Streamlining and Implementation of Economic Growth, Regulatory Relief, and Consumer Protection Act Changes to Family Self-Sufficiency (FSS) Program, 59234-59254 [2020-18896]
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Federal Register / Vol. 85, No. 183 / Monday, September 21, 2020 / Proposed Rules
By direction of the Commission,
Commissioner Slaughter and Commissioner
Wilson not participating.
April J. Tabor,
Acting Secretary.
[FR Doc. 2020–19176 Filed 9–18–20; 8:45 am]
BILLING CODE 6750–01–C
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
24 CFR Parts 887 and 984
[Docket No. FR–6114–P–01]
RIN 2577–AD09
Streamlining and Implementation of
Economic Growth, Regulatory Relief,
and Consumer Protection Act Changes
to Family Self-Sufficiency (FSS)
Program
Office of the Assistant
Secretary for Public and Indian
Housing, HUD, and Office of the
Assistant Secretary for Housing—
Federal Housing Commissioner, HUD.
ACTION: Proposed rule.
AGENCY:
The Economic Growth,
Regulatory Relief, and Consumer
Protection Act (‘‘the Economic Growth
Act’’) was signed into law on May 24,
2018, amending HUD’s Family SelfSufficiency (FSS) program. Section 306
of the Act made multiple amendments
to the FSS program, including changes
to the size calculation for the FSS
program, expanding the definition of
eligible family to include tenants of
certain privately owned multifamily
projects subsidized with Project-Based
Rental Assistance (PBRA), updating the
FSS Contract of Participation (CoP),
reducing burdens on Public Housing
Agencies (PHAs) and multifamily
assisted housing owners, clarifying
escrow account requirements, and
updating the program coordinator and
action plan requirements. This proposed
rule also includes additional changes to
reduce burden and streamline the
program for PHAs, owners, and eligible
families.
DATES: Comment due date: November
20, 2020.
ADDRESSES: Interested persons are
invited to submit comments regarding
this proposed rule. All communications
must refer to the above docket number
and title. There are two methods for
submitting public comments.
1. Submission of Comments by Mail.
Comments may be submitted by mail to
the Regulations Division, Office of
General Counsel, U.S. Department of
Housing and Urban Development, 451
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SUMMARY:
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7th Street SW, Room 10276,
Washington, DC 20410–0500.
2. 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. All
submissions must refer to the docket
number and title of the rule.
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
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 via TTY by calling the toll-free
Federal Relay Service at 800–877–8339.
Copies of all comments submitted are
available for inspection and
downloading at www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: For
Public Housing FSS contact Anice S.
Chenault, Office of Public and Indian
Housing, U.S. Department of Housing
and Urban Development, 451 7th Street
SW, Room 4120, Washington, DC 20410;
telephone number 502–618–6163 (this
is not a toll-free number); and for
Multifamily FSS contact Carissa L.
Janis, Office of Multifamily Housing
Programs, U.S. Department of Housing
and Urban Development, 451 7th Street
SW, Room 6152, Washington, DC 20410;
telephone number 202–402–2487 (this
is not a toll-free number). The public is
encouraged to email questions to FSS@
hud.gov. Persons with hearing or speech
impairments may access this number
through TTY by calling the toll-free
Federal Relay Service at 800–877–8339.
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SUPPLEMENTARY INFORMATION:
I. Background
In 1990, section 554 of the Cranston
Gonzalez National Affordable Housing
Act (Pub. L. 101–625, approved
November 28, 1990) amended the
United States Housing Act of 1937 by
adding a new Section 23 (42 U.S.C.
1437u) to create the FSS program. The
FSS program requires that PHAs) and
Indian Housing Authorities (IHAs) 1 use
Public and Indian Housing assistance
and Section 8 Housing assistance rental
voucher programs, together with public
and private resources, to provide
supportive services, case management,
and an escrow account to participating
families, with the intent to help families
achieve economic independence and
self-sufficiency. The goal of the program
is to enable participating low-income
families to increase their earned income
and reduce their dependency on welfare
assistance and rental subsidies. FSS
program coordinators create plans with
participating families to achieve goals
and connect them with services that
will assist the family in making progress
toward economic security. As the
family’s earnings increase, the
difference between the original rent and
the rent that increases due to increased
earned income is credited to an interestbearing escrow account on behalf of the
family. Families that meet program
requirements and successfully complete
the FSS program receive their accrued
FSS escrow funds, plus interest. No
formal restrictions exist on the use of
the escrowed funds, but many families
use the funds to help with the purchase
of a home, debt reduction, postsecondary education, or to start a new
business.
In September 1991, HUD initially
implemented the FSS program by
notice 2 and the following year made
several additional changes to the FSS
program to implement amendments
made by the Housing and Community
Development Act of 1992 (Pub. L. 102–
550), approved October 28, 1992 (the
1992 Act). (See section 106 of the 1992
Act.) On May 27, 1993, HUD issued an
interim final rule implementing the FSS
program in its Indian Housing program
at 24 CFR part 905, Public Housing
program regulations at 24 CFR part 962,
and Section 8 program regulations at 24
CFR part 984. 56 FR 49588. On March
5, 1996, HUD streamlined the FSS
program by consolidating the Public
1 The Native American Housing Assistance and
Self Determination Act of 1996 (25 U.S.C. 4101 et
seq.) (NAHASDA) removed the application of the
FSS program to IHAs.
2 ‘‘Notice of FSS Program Guidelines’’ September
30, 1991 at 56 FR 49592.
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Federal Register / Vol. 85, No. 183 / Monday, September 21, 2020 / Proposed Rules
Housing and the Section 8 FSS
regulations and by eliminating
redundant or otherwise unnecessary
provisions into 24 CFR part 984. 61 FR
8814.
On October 26, 1996, the Native
American Housing Assistance and SelfDetermination Act of 1996 (NAHASDA)
(25 U.S.C. 4101 et seq.) amended the
United States Housing Act of 1937 by
removing the language applying the FSS
program to IHAs. HUD subsequently
removed the FSS regulations applicable
to the Indian Housing program. 63 FR
12334. Lastly, on March 29, 2000, HUD
implemented changes to the FSS
program made by the Quality Housing
and Work Responsibility Act of 1998
(title V of the FY 1999 HUD
Appropriations Act, Pub. L. 105–276,
112 Stat. 2518, approved October 21,
1998), which amended the United States
Housing Act of 1937 (42 U.S.C. 1437, et
seq.) by changing the definition of
welfare assistance, the minimum
program size, action plan, and
portability. 65 FR 16691.
More recently, the 2015 Consolidated
Appropriations Act (Pub. L. 113–235),
approved December 26, 2014,
authorized a demonstration of the FSS
program for multifamily assisted
housing owners. In August 2016, HUD
provided the requirements for
multifamily assisted housing owners
seeking to implement a voluntary FSS
program by notice. See Family SelfSufficiency Program in Multifamily,
Housing Notice: H–2016–08, August 26,
2016. The notice incorporated many of
the definitions and requirements that
are found in 24 CFR part 984 and
applied them to the voluntary FSS
program for multifamily owners.
On May 24, 2018, the Economic
Growth, Regulatory Relief, and
Consumer Protection Act (the
‘‘Economic Growth Act’’) was signed
into law (Pub. L. 115–174), and section
306 of title III, Protection for Veterans,
Consumers and Homeowners, amended
the United States Housing Act of 1937
(42 U.S.C. 1437, et seq.), FSS program.
The changes include updating the
mandatory size of a PHA’s required FSS
program and available exceptions;
updating definition of eligible families;
allowing family members other than the
Head of Household to sign the Contract
of Participation (CoP) and to meet the
employment obligation; amending the
process for providing supportive
services; expanding the time period for
participating in the FSS program;
amending the requirements pertaining
to the management of the escrow
account, including the requirements for
forfeiture of the escrow funds; amending
the Program Coordinating Committee
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(PCC) functions; and, establishing new
reporting requirements. Also, the
Economic Growth Act provided new
provisions for private owners of
multifamily assisted housing to set up
their own FSS program or enter into a
Cooperative Agreement with another
private owner or PHA to offer an FSS
program to the owner’s assisted
residents.
II. This Proposed Rule—Summary of
Changes
This proposed rule implements
changes and streamlines the FSS
program, removes any reference to the
certificate program and updates
definitions, as required by the Economic
Growth Act. HUD makes changes to the
existing FSS regulations at 24 CFR part
984 and adds a new 24 CFR part 887 to
address the FSS program for owners of
multifamily assisted housing. HUD also
updates references to PHAs and owners
and clarifies the provisions that would
apply to both when operating an FSS
program. Owners would be subject to
the requirements only if they are
operating a voluntary program pursuant
to cross-references in 24 CFR part 887.
The following describes the significant
changes to the regulation:
The Public Housing FSS Program
§ 984.101
Scope
Purpose, Applicability,
The purpose and applicability in
§ 984.101 has minor technical changes.
The scope of the regulations, paragraph
(c), is amended by removing subsections
(1), (2), (3)(i), and (3)(ii) and by adding
a generic reference to § 984.105, which
provides that PHAs must continue an
FSS program if they were required to
have one as of May 24, 2018. Therefore,
the citation to specific fiscal year (FY)
funding is removed and replaced by a
general requirement that PHAs receiving
funding under section 8(o) and section
9 are required to comply with § 984.105.
A non-participation paragraph is also
added to this section, to clarify that a
family’s rental assistance shall not be
delayed or terminated by reason of a
family electing not to participate in an
FSS program.
§ 984.102
Program Objectives
HUD makes a minor amendment to
this section, including a change
clarifying that HUD will evaluate the
performance of a local FSS program
using a scoring system that measures
graduation from the program, increased
earned income, program participation,
and similar factors, as provided by HUD
through a Federal Register notice.
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§ 984.103 Definitions
The proposed rule streamlines and
adds clarity to the definition of eligible
families. The term ‘‘eligible families’’ is
defined under the proposed rule as
current Public Housing residents and
families receiving tenant-based or
project-based assistance under section
8(o). This means that participants in the
Housing Choice Voucher (HCV)
homeownership program (under section
8(y) of the U.S. Housing Act of 1937) are
not eligible to participate in the FSS
program. However, participants in the
Project Based Voucher (PBV) program
(under section 8(o)(13) of the U.S.
Housing Act of 1937) are eligible to
participate. The proposed regulations
include definitions for ‘‘owner’’ and
‘‘multifamily assisted housing’’ to
clarify the newly expanded applicability
of regulations for owners of multifamily
assisted housing (also known as ProjectBased Rental Assistance (PBRA)) under
section 8 of the 1937 Act.
Similarly, the following terms have
been added to provide clarity to the
process of calculating an FSS family’s
escrow: ‘‘baseline annual earned
income’’; ‘‘baseline monthly rent’’;
‘‘current annual earned income’’; and
‘‘current monthly rent.’’ In the
definition of baseline annual earned
income, the proposed rule instructs
PHAs and owners to add back any
disregard of earned income associated
with self-sufficiency initiatives that may
be applicable in the determination of
family income. This will help ensure
that escrow amounts are the result of
increases in earned income while the
family is in the FSS program (as
opposed to credit for progress made
before entering the FSS program).
Additionally, the definitions of
‘‘baseline monthly rent’’ and ‘‘current
monthly rent’’ take into account the use
of flat rents and ceiling rents for Public
Housing families. This ensures that
families paying a flat rent or ceiling rent
that is less than their income-based rent
will escrow only up to the amount of
rent that they are actually paying (flat/
ceiling rent). A definition for the term
‘‘FSS family in good standing’’ has been
added because this term is used in
§ 984.305(c)(1) and (f)(2) of the proposed
rule.
Section 306 of the Economic Growth
Act changes the requirement that a PHA
directly deliver supportive services, to
requiring that a PHA or owner must
only coordinate the availability of
supportive services but not directly
deliver. Also, section 306 makes slight
changes to the list of supportive services
that may be coordinated through the
FSS program. The proposed rule revises
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the definition of supportive services to
conform to these statutory changes.
The following terms have been
revised to conform to changes described
later in this preamble: ‘‘FSS family,’’
‘‘FSS slots,’’ ‘‘head of the FSS family,’’
and ‘‘Individual Training and Services
Plan’’ (ITSP). In addition, the following
terms have been removed because they
refer to obsolete programs that are no
longer referenced in the regulation: Job
Opportunities and Basic Skills Training
(JOBS) and Jobs Training and
Partnership Act (JTPA) programs. The
Economic Growth Act changed the term
of the FSS contract so an FSS family
will be required to fulfill their
obligations under the CoP no later than
5 years after the first recertification of
income after the execution date of the
contract. HUD is revising the definition
of the effective date of the CoP from the
first day of the month following the
month in which the parties executed the
contract to the date the parties execute
(sign) the contract.
Question 1: HUD requests feedback on
how the proposed rule defines the
effective date of the CoP. Specifically,
are there rent or other implications
which would cause the proposed
definition to be an issue?
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§ 984.104 Basic Requirements of the
FSS Program
The proposed rule revises § 984.104 to
add reference to the regulatory citations
for the program.
§ 984.105 Minimum Program Size
Some PHAs are statutorily required to
operate an FSS program as a result of
accepting increased funding for
vouchers and Public Housing between
the inception of the FSS program in
1990 and the Quality Housing and Work
Responsibility Act in 1998. Current
regulation addresses the minimum
program size separately for the Public
Housing FSS and the Section 8 FSS
programs; however, FSS funding
streams have been combined since the
Consolidated Appropriations Act, 2014,
Public Law 113–76, 128 Stat. 5, enacted
January 17, 2014. This unification of the
FSS program is further reflected in
section 306 of the Economic Growth
Act. The proposed rule revises the
provisions concerning the
determination of the minimum program
size to conform to the unified FSS
program. Specifically, the proposed rule
clarifies that when determining the
minimum program size (i.e., the
minimum number of families that a
PHA must serve in its FSS program), the
relevant figure is the total number of
Public Housing units plus the total
number of Section 8 units. The
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provisions concerning how to calculate
the reduction in the total number of
Public Housing units and Section 8
units over time, as used to determine
the minimum FSS program size, remain
the same. Therefore, the proposed rule
replaces the complex formula for
determining a PHA’s program size with
the language from the statute indicating
that a PHA’s program size must equal
the total number of families required to
be served as of May 24, 2018, as a
starting point.
PHAs should continue to use the
formula that HUD issued in its final rule
on March 5, 1996, 61 FR 8815,
consistent with the statutory
requirement that as of October 1, 1992,
the Secretary shall require PHAs that
administer assistance under subsection
(b) or (o) of 42 U.S.C. 1437f or makes
available new public housing dwelling
units, to carry out a local FSS program.
The proposed rule maintains
reference to the reduction of the
minimum program size in
§ 984.105(b)(2). Specifically, the
proposed rule revises that paragraph to
allow for a reduction of the minimum
program size by one slot for each family
that graduates from the FSS program,
from either rental assistance program
(Public Housing or Section 8) by
fulfilling its FSS CoP on or after October
21, 1998. This change conforms to
section 306 and to HUD’s
implementation of FSS alternative
requirements in the Waivers and
Alternative Requirements for the FSS
Program Federal Register Notice (79 FR
78100, December 29, 2014).
The proposed rule also conforms to
the list of local circumstances that make
it unfeasible for a PHA to operate an
FSS program and for which the PHA
may get HUD approval for an exception
to program operation or an exception to
operate a smaller program. HUD has
taken this opportunity to change the
duration of any HUD-approved
exception from 3three years to five
years. HUD proposes that an increase of
HUD-approved exceptions to five years
is a more reasonable timeframe and
provides for PHAs at the end of such
period, to restart the exception approval
process (if seeking to continue the
exception). Additionally, if
circumstances change within those five
years, PHAs are not required to carry
through the exception for the full five
years.
Question 2: HUD welcomes feedback
regarding this change. Specifically, do
commenters agree that five years is a
more reasonable duration for a HUDapproved exception? Or is there another
timeframe that would more accurately
balance changes in circumstances and
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the PHA’s administrative
responsibilities at the end of the
exception?
§ 984.106 Cooperative Agreements
Section 306 of the Economic Growth
Act provides that a PHA may enter into
a Cooperative Agreement with one or
more owners of multifamily properties
to voluntarily make an FSS program
available to the owner’s assisted tenants.
The PHA would manage the service
coordination for eligible families that
are covered under the Cooperative
Agreement. This new section would
provide that in addition to complying
with the rest of part 984, the PHA
administering the FSS program must do
so in accordance with the requirements
in this section. Those requirements are
as follows: (1) FSS program waiting lists
must be open to all eligible families
residing in the multifamily properties
covered by the Cooperative Agreement;
(2) escrow amounts must be managed by
each owner, including calculating and
tracking of the escrow must be done in
accordance with § 984.305; (3) an
owner’s assisted families covered by the
Cooperative Agreement may be part of
the calculation of the FSS award under
§§ 984.107 and 984.302; (4) FSS funds
awarded to the PHA may be used by the
PHA to serve an owner’s assisted
families covered by the Cooperative
Agreement; and (5) the Cooperative
Agreement must clearly specify the
terms and conditions of such agreement.
Question 3: HUD specifically requests
comments on whether this list is
comprehensive or if other items should
be required of PHAs and owners
entering into a Cooperative Agreement.
§ 984.107 FSS Award Funds Formula
Section 306 of the Economic Growth
Act provides the Secretary the authority
to award funds by formula and set forth
new procedures and processes. This
section incorporates the statutory
language providing that the Secretary
may establish a formula by which funds
for administration of the FSS program
are awarded and indicating any changes
to such formula, as permitted by statute,
are accomplished by notice in the
Federal Register.
§ 984.201 Action Plan
Technical revisions to the list of
parties who should be consulted in
developing an action plan and the
contents of the plan are included in this
section of the proposed rule, to conform
with the slight changes under section
306 of the Economic Growth Act.
Additionally, since all PHAs would
have already submitted an FSS Action
Plan, HUD has taken this opportunity to
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remove the reference to the initial
submission of an FSS Action Plan for
PHAs with mandatory programs. The
section also indicates that owners
operating a voluntary FSS program
would be required to have an approved
FSS Action Plan but distinguishes the
level of consultation required of PHAs
versus owners. This distinction, on FSS
requirements for owners in 24 CFR part
887, is discussed further below.
§ 984.202 Program Coordinating
Committee (PCC)
HUD takes this opportunity to revise
the provisions concerning required PCC
membership to streamline, simplify, and
unify such provisions. Specifically, the
proposed rule would continue to require
representatives from the participating
PHA to be members of the PCC and
require an FSS Coordinator or
Coordinators to be PCC members as
well. Additionally, the proposed rule
would require that at least one resident
participant from each HUD-assisted
program served by FSS is a member of
the PCC. PHAs would no longer be
required to formally solicit such
participants from the resident groups
identified in the regulation. Rather,
PHAs may seek such group’s assistance,
if needed, to identify such participants.
The provisions concerning
recommended membership in
§ 984.202(b)(2) and alternative
committees in § 984.202(c) have also
been revised to conform to changes
made in section 306 of the Economic
Growth Act. Specifically, reference to
the JOBS and JTPA programs have been
replaced with reference to programs
under the Workforce Innovation and
Opportunity Act. In addition, at least
one participant of each HUD-assisted
program served by FSS must be
consulted in determining whether to use
an existing entity as the PCC.
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§ 984.302 FSS Funds
This rule adds that a PHA or owner
may use FSS funds for costs associated
with families who are enrolled in an
FSS program under this part, including
through a Cooperative Agreement with
an owner of multifamily assisted
housing in accordance with § 984.106.
§ 984.303 Contract of Participation
The Economic Growth Act revises the
requirement that the Head of Household
(for rental assistance purposes) must be
the person to execute the Contract of
Participation (CoP). Instead, it allows
any adult member of the FSS family to
execute the CoP. The proposed rule
revises paragraph (a) to incorporate this
change and clarifies that an adult family
member, as designated by the FSS
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family in consultation with the PHA or
owner, is eligible to execute the
contract.
Question 4: While HUD has carefully
considered all areas of the regulation
that are impacted by this change, and
revised them accordingly, HUD requests
comment on whether there are other
places that such clarification should be
included.
The proposed rule revises the amount
of time a family must be independent
from welfare assistance prior to
expiration of the CoP, in § 984.303
(b)(2). Currently, one of the required
goals for a family is that it must be
independent from welfare assistance for
12 months before the expiration of the
FSS CoP. In this proposed rule, a family
must be independent from welfare at the
time of graduation from FSS but not
independent for a specified time period
prior to graduating from the FSS
program. This change would ensure that
an FSS family’s successful graduation,
and access to escrow funds, is not
jeopardized if they do not meet the 12month time period, if the family has
worked successfully towards all the
other goals. It also provides some
administrative relief to PHAs and
owners who would no longer have to
ensure that families have met the 12month time period. HUD welcomes
feedback regarding this change.
Specifically:
Question 5: Would commenters
recommend giving PHAs the discretion
to set a specified time period (up to a
maximum)? Is 12 months a reasonable
maximum? What are some of the
benefits and challenges PHAs face with
the current 12-month time period?
Question 6: How would requiring
families to be independent from welfare
for a specified time period link with
Temporary Assistance for Needy
Families (TANF) requirements? How
would it enhance or obstruct such
requirements?
Question X: Would removing the 12month requirement decrease the
incentive for participants to
permanently stay off welfare?
HUD adds language in paragraph
(b)(2) that the FSS family goals must
comply with the parameters of the FSS
terms and conditions as prescribed by
HUD, and the PHA or owner may not
modify or add additional required
activities that must be completed by
every participant. Specifically, HUD
requires that the CoP represent an
individualized training and service
plan, and, thus, PHAs and owners
should not require a certain number of
hours, rate of pay, or other mandatory
requirements that apply to all
participants across the board.
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Consistent with the change to
paragraph (a), paragraph (b)(4) is
changed to reflect that employment
must be maintained by the head of the
FSS family, not the Head of Household,
consistent with the statutory change
permitting participation in the FSS
program by any adult member of the
family. Also, as required by the
Economic Growth Act, HUD is deleting
§ 984.303(b)(5)(iii), which currently
indicates that the PHA could terminate
or withhold the family’s Section 8
assistance for non-compliance with the
COP. Eliminating the ability of a PHA to
terminate or withhold assistance is
expected to incentivize greater
participation in the FSS program. With
respect to 984.303(d), HUD proposes to
expand the definition of ‘‘good cause’’
for a contract extension in paragraph
(d), to include the active pursuit of a
goal that will further self-sufficiency,
such as a college degree or credit repair
program. Additionally, any extension of
the contract must be made pursuant to
a current or additional stated goal for
the FSS family.
Question 7: HUD requests comments
on whether this definition should be
clarified to include additional
circumstances, like serious illness or
involuntary loss of employment, which
are already causes for extension.
Paragraph (g) is amended to remove
the provision that automatically
completes the FSS contract when thirty
percent (30%) of the family’s adjusted
monthly income equals or exceeds the
Fair Market Rent (FMR). HUD believes
that the thirty percent (30%) provision
no longer aligns effectively with current
HCV requirements and creates
confusion among FSS coordinators and
partners. Removal of this provision
would allow FSS families to use the FSS
program to its full potential.
Question 8: HUD requests comments
on the removal of this automatic
completion provision; and, whether
there are circumstances where an FSS
contract should be automatically
completed.
The section has a new paragraph (k)
that discusses the nullification of a CoP.
Nullification would occur when the
PHA or owner determines that services
integral to an FSS family’s advancement
towards self-sufficiency are unavailable
or when the head of the FSS family
becomes permanently disabled and
unable to work or dies during the period
of the contract, unless the PHA or owner
and the FSS family determine that it is
possible to modify the contract to
designate a new head of the FSS family.
The new paragraph describes the
management of the escrow funds in the
case of nullification.
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Question 9: HUD requests comments
about the language added regarding the
handling of escrow funds in the case of
nullification.
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§ 984.304 Amount of Rent Paid by FSS
Family and Increases in Family Income
The proposed rule revises the
provision concerning increases in
family income. Prior to the Economic
Growth Act, an FSS family’s increases
in earned income during their
participation in FSS could not be
considered as income or a resource for
eligibility for other benefits, or amount
of benefits payable to the family, under
any HUD program, unless the family
income equaled or exceeded 80 percent
of the area median income. The
Economic Growth Act removes this last
provision and allows an FSS family’s
increases in earned income during their
participation in FSS to be excluded as
income or a resource regardless of
whether the family income equals or
exceeds 80 percent of the area median
income. Additionally, HUD streamlines
this section by removing a reference to
the calculation of rent for the rental
certificate participants because the
certificate program is obsolete and adds
the regulatory citations for calculation
of rent for the PBV program.
§ 984.305 FSS Account
Section 984.305(a)(2)(i) of the current
regulation requires that, during the term
of the FSS contract, the PHA credits the
escrow amount to each family’s FSS
account periodically but not less than
annually. The proposed rule revises and
clarifies the requirement by
differentiating between ‘‘determining
the FSS escrow amount’’ and ‘‘crediting
that FSS escrow amount’’ to a family’s
FSS account. Under the proposed
change, during the term of the CoP, the
PHA must determine the monthly
escrow credit amount at each
reexamination of income occurring after
the effective date of the CoP. That
amount is then deposited (i.e., credited)
every month into each family’s FSS
account. This change aligns the
calculation of the FSS escrow amount
with the timing of the family’s
reexamination of income and provides
the ability to report real-time
information on a family’s FSS account.
The requirement to provide an FSS
escrow account report to the family, at
least annually, has not changed;
however, a family may inquire about
their FSS escrow balance at any time.
Question 10: Is the proposed
frequency of depositing escrow amounts
to a family’s FSS account reasonable?
Should HUD consider another
frequency, and why?
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Question 11: Current regulations do
not address whether escrow should be
credited to a family’s FSS account if the
family does not pay rent on time. HUD
requests comments on whether the
family’s FSS account should be credited
for late payments. Please provide
comments both on regulation and on
how the regulation could be
implemented, especially in the case of
the voucher programs where rent is paid
to landlords and not directly to the
PHAs.
The proposed rule revises the
provision concerning reduction of
amounts due by the FSS family under
paragraph (a)(2)(iii) of this section.
Under current regulation, the balance on
a family’s FSS escrow account must be
reduced before prorating the interest
income, by amounts not paid by the
family for rent, or any other amounts
due by the family under the applicable
housing program. Such amounts are also
reduced from a family’s FSS escrow
balance at the time of final escrow
disbursement. The proposed rule no
longer requires that the balance on a
family’s escrow account be reduced by
these amounts each time interest
income is prorated. Instead, the total
balance on a family’s FSS escrow
account (including interest accrued over
the life of the escrow account) is
reduced by such amounts only at the
time of final escrow disbursement in
accordance with § 984.305(c). HUD
believes that the regulation
appropriately addresses amounts due by
the family by adjusting the family’s FSS
escrow balance only at the time of final
escrow disbursement. This change also
streamlines management of the FSS
escrow account and provides
administrative relief to FSS PHAs and
owners.
