FMRs

HCV Utilization Webinar

~ Tushar Gurjal ~ Leave a comment

HUD will host a webinar on Jan. 12, 2022 at 1:30 pm ET titled “HCV Utilization Webinar – Payment Standard Waiver and Two-Year Tool Overview.” The webinar will discuss best practices to maximize voucher utilization. The webinar will also discuss the new Fair Market Rent (FMR) waiver that will allow many PHAs to increase their payment standard to 120% of the FMR. (See NAHRO’s discussion of PIH 2021-34.) Finally, the webinar will discuss the Two-Year Tool and provide examples of how the tool can help program administrators manage their programs.

Registration for the webinar can be found here.

HUD Publishes Expedited Waiver Notice for Public Housing and Voucher Programs

~ Tushar Gurjal ~ Leave a comment

On Dec. 9, HUD published a notice titled “Expedited Regulatory Waivers for the Public Housing and Housing Choice Voucher (including Mainstream and Mod Rehab) Programs” (Notice PIH 2021-34). This notice provides information on flexibilities that HUD will continue to provide for the public housing and Housing Choice Voucher (HCV) programs, even though most regulatory and statutory waivers related to the COVID-19 pandemic will expire at the end of the year. The COVID-19 waivers for the public housing and voucher programs were published because of authority given to HUD through the passage of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Additional information on the expiration of these waivers can be found in HUD’s guidance for winding down CARES Act waivers; PIH 2021-14 (providing revised waivers for public housing and the HCV program); PIH 2020-20 (providing waivers for the Mod. Rehab. program); and PIH 2020-22 (providing waivers for Mainstream vouchers).

This notice divides the additional potential flexibilities into three categories. First, there are flexibilities that will continue with no waivers needed. Second, there are regulatory waivers that PHAs may request and which HUD will review through a streamlined process. Third, there are additional regulatory waivers which PHAs may request, but which HUD will review through its normal waiver review process. None of the statutory waivers provided through CARES Act authority will be extended. In general, HUD lacks the authority to waive statutory program requirements, so PHAs should not request waivers for statutory requirements.

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HUD Publishes FY 2021 FMRs

~ Tushar Gurjal ~ Leave a comment

Over the weekend, HUD published a list of fiscal year (FY) 2021 Fair Market Rents (FMRs). The FMR is the basis for defining the payment standard amount in the Housing Choice Voucher (HCV) program. The Department also uses FMRs for certain other HUD programs. A FMR is “the amount that would be needed to pay the gross rent (shelter rent plus utilities) of privately owned, decent, and safe rental housing of a modest (non-luxury) nature with suitable amenities.” It set at a level to estimate the 40th percentile gross rent (i.e., it is set at a level to allow a program participant to be able to rent a unit from 40 percent of the appropriate available stock in the area). Comments on FMR methodology or requests for FMR reevaluation must be submitted by Sept. 30, 2020. New FY 2021 FMRs will become effective on October 1, 2020.

The Department uses a several step process to calculate the FMRs. First, HUD begins with the U.S. Census Bureau’s 5-year American Community Survey (ACS) data collected between 2014 and 2018. The Department then updates this base year rent data with a 1-year recent mover factor based on the 1-year 2018 recent mover gross rent. The data is only updated if the recent mover factor increases the base year rent data. For both the base year data and the recent mover trend factor, alternative methods may be used for areas that do not have statistically reliable data. The Department then updates this data by using the annual change in gross rents measured through the Consumer Price Index (CPI) from 2018 to 2019. Finally, the Department trends forward the data using one of three models to bring the data from a 2019 estimate to a 2021 forecast. The model used to trend forward the data is based on which model “generates the lowest Root Mean Square Error (RMSE) statistic.”

Once the data has been forecast to FY 2021, the Department takes additional steps. First, the Department adjusts the data, which is typically for two-bedroom units, to create FMRs for other unit sizes. Second, the Department limits the amount of decrease an FMR may have from one year to the next. The current year’s FMR may be no less than ninety percent of the prior year’s FMR. Additionally, the FMRs are subject to the lower of a state or national floor for the FMR.

Small Area FMRs have a distinct methodology employed when being calculated, including their own alternative methods if the data for an area does not meet a statistical check.

Public housing agencies may request that HUD recalculate their FMRs for specific areas. Agencies may fund local surveys of rent and may use their administrative fees to fund these surveys. For a recalculation, a PHA must supply HUD with data more recent than the 2018 ACS data used in calculating FY 2021 FMRs. In early October, HUD will post a list of areas requesting reevaluations. Data for the reevaluations must be submitted by Friday, January 8th. The Department will then post revised FMRs. Data submitted after January 8, 2021 will be incorporated into FY 2022 FMRs.

