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Federal Register / Vol. 86, No. 8 / Wednesday, January 13, 2021 / Proposed Rules 1 Revisions. HUD will issue a notice in the Federal Register published for 30
days of public comment making any revisions to the inspection procedures HUD deems necessary, every three years, or three years after the most recent revision, whichever is later.
2 Emergency Revisions. The Secretary may publish a final notice without 30 days of public comment in the case of an emergency to protect Federal financial resources or the health or safety of residents of public housing projects, after HUD makes a documented determination that such action is warranted due to:
i A Severe Health or Safety deficiencies and other significant risks to safety as outlined in 5.703;
ii A new safety concern due to changing construction technology; or iii Other events as determined by the Secretary.
5.711 Scoring, Ranking Criteria, and Appeals.

a Applicability. Administrative process for scoring and ranking the physical condition of HUD housing properties under this section does not apply to the HCV or PBV program.
PHAs administering HCV and PBV
programs will be assessed under the Section 8 Management Assessment Program SEMAP or the small rural PHA assessment in accordance part 985
of this title.
b Scoring and ranking of HUD
housing1 General. HUDs Real Estate Assessment Center REAC, or the appropriate entity either as described in 5.705b, or as identified in the regulator agreement or contract for the property as described in 5.705b1, will score and rank the physical condition of HUD housing properties in accordance with the procedures set out by the Secretary in 5.709.
2 Public Housing programs. PHAs operating Public Housing will be scored and ranked under the Public Housing Assessment System PHAS outlined in part 902 of this title.
c Inspection report requirements 1 Severe health or safety deficiencies.
Upon completion of an inspection, or at the end of each day on a multiple-day inspection, REAC, or the appropriate party as described in 5.705b, will provide the owner or PHA or owners representative, a notice of any items classified as Severe Health or Safety SHS deficiencies. All SHS items must be mitigated within 24 contiguous hours of receipt of notice of these items, and the owner or PHA or owners representative must electronically certify and provide supporting evidence within 3 business days after the end of
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the inspection that the SHS items have been resolved or sufficiently abated such that they no longer pose a severe health or safety risk to residents of the property. SHS deficiencies together with other types of deficiencies will be fully described in a future Federal Register notice.
2 Post-report inspection. The owner or PHA must carefully review the inspection report and is responsible for conducting its own survey of the total property based on the inspecting entitys inspection findings. Non-severe health or safety deficiencies must be corrected expeditiously, and electronic evidence provided of correction.
3 Identification of material errors or adverse conditions. If, after reviewing the inspection results, the owner or PHA reasonably believes that either an objectively verifiable and material error occurred in the inspection or that adverse conditions beyond the owners or PHAs control negatively impacted the score, and that the error or adverse condition, if corrected or accounted for, would result in a significant improvement in the propertys overall score, the owner or PHA may electronically submit a request for a technical review.
d Technical review of inspection results1 Timing. A request for a technical review of inspection results must be submitted electronically and must be received by the inspecting entity no later than the 45th calendar day following the release of the inspection report.
2 Request for technical review. The request must be accompanied by the owners or PHAs relevant evidence that an objectively verifiable and material error occurred or adverse conditions beyond the owner or PHAs control occurred, which if corrected will result in a significant improvement in the overall score of the owners property. A
technical review of the inspection results will not be conducted based on conditions that were corrected subsequent to the inspection. Upon receipt of this request from the owner or PHA, the REAC will review the inspection and the evidence. If the REAC review determines that an objectively verifiable and material error or errors or adverse conditions beyond the owner or PHAs control has been documented and that it is likely to result in a significant improvement in the propertys overall score, the REAC
will take one or a combination of the following actions:
i Undertake a new inspection;
ii Correct the original inspection; or iii Issue a new physical condition score.

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3 Burden of proof that error or adverse conditions occurred rests with owner. The burden of proof rests with the owner to demonstrate that an objectively verifiable and material error or errors or adverse conditions occurred in the REACs inspection through submission of evidence, which if corrected will result in a significant improvement in the propertys overall score. The REAC will apply a rebuttable presumption that the inspection was conducted accurately. To support its request for a technical review of the physical inspection results, the owner may submit photographic evidence, written material from an objective source with subject matter expertise that pertains to the item being reviewed such as a local fire marshal, building code official, registered architect, or professional engineer, or other similar evidence.
4 Basis for Technical Review. There are four sources of error that are associated with an inspection score.
After review of each type of error, the propertys score may be adjusted or other action taken.
i Material errors. An objectively verifiable material error must be present to allow for a technical review of inspection results. Material errors are those that were not due to the fault of the owner and exhibit specific characteristics and meet specific thresholds. The three types of material errors are as follows.
ii Building data error. A building data error occurs if the inspector inspected the wrong building or a building that was not owned by the property, including common or site areas that were not a part of the property. Incorrect data due to the failure of an owner to ensure HUDs systems of records are updated cannot form the basis of a review. Incorrect building data that does not affect the score, such as the address, building name, year built, etc., would not be considered material.
iii Unit count error. A unit count error occurs if the total number of units considered in scoring is incorrect due to the fault of HUD. Since scoring uses total units, REAC will examine instances where the participant can provide evidence that the total units used was incorrect and that the results were not representative of the condition of the property.
iv A non-existent deficiency error. A
non-existent deficiency error occurs if the inspection records an observed deficiency that does not satisfy or does not meet a reasonable interpretation of the definition of that deficiency as defined by inspection procedures.

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