HUD is proposing to address the
requirements concerning updating
income information prior to the
execution of an FSS CoP. Current FSS
regulations do not address this
requirement; however, the FSS CoP
(form HUD–52650) requires PHAs to
conduct an income recertification if
more than 120 days have passed
between the effective date of the last
income recertification and the effective
date of the CoP. HUD believes this is
best left to PHA/owner discretion and is
adding language to § 984.305(b)(1) to
explicitly afford PHAs and owners
discretion to decide whether to conduct
a new income recertification if more
time than the period specified by the
PHA or owner has passed between the
effective date of the last income
recertification and the effective date of
the CoP.
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Question 12: While HUD recognizes
that owners would not have the same
flexibility that PHAs have for this type
of income recertification, HUD requests
comments from the public as to whether
this should be available to multifamily
owners as it is for PHAs.
Pursuant to the Economic Growth
Act, § 984.305(b) is revised to update
the calculation of the escrow amount
and to remove any language that does
not conform with the Act. Specifically,
the statute, and the proposed rule,
removes any difference in the
calculation of escrow between very lowincome and low-income families. HUD
has also taken the opportunity to further
update and streamline the escrow
calculation. The proposed rule no
longer differentiates in how family rent
is defined for the Public Housing and
the HCV programs. Instead, the
proposed rule adds a new set of
definitions, as described in § 984.103 of
this preamble, to provide further clarity
to the process of calculating the escrow
credit. The proposed rule changes the
calculation of escrow to the lower of: (i)
Thirty (30) percent of one-twelfth (1/12)
(i.e., two and a half (2.5) percent) of the
amount by which the family’s current
annual earned income exceeds the
family’s baseline annual earned income;
or (ii) the amount by which the family’s
rent has increased. This calculation
ensures that the FSS escrow credit is
limited to increases in the amount of
rent paid by the family that is
attributable to increases in earned
income. In the first part of the
calculation, one-twelfth is used to
calculate the growth in monthly, instead
of annual, earned income, and 30
percent is used because that’s the
percentage of adjusted income generally
used to determine the family’s monthly
rent.
The second part of the calculation,
which looks at increases in the family’s
rent, uses the lower of: (A) The amount
by which the family’s current monthly
rent exceeds the family’s baseline
monthly rent; (B) for HCV families, the
difference between the baseline monthly
rent and the current gross rent (i.e., rent
to owner plus any utility allowance) or
the payment standard, whichever is
lower; or (C) for PBV families, the
difference between the baseline monthly
rent and the current gross rent (i.e., rent
to owner plus any utility allowance).
This ensures that families are not
escrowing more than the current gross
rent for the unit (i.e., rent to owner plus
any utility allowance) or the payment
standard (for HCV families). And, it
more accurately applies HCV and PBV
rent rules to the calculation of escrow.
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Federal Register / Vol. 85, No. 183 / Monday, September 21, 2020 / Proposed Rules
To put it another way: If a family has
no change in earned income, but rent
does go up for whatever reason (flat rent
is recalculated, a non-income-based rent
increase kicks in, an income disregard
ends, increase in non-earned income,
decrease in deductions, etc.), the
paragraph (i) calculation will be lower.
Or, a family has a change in earned
income, but rent does NOT go up (due
to flat rent, ceiling rent, income
disregard, or some other non-incomebased rent model) then the paragraph
(ii) calculation will be lower.
HUD will update the current FSS
escrow calculation worksheet applicable
to HCV and Public Housing families to
conform with the regulatory changes
and to provide further clarity. HUD has
made available a copy of the revised
worksheet with this proposed rule in
Appendix A. To review and test the
proposed Sample FSS Escrow
Calculation Worksheet, please find on
the HUD FSS web page: https://
www.hud.gov/program_offices/public_
indian_housing/programs/hcv/fss.
Please submit comments on the
proposed worksheet using the same
process as commenting on the Proposed
Rule. The Housing office will be
creating a similar calculation worksheet
that reflects any differences in escrow
calculation in the multifamily program.
Question 13: Does the streamlined
escrow calculation, as reflected in the
regulation and the revised escrow
calculation form, effectively simplify
the calculation of escrow? Are there
elements of the calculation that should
be done differently? This includes how
to address alternatives to income-based
rents and any other specific situations
you may encounter at your PHA. If so,
why and how? For PBRA Owners—
please comment on any sections of the
escrow calculation worksheet that
should be modified for PBRA FSS
participants. Please submit proposed
edits to the form if needed.
Section 984.305(b)(4) is also revised
to address the impact on escrow for
HCV families who are in the process of
moving to a new unit, in accordance
with HCV program requirements, and
that are not under a lease during that
time. Specifically, § 984.305(b)(4) is
revised to clarify that escrow credits
cease during the HCV family’s search
period if the family is not under a lease.
Escrow credits resume once the family
finds a unit and enters into a lease. HUD
interprets the FSS statute as requiring
the payment of rent by a family in
calculating the amount of the family’s
escrow credit. Similarly, the FSS statute
provides that an eligible entity may use
funds it controls under section 8 for
purposes of making the escrow deposit
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for participating families, if those funds
are offset by the increase in the amount
of rent paid by the family. Such an
offset would not be possible if the
family is not under a lease and,
consequently, not paying rent.
Section 984.305(f) currently provides
that escrow funds are forfeited when the
FSS contract is nullified under
§ 984.303(e), in cases where supportive
services integral to the FSS family are
unavailable to the FSS family. HUD
proposes to change the policy and allow
escrow funds to be disbursed to the FSS
family in the case of a nullified contract.
HUD believes that disbursement of
escrow funds is justified because
nullification of the CoP under these
circumstances is at no fault of the
family. Paragraph (c)(3) has been added
to address this change and paragraph (f)
has been modified to remove reference
to forfeiture of escrow for nullified
contracts.
Paragraph (f) is amended to conform
with the statutory change under the
Economic Growth Act, which provides
that forfeited FSS escrow funds must be
used for the benefit of FSS participants
in good standing. The section provides
the following list of activities for which
forfeited escrow funds may be used:
Support for FSS participants in good
standing; training for program
coordinators; and, other eligible
activities as determined by the
Secretary. A list of ineligible uses will
be included.
Question 14: HUD requests comment
on what definition should apply for
‘‘participants in good standing’’ and
whether HUD should add items to the
eligible activities list for which forfeited
escrow funds may be used?
§ 984.306 HCV Portability
Requirements
HUD has taken this opportunity to
change several provisions concerning
FSS families that move with continued
HCV assistance from the jurisdiction of
one PHA to the jurisdiction of another
PHA under portability. This section of
the proposed rule seeks to carefully
balance the complexities of a portability
move, the shared FSS responsibilities
between PHAs, and giving the FSS
family that ports the best opportunity to
successfully complete the FSS program.
In addition to the changes described in
the following paragraphs, editorial
changes have been made to this section
for clarity.
Under the current FSS regulation, a
receiving PHA may, at its discretion,
enroll into its FSS program an FSS
family that ports into its jurisdiction.
And, the initial PHA may determine
that an FSS family that ports may
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59239
continue to participate in the initial
PHA’s FSS program, if the FSS family
demonstrates to the satisfaction of the
initial PHA that the family will be able
to fulfill its responsibilities under the
FSS contract. The proposed rule revises
this framework, by instead requiring
that the receiving PHA enroll into its
FSS program FSS families that port,
unless the receiving PHA and the initial
PHA agree to the family’s continued
participation in the initial PHA’s FSS
program. This change facilitates the
continuity of services and case
management to the family, it facilitates
the family’s move, and it prevents the
potential loss of escrow funds. The
change also recognizes that each PHA
retains responsibility for certain FSS
tasks after a portability move; therefore,
receiving PHAs should have input on
whether the family may continue to
participate in the initial PHA’s FSS
program. Additionally, since this
change is only applicable to families
that were already enrolled in FSS prior
to the portability move, HUD expects
that this change will only impact a
small number of families and PHAs.
The proposed rule addresses a
scenario, not previously addressed in
the regulation, in which a relocating
FSS family moves to a receiving PHA
that does not administer an FSS
program. Under the proposed rule,
continued FSS participation under this
scenario is not possible. The proposed
rule recognizes that there may be several
options (for example, modification of
the FSS contract to graduate the family,
termination of the FSS contract and
forfeiture of escrow, or locating a
receiving PHA that administers an FSS
program) available to the family and
requires that the initial PHA discuss
those options with the family for them
to make a fully informed decision.
Continued FSS participation under
these circumstances is not possible
because the receiving PHA would be
responsible for certain FSS tasks after
the move (even if the family continues
to participate in the initial PHA’s FSS
program), and it would be burdensome
to require a receiving PHA to manage
such tasks for a small number of FSS
families, especially in light of the
administrative complexity of a
portability move, which would be
further complicated by the shared FSS
responsibilities between PHAs.
Another situation not previously
addressed in the regulation is also
addressed in the proposed rule. That is,
when a family who was not enrolled in
FSS before the move requests
enrollment in the receiving PHA’s FSS
program. The proposed rule states that
if the receiving PHA, at their discretion,
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absorbs the family into its HCV
program, the receiving PHA may, also at
their discretion, enroll the family into
its FSS program. Receiving PHAs must
consistently apply their existing FSS
enrollment policies to families who
have ported into their jurisdiction and
request to enroll in the receiving PHA’s
FSS program. If the receiving PHA will
bill the initial PHA for the housing
assistance payments, the family cannot
enroll in the receiving PHA’s FSS
program. This restriction recognizes, as
mentioned previously, the
administrative complexity of a
portability move may be further
complicated by the shared FSS
responsibilities between PHAs, and the
potential inefficiencies in the
administration of the FSS contract.
Question 15: HUD requests comment
on these proposed changes and
additions to the FSS portability
provisions and whether there are more
effective ways to address the balance
between the administrative complexity
for the PHA and the family’s desire to
participate in FSS.
§ 984.401 Reporting
The reporting section is amended to
reflect the statutory requirement that
reports include the number of families
enrolled and graduated, and the number
of established escrow accounts and
positive escrow balances.
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Multifamily Housing FSS Program
The Multifamily Housing FSS
program’s new subpart has eight
sections that mirror the FSS program in
24 CFR part 984. The sections are listed
as the following:
§ 887.101 Purpose, Scope, and
Applicability
This section provides for the purpose,
scope, applicability, and provision on
tenant nonparticipation. Consistent with
24 CFR part 984, the purpose of the FSS
program for multifamily owners is the
same as for PHAs, to promote the
development of local strategies to
coordinate the use of HUD assistance
with public and private resources and to
enable families eligible to receive HUD
assistance to achieve economic
independence and self-sufficiency. The
new 24 CFR part 887 regulations
provide the requirements that an owner
must follow if the owner decides to
implement an FSS program
independently or by way of a
Cooperative Agreement with a PHA or
another owner. The new 24 CFR part
887 regulations are not applicable to
PHAs that must follow 24 CFR part 984.
Lastly, the section provides that tenant
participation in an FSS program is
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voluntary, and an owner must not delay
or terminate assistance under Section 8
for a family that elects not to participate
in an FSS program.
§ 887.103 Definitions
The definitions for multifamily
assisted housing are the same as those
for PHAs in § 984.103, except that
eligible families in 24 CFR part 887
means tenants of multifamily assisted
housing.
§ 887.105 Basic Requirements for FSS
Program
HUD implemented a voluntary FSS
program for multifamily assisted
housing through notice H 2016–08; the
notice incorporated many of the
provisions of 24 CFR part 984. For
consistency among voluntary FSS
programs, HUD proposes to make the
FSS program requirements for
multifamily assisted housing consistent
with PHA requirements. These
requirements will apply to both existing
and new FSS programs. Specifically, an
FSS program would be required to
operate in conformity with the
regulations of 24 CFR part 887 and other
Section 8 regulations, as applicable.
Those 24 CFR part 984 requirements are
as follows: (1) Coordination of
supportive services as defined in
§ 984.103; (2) creation of an approved
Action Plan, as described in § 984.201,
before operating an FSS program; (3)
handling FSS funds consistent with
§ 984.302; (4) entering into a CoP with
eligible families, § 984.303; (5)
management of escrow accounts, as
described in § 984.305; reporting
information pursuant to § 984.401; and
(6) operated in compliance with the
nondiscrimination and equal
opportunity requirements set forth in 24
CFR part 5. This section provides as
follows: (1) Owners are permitted to
make available and utilize onsite
facilities, as set forth in § 984.204; and
(2) owners may employ appropriate
staff, including a program coordinator to
administer its FSS program, and may
contract with an appropriate
organization to establish and administer
parts of the FSS program as provided by
§ 984.305.
The section requires consultation
with a Program Coordinating Committee
(PCC) in creating an Action Plan, but it
does not require the creation of a PCC
under § 984.202. The multifamily
assisted housing regulation does not
include minimum program size
requirements at § 984.105 since FSS
programs are voluntary; the formula
award section applying only to
mandatory programs at § 984.107; the
family selection process at § 984.203;
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and the portability requirements at
§ 984.306. All other provisions are
adopted either in part or in whole in its
application to multifamily assisted
housing.
Question 16: HUD specifically asks
for comments on whether the exclusion
or inclusion of certain requirements for
the multifamily assisted housing
regulation is appropriate. Specifically,
HUD excluded the family selection
process at § 984.203 because HUD does
not believe those requirements would be
necessary due to the size of most
multifamily assisted housing FSS
programs. Additionally, HUD excluded
the creation of a PCC because it was not
statutorily required for owners in the
FSS statute, but HUD does believe that
coordination with some of the members
of a PCC is essential in developing an
Action Plan and successfully
implementing an FSS program.
§ 887.107 Cooperative Agreements
Section 306 of the Economic Growth
Act provides that owners may enter into
Cooperative Agreements with a PHA or
other owner to offer an FSS program to
their tenants. An owner entering into a
Cooperative Agreement with a PHA
must follow the requirements provided
in § 984.106. An owner entering into a
Cooperative Agreement with another
owner must do so in accordance with
the requirements in this section. The
requirements are as follows: (1) Waiting
lists must be open to all eligible families
residing in the properties covered by the
Cooperative Agreement; (2) provide that
escrow amounts are handled by each
owner and the calculating and tracking
of escrow must be done in accordance
with § 984.305; and (3) the Cooperative
Agreement must clearly specify the
terms and conditions of such agreement.
Question 17: HUD specifically
requests comments on whether this list
is comprehensive or if other items
should be required of owners entering
into a Cooperative Agreement.
§ 887.109 Housing Assistance and
Total Tenant Payment and Increases in
Family Income
This section mirrors § 984.304 and
provides that housing assistance
payments for FSS families are the same
as those provided to any other tenant
living in the property. Paragraph (b)
provides the process for determining
total tenant payment. Paragraph (c)
provides that when an FSS family’s
income increases during its
participation in an FSS program, the
increase may not be considered as
income or a resource for purposes of
eligibility of the FSS family for other
benefits, or amount of benefits payable
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to the FSS family, under any other
program administered by HUD. For
multifamily assisted housing, money
that goes into escrow is offset by
additional housing assistance payment
(HAP) to the owner from HUD as a
positive adjustment to the monthly
voucher.
§ 887.111 FSS Award Funds Formula
Section 306 of the Economic Growth
Act provides the Secretary the authority
to award funds by formula and set forth
new procedures and processes. This
section incorporates the statutory
language providing that the Secretary
may establish a formula by which funds
for administration of the FSS program
are awarded and indicating any changes
to such formula, as permitted by statute,
are accomplished by notice in the
Federal Register. This section mirrors
§ 984.107.
IV. Findings and Certifications
Regulatory Review—Executive Orders
12866 and 13563
Executive Orders 12866 and 13563
direct agencies to assess all costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health, and safety
effects; distributive impacts; and
equity). Executive Order 13563
emphasizes the importance of
quantifying both costs and benefits,
reducing costs, harmonizing rules, and
promoting flexibility.
Under Executive Order 12866
(Regulatory Planning and Review), a
determination must be made whether a
regulatory action is significant and;
therefore, subject to review by the Office
of Management and Budget (OMB), in
accordance with the requirements of the
order. This rule was determined to be a
‘‘significant regulatory action’’ as
defined in section 3(f) of the Executive
Order, but not an economically
significant regulatory action, as
provided under section 3(f)(1) of
Executive Order 12866. Consistent with
Executive Order 13563, this rule
implements the streamlining
requirements of section 306 and
provides additional flexibility for PHAs
and multifamily owners. HUD has
prepared an initial Regulatory Impact
Analysis (RIA) that addresses the costs
and benefits of the proposed rule.
HUD’s RIA is part of the docket file for
this rule.
The docket file is available for public
inspection in the Regulations Division,
Office of General Counsel, Room 10276,
451 7th Street SW, Washington, DC
20410–0500. Due to security measures
at the HUD Headquarters building,
please schedule an appointment to
review the docket file by calling the
Regulations Division at 202–402–3055
(this is not a toll-free number).
Individuals with speech or hearing
impairments may access this number
via TTY by calling the Federal Relay
Service at toll-free 800–877–8339.
Executive Order 13771
Executive Order 13771, entitled
‘‘Reducing Regulation and Controlling
Regulatory Costs,’’ was issued on
January 30, 2017. Section 2(a) of
Executive Order 13771 requires an
Number of
responses
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Description of information collection
SF–424—Application for Federal Assistance ......................
SF–LLL—Disclosure of Lobbying Activities .........................
Form HUD 2880—Applicant, Recipient, Disclosure, Update Form (OMB No. 2510–0011) 3 .................................
NOFA Narrative ...................................................................
Cooperative Agreements .....................................................
Form HUD–52755—Sample Contract Admin. Partnership
Agreement ........................................................................
Form HUD–2994–A You are Our Client (Optional Survey)
(OMB No: 2535–0116) .....................................................
Form HUD–52651—FSS Application ..................................
Action Plan ...........................................................................
Form HUD–52650—Contract of Participation .....................
Form HUD–52652—Escrow Account Credit Worksheet .....
Form HUD–1044—Grant Agreement * ................................
Annual Report (Narrative)/Performance Report ..................
Form HUD–50058—Family Report (OMB No. 2577–0083)
Total ..............................................................................
Responses
per year
59241
Agency, unless prohibited by law, to
identify at least two existing regulations
to be repealed when the Agency
publicly proposes for notice and
comment or otherwise promulgates a
new regulation. In furtherance of this
requirement, section 2(c) of Executive
Order 13771 requires that the new
incremental costs associated with new
regulations shall, to the extent permitted
by law, be offset by the elimination of
existing costs associated with at least
two prior regulations. For the reasons
discussed in the Regulatory Impact
Analysis, this proposed rule has been
determined to be an Executive Order
13771 deregulatory action.
Paperwork Reduction Act
In accordance with the Paperwork
Reduction Act of 1995 (44 U.S.C. 3501–
3520), an agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless the collection displays a valid
control number. The information
collection requirements contained in
this proposed rule have been submitted
to the Office of Management and Budget
(OMB) under the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501–3520) and
assigned OMB control number 2577–
0178.
The proposed rule would require
changes to the existing approved
paperwork to include multifamily,
addition of a Notice of Funding
Availability (NOFA) narrative, and the
Cooperative Agreement. The overall
reporting and recordkeeping burden are
estimated as follows:
Total annual
responses
Hours per
response
Total hours
750
40
1
1
750
40
0.75
0.17
563
7
800
20
15
1
1
1
800
20
15
0
10
2
0
200
30
20
1
20
0.17
3
50
800
73
1,000
600
700
775
900
1
1
1
10
90
1
1
50
50
800
10
10,000
54,000
250
775
45,000
0
1.5
10
.25
.85
N/A
1
0
0
1,200
730
2,500
45,900
N/A
775
0
........................
........................
........................
26.69
51,908
*HUD–1044, Award/Amendment is completed by HUD staff, signed by the recipient of the grant, and returned to HUD. This form is a certification and HUD ascribes no burden to its use.
3 Burden hours for forms showing zero burden
hours in this collection are reflected in the OMB
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approval number cited or do not have a reportable
burden.
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Federal Register / Vol. 85, No. 183 / Monday, September 21, 2020 / Proposed Rules
In accordance with 5 CFR
1320.8(d)(1), HUD is soliciting
comments from members of the public
and affected agencies concerning the
information collection requirements in
the proposed rule regarding:
(1) Whether the proposed collection
of information is necessary for the
proper performance of the functions of
the agency, including whether the
information will have practical utility;
(2) The accuracy of the agency’s
estimate of the burden of the proposed
collection of information;
(3) Whether the proposed collection
of information enhances the quality,
utility, and clarity of the information to
be collected; and
(4) Whether the proposed information
collection minimizes the burden of the
collection of information on those who
are to respond; including through the
use of appropriate automated collection
techniques or other forms of information
technology (e.g., permitting electronic
submission of responses).
Interested persons are invited to
submit comments regarding the
information collection requirements in
this rule. The proposed information
collection requirements in this rule have
been submitted to OMB for review
under section 3507(d) of the Paperwork
Reduction Act. Under the provisions of
5 CFR part 1320, OMB is required to
make a decision concerning this
collection of information between 30
and 60 days after the publication date.
Therefore, a comment on the
information collection requirements is
best assured of having its full effect if
OMB receives the comment within 30
days of the publication. This time frame
does not affect the deadline for
comments to the agency on the
proposed rule. Comments must refer to
the proposed rule by name and docket
number (FR–6085) and must be sent to:
HUD Desk Officer, Office of
Management and Budget, New
Executive Office Building,
Washington, DC 20503, Fax number:
202–395–6947
and
Colette Pollard, HUD Reports Liaison
Officer, U.S. Department of Housing
and Urban Development, 451 7th
Street SW, Room 2204, Washington,
DC 20410
Interested persons may submit
comments regarding the information
collection requirements 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
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prepare and submit a comment, ensures
timely receipt by HUD, and enables
HUD to make them 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 the
instructions provided on that site to
submit comments electronically.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104–4;
approved March 22, 1995) (UMRA)
establishes requirements for Federal
agencies to assess the effects of their
regulatory actions on State, local, and
tribal governments, and on the private
sector. This rule does not impose any
Federal mandates on any State, local, or
tribal government, or on the private
sector, within the meaning of the
UMRA.
Environmental Review
A Finding of No Significant Impact
with respect to the environment has
been made in accordance with HUD
regulations in 24 CFR part 50 that
implement section 102(2)(C) of the
National Environmental Policy Act of
1969 (42 U.S.C. 4332(2)(C)). The
Finding is available for public
inspection during regular business
hours in the Regulations Division,
Office of General Counsel, U.S.
Department of Housing and Urban
Development, 451 Seventh Street SW,
Room 10276, Washington, DC 20410–
0500. Due to security measures at the
HUD Headquarters building, please
schedule an appointment to review the
Finding by calling the Regulations
Division at 202–402–3055 (this is not a
toll-free number). Individuals with
speech or hearing impairments may
access this number via TTY by calling
the Federal Information Relay Service at
800–877–8339.
Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA)
(5 U.S.C. 601 et seq.) generally requires
an agency to conduct a regulatory
flexibility analysis of any rule subject to
notice and comment rulemaking
requirements unless the agency certifies
that the rule will not have a significant
economic impact on a substantial
number of small entities. As has been
discussed in this preamble, this rule
proposes to make changes to HUD’s
regulations to implement the Section
306 statutory changes and streamline
other requirements. HUD believes this
rule will overall reduce burden,
including for small PHAs and
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multifamily owners. The burden
reduction anticipated is more fully
discussed in the accompanying
Regulatory Impact Assessment (RIA).
For these reasons, HUD has determined
that this rule would not have a
significant economic impact on a
substantial number of small entities.
Notwithstanding HUD’s determination
that this rule will not have a significant
effect on a substantial number of small
entities, HUD specifically invites
comments regarding any less
burdensome alternatives to this rule that
will meet HUD’s objectives as described
in this preamble.
Executive Order 13132, Federalism
Executive Order 13132 (entitled
‘‘Federalism’’) prohibits an agency from
publishing any rule that has federalism
implications if the rule either: (1)
Imposes substantial direct compliance
costs on State and local governments
and is not required by statute, or (2)
preempts State law, unless the agency
meets the consultation and funding
requirements of section 6 of the
Executive Order. This proposed rule
does not have federalism implications
and does not impose substantial direct
compliance costs on State and local
governments nor preempt State law
within the meaning of the Executive
Order.
List of Subjects
24 CFR Part 887
Grant programs-housing and
community development, Public
housing, Rent subsidies, Reporting and
recordkeeping requirements.
24 CFR Part 984
Grant programs-housing and
community development, Grant
programs-Indians, Indians, Public
housing, Rent subsidies, Reporting and
recordkeeping requirements.
Accordingly, for the reasons stated in
the preamble, HUD proposes to amend
24 CFR chapters VIII and IX as follows:
■ 1. Add part 887 to read as follows:
PART 887—SECTION 8 HOUSING
ASSISTANCE PAYMENTS
PROGRAMS—FAMILY SELFSUFFICIENCY PROGRAM
Sec.
887.101 Purpose, scope, and applicability.
887.103 Definitions.
887.105 Basic requirements of FSS.
887.107 Cooperative agreements.
887.109 Housing assistance and total tenant
payments and increases in family
income.
887.111 FSS Award Funds Formula.
Authority: 42 U.S.C. 1437u, and 3535(d).
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§ 887.101 Purpose, scope, and
applicability.
(a) Purpose. (1) The purpose of the
Family Self-Sufficiency (FSS) Program
is to promote the development of local
strategies to coordinate the use of HUD
assistance with public and private
resources, to enable families eligible to
receive HUD assistance to achieve
economic independence and selfsufficiency.
(2) The purpose of this part is to
implement the policies and procedures
applicable to operation of an FSS
program under HUD’s Section 8
Housing assistance payments programs,
as established under section 23 of the
1937 Act (42 U.S.C. 1437u).
(b) Scope. Each owner may
implement an FSS program
independently or by way of a
Cooperative Agreement with a Public
Housing Agency (PHA) or another
owner. Each owner that administers an
FSS program must do so in accordance
with the requirements of this part.
(c) Applicability. This part applies to
owners of multifamily rental housing
properties assisted by Section 8 Housing
assistance payments programs. See part
984 of this title for program regulations
applicable to PHAs.
(d) Nonparticipation. Tenant
participation in an FSS program is
voluntary. Assistance under Section 8
Housing assistance payments programs
for a family that elects not to participate
in an FSS program shall not be delayed
or terminated by reason of such
election.
§ 887.103
Definitions.
The definitions in 24 CFR 984.103
apply to this part, except that eligible
families means tenant families living in
multifamily assisted housing.
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§ 887.105
Basic requirements of FSS.
