Title 24

SECTION 401.412

401.412 Adjustment of rents based on operating cost adjustment factor (OCAF) or budget.

§ 401.412 Adjustment of rents based on operating cost adjustment factor (OCAF) or budget.

(a) OCAF. (1) The Restructuring Plan must provide for annual adjustment of the restructured rents for project-based assistance by an OCAF determined by HUD.

(2) Application of OCAF. HUD will apply the OCAF to the previous year's contract rent less the portion of that rent paid for debt service. This paragraph applies to renewals of contracts in subsequent years which receive restructured rents under either section 514(g)(1) or (2) of MAHRA.

(b) Budget-based. Rents will be adjusted on a budget basis instead of OCAF only upon owner request, subject to HUD approval.

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