The National Housing Law Project (NHLP) and the Poverty & Race Research Action Council (PRRAC) have written a document titled “New Options to Increase Housing Choice Voucher Payment Standards.” Typically, a PHA can set its payment standard at between 90% to 110% of the Fair Market Rent (FMR). This document provides information on instances where PHAs can set payment standards up to 120% (or use 50th percentile FMRs, which are set higher than normal FMRs).
The document provides the following summarized information on payment standards and FMRs (see the full document for details):
- PHAs can establish payment standards higher than 110% when implementing a reasonable accommodation for a family that includes a person with a disability. The PHA may establish an exception payment standard up to 120%.
- By request of a PHA, HUD may approve an exception payment start for a designated part of an FMR area (i.e., an exception area) where the total population of the HUD-approved exception area does not exceed 50% of the population of the area.
- PHAs may request FMRs be calculated at the 50th percentile rent (normally FMRs are calculated at the 40th percentile rent–i.e., they are set so that about 40% of the available housing stock in a given geography is accessible to renters) to establish a higher success rate for their voucher program. The PHA will be able to set the payment standard at 90% to 110% of the 50th percentile rent.
- In instances where the PHA previously had a 50th percentile FMR and now has a 40th percentile FMR, HUD may approve a payment standard amount based on the 50th percentile rent, if the PHA scored well on the SEMAP (Section Eight Management Assessment Program) deconcentration bonus indicator.
- PHAs may be able to set payment standards up to 120% through the use of waivers in the Notice PIH 2022-09.
- PHAs that voluntarily use Small Area FMRs can set a payment standard up to 120% of the Small Area FMR using Notice PIH 2022-09.
- PHAs that mandatorily use Small Area FMRs can set a payment standard up to 120% of the Small Area FMR using Notice PIH 2022-09.
- PHAs with Moving to Work (MTW) status can use their MTW flexibilities to set higher payment standards.
The document provides additional information and citations to the appropriate regulatory provisions and guidance documents.
The full document can be found here.