HUD Announces Changes to UPCS Protocol

HUD has announced two changes to the UPCS inspection protocol that will impact agencies with public housing units and Project-Based Rental Assistance (PBRA) properties. HUD has been performing a “wholesale reevaluation” of the REAC since 2017. HUD’s announcement included two significant changes to the UPCS inspection process.

The first change is a switch to a 14-day notification period for PHAs and inspectors to schedule and perform an inspection on public housing and PBRA units. The second is a new inspection model that will be informed by listening sessions HUD will host across the country. The new model will begin as a pilot and is aimed to ensure REAC scores more accurately reflect the quality and safety of public housing and PBRA units.  

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Revised ACC Comments Due One Month From Today

On December 27, HUD published a revised Annual Contributions Contract (ACC) in the Federal Register via a Notice of Proposed Information Collection (see NAHRO’s Monitor article – members only). This provided 60-days for the public to comment on the revised ACC. Despite what the revised document states, NAHRO continues to believe that the ACC is a bilateral contract and not a unilateral grant agreement. NAHRO believes HUD should negotiate directly with PHAs to bilaterally enact any changes to the ACC, as opposed to publishing a Notice of Proposed Information. Comments on the 60-Day Notice of Proposed Information Collection are due one month from today on February 25.
In the spring of last year, HUD revised the ACC, which contained terms that PHAs automatically agreed to when they drew down FY 2018 Capital Fund Program (CFP) grants. The new ACC did not require a signature from an Executive Director or approval from a PHA’s Board, however, HUD viewed this ACC as enforceable once the PHA drew down its capital funds. NAHRO, along with our industry partners, had significant concerns regarding the procedural and substantive issues of that ACC. Specifically, the industry took issue with HUD’s lack of communication to PHAs and the industry regarding changes to the ACC and several substantive issues contained within the revised ACC. As a result, HUD suspended the new ACC in October, reverting any agency that executed the new contract back to their prior ACC.
HUD’s latest revised version of the ACC is substantively similar to the version published last Spring with some slight modifications. The December version of the ACC removed language capping PHA executive salaries that is included in recent Appropriations bills. The December revision also includes some slight modifications for clarity.
Unfortunately, NAHRO continues to have the same concerns regarding the process and substance included within the December revision of the ACC. Aside from process concerns that demonstrate HUD does not view the ACC as a bilateral contract between two parties, substantive issues include:
  • Addition of the term “program receipts”;
  • A requirement for PHAs to follow HUD-issued notices and HUD-required forms or agreements;
  • A Prohibition on PHAs from releasing any information contained in HUD’s system of records (SORN) without prior HUD approval – HUD has clarified to NAHRO that PHA’s would be able to release any information stored in PHA systems, however, this version of the ACC does not make that clear;
  • Other mixed-finance issues; and
  • Certain MTW specific concerns.
NAHRO will continue to work with our industry partners and continue to express our member’s concerns to Congress and HUD. Comments on the 60-Day Notice of Proposed Information Collection are due February 25.
The HUD’s Notice of Proposed Information Collection can be found here.

HUD Announces ROSS-SC Awards

On December 21, HUD published a press release announcing the awarding of $29 million in grants to PHAs and non-profit organizations across the nation to hire or retain service coordinators to help residents find jobs and educational opportunities through the Resident Opportunities and Self Sufficiency Service Coordinators (ROSS-SC) program. According to HUD, the ROSS-SC program “encourages local, innovative strategies that link public housing assistance with public and private resources to enable participating families to increase earned income; reduce or eliminate the need for welfare assistance; and make progress toward achieving economic independence and housing self-sufficiency.”

HUD Secretary Ben Carson noted that “[p]roviding families who live in public housing the opportunity to invest in themselves is a win-win as it helps them to gain economic and housing independence … [t]oday, we’re investing in our residents, offering them the tools they need to build a brighter future for themselves and their children.”

For a list of grant funding by state, see here.