The full notice can be found here.

The FY 2021 FMRs can be found here.

Summary of HCV Landlord Listening Sessions Published

~ Tushar Gurjal ~ Leave a comment

[1/29/2020 – Links to the summary have been updated to reference an updated version of the summary. The original summary has been removed from HUD’s website.]

The Department of Housing and Urban Development has published a summary of the Housing Choice Voucher (HCV) program landlord listening sessions it conducted in late 2018. The summary lists the qualities of the HCV program which both attract and drive off landlords from participating in the program. A brief outline of them is presented below.

  • Qualities of the HCV program that attract landlords:
    • National;
      • Helping people who need housing;
      • Receiving a stable, reliable source of income from HUD;
    • Regional;
      • Required by law in some jurisdictions to accept vouchers; and
      • Existence of damage mitigation programs which help landlords repair tenant-caused damages;
  • Qualities of the HCV program that drive off landlords:
    • National;
      • No single point of contact for landlords and other communication deficiencies;
      • Inspections;
        • Delays in the inspection process;
        • Lack of consistency between inspections;
        • Not being informed of changed appointment times by inspectors;
        • Too few inspectors;
        • Not being informed of cancelled appointments in a timely manner;
      • Tenant damages;
        • Lacking a mechanism of collecting on tenant-caused damages;
        • Lacking a way to remove damage-causing tenants;
        • Requirements to repair a unit;
        • Unknown tenant-caused damages cause units to fail inspections;
      • Application and Move-in;
        • Concerns about
          • approved rent amounts;
          • length of time for application approval; and
          • inspections;
      • Voucher and Approved Rent amount;
        • Lack of clarity about required amenities and conditions of units;
        • Fair Market Rents (FMRs) not keeping pace with the local market;
      • Administrative delays;
        • Lack of being able to submit paperwork electronically;
        • Lack of staff that could approve cases during holidays and vacation times;
    • Regional;
      • Confusion over widely varying rent amounts in areas that use Small Area FMRs;
      • Annoyance at the different paperwork and rules for each PHA, in areas where there are multiple PHAs with overlapping jurisdictions;
      • Cumbersome process to access damage mitigation funds in those areas which use them; and
      • The requirement to treat voucher holders differently by requiring a one-year lease initially, when the norm in the market is month-to-month leases.

While the causes of landlord dissatisfaction are multi-faceted and may vary by jurisdiction, NAHRO believes that fully funding the administrative fee account will help PHAs address many of these issues.

The above is a brief outline of the report and excludes details for added brevity. The full summary can be found here.

FY 2020 FMRs Published

~ Tushar Gurjal ~ Leave a comment

Tomorrow, HUD will publish the Fair Market Rents (FMRs) for Fiscal Year (FY) 2020 on its website. A pre-publication copy of the notice was published today in the Federal Register–titled “Fair Market Rents for the Housing Choice Voucher Program, Moderate Rehabilitation Single Room Occupancy Program, and Other Programs Fiscal Year 2020.” These FMRs will become effective on October 1, 2019. Comments for these FMRs (or requests for reevaluation for specific FMRs) are due within 30 days of their official publication.

Click below to read more.

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Complimentary Webinar!! Fair Market Rent Appeals – August 27, 2pm EDT

~ Georgi Banna ~ Leave a comment

On Tuesday, August 27, at 2pm eastern time, NAHRO will be hosting a complimentary webinar in preparation for the release of the 2020 Fair Market Rents and the appeal process. Below is information on the session and the registration link. This session is for agencies of all sizes from the smallest to the largest and will discuss HUD’s process, the options and first-hand PHA experiences.

Using Research Surveys to Raise Your FMR

Do the Fair Market Rents (FMRs) in your area match on-the-ground rental prices that your voucher applicants encounter? If they do not, then this webinar will show you how to increase your FMRs. You will learn about two methods to conduct research surveys. This research survey data can be submitted to HUD to show that on-the-ground rental prices exceed the FMR, allowing HUD to increase the FMR to match the actual rental prices in your area. Bring your questions and comments and prepare your PHA for the 2020 FMRs to be released in a few weeks!

Please register for Using Research Surveys to Raise Your FMR on Aug 27, 2019 2:00 PM EDT at:

https://attendee.gotowebinar.com/register/773057130839951117?source=blog

After registering, you will receive a confirmation email containing information about joining the webinar.