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President’s Forum: Quiet August? Not This Year

Several Important Matters Pending

PHADA President David A. Northern, Sr.

The month of August is typically a quiet one in Washington D.C. and other parts of the country as people enjoy the last full month of summer with the congressional recess, vacations, and other personal activities. Nevertheless, there is quite a bit happening on some serious policy matters right now. Developments on those issues promise to heat up more by the time of PHADA’s Washington meeting in mid-September.

 

FY 23 HUD Appropriations

The new fiscal year is now less than two months away. The House of Representatives recently adopted its version of a FY 23 HUD appropriations bill, which would increase the Department’s budget by 16.5 percent in the new fiscal year. The House measure contains about $200 million in additional capital funding. Most notably, there are major increases proposed for new vouchers and administrative fees.

Please see the chart on page 3 of the new Advocate for more specifics. As noted in the article accompanying the chart, the Senate has yet to act on any appropriations bills because of disagreements over defense and non-defense spending. Consequently, a final FY 23 budget may not be completed until after the November elections. In any event, Congress would need to adopt a Continuing Resolution by September 30 if there is no budget agreement.

 

More Happening on Key Policy and Regulatory Issues

HUD staff have been developing a new Annual Contributions Contract (ACC) and there have been some meetings on the issue in recent weeks. HUD says the changes are necessary because there are 3–4 different ACCs that HAs are operating under and there is a need to create a uniform version. They also say changes are essential to ensure compliance and better outline the terms and conditions of both operating and capital funding.

Industry groups, including PHADA, have engaged with HUD and expressed our adamant position that any updated version is not based on the one that was circulated a few years. That earlier version included objectional provisions including HUD’s assertion the ACC does not have the full force of contract.

In addition, PHADA’s most serious objection was that the new ACC granted HUD authority to unilaterally modify the contract and even reduce an HA’s funding. HUD has said these unilateral changes will not be included in an updated version but there is still disagreement about the contract issue. At this stage, HUD has committed to sharing a new revised version with us in the coming weeks.

Another major concern is the Build America, Buy America Act (BABA) and new regulations that will be tied to HUD funding.

While the intent to support American manufacturers and products is laudable, PHADA is concerned BABA may drive up costs or cause delays in construction and even maintenance. Some of PHADA’s concerns include:

  • An undefined waiver process lacking details about exceptions.
  • A lack of a manufacturing and sourcing marketplace in the U.S. that could further exacerbate supply chain issues leading to project delays and cost increases.
  • A lack of a construction materials and manufactured products and limited details on the reporting and regulatory requirements associated with BABA.
  • The short implementation timeline and the dearth of Department research into the potential impacts of BABA’s regulations which could be problematic for HAs and the families they serve.

More information on BABA, including our recent comments, are on page 5 of the new Advocate.

This edition also contains information on the comments we just submitted on HUD’s proposed NSPIRE standards, which would significantly alter the scoring system for public housing, RAD, and HCV properties. PHADA has some major concerns and is urging HUD to proceed cautiously with NSPIRE, providing HAs and owners with at least one year of advisory scores. Please see page 13 of the new Advocate for further details.

The Department is also considering a new Physical Needs Assessment (PNA) with a goal of helping HAs more accurately determine their capital needs, in addition to changes in Fair Market Rents (FMRs) for FY 23. We provided HUD our feedback on both of those plans, and they are outlined in this edition, too.

In addition to these prominent issues, PHADA is working on policy recommendations around criminal records checks and screening. This is in response to a Department-wide review of programs to “identify all … HUD regulations, guidance documents and other policies and sub regulatory documents (including model leases and other agreements),” that may pose barriers based on criminal histories, and “propose updates and amendments … to make HUD’s programs as inclusive as possible.”

Lastly, we continue to monitor the high Tenant Account Receivables (TARs) some HAs are experiencing. HUD recently confirmed that almost 20 percent of agencies have been “severely impacted” by rental income losses. As I reported in a recent column, PHADA has called on HUD to address the nonpayment problem head on and clearly state that residents who can afford to pay their rent need to do just that. The Department should also undertake a serious review of its FY 23 budget request to Congress, especially the Operating Fund. That request includes assumptions about inflation that are dated and will not keep pace with true costs.

As you can see, it is far from “quiet” right now on Capitol Hill and at HUD. I encourage all members to stay abreast of developments on these issues. Better yet, come to Washington next month and hear about them firsthand at PHADA’s meeting. Click here for information on our Legislative Forum. I hope to see you then.

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