[Federal Register Volume 61, Number 140 (Friday, July 19, 1996)]
[Notices]
[Pages 37804-37806]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-18355]


      
      

[[Page 37803]]


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Part III





Department of Housing and Urban Development





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Public and Indian Housing, Rental Assistance Programs: Procedures for 
Verifying the Social Security and Supplemental Security Income of 
Applicants and Participants; Notice

  Federal Register / Vol. 61, No. 140 / Friday, July 19, 1996 / 
Notices  

[[Page 37804]]



DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-4075-N-01]


Office of the Assistant Secretary for Public and Indian Housing; 
New Procedures for Verifying the Social Security and Supplemental 
Security Income of Applicants and Participants: HUD's Rental Assistance 
Programs Administered by Public Housing Agencies and Indian Housing 
Authorities

AGENCY: Office of the Assistant Secretary for Public and Indian 
Housing, HUD.

ACTION: Notice of New Procedures for Verifying the Social Security and 
Supplemental Security Income of Applicants and Participants.

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SUMMARY: This notice informs public housing agencies and Indian housing 
authorities, collectively referenced as housing agencies (HAs), of: (1) 
new procedures to verify social security (SS) and supplemental security 
income (SSI) information for rental assistance applicants and 
participants, (2) HUD policy changes concerning SS and SSI 
verification, (3) implementation plans, and (4) actions that HAs may 
take now to help promote effective implementation of the new 
procedures. HUD published a related notice of matching program at 60 FR 
21548; May 2, 1995.

EFFECTIVE DATES: HUD plans to implement the SS and SSI computer 
matching gradually over a period of about 1 year on a State-by-State 
basis. Implementation started in June 1996 in the States of Alaska, 
Idaho, Oregon and Washington. HUD also plans to provide HAs with about 
1 month's notice of plans to implement the SS and SSI computer matching 
in the selected State(s)/HAs. Current income verification policies and 
procedures remain in effect until each HA implements the new 
procedures.

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: David L. Decker, Director, Computer 
Matching, 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, extension 
4273. (These telephone numbers are not toll-free.) A telecommunications 
device for hearing- and speech-impaired persons (TTY) is available at 
1-800-877-8339 (Federal Information Relay Services). (This is a toll-
free number.)

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

    The information collection requirements contained in this notice 
have been reviewed by the Office of Management and Budget under the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) and assigned 
approval number 2577-0083, which expires on August 31, 1997.

Background

    HAs administer the Public Housing Program and the Section 8 
Programs that provide rental assistance to low income families under 
regulations issued by HUD's Office of the Assistant Secretary for 
Public and Indian Housing. Generally, tenants pay 30 percent of their 
income for rent. Under Section 8, the difference between the market 
rent and the tenant's payment constitutes a rental subsidy. Because 
household income is the major factor in determining eligibility for, 
and the amount of, rental subsidy, HUD has required HAs to verify 
applicants' incomes at the time of initial application for assistance 
(certification) and annually thereafter (recertification). All types of 
income must be verified including, e.g., wages, SS and SSI.

Present Procedures to Verify SS and SSI

    The Social Security Administration (SSA) currently provides HAs 
with information needed to verify SS and SSI when HAs request the 
information. This is done using a mark-sense card system developed by 
the SSA. Under this system, HAs request SS and SSI information from the 
SSA by manually marking personal identifiers of tenants, i.e., the 
social security number (SSN), on a card and mailing the mark-sense card 
to a local SSA office for processing.
    The SSA then processes the mark-sense card and sends a computer-
produced report (called a Third Party Query Report) to the HA showing 
the SS and SSI benefits of the applicant or tenant. SSA has about 100 
card readers nationwide that it considers obsolete and plans to phase 
out. HAs presently are one of the primary users of SSA's mark-sense 
card operations.
    HAs generally send mark-sense cards to the SSA only for applicants 
or tenants who report SS or SSI to the HA. Instead of submitting mark-
sense cards, some HAs obtain SS and SSI information from local SSA 
offices where SSA staff use an automated system to query information by 
SSN. HAs compare the SS and SSI information obtained from the SSA to 
the tenant-reported income. HA staff include SSA documents received 
from the tenant and SSA's Third Party Query report in the tenants' case 
files.
    HUD's development in recent years of an automated database, known 
as the Multifamily Tenant Characteristics System (MTCS), facilitates 
new procedures to verify tenant-reported income data. HAs provide HUD 
with the tenant data, i.e., personal identifiers and income data, that 
is included in the MTCS. HUD issued a final rule (60 FR 11626; March 2, 
1995) requiring HAs to transfer tenant data to MTCS electronically.
    HUD also issued Notice 96-20 (HA) on April 18, 1996, informing HAs 
of a reduction in Section 8 administrative fees for failure to 
electronically submit data for Form HUD-50058, Family Report, and Form 
HUD-50058-FSS, Family Self-Sufficiency Addendum, for Section 8 
participants monthly or quarterly as required.

