HUD publishes proposed rule on streamlining admin regs

Today in the Federal Register, HUD published a proposed rule aimed at streamlining administrative regulations for the public housing (PH), housing choice voucher (HCV), and multifamily housing programs. The rule combines changes in the 2014 appropriations act, elements of HUD’s 2013 temporary compliance options, and other streamlining changes. Comments are due by March 9, 2015.

2014 Appropriations Act Changes

HUD has issued interim guidance on the appropriations act changes in Notice PIH 2014-12 and in a Federal Register notice published on June 25, 2014. Today’s notice opens the formal rulemaking process for regulatory changes in the determination of PH flat rents, HCV utility allowances and biennial inspections, and the definition of extremely low income. HUD plans to publish a separate notice on the act’s provision for PHA consortia.

Temporary Compliance Assistance

The proposed rule would give PHAs the option to permanently adopt one or more of the streamlining strategies first offered in Notice PIH 2013-03 (and later extended by Notice PIH 2013-26). The options applicable to both the PH and HCV programs include:

• Use of actual past income for rent calculations
• Family self-certification of assets when total assets do not exceed $5,000 in value
• Streamlined annual reexaminations for elderly and disabled families with fixed incomes

The proposed rule would also make permanent the PHA option of approving exception payment standards in the HCV program. PHAs could approve exceptions between 111 percent and 120 percent of fair market rent (FMR), bypassing the field office approval process.

Additional Streamlining Measures

Today’s notice also contains a number of proposed regulatory changes intended to reduce program costs and/or administrative burdens. The changes applicable to the PH, HCV, and multifamily programs include:

• Revision of the rule on documentation of social security numbers (SSNs). The proposed rule would permit PHAs to defer documentation for children less than 6 years of age in applicant families for up to 90 days after admission, in cases where the child does not yet have an SSN.
• Exclusion of mandatory fees from student financial aid, where applicable. While this change is categorized as applicable to all programs, student financial aid is currently excluded from annual income in the PH program.

Proposed changes applicable to the PH and HCV programs include:

• A provision for issuing utility reimbursement payments quarterly, rather than monthly, when the quarterly total does not exceed $20.
• Revisions to the regulations governing the earned income disallowance (EID). The proposed rule would limit EID eligibility to 24 consecutive months, eliminating the need for tracking the exclusion over a period of up to 48 months. The rule would retain the current 12-month full exclusion period, and would then offer PHAs the flexibility to phase in a rent increase by excluding at least 50 percent of increased income for an additional 12 months, for family members who remain continuously employed. Note: the current EID rules would remain in effect for participants assisted under the Housing Opportunities for Persons with AIDS (HOPWA) program.

The notice also proposes the following changes applicable to only the PH program:

• Substitution of flat rent for “public housing maximum rent” in the calculation of prorated rent for mixed families. The rule would also correct a calculation anomaly that causes prorated rent to decrease when a mixed family’s income exceeds the maximum rent amount.
• The option of accepting resident self-certification of compliance with community service requirements.
• Streamlining and simplification of grievance procedures.
• A clarification that the number of vacant units eligible for operating subsidy is limited to 3 percent of total units, on a project-by-project basis.

Finally, the proposed rule includes the following changes applicable to the HCV program:

• An option to limit move-ins to certain days of the month, such as the first. This option would reduce the need for prorated payments and would eliminate overlapping payments.
• The option to charge reinspection fees to owners, when the owner reports that an HQS violation has been corrected but inspection reveals that the violation still exists. The optional reasonable fee could be charged to owners, but not to program applicants or participants.
• Revision of the regulations governing utility allowance schedules. The proposed rule would permit PHAs to classify units as “attached” or “detached,” reducing the number of unit types for which allowances must be calculated.

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