Changes proposed at the end of HUD’s FY12 budget request would provide the HUD Secretary greater flexibility in publishing and providing for public review of Fair Market Rents (FMRs). Conversely, the proposal would limit HUD’s discretion in granting exception payment standards for disabled households, devolving this decision to housing authorities.
This FMR proposal primarily focuses on the process of determining and releasing the FMRs. It provides that FMRs “shall be published not less than annually” and made available on the Department's website and “in any other manner specified by the Secretary.” Rather than publishing proposed and final FMRs in the federal register, and having a time for public comment in between, under the proposed rules HUD will be allowed to publish the notice of their release in the register and the FMRs would become effective “no earlier than” 30 days afterwards. Under the proposal, HUD would also develop a procedure to receive comments and provide for the reevaluation of specific FMRs. The proposed change also would require HUD to post a notice and receive public comment on any “material changes” in the methodology for estimating FMRs.
A second change to FMRs is that there would be explicit direction that a public housing agency is not “required” to reduce the payment standard applied to a family continuing to reside in a unit when the FMR is decreased. While FMRs have long fluctuated up and down, this statement appears particularly important as HUD implements it small area FMR demonstration and is likely to develop other reforms to the FMRs as five-year ACS and decennial Census data become available. Another proposed exception is to allow a public housing agency to establish a payment standard of 120 percent of the FMR in the voucher program as a reasonable accommodation for a person with a disability “without approval of the Secretary.”
In general, NLIHC welcomes these changes, which should streamline the FMR process and reduce the burden on HUD while protecting tenants and increasing the usefulness of the program to those with disabilities.
One concern is the absence of a date certain or deadline for release of the FMRs. Currently, FMRs must by statute be released by October 1, the beginning of the fiscal year in which they are meant to apply. Recent changes in the data available for calculating FMRs have meant that meeting this deadline excludes the most recent ACS data, which are prepared over the summer and released in the fall. While NLIHC recognizes that the date should likely be changed to accommodate the ACS data, a new deadline should be established. Experience with the release of HUD income limits, which have no such statutory deadline, shows that without such a target date important program data can appear at any time in the first five months of the year. When they appear also seems to be somewhat arbitrary depending on other work being done by the division that generates the FMRs. With a streamlined and shortened public comment process, this uncertainty greatly reduces opportunities for public oversight.