Transcript PSH Risk Mitigation Pool Draft Policies and Procedures

PSH Risk Mitigation Pool
Guiding Principles, Policies
and Procedures
The Housing Development Center
Presentation to Participating Owners
Tuesday, Nov. 10, 2009
1
AGENDA
1. Policies and Procedures Development
Process


Guiding principals and approach
Roles
2. Program Policies
 Maximum amount per project and per claim
 Allowed uses and types of claims
3. Claims and Procedures
 Procedures for certification
 Filing claims and disbursement process
 Appeals process
2
1. Policies and Procedures
Development Process
3
Guiding Principals and Approach
 Offset potential increased risk to property owners




who own PSH units beyond traditional affordable
housing for seven years
Provide financial protection without having to set
aside substantial reserves per project
To manage the RMP in a fair and efficient manner
Built in evaluation component to adjust policies and
procedures over time as we learn where the risks lie
in managing PSH
Policies and procedures are not meant to be rigid - it
provides a basis to gather data on risks and claims to
provide PSH for seven or more years
4
Roles
 Participating Owners (POs)
 20 owners are responsible for filing claims and providing data for evaluation
 RMP Advisory Committee
 Seth Lyon (Mult. Co.), Dave Bachman (Cascade Management), Margaret
Mahoney (REACH), Louise Lauman (PDC), Martin Soloway (CCC), and Dawn
Martin (PHB)
 Reports and makes recommendations to PHB
 No decision making authority on claims, except per Section F.
 HDC
 Provides administrative services, program development, fiscal management,
and reporting to PHB quarterly
 Staffs the Advisory Committee
 Processes claims
 PHB
 Final authority on policies, procedures, and appeals
 Selects PSH units covered by RMP
 Approves Advisory committee membership and monitors HDC’s reports and
audits
5
2. Program Policies
6
Maximum Amount Per Project
 There is a maximum lifetime cap for a project
regardless of which PSH unit is affected
 Project maximum =


Multiply the number of PSH units by the
maximum amount per claim to get your project
RMP coverage maximum
The maximum amount per claim is based on
unit size
7
Maximum Amount Per Claim
 Maximum claim amount is based on 4 unit sizes:




SRO
Studio
One-bedroom
Two-plus bedroom
$7,500
$9,000
$10,000
$14,500
Example: Building A has 10 studios covered by
RMP
10 units x $9,000 (studio cap) = $90,000
Project Maximum: $90,000 in RMP coverage for
up to 7 years to reimburse for losses
Per Claim Maximum: $9,000
8
Maximum Claim Per Unit, cont.
Total claims exposure when maximum is adjusted for unit size
Unit size
SRO
Maximum amount per unit
$7,500
1 br
2 + br
$9,000
$10,000
$14,500
92
67
61
36
278
690,000
600,750
610,000
522,000
2,422,750
Number of units
Total potential claims
Studio
Total
Total claims exposure when maximum is fixed at $10,000 per unit
Maximum amount per unit
Number of units
Total potential claims
$10,000
278
$2,780,000
9
Allowed Uses and Types of Claims:
Physical
 Physical damage caused by the PSH tenant such
as:





Excessive cleaning
Debris removal
Extermination
Repair of doors, walls, cabinetry
Other damage in excess of normal costs
 An administrative fee of 5% of the damage costs
is allowed to POs to supervise the repairs
 Deductible of $475 per physical claim
 Cannot be reimbursed for typical turnover costs
or normal wear and tear
10
Physical Definition, cont.
a. If a PSH tenant causes physical damage to
their PSH unit, other units, and/or elsewhere
on the property, these costs qualify to be
covered by the Risk Mitigation Pool.
b. If a non-PSH tenant causes physical
damage to a PSH unit, the costs do not
qualify.
11
Allowed Uses and Types of Claims:
Operational
 Operational claims are claims related to lost rent
revenues or excessive operating losses:

Legal costs related to evictions

Relocation expenses, including moving a tenant’s
belongings, when the move is necessary to protect the
property, staff, or other tenants from physical harm

Rent that is owing but not collected, not to exceed 90
days

Vacant turnover time in excess of 60 days
 Deductible is $350 per operational claim, which
does not apply when physical claim is included
12
Allowed Uses and Types of Claims:
Operational, cont.
 Not eligible for reimbursement:
 Any
increase in insurance premiums
 Claims for supportive services
 Lost rent during initial lease-up period
 NOTE: The RMP is not a rent subsidy
program
13
Allowed Uses and Types of Claims:
Bed Bugs
 Eligible reimbursable costs for 100% PSH
Projects or for Infestations Originating from
a PSH-Qualified Tenant:




Treatment of Infected Units
Surrounding Units - In accordance with
standard pest control company protocol
Replacement of Furniture - one mattress,
one box spring and/or bed frame, one
mattress liner, one table, one chair, and one
dresser per unit
Replacement of Common Area Furniture
14
Allowed Uses and Types of Claims:
Bed Bugs, cont.

