[Federal Register Volume 60, Number 84 (Tuesday, May 2, 1995)]
[Notices]
[Pages 21548-21551]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-10685]



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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. N-95-3848; FR 3795-N-01]


Privacy Act of 1974; Matching Program: Matching Tenant Data in 
Assisted Housing Programs

AGENCY: Office of the Assistant Secretary for Administration, HUD.

ACTION: Notice of matching program.

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SUMMARY: Pursuant to the Computer Matching and Privacy Protection Act 
of 1988, as amended, and the Office of Management and Budget's Guidance 
on the statute, HUD announces a revised matching program involving 
comparisons between income data provided by applicants or participants 
in HUD's assisted housing programs and independent sources of income 
information. The matching program will be carried out to detect 
excessive housing assistance under the National Housing Act, the United 
States Housing Act of 1937, and section 101 of the Housing and 
Community Development Act of 1965. The program provides for the 
verification of the matching results and the initiation of appropriate 
administrative or legal actions, primarily through public housing 
agencies, Indian housing authorities, and private owners/management 
agents for subsidized multifamily projects.
    This notice provides an overview of computer matching for HUD's 
assisted housing programs. Specifically, this notice:
    (1) Adds Social Security Administration (SSA) and Internal Revenue 
Service (IRS) data concerning earned and unearned income to the 
matching program as independent sources for computer matching;
    (2) Describes verification processes for the SSA and IRS matching 
that differ from processes previously used;
    (3) Expands the matching to cover social security and supplemental 
social security income data maintained by the SSA; and
    (4) Recognizes the transfer of computer matching/tenant income 
verification functions from HUD's Office of Inspector General to 
offices that administer the assisted housing programs. Those offices 
include the Office of the Assistant Secretary for Public and Indian 
Housing and the Office of the Assistant Secretary for Housing--Federal 
Housing Commissioner.
    This notice also sets forth new starting and ending dates for the 
matching program.

EFFECTIVE DATES: HUD anticipates that during the third quarter of 
calendar year 1995 it will: (a) Request that SSA and IRS conduct the 
initial computer matching, and (b) compare SSA and IRS matching results 
to its tenant data.
    During the third quarter of calendar year 1995, HUD plans to 
initiate the tenant income verification process for a limited number of 
organizations that administer HUD assisted housing programs. HUD 
anticipates that the tenant income verification process will be 
expanded in Fiscal Year 1996 to include more organizations that 
administer HUD assisted housing programs. The projected dates for SSA 
and IRS matching are effective unless comments are received that result 
in a contrary determination, and HUD withdraws this notice.
    The computer matching described in this notice may begin after 
compliance with the reporting requirements cited in section 4 of 
Appendix I to OMB Circular No. A-130--Federal Agency Responsibilities 
for Maintaining Records About Individuals (59 FR 37916; July 25, 1994). 
That section [[Page 21549]] requires that Federal agencies provide the 
Chair of the House Committee on Government Operations, the Chair of the 
Senate Committee on Government Affairs, and the Office of Management 
and Budget with notice of the matching program and computer matching 
agreements 40 days before operating the program.

ADDRESSES: Interested persons are invited to submit comments regarding 
this notice to the Rules Docket Clerk, Office of General Counsel, Room 
10276, Department of Housing and Urban Development, 451 Seventh Street, 
SW, Washington, DC 20410-0500. Communications should refer to the above 
docket number and title. Facsimile (FAX) comments are not acceptable. A 
copy of each communication submitted will be available for public 
inspection and copying between 7:30 a.m. and 5:30 p.m. weekdays at the 
above address.

FOR FURTHER INFORMATION CONTACT: For Privacy Act: Jeanette Smith, 
Departmental Privacy Act Officer, Room 4178, Department of Housing and 
Urban Development, 451 Seventh Street, SW, Washington, DC 20410, 
telephone number (202) 708-2374. Hearing- or speech-impaired 
individuals may call (202) 708-1112 (Federal Information Relay 
Service--TDD). For further information from recipient agency: David L. 
Decker, Director, Computer Matching Activities, Office of the Public 
and Indian Housing Comptroller, Room 5156, Department of Housing and 
Urban Development, 451 Seventh Street, SW, Washington, DC 20410, 
telephone number (202) 708-0099, TDD--(202) 708-0850; or Barbara D. 
Hunter, Acting Director, Planning and Procedures Division, Office of 
Multifamily Housing Management, Room 6180, Department of Housing and 
Urban Development, 451 Seventh Street, SW, Washington, DC 20410, 
telephone number (202) 708-3944, TDD--(202) 708-4594. (These telephone 
numbers are not toll-free.)