(a) An FSS program that is voluntarily
established under this part by an owner
must comply with the following
requirements:
(1) Shall be operated in conformity
with the regulations of this part and
other Section 8 regulations, codified in
24 CFR parts 5, 402, 880, 881, 883, and
884, respectively, and with FSS program
objectives, as described in § 984.102;
(2) Shall coordinate supportive
services as defined in § 984.103;
(3) Shall have an Action Plan
approved by HUD, as described in
§ 984.201, before operating an FSS
program;
(4) Shall work with a Program
Coordinating Committee (PCC), as
described in § 984.202, when available;
(5) May make available and utilize
onsite facilities, as described in
§ 984.204;
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(6) Shall comply with the FSS funds
provision, as described in § 984.302;
(7) Shall enter into Contracts of
Participation with eligible families, as
described in § 984.303;
(8) Shall establish and manage FSS
accounts as described in § 984.305;
(9) Shall report information to HUD as
described in § 984.401;
(10) Shall be operated in compliance
with the nondiscrimination and equal
opportunity requirements set forth in 24
CFR part 5.
(b) An owner may employ appropriate
staff, including a program coordinator to
administer its FSS program, and may
contract with an appropriate
organization to establish and administer
parts of the FSS program.
§ 887.107
Cooperative agreements.
(a) An owner may enter into a
Cooperative Agreement with:
(1) A local PHA that operates an FSS
program, pursuant to § 984.106; or
(2) Another owner that operates an
FSS program, pursuant to this section.
(b) Owners that enter into a
Cooperative Agreement pursuant to this
subpart, must:
(1) Open any FSS waiting lists to all
eligible families residing in the
properties covered by the Cooperative
Agreement.
(2) Provide periodic escrow amounts
to the program coordinator for FSS
families covered by the Cooperative
Agreement under this subpart. The
Cooperative Agreement must provide
that each owner is responsible for
managing the escrow accounts of their
participating families, including
calculating and tracking of escrow in
accordance with § 984.305, and set forth
the procedures for the sharing of escrow
information between the PHA and the
owner.
(3) The Cooperative Agreement must
clearly specify the terms and conditions
of such agreement, including the
requirements of this subsection.
§ 887.109 Housing assistance and total
tenant payments and increases in family
income.
(a) Housing assistance payment. The
housing assistance payment for an
eligible family participating in the FSS
program under this part is determined
in accordance with the regulations set
forth in § 5.661(e).
(b) Total tenant payment. The total
tenant payment for an FSS family
participating in the FSS program is
determined in accordance with § 5.628
of this title.
(c) Increases in FSS family income.
Any increase in the earned income of an
FSS family during its participation in an
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59243
FSS program may not be considered as
income or a resource for purposes of
eligibility of the FSS family for other
benefits, or amount of benefits payable
to the FSS family, under any other
program administered by HUD.
§ 887.111
FSS Award Funds Formula.
The Secretary may establish a formula
by which funds for administration of the
FSS program are awarded consistent
with 42 U.S.C. 1437u(i). Notice of, and
changes to, such formula will be
published in the Federal Register.
■ 2. Revise part 984 to read as follows:
PART 984—SECTION 8 AND PUBLIC
HOUSING FAMILY SELF-SUFFICIENCY
PROGRAM
Subpart A—General
Sec.
984.101 Purpose, applicability, and scope.
984.102 Program objectives.
984.103 Definitions.
984.104 Basic requirements of the FSS
Program.
984.105 Minimum program size.
984.106 Cooperative agreements.
984.107 FSS Award Funds Formula.
Subpart B—Program Development and
Approval Procedures
984.201 Action Plan.
984.202 Program Coordinating Committee
(PCC).
984.203 FSS family selection procedures.
984.204 On-site facilities.
Subpart C—Program Operations
984.301 Program implementation.
984.302 FSS funds.
984.303 Contract of Participation (CoP).
984.304 Amount of rent paid by FSS family
and increases in family income.
984.305 FSS account.
984.306 HCV portability requirements.
Subpart D—Reporting
984.401 Reporting.
Authority: 42 U.S.C. 1437f, 1437u, and
3535(d).
Subpart A—General
§ 984.101
scope.
Purpose, applicability, and
(a) Purpose. (1) The purpose of the
Family Self-Sufficiency (FSS) Program
is to promote the development of local
strategies to coordinate the use of HUD
assistance with public and private
resources, to enable families eligible to
receive HUD assistance to achieve
economic independence and selfsufficiency.
(2) The purpose of this part is to
implement the policies and procedures
applicable to operation of an FSS
program, as established under section
23 of the 1937 Act (42 U.S.C. 1437u),
under HUD’s public housing assistance
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and housing assistance under Section
8(o) programs.
(b) Applicability. This part applies to
PHAs administering either or both a
public housing program under section 9
and a project-based and/or tenant-based
assistance program under section 8(o) of
the U.S. Housing Act of 1937. See 24
CFR part 887 for program regulations
applicable to owners of multifamily
assisted housing.
(c) Scope. Each PHA that administers
an FSS program must do so in
accordance with the requirements of
this part. See § 984.105 for more
information concerning PHAs that are
required to administer an FSS program.
(d) Nonparticipation. Participation in
an FSS program is voluntary. A family’s
admission to the public housing or
Section 8 programs cannot be
conditioned on participation in FSS. A
family’s housing assistance cannot be
terminated by reason of such election.
§ 984.102
Program objectives.
The objective of the FSS program is to
reduce the dependency of low-income
families on welfare assistance and
housing subsidies. Under the FSS
program, HUD assisted families are
provided opportunities for education,
job training, counseling, and other forms
of social service assistance, while living
in assisted housing, so that they may
obtain the education, employment, and
business and social skills necessary to
achieve self-sufficiency, as defined in
§ 984.103. The Department will evaluate
the performance of a local FSS program
using a scoring system that measures
criteria such as graduation from the
program, increased earned income and
program participation, as provided by
HUD through a Federal Register notice.
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§ 984.103
Definitions.
(a) The terms 1937 Act, Fair Market
Rent, HUD, Low income family, Public
Housing, Public Housing Agency (PHA),
Secretary, and Section 8, as used in this
part, are defined in Part 5 of this title.
(b) As used in this part:
Baseline annual earned income
means, for purposes of determining the
FSS credit under § 984.305(b), the FSS
family’s total annual earned income
from wages and business income (if any)
as of the effective date of the FSS
contract. In calculating baseline annual
earned income, all applicable
exclusions of income must be applied,
except for any disregard of earnings
associated with self-sufficiency
incentives that may be applicable to the
determination of annual income.
Baseline monthly rent means, for
purposes of determining the FSS credit
under § 984.305(b):
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(i) The FSS family’s total tenant
payment (TTP), as of the effective date
of the FSS contract, for families paying
an income-based rent as of the effective
date of the FSS contract; or
(ii) The amount of the flat or ceiling
rent (which includes the applicable
utility allowance), and including any
hardship discounts, as of the effective
date of the FSS contract, for families
paying a flat or ceiling rent as of the
effective date of the FSS contract.
Certification means a written
assertion based on supporting evidence,
provided by the FSS family or the PHA
or owner, as may be required under this
part, and which:
(i) Shall be maintained by the PHA or
owner in the case of the family’s
certification, or by HUD in the case of
the PHA’s or owner’s certification;
(ii) Shall be made available for
inspection by HUD, the PHA or owner,
and the public, as appropriate; and,
(iii) Shall be deemed to be accurate
for purposes of this part, unless the
Secretary or the PHA or owner, as
applicable, determines otherwise after
inspecting the evidence and providing
due notice and opportunity for
comment.
Chief Executive Officer (CEO). The
CEO of a unit of general local
government means the elected official or
the legally designated official, who has
the primary responsibility for the
conduct of that entity’s governmental
affairs.
Contract of Participation (CoP)
means—a contract, in a form approved
by HUD, entered into between an FSS
family and a PHA or owner operating an
FSS program that sets forth the terms
and conditions governing participation
in the FSS program. The CoP includes
all Individual Training and Services
Plans (ITSPs) entered into between the
PHA or owner and all members of the
family who will participate in the FSS
program, and which plans are attached
to the CoP as exhibits. For additional
detail, see § 984.303.
Current annual earned income means,
for purposes of determining the FSS
credit under § 984.305(b), the FSS
family’s total annual earned income
from wages and business income (if any)
as of the most recent reexamination of
income which occurs after the effective
date of the FSS contract. In calculating
current annual earnings, all applicable
exclusions of income will apply,
including any disregard of earnings
associated with self-sufficiency
incentives or other alternative rent
structures that may be applicable to the
determination of annual income.
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Current monthly rent means, for
purposes of determining the FSS credit
under § 984.305(b):
(i) The FSS family’s TTP as of the
most recent reexamination of income,
which occurs after the effective date of
the FSS contract, for families paying an
income-based rent as of the most recent
reexamination of income; or
(ii) The amount of the flat rent,
(which includes the applicable utility
allowance), or ceiling rent and
including any hardship discounts, as of
the most recent reexamination of
income which occurs after the effective
date of the FSS contract, for families
paying a flat rent or ceiling rent as of the
most recent reexamination of income.
Earned income means income or
earnings included in annual income
from wages, tips, salaries, other
employee compensation, and selfemployment. Earned income does not
include any pension or annuity, transfer
payments, any cash or in-kind benefits,
or funds deposited in or accrued interest
on the FSS escrow account established
by a PHA or owner on behalf of a FSS
family.
Effective date of Contract of
Participation (CoP)—the day in which
the FSS family and the PHA or owner
execute the CoP.
Eligible families means current
residents of Public Housing (section 9)
and current Section 8(o) program
participants, as defined in this section,
including those participating in other
local self-sufficiency programs.
Enrollment means the date that the
FSS family entered into the CoP with
the PHA or owner.
Family Self-Sufficiency (FSS) Program
means the program established by a
PHA or owner within its jurisdiction to
promote self-sufficiency among
participating families, including the
coordination of supportive services to
these families, as authorized by section
23 of the 1937 Act.
FSS account means the FSS escrow
account authorized by section 23 of the
1937 Act, and as provided by § 984.305.
FSS credit means the amount credited
by the PHA or owner to the FSS family’s
FSS account.
FSS family means a family that
resides in Public Housing (section 9) or
receives Section 8(o) assistance, as
defined in this section, and that elects
to participate in the FSS program, and
whose designated adult member, as
determined in accordance with
§ 984.303(a), has signed the CoP.
FSS family in good standing means,
for purposes of this part, an FSS family
that is not in current eviction
proceedings and is otherwise in
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compliance with any repayment
agreement and the FSS CoP.
FSS related service program means
any program, publicly or privately
sponsored, that offers the kinds of
supportive services described in the
definition of ‘‘supportive services’’ set
forth in this § 984.103.
FSS slots refers to the total number of
families (as determined in the Action
Plan and, for mandatory programs, in
section 105 of this part) that the PHA
will serve in its FSS program.
FY means Federal Fiscal Year
(starting October 1 and ending
September 30, and year designated by
the calendar year in which it ends).
Head of FSS family means the adult
family member of the FSS family who
has signed the CoP. The head of the FSS
family may, but is not required to, be
the head of the household for purposes
of determining income eligibility and
rent.
Individual Training and Services Plan
(ITSP) means:
(i) A written plan that is prepared by
the PHA or owner in consultation with
the family member, and which sets
forth:
(A) The final and interim goals for the
participating FSS family member;
(B) The supportive services to be
provided to the participating FSS family
member;
(C) The activities to be completed by
that family member; and,
(D) The agreed upon completion dates
for the goals, services, and activities.
(ii) Each ITSP must be signed by the
PHA or owner and the participating FSS
family member, and is attached to, and
incorporated as part of the CoP. An ITSP
must be prepared for each adult member
who elects to participate in the FSS
program, including the adult family
member who has signed the CoP.
Multifamily assisted housing means
rental housing assisted by a Section 8
Housing Payments Program, pursuant to
24 CFR parts 880, 881, 883, 884, and
886.
Owner means the owner of
multifamily assisted housing.
Program Coordinating Committee
(PCC) is the committee described in
§ 984.202.
Section 8(o) means assistance
provided under section 8(o) of the 1937
Act (42 U.S.C. 1437f). Specifically,
housing assisted under the Housing
Choice Voucher (HCV) Program,
including Project-Based Vouchers
(PBV).
Self-sufficiency means that an FSS
family is no longer receiving Section 8,
Public Housing assistance, or any
Federal, State, or local rent,
homeownership subsidies, or welfare
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assistance. Achievement of selfsufficiency, although an FSS program
objective, is not a condition for receipt
of the FSS account funds.
Supportive services means those
appropriate services that a PHA or
owner will coordinate on behalf of an
FSS family under a CoP, which may
include, but are not limited to:
(i) Child care—child care (on an asneeded or ongoing basis) of a type that
provides sufficient hours of operation
and serves an appropriate range of ages;
(ii) Transportation—transportation
necessary to enable a participating FSS
family member to receive available
services, or to commute to their places
of employment;
(iii) Education—remedial education;
education for completion of high school
or attainment of a high school
equivalency certificate; education in
pursuit of a post-secondary degree or
certification;
(iv) Employment Supports—job
training, preparation, and counseling;
job development and placement; and
follow-up assistance after job placement
and completion of the CoP;
(v) Personal welfare—substance/
alcohol abuse treatment and counseling;
(vi) Household management—training
in household management;
(vii) Homeownership and housing
counseling—homeownership education
and assistance and housing counseling;
(viii) Financial Empowerment—
training in financial literacy, such as
financial coaching, training in financial
management, asset building, and money
management, including engaging in
mainstream banking, reviewing and
improving credit scores, etc.;
(ix) Other services—any other services
and resources, including case
management, reasonable
accommodations for individuals with
disabilities, that are determined to be
appropriate in assisting FSS families to
achieve economic independence and
self-sufficiency.
Unit size or size of unit refers to the
number of bedrooms in a dwelling unit.
Very low-income family. See
definitions in § 813.102.
Welfare assistance means (for
purposes of the FSS program only)
income assistance from Federal, (i.e.,
Temporary Assistance for Needy
Families (TANF) or subsequent
program) State, or local welfare
programs and includes only cash
maintenance payments designed to meet
a family’s ongoing basic needs. Welfare
assistance does not include:
(i) Nonrecurrent, short-term benefits
that:
(A) Are designed to deal with a
specific crisis or episode of need;
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59245
(B) Are not intended to meet recurrent
or ongoing needs; and,
(C) Will not extend beyond four
months.
(ii) Work subsidies (i.e., payments to
employers or third parties to help cover
the costs of employee wages, benefits,
supervision, and training);
(iii) Supportive services such as child
care and transportation provided to
families who are employed;
(iv) Refundable earned income tax
credits;
(v) Contributions to, and distributions
from, Individual Development Accounts
under Temporary Assistance for Needy
Families (TANF);
(vi) Services such as counseling, case
management, peer support, child care
information and referral, financial
empowerment, transitional services, job
retention, job advancement, and other
employment-related services that do not
provide basic income support;
(vii) Amounts solely directed to
meeting housing expenses;
(viii) Amounts for health care;
(ix) Supplemental Nutrition
Assistance Program and emergency
rental and utilities assistance;
(x) Supplemental Security Income,
Social Security Disability Income, or
Social Security; and
(xi) Child-only or non-needy TANF
grants made to or on behalf of a
dependent child solely on the basis of
the child’s need and not on the need of
the child’s current non-parental
caretaker.
§ 984.104 Basic requirements of the FSS
Program.
(a) An FSS Program established under
this part shall be operated in conformity
with the requirements of this part,
including the action plan at § 984.201;
and:
(1) As applicable to Section 8(o)
program participants:
(i) HCV regulations at 24 CFR part
982, for HCV program participants; and
(ii) PBV regulations at 24 CFR part
983, for PBV program participants.
(2) As applicable to Public Housing
program participants, the applicable
Public Housing regulations, including
the regulations in 24 CFR parts 5,
subpart F, 960, and 966; and,
(3) The nondiscrimination and equal
opportunity requirements set forth in 24
CFR part 5.
(b) [Reserved]
§ 984.105
Minimum program size.
(a) FSS program size—(1) Minimum
program size requirement. A PHA must
operate an FSS program of the
minimum program size determined in
accordance with paragraph (b) of this
section.
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(2) Exception to program operation or
to operate a smaller mandatory
program. Paragraph (c) of this section
states when HUD may grant an
exception to the program operation
requirement, and paragraph (d) states
when an exception may be granted to
operate a program that is smaller than
the minimum program size.
(3) Option to operate larger FSS
program. A PHA may choose to operate
an FSS program of a larger size than the
minimum.
(b) How to determine FSS minimum
program size—(1) In general. Each PHA
that was required to administer an FSS
program, shall continue to operate such
program for, at a minimum, the total
number of families the PHA was
required by statute to serve as of May
24, 2018, subject only to the availability
of sufficient amounts for housing
assistance under appropriations acts
and the provisions of paragraph (b)(2) of
this section.
(2) Reduction of minimum program
size. The minimum program size for a
PHA’s FSS program is reduced by one
slot for each family from any rental
assistance program (Public Housing or
Section 8, including multifamily
assisted housing) for which the PHA
administers FSS under this section and
that graduates from the FSS program by
fulfilling its FSS CoP on or after October
21, 1998. If an FSS slot is vacated by a
family that has not completed its FSS
CoP obligations, the slot must be filled
by a replacement family which has been
selected in accordance with the FSS
family selection procedures set forth in
§ 984.203.
(c) Exception to program operation.
(1) Upon approval by HUD, a PHA will
not be required to carry out an FSS
program if the PHA provides to HUD a
certification, as defined in § 984.103,
that the operation of such an FSS
program is not feasible because of local
circumstances, which may include, but
are not limited to, the following:
(i) Lack of supportive services
accessible to eligible families, including
insufficient availability of resources for
programs under title I of the Workforce
Innovation and Opportunity Act (29
U.S.C. 3111 et seq.);
(ii) Lack of funding for reasonable
administrative costs;
(iii) Lack of cooperation by other units
of State or local government; or,
(iv) Lack of interest in participating in
the FSS program on the part of eligible
families.
(2) An exception will not be granted
if HUD determines that local
circumstances do not preclude the PHA
from effectively operating an FSS
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program that is smaller than the
minimum program size.
(d) Exception to operate a smaller
mandatory program. Upon approval by
HUD, a PHA may be permitted to
operate an FSS program that is smaller
than the minimum program size if the
PHA provides to HUD a certification, as
defined in § 984.103, that the operation
of an FSS program of the minimum
program size is not feasible because of
local circumstances, which may
include, but are not limited to:
(1) Decrease in or lack of supportive
services accessible to eligible families,
including insufficient availability of
resources for programs under title I of
the Workforce Innovation and
Opportunity Act (29 U.S.C. 3111 et
seq.);
(2) Decrease in or lack of funding for
reasonable administrative costs;
(3) Decrease in or lack of cooperation
by other units of State or local
government;
(4) Decrease in or lack of interest in
participating in the FSS program on the
part of eligible families.
(e) Expiration of exception. A full or
partial exception to the FSS minimum
program size requirement (approved by
HUD in accordance with paragraph (c)
or (d) of this section) expires five (5)
years from the date of HUD approval of
the exception. If circumstances change
and a HUD-approved exception is no
longer needed, the PHA is not required
to effectuate the exception for the full
term of the exception. If a PHA seeks to
continue an exception after its
expiration, the PHA must submit a new
request and certification to HUD for
consideration.
(f) Review of Certification Records.
HUD reserves the right to examine,
during its management review of the
PHA, or at any time, the documentation
and data that a PHA relied on in
certifying to the unfeasibility of its
establishing and operating an FSS
program, or of operating one of less than
minimum program size.
§ 984.106
Cooperative agreements.
(a) A PHA may enter into a
Cooperative Agreement with one or
more owners to voluntarily make an
FSS program available to the owner’s
multifamily assisted housing tenants.
(b) A PHA and owner that enter into
a Cooperative Agreement to make an
FSS program available, are subject to
this part and the following
requirements:
(1) The PHA must open its FSS
waiting list to any eligible family
residing in the multifamily assisted
housing covered by the Cooperative
Agreement.
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(2) The owner must provide, at the
request of the PHA, information on
escrow amounts for participating
multifamily assisted housing tenants.
The Cooperative Agreement must
provide that the owner is responsible for
managing the escrow account, including
calculating and tracking of escrow in
accordance with § 984.305, and set forth
the procedures that will be in place for
the exchange of escrow information
between the PHA and the owner.
(3) The PHA may count multifamily
assisted housing families served by a
Cooperative Agreement under this
subpart as part of the calculation of the
FSS award under §§ 984.107 and
984.302.
(4) The PHA may use FSS funds to
serve multifamily assisted housing
tenants subject to a Cooperative
Agreement under this section.
(5) The Cooperative Agreement must
clearly specify the terms and conditions
of such agreement, including the
requirements of this subsection.
§ 984.107
FSS Award Funds Formula.
The Secretary may establish a formula
by which funds for administration of the
FSS program are awarded consistent
with 42 U.S.C. 1437u(i). Notice of, and
changes to, such formula will be
published in the Federal Register.
Subpart B—Program Development and
Approval Procedures
§ 984.201
Action Plan.
(a) Requirement for Action Plan. A
PHA or owner must have a HUDapproved Action Plan that complies
with the requirements of this section
before the PHA or owner operates an
FSS program, whether the FSS program
is a mandatory or voluntary program.
(b) Development of Action Plan. The
Action Plan shall be developed by the
PHA in consultation with the chief
executive officer of the applicable unit
of general local government and the
Program Coordinating Committee.
Consultation for the Action Plan by the
PHA or owner shall also include
representatives of current and
prospective FSS program participants,
any local agencies responsible for
programs under title I of the Workforce
Innovation and Opportunity Act (29
U.S.C. 3111 et seq.), other appropriate
organizations (such as other local
welfare and employment or training
institutions, child care providers,
financial empowerment providers,
nonprofit service providers, and private
businesses), and any other public and
private service providers affected by the
operation of the local program.
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(c) Plan submission—(1) Voluntary
program. The PHA or owner must
submit its Action Plan and obtain HUD
approval of the plan before the PHA or
owner carries out a voluntary FSS
program, including a program that
exceeds the minimum size for a
mandatory program, regardless of
whether the voluntary program receives
HUD funding.
(2) Revision. Following HUD’s initial
approval of the Action Plan, no further
approval of the Action Plan is required
unless the PHA or owner proposes to
make policy changes to the Action Plan
or increase the size of a voluntary
program; or HUD requires other
changes. In such cases, the PHA or
owner must submit such changes to the
Action Plan to HUD for approval.
(d) Contents of Action Plan. The
Action Plan shall describe the policies
and procedures for the operation of a
local FSS program, and shall contain, at
a minimum, the following information:
(1) Family demographics. A
description of the number, size,
characteristics, and other demographics
(including racial and ethnic data), and
the supportive service needs of the
families expected to participate in the
FSS program;
(2) Estimate of participating families.
A description of the number of eligible
FSS families who can reasonably be
expected to receive supportive services
under the FSS program, based on
available and anticipated Federal, tribal,
State, local, and private resources;
(3) Eligible families from other selfsufficiency programs. If applicable, the
number of families, by program type,
who are participating in other local selfsufficiency programs and are expected
to agree to execute an FSS CoP.
(4) FSS family selection procedures. A
statement indicating the procedures to
be utilized to select families for
participation in the FSS program,
subject to the requirements governing
the selection of FSS families, set forth
in § 984.203. This statement must
include a description of how the
selection procedures ensure that
families will be selected without regard
to race, color, religion, sex, disability,
familial status, or national origin.
(5) Incentives to encourage
participation. A description of the
incentives that will be offered to eligible
families to encourage their participation
in the FSS program (incentives plan).
The incentives plan shall provide for
the establishment of the FSS account in
accordance with the requirements set
forth in § 984.305, and other incentives,
if any. The incentives plan shall be part
of the Action Plan.
(6) Outreach efforts. A description of:
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(i) The efforts, including notification
and outreach efforts, to recruit FSS
participants from among eligible
families; and,
(ii) The actions to be taken to assure
that both minority and non-minority
groups are informed about the FSS
program, and how this information will
be made available.
(7) FSS activities and supportive
services. A description of the activities
and supportive services to be
coordinated on behalf of participating
FSS families and identification of the
public and private resources which are
expected to provide the supportive
services.
(8) Method for identification of family
support needs. A description of how the
FSS program will identify the needs and
coordinate the services and activities
according to the needs of the FSS
families;
(9) Program termination; withholding
of services; and available grievance
procedures. A description of all policies
concerning termination of participation
in the FSS program, or withholding of
coordination of supportive services, on
the basis of a family’s failure to comply
with the requirements of the CoP; and
the grievance and hearing procedures
available for FSS families.
(10) Assurances of non-interference
with rights of non-participating families.
An assurance that a family’s election not
to participate in the FSS program will
not affect the family’s admission to
public housing or to the Section 8
program or the family’s right to
occupancy in accordance with its lease.
(11) Timetable for program
implementation. A timetable for
implementation of the FSS program, as
provided in § 984.301(a)(1), including
the schedule for filling FSS slots with
eligible FSS families, as provided in
§ 984.301;
(12) Certification of coordination. A
certification that development of the
services and activities under the FSS
program has been coordinated with
programs under title I of the Workforce
Innovation and Opportunity Act (29
U.S.C. 3111 et seq.); and any other
relevant employment, child care,
transportation, training, and education
programs, and financial empowerment
in the applicable area, and that
implementation will continue to be
coordinated, in order to avoid
duplication of services and activities;
and,
(13) Optional additional information.
Such other information that would help
HUD determine the soundness of the
proposed FSS program.
(e) Eligibility of a combined program.
A PHA or owner that wishes to operate
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a joint FSS program with a PHA or
owner may combine its resources with
one or more PHAs or owners to deliver
supportive services under a joint Action
Plan that will provide for the
coordination of a combined FSS
program that meets the requirements of
this part.
(f) Single action plan. A PHA or
owner may submit one Action Plan that
covers all applicable rental assistance
programs (Section 8 vouchers, PBRA
and public housing) served by the FSS
program.
§ 984.202 Program Coordinating
Committee (PCC).
(a) General. Each participating PHA
must establish a PCC whose functions
will be to assist the PHA in securing
commitments of public and private
resources for the operation of the FSS
program within the PHA’s jurisdiction,
including assistance in developing the
Action Plan and in operating the
program.
(b) Membership—(1) Required
membership. The PCC must include
representatives of the PHA, including
one or more FSS coordinators, and one
or more participants from each HUDassisted program served by the PHA’s
FSS program. The PHA may seek
assistance from the following groups in
identifying potential PCC members:
(i) An area-wide or city-wide resident
council, if one exists;
(ii) If the PHA operates in a specific
public housing development, the
resident council or resident
management corporation, if one exists,
of the public housing development
where the public housing FSS program
is to be carried out;
(iii) Any other resident group, which
the PHA believes is interested in the
FSS program and would contribute to
the development and coordination of
the FSS program (such as the Resident
Advisory Board or tenant association, as
applicable.).