Eligible Reimbursable Costs for
Infestations Without Proof of Origin for
Projects with Less than 100% PSH units:


Eligible costs prorated by the number of
PSH units covered by the RMP
Proration equals the RMP covered units
divided by the total number of units in the
project
15
Allowed Uses and Types of Claims:
Bed Bugs, cont.

Pesticide Applicator Qualifications:


Owners that use their own staff to treat the
infestation must have a “pesticide applicator
license.”
See http://oregon.gov/ODA/PEST/ for more
information on getting a pesticide license.
16
Allowed Uses and Types of Claims:
Bed Bugs, cont.


Additional documentation required (see
claims policies and procedures)
Second bed bug claim at same project:
Owner has to demonstrate implementation
of an Integrated Pest Management Plan in
order to be reimbursed
17
Allowed Uses and Types of Claims:
Insurance
 Insurance Claim Adjustment

The amount eligible from the fund will be
reduced by the amount that could be
recovered from an insurance claim when the
after-deductible insurance benefit amounts to
$3,000 or more

The decision of whether to actually file a claim
is up to the owner
18
3. Claims and Procedures
19
Procedures for Certification
 PHB will designate PSH units and maintain list as




new projects are placed or taken out of service
PHB sends HDC list of PSH designated units with the
projects’ letter of agreement
For non-100% PSH projects, owner submits rent roll
or PDC rent and utility schedule to HDC
Owners of floating PSH units need to submit ongoing
documentation to HDC that unit is being used as
PSH
Documentation of move-in condition (use own form)
20
Statute of Limitations
 Requirement: The claims form and required
accompanying materials, described in Section
C.2., must be submitted to HDC within 90 days
from the time the damage or loss occurred.

An exception to this requirement is if pending
insurance determination that would prevent the
claims form from being complete. In these
instances, HDC must be notified of intent to file
a claim within 90 days of the occurrence
21
Statute of Limitations (cont.)
 Process:
 Participating Owners are encouraged to notify HDC of
any potential claims as quickly as possible for verification
that damages are eligible costs before repairs are made
 Participating Owners complete the claims form, attach
the accompanying materials and submit to HDC,
postmarked within 90 days of damages or losses
 If damages are awaiting a determination by insurance,
Participating Owners must notify HDC of their intent to
submit a claim within 90 days of damages/losses
occurred
22
Claim Review
 Requirement: HDC must verify that the claimant has
sustained an eligible loss and that the reimbursement
requested is cost reasonable
 Process:



Submit claims application to the HDC Asset Manager,
who will determine that the unit is eligible and that the
application is complete
Physical repair claims will be assigned to an HDC
Construction Project Manager
Operational claims will be reviewed by the HDC Asset
Management Program Manager
23
Additional Review Criteria
 Requirement: HDC and the PHB contract
manager for the RMP will jointly review the
claim if it:


Exceeds $10,000, or
Requests an out of ordinary reimbursement for
damages that do not meet the existing
interpretation of the policies and procedures
24
Disbursement of Funds
 Requirement: Funds will be held by HDC for
direct disbursement to the claimant from HDC
 Process:


All claim amounts will be approved by the
Asset Management Program Manager
Claim checks will be sent to Owner (not
management company, unless so directed)
within 10 business days after complete
application has been processed
25
Appeals Process


If your claim was denied, you can file an appeal
Appeals Process:
1.
2.
3.
4.
HDC’s Asset Manager, Molly Rogers
HDC’s Executive Director, Robin Boyce
PHB’s RMP manager, Dawn Martin, for final decision
The RMP advisory committee make program-level
decisions and have no decision-making authority on
individual claims unless the claim meets criteria set
forth in Section F
26
Claims and Procedures: Attachments
 RMP Claim Form
 Attachment A: Physical Damage Form
 Rental Agreement
 Itemization of Costs
 Move-in Condition Form
 Move-out accounting
 Bids/Invoices
 Set-aside list indicating unit as PSH certified
27
Questions and Answers
The Housing Development Center
847 NE 19th Avenue, Suite 150
Portland, OR 97232
(503) 335-3668
28