SUPPLEMENTARY INFORMATION: This notice supersedes a similar notice 
published in the Federal Register on December 12, 1991 (56 FR 64793).
    The Computer Matching and Privacy Protection Act of 1988, as 
amended (5 U.S.C. 552a) (the CMPP Act), the Office of Management and 
Budget's (OMB's) guidance on this statute entitled ``Final Guidance 
Interpreting the Provisions of Public Law 100-503, the Computer 
Matching and Privacy Protection Act of 1988'' (OMB Guidance), and OMB 
Circular No. A-130 require publication of notices of computer matching 
programs. OMB's Guidance augments the ``OMB Guidelines on the 
Administration of the Privacy Act of 1974'' that were issued July 1, 
1975. Appendix I to OMB's Revision of Circular No. A-130, ``Transmittal 
2, Management of Federal Information Resources,'' prescribes Federal 
agency responsibilities for maintaining records about individuals. In 
accordance with the CMPP Act and Appendix I to OMB Circular No. A-130, 
copies of this notice are being provided to the Committee on Government 
Operations of the House of Representatives, the Committee on 
Governmental Affairs of the Senate, and OMB's Office of Information and 
Regulatory Affairs.

I. Authority

    This matching program is being conducted pursuant to sections 3003 
and 13403 of the Omnibus Budget Reconciliation Act of 1993 (Pub. L. 
103-66, approved August 10, 1993); section 904 of the Stewart B. 
McKinney Homeless Assistance Amendments Act of 1988 (42 U.S.C. 3544); 
section 165 of the Housing and Community Development Act of 1987 (42 
U.S.C. 3543); the National Housing Act (12 U.S.C. 1701-1750g); the 
United States Housing Act of 1937 (42 U.S.C. 1437-1437o); and section 
101 of the Housing and Urban Development Act of 1965 (12 U.S.C. 1701s).
    The Omnibus Budget Reconciliation Act of 1993 (Budget 
Reconciliation Act) authorizes HUD to request from the Social Security 
Administration (SSA) and the Internal Revenue Service (IRS) return 
information as prescribed in section 6103(l)(7) of title 26 of the 
United States Code (Internal Revenue Code). The Budget Reconciliation 
Act limits HUD's access to tax return data and prohibits HUD's 
redisclosure of tax return data to public housing agencies and Indian 
housing authorities (collectively referred to as HAs), and private 
owners/management agents for subsidized multifamily projects. However, 
it allows HUD to disclose the fact that discrepancies exist between 
information provided by the tenant and other sources, and to request 
reverification of income in light of the tenant's uncertain eligibility 
for, or level of, benefits.
    The Budget Reconciliation Act requires that applicants and 
participants in assisted housing programs sign a consent form 
authorizing the Secretary of HUD to request that the Commissioner of 
Social Security and the Secretary of the Treasury release the return 
information. A final rule regarding participants' consent to the 
release of information was published by HUD in the Federal Register on 
March 20, 1995 (60 FR 14632).
    The Stewart B. McKinney Homeless Assistance Amendments Act of 1988 
authorizes HUD and HAs (but not private owners/management agents for 
subsidized multifamily projects) to request wage and claim information 
from State Wage Information Collection Agencies (SWICAs) responsible 
for administering State unemployment laws in order to undertake 
computer matching. This Act authorizes HUD to require applicants and 
participants to sign a consent form authorizing HUD or the HA to 
request wage and claim information from the SWICAs.
    The Housing and Community Development Act of 1987 authorizes HUD to 
require applicants and participants (as well as members of their 
households six years of age and older) in HUD-administered programs 
involving rental assistance to disclose to HUD their social security 
numbers (SSNs) as a condition of initial or continuing eligibility for 
participation in the programs.

