On January 17, HUD released it’s 2018 Public Housing Management Fee Table. PHAs may use the amounts published in the table to establish “reasonable” fees for each of their public housing projects. Some PHAs may see a decrease from the 2017 schedule. Fees in the fee table have already been adjusted for occupancy. Nationally, the 80th percentile management fee is $60.46 per unit month (PUM).

HUD has posted it’s updated schedule for Calendar Year (CY) 2018 Operating Subsidy Process to the CY 2018 Operating Subsidy Processing Webpage.

HUD will release the PHA tools Form HUD-52723 and Form HUD-52722 by Friday, Jan. 12, or earlier. PHAs must submit these forms to their Field Offices no later than February 2. HUD will publish preliminary eligibility for 2018 based upon HUD-52723 by March 5, and and PHAs will be required to contact HUD with any issues regarding their preliminary eligibility by March 12.

On December 27, HUD issued a notice announcing allocations, common application, waivers, and alternative requirements for Community Development Block Grant-Disaster Recovery (CDBG-DR) to the state of Texas. The notice allocates $57,800,000 of CDBG-DR funds to the State of Texas in response to Hurricane Harvey. Funds must be used only for specific disaster recovery related purposes. The notice is applicable starting January 2, 2018.

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On Friday, December 22, HUD will withdraw five proposed rules in an effort to reduce regulatory and financial burdens. As HUD is only withdrawing proposed rules that have yet to go into effect, PHA operations will not be impacted. PHAs are not required to follow proposed rules. However, NAHRO had previously expressed concerns with some of these proposed rules and is glad to see that HUD will not be moving forward with flawed final rules. HUD’s action is consistent with Executive Order 13771 that requires at least two prior regulations be identified for removal for every new regulation issued and Executive Order 13777 that established a Regulatory Task Force aimed at identifying agency regulations that should be repealed, replaced, or modified.

The five proposed rules to be withdrawn include:

• Demolition or Disposition of Public Housing Projects and Conversion of Public
  Housing to Tenant-Based Assistance (79 FR 62249, October 16, 2014);
• Streamlining Requirements Applicable to Formation of Consortia of Public Housing
  Agencies (79 FR 40019, July 11, 2014);
• Public Housing: Physical Needs Assessments (76 FR 43219, July 20, 2011);
• Floodplain Management Protection of Wetlands; Minimum Property Standards for
  Flood Hazard Exposure; Building to the Federal Flood Risk Management Standard (81 FR 74967, October 28, 2016);
• Homeless Emergency Assistance and Rapid Transition to Housing Rural Housing
  Stability Program (78 FR 18725, March 27, 2013).

NAHRO has long advocated for reduced regulatory burden from HUD, and had serious concerns with  HUD’s demolition/disposition proposed rule, streamlined consortia proposed rule, floodplain management proposed rule, and HUD’s proposed changes to Physical Needs Assessments (PNAs) that would have required MTW agency PHAs, and PHAs with 250 units or less to perform PNAs.

Again, withdrawing these proposed rules will not impact PHA operations as PHAs are not required to comply with proposed rules.

NAHRO’s comment letters on the withdrawn proposed rules can be found here (members only).

NAHRO’s comment letter on reducing regulatory burden can be found here (members only). 

On November 29, HUD’s Office of Public and Indian Housing (PIH) issued PIH-2017-24 (HA) titled, “Guidance on Third-Party Agreements Encumbering Public Housing Property.”  The Notice discusses the procedures and requirements for PHAs that enter into a third-party agreement that would encumber the PHA’s use or interest in public housing property. Third-party agreements may take various forms including but not limited to leases, licenses, leaseholds, rights-of-ways, easements, operating agreements, contracts, liens, assignments, and asset transfers.

