[Federal Register Volume 84, Number 50 (Thursday, March 14, 2019)]
[Notices]
[Pages 9369-9371]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-04691]
[[Page 9369]]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-6125-N-02]
Fair Market Rents for the Housing Choice Voucher Program and
Moderate Rehabilitation Single Room Occupancy Program Fiscal Year 2019;
Revised
AGENCY: Office of the Assistant Secretary for Policy Development and
Research, HUD.
ACTION: Notice of Revised Fiscal Year (FY) 2019 Fair Market Rents
(FMRs) and Discussion of Comments on FY 2019 FMRs.
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SUMMARY: This notice updates the FY 2019 FMRs for ten areas based on
new survey data: Boston-Cambridge-Quincy, MA-NH HUD Metropolitan FMR
Area (HMFA); Burlington-South Burlington, VT Metropolitan Statistical
Area (MSA), Coos County, OR; Curry County, OR; Douglas County, OR;
Oakland-Fremont, CA HMFA; Portland-Vancouver-Hillsboro, OR-WA MSA; San
Diego-Carlsbad, CA MSA; San Francisco, CA HMFA; and San Jose-Sunnyvale-
Santa Clara, CA HUD Metro FMR Area. Further, HUD responds to comments
received on the FY 2019 FMRs.
DATES: The revised FY 2019 FMRs for these 10 areas are effective on
April 15, 2019.
FOR FURTHER INFORMATION CONTACT: Questions on how to conduct FMR
surveys or concerning further methodological explanations may be
addressed to Marie L. Lihn or Peter B. Kahn, Program Parameters and
Research Division, Office of Economic Affairs, Office of Policy
Development and Research, telephone 202-402-2409. Persons with hearing
or speech impairments may access this number through TTY by calling the
toll-free Federal Relay Service at 800-877-8339 (toll-free).
Questions related to use of FMRs or voucher payment standards
should be directed to the respective local HUD program staff.
For technical information on the methodology used to develop FMRs
or a listing of all FMRs, please call the HUD USER information line at
800-245-2691 (toll-free) or access the information on the HUD USER
website: http://www.huduser.gov/portal/datasets/fmr.html. FMRs are
listed at the 40th or 50th percentile in Schedule B. For informational
purposes, 40th percentile recent-mover rents for the areas with 50th
percentile FMRs will be provided in the HUD FY 2019 FMR documentation
system at https://www.huduser.gov/portal/datasets/fmr.html#2019_query
and 50th percentile rents for all FMR areas are published at http://www.huduser.gov/portal/datasets/50per.html.
SUPPLEMENTARY INFORMATION: On August 31, 2018 HUD published the FY 2019
FMRs, requesting comments on the FY 2019 FMRs, and outlining procedures
for requesting a reevaluation of an area's FY 2019 FMRs (83 FR 44644).
This notice revises FY 2019 FMRs for 10 areas based on data provided to
HUD. Nine of these areas requested a reevaluation and one did not, but
data for reevaluation was submitted by the January 11, 2019 due date.
This notice also provides responses to the public comments HUD received
on the previous notice referenced above. Data supporting a reevaluation
request for the Akron, OH MSA were supplied to the Department by the
due date; however, there was insufficient recent mover observations to
implement the survey. The FY 2019 American Community Survey (ACS)-based
FMRs in the Akron, OH MSA become effective with this notice.
I. Revised FY 2019 FMRs
The FMRs appearing in the following table supersede the use of the
FY 2018 FMRs for the enumerated areas. The updated FY 2019 FMRs are
based on surveys conducted by the area public housing agencies (PHAs)
and reflect the estimated 40th or 50th percentile rent levels trended
to April 1, 2019.
The FMRs for the affected area are revised as follows:
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FMR by number of bedrooms in unit
2019 Fair market rent area -------------------------------------------------------------------------------
0 BR 1 BR 2 BR 3 BR 4 BR
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Boston-Cambridge-Quincy, MA-NH $1,608 $1,801 $2,194 $2,749 $2,966
HMFA...........................
