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HUD issues notice on administrative fee reserves

Posted by NMA on Oct 8, 2015 2:58:19 PM

This week HUD’s Office of Public and Indian Housing (PIH) issued Notice PIH 2015-17 to provide guidance to PHAs on the use and reporting of administrative fee reserves, or unrestricted net position (UNP) accounts. The seven-page notice reissues with minor revisions Notice PIH 2010-7, providing updated guidance on the reporting of admin fee reserves and use of reserves when faced with insufficient funding. The new notice responds to recommendations by the Office of Inspector General (OIG) to implement controls and requires reconciliations of UNP. Below is a summary of the major differences:

  • In terms of background, the new notice references the requirements to maintaining UNP, rather than UNA accounts. On an annual basis, PHAs credit to the UNP the total of: (1) The difference between program admin fees and program admin expenses for the fiscal year; plus (2) The net of revenue and expenses related to the administration of unabsorbed portability units; plus (3) Interest and other income earned on the investment of admin fee reserves; plus (4) The portion of fraud recoveries actually collected that flows to the admin fee reserves; plus (5) Any other miscellaneous admin revenues or equity transfers to the HCV admin fee reserve; minus (6) Any expenditures from the reserve account to cover excess HAP costs not covered by HAP funding and HAP reserves or other allowed uses of admin reserves.
  • Regarding use of administrative fees, the notice clarifies that if a surplus of administrative fees remains at the end of the PHA’s fiscal year (FY), the amount by which the program admin fees paid by HUD for the FY exceeded the PHA’s HCV administrative expenses for the FY is added to the admin fee reserves.
  • No substantive changes were made to the sections regarding pre-2004 and post-2003 admin fee reserves.
  • In terms of the general depository agreement, the new notice clarifies that form HUD-51999 must be executed between the PHA and the depository, and must include all deposit account numbers in which HCV program funds are held.
  • For reporting requirements, the new notice clarifies that PHAs must report post-2003 admin fee reserves separately from pre-2004 reserves on the FDS income statement in the details of the line 11170 memo account, and that specific FDS detail lines for pre-2004 and post-2003 admin fee reserves have been added to the FASS-PH system for the HCV program. These new line items must be completed and can be found in the detail link of FDS line 11170 on the income statement tab of the HCV program. As currently programmed, these lines must also include amounts associated with FDS line 508.4, Net Investments in Capital Assets. In a future FASS-PH release, FDS line 11170 will distinguish admin fee reserves and net investment in capital assets that will reconcile to FDS line 512.4, UNP.
  • The new notice also states that UNP must be reported in VMS on a monthly basis in the field currently titled Unrestricted Net Assets (UNA) as of the Last Day of the Month, which will be changed in a coming VMS release to reflect the new language. Further, the new notice lists exactly what the UNP reported in the VMS should consist of, in addition to clarifying that excess admin fee disbursements from HUD are not added into the UNP on a monthly basis because these amounts to not become “unrestricted” until the end of the FY. During the FY, admin fee disbursements may only be used to cover current year admin expenses.
  • The notice states that if a PHA has to dip into the UNP to cover excess admin expenses, it still may not increase the UNP during the FY by adding in excess current year admin fees in later months, even if the UNP balance remains below the previous FYE balance. Overall excess admin expenses may decrease the UNP from month to month during the FY, but excess admin fee disbursements from HUD should not generally increase the UNP from month to month during the FY. Only fraud recovery, port-in, interest, or other non-HUD revenue may increase the UNP from month to month during the FY.
  • In terms of use of HAP funds, the new notice states that restricted net position (RNP) is reported in VMS in the field currently titled Net Restricted Assets as of the Last Day of the Month (likewise to be updated), and that RNP is the amount reported on the FDS balance sheet at line 511.4. The notice also lists what RNP should consist of as reported in VMS, and notes that as of January 1, 2012, interest earned on HAP and HAP investments was no longer a part of the RNP. As of January 1, 2014, the PHA may retain up to $500 in interest earned on HAP and HAP investments, but those funds are to be recorded and reported as administrative revenue flowing to the UNP.

No substantive changes were made regarding sanctions, however the new notice does state that the Quality Assurance Division (QAD) will continue to conduct on-site and remote reviews of PHA financial reporting and recording, and that incorrect reporting and recording will result in review concerns or findings for which corrective action plans must be developed by the PHA.

