The final Scoring Notice for HUD’s National Standards for the Physical Inspection of Real Estate (NSPIRE) protocols was published in the Federal Register on July 7. For HUD multifamily housing, the NSPIRE physical inspection protocols go into effect on October 1, 2023.

There are four main pieces to HUD’s final package of NSPIRE materials. In addition to the July 6 release of the final Scoring Notice, HUD issued the final overall NSPIRE final rule on May 11, the final NSPIRE Standards 3.0 Notice on June 16, and the NSPIRE “administrative procedures” notice on June 30, which outlines the updated NSPIRE process for inspection, including the process HUD will use to gather resident feedback on property conditions.

HUD’s July 6 final scoring notice reflects comments LeadingAge provided on HUD’s proposed scoring notice. Specifically:

Removal of Point-Loss Cap: In our comments to HUD on its proposed scoring notice, LeadingAge pushed back on HUD’s proposal to deduct points for each repeated infraction of the same standard (for example, a cap that was screwed on incorrectly every single time). Removing the “point loss cap,” LeadingAge argued, could leadto high point loss due to a single type of deficiency repeated throughout the property. In the final scoring notice, HUD agreed. As a compromise, HUD will score the same type of deficiency in every venue it is found (the three venues: the unit, the building, and outside) but not more than once for each venue. Examples of deficiencies that will be cited for each instance but scored only once in the same inspectable area include blocked egress, damaged doors, damaged walls, sharp edges, and infestation. “This revision takes into consideration concerns expressed in public comments while upholding HUD’s focus on resident health and safety as standards for acceptable living conditions,” HUD’s final notice says.

Acknowledgement of In-Unit Condition Pickle: LeadingAge’s scoring comments expressed support for HUD’s new inspection emphasis on in-unit conditions, as they have the greatest impact on resident health, safety, and quality of life, while asking HUD to balance the scoring of in-unit standards with the fact that owners have the least control over these standards. HUD’s proposed scoring notice acknowledged resident adjustments to smoke detectors and carbon monoxide detectors and said deficiencies in these items would be noted and must be corrected, but will not be scored. In our comments, LeadingAge urged HUD to go further and “expand the list to include pull cords” and other call-for-aid systems, which are commonly adjusted by residents. In its final scoring notice, HUD agreed to LeadingAge’s request. Some “items, such as call-for-aid systems may be present in units but not currently used by the building management and have been modified or damaged by the tenant or their cat, for example, and will also not be scored. Otherwise, call-for-aid systems that are in use by the building management will continue to be scored,” HUD says in the final scoring notice. Per the final scoring notice, these items are not to be scored in units, but to be noted and must be corrected: carbon monoxide devices, smoke alarms, call-for-aid systems that are blocked or where pull cord is higher than six inches off the floor, and handrails.

Phase-In of New Safety Standards: LeadingAge’s comments also urged HUD to extend its 12-month phase-in for new affirmative safety standards. “Rather than implementing the proposed 12-month phase-in for new affirmative safety standards, REAC should strongly consider implementing a non-scored phase-in policy for each property’s first official NSPIRE inspection,” LeadingAge said. “HUD understands that it may take properties’ ownership and management some time to comply with these new affirmative requirements; hence, HUD will not score new affirmative requirements, which are defined as those standards that were expressly not in the UPCS or in any way covered by those standards, in at least first 12 months of NSPIRE inspections for the program from the later effective date, ending October 1, 2024 for public and Multifamily Housing programs. HUD will also not score fire doors during this period, since the Fire Door NSPIRE Standard is new and properties may need to replace doors to meet the standard,” HUD said in the final scoring notice. Items that will not be scored until at least October 1, 2024, include fire labeled doors, GFCI outlets, guardrails. For HVAC systems, the final notice spells out a phased in approach for interior heating source and temperature minimums.

Scoring Designations: In the final scoring notice, HUD supplements a property’s zero to 100-point score with the following designations that provide property ownership and/or management, residents, and other stakeholders with information important to understanding the overall inspection results. These designations include:

• Smoke Detectors: An asterisk (*) next to the property’s zero to 100-point score indicates whether an inspector observed a smoke detector defect during an inspection. Carbon Monoxide Detectors: A plus sign (+) next to the property’s zero to 100-point score indicates whether the inspector observed a carbon monoxide detector defect during an inspection.
• Presence of Certain Defect Severity Levels: HUD previously provided a letter designation (e.g., a, b, c) to indicate the presence of exigent health and safety defects; NSPIRE does not use such letter designations. HUD instead provides a summary table of the defect observations by Defect Severity Category, e.g., Life-threatening, Severe, Moderate, and Low. At the conclusion of the inspection, the PHA or Owner will receive a list of Life-threatening and Severe items that must be corrected within 24 hours of the inspection.
• Certain New Requirements: Until at least October 1, 2024, new requirements that were not scored will be flagged with a caret (^) symbol. Standards that may need more calibration through field testing, such as a minimum temperature standard, may be not scored for more than a year. In at least the initial year of NSPIRE, HUD will also provide two scores; one that shows the potential score if new requirements were scored, and the official score for that inspection.

No Letter Grades: In the final scoring notice, HUD says it will not issue letter grades for inspections.  HUD will continue to only issue scores on the 0-100 point scale.

NSPIRE Scoring Calculator: HUD will update its NSPIRE scoring calculator to reflect for the most recent NSPIRE Standards 3.0 and the final scoring model. Find the calculator on HUD’s Real Estate Assessment Center NSPIRE website here.

Regular Review of Standards and Scoring: In the NSPIRE rule, HUD stated its intent to publish updates to the NSPIRE standards and scoring methodology through future Federal Register notices at least once every three years with an opportunity for public comment. LeadingAge will continue to be actively involved, with our members and with HUD, on NSPIRE’s implementation and continual improvement.