II. Objectives To Be Met by the Matching Program

    HUD's primary objective in implementing the computer matching 
program is to increase the availability of housing assistance to 
individuals who meet the requirements of the housing assistance 
programs. Other objectives include identifying and recouping excessive 
housing assistance received by tenants, and deterring future abuses of 
assisted housing programs.
    HUD's various assisted housing programs, available through HAs or 
subsidized multifamily project owners/management agents, require that 
applicants meet certain income and other criteria to be eligible for 
housing assistance. In addition, tenants are required to report the 
amount and sources of their income on at least an annual basis. The 
matching program will identify tenants receiving excessive housing 
assistance resulting from unreported or underreported family income. 
When the excessive housing assistance is identified, these tenants 
frequently move out of assisted housing units, increasing funds or 
units available to serve the intended beneficiaries of HUD programs. 
Further, program administrators may collect excessive housing 
assistance from those tenants. Some tenants may continue to receive 
housing assistance but will be required to increase their contributions 
toward rent, and to re-pay excessive housing assistance.

III. Program Description

    In this computer matching program, tenant-provided information 
included [[Page 21550]] in HUD's automated files will be compared to 
data from the SSA and the IRS, as well as from SWICAs and the Office of 
Personnel Management (OPM). HUD intends the SSA and IRS matching to be 
a continuing program for assisted housing programs nationwide. HUD will 
normally request that the SSA conduct matching of earned income 
information, and that the IRS conduct matching of unearned income 
information, on an annual basis. HUD will request SSA matching of 
social security and supplemental social security income information 
monthly. Initially HUD may limit the matching or the verification 
process to selected HAs and private owners/management agents to test 
the effectiveness of the computer matching and tenant income 
verification processes.
    HUD anticipates that it will only conduct SWICA matching in 
selected States. Furthermore, HUD anticipates that the extent of SWICA 
and OPM matching will decrease in future years, after the effectiveness 
of SSA and IRS matching and income verification has been demonstrated. 
HAs may also request SWICA matching.
    HUD will disclose to the SSA, IRS, and SWICAs only tenant personal 
identifiers, i.e., SSNs, surnames, dates of birth, and sex. The SSA, 
IRS, and SWICAs will conduct the matching of the HUD-provided personal 
identifiers to personal identifiers included in their automated files. 
Those agencies will provide income data to HUD only for individuals 
with matching personal identifiers.
    The process of income matching between HUD and the OPM varies from 
the above. The OPM will disclose its data to HUD, and HUD will actually 
conduct the computer matching to OPM data.
    HUD will then compare the SSA, IRS, OPM, and SWICA income data to 
tenant-reported income data included in HUD's system of records known 
as the Tenant Housing Assistance and Contract Verification Data (HUD H-
11). This comparison will identify, based on criteria established by 
HUD, tenants whose income(s) require further verification.

A. Income Verification

    HUD will normally request that HAs or private owners/management 
agents verify matching results as described below. However, under 
certain limited circumstances HUD may verify tenant income(s) with 
independent income sources. For example, such circumstances may include 
when: (a) HUD declares an HA in breach of an annual contributions 
contract; or (b) the tenant fails to disclose SSA and IRS data, the 
tenant has committed other serious violations, and HUD's analysis of 
the data could support legal actions. HUD may send letters to employers 
to request income data, but HUD will not disclose tax return data to 
HAs, private owners/management agents, employers, or payors.

(1) Verification of SSA and IRS Data Referenced in Section 6103(l)(7) 
of the Internal Revenue Code

    Since HUD cannot redisclose tax return data directly to HAs or 
private owners/management agents, HUD plans to notify tenants of 
discrepancies between the tenant-reported income and the SSA and IRS 
data. HUD will supply the tenant with income information taken directly 
from SSA and IRS data and request that the tenant provide this 
information to the HA or private owner/management agent. Concurrently, 
HUD will notify the HA or the private owner/management agent that a 
discrepancy exists between information provided by the tenant and other 
sources and will request reverification of the tenant's income. This 
notification will not include any tax return information.
    Income information that tenants disclose to the HA or private 
owners/management agents will be verified directly with the income 
source or with the tenant. Tenants who fail to report to the HA or 
private owner/management agent after HUD's initial notice will receive 
a second notice sent by the HA or private owner/management agent. If 
the tenant still fails to provide the information to the HA or private 
owner/management agent, the HA or private owner/management agent may 
then terminate housing assistance, after providing the tenant an 
opportunity to grieve any adverse action.
    The SSA and the IRS have advised HUD that the process described in 
the preceding paragraph is consistent with the intent of section 
6103(l)(7) of the Internal Revenue Code, as the intent of the matching 
is to create a dialogue between the benefit recipient and the benefit 
provider.

