Notice of Intent To Change HUD-Wide the Operating Model of the Office of Multifamily Housing, 25293-25295 [2013-10057]
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Federal Register / Vol. 78, No. 83 / Tuesday, April 30, 2013 / Notices
Name/Address of applicant
Category
ICF Incorporated, LLC, 9300 Lee Highway, Fairfax, VA
22031–1207, (425) 747–6963.
FirstPic, 2614 Chapel Lake Drive, Gambrills, MD 21054–
1637, (202) 393–6400.
Econometrica, 4416 East West Highway, Suite 215, Bethesda, MD 20814–4572, (240) 333–4807.
National Congress of American Indians, 1516 P Street NW.,
Washington, DC 20005–1910, (202) 466–7767.
Red Lake Reservation Housing Authority, 23884 Highway 1
East, Red Lake, MN 56671–0219, (218) 679–3368.
Pacific American Foundation, 146 Hekili Street, #203, Kailua,
HI 96734–2873, (808) 263–0083.
National or regional organization representing Native American housing interest and for-profit entities.
National or regional organization representing Native American housing interest and for-profit entities.
National or regional organization representing Native American housing interest and for-profit entities.
National or regional organization representing Native American housing interest and for-profit entities.
National or regional organization representing Native American housing interest and for-profit entities.
National or regional nonprofit organizations, or for-profit entities equipped to provide Training & Technical Assistance
to DHHL and sub-recipients of NHHBG.
[FR Doc. 2013–10052 Filed 4–29–13; 8:45 am]
BILLING CODE 4210–67–P
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
[Docket No. FR–5714–N–01]
Notice of Intent To Change HUD-Wide
the Operating Model of the Office of
Multifamily Housing
Office of the Assistant
Secretary for Housing—Federal Housing
Commissioner, HUD.
ACTION: Notice.
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AGENCY:
SUMMARY: This notice advises the public
that HUD’s Office of Multifamily
Housing intends to make changes to its
field and Headquarters operating model.
Specifically, the Office of Multifamily
Housing will streamline its
organizational structure by
consolidating 6 Headquarters business
offices into 4 offices and consolidating
its field structure of 17 Hubs to 5 Hub
offices and 5 satellite offices reporting to
the Hubs. The other 7 Hubs and 34
program centers will be consolidated
into the remaining 10 offices (5 Hubs
and 5 satellite offices). The 2 existing
property disposition centers will be
consolidated into one. Affected offices
that will be consolidated include:
Hartford CT, Manchester NH,
Providence RI, Newark NJ, Buffalo NY,
Philadelphia PA, Washington DC (field
office only), Baltimore MD, Pittsburgh
PA, Richmond VA, Charleston WV,
Birmingham AL, Miami FL, Louisville
KY, Jackson MS, Greensboro NC, San
Juan PR, Columbia SC, Knoxville TN,
Nashville TN, Indianapolis IN,
Minneapolis MN, Cleveland OH,
Milwaukee WI, Little Rock AK, New
Orleans LA, Albuquerque NM,
Oklahoma City OK, Houston TX, San
Antonio TX, Des Moines IA, St. Louis
MO, Omaha NE, Phoenix AZ, Los
Angeles CA, Honolulu HI, Las Vegas
NV, Anchorage AK, and Portland OR.
The Seattle WA office will remain open
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13:22 Apr 29, 2013
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however; Office of Multifamily Housing
employees will be transferred into like
positions and provide support to the
Office of Healthcare Programs. HUD
provides this notice in accordance with
section 7(p) of the Department of
Housing and Urban Development Act.
FOR FURTHER INFORMATION CONTACT:
Joseph Dubose, Office of Housing,
Department of Housing and Urban
Development, 451 7th Street SW., Room
6138, Washington, DC 20410;
Joseph.Dubose@hud.gov, telephone
(202) 402–6886; TTY number for the
hearing- and speech-impaired (202)
708–2565 (these telephone numbers are
not toll-free).
