[Code of Federal Regulations]
[Title 24, Volume 4]
[Revised as of April 1, 2008]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR990.280]

[Page 722]
 
                 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 H_Asset Management
 
Sec. 990.280  Project-based budgeting and accounting.

    (a) All PHAs covered by this subpart shall develop and maintain a 
system of budgeting and accounting for each project in a manner that 
allows for analysis of the actual revenues and expenses associated with 
each property. Project-based budgeting and accounting will be applied to 
all programs and revenue sources that support projects under an ACC 
(e.g., the Operating Fund, the Capital Fund, etc.).
    (b)(1) Financial information to be budgeted and accounted for at a 
project level shall include all data needed to complete project-based 
financial statements in accordance with Accounting Principles Generally 
Accepted in the United States of America (GAAP), including revenues, 
expenses, assets, liabilities, and equity data. The PHA shall also 
maintain all records to support those financial transactions. At the 
time of conversion to project-based accounting, a PHA shall apportion 
its assets, liabilities, and equity to its respective projects and HUD-
accepted central office cost centers.
    (2) Provided that the PHA complies with GAAP and other associated 
laws and regulations pertaining to financial management (e.g., OMB 
Circulars), it shall have the maximum amount of responsibility and 
flexibility in implementing project-based accounting.
    (3) Project-specific operating income shall include, but is not 
limited to, such items as project-specific operating subsidy, dwelling 
and non-dwelling rental income, excess utilities income, and other PHA 
or HUD-identified income that is project-specific for management 
purposes.
    (4) Project-specific operating expenses shall include, but are not 
limited to, direct administrative costs, utilities costs, maintenance 
costs, tenant services, protective services, general expenses, non-
routine or capital expenses, and other PHA or HUD-identified costs which 
are project-specific for management purposes. Project-specific operating 
costs also shall include a property management fee charged to each 
project that is used to fund operations of the central office. Amounts 
that can be charged to each project for the property management fee must 
be reasonable. If the PHA contracts with a private management company to 
manage a project, the PHA may use the difference between the property 
management fee paid to the private management company and the fee that 
is reasonable to fund operations of the central office and other 
eligible purposes.
    (5) If the project has excess cash flow available after meeting all 
reasonable operating needs of the property, the PHA may use this excess 
cash flow for the following purposes:
    (i) Fungibility between projects as provided for in Sec. 990.205.
    (ii) Charging each project a reasonable asset management fee that 
may also be used to fund operations of the central office. However, this 
asset management fee may be charged only if the PHA performs all asset 
management activities described in this subpart (including project-based 
management, budgeting, and accounting). Asset management fees are 
considered a direct expense.
    (iii) Other eligible purposes.
    (c) In addition to project-specific records, PHAs may establish 
central office cost centers to account for non-project specific costs 
(e.g., human resources, Executive Director's office, etc.). These costs 
shall be funded from the property-management fees received from each 
property, and from the asset management fees to the extent these are 
available.
    (d) In the case where a PHA chooses to centralize functions that 
directly support a project (e.g., central maintenance), it must charge 
each project using a fee-for-service approach. Each project shall be 
charged for the actual services received and only to the extent that 
such amounts are reasonable.

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