1. Slide #1 Annie Stevenson Verification Techniques

2. Slide #2 Welcome to Lunch N Learn!  Upcoming topics for the occupancy series: 8/1/08: Factors of Eligibility (PH and HCV) 8/15/08: EIV 9/4/08: PH Denials and Terminations 9/5/08: HCV Reasonable Accommodation

3. Slide #3 Welcome to Lunch N Learn!  Today’s topics: Total tenant payment calculation Minimum rent Utility allowances Flat rents

4. Slide #4

5. Slide #5 Total Tenant Payment  TTP is highest of: 10% total monthly income 30% monthly adjusted Income the welfare rent minimum rent

6. Slide #6 How to Get TTP  Annual Income$2000  4 children x $480 1920  Adjusted Income $ 80  Annual divided by 12 = $167 (mo. Inc)  Adjusted divided by 12 = $7 (mo adj inc)

7. Slide #7 How to Get TTP  10% of $167 = $17  30% of $7 = $2  Minimum Rent $25  Welfare Rent $0 (N/A)  TTP is ??????

8. Slide #8 TTP Calculation  Learning activity 1  TTP calculation on 50058 8a = $15,780 8y = $11,392 Minimum rent = $35

9. Slide #9 Learning Activity 1 Answers 1,315 132 285 N 949 30 35 0

10. Slide #10

11. Slide #11 Minimum Rents  PHAs may establish minimum rents $0 - $50  PHAs must adopt minimum rent hardship exemption policies

12. Slide #12 Minimum Rent Hardship Exemptions  Lost eligibility/awaiting determination for Federal, State or local assistance program  Would be evicted as result of requirement

13. Slide #13 Minimum Rent Hardship Exemptions  Family income decrease because of changed circumstances (unemployed)  Death in family  Other circumstances as determined by PHA or HUD

14. Slide #14 Minimum Rent Process  PHA notifies family if TTP = Minimum Rent  Family requests exemption  PHA suspends payment beginning of next month (use next higher TTP) Family not required to pay Minimum Rent during period PHA may request reasonable documentation of hardship

15. Slide #15 Minimum Rent Process  PHA must promptly determine if hardship exists whether temporary (PHA policy) or long term

16. Slide #16 Minimum Rent Process  PHA may not evict the family for nonpayment of minimum rent for a 90-day period Beginning the month following family’s request for a hardship exemption

17. Slide #17 Minimum Rent Process  If PHA determines no hardship under statute, minimum rent is imposed retroactively

18. Slide #18 Minimum Rent Process  If PHA determines the hardship is temporary Must reinstate minimum rent retroactively to beginning of suspension Reasonable repayment agreement offered

19. Slide #19 Minimum Rent Process  If PHA determines hardship of long-term duration exists, minimum rent is exempted retroactively to date of family’s request for exemption  Exemption continues until hardship no longer exists

20. Slide #20 PHA Procedures  PHA must have minimum rent hardship exemption policy  PHA must notify families Of right to request hardship exemption Hardship exemptions are subject to PHA’s informal hearing procedures

21. Slide #21 TTP Calculation: Minimum Rent Hardship Exemption  Learning activity 2  TTP calculation on 50058 8a = $900 8y = $55 Minimum rent = $50 Family requested and was granted exemption

22. Slide #22 Learning Activity 2 Answers 75 8 2 8 Y 5 30 0 0

23. Slide #23 Exemption Doesn’t Apply to Other Factors of TTP  Financial hardship exemption only applies to the payment of minimum rent and not to other elements used to calculate TTP  Example: 30% of AMI$45 10% of MI$27 PHA’s Min Rent$50 

24. Slide #24

25. Slide #25 Utility Allowance  PHAs are required to establish and maintain utility allowance schedules (see CFR 965.502)  A utility allowance is that amount approved by the PHA for reasonable monthly costs of local utility consumption

26. Slide #26 Utility Allowance  Families responsible for utility costs (excluding telephone) will see a utility allowance applied to their rent calculation

27. Slide #27

28. Slide #28 Definitions for Income-Based Rent  Tenant Rent – amount payable by the family as rent to the PHA  Utility Reimbursement – amount by which utility allowance exceeds TTP  Income Based Rent – rent based upon family income, allowances and deductions

29. Slide #29 Calculation of Tenant Rent and URP  To get Tenant Rent, subtract the utility allowance (UA) from TTP  If UA is greater than the TTP, Tenant Rent is zero and there is a Utility Reimbursement Payment (URP) The URP is the difference between the TTP and the Utility Allowance (Tenant credit on bottom line 10f of 50058)