SUPPLEMENTARY INFORMATION: In
accordance section 7(p) of the
Department of Housing and Urban
Development Act (42 U.S.C. 3535(p)), a
plan for the reorganization of any HUD
regional, area, insuring, or other field
office may take effect only upon the
expiration of 90 days after publication
in the Federal Register of a cost-benefit
analysis of the effects of the plan on
each HUD office involved. Such costbenefit analysis shall include, but not be
limited to (1) an estimate of cost savings
supported by background information
detailing the source and substantiating
the amount of the savings; (2) an
estimate of the additional cost which
will result from the reorganization; (3) a
study of the impact on the local
economy; and (4) an estimate of the
effect of the reorganization on the
availability, accessibility, and quality of
services provided for recipients of those
services. Where any of the factors
cannot be quantified, the HUD shall
provide a statement on the nature and
extent of those factors in the cost-benefit
analysis.
Cost Benefit Analysis
A. Background
In order to most effectively use its
human capital and other resources, the
Office of Multifamily Housing (MFH)
has been actively working to make
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25293
Amount funded
1,000,000.00
1,000,000.00
1,000,000.00
750,000.00
400,000.00
350,000.00
fundamental changes to its operating
model to improve effectiveness and
efficiency and to maximize
opportunities to reshape and realign its
workforce. Important progress has been
made to date, including improving
productivity, reducing loan cycle times,
increasing employee engagement, and
introducing a more risk-based approach
to asset management activities.
However, several fundamental
challenges remain, including a
fragmented and unwieldy organizational
structure antiquated systems and
processes, and role specification which
allows for little flexibility in allowing
employees to perform various roles
while responding to spikes and ebbs in
workload.
MFH proposes implementation of 3
categories of changes that will
significantly improve the delivery
model, help better manage risk and lead
to an annual cost savings of an
estimated $47M upon complete
implementation. These changes include
the following:
(1) Streamline the organizational
structure;
(2) Introduce risk-based processing
across MFH and launch greater
workload sharing and balancing;
(3) Create new roles and abolish
outdated or under-utilized positions.
The goal is to fully implement these
changes by the end of fiscal year (FY)
2016. The reorganization is expected to
enhance operational efficiency, as well
as improve the service provided to
HUD’s customers.
B. Description of Proposed Changes
Under the proposed structure,
Headquarters’ business units will be
consolidated and reduced from 6
separate offices to 4. In the field, MFH
will consolidate 17 Hubs to 5 Hub
offices and 5 satellite offices reporting to
the Hubs. The other 7 Hubs and 34
program centers will be consolidated
into the remaining 10 offices (5 Hub
offices and 5 satellite offices). The 2
existing property disposition centers
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25294
Federal Register / Vol. 78, No. 83 / Tuesday, April 30, 2013 / Notices
will be consolidated into one. Affected
offices that will be consolidated
include: Hartford CT, Manchester NH,
Providence RI, Newark NJ, Buffalo NY,
Philadelphia PA, Washington DC (field
office only), Baltimore MD, Pittsburgh
PA, Richmond VA, Charleston WV,
Birmingham AL, Miami FL, Louisville
KY, Jackson MS, Greensboro NC, San
Juan PR, Columbia SC, Knoxville TN,
Nashville TN, Indianapolis IN,
Minneapolis MN, Cleveland OH,
Milwaukee WI, Little Rock AK, New
Orleans LA, Albuquerque NM,
Oklahoma City OK, Houston TX, San
Antonio TX, Des Moines IA, St. Louis
MO, Omaha NE, Phoenix AZ, Los
Angeles CA, Honolulu HI, Las Vegas
NV, Anchorage AK, and Portland OR.
