[Code of Federal Regulations]
[Title 24, Volume 4]
[Revised as of April 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR990.401]

[Page 708-709]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
CHAPTER IX--OFFICE OF ASSISTANT SECRETARY FOR PUBLIC AND INDIAN HOUSING, 
               DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
 
PART 990--THE PUBLIC HOUSING OPERATING FUND PROGRAM--Table of Contents
 
      Subpart D--Resident Management Corporations Operating Subsidy
 
Sec. 990.401  Calculation of operating subsidy.

    Source: 59 FR 43644, Aug. 24, 1994, unless otherwise noted.


    Operating subsidy will be calculated separately for any project 
managed by a resident management corporation. This subsidy computation 
will be the same as the separate computation made for the balance of the 
projects in the PHA in accordance with this part, with the following 
exceptions:
    (a) The project managed by a resident management corporation will 
have an Allowable Expense Level based on the actual expenses for the 
project in the fiscal year immediately preceding management under this 
subpart. These expenditures will include the project's share of any 
expenses which are overhead or centralized HA expenditures. The expenses 
must represent a normal year's expenditures for the project, and must 
exclude all expenditures which are not normal fiscal year expenditures 
as to amount or as to the purpose for which expended. Documentation of 
this expense level must be presented with the project budget and 
approved by HUD. Any project expenditures funded from a source of income 
other than operating subsidies or income generated by the locally owned 
public housing program will be excluded from the subsidy calculation. 
For budget years after the first budget year under management by the 
resident management corporation, the Allowable Expense Level will be 
calculated as it is for all other projects in accordance with 
Sec. 990.105(e)(4).
    (b) The resident management corporation project will estimate 
dwelling rental income based on the rent roll of the project immediately 
preceding the assumption of management responsibility under this 
subpart, increased by the estimate of inflation of tenant income used in 
calculating PFS subsidy.
    (c) The resident management corporation will exclude, from its 
estimate of other income, any increased

[[Page 709]]

income directly generated by activities by the corporation or facilities 
operated by the corporation.
    (d) Any reduction in the subsidy of a HA that occurs as a result of 
fraud, waste, or mismanagement by the HA shall not affect the subsidy 
calculation for the resident management corporation project.

[59 FR 43644, Aug. 24, 1994, as amended at 61 FR 17542, Apr. 19, 1996]