Operating Fund Shortfall Application Released

On July 28, HUD released Notice PIH-2020-16 “Implementation of Public Housing Operating Fund Shortfall Funding from Federal Fiscal Year (FFY) 2020 Appropriations.” The 2020 Appropriations Act set aside $25 million of the Operating Fund to be allocated to public housing agencies that experience insolvency. This set-aside will be distributed via a need-based application process not subject to the Operating Fund formula. HUD may distribute any remaining funds to all public housing agencies on a pro-rata basis after all insolvency needs are met. The notice provides guidance regarding eligibility, the process for applying, and other requirements for the $25 million set-aside of Public Housing Operating Funds to assist PHAs experiencing financial insolvency.¬†

HUD is providing a simplified application process to expedite distribution of Shortfall funding to PHAs. PHAs can check here to see if they’re eligible to apply. If a PHA believes they should be eligible to apply but are not included in HUD’s list, they may appeal to HUD by emailing 2020ShortfallAppeal@HUD.gov by midnight ET August 26.

Eligible PHAs should complete the Shortfall application found in Appendix A of the Notice and submit it via email to 2020ShortfallFunding@hud.gov. Applications should be received by HUD no later than midnight ET on August 26 and should be submitted by the PHA’s Executive Director or other authorized representative and include the PHA’s name and PHA code and contact information for follow-up if necessary. Due to limited funds available, HUD will distribute applicants into two tiers, those with an MOR (Months of Operating Reserve) under zero and those with an MOR under two. Those with an MOR under zero will be funded first. If additional funding remains, HUD will fund those with an MOR under two.

HUD will undertake additional monitoring activities of all PHAs that receive Shortfall funding to ensure financial solvency. HUD will also provide a list of activities PHAs can take to improve their financial performance. The list will not be specific to any PHA, but includes a list of operational improvements that HUD has historically recommended to insolvent PHAs.

All Shortfall funds can be used for eligible Operating Fund activities.

HUD’s notice can be found here.


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