> ## Content Index > Fetch the complete content index at: https://blog.phadevelopment.com/llms.txt > Use this file to discover other available public pages before exploring further. # HUD Draws a Line on Accessibility Liability: What the New Statute of Limitations Means for PHAs, RAD, and Acquisitions - URL: https://blog.phadevelopment.com/hud-fair-housing-accessibility-statute-of-limitations/ - Published: 2026-09-15T17:35:03.000Z - Updated: 2026-09-15T18:14:29.000Z - Author: Brian West - Tags: Regulatory Updates, RAD, Repositioning On September 1, 2026, HUD announced that it had rescinded "burdensome guidance" as part of its housing affordability agenda. The press release was short. The underlying legal change is not trivial, and it reaches further into affordable housing finance than the headline suggests. The action is a memorandum dated August 31, 2026 from Craig Trainor, Assistant Secretary for Fair Housing and Equal Opportunity. It resets when the clock starts on complaints that a multifamily building violates the Fair Housing Act's design and construction accessibility requirements. HUD says the old interpretation led to more than $110 million in repair costs over five years, imposed on building owners whether or not they had anything to do with the original construction. For housing authorities, the memo matters in two directions. It lowers a real cost barrier when a PHA or its affiliate acquires or recapitalizes a post-1991 property. It also does almost nothing to your Section 504 and ADA obligations, which are the accessibility rules that actually govern most PHA-owned and assisted housing. If you read only the press release, you could come away with the wrong impression about the second point. ## What HUD changed The Fair Housing Amendments Act of 1988 requires "covered multifamily dwellings" first occupied after March 13, 1991 to include seven basic accessibility features. Covered dwellings are every unit in an elevator building with four or more units, and every ground-floor unit in a non-elevator building with four or more units. Failing to design and construct those features is a discriminatory housing practice under 42 U.S.C. § 3604(f)(3)(C). The Act gives an aggrieved person one year to file an administrative complaint with HUD and two years to file a lawsuit. Both periods run from when the discriminatory practice "occurred or terminated." The question has always been when a design and construction violation "terminates." **The old position.** The 2013 HUD/DOJ Joint Statement on design and construction took the view that the limitations period started when a person was injured by the inaccessible feature. Because an injury could happen at any time until the building was fixed, the practical result was that a noncompliant building carried open-ended liability. HUD's 1998 Design Manual took a similar continuing-violation approach for administrative complaints. **The new position.** HUD now treats a design and construction violation as a discrete act that ends when construction ends. Effective immediately: - An administrative complaint alleging a § 3604(f)(3)(C) violation must be filed with FHEO within **one year of the issuance of the initial certificate of occupancy**. - The continued existence of an inaccessible feature does not restart or extend that period. - For private lawsuits, HUD says it supports a two-year period running from the initial certificate of occupancy. Courts decide that question themselves, and HUD acknowledges this. - Contrary prior guidance, including the relevant portions of the Design Manual, is superseded. HUD and DOJ jointly rescinded the limitations sections of the 2013 Joint Statement on August 13, 2026. HUD grounds the change in the Ninth Circuit's en banc decision in *Garcia v. Brockway* (2008), which held that the violation terminates when construction is complete. The memo expressly rejects the Sixth Circuit's alternative view, from an unpublished 2006 decision, that the clock runs from the sale or rental of the noncompliant unit. It also relies on the Eleventh Circuit's holding in *Harding v. Orlando Apartments* (2014) that the Act does not place an ongoing duty on subsequent owners to bring a building into compliance with standards someone else failed to meet. ## Why this matters for acquisitions and repositioning The most consequential passage in the memo is not about builders at all. It is the section on current owners. HUD states plainly that its prior approach put the cost of original design and construction violations on owners who had no role in them. According to the memo, those owners were pushed into costly accessibility retrofits as a condition of HUD approvals, regardless of whether any resident had asked for the features and even over the objection of current residents. HUD now takes the position that the Fair Housing Act places no ongoing duty on a subsequent owner to fix a building someone else built wrong. That matters because housing authorities are increasingly subsequent owners. For PHAs and their development affiliates, the transactions where this is most likely to show up include: - **Acquisition of post-1991 LIHTC