Low income housing: Housing assistance payments (section 8)— based certificate and voucher programs merger into Housing Choice Voucher Program; amendment,

Text

---

Federal Register: November 3, 1999 (Volume 64, Number 212)Rules and RegulationsPage 59620-59622From the Federal Register Online via GPO Access [wais.access.gpo.gov]

DOCID:fr03no99-12

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 982

Docket No. FR-4428-F-05RIN 2577-AB91

Housing Choice Voucher Program; Amendment

AGENCY: Office of the Assistant Secretary for Public and Indian Housing, HUD.

ACTION: Final rule.

SUMMARY: On October 21, 1999, HUD published a final rule implementing the statutory merger of the Section 8 tenant-based certificate and voucher programs. This rule makes an amendment to the October 21, 1998 final rule concerning the 40 percent of adjusted monthly income initial rent burden limit. HUD is making this change based upon its reconsideration of the statutory language and legislative history regarding this requirement.

DATES: Effective Date: December 3, 1999.

FOR FURTHER INFORMATION CONTACT: Gerald J. Benoit, Office of Public and Indian Housing, Department of Housing and Urban Development, Room 4210, 451 Seventh Street, SW, Washington, DC 20410; telephone (202) 708-0477. (This is not a toll-free number.) Hearing or speech-impaired individuals may access this number via TTY by calling

[Page 59621]the toll-free Federal Information Relay Service at 1-800-877-8339.

SUPPLEMENTARY INFORMATION:

I. Background

On October 21, 1999 (64 FR 56894), HUD published a final rule implementing the statutory merger of the Section 8 tenant-based certificate and voucher programs. The October 21, 1999 final rule implemented section 545 of the Quality Housing and Work Responsibility Act of 1998 (Title V of the FY 1999 HUD Appropriations Act; Pub. L. 105-276, approved October 21, 1998) (referred to as the ``Public Housing Reform Act''). The new tenant-based program (known as the Housing Choice Voucher program) has features of the previously authorized certificate and voucher programs, plus new features. Interested persons should consult the preamble to the October 21, 1999 final rule for additional details. This final rule makes an amendment to new Housing Choice Voucher Program regulations at 24 CFR part 982.

The Public Housing Reform Act provides that at the time a family initially receives tenant based assistance under the Housing Choice Voucher Program with respect to any dwelling unit:

[T]he total amount that a family may be required to pay for rent may not exceed 40 percent of the monthly adjusted income of the family. (42 U.S.C. 1437f(o)(3), as amended by section 545 of the Public Housing Reform Act)

This statutory provision is currently implemented by Sec. 982.508.

This final rule provides that the initial rent burden restriction at Sec. 982.508 applies only to a family who leases a unit at a gross rent which exceeds the applicable payment standard for the family. This final rule provides that at the time the Public Housing Agency (PHA) approves a tenancy for initial occupancy of a dwelling unit by a family with assistance under the voucher program, and where the gross rent of the unit exceeds the applicable payment standard for the family, the family share of gross rent must not exceed 40 percent of the family's monthly adjusted income. Under this final rule, the initial rent burden restriction will not apply to a family that rents a unit for a gross rent (rent to owner plus tenant-paid utilities) at or below the payment standard for the family.

In the Housing Choice Voucher Program, the monthly assistance payment for a family that rents for a gross rent below the payment standard for the family is the gross rent minus the total tenant payment (TTP), as computed by a statutory formula. The TTP is the highest of:

1. 30 percent of monthly adjusted income;

2. 10 percent of monthly income;

3. In ``as-paid'' States (where the welfare housing grant is adjusted in accordance with actual housing cost), the portion of welfare assistance designated for housing; or

4. The PHA's minimum rent (from $0 to $50, as determined by the PHA).

Under the last three branches of this formula, the TTP (which is not covered by the voucher subsidy payment) for a family may exceed 40 percent of adjusted monthly income. HUD previously advised that such families may not rent a unit for a gross rent that exceeds the 40 percent initial rent burden limit.

On reconsideration of the statute and legislative history, HUD believes that the statute is only intended to place a restriction on the rent burden of a family who chooses to lease a unit for a rent that exceeds the payment standard applicable to the family.

The exact language later enacted as the initial rent burden restriction in the Public Housing Reform Act originated in the predecessor of the Public Housing Reform Act, as reported by the Senate Banking Committee in May, 1997 (Sen. Report 105-21, May 23, 1997). The Committee report specifies that the 40 percent rent burden limitation applies ``if the initial rent on a unit exceeds the payment standard'' (Sen. Report 105-21, page 34; see also, page 35). The Committee report also states that ``if the tenant wishes to lease a unit where the initial rent on a unit exceeds the payment standard'' tenants may pay the difference up to 40 percent of adjusted income (Sen. Report 105-21, page 56). The Committee report clearly indicates that the 40 percent rent burden limitation is not intended to apply for a family that rents below the payment standard, and whose statutory total tenant payment exceeds 40 percent of adjusted income.