NMA offers two HCV finance classes: HCV Financial Management, with upcoming dates in Dallas and Cleveland, and HCV Financial Accounting and Reporting, with upcoming dates in Las Vegas, Louisville, and Seattle. Not sure which one to take? Email sales@nanmckay.com for further guidance.

Topics: FASS-PH, financial management, PIH notices, VMS

Join NMA for our national housing conference in San Diego

Posted by NMA on Mar 12, 2013 10:10:44 AM

Registration for the first-ever NMA Housing Conference is now open, and session information has been announced.

2013 NMA Housing Conference
and GoSection8 User Conference

September 9–10 in San Diego, CA

Sign up now and receive 20% off Blended Occupancy Management and HCV Program Management!

Choose one of these new certification classes to attend directly following the conference, and make it a complete week of learning in beautiful San Diego on the bay.

Visit our website to register

With four tracks of concurrent sessions, you'll enjoy the opportunity to explore two very full days of expert panels, round-table discussions, free consulting, and networking with key players in the industry. You'll also receive a certificate of achievement for attending an entire track (choose from executive, regulatory, financial, and GoSection8).

Keynote Speaker

Leading at a Higher Level: Creating High-Performing Organizations
Presenter, Ann Phillips of the Ken Blanchard Companies

Executive Leadership for Performance Excellence

Ensuring the Best Performance for the Money: Quality Assurance from the Executive Level
Presenters, John McKay, Dorian Jenkins, Michael Petragallo, Andrew Denicola

This session will focus on how successful housing executives ensure excellent staff performance and the overall cost efficiency of their agency by applying performance management metrics and a proactive quality assurance approach. We will discuss methods to ensure staff performance, covering all personnel from line staff to finance and inspection, as well as provide information about cost-saving measures to take back to your agency.

Managing a Public Agency with a Corporate Sector Approach
Presenter, Cydney Jones

Applying private sector techniques to your agency doesn't have to mean losing focus of its social mission. This informative session will provide PHA leaders with tools and insight to develop an organizational culture of performance excellence, accountability, fiscal responsibility, and organizational sustainability. The session will provide tips, tools, and guidance used in the corporate sector to develop and maintain high performance and fiscal prudence within the public sector environment.

How to Improve the Quality and Value of Your Services at a Reduced Cost
Presenter, Mark Frater, President, LeanFirm

Attend this session and learn how to employ a collaborative methodology at your housing authority by adopting lean principles. Discussion topics will include developing a highly effective path to maximizing the talents and contributions of your agency, facilitating motivation, productivity, customer satisfaction, and fiscal control. In today's era of budget cuts, it's more important than ever to improve the timeliness and quality of services throughout your housing agency by eliminating waste and inefficiency.

Don't Waste Strategy Time on Goal Setting!
Presenter, Eric Kaufmann, President, Sagatica LLC

Most strategy sessions are merely operational — a missed leadership opportunity. Eric Kaufmann guides leadership teams across the country and coaches corporate CEOs. He will present the way to prepare a strategic action plan that becomes a useful resource to accomplish your agency’s goals within limited funding. You will discover the six deadly mistakes of strategy planning. Ask the right questions, set the right measurements, and get to work!

PHA Resiliency in the Post-Sequestration World
Presenter, Kevin Sheriff, ERS Senior Manager, Deloitte & Touche LLP

This session will explore the short- and long-term future of PHAs' roles in their communities and how they can survive and thrive in the face of dwindling federal resources and ongoing chatter about consolidation. We will discuss strategies that PHAs can explore beyond the traditional methods (e.g. mixed finance, alternative revenue-generating activities, energy performance contracts) to recast their organizations for sustainable, long-term success.

Regulatory Knowledge for Smart Management

Why Your Agency Should Be Taking a Second Look at RAD
Presenter, Carrol Vaughan

The RAD demonstration program is a unique opportunity for housing authorities to convert their at-risk public housing to long-term Section 8 rental assistance contracts. In this session, we’ll cover the latest information on the program and discuss why your housing authority should take a serious look at whether RAD would work for your agency. We’ll also hear from staff at a large housing authority on why their agency is considering submitting an application, and review the thought process involved in making the decision to apply.

Legislative Update
Presenter, Nan McKay and Terry Provance

What's the latest news in the industry? In this session we'll review the most important notices released in 2013, any breaking news that you need to be aware of, and what we see coming down the pipe for 2014.