The Seattle WA office will remain open
however; MFH employees will be
transferred into like positions in that
office to support the Office of
Healthcare Programs. The 5 remaining
Hubs will be in Atlanta GA, New York
NY, Chicago IL, Fort Worth TX, and San
Francisco CA. The satellite offices will
be in Denver CO, Kansas City MO,
Jacksonville FL, Detroit MI and Boston
MA.
This new model will help establish
better spans of control and establish
clear reporting lines in the field. The
new structure will allow for more active
workload balancing which will enable
MFH to provide more consistent
servicing to its customers which will
ultimately enhance the level of
customer service received. Employees in
affected offices will have the option to
either take a buyout or continue their
HUD careers in one of the 10 remaining
locations via directed reassignments
with relocation entitlements.
To ensure that effective program
delivery is maintained for all customers,
MFH will introduce risk-based
processing and workload sharing and
will create new roles and abolish
outdated or under-utilized positions. To
increase processing consistency and
enhance efficiency, workload will be
spread virtually across the remaining
Hubs based on utilization. This will
result in increased efficiency gains in
both Asset Management and Asset
Development, and help to maintain
level work across the remaining hubs.
More importantly, reducing the field
footprint will increase the consistency
of MFH processing across the country
and provide a standard platform to
introduce ongoing enhancements and
efficiencies.
MFH will segment its lenders and
loans by key risk factors, spending less
time on low-risk applications to ensure
sufficient focus can be placed on the
more high-risk ones. This will improve
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13:22 Apr 29, 2013
Jkt 229001
processing time and allow MFH to
better manage risk within the
organization. Additionally, MFH assets
will be segmented by troubled and nontroubled, which will provide the ability
to designate specific staff to focus on
more complex-time-consuming work.
Additionally, MFH currently has
defined roles and positions that are
outdated and poorly designed in
relationship to specification. Roles are
overspecialized in the Asset
Development arena while they are
under specialized in Asset Management.
This creates bottlenecks in processing
(not enough of a particular role to meet
workload demands or processing
breakdowns when key players are
absent). Overspecialization reduces the
ability of employees to perform various
functions as workload demand ebbs and
peaks. Under specialization oftentimes
reduces the ability to effectively manage
risk.
Under the new operating model, MFH
will create two new models, an
Underwriter position to support Asset
Development and an Account Executive
model for Asset Management. The
creation of these models will improve
efficiency and help to better manage
risk. Review of underwriting
applications will shift from a team
approach with specialists each having
their own defined role, to a single
reviewer (underwriter) who will pull in
technical expertise only as needed. This
will improve efficiency and
productivity by reducing processing
time as review of applications is passed
through several reviewers, and
eliminating duplication and re-work.
The Account Executive (AE) model will
define two levels of AEs. There will be
a general AE that will focus on nontroubled applications and a troubled
asset specialist who will be assigned
more complex, time-consuming
applications. Additionally, AEs will be
assigned portfolios segmented by
region/lender to enhance the level of
customer service provided to MFH
clients. These changes are not only
expected to bring significant benefits to
MFH, but will pave the way to HUD’s
overall vision for transforming rental
assistance.
(1) Estimate of Cost Savings
Approximately 90 days following the
date of publication of this notice, MFH
will begin consolidating offices and
reducing its operating footprint,
anticipating full implementation of the
proposed changes by the end of FY
2016. It is anticipated that overall
staffing in MFH will be reduced from
1,547 employees in FY 2012 to 1,173 by
the end of FY 2016.
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It is difficult to project the number of
employees who will take advantage of
the buyout, choose to relocate, or resign
because these are individual decisions.
However, it is estimated that 50–75
percent of the affected employees will
take the buyout while 25–50 percent
may opt to relocate. MFH is anticipating
that limited recruiting will be needed in
the remaining 10 offices to supplement
the existing workforce and skills needed
if staffing is below required levels. The
total savings will be about $47M
annually once implementation is
complete. The savings is directly related
to a reduction in salary and benefit costs
due to reducing overall MFH staffing
from 1,547 in FY 2012 to 1,173 by the
end of FY 2016.
