Julie Miles, Financial Analyst HUD-Kansas City, KS

Agenda New FDS New Proposed PHAS Asset Management Delay: PHAs With Units 2

New FDS Format AMP Level Financial Reporting Operating Fund and Capital Fund Reporting at AMP Level vs. PHA Level 1 Balance Sheet per AMP – Operating Fund & Capital Fund Combined 2 Income Statements per AMP – Operating Fund & Capital Fund Separate New Columns AMP & COCC Columns Replace Low-Rent and CFP Columns Elimination Column Subtracts Internal COCC/AMP Transactions from Entity-Wide Totals New 5-Digit Line Number Format for Revenues & Expenses 3

New FDS Line Items & Detail Links FDS Line Definition Guide October d_2008.pdf Fee Revenues & Fee Expenses Line Items Expense Line Items: Other Operating-Administrative, Sewer, Insurance Premiums Memo Accounts: Excess Cash & CFP Expenditure Data Ordinary Maintenance & Operations-Contract Costs: Garbage & Trash Removal, Heating & Cooling, Snow Removal, Elevator Maintenance, Landscape & Grounds, Unit Turnaround, Electrical, Plumbing, Extermination, Janitorial, Routine Maintenance, Miscellaneous 4

Transition Year Due Dates Unaudited – Normally Due 2 Months After FYE 6/30/08, 9/30/08 & 12/31/08 Due 4/13/09 3/31/09 Due 6/30/09 Federal Register Vol. 73, No. 163, 8/21/08 Docket FR-5227-N-01 Audited Expect System to Be Open in April Due Dates Will Be Announced Once System Open Electronically to REAC Paper Copy to Field Office Financial Analyst 5

New Proposed PHAS Starting FYE 6/30/08 First Year Transitional Scores Proposed Rule sprule.pdf sprule.pdf First Year CFP Bonus Based on Previous PHAS Score Scoring 30 Physical Condition 20 Financial Condition 40 Management Operations 10 CFP Management No Resident Survey 6

Proposed Physical Condition Still 30 points Scored at AMP Level Instead of Development Same UPCS Inspection Criteria Frequency Depends on AMP Score—Not PHA Score 7

Proposed Financial Condition 20 points Scored at AMP Level Most Indicators Moved to Management Operations Based on Unaudited Financial Submission & Adjusted for Audited Financial Submission Penalties Significant Change Between Unaudited & Audited Financial Statements Qualified, Adverse of Disclaimer of Audit Opinion Audit Findings 8

Proposed Financial Condition (continued) 3 Sub-Indicators (1) Quick Ratio (QR) Formerly Current Ratio Current Assets ÷ Current Liabilities 9 points (2) Months Expendable Net Assets Ratio (MENAR) Formerly Months Expendable Fund Balance (MEFB) (Current Assets - Current Liabilities) ÷ Average Monthly Operating Expenses 9 points (3) Debt Service Coverage Ratio (DSCR) Adjusted Operating Income ÷ Annual Debt Service If No Long-Term Debt, PHA Gets All Points 2 points 9

Proposed Management Operations 40 points Scored at AMP Level Scoring Adjustments – 1 Point Each Physical Condition – Projects 28 Years & Older Neighborhood Environment – 40% or More Families Income Below Poverty Rate on Latest Census 10

Proposed Management Operations (continued) HUD On-site Review Instead of PHA Self- Certification Includes Items Previously Scored Under Financial 7 Sub-Indicators: (1) General Appearance & Security 1.1 Appearance & Market Appeal (5 points) 1.2 Security (1 point) (2) Follow-Up & Monitoring of Project Inspections 2.1 Exigent Health & Safety Deficiencies (not scored) 2.2 Lead-Based Paint Inspection Deficiencies (not scored) 11

Proposed Management Operations (continued) 7 Sub-Indicators (continued) (3) Maintenance & Modernization 3.1 Unit Inspections (1 point) 3.2 Work Orders (3 points) 3.3 Preventive Maintenance (1 point) 3.4 Energy Conservation/Utility Consumption (1 point) 3.5 Modernization (not scored) (4) Financial Management 4.1 Percentage of Accounts Payable (4 points) 4.2 Rent Collection (4 points) 4.3 Budget Management (not scored) 4.4 Procurement (not scored) 12

Proposed Management Operations (continued) 7 Sub-Indicators (continued) (5) Leasing & Occupancy 5.1 Vacancy Rate (16 points) 5.2 Turnaround Time (2 points) 5.3 Occupancy Review (not scored) (6) Tenant/Management Relations 6.1 Economic Self-Sufficiency (1 point) 6.2 Resident Involvement in Project Administration (1 point) (7) General Management Practices 7.1 Management Review Findings (not scored) 7.2 Other Prior Review Findings (not scored) 7.3 Insurance (not scored) 13

Proposed CFP Management 10 points Scored at PHA-level, not AMP Time to Obligate & Expend CFP for Grants with Fund Balances During Assessed Period 14

Asset Management Delay PIH Notice Appropriations Act Section 225 PHAs PH Units Elect to Delay AM Implementation 1 Year Report FDS at PHA-Level, not AMP-Level Submit OpSub at AMP-Level, not PHA-Level Excludes Stop-Loss Assume Provision Will Continue in 2009 If Not Continued, Guidance Will Be Provided 15