Calculation and Submission of Operating Subsidy Training


1
Calculation and Submission of Operating Subsidy
Training

• June July and August 2006
• Forms HUD-52722 and
• HUD-52723

2
Training Modules

• Module 1 Introduction
• Module 2 Unit and Unit Months
• Module 3 UEL (Utility Expense Level)
• Module 4 Other Formula Expenses (Add-ons)
• Module 5 Formula Income
• Module 6 Transition Policy/Completion of Form
• Module 7 Deleted Units and Asset Repositioning
  Fee
• Module 8 New Units

3
Module 1 Introduction

• Calculation and Submission of Operating Subsidy
  Training

4
Training Objectives

• Understand Final Operating Fund Formula (the
  Formula)
• Complete Revised HUD-52722 and HUD-52723 Forms
• Emphasize Complex Parts of Formula and Forms

5
Historical Background

• Quality Housing and Work Responsibility Act of
  1998 (QHWRA)
• Negotiated Rulemaking 1999
• Harvard Cost Study
• Negotiated Rulemaking 2004
• Revision of 24 CFR Part 990 (the Rule)

6
Reference Materials

• Final Rule (Sep. 19 2005)
• PIH 2005-34 (Nov. 2 2005) General Information
• FR-5016-N-02 (Jan. 5 2006) Calculation of PEL
• PIH 2006-10 (Feb. 3 2006) Guidelines to
  Identify AMPs
• PIH 2006-14 (Mar. 22 2006) Transition
  Calculation and Asset Management Compliance

7
Consequences of Final Rule

• Project-Based Funding
• Direct funding of asset management properties
• Project-Based Budgeting and Accounting
• Training in the Fall
• Asset Management
• Primer Webcast Available

8
Funding Shift PHA to Property

• FY 2006 PHA-Level Funding
• Interim Funding Formula (AEL)
• FY 2007 PHA-Level Funding
• Final Funding Formula (WAPEL)
• FY 2008 Property-Level Funding
• Final Funding Formula (PEL)

9
Funding Method ComparisonInterim Rule
Operating Fund
Public Housing Authority
10
Funding Method ComparisonFinal Rule
Operating Fund
AMPs
Public Housing Authority
11
Revised Funding Forms for FY 2007 Funding

• HUD-52723 Operating Fund Calculation of
  Operating Subsidy
• HUD-52722 Operating Fund Calculation of
  Utilities Expense Level

12
Eliminated Funding Forms

• HUD-52722a Calculation of Allowable Utilities
  Expense
• HUD-52722b Adjustment for Utility Consumption
  and Rates
• HUD-52720a Formula Data Collection
• HUD-52720b Calculation of Formula and Delta
• HUD-52720c Range Test and Determination of Base
  Year Expense Level
• HUD-52728 HA Calculation of Occupancy Percentage
  for a Requested Budget Year (RBY)

13
Other Required Forms

• SF-424 Application for Federal Assistance
• HUD-50071 Certification of Payments to Influence
  Federal Transactions

14
Operating Fund Submission Timeline
15
Types of Revisions

• PHA Error
• New/Deleted Units
• Transition/Stop Loss
• Extenuating Circumstances

16
Final Operating Subsidy Formula Major
Components

• EUM Eligible Unit Months
• PEL Project Expense Level
• UEL Utility Expense Level
• Add-ons Non PEL/UEL expenses
• Formula Income Rental Income
• k

17
Operating Subsidy FormulaInterim Rule

• Operating Subsidy
• (AEL UEL) x UMA Add-ons
• minus
• Formula Income x UMA

18
Operating Subsidy FormulaFinal Rule

• Operating Subsidy
• (PEL UEL) x EUM Add-ons
• minus
• Formula Income x EUM

19
Operating Subsidy FormulaRelationships

• PEL

Subsidy
20
Operating Subsidy FormulaRelationships

• EUM

Subsidy
21
Operating Subsidy FormulaRelationships

• UEL

Subsidy
22
Operating Subsidy FormulaRelationships

• Add-ons

Subsidy
23
Operating Subsidy FormulaRelationships

• Income

Subsidy
24
HUD-52723 Format

• Hard Copy Submission
• Signed copy
• Mailed to HUD
• Excel Tool
• Auto-populated data
• Auto-calculation
• Submitted electronically
• Provides Historical Data