(2) Verification of Social Security and Supplemental Social Security 
Income Data

    Unlike the income return information supplied by the SSA and the 
IRS, HUD may disclose SSA Title 2 (social security) and Title 16 
(supplemental social security income) data to HAs and private owners/
management agents. Therefore, after receiving this data from the SSA 
and comparing it to tenant-reported income, HUD will disclose the SSA 
social security and supplemental social security income data to HAs and 
private owners/management agents. These disclosures will be limited to 
those instances in which a significant disparity exists between the SSA 
and the tenant-reported data. HAs and private owners/management agents 
will then notify the tenant if a disparity exists that affects the 
tenant's housing assistance.

(3) Verification of SWICA Data

    HUD will disclose matching results for SWICA wage and unemployment 
claim data directly to HAs, but not to private owners/management 
agents. The comparison of SWICA wage information and the tenant-
reported data will reveal whether income verification is necessary. The 
HA must then obtain wage information directly from the tenants' 
employer(s), including information from prior years when appropriate. 
The SWICA unemployment claim data must be verified with the tenant. 
Verification with the SWICA would only be required if the tenant 
disputes the SWICA claim data.

(4) Verification of OPM Data

    HUD will disclose matching results for OPM data to HAs and private 
owners/management agents. The OPM data, when compared to the tenant-
reported data, provides an indicator that income verification is 
necessary. The HAs and private owners/management agents may then obtain 
wage information directly from the employer(s), including information 
from prior years when appropriate.

B. Administrative or Legal Actions

    Regarding all the matching described in this notice, HUD 
anticipates that HAs and private owners/management agents will take 
appropriate actions in consultation with the tenant to resolve the 
disparities between tenant-reported and independent income source data. 
If appropriate, the HAs and private owners/management agents will 
increase the tenant's contribution toward rent, i.e., reduce the 
housing assistance provided.
    After verifying that the tenant had access to income that the 
tenant did not report, the HA or project owner/management agent will:
    (1) Notify the tenant in writing of any findings;
    (2) Calculate the unreported income and excessive housing 
assistance received by the family;
    (3) Offer the tenant an opportunity to contest any findings;
    (4) Provide a grievance hearing or a right to contest to the 
tenant, if requested; and [[Page 21551]] 
    (5) Initiate, as appropriate, administrative or legal actions to 
resolve the tenant's underpayment of rent, using guidelines in HUD 
regulations and handbooks.
    The HAs and private owners/management agents may not suspend, 
terminate, reduce, or make a final denial of any housing assistance to 
any individual as the result of information produced by this matching 
program until: (a) The individual has received notice from that agency 
containing a statement of its findings and informing the individual of 
the opportunity to contest such findings; and (b) either the notice 
period provided in applicable regulations of the program, or 30 days, 
whichever is later, has expired. In most cases, the discrepancy will be 
resolved through consultation between the tenant and the HA or private 
owner/management agent.
    In legal actions, HAs and private owners/management agents may 
refer cases to local law enforcement entities or HUD's Office of 
Inspector General (OIG) for possible investigation and prosecution, 
either criminally or civilly. Referrals to the OIG should involve only 
egregious cases.

C. Reporting on Computer Matching/Income Verification Results

    HUD plans to prescribe a methodology (probably electronic) for HAs 
and private owners/management agents to report computer matching/income 
verification results to HUD. The reporting methodology will measure the 
effectiveness of the computer matching program. In developing the 
methodology, HUD will avoid imposing any unnecessary burden on HAs and 
private owners/management agents. The reporting requirement will be 
submitted to OMB for approval under the Paperwork Reduction Act of 1980 
(44 U.S.C. Chapter 35), and a notice of this submission will be 
published in the Federal Register.