New Procedures to Verify SS and SSI

    Monthly HUD will transmit to SSA, via a secure high-speed data 
line, personal identifiers for tenants scheduled to recertify 3 months 
before the tenants' scheduled annual recertification date. SSA does the 
computer matching of personal identifiers and provides HUD with SS and 
SSI information which HUD compares to the tenant-reported SS and SSI 
information shown in the MTCS. At least 2 months before the tenants' 
recertification, HUD will provide HAs with SS and SSI information 
needed to do annual recertifications of tenants, i.e., to determine 
eligibility and the rental assistance amounts.
    HUD is adopting these procedures based on comments received from 
HAs that participated in a pilot project. This is a revision of what 
HUD initially planned--doing the computer matching for 
(re)certifications completed in the prior month, and reporting to HAs 
only SS and SSI information for tenants with income disparities.
    The processing and reporting timeframes cited in the prior 
paragraph approximate those currently used by many HAs for annual 
recertifications.

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However, HAs will receive the information directly from HUD--not from 
SSA. Initially, HUD will send computer-produced reports showing SS and 
SSI amounts to HAs that are similar to the reports HAs currently 
receive from SSA. HUD plans to provide for electronic transmission, 
instead of paper reports, later in calendar year 1996.
    The planned computer matching procedures as currently designed 
provide SS and SSI information on a pre-recertification basis. The 
procedures do not provide HAs with SS and SSI information on a pre-
certification basis for initial applicants for rental assistance.
    Besides providing a report similar to the SSA's Third Party Query 
Report, HUD will also provide a report that shows SS and SSI income 
disparities, and request that the HAs resolve the disparities. This 
will involve confirming data validity, evaluating the potential for 
unreported or underreported income, providing the tenant due process, 
and taking appropriate administrative or legal actions.
    HUD will provide HAs with a ``Guide for Verifying Computer Matching 
Results and Taking Enforcement Actions.'' This Guide describes the 
computer matching program, includes sample computer-produced outputs, 
and describes procedures for verifying computer matching results and 
taking enforcement actions. The Guide also provides HAs substantial 
discretion in taking enforcement actions on abuses identified. HUD will 
distribute the Guide to HAs about one month before implementation. See 
the ``Plans for Large-Scale Implementation of SS and SSI Computer 
Matching and Income Verification'' section below.

Improved Efficiency and Effectiveness of New Procedures to Verify 
SS and SSI

    A pilot demonstration has shown that the new procedures for 
verifying SS and SSI benefit HAs, HUD and SSA by improving the 
efficiency and effectiveness of income verification. Efficiency will be 
improved by using electronic data transfer and computer matching, 
instead of preparing mark-sense cards manually and sending them by mail 
to the SSA. Further, use of the new SS and SSI verification techniques 
will aid the SSA in planning for the elimination of mark-sense card 
operations and in reducing workload demands on local SSA Offices.
    The effectiveness of the income verification process will be 
improved by detecting unreported or underreported SS and SSI.
    This will be done by comparing personal identifiers of all 
household members to SSA's data. In contrast, under present procedures 
HAs verify only the SS and SSI that individuals report. HA actions on 
unreported or underreported income will help deter abuses in HUD 
programs.