Staffing
levels
FY 2012 ........
FY 2016 ........
Estimated
(S&E) Savings ............
Total salaries and
expenses
1547
1173
$184,161,792
146,666,808
(374)
* (46,748,504)
* Savings calculated on FY16 average cost
per FTE.
(2) Estimate of the Additional Cost
a. One Time Costs:
i. Buyout cost (approximately
$13.9M–$20.8M). It is estimated that 50–
75 percent of employees in the affected
offices will take the buyout. The
anticipated total cost includes the
buyout ($25,000) and estimated terminal
leave costs ($10,000).
ii. Personnel relocation cost
(approximately $16.8M–$33.6.1M). It is
estimated that 25–50 percent of
employees in the affected offices will
opt to continue their HUD careers in
other locations via directed
reassignments, and certain relocation
costs will be paid.
iii. Severance or unemployment
compensation costs ($0). No severance
costs are associated with this initiative
since termination of any staff is not
expected.
iv. Net Office closure costs ($6.1M).
No offices will be closed as part of the
MFH realignment, only MFH personnel
will be removed from certain offices;
however this may require
reconfiguration of existing space or
lease modifications to accommodate the
smaller footprint. One time cost
estimates for this reconfiguration in the
40 offices that will no longer have a
MFH presence are estimated at $14.1M.
Factoring in an estimated savings of
$8M as leases begin to expire, this
equates to a one-time cost of
approximately $6.1M. Note: These costs
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Federal Register / Vol. 78, No. 83 / Tuesday, April 30, 2013 / Notices
will be incurred as offices are realigned,
not all at once.
v. Space alteration costs in the ten
remaining offices ($20M). There will be
a one-time cost to reconfigure the space
in the remaining MFH offices, or locate
alternate facilities if space alterations
are not feasible, to accommodate the
increase in staff. These costs are
estimated at $20M and will incur
throughout the various phases of the
realignment.
vi. Training costs ($500,000).
Employees will be provided with
training on performing the new roles
under the enhanced operating model.
b. Reoccurring Costs:
Operating Costs ($0). It is anticipated
that the MFH reorganization impact on
travel funding will be minimal.
(3) Study of the Impact on the Local
Economy
It is anticipated that 25–50 percent of
impacted employees (197–395) will be
reassigned to an alternate location. Any
impact on the local economies in terms
of housing, schools, public services,
taxes, employment and traffic
congestion will be minimal.
(4) Estimate of the Effect of the
Reorganization
As mentioned above, workload will
be spread virtually across the remaining
Hubs and satellite offices based on
utilization. This will result in increased
efficiency gains in both Asset
Management and Asset Development
and help to balance workload across the
remaining Hubs and satellite offices.
Additionally, developing new, more
generalized roles that can perform
multiple functions, will allow
employees to more effectively support
processing and perform multiple
functions as workload ebbs and peaks.
Program delivery will not be impacted
as workload will be shared across
remaining locations and employees will
become more flexible in performing
multiple tasks.
Dated: April 24, 2013
Carol J. Galante
Assistant Secretary for Housing—Federal
Housing Commissioner.
[FR Doc. 2013–10057 Filed 4–29–13; 8:45 am]
BILLING CODE 4210–67–P
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
[Docket No. FR–5648–N–04]
Final Fair Market Rents for the Housing
Choice Voucher Program and
Moderate Rehabilitation Single Room
Occupancy Program Fiscal Year 2013;
Revised
Office of the Assistant
Secretary for Policy Development and
Research, HUD.
ACTION: Notice of Final Fiscal Year (FY)
2013 Fair Market Rents (FMRs), Update.
AGENCY:
SUMMARY: Today’s notice updates the FY
2013 FMRs for Cheyenne, WY, and
Odessa, TX, based on surveys
conducted in September 2012 and for
Burlington, VT, Mountrail County, ND,
Ward County, ND, and Williams
County, ND based on surveys conducted
in November 2012. The FY 2013 FMRs
for these areas reflect the estimated 40th
percentile rent levels trended to April 1,
2013.
