[Federal Register Volume 64, Number 83 (Friday, April 30, 1999)]
[Notices]
[Pages 23344-23345]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-10733]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-4434-N-02]


Quality Housing and Work Responsibility Act of 1998; Update on 
Initial Guidance and Clarification and Technical Corrections

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

ACTION: Notice.

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SUMMARY: On February 18, 1999, HUD published a Notice of Initial 
Guidance on the Quality Housing and Work Responsibility Act of 1998. 
This new statute, part of HUD's fiscal year 1999 HUD Appropriations 
Act, embodies many of the reforms of the HUD 2020 Management Reform 
Plan that are directed at revitalizing and improving HUD's public 
housing and Section 8 assistance programs. The February 18, 1999 Notice 
advised the public of those public and assisted housing statutory 
provisions that are effective immediately and action that may or should 
be taken immediately. The February 18, 1999 Notice also provided 
guidance on certain other provisions in the FY 1999 HUD Appropriations 
Act that impact public housing programs and Section 8 assistance.
    This second Notice provides clarification and corrections for 
certain guidance provided in the February 18, 1999 Notice, and provides 
guidance on a statutory provision not addressed in the February 18, 
1999 Notice.

FOR FURTHER INFORMATION CONTACT: For further information regarding 
public housing and the Section 8 certificate, voucher and moderate 
rehabilitation programs contact Rod Solomon, Deputy Assistant Secretary 
for Policy, Program and Legislative Initiatives, Office of Public and 
Indian Housing, Department of Housing and Urban Development, 451 
Seventh Street, SW, Room 4116, Washington, DC, 20410; telephone (202) 
708-0713 (this is not a toll-free number). For further information 
regarding other Section 8 programs contact Willie Spearmon, Director, 
Office of Multifamily Business Products; telephone (202) 708-3000. 
Persons with hearing or speech impairments may access that number via 
TTY by calling the Federal Information Relay Service at (800) 877-8339. 
Program specialists for more specific HUD program areas are listed on 
the HUD web page at http://hudweb.hud.gov/offices.html.

SUPPLEMENTARY INFORMATION: The Quality Housing and Work Responsibility 
Act of 1998 (title V of the FY 1999 HUD Appropriations Act; Pub. L. 
105-276, 112 Stat. 2461, approved October 21, 1999) (QHWRA)) enacts 
landmark measures that include transforming public housing, 
deconcentrating poverty, creating additional housing assistance 
vouchers, merging the Section 8 certificate and voucher programs, and 
enabling more families to obtain FHA mortgages to become homeowners. 
Although the QHWRA makes significant and numerous amendments to the 
United States Housing Act of 1937 (USHA), the USHA remains in effect 
except as amended by the QHWRA.
    On February 18, 1999 (64 FR 8192), HUD published a Notice of 
Initial Guidance on the QHWRA. The purpose of the February 18, 1999 
Notice was to advise HUD's public housing and Section 8 program 
partners, as well as members of the public, of certain provisions of 
the QHWRA that are effective immediately and to provide guidance with 
respect to actions that may now be taken or should be taken by PHAs and 
owners of Section 8 assisted projects. The February 18, 1999 Notice, 
however, did not provide guidance on all QHWRA sections. The February 
18, 1999 Notice addressed those key statutory sections that are 
effective immediately, and which HUD believed would be helpful to PHAs 
and others to receive early guidance.
    This second Notice provides clarification on and corrections to 
certain provisions in the February 18, 1999 Notice, and provides 
guidance on a QHWRA statutory provision not addressed in the February 
18, 1999 Notice.

Section I. Corrections and Clarifications to the February 18, 1999 
Notice

Section 507--Minimum Rent for Public Housing and Section 8 Assistance

    Section 507 amends section 3(a) of the USHA which addresses minimum 
rents for public housing and section 8 assistance. In the guidance 
provided for section 507 at page 8197 (last column), HUD advised that 
as soon as practicable, the PHA must notify all families of the right 
to request a minimum rent hardship exemption under the law, and that 
determinations are subject to the grievance procedure.
    Clarification. This Notice clarifies that the notification to be 
provided to families regarding hardship exemptions (which should have 
occurred already) can be to families subject to minimum rents or 
subject to minimum rents at some time since enactment of the QHWRA, but 
not literally to ``all'' families as stated in the February 18, 1999 
Notice. Families who become subject to minimum rents also must receive 
this notification. In addition, the title ``Action Guidance for Section 
8 Certificate, Voucher and Moderate Rehabilitation Programs'' is 
revised to read: ``Action Guidance for the Section 8 Programs'' to 
correct an inadvertent error. The minimum rent guidance applicable to 
the tenant-based and moderate rehabilitation programs also applies to 
all the other Section 8 programs.