25
Form HUD-52723 Section 1

• Name and Address/ACC Number/DUNS
• Auto-populated in Excel Tool
• Please Verify Information

26
Form HUD-52723 Section 1

• Type of Submission Original vs. Revision
• Original submission due Sept. 15 2006
• Final Revision Due July 15 2007

27
Form HUD-52723 Section 1

• Funding Period
• Funding Period Not Linked to PHA FYE
• FY 2007 01/01/2007 to 12/31/2007

28
Form HUD-52723 Section 1

• PHA Fiscal Year End
• Not in Operating Fund Calculation - Data
  Purposes Only

29
Form HUD-52723 Section 1

• Operating Fund Project Number
• Use existing PHA Project Number

30
Section 3 Part A Lines 01 through 04

• In FY 2007 PEL will be replaced by WAPEL

31
WAPEL

• Weighted Average PEL
• FY 2007 Only
• Weighted by Asset Management Property Units
• Form HUD-52723 will not change for FY 2007

32
Section 3 Line 01 PUM Project Expense Level

• Calculation Method 990.165
• FY 2006 PEL (WAPEL)
• Provided by HUD

33
Line 02 - Inflation Factor

• Weighted Average Local Government Wages and
  Non-Wage Expenses
• Provided by HUD

34
Line 03 PUM Inflated PEL

• FY 2007 PEL (WAPEL)
• Calculated Automatically

35
Line 04 PEL

• PUM PEL x EUM
• Calculated Automatically

36
Module 2 Units and Unit Months

• Calculation and Submission of Operating Subsidy
  Training

37
Funding Period

• January 1 to December 31 of a given year
• Example For FFY 2007 it is Jan. 1 2007 to Dec.
  31 2007
• All PHAs will be funded for the same period
  regardless of PHA fiscal year end

38
Reporting Period

• 12-month period from July 1 to June 30
• Ends six months prior to the first day of the
  funding period
• Example For FFY 2007 it is Jul 1 2005 to Jun
  30 2006
• Time period used to report unit information

39
Section 2 ACC Units

• ACC Units on 7/1/__ (7/1/05)
• Units Added to ACC
• Units Deleted from ACC
• ACC Units on 6/30/__ (6/30/06)

40
Section 2 Lines 01 through 17
41
ACC Unit Categorization

• Calculate the number of months a unit meets the
  criteria for a particular category
• Two-Step Process
• Identify under which category unit was classified
• Determine number of months unit was classified in
  that category during the reporting period

42
Unit Categorization First or Last Day of Month

• PHA must choose first or last day
• Method must be consistent
• Example Unit was vacant on Jul. 1 2005. Unit
  was approved for special use on Sep. 20 2005.
  PHA uses first day of month.
• Sep. 1 Vacant
• Oct. 1 Special Use

43
Section 2 Column A

• Unit Months
• Includes all ACC units
• Used to determine
• Asset management and IT fee add-ons

44
Section 2 Occupied Unit Categories
45
Section 2 Line 01

• 01 Occupied dwelling units by public housing
  eligible Family
• Occupied by public housing eligible family under
  lease
• Residents meet the income/eligibility
  qualifications for public housing
• 990.140

46
Section 2 Line 02

• 02 Occupied dwelling units by PHA Employees
  police officers
• Occupied by PHA employee police officer or
  other security personnel who is not otherwise
  eligible for public housing
• If these individuals are eligible for public
  housing report on Line 01
• 990.190(e)

47
Section 2 Line 03

• 03 New units
• Eligible to receive subsidy during the funding
  period but not included on Lines 01 02 or 05-13
  of this section
• Discussed during New Units module
• 990.155(a)(1) and (b)(1)