DATES: Effective Date: The FMRs
published in this notice are effective on
April 30, 2013.
FOR FURTHER INFORMATION CONTACT: 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 or access the information on
the HUD USER Web site: https://
www.huduser.org/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 2013 FMR
documentation system at https://
www.huduser.org/portal/datasets/fmr/
fmrs/docsys.html&data=fmr13 and 50th
percentile rents for all FMR areas are
published at https://www.huduser.org/
portal/datasets/50per.html.
Questions related to use of FMRs or
voucher payment standards should be
directed to the respective local HUD
program staff. Questions on how to
conduct FMR surveys or concerning
further methodological explanations
may be addressed to Marie L. Lihn or
Peter B. Kahn, Economic and Market
Analysis Division, Office of Economic
Affairs, Office of Policy Development
and Research, telephone 202–708–0590.
Persons with hearing or speech
impairments may access this number
through TTY by calling the toll-free
Federal Relay Service at 800–877–8339.
(Other than the HUD USER information
line and TDD numbers, telephone
numbers are not toll-free.)
SUPPLEMENTARY INFORMATION: In
response to comments submitted to the
FY 2012 and FY 2013 FMRs, surveys
were conducted of the following areas:
Cheyenne, WY, and Odessa, TX,
Burlington-South Burlington, VT and a
three-county group in northwest North
Dakota, Mountrail County, Ward
County, and Williams County. HUD was
evaluating a new survey methodology
and could not conduct any surveys in
time for the publication of the final FY
2013 FMRs. Cheyenne and Odessa were
surveyed in September and Burlington
and the three-county group in North
Dakota were surveyed in November.
The FMRs appearing in the following
table supersede the values found in
Schedule B that became effective on
October 1, 2012, and were printed in the
October 5, 2012. Federal Register
(available from HUD at: https://
www.huduser.org/portal/datasets/fmr/
fmr2013f/FY2013F_SCHEDULE_B.pdf).
The FMRs for the six affected areas
are revised as follows:
FMR by number of bedrooms in unit
2013 Fair market rent area
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0 BR
Burlington-South Burlington, VT MSA .........................................................................
Cheyenne, WY MSA ....................................................................................................
Odessa, TX MSA .........................................................................................................
Mountrail County, ND ..................................................................................................
Ward County, ND .........................................................................................................
Williams County, ND ....................................................................................................
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902
508
659
841
773
771
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980
578
764
878
825
841
30APN1
2 BR
1280
781
983
1041
1087
1026
3 BR
1604
1071
1251
1306
1602
1278
4 BR
1881
1251
1313
1817
1667
1371
]]>Agencies
[Federal Register Volume 78, Number 83 (Tuesday, April 30, 2013)]
[Notices]
[Pages 25293-25295]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-10057]
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-5714-N-01]
Notice of Intent To Change HUD-Wide the Operating Model of the
Office of Multifamily Housing
AGENCY: Office of the Assistant Secretary for Housing--Federal Housing
Commissioner, HUD.
ACTION: Notice.