(2) Recommended membership.
Membership on the PCC may include
representatives of the unit of general
local government served by the PHA,
local agencies (if any) responsible for
carrying out programs under title I of
the Workforce Innovation and
Opportunity Act (29 U.S.C. 3111 et
seq.), and other organizations, such as
other State, local or tribal welfare and
employment agencies, public and
private primary, secondary, and postsecondary education or training
institutions, child care providers,
financial empowerment organizations,
nonprofit service providers, private
businesses, and any other public and
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private service providers with resources
to assist the FSS program.
(c) Alternative committee. The PHA
may, in consultation with the chief
executive officer of the unit of general
local government served by the PHA
and one or more residents of each HUDassisted program served by the FSS
program, utilize an existing entity as the
PCC if the membership of the existing
entity consists, or will consist of, the
individuals identified in paragraph
(b)(1) of this section, and also includes
individuals from the same or similar
organizations identified in paragraph
(b)(2) of this section.
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§ 984.203 FSS family selection
procedures.
(a) Preference in the FSS selection
process. A PHA has the option of giving
a selection preference for up to fifty (50)
percent of its FSS slots to eligible
families, as defined in § 984.103, who
have one or more family members
currently enrolled in an FSS related
service program or on the waiting list
for such a program. The PHA may limit
the selection preference given to
participants in, and applicants for, FSS
related service programs to one or more
eligible FSS related service programs. A
PHA that chooses to exercise the
selection preference option must
include the following information in its
Action Plan:
(1) The percentage of FSS slots, not to
exceed fifty (50) percent of the total
number of FSS slots, for which it will
give a selection preference;
(2) The FSS related service programs
to which it will give a selection
preference to the programs’ participants
and applicants; and
(3) The method of outreach to, and
selection of, families with one or more
members participating in the identified
programs.
(b) Selection among families with
preference. The PHA may use either of
the following to select among applicants
on the FSS waiting list with the same
preference status:
(1) Date and time of application to the
FSS program; or,
(2) A drawing or other random choice
technique.
(c) FSS selection without preference.
For those FSS slots for which a selection
preference is not applicable, the FSS
slots must be filled with eligible
families in accordance with an objective
selection system, such as a lottery, the
length of time living in subsidized
housing, or the date the family
expressed an interest in participating in
the FSS program. The objective system
to be used by the PHA must be
described in the PHA’s Action Plan.
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(d) Motivation as a selection factor—
(1) General. A PHA may screen families
for interest, and motivation to
participate in the FSS program,
provided that the factors utilized by the
PHA are those which solely measure the
family’s interest, and motivation to
participate in the FSS program.
(2) Permissible motivational screening
factors. Permitted motivational factors
include requiring attendance at FSS
orientation sessions or preselection
interviews and assigning certain tasks
which indicate the family’s willingness
to undertake the obligations which may
be imposed by the FSS CoP. Any tasks
assigned shall be those which may be
readily accomplishable by the family,
based on the family members’
educational level, and disabilities, if
any. Reasonable accommodations must
be made for individuals with
disabilities, including, e.g., mobility,
manual, sensory, speech, mental,
intellectual, or developmental
disabilities;
(3) Prohibited motivational screening
factors. Prohibited motivational
screening factors include the family’s
educational level, educational or
standardized motivational test results,
previous job history or job performance,
credit rating, marital status, number of
children, or other factors, such as
sensory or manual skills, and any
factors which may result in
discriminatory practices or treatment
toward individuals with disabilities or
minority or non-minority groups.
§ 984.204
On-site facilities.
Each PHA or owner may, subject to
the approval of HUD, make available
and utilize common areas or
unoccupied dwelling units in properties
owned by the entity to provide or
coordinate supportive services under
any FSS program.
Subpart C—Program Operations
§ 984.301
Program implementation.
(a) Voluntary program
implementation. Unless otherwise
required under a funding notice, there is
no deadline for implementation of a
voluntary program. A voluntary
program, however, may not be
implemented before the requirements of
§ 984.201 have been satisfied.
(b) Program administration. A PHA
may employ appropriate staff, including
a service coordinator or program
coordinator to administer its FSS
program, and may contract with an
appropriate organization to establish
and administer all or part of the FSS
program, including the FSS account, as
provided by § 984.305.
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§ 984.302
FSS funds.
(a) Public housing program. Subject to
appropriations by Congress, PHAs may
use funds provided under section 9 of
the 1937 Act to cover reasonable and
eligible administrative costs incurred by
PHAs in carrying out the FSS program.
(b) Section 8(o) program. Subject to
appropriations by Congress, PHAs may
use the administrative fees paid to PHAs
for costs associated with operation of an
FSS program.
(c) FSS funds. FSS funds associated
with operation of an FSS program are
established by the Congress and subject
to appropriations. FSS funds may be
used by PHAs or owners for costs
associated with families who are
enrolled in an FSS program under this
part, including through a Cooperative
Agreement in accordance with
§ 984.106.
§ 984.303
Contract of Participation (CoP).
(a) General. Each eligible family that
is selected to participate in an FSS
program must enter into a CoP with the
PHA or owner that operates the FSS
program in which the family will
participate. The CoP shall be signed by
a representative of the PHA or the
owner and the head of the FSS family,
as designated by the family in
consultation with the PHA or the owner.
This head of FSS family does not have
to be the same as the official Head of
Household for rental assistance
purposes.
(b) Form and content of contract—(1)
General. The CoP, which incorporates
the ITSP(s), shall set forth the principal
terms and conditions governing
participation in the FSS program. These
include the rights and responsibilities of
the FSS family and of the PHA or
owner, the services to be provided to,
and the activities to be completed by,
each adult member of the FSS family
who elects to participate in the program.
(2) FSS Family goals. The ITSP
incorporated in the CoP, shall establish
specific interim and final goals by
which the PHA or owner, and the
family, may measure the FSS family’s
progress towards fulfilling its
obligations under the CoP, and
becoming self-sufficient. For any FSS
family that is a recipient of welfare
assistance, the PHA or owner must
establish as an interim goal for each FSS
participant that every member of the
family become independent from
welfare assistance before the expiration
of the term of the CoP, including any
extension thereof. Also, see the
employment obligation described in
§ 984.303(b)(4) below. Aside from the
goals specifically required in this
section, PHAs or owners must work
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with each participant to establish
realistic and individualized goals and
may not include additional mandatory
goals that are applicable to every FSS
program participant.
(3) Compliance with lease terms. The
CoP shall provide that one of the
obligations of the FSS family is to
comply with the terms and conditions
of the respective public housing or
Section 8 lease. All considerations
allowed for other assisted residents for
repayment agreements, etc., shall not be
limited for FSS participants due to their
participation in FSS.
(4) Employment obligation. (i)
Although all members of the FSS family
may seek and maintain suitable
employment during the term of the
contract, only one adult family member
with an ITSP shall be required under
the CoP to seek and maintain suitable
employment during the term of the
contract and any extension thereof.
(ii) Seek employment. The obligation
to seek employment means searching for
jobs, applying for employment,
attending job interviews, and otherwise
following through on employment
opportunities.
(iii) Determination of suitable
employment. A determination of
suitable employment shall be made by
the PHA or owner based on the skills,
education, and job training of the
household member, and based on the
available job opportunities within the
jurisdiction served by the PHA or
owner.
(5) Consequences of noncompliance
with the contract. The CoP shall specify
that if the FSS family fails to comply,
without good cause, with the terms and
conditions of the CoP, including
compliance with the public housing
lease or the Section 8 lease, the PHA or
owner may:
(i) Withhold the coordination of
supportive services; or,
(ii) Terminate the family’s
participation in the FSS program.
(c) Contract term. The CoP shall
provide that each FSS family will be
required to fulfill those obligations to
which the FSS family has committed
itself under the CoP no later than 5
years after the first recertification of
income after the execution date of the
CoP.
(d) Contract extension. The PHA or
owner shall, in writing, extend the term
of the CoP for a period not to exceed
two (2) years for any FSS family that
requests, in writing, an extension of the
contract, provided that the PHA or
owner finds that good cause exists for
granting the extension. The family’s
written request for an extension must
include a description of the need for the
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extension. As used in this paragraph (d)
of this section, ‘‘good cause’’ means
circumstances beyond the control of the
FSS family, as determined by the PHA
or owner, such as a serious illness or
involuntary loss of employment, or
active pursuit of a current or additional
goal that will result in furtherance of
self-sufficiency during the period of the
extension (e.g., completion of a college
degree during which the participant is
unemployed or under-employed, credit
repair towards being homeownership
ready, etc.). Extension of the CoP will
entitle the FSS family to continue to
have amounts credited to the family’s
FSS account in accordance with
§ 984.304.
(e) Unavailability of supportive
services—(1) Good-faith effort to replace
unavailable services. If a social service
agency fails to deliver the supportive
services pledged under an FSS family
member’s ITSP, the PHA or owner shall
make a good faith effort to obtain these
services from another agency.
(2) Assessment of necessity of
services. If the PHA or owner is unable
to obtain the services from another
agency, the PHA or owner shall reassess
the family member’s needs and
determine whether other available
services would achieve the same
purpose. If other available services
would not achieve the same purpose,
the PHA or owner shall determine
whether the unavailable services are
integral to the FSS family’s
advancement or progress toward selfsufficiency. If the unavailable services
are:
(i) Determined not to be integral to the
FSS family’s advancement toward selfsufficiency, the PHA or owner shall
revise the ITSP to delete these services,
and modify the CoP to remove any
obligation on the part of the FSS family
to accept the unavailable services, in
accordance with paragraph (f) of this
section; or,
(ii) Determined to be integral to the
FSS family’s advancement toward selfsufficiency, the PHA or owner shall
declare the CoP null and void and
follow the requirements in paragraph (k)
of this section.
(f) Modification. The PHA or owner
and the FSS family may mutually agree
to modify the CoP with respect to the
ITSP and/or the contract term in
accordance with paragraph (d) of this
section, and/or designation of the head
of the FSS family. Modifications must
be in writing.
(g) Completion of the contract. The
CoP is considered to be completed, and
a family’s participation in the FSS
program is considered to be concluded
when the FSS family has fulfilled all of
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its obligations under the CoP, on or
before the expiration of the contract
term, including any extension thereof.
(h) Termination of the contract. The
CoP is automatically terminated if the
family’s housing assistance is
terminated in accordance with HUD
requirements. The CoP may be
terminated before the expiration of the
contract term, and any extension
thereof, by:
(1) Mutual consent of the parties;
(2) The failure of the FSS family to
meet its obligations under the CoP
without good cause, including, for
Section 8(o) participants, failure to
comply with the contract requirements
because the family has moved outside
the jurisdiction of the PHA or out of
multifamily assisted housing;
(3) The family’s withdrawal from the
FSS program;
(4) Such other act as is deemed
inconsistent with the purpose of the
FSS program; or
(5) Operation of law.
(i) Option to terminate FSS
participation and supportive service
assistance. The PHA or owner may
terminate or withhold the coordination
of supportive services, and the FSS
family’s participation in the FSS
program, if the PHA or owner
determines, in accordance with the FSS
Action Plan hearing procedures, that the
FSS family has failed to comply without
good cause with the requirements of the
CoP as provided in paragraph (b)(5) of
this section.
(j) Transitional supportive service
assistance. A PHA or owner may
continue to offer to a former FSS family
that has completed its CoP, appropriate
coordination of those FSS supportive
services needed to become selfsufficient (if the family still resides in
public housing or Section 8 housing), or
in remaining self-sufficient (if the family
no longer resides in public, Section 8,
or other assisted housing).
(k) Nullification. (1) The CoP is
considered null and void when:
(i) Services that the PHA or owner has
determined are integral to the FSS
family’s advancement towards selfsufficiency are unavailable, as described
in paragraph (e) of this section.
(ii) The head of the FSS family
becomes permanently disabled and
unable to work or dies during the period
of the contract, unless the PHA or owner
and the FSS family determine that it is
possible to modify the contract to
designate a new head of the FSS family.
(2) Upon nullification of a CoP,
escrow funds must be handled
consistent with § 984.305(b)(3) and
(c)(3).
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§ 984.304 Amount of rent paid by FSS
family and increases in family income.
(a) The amount of rent paid by an FSS
family is determined in accordance with
the requirements of the applicable
housing assistance program as specified
in paragraphs (a)(1) and (2) of this
section.
(1) Public housing program:
Calculation of total tenant payment.
Total tenant payment for an FSS family
participating in the FSS program is
determined in accordance with the
regulations set forth in 24 CFR part 5,
subpart F.
(2) Section 8(o) programs: Calculation
of total tenant payment. (i) For the HCV
program, rent is determined in
accordance with 24 CFR part 982,
subpart K; and
(ii) For the PBV program, rent is
determined in accordance with 24 CFR
part 983, subpart G.
(b) Increases in FSS family income.
Any increase in the earned income of an
FSS family during its participation in an
FSS program may not be considered as
income or a resource for purposes of
eligibility of the FSS family for other
benefits, or amount of benefits payable
to the FSS family, under any other
program administered by HUD.
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§ 984.305
FSS account.
(a) Establishment of FSS account—(1)
General. The PHA or owner shall
deposit the FSS account funds of all
families participating in an FSS program
into a single interest-bearing depository
account. The PHA or owner must
deposit the FSS account funds in one or
more of the HUD-approved investments.
This account may be part of the PHA’s
or owner’s overall accounts, as long as
it is in compliance with paragraph (a)(2)
of this section. During the term of the
CoP, the escrow credit amount shall be
determined in accordance with
paragraph (b) of this section at each
reexamination of income, which occurs
after the effective date of the CoP. Such
escrow credit amount must be deposited
each month by the PHA or owner to
each family’s FSS account.
(2) Accounting for FSS account
funds—(i) Accounting records. The total
of the combined FSS account funds will
be supported in the accounting records
by a subsidiary ledger showing the
balance applicable to each FSS family.
(ii) Proration of investment income.
The investment income for funds in the
FSS account will be prorated and
credited to each family’s FSS account
based on the balance in each family’s
FSS account at the end of the period for
which the investment income is
credited.
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16:55 Sep 18, 2020
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(iii) Reduction of amounts due by FSS
family. If the FSS family has not paid
the family contribution towards rent, or
other amounts, if any, due under the
public housing or Section 8-assisted
lease, the balance in the family’s FSS
account shall be reduced by that amount
(as determined by the owner or reported
by the owner to the PHA in the Section
8(o) programs) at the time of final
disbursement of FSS escrow funds in
accordance with paragraph (c) of this
section. If the FSS family has been
found to have fraudulently underreported income after the escrow
calculation baseline was set, the amount
credited to the FSS account will be
based on the income amounts originally
reported by the FSS family. If the FSS
family is found to have fraudulently
under-reported income in the
certification used to set the baseline, the
escrow for the entire period of the CoP
will be re-calculated using the correct
income to set the baseline and then
subsequent escrow amounts.
(3) Reporting on FSS account. Each
PHA or owner will be required to make
a report, at least once annually, to each
FSS family on the status of the family’s
FSS account. At a minimum, the report
will include:
(i) The balance at the beginning of the
reporting period;
(ii) The amount of the family’s rent
payment that was credited to the FSS
account, during the reporting period;
(iii) Any deductions made from the
account at the time of final
disbursement of FSS escrow funds (see
paragraphs (a)(2)(iii) and (c) of this
section) for amounts due the PHA or
owner;
(iv) The amount of interest earned on
the account during the year; and
(v) The total in the account at the end
of the reporting period.
(b) FSS credit—(1) Determining the
family’s baseline information. When
determining the family’s baseline
annual earned income and the baseline
monthly rent amounts for purposes of
computing the FSS credit, the PHA or
owner must set a policy to either
conduct a new re-examination of
income before the effective date of the
FSS contract, or to use the amounts on
the family’s last income reexamination.
(2) Computation of amount. The FSS
credit amount shall be the lower of:
(i) Thirty (30) percent of one-twelfth
(1/12) (i.e., two and a half (2.5) percent)
of the amount by which the family’s
current annual earned income exceeds
the family’s baseline annual earned
income; or
(ii) The increase in the family’s
monthly rent. The increase in the
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family’s monthly rent shall be the lower
of:
(A) The amount by which the family’s
current monthly rent exceeds the
family’s baseline monthly rent;
(B) For HCV families, the difference
between the baseline monthly rent and
the current gross rent (i.e., rent to owner
plus any utility allowance) or the
payment standard, whichever is lower;
or
(C) For PBV families, the difference
between the baseline monthly rent and
the current gross rent (i.e., rent to owner
plus any utility allowance).
(3) Ineligibility for FSS credit. FSS
families who are not low-income
families (i.e., whose adjusted annual
income exceeds eighty (80) percent of
the area median income) shall not be
entitled to any FSS credit.
(4) Cessation of FSS credit. The PHA
or owner shall not make additional
credits to the FSS family’s FSS account:
(i) When the FSS family has
completed the CoP, as defined in
§ 984.303(g);
(ii) When the CoP is terminated or
otherwise nullified; or
(iii) During the time a HCV family is
in the process of moving to a new unit,
in accordance with HCV program
requirements, and is not under a lease.
(c) Disbursement of FSS account
funds—(1) General. The amount in an
FSS account, in excess of any amount
owed to the PHA or owner by the FSS
family, as provided in paragraph
(a)(2)(iii) of this section, shall be paid to
the head of the FSS family when the
CoP has been completed as provided in
§ 984.303(g), and if, at the time of
contract completion, the head of the
FSS family submits to the PHA or owner
a certification, as defined in § 984.103,
that to the best of his or her knowledge
and belief, no member of the FSS family
is a recipient of welfare assistance.
(2) Disbursement before expiration of
contract term. (i) If the PHA or owner
determines that the FSS family has
fulfilled its obligations under the CoP
before the expiration of the contract
term, and the head of the FSS family
submits a certification that, to the best
of his or her knowledge, no member of
the FSS family is a recipient of welfare
assistance, the amount in the family’s
FSS account, in excess of any amount
owed to the PHA or owner by the FSS
family, as provided in paragraph
(a)(2)(iii) of this section, shall be paid to
the head of the FSS family.
(ii) If the PHA or owner determines
that the FSS family has fulfilled certain
interim goals established in the CoP and
needs a portion of the FSS account
funds for purposes consistent with the
CoP, such as completion of higher
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education (i.e., college, graduate
school), job training, or to meet start-up
expenses involved in creation of a small
business, the PHA or owner may, at the
PHA’s or owner’s sole discretion,
disburse a portion of the funds from the
family’s FSS account to assist the family
in paying those expenses. Unless the
interim disbursement was made based
on fraudulent information from the
family, the family is not required to
repay such interim amounts if the
family does not complete the CoP.
(3) Disbursement under nullified
contracts. If the CoP is nullified in
accordance with § 984.303(k), the PHA
or owner must disburse to the family, in
excess of any amount owed to the PHA
or owner by the FSS family, as provided
in paragraph (a)(2)(iii) of this section,
the amount of escrow funds
accumulated by the family before the
effective date of the nullification of the
contract.
(4) Verification of family certification.
Before disbursement of the FSS account
funds to the family, the PHA or owner
may verify that the FSS family is no
longer a recipient of welfare assistance
by requesting copies of any documents
which may indicate whether the family
is receiving any welfare assistance and
contacting welfare agencies.
(d) Succession of FSS account. If the
head of the FSS family ceases to reside
with other family members in the public
housing or the Section 8-assisted unit,
the remaining members of the FSS
family, after consultation with the PHA
or owner, shall have the right to
designate another family member to
receive the funds in accordance with
paragraph (c) of this section.
(e) Use of FSS account funds for
homeownership. An FSS family may use
its FSS account funds for the purchase
of a home, including the purchase of a
home under one of HUD’s
homeownership programs, or other
Federal, State, or local homeownership
programs, unless such use is prohibited
by the statute or regulations governing
the particular homeownership program.
(f) Forfeiture of FSS account funds—
(1) Conditions for forfeiture. Amounts in
the FSS account shall be forfeited upon
the occurrence of the following:
(i) The CoP is terminated, as provided
in § 984.303(h); or,
(ii) The CoP is completed by the
family, as provided in § 984.303(g), but
the FSS family is receiving welfare
assistance at the time the CoP expires,
including any extension thereof.
(2) Treatment of forfeited FSS account
funds. FSS account funds forfeited by
the FSS family must be used by the PHA
or owner for the benefit of the FSS
program and its participants.
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16:55 Sep 18, 2020
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(i) Specifically, such funds may be
used on the following eligible activities:
(A) Support for FSS participants in
good standing, including, but not
limited to, transportation, child care,
training, testing fees, and employment
preparation costs.
(B) Training for Program
Coordinator(s),
(C) Other eligible activities as
determined by the Secretary.
(ii) Such funds may not be used for
salary and fringe benefits of FSS
program coordinators; for HAP expenses
or public housing operating funds; or
any other activity determined ineligible
by the Secretary.
§ 984.306
HCV portability requirements.
(a) Initial occupancy—(1) First 12
months. An HCV family participating in
the FSS program must lease an HCVassisted unit, for a minimum period of
12 months after the effective date of the
CoP, in the jurisdiction of the PHA that
selected the family for the FSS program.
However, the initial PHA may approve
a family’s request to move outside of its
jurisdiction under portability (in
accordance with § 982.353 of this
chapter) during this period.
(2) After the first 12 months. After the
first 12 months of the FSS CoP, the FSS
family may move outside the initial
PHA jurisdiction under portability
procedures (in accordance with
§ 982.353 of this chapter).
(b) An FSS family moves to the
jurisdiction of a receiving PHA that
administers an FSS program. Whether
the receiving PHA bills the initial PHA
or absorbs the FSS family into its HCV
program, the receiving PHA must enroll
an FSS family in good standing in its
FSS program, unless the receiving PHA
and the initial PHA agree to the FSS
family’s continued participation in the
initial PHA’s FSS program if the initial
PHA determines that the relocating FSS
family has demonstrated that,
notwithstanding the move, it will be
able to fulfill its responsibilities under
the initial or modified CoP at its new
place of residence. For example, the FSS
family may be able to commute to the
supportive services specified in the CoP,
or the family may move to obtain
employment as specified in the contract.
(c) An FSS family moves to the
jurisdiction of a receiving PHA that does
not administer an FSS program. If the
receiving PHA does not administer an
FSS program, the FSS family may not
continue participation in the FSS
program. The initial PHA must clearly
discuss the options that may be
available to the family, depending on
the family’s specific circumstances,
which may include, but are not limited
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59251
to, modification of the FSS contract,
termination of the FSS contract and
forfeiture of escrow, or locating a
receiving PHA that administers an FSS
program.
(d) Single FSS account. Regardless of
whether the FSS family remains in the
FSS program of the initial PHA or is
enrolled in the FSS program of the
receiving PHA, there will be a single
FSS account which will be maintained
by the initial PHA if the receiving PHA
is billing the initial PHA. If an FSS
family will be absorbed by the receiving
PHA, the initial PHA will transfer the
family’s FSS account to the receiving
PHA and the receiving PHA will
maintain the FSS account.
(e) FSS program termination; loss of
FSS account. (1) If an FSS family
relocates to another jurisdiction, as
provided under this section, and is
unable to fulfill its obligations under the
CoP (or any modifications thereto), the
PHA, which is a party to the CoP, must
terminate the FSS family from the FSS
program, and the family’s FSS account
will be forfeited. Termination of FSS
program participation must be used
only as a last resort, after the PHA
determines, in consultation with the
family, that the family would be unable
to fulfill its obligations under the CoP
after the move and that the current CoP
cannot be modified to allow for
graduation prior to porting. When
termination is the only option, the PHA
must clearly notify the family that the
move will result in the loss of escrow
funds.
(2) In the event of forfeiture of the
family’s FSS account, the funds in the
family’s FSS account will revert to the
PHA maintaining the FSS account for
the family.
(f) Contract of Participation (CoP). (1)
If the FSS family enrolls in the receiving
PHA’s FSS program pursuant to this
section, the receiving PHA will enter
into a new CoP with the FSS family for
the term remaining on the contract with
the initial PHA. The initial PHA will
terminate its CoP with the family;
(2) If the FSS family remains in the
FSS program of the initial PHA,
pursuant to this section, the original
CoP, executed by the initial PHA, will
remain as the contract in place.
(g) Enrollment of a non-participant in
the receiving PHA’s FSS program—(1)
Billing. If the receiving PHA bills the
initial PHA, a family that was not an
FSS participant at the initial PHA may
not enroll in the receiving PHA’s FSS
program.
(2) Absorption. If the receiving PHA
absorbs the family into its HCV
program, the receiving PHA may,
consistent with the receiving PHA’s FSS
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enrollment policies, enroll a family that
was not an FSS participant at the initial
PHA into its FSS program.
Subpart D—Reporting
§ 984.401
Reporting.
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Each PHA or owner that carries out an
FSS program shall submit to HUD, in
the form prescribed by HUD, a report
regarding its FSS program. The report
shall include the following information:
(a) A description of the activities
carried out under the program;
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18:03 Sep 18, 2020
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(b) A description of the effectiveness
of the program in assisting families to
achieve economic independence and
self-sufficiency, including the number
of families enrolled and graduated and
the number of established escrow
accounts and positive escrow balances;
(c) A description of the effectiveness
of the program in coordinating resources
of communities to assist families to
achieve economic independence and
self-sufficiency; and
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(d) Any recommendations by the PHA
or owner or the appropriate local
Program Coordinating Committee for
legislative or administrative action that
would improve the FSS program and
ensure the effectiveness of the program.
R. Hunter Kurtz,
Assistant Secretary for Public and Indian
Housing.
Dana T. Wade,
Assistant Secretary for Housing—Federal
Housing Commissioner.
BILLING CODE 4210–01–P
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EP21SE20.007</GPH>
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59254
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[FR Doc. 2020–18896 Filed 9–18–20; 8:45 am]
BILLING CODE 4210–67–C
DEPARTMENT OF HOMELAND
SECURITY
Coast Guard
33 CFR Part 165
[Docket Number USCG–2020–0328]
RIN 1625–AA00
Safety Zones; Marine Events Held in
the Sector Boston Captain of the Port
Zone
Coast Guard, DHS.
Notice of proposed rulemaking.
AGENCY:
ACTION:
The Coast Guard is proposing
to establish a temporary safety zone for
certain waters of the Atlantic Ocean.
This action is necessary to provide for
the safety of life on these navigable
waters near Sandy Beach, Cohasset, MA,
during a fireworks display on November
28, 2020. This proposed rulemaking
would prohibit persons and vessels
from being in the safety zone unless
authorized by the Captain of the Port
Boston or a designated representative.
We invite your comments on this
proposed rulemaking.
DATES: Comments and related material
must be received by the Coast Guard on
or before October 21, 2020.
