Yesterday, HUD and the United States Department of Veterans Affairs (VA) announced a second round of HUD-VASH funding. HUD-VASH combines vouchers from HUD with case management and clinical services provided by VA. Since 2008, more than 79,000 vouchers have been awarded. This round of funding provides 108 vouchers and $871,056 worth of funding.
A list of PHAs that have been awarded HUD-VASH vouchers can be found at HUD’s press release here.
On August 23, HUD will publish a 30-day notice in the Federal Register seeking public feedback on the Local Government Assessment Tool, the instrument with which communities receiving HUD Community Planning and Development (CPD) formula grant dollars must use to conduct and submit their Assessment of Fair Housing (AFH) analysis, as required by the Affirmatively Furthering Fair Housing (AFFH) Final Rule.
Due to limited staff and resources, NAHRO has long-requested for HUD to streamline the AFFH assessment tools for small program participants. The 30-day Notice announces two substantial changes that would, ideally, help simplify the AFH process for Qualified Public Housing Authorities (QPHAs), defined as PHAs not designed as “troubled” with a combined unit total of 550 or less, and for local governments receiving small CPD formula grants:
The 30-day notice also addresses the public comments received in response to the 60-day information collection notice that was published on March 23, 2016 (see NAHRO’s comments here). NAHRO’s next issue of The Monitor (members only) will have additional details about the contents of the 30-day notice.
On August 19, the United States Government Accountability Office (GAO) made publicly available a report it wrote for congressional requesters. The report found that HUD has “not consistently incorporated requirements and key practices identified by GAO to help ensure effective management into its operations.”
The report identified five management functions and discusses how completely HUD implemented prior GAO recommendations. Selected excerpts can be found below:
Performance planning and reporting – “HUD met most of the requirements in the GPRA Modernization Act of 2010 for its strategic plan and annual performance plan and report . . . [b]ut HUD’s strategic plan does not clearly link HUD’s goals and objectives with federal priority goals.”
Information technology management – “HUD has not demonstrated that it has the capacity to effectively plan for and manage IT projects.”
Human capital management – “HUD has made progress in developing new human capital plans and mostly followed key principle and practices for strategic workforce planning, succession planning, and training planning.”
Financial management – “HUD did not follow seven of eight key practices for financial management.”
Acquisition management – “HUD partially followed key practices for acquisition relating to organizational alignment and human capital.”
The report recommends that HUD take the following eight actions:
Thanks to PHADA for bringing this report to our attention.
The full report can be found here. The PDF can be found here.
The highlights page can be found here.
Our friends at the National Housing Conference (NHC) and the Public Housing Authorities Director’s Association (PHADA) have written a blog post with a series of beautiful maps on historical Small Area Fair Market Rent (SAFMR) volatility on NHC’s Open House Blog. Here’s a map from the blog post on the Washington-Arlington-Alexandria HUD Metro Fair Market Rent (FMR) area.
I recommend looking at the blog post to read their take on SAFMRs and volatility and to see the other maps.
Here are a couple of points that I would like to note to further this conversation.
The methodology for calculating Fair Market Rents (and SAFMRs) is changing
In calculating the final FY 2016 FMRs HUD switched from a “historical-based annualized change in gross rent trend factor [to] a forward-looking forecast . . . [that] uses a model that forecasts national rent and utility [Consumer Price Index] indices based on economic assumptions used in the formulation of the President’s Budget.”[1] Since the methodology has changed, we need a time horizon of a few years to see if the volatility remains as bad a problem as before the methodological change.
Additionally, Peter Kahn, the Director of HUD PD&R‘s Economic Market Analysis Division, has stated the following:
We are looking at ways throughout the proposed ’17 FMR process of addressing that . . . variability in general. When the proposed ’17 FMRs are out, the . . . you can read that preamble and see that we are trying to take steps to address that variability. (See the YouTube clip where he said that here.)
Will HUD be successful in addressing this volatility? I don’t know, but it’s good that they’re aware of the problem and are taking steps to address the issue.
The passage of the Housing Opportunity Through Modernization Act of 2016 (HOTMA) may give PHAs a tool in managing volatility of payment standards based on both FMRs and SAFMRs
HOTMA has a provision that allows PHAs to hold harmless households that live in areas that receive lower FMRs. Section 107(b) of HOTMA states that “no public housing agency shall be required as a result of a reduction in the fair market rental to reduce the payment standard applied to a family continuing to reside in a unit for which the family was receiving assistance . . . at the time the fair market rental was reduced.” It is NAHRO’s understanding that this provision will apply to payment standards based on FMRs and SAFMRs.
The chart below shows how if a provision allowing for payment standards to be held harmless was in place between 2010 and 2016, then volatility may have been reduced in some instances. The blue line shows the actual Washington-Arlington-Alexandria FMR for 2 Bedroom units. The orange line shows what a payment standard based on that FMR would have been, had it been held harmless.
The HOTMA provision has the ability to reduce volatility in certain instances, though holding FMR payment standards harmless may have budget implications. Another point to remember is that when the payment standard starts being held harmless matters. In the chart above, if the payment standard starts being held harmless in 2013, then the volatility that results from increases in the FMR will still occur.
Although the chart above shows a payment standard based on a FMR being held harmless, the same principle would apply to payment standards based on SAFMRs.
[1] – 80 Fed. Reg. 77,124 (December 11, 2015).
