Notice for Suspension of Small Area Fair Market Rent (Small Area FMR) Designations; Solicitation of Comment, 58439-58441 [2017-26695]
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Federal Register / Vol. 82, No. 237 / Tuesday, December 12, 2017 / Notices
takes this approach to recognize the
potential life-changing impacts of
helping individuals move from
unemployment to high-paying jobs.
Such impacts are captured in looking at
average earnings growth, but might be
missed in looking only at the median
growth. It is appropriate in this context
to use averages, or should HUD switch
to medians instead?
3. Has HUD adequately accounted for
variations in local economic conditions?
If not, what further adjustments should
be made? The earnings performance
measure accounts for local economic
conditions by comparing the earnings
growth for FSS participants at a PHA to
the earnings growth for non-FSS
participants at the same PHA with
similar characteristics. The assumption
underlying this approach is that
earnings growth for non-FSS
participants will be higher in areas with
stronger job markets than in areas with
weaker job markets. To attain the same
earnings performance measure, a PHA
in an area with a strong job market
would thus need to demonstrate a
higher level of earnings growth among
FSS participants than would a PHA in
an area with a weaker job market. After
calculating the difference between
earnings growth for FSS and non-FSS
participants at a PHA, the proposed
system makes no further adjustments.
Should HUD further adjust its system to
account for variations in local economic
conditions, and if so, how should HUD
make this adjustment? For example,
HUD could divide the earnings
performance measure by the average
starting earnings for a PHA’s FSS
participants and then compare the
resulting percentages across PHAs.
Further, HUD could adjust the earnings
performance measures by an index that
accounts for local economic conditions.
4. HUD currently allows a PHA to
count FSS participants living in
multifamily FSS programs toward the
minimum number of participants
required to be served in order to qualify
for FSS funding. The PIC data system,
however, does not capture information
on multifamily FSS participants. HUD
requests suggestions on how best to
capture information on multifamily FSS
participants being served by a PHA’s
FSS coordinator to determine a PHA’s
participation rate.
5. HUD currently permits, and funds,
FSS programs in Tribes and Tribally
Designated Housing Entities (TDHEs).
However, Tribes and TDHEs do not
report into the PIC data system. HUD
requests suggestions on how to best
capture information on tribal FSS
participants to determine a score.
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6. HUD currently permits, and funds,
FSS programs at MTW agencies.
However, MTW agencies are only
required to report select FSS data fields
into the PIC system. HUD requests
suggestions on how to best capture
information on MTW FSS participants
to determine a score.
7. How should HUD evaluate FSS
programs offered by HUD-assisted
multifamily properties with Section 8
contracts? These programs are very new
and currently submit quarterly
spreadsheets rather than an FSS
addendum integrated into a HUD data
reporting system.
VIII. Environmental Impact
This notice does not direct, provide
for assistance or loan and mortgage
insurance for, or otherwise govern or
regulate, real property acquisition,
disposition, leasing, rehabilitation,
alteration, demolition, or new
construction, or establish, revise or
provide for standards for construction or
construction materials, manufactured
housing, or occupancy. Accordingly,
under 24 CFR 50.19(c)(1), this notice is
categorically excluded from
environmental review under the
National Environmental Policy Act of
1969 (42 U.S.C. 4321).
Dated: December 5, 2017.
Dominique Blom,
General Deputy Assistant Secretary, Office
of Public and Indian Housing.
[FR Doc. 2017–26696 Filed 12–11–17; 8:45 am]
BILLING CODE 4210–67–P
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
[Docket No. FR–6070–N–01]
Notice for Suspension of Small Area
Fair Market Rent (Small Area FMR)
Designations; Solicitation of Comment
58439
for a period of 30 days. At the expiration
of the 30-day period, HUD will review
the comments and consider if any
further changes to the Suspension are
necessary.
DATES: Comment Due Date: January 11,
2018.
ADDRESSES: Interested persons are
invited to submit comments regarding
this notice, and HUD’s temporary
suspension of the use of Small Area
FMRs, to the Regulations Division,
Office of General Counsel, Department
of Housing and Urban Development,
451 7th Street SW, Room 10276,
Washington, DC 20410–0500.
Communications must refer to the above
docket number and title. There are two
methods for submitting public
comments. All submissions must refer
to the above docket number and title.
Submission of Comments by Mail.
