Department of Housing and Urban Development August 15, 2014 – Federal Register Recent Federal Regulation Documents

Section 8(c)(1) of the United States Housing Act of 1937 (USHA) requires the Secretary to publish FMRs periodically, but not less than annually, adjusted to be effective on October 1 of each year. The primary uses of FMRs are to determine payment standards for the Housing Choice Voucher (HCV) program, to determine initial renewal rents for some expiring project-based Section 8 contracts, to determine initial rents for housing assistance payment contracts in the Moderate Rehabilitation Single Room Occupancy program, and to serve as rent ceilings in the HOME program. FMRs are also used in the calculation of maximum award amounts for Continuum of Care grantees. Today's notice provides proposed FY 2015 FMRs for all areas that reflect the estimated 40th and 50th percentile rent levels trended to April 1, 2015. The FY 2015 FMRs are based on ``5-year'' data collected by the American Community Survey (ACS) from 2008 through 2012. These data are updated by one-year 2012 ACS data for areas where statistically valid one-year ACS data is available. The Consumer Price Index (CPI) rent and utility indexes are used to further update the data from 2012 to the end of 2013. Finally, ACS data on changes national median gross rents from 2007 to 2012 are used to inflate the 2013 estimates to the 2015 levels. HUD continues to use ACS data in different ways according to the statistical reliability of rent estimates for areas of different population sizes and counts of rental units. The proposed FY 2015 FMRs in this notice do not reflect any updates to the methodology used to calculate FMRs. The proposed FY 2015 FMR areas are based on Office of Management and Budget (OMB) metropolitan area definitions as updated through December 1, 2009, and include HUD modifications that were first used in the determination of FY 2006 FMR areas. The February 28, 2013 OMB Area definition update has not been incorporated in this set of proposed FMRs due to the timing of the release and the availability of ACS data. HUD will work toward evaluating the impact of these new area definitions and discuss these findings in the final FY 2015 FMR publication, or, if that is not possible, in a subsequent publication in January 2015. The January 2015 notice will also discuss and solicit comments on several topics related to the calculation of FMRs, including the implementation of the February 28, 2013 OMB Metropolitan Area Definitions and possible measures the Department is considering that would reduce the concentration of Section 8 voucher tenants. For example, HUD is evaluating alternatives to the current 50th percentile FMR program, which was implemented to mitigate excessive geographic concentration of voucher tenants. Comments will be requested to determine interest in a program that is based on different measures for determining how many and which areas would receive special FMRs to encourage deconcentration, as well as on alternative FMR-based tools for promoting deconcentration such as Small Area FMRs estimated at the ZIP code level.