[Federal Register Volume 66, Number 212 (Thursday, November 1, 2001)]
[Notices]
[Pages 55524-55527]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-27415]



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Part IV





Department of Housing and Urban Development





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Housing Choice Voucher Program: Funding Availability for Reallocated 
Baseline Units and Annual Budget Authority and for Relocated Baseline 
Welfare to Work Units and Annual Budget Authority; Notice

  Federal Register / Vol. 66, No. 212 / Thursday, November 1, 2001 / 
Notices  

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-4694-N-01]


Housing Choice Voucher Program: Notice of Funding Availability 
for Reallocated Baseline Units and Annual Budget Authority and for 
Reallocated Baseline Welfare to Work Units and Annual Budget Authority

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

ACTION: Notice.

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SUMMARY: This notice announces HUD procedures for reallocating baseline 
units and annual budget authority in the housing choice voucher 
program. The notice outlines public housing agency (PHA) eligibility 
criteria to apply for reallocated units and budget authority, and the 
semiannual invitation and application procedures. This notice also 
announces HUD procedures for reallocating baseline Welfare to Work 
units and annual budget authority. The procedures applying to Welfare 
to Work vouchers are discussed in section III of this notice since the 
reallocation process and timetable will be separate from the process 
for other housing choice vouchers.

FOR FURTHER INFORMATION CONTACT: Deborah Hernandez, Section 8 Finance 
Division, Office of Administration and Budget, Office of Public and 
Indian Housing, Department of Housing and Urban Development, 451 
Seventh Street, SW., Room 4232, Washington, DC 20410; telephone (202) 
708-2934. For further information regarding reallocation of Welfare to 
Work vouchers, contact Kathryn Greenspan, Office of Public and Assisted 
Housing Delivery, Department of Housing and Urban Development, 451 
Seventh Street, SW., Room 4222, Washington, DC 20410; telephone (202) 
708-0744. (These are not toll-free numbers.) Persons with hearing or 
speech impairments may access these numbers via TTY by calling the 
toll-free Federal Information Relay Service at (800) 877-8339.

SUPPLEMENTARY INFORMATION:

I. Overview

A. Background

    On October 21, 1999, following a negotiated rulemaking, HUD 
published a final rule (64 FR 56882) creating a new 24 CFR 982.102, 
which establishes the procedures to determine baseline unit 
allocations, for which HUD obligated and renews funding, for the 
Section 8 voucher program. The rule provides (Sec. 982.102(i)) that if 
a PHA has performance deficiencies, such as failure to adequately lease 
units, HUD may reallocate some of its budget authority to other PHAs. 
The rule provides that HUD will publish a Federal Register notice that 
describes the circumstances and procedure for reallocating budget 
authority.
    On April 19, 2000, HUD published a Federal Register notice (65 FR 
21088) pursuant to the final rule, which advises PHAs to ensure that 
they assist the number of families that equals the number of units 
reserved for the PHA, and to manage their lease-up and turnover to 
fully use annual budget authority.
    The April 19, 2000 Federal Register notice also states that HUD 
will annually assess each PHA's leasing rate and use of annual budget 
authority to determine whether to reallocate unused baseline units and 
unexpended annual budget authority to other PHAs. The notice further 
states that HUD will issue a Federal Register notice outlining the 
criteria for determining the PHAs to receive reallocated annual budget 
authority. Section II of this notice announces the procedures for 
regular semiannual reallocation of voucher baseline units (other than 
Welfare to Work units) and annual budget authority. In addition, 
section III of this notice announces separate procedures for 
reallocating baseline Welfare to Work units and annual budget 
authority.

B. Environmental Review

    This NOFA does not direct, provide for assistance or loan and 
mortgage insurance for, or otherwise govern or regulate, real property 
acquisition, disposition, leasing (other than tenant-based rental 
assistance), rehabilitation, alteration, demolition, or new 
construction, or establish, revise, or provide for standards for 
construction or construction materials, manufactured housing, or 
occupancy. Accordingly, under 24 CFR 50.19 (c) (1), this NOFA is 
categorically excluded from environmental review under the National 
Environmental Policy Act of 1969 (42 U.S.C. 4321).