Comments may be submitted by mail to
the Regulations Division, Office of
General Counsel, Department of
Housing and Urban Development, 451
7th Street SW, Room 10276,
Washington, DC 20410–0500.
Electronic Submission of Comments.
Interested persons may submit
comments electronically through the
Federal eRulemaking Portal at
www.regulations.gov. HUD strongly
encourages commenters to submit
comments electronically. Electronic
submission of comments allows the
commenter maximum time to prepare
and submit a comment, ensures timely
receipt by HUD, and enables HUD to
make comments immediately available
to the public. Comments submitted
electronically through the
www.regulations.gov website can be
viewed by other commenters and
interested members of the public.
Commenters should follow the
instructions provided on that site to
submit comments electronically.
Office of Public and Indian
Housing, HUD.
ACTION: Notice; solicitation of comment.
Note: To receive consideration as public
comments, comments must be submitted
through one of the two methods specified
above. Again, all submissions must refer to
the docket number and title of the notice.
On August 10, 2017, pursuant
to the authority provided in regulation,
HUD suspended for two years the
designation for the mandatory use of
Small Area Fair Market Rents (Small
Area FMRs) for certain metropolitan
areas that had previously been
designated for Small Area FMR use
(Suspension). After HUD provided
notice of this suspension, interested
persons requested an opportunity to
review and comment on the
Suspension. While HUD is not required
to post the Suspension for public
comment, this notice solicits comment
No Facsimile Comments. Facsimile
(fax) comments are not acceptable.
Public Inspection of Public
Comments. All properly submitted
comments and communications
submitted to HUD will be available 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
appointment to review the public
comments must be scheduled in
advance by calling the Regulations
Division at 202–708–3055 (this is not a
toll-free number). Individuals with
AGENCY:
SUMMARY:
PO 00000
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12DEN1
58440
Federal Register / Vol. 82, No. 237 / Tuesday, December 12, 2017 / Notices
speech or hearing impairments may
access this number via TTY by calling
the Federal Relay Service at 1–800–877–
8339 (this is a toll-free number). Copies
of all comments submitted are available
for inspection and downloading at
www.regulations.gov.
ethrower on DSK3G9T082PROD with NOTICES
FOR FURTHER INFORMATION CONTACT:
Todd M. Richardson, Deputy Assistant
Secretary, Office of Policy Development,
Office of Policy Development and
Research, Department of Housing and
Urban Development, 451 7th Street SW,
Room 4130, Washington, DC 20410,
202–708–1537, ext. 5706 (this is not a
toll-free number).
SUPPLEMENTARY INFORMATION: Since
October 2011, all Public Housing
Agencies (PHAs) operating the Housing
Choice Voucher (HCV) program in the
Dallas, TX HUD Metro FMR Area have
been using Small Area Fair Market
Rents (Small Area FMRs). The use of
Small Area FMRs was intended to give
HCV families access to areas of high
opportunity and lower poverty by
providing a subsidy that is adequate to
cover rents in those areas, thereby
reducing the number of voucher
families that reside in areas of high
poverty concentration. The PHAs in
Dallas began using Small Area FMRs as
the result of a legal settlement.
HUD announced the commencement
of the Small Area FMR demonstration in
November 2012. Five PHAs participated
voluntarily in this demonstration,
which sought to assess the effect on
families of using FMRs published at the
U.S. Postal Service ZIP code level (i.e.,
Small Area FMRs) in lieu of FMRs
published at the metropolitan area
level.1
In 2015, HUD awarded a cooperative
agreement to Abt Associates to evaluate
the use of Small Area FMRs by the five
PHAs that voluntarily participated in
the demonstration, as well as two PHAs
operating the voucher program in the
Dallas, TX HUD Metro FMR Area. Abt
was charged with examining whether
and to what extent providing higher
subsidies in ZIP code areas where rents
are higher, and lower subsidies in ZIP
code areas where rents are lower, helps
HCV families to better access areas of
opportunity. HUD also requested that
the evaluation examine how the
transition from metropolitan-wide to
Small Area FMRs affected families and
landlords, and the impact of Small Area
FMRs on HCV subsidy and
administrative costs.
1 Four of the five demonstration PHAs requested
and were permitted by HUD to continue using
Small Area FMRs in the operation of their HCV
programs after the demonstration ended.
