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Revisions to SEMAP Lease-Up Indicator
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[Federal Register: October 1, 2001 (Volume 66, Number 190)]
[Rules and Regulations]
[Page 50003-50006]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01oc01-22]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 985
[Docket No. FR-4604-I-01]
RIN 2577-AC21
Revisions to SEMAP Lease-Up Indicator
AGENCY: Office of the Assistant Secretary for Public and Indian
Housing, HUD.
ACTION: Interim rule.
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SUMMARY: This interim rule revises the way HUD measures and verifies
performance under the lease-up indicator for the Section 8 Management
Assessment Program (SEMAP). Specifically, the interim rule revises the
lease-up standard to measure the number of units leased against the
number of units reserved and under Annual Contributions Contract (ACC),
instead of against the number of units budgeted. This revised standard
is consistent with established HUD policy on voucher renewals and unit
allocations as formulated during negotiated rulemaking pursuant to the
Quality Housing and Work Responsibility Act of 1998. In addition, this
interim rule also revises the SEMAP regulations to provide for
automated signature of the required SEMAP certification.
DATES: Effective Date: October 31, 2001. Comments Due Date: November
30, 2001.
ADDRESSES: Interested persons are invited to submit comments regarding
this interim rule to the Regulations Division, Office of General
Counsel, Room 10276, Department of Housing and Urban Development, 451
Seventh Street, SW, Washington, DC 20410-0500. Communications should
refer to the above docket number and title. Facsimile (FAX) comments
are not acceptable. A copy of each communication submitted will be
available for public inspection and copying between 7:30 a.m. and 5:30
p.m. weekdays at the above address.
FOR FURTHER INFORMATION CONTACT: Gerald Benoit, Director, Real Estate
and Housing Performance Division, Office of Public and Assisted Housing
Delivery, Office of Public and Indian Housing, Room 4210, 451 Seventh
Street, SW, Room 4210, Washington, DC 20410; telephone: (202) 708-0477
(this is not a toll-free number). Persons with hearing or speech-
impairments may access this number via TTY by calling the toll-free
Federal Information Relay Service at 1-800-877-8339.
SUPPLEMENTARY INFORMATION:
I. Background
A. The Section 8 Management Assessment Program (SEMAP)
HUD's regulations at 24 CFR part 985 describe the policies and
procedures governing the Section 8 Management Assessment Program
(SEMAP). SEMAP provides for objective measurement of the performance of
a public housing agency (PHA) in key areas of the Section 8 tenant-
based assistance program. SEMAP enables HUD to ensure program integrity
and accountability by identifying PHA management capabilities and
deficiencies and by improving risk assessment to effectively target
monitoring and program assistance. PHAs can use the SEMAP performance
analysis to assess their own program operations.
B. Revisions to the SEMAP ``Lease-Up'' Indicator
Under the current SEMAP regulation at Sec. 985.3(n), HUD determines
the percent of units leased during the last completed PHA fiscal year
by: (1) taking the unit months under Housing Assistance Payments (HAP)
contract as shown on the PHA's latest approved year-end operating
statement divided by 12; and (2) dividing by the number of units
budgeted as shown on the PHA's approved budget for the same PHA fiscal
year. On October 21, 1999 (64 FR 56894), HUD published its final rule
implementing the statutory merger of the Section 8 tenant-based
certificate and voucher programs into a new Housing Choice Voucher
program. (The regulations for the new merged voucher program are
located in 24 CFR part 982.) Due to the replacement of certificate
funding with voucher funding, HUD has found that its data for the
number of units budgeted, as shown on the PHA's approved certificate
and voucher budgets for the last completed PHA fiscal year, often do
not accurately reflect the number of units a PHA reasonably could have
expected to lease during the fiscal year, and so are an inaccurate
denominator for properly determining the lease-up rate. The number of
budgeted units has been found to be unreliable for determining lease-up
principally because HUD did not require that PHAs revise their
certificate budgets downward late in the PHA fiscal year when
certificate funding was replaced with voucher funding. Consequently,
recent certificate program budgets may overstate the number of units
PHAs actually expected to lease.
Due to changes in the method of funding the Section 8 tenant-based
program in 1999 (in particular the replacement of certificate funding
increments with voucher funding), and the resulting changes in
procedures concerning PHA certificate and voucher budgets, the current
SEMAP lease-up standard and HUD's verification method for lease-up is
no longer workable. Accordingly, HUD is issuing this interim rule,
which revises the way HUD measures and verifies performance under the
SEMAP lease-up indicator.