II. Baseline Units and Annual Budget Authority Available for 
Reallocation

A. Determining the Number Units Available for Reallocation

    The April 19, 2000 Federal Register notice specifies when tenant-
based baseline unit allocations become available for reallocation to 
other PHAs. The notice states that when HUD processes a PHA's year-end 
statement, it will assess the PHA's leasing rate and rate of use of 
annual budget authority. If the leasing rate is less than 90 percent of 
the number of units reserved and the PHA has expended less than 90 
percent of its annual budget authority, HUD will issue a warning to the 
PHA. If the PHA fails to increase its leasing rate to 95 percent of the 
number of units reserved by the time the PHA submits its second budget 
after the warning, then the unused baseline units and unexpended 
baseline annual budget authority is subject to reallocation.
    In addition, unused baseline units and unexpended annual budget 
authority become available for reallocation when a PHA voluntarily 
decides to decrease its program size. A number of factors may cause a 
PHA to decide to no longer administer its full baseline unit allocation 
including a locally strong and tight private rental market, inadequate 
suitable rental stock, or insufficient voucher applicants, among other 
reasons. If a PHA voluntarily chooses to decrease its baseline unit 
allocation, those baseline units and the related annual budget 
authority become available for reallocation.
    Baseline units and annual budget authority may also become 
available for reallocation in other ways, including but not limited to 
a HUD-directed mandatory reduction in voucher program size as a result 
of poor PHA performance under the Section 8 Management Assessment 
Program, or PHA failure to comply with the ACC. When baseline units 
become available for reallocation, the Department will reduce the 
number of baseline units for the PHA that is relinquishing the units by 
not renewing funding for them under the PHA's consolidated annual 
contributions contract (CACC).

B. Inapplicability to Voluntary Transfers of Program Administration 
within the Same Geographic Area

    This notice does not apply to the voluntary transfer of baseline 
units and annual budget authority, from one PHA's CACC to another PHA's 
CACC, when the transfer is between PHAs within the same metropolitan 
area, within the same nonmetropolitan county, or within the same state 
where voucher program administration is voluntarily shifted from a city 
or county PHA to its state PHA, or from a state PHA to one or more of 
its county or city PHAs.

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C. Semiannual Invitation to Apply for Reallocated Baseline Units and 
Annual Budget Authority

    The HUD Office of Public and Indian Housing will post an invitation 
for PHAs to apply for reallocated housing choice voucher baseline units 
and annual budget authority during the first work week of each calendar 
semiannual period beginning in January 2002.
    The invitation will be posted on the Internet, on the Office of 
Public and Indian Housing housing choice vouchers web page at: http://www.hud.gov/offices/pih/programs/hcv. The invitation will announce the 
availability of the total number of baseline units, the related annual 
budget authority, and the per unit annual budget authority amount, that 
became available to HUD for reallocation during the preceding 
semiannual period. The per unit annual budget authority amount for the 
reallocated baseline units made available under each semiannual 
invitation will be the average per unit annual budget authority amount 
for all of the units made available for reallocation and announced 
under that invitation.
    If HUD determines there are insufficient baseline units and annual 
budget authority available for reallocation in any semiannual period 
and so an invitation is not warranted for that semiannual period, a 
notice will be posted to that effect on the Internet housing choice 
voucher page during the first workweek of the semiannual period.