Burlington-South Burlington, VT 992 1,202 1,544 2,008 2,087
MSA............................
Coos County, OR................. 538 684 837 1,210 1,394
Curry County, OR................ 629 777 979 1,416 1,574
Douglas County, OR.............. 657 773 1,023 1,479 1,796
Oakland-Fremont, CA HMFA........ 1,409 1,706 2,126 2,925 3,587
Portland-Vancouver-Hillsboro, OR- 1,131 1,234 1,441 2,084 2,531
WA MSA.........................
San Diego-Carlsbad, CA MSA*..... 1,422 1,590 2,068 2,962 3,632
San Francisco, CA HMFA.......... 2,069 2,561 3,170 4,153 4,392
San Jose-Sunnyvale-Santa Clara, 1,952 2,316 2,839 3,829 4,394
CA.............................
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* San Diego-Carlsbad, CA MSA is a 50th percentile FMR area. As part of the Small Area FMR Rulemaking (81 FR
80567), 50th percentile FMRs were abolished. FMRs for San Diego-Carlsbad, CA MSA will complete the three-year
period of use under previous regulations and revert to 40th percentile rents in FY 2020.
The FY 2019 FMRs are amended and are available on the HUD USER
website: http://www.huduser.gov/portal/datasets/fmr.html. The FY 2019
Small Area FMRs (SAFMRs) for the revised metropolitan areas have also
been updated and may be found at https://www.huduser.gov/portal/datasets/fmr/smallarea/index.html.
II. Public Comments on FY 2019 FMRs
A total of 67 comments were received and posted on regulations.gov,
https://www.regulations.gov/docketBrowser?rpp=25&so=DESC&sb=commentDueDate&po=0&D=HUD-2018-0071.
Fifty-seven of these comments were requests for reevaluation or
comments in support of requests for reevaluation of the FY 2019 FMRs in
13 FMR areas. HUD granted requests for reevaluation for 12 FMR areas,
and rejected one area's request, by community partners in Lenawee
County, MI. HUD could not approve this request because the request was
not made by the housing agency administering the voucher program in the
county. HUD discussed these requests for reevaluation in a posting
available at https://www.huduser.gov/portal/datasets/fmr.html#2019_data.
These 12 areas continued to use FY 2018 FMRs until the PHAs
provided local survey rent data, which was due no later than January
11, 2018. Due to the lapse in Federal appropriations, HUD first
assessed which areas delivered data on January 28, 2019. Ten
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of these 12 areas have continued to use FY 2018 FMRs because they
provided sufficient data. HUD published a list of the two FMR areas not
providing data on January 30, 2019 stating that the FY 2019 FMRs become
effective on January 30, 2019 (https://www.huduser.gov/portal/datasets/fmr.html#2019_data). This notice provides the reevaluated FY 2019 FMRs
for 9 of these areas plus the one area that did not request a
reevaluation but provided data by the reevaluation date of January 11,
2019 and the one area where the submitted information was unable to be
implemented.
General Comments
Most of the comments not related to specific areas requesting a
reevaluation discussed inaccuracies of the FMRs and a need for more
current and local data. These comments and their responses are
discussed in greater detail below. Before addressing specific issues,
HUD would like to remind commenters that HUD receives no geographic
information from regulations.gov for the location of the commenter.
Therefore, HUD cannot respond to or take action on comments regarding
the level of the FMR when there is no corresponding information about
the FMR area in question.
Comment: FMRs in the town of Windham, CT are going down and this
will impact Housing Choice Voucher (HCV) holders' ability to find
units.
HUD Response: While HUD wants to be responsive to comments
regarding the level of FMRs, HUD cannot reevaluate the FMRs in an area
without data more current than what was originally used to calculate
FMRs. Additionally, valid reevaluation requests must be submitted by or
supported by public housing agencies servicing at least 50 percent of
the voucher holders in the FMR area. Finally, Windham Town, CT is part
of the Windham County, CT HUD Metro FMR Area, which consists of the
following towns: Ashford town, CT; Brooklyn town, CT; Canterbury town,
CT; Chaplin town, CT; Eastford town, CT; Hampton town, CT; Killingly
town, CT; Plainfield town, CT; Pomfret town, CT; Putnam town, CT;
Scotland town, CT; Sterling town, CT; Thompson town, CT; Windham town,
CT; and Woodstock town, CT. Any data collected in support of a future
reevaluation request would need to be representative of the rental
units across the entire FMR area.
