Creating a Memorandum of Understanding

What steps are involved in creating an MOU?

It is important to understand that in most cases it is not up to the housing authority whether it wants to negotiate an MOU. It is required to do so by law. See Question 8. While there is no one recipe for how to put together an MOU, it helps to understand where to start and what the process commonly involves. In general, there are four major steps recommended in creating an MOU:

1. Tenant group drafts its own MOU.
2. Tenant group gives its draft MOU to the housing authority.
3. Tenant group and housing authority meet to negotiate the terms of the MOU.
4. Tenant group and housing authority agree on final MOU.

What follows are some ideas about how to carry out these four major steps.

Tenant group drafts its own MOU

It is better for your tenant group to give the housing authority the first draft of an MOU than for the housing authority to give you the first draft. This way, the tenants establish the terms of the MOU and are “in the driver’s seat.”

You don’t have to start from scratch. You can use the sample MOU at the end of this booklet as a starting point. It will give you ideas about what to include. You can also find other sample MOUs on-line at www.MassLegalHelp.org . In addition, the Mass. Union of Public Housing Tenants can e-mail you the sample MOU or send it to you on a disk to save you lots of typing.

It is helpful to spend time polling tenants about what issues they care most about and weave these issues into the MOU. But keep in mind that because MOUs are very detailed and technical, it is hard to involve lots of tenants in the nitty-gritty of putting an MOU together. The process of developing an MOU, however, is a real opportunity to develop a more active tenant group.

Create an MOU committee of tenants who have the time and interest to read through the sample MOU and work on drafting. Then go through the sample MOU one section at a time. Add and delete provisions and talk about how to change it to best suit your situation. Take good notes so you remember what you talked about and agreed to. Make sure the issues that people care most about are in your MOU.

Draft your MOU with the changes people wanted to make. It is very helpful to have an attorney help you draft an MOU and be part of the MOU committee. An attorney can also review an MOU to make sure it complies with state and federal laws, covers the details that are important, and is clear in terms of enforcement. Every word matters in this kind of contract. To find a list of local legal aid offices, see the Directory at the end of this book.

Once the committee has drafted an MOU, meet again with the larger tenant group to review the proposed document. While it is time-consuming to keep people in the loop, it is worth it. Being inclusive keeps everyone more informed and involved, and establishes a good foundation for a strong tenant group.

Before you submit your draft to the housing authority, you may want to invite all tenants represented by the tenant organization to a meeting and go over the basic outline of the MOU. Be sure to allow time for questions and feedback.

Send your MOU to the housing authority

Hand deliver or mail your draft of the MOU to the Executive Director of your housing authority. Include a short cover letter requesting a meeting to discuss it.
See the sample letter in this booklet. Always remember to keep copies of everything you submit.

Be patient. Housing authorities rarely move quickly on MOUs.

If the Director does not respond within a reasonable time, call and ask to set up a meeting. Be polite, but persistent. Convey your determination to have a meeting. Most directors should be responsive.

Prepare to meet with the housing authority

Before you meet with the housing authority, make sure your group is prepared.

Decide who will go to the meeting and who will lead your negotiating team. Usually only one or two people act as speakers. Try to have a lawyer or other representative or advocate on your negotiating team. Having an outside person as part of the negotiation process can make a housing authority more accountable.

When or after you set up a time to meet with the housing authority, call to go over certain details that will help you be more prepared. For example, ask them who will be coming to the negotiating meeting so you can be prepared. Your housing authority may have whoever they want on their negotiating team. Ask them whether they can record the meeting so that everyone has a record of what was said. Make sure everyone is clear about the time and place for the meeting.

Begin to negotiate with the housing authority

Before you go to the meeting, talk about how you want to approach it. Often groups work through the draft MOU with the housing authority, paragraph by paragraph, exchanging ideas and concerns. This will likely require a series of meetings.
That’s OK. Remember, this is also about developing a relationship. You might want to start the meeting by talking about your overall goals, or about how state and federal regulations encourage housing authorities to work cooperatively with tenant organizations and how this can make your community better.

During any meeting with the housing authority, have one or more people take notes. Write down what the housing authority staff say, what you agree about, what you disagree about, and why. These notes will be important as a record of what was said and to help your group think through next steps. You may also share your notes with the housing authority to make sure there is agreement about what was covered.

Expect to compromise. Be clear about which items are your main concerns so you don’t lose sight of them. If you can, decide ahead of time which items you would be willing to change or give up. Make sure if you agree to a compromise or to work toward a compromise that it is clear who will re-draft the new proposed language. As stated above, it is usually better for you to do the re-drafting than to leave it to the housing authority. This gives you more control over how the compromise is crafted. The housing authority will often agree to this as it is less work for them.

During negotiations, don’t say “yes” and don’t say “no” to any final changes. Tell the housing authority that you will bring their requests for changes back to the tenant group for consideration. This gives your group time to figure out what to do. It shows the housing authority that there are more people involved than those in the room. And it prevents a small group of tenants from making decisions without consulting the larger tenant group.

