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Q&A: HOTMA implementation

Posted by NMA on Oct 3, 2016 2:01:08 PM

Q&A: HOTMA implementationQUESTION    We understand that HOTMA was signed into law by the president on July 29, 2016. Inasmuch as there are many substantive administrative changes to the HCV and public housing programs contained in this new law, we are wondering whether PHAs need to await the issuance of a HUD notice before they implement these changes (for example, increase in elderly/disabled deduction, asset limitations, reporting changes of 10 percent or more) or whether PHAs are obligated to immediately adopt these changes even before HUD issues new rules clarifying this new law? We have many recertifications in the pipeline and an answer to this question will obviously impact these pipeline cases.

ANSWER    Most provisions of the Housing Opportunity through Modernization Act of 2016 (HOTMA) will not take effect until HUD has completed the formal rulemaking process. This typically involves issuance of a proposed rule, review of public comments, and publication of a final rule. Changes would likely go into effect 30 days after publication of the final rule, so it may be a year or more before PHAs are permitted to implement the new law.

Five self-implementing provisions of HOTMA were discussed in a letter to executive directors dated September 26. While the remaining HOTMA changes will be implemented through the formal rulemaking process, these five sections became effective immediately upon enactment. Implementation requirements are described below.

Reasonable accommodation payment standards: Section 102(d) of HOTMA provides that PHAs may establish, without HUD approval, a payment standard of up to 120 percent of the fair market rent (FMR) as a reasonable accommodation for a person with a disability. Since this option was made available under the March 8 streamlining final rule, no further action is required.

Fair market rents: Two changes involving FMRs are included in Section 107 of HOTMA. The first change involves HUD’s methods for establishing and publishing FMRs. HUD will no longer publish “proposed” and “final” versions of the FMRs, but PHAs and other interested parties may comment on the FMRs and request HUD to reevaluate them in a jurisdiction before those rents become effective. FMRs for fiscal year 2017 were published on August 26 using the new method.

HOTMA also provides that no PHA in the housing choice voucher (HCV) program is required, as a result of a reduction in the FMR, to reduce the payment standard applied to a family continuing to reside in a unit under a housing assistance payment (HAP) contract at the time the FMR was reduced. PHAs must adopt policies in their administrative plans that further explain this provision. According to the letter:

Effective July 29, 2016, PHAs may choose, but are no longer required, to reduce the payment standard for a family that remains under HAP contract at the family’s second annual reexamination if, as the result of a decrease in the FMR, the payment standard would otherwise fall outside the basic range. HUD will issue additional guidance on this change in the future.

Family Unification Program (FUP) changes: HOTMA expanded FUP eligibility and increased time limits for eligible youth. The changes were effective upon enactment. HUD issued a letter to FUP executive directors on August 29 to ensure awareness of the changes.

Citizenship preference: This provision applies only to Guam and requires a preference for U.S. citizens and nationals over citizens of the Marshall Islands, Micronesia, and Palau. It was effective upon enactment of HOTMA.

Exception to resident board member requirement: HOTMA provides an exception to the requirement that the board must include at least one public housing resident for the Housing Authority of the County of Los Angeles and for any PHA in the states of Alaska, Iowa, and Mississippi. Since the provision has been in effect for a number of years through appropriations acts, no further action is required.

The letter contained the following guidance on HOTMA implementation:

All of the other sections in HOTMA that impact the HCV and public housing programs require that HUD first issue a notice or regulation for the provision to become effective. Until HUD issues the applicable notices or regulations, your PHA may not implement those additional sections. This information will also be transmitted in the near future via a Federal Register notice.

We realize that many PHAs are eager to implement the flexibilities and other statutory changes provided under HOTMA, so please be assured that HUD is working diligently to develop and provide the necessary implementation guidance in a timely manner. If you have any questions, please send them to

Are you a PIH Alert subscriber? Every Friday, the PIH Alert includes one frequently asked question (FAQ) submitted by our readers. To submit your question, email Annie Stevenson at with the subject line "FAQ Friday." If you'd like to try a free 30-day trial subscription to the PIH Alert, email to get started.

Topics: appropriations, final rule, FMR, HOTMA, PIH Alert, Program News and Notices, proposed rule, Q&A, reasonable accommodation, recertification, rent calculation, seniors and elderly, streamlining, voucher reform legislation

Q&A: Flat rent annual review

Posted by NMA on Sep 6, 2016 12:32:53 PM

Flat rent annual reviewQUESTION    I’m confused about all of the flat rent changes over the past couple of years. I see that HUD has published FMRs for 2017 and I’m not sure what I’m supposed to do with them. Help, please!