D. Eligible Applicants and Application Procedures

    (1) Eligible Applicants. Reallocated housing choice voucher 
baseline units and annual budget authority are available for only two 
groups of PHAs:
    (a) PHAs that have urgent needs due to housing loss and permanent 
displacement arising from federally declared disasters and that have a 
leasing rate, or rate of use of annual budget authority, of at least 90 
percent, and
    (b) PHAs that have a leasing rate, or rate of use of annual budget 
authority, of at least 97 percent. The leasing rate and rate of use of 
budget authority are measured using data from the PHA's last submitted 
year end statement in accordance with the methodology in the April 19, 
2000 Federal Register notice, as amended by notice published on 
September 28, 2001.
    (2) Ineligible Applicants. Any otherwise eligible applicant under 
paragraph (1)(b) is ineligible for reallocated baseline units and 
annual budget authority if the PHA is rated troubled under the Section 
8 Management Assessment Program (SEMAP) once all PHAs have been rated 
or if the PHA is rated troubled under the Section 8 Management 
Assessment Program (SEMAP once all PHAS have been rated or if the PHA 
(a) has been charged with a systemic violation of the Fair Housing Act 
by the Secretary alleging ongoing discrimination; (b) is a defendant in 
a Fair Housing Act lawsuit filed by the Department of Justice alleging 
an ongoing pattern or practice of discrimination; or (c) has received a 
letter of noncompliance findings under Title VI, section 504, or 
section 109.
    The Department will not accept or process an application under its 
semiannual invitations to apply for reallocated baseline units if any 
such fair housing charge, lawsuit, or letter of findings has not been 
resolved to the satisfaction of the Department before the application 
due date. The Department's decision regarding whether a fair housing 
charge, lawsuit, or letter of findings has been satisfactorily resolved 
will be based upon whether HUD determines that appropriate actions have 
been taken to address allegations of ongoing discrimination in the 
policies or practices involved in the charge, lawsuit or letter of 
findings.
    (3) Application Procedures. (a) Maximum and Minimum Voucher 
Request. An eligible PHA may apply for the number of vouchers (baseline 
units) available for reallocation under the semiannual invitation, not 
to exceed a maximum of 5 percent of its baseline units, or 25 units, 
whichever is greater. The minimum number of vouchers that a PHA may 
apply for is 25. These limits do not apply to applications for vouchers 
for urgent housing needs arising from federally declared disasters.
    (b) Application Submission and Due Date. Each January and July, 
after the invitation to apply for reallocated baseline units is posted 
on the Internet, an eligible PHA may submit an application to HUD 
Headquarters for the available units, up to the maximum voucher 
request. Eligible PHAs that have urgent housing needs arising from 
federally declared disasters may submit an application for any 
available reallocated baseline units and annual budget authority at any 
time. Urgent housing needs are defined as housing loss and permanent 
displacement and PHAs need not wait for the semiannual invitation to be 
posted.
    (c) Application Form. The application form to be used is form HUD-
52515 (section C, Average Monthly Adjusted Income, is not required). A 
PHA that applies for vouchers in connection with a federally declared 
disaster must also submit an application transmittal letter fully 
explaining the urgent need for the requested vouchers, including the 
extent of permanent housing loss by very low income families.
    (d) Non-disaster Application Deadline. All non-disaster 
applications in response to the semiannual invitations are due no later 
than 5 p.m. Eastern time on the 1st of February or August. If the 1st 
falls on a weekend, applications are due by 5 p.m. on the following 
Monday. Mailed applications must be postmarked by the due date and must 
be received within 10 days of the due date.
    (e) Non-disaster Application Not Funded or Not Fully Funded. If for 
any reason a non-disaster application is not funded, or is not fully 
funded, it will not be automatically considered under the next 
semiannual invitation. A non-disaster application must be submitted in 
response to a specific semiannual invitation to be considered for 
vouchers (baseline units) announced in that invitation.

E. Selection and Funding Procedure

    (1) Applications for Disasters. HUD Headquarters will review 
applications to address urgent needs due to housing loss and permanent 
displacement arising from federally declared disasters upon receipt. If 
HUD determines the need for vouchers is adequately demonstrated and 
that the PHA meets the required leasing rate or rate of utilization of 
annual budget authority of at least 90 percent, these applications will 
generally be immediately approved and funded on a first-come, first-
served basis, up to the amount of baseline units and annual budget 
authority available for reallocation.
    (2) Non-disaster applications from PHAs with at least 97 percent 
utilization. (a) Same-State funding priority. Highest funding priority 
for baseline units available for reallocation in each State will be 
given to applicant PHAs in the same State. Upon receipt of all non-
disaster applications in a semiannual period, HUD will examine the 
applicant PHAs to determine whether any applicant PHA has jurisdiction 
in the same state as a PHA from which units available for reallocation 
in the semiannual period were de-reserved. Applicants from the same 
state as a PHA from which units available for reallocation were de-
reserved, will be given highest priority for the number of units made 
available from a PHA in the same state, up to the number of units 
requested by the applicant PHA. Any applicants given such priority in 
selection for funding

