[Federal Register Volume 85, Number 46 (Monday, March 9, 2020)]
[Notices]
[Pages 13669-13670]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-04768]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-6202-N-01]
Section 8 Housing Assistance Payments Program--Fiscal Year 2020
Inflation Factors for Public Housing Agency Renewal Funding
AGENCY: Office of the Assistant Secretary for Policy Development and
Research, HUD.
[[Page 13670]]
ACTION: Notice.
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SUMMARY: This notice establishes Renewal Funding Inflation Factors to
adjust Fiscal Year (FY) 2020 renewal funding for the Housing Choice
Voucher (HCV) program of each public housing agency (PHA), as required
by the Further Consolidated Appropriations Act, 2020. The notice
apportions the expected percent change in national Per Unit Cost (PUC)
for the HCV program, 4.25 percent, to each PHA based on the change in
Fair Market Rents for their operating area to produce the FY 2020
RFIFs. HUD's FY 2020 methodology is the same as that which was used in
FY 2019.
DATES: Applicable Date: March 9, 2020.
FOR FURTHER INFORMATION CONTACT: Miguel A. Fontanez, Director, Housing
Voucher Financial Division, Office of Public Housing and Voucher
Programs, Office of Public and Indian Housing, telephone number 202-
402-4212; or for technical information regarding the development of the
schedules for specific areas or the methods used for calculating the
inflation factors, Peter B. Kahn, Director, Program Parameters and
Research Division, Office of Policy Development and Research, telephone
number 202-402-2409. Their mailing address is: Department of Housing
and Urban Development, 451 7th Street SW, Washington, DC 20410.
Hearing- or speech-impaired persons may contact the Federal Relay
Service at 800-877-8339 (TTY). (Other than the ``800'' TTY number, the
above-listed telephone numbers are not toll free.)
SUPPLEMENTARY INFORMATION:
I. Background
Division H, Title II of the Further Consolidated Appropriations
Act, 2020 states that the HUD Secretary ``for the calendar year 2020
funding cycle shall provide renewal funding for each public housing
agency based on validated voucher management system (VMS) leasing and
cost data for the prior calendar year and by applying an inflation
factor as established by the Secretary, by notice published in the
Federal Register . . .'' This notice announces the availability of the
FY 2020 inflation factors and describes the methodology for calculating
them. Tables in PDF and Microsoft Excel formats showing Renewal Funding
Inflation Factors (RFIFs) by HUD Fair Market Rent (FMR) Area are
available electronically from the HUD data information page at: https://www.huduser.gov/portal/datasets/rfif/rfif.html.
II. Methodology
RFIFs are used to adjust the allocation of Housing Choice Voucher
(HCV) program funds to PHAs for local changes in rents, utility costs,
and tenant incomes. To calculate the RFIFs, HUD first forecasts a
national inflation factor, which is the predicted annual change in the
national average Per Unit Cost (PUC). HUD then calculates individual
area inflation factors, which are based on the annual changes in the
two-bedroom FMR for each area. Finally, HUD adjusts the individual area
inflation factors to be consistent with the national inflation factor.
HUD's forecast of the national average PUC is based on forecasts of
gross rent and tenant income. Each forecast is produced using
historical and forecasted macroeconomic data as independent variables,
where the forecasts are consistent with the Economic Assumptions of the
Administration's FY 2021 Budget. The forecast of gross rent is itself
based on forecasts of the Consumer Price Index (CPI) Rent of Primary
Residence Index and the CPI Fuels and Utilities Index. Forecasted
values of these two CPI series are applied to the FY 2020 national
average two-bedroom FMR to produce a CY 2020 gross rent value. A
``notional'' PUC is calculated as the difference between gross rent
value and 30 percent of tenant income (the standard for tenant rent
contribution in the voucher program). The forecast of tenant income is
based on a model that uses HUD administrative data and employment data
from the Bureau of Labor Statistics. The change between the forecasted
CY 2020 notional PUC and the CY 2019 notional PUC is the expected
national change in PUC, or 4.25 percent. HUD uses notional PUCs as
opposed to actual PUCs because notional PUCs are not affected by
differences in the number and quality of units among PHAs. For more
information on HUD's forecast methodology, see 82 FR 26710.
The inflation factor for an individual geographic area is based on
the annualized change in the area's FMR between FY 2019 and FY 2020.
These changes in FMRs are then scaled such that the voucher-weighted
average of all individual area inflation factors is equal to the
national inflation factor, i.e., the expected annual change in national
PUC from CY 2019 to CY 2020, and such that no area has a factor less
than one. For PHAs operating in multiple FMR areas, HUD calculates a
voucher-weighted average inflation factor based on the count of
vouchers in each FMR area administered by the PHA as captured in HUD
administrative data as of December 31, 2019.
III. The Use of Inflation Factors
HUD subsequently applies the calculated individual area inflation
factors to eligible renewal funding for each PHA based on VMS leasing
and cost data for the prior calendar year.
IV. Geographic Areas and Area Definitions
As explained above, inflation factors based on area FMR changes are
produced for all FMR areas and applied to eligible renewal funding for
each PHA. The tables showing the RFIFs, available electronically from
the HUD data information page, list the inflation factors for each FMR
area on a state-by-state basis. The inflation factors use the same OMB
metropolitan area definitions, as revised by HUD, that are used for the
FY 2020 FMRs. PHAs should refer to the Area Definitions Table on the
following web page to make certain that they are referencing the
correct inflation factors: http://www.huduser.org/portal/datasets/rfif/FY2020/FY2020_RFIF_FMR_AREA_REPORT.pdf. The Area Definitions Table
lists areas in alphabetical order by state, and the counties associated
with each area. In the six New England states, the listings are for
counties or parts of counties as defined by towns or cities. HUD is
also releasing the data in Microsoft Excel format to assist users who
may wish to use these data in other calculations. The Excel file is
available at https://www.huduser.gov/portal/datasets/rfif/rfif.html.
Note that, as described earlier, the actual renewal funding inflation
factor applied to agency funding will be the voucher-weighted average
of the FMR area factors when the PHA operates in multiple FMR areas.
V. Environmental Impact
This notice involves a statutorily required establishment of a rate
or cost determination which does not constitute a development decision
affecting the physical condition of specific project areas or building
sites. Accordingly, under 24 CFR 50.19(c)(6), this notice is
categorically excluded from environmental review under the National
Environmental Policy Act of 1969 (42 U.S.C. 4321).
Dated: March 2, 2020.
Todd M. Richardson,
General Deputy, Assistant Secretary for Policy, Development and
Research.
[FR Doc. 2020-04768 Filed 3-6-20; 8:45 am]
BILLING CODE 4210-67-P