ADDRESSES: You may submit comments
identified by docket number USCG–
2020–0328 using the Federal
eRulemaking Portal at https://
www.regulations.gov. See the ‘‘Public
Participation and Request for
Comments’’ portion of the
SUPPLEMENTARY INFORMATION section for
further instructions on submitting
comments.
SUMMARY:
If
you have questions about this proposed
rulemaking, call or email MSTC Jae L.
Ramirez, Waterways Management
Representative; telephone 617–447–
6120 or Jae.L.Ramirez@uscg.mil.
SUPPLEMENTARY INFORMATION:
FOR FURTHER INFORMATION CONTACT:
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I. Table of Abbreviations
CFR Code of Federal Regulations
DHS Department of Homeland Security
FR Federal Register
NPRM Notice of proposed rulemaking
§ Section
U.S.C. United States Code
II. Background, Purpose, and Legal
Basis
On May 26, 2020, the Cohasset 250th
Anniversary 2020 Committee notified
the Coast Guard that it will be
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16:55 Sep 18, 2020
Jkt 250001
conducting a fireworks display from 9
p.m. to 10 p.m. on November 28, 2020,
to commemorate the 250th anniversary
of Cohasset. The fireworks are to be
launched from a barge in the Atlantic
Ocean approximately 1000 feet north of
the Sandy Beach in Cohasset, MA.
Hazards from firework displays include
accidental discharge of fireworks,
dangerous projectiles, and falling hot
embers or other debris. The Captain of
the Port Boston (COTP) has determined
that potential hazards associated with
the fireworks to be used in this display
would be a safety concern for anyone
within a 420-foot radius of the barge.
The purpose of this rulemaking is to
ensure the safety of vessels and the
navigable waters within a 420-foot
radius of the fireworks barge before,
during, and after the scheduled event.
The Coast Guard is proposing this
rulemaking under authority in 46 U.S.C.
70034 (previously 33 U.S.C. 1231).
III. Discussion of Proposed Rule
The COTP is proposing to establish a
safety zone from 9 p.m. to 10 p.m. on
November 28, 2020. The safety zone
would cover all navigable waters within
420 feet of a barge in the Atlantic Ocean
located approximately 1000 feet north of
Sandy Beach, Cohasset, MA. The
duration of the zone is intended to
ensure the safety of vessels and these
navigable waters before, during, and
after the scheduled 9 p.m. to 10 p.m.
fireworks display. No vessel or person
would be permitted to enter the safety
zone without obtaining permission from
the COTP or a designated
representative. The regulatory text we
are proposing appears at the end of this
document.
IV. Regulatory Analyses
We developed this proposed rule after
considering numerous statutes and
Executive orders related to rulemaking.
Below we summarize our analyses
based on a number of these statutes and
Executive orders, and we discuss First
Amendment rights of protestors.
A. Regulatory Planning and Review
Executive Orders 12866 and 13563
direct agencies to assess the costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits.
Executive Order 13771 directs agencies
to control regulatory costs through a
budgeting process. This NPRM has not
been designated a ‘‘significant
regulatory action,’’ under Executive
Order 12866. Accordingly, the NPRM
has not been reviewed by the Office of
Management and Budget (OMB), and
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pursuant to OMB guidance it is exempt
from the requirements of Executive
Order 13771.
This regulatory action determination
is based on this regulatory action
determination is based on the size,
location, duration, and time-of-day of
the safety zone. Vessel traffic would be
able to safely transit around this safety
zone which would impact a small
designated area of the Atlantic Ocean
for one hour during the evening when
vessel traffic is normally low. Moreover,
the Coast Guard would issue a
Broadcast Notice to Mariners via VHF–
FM marine channel 16 about the zone,
and the rule would allow vessels to seek
permission to enter the zone.
B. Impact on Small Entities
The Regulatory Flexibility Act of
1980, 5 U.S.C. 601–612, as amended,
requires Federal agencies to consider
the potential impact of regulations on
small entities during rulemaking. The
term ‘‘small entities’’ comprises small
businesses, not-for-profit organizations
that are independently owned and
operated and are not dominant in their
fields, and governmental jurisdictions
with populations of less than 50,000.
The Coast Guard certifies under 5 U.S.C.
605(b) that this proposed rule would not
have a significant economic impact on
a substantial number of small entities.
While some owners or operators of
vessels intending to transit the safety
zone may be small entities, for the
reasons stated in section IV.A above,
this proposed rule would not have a
significant economic impact on any
vessel owner or operator.
If you think that your business,
organization, or governmental
jurisdiction qualifies as a small entity
and that this rule would have a
significant economic impact on it,
please submit a comment (see
ADDRESSES) explaining why you think it
qualifies and how and to what degree
this rule would economically affect it.
Under section 213(a) of the Small
Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104–121),
we want to assist small entities in
understanding this proposed rule. If the
rule would affect your small business,
organization, or governmental
jurisdiction and you have questions
concerning its provisions or options for
compliance, please call or email the
person listed in the FOR FURTHER
INFORMATION CONTACT section. The Coast
Guard will not retaliate against small
entities that question or complain about
this proposed rule or any policy or
action of the Coast Guard.
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]]>Agencies
[Federal Register Volume 85, Number 183 (Monday, September 21, 2020)]
[Proposed Rules]
[Pages 59234-59254]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-18896]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Parts 887 and 984
[Docket No. FR-6114-P-01]
RIN 2577-AD09
Streamlining and Implementation of Economic Growth, Regulatory
Relief, and Consumer Protection Act Changes to Family Self-Sufficiency
(FSS) Program
AGENCY: Office of the Assistant Secretary for Public and Indian
Housing, HUD, and Office of the Assistant Secretary for Housing--
Federal Housing Commissioner, HUD.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: The Economic Growth, Regulatory Relief, and Consumer
Protection Act (``the Economic Growth Act'') was signed into law on May
24, 2018, amending HUD's Family Self-Sufficiency (FSS) program. Section
306 of the Act made multiple amendments to the FSS program, including
changes to the size calculation for the FSS program, expanding the
definition of eligible family to include tenants of certain privately
owned multifamily projects subsidized with Project-Based Rental
Assistance (PBRA), updating the FSS Contract of Participation (CoP),
reducing burdens on Public Housing Agencies (PHAs) and multifamily
assisted housing owners, clarifying escrow account requirements, and
updating the program coordinator and action plan requirements. This
proposed rule also includes additional changes to reduce burden and
streamline the program for PHAs, owners, and eligible families.
DATES: Comment due date: November 20, 2020.
ADDRESSES: Interested persons are invited to submit comments regarding
this proposed rule. All communications must refer to the above docket
number and title. There are two methods for submitting public comments.
1. Submission of Comments by Mail. Comments may be submitted by
mail to the Regulations Division, Office of General Counsel, U.S.
Department of Housing and Urban Development, 451 7th Street SW, Room
10276, Washington, DC 20410-0500.
2. 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. All
submissions must refer to the docket number and title of the rule.
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 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 via TTY by calling the toll-free Federal Relay
Service at 800-877-8339. Copies of all comments submitted are available
for inspection and downloading at www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: For Public Housing FSS contact Anice
S. Chenault, Office of Public and Indian Housing, U.S. Department of
Housing and Urban Development, 451 7th Street SW, Room 4120,
Washington, DC 20410; telephone number 502-618-6163 (this is not a
toll-free number); and for Multifamily FSS contact Carissa L. Janis,
Office of Multifamily Housing Programs, U.S. Department of Housing and
Urban Development, 451 7th Street SW, Room 6152, Washington, DC 20410;
telephone number 202-402-2487 (this is not a toll-free number). The
public is encouraged to email questions to [email protected]. Persons with
hearing or speech impairments may access this number through TTY by
calling the toll-free Federal Relay Service at 800-877-8339.
SUPPLEMENTARY INFORMATION:
I. Background
In 1990, section 554 of the Cranston Gonzalez National Affordable
Housing Act (Pub. L. 101-625, approved November 28, 1990) amended the
United States Housing Act of 1937 by adding a new Section 23 (42 U.S.C.
1437u) to create the FSS program. The FSS program requires that PHAs)
and Indian Housing Authorities (IHAs) \1\ use Public and Indian Housing
assistance and Section 8 Housing assistance rental voucher programs,
together with public and private resources, to provide supportive
services, case management, and an escrow account to participating
families, with the intent to help families achieve economic
independence and self-sufficiency. The goal of the program is to enable
participating low-income families to increase their earned income and
reduce their dependency on welfare assistance and rental subsidies. FSS
program coordinators create plans with participating families to
achieve goals and connect them with services that will assist the
family in making progress toward economic security. As the family's
earnings increase, the difference between the original rent and the
rent that increases due to increased earned income is credited to an
interest-bearing escrow account on behalf of the family. Families that
meet program requirements and successfully complete the FSS program
receive their accrued FSS escrow funds, plus interest. No formal
restrictions exist on the use of the escrowed funds, but many families
use the funds to help with the purchase of a home, debt reduction,
post-secondary education, or to start a new business.
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\1\ The Native American Housing Assistance and Self
Determination Act of 1996 (25 U.S.C. 4101 et seq.) (NAHASDA) removed
the application of the FSS program to IHAs.
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In September 1991, HUD initially implemented the FSS program by
notice \2\ and the following year made several additional changes to
the FSS program to implement amendments made by the Housing and
Community Development Act of 1992 (Pub. L. 102-550), approved October
28, 1992 (the 1992 Act). (See section 106 of the 1992 Act.) On May 27,
1993, HUD issued an interim final rule implementing the FSS program in
its Indian Housing program at 24 CFR part 905, Public Housing program
regulations at 24 CFR part 962, and Section 8 program regulations at 24
CFR part 984. 56 FR 49588. On March 5, 1996, HUD streamlined the FSS
program by consolidating the Public
[[Page 59235]]
Housing and the Section 8 FSS regulations and by eliminating redundant
or otherwise unnecessary provisions into 24 CFR part 984. 61 FR 8814.
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\2\ ``Notice of FSS Program Guidelines'' September 30, 1991 at
56 FR 49592.
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On October 26, 1996, the Native American Housing Assistance and
Self-Determination Act of 1996 (NAHASDA) (25 U.S.C. 4101 et seq.)
amended the United States Housing Act of 1937 by removing the language
applying the FSS program to IHAs. HUD subsequently removed the FSS
regulations applicable to the Indian Housing program. 63 FR 12334.
Lastly, on March 29, 2000, HUD implemented changes to the FSS program
made by the Quality Housing and Work Responsibility Act of 1998 (title
V of the FY 1999 HUD Appropriations Act, Pub. L. 105-276, 112 Stat.
2518, approved October 21, 1998), which amended the United States
Housing Act of 1937 (42 U.S.C. 1437, et seq.) by changing the
definition of welfare assistance, the minimum program size, action
plan, and portability. 65 FR 16691.
More recently, the 2015 Consolidated Appropriations Act (Pub. L.
113-235), approved December 26, 2014, authorized a demonstration of the
FSS program for multifamily assisted housing owners. In August 2016,
HUD provided the requirements for multifamily assisted housing owners
seeking to implement a voluntary FSS program by notice. See Family
Self-Sufficiency Program in Multifamily, Housing Notice: H-2016-08,
August 26, 2016. The notice incorporated many of the definitions and
requirements that are found in 24 CFR part 984 and applied them to the
voluntary FSS program for multifamily owners.
On May 24, 2018, the Economic Growth, Regulatory Relief, and
Consumer Protection Act (the ``Economic Growth Act'') was signed into
law (Pub. L. 115-174), and section 306 of title III, Protection for
Veterans, Consumers and Homeowners, amended the United States Housing
Act of 1937 (42 U.S.C. 1437, et seq.), FSS program. The changes include
updating the mandatory size of a PHA's required FSS program and
available exceptions; updating definition of eligible families;
allowing family members other than the Head of Household to sign the
Contract of Participation (CoP) and to meet the employment obligation;
amending the process for providing supportive services; expanding the
time period for participating in the FSS program; amending the
requirements pertaining to the management of the escrow account,
including the requirements for forfeiture of the escrow funds; amending
the Program Coordinating Committee (PCC) functions; and, establishing
new reporting requirements. Also, the Economic Growth Act provided new
provisions for private owners of multifamily assisted housing to set up
their own FSS program or enter into a Cooperative Agreement with
another private owner or PHA to offer an FSS program to the owner's
assisted residents.
II. This Proposed Rule--Summary of Changes
This proposed rule implements changes and streamlines the FSS
program, removes any reference to the certificate program and updates
definitions, as required by the Economic Growth Act. HUD makes changes
to the existing FSS regulations at 24 CFR part 984 and adds a new 24
CFR part 887 to address the FSS program for owners of multifamily
assisted housing. HUD also updates references to PHAs and owners and
clarifies the provisions that would apply to both when operating an FSS
program. Owners would be subject to the requirements only if they are
operating a voluntary program pursuant to cross-references in 24 CFR
part 887. The following describes the significant changes to the
regulation:
The Public Housing FSS Program
Sec. 984.101 Purpose, Applicability, Scope
The purpose and applicability in Sec. 984.101 has minor technical
changes. The scope of the regulations, paragraph (c), is amended by
removing subsections (1), (2), (3)(i), and (3)(ii) and by adding a
generic reference to Sec. 984.105, which provides that PHAs must
continue an FSS program if they were required to have one as of May 24,
2018. Therefore, the citation to specific fiscal year (FY) funding is
removed and replaced by a general requirement that PHAs receiving
funding under section 8(o) and section 9 are required to comply with
Sec. 984.105. A non-participation paragraph is also added to this
section, to clarify that a family's rental assistance shall not be
delayed or terminated by reason of a family electing not to participate
in an FSS program.
Sec. 984.102 Program Objectives
HUD makes a minor amendment to this section, including a change
clarifying that HUD will evaluate the performance of a local FSS
program using a scoring system that measures graduation from the
program, increased earned income, program participation, and similar
factors, as provided by HUD through a Federal Register notice.
Sec. 984.103 Definitions
The proposed rule streamlines and adds clarity to the definition of
eligible families. The term ``eligible families'' is defined under the
proposed rule as current Public Housing residents and families
receiving tenant-based or project-based assistance under section 8(o).
This means that participants in the Housing Choice Voucher (HCV)
homeownership program (under section 8(y) of the U.S. Housing Act of
1937) are not eligible to participate in the FSS program. However,
participants in the Project Based Voucher (PBV) program (under section
8(o)(13) of the U.S. Housing Act of 1937) are eligible to participate.
The proposed regulations include definitions for ``owner'' and
``multifamily assisted housing'' to clarify the newly expanded
applicability of regulations for owners of multifamily assisted housing
(also known as Project-Based Rental Assistance (PBRA)) under section 8
of the 1937 Act.
Similarly, the following terms have been added to provide clarity
to the process of calculating an FSS family's escrow: ``baseline annual
earned income''; ``baseline monthly rent''; ``current annual earned
income''; and ``current monthly rent.'' In the definition of baseline
annual earned income, the proposed rule instructs PHAs and owners to
add back any disregard of earned income associated with self-
sufficiency initiatives that may be applicable in the determination of
family income. This will help ensure that escrow amounts are the result
of increases in earned income while the family is in the FSS program
(as opposed to credit for progress made before entering the FSS
program). Additionally, the definitions of ``baseline monthly rent''
and ``current monthly rent'' take into account the use of flat rents
and ceiling rents for Public Housing families. This ensures that
families paying a flat rent or ceiling rent that is less than their
income-based rent will escrow only up to the amount of rent that they
are actually paying (flat/ceiling rent). A definition for the term
``FSS family in good standing'' has been added because this term is
used in Sec. 984.305(c)(1) and (f)(2) of the proposed rule.
Section 306 of the Economic Growth Act changes the requirement that
a PHA directly deliver supportive services, to requiring that a PHA or
owner must only coordinate the availability of supportive services but
not directly deliver. Also, section 306 makes slight changes to the
list of supportive services that may be coordinated through the FSS
program. The proposed rule revises
[[Page 59236]]
the definition of supportive services to conform to these statutory
changes.
The following terms have been revised to conform to changes
described later in this preamble: ``FSS family,'' ``FSS slots,'' ``head
of the FSS family,'' and ``Individual Training and Services Plan''
(ITSP). In addition, the following terms have been removed because they
refer to obsolete programs that are no longer referenced in the
regulation: Job Opportunities and Basic Skills Training (JOBS) and Jobs
Training and Partnership Act (JTPA) programs. The Economic Growth Act
changed the term of the FSS contract so an FSS family will be required
to fulfill their obligations under the CoP no later than 5 years after
the first recertification of income after the execution date of the
contract. HUD is revising the definition of the effective date of the
CoP from the first day of the month following the month in which the
parties executed the contract to the date the parties execute (sign)
the contract.
Question 1: HUD requests feedback on how the proposed rule defines
the effective date of the CoP. Specifically, are there rent or other
implications which would cause the proposed definition to be an issue?
Sec. 984.104 Basic Requirements of the FSS Program
The proposed rule revises Sec. 984.104 to add reference to the
regulatory citations for the program.
Sec. 984.105 Minimum Program Size
Some PHAs are statutorily required to operate an FSS program as a
result of accepting increased funding for vouchers and Public Housing
between the inception of the FSS program in 1990 and the Quality
Housing and Work Responsibility Act in 1998. Current regulation
addresses the minimum program size separately for the Public Housing
FSS and the Section 8 FSS programs; however, FSS funding streams have
been combined since the Consolidated Appropriations Act, 2014, Public
Law 113-76, 128 Stat. 5, enacted January 17, 2014. This unification of
the FSS program is further reflected in section 306 of the Economic
Growth Act. The proposed rule revises the provisions concerning the
determination of the minimum program size to conform to the unified FSS
program. Specifically, the proposed rule clarifies that when
determining the minimum program size (i.e., the minimum number of
families that a PHA must serve in its FSS program), the relevant figure
is the total number of Public Housing units plus the total number of
Section 8 units. The provisions concerning how to calculate the
reduction in the total number of Public Housing units and Section 8
units over time, as used to determine the minimum FSS program size,
remain the same. Therefore, the proposed rule replaces the complex
formula for determining a PHA's program size with the language from the
statute indicating that a PHA's program size must equal the total
number of families required to be served as of May 24, 2018, as a
starting point.
PHAs should continue to use the formula that HUD issued in its
final rule on March 5, 1996, 61 FR 8815, consistent with the statutory
requirement that as of October 1, 1992, the Secretary shall require
PHAs that administer assistance under subsection (b) or (o) of 42
U.S.C. 1437f or makes available new public housing dwelling units, to
carry out a local FSS program.
The proposed rule maintains reference to the reduction of the
minimum program size in Sec. 984.105(b)(2). Specifically, the proposed
rule revises that paragraph to allow for a reduction of the minimum
program size by one slot for each family that graduates from the FSS
program, from either rental assistance program (Public Housing or
Section 8) by fulfilling its FSS CoP on or after October 21, 1998. This
change conforms to section 306 and to HUD's implementation of FSS
alternative requirements in the Waivers and Alternative Requirements
for the FSS Program Federal Register Notice (79 FR 78100, December 29,
2014).
The proposed rule also conforms to the list of local circumstances
that make it unfeasible for a PHA to operate an FSS program and for
which the PHA may get HUD approval for an exception to program
operation or an exception to operate a smaller program. HUD has taken
this opportunity to change the duration of any HUD-approved exception
from 3three years to five years. HUD proposes that an increase of HUD-
approved exceptions to five years is a more reasonable timeframe and
provides for PHAs at the end of such period, to restart the exception
approval process (if seeking to continue the exception). Additionally,
if circumstances change within those five years, PHAs are not required
to carry through the exception for the full five years.
Question 2: HUD welcomes feedback regarding this change.
Specifically, do commenters agree that five years is a more reasonable
duration for a HUD-approved exception? Or is there another timeframe
that would more accurately balance changes in circumstances and the
PHA's administrative responsibilities at the end of the exception?
Sec. 984.106 Cooperative Agreements
Section 306 of the Economic Growth Act provides that a PHA may
enter into a Cooperative Agreement with one or more owners of
multifamily properties to voluntarily make an FSS program available to
the owner's assisted tenants. The PHA would manage the service
coordination for eligible families that are covered under the
Cooperative Agreement. This new section would provide that in addition
to complying with the rest of part 984, the PHA administering the FSS
program must do so in accordance with the requirements in this section.
Those requirements are as follows: (1) FSS program waiting lists must
be open to all eligible families residing in the multifamily properties
covered by the Cooperative Agreement; (2) escrow amounts must be
managed by each owner, including calculating and tracking of the escrow
must be done in accordance with Sec. 984.305; (3) an owner's assisted
families covered by the Cooperative Agreement may be part of the
calculation of the FSS award under Sec. Sec. 984.107 and 984.302; (4)
FSS funds awarded to the PHA may be used by the PHA to serve an owner's
assisted families covered by the Cooperative Agreement; and (5) the
Cooperative Agreement must clearly specify the terms and conditions of
such agreement.
Question 3: HUD specifically requests comments on whether this list
is comprehensive or if other items should be required of PHAs and
owners entering into a Cooperative Agreement.
Sec. 984.107 FSS Award Funds Formula
Section 306 of the Economic Growth Act provides the Secretary the
authority to award funds by formula and set forth new procedures and
processes. This section incorporates the statutory language providing
that the Secretary may establish a formula by which funds for
administration of the FSS program are awarded and indicating any
changes to such formula, as permitted by statute, are accomplished by
notice in the Federal Register.
Sec. 984.201 Action Plan
Technical revisions to the list of parties who should be consulted
in developing an action plan and the contents of the plan are included
in this section of the proposed rule, to conform with the slight
changes under section 306 of the Economic Growth Act. Additionally,
since all PHAs would have already submitted an FSS Action Plan, HUD has
taken this opportunity to
[[Page 59237]]
remove the reference to the initial submission of an FSS Action Plan
for PHAs with mandatory programs. The section also indicates that
owners operating a voluntary FSS program would be required to have an
approved FSS Action Plan but distinguishes the level of consultation
required of PHAs versus owners. This distinction, on FSS requirements
for owners in 24 CFR part 887, is discussed further below.
Sec. 984.202 Program Coordinating Committee (PCC)
HUD takes this opportunity to revise the provisions concerning
required PCC membership to streamline, simplify, and unify such
provisions. Specifically, the proposed rule would continue to require
representatives from the participating PHA to be members of the PCC and
require an FSS Coordinator or Coordinators to be PCC members as well.
Additionally, the proposed rule would require that at least one
resident participant from each HUD-assisted program served by FSS is a
member of the PCC. PHAs would no longer be required to formally solicit
such participants from the resident groups identified in the
regulation. Rather, PHAs may seek such group's assistance, if needed,
to identify such participants.
The provisions concerning recommended membership in Sec.
984.202(b)(2) and alternative committees in Sec. 984.202(c) have also
been revised to conform to changes made in section 306 of the Economic
Growth Act. Specifically, reference to the JOBS and JTPA programs have
been replaced with reference to programs under the Workforce Innovation
and Opportunity Act. In addition, at least one participant of each HUD-
assisted program served by FSS must be consulted in determining whether
to use an existing entity as the PCC.
Sec. 984.302 FSS Funds
This rule adds that a PHA or owner may use FSS funds for costs
associated with families who are enrolled in an FSS program under this
part, including through a Cooperative Agreement with an owner of
multifamily assisted housing in accordance with Sec. 984.106.
Sec. 984.303 Contract of Participation
The Economic Growth Act revises the requirement that the Head of
Household (for rental assistance purposes) must be the person to
execute the Contract of Participation (CoP). Instead, it allows any
adult member of the FSS family to execute the CoP. The proposed rule
revises paragraph (a) to incorporate this change and clarifies that an
adult family member, as designated by the FSS family in consultation
with the PHA or owner, is eligible to execute the contract.
Question 4: While HUD has carefully considered all areas of the
regulation that are impacted by this change, and revised them
accordingly, HUD requests comment on whether there are other places
that such clarification should be included.
The proposed rule revises the amount of time a family must be
independent from welfare assistance prior to expiration of the CoP, in
Sec. 984.303 (b)(2). Currently, one of the required goals for a family
is that it must be independent from welfare assistance for 12 months
before the expiration of the FSS CoP. In this proposed rule, a family
must be independent from welfare at the time of graduation from FSS but
not independent for a specified time period prior to graduating from
the FSS program. This change would ensure that an FSS family's
successful graduation, and access to escrow funds, is not jeopardized
if they do not meet the 12-month time period, if the family has worked
successfully towards all the other goals. It also provides some
administrative relief to PHAs and owners who would no longer have to
ensure that families have met the 12-month time period. HUD welcomes
feedback regarding this change. Specifically:
Question 5: Would commenters recommend giving PHAs the discretion
to set a specified time period (up to a maximum)? Is 12 months a
reasonable maximum? What are some of the benefits and challenges PHAs
face with the current 12-month time period?
Question 6: How would requiring families to be independent from
welfare for a specified time period link with Temporary Assistance for
Needy Families (TANF) requirements? How would it enhance or obstruct
such requirements?
Question X: Would removing the 12-month requirement decrease the
incentive for participants to permanently stay off welfare?
HUD adds language in paragraph (b)(2) that the FSS family goals
must comply with the parameters of the FSS terms and conditions as
prescribed by HUD, and the PHA or owner may not modify or add
additional required activities that must be completed by every
participant. Specifically, HUD requires that the CoP represent an
individualized training and service plan, and, thus, PHAs and owners
should not require a certain number of hours, rate of pay, or other
mandatory requirements that apply to all participants across the board.
Consistent with the change to paragraph (a), paragraph (b)(4) is
changed to reflect that employment must be maintained by the head of
the FSS family, not the Head of Household, consistent with the
statutory change permitting participation in the FSS program by any
adult member of the family. Also, as required by the Economic Growth
Act, HUD is deleting Sec. 984.303(b)(5)(iii), which currently
indicates that the PHA could terminate or withhold the family's Section
8 assistance for non-compliance with the COP. Eliminating the ability
of a PHA to terminate or withhold assistance is expected to incentivize
greater participation in the FSS program. With respect to 984.303(d),
HUD proposes to expand the definition of ``good cause'' for a contract
extension in paragraph (d), to include the active pursuit of a goal
that will further self-sufficiency, such as a college degree or credit
repair program. Additionally, any extension of the contract must be
made pursuant to a current or additional stated goal for the FSS
family.
Question 7: HUD requests comments on whether this definition should
be clarified to include additional circumstances, like serious illness
or involuntary loss of employment, which are already causes for
extension.
Paragraph (g) is amended to remove the provision that automatically
completes the FSS contract when thirty percent (30%) of the family's
adjusted monthly income equals or exceeds the Fair Market Rent (FMR).
HUD believes that the thirty percent (30%) provision no longer aligns
effectively with current HCV requirements and creates confusion among
FSS coordinators and partners. Removal of this provision would allow
FSS families to use the FSS program to its full potential.
Question 8: HUD requests comments on the removal of this automatic
completion provision; and, whether there are circumstances where an FSS
contract should be automatically completed.