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will generally be funded at the end of the third month of the 
semiannual period (March or September).
    (b) Priority for SEMAP high performers. After priority is given to 
applicant PHAs in the same State as a PHA from which units available 
for reallocation were obtained, the next priority for funding will be 
given to applicant PHAs that are SEMAP high performers once all PHAs 
have been rated under SEMAP. HUD will examine the applicant PHAs to 
determine whether any applicant PHA is a SEMAP high performer. SEMAP 
high performers will be given the next priority for funding up to the 
number of units requested by the applicant PHA. Any applicants given 
such priority in selection for funding will generally be funded at the 
end of the third month of the semiannual period (March or September).
    (c) Remaining applications. All remaining applications will 
generally be funded at the end of the third month of the semiannual 
period (March or September) by allocating the remaining number of 
baseline units available among all of the remaining semiannual 
applicants on an even percentage basis in proportion to the number of 
units requested or remaining to be funded in each PHA's application. 
PHA applications will not be reduced below 25 units. Consequently, a 
PHA's request for a certain number of units may be fully approved or 
partially approved.
    (d) Possibility of Selection of Applicants by Lottery. In the event 
HUD determines that there are too many applicants from the same state 
(in giving same-state funding priority) from SEMAP high performers (in 
giving priority to high performers), or among remaining applications in 
any semiannual period to award each applicant the minimum of 25 
vouchers, applicants will be selected by lottery. The number of 
baseline units and annual budget authority for which same-State 
priority is being given, for which SEMAP high performer priority is 
being given, or remaining available under the invitation will then be 
allocated among the PHAs selected in the lottery on an even percentage 
basis in proportion to the number of units requested in each PHA's 
application.
    (e) No Applications or Insufficient Applications. If there are no 
applications or insufficient applications in response to any semiannual 
invitation, the unused reallocated baseline units and related annual 
budget authority announced in the semiannual invitation will be 
included in the next semiannual invitation.

F. Summary of Semiannual Baseline Unit and Budget Authority 
Reallocations

    A summary of each semiannual period's baseline unit reallocations, 
including lists of PHAs from which and to which units and annual budget 
authority were reallocated, will be posted on the Internet at the same 
site as the semiannual invitations: http://www.hud.gov/offices/pih/programs/hcv. Funding decisions will also be published in the Federal 
Register.

III. Welfare-to-Work Voucher Baseline Units and Annual Budget 
Authority

    Baseline Welfare to Work voucher units and annual budget authority 
will be permanently de-reserved and become available for reallocation 
in a process and on a timetable that is separate from the process for 
other housing choice vouchers. The Department will determine each PHA's 
Welfare to Work voucher leasing rate no earlier than 30 days after the 
publication of this notice. Welfare to Work voucher funding of PHAs 
that have not achieved leasing of their Welfare to Work vouchers of at 
least 95 percent by that date will be subject to de-reservation and 
reallocation without additional warnings or cure periods prior to de-
reservation.
    In the future, if PHAs that receive additional Welfare to Work 
vouchers have not reached a Welfare to Work voucher leasing rate of at 
least 95 percent by the expiration date of the Welfare to Work voucher 
increment, unused Welfare to Work voucher funding will be subject to 
de-reservation at the expiration date of the Welfare to Work voucher 
increment.
    When baseline Welfare to Work voucher units become available for 
reallocation, the Department will reduce the number of baseline Welfare 
to Work voucher units for the PHA that is relinquishing the units by 
not renewing funding for them under the PHA's consolidated annual 
contributions contract (CACC).

