Rural Development Service Announces Change to HOTMA Implementation Date

On October 3, 2024, the Rural Housing Service (RHS) announced a change in the Housing Opportunity Through Modernization Act (HOTMA) implementation date.

On September 20, 2024, the Department of Housing and Urban Development (HUD) announced that the compliance date for HUD programs is extended to July 1, 2025. To align with HUD, RHS is extending the full implementation of applicable HOTMA regulations to the same date – July 1, 2025. All RHS Multifamily Housing (MFH) tenant certifications, effective on or after July 1, 2025, must comply with HOTMA requirements.

RHS published an Unnumbered Letter on August 19, 2024, notifying MFH staff and housing operators of the anticipated timeline for HOTMA implementation. As indicated in the UL, the updated Management Interactive Network Connection (MINC)/Industry Interface specifications for software providers have been posted on the MINC homepage. Due to the new implementation date, owners of RHS properties should note the following:

1. The updated Form RD 3560-8 is expected to be published in October 2024. Since tenant certifications can be submitted to the Agency up to 90 days before their effective date, the following will apply:
   • The updated Form RD 3560-8 will be used to submit tenant certifications effective July 1, 2025.
   • Once the updated form is published, the current Form RD 3560-8 will be renamed Form RD 3560-8A and should be used for tenant certifications effective before July 1, 2025.
2. Updates to Handbook 2-3560, initially scheduled for October 2024, will be delayed until January 2025. This will give MFH and property staff adequate time to review the changes before the July 1, 2025 implementation date.
3. Any references to January 1, 2025, in the UL should be replaced with July 1, 2025.
4. The passbook savings rate increase from 0.4% to 0.45% will still be implemented on January 1, 2025.

Owners and managers of RHS properties, including those operating under Section 515, should carefully review the August 19, 2024, Unnumbered Letter for the RD requirements relating to HOTMA implementation.