HUD Section 811 is the federal program that funds affordable, integrated rental housing for very low-income adults with disabilities. It is the companion to the Section 202 program for the elderly, but it serves a different population and, since 2010, operates through two distinct models that owners need to understand.
This guide explains what Section 811 is, how the traditional capital advance program differs from the newer Project Rental Assistance program, and the compliance and audit obligations owners take on. It is written for developers, nonprofit sponsors, and managing agents who own or are considering 811 units, whether as standalone properties or as a reserved share of a larger development.
What the Section 811 Program Is
Section 811 traces to the Cranston-Gonzalez National Affordable Housing Act of 1990, which separated housing for persons with disabilities from the Section 202 elderly program. The goal is to help adults with disabilities live independently in the community rather than in institutional settings. HUD oversees it through its office for multifamily housing for seniors and persons with disabilities.
The program serves very low-income and extremely low-income adults with disabilities, generally those aged 18 to 61 at entry. Residents pay roughly 30% of their adjusted income toward rent, and federal assistance covers the rest.
A core principle of Section 811 today is integration. Rather than concentrating residents with disabilities in standalone buildings, the modern program emphasizes a limited number of assisted units within larger mixed-income developments, so residents live alongside the general population.
The Two Section 811 Models
Owners frequently confuse the two versions of Section 811, and the differences drive how a property is financed, reported, and audited.
The traditional capital advance model mirrors Section 202. HUD provides a capital advance to a nonprofit sponsor to develop the housing, paired with a Project Rental Assistance Contract that subsidizes operations. The capital advance does not have to be repaid as long as the property serves eligible residents for the term of the use agreement. These are typically small, purpose-built properties owned by nonprofits.
The Section 811 Project Rental Assistance program, often called 811 PRA, was created by the Frank Melville Supportive Housing Investment Act of 2010. It works very differently. Instead of funding new construction directly, HUD provides rental assistance to state housing agencies, which partner with state Medicaid and health and human services agencies. The assistance is layered onto units within existing or newly built multifamily properties, very often developments already financed with the Low-Income Housing Tax Credit.
Under 811 PRA, the share of assisted units in any single property is capped, commonly at 25%, to preserve the integrated housing model. That cap and the partnership with state health agencies are defining features of the program, and HUD sets out the full eligibility and integration rules in its Section 811 PRA program materials.
How Section 811 Interacts With Other Programs
Because 811 PRA is designed to layer onto existing properties, it rarely stands alone. The most common pairing is with Low-Income Housing Tax Credit financing, where the tax credit funds development and the 811 PRA provides deep rental assistance for a subset of units reserved for persons with disabilities.
That layering means an owner must satisfy two sets of rules at once: the Section 42 compliance regime for the tax credit and the Section 811 PRA requirements for the assisted units. For a foundation on the tax credit side, see our guide to how the Low-Income Housing Tax Credit works.
The traditional capital advance model, by contrast, usually operates like a Section 202 property, with HUD as the primary source of both development funding and operating assistance.
The 811 PRA program is also built on a formal partnership structure. HUD awards funding to a state housing finance agency, which signs a cooperative agreement committing a state Medicaid or health and human services agency to identify and refer eligible residents and to make community-based services available. That three-way relationship is unusual in affordable housing, and it means an owner’s compliance obligations extend beyond HUD to the state partners named in the agreement. Understanding who is responsible for referrals, services, and oversight is essential before a property accepts 811 PRA units.
Audit and Reporting Requirements
Audit obligations depend on which model applies.
Owners of traditional Section 811 capital advance properties generally must submit annual audited financial statements to HUD through the FASS-MF system under the Real Estate Assessment Center, following the Consolidated Audit Guide in HUD Handbook 2000.04. As with Section 202, nonprofit sponsors may also trigger a Uniform Guidance single audit if federal expenditures exceed the annual threshold.
For 811 PRA units layered onto a tax credit property, the property’s financial statements are typically audited under the requirements of the tax credit investor and lender, while the 811 PRA assistance adds program-specific compliance monitoring handled through the state administering agency. Owners should map out, before the first year of operations, exactly which audits and submissions apply, because a mixed-finance property can carry several overlapping requirements.
Eligibility and Resident Referral
Who can live in a Section 811 unit, and how they get there, differs from most housing programs and affects an owner’s compliance records. Residents must be very low-income adults with disabilities, and under the 811 PRA program referrals typically flow through a state Medicaid or health and human services agency rather than a conventional waiting list.
That referral partnership is written into the cooperative agreement between HUD, the state housing agency, and the health agency. For an owner, it means tenant eligibility is documented jointly with state partners, and the files supporting each assisted unit must reconcile to both the housing agency’s records and the property’s own accounting. When an audit or program review tests eligibility, those shared records are where findings tend to arise.
Common Challenges on Blended Deals
Because 811 PRA units usually sit inside a larger tax credit property, the hardest problems are the ones created by overlapping rules. A unit reserved for an 811 resident must satisfy Section 42 income and rent limits and the 811 PRA requirements at the same time, and the two regimes measure income and set rents in ways that do not always align.
Utility allowances, unit designations, and recertification timing all have to work for both programs. Reserve accounts and distribution limits may answer to the tax credit investor, the lender, and HUD at once. Owners who map these requirements onto a single compliance calendar, rather than managing them in separate silos, avoid the conflicts that otherwise appear in the first year of operations.
Where a CPA Fits In
Section 811 properties demand accounting that spans HUD reporting, nonprofit single audits, and tax credit compliance. A CPA experienced in supportive housing helps owners prepare HUD-required audits and FASS-MF submissions, coordinate single audits, reconcile tax credit and 811 PRA compliance on blended deals, and structure financial reporting for state administering agencies.
Pease Bell works with developers and nonprofit sponsors across HUD-assisted and tax credit housing. Learn more on our affordable housing industry page and our HUD services page.
Frequently Asked Questions
What is Section 811 housing?
Section 811 is a HUD program that funds affordable, integrated rental housing for very low-income adults with disabilities. It helps residents live independently in the community, and residents generally pay about 30% of their adjusted income toward rent while federal assistance covers the rest.
What is the difference between Section 202 and Section 811?
Section 202 serves very low-income elderly households, while Section 811 serves very low-income adults with disabilities. Both use a capital advance and project rental assistance model, but Section 811 also operates a separate Project Rental Assistance program that layers rental aid onto mixed-income properties.
What is the Section 811 PRA program?
The Section 811 Project Rental Assistance program, created by the Frank Melville Supportive Housing Investment Act of 2010, provides HUD rental assistance through state housing agencies that partner with Medicaid and health agencies. The assistance is attached to a limited number of units in existing multifamily properties, often tax credit developments.
Can Section 811 be combined with the Low-Income Housing Tax Credit?
Yes. The 811 PRA program is frequently layered onto Low-Income Housing Tax Credit properties, with the tax credit funding development and the 811 PRA providing deep rental assistance for a capped share of units reserved for persons with disabilities.
Do Section 811 owners need an annual audit?
Traditional Section 811 capital advance owners generally must submit annual audited financial statements to HUD through FASS-MF under the Consolidated Audit Guide. For 811 PRA units on tax credit properties, the property audit follows tax credit and lender requirements, with additional program monitoring through the state agency.
What is the integration requirement in Section 811?
The modern Section 811 program emphasizes integrated housing, meaning assisted units for persons with disabilities are a limited share of a larger mixed-income property. Under the 811 PRA program, that share is commonly capped at 25% of a property’s units.