Comment: Baltimore City, MD requested a reevaluation to maintain
their FMRs at the 50th percentile.
HUD Response: 50th percentile FMRs were abolished as part of the
Small Area FMR Rulemaking (81 FR 80567) and Baltimore's three-year use
of 50th percentile FMRs ended with the FY 2018 FMRs. Public housing
agencies operating in metropolitan areas that revert to 40th percentile
FMRs from 50th percentile FMRs and where Small Area FMR are not
required have several avenues to maintain current payment standards or
maintain the use of 50th percentile rents. These options include:
1. The Housing Opportunities Through Modernization Act allows PHAs
to maintain their current payment standard amounts (regardless of their
percentage relative to the new FMRs) for in-place tenants. The Small
Area FMR rule further provides that PHAs may select a payment standard
between the current in-place payment standard down to 110 percent of
the new FMR. This is characterized as a gradual reduction in the
family's payment standard. For more information, please see PIH Notice
2018-01 (https://www.hud.gov/sites/dfiles/PIH/documents/PIH-2018-01.pdf), item (4)(e).
2. HUD's regulations at 24 CFR 982.503(f) provides a mechanism for
PHAs in this position to request approval to maintain payment standards
based on 50th percentile rents.
3. HUD's regulations at 24 CFR 982.503(e), Success Rate Payment
Standards, allows PHAs to set payment standards based on 50th
percentile rents if they qualify based on HCV holders having limited
success in finding suitable units.
4. The PHA may adopt exception payment standards of up to 110
percent of the applicable Small Area FMRs as described in 24 CFR
982.503(b)(iii).
Comment: One of the comments requesting a reevaluation of the FY
2019 FMRs in the Oakland-Freemont, CA HMFA also included several
comments regarding the use of their December 2015 rent survey, an
objection to the use of 5-year ACS data, an objection to the use of a
national trend factor, and a comment that the ``public housing cut
off'' rent is too low for one county within the metropolitan area.
HUD Response: Due to the nature of the questions posed regarding
the need to conduct a new survey within the comment, HUD has already
provided in-depth responses to the commenter; however, HUD is providing
additional commentary here for the benefit of all FMR commenters.
HUD cannot continue to use the survey conducted in the area in
December 2015 because data collected through the 2016 ACS are more
recent than the survey. This is true even though the Department
received the local survey in early 2016 and used the information to
revise the FY 2016 FMRs, and used the local survey as the basis of the
FY 2017 and FY 2018 FMR calculations. Due to the rolling nature of the
ACS, HUD has adopted the following policy concerning the longevity of
local area surveys. Surveys with an ``as-of'' date of January through
June ARE NOT considered to be more current than the same year ACS
survey since at least 50 percent of the ACS responses are newer than
the local area survey. Local area surveys with ``as-of'' dates in July
through December ARE considered to be more current than the same year
ACS since less than 50 percent of the ACS responses are more current
than the locally conducted survey.
For the purposes of uniformity and transparency, HUD's FMR
documentation systems shows the 5-year ACS data for each FMR area along
with the calculation of a recent-mover factor for each area based on
information available from the 1-year ACS data. In practice, for large
areas with statistically reliable 2-bedroom recent-mover estimates from
the 1-year ACS tabulations, the recent mover ``factor'' is an
explanation artifact for conformity in HUD's online documentation
systems . The 1-year recent mover data replaces the 5-year ACS data in
the FMR calculation. That is, the FMR for the area is based solely on
the 40th percentile 2-bedroom recent mover rent calculated from the 1-
year ACS data and this is true for the Oakland area.
