1. Housing Choice Voucher Program CY 2013 Renewal Implementation Financial Management Division May 28, 2013

2. Today’s Topics CY 2013 Voucher Renewal Funding CY 2013 Obligations and Disbursements CY 2013 HAP Set-Aside CY 2013 Administrative Fees

3. CY 2013 Voucher Renewal Funding HUD operated under Continuing Resolution through March 27, 2013 (Public law 112-175) CR provided funding at FY 2012 Appropriations level, inflated.612 percent Allotments were received through March 27 based on this level of funding Obligations and disbursements were made to PHAs for January through June per this CR

4. CY 2013 Voucher Renewal Funding Both chambers of Congress passed and the President executed a full-year CR on March 26, 2013 (P.L. 113- 06) Presidential FY 2013 request for tenant-based rental assistance (TBRA) had been $19.023 billion, compared to $18.914 billion enacted for FY 2012 CR provides approximately $17.964 billion for all TBRA purposes Details of funding and implementation are provided in PIH Notice 2013-12

5. CY 2013 Voucher Renewal Funding FFY 2013 funding includes sequestration and an across the board (ATB) reduction, which reduce Voucher program funding by approximately 5 percent and.2 percent of the FFY 2012 appropriated amount inflated by.612 percent Sequestration affects FFY 2013 Appropriations, which are used to fund the Voucher program for CY 2013 Sequestration covers both HAP and administrative fee funding and all other categories of funds, but exempts funds for VASH HUD has no flexibility to assign reductions

6. CY 2013 Voucher Renewal Funding 2012 HAP Renewal Funds: $17,242,351,000 – Less $103,000,000 for Set-Aside 2013 HAP Renewal Funds: $16,349,364,819 – Less $103,000,000 for Set-Aside Non-VASH Pro-ration: 93.976% VASH Pro-ration: 99.005% 2012 Administrative Fees: $1,350,000,000 2013 Administrative Fees: $1,305,528,489 Expected Pro-ration: approximately 69%

7. CY 2013 Voucher Renewal Funding 2013 Appropriations following Sequestration: HAP Renewal funding $16,349,364,819 Tenant Protection Vouchers $71,077,050 Administrative Fees $1,305,528,490 Family Self- Sufficiency $56,861,640 Veterans Affairs Supportive Housing $74,850,000 Mainstream 5 Year Program $106,158,786 Total Available CY 2013 Appropriations $17,963,840,785

8. CY 2013 Voucher Renewal Funding PHA renewal funding allocations have been calculated per the CR and were issued on May 23 Renewal formula follows the requirements for 2012, with one addition: – Actual validated HAP costs for latest calendar year (CY 2012) – per VMS as of March 7 deadline or as subsequently revised at HUD direction – Adjustments for first time renewals – to ensure increments that were initially funded for fewer than 12 months are fully funded through December 31, 2013, and that initial funds are inflated for new increments that span 2012 and 2013

9. CY 2013 Voucher Renewal Funding Renewal formula follows the requirements for 2012, with one addition: – Adjustments under the Disaster Relief Appropriations Act, for PHAs who experienced a presidentially declared natural disaster in FFY 2013 – requests were due April 30 and any additional eligibility calculated – Renewal Inflation Factor applied – overall, these are very modest – National Pro-ration Factor applied – determined by comparing national eligibility to funds appropriated; same factor applies to all PHAs (non-MTW and MTW)

10. CY 2013 Voucher Renewal Funding Each PHA’s pro-rated eligibility was compared to renewal funds obligated for January thru June – Thru June, if obligations are less than pro-rated eligibility, the difference will be obligated – Thru June, if obligations exceed pro-rated eligibility, remaining pro-rated eligibility will be spread over the remaining months of CY 2013 There is no Net Restricted Assets offset for CY 2013

11. CY 2013 Voucher Renewal Funding ELIGIBILITY - VASH CALCULATIONS 3 Total VASH Unit Months Leased per VMS - CY 20122,047 4Total VASH Unit Months Available - CY 20123,285 5VASH Capping Percentage (see Notes)100.00% 6Total CY 2012 VASH HAP Expenses per VMS$1,309,731 7 Total Capped VASH HAP Expenses (Line 5 x Line 6)$1,309,731 8Renewal Funding Inflation Factor1.000 9 Inflated Eligibility Sub-Total VASH (Line 7 x Line 8)$1,309,731 10 First Time Renewals VASH$0 11 VASH Transfers In or Out$0 12 Total VASH Renewal Eligibility (Line 9 + Line 10 + Line 11)$1,309,731