Fair Housing/Civil Rights Reviews: Are You Prepared?
Presenter, Annie Stevenson

Using HUD’s civil rights review checklist, we’ll discuss fair housing requirements for the public housing and HCV programs. Topics will include limited English proficiency (LEP), reasonable accommodations, alternative communication methods, and more. Don’t miss this opportunity to prepare for civil rights monitoring.

EIV, PIC, VMS: Are These Systems Costing Your Agency Money?
Presenters, Dorian Jenkins and Raymond Buhr

In this session, NMA staff will go over HUD's reporting requirements and provide tips to help your agency properly utilize Enterprise Income Verification (EIV), maximize your PIH Information Center (PIC) reporting rate, simplify the Voucher Management System (VMS), and ensure you aren't losing precious housing dollars.

Sustainability: Cost-Effective Renovation
Presenter, Jay Ortenzo

Are you tired of hearing phrases like, “We have to do more with less”? Truth is, we have to plan and be smart about the way we use our resources. While there’s always a cost associated with any renovation we do, labor, materials, overhead, profit, bad design, poor product choice, and installation mistakes cost your agency more than necessary. This session will focus on how to ensure you're getting the best renovation work for the money.

Financial Strategy for Maximizing Resources

The Impact of the Treasury's Cash Management Requirements on the HCV Program
Presenter, Ray Adair

This session will explain the impact that the implementation of the Treasury's cash management requirements will have on HCV housing assistance payment (HAP) revenue recognition, the formation of the HCV program reserve, net restricted assets (NRA) reporting, and interest earned on invested NRA balances.

Reporting Public Housing Operating Fund Activity on the FDS
Presenter, Ron Urlaub

This session will cover how new public housing and mixed-finance projects are created in the Financial Data Schedule (FDS), general project-level reporting for both conventional public housing projects and mixed-finance projects, and common public housing operating fund reporting issues on the FDS.

Using HUD's Two-Year Forecasting Tool for HAP Expense Planning
Presenter, Ray Adair

HUD has developed an Excel forecasting tool (posted with a user guide on the HCV home page) to assist PHAs in the financial management of the HCV program. The focus of this session will be on reviewing the funding available to support HAP (annual budget authority, net restricted assets, program reserves, and unrestricted net assets) and how to make the best use of the two-year forecasting tool. We will review the major sections of the tool, as well as what data is needed to use the tool and where to find it. In addition, you will learn how to use the tool to run "what if" scenarios, and how to use the tool's dashboard to determine whether leasing is within available funding.

FASS-PH System Updates
Presenter, Ray Adair

This session will explain the recent and planned REAC Financial Assessment System for public housing agencies (FASS-PH) system updates that impact financial reporting on the Financial Data Schedule (FDS) for both the public housing and HCV programs.

Reconciling VMS Reporting to the FDS
Presenter, Ron Urlaub

This session will review which fields on the Voucher Management System (VMS) are expected to tie or come close to the values reported on the Financial Data Schedule (FDS).

The Ins and Outs of CFP Reporting and Close-Out
Presenter, Ray Adair

This session will focus on how budget line items (BLI) are used for budgetary control of the Capital Fund Program (CFP), CFP eligible and ineligible expenses, Financial Data Schedule (FDS) reporting of the CFP and the Capital Fund Financing Program at the project level, and CFP close-out.

How Go8's Technology Can Be a Cost-Saving Resource for Your Agency

Introduction to GoSection8
GoSection8 is the largest rental-listing service for the Section 8 housing market. We service families, landlords, and public housing agencies across the United States. Hundreds of thousands of tenants and landlords nationwide benefit from our programs.

Don't Spend Money on Software: We Have the Solution
In an environment of eminent budget cuts, learn how Go8's free listing service can save you time and money.

GoSection8 Software Demonstration
Since our inception in 2004, GoSection8 (Go8) has been an effective resource for housing agencies across the country. Our software streamlines the rent reasonable process, automatically integrating comparable data and generating HUD-compliant rent reasonable reports. Go8 will save your staff valuable time, eliminating the need for mining data or contracting with an outside vendor to purchase comparables.

Best Practices of Different-Size Agencies and Their Savings with Go8 Software
A detailed study of various-sized agencies with different asking rents, approved rents, and annual savings received by implementing the Go8 software. We offer an audit-proven and efficient way to determine rent reasonableness as required by HUD.

The Growth of Technology and Its Impact on Rent Determination
Go8 offers on-demand mobile applications and software integration. Users can perform rent reasonable comparisons on-site, in real time, using their current housing software — no need to log into your Go8 account.