This interim rule provides that a PHA's performance under the SEMAP
indicator will be measured by: (1) taking the unit months under HAP
contract, as shown on the PHA's last year-end operating statement
recorded in HUDCAPS (the HUD accounting system); and (2) dividing by
the number of unit months available for leasing, based on the number of
reserved units for which HUD has obligated funding under Annual
Contributions Contract (ACC), and adjusted to exclude funding
increments obligated during the last PHA fiscal year and not available
for leasing for the entire PHA fiscal year and any units for
litigation. In the event a PHA has not leased the percent of units
needed to attain the points specified for the SEMAP lease-up rating due
to escalating housing assistance payments and insufficient allocated
budget authority to support that percent of lease-up, HUD will
consider, alternatively, whether the PHA has expended that percent of
allocated budget authority.
The method of verification of lease-up described in this interim
rule is consistent with the policy established in HUD's October 21,
1999 (64 FR 56882) final rule for the renewal of expiring ACCs in the
tenant-based Section 8 programs, and in HUD's April 19, 2000 (65 FR
21088) Federal Register notice on unit allocations, which requires that
PHAs assist the number of families that equals the number of units
under ACC with the PHA. Elsewhere in today's Federal Register, HUD is
also publishing an amendment to the April 19, 2000 notice, to ensure a
single consistent standard for lease-up of voucher assistance.
C. Signature of SEMAP Certification
This interim rule also amends Sec. 985.101(a)(1) to remove the
requirement that the SEMAP certification must be signed by the board of
commissioners chairperson or by the chief executive officer of the unit
of government. HUD is presently automating the SEMAP certification form
for submission by PHAs via the Internet. As a result, it has become
impractical to require the signatures of
[[Page 50005]]
the board chairperson and chief executive officer of the unit of
government. Automated signature authorization by the PHA executive
director or, where the PHA is a unit of local government or a state, by
the Section 8 program director, is sufficient.
II. Justification for Interim Rulemaking
It is HUD's policy to publish rules for public comment before their
issuance for effect, in accordance with its own regulations on
rulemaking found at 24 CFR part 10. Part 10 provides, however, that
prior public procedure will be omitted if HUD determines that it is
``impracticable, unnecessary, or contrary to the public interest'' (24
CFR 10.0). HUD finds that in this case prior comment is unnecessary.
This interim rule amends Sec. 985.3(n) only to make a technical
change to the SEMAP lease-up standard and the way HUD will verify a
PHA's performance under the SEMAP lease-up indicator. The change
corrects a method that has become unworkable due to changes in program
policy, procedure and data quality. Further, the new lease-up standard
and verification method described in this interim rule conforms to
established program policy for Section 8 tenant-based program fund and
unit utilization, which were developed with extensive public
participation using negotiated rulemaking procedures. Promulgation of
this interim rule will ensure a single consistent standard for lease-up
of voucher assistance.
Although HUD has determined that it is unnecessary for HUD to
solicit public comment before issuing this rule for effect, HUD is
issuing these amendments on an interim basis and invites public comment
on the interim rule. All public comments will be considered in the
development of the final rule.
III. Findings and Certifications
Environmental Impact
This interim rule does not direct, provide for assistance or loan
and mortgage insurance for, or otherwise govern or regulate, real
property acquisition, disposition, leasing, rehabilitation, alteration,
demolition, or new construction, or establish, revise, or provide for
standards for construction or construction materials, manufactured
housing, or occupancy. Therefore, in accordance with 24 CFR 50.19(c)(1)
of the Department's regulations, this interim rule is categorically
excluded from the requirements of the National Environmental Policy Act
(42 U.S.C. 4321 et seq.).
Regulatory Flexibility Act
The Secretary, in accordance with the Regulatory Flexibility Act (5
U.S.C. 605(b)) (the RFA), has reviewed and approved this interim rule
and in so doing certifies that this rule will not have a significant
economic impact on a substantial number of small entities. The reasons
for HUD's determination are as follows:
(1) A Substantial Number of Small Entities Will Not be Affected.