48
Section 2 Line 04

• 04 New units
• Eligible to receive subsidy from 10/1 to 12/31 of
  previous funding period but not included on
  previous Calculation of Operating Subsidy
• Discussed during New Units module
• 990.155(a)(1) and (b)(1)

49
Section 2 Vacant Unit Categories
50
HUD-Approved Vacancies

• Vacancies approved by the HUD field office
• Approval is limited to the time period agreed to
  by the field office
• PHA must request renewal every two years

51
Section 2 Line 05

• 05 Units undergoing modernization
• Two possible scenarios
• Scenario 1 conditions
• Modernization contract awarded or force account
  work started
• Construction on schedule according to
  HUD-approved PHA Annual Plan and
• Unit is vacant to perform work.

52
Section 2 Line 05

• Scenario 2 conditions
• PHA treats unit as undergoing modernization in
  HUD-approved PHA Annual Plan
• Time period for placing unit under construction
  not yet expired and
• Unit is vacant to perform work.
• 990.145(a)(1)

53
Section 2 Line 06

• 06 Special use units
• Resident services
• Resident organization offices
• Related activities such as self-sufficiency and
  anti-crime initiatives
• Eligibility conditions apply
• 990.145(a)(2) and Notice PIH 94-71 (HA)

54
Section 2 Line 07

• 07 Units vacant due to litigation
• Legally enforceable court order or settlement
  agreement
• Regulatory and statutory requirements to avoid
  potential litigation
• Voluntary compliance agreements with HUD or
  acceptable to HUD
• 990.145(b)(1)

55
Section 2 Lines 08 and 09

• 08 Units vacant due to disasters
• Federally-declared state-declared and
  other-declared
• 990.145(b)(2)
• 09 Units vacant due to casualty losses
• Delays in settling insurance claims
• 990.145(b)(3)

56
Section 2 Line 10

• 10 Units vacant due to changing market
  conditions
• External reason for changing market conditions
• PHA has taken aggressive marketing and outreach
  measures
• HUD-approved vacancy through appeal process
• 990.145(c)

57
Section 2 Line 11

• 11 Units vacant and not categorized above
• Vacant
• Available for occupancy
• Not included on Lines 01 through 10 above

58
Section 2 Other ACC Unit Categories
59
Section 2 Line 12

• 12 Units eligible for asset repositioning fee
  and still on ACC (occupied or vacant)
• Discussed during Deleted Units module
• 990.190(h)

60
Section 2 Line 13

• 13 All other ACC units not categorized above
• Not eligible but still on ACC
• Not included on Lines 01 through 12

61
Section 2 Column A Line 15

• Total Unit Months
• Sum of Section 2 Column A
• Lines 01 through 04
• Lines 05 through 11
• Lines 12 through 13

62
Section 2 Column B

• Eligible Unit Months (EUMs)
• Used to determine
• Project Expense Level (PEL)
• Utilities Expense Level (UEL)
• Formula Income

63
Section 2 Line 06a

• 06a Units on Line 02 that are occupied by
  police officers and that also qualify as special
  use units
• Included in eligible unit months (EUMs)
• Special Use Unit

64
Section 2 Line 14

• 14 Limited vacancies
• Used in column B
• PHAs with more than 100 units
• May receive subsidy for vacant units up to 3 of
  total unit months
• Calculation is lesser of
• 3 of Section 2 Column A Line 15 or
• Section 2 Column A Line 11

65
Section 2 Line 14

• 14 Limited vacancies (continued)
• PHAs with 100 or less units
• May receive subsidy for up to five vacant units
• Calculation is lesser of
• 60 unit months or
• Section 2 Column A Line 11
• 990.150

66
Section 2 Column B Line 15

• Total Unit Months (Eligible Unit Months)
• Sum of Section 2 Column B
• Line 1
• Lines 3 through 4
• Lines 5 through 10
• Line 14

67
Section 2 Column C

• Resident Participation Unit Months
• Used to determine funding for resident
  participation activities add-on

68
Section 2 Column C Line 15

• Total Unit Months (Resident Participation Unit
  Months)
• Sum of Section 2 Column C
• Line 1 through 4