properties**, including Year 15 buyouts and preservation purchases structured with 4% credits and tax-exempt bonds. - **Recapitalization of affiliate-owned mixed-finance phases** built in the HOPE VI and early mixed-finance era, many of which were first occupied after 1991. - **Acquisition strategies that use Faircloth authority or project-based vouchers** to bring newer market-rate or workforce buildings into the affordable portfolio. - **Transfers of properties between a PHA and its instrumentalities** as part of a broader repositioning plan. The capital stack effect is straightforward. When accessibility work is scoped for a post-1991 building, the portion that existed only to cure the original builder's Fair Housing Act violations should now be examined on its own terms. Every dollar of retrofit that is no longer required is a dollar that no longer needs a source, and on a thin acquisition or recapitalization, that can decide whether the deal works. A caution on timing: the memo is FHEO guidance, and other HUD offices and funders have not, to our knowledge, issued conforming guidance on how they will treat these findings going forward. Expect some variation in how this is applied, and confirm the treatment with each funding partner before you build a sources and uses around the assumption that retrofits are gone. ## What did not change This is where housing authorities need to be careful. The memo is narrow, and several obligations sit entirely outside it. **The design and construction requirements themselves.** Nothing in the memo relaxes the seven FHAA requirements for new construction. Any building you develop today still has to meet them. What changed is how long someone has to file a complaint about noncompliance, not whether compliance is required. **Section 504.** This is the big one. Section 504 of the Rehabilitation Act and HUD's implementing regulations at 24 CFR Part 8 apply to every recipient of HUD financial assistance, which includes every public housing authority. Section 504 is not a design and construction statute with a one-year clock. It imposes ongoing program accessibility obligations: - Under 24 CFR 8.24, existing housing programs must be operated so that, viewed in their entirety, they are readily accessible to and usable by people with disabilities. - Under 24 CFR 8.23, a substantial alteration (a project of 15 or more units where alteration costs reach 75% of replacement cost) triggers the full new construction standard of 24 CFR 8.22\. That means at least 5% of units accessible for people with mobility impairments and an additional 2% for people with hearing or vision impairments. - Lesser alterations still require accessibility to the maximum extent feasible, and altered units count toward the 5% and 2% thresholds until they are met. - UFAS remains HUD's Section 504 standard, with the 2010 ADA Standards available as an alternative under HUD's 2014 deeming notice. None of that is touched by the Trainor memo. A 1995 building that is part of a public housing, RAD, or federally assisted project can be immune from an FHEO design and construction complaint and still be out of compliance with Section 504. **RAD conversions.** RAD conversions remain subject to the Fair Housing Act, Section 504, and ADA Title II, and HUD's RAD fair housing and civil rights requirements continue to apply to conversion scopes. If your conversion involves post-1991 mixed-finance units, the memo may reduce FHAA exposure on paper, but your accessible unit count and physical accessibility scope will still be driven by Section 504\. Budget accordingly. **ADA Title II.** Housing authorities are public entities. Title II applies to their programs, services, leasing offices, community spaces, and other public-facing facilities, independent of the Fair Housing Act. **Reasonable accommodations and modifications.** These are separate Fair Housing Act obligations under § 3604(f)(3)(A) and (B), and they arise each time a qualifying request is made. The memo actually draws on this distinction to support its reasoning. A resident whose unit lacks an accessible feature can still request an accommodation or modification, and under Section 504 the housing authority will often bear the cost of structural modifications. **Department of Justice enforcement.** The memo states that it does not address or alter the timeframe for the Attorney General to bring actions under 42 U.S.C. § 3614\. Pattern-or-practice enforcement is a separate track. **Pattern-or-practice claims.** HUD notes that timely acts forming part of an alleged pattern or practice may still allow consideration of related conduct outside the limitations period. A developer with a portfolio of noncompliant buildings is not insulated just because some of them are old. **Private litigation.** Courts are not bound by the memo, and the Supreme Court's *Loper Bright* decision makes that explicit. Only two federal appeals courts have ruled on when the design and construction clock starts, and they disagree. Authorities in the Second and Third Circuits, which cover New York, Connecticut, New Jersey, and Pennsylvania, operate without controlling appellate authority on the question. Authorities in the Sixth Circuit (Michigan, Ohio, Kentucky, Tennessee) face a circuit precedent that ties accrual to sale or rental rather than the certificate of occupancy. **State and local law.