12. CY 2013 Voucher Renewal Funding ELIGIBILITY - NON-VASH CALCULATIONS 13 Total Non-VASH Unit Months Leased per VMS - CY 2012104,084 14 Total Non-VASH Unit Months Available - CY 2012102,267 15Non-VASH Capping Percentage (see Notes)99.44% 16 Total CY 2012 non-VASH HAP Expenses per VMS$70,052,077 17 Total Capped non-VASH HAP Expenses (Line 15 x Line 16)$69,662,390 18Renewal Funding Inflation Factor1.000 19 Inflated Eligibility Sub-Total non-VASH (Line 17 x Line 18)$69,662,390 20First Time Renewals non-VASH$9,990 21 Non-VASH Transfers In or Out$0 22 Sub-Total Non-VASH Renewal Eligibility (Line 19 + Line 20 + Line 21)$69,672,380

13. CY 2013 Voucher Renewal Funding 23DHAP Eligibility$0 24Renewal Funding Inflation Factor1.000 25 Total Inflated Eligibility DHAP (Line 23 x Line 24)$0 26 FFY 2013 Disaster Adjustment$0 27Total Non-VASH Renewal Eligibility (Line 22 + Line 25 + Line 26) $69,672,380

14. CY 2013 Voucher Renewal Funding FUNDING 28 Total VASH Renewal Eligibility (Line 12)$1,309,731 29 VASH Pro-Ration Factor0.99005 30 Total VASH Renewal Funding (Line 28 x Line 29)$1,296,699 31 Total Non-VASH Renewal Eligibility (Line 27)$69,672,380 32 Non-VASH Pro- Ration Factor0.93976 33 Total Non-VASH Renewal Funding (Line 31 x Line 32)$65,475,316 34 Total CY 2013 Renewal Funding (Line 30 + Line 33)$66,772,015 35Less Amount Due HUD from PHA$0 36Final CY 2013 Renewal Funding$66,772,015

15. CY 2013 Voucher Renewal Funding 37 Renewal Funding Obligations, January through June 2013 $34,277,958 38 Remaining to Obligate for CY 2013 (Line 36 - Line 37)$32,494,057 39 Obligations Due Through June, 2013 (Line 36 x 50%)$33,386,008 40 Additional Obligations Due Through June, 2013 (Line 39 - Line 37, if Line 39 is higher; else 0)$0 41 Excess Obligations Through June, 2013 (Line 37 - Line 39, if Line 37 is higher; else 0)$891,950 42 Monthly Obligation, July 2013$5,415,677 43 Monthly Obligations, August through December, 2013 (Line 38 - Line 40 - Line 42, divided by 5)$5,415,676

16. CY 2013 Voucher Renewal Funding New Increments Renewed in CY 2013: Listed below are funding increments for which the PHA is receiving an additional inflation factor in CY 2013 to support increased costs since the increments were initially funded, or is receiving funding to complete the initial 12 months of new increments previously funded for a shorter term. PHA NumberFunding Increment NumberExpiration DateNumber of Units Inflation Funding Funding for Short Term Increments HA001HA001VO01003/31/201340$0 HA001HA001VO01013/31/20132$0$9,990

17. CY 2013 Non-Renewal Voucher Funding Funding for tenant protection vouchers and Mod Rehab renewals is subject to ATB reduction and sequestration – If HUD determines it has insufficient BA to fully fund all actions, funding will be provided for fewer months, and the missed months will be fully funded later Funding for new VASH awards is not subject to sequestration

18. CY 2013 Obligations January thru April obligations were based on a projected pro-ration of estimated CY 2013 eligibility, without sequestration May and June obligations also based on a projected pro-ration, including expected sequestration Estimated eligibility was calculated using CY 2012 actual VMS costs for validated months and an inflated value remaining months, with no adjustment for new units and no CY 2013 estimated inflation

