Update: 2017 HAP and Administrative Fee Set-Aside Funds for the HCV Program

June 2017

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It is already towards the end of May and HUD still has not published any final guidance regarding HAP and Administrative Fee funding. Congress recently approved an Appropriation Bill back in April, but we are still waiting on final funding amounts. HUD did publish PIH Notice 2017-7, “Guidance Related to (1) Eligibility for Potential Shortfall Funding Under the Calendar Year (CY) 2017 Housing Assistance Payments (HAP) Renewal Set-Aside for the Housing Choice Voucher (HCV) Program and (2) CY 2017 Administrative Fees,” which provides potential funding for certain types of HAP and Administrative Fee set-aside funding.

Shortfall HAP

The notice only identifies potential HAP set-aside funds for agencies that are identified as shortfall. If the PHA is in shortfall and the PHA wants to qualify for the shortfall set-aside fund, then the PHA must adhere to the following:

1. The PHA will work with their local Field Office (FO) and/or the Short Fall Prevention Team (SPT) and will provide data to assist to monitor the financial position of the PHA.

2. The PHA has stopped issuing vouchers to applicants as of the date the PHA is notified of the potential shortfall by the SPT. This requirement does not apply to the following:

a. Families that are participants and were issued a voucher to move to a different unit;

b. Tenant protection vouchers that are being issued to targeted families that were residing in the covered property on the eligibility event; and

c. Where the PHA is leasing under the HUD-VASH program, up to the baseline level of units under all HUD-VASH allocations, including turnover of HUD-VASH vouchers.

3. The PHA has rescinded any vouchers remaining on the street that were issued to applicant families and has stopped leasing those rescinded vouchers as of the date the PHA is notified of the potential shortfall by the SPT.

4. The PHA has ceased absorbing portable vouchers as of the date the PHA is notified of the potential shortfall by the SPT.

5. In regard to project-based voucher (PBV) HAP contracts, vouchers are not issued to a family that wants to voluntarily move with tenant-based assistance.

a. However, if a unit becomes vacant, the PBV unit shall be filled with a family from the waiting list.

Administrative Fee Set-Aside

HUD intends to make up to $10 million available from Administrative Fee funding to PHAs that need additional funds to administer their Section 8 programs, if the 2017 full-year CR or full-year appropriation makes such set-aside funding available.

1. Homeownership Fees: A $200 special fee is granted for every homeownership closing reported in PIC. PHAs do not need to apply for these funds.

2. Special Fees for Multifamily Housing Conversion Actions: A special (one-time) fee of $200 will be provided for each unit occupied on the date of the eligibility event. PHAs do not need to apply for these funds.

3. Special Fees for Portability: Receiving PHAs must be administering port-in vouchers which equal 20% or more of the PHAs total number of leased vouchers as of December 31, 2016, to be eligible for special portability fees. For each eligible port-in voucher, the receiving PHA will receive 12 months of funding equal to five percent (5%) of the PHA’s 2017 Column A rate for administrative fees.

4. Special Fees for Audit Costs Related to HCV Voluntary Transfers: Refer to section 6 of PIH Notice 2015-22 for requesting these funds.

5. Other Special Fees Under the Secretary’s Discretion: HUD will consider requests for other unanticipated increases in Administrative Fees on a case-by-case basis.

A blended rate fee for PHAs that administer the HCV program in multiple rate areas and a higher Administrative Fee rate request were also offered under the guidance released this year thus far.

If you have questions related to matters discussed above, please contact Brian Alten.

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