The section has a new paragraph (k) that discusses the
nullification of a CoP. Nullification would occur when the PHA or owner
determines that services integral to an FSS family's advancement
towards self-sufficiency are unavailable or when the head of the FSS
family becomes permanently disabled and unable to work or dies during
the period of the contract, unless the PHA or owner and the FSS family
determine that it is possible to modify the contract to designate a new
head of the FSS family. The new paragraph describes the management of
the escrow funds in the case of nullification.
[[Page 59238]]
Question 9: HUD requests comments about the language added
regarding the handling of escrow funds in the case of nullification.
Sec. 984.304 Amount of Rent Paid by FSS Family and Increases in Family
Income
The proposed rule revises the provision concerning increases in
family income. Prior to the Economic Growth Act, an FSS family's
increases in earned income during their participation in FSS could not
be considered as income or a resource for eligibility for other
benefits, or amount of benefits payable to the family, under any HUD
program, unless the family income equaled or exceeded 80 percent of the
area median income. The Economic Growth Act removes this last provision
and allows an FSS family's increases in earned income during their
participation in FSS to be excluded as income or a resource regardless
of whether the family income equals or exceeds 80 percent of the area
median income. Additionally, HUD streamlines this section by removing a
reference to the calculation of rent for the rental certificate
participants because the certificate program is obsolete and adds the
regulatory citations for calculation of rent for the PBV program.
Sec. 984.305 FSS Account
Section 984.305(a)(2)(i) of the current regulation requires that,
during the term of the FSS contract, the PHA credits the escrow amount
to each family's FSS account periodically but not less than annually.
The proposed rule revises and clarifies the requirement by
differentiating between ``determining the FSS escrow amount'' and
``crediting that FSS escrow amount'' to a family's FSS account. Under
the proposed change, during the term of the CoP, the PHA must determine
the monthly escrow credit amount at each reexamination of income
occurring after the effective date of the CoP. That amount is then
deposited (i.e., credited) every month into each family's FSS account.
This change aligns the calculation of the FSS escrow amount with the
timing of the family's reexamination of income and provides the ability
to report real-time information on a family's FSS account. The
requirement to provide an FSS escrow account report to the family, at
least annually, has not changed; however, a family may inquire about
their FSS escrow balance at any time.
Question 10: Is the proposed frequency of depositing escrow amounts
to a family's FSS account reasonable? Should HUD consider another
frequency, and why?
Question 11: Current regulations do not address whether escrow
should be credited to a family's FSS account if the family does not pay
rent on time. HUD requests comments on whether the family's FSS account
should be credited for late payments. Please provide comments both on
regulation and on how the regulation could be implemented, especially
in the case of the voucher programs where rent is paid to landlords and
not directly to the PHAs.
The proposed rule revises the provision concerning reduction of
amounts due by the FSS family under paragraph (a)(2)(iii) of this
section. Under current regulation, the balance on a family's FSS escrow
account must be reduced before prorating the interest income, by
amounts not paid by the family for rent, or any other amounts due by
the family under the applicable housing program. Such amounts are also
reduced from a family's FSS escrow balance at the time of final escrow
disbursement. The proposed rule no longer requires that the balance on
a family's escrow account be reduced by these amounts each time
interest income is prorated. Instead, the total balance on a family's
FSS escrow account (including interest accrued over the life of the
escrow account) is reduced by such amounts only at the time of final
escrow disbursement in accordance with Sec. 984.305(c). HUD believes
that the regulation appropriately addresses amounts due by the family
by adjusting the family's FSS escrow balance only at the time of final
escrow disbursement. This change also streamlines management of the FSS
escrow account and provides administrative relief to FSS PHAs and
owners.
HUD is proposing to address the requirements concerning updating
income information prior to the execution of an FSS CoP. Current FSS
regulations do not address this requirement; however, the FSS CoP (form
HUD-52650) requires PHAs to conduct an income recertification if more
than 120 days have passed between the effective date of the last income
recertification and the effective date of the CoP. HUD believes this is
best left to PHA/owner discretion and is adding language to Sec.
984.305(b)(1) to explicitly afford PHAs and owners discretion to decide
whether to conduct a new income recertification if more time than the
period specified by the PHA or owner has passed between the effective
date of the last income recertification and the effective date of the
CoP.
Question 12: While HUD recognizes that owners would not have the
same flexibility that PHAs have for this type of income
recertification, HUD requests comments from the public as to whether
this should be available to multifamily owners as it is for PHAs.
Pursuant to the Economic Growth Act, Sec. 984.305(b) is revised to
update the calculation of the escrow amount and to remove any language
that does not conform with the Act. Specifically, the statute, and the
proposed rule, removes any difference in the calculation of escrow
between very low-income and low-income families. HUD has also taken the
opportunity to further update and streamline the escrow calculation.
The proposed rule no longer differentiates in how family rent is
defined for the Public Housing and the HCV programs. Instead, the
proposed rule adds a new set of definitions, as described in Sec.
984.103 of this preamble, to provide further clarity to the process of
calculating the escrow credit. The proposed rule changes the
calculation of escrow to the lower of: (i) Thirty (30) percent of one-
twelfth (1/12) (i.e., two and a half (2.5) percent) of the amount by
which the family's current annual earned income exceeds the family's
baseline annual earned income; or (ii) the amount by which the family's
rent has increased. This calculation ensures that the FSS escrow credit
is limited to increases in the amount of rent paid by the family that
is attributable to increases in earned income. In the first part of the
calculation, one-twelfth is used to calculate the growth in monthly,
instead of annual, earned income, and 30 percent is used because that's
the percentage of adjusted income generally used to determine the
family's monthly rent.
The second part of the calculation, which looks at increases in the
family's rent, uses the lower of: (A) The amount by which the family's
current monthly rent exceeds the family's baseline monthly rent; (B)
for HCV families, the difference between the baseline monthly rent and
the current gross rent (i.e., rent to owner plus any utility allowance)
or the payment standard, whichever is lower; or (C) for PBV families,
the difference between the baseline monthly rent and the current gross
rent (i.e., rent to owner plus any utility allowance). This ensures
that families are not escrowing more than the current gross rent for
the unit (i.e., rent to owner plus any utility allowance) or the
payment standard (for HCV families). And, it more accurately applies
HCV and PBV rent rules to the calculation of escrow.
[[Page 59239]]
To put it another way: If a family has no change in earned income,
but rent does go up for whatever reason (flat rent is recalculated, a
non-income-based rent increase kicks in, an income disregard ends,
increase in non-earned income, decrease in deductions, etc.), the
paragraph (i) calculation will be lower. Or, a family has a change in
earned income, but rent does NOT go up (due to flat rent, ceiling rent,
income disregard, or some other non-income-based rent model) then the
paragraph (ii) calculation will be lower.
HUD will update the current FSS escrow calculation worksheet
applicable to HCV and Public Housing families to conform with the
regulatory changes and to provide further clarity. HUD has made
available a copy of the revised worksheet with this proposed rule in
Appendix A. To review and test the proposed Sample FSS Escrow
Calculation Worksheet, please find on the HUD FSS web page: https://www.hud.gov/program_offices/public_indian_housing/programs/hcv/fss.
Please submit comments on the proposed worksheet using the same process
as commenting on the Proposed Rule. The Housing office will be creating
a similar calculation worksheet that reflects any differences in escrow
calculation in the multifamily program.
Question 13: Does the streamlined escrow calculation, as reflected
in the regulation and the revised escrow calculation form, effectively
simplify the calculation of escrow? Are there elements of the
calculation that should be done differently? This includes how to
address alternatives to income-based rents and any other specific
situations you may encounter at your PHA. If so, why and how? For PBRA
Owners--please comment on any sections of the escrow calculation
worksheet that should be modified for PBRA FSS participants. Please
submit proposed edits to the form if needed.
Section 984.305(b)(4) is also revised to address the impact on
escrow for HCV families who are in the process of moving to a new unit,
in accordance with HCV program requirements, and that are not under a
lease during that time. Specifically, Sec. 984.305(b)(4) is revised to
clarify that escrow credits cease during the HCV family's search period
if the family is not under a lease. Escrow credits resume once the
family finds a unit and enters into a lease. HUD interprets the FSS
statute as requiring the payment of rent by a family in calculating the
amount of the family's escrow credit. Similarly, the FSS statute
provides that an eligible entity may use funds it controls under
section 8 for purposes of making the escrow deposit for participating
families, if those funds are offset by the increase in the amount of
rent paid by the family. Such an offset would not be possible if the
family is not under a lease and, consequently, not paying rent.
Section 984.305(f) currently provides that escrow funds are
forfeited when the FSS contract is nullified under Sec. 984.303(e), in
cases where supportive services integral to the FSS family are
unavailable to the FSS family. HUD proposes to change the policy and
allow escrow funds to be disbursed to the FSS family in the case of a
nullified contract. HUD believes that disbursement of escrow funds is
justified because nullification of the CoP under these circumstances is
at no fault of the family. Paragraph (c)(3) has been added to address
this change and paragraph (f) has been modified to remove reference to
forfeiture of escrow for nullified contracts.
Paragraph (f) is amended to conform with the statutory change under
the Economic Growth Act, which provides that forfeited FSS escrow funds
must be used for the benefit of FSS participants in good standing. The
section provides the following list of activities for which forfeited
escrow funds may be used: Support for FSS participants in good
standing; training for program coordinators; and, other eligible
activities as determined by the Secretary. A list of ineligible uses
will be included.
Question 14: HUD requests comment on what definition should apply
for ``participants in good standing'' and whether HUD should add items
to the eligible activities list for which forfeited escrow funds may be
used?
Sec. 984.306 HCV Portability Requirements
HUD has taken this opportunity to change several provisions
concerning FSS families that move with continued HCV assistance from
the jurisdiction of one PHA to the jurisdiction of another PHA under
portability. This section of the proposed rule seeks to carefully
balance the complexities of a portability move, the shared FSS
responsibilities between PHAs, and giving the FSS family that ports the
best opportunity to successfully complete the FSS program. In addition
to the changes described in the following paragraphs, editorial changes
have been made to this section for clarity.
Under the current FSS regulation, a receiving PHA may, at its
discretion, enroll into its FSS program an FSS family that ports into
its jurisdiction. And, the initial PHA may determine that an FSS family
that ports may continue to participate in the initial PHA's FSS
program, if the FSS family demonstrates to the satisfaction of the
initial PHA that the family will be able to fulfill its
responsibilities under the FSS contract. The proposed rule revises this
framework, by instead requiring that the receiving PHA enroll into its
FSS program FSS families that port, unless the receiving PHA and the
initial PHA agree to the family's continued participation in the
initial PHA's FSS program. This change facilitates the continuity of
services and case management to the family, it facilitates the family's
move, and it prevents the potential loss of escrow funds. The change
also recognizes that each PHA retains responsibility for certain FSS
tasks after a portability move; therefore, receiving PHAs should have
input on whether the family may continue to participate in the initial
PHA's FSS program. Additionally, since this change is only applicable
to families that were already enrolled in FSS prior to the portability
move, HUD expects that this change will only impact a small number of
families and PHAs.
The proposed rule addresses a scenario, not previously addressed in
the regulation, in which a relocating FSS family moves to a receiving
PHA that does not administer an FSS program. Under the proposed rule,
continued FSS participation under this scenario is not possible. The
proposed rule recognizes that there may be several options (for
example, modification of the FSS contract to graduate the family,
termination of the FSS contract and forfeiture of escrow, or locating a
receiving PHA that administers an FSS program) available to the family
and requires that the initial PHA discuss those options with the family
for them to make a fully informed decision. Continued FSS participation
under these circumstances is not possible because the receiving PHA
would be responsible for certain FSS tasks after the move (even if the
family continues to participate in the initial PHA's FSS program), and
it would be burdensome to require a receiving PHA to manage such tasks
for a small number of FSS families, especially in light of the
administrative complexity of a portability move, which would be further
complicated by the shared FSS responsibilities between PHAs.
Another situation not previously addressed in the regulation is
also addressed in the proposed rule. That is, when a family who was not
enrolled in FSS before the move requests enrollment in the receiving
PHA's FSS program. The proposed rule states that if the receiving PHA,
at their discretion,
[[Page 59240]]
absorbs the family into its HCV program, the receiving PHA may, also at
their discretion, enroll the family into its FSS program. Receiving
PHAs must consistently apply their existing FSS enrollment policies to
families who have ported into their jurisdiction and request to enroll
in the receiving PHA's FSS program. If the receiving PHA will bill the
initial PHA for the housing assistance payments, the family cannot
enroll in the receiving PHA's FSS program. This restriction recognizes,
as mentioned previously, the administrative complexity of a portability
move may be further complicated by the shared FSS responsibilities
between PHAs, and the potential inefficiencies in the administration of
the FSS contract.
Question 15: HUD requests comment on these proposed changes and
additions to the FSS portability provisions and whether there are more
effective ways to address the balance between the administrative
complexity for the PHA and the family's desire to participate in FSS.
Sec. 984.401 Reporting
The reporting section is amended to reflect the statutory
requirement that reports include the number of families enrolled and
graduated, and the number of established escrow accounts and positive
escrow balances.
Multifamily Housing FSS Program
The Multifamily Housing FSS program's new subpart has eight
sections that mirror the FSS program in 24 CFR part 984. The sections
are listed as the following:
Sec. 887.101 Purpose, Scope, and Applicability
This section provides for the purpose, scope, applicability, and
provision on tenant nonparticipation. Consistent with 24 CFR part 984,
the purpose of the FSS program for multifamily owners is the same as
for PHAs, to promote the development of local strategies to coordinate
the use of HUD assistance with public and private resources and to
enable families eligible to receive HUD assistance to achieve economic
independence and self-sufficiency. The new 24 CFR part 887 regulations
provide the requirements that an owner must follow if the owner decides
to implement an FSS program independently or by way of a Cooperative
Agreement with a PHA or another owner. The new 24 CFR part 887
regulations are not applicable to PHAs that must follow 24 CFR part
984. Lastly, the section provides that tenant participation in an FSS
program is voluntary, and an owner must not delay or terminate
assistance under Section 8 for a family that elects not to participate
in an FSS program.
Sec. 887.103 Definitions
The definitions for multifamily assisted housing are the same as
those for PHAs in Sec. 984.103, except that eligible families in 24
CFR part 887 means tenants of multifamily assisted housing.
Sec. 887.105 Basic Requirements for FSS Program
HUD implemented a voluntary FSS program for multifamily assisted
housing through notice H 2016-08; the notice incorporated many of the
provisions of 24 CFR part 984. For consistency among voluntary FSS
programs, HUD proposes to make the FSS program requirements for
multifamily assisted housing consistent with PHA requirements. These
requirements will apply to both existing and new FSS programs.
Specifically, an FSS program would be required to operate in conformity
with the regulations of 24 CFR part 887 and other Section 8
regulations, as applicable. Those 24 CFR part 984 requirements are as
follows: (1) Coordination of supportive services as defined in Sec.
984.103; (2) creation of an approved Action Plan, as described in Sec.
984.201, before operating an FSS program; (3) handling FSS funds
consistent with Sec. 984.302; (4) entering into a CoP with eligible
families, Sec. 984.303; (5) management of escrow accounts, as
described in Sec. 984.305; reporting information pursuant to Sec.
984.401; and (6) operated in compliance with the nondiscrimination and
equal opportunity requirements set forth in 24 CFR part 5. This section
provides as follows: (1) Owners are permitted to make available and
utilize onsite facilities, as set forth in Sec. 984.204; and (2)
owners may employ appropriate staff, including a program coordinator to
administer its FSS program, and may contract with an appropriate
organization to establish and administer parts of the FSS program as
provided by Sec. 984.305.
The section requires consultation with a Program Coordinating
Committee (PCC) in creating an Action Plan, but it does not require the
creation of a PCC under Sec. 984.202. The multifamily assisted housing
regulation does not include minimum program size requirements at Sec.
984.105 since FSS programs are voluntary; the formula award section
applying only to mandatory programs at Sec. 984.107; the family
selection process at Sec. 984.203; and the portability requirements at
Sec. 984.306. All other provisions are adopted either in part or in
whole in its application to multifamily assisted housing.
Question 16: HUD specifically asks for comments on whether the
exclusion or inclusion of certain requirements for the multifamily
assisted housing regulation is appropriate. Specifically, HUD excluded
the family selection process at Sec. 984.203 because HUD does not
believe those requirements would be necessary due to the size of most
multifamily assisted housing FSS programs. Additionally, HUD excluded
the creation of a PCC because it was not statutorily required for
owners in the FSS statute, but HUD does believe that coordination with
some of the members of a PCC is essential in developing an Action Plan
and successfully implementing an FSS program.
Sec. 887.107 Cooperative Agreements
Section 306 of the Economic Growth Act provides that owners may
enter into Cooperative Agreements with a PHA or other owner to offer an
FSS program to their tenants. An owner entering into a Cooperative
Agreement with a PHA must follow the requirements provided in Sec.
984.106. An owner entering into a Cooperative Agreement with another
owner must do so in accordance with the requirements in this section.
The requirements are as follows: (1) Waiting lists must be open to all
eligible families residing in the properties covered by the Cooperative
Agreement; (2) provide that escrow amounts are handled by each owner
and the calculating and tracking of escrow must be done in accordance
with Sec. 984.305; and (3) the Cooperative Agreement must clearly
specify the terms and conditions of such agreement.
Question 17: HUD specifically requests comments on whether this
list is comprehensive or if other items should be required of owners
entering into a Cooperative Agreement.
Sec. 887.109 Housing Assistance and Total Tenant Payment and Increases
in Family Income
This section mirrors Sec. 984.304 and provides that housing
assistance payments for FSS families are the same as those provided to
any other tenant living in the property. Paragraph (b) provides the
process for determining total tenant payment. Paragraph (c) provides
that when an FSS family's income increases during its participation in
an FSS program, the increase may not be considered as income or a
resource for purposes of eligibility of the FSS family for other
benefits, or amount of benefits payable
[[Page 59241]]
to the FSS family, under any other program administered by HUD. For
multifamily assisted housing, money that goes into escrow is offset by
additional housing assistance payment (HAP) to the owner from HUD as a
positive adjustment to the monthly voucher.
Sec. 887.111 FSS Award Funds Formula
Section 306 of the Economic Growth Act provides the Secretary the
authority to award funds by formula and set forth new procedures and
processes. This section incorporates the statutory language providing
that the Secretary may establish a formula by which funds for
administration of the FSS program are awarded and indicating any
changes to such formula, as permitted by statute, are accomplished by
notice in the Federal Register. This section mirrors Sec. 984.107.
IV. Findings and Certifications
Regulatory Review--Executive Orders 12866 and 13563
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health, and safety effects; distributive impacts; and equity).
Executive Order 13563 emphasizes the importance of quantifying both
costs and benefits, reducing costs, harmonizing rules, and promoting
flexibility.
Under Executive Order 12866 (Regulatory Planning and Review), a
determination must be made whether a regulatory action is significant
and; therefore, subject to review by the Office of Management and
Budget (OMB), in accordance with the requirements of the order. This
rule was determined to be a ``significant regulatory action'' as
defined in section 3(f) of the Executive Order, but not an economically
significant regulatory action, as provided under section 3(f)(1) of
Executive Order 12866. Consistent with Executive Order 13563, this rule
implements the streamlining requirements of section 306 and provides
additional flexibility for PHAs and multifamily owners. HUD has
prepared an initial Regulatory Impact Analysis (RIA) that addresses the
costs and benefits of the proposed rule. HUD's RIA is part of the
docket file for this rule.
The docket file is available for public inspection in the
Regulations Division, Office of General Counsel, Room 10276, 451 7th
Street SW, Washington, DC 20410-0500. Due to security measures at the
HUD Headquarters building, please schedule an appointment to review the
docket file by calling the Regulations Division at 202-402-3055 (this
is not a toll-free number). Individuals with speech or hearing
impairments may access this number via TTY by calling the Federal Relay
Service at toll-free 800-877-8339.
Executive Order 13771
Executive Order 13771, entitled ``Reducing Regulation and
Controlling Regulatory Costs,'' was issued on January 30, 2017. Section
2(a) of Executive Order 13771 requires an Agency, unless prohibited by
law, to identify at least two existing regulations to be repealed when
the Agency publicly proposes for notice and comment or otherwise
promulgates a new regulation. In furtherance of this requirement,
section 2(c) of Executive Order 13771 requires that the new incremental
costs associated with new regulations shall, to the extent permitted by
law, be offset by the elimination of existing costs associated with at
least two prior regulations. For the reasons discussed in the
Regulatory Impact Analysis, this proposed rule has been determined to
be an Executive Order 13771 deregulatory action.
Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
3501-3520), an agency may not conduct or sponsor, and a person is not
required to respond to, a collection of information unless the
collection displays a valid control number. The information collection
requirements contained in this proposed rule have been submitted to the
Office of Management and Budget (OMB) under the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501-3520) and assigned OMB control number 2577-
0178.
The proposed rule would require changes to the existing approved
paperwork to include multifamily, addition of a Notice of Funding
Availability (NOFA) narrative, and the Cooperative Agreement. The
overall reporting and recordkeeping burden are estimated as follows:
---------------------------------------------------------------------------
\3\ Burden hours for forms showing zero burden hours in this
collection are reflected in the OMB approval number cited or do not
have a reportable burden.
----------------------------------------------------------------------------------------------------------------
Description of information Number of Responses per Total annual Hours per
collection responses year responses response Total hours
----------------------------------------------------------------------------------------------------------------
SF-424--Application for Federal 750 1 750 0.75 563
Assistance.....................
SF-LLL--Disclosure of Lobbying 40 1 40 0.17 7
Activities.....................
Form HUD 2880--Applicant, 800 1 800 0 0
Recipient, Disclosure, Update
Form (OMB No. 2510-0011) \3\...
NOFA Narrative.................. 20 1 20 10 200
Cooperative Agreements.......... 15 1 15 2 30
Form HUD-52755--Sample Contract 20 1 20 0.17 3
Admin. Partnership Agreement...
Form HUD-2994-A You are Our 50 1 50 0 0
Client (Optional Survey) (OMB
No: 2535-0116).................
Form HUD-52651--FSS Application. 800 1 800 1.5 1,200
Action Plan..................... 73 1 10 10 730
Form HUD-52650--Contract of 1,000 10 10,000 .25 2,500
Participation..................
Form HUD-52652--Escrow Account 600 90 54,000 .85 45,900
Credit Worksheet...............
Form HUD-1044--Grant Agreement * 700 1 250 N/A N/A
Annual Report (Narrative)/ 775 1 775 1 775
Performance Report.............
Form HUD-50058--Family Report 900 50 45,000 0 0
(OMB No. 2577-0083)............
-------------------------------------------------------------------------------
Total....................... .............. .............. .............. 26.69 51,908
----------------------------------------------------------------------------------------------------------------
*HUD-1044, Award/Amendment is completed by HUD staff, signed by the recipient of the grant, and returned to HUD.
This form is a certification and HUD ascribes no burden to its use.
[[Page 59242]]
In accordance with 5 CFR 1320.8(d)(1), HUD is soliciting comments
from members of the public and affected agencies concerning the
information collection requirements in the proposed rule regarding:
(1) Whether the proposed collection of information is necessary for
the proper performance of the functions of the agency, including
whether the information will have practical utility;
(2) The accuracy of the agency's estimate of the burden of the
proposed collection of information;
(3) Whether the proposed collection of information enhances the
quality, utility, and clarity of the information to be collected; and
(4) Whether the proposed information collection minimizes the
burden of the collection of information on those who are to respond;
including through the use of appropriate automated collection
techniques or other forms of information technology (e.g., permitting
electronic submission of responses).
Interested persons are invited to submit comments regarding the
information collection requirements in this rule. The proposed
information collection requirements in this rule have been submitted to
OMB for review under section 3507(d) of the Paperwork Reduction Act.
Under the provisions of 5 CFR part 1320, OMB is required to make a
decision concerning this collection of information between 30 and 60
days after the publication date. Therefore, a comment on the
information collection requirements is best assured of having its full
effect if OMB receives the comment within 30 days of the publication.
This time frame does not affect the deadline for comments to the agency
on the proposed rule. Comments must refer to the proposed rule by name
and docket number (FR-6085) and must be sent to:
HUD Desk Officer, Office of Management and Budget, New Executive Office
Building, Washington, DC 20503, Fax number: 202-395-6947
and
Colette Pollard, HUD Reports Liaison Officer, U.S. Department of
Housing and Urban Development, 451 7th Street SW, Room 2204,
Washington, DC 20410
Interested persons may submit comments regarding the information
collection requirements 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 them
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 the instructions provided on that site to submit comments
electronically.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4; approved March 22, 1995) (UMRA) establishes requirements for Federal
agencies to assess the effects of their regulatory actions on State,
local, and tribal governments, and on the private sector. This rule
does not impose any Federal mandates on any State, local, or tribal
government, or on the private sector, within the meaning of the UMRA.
Environmental Review
A Finding of No Significant Impact with respect to the environment
has been made in accordance with HUD regulations in 24 CFR part 50 that
implement section 102(2)(C) of the National Environmental Policy Act of
1969 (42 U.S.C. 4332(2)(C)). The Finding is available for public
inspection during regular business hours in the Regulations Division,
Office of General Counsel, U.S. Department of Housing and Urban
Development, 451 Seventh Street SW, Room 10276, Washington, DC 20410-
0500. Due to security measures at the HUD Headquarters building, please
schedule an appointment to review the Finding by calling the
Regulations Division at 202-402-3055 (this is not a toll-free number).
Individuals with speech or hearing impairments may access this number
via TTY by calling the Federal Information Relay Service at 800-877-
8339.
Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.)
generally requires an agency to conduct a regulatory flexibility
analysis of any rule subject to notice and comment rulemaking
requirements unless the agency certifies that the rule will not have a
significant economic impact on a substantial number of small entities.
As has been discussed in this preamble, this rule proposes to make
changes to HUD's regulations to implement the Section 306 statutory
changes and streamline other requirements. HUD believes this rule will
overall reduce burden, including for small PHAs and multifamily owners.
The burden reduction anticipated is more fully discussed in the
accompanying Regulatory Impact Assessment (RIA). For these reasons, HUD
has determined that this rule would not have a significant economic
impact on a substantial number of small entities. Notwithstanding HUD's
determination that this rule will not have a significant effect on a
substantial number of small entities, HUD specifically invites comments
regarding any less burdensome alternatives to this rule that will meet
HUD's objectives as described in this preamble.
Executive Order 13132, Federalism
Executive Order 13132 (entitled ``Federalism'') prohibits an agency
from publishing any rule that has federalism implications if the rule
either: (1) Imposes substantial direct compliance costs on State and
local governments and is not required by statute, or (2) preempts State
law, unless the agency meets the consultation and funding requirements
of section 6 of the Executive Order. This proposed rule does not have
federalism implications and does not impose substantial direct
compliance costs on State and local governments nor preempt State law
within the meaning of the Executive Order.
