[Federal Register Volume 78, Number 111 (Monday, June 10, 2013)]
[Notices]
[Pages 34666-34667]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-13555]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-5718-N-01]
Section 8 Housing Assistance Payments Program--Fiscal Year (FY)
2013 Inflation Factors for Public Housing Agency (PHA) Renewal Funding
AGENCY: Office of the Assistant Secretary for Policy Development and
Research, HUD.
ACTION: Notice.
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SUMMARY: The FY 2013 HUD Appropriations Act requires that HUD apply
``an inflation factor as established by the Secretary, by notice
published in the Federal Register'' to adjust FY 2013 renewal funding
for the Tenant-based Rental Assistance Program or Housing Choice
Voucher (HCV) Program of each PHA. For FY 2011 and FY 2010, renewal
funding was based on annual adjustment factors (AAFs) and HUD published
separate Renewal Funding AAFs for this purpose. These Renewal Funding
AAFs, based only on Consumer Price Index (CPI) data for rents and
utilities, were replaced for FY 2012 by inflation factors that
incorporate additional economic indices to measure the expected change
in the per unit cost (PUC) for the HCV program. The methodology for FY
2013 remains unchanged from that used in FY 2012.
DATES: Effective Date: June 10, 2013.
FOR FURTHER INFORMATION CONTACT: Michael S. Dennis, Director, Housing
Voucher Programs, Office of Public Housing and Voucher Programs, Office
of Public and Indian Housing, telephone number 202-708-1380; or Peter
B. Kahn, Director, Economic and Market Analysis Division, Office of
Policy Development and Research, telephone number 202-402-2409, for
technical information regarding the development of the schedules for
specific areas or the methods used for calculating the inflation
factors, Department of Housing and Urban Development, 451 7th Street
SW., Washington, DC 20410. Hearing- or speech-impaired persons may
contact the Federal Relay Service at 800-877-8339 (TTY). (Other than
the ``800'' TTY number, the above-listed telephone numbers are not toll
free.)
SUPPLEMENTARY INFORMATION:
I. Background
Tables showing Renewal Funding Inflation Factors will be available
electronically from the HUD data information page at: http://www.huduser.org/portal/datasets/rfif/FY2013/FY2013_IF_Table.pdf.
In prior years, the Department of Housing and Urban Development has
been using Renewal Funding AAFs based on Consumer Price Index data
published by the Bureau of Labor Statistics on ``rent of primary
residence'' and ``fuels and utilities'' as the inflation factor to
calculate the renewal funding for each PHA. During this period, HUD
undertook several projects to better understand the drivers of the
annual change in housing subsidy costs for the tenant-based voucher
program. Division F, Title VIII, Consolidated and Further Continuing
Appropriations Act, 2013 (Pub. L. 113-6, approved March 26, 2013)
requires that the HUD Secretary, for the calendar year 2013 funding
cycle, provide renewal funding for each public housing agency (PHA)
based on validated voucher management system (VMS) leasing and cost
data for the prior calendar year and by applying an inflation factor as
established by the Secretary, by notice published in the Federal
Register. This notice provides the FY 2013 inflation factors and
describes the methodology for calculating them.
II. Methodology
The Department has focused on measuring the change in average PUC
as captured in HUD's administrative data in VMS. In order to predict
the likely path of PUC over time, HUD has implemented a model that uses
several economic indices that capture key components of the economic
climate and assist in explaining the changes in PUC. These economic
components are the seasonally-adjusted unemployment rate (lagged twelve
months) and the Consumer Price Index from the Bureau of Labor
Statistics, and the ``wages and salaries'' component of personal income
from the National Income and Product Accounts from the Bureau of
Economic Analysis. This model subsequently forecasts the expected
annual change in average PUC from Calendar Year (CY) 2012 to CY 2013
for the voucher program on a national basis by incorporating comparable
economic variables from the Administration's economic assumptions. For
reference, these economic assumptions are described in the FY 2014
Budget.