At the end of your first meeting, set up your next meeting, and, if you can, a schedule of future meetings to continue to negotiate the MOU. This will keep the process moving and will later save a lot of time just trying to agree on when to meet.

For helpful tips on negotiating, see Questions 5 and 12.

Agree on the final version

As changes are agreed on, offer to make the actual changes on the document. If you have an attorney, ask him or her to make the changes. This will save the housing authority time and will continue to keep tenants in the driver’s seat.
Make sure the MOU is written in a way that will automatically renew each year unless either party requests new negotiations.
Let the tenant group approve the final MOU. Call a meeting of all tenants and review the changes made. Remember, as well as getting their OK, you are helping all residents know their rights, feel more comfortable participating in housing authority business, and take ownership in the MOU.
The final MOU should be signed by the president of the tenant organization, the Executive Director of the housing authority, and any tenant leaders, such as a
Vice President, Treasurer, or any Board member, who wish to sign.
Celebrate! Have a gathering to annouce the new MOU and recognize all those who worked on it. Distribute a flyer to all residents annoucing that the tenant group and housing authority have successfully negotiated a Memorandum of Understanding which will enable the resident organization to be more involved in matters that affect the community. Invite all tenants to the gathering and make a copy of the MOU available to all.

Footnotes

See Fall River Housing Joint Tenants Council, Inc. v. Fall River Housing Authority, et al.,
15 Mass. App. Ct. 992, 448 N.E. 2d 70 (1983). The court found that an MOU between the tenant council and the housing authority was written in a way that made it an enforceable agreement or contract.

Federal: 24 C.F.R. 964. State: 760 C.M.R. 6.09.

24 C.F.R. 964.18(a)(8). This applied to housing authorities with 250 units or more of federally funded public housing.

To see Boston Housing Authority’s local tenant organization tenant participation policy, go to: www.bostonhousing.org/pdfs/CSD2003LTOParticipation.pdf.

It is important for a tenant group to set up a good accounting procedure because HUD regulations require tenant associations to account for the use of housing authority funds and allow the housing authority to inspect and audit the tenant association’s financial records. 24 C.F.R. 964.150(b)(3).

Currently, the state provides $3 per unit (occupied or available for occupancy by tenants represented by the tenant council) per year or a total of $250, whichever is more, for residents’ participation. The housing authority may, however, agree to up to $6 per unit if the tenant organization convinces the housing authority of a need for additional funds. See 760 C.M.R. 6.09(3)(c).

Under federal regulations, a housing authority is required to request $25 per occupied unit per year for tenant participation when it submits its operating budget request to HUD. 24 C.F.R. 990.108(e). The amount that a housing authority must request can be found in Part D, lines 12 and 13 of HUD Form 52723, “Calculation of Operating Subsidy” form, which is the form the housing authority uses to request its operating subsidy. If the total amount of operating subsidy that a housing authority requests is reduced because of insufficient funds from Congress, the tenant participation funds are pro-rated and reduced proportionately. A housing authority must use funding allocated for tenant participation for tenant participation. It is also required to negotiate an MOU with the tenant organization about how tenant participation funds are to be used. For more about how these funds can be used, see HUD’s Notice 2001-3. For more information about tenant participation, see information produced by the National Housing Law Project in its Questions and Answers on Public Housing Resident Participation Fund, available at www.NHLP.org.
Note: Federal rules also provide that a housing authority may use its Capital Grant Program money to fund “capital expenditures to facilitate programs to improve the empowerment and economic self-sufficiency of public housing residents and to improve resident participation.” (Emphasis added.)
24 C.F.R. 905.10(k)(1)(viiii). Housing authorities may also use money from the Capital Grant Program for “reasonable costs necessary to assist residents to participate in a meaningful way in the planning, implementation, and monitoring process” in preparing the Comprehensive Plan, 5-Year Action Plan, and Annual Submission. 24 C.F.R. 968.112(a)(1)(iv).

Federal: 24 C.F.R. 964.135 (for housing authorities with fewer than 250 federal units). 24 C.F.R. 968.315, 320, 330, and 335 (for housing authorities with more than 250 federal units). Resident council members should be fully involved in all management operations, including modernization. See also 24 C.F.R. 964. State: 760 C.M.R. 11.10. A tenant organization must be given the opportunity to give input on a housing authority’s application for modernization funds and bidding documents.

> 760 C.M.R. 6.09 and 24 C.F.R. 964.18.

Federal: 24 C.F.R. 964.11. State: 760 C.M.R. 6.09(1).

Federal: 24 C.F.R. 964.18(a)(10) says that MOUs must be reviewed every 3 years. State: 760 C.M.R. 6.09(3) says that MOUs must be reviewed every 7 years.

Produced by Massachusetts Law Reform Institute

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