69
Section 2 Line 16

• Units eligible for funding for resident
  participation activities
• Total Unit Months 12
• Section 2 Column C Line 16
• Section 2 Column C Line 15 12
• Only in Column C

70
Section 2 Line 17

• Unit months for which the actual consumption is
  included in Line 01 of form HUD-52722 and that
  were removed from Lines 01 through 11 above
  because of removal from inventory including
  eligibility for the asset repositioning fee
• Discussed during Deleted Units module
• Only in Column B

71
Exercise 1a and 1b

• Refer to Units and Unit Months Exercise 1a
  and form HUD-52723 Operating Fund Calculation of
  Operating Subsidy
• Refer to Units and Unit Months Exercise 1b
  and form HUD-52723 Operating Fund Calculation of
  Operating Subsidy

72
Module 3Utilities Expense Level (UEL)

• Calculation and Submission of Operating Subsidy
  Training

73
UEL Summary

• Utility expense level (UEL) is based on
• PHAs consumption of its utilities
• Actual average utility rates for each utility
• Inflation/deflation factor

74
UEL Summary (Continued)

• Sum of consumption of many utilities
• Historical utility data
• Utility consumption incentive
• Same reporting period as HUD-52723

75
Consolidated UEL Forms
76
Section 1 General Information

• Name of Public Housing Agency
• ACC Number
• Operating Fund Project Number
• DUNS Number

77
Section 1 General Information

• Funding Period
• Type of Submission
• Fiscal Year End

78
Section 1 General Information

• Unit Change Indicator
• Frozen Rolling Base
• Rate Reduction Incentive

79
Section 2 Lines 01 and 01a

• 01 Actual consumption
• By type of utility
• For reporting period (7/1/__ to 6/30/__)
• 01a Unit of consumption
• Unit of measurement for each type of utility in
  Line 01

80
Section 3 Lines 02 03 and 04
Jan. 1st minus 18 months
Jan. 1st minus 30 months
Jan. 1st minus 42 months

• 02 03 and 04 Rolling base year 1 2 and 3 -
  actual consumption
• For 12-month period ending June 30th that is 18
  30 and 42 months prior to the first day of the
  funding period

81
Section 3 Line 05

• 05 Total consumption during 3-year rolling base
  period
• Rolling base year 1 Line 02
• Rolling base year 2 Line 03
• Rolling base year 3 Line 04

82
Section 3 Line 06

• 06 Average rolling base consumption
• Total consumption during 3-year rolling base
  Line 05
• 3

83
Section 3 Lines 07 and 08

• 07 Actual consumption for new units
• Only if PHA has added units to ACC
• 08 Rolling base consumption
• Average rolling base consumption Line 06
• Actual consumption for new units Line 07

84
Section 4 Line 09

• 09 Base Consumption
• Lesser of
• Actual Consumption Line 01
• or
• Rolling Base Consumption Line 08

85
Section 5 Line 10

• 10 Actual consumption gt rolling base
• If Actual consumption Line 01
• is greater than
• Rolling base consumption Line 08 enter
  difference as positive
• If not enter zero

86
Section 5 Line 11

• 11 Actual consumption lt rolling base
• If Actual consumption Line 01
• is less than
• Rolling base consumption Line 08 enter
  difference as positive
• If not enter zero

87
Section 5 Line 12

• 12 75/25 Split
• Consumption increased
• Actual consumption gt rolling base Line 10
• x
• 0.25

88
Section 5 Line 13

• 13 75/25 Split
• Consumption decreased
• Actual consumption lt rolling base Line 11
• x
• 0.75

89
Section 6 Line 14

• 14 Annualization of consumption for new units
• Only if PHA added new units to ACC that are
  eligible for subsidy during funding period

90
Section 6 Line 15

• 15 Payable consumption
• Base consumption Line 09
• 75/25 Split Line 12
• 75/25 Split Line 13
• Annualization of consumption for new units
  Line 14