19. CY 2013 Disbursements Disbursements have been based throughout on cash management requirements per Notice PIH 2011-67 January thru March based on actual HAP expenses of July thru September 2012, plus margin, limited monthly to 1/12 of expected CY 2013 actual eligibility (obligations) – Reductions were made for cash due HUD for excess disbursements through 3 rd quarter of 2012

20. CY 2013 Disbursements April thru June calculated disbursements were based on actual average costs for October thru December 2012, plus 3% margin Limited to obligated amount To ensure PHA could cover costs wherever possible to date, HUD took these steps: – Disbursed any undisbursed BA obligated for CY 2012 and CY 2013 – Assumed PHAs would use the lesser of available NRA or cash/investments

21. CY 2013 Disbursements – Provided frontloads against CY 2013 ultimate eligibility, where undisbursed BA and cash/investments were insufficient For the balance of CY 2013: – PHAs must still assess level of program they can support across the CY – Based on total HAP funding available, actual expenses to date and projected expenses – Disbursements for the balance of CY will be calculated per cash management requirements – Frontloads will continue to be available, up to the total budget authority obligated for the PHA

22. CY 2013 HAP Set-Aside $103,000,000 total available Application deadline for all categories: June 24, 2013 Category 1 applications receive priority for funding Category 1 applications may be submitted after June 24, but those requests will be funded on a first come – first served basis PHAs submitting Category 1 applications by the deadline can expect a preliminary response and commitment by July 24

23. CY 2013 HAP Set-Aside Category 2 thru 4 applications will not be considered until after Category 1 applications received by June 24 are reviewed and eligible PHAs are funded Application requirements are detailed in the CY 2013 implementation notice (PIH 2013-12) – Applications may be submitted in hard copy or electronically – Applications must be received, not just mailed, by the deadline – PHA should submit only one application for Categories 2 thru 4

24. CY 2013 HAP Set-Aside Category 1: Shortfall – Purpose: to prevent termination of assistance in cases where the PHA has taken all reasonable cost containment steps but still is projected to incur a shortfall in CY 2013 – HUD will calculate the projected shortfall based on the Two Year Forecasting Tool which will compare all resources available for HAP costs in CY 2013 to actual HAP expenses projected for the year

25. CY 2013 HAP Set-Aside Category 1: Shortfall - Resources include: – NRA as of 12/31/2012 – HUD-Held Reserves as of 12/31/2012 – CY 2013 Renewal Budget Authority – CY 2013 portion of any incremental voucher awards – CY 2013 set-aside projected or actual

26. CY 2013 HAP Set-Aside Category 1: Shortfall – Expenses based on: – Current leasing and expense data, projected through CY end – PHA suspension of general voucher issuance as of March 31, 2013 – Projected attrition based on actual attrition of prior 12 months, per PIC

27. CY 2013 HAP Set-Aside Category 1: Shortfall – PHA must certify as follows on Attachment A to the notice: (1) At the time of application, the PHA must be working with the shortfall prevention team (SPT) and must be in a confirmed shortfall position per the SPT (2) PHA must have stopped issuing vouchers except for new awards, movers, and homeless veterans under a new allocation (3) PHA must have rescinded any outstanding vouchers as of HUD’s April 26 letter, except for the exceptions above

28. CY 2013 HAP Set-Aside Category 1: Shortfall (4) PHA has stopped or immediately stops absorbing portable vouchers (5) PHA may not issue a voucher to a resident of a project-based unit who wants to move; project-based units will be re-filled from the waiting list

29. CY 2013 HAP Set-Aside Category 1: Shortfall – Factors HUD will consider: – NRA Balance: as reported by PHA for 12/31/2012, or less if a change is confirmed – HUD-Held Reserve Balance: as determined by HUD – CY 2013 Renewal BA: as determined by HUD – CY 2013 incremental and set-aside funds: as determined by HUD – UMLs: latest actual per VMS, projected through 2013, using PHA’s actual attrition, and allowed new leasing

30. CY 2013 HAP Set-Aside Category 1: Shortfall – Factors HUD will consider: – HAP Expenses, based on UMLs and latest average per unit cost from VMS – Planned changes in leasing – Year-End Balance: PHAs with a projected year-end negative NRA and Reserve balance will be deemed eligible for funding PHAs may apply for shortfall set-aside more than once if their situations change PHA must submit complete and executed Attachment A from the Notice for each request If a PHA thinks they will have a shortfall and are not working with SPT, contact your field office now; they will determine if you should be referred to SPT