Policy Change

    In implementing the new SS and SSI verification procedures, HAs 
will use HUD-provided SS and SSI computer matching results, instead of 
the SSA's mark-sense card and automated inquiry processing. The 
completeness and accuracy of the computer matching results will depend 
significantly on the quality of MTCS data that HAs provide to HUD. 
Therefore, the completeness and accuracy of the MTCS data will be of 
utmost importance.
    HUD will discontinue its requirement for pre-verification of SS and 
SSI information for new applicants. HAs will be required to request and 
use tenant-provided information on SS and SSI, that the tenants certify 
as correct. Because the new procedures will not provide for verifying 
the SS and SSI before a new applicant's certification for rental 
assistance, HAs must request that new applicants provide documents that 
tenants have in their possession showing the monthly amount of SS and 
SSI they receive. The documents may include recent benefit letters [the 
preferred document], SSA Form 1099's, award letters, other letters from 
SSA that show benefit amounts, and bank statements showing net 
payments. HAs must not request that tenants obtain documents from SSA. 
HUD expects that tenant-provided documents generally will provide 
sufficient information to determine initial eligibility and benefit 
amounts. The information will be confirmed on a post-certification 
basis with computer matching.
    HUD recognizes that pre-verification of SS and SSI information is 
beneficial in providing correct information for use in rental 
assistance determinations. However, HUD's MTCS collects data on new 
applicants after a certification or recertification occurs. Therefore, 
MTCS does not contain information needed for matching to SSA data on a 
pre-certification basis for new applicants. MTCS retains information on 
prior certifications or recertifications.
    Regarding annual recertifications, HAs may rely on the HUD-provided 
information as sufficient documentation to verify tenant-reported SS 
and SSI income. HAs should not request other documents from tenants 
concerning SS and SSI if the HA has the HUD-provided SS and SSI 
information for the applicable (re)certification period.

Plans for Large-Scale Implementation of SS and SSI Computer Matching 
and Income Verification

    HUD plans to implement the SS and SSI computer matching gradually 
over a period of about 1 year on a State-by-State basis. HUD also plans 
to provide HAs with about 1-month's notice of plans to implement the SS 
and SSI computer matching in the selected State(s)/HAs. In addition, 
HUD will provide each HA with copies of the ``Guide for Verifying 
Computer Matching Results and Taking Enforcement Actions'' at training 
sessions in selected States.
    Recognizing that some HAs have not always reported data to MTCS, 
HUD anticipates that some HAs during the next year will need to use 
present procedures to verify SS and SSI. However, HAs must only use 
those procedures when absolutely necessary, i.e., when HUD-provided 
information is not available because of incomplete MTCS reporting. 
HUD's goal is to eliminate completely HAs' use of mark-sense cards by 
September 30, 1997. Further, except for very low volume of processing 
to resolve tenant disputed SS and SSI amounts, HA requests for 
automated SS and SSI inquiries should also be eliminated by that date.
    After HAs start receiving HUD-produced computer matching results, 
HAs must discontinue the practices of submitting to the SSA mark-sense 
cards or requesting SSA automated queries of SS and SSI data. HAs 
should only be contacting SSA staff to request assistance in resolving 
SS and SSI information that the tenant disputes.

SSA Services During the Transition to Computer Matching

    When HUD, due to incomplete MTCS data, cannot provide computer-
produced SS and SSI information to HAs for recertifications, the SSA 
will provide HAs with SS and SSI verification services using past 
practices (i.e., mark sense cards or local SSA Office queries). SSA 
also will help HAs in resolving issues where the tenant disputes the 
amount of SS or SSI.

HUD Hotline

    HUD will operate a telephone Hotline during the period of the 
transition to answer HA questions concerning the implementation. The 
Hotline number is (202) 708-0099.

Actions HAs Should Take to Help Promote Effective Implementation of 
SS and SSI Computer Matching and Income Verification

    HUD encourages all HAs to take the following actions to promote 
effective

[[Page 37806]]

implementation of SS and SSI computer matching and income verification: 
(1) submit data electronically timely as required by the final rule 
published at 60 FR 11626; March 2, 1995, (2) ensure that the correct 
last name, SSN, and birth date are submitted electronically to HUD for 
all tenants required to provide SSNs, and (3) ensure that tenant-
reported SS and SSI information are entered in the appropriate data 
fields.

    Dated: July 5, 1996.
Michael B. Janis,
General Deputy Assistant Secretary for Public and Indian Housing.
[FR Doc. 96-18355 Filed 7-18-96; 8:45 am]
BILLING CODE 4210-33-P