[[Page 23345]]

Section 513--Public Housing Income Targeting

    Section 513 amends section 16 of the USHA to establish, among other 
things, public housing deconcentration requirements, annual 
requirements for admitting families with incomes below thirty percent 
(30%) of area median income, and related income targeting requirements. 
The guidance for this section was provided at pages 8199 to 8200.
    In the guidance provided for Section 513, HUD noted in paragraph 
(1)(b) on page 8200 (first column) that there are three further 
limitations on a PHA's use of fungibility with respect to income 
targeting for public housing. (``Fungibility'' refers to the fact that 
to a certain extent, the PHA can credit section 8 tenant-based 
admissions above the minimum targeting requirements to satisfy its 
public housing targeting requirements.) The February 18, 1999 guidance 
provided that fungibility ``credits'' only can be used to drop the 
annual requirement for housing very poor families, as described above, 
below 40 percent of newly available units in public housing, by the 
lowest of three amounts. These three amounts were described in the 
notice at page 8200, under paragraphs designated (1)(a), (b) and (c). 
The amount provided by paragraph (1)(b) was the number of units that 
(i) are in projects located in census tracts having a poverty rate of 
30% or more, and (ii) are made available for occupancy by and actually 
occupied by very poor families.
    Correction. Paragraph (1)(b) in the first column of page 8200 
should have read as follows:

    (b) The number of public housing units that (i) are in public 
housing projects located in census tracts having a poverty rate of 
30% or more, and (ii) are made available for occupancy by, and 
actually occupied in that year by, families other than very poor 
families.

Section 514--Repeal of Federal Preferences in the Public Housing and 
Section 8 Programs

    Section 514 provides for the permanent repeal of Federal 
preferences, including the permanent repeal of the right of certain 
public housing residents to retain federal preference status on the 
Section 8 certificate and voucher waiting list; and also authorizes 
local preferences. (The elimination of the previous statutory 
preference for the admission of elderly, disabled and displaced persons 
before other single persons in the public housing and Section 8 
programs was accomplished by section 506 rather than section 514.)
    In the guidance for this section on page 8201 (first column) HUD 
advised, among other things, that because there is no indication in the 
QHWRA that Congress intended to disrupt existing local preferences, 
existing local preferences may remain without further immediate PHA 
action or may be altered in the manner authorized before enactment of 
the QHWRA.
    Clarification. HUD wishes to clarify that with respect to the 
manner in which existing local preferences were authorized to be 
altered before the enactment of QHWRA, HUD is referring to the manner 
authorized under prior HUD appropriations acts. For the purposes of 
selecting families from the waiting list, prior HUD appropriations acts 
provided that a PHA may establish, after public notice and an 
opportunity for public comment, a written system of preferences for 
selection that is not inconsistent with the comprehensive housing 
affordability strategy (consolidated plan) of either the State or local 
general government of the PHA's jurisdiction.

Section 535--Demolition, Site Revitalization, Replacement Housing, and 
Tenant-Based Assistance Grants for Public Housing Projects

    Section 535 amends section 24 of the USHA and provides the 
continued authority for the HOPE VI program, and establishes 
application selection and grant requirements.
    In the guidance for this section on page 8204 (first column), HUD 
noted the exemption from the requirements of section 18 of the USHA for 
severely distressed public housing that is demolished in accordance 
with a revitalization plan.
    Clarification. HUD wishes to clarify that where HOPE VI funds are 
awarded for demolition only, no revitalization plan is required, and 
therefore there is no exemption from the requirements of section 18 of 
the USHA.

Section II--New Guidance

Section 564--Public Housing Management Assessment Program

    Section 564 makes several amendments to section 6(j) of the USHA. 
One of these amendments excludes small PHAs (PHAs with less than 250 
units) from an independent assessment that otherwise would be required 
once a small PHA has been designated as troubled. Section 6(j)(2)(B)(i) 
limits this independent assessment to PHAs with more than 250 units.
    Action Guidance. Section 6(j)(2)(B)(i) is effective immediately

Section III--Future Guidance

    As HUD noted in the February 18, 1999 Notice, the QHWRA makes 
significant changes to HUD's public housing and Section 8 programs. 
With many of the changes immediately effective, substantial 
responsibility is placed on PHAs and Section 8 owners to implement 
these changes promptly. HUD remains committed to working closely with 
its public housing and Section 8 partners to make the changes in its 
public housing and Section 8 programs a success. HUD will continue to 
provide any additional guidance that may be needed through direct 
notices to PHAs and Section 8 owners, additional Federal Register 
notices, or through other means that may be determined appropriate.

    Dated: April 22, 1999.
Harold Lucas,
Assistant Secretary for Public and Indian Housing.
[FR Doc. 99-10733 Filed 4-29-99; 8:45 am]
BILLING CODE 4210-33-P