[Federal Register Volume 71, Number 84 (Tuesday, May 2, 2006)]
[Notices]
[Pages 25912-25913]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-4086]



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Part II





Department of Housing and Urban Development





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Public Housing Assessment System; Revision to the Financial Condition 
Scoring Process; Notice

  Federal Register / Vol. 71, No. 84 / Tuesday, May 2, 2006 / Notices  

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5066-N-01]


Public Housing Assessment System; Revision to the Financial 
Condition Scoring Process

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

ACTION: Notice.

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SUMMARY: This notice provides information to public housing agencies 
(PHAs) and members of the public about HUD's process for issuing scores 
under the Financial Condition Indicator of the Public Housing 
Assessment System (PHAS). This notice includes revised threshold values 
and associated points/scores for the expense management component of 
the Financial Condition Indicator based on available data for PHAs with 
fiscal years ending March 31, 2004, June 30, 2004, September 30, 2004, 
and December 31, 2004. The data analyzed is based on generally accepted 
accounting principles (GAAP) information submitted by PHAs as part of 
the financial data schedule submission.

DATES: Comment Due Date: June 1, 2006.

ADDRESSES: Interested persons are invited to submit comments regarding 
this rule to the Department of Housing and Urban Development, Office of 
General Counsel, Regulations Division, 451 Seventh Street, SW., Room 
10276,Washington, DC 20410-0500. Interested persons also may submit 
comments electronically through The Federal eRulemaking Portal at 
http://www.regulations.gov. Commenters should follow the instructions 
provided on that site to submit comments electronically.
    Facsimile (FAX) comments are not acceptable. In all cases, 
communications must refer to the docket number and title. All comments 
and communications submitted to HUD will be available, without change, 
for public inspection and copying between 8 a.m. and 5 p.m. weekdays at 
the above address. Due to security measures at the HUD Headquarters 
building, an advance appointment to review the public comments must be 
scheduled by calling the Regulations Division at (202) 708-3055 (this 
is not a toll-free number). Copies of comments submitted electronically 
are available for inspection and downloading at http://www.regulations.gov.

FOR FURTHER INFORMATION: Contact the Office of Public and Indian 
Housing, Real Estate Assessment Center (REAC), Attention: Wanda Funk, 
Department of Housing and Urban Development, Real Estate Assessment 
Center, 550 12th Street, SW., Suite 100, Washington, DC 20410; 
telephone the PIH-REAC Technical Assistance Center at (888) 245-4860 
(this is a toll free number). Persons with hearing or speech 
impairments may access this number through TTY by calling the toll-free 
Federal Information Relay Service at (800) 877-8339. Additional 
information is available from the PIH-REAC Internet site at http://www.hud.gov/reac/.

SUPPLEMENTARY INFORMATION:

I. Background

    HUD published the first Public Housing Assessment System; Financial 
Condition Scoring Process notice in the Federal Register on May 13, 
1999 (64 FR 26222). HUD republished the notice to coincide with the 
June 22, 1999, publication of the PHAS proposed rule. Subsequently, HUD 
revised the notice twice to reflect additional changes to the financial 
scoring process. The third notice was published on June 28, 2000 (65 FR 
40008), and the fourth notice was published on December 21, 2000 (65 FR 
80685). This notice is an update of the financial condition scoring 
process notice published on December 21, 2000. In the December 21, 
2000, notice HUD stated that any changes to the scoring process and any 
modifications to the thresholds would be communicated through a 
subsequent Federal Register notice. Accordingly, this notice updates 
the December 21, 2000, notice and provides information on the revisions 
made to the financial condition scoring process. HUD is revising the 
thresholds based on a full year's worth of unaudited and available 
audited financial information.
    This change has been made in accordance with the threshold 
revaluation schedule set forth in the December 21, 2000, notice. The 
December 21, 2000, notice stated that the thresholds established in 
that notice would remain in effect for all unaudited and audited PHA 
financial submissions for PHAs for a three year period, unless REAC 
found a need for revisions. In October 2001, July 2003, November 2004, 
and May 2005, REAC conducted an analysis of the thresholds established 
in the December 21, 2000, notice and determined not to revise the 
established thresholds. In August 2005 another analysis was conducted 
of the threshold established in the December 21, 2000, notice and it 
was determined that a revision to the expense management component was 
warranted.