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Jkt 244001
On November 16, 2016, HUD
published its ‘‘Establishing a More
Effective Fair Market Rent System;
Using Small Area Fair Market Rents in
the Housing Choice Voucher Program
Instead of the Current 50th Percentile
FMR’’ final rule (81 FR 80567). This
final rule required the use of Small Area
FMRs in certain metropolitan areas
instead of the 50th percentile rent
previously used. On the same day, HUD
published a notice listing areas in which
the use of Small Area FMRs is
mandatory beginning on October 1,
2017 (81 FR 80678).
On April 26, 2017, HUD received
Abt’s Small Area Fair Market Rent
Demonstration Evaluation Interim
Report.2 The Interim Report examines
changes in outcomes from 2010 to 2015
and documents several findings that
HUD finds concerning. In addition, it
indicates that further research is needed
to address several critical questions
with respect to the potential harm to
HCV families (both participants and
applicants) and PHAs in areas
transitioning to Small Area FMRs.
On August 10, 2017, pursuant to the
authority provided in regulation, HUD
suspended the designation for the
mandatory use of Small Area FMRs for
23 of the 24 metropolitan areas that
would become subject to the
requirement on October 1, 2017
(Suspension).3 The Suspension was
made pursuant to 24 CFR 888.113(c)(4),
which provides that HUD may suspend
the Small Area FMR designation for a
metropolitan area when HUD by notice
makes a documented determination that
such action is warranted. Specifically,
§ 888.113(c)(4) provides:
HUD will designate Small Area FMR areas
at the beginning of a Federal fiscal year, such
designations will be permanent, and [HUD]
will make new area designations thereafter as
new data becomes available. HUD may
suspend a Small Area FMR designation from
a metropolitan area, or may temporarily
exempt a PHA in a Small Area FMR
metropolitan area from use of the Small Area
FMRs, when HUD by notice makes a
documented determination that such action
is warranted. Actions that may serve as the
basis of a suspension of Small Area FMRs
are:
i. A Presidentially declared disaster area
that results in the loss of a substantial
number of housing units;
2 The Small Area Fair Market Rent Demonstration
Evaluation Interim Report may be found at https://
www.huduser.gov/portal/sites/default/files/pdf/
SAFMR-Interim-Report.pdf.
3 The Small Area FMR designation remains in
effect for the Dallas-Plano-Irving, TX Metro Division
(also referred to as the Dallas, TX HUD Metro FMR
Area). All PHAs administering the HCV program in
the Dallas-Plano-Irving, TX Metro Division have
been using Small Area FMRs since 2011 as a result
of a legal settlement.
PO 00000
Frm 00063
Fmt 4703
Sfmt 4703
ii. A sudden influx of displaced
households needing permanent housing; or
iii. Other events as determined by the
Secretary (emphasis added).
Based on the findings in Abt’s Small
Area Fair Market Rent Demonstration
Evaluation Interim Report, summarized
above, HUD has concerns that the
mandatory use of Small Area FMRs,
without sufficient preparation and
mitigation of potential unintended
consequences, could put some PHAs at
risk of causing an adverse rental
housing market condition. Accordingly,
after careful consideration, HUD issued
the Suspension of the Small Area FMR
designation for 23 of the 24
metropolitan areas that had previously
been designated for mandatory Small
Area FMR use. The Suspension was for
two Federal fiscal years (FYs), becoming
effective at the beginning of FY 2020
(October 1, 2019) instead of FY 2018. To
provide notice to affected PHAs, HUD
sent letters to more than 200 PHAs in
the 23 metropolitan areas noted in the
Suspension. Additionally, HUD posted
an article regarding the Suspension on
its website.4
The delayed implementation of
mandatory Small Area FMR adoption
will provide HUD with reasonable time
to analyze the final findings of the
demonstration and determine what
measures are necessary to mitigate
negative effects, if possible. For
example, the delay may allow HUD to
develop guidance and technical
assistance that is informed by the
lessons learned from the demonstration.
