Rules & Regulations of the State of Tennessee
Title 0770 - Housing Development
Chapter 0770-03-01 - Moderate Rehabilitation Program
Section 0770-03-01-.09 - RENT ADJUSTMENTS

1. The Annual Adjustment Factors which are published annually by HUD (see 24 CFR Part 888 ) will be utilized. On or after each anniversary date of the Contract, the Contract Rents may be adjusted effective with the month following the submittal by the Owner of a revised schedule of Contract Rents which may be no higher than Rents established by applying the applicable Annual Adjustment Factor most recently published by HUD to the Contract Rent minus the monthly amortization amount of the rehabilitation loan, or the Contract Rent established at the end of the rehabilitation loan term. These increased Contract Rents must then be examined in accordance with Rule 0770-31-.09(2) and may adjusted accordingly. Contract Rents may be adjusted upward or downward, as may be appropriate; however, in no case may the adjusted rents be less than the Contract Rents on the effective date of the Contract except as otherwise provided.

2. A special adjustment, subject to HUD approval, to reflect increases in the actual and necessary expenses of owning and maintaining the unit which have resulted from substantial general increases in real property taxes, utility rates, assessments and utilities not covered by regulated rates, may be recommended by the Agency for approval by HUD but only if and to the extent that the Owner clearly demonstrates that these general increases have caused increases in the Owner's operating costs which are not adequately compensated for by annual adjustments. The Owner must submit financial information to the Agency which clearly supports the increase. For Contracts of more than twenty units, the Owner must submit audited financial information.