II. Appendix 2, Expense Management, Revision

    The analysis of the thresholds conducted in August 2005 is based on 
the financial information submitted by PHAs with fiscal years ending 
March 31, 2004, June 30, 2004, September 30, 2004, and December 31, 
2004. As a result of this analysis, it was determined that a revision 
to the expense management thresholds was warranted, but not to the 
remaining component thresholds for current ratio, months expendable 
fund balance, tenants receivable outstanding, occupancy loss and net 
income and loss. The thresholds for the five financial condition 
components that will not be changed are included in Appendix 2, 
Thresholds for Entity-Wide GAAP Scoring, of the December 21, 2000, 
Public Housing Assessment System; Financial Condition Scoring Process. 
The table, below, includes the new thresholds for expense management.
    The revised expense management thresholds included in this notice, 
and the remaining five component thresholds included in the December 
21, 2000, financial condition notice, which are based on a full year of 
unaudited and audited financial data based on GAAP, will remain in 
effect for all unaudited and audited PHA financial submissions for PHAs 
with fiscal year end on or after September 30, 2006, for a three year 
period, unless the REAC finds a need for revisions. Any revisions to 
the thresholds will be communicated through a notice.
    The expense management table can be interpreted in the following 
manner:
     Identify a size category for expense management;
     The rows under that size category identify ranges of 
possible values for expense management; and
     The column to the right labeled ``Points/Score'' 
identifies the points/scores that is awarded to each expense management 
value for that size category.
    The thresholds presented here have been rounded for presentation 
purposes, whereas those used to calculate scores at the REAC are not 
rounded.

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                                             Expense Management (EM)
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                                                         Low medium and  high    Large and extra
              Region               Very small and small         medium                large         Points/score
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0................................  EM<$112.39..........  EM<$108.52..........  EM<$128.15.........           1.5
0................................  EM>=$112.39.........  EM>=$108.52.........  EM>=$128.15........           0
1................................  EM<$114.12..........  EM<$107.69..........  EM<$112.87.........           1.5
1................................  EM>=$114.12.........  EM>=$107.69.........  EM>=$112.87........           0
2................................  EM<$94.59...........   EM<$118.23.........  EM<$117.07.........           1.5
2................................  EM>=$94.59..........  EM>=$118.23.........  EM>=$117.07........           0
3................................  EM<$89.22...........  EM<$86.68...........  EM<$101.71.........           1.5
3................................  EM>=$89.22..........  EM>=$86.68..........  EM>=$101.71........           0
4................................  EM<$91.51...........  EM<$97.55...........  EM<$103.73.........           1.5
4................................  EM>=$91.51..........  EM>=$97.55..........  EM>=$103.73........           0
5................................  EM<$86.66...........  EM<$95.36...........  EM<$110.68.........           1.5
5................................  EM>=$86.66..........  EM>=$95.36..........  EM>=$110.68........           0
6................................  EM<$79.96...........  EM<$82.36...........  EM<$122.17.........           1.5
6................................  EM>=$79.96..........  EM>=$82.36..........  EM>=$122.17........           0
7................................  EM<$99.87...........  EM<$71.81...........  EM<$86.02..........           1.5
7................................  EM>=$99.87..........  EM>=$71.81..........  EM>=$86.02.........           0
8................................  EM<$111.02..........  EM<$133.50..........  EM<$97.86..........           1.5
8................................  EM>=$111.02.........  EM>=$133.50.........  EM>=$97.86.........           0
9................................  EM<$120.96..........  EM<$109.90..........  EM<$136.55.........           1.5
9................................  EM>=$120.96.........  EM>=$109.90.........  EM>=$136.55........           0
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    Dated: April 24, 2006.
Orlando J. Cabrera,
Assistant Secretary for Public and Indian Housing.
[FR Doc. 06-4086 Filed 5-1-06; 8:45 am]
BILLING CODE 4210-67-P