HUD Posts Information Collection on Changes to Admission and Occupancy Requirements

On December 20, HUD posted in the Public Inspection of the Federal Register a 30-Day Notice of Proposed Information Collection on changes to Admission and Occupancy Requirements for public housing. According to the Information Collection, HUD is making changes to the Admission and Occupancy requirements that “defin[e] an ‘over income family’ as one having an annual income 120 percent above the median income for the area for two consecutive years and includes new mandatory annual reporting requirements on the number of over-income families residing in Public Housing and the total number of families on the Public Housing waiting lists at the end of each reporting year.”

HUD is making these changes in light of the Housing Opportunity Through Modernization Act of 2016 (HOTMA) which included language limiting tenancy of over-income residents in public housing. HUD will use its calculation of very low-income (VLI) to determine income limits. VLIs are preliminarily calculated as 50 percent of the estimated area median family income. VLI limits include several adjustments to align the income limits with program requirements including: high housing cost adjustments, low housing cost adjustments, state and non-metro median family income adjustments, and ceiling and floors for changes. HUD will use the VLI as the basis for the 120 percent income limit by multiplying the VLI limit by a factor of 2.4. Areas without a VLI adjustment would result in an income limit of 120 percent of AMI. Areas with an adjustment would be higher or lower than 120 percent AMI, depending upon the adjustments made.

If a family meets this threshold, public housing authorities (PHAs) have the option of either charging the higher of the fair market rent for the unit or the monthly subsidy (operating and capital fund), or terminating the tenancy within 6 months.

Comments on the proposed notice of information collection are due 30 days after publication in the Federal Register.

CY 2019 Operating Fund Submission Schedule Updated

HUD has released version 1.2 of its PHA Operating Fund Submission Schedule for CY 2019. HUD will make HUD Forms HUD 52723 and HUD 52722 available to PHAs on February 11, 2019. PHAs will be required to submit those forms to their Field Office by March 4. HUD plans to publish preliminary eligibility based on HUD-52723 operating subsidy submissions on April 1. PHAs should contact their Field Office with an issues regarding preliminary eligibility for all projects by April 8.

PHAs are funded based on an estimate in January, February, March, and April.

HUD Sends Public Housing Repositioning Letter to EDs

On November 13, HUD sent a letter to Executive Directors of Public Housing Agencies notifying them of their options related to the repositioning of their public housing properties. In the letter, HUD discusses the Rental Assistance Demonstration (RAD) Program, new flexibilities for Section 18 demo/dispo, and forthcoming guidance on voluntary conversion and the retention of assets after a Declaration of Trust (DoT) release. HUD notes that the Department is currently encouraging agencies to reposition their public housing properties to help address the significant public housing capital backlog. HUD is not requiring agencies to reposition their public housing properties at this time.

HUD notes that Field Offices plan to reach out to PHAs in the coming months to help agencies “explore repositioning possibilities in [PHA] inventories.” HUD states its goal in contacting agencies is to help ensure PHAs understand their options. HUD plans to make all repositioning resources available on the PIH One-Stop Tool for PHAs (POST).

HUD’s letter can be found here.

HUD Releases Two PIH Notices

Recently, HUD released two new PIH Notices. The first is titled “Housing Opportunity Through Modernization Act of 2016 (HOTMA) – Implementation of Minimum Heating Standards in Public Housing Properties” and the second is titled “Partnering with Utility Companies on Energy Performance Contracts.

The first notice provides implementation guidance related to the minimum heating requirements within public housing dwelling units as required by Section 111 of the Housing Opportunity Through Modernization Act of 2016 (HOTMA). For a PHA where state or local minimum heating standards do not exist, the PHA shall use the following minimum heating requirements for public housing dwelling units in order to comply with Section 111 of HOTMA:

  • Minimum Temperature:
    • If PHA-controlled, the minimum temperature in each unit must be at least 68
      degrees Fahrenheit.
    • If tenant-controlled, then the heating equipment must have the capability of
      heating to at least 68 degrees Fahrenheit.
  • Minimum Temperature Capability:
    • PHAs are allowed flexibility in maintenance of the indoor temperature when
      the outdoor temperature approaches the design day temperature.2 At no point
      should indoor temperatures in occupied space drop below 55 degrees
      Fahrenheit. This flexibility applies when at least one of the below criteria are
      met:

      • The outside temperature reaches or drops below the design day
        temperature, or
      • The outside temperature is within five degrees Fahrenheit of the design
        day temperature for more than two continuous days.
  • Measurement:
    • Temperature measurements must be taken three feet above the floor and two
      feet from an exterior wall in a habitable room.