ANSWER    You’re correct that HUD published the fair market rents (FMRs) for federal fiscal year (FFY) 2017 on August 26. The FMR data set includes a table of unadjusted rents. Small area fair market rents (SAFMRs) were posted on August 30. Your agency will need one or more of these data sets in order to comply with HUD’s current requirements for reviewing flat rents on an annual basis. The flat rent annual review must be completed within 90 days after the issuance of new FMRs.

The current requirements for determining public housing flat rents were published in the streamlining final rule (published March 8 in the Federal Register) and in Notice PIH 2015-13 (published September 8, 2015). The corresponding regulations are at 24 Code of Federal Regulations 960.253. PHAs are now required to set flat rents at no less than the lower of:

  • 80 percent of the applicable FMR
  • 80 percent of the SAFMR (published for metropolitan areas)
  • 80 percent of unadjusted rents (published for nonmetropolitan areas)

Alternatively, PHAs may apply for an exception waiver through HUD to allow a lower flat rent. For areas in which HUD has not published a SAFMR or unadjusted rent, flat rents must be set at no less than 80 percent of the applicable FMR.

Since FMRs are published annually, PHAs must now review flat rents each year to ensure compliance with the current rule. The following is an excerpt from Notice PIH 2015-13 which describes the requirements for the flat rent annual review:

In order to comply with the flat rent requirements annually, no later than 90 days after issuance of new FMRs or SAFMRs by HUD, the PHA must:

1. Compare the current flat rent amount to the applicable FMR and SAFMR/unadjusted rent:

a) If the flat rent is at least 80 percent of the lower of the FMR or SAFMR/unadjusted rent, the PHA is in compliance with the law, and no further steps are necessary;

b) If the flat rent is less than 80 percent of the lower of the FMR and SAFMR, the PHA must set flat rents at no less than 80 percent of the lower of the FMR or SAFMR/unadjusted rent, subject to the utilities adjustment in this notice, or the PHA may request an exception flat rent pursuant to the requirements of Section 4 of this notice;

2. Update the flat rent policies in the admissions and continued occupancy policies (ACOP) as necessary;

3. At all new admissions, permit the family to choose between the flat rent amount and the income-based rent; and

4. For families that are current public housing residents, offer the updated flat rent amount at the next annual rent option, and permit the family to choose between the flat rent amount and the income-based rent

Flat rent increases must be capped at 35 percent per year. PHAs are no longer permitted to phase in increases of 35 percent or less.

Are you a PIH Alert subscriber? Every Friday, the PIH Alert includes one frequently asked question (FAQ) submitted by our readers. To submit your question, email Annie Stevenson at with the subject line "FAQ Friday."

If you're attending The Housing Conference this month in San Antonio, you can also ask Annie your question in person! Don't miss her sessions on the fair housing final rule and new and upcoming affordable housing legislationRegister online or email for more information.

Topics: final rule, flat rent, FMR, PIH Alert, PIH notices, Program News and Notices, Q&A, streamlining

Q&A: Where are the HUD letters to EDs?

Posted by NMA on May 12, 2016 9:48:20 AM

hands-raised.jpgQUESTION    Recently I saw a reference to a "letter to executive directors" from HUD. I am the ED in my agency and I never received this letter. Are they talking about a paper letter? Where can I find letters to EDs on HUD’s website?

ANSWER    In the past couple of years, HUD has issued several important pieces of guidance in the format of letters to executive directors. Some of the notices contain implementation requirements for new rules or policies (for example, a September letter added 30 days to the portability billing deadline for the HCV program). The HUD letters are transmitted via email and usually they are not posted to HUD’s website.

Some recent examples of letters to executive directors include:

So where does HUD get email addresses for PHA executive directors? The addresses are pulled from the HA Profiles module in HUD’s Inventory Management System/Public and Indian Housing Information Center (IMS/PIC). The contact information is entered by PHA staff and must be updated as needed. The HA Profiles page includes links to a "walkthrough" guide for using the module and a set of frequently asked questions.

