QUESTION We are confused about the rule that HUD published last month implementing the FAST Act. I thought that the law authorized triennial reexams but the rule doesn’t reflect that. Even in the years between “full” reexams it sounds like the PHA still has to apply a COLA to fixed income, adjust payment standards/utility allowances, etc. How does this compare to the streamlining final rule that was published a couple of years ago?
ANSWER You’re correct that the FAST Act “interim final rule,” published in the Federal Register on December 12, does not authorize PHAs to completely bypass annual reexaminations for three years. Rather, it permits PHAs to conduct “full income recertifications” every three years for qualifying families. Other annual activities must still be conducted every year.
You’re also correct that the FAST Act partially duplicates an option available under the streamlining final rule, published in March 2016. HUD chose to implement the two rules separately, as explained in the streamlining rule:
HUD recognizes that prior to the issuance of this final rule, the Fixing America’s Surface Transportation Act, or FAST Act, was signed into law. Section 78001 of that Act modified the 1937 Act to allow PHAs and owners to undergo full income recertification for families with 90 percent or more of their income from fixed-income sources every three years instead of annually. HUD believes that while the FAST Act provisions and the provisions contained in this rule are very similar, they offer different benefits; therefore, HUD is retaining the flexibilities in this final rule and will issue implementation regulations for the FAST Act separately.
Let’s take a look at the options for streamlining annual reexams in both rules. Under the streamlining final rule:
- PHAs may choose to verify income from fixed income sources at admission and once every three years thereafter
- A published cost of living adjustment (COLA) must be applied to the family’s fixed income in years two and three
- All non-fixed income must be verified annually
Under the FAST Act:
- PHAs may choose to verify income from fixed income sources at admission and once every three years thereafter.
- A published cost of living adjustment (COLA) must be applied to the family’s fixed income in years two and three.
- If the family receives at least 90 percent of its income from fixed income sources, the PHA may, but is not required to, verify non-fixed income in years two and three.
- If less than 90 percent of income is from fixed income sources, non-fixed income must be verified annually.
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