Notwithstanding the exercise of this
authority, the Small Area FMR Rule
permits any PHA that voluntarily seeks
to adopt SAFMRs to do so. The program
regulations at 24 CFR 888.113(c)(3)
provide that a PHA administering an
HCV program in a metropolitan area not
subject to the mandatory application of
Small Area FMRs may opt to use Small
Area FMRs by seeking approval from
HUD’s Office of Public and Indian
Housing (PIH) through written request
to PIH. In light of the findings of Abt’s
Small Area Fair Market Rent
Demonstration Evaluation Interim
Report referenced above, should HUD
receive a request under this provision,
HUD will consider in its approval
determination a PHA’s ability to provide
reasonable assurance that adoption of
Small Area FMRs will not result in an
adverse housing market condition.
With this notice, HUD seeks public
comment on the Suspension. While
4 See HUD, Giving Public Housing Agencies More
Time to Succeed, PD&R Edge, https://
www.huduser.gov/portal/pdredge/pdr-edge-frmasst-sec-082817.html.
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Federal Register / Vol. 82, No. 237 / Tuesday, December 12, 2017 / Notices
HUD is not required to post the
Suspension for public comment, this
notice solicits comment for a period of
30 days. At the expiration of the 30-day
period, HUD will review the comments
and consider if any further changes to
the Suspension are necessary. Interested
parties can find the Suspension in the
Supporting Documents section of the
docket associated with this notice, at
www.regulations.gov, and on HUD’s
website at https://www.huduser.gov/
portal/datasets/fmr/smallarea/
index.html.
Dated: December 1, 2017.
Dominique Blom,
General Deputy Assistant Secretary, Office
of Public and Indian Housing.
[FR Doc. 2017–26695 Filed 12–11–17; 8:45 am]
BILLING CODE 4210–67–P
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
[Docket No. FR 6069–N–01]
Advanced Notice of EnVision Center
Demonstration
Office of the Secretary, HUD.
Notice.
AGENCY:
ACTION:
Through this notice, HUD
solicits comment on a demonstration
designed to test the effectiveness of
collaborative efforts by government,
industry, and nonprofit organizations to
accelerate economic mobility of lowincome households in communities that
include HUD-assisted housing through
EnVision Centers, centralized hubs for
supportive services focusing on the four
pillars of Economic Empowerment,
Educational Advancement, Health and
Wellness, and Character and
Leadership. Approximately 10
communities, selected from across the
country, are anticipated to participate in
the demonstration. The purpose of the
demonstration is to explore the
potential of a new service-delivery
mechanism to provide HUD-assisted
households the ability to benefit from
life-changing opportunities that the
advancement of the four pillars affords.
DATES: Comment Due Date: February 12,
2018.
ADDRESSES: Interested persons are
invited to submit comments responsive
to this notice to the Office of General
Counsel, Regulations Division,
Department of Housing and Urban
Development, 451 7th Street SW, Room
10276, Washington, DC 20410–0001. All
submissions should refer to the above
docket number and title. Submission of
public comments may be carried out by
hard copy or electronic submission.
ethrower on DSK3G9T082PROD with NOTICES
SUMMARY:
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20:03 Dec 11, 2017
Jkt 244001
1. Submission of Hard Copy
Comments. Comments may be
submitted by mail or hand delivery.
Each commenter submitting hard copy
comments, by mail or hand delivery,
should submit comments to the address
above, addressed to the attention of the
Regulations Division. Due to security
measures at all federal agencies,
submission of comments by mail often
results in delayed delivery. To ensure
timely receipt of comments, HUD
recommends that any comments
submitted by mail be submitted at least
2 weeks in advance of the public
comment deadline. All hard copy
comments received by mail or hand
delivery are a part of the public record
and will be posted to https://
www.regulations.gov without change.
2. Electronic Submission of
Comments. Interested persons may
submit comments electronically through
the Federal eRulemaking Portal at
https://www.regulations.gov. HUD
strongly encourages commenters to
submit comments electronically.
Electronic submission of comments
allows the commenter maximum time to
prepare and submit a comment, ensures
timely receipt by HUD, and enables
HUD to make comments immediately
available to the public. Comments
submitted electronically through the
https://www.regulations.gov website can
be viewed by other commenters and
interested members of the public.
Commenters should follow instructions
provided on that site to submit
comments electronically.
No Facsimile Comments. Facsimile
(fax) comments are not acceptable.
Public Inspection of Comments. All
comments submitted to HUD regarding
this notice will be available, without
charge, for public inspection and
copying between 8 a.m. and 5 p.m.,
Eastern Time, 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).