If your agency is not receiving these important emails from HUD, there could be several reasons:

  • The email address in HA Profiles no longer exists
  • The email address exists but an employee has left and no one is checking his or her email
  • The email inbox is full
  • The emails are being intercepted by a firewall or anti-spam program

We recommend that you first check the information in the HA Profiles module to make sure that the email address under the Contact tab is current. Next verify that the email inbox can receive mail, and finally, check the settings for your anti-spam software.

Are you a PIH Alert subscriber? Every Friday, the PIH Alert includes one frequently asked question (FAQ) submitted by our readers. Sign up today for a free 30-day trial subscription! Email to get started. To submit your question, email Annie Stevenson at with the subject line "FAQ Friday."

Topics: final rule, FMR, IMS/PIC, PIH Alert, portability, Program News and Notices, Q&A

Q&A: Underpaid subsidies due to PHA error

Posted by NMA on Feb 1, 2016 12:03:48 PM

underpaid subsidiesQUESTION    It’s recently come to my agency’s attention that some of our clients have been paying too much rent. This was due to a calculation glitch and applies to both public housing (PH) residents and participants in the housing choice voucher (HCV) program.

We’ve fixed the error, but what about subsidy underpayments for past months? The monthly underpayments are small amounts but the error existed for several years. Does the PHA have to repay these amounts to our clients? If the agency retains documents for three years, can we limit repayments to the three-year period?

ANSWER    While the HUD regulations do not address this issue, HUD has issued written guidance on the subject. The most recent guidance is in Notice PIH 2007-27, Disallowed Costs and Sanctions Resulting from On-Site Monitoring Reviews. Treatment of underpaid subsidies depends upon the program.

Here’s an excerpt from the section on underpaid subsidy due to PHA error in the HCV program:

PHAs will not be reimbursed for underpayment of subsidies. PHAs are required to reimburse families for overpayment of the total family share. Such reimbursements of the tenant portion of the rent can be made in current and future months through an increase in HAP to the landlord and a decrease in the family share until the family’s overpayment is fully compensated. A PHA may not use funds from its HAP account or HAP net restricted assets to directly reimburse families for overpayment of the total family share. If the family did not receive the full amount of utility reimbursement from the PHA, the PHA must reimburse the family.

Here’s the guidance for the PH program:

PHAs will not be reimbursed for underpayment of subsidies. PHAs are required to reimburse residents for overpayment of tenant rent in accordance with PHA policy.

Since the notice does not require a specific look-back period for reimbursement, it’s probably safe to limit repayment to the period for which the PHA has records. In the HCV program, records from interim and annual reexaminations must be retained for at least three years. In the PH program, record retention periods are determined by policy, and three years is a popular option.

We recommend reimbursing the family for the full period for which the PHA has records for that family, regardless of the agency’s record retention policy. For example, if the family was charged too much rent for seven years and the family’s file contains records for the last five years, reimbursement should be made for five years.

Is keeping up with reexams giving you a headache? NMA can help make the process painless. We'll handle your recertifications offsite, saving money for your agency while ensuring you’re still in compliance. It’s easy—the processing work simply happens in our offices instead of yours. Visit our website or email for more information.

Topics: outsourcing, PIH Alert, PIH notices, program management, Program News and Notices, Q&A, recertification, rent calculation

A note about community service and students

Posted by BEMuser on Sep 1, 2015 2:13:31 PM

community service and studentsIn yesterday's Q&A about community service and students, we pointed out that part-time or full-time students residing in public housing are not exempt from the community service and self-sufficiency requirement (CSSR). Students may, however, be in compliance with the CSSR by performing at least 8 hours per month of self-sufficiency activities. We also advised that such students should be reported as “in compliance” on Form HUD-50058 rather than reported as “exempt.”

A PIH Alert subscriber has brought to our attention the fact that the PIC system will reject a 50058 form where a family member is coded as a full-time student on line 3h and is coded as anything but exempt from the CSSR on line 3q. While this conflicts with the controlling regulations and with Notice PIH 2015-12, it appears that PIC will not currently accept the correct classification for full-time students. We’ll report the error to HUD, and meanwhile PHAs will need to submit Forms 50058 in a manner that will be accepted by PIC.

Thanks to Ohio subscriber Ratico Lake for pointing out the issue.

Are you a PIH Alert subscriber? Every Friday, the PIH Alert includes one frequently asked question (FAQ) submitted by our readers. Sign up today for a free 30-day trial subscription! Email to get started. To submit your question, email Annie Stevenson at with the subject line "FAQ Friday."

Topics: community service, PIH Alert, PIH notices, Program News and Notices, Q&A

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