The Notice discusses the types of third party agreements that are permissible. These include agreements for normal uses associated with the operation of public housing and agreements unrelated to normal uses associated with the operating of public housing. PHAs are responsible in determining whether a third-party agreement requires HUD approval. This is determined via a disposition analysis and an annual contributions contract (ACC) analysis. PHAs may need approval from either HUD’s Special Application Center (SAC) or their Field Office before entering into a third-party agreement, however this is not always the case. The PHA is responsible for determining whether the SAC or the Field Office is responsible for approval.

Lastly, the notice contains requirements for third-party agreements, and contains a suggested HUD rider to third-party agreements.

On November 22, HUD notified PHAs that they will not be deploying Operating Subsidy tools on November 27, as previously scheduled due to technical issues. HUD anticipates deploying the tools in early January and will post a revised schedule shortly.

On November 15, HUD’s Office of Public and Indian Housing (PIH) released Notice PIH-2017-23 (HA), entitled “Updates to Flat Rent Requirements.” This Notice supersedes and replaces the guidance provided in Notice PIH 2015-13 and clarifies HUD’s interpretation of the statutory amendment related to flat rents.This notice also serves as supplemental guidance to the interim rule published on September 8, 2015 with an effective date of October 8, 2015.

The FY 2014 Appropriations Act requires PHAs to establish flat rents at no less than 80 percent of the applicable Fair Market Rent (FMR). However, if a new flat rent amount for a unit increased a family’s existing rental payment by more than 35 percent, then the new flat rent amount was required to be phased in as necessary to ensure that the family’s existing rental payment did not increase by more than 35 percent annually.

The FY 2015 Appropriations Act further amended the public housing rent requirements for flat rents. Specifically, the statute was amended to require that flat rents must be set at no less than the lower of 80 percent of the fair market rent or at the discretion of the Secretary if the Secretary determines a different amount more accurately reflects local market conditions. This can be done by a PHA applying for an exception waiver.  

Notice PIH-2017-23 provides guidance and clarification on using smaller geographic area FMRs to determine flat rents, applying for exception flat rents, incorporating utility expenses into flat rents, complying with flat rent policies on an annual basis, and conducting annual rent options.

On November 8, HUD released Notice PIH-2017-22 titled “Guidance on Eligibility for Asset-Repositioning Fee (ARF) when Public Housing Units Are Approved for Demolition, Disposition, or Transitioned to Homeownership.” The Notice applies to all PHAs administering Public Housing, including MTW PHAs.

PHAs that transition projects or entire buildings within a project out of the public inventory may be eligible for ARF, which is an add-on to Operating Subsidy eligibility. ARF supplements costs associated with administration of demolition and disposition, tenant relocation, and minimum protection and services associated with such efforts. It is not intended for individual units within a multi-unit building.

The guidance discusses which units would be considered eligible for ARF, the timeline for homeownership and non-homeownership ARF, how to identify unit months for units eligible to receive ARF, how to calculate ARF amounts, how to determine the ARF funding period versus the Operating Subsidy funding year, how to use ARF when a PHA demolishes and/or disposes of different buildings in one project in multiple phases, and how to adjust the rolling base if some units in a project are ARF eligible and others are not.

HUD has posted a preliminary schedule to submit the 2018 Public Housing Operating Subsidy. HUD 52723 and HUD 52722 Forms will be made available to PHAs on November, 27. PHAs are required to provide these forms to their Field Offices by December 18, 2017. The publication of preliminary eligibility based upon HUD-52723 Operating Subsidy Submissions will be on January 29, 2018. PHAs should contact their Field Office by February 5, 2018 with any issues regarding preliminary eligibility for all projects.

On September 28, HUD’s Operating Fund provided PHA projects a set of obligations for a small amount of funds. The funds include the 2016 holdback reserve – $5,000,000 that was set aside to address HUD corrections – and 2016 deobligations (recaptured funds) that are also available for distribution. PHAs should draw down the funds immediately, and the funds may be used for for 2016/2017 needs and/or reserves. The funds are currently available in eLOCCS.