31. CY 2013 HAP Set-Aside Category 2a: Unforeseen Circumstances – Circumstances must have occurred during or after the re-benchmarking period and been out of the control of the PHA and must have caused an increase in renewal costs – Examples: Significant increase in renewal costs due to unforeseeable rise in rental costs, beyond that anticipated by the inflation factor – show evidence, effect and a calculation of increased costs

32. CY 2013 HAP Set-Aside Category 2a: Unforeseen Circumstances – Examples: Increase in per unit HAP costs when compared to funded rate, due to economic conditions resulting in decreased average total tenant payment – PHA must document the event and the results – PHA must submit a calculation of need – PHA must submit completed and signed Attachment B from the Notice

33. CY 2013 HAP Set-Aside Category 2b: Portability – PHA must have experienced a significant increase in renewal costs due to tenant-based portability during the re-benchmarking period – PHA will be eligible for the difference between the average portable HAP PUC and 110% of the PHA’s average per unit cost, for each unit month that portable costs were paid in CY 2012 – All calculations performed by HUD based on VMS data

34. CY 2013 HAP Set-Aside Category 2b: Portability – PHA should submit no documentation, and none will be reviewed – PHA must submit completed and signed Attachment B from the Notice

35. CY 2013 HAP Set-Aside Category 3: Project-Based Vouchers – Vouchers must have been withheld from use for months in CY 2012 in order to be available to meet a project-based commitment under Section 8(o)(13) – Applies only to new construction and substantial rehabilitation units – Vouchers will be funded only to the extent that, when added to renewal vouchers, they do not exceed the PHA’s baseline

36. CY 2013 HAP Set-Aside Category 3: Project-Based Vouchers – PHA must submit completed and signed Attachment B from the Notice – PHA must submit completed Attachment C (vouchers withheld from leasing) and D (project information) for each project-based commitment – PHA must submit identified sections of the executed AHAP and the HAP contract, if executed, or a statement that HAP has not been executed

37. CY 2013 HAP Set-Aside Category 4: HUD-VASH – PHAs funded program-wide PUC for CY 2013 must be less than the latest actual average PUC for its VASH vouchers, per VMS – PHA must provide actual VASH costs and leasing and a calculation of funding needed All categories are subject to pro-ration based on funds available Categories 2 thru 4 will not be funded if all funds are required to avert shortfalls

38. Administrative Fees (AF) AF funds are advanced monthly, based on latest actual eligibility Due to year-long CR and sequestration, AF payments for CY 2013 will reconcile quarterly at approximately 69 percent of eligibility PHAs must take actions to reduce costs if fees and UNA are insufficient – Notice PIH 2012-15 discusses streamlining administrative practices to reduce costs – HAP funds may not be used for admin costs

39. Administrative Fees (AF) CY 2013 AF schedules have been posted to the HCV website – If calculated fee rates for an area have decreased, HUD held rates to CY 2012 level PHA requests for higher admin fees or blended fee rates were due to HUD by April 30 – PHAs should receive responses by mid to late June AF Set-Aside will be used to provide fees for specirfic purposes:

40. Administrative Fees (AF) – $200 per homeownership closing – $200 per voucher for occupied Multifamily units at conversion – Special fees for PHAs that administer portable vouchers as a significant portion of their inventory Eligibility and calculations not finalized – will be forthcoming HUD will determine funding; PHAs do not need to apply – Disaster fee adjustments for PHAs affected by declared natural disaster in FFY 2013

41. Program Requirements HAP funds and NRA may not be transferred to or used for any purpose other than eligible Hap expenses for baseline vouchers PHAs, other than MTW, may not use appropriated HAP funds to lease in excess of baseline HUD intends in CY 2013 to recoup all remaining NRA funds into HUD-Held Reserves PHAs are responsible for accurate reporting to HUD systems, including VMS and FASS, and are subject to sanctions for failure to report

42. Thank You! Please call or e-mail any questions – either to your FMC Financial Analyst or to PIH.Financial.Management.Division@hud.gov Thank you for the work you are doing under some difficult circumstances.