HUD has released it’s detailed calculation of Operating Fund subsidy for June 2017. PHAs can examine the details to HUD’s calculation in determining Operating subsidy for June at the PHA level. In June, HUD is increasing the proration for the Operating Fund from 85 percent to a 92.89 percent proration.
The proration represents a cumulative amount for the year. Since PHAs received payments based on a lesser yearly proration for the first few months of the year, June’s payment will be greater to compensate for the initial underfunding. This is known as a “true up.” As such, many PHAs may see a significant increase in Operating Fund subsidy in June as a result of this true up.
The July payment will more accurately represent the new monthly amount under the new proration. The letter notes that there may be minor proration fluctuations and that “[t]he final proration will be established after final eligibility is determined for all projects.”