CARH’S BROADCAST E-MAIL – Regulatory Update

August 26, 2016

HUD published a Notice in today’s Federal Register on the Fair Market Rents (FMRs) for the Housing Choice Voucher Program and the Moderate Rehabilitation Single Room Occupancy Program and Other Programs for Fiscal Year 2017.

The Housing Opportunities Through Modernization Act of 2016 (HOTMA) revised the procedure by which HUD publishes its annual FMRs. Specifically, HUD is no longer required to publish proposed FMRs for comment in the Federal Register. Instead, HUD may post the FMRs on HUD’s website and announce such posting by notice published in the Federal Register. In addition, HOTMA provides that HUD’s FMRs shall be effective no earlier than 30 days after the date of the publication of HUD’s Federal Register notice.  However, public housing agencies (PHAs) and other interested parties may comment on the FMR and request re-evaluation of FMRs in a jurisdiction before such FMRs become effective. Consequently, any comments are due by September 26, 2016, and the effective date of the FMRs is October 1, 2016.

HOTMA also requires HUD to publish proposed material changes to the methodology for comment. Today’s notice does not change the methodology for calculating the FY 2017 FMRs estimates from that used to determine the FY 2016 FMRs. However, the notice requests public comments on defining the scope of material changes that will trigger notice and comment in future calculation of FMRs.

These FMRs are used for several purposes. Specifically, the FMRs in this Notice are used to determine:  (i) the payment standard amounts for the Housing Choice Voucher program; (ii) initial renewal rents for some expiring project-based Section 8 contracts; (iii) initial rents for housing assistance payment contracts in the Moderate Rehabilitation Single Room Occupancy program; and (iv) to serve as a rent ceiling in the HOME program. FMRs are also used in calculating flat rents in Public Housing units.

The notice contains an explanation of the methodology for the FMRs. This explanation includes mention of Small Area FMRs (SAFMRs) and alternatives to the 50^th percentile FMRs. On August 15, 2016, CARH joined with other industry groups in a letter to HUD outlining concerns with current methodology for determining and using SAFMRs.

The CARH national office and coalition of industry groups will be reviewing the Notice and submitting comments to HUD if necessary. If CARH members have any comments and concerns with the FMRs, please email them to carh@carh.org by Monday, September 19, 2016.

If you have any questions, please contact the CARH national office at carh@carh.org or 703-837-9001.