Although this final rule will not take effect until December 3, 1999, PHAs are advised that the amendment made by this final rule better reflects the intent of the Congress in enacting the ``40 percent rent burden limit.'' PHAs should, therefore, immediately begin to conform their practices and procedures to the language of Sec. 982.508, as amended by this final rule. In the meantime, pending the effective date of this rule, HUD does not anticipate imposing sanctions against PHAs that rely on the course set out here as a ``safe harbor.''

II. Justification for Final Rulemaking

In general, HUD publishes a rule for public comment before issuing a rule for effect, in accordance with its own regulations on rulemaking at 24 CFR part 10. Part 10, however, does provide for exceptions from that general rule where HUD finds good cause to omit advance notice and public participation. The good cause requirement is satisfied when the prior public procedure is ``impracticable, unnecessary, or contrary to the public interest'' (24 CFR 10.1). HUD finds that good cause exists to publish this rule for effect without first soliciting public comment, in that prior public procedure would be contrary to the public interest. This final rule amends the Housing Choice Voucher Program regulations at 24 CFR part 982 to more accurately reflect the Congressional intent regarding the ``40 percent initial rent burden.'' Upon reconsideration of the relevant statutory language and legislative history, HUD has determined that its initial interpretation (codified at Sec. 982.505) may contradict the intent of the Congress in enacting this provision. It is necessary for this rule not to be delayed to solicit public comments in order to correct any potential confusion on the part of PHAs and assisted families regarding the scope and applicability of this statutory requirement. Accordingly, HUD is publishing this rule for effect without prior public participation.

III. Findings and Certifications

Environmental Impact

A Finding of No Significant Impact with respect to the environment was made on HUD's May 14, 1999 interim rule implementing the statutory merger of the tenant-based Section 8 certificate and voucher programs, in accordance with HUD regulations in 24 CFR part 50 that implement section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4223). That Finding remains applicable to this final rule and is available for public inspection between 7:30 a.m. and 5:30 p.m. weekdays in the Office of the Rules Docket Clerk, Office of General Counsel, Room 10276, Department of Housing and Urban Development, 451 Seventh Street, SW, Washington, DC.

Unfunded Mandates Reform Act

Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. This final rule does not impose any Federal mandates on any State,

[Page 59622]local, or tribal governments or the private sector within the meaning of Unfunded Mandates Reform Act of 1995.

Impact on Small Entities

The Secretary, in accordance with the Regulatory Flexibility Act (5 U.S.C. 605(b)) (the RFA), has reviewed and approved this final rule and in so doing certifies that this rule would not have a significant economic impact on a substantial number of small entities. The final rule is exclusively concerned with public housing agencies that administer tenant-based housing assistance under Section 8 of the United States Housing Act of 1937. Specifically, the final rule would establish requirements governing tenant-based assistance for an eligible family. The final regulatory amendment would not change the amount of funding available under the Section 8 voucher program. Accordingly, the economic impact of this rule will not be significant, and it will not affect a substantial number of small entities.

Executive Order 13132, Federalism

Executive Order 13132 (entitled ``Federalism'') prohibits an agency from publishing any rule that has federalism implications if the rule either imposes substantial direct compliance costs on State and local governments and is not required by statute, or the rule preempts State law, unless the agency meets the consultation and funding requirements of section 6 of the Executive Order. This final rule does not have federalism implications and does not impose substantial direct compliance costs on State and local governments or preempt State law within the meaning of the Executive Order.

Catalog of Domestic Assistance Numbers

The Catalog of Domestic Assistance numbers for the programs affected by this final rule are 14.855 and 14.85.

List of Subjects in 24 CFR Part 982

Grant programs--housing and community development, Housing, Rent subsidies.

For the reasons described in the preamble, HUD is amending 24 CFR part 982 as follows:

PART 982--SECTION 8 TENANT BASED ASSISTANCE: HOUSING CHOICE VOUCHER PROGRAM

1. The authority citation for 24 CFR part 982 continues to read as follows:

Authority: 42 U.S.C. 1437f and 3535(d).

2. Revise Sec. 982.305(a)(5) to read as follows:

Sec. 982.305 PHA approval of assisted tenancy.

  (a) * * *

  (5) At the time a family initially receives tenant-based assistance for occupancy of a dwelling unit, and where the gross rent of the unit exceeds the applicable payment standard for the family, the family share does not exceed 40 percent of the family's monthly adjusted income. * * * * *

3. Revise Sec. 982.508 to read as follows:

Sec. 982.508 Maximum family share at initial occupancy.

At the time the PHA approves a tenancy for initial occupancy of a dwelling unit by a family with tenant-based assistance under the program, and where the gross rent of the unit exceeds the applicable payment standard for the family, the family share must not exceed 40 percent of the family's adjusted monthly income. The determination of adjusted monthly income must be based on verification information received by the PHA no earlier than 60 days before the PHA issues a voucher to the family.

Dated: October 28, 1999. Harold Lucas, Assistant Secretary for Public and Indian Housing.

FR Doc. 99-28790Filed11-1-99; 8:51 amBILLING CODE 4210-33-U

---