Individuals with speech or hearing
impairments may access this number
through TTY by calling the Federal
Relay Service at 800–877–8339 (this is
a toll-free number). Copies of all
comments submitted are available for
inspection and downloading at https://
www.regulations.gov.
FOR FURTHER INFORMATION CONTACT:
Ariel Pereira, Associate General Counsel
for Legislation and Regulations, Office
of General Counsel, Department of
Housing and Urban Development, 451
Seventh Street SW, Room 10282,
PO 00000
Frm 00064
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58441
Washington, DC 20410–7000, telephone
number 202–402–5132 (this is not a tollfree number). Persons with hearing or
speech impairments may access this
number through TTY by calling the
Federal Relay Service at 800–877–8339
(this is a toll-free number).
SUPPLEMENTARY INFORMATION:
I. Background
Under the leadership of President
Donald J. Trump, the Administration is
committed to reforming government
services and expanding opportunities
for more Americans to become selfsufficient. The EnVision Center
demonstration focuses on empowering
people to leave HUD-assisted housing
through self-sufficiency to become
responsible homeowners and renters in
the private market. By doing so, HUD
will be able to make those resources
available to others and help more
Americans.
The EnVision Centers demonstration
is premised on the notion that financial
support alone is insufficient to solve the
problem of poverty. Intentional and
collective efforts across a diverse set of
organizations are needed to implement
a holistic approach to foster long-lasting
self-sufficiency. EnVision Centers will
provide communities with a centralized
hub for support in the following four
pillars: (1) Economic Empowerment, (2)
Educational Advancement, (3) Health
and Wellness, and (4) Character and
Leadership. The Economic
Empowerment pillar is designed to
improve the economic sustainability of
individuals residing in HUD-assisted
housing by empowering them with
opportunities to improve their economic
outlook. The Education pillar seeks to
bring educational opportunities directly
to HUD-assisted housing and includes
partnering with public and private
organizations that approach education
in non-traditional ways on nontraditional platforms. The Health and
Wellness pillar is designed to improve
access to health outcomes by
individuals and families living in HUDassisted housing. The Character and
Leadership pillar is designed to enable
all individuals and families residing in
HUD-assisted housing, especially young
people, to reach their full potential as
productive, caring, responsible citizens
by encouraging participation in
volunteer and mentoring opportunities.
Through results-driven partnerships
with federal agencies, state and local
governments, non-profits, faith-based
organizations, corporations, public
housing authorities (PHAs), tribal
designated housing entities (TDHEs)
and housing finance agencies, EnVision
Centers will leverage public and private
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Agencies
[Federal Register Volume 82, Number 237 (Tuesday, December 12, 2017)]
[Notices]
[Pages 58439-58441]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-26695]
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-6070-N-01]
Notice for Suspension of Small Area Fair Market Rent (Small Area
FMR) Designations; Solicitation of Comment
AGENCY: Office of Public and Indian Housing, HUD.
ACTION: Notice; solicitation of comment.
-----------------------------------------------------------------------
SUMMARY: On August 10, 2017, pursuant to the authority provided in
regulation, HUD suspended for two years the designation for the
mandatory use of Small Area Fair Market Rents (Small Area FMRs) for
certain metropolitan areas that had previously been designated for
Small Area FMR use (Suspension). After HUD provided notice of this
suspension, interested persons requested an opportunity to review and
comment on the Suspension. While HUD is not required to post the
Suspension for public comment, this notice solicits comment for a
period of 30 days. At the expiration of the 30-day period, HUD will
review the comments and consider if any further changes to the
Suspension are necessary.
DATES: Comment Due Date: January 11, 2018.
ADDRESSES: Interested persons are invited to submit comments regarding
this notice, and HUD's temporary suspension of the use of Small Area
FMRs, to the Regulations Division, Office of General Counsel,
Department of Housing and Urban Development, 451 7th Street SW, Room
10276, Washington, DC 20410-0500. Communications must refer to the
above docket number and title. There are two methods for submitting
public comments. All submissions must refer to the above docket number
and title.
Submission of Comments by Mail. Comments may be submitted by mail
to the Regulations Division, Office of General Counsel, Department of
Housing and Urban Development, 451 7th Street SW, Room 10276,
Washington, DC 20410-0500.
