Condition and appearance deficiencies are those where components of the property do not meet reasonable expectations of condition and appearance or are damaged. This category includes deficiencies where HUD or the property could suffer reputational harm, or where a resident could incur additional costs because of this condition.

A condition and appearance deficiency is not likely to harm a resident, nor does it critically reduce or eliminate an object's usability. This category of deficiency requires repair based on the property's routine maintenance plan. Note that other, less significant "appearance" deficiencies, such as peeling non-lead-based paint inside a unit, may not be included.

1. Any individual or other legal entity that:
   1. Directly or indirectly (e.g., through an affiliate), submits offers for or is awarded, or reasonably may be expected to submit offers for or be awarded, a Government contract, including a contract for carriage under Government or commercial bills of lading, or a subcontract under a Government contract; or
   2. Conducts business, or reasonably may be expected to conduct business, with the Government as an agent or representative of another contractor. (FAR 9.403)
2. Includes the terms prime contractor and subcontractor. (FAR 22.801)
3. Includes a subcontractor at any tier whose subcontract is subject to the provisions of the Services Contract Act. (FAR 22.1001)
4. For subcontracting requirements, the total contractor organization or a separate entity of it, such as an affiliate, division, or plant, that performs its own purchasing. (FAR 44.101)

A function and operability deficiency eliminates or critically reduces an object's usability, but the deficiency alone is not likely to directly harm a resident. Function and operability deficiencies are those where the resident is unable to use certain fixtures, features, or appliances. These are items which are reasonably assumed to be part of their rent.

This type of deficiency may be citable when a resident would incur additional costs because of this condition; for example, a sink that is constantly running. A function and operability deficiency may increase the resident's utility bill significantly if not corrected. These deficiencies require repair based on the property's routine maintenance plan.

Created as part of President Lyndon B. Johnson's War on Poverty, the Department of Housing and Urban Development (HUD) was established as a Cabinet Department by the Department of Housing and Urban Development Act (42 U.S.C. 3532-3537), effective November 9, 1965. It consolidated a number of other older federal agencies.

The Department of Housing and Urban Development is the Federal agency responsible for national policy and programs that address America's housing needs, that improve and develop the Nation's communities, and enforce fair housing laws. HUD's business is helping create a decent home and suitable living environment for all Americans, and it has given America's communities a strong national voice at the Cabinet level. HUD plays a major role in supporting homeownership by underwriting homeownership for lower- and moderate-income families through its mortgage insurance programs.

The primary programs administered by HUD include:

• Mortgage and loan insurance through the Federal Housing Administration
• Community Development Block Grants (CDBG) to help communities with economic development, job opportunities and housing rehabilitation
• HOME Investment Partnership Act block grants to develop and support affordable housing for low-income residents
• Rental assistance in the form of Section 8 certificates or vouchers for low-income households
• Public or subsidized housing for low-income individuals and families
• Homeless assistance provided through local communities and faith-based and other nonprofit organizations
• Fair housing public education and enforcement

HUD's new housing inspection approach, under development, that prioritizes health, safety, and functional deficiencies over those about appearance. NSPIRE is a single inspection standard for all units under the Public Housing, HCV, Multifamily, and Community Planning and Development (CPD) programs. NSPIRE's focus is on the areas that impact residents the most, such as the dwelling unit. This model includes objective and clearly stated standards, value-added inspection protocols, and scoring elements that are more defensible and less complex.

NSPIRE is intended to better identify public housing agencies (PHA) and property owners and agents (POA) that are not adhering to minimum compliance standards by:

• Establishing objective, well-defined deficiency definitions developed, tested, and validated in a rigorous collaboration with stakeholders such as PHAs, POAs, resident groups, public health experts, and academics during the NSPIRE Demonstration;
• Requiring properties to complete and submit their annual self-inspection results electronically;
• Incorporating less complex inspection protocols using indicators aligned to quality;
• Reducing the number of inspectable areas at properties to simplify the process and reduce administrative errors related to deficiency misclassification by regrouping the inspectable items into three categories from five—note that this only changes the grouping of inspectable items; it does not change which items are being inspected;
• Deliberately grouping deficiencies into one of three categories;
• Identifying all health and safety (H&S) deficiencies; and
• Adopting a new scoring model that places emphasis on the residents' homes.

The NSPIRE Model has three major components: (1) Three types of inspections, (2) three categories of physical deficiencies, and (3) three inspectable areas.

The three types of inspections include self-inspections (see Self-Inspection); NSPIRE inspections (see NSPIRE Inspection); and NSPIRE Plus inspections (see NSPIRE Plus Inspection). Note that the Housing Choice Voucher program is only required to have NSPIRE inspections.

The three categories of deficiencies are health and safety; function and operability; and condition and appearance, with each category ideally resulting in emergency work orders, routine work orders, and other maintenance respectively.

The three inspectable areas are Inside, Outside, and Unit. "Inside" refers to all common areas and building systems (e.g., HVAC) located inside a building, but not within dwelling units. "Outside" refers to the building site, the building envelope, and any building systems located outside of the building or unit. "Unit" refers to the interior of an individual residential unit.

The transition to these three major components will decrease inspection complexity, simplify the scoring model, and increase consistency in the way the standards are interpreted and protocols are applied during an inspection.

A method of inspecting HUD-assisted properties using video streaming technology. Using RVI, a housing inspector at a remote location is assisted by a person at the property who serves as a proxy for the inspector. The proxy walks the property as directed by the inspector, streaming video to the inspector of various inspectable items so that the inspector can assess property conditions.

RVI is a way to use technology to complete an inspection without the inspector being on-site. It helps public housing agencies (PHA) overcome inspection challenges now, in a time of global pandemic, and in the future. A successful RVI program provides the same assurance as an in-person Housing Quality Standards (HQS) inspection.

The severe health and safety category includes deficiencies that, if evident in the home or on the property, present a high risk of death, permanent disability, or serious injury or illness to a resident; or that the physical security or safety of a resident or their property would be seriously compromised.

Severe health and safety includes life-threatening and severe non-life-threatening categories.