[Code of Federal Regulations]

[Title 24, Volume 4]

[Revised as of April 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 24CFR990.230]



[Page 720-721]

 

                 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 F_Transition Policy and Transition Funding

 

Sec.  990.230  PHAs that will experience a subsidy reduction.



    (a) For PHAs that will experience a reduction in their operating 

subsidy, as determined in Sec.  990.225, such reductions will have a 

limit of:

    (1) 24 percent of the difference between the two funding levels in 

the first year following implementation of the formula contained in this 

part;

    (2) 43 percent of the difference between the two funding levels in 

the second year following implementation of the formula contained in 

this part;

    (3) 62 percent of the difference between the two levels in the third 

year following implementation of the formula contained in this part; and

    (4) 81 percent of the difference between the two levels in the 

fourth year following implementation of the formula contained in this 

part.

    (b) The full amount of the reduction in the operating subsidy level 

shall be realized in the fifth year following implementation of the 

formula contained in this part.

    (c) For example, a PHA has a subsidy reduction from $1 million under 

the formula in effect prior to implementation of the formula contained 

in this part to $900,000 under the formula contained in this part using 

FY 2004 data. The difference would be calculated at $100,000 ($1 

million-$900,000 = $100,000). In the first year, the subsidy reduction



[[Page 721]]



would be limited to $24,000 (24 percent of the difference). Thus, the 

PHA will receive an operating subsidy amount of this rule plus a 

transition-funding amount of $76,000 (the $100,000 difference between 

the two subsidy amounts minus the $24,000 reduction limit).

    (d) If a PHA can demonstrate a successful conversion to the asset 

management requirements of subpart H of this part, as determined under 

paragraph (f) of this section, HUD will discontinue the reduction at the 

PHA's next subsidy calculation following such demonstration, as 

reflected in the schedule in paragraph (e) of this section, 

notwithstanding Sec.  990.290(c).

    (e) The schedule of reductions for a PHA that will experience a 

reduction in subsidy is reflected in the table below.



----------------------------------------------------------------------------------------------------------------

                                  Demonstration dated

         Funding period                    by                             Reduction limited to

----------------------------------------------------------------------------------------------------------------

Prior to year 1.................  October 1, 2006....  5 percent of the difference between

                                                       the two funding levels.

Year 1..........................  October 1, 2007....  24 percent of the difference.

Year 2..........................  October 1, 2008....  43 percent of the difference.

Year 3..........................  October 1, 2009....  62 percent of the difference.

Year 4..........................  October 1, 2010....  81 percent of the difference.

Year 5..........................  October 1, 2011....  Full reduction reached.

----------------------------------------------------------------------------------------------------------------



    (f)(1) For purposes of this section, compliance with the asset 

management requirements of subpart H of this part will be based on an 

independent assessment conducted by a HUD-approved professional familiar 

with property management practices in the region or state in which the 

PHA is located.

    (2) A PHA must select from a list of HUD-approved professionals to 

conduct the independent assessment. The professional review and 

recommendation will then be forwarded to the Assistant Secretary for 

Public and Indian Housing (or designee) for final determination of 

compliance with the asset management requirements of subpart H of this 

part.

    (3) Upon completion of the independent assessment, the assessor 

shall conduct an exit conference with the PHA. In response to the exit 

conference, the PHA may submit a management response and other pertinent 

information (including, but not limited to, an additional assessment 

procured at the PHAs' own expense) within ten working days of the exit 

conference to be included in the report submitted to HUD.

    (4) In the event that HUD is unable to produce a list of independent 

assessors on a timely basis, the PHA may submit its own demonstration of 

a successful conversion to asset management directly to HUD for 

determination of compliance.

    (5) The Assistant Secretary for Public and Indian Housing (or 

designee) shall consider all information submitted and respond with a 

final determination of compliance within 60 days of the independent 

assessor's report being submitted to HUD.



[70 FR 54997, Sept. 19, 2005; 70 FR 61367, Oct. 24, 2005]