On Aug 19, NAHRO submitted comments to HUD regarding their 30-Day Notice of Proposed Information Collection on Executive Compensation Information and HUD Form 52725. The letter states that although NAHRO understands HUD’s statutory requirement to collect information on executive compensation, we remain concerned about the usefulness and relevance of this data collection and its implications regarding the value and merit of operating a PHA, an increasingly difficult and understaffed job. HUD Form 52725 erases meaningful differences among executive roles at varying PHAs, and assumes organizational and governance structures of PHAs are the same across the country.
In this time of budget cuts and ever-increasing regulatory and funding uncertainty, NAHRO is particularly disappointed that the Department continues to devote its oversight resources to efforts such as this that have little or no value rather than focusing on pursuing meaningful regulatory reform that will streamline the delivery of housing and services to low-income Americans.
NAHRO’s letter is available here (members only).
President Obama has issued a disaster declaration for 20 parishes affected by the historic flooding in southeastern Louisiana. This qualifies individuals and local governments for assistance that can help clean-up and rebuild. Furthermore, the President’s declaration allows HUD to offer relief and other assistance to families living in affected areas.For more information on this assistance, please see HUD’s press release here.
As this is a presidentially declared natural disaster, housing authorities in the region will not be eligible to use emergency capital funds to address any damages resulting from the floods. Rather, emergency funding will be made available through the Federal Emergency Management Agency (FEMA). Please visit www.disasterassistance.gov to apply for assistance.
NAHRO is keeping those affected by this disaster in our thoughts. For those of you in the affected area, please stay safe.
Today, HUD published a notice (PIH 2016-12) titled “Funding Availability for Tenant-Protection Vouchers for Certain At-Risk Households in Low-Vacancy Areas — Fiscal Year 2016.” The notice makes available the $5 million set-aside for “certain at-risk households in low-vacancy areas for Fiscal Year (FY) 2016” from the $130 million appropriated for Tenant Protection Vouchers (TPVs) in general.
The $5 million in TPV assistance is available for the purpose of assisting “residents residing in low-vacancy areas and who either are or may have to pay rents greater than 30 percent of household income” because of the following:
The TPV assistance may be provided as either enhanced vouchers or project-based voucher (PBV) assistance.
NAHRO’s next issue of The Monitor (members only) will have additional details on the notice.
The full notice can be read here.
The Urban Institute and National Housing Conference have published an interactive and educative tool, “The Cost of Affordable Housing: Does It Pencil Out,” that demonstrates the huge gap between what it costs to build and maintain affordable housing and the affordable rent that low-income families can pay, making it difficult to finance affordable housing without additional subsidy. Aimed at policymakers and those new to the affordable housing world, users can play with the tool by changing specific variables on development costs and see how a development’s funding gap can be closed. The tool spotlights the importance of federal programs that support affordable housing, such as the Low-Income Housing Tax Credit (LIHTC) – which is the largest source of capital supporting the affordable housing inventory in the United States.
The formidable gap in financing affordable housing development is why it is important for the public to call on Congress to pass Sen. Maria Cantwell’s (D-Wash.) and Sen. Orrin Hatch’s (R-Utah) Affordable Housing Improvement Act of 2016. This legislation would expand the overall LIHTC allocation authority by 50 percent and make permanent the 4 percent Housing Credit rate. For more information on this legislation, visit NAHRO’s Community Development Resource Center (log-in required) to access a one-pager on the bills.
NAHRO has submitted comments on HUD’s notice titled “Establishing a More Effective Fair Market Rent System; Using Small Area Fair Market Rents in Housing Choice Voucher Program Instead of the Current 50th Percentile FMRs.”
HUD’s proposed rule would mandatorily impose the use of Small Area Fair Market Rent (SAFMR) areas in 31 metropolitan areas, if it were implemented as currently written.
In NAHRO’s comments, we stated that PHAs should have the discretion to use either SAFMRs or FMRs depending on what made sense in a PHA’s rental housing market. NAHRO’s reasons to oppose the mandatory imposition of SAFMRs in certain areas can be divided into three broad categories: tenant welfare concerns; tenant choice concerns; and administrative burden concerns. NAHRO also noted that additional research needed to be done before mandatorily implementing SAFMRs and responded to specific solicitations about the rule from HUD.
Read NAHRO’s SAFMR comments here.
Read the proposed rule here.
Read NAHRO’s prior post on HUD’s SAFMR proposed rule here.
NAHRO’s Acting CEO, John Bohm, and the NAHRO Policy Team members; Georgi Banna, Eric Oberdorfer and Tushar Gurjal; along with PHADA and CLPHA met with HUD’s Public and Indian Housing Principal Deputy Assistant Secretary (PDAS), Lourdes Castro-Ramierz, and many of the PIH department leadership.
Among the topics discussed were the priorities for implementing the Housing Opportunities Through Modernization Act (HOTMA/HR 3700); upcoming HUD rules such as Smoke-Free Housing, Small Area Fair Market Rents (SAFMRs), HCV Administrative Fee Formula; Moving to Work (MTW) Expansion; and Triennial Recertifications; and the current priorities of NAHRO, PHADA, CLPHA and HUD. NAHRO and CLPHA were also thanked for their current and continued work in affordable housing and education and the improvement of educational outcomes for the children our members serve.
NAHRO is committed to keeping open and productive lines of communication and will continue to share the thoughts and concerns of our members with HUD.
The NAHRO Blog: Legislative & Policy Updates from Washington, DC 