The U.S. Department of Housing and Urban Development (HUD) indicated in Notice H 2025-03 that the implementation of the Housing Opportunity Through Modernization Act of 2016 (HOTMA) for the Section 811 Project Rental Assistance (Section 811 PRA) program would go into effect by January 1, 2026. Since HUD has not finalized an updated HUD model lease, other HUD forms, or forms HUD-50059/HUD-50059-A, Owners are not currently able to proceed with related processes using those required forms. HUD has not provided any additional publicly-available guidance regarding this matter.
As a result, the Texas Department of Housing and Community Affairs (TDHCA) is providing some technical assistance.
TDHCA would anticipate Owners with properties participating in the Section 811 PRA program to elect, until further guidance is provided by HUD, one of the following options for all tenants participating in the program at a development:
— Option 1: The development maintains pre-HOTMA policies and procedures. Under Option 1, the property would notify interested parties that their post-HOTMA written policies and procedures have not gone into effect, yet. Pre-HOTMA forms, calculations, and certifications would be maintained in tenant files. This would apply uniformly to all Section 811 PRA-assisted tenants.
— Option 2: The development implements post-HOTMA policies and procedures besides those directly related to missing finalized forms. Under Option 2, the property would notify interested parties that their post-HOTMA written policies and procedures have gone partially into effect, and indicate which policies cannot be implemented due to the circumstances outlined above. This would apply uniformly to all Section 811 PRA-assisted tenants.
Owners may not execute HOTMA-drafted HUD model leases or HUD forms. For now, TDHCA recommends allowing currently executed lease contracts to default to month-to-month terms, which is without penalty. Without an executed post-HOTMA HUD model lease, families are obligated to continue to report changes of more than $200 per month in income. Owners electing option 1 would continue to process certifications meeting pre-HOTMA requirements; however, Owners electing option 2 would process certifications post-HOTMA, including updated inflationary adjustments and calculations of income and rents, while explaining the circumstances to tenants.
Additionally, for option 2, forms HUD-50059/HUD-50059-A in files must implement rent override functions as described at https://www.hud.gov/sites/dfiles/Housing/documents/Rent_Override.pdf. Owners remain responsible for calculating correct income, deposits, and rents required under the program, even when implementing this process. TDHCA recommends checking calculations on forms HUD-50059/HUD-50059-A prior to executing since forcing the implementation of HOTMA in this way may result in errors.
If HUD provides additional guidance, including a revised effective date for HOTMA, or makes available the finalized versions of necessary HUD forms, the property would be required to implement as required per that guidance. TDHCA would also provide notification through listservs at that time.