[Federal Register Volume 64, Number 32 (Thursday, February 18, 1999)]
[Notices]
[Pages 8188-8189]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-3652]



[[Page 8187]]

_______________________________________________________________________

Part III





Department of Housing and Urban Development





_______________________________________________________________________



Renewal of Section 8 Tenant-Based Assistance Contracts; Notice

  Federal Register / Vol. 64, No. 32 / Thursday, February 18, 1999 / 
Notices  

[[Page 8188]]



DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-4459-N-01]


Renewal of Section 8 Tenant-Based Assistance Contracts

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

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: This Federal Register notice provides for the benefit of the 
public the contents of a HUD notice issued to public housing agencies 
(PHAs) on December 30, 1998. The December 30, 1998 notice advised PHAs 
how HUD is calculating the amount of assistance available to them to 
renew Section 8 rental and certificate and voucher contracts. A recent 
statutory provision specifies the method for HUD to use in allocating 
housing assistance available for renewal of these expiring contracts. 
The statute required HUD to implement the provision through notice not 
later than December 31, 1998, and to issue final regulations on the 
subject developed through the negotiated rulemaking process no later 
than October 21, 1999. In accordance with the statute, the notice was 
issued on December 30, 1998.

FOR FURTHER INFORMATION CONTACT: For further information contact Robert 
Dalzell, Office of Public and Indian Housing, Department of Housing and 
Urban Development, 451 Seventh Street, SW, Room 4204, Washington, DC 
20410; telephone (202) 708-1380 (this is not a toll-free number). 
Persons with hearing or speech impairments may access that number via 
TTY by calling the Federal Information Relay Service at (800) 877-8339.

SUPPLEMENTARY INFORMATION:

Background

    The statutory provision that provides the foundation for this 
notice is section 8(dd) of the United States Housing Act of 1937 (the 
Housing Act of 37) (42 U.S.C. 1437(dd)), as added by section 556(a) of 
the Quality Housing and Work Responsibility Act of 1998 (Pub. L. 105-
276, 112 Stat. 2461, approved October 21, 1998) (QHWRA). The new 
section 8(dd) directs HUD to establish an allocation baseline amount of 
assistance (budget authority) to cover the renewals, and to apply an 
inflation factor (based on local or regional factors) to the baseline. 
The new provision states as follows:

    (dd) Tenant-Based Contract Renewals.--Subject to amounts 
provided in appropriation Acts, starting in fiscal year 1999, the 
Secretary shall renew all expiring tenant-based annual contribution 
contracts under this section by applying an inflation factor based 
on local or regional factors to an allocation baseline. The 
allocation baseline shall be calculated by including, at a minimum, 
amounts sufficient to ensure continued assistance for the actual 
number of families assisted as of October 1, 1997, with appropriate 
upward adjustments for incremental assistance and additional 
families authorized subsequent to that date.

    The new statute (in section 556(b)) requires HUD to implement 
section 8(dd) through notice not later than December 31, 1998, and to 
issue final regulations on this subject that are developed through the 
negotiated rulemaking process no later than October 21, 1999.
    This notice is effective for the allocation of Federal Fiscal Year 
1999 assistance used to renew funding increments expiring between 
January 1, 1999 and December 31, 1999. HUD will develop a final rule 
implementing the requirements of Section 8(dd) through a negotiated 
rulemaking process, in accordance with the statutory requirements of 
section 556. Calendar Year 2000 funding will be allocated in accordance 
with the final rule.

Applicability

    This notice applies to renewal of all expiring rental certificate 
and voucher funding increments administered by Public Housing Agencies 
(PHAs). This notice does not apply to renewal of expiring Mod Rehab 
funding increments, to Housing Assistance Payments Contracts that are 
extended 12 months, or to Offices of Native American Programs and 
expiring Section 8 contracts administered by Tribally Designated 
Housing Entities.

Determining the Baseline

    HUD will determine the number of units leased on October 1, 1997, 
through information submitted by PHAs documenting their administrative 
fee (accompanying the Form HUD-52681, Section 8 Voucher for Payment of 
Annual Contributions and Operating Statement.) Based on this 
information, HUD will compare the number of units leased to the number 
of units reserved for the funding increments under the PHA's Annual 
Contributions Contract (ACC) on October 1, 1997.
    The number of units under ACC will be determined as follows: A 
query of HUDCAPS, the Department's automated accounting system, will 
provide the number of units under ACC as of October 1, 1997. HUD will 
add to that number, the additional authorized units as a result of 
HUD's review of leasing in excess of contract levels conducted in 
Federal Fiscal Year 1998 in accordance with letters sent to each 
affected PHA (See PIH Notice 98-22, issued April 10, 1998). In 
establishing the baseline number of units to be renewed, HUD will use 
the higher of the number of ACC units, with adjustments as noted below, 
or the number of leased units as of October 1, 1997. HUD also will add 
any additional units, placed under ACC, which were awarded to PHAs from 
funding available during Federal Fiscal Year 1998, including 
incremental funding as well as non-incremental funding such as that 
awarded to sustain assistance to families pursuant to the conversion of 
project-based assistance to tenant-based assistance. HUD also will add 
the number of tenant-based units placed under ACC as replacements for 
expiring Moderate Rehabilitation Housing Assistance Payment Contracts.

Determining Annual Cost per Unit

    HUD will determine an actual per unit cost from the last year end 
statement that it has received from each PHA by dividing the total 
annual contributions earned by the unit months leased. HUD will apply 
the FY 1999 Section 8 Housing Assistance Payments Program Contract Rent 
Annual Adjustment Factors from Table 2, published in the Federal 
Register on September 24, 1998, to inflate the per unit cost from 1998 
to 1999. If the last closed year end is before 1998, HUD will use a 
factor of 2.5 percent to inflate the per unit cost per year to 1998. 
The inflated, monthly per unit cost will be rounded and multiplied by 
12 months. In addition, HUD will add $5 per unit to fund an estimated 
increase in the administrative fee authorized in the QHWRA.

Determining the Budget Authority To Be Allocated

    The Department will multiply the number of units for each PHA that 
are expiring during Calendar Year 1999 by the cost per unit, as 
determined in accordance with the paragraph above. HUD will assign 
renewal funding sufficient to cover a 12-month term for units expiring 
within each quarter (e.g., the fund assignment for the first quarter of 
calendar year 1999 will fund all units expiring from January 1, 1999 
through March 31, 1999). In addition, the Department will fund the 
difference based on the comparison between the units under ACC, and 
leased units as of October 1, 1997, using the established per unit 
cost.

Renewal Funding Available

    The budget authority that will be allocated is subject to the 
availability of

[[Page 8189]]

appropriations. HUD anticipates that sufficient funding is available to 
fully fund each PHA in accordance with this notice.

Catalog

    The Catalog of Federal Domestic Assistance numbers for the programs 
affected by this notice are 14.855 and 14.857.

    Authority: 42 U.S.C. 1437f(dd).

    Dated: February 9, 1999.
Deborah Vincent,
General Deputy Assistant, Secretary for Public and Indian Housing.
[FR Doc. 99-3652 Filed 2-17-99; 8:45 am]
BILLING CODE 4210-33-P