HUD has addressed the issue of local trend factors in prior FMR
Federal Register notices. Beyond HUD's own research into this topic,
HUD has employed third-party researchers to assist with this important
component of the FMR calculation. Following the successful completion
of this research, should local trend factors be viable, HUD is
compelled to announce the new trend factor calculation methodology in a
notice of FMR material changes and solicit public comments on such
changes prior to implementing them. Due to the lapse in Federal
appropriations at the end of 2018, HUD is not able to commit to this
change being ready for a material change notice prior to the
calculation of the FY 2020 FMRs.
Finally, HUD reiterates that the ``public housing cut-off rent''
used to eliminate the bottom end of the distribution of rental units
from the ACS before the 40th percentile rent is calculated is a proxy
because the ACS does not collect whether or not a respondent is
receiving some form of housing assistance. HUD uses a
[[Page 9371]]
consistent method to calculate this distribution cut off for each HUD
region and sees no reason to make a change to this method at this time.
Comment: Several commenters suggested that HUD should provide
additional funding to PHAs who undertake local area surveys.
HUD Response: HUD reminds PHAs that paying for local area rent
surveys is an eligible expense to be paid from on-going administrative
fees or their administrative fee reserve account.
Comment: HUD received several comments from the Lenawee, MI
community regarding the level of their FMRs. The commenters noted that
the FMRs were too low and one commenter requested information on how
information is gathered to calculate FMRs.
HUD Response: The requests for reevaluation of the FY 2019 FMRs in
Lenawee County, MI were not accompanied by supporting statements from
PHAs representing at least 50 percent of the voucher holders in the
area and HUD was unable to grant the request. As for information on how
HUD calculates the FMRs, HUD provides comprehensive documentation on
how FMRs are calculated for each area. For FY 2019, please visit
https://www.huduser.gov/portal/datasets/fmr.html#2019_query and follow
the prompts after selecting the ``Click Here For FY 2019 FMRs'' button.
Comment: HUD should use more timely data when calculating FMRs. HUD
should request more money to reimburse surveys. HUD should continue to
refine the FMR calculation methodology.
HUD Response: There are no other data on gross rents paid that are
consistently collected on a nationwide basis, available to HUD, that
are more current than the data we receive from the ACS dataset.
Proprietary rental data cannot be used as the basis for the FMR
calculations because they are not consistently available for all areas
and frequently are not statistically representative of the rental
markets they cover. Some of these sources focus on rents for major
apartment projects only. Other sources include single family homes,
which are at least 30 percent of the rental market in major
metropolitan areas and a greater portion in rural areas, are typically
compiled from internet-based ads, or the small subset of professionally
managed single-family rental units. Online listings of rents are
similar to newspaper ads which have been excluded as a source of rent
data for FMRs since the mid-1980s due to a directive issued by HUD's
Inspector General.
As HUD has stated before, the Federal Government invests a
substantial amount of resources in collecting socio-economic data
through the ACS. Furthermore, the Census Bureau has statutory
advantages in compelling responses to the ACS and receives
significantly higher response rates than HUD could achieve if it was to
undertake its own survey program.
Comment: Annual ``erratic fluctuations'' in FMRs within the same
area do not follow established housing market dynamics and represent
serious flaws in the FMR calculation methodology.
HUD Response: HUD has implemented steps to attenuate the
fluctuations found in the annually updated survey data; however, with
the statutory directive to use the most recent data available, HUD is
compelled to update the data behind each area's FMR calculation when
new data is released. Consequently, FMRs will change from year to year
in accordance with changes in the underlying survey data. Furthermore,
the commenter provides no references to academic literature that seeks
to establish that it is impossible for rents to move both up and down
over time. HUD emphasizes that the primary data source for FMRs is a
survey (ACS) and while surveyors do their best to select unbiased
random samples of the population they wish to study, sampling error
still persists within survey statistics.
III. Environmental Impact
This Notice makes changes in FMRs for multiple FMR areas and 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: March 8, 2019.
Todd M. Richardson,
General Deputy Assistant Secretary, Office of Policy Development and
Research.
[FR Doc. 2019-04691 Filed 3-13-19; 8:45 am]
BILLING CODE 4210-67-P