The inflation factor for an individual geographic area is based on
the change in the area's Fair Market Rent (FMR) between FY 2012 and FY
2013. These changes in FMR are then scaled such that the voucher-
weighted average of all individual area inflation factors is equal to
the expected annual change in national PUC from FY 2012 to FY 2013, and
also such that no area has a negative factor. HUD subsequently applies
these calculated individual area inflation factors to eligible renewal
funding for each PHA based on VMS leasing and cost data for the prior
calendar year. For the CY 2013 PHA HCV allocation uses 0.41 percent as
the annual change in PUC. This figure was calculated by using VMS data
through December of 2012 and actual performance of economic indices
through the December of 2012.
III. The Use of Inflation Factors
The inflation factors have been developed to account for relative
differences in the PUC of vouchers so that HCV funds can be allocated
among PHAs. HUD will continue to update the current model with
available data in order to assess the expected annual change in PUC and
intends to update the methodology for future funding estimates. HUD is
also continuing to review and refine the methodology, especially for
area differences in the factors, which will be described in future
inflation factor notices.
IV. Geographic Areas
Inflation factors based on PUC forecasts are produced for all Class
A CPI cities (CPI cities with a population of 1.5 million or more) and
for the four Census Regions. They are applied to core-based statistical
areas (CBSAs), as defined by the Office of Management and Budget (OMB),
according to how much of the CBSA is covered by the CPI city-survey. If
more than 75 percent of the CBSA is covered by the CPI city-survey, the
inflation factor that is based
[[Page 34667]]
on that CPI survey is applied to the whole CBSA and to any HUD-defined
metropolitan area, called ``HUD Metro FMR Area'' (HMFA), within that
CBSA. If the CBSA is not covered by a CPI city-survey, the CBSA uses
the relevant regional CPI factor. Almost all non-metropolitan counties
use regional CPI factors. For areas assigned the Census Region CPI
factor, both metropolitan and non-metropolitan areas receive the same
factor.
The tables showing the Renewal Funding Inflation Factors available
electronically from the HUD data information page list the inflation
factors for the four Census Regions first, followed by an alphabetical
listing of each metropolitan area, beginning with Akron, OH, MSA. The
inflation factors use the same OMB metropolitan area definitions, as
revised by HUD, that are used in the FY 2013 FMRs.
V. Area Definitions
To make certain that they are referencing the correct inflation
factors, PHAs should refer to the Area Definitions Table on the
following Web page: http://www.huduser.org/portal/datasets/rfif/FY2013/FY2013_AreaDef.pdf. The Area Definitions Table lists areas in
alphabetical order by state, and the associated Census Region is shown
next to each state name. If the area where a unit is located is not
separately listed, the inflation factor for the Census Region that
includes that area is used. In the six New England states, the listings
are for counties or parts of counties as defined by towns or cities.
Any location in these states that are not specifically listed should
use the Northeast Census Region inflation factor.
Puerto Rico and the Virgin Islands use the South Region inflation
factors. All areas in Hawaii use the Renewal Funding inflation factors
listed next ``Hawaii,'' in Appendix A which is based on the CPI survey
for the Honolulu metropolitan area. The Pacific Islands use the West
Region Renewal Funding inflation factor.
VI. Environmental Impact
This notice involves a statutorily required establishment of a rate
or cost determination which does not constitute a development decision
affecting the physical condition of specific project areas or building
sites. Accordingly, under 24 CFR 50.19(c)(6), this notice is
categorically excluded from environmental review under the National
Environmental Policy Act of 1969 (42 U.S.C. 4321).
Dated: May 31, 2013.
Jean Lin Pao,
General Deputy Assistant Secretary for Policy Development and Research.
[FR Doc. 2013-13555 Filed 6-7-13; 8:45 am]
BILLING CODE 4210-67-P