-----------------------------------------------------------------------
SUMMARY: This notice advises the public that HUD's Office of
Multifamily Housing intends to make changes to its field and
Headquarters operating model. Specifically, the Office of Multifamily
Housing will streamline its organizational structure by consolidating 6
Headquarters business offices into 4 offices and consolidating its
field structure of 17 Hubs to 5 Hub offices and 5 satellite offices
reporting to the Hubs. The other 7 Hubs and 34 program centers will be
consolidated into the remaining 10 offices (5 Hubs and 5 satellite
offices). The 2 existing property disposition centers will be
consolidated into one. Affected offices that will be consolidated
include: Hartford CT, Manchester NH, Providence RI, Newark NJ, Buffalo
NY, Philadelphia PA, Washington DC (field office only), Baltimore MD,
Pittsburgh PA, Richmond VA, Charleston WV, Birmingham AL, Miami FL,
Louisville KY, Jackson MS, Greensboro NC, San Juan PR, Columbia SC,
Knoxville TN, Nashville TN, Indianapolis IN, Minneapolis MN, Cleveland
OH, Milwaukee WI, Little Rock AK, New Orleans LA, Albuquerque NM,
Oklahoma City OK, Houston TX, San Antonio TX, Des Moines IA, St. Louis
MO, Omaha NE, Phoenix AZ, Los Angeles CA, Honolulu HI, Las Vegas NV,
Anchorage AK, and Portland OR. The Seattle WA office will remain open
however; Office of Multifamily Housing employees will be transferred
into like positions and provide support to the Office of Healthcare
Programs. HUD provides this notice in accordance with section 7(p) of
the Department of Housing and Urban Development Act.
FOR FURTHER INFORMATION CONTACT: Joseph Dubose, Office of Housing,
Department of Housing and Urban Development, 451 7th Street SW., Room
6138, Washington, DC 20410; Joseph.Dubose@hud.gov, telephone (202) 402-
6886; TTY number for the hearing- and speech-impaired (202) 708-2565
(these telephone numbers are not toll-free).
SUPPLEMENTARY INFORMATION: In accordance section 7(p) of the Department
of Housing and Urban Development Act (42 U.S.C. 3535(p)), a plan for
the reorganization of any HUD regional, area, insuring, or other field
office may take effect only upon the expiration of 90 days after
publication in the Federal Register of a cost-benefit analysis of the
effects of the plan on each HUD office involved. Such cost-benefit
analysis shall include, but not be limited to (1) an estimate of cost
savings supported by background information detailing the source and
substantiating the amount of the savings; (2) an estimate of the
additional cost which will result from the reorganization; (3) a study
of the impact on the local economy; and (4) an estimate of the effect
of the reorganization on the availability, accessibility, and quality
of services provided for recipients of those services. Where any of the
factors cannot be quantified, the HUD shall provide a statement on the
nature and extent of those factors in the cost-benefit analysis.
Cost Benefit Analysis
A. Background
In order to most effectively use its human capital and other
resources, the Office of Multifamily Housing (MFH) has been actively
working to make fundamental changes to its operating model to improve
effectiveness and efficiency and to maximize opportunities to reshape
and realign its workforce. Important progress has been made to date,
including improving productivity, reducing loan cycle times, increasing
employee engagement, and introducing a more risk-based approach to
asset management activities. However, several fundamental challenges
remain, including a fragmented and unwieldy organizational structure
antiquated systems and processes, and role specification which allows
for little flexibility in allowing employees to perform various roles
while responding to spikes and ebbs in workload.
MFH proposes implementation of 3 categories of changes that will
significantly improve the delivery model, help better manage risk and
lead to an annual cost savings of an estimated $47M upon complete
implementation. These changes include the following:
(1) Streamline the organizational structure;
(2) Introduce risk-based processing across MFH and launch greater
workload sharing and balancing;
(3) Create new roles and abolish outdated or under-utilized
positions.
The goal is to fully implement these changes by the end of fiscal
year (FY) 2016. The reorganization is expected to enhance operational
efficiency, as well as improve the service provided to HUD's customers.