91
Utility Consumption Incentive Example
92
Utility Consumption Incentive Example
93
Section 7 Lines 16 and 17

• 16 Actual utility costs
• For consumption in Line 01
• 17 Actual average utility rate
• Actual average utility costs Line 16
• Actual consumption Line 01

94
Section 8 Lines 18 and 19

• 18 Base utilities expense level
• Payable consumption Line 15
• x
• Actual average utility rate Line 17
• 19 Surcharges for excess consumption

95
Surcharges for Excess Consumption

• PHA collects surcharges from tenants for excess
  utility consumption
• Surcharges are treated as income
• Surcharges are subtracted from base utilities
  expense level resulting in less UEL

96
Section 8 Lines 20 and 21

• 20 Base utilities expense minus surcharges
• Base utilities expense level Line 18
• minus
• Surcharges Line 19
• 21 Utilities inflation/deflation factor

97
Section 9 Line 22

• 22 Utilities expense level adjusted for
  inflation/deflation
• Base utilities expense level Line 20
• x
• Utilities inflation/deflation factor Line 21

98
Section 9 Line 23

• 23 Energy rate incentive
• PHA gets funding for 50 of the rate savings due
  to incentive
• Documentation to support rate savings required

99
Section 9 Line 24

• 24 Utilities expense level whole dollars
• Utilities expense level adjusted for
  inflation/deflation Line 22
• Energy rate incentive Line 23

100
Section 9 Line 25

• 25 Eligible unit months from Form HUD-52723
  Column B
• Total Unit Months Line 15
• Unit months for which actual consumption is
  included in Line 01 of form Line 17
• minus
• New units eligible to receive subsidy from
  10/1 to 12/31 Line 04

101
Section 9 Line 26

• 26 Utilities Expense Level PUM
• Utilities expense level whole dollars
• Line 24
• Eligible unit months Line 25

102
Form HUD-52723 Part A Line 05

• Enter PUM Utilities Expense Level
• on Line 05

103
Avoid Distortion of Rolling Base Consumption Level

• A PHA shall report its rolling base consumption
  so as not to materially distort the rolling base
  period

104
Situations Requiring Adjustments to Avoid
Distortion of the Rolling Base Consumption Level

• Conversion from one utility type to another type
• Switch of utilities from resident-purchased to
  PHA-supplied or vice versa
• Interruptible service
• Unoccupied projects and units

105
Frozen Rolling Base

• PHA freezes rolling base at level prior to energy
  conservation measures
• Rolling base remains frozen for length of energy
  conservation measure contract

106
Frozen Rolling Base (Continued)

• Benefit
• One time consumption decrease will benefit the
  PHA over the length of the contract rather than
  only for three years
• PHA is funded for 100 of consumption savings
  rather than only 75 of consumption savings

107
Frozen Rolling Base (Continued)

• PHA must prepare separate forms for projects and
  utilities involved
• Follow specific frozen rolling base instructions
  on form HUD-52722 pages 6 and 7
• 990.185(1)

108
Exercise 2

• Refer to Utilities Expense Level Exercise 2
  and form HUD-52722 Operating Fund Calculation of
  Utilities Expense Level

109
Module 4 Other Formula Expenses (Add-Ons)

• Calculation and Submission of Operating Subsidy
  Training

110
Section 3 Part A Lines 07 through 15
111
Line 07 Self-sufficiency

• Elderly/Disabled Service Coordinator (EDSC)
  Program only (no other ROSS programs)
• Only applies to 1995 grant recipients
• Based on allowable amount in FY 2004 adjusted
  for inflation

112
Line 07 Self-sufficiency (continued)

• For reasonable cost of salary fringe benefits
  and related administrative costs
• Supporting documentation must be provided in
  Section 4 Remarks
• 990.190(a)

113
Line 08 Energy loan amortization

• Must be HUD-approved
• Includes the following costs accrued during the
  funding period
• Principal and interest for the energy
  conservation measures
• Other direct costs related to the energy project
• 990.185(a)(3)

114
Line 09 Payment in lieu of taxes

• PILOT 10 of shelter rent
• Shelter rent
• Net Tenant Rental