The second notice, “Partnering with Utility Companies on Energy Performance Contracts,” provides supplemental guidance for Notice PIH 2011-36 and any update which concerns implementing Energy Performance Contracts (EPCs) at PHAs. The notice also introduces a new initiative called the EPC Utility Partnership Program (UPP). The purpose of EPC-UPP is to encourage more PHAs, especially small- and medium-sized PHAs to consider the “potential benefits of implementing an EPC in partnership with utility companies.” This Notice also includes a new simplified approval and verification process for low-risk EPC projects.

Marijuana Use in Public Housing and the Housing Choice Voucher Program

On November 6, voters in Michigan legalized the use of recreational marijuana and voters in Utah and Missouri legalized the use of medical marijuana. Although these states, among numerous others, have voted to legalize the use of marijuana to some degree, the Controlled Substance Act (CSA) continues to list marijuana as a Schedule 1 drug that is banned at the federal level. This means that the federal government considers marijuana a “substance with a very high potential for abuse and no accepted medical use in the United States.”

Currently, HUD has not released any guidance specifically related to the use of recreational marijuana in public housing or Section 8 properties. That said, the Quality Housing and Work Responsibility Act (QHWRA) of 1998 requires PHAs to prohibit admission to the Public Housing and Housing Choice Voucher programs based on the illegal use of federally controlled substances. This includes both the medicinal and recreational use of marijuana. QHWRA also requires PHAs to have established occupancy standards and lease provisions that allow the PHA to terminate assistance if a resident is using a controlled substance as defined by the CSA.

A HUD memo from 2011 notes that although new admissions of medical marijuana users are prohibited into the Public Housing and Section 8 program, PHAs have the “discretion to determine, on a case-by-case basis, the appropriateness of program termination of existing residents for the use of medical marijuana.”

Furthermore, although the Instituting Smoke-Free Public Housing Final Rule makes no mention of marijuana (it only refers to lit tobacco products), the rule does give PHAs the flexibility to prohibit other lit products in their smoke-free policies. As such, PHAs could include marijuana in their smoke-free policies if they choose, in order to provide additional clarity to residents.

Although there is still no specific HUD guidance relating to the use of legal recreational marijuana at the state level, marijuana is still considered an illegal substance at the federal level. PHAs should continue following their established occupancy standards and lease provisions as written until additional HUD guidance is released.

HUD Releases MTW Expansion Operations Notice

On Friday, October 5th, HUD will release the Operations Notice for the Expansion of the Moving to Work (MTW) Demonstration program. The notice establishes the requirements for the implementation and continued operations of the MTW demonstration program pursuant to the 2016 MTW Expansion Statute. Comments are due 45 days from publication of the Operations Notice in the Federal Register.

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HUD Announces Disaster Recovery Waivers

HUD has released a notice in the Federal Register announcing an expedited review process for relief from HUD regulatory and/or administrative requirements for PHAs that are located in counties that have received Presidentially-declared Major Distaster Declarations (MDD). PHAs located in areas that received MDDs in CY 2018 may request waivers of HUD requirements and receive expedited review of such requests.

The Notice includes descriptions of the flexibilities that are currently available to MDD PHAs under statutes and/or regulation, certain HUD requirements that, if waived, may facilitate an MDD PHA’s ability to participate in relief and recovery efforts, and environmental review waivers.

NAHRO is keeping our members and all individuals impacted by Hurricane Florence in our thoughts, and are wishing for a safe and rapid recovery. To everyone impacted by the hurricane, please stay safe!