How to Focus on Landlord Retention and Participation: Why It's Important in This Economy and with Budget Cuts
Landlord outreach and participation are more important than ever. We will discuss current market trends and automated marketing solutions and review Go8's HCV Landlord Participation Index.

Educate Your Staff: How to Do Certifications, Review Annual Savings, and Analyze Reports
Learn how Go8 can help your agency do more with less effort. This training module will ensure you are maximizing the Go8 software and performing rent reasonable determinations correctly.

How to Get the Most out of Your Go8 Software: Review New Features, Upgrades, and Reports
Find out about Go8's newest features and give us your feedback. We have been busy building new improvements to our site to make the user experience even better.

Customized Search Results for Your Families Based on Their Income and Your Jurisdiction
Go8's affordability calculator tailors search results based on a family's income, using payment standards and the landlord's utility schedule.

Deconcentration and Its Impact on Rent Reasonableness
Learn how to improve your agency's SEMAP scores. Go8's listings can be customized to exclude HUD-determined low-income qualified census tracks.

Are You Using Asking Rents or Actual Rents? How It Affects the Open Market
We will demonstrate the surprising difference between asking rent and actual rent.

Go8's Custom Listing Service
We manage and maintain your landlord's listings and also offer a mobile platform to view tenant leads.

Registrations for the NMA Housing Conference and GoSection8 User Conference are now 20% off when you register before July 15, 2013. Sign up online or email sales@nanmckay.com for more information.

Topics: blended occupancy, capital fund, EIV, executive management, fair housing, FASS-PH, IMS/PIC, mixed financing, program management, RAD, rent reasonableness, sequestration, sustainable communities, The Housing Conference, VMS

PIH updates guidance on financial reporting requirements

Posted by NMA on May 11, 2012 2:18:09 PM

HUD’s Office of Public and Indian Housing (PIH) has issued a new notice revising its guidance on the financial reporting requirements for the housing choice voucher program through the Financial Assessment Subsystem for public housing and the Voucher Management System.

Notice PIH 2012-21, issued May 10, 2012, replaces previous guidance on the same subject provided in Notice PIH 2010-45 and remains in effect until amended, superseded, or rescinded.

The new notice makes many key changes to the previous guidance. For example:

  • In section 4, “Financial and Compliance Procedures,” the notice states that PIH will generally reimburse an agency for a special purpose audit if it requires the agency to procure such an audit. However, if the agency has “substantial administrative fee funding” available, PIH may instead direct the agency to use some of this funding to cover the expense of the audit.
  • A new paragraph has been added to the end of section 8, ”FASS Waiver and Extension Requests”:

    HUD will not entertain any waivers of the requirement to file FASS-PH reports; however, PHAs that need extra time to make their submissions may request from HUD an extension of the reporting requirement to submit unaudited financial statements or a waiver of the reporting compliance date requirement found at 24 CFR 5.801(d) for submission of audited statements.

  • Section 10, “HCV-Related Programs,” now includes references to VASH vouchers and provides a link to revised instructions for reporting on these vouchers on the Financial Data Schedule (FDS).
  • Section 10 also includes revised instructions for reporting on Mainstream 5 vouchers: “In the past, some HUD guidance instructed PHAs to report PIH’s Mainstream 5 vouchers under CFDA #14.181, ‘Supportive Housing for Persons with Disabilities.’ This instruction is no longer valid. PHAs should report PIH’s Mainstream 5 vouchers under CFDA #14.879, ‘Mainstream Vouchers.’”
  • A paragraph has been added to section 12, “Clarifications for Reporting Equity in FASS-PH,” to address a new standard on fund balance reporting issued by the Government Accounting Standards Board, GASB #54. The paragraph refers to special FDS reporting instructions for PHAs affected by GASB #54 (Section 8–only agencies that report using modified accrual) and a new GASB #54 supplementary reporting schedule.
  • A new section 13 has been added to address reporting by Moving to Work (MTW) agencies in FASS-PH. This section provides a link to special FDS reporting instructions for MTW agencies.

NMA's HCV Financial Accounting and Reporting provides comprehensive training and guidance with the most current HUD rules and regulations. To stay updated on the latest program information, subscribe to the PIH Alert and Housing Resource Newsletter.

Topics: FASS-PH, MTW, PIH notices, VASH, VMS

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