List of Subjects
24 CFR Part 887
Grant programs-housing and community development, Public housing,
Rent subsidies, Reporting and recordkeeping requirements.
24 CFR Part 984
Grant programs-housing and community development, Grant programs-
Indians, Indians, Public housing, Rent subsidies, Reporting and
recordkeeping requirements.
Accordingly, for the reasons stated in the preamble, HUD proposes
to amend 24 CFR chapters VIII and IX as follows:
0
1. Add part 887 to read as follows:
PART 887--SECTION 8 HOUSING ASSISTANCE PAYMENTS PROGRAMS--FAMILY
SELF-SUFFICIENCY PROGRAM
Sec.
887.101 Purpose, scope, and applicability.
887.103 Definitions.
887.105 Basic requirements of FSS.
887.107 Cooperative agreements.
887.109 Housing assistance and total tenant payments and increases
in family income.
887.111 FSS Award Funds Formula.
Authority: 42 U.S.C. 1437u, and 3535(d).
[[Page 59243]]
Sec. 887.101 Purpose, scope, and applicability.
(a) Purpose. (1) The purpose of the Family Self-Sufficiency (FSS)
Program is to promote the development of local strategies to coordinate
the use of HUD assistance with public and private resources, to enable
families eligible to receive HUD assistance to achieve economic
independence and self-sufficiency.
(2) The purpose of this part is to implement the policies and
procedures applicable to operation of an FSS program under HUD's
Section 8 Housing assistance payments programs, as established under
section 23 of the 1937 Act (42 U.S.C. 1437u).
(b) Scope. Each owner may implement an FSS program independently or
by way of a Cooperative Agreement with a Public Housing Agency (PHA) or
another owner. Each owner that administers an FSS program must do so in
accordance with the requirements of this part.
(c) Applicability. This part applies to owners of multifamily
rental housing properties assisted by Section 8 Housing assistance
payments programs. See part 984 of this title for program regulations
applicable to PHAs.
(d) Nonparticipation. Tenant participation in an FSS program is
voluntary. Assistance under Section 8 Housing assistance payments
programs for a family that elects not to participate in an FSS program
shall not be delayed or terminated by reason of such election.
Sec. 887.103 Definitions.
The definitions in 24 CFR 984.103 apply to this part, except that
eligible families means tenant families living in multifamily assisted
housing.
Sec. 887.105 Basic requirements of FSS.
(a) An FSS program that is voluntarily established under this part
by an owner must comply with the following requirements:
(1) Shall be operated in conformity with the regulations of this
part and other Section 8 regulations, codified in 24 CFR parts 5, 402,
880, 881, 883, and 884, respectively, and with FSS program objectives,
as described in Sec. 984.102;
(2) Shall coordinate supportive services as defined in Sec.
984.103;
(3) Shall have an Action Plan approved by HUD, as described in
Sec. 984.201, before operating an FSS program;
(4) Shall work with a Program Coordinating Committee (PCC), as
described in Sec. 984.202, when available;
(5) May make available and utilize onsite facilities, as described
in Sec. 984.204;
(6) Shall comply with the FSS funds provision, as described in
Sec. 984.302;
(7) Shall enter into Contracts of Participation with eligible
families, as described in Sec. 984.303;
(8) Shall establish and manage FSS accounts as described in Sec.
984.305;
(9) Shall report information to HUD as described in Sec. 984.401;
(10) Shall be operated in compliance with the nondiscrimination and
equal opportunity requirements set forth in 24 CFR part 5.
(b) An owner may employ appropriate staff, including a program
coordinator to administer its FSS program, and may contract with an
appropriate organization to establish and administer parts of the FSS
program.
Sec. 887.107 Cooperative agreements.
(a) An owner may enter into a Cooperative Agreement with:
(1) A local PHA that operates an FSS program, pursuant to Sec.
984.106; or
(2) Another owner that operates an FSS program, pursuant to this
section.
(b) Owners that enter into a Cooperative Agreement pursuant to this
subpart, must:
(1) Open any FSS waiting lists to all eligible families residing in
the properties covered by the Cooperative Agreement.
(2) Provide periodic escrow amounts to the program coordinator for
FSS families covered by the Cooperative Agreement under this subpart.
The Cooperative Agreement must provide that each owner is responsible
for managing the escrow accounts of their participating families,
including calculating and tracking of escrow in accordance with Sec.
984.305, and set forth the procedures for the sharing of escrow
information between the PHA and the owner.
(3) The Cooperative Agreement must clearly specify the terms and
conditions of such agreement, including the requirements of this
subsection.
Sec. 887.109 Housing assistance and total tenant payments and
increases in family income.
(a) Housing assistance payment. The housing assistance payment for
an eligible family participating in the FSS program under this part is
determined in accordance with the regulations set forth in Sec.
5.661(e).
(b) Total tenant payment. The total tenant payment for an FSS
family participating in the FSS program is determined in accordance
with Sec. 5.628 of this title.
(c) Increases in FSS family income. Any increase in the earned
income of an FSS family during its participation in an FSS program may
not be considered as income or a resource for purposes of eligibility
of the FSS family for other benefits, or amount of benefits payable to
the FSS family, under any other program administered by HUD.
Sec. 887.111 FSS Award Funds Formula.
The Secretary may establish a formula by which funds for
administration of the FSS program are awarded consistent with 42 U.S.C.
1437u(i). Notice of, and changes to, such formula will be published in
the Federal Register.
0
2. Revise part 984 to read as follows:
PART 984--SECTION 8 AND PUBLIC HOUSING FAMILY SELF-SUFFICIENCY
PROGRAM
Subpart A--General
Sec.
984.101 Purpose, applicability, and scope.
984.102 Program objectives.
984.103 Definitions.
984.104 Basic requirements of the FSS Program.
984.105 Minimum program size.
984.106 Cooperative agreements.
984.107 FSS Award Funds Formula.
Subpart B--Program Development and Approval Procedures
984.201 Action Plan.
984.202 Program Coordinating Committee (PCC).
984.203 FSS family selection procedures.
984.204 On-site facilities.
Subpart C--Program Operations
984.301 Program implementation.
984.302 FSS funds.
984.303 Contract of Participation (CoP).
984.304 Amount of rent paid by FSS family and increases in family
income.
984.305 FSS account.
984.306 HCV portability requirements.
Subpart D--Reporting
984.401 Reporting.
Authority: 42 U.S.C. 1437f, 1437u, and 3535(d).
Subpart A--General
Sec. 984.101 Purpose, applicability, and scope.
(a) Purpose. (1) The purpose of the Family Self-Sufficiency (FSS)
Program is to promote the development of local strategies to coordinate
the use of HUD assistance with public and private resources, to enable
families eligible to receive HUD assistance to achieve economic
independence and self-sufficiency.
(2) The purpose of this part is to implement the policies and
procedures applicable to operation of an FSS program, as established
under section 23 of the 1937 Act (42 U.S.C. 1437u), under HUD's public
housing assistance
[[Page 59244]]
and housing assistance under Section 8(o) programs.
(b) Applicability. This part applies to PHAs administering either
or both a public housing program under section 9 and a project-based
and/or tenant-based assistance program under section 8(o) of the U.S.
Housing Act of 1937. See 24 CFR part 887 for program regulations
applicable to owners of multifamily assisted housing.
(c) Scope. Each PHA that administers an FSS program must do so in
accordance with the requirements of this part. See Sec. 984.105 for
more information concerning PHAs that are required to administer an FSS
program.
(d) Nonparticipation. Participation in an FSS program is voluntary.
A family's admission to the public housing or Section 8 programs cannot
be conditioned on participation in FSS. A family's housing assistance
cannot be terminated by reason of such election.
Sec. 984.102 Program objectives.
The objective of the FSS program is to reduce the dependency of
low-income families on welfare assistance and housing subsidies. Under
the FSS program, HUD assisted families are provided opportunities for
education, job training, counseling, and other forms of social service
assistance, while living in assisted housing, so that they may obtain
the education, employment, and business and social skills necessary to
achieve self-sufficiency, as defined in Sec. 984.103. The Department
will evaluate the performance of a local FSS program using a scoring
system that measures criteria such as graduation from the program,
increased earned income and program participation, as provided by HUD
through a Federal Register notice.
Sec. 984.103 Definitions.
(a) The terms 1937 Act, Fair Market Rent, HUD, Low income family,
Public Housing, Public Housing Agency (PHA), Secretary, and Section 8,
as used in this part, are defined in Part 5 of this title.
(b) As used in this part:
Baseline annual earned income means, for purposes of determining
the FSS credit under Sec. 984.305(b), the FSS family's total annual
earned income from wages and business income (if any) as of the
effective date of the FSS contract. In calculating baseline annual
earned income, all applicable exclusions of income must be applied,
except for any disregard of earnings associated with self-sufficiency
incentives that may be applicable to the determination of annual
income.
Baseline monthly rent means, for purposes of determining the FSS
credit under Sec. 984.305(b):
(i) The FSS family's total tenant payment (TTP), as of the
effective date of the FSS contract, for families paying an income-based
rent as of the effective date of the FSS contract; or
(ii) The amount of the flat or ceiling rent (which includes the
applicable utility allowance), and including any hardship discounts, as
of the effective date of the FSS contract, for families paying a flat
or ceiling rent as of the effective date of the FSS contract.
Certification means a written assertion based on supporting
evidence, provided by the FSS family or the PHA or owner, as may be
required under this part, and which:
(i) Shall be maintained by the PHA or owner in the case of the
family's certification, or by HUD in the case of the PHA's or owner's
certification;
(ii) Shall be made available for inspection by HUD, the PHA or
owner, and the public, as appropriate; and,
(iii) Shall be deemed to be accurate for purposes of this part,
unless the Secretary or the PHA or owner, as applicable, determines
otherwise after inspecting the evidence and providing due notice and
opportunity for comment.
Chief Executive Officer (CEO). The CEO of a unit of general local
government means the elected official or the legally designated
official, who has the primary responsibility for the conduct of that
entity's governmental affairs.
Contract of Participation (CoP) means--a contract, in a form
approved by HUD, entered into between an FSS family and a PHA or owner
operating an FSS program that sets forth the terms and conditions
governing participation in the FSS program. The CoP includes all
Individual Training and Services Plans (ITSPs) entered into between the
PHA or owner and all members of the family who will participate in the
FSS program, and which plans are attached to the CoP as exhibits. For
additional detail, see Sec. 984.303.
Current annual earned income means, for purposes of determining the
FSS credit under Sec. 984.305(b), the FSS family's total annual earned
income from wages and business income (if any) as of the most recent
reexamination of income which occurs after the effective date of the
FSS contract. In calculating current annual earnings, all applicable
exclusions of income will apply, including any disregard of earnings
associated with self-sufficiency incentives or other alternative rent
structures that may be applicable to the determination of annual
income.
Current monthly rent means, for purposes of determining the FSS
credit under Sec. 984.305(b):
(i) The FSS family's TTP as of the most recent reexamination of
income, which occurs after the effective date of the FSS contract, for
families paying an income-based rent as of the most recent
reexamination of income; or
(ii) The amount of the flat rent, (which includes the applicable
utility allowance), or ceiling rent and including any hardship
discounts, as of the most recent reexamination of income which occurs
after the effective date of the FSS contract, for families paying a
flat rent or ceiling rent as of the most recent reexamination of
income.
Earned income means income or earnings included in annual income
from wages, tips, salaries, other employee compensation, and self-
employment. Earned income does not include any pension or annuity,
transfer payments, any cash or in-kind benefits, or funds deposited in
or accrued interest on the FSS escrow account established by a PHA or
owner on behalf of a FSS family.
Effective date of Contract of Participation (CoP)--the day in which
the FSS family and the PHA or owner execute the CoP.
Eligible families means current residents of Public Housing
(section 9) and current Section 8(o) program participants, as defined
in this section, including those participating in other local self-
sufficiency programs.
Enrollment means the date that the FSS family entered into the CoP
with the PHA or owner.
Family Self-Sufficiency (FSS) Program means the program established
by a PHA or owner within its jurisdiction to promote self-sufficiency
among participating families, including the coordination of supportive
services to these families, as authorized by section 23 of the 1937
Act.
FSS account means the FSS escrow account authorized by section 23
of the 1937 Act, and as provided by Sec. 984.305.
FSS credit means the amount credited by the PHA or owner to the FSS
family's FSS account.
FSS family means a family that resides in Public Housing (section
9) or receives Section 8(o) assistance, as defined in this section, and
that elects to participate in the FSS program, and whose designated
adult member, as determined in accordance with Sec. 984.303(a), has
signed the CoP.
FSS family in good standing means, for purposes of this part, an
FSS family that is not in current eviction proceedings and is otherwise
in
[[Page 59245]]
compliance with any repayment agreement and the FSS CoP.
FSS related service program means any program, publicly or
privately sponsored, that offers the kinds of supportive services
described in the definition of ``supportive services'' set forth in
this Sec. 984.103.
FSS slots refers to the total number of families (as determined in
the Action Plan and, for mandatory programs, in section 105 of this
part) that the PHA will serve in its FSS program.
FY means Federal Fiscal Year (starting October 1 and ending
September 30, and year designated by the calendar year in which it
ends).
Head of FSS family means the adult family member of the FSS family
who has signed the CoP. The head of the FSS family may, but is not
required to, be the head of the household for purposes of determining
income eligibility and rent.
Individual Training and Services Plan (ITSP) means:
(i) A written plan that is prepared by the PHA or owner in
consultation with the family member, and which sets forth:
(A) The final and interim goals for the participating FSS family
member;
(B) The supportive services to be provided to the participating FSS
family member;
(C) The activities to be completed by that family member; and,
(D) The agreed upon completion dates for the goals, services, and
activities.
(ii) Each ITSP must be signed by the PHA or owner and the
participating FSS family member, and is attached to, and incorporated
as part of the CoP. An ITSP must be prepared for each adult member who
elects to participate in the FSS program, including the adult family
member who has signed the CoP.
Multifamily assisted housing means rental housing assisted by a
Section 8 Housing Payments Program, pursuant to 24 CFR parts 880, 881,
883, 884, and 886.
Owner means the owner of multifamily assisted housing.
Program Coordinating Committee (PCC) is the committee described in
Sec. 984.202.
Section 8(o) means assistance provided under section 8(o) of the
1937 Act (42 U.S.C. 1437f). Specifically, housing assisted under the
Housing Choice Voucher (HCV) Program, including Project-Based Vouchers
(PBV).
Self-sufficiency means that an FSS family is no longer receiving
Section 8, Public Housing assistance, or any Federal, State, or local
rent, homeownership subsidies, or welfare assistance. Achievement of
self-sufficiency, although an FSS program objective, is not a condition
for receipt of the FSS account funds.
Supportive services means those appropriate services that a PHA or
owner will coordinate on behalf of an FSS family under a CoP, which may
include, but are not limited to:
(i) Child care--child care (on an as-needed or ongoing basis) of a
type that provides sufficient hours of operation and serves an
appropriate range of ages;
(ii) Transportation--transportation necessary to enable a
participating FSS family member to receive available services, or to
commute to their places of employment;
(iii) Education--remedial education; education for completion of
high school or attainment of a high school equivalency certificate;
education in pursuit of a post-secondary degree or certification;
(iv) Employment Supports--job training, preparation, and
counseling; job development and placement; and follow-up assistance
after job placement and completion of the CoP;
(v) Personal welfare--substance/alcohol abuse treatment and
counseling;
(vi) Household management--training in household management;
(vii) Homeownership and housing counseling--homeownership education
and assistance and housing counseling;
(viii) Financial Empowerment--training in financial literacy, such
as financial coaching, training in financial management, asset
building, and money management, including engaging in mainstream
banking, reviewing and improving credit scores, etc.;
(ix) Other services--any other services and resources, including
case management, reasonable accommodations for individuals with
disabilities, that are determined to be appropriate in assisting FSS
families to achieve economic independence and self-sufficiency.
Unit size or size of unit refers to the number of bedrooms in a
dwelling unit.
Very low-income family. See definitions in Sec. 813.102.
Welfare assistance means (for purposes of the FSS program only)
income assistance from Federal, (i.e., Temporary Assistance for Needy
Families (TANF) or subsequent program) State, or local welfare programs
and includes only cash maintenance payments designed to meet a family's
ongoing basic needs. Welfare assistance does not include:
(i) Nonrecurrent, short-term benefits that:
(A) Are designed to deal with a specific crisis or episode of need;
(B) Are not intended to meet recurrent or ongoing needs; and,
(C) Will not extend beyond four months.
(ii) Work subsidies (i.e., payments to employers or third parties
to help cover the costs of employee wages, benefits, supervision, and
training);
(iii) Supportive services such as child care and transportation
provided to families who are employed;
(iv) Refundable earned income tax credits;
(v) Contributions to, and distributions from, Individual
Development Accounts under Temporary Assistance for Needy Families
(TANF);
(vi) Services such as counseling, case management, peer support,
child care information and referral, financial empowerment,
transitional services, job retention, job advancement, and other
employment-related services that do not provide basic income support;
(vii) Amounts solely directed to meeting housing expenses;
(viii) Amounts for health care;
(ix) Supplemental Nutrition Assistance Program and emergency rental
and utilities assistance;
(x) Supplemental Security Income, Social Security Disability
Income, or Social Security; and
(xi) Child-only or non-needy TANF grants made to or on behalf of a
dependent child solely on the basis of the child's need and not on the
need of the child's current non-parental caretaker.
Sec. 984.104 Basic requirements of the FSS Program.
(a) An FSS Program established under this part shall be operated in
conformity with the requirements of this part, including the action
plan at Sec. 984.201; and:
(1) As applicable to Section 8(o) program participants:
(i) HCV regulations at 24 CFR part 982, for HCV program
participants; and
(ii) PBV regulations at 24 CFR part 983, for PBV program
participants.
(2) As applicable to Public Housing program participants, the
applicable Public Housing regulations, including the regulations in 24
CFR parts 5, subpart F, 960, and 966; and,
(3) The nondiscrimination and equal opportunity requirements set
forth in 24 CFR part 5.
(b) [Reserved]
Sec. 984.105 Minimum program size.
(a) FSS program size--(1) Minimum program size requirement. A PHA
must operate an FSS program of the minimum program size determined in
accordance with paragraph (b) of this section.
[[Page 59246]]
(2) Exception to program operation or to operate a smaller
mandatory program. Paragraph (c) of this section states when HUD may
grant an exception to the program operation requirement, and paragraph
(d) states when an exception may be granted to operate a program that
is smaller than the minimum program size.
(3) Option to operate larger FSS program. A PHA may choose to
operate an FSS program of a larger size than the minimum.
(b) How to determine FSS minimum program size--(1) In general. Each
PHA that was required to administer an FSS program, shall continue to
operate such program for, at a minimum, the total number of families
the PHA was required by statute to serve as of May 24, 2018, subject
only to the availability of sufficient amounts for housing assistance
under appropriations acts and the provisions of paragraph (b)(2) of
this section.
(2) Reduction of minimum program size. The minimum program size for
a PHA's FSS program is reduced by one slot for each family from any
rental assistance program (Public Housing or Section 8, including
multifamily assisted housing) for which the PHA administers FSS under
this section and that graduates from the FSS program by fulfilling its
FSS CoP on or after October 21, 1998. If an FSS slot is vacated by a
family that has not completed its FSS CoP obligations, the slot must be
filled by a replacement family which has been selected in accordance
with the FSS family selection procedures set forth in Sec. 984.203.
(c) Exception to program operation. (1) Upon approval by HUD, a PHA
will not be required to carry out an FSS program if the PHA provides to
HUD a certification, as defined in Sec. 984.103, that the operation of
such an FSS program is not feasible because of local circumstances,
which may include, but are not limited to, the following:
(i) Lack of supportive services accessible to eligible families,
including insufficient availability of resources for programs under
title I of the Workforce Innovation and Opportunity Act (29 U.S.C. 3111
et seq.);
(ii) Lack of funding for reasonable administrative costs;
(iii) Lack of cooperation by other units of State or local
government; or,
(iv) Lack of interest in participating in the FSS program on the
part of eligible families.
(2) An exception will not be granted if HUD determines that local
circumstances do not preclude the PHA from effectively operating an FSS
program that is smaller than the minimum program size.
(d) Exception to operate a smaller mandatory program. Upon approval
by HUD, a PHA may be permitted to operate an FSS program that is
smaller than the minimum program size if the PHA provides to HUD a
certification, as defined in Sec. 984.103, that the operation of an
FSS program of the minimum program size is not feasible because of
local circumstances, which may include, but are not limited to:
(1) Decrease in or lack of supportive services accessible to
eligible families, including insufficient availability of resources for
programs under title I of the Workforce Innovation and Opportunity Act
(29 U.S.C. 3111 et seq.);
(2) Decrease in or lack of funding for reasonable administrative
costs;
(3) Decrease in or lack of cooperation by other units of State or
local government;
(4) Decrease in or lack of interest in participating in the FSS
program on the part of eligible families.
(e) Expiration of exception. A full or partial exception to the FSS
minimum program size requirement (approved by HUD in accordance with
paragraph (c) or (d) of this section) expires five (5) years from the
date of HUD approval of the exception. If circumstances change and a
HUD-approved exception is no longer needed, the PHA is not required to
effectuate the exception for the full term of the exception. If a PHA
seeks to continue an exception after its expiration, the PHA must
submit a new request and certification to HUD for consideration.
(f) Review of Certification Records. HUD reserves the right to
examine, during its management review of the PHA, or at any time, the
documentation and data that a PHA relied on in certifying to the
unfeasibility of its establishing and operating an FSS program, or of
operating one of less than minimum program size.
Sec. 984.106 Cooperative agreements.
(a) A PHA may enter into a Cooperative Agreement with one or more
owners to voluntarily make an FSS program available to the owner's
multifamily assisted housing tenants.
(b) A PHA and owner that enter into a Cooperative Agreement to make
an FSS program available, are subject to this part and the following
requirements:
(1) The PHA must open its FSS waiting list to any eligible family
residing in the multifamily assisted housing covered by the Cooperative
Agreement.
(2) The owner must provide, at the request of the PHA, information
on escrow amounts for participating multifamily assisted housing
tenants. The Cooperative Agreement must provide that the owner is
responsible for managing the escrow account, including calculating and
tracking of escrow in accordance with Sec. 984.305, and set forth the
procedures that will be in place for the exchange of escrow information
between the PHA and the owner.
(3) The PHA may count multifamily assisted housing families served
by a Cooperative Agreement under this subpart as part of the
calculation of the FSS award under Sec. Sec. 984.107 and 984.302.
(4) The PHA may use FSS funds to serve multifamily assisted housing
tenants subject to a Cooperative Agreement under this section.
(5) The Cooperative Agreement must clearly specify the terms and
conditions of such agreement, including the requirements of this
subsection.
Sec. 984.107 FSS Award Funds Formula.
The Secretary may establish a formula by which funds for
administration of the FSS program are awarded consistent with 42 U.S.C.
1437u(i). Notice of, and changes to, such formula will be published in
the Federal Register.
Subpart B--Program Development and Approval Procedures
Sec. 984.201 Action Plan.
(a) Requirement for Action Plan. A PHA or owner must have a HUD-
approved Action Plan that complies with the requirements of this
section before the PHA or owner operates an FSS program, whether the
FSS program is a mandatory or voluntary program.
(b) Development of Action Plan. The Action Plan shall be developed
by the PHA in consultation with the chief executive officer of the
applicable unit of general local government and the Program
Coordinating Committee. Consultation for the Action Plan by the PHA or
owner shall also include representatives of current and prospective FSS
program participants, any local agencies responsible for programs under
title I of the Workforce Innovation and Opportunity Act (29 U.S.C. 3111
et seq.), other appropriate organizations (such as other local welfare
and employment or training institutions, child care providers,
financial empowerment providers, nonprofit service providers, and
private businesses), and any other public and private service providers
affected by the operation of the local program.
[[Page 59247]]
(c) Plan submission--(1) Voluntary program. The PHA or owner must
submit its Action Plan and obtain HUD approval of the plan before the
PHA or owner carries out a voluntary FSS program, including a program
that exceeds the minimum size for a mandatory program, regardless of
whether the voluntary program receives HUD funding.
(2) Revision. Following HUD's initial approval of the Action Plan,
no further approval of the Action Plan is required unless the PHA or
owner proposes to make policy changes to the Action Plan or increase
the size of a voluntary program; or HUD requires other changes. In such
cases, the PHA or owner must submit such changes to the Action Plan to
HUD for approval.
(d) Contents of Action Plan. The Action Plan shall describe the
policies and procedures for the operation of a local FSS program, and
shall contain, at a minimum, the following information:
(1) Family demographics. A description of the number, size,
characteristics, and other demographics (including racial and ethnic
data), and the supportive service needs of the families expected to
participate in the FSS program;
(2) Estimate of participating families. A description of the number
of eligible FSS families who can reasonably be expected to receive
supportive services under the FSS program, based on available and
anticipated Federal, tribal, State, local, and private resources;
(3) Eligible families from other self-sufficiency programs. If
applicable, the number of families, by program type, who are
participating in other local self-sufficiency programs and are expected
to agree to execute an FSS CoP.
(4) FSS family selection procedures. A statement indicating the
procedures to be utilized to select families for participation in the
FSS program, subject to the requirements governing the selection of FSS
families, set forth in Sec. 984.203. This statement must include a
description of how the selection procedures ensure that families will
be selected without regard to race, color, religion, sex, disability,
familial status, or national origin.
(5) Incentives to encourage participation. A description of the
incentives that will be offered to eligible families to encourage their
participation in the FSS program (incentives plan). The incentives plan
shall provide for the establishment of the FSS account in accordance
with the requirements set forth in Sec. 984.305, and other incentives,
if any. The incentives plan shall be part of the Action Plan.
(6) Outreach efforts. A description of:
(i) The efforts, including notification and outreach efforts, to
recruit FSS participants from among eligible families; and,
(ii) The actions to be taken to assure that both minority and non-
minority groups are informed about the FSS program, and how this
information will be made available.
(7) FSS activities and supportive services. A description of the
activities and supportive services to be coordinated on behalf of
participating FSS families and identification of the public and private
resources which are expected to provide the supportive services.
(8) Method for identification of family support needs. A
description of how the FSS program will identify the needs and
coordinate the services and activities according to the needs of the
FSS families;
(9) Program termination; withholding of services; and available
grievance procedures. A description of all policies concerning
termination of participation in the FSS program, or withholding of
coordination of supportive services, on the basis of a family's failure
to comply with the requirements of the CoP; and the grievance and
hearing procedures available for FSS families.
(10) Assurances of non-interference with rights of non-
participating families. An assurance that a family's election not to
participate in the FSS program will not affect the family's admission
to public housing or to the Section 8 program or the family's right to
occupancy in accordance with its lease.