30. Slide #30 Utility Allowances  TTP $80  - UA 50  Tenant Rent $30  TTP 40  - UA 50  Tenant Rent0  URP$10

31. Slide #31 Rent Calculation  Learning activity 3  Income-based rent calculation on 50058 8a = $12,3128y = $10,020 Minimum rent = $50 Flat Rent = $550 Utility Allowance = $75

32. Slide #32 Learning Activity 3 Answers 1,026 103 251 N 30 835 50 0

33. Slide #33 Learning Activity 3 Answers 251 176 251 X 550 75

34. Slide #34 Rent Calculation  Learning activity 4  Income-based rent calculation on 50058 8a = $3,2128y = $792 Minimum rent = $25 Flat Rent = $425 Utility Allowance = $100

35. Slide #35 Learning Activity 4 Answers 268 27 20 27 N 30 66 25 0

36. Slide #36 Learning Activity 4 Answers 27 73 27 X 425 100

37. Slide #37 Ceiling Rents  Purpose to set a maximum rent families will pay in PH, regardless of how high their income goes  Used prior to existence of flat rents

38. Slide #38 Retaining Ceiling Rents  As of 10/1/2002, ceiling rents had to be adjusted to flat rent level PH OCC Guidebook says flat rent + utility allowance = ceiling rent  No time limit on ceiling rents

39. Slide #39 Ceiling Rent Calculation  Calculate TTP as normal 30% of monthly adjusted income 10% of monthly income Welfare Rent (if applicable) PHA's minimum TTP ($0 - 50 – PHA Policy) then…

40. Slide #40 Ceiling Rent Calculation  Use the lesser of: TTP just calculated Ceiling rent for the unit  Formula: TTP (ceiling rent) - UA = tenant rent

41. Slide #41 Rent Calculation  Learning activity 5  Income-based ceiling rent calculation TTP = $ 398 Ceiling rent = $ 350 Flat Rent = $ 325 Utility Allowance = $ 25

42. Slide #42 Learning Activity 5 Answers 398 325 350 X 325 25

43. Slide #43 Flat Rents  Effective for families admitted or recertified on/after 10/1/99  There must be a flat rent established for each unit  Flat rent has no formula based limit on what tenant pays Utility allowances are not deducted Flat Rent = THE RENT

44. Slide #44 Flat Rents  Flat Rent is: based on PHA determination of rental value of the unit designed to not create a disincentive for families to stay in PH as their income increases  Recertifications are done not less than once every 3 years

45. Slide #45 Flat Rent Methodology  Market value is rent which would allow the unit to be successfully rented after preparation for occupancy  Acceptable methodology incorporates the same 9 factors used in Section 8 rent reasonableness methodology

46. Slide #46 Flat Rent Methodology Age Location Quality Amenities Size of unit  Relevant factors must include: Housing services Maintenance Utilities provided by PHA Unit type

47. Slide #47 Flat Rents: Family Choice  Families elect annually whether to pay income based or flat rent  If family has elected to pay flat rent but has a hardship and is unable to pay, the PHA must allow the family to switch to income based rent  Income needs to be reviewed only every 3 years

48. Slide #48 Switching Rent Determination Methods  Allowable hardships to switch from flat to income based rent income decreased due to family circumstances  loss or reduction of employment or other income  death in the family

49. Slide #49 Switching Rent Determination Methods  Allowable hardships to switch from flat to income based rent expenses increased, due to changed circumstances  medical costs  child care  transportation, education or similar items  other situations in PHA policy

50. Slide #50 Rent Calculation  Learning Activity 6  Flat rent calculation TTP = $ 450 Flat Rent = $ 400

51. Slide #51 Learning Activity 6 Answers 450 X 400

52. Slide #52 Proration of Assistance  Mixed Families receive prorated assistance Must use PHA’s maximum rent schedule to determine prorated TTP DO NOT use ceiling rent in lieu of TTP Special rules for Mixed Families requesting Flat Rent – see 50058 Instruction Booklet, Appendix 3

53. Slide #53 Proration of Assistance  Methodology for calculating PH maximum rent Included in session materials Download for reference

54. Slide #54 Proration Exercise  Learning activity 7 50058 lines 10h through 10s  2 family members are eligible; 1 is ineligible  TTP: $174  PHA maximum rent is $325  Flat rent: $500

55. Slide #55 Learning Activity 7 Answers 174 X 500

56. Slide #56 Learning Activity 7 Prorated Rent Answers 325 101 45 179 3 2 151 224

57. Slide #57 NMA Lunch ‘n’ Learn Seminar NEXT TOPIC…

58. Slide #58 NMA Lunch ‘n’ Learn Seminar