On Aug. 26, the U.S. Department of Housing and Urban Development (HUD or the Department) published a new notice detailing how new incremental general-purpose vouchers would be distributed and describing certain other operational provisions of the vouchers. The notice is titled “Allocation and Special Administrative Fee for New Incremental Housing Choice Vouchers” [PIH 2022-29 (HA)]. This $200 million in additional funding for vouchers was appropriated by the Consolidated Appropriations Act, 2022. The notices states that there will be 19,700 new Housing Choice Vouchers (HCVs) distributed to PHAs.
NAHRO thanks its members for educating decisionmakers in DC on the need and importance of new vouchers. In addition, in implementing the vouchers, NAHRO sent a letter to HUD urging the Department not to add additional terms or conditions to the vouchers, which may have made them harder to use. NAHRO is pleased that HUD has listened to NAHRO’s suggestion.
To be eligible for these new vouchers, a PHA must currently administer the HCV program through an existing Consolidated Annual Contributions Contract (CACC). Non-profit entities that administer Mainstream HCVs are not eligible for these vouchers.
The Department uses an allocation formula that is designed to look for need for the vouchers among extremely low-income and very low-income renter households. The formula also ensures that there is representation of both rural and urban areas. The formula weight can be broken down by the following factors: 1) the number of 0% to 50% Area Median Income (AMI) households overcrowded in the area; 2) the number of 0% to 30% AMI households with a severe cost burden, an overcrowding issue, or lacking a kitchen or plumbing; and 3) the number of 30 to 50% AMI households. The formula weighs each group at 10%, 75%, and 15% respectively.
The Department also created a maximum and minimum voucher amount per PHA. Each eligible PHA will be awarded at least 3 vouchers (to encourage small, particularly rural PHAs, to accept the vouchers). Any single PHA will have a maximum award of 450 vouchers to avoid overwhelming the capacity of an agency to lease vouchers swiftly. Finally, the Department will not set any special terms or conditions for the vouchers, but does encourage PHAs to “establish local preferences consistent with HCV regulations and statute to reach survivors of domestic violence, or individuals and families who are homeless . . . or at risk of homelessness . . . .”
Accepting or Declining the Vouchers
HUD should have already informed PHAs of their HCV award in late August. In that notification from HUD, it should specify the number of vouchers that each PHA has received. If a PHA determines that it does not want its award, it should send an email to NewHCVs@hud.gov by Sept. 2, 2022. If the PHA wishes to return its HCVs in the future, it should reach out to the same email address.
Housing agencies will be allocated administrative fees in two categories:
- One Time Lease Up Fee – HUD will award a single, one-time start-up fee of $750 per HCV allocated to the PHA once the PHA’s CACC is amended. This fee is meant to be used for start-up costs and to facilitate voucher lease ups.
- On-going Administrative Fee – PHAs will also be awarded additional administrative fee under the current admin. fee formula in use.
These vouchers must be reported in the Voucher Management System (VMS) in the same way as normal vouchers. They will be renewed in the same manner as well. These are not special purpose vouchers. Additionally, the funding from these vouchers must be used for the leasing of new admissions to the HCV program and cannot be used for HCV renewals or for the accumulation of reserves. Housing agencies are required to track the initial leasing of these vouchers and to document the spending of these funds to ensure that they were used for leasing new admissions.