HUD has released a new public interest waiver delaying the implementation of the Build America, Buy America Act (BABA) for most HUD programs. The implementation dates are as follows for the following programs and purchases.

2022

• Community Development Block Grants used for iron and steel: November 15, 2022;

2023

• Choice Neighborhood and Lead Hazard Control and Healthy Homes grants used for iron and steel: February 22, 2023;
• Recovery Housing Program grants used for iron and steel: August 23, 2023;

2024

• Choice Neighborhood and Lead Hazard Control and Healthy Homes grants used for construction materials and manufactured products: August 23, 2024;
• Community Development Block Grants used for construction materials and manufactured products: Fiscal Years 2024 and 2025;
• Recovery Housing Program grants used for construction materials: Fiscal Year 2024 and manufactured products: Fiscal Year 2025;
• All other HUD programs receiving Federal Financial Assistance used for iron and steel (not including HOME, Housing Trust Fund, and Public Housing funding used for maintenance): February 22, 2024; and
• All other HUD programs using Federal Financial Assistance (including for maintenance) for construction materials and manufactured products: August 23, 2024.

These dates apply to when funds are obligated by HUD to recipients. For example, only Public Housing Capital Fund dollars obligated on or after August 23, 2024 would fall under BABA requirements but those obligated before this date would not. Because the current public interest phased implementation waiver runs through February 21, 2023 and this new proposed waiver will not be effective until after its comment period ends March 2, 2023, funding obligated between these two dates would be subject to BABA requirements. However, HUD has informed NAHRO that the department will not allocate funding to agencies during this gap to ensure funds do not fall under BABA.

For more information about this waiver, see the waiver text here, NAHRO Direct News, and the February 28 edition of The NAHRO Monitor.

Comments due March 13, 2023

The Office of Management and Budget (OMB) has continued implementing the Build America, Buy America Act (BABA) by releasing a proposed rule that clarifies and revises BABA requirements.

First, the proposed rule seeks input on definitions of materials covered by BABA—construction materials, manufactured goods, and iron and steel—as well as “suggestions for reducing burden for recipients” of Federal Financial Assistance.

Second, the notice provides text of Part 184, an addition to 2 CFR chapter I, “Office of Management and Budget Governmentwide Guidance for Grants and Agreements.”

Find the notice here and see the Feb. 28 edition of The NAHRO Monitor for further details.  

Applications due April 13, 2023

HUD has combined Housing-related Health Hazards and Lead-Based Paint Capital Fund Program funding for public housing. PHAs may apply for grants to reduce “lead-based paint, carbon monoxide, mold, radon, fire, and asbestos.”

Find the application form on grants.gov here, the HUD press release here, and more information in the January 31^st edition of The NAHRO Monitor.

In PIH Notice 2022-38, HUD notes that PHAs who receive public housing Operating Fund or Capital Fund financial assistance will not report Section 3 data “until further notice.” HUD has not completed the new reporting system. HUD may still require PHAs to produce documentation, so PHAs must continue to retain it on-site.

This notice’s reporting changes do not apply to housing and community development projects, such as the RAD post-conversion, Choice Neighborhoods, CDBG, HOPWA, HOME, Housing Trust Fund, and Section 202 and 811 projects.

For more information, see the January 15, 2023 edition of The NAHRO Monitor. Find PIH Notice 2022-38 here.

On December 14, 2022, HUD finalized three waivers for implementing the Build America, Buy America Act (BABA), moving the compliance date to February 21, 2023 for most  programs except for those using Community Development Block Grant (CDBG) funds to purchase iron or steel.

Public Interest Phased Implementation Waiver — This waiver will delay implementation of BABA for funds allocated before February 21, 2023 except for CDBG money used to purchase iron or steel with funding allocated after November 13, 2022.

Public Interest De Minimis Waiver — The de minimis waiver would exclude small projects, projects completed with small sums of money, or small portions of large projects from complying with the BAP. HUD finalized $250,000 as the de minimis threshold for applying the BAP or five percent of a covered project up to $1 million. This waiver applies for up to five years from November 23, 2022.

Public Interest Exigent Circumstances Waiver — The exigent circumstances waiver would exclude projects that protect resident health and safety from compliance with the BAP. This waiver applies for up to five years from November 23, 2022.

Find finalized versions of each waiver here and NAHRO’s full comment letter for each of these three waivers here.

PHAs have until April 30, 2023 to finish liquidating any CARES Act obligations used for supplemental Public Housing Operating Funds. PIH Notice 2022-35 updated the deadline to complete the liquidation process to the new date in April 2023. However, it did not modify the Dec. 31, 2021 CARES Act obligation deadline. In addition to liquidating obligations by April 30, 2023, PHAs who reported obligations that have not been liquidated on their SF-425 form must submit another by the April deadline showing that this process is complete. Those funds that were not obligated on the previous SF-425 have been recaptured, and any funds unliquidated by April will also be recaptured. Finally, HUD notes that CARES Act funds have been unavailable to draw down since April 30, 2022. The notice provides guidance for requesting additional CARES Act funds since April 2022 and which obligations are eligible.