A. Invitation To Apply for Reallocated Baseline Welfare to Work Voucher 
Units and Annual Budget Authority

    When baseline Welfare to Work voucher units and annual budget 
authority become available, the Office of Public and Indian Housing 
will post an invitation for Welfare to Work voucher PHAs to apply for 
reallocated baseline Welfare to Work voucher units and annual budget 
authority. The invitation will be posted on the Internet, on the Office 
of Public and Indian Housing Welfare to Work voucher page at: 
http://www.hud.gov/pih/programs/ph/wtw. The invitation will announce 
the total number of baseline Welfare to Work voucher units available, 
the budget authority to be reallocated, and the per unit annual budget 
authority amount. The per unit annual budget authority amount for the 
reallocated baseline units made available under an invitation will be 
the average per unit annual budget authority amount for all of the 
units made available for reallocation and announced under that 
invitation.

B. Eligible Applicants and Application Procedures for Welfare to Work 
Voucher Funding

    (1) Eligible Applicants. Reallocated Welfare to Work voucher 
baseline units and annual budget authority are available only to 
Welfare to Work voucher PHAs that have a Welfare to Work voucher 
program leasing rate of at least 97 percent.
    (2) Ineligible Applicants. Any otherwise eligible applicant under 
paragraph (1) is ineligible for reallocated Welfare to Work baseline 
units and annual budget authority if the PHA is rated troubled under 
the Section 8 Management Assessment Program (SEMAP) once all PHAs have 
been rated or if the PHA (a) has been charged with a systemic violation 
of the Fair Housing Act by the Secretary alleging ongoing 
discrimination; (b) is a defendant in a Fair Housing Act lawsuit filed 
by the Department of Justice alleging an ongoing pattern or practice of 
discrimination; or (c) has received a letter of noncompliance findings 
under Title VI, section 504, or section 109. The Department will not 
accept or process an application under any invitation to apply for 
reallocated Welfare to Work baseline units if any charge, lawsuit, or 
letter of findings has not been resolved to the satisfaction of the 
Department before the application due date. The Department's decision 
regarding whether a charge, lawsuit, or a letter of findings has been 
satisfactorily resolved will be based upon whether appropriate actions 
have been taken to address allegations of ongoing discrimination in the 
policies or practices involved in the charge, lawsuit or letter of 
findings.
    (3) Application Procedures. (a) Maximum and Minimum Voucher 
Request. An eligible PHA may apply for the number of Welfare to Work 
vouchers (baseline Welfare to Work voucher units) available for 
reallocation under the invitation, not to exceed the number of units 
which the PHA expects to lease within 12 months of the award of new 
funding, based on experience with the Welfare to Work voucher program.

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There is no minimum number of vouchers for which the PHA must apply.
    (b) Application Submission and Due Date. After the invitation to 
apply for reallocated baseline Welfare to Work voucher units is posted 
on the Internet, an eligible PHA may submit an application to HUD 
Headquarters. The invitation will specify the place where applications 
are to be submitted and the due date.
    (c) Application Form. The application form to be used is form HUD-
52515 (section C, Average Monthly Adjusted Income, is not required).

C. Selection and Funding Procedures for Welfare to Work Vouchers

    (1) All applications from Welfare to Work voucher PHAs with at 
least 97 percent utilization will generally be funded on an objective 
basis such as by allocating the number of baseline Welfare to Work 
voucher units available among all of the eligible applicants on a 
percentage basis in proportion to the size of their initial Welfare to 
Work voucher allocation.
    (2) In the event that HUD determines that there are too many 
applicants to award each applicant the number of Welfare to Work 
vouchers for which they have applied and are eligible, applicants will 
be selected by lottery. The number of baseline Welfare to Work voucher 
units and annual budget authority available under the invitation will 
then be allocated among the Welfare to Work voucher PHAs selected in 
the lottery on an equitable basis such as on a percentage basis in 
proportion to the number of Welfare to Work voucher units in each PHA's 
initial Welfare to Work voucher allocation.
    (3) If there are no applications or insufficient applications in 
response to an invitation, the unused reallocated baseline Welfare to 
Work voucher units and related annual budget authority announced in the 
invitation will be included in the next invitation.

    Dated: October 25, 2001.
Michael Liu,
Assistant Secretary for Public and Indian Housing.
[FR Doc. 01-27415 Filed 10-31-01; 8:45 am]
BILLING CODE 4210-33-P