B. Description of Proposed Changes
Under the proposed structure, Headquarters' business units will be
consolidated and reduced from 6 separate offices to 4. In the field,
MFH will consolidate 17 Hubs to 5 Hub offices and 5 satellite offices
reporting to the Hubs. The other 7 Hubs and 34 program centers will be
consolidated into the remaining 10 offices (5 Hub offices and 5
satellite offices). The 2 existing property disposition centers
[[Page 25294]]
will be consolidated into one. Affected offices that will be
consolidated include: Hartford CT, Manchester NH, Providence RI, Newark
NJ, Buffalo NY, Philadelphia PA, Washington DC (field office only),
Baltimore MD, Pittsburgh PA, Richmond VA, Charleston WV, Birmingham AL,
Miami FL, Louisville KY, Jackson MS, Greensboro NC, San Juan PR,
Columbia SC, Knoxville TN, Nashville TN, Indianapolis IN, Minneapolis
MN, Cleveland OH, Milwaukee WI, Little Rock AK, New Orleans LA,
Albuquerque NM, Oklahoma City OK, Houston TX, San Antonio TX, Des
Moines IA, St. Louis MO, Omaha NE, Phoenix AZ, Los Angeles CA, Honolulu
HI, Las Vegas NV, Anchorage AK, and Portland OR. The Seattle WA office
will remain open however; MFH employees will be transferred into like
positions in that office to support the Office of Healthcare Programs.
The 5 remaining Hubs will be in Atlanta GA, New York NY, Chicago IL,
Fort Worth TX, and San Francisco CA. The satellite offices will be in
Denver CO, Kansas City MO, Jacksonville FL, Detroit MI and Boston MA.
This new model will help establish better spans of control and
establish clear reporting lines in the field. The new structure will
allow for more active workload balancing which will enable MFH to
provide more consistent servicing to its customers which will
ultimately enhance the level of customer service received. Employees in
affected offices will have the option to either take a buyout or
continue their HUD careers in one of the 10 remaining locations via
directed reassignments with relocation entitlements.
To ensure that effective program delivery is maintained for all
customers, MFH will introduce risk-based processing and workload
sharing and will create new roles and abolish outdated or under-
utilized positions. To increase processing consistency and enhance
efficiency, workload will be spread virtually across the remaining Hubs
based on utilization. This will result in increased efficiency gains in
both Asset Management and Asset Development, and help to maintain level
work across the remaining hubs. More importantly, reducing the field
footprint will increase the consistency of MFH processing across the
country and provide a standard platform to introduce ongoing
enhancements and efficiencies.
MFH will segment its lenders and loans by key risk factors,
spending less time on low-risk applications to ensure sufficient focus
can be placed on the more high-risk ones. This will improve processing
time and allow MFH to better manage risk within the organization.
Additionally, MFH assets will be segmented by troubled and non-
troubled, which will provide the ability to designate specific staff to
focus on more complex-time-consuming work.
Additionally, MFH currently has defined roles and positions that
are outdated and poorly designed in relationship to specification.
Roles are overspecialized in the Asset Development arena while they are
under specialized in Asset Management. This creates bottlenecks in
processing (not enough of a particular role to meet workload demands or
processing breakdowns when key players are absent). Overspecialization
reduces the ability of employees to perform various functions as
workload demand ebbs and peaks. Under specialization oftentimes reduces
the ability to effectively manage risk.
Under the new operating model, MFH will create two new models, an
Underwriter position to support Asset Development and an Account
Executive model for Asset Management. The creation of these models will
improve efficiency and help to better manage risk. Review of
underwriting applications will shift from a team approach with
specialists each having their own defined role, to a single reviewer
(underwriter) who will pull in technical expertise only as needed. This
will improve efficiency and productivity by reducing processing time as
review of applications is passed through several reviewers, and
eliminating duplication and re-work. The Account Executive (AE) model
will define two levels of AEs. There will be a general AE that will
focus on non-troubled applications and a troubled asset specialist who
will be assigned more complex, time-consuming applications.
Additionally, AEs will be assigned portfolios segmented by region/
lender to enhance the level of customer service provided to MFH
clients. These changes are not only expected to bring significant
benefits to MFH, but will pave the way to HUD's overall vision for
transforming rental assistance.
