As we know, public housing funding for April is at a 73% proration level. HUD plans to issue a second funding to bring the April proration level up to 79%.
The business of owning and managing affordable housing in decent, safe, and sanitary condition and in good repair remains our mission. PHAs need to plan more strategically than ever before. So, as all businesses must ask in tough times: How can we maximize dollars and cut costs?
A common denominator you'll see in many of these tips is a commitment to strategic planning. Leadership, a plan, and smart work will guide your PHA and staff through turbulent times.
Another common denominator is highly competent property managers. Managers with a high level of knowledge, skills, and abilities will ensure that properties are run as financially viable businesses.
Of key importance is accurate and timely data about, and from, your projects. You need to monitor and track performance of the properties and portfolio over time. This trend analysis will clearly demonstrate if the projects' performance is improving (good), staying the same (depends), or going downhill (not good).
Maximize dollars
The quality of public housing projects has everything to do with occupancy. Especially in larger housing authorities that have implemented HUD's project-based model of accounting, budgeting, and management, the projects are the economic engine of the public housing program.
Occupancy is the key to success; a vacant unit (other than the HUD-exempt units) generates no income and in fact loses money in two ways: no rent, and no operating subsidy. Therefore, a high occupancy rate and quick turnaround time is essential to a financially viable public housing program.
Tip #1: Maximize occupancy.
If any project has over a 2 percent or 3 percent vacancy rate, start gathering the diagnostic facts by looking at the turnaround time. Is it taking too long to fill vacant units? Is the project's average make-ready time more than five to seven days? At peak times, or if you have a lot of vacant units not ready for lease-up, consider contracting out the make-readies to get it done quickly.
If turnaround days are mostly taken up in lease-up time (for example, more than seven days), do you have a robust waiting list? If you do, are unit offers being made effectively and efficiently? Is the eligibility crew processing enough applications to have a full pool of verified applicants ready to fill all your vacancies? Your waiting list supervisor needs to know approximately how many applicants to process in order to result in filling all vacant units.
It may take 25 applicants to result in one lease-up, or it may take much less. The waiting list supervisor needs to have this historic data. I managed a waiting list of 40,000 (this was both PH and Section 8) with 1,800 public housing units. We pulled hundreds of applications each month to maintain an occupancy rate of 99 percent.
Look at your offer system. Nothing prohibits you from offering the same unit to more than one approved applicant at a time. For example, you could revise your ACOP to offer a vacant unit to a specific number of verified applicants at one time.
The offer letter would make it clear that the approved family with the highest waiting list priority who accepts the unit by the deadline (we advise three to four days as a deadline) will get the unit. Families who don't have the highest priority who accept the unit within the deadline will be given another offer (or offers, depending on ACOP policy), and this offer will not be counted. Of course, the PHA (hopefully, your software) must closely track its offers.
We'll talk more about how you can maximize occupancy in the next four tips.
Next: Working with sequestration in the public housing program: Tip #2
NMA senior associate Cara Gillette trains, consults, and provides technical assistance nationwide in fair housing, public housing management, hearings, economic self-sufficiency, and governing boards. Prior to joining NMA, Ms. Gillette served at the San Diego Housing Commission, administering its public housing and Section 8 waiting lists, serving as hearing officer, managing public housing, and overseeing resident economic development programs. She has previously written for the NMA blog about blended occupancy projects.
If you find that you need staffing help during sequestration, NMA can assist your agency with recertifications (done remotely), quality control, outsourced hearing officer services (done remotely), HQS inspections, and more. Email sales@nanmckay.com for more information.