** The Fair Housing Act does not preempt state and local accessibility requirements that go further, and many do. New York, New Jersey, California, and a number of cities have their own accessibility codes and human rights laws with their own enforcement timelines. State housing finance agencies also layer accessibility requirements into their QAPs and regulatory agreements. **LIHTC compliance.** An adverse final fair housing decision can still create general public use exposure for tax credit properties. The memo should reduce the number of administrative design and construction findings against older buildings, but it does not eliminate the other routes to such a decision. ## The new construction side of the equation For housing authorities developing new units through Faircloth-to-RAD or 9% and 4% credits, the memo creates a subtle shift in risk that is worth thinking through. Under the old interpretation, an aggrieved person could pursue the builder and designer long after completion. Under the new one, administrative exposure for the original development team ends a year after the certificate of occupancy. After that, when a resident with a disability needs a feature the building should have had, the request lands on the owner as a reasonable accommodation or Section 504 matter. If the housing authority or its affiliate is the long-term owner, the authority is the party that pays. In other words, the memo shortens the builder's regulatory tail and leaves the long-term owner holding whatever the builder got wrong. For a PHA, that argues for tighter controls at the front end: - Require an independent third-party accessibility review of construction documents covering FHAA, Section 504, and ADA, not just a local code review. - Require a pre-CO accessibility inspection by a qualified reviewer, with findings tied to the punch list. - Tie retainage release to closure of accessibility deficiencies. - Negotiate contractual warranties and indemnities in the development agreement, architect's contract, and construction contract that cover accessibility compliance and survive well beyond the certificate of occupancy. Your contractual remedies are not governed by the Fair Housing Act's limitations period. - In co-developer structures, make sure the private partner's design and construction obligations and guaranties explicitly include accessibility compliance. The cheapest accessibility retrofit is the one that never has to happen. ## What housing authorities should do now 1. **Inventory post-1991 properties** in your portfolio and pipeline, including affiliate-owned and mixed-finance phases, and note each building's initial certificate of occupancy date. 2. **Revisit pending acquisition and rehab scopes.** If a capital needs assessment carried repairs driven only by FHAA design and construction findings, confirm with your funding partners how those items will be treated and whether the scope can be revised. 3. **Separate the accessibility scope by legal source.** For each rehab or conversion budget, identify what is driven by Section 504, ADA Title II, state law, and the QAP, and what was driven only by FHAA design and construction findings. Only the last category is affected by this memo. 4. **Do not reduce accessible unit counts on RAD or assisted projects** based on this guidance. Section 504 thresholds are unchanged. 5. **Update development agreements and construction contracts** on new construction to strengthen accessibility review, inspection, retainage, and warranty provisions. 6. **Check your state and local requirements** before assuming any relief applies in your jurisdiction. 7. **Watch for conforming guidance** from the Office of Multifamily Housing and any litigation challenging the memo. ## The bottom line HUD's new position removes a long-running source of cost and uncertainty for owners who acquire buildings they did not build. For housing authorities pursuing acquisitions and repositioning, that can meaningfully change the math on post-1991 properties. It does not change the accessibility obligations that come with federal assistance. Section 504, ADA Title II, reasonable accommodation duties, and state law continue to apply in full. The authorities that benefit most from this change will be the ones that can tell the difference when they scope and budget their projects, and that tighten their construction controls on new development rather than loosen them. --- *PHA Development advises housing authorities on RAD conversions, Section 18 dispositions, mixed-finance structuring, and capital stack strategy. If you are evaluating an acquisition or repositioning strategy and want to understand how this guidance affects your scope and sources, we can help. This post is general information and not legal advice; consult fair housing counsel on specific properties.* [**Schedule a Consultation →**](https://phadevelopment.com/?ref=blog.phadevelopment.com#contact)