The interim rule is exclusively concerned with public housing agencies
that administer assistance under section 8 of the United States Housing
Act of 1937. Specifically, the interim rule revises the way HUD
measures and verifies PHA performance under the lease-up indicator for
the Section 8 Management Assessment Program (SEMAP). Under the
definition of ``Small governmental jurisdiction'' in section 601(5) of
the RFA, the provisions of the RFA are applicable only to those few
public housing agencies that are part of a political jurisdiction with
a population of under 50,000 persons. The number of entities
potentially affected by this rule is therefore not substantial
(2) No Significant Economic Impact. The interim regulatory
amendments will 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.
Notwithstanding HUD's determination that this rule will not have a
significant economic effect on a substantial number of small entities,
HUD specifically invites comments regarding any less burdensome
alternatives to this rule that will meet HUD's objectives as described
in this preamble.
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 interim rule would not have
federalism implications and would not impose substantial direct
compliance costs on State and local governments or preempt State law
within the meaning of the Executive Order.
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 on the private sector. This interim rule would not
impose any Federal mandates on any State, local, or tribal governments,
or on the private sector, within the meaning of the Unfunded Mandates
Reform Act of 1995.
Regulatory Planning and Review
The Office of Management and Budget (OMB) reviewed this rule under
Executive Order 12866, Regulatory Planning and Review. OMB determined
that this rule is a ``significant regulatory action'' as defined in
section 3(f) of the Order (although not an economically significant
regulatory action under the Order). Any changes made to this rule as a
result of that review are identified in the docket file, which is
available for public inspection in the office of the Department's Rules
Docket Clerk, Room 10276, 451 Seventh Street, SW., Washington, DC
20410-0500.
Catalog of Federal Domestic Assistance
The Catalog of Federal Domestic Assistance Program numbers
assigned to the Section 8 Management Assessment Program are 14.855
and 14.857.
List of Subjects in 24 CFR Part 985
Grant programs--housing and community development, Housing, Rent
subsidies, Reporting and recordkeeping requirements.
For the reasons described in the preamble, HUD amends 24 CFR part
985 as follows:
PART 985--SECTION 8 MANAGEMENT ASSESSMENT PROGRAM (SEMAP)
1. The authority citation for part 985 continues to read as
follows:
Authority: 42 U.S.C. 1437a, 1437c, 1437f, and 3535(d).
2. Revise Sec. 985.3(n) to read as follows:
Sec. 985.3 Indicators, HUD verification methods and ratings.
* * * * *
(n) Lease-up. (1) This indicator shows whether the PHA enters HAP
contracts for the number of units reserved under ACC for at least one
year.
(2) HUD verification method: (i) Percent of units leased during the
last completed PHA fiscal year as determined by taking unit months
under HAP contract as shown on the PHA's last year-end operating
statement recorded in the HUD accounting system, and dividing by the
number of unit months available for leasing, based on the number of
reserved units for which
[[Page 50006]]
HUD has obligated funding under ACC and adjusted to exclude units
associated with funding increments obligated during the last PHA fiscal
year and units obligated for litigation.
(ii) In the event a PHA has not leased the percent of units needed
to attain the points specified under paragraph (n)(3) of this section
due to escalating housing assistance payments and insufficient
allocated budget authority to support that percent of lease-up, HUD
will consider alternatively, whether the PHA has expended that percent
of allocated budget authority.
(3) Rating: (i) The percent of units leased during the last PHA
fiscal year was 98 percent or more, or the percent of allocated budget
authority expended during the last PHA fiscal year was 98 percent or
more. 20 points.
(ii) The percent of units leased during the last PHA fiscal year
was 95 to 97 percent, or the percent of allocated budget authority
expended during the last PHA fiscal year was 95 to 97 percent. 15
points.
(iii) The percent of units leased during the last PHA fiscal year
was less than 95 percent, and the percent of allocated budget authority
expended during the last PHA fiscal year was less than 95 percent. 0
points.
3. Revise 985.101(a)(1) to read as follows:
Sec. 985.101 SEMAP certification.
(a) * * *
(1) The certification must be approved by PHA board resolution and
signed by the PHA executive director. If the PHA is a unit of local
government or a state, a resolution approving the certification is not
required, and the certification must be executed by the Section 8
program director.
* * * * *
Dated: August 28, 2001.
Mel Martinez,
Secretary.
[FR Doc. 01-24434 Filed 9-28-01; 8:45 am]
BILLING CODE 4210-33-P