Find PIH Notice 2022-35 here.

PIH Notice 2022-36 updates Public Housing Operating Fund subsidy grant calculation requirements, including deadlines for PHAs. Since the previous notice in December 2021, this notice revises requirements for using the System for Award Management (SAM), updates utility data calculations, and updates resources and guidance for 2023.

This notice provides guidance covering the following topics:

• exemptions from asset management requirements;
• initial eligibility estimates and eligibility calculations for 2023 funding;
• new Unique Entity Identifier requirements within SAM;
• information submission processes, including project regrouping, clarification of which data PHAs can edit, and updating unit status;
• requesting revision to operating subsidy eligibility;
• a detailed explanation of operating subsidy grant calculations;
• other requirements, including environmental reviews, Moving to Work agreements, and General Depository Agreements, and general requirements;
• the appeals process based on appeal type;
• program requirement for the Rental Assistance Demonstration, Turnkey III, and Envision Center participation; and
• Faircloth limit guidance.

The notice provides useful links, including the Operating Subsidy Grant Processing Webpage, Operating Fund Web Portal, and Operating Subsidy Grant Listserv. The grant processing webpage organizes 2023 Operating Fund documents, the web portal provides deadlines as well as electronic tools and other resources, and the listserv webpage allows PHAs to sign up for mass emails as well as operating fund data from previous years.

For more information about this notice, see the December 15^th issue of The NAHRO Monitor. Find Notice 2022-36 here.

HUD has released PIH Notice 2022-33 (HA), which updates guidance for flat rents and flat rent exception requests in public housing. PHAs can request to set flat rents lower than 80% of the Fair Market Rent or Small Area Fair Market Rent if they submit a market analysis and HUD concurs that PHAs should lower rents. This guidance covers applying for and extending flat rent exceptions, program compliance, phasing in flat rents, and rent options for families.   

Additionally, HUD has published PIH Notice 2022-34. This notice updates the prior 2019 guidance on the Rate Reduction Incentive program (RRI) in public housing and several related utility and Operating Fund programs. The RRI allows PHAs to retain a portion of cost savings from specific types of practices that decrease utility rates. The notice modifies and makes additions to RRI eligibility, request, and calculation processes. It also describes program requirements for participating PHAs.

For more information about each notice, see the December 15 edition of The NAHRO Monitor. Find Notice 2022-33 (HA) here and Notice 2022-34 here.

On Monday, HUD reminded PHA executive directors of unusual Public Housing Capital Fund obligation and expenditure deadlines for 2018-2020 and 2021 grants. In short, the 2021 formula grants have obligation and expenditure deadlines that fall before 2019-2020. HUD notes that Most PHAs did receive an extension for their 2018-2020 Capital Fund grants. However, these waivers did not apply to 2021 or beyond. This means that 2021 grant dollars, which were allocated in February of that year, have deadlines in February of 2023, just prior to 2019 funds. PHAs should be sure to use funds with the earliest deadlines first. HUD also notes that extensions can be granted according to the Capital Fund Guidebook.  The nearest obligation dates include the 2021 formula grant: February 22, 2023 and 2019 formula grants: April 15, 2023. The nearest expenditure deadlines are 2019’s emergency grants: January 1 and April 8, 2023.

More information can be found in the upcoming edition of the NAHRO Monitor.

HUD has released a waiver delaying the implementation of the Build America, Buy America Act (BABA) for all HUD programs—aside from CDBG—for 90 additional days until February 15, 2023. This public interest phased implementation waiver is expected to be the final before BABA enters full effect and follows two additional public interest waivers last week. The waiver notes that fully implementing BABA for all programs simultaneously may harm HUD funding recipients’ ability to function because most have never experienced a Buy America Preference (BAP) before.

This waiver excludes Community Development Block Grant (CDBG) programs using iron or steel, so any CDBG funds obligated as of November 15, 2022 and used for that purpose are subject to the BAP. HUD explains that they wish to better implement BABA for remaining HUD programs based on lessons learned from this program.

NAHRO is pleased to see this waiver as part of HUD’s effort to ensure an effective implementation of BAP requirements. Although NAHRO is committed to prioritizing U.S. jobs and manufacturers, NAHRO remains concerned about increased costs to affordable housing development and what reporting and compliance may look like for projects that must meet the BAP.

Additional information from HUD and analysis from NAHRO will be forthcoming. Please see NAHRO Direct News, The NAHRO Monitor, and NAHRO’s Comment Letter and Correspondence page for more.

Find the public interest phased implementation waiver here. Comments on this waiver are due November 17.