(1) Estimate of Cost Savings
Approximately 90 days following the date of publication of this
notice, MFH will begin consolidating offices and reducing its operating
footprint, anticipating full implementation of the proposed changes by
the end of FY 2016. It is anticipated that overall staffing in MFH will
be reduced from 1,547 employees in FY 2012 to 1,173 by the end of FY
2016.
It is difficult to project the number of employees who will take
advantage of the buyout, choose to relocate, or resign because these
are individual decisions. However, it is estimated that 50-75 percent
of the affected employees will take the buyout while 25-50 percent may
opt to relocate. MFH is anticipating that limited recruiting will be
needed in the remaining 10 offices to supplement the existing workforce
and skills needed if staffing is below required levels. The total
savings will be about $47M annually once implementation is complete.
The savings is directly related to a reduction in salary and benefit
costs due to reducing overall MFH staffing from 1,547 in FY 2012 to
1,173 by the end of FY 2016.
------------------------------------------------------------------------
Staffing Total salaries
levels and expenses
------------------------------------------------------------------------
FY 2012.................................... 1547 $184,161,792
FY 2016.................................... 1173 146,666,808
Estimated (S&E) Savings.................... (374) * (46,748,504)
------------------------------------------------------------------------
* Savings calculated on FY16 average cost per FTE.
(2) Estimate of the Additional Cost
a. One Time Costs:
i. Buyout cost (approximately $13.9M-$20.8M). It is estimated that
50-75 percent of employees in the affected offices will take the
buyout. The anticipated total cost includes the buyout ($25,000) and
estimated terminal leave costs ($10,000).
ii. Personnel relocation cost (approximately $16.8M-$33.6.1M). It
is estimated that 25-50 percent of employees in the affected offices
will opt to continue their HUD careers in other locations via directed
reassignments, and certain relocation costs will be paid.
iii. Severance or unemployment compensation costs ($0). No
severance costs are associated with this initiative since termination
of any staff is not expected.
iv. Net Office closure costs ($6.1M). No offices will be closed as
part of the MFH realignment, only MFH personnel will be removed from
certain offices; however this may require reconfiguration of existing
space or lease modifications to accommodate the smaller footprint. One
time cost estimates for this reconfiguration in the 40 offices that
will no longer have a MFH presence are estimated at $14.1M. Factoring
in an estimated savings of $8M as leases begin to expire, this equates
to a one-time cost of approximately $6.1M. Note: These costs
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will be incurred as offices are realigned, not all at once.
v. Space alteration costs in the ten remaining offices ($20M).
There will be a one-time cost to reconfigure the space in the remaining
MFH offices, or locate alternate facilities if space alterations are
not feasible, to accommodate the increase in staff. These costs are
estimated at $20M and will incur throughout the various phases of the
realignment.
vi. Training costs ($500,000). Employees will be provided with
training on performing the new roles under the enhanced operating
model.
b. Reoccurring Costs:
Operating Costs ($0). It is anticipated that the MFH reorganization
impact on travel funding will be minimal.
(3) Study of the Impact on the Local Economy
It is anticipated that 25-50 percent of impacted employees (197-
395) will be reassigned to an alternate location. Any impact on the
local economies in terms of housing, schools, public services, taxes,
employment and traffic congestion will be minimal.
(4) Estimate of the Effect of the Reorganization
As mentioned above, workload will be spread virtually across the
remaining Hubs and satellite offices based on utilization. This will
result in increased efficiency gains in both Asset Management and Asset
Development and help to balance workload across the remaining Hubs and
satellite offices. Additionally, developing new, more generalized roles
that can perform multiple functions, will allow employees to more
effectively support processing and perform multiple functions as
workload ebbs and peaks. Program delivery will not be impacted as
workload will be shared across remaining locations and employees will
become more flexible in performing multiple tasks.
Dated: April 24, 2013
Carol J. Galante
Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 2013-10057 Filed 4-29-13; 8:45 am]
BILLING CODE 4210-67-P
