Day: October 4, 2016

HUD Releases Guidance on PHA Salary Restrictions

~ Eric Oberdorfer ~ Leave a comment

On October 3, HUD PIH Issued Notice PIH-2016-14 (HA) titled, “Guidance on the Public Housing Agency (PHA) salary restriction in HUD’s annual appropriations.” Congress prohibits PHAs from using any Tenant-Based Voucher, Operating Fund, or Capital Fund dollars to pay any amount of salary above the base rate of pay for level IV of the Executive Schedule. To fulfill its obligations under HUD’s annual appropriations, each PHA must compute the amount of impacted salary and bonus for each covered individual during the PHA’s fiscal year. If any covered individual has a salary and bonus that exceeds the annual rate of basic pay for a position at level IV of the Executive Schedule, the PHA must ensure that the amount in excess is not paid from Section 8 or Section 9 funds. Covered individuals include the “chief executive officer” as well as “any other official or employee” of the PHA with an annual salary (including any bonus) greater than the then prevailing salary for level IV of the Executive Schedule.

PHAs should calculate excess salary and bonuses reasonably and should document the calculation so that, if audited, the PHA can explain how each covered individual’s salary and bonus exceeding level IV of the Executive Schedule for that fiscal year were funded and prove to the auditor that there was no improper use of the applicable Section 8 or Section 9 monies to fund excess PHA salary and bonus payments.

For more information on this requirement, see NAHRO’s coverage of the FY16 Omnibus (members only).

HUD OIG Releases Report on Oversight of MTW Legal Costs

~ Eric Oberdorfer ~ Leave a comment

On September 29, HUD’s Office of Inspector General issued a report titled “HUD’s Oversight of Legal Costs at Moving to Work Housing Agencies.” The report found that HUD’s oversight was not adequate to ensure that legal costs spent by MTW agencies were reasonable and necessary.  OIG audited HUD on this topic due to congressional concerns, concerns from a previous external audit, and OIG’s initiative to focus HUD management’s attention on problem areas on which we and others have reported over the years.

According to the report, which audited 3 MTW agencies, payments for outside legal services paid for by the MTW agencies were not always in compliance with applicable requirements. The report claims that $9.2 million of the $16.5 million that the three agencies paid for outside legal services during the period October 2007 to September 2012 could be unsupported. The report notes that MTW agencies typically incur relatively higher costs for legal services than non MTW agencies.

OIG recommends HUD require MTW agencies to include a breakdown of their anticipated and actual costs for legal services in their annual plans and report.