IV. Records To Be Matched

    SSA and IRS will actually conduct the matching of tenant SSNs and 
additional identifiers (such as surnames and dates of birth) to tenant 
data that HUD supplies from its system of records known as the Tenant 
Housing Assistance and Contract Verification Data (HUD H-11). Within 
HUD, this system of records includes two automated systems known as the 
Multifamily Tenant Characteristics System (a system for programs under 
the Office of the Assistant Secretary for Public and Indian Housing) 
and the Tenant Rental Assistance Certification System (a system for 
programs under the Office of the Assistant Secretary for Housing--
Federal Housing Commissioner). HAs and private owners/management agents 
for subsidized multifamily projects provide HUD with the data included 
in HUD H-11.
    The SSA will match the HUD H-11 records to the SSA's Earnings 
Recording and Self-Employment Income System (HHS/SSA/OSR, 09-60-0059) 
(Earnings Record); Master Beneficiary Record (HHS/SSA/OSR, 09-60-0090) 
(MBR); and Supplemental Security Income Record (HHS/SSA/OSR, 09-60-
0103) (SSR). The IRS will match the HUD H-11 records to its Wage and 
Information Returns (IRP) Master File (Treas/IRS 22.061). The IRS also 
refers to this file as the Information Return Master File (IRMF).
    HUD's Assistant Secretary for Public and Indian Housing (PIH) will 
place matching data into its Tenant Eligibility Verification Files 
(HUD/PIH-1), as provided in a notice published in today's Federal 
Register. The HUD/PIH-1 files are specifically exempt from certain 
provisions of the Privacy Act, as described in a notice published on 
February 28, 1994 (59 FR 9406) and a notice published on March 30, 1994 
(59 FR 14869). HUD's Assistant Secretary for Housing--Federal Housing 
Commissioner will consider matching data as a component of HUD H-11.
    HUD may also coordinate SWICA income computer matches for its 
rental assistance programs using tenants' SSNs and surnames. SWICAs 
will match tenant records to machine-readable files of quarterly wage 
data and unemployment insurance benefit data. Results from this 
matching will be provided to HUD or HAs, which will then determine 
whether tenants have unreported or underreported income. The matching 
will be done in accordance with a written agreement between the SWICA 
and HUD.
    In addition, tenants' SSNs may be matched to the OPM's General 
Personnel Records (OPM/GOVT-1), the Civil Service Retirement and 
Insurance Records System (OPM/Central-1), and the Department of 
Defense's Defense Manpower Data Center Data Base (S322.10.DMDC). The 
tenant data may be matched to the SSA's Master Files of Social Security 
Number Holders (HHS/SSA/OSR, 09-60-0058) and Death Master Files for the 
purpose of validating SSNs contained in tenant records. These records 
will also be used to validate SSNs for all applicants, tenants, and 
household members who are six (6) years of age and over to identify 
noncompliance with program eligibility requirements. HUD will compare 
tenant SSNs provided by HAs or private owners/management agents to 
reveal duplicate SSNs and potential duplicate housing assistance.

V. Period of the Match

    The computer matching program will be conducted according to 
agreements between HUD and the SSA, IRS, OPM, and SWICAs. The computer 
matching agreements for the planned matches will terminate either when 
the purpose of the computer matching program is accomplished, or 18 
months from the date the agreement is signed, whichever comes first.
    The agreement may be extended for one 12-month period, with the 
mutual agreement of all involved parties, if the following conditions 
are met:
    (1) Within 3 months of the expiration date, all Data Integrity 
Boards review the agreement, find that the program will be conducted 
without change, and find a continued favorable examination of benefit/
cost results; and
    (2) All parties certify that the program has been conducted in 
compliance with the agreement.
    The agreement may be terminated, prior to accomplishment of the 
computer matching purpose or 18 months from the date the agreement is 
signed (whichever comes first), by the mutual agreement of all involved 
parties within 30 days of written notice.

    Dated: March 22, 1995.
Marilynn A. Davis,
Assistant Secretary for Administration.
[FR Doc. 95-10685 Filed 5-1-95; 8:45 am]
BILLING CODE 4210-01-P