(11) Timetable for program implementation. A timetable for
implementation of the FSS program, as provided in Sec. 984.301(a)(1),
including the schedule for filling FSS slots with eligible FSS
families, as provided in Sec. 984.301;
(12) Certification of coordination. A certification that
development of the services and activities under the FSS program has
been coordinated with programs under title I of the Workforce
Innovation and Opportunity Act (29 U.S.C. 3111 et seq.); and any other
relevant employment, child care, transportation, training, and
education programs, and financial empowerment in the applicable area,
and that implementation will continue to be coordinated, in order to
avoid duplication of services and activities; and,
(13) Optional additional information. Such other information that
would help HUD determine the soundness of the proposed FSS program.
(e) Eligibility of a combined program. A PHA or owner that wishes
to operate a joint FSS program with a PHA or owner may combine its
resources with one or more PHAs or owners to deliver supportive
services under a joint Action Plan that will provide for the
coordination of a combined FSS program that meets the requirements of
this part.
(f) Single action plan. A PHA or owner may submit one Action Plan
that covers all applicable rental assistance programs (Section 8
vouchers, PBRA and public housing) served by the FSS program.
Sec. 984.202 Program Coordinating Committee (PCC).
(a) General. Each participating PHA must establish a PCC whose
functions will be to assist the PHA in securing commitments of public
and private resources for the operation of the FSS program within the
PHA's jurisdiction, including assistance in developing the Action Plan
and in operating the program.
(b) Membership--(1) Required membership. The PCC must include
representatives of the PHA, including one or more FSS coordinators, and
one or more participants from each HUD-assisted program served by the
PHA's FSS program. The PHA may seek assistance from the following
groups in identifying potential PCC members:
(i) An area-wide or city-wide resident council, if one exists;
(ii) If the PHA operates in a specific public housing development,
the resident council or resident management corporation, if one exists,
of the public housing development where the public housing FSS program
is to be carried out;
(iii) Any other resident group, which the PHA believes is
interested in the FSS program and would contribute to the development
and coordination of the FSS program (such as the Resident Advisory
Board or tenant association, as applicable.).
(2) Recommended membership. Membership on the PCC may include
representatives of the unit of general local government served by the
PHA, local agencies (if any) responsible for carrying out programs
under title I of the Workforce Innovation and Opportunity Act (29
U.S.C. 3111 et seq.), and other organizations, such as other State,
local or tribal welfare and employment agencies, public and private
primary, secondary, and post-secondary education or training
institutions, child care providers, financial empowerment
organizations, nonprofit service providers, private businesses, and any
other public and
[[Page 59248]]
private service providers with resources to assist the FSS program.
(c) Alternative committee. The PHA may, in consultation with the
chief executive officer of the unit of general local government served
by the PHA and one or more residents of each HUD-assisted program
served by the FSS program, utilize an existing entity as the PCC if the
membership of the existing entity consists, or will consist of, the
individuals identified in paragraph (b)(1) of this section, and also
includes individuals from the same or similar organizations identified
in paragraph (b)(2) of this section.
Sec. 984.203 FSS family selection procedures.
(a) Preference in the FSS selection process. A PHA has the option
of giving a selection preference for up to fifty (50) percent of its
FSS slots to eligible families, as defined in Sec. 984.103, who have
one or more family members currently enrolled in an FSS related service
program or on the waiting list for such a program. The PHA may limit
the selection preference given to participants in, and applicants for,
FSS related service programs to one or more eligible FSS related
service programs. A PHA that chooses to exercise the selection
preference option must include the following information in its Action
Plan:
(1) The percentage of FSS slots, not to exceed fifty (50) percent
of the total number of FSS slots, for which it will give a selection
preference;
(2) The FSS related service programs to which it will give a
selection preference to the programs' participants and applicants; and
(3) The method of outreach to, and selection of, families with one
or more members participating in the identified programs.
(b) Selection among families with preference. The PHA may use
either of the following to select among applicants on the FSS waiting
list with the same preference status:
(1) Date and time of application to the FSS program; or,
(2) A drawing or other random choice technique.
(c) FSS selection without preference. For those FSS slots for which
a selection preference is not applicable, the FSS slots must be filled
with eligible families in accordance with an objective selection
system, such as a lottery, the length of time living in subsidized
housing, or the date the family expressed an interest in participating
in the FSS program. The objective system to be used by the PHA must be
described in the PHA's Action Plan.
(d) Motivation as a selection factor--(1) General. A PHA may screen
families for interest, and motivation to participate in the FSS
program, provided that the factors utilized by the PHA are those which
solely measure the family's interest, and motivation to participate in
the FSS program.
(2) Permissible motivational screening factors. Permitted
motivational factors include requiring attendance at FSS orientation
sessions or preselection interviews and assigning certain tasks which
indicate the family's willingness to undertake the obligations which
may be imposed by the FSS CoP. Any tasks assigned shall be those which
may be readily accomplishable by the family, based on the family
members' educational level, and disabilities, if any. Reasonable
accommodations must be made for individuals with disabilities,
including, e.g., mobility, manual, sensory, speech, mental,
intellectual, or developmental disabilities;
(3) Prohibited motivational screening factors. Prohibited
motivational screening factors include the family's educational level,
educational or standardized motivational test results, previous job
history or job performance, credit rating, marital status, number of
children, or other factors, such as sensory or manual skills, and any
factors which may result in discriminatory practices or treatment
toward individuals with disabilities or minority or non-minority
groups.
Sec. 984.204 On-site facilities.
Each PHA or owner may, subject to the approval of HUD, make
available and utilize common areas or unoccupied dwelling units in
properties owned by the entity to provide or coordinate supportive
services under any FSS program.
Subpart C--Program Operations
Sec. 984.301 Program implementation.
(a) Voluntary program implementation. Unless otherwise required
under a funding notice, there is no deadline for implementation of a
voluntary program. A voluntary program, however, may not be implemented
before the requirements of Sec. 984.201 have been satisfied.
(b) Program administration. A PHA may employ appropriate staff,
including a service coordinator or program coordinator to administer
its FSS program, and may contract with an appropriate organization to
establish and administer all or part of the FSS program, including the
FSS account, as provided by Sec. 984.305.
Sec. 984.302 FSS funds.
(a) Public housing program. Subject to appropriations by Congress,
PHAs may use funds provided under section 9 of the 1937 Act to cover
reasonable and eligible administrative costs incurred by PHAs in
carrying out the FSS program.
(b) Section 8(o) program. Subject to appropriations by Congress,
PHAs may use the administrative fees paid to PHAs for costs associated
with operation of an FSS program.
(c) FSS funds. FSS funds associated with operation of an FSS
program are established by the Congress and subject to appropriations.
FSS funds may be used by PHAs or owners for costs associated with
families who are enrolled in an FSS program under this part, including
through a Cooperative Agreement in accordance with Sec. 984.106.
Sec. 984.303 Contract of Participation (CoP).
(a) General. Each eligible family that is selected to participate
in an FSS program must enter into a CoP with the PHA or owner that
operates the FSS program in which the family will participate. The CoP
shall be signed by a representative of the PHA or the owner and the
head of the FSS family, as designated by the family in consultation
with the PHA or the owner. This head of FSS family does not have to be
the same as the official Head of Household for rental assistance
purposes.
(b) Form and content of contract--(1) General. The CoP, which
incorporates the ITSP(s), shall set forth the principal terms and
conditions governing participation in the FSS program. These include
the rights and responsibilities of the FSS family and of the PHA or
owner, the services to be provided to, and the activities to be
completed by, each adult member of the FSS family who elects to
participate in the program.
(2) FSS Family goals. The ITSP incorporated in the CoP, shall
establish specific interim and final goals by which the PHA or owner,
and the family, may measure the FSS family's progress towards
fulfilling its obligations under the CoP, and becoming self-sufficient.
For any FSS family that is a recipient of welfare assistance, the PHA
or owner must establish as an interim goal for each FSS participant
that every member of the family become independent from welfare
assistance before the expiration of the term of the CoP, including any
extension thereof. Also, see the employment obligation described in
Sec. 984.303(b)(4) below. Aside from the goals specifically required
in this section, PHAs or owners must work
[[Page 59249]]
with each participant to establish realistic and individualized goals
and may not include additional mandatory goals that are applicable to
every FSS program participant.
(3) Compliance with lease terms. The CoP shall provide that one of
the obligations of the FSS family is to comply with the terms and
conditions of the respective public housing or Section 8 lease. All
considerations allowed for other assisted residents for repayment
agreements, etc., shall not be limited for FSS participants due to
their participation in FSS.
(4) Employment obligation. (i) Although all members of the FSS
family may seek and maintain suitable employment during the term of the
contract, only one adult family member with an ITSP shall be required
under the CoP to seek and maintain suitable employment during the term
of the contract and any extension thereof.
(ii) Seek employment. The obligation to seek employment means
searching for jobs, applying for employment, attending job interviews,
and otherwise following through on employment opportunities.
(iii) Determination of suitable employment. A determination of
suitable employment shall be made by the PHA or owner based on the
skills, education, and job training of the household member, and based
on the available job opportunities within the jurisdiction served by
the PHA or owner.
(5) Consequences of noncompliance with the contract. The CoP shall
specify that if the FSS family fails to comply, without good cause,
with the terms and conditions of the CoP, including compliance with the
public housing lease or the Section 8 lease, the PHA or owner may:
(i) Withhold the coordination of supportive services; or,
(ii) Terminate the family's participation in the FSS program.
(c) Contract term. The CoP shall provide that each FSS family will
be required to fulfill those obligations to which the FSS family has
committed itself under the CoP no later than 5 years after the first
recertification of income after the execution date of the CoP.
(d) Contract extension. The PHA or owner shall, in writing, extend
the term of the CoP for a period not to exceed two (2) years for any
FSS family that requests, in writing, an extension of the contract,
provided that the PHA or owner finds that good cause exists for
granting the extension. The family's written request for an extension
must include a description of the need for the extension. As used in
this paragraph (d) of this section, ``good cause'' means circumstances
beyond the control of the FSS family, as determined by the PHA or
owner, such as a serious illness or involuntary loss of employment, or
active pursuit of a current or additional goal that will result in
furtherance of self-sufficiency during the period of the extension
(e.g., completion of a college degree during which the participant is
unemployed or under-employed, credit repair towards being homeownership
ready, etc.). Extension of the CoP will entitle the FSS family to
continue to have amounts credited to the family's FSS account in
accordance with Sec. 984.304.
(e) Unavailability of supportive services--(1) Good-faith effort to
replace unavailable services. If a social service agency fails to
deliver the supportive services pledged under an FSS family member's
ITSP, the PHA or owner shall make a good faith effort to obtain these
services from another agency.
(2) Assessment of necessity of services. If the PHA or owner is
unable to obtain the services from another agency, the PHA or owner
shall reassess the family member's needs and determine whether other
available services would achieve the same purpose. If other available
services would not achieve the same purpose, the PHA or owner shall
determine whether the unavailable services are integral to the FSS
family's advancement or progress toward self-sufficiency. If the
unavailable services are:
(i) Determined not to be integral to the FSS family's advancement
toward self-sufficiency, the PHA or owner shall revise the ITSP to
delete these services, and modify the CoP to remove any obligation on
the part of the FSS family to accept the unavailable services, in
accordance with paragraph (f) of this section; or,
(ii) Determined to be integral to the FSS family's advancement
toward self-sufficiency, the PHA or owner shall declare the CoP null
and void and follow the requirements in paragraph (k) of this section.
(f) Modification. The PHA or owner and the FSS family may mutually
agree to modify the CoP with respect to the ITSP and/or the contract
term in accordance with paragraph (d) of this section, and/or
designation of the head of the FSS family. Modifications must be in
writing.
(g) Completion of the contract. The CoP is considered to be
completed, and a family's participation in the FSS program is
considered to be concluded when the FSS family has fulfilled all of its
obligations under the CoP, on or before the expiration of the contract
term, including any extension thereof.
(h) Termination of the contract. The CoP is automatically
terminated if the family's housing assistance is terminated in
accordance with HUD requirements. The CoP may be terminated before the
expiration of the contract term, and any extension thereof, by:
(1) Mutual consent of the parties;
(2) The failure of the FSS family to meet its obligations under the
CoP without good cause, including, for Section 8(o) participants,
failure to comply with the contract requirements because the family has
moved outside the jurisdiction of the PHA or out of multifamily
assisted housing;
(3) The family's withdrawal from the FSS program;
(4) Such other act as is deemed inconsistent with the purpose of
the FSS program; or
(5) Operation of law.
(i) Option to terminate FSS participation and supportive service
assistance. The PHA or owner may terminate or withhold the coordination
of supportive services, and the FSS family's participation in the FSS
program, if the PHA or owner determines, in accordance with the FSS
Action Plan hearing procedures, that the FSS family has failed to
comply without good cause with the requirements of the CoP as provided
in paragraph (b)(5) of this section.
(j) Transitional supportive service assistance. A PHA or owner may
continue to offer to a former FSS family that has completed its CoP,
appropriate coordination of those FSS supportive services needed to
become self-sufficient (if the family still resides in public housing
or Section 8 housing), or in remaining self-sufficient (if the family
no longer resides in public, Section 8, or other assisted housing).
(k) Nullification. (1) The CoP is considered null and void when:
(i) Services that the PHA or owner has determined are integral to
the FSS family's advancement towards self-sufficiency are unavailable,
as described in paragraph (e) of this section.
(ii) The head of the FSS family becomes permanently disabled and
unable to work or dies during the period of the contract, unless the
PHA or owner and the FSS family determine that it is possible to modify
the contract to designate a new head of the FSS family.
(2) Upon nullification of a CoP, escrow funds must be handled
consistent with Sec. 984.305(b)(3) and (c)(3).
[[Page 59250]]
Sec. 984.304 Amount of rent paid by FSS family and increases in
family income.
(a) The amount of rent paid by an FSS family is determined in
accordance with the requirements of the applicable housing assistance
program as specified in paragraphs (a)(1) and (2) of this section.
(1) Public housing program: Calculation of total tenant payment.
Total tenant payment for an FSS family participating in the FSS program
is determined in accordance with the regulations set forth in 24 CFR
part 5, subpart F.
(2) Section 8(o) programs: Calculation of total tenant payment. (i)
For the HCV program, rent is determined in accordance with 24 CFR part
982, subpart K; and
(ii) For the PBV program, rent is determined in accordance with 24
CFR part 983, subpart G.
(b) Increases in FSS family income. Any increase in the earned
income of an FSS family during its participation in an FSS program may
not be considered as income or a resource for purposes of eligibility
of the FSS family for other benefits, or amount of benefits payable to
the FSS family, under any other program administered by HUD.
Sec. 984.305 FSS account.
(a) Establishment of FSS account--(1) General. The PHA or owner
shall deposit the FSS account funds of all families participating in an
FSS program into a single interest-bearing depository account. The PHA
or owner must deposit the FSS account funds in one or more of the HUD-
approved investments. This account may be part of the PHA's or owner's
overall accounts, as long as it is in compliance with paragraph (a)(2)
of this section. During the term of the CoP, the escrow credit amount
shall be determined in accordance with paragraph (b) of this section at
each reexamination of income, which occurs after the effective date of
the CoP. Such escrow credit amount must be deposited each month by the
PHA or owner to each family's FSS account.
(2) Accounting for FSS account funds--(i) Accounting records. The
total of the combined FSS account funds will be supported in the
accounting records by a subsidiary ledger showing the balance
applicable to each FSS family.
(ii) Proration of investment income. The investment income for
funds in the FSS account will be prorated and credited to each family's
FSS account based on the balance in each family's FSS account at the
end of the period for which the investment income is credited.
(iii) Reduction of amounts due by FSS family. If the FSS family has
not paid the family contribution towards rent, or other amounts, if
any, due under the public housing or Section 8-assisted lease, the
balance in the family's FSS account shall be reduced by that amount (as
determined by the owner or reported by the owner to the PHA in the
Section 8(o) programs) at the time of final disbursement of FSS escrow
funds in accordance with paragraph (c) of this section. If the FSS
family has been found to have fraudulently under-reported income after
the escrow calculation baseline was set, the amount credited to the FSS
account will be based on the income amounts originally reported by the
FSS family. If the FSS family is found to have fraudulently under-
reported income in the certification used to set the baseline, the
escrow for the entire period of the CoP will be re-calculated using the
correct income to set the baseline and then subsequent escrow amounts.
(3) Reporting on FSS account. Each PHA or owner will be required to
make a report, at least once annually, to each FSS family on the status
of the family's FSS account. At a minimum, the report will include:
(i) The balance at the beginning of the reporting period;
(ii) The amount of the family's rent payment that was credited to
the FSS account, during the reporting period;
(iii) Any deductions made from the account at the time of final
disbursement of FSS escrow funds (see paragraphs (a)(2)(iii) and (c) of
this section) for amounts due the PHA or owner;
(iv) The amount of interest earned on the account during the year;
and
(v) The total in the account at the end of the reporting period.
(b) FSS credit--(1) Determining the family's baseline information.
When determining the family's baseline annual earned income and the
baseline monthly rent amounts for purposes of computing the FSS credit,
the PHA or owner must set a policy to either conduct a new re-
examination of income before the effective date of the FSS contract, or
to use the amounts on the family's last income reexamination.
(2) Computation of amount. The FSS credit amount shall be the lower
of:
(i) Thirty (30) percent of one-twelfth (1/12) (i.e., two and a half
(2.5) percent) of the amount by which the family's current annual
earned income exceeds the family's baseline annual earned income; or
(ii) The increase in the family's monthly rent. The increase in the
family's monthly rent shall be the lower of:
(A) The amount by which the family's current monthly rent exceeds
the family's baseline monthly rent;
(B) For HCV families, the difference between the baseline monthly
rent and the current gross rent (i.e., rent to owner plus any utility
allowance) or the payment standard, whichever is lower; or
(C) For PBV families, the difference between the baseline monthly
rent and the current gross rent (i.e., rent to owner plus any utility
allowance).
(3) Ineligibility for FSS credit. FSS families who are not low-
income families (i.e., whose adjusted annual income exceeds eighty (80)
percent of the area median income) shall not be entitled to any FSS
credit.
(4) Cessation of FSS credit. The PHA or owner shall not make
additional credits to the FSS family's FSS account:
(i) When the FSS family has completed the CoP, as defined in Sec.
984.303(g);
(ii) When the CoP is terminated or otherwise nullified; or
(iii) During the time a HCV family is in the process of moving to a
new unit, in accordance with HCV program requirements, and is not under
a lease.
(c) Disbursement of FSS account funds--(1) General. The amount in
an FSS account, in excess of any amount owed to the PHA or owner by the
FSS family, as provided in paragraph (a)(2)(iii) of this section, shall
be paid to the head of the FSS family when the CoP has been completed
as provided in Sec. 984.303(g), and if, at the time of contract
completion, the head of the FSS family submits to the PHA or owner a
certification, as defined in Sec. 984.103, that to the best of his or
her knowledge and belief, no member of the FSS family is a recipient of
welfare assistance.
(2) Disbursement before expiration of contract term. (i) If the PHA
or owner determines that the FSS family has fulfilled its obligations
under the CoP before the expiration of the contract term, and the head
of the FSS family submits a certification that, to the best of his or
her knowledge, no member of the FSS family is a recipient of welfare
assistance, the amount in the family's FSS account, in excess of any
amount owed to the PHA or owner by the FSS family, as provided in
paragraph (a)(2)(iii) of this section, shall be paid to the head of the
FSS family.
(ii) If the PHA or owner determines that the FSS family has
fulfilled certain interim goals established in the CoP and needs a
portion of the FSS account funds for purposes consistent with the CoP,
such as completion of higher
[[Page 59251]]
education (i.e., college, graduate school), job training, or to meet
start-up expenses involved in creation of a small business, the PHA or
owner may, at the PHA's or owner's sole discretion, disburse a portion
of the funds from the family's FSS account to assist the family in
paying those expenses. Unless the interim disbursement was made based
on fraudulent information from the family, the family is not required
to repay such interim amounts if the family does not complete the CoP.
(3) Disbursement under nullified contracts. If the CoP is nullified
in accordance with Sec. 984.303(k), the PHA or owner must disburse to
the family, in excess of any amount owed to the PHA or owner by the FSS
family, as provided in paragraph (a)(2)(iii) of this section, the
amount of escrow funds accumulated by the family before the effective
date of the nullification of the contract.
(4) Verification of family certification. Before disbursement of
the FSS account funds to the family, the PHA or owner may verify that
the FSS family is no longer a recipient of welfare assistance by
requesting copies of any documents which may indicate whether the
family is receiving any welfare assistance and contacting welfare
agencies.
(d) Succession of FSS account. If the head of the FSS family ceases
to reside with other family members in the public housing or the
Section 8-assisted unit, the remaining members of the FSS family, after
consultation with the PHA or owner, shall have the right to designate
another family member to receive the funds in accordance with paragraph
(c) of this section.
(e) Use of FSS account funds for homeownership. An FSS family may
use its FSS account funds for the purchase of a home, including the
purchase of a home under one of HUD's homeownership programs, or other
Federal, State, or local homeownership programs, unless such use is
prohibited by the statute or regulations governing the particular
homeownership program.
(f) Forfeiture of FSS account funds--(1) Conditions for forfeiture.
Amounts in the FSS account shall be forfeited upon the occurrence of
the following:
(i) The CoP is terminated, as provided in Sec. 984.303(h); or,
(ii) The CoP is completed by the family, as provided in Sec.
984.303(g), but the FSS family is receiving welfare assistance at the
time the CoP expires, including any extension thereof.
(2) Treatment of forfeited FSS account funds. FSS account funds
forfeited by the FSS family must be used by the PHA or owner for the
benefit of the FSS program and its participants.
(i) Specifically, such funds may be used on the following eligible
activities:
(A) Support for FSS participants in good standing, including, but
not limited to, transportation, child care, training, testing fees, and
employment preparation costs.
(B) Training for Program Coordinator(s),
(C) Other eligible activities as determined by the Secretary.
(ii) Such funds may not be used for salary and fringe benefits of
FSS program coordinators; for HAP expenses or public housing operating
funds; or any other activity determined ineligible by the Secretary.
Sec. 984.306 HCV portability requirements.
(a) Initial occupancy--(1) First 12 months. An HCV family
participating in the FSS program must lease an HCV-assisted unit, for a
minimum period of 12 months after the effective date of the CoP, in the
jurisdiction of the PHA that selected the family for the FSS program.
However, the initial PHA may approve a family's request to move outside
of its jurisdiction under portability (in accordance with Sec. 982.353
of this chapter) during this period.
(2) After the first 12 months. After the first 12 months of the FSS
CoP, the FSS family may move outside the initial PHA jurisdiction under
portability procedures (in accordance with Sec. 982.353 of this
chapter).
(b) An FSS family moves to the jurisdiction of a receiving PHA that
administers an FSS program. Whether the receiving PHA bills the initial
PHA or absorbs the FSS family into its HCV program, the receiving PHA
must enroll an FSS family in good standing in its FSS program, unless
the receiving PHA and the initial PHA agree to the FSS family's
continued participation in the initial PHA's FSS program if the initial
PHA determines that the relocating FSS family has demonstrated that,
notwithstanding the move, it will be able to fulfill its
responsibilities under the initial or modified CoP at its new place of
residence. For example, the FSS family may be able to commute to the
supportive services specified in the CoP, or the family may move to
obtain employment as specified in the contract.
(c) An FSS family moves to the jurisdiction of a receiving PHA that
does not administer an FSS program. If the receiving PHA does not
administer an FSS program, the FSS family may not continue
participation in the FSS program. The initial PHA must clearly discuss
the options that may be available to the family, depending on the
family's specific circumstances, which may include, but are not limited
to, modification of the FSS contract, termination of the FSS contract
and forfeiture of escrow, or locating a receiving PHA that administers
an FSS program.
(d) Single FSS account. Regardless of whether the FSS family
remains in the FSS program of the initial PHA or is enrolled in the FSS
program of the receiving PHA, there will be a single FSS account which
will be maintained by the initial PHA if the receiving PHA is billing
the initial PHA. If an FSS family will be absorbed by the receiving
PHA, the initial PHA will transfer the family's FSS account to the
receiving PHA and the receiving PHA will maintain the FSS account.
(e) FSS program termination; loss of FSS account. (1) If an FSS
family relocates to another jurisdiction, as provided under this
section, and is unable to fulfill its obligations under the CoP (or any
modifications thereto), the PHA, which is a party to the CoP, must
terminate the FSS family from the FSS program, and the family's FSS
account will be forfeited. Termination of FSS program participation
must be used only as a last resort, after the PHA determines, in
consultation with the family, that the family would be unable to
fulfill its obligations under the CoP after the move and that the
current CoP cannot be modified to allow for graduation prior to
porting. When termination is the only option, the PHA must clearly
notify the family that the move will result in the loss of escrow
funds.
(2) In the event of forfeiture of the family's FSS account, the
funds in the family's FSS account will revert to the PHA maintaining
the FSS account for the family.
(f) Contract of Participation (CoP). (1) If the FSS family enrolls
in the receiving PHA's FSS program pursuant to this section, the
receiving PHA will enter into a new CoP with the FSS family for the
term remaining on the contract with the initial PHA. The initial PHA
will terminate its CoP with the family;
(2) If the FSS family remains in the FSS program of the initial
PHA, pursuant to this section, the original CoP, executed by the
initial PHA, will remain as the contract in place.
(g) Enrollment of a non-participant in the receiving PHA's FSS
program--(1) Billing. If the receiving PHA bills the initial PHA, a
family that was not an FSS participant at the initial PHA may not
enroll in the receiving PHA's FSS program.
(2) Absorption. If the receiving PHA absorbs the family into its
HCV program, the receiving PHA may, consistent with the receiving PHA's
FSS
[[Page 59252]]
enrollment policies, enroll a family that was not an FSS participant at
the initial PHA into its FSS program.
Subpart D--Reporting
Sec. 984.401 Reporting.
Each PHA or owner that carries out an FSS program shall submit to
HUD, in the form prescribed by HUD, a report regarding its FSS program.
The report shall include the following information:
(a) A description of the activities carried out under the program;
(b) A description of the effectiveness of the program in assisting
families to achieve economic independence and self-sufficiency,
including the number of families enrolled and graduated and the number
of established escrow accounts and positive escrow balances;
(c) A description of the effectiveness of the program in
coordinating resources of communities to assist families to achieve
economic independence and self-sufficiency; and
(d) Any recommendations by the PHA or owner or the appropriate
local Program Coordinating Committee for legislative or administrative
action that would improve the FSS program and ensure the effectiveness
of the program.
R. Hunter Kurtz,
Assistant Secretary for Public and Indian Housing.
Dana T. Wade,
Assistant Secretary for Housing--Federal Housing Commissioner.
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[FR Doc. 2020-18896 Filed 9-18-20; 8:45 am]
BILLING CODE 4210-67-C
