HUD’s Office of Public and Indian Housing (PIH) posted Notice PIH 2022-09 on April 11, extending to September 30 the deadline for public housing agencies (PHAs) to request expedited PIH review of three key Housing Choice Voucher (HCV) regulatory waivers. These waivers were originally allowed in Notice PIH 2021-14 and Notice PIH 2022-04 (see Memo, 12/20/21 and 3/7) as authorized by the “CARES Act” (see Memo, 5/10/21). Notice PIH 2022-09 includes the same HCV provisions as previous Notices allowing PHAs to provide higher HCV payment standards and allow households more time to search for a home to lease with a new voucher. Notice PIH 2022-09 differs from the two previous Notices by giving examples of the reasons for which a PHA might seek an expedited waiver and the methods for certifying that there is good cause to increase the payment standard.
The three HCV expedited waivers are as follows:
- PHAs may grant households one or more extensions of the initial voucher term (the time available to a household with a new voucher to lease a unit, which is generally 60 days.)
- PHAs may adopt a payment standard above the usual maximum of 110% of the Fair Market Rent (FMR) up to 120% of FMR. If PIH approves, this payment standard will only apply to fiscal year (FY) 2022 FMRs and must revert to the basic range (between 90% and 110% of FMR) for FY23. PHAs may also seek approval to establish an alternative payment standard up to 120% of the Small Area FMR (SAFMR) for a ZIP code.
- PHAs may increase a household’s voucher payment standard at any time, rather than waiting for the household’s next regular income reexamination.
The amount of the HCV subsidy for a household is capped at a “payment standard” set by a PHA and must be between 90% and 110% of the FMR (that is, the rent in a given metropolitan area for a modest apartment). HUD sets FMRs annually. Normally, a PHA may request HUD Field Office approval of an “exception payment standard” up to 120% of the FMR for a designated part of an FMR area. In addition, an exception payment greater than 120% of the FMR can be requested but must be approved by the PIH Assistant Secretary. In either case, a PHA must demonstrate that the exception payment is necessary to help households find homes outside areas of high poverty or because households have trouble finding homes within the 60 days allowed for identifying a landlord who will accept a voucher. Notice PIH 2022-09 can hasten this process.
SAFMRs reflect rents for U.S. Postal ZIP Codes, while traditional FMRs reflect single rent standards for entire metropolitan regions. SAFMRs are meant to provide voucher payment standards that are more closely aligned with neighborhood-scale rental markets, resulting in relatively higher subsidies in neighborhoods with higher rents and greater opportunities, and lower subsidies in neighborhoods with lower rents and concentrations of voucher holders.
Section 4 of Notice PIH 2022-09 states a PHA must explain why a waiver is needed, the negative effect on voucher applicants if a waiver is not allowed, and how long the PHA expects the waiver to be needed. The waiver duration should be limited to the time necessary for a PHA to resume normal operations but may not extend beyond December 31, 2022.
If a PHA seeks to establish a payment standard from 111% to 120% of the FMR, the PHA must certify that it satisfies one of three “good cause” conditions:
- HUD has identified the PHA’s FMR area as one with significant rental market fluctuations. An attachment to the Notice lists 227 such areas.
- A PHA has a voucher utilization rate of less than 98% for the current year-to-date or saw a more than 5% reduction in the utilization rate between 2019 and 2021. (“Utilization rate” refers to the greater of HCV unit-months leased divided by unit-months available, or the total Housing Assistance Payment (HAP) spent divided by a PHA’s HCV budget authority.)
- Fewer than 85% of the vouchers issued by a PHA have been leased over the last six months.
Read Notice PIH 2022-09 at: https://bit.ly/3jEYmDm
Read more about Housing Choice Vouchers on page 4-1 of NLIHC’s 2022 Advocates’ Guide.