Electronic Submission of Comments. Interested persons may submit
comments electronically through the Federal eRulemaking Portal at
www.regulations.gov. HUD strongly encourages commenters to submit
comments electronically. Electronic submission of comments allows the
commenter maximum time to prepare and submit a comment, ensures timely
receipt by HUD, and enables HUD to make comments immediately available
to the public. Comments submitted electronically through the
www.regulations.gov website can be viewed by other commenters and
interested members of the public. Commenters should follow the
instructions provided on that site to submit comments electronically.
Note: To receive consideration as public comments, comments must
be submitted through one of the two methods specified above. Again,
all submissions must refer to the docket number and title of the
notice.
No Facsimile Comments. Facsimile (fax) comments are not acceptable.
Public Inspection of Public Comments. All properly submitted
comments and communications submitted to HUD will be available 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 appointment to review the public comments must be
scheduled in advance by calling the Regulations Division at 202-708-
3055 (this is not a toll-free number). Individuals with
[[Page 58440]]
speech or hearing impairments may access this number via TTY by calling
the Federal Relay Service at 1-800-877-8339 (this is a toll-free
number). Copies of all comments submitted are available for inspection
and downloading at www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Todd M. Richardson, Deputy Assistant
Secretary, Office of Policy Development, Office of Policy Development
and Research, Department of Housing and Urban Development, 451 7th
Street SW, Room 4130, Washington, DC 20410, 202-708-1537, ext. 5706
(this is not a toll-free number).
SUPPLEMENTARY INFORMATION: Since October 2011, all Public Housing
Agencies (PHAs) operating the Housing Choice Voucher (HCV) program in
the Dallas, TX HUD Metro FMR Area have been using Small Area Fair
Market Rents (Small Area FMRs). The use of Small Area FMRs was intended
to give HCV families access to areas of high opportunity and lower
poverty by providing a subsidy that is adequate to cover rents in those
areas, thereby reducing the number of voucher families that reside in
areas of high poverty concentration. The PHAs in Dallas began using
Small Area FMRs as the result of a legal settlement.
HUD announced the commencement of the Small Area FMR demonstration
in November 2012. Five PHAs participated voluntarily in this
demonstration, which sought to assess the effect on families of using
FMRs published at the U.S. Postal Service ZIP code level (i.e., Small
Area FMRs) in lieu of FMRs published at the metropolitan area level.\1\
---------------------------------------------------------------------------
\1\ Four of the five demonstration PHAs requested and were
permitted by HUD to continue using Small Area FMRs in the operation
of their HCV programs after the demonstration ended.
---------------------------------------------------------------------------
In 2015, HUD awarded a cooperative agreement to Abt Associates to
evaluate the use of Small Area FMRs by the five PHAs that voluntarily
participated in the demonstration, as well as two PHAs operating the
voucher program in the Dallas, TX HUD Metro FMR Area. Abt was charged
with examining whether and to what extent providing higher subsidies in
ZIP code areas where rents are higher, and lower subsidies in ZIP code
areas where rents are lower, helps HCV families to better access areas
of opportunity. HUD also requested that the evaluation examine how the
transition from metropolitan-wide to Small Area FMRs affected families
and landlords, and the impact of Small Area FMRs on HCV subsidy and
administrative costs.
On November 16, 2016, HUD published its ``Establishing a More
Effective Fair Market Rent System; Using Small Area Fair Market Rents
in the Housing Choice Voucher Program Instead of the Current 50th
Percentile FMR'' final rule (81 FR 80567). This final rule required the
use of Small Area FMRs in certain metropolitan areas instead of the
50th percentile rent previously used. On the same day, HUD published a
notice listing areas in which the use of Small Area FMRs is mandatory
beginning on October 1, 2017 (81 FR 80678).
On April 26, 2017, HUD received Abt's Small Area Fair Market Rent
Demonstration Evaluation Interim Report.\2\ The Interim Report examines
changes in outcomes from 2010 to 2015 and documents several findings
that HUD finds concerning. In addition, it indicates that further
research is needed to address several critical questions with respect
to the potential harm to HCV families (both participants and
applicants) and PHAs in areas transitioning to Small Area FMRs.
---------------------------------------------------------------------------
\2\ The Small Area Fair Market Rent Demonstration Evaluation
Interim Report may be found at https://www.huduser.gov/portal/sites/default/files/pdf/SAFMR-Interim-Report.pdf.
---------------------------------------------------------------------------
On August 10, 2017, pursuant to the authority provided in
regulation, HUD suspended the designation for the mandatory use of
Small Area FMRs for 23 of the 24 metropolitan areas that would become
subject to the requirement on October 1, 2017 (Suspension).\3\ The
Suspension was made pursuant to 24 CFR 888.113(c)(4), which provides
that HUD may suspend the Small Area FMR designation for a metropolitan
area when HUD by notice makes a documented determination that such
action is warranted. Specifically, Sec. 888.113(c)(4) provides:
---------------------------------------------------------------------------
\3\ The Small Area FMR designation remains in effect for the
Dallas-Plano-Irving, TX Metro Division (also referred to as the
Dallas, TX HUD Metro FMR Area). All PHAs administering the HCV
program in the Dallas-Plano-Irving, TX Metro Division have been
using Small Area FMRs since 2011 as a result of a legal settlement.
HUD will designate Small Area FMR areas at the beginning of a
Federal fiscal year, such designations will be permanent, and [HUD]
will make new area designations thereafter as new data becomes
available. HUD may suspend a Small Area FMR designation from a
metropolitan area, or may temporarily exempt a PHA in a Small Area
FMR metropolitan area from use of the Small Area FMRs, when HUD by
notice makes a documented determination that such action is
warranted. Actions that may serve as the basis of a suspension of
Small Area FMRs are:
i. A Presidentially declared disaster area that results in the
loss of a substantial number of housing units;
ii. A sudden influx of displaced households needing permanent
housing; or
iii. Other events as determined by the Secretary (emphasis
added).
Based on the findings in Abt's Small Area Fair Market Rent
Demonstration Evaluation Interim Report, summarized above, HUD has
concerns that the mandatory use of Small Area FMRs, without sufficient
preparation and mitigation of potential unintended consequences, could
put some PHAs at risk of causing an adverse rental housing market
condition. Accordingly, after careful consideration, HUD issued the
Suspension of the Small Area FMR designation for 23 of the 24
metropolitan areas that had previously been designated for mandatory
Small Area FMR use. The Suspension was for two Federal fiscal years
(FYs), becoming effective at the beginning of FY 2020 (October 1, 2019)
instead of FY 2018. To provide notice to affected PHAs, HUD sent
letters to more than 200 PHAs in the 23 metropolitan areas noted in the
Suspension. Additionally, HUD posted an article regarding the
Suspension on its website.\4\
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\4\ See HUD, Giving Public Housing Agencies More Time to
Succeed, PD&R Edge, https://www.huduser.gov/portal/pdredge/pdr-edge-frm-asst-sec-082817.html.
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The delayed implementation of mandatory Small Area FMR adoption
will provide HUD with reasonable time to analyze the final findings of
the demonstration and determine what measures are necessary to mitigate
negative effects, if possible. For example, the delay may allow HUD to
develop guidance and technical assistance that is informed by the
lessons learned from the demonstration.
Notwithstanding the exercise of this authority, the Small Area FMR
Rule permits any PHA that voluntarily seeks to adopt SAFMRs to do so.
The program regulations at 24 CFR 888.113(c)(3) provide that a PHA
administering an HCV program in a metropolitan area not subject to the
mandatory application of Small Area FMRs may opt to use Small Area FMRs
by seeking approval from HUD's Office of Public and Indian Housing
(PIH) through written request to PIH. In light of the findings of Abt's
Small Area Fair Market Rent Demonstration Evaluation Interim Report
referenced above, should HUD receive a request under this provision,
HUD will consider in its approval determination a PHA's ability to
provide reasonable assurance that adoption of Small Area FMRs will not
result in an adverse housing market condition.
With this notice, HUD seeks public comment on the Suspension. While
[[Page 58441]]
HUD is not required to post the Suspension for public comment, this
notice solicits comment for a period of 30 days. At the expiration of
the 30-day period, HUD will review the comments and consider if any
further changes to the Suspension are necessary. Interested parties can
find the Suspension in the Supporting Documents section of the docket
associated with this notice, at www.regulations.gov, and on HUD's
website at https://www.huduser.gov/portal/datasets/fmr/smallarea/.
Dated: December 1, 2017.
Dominique Blom,
General Deputy Assistant Secretary, Office of Public and Indian
Housing.
[FR Doc. 2017-26695 Filed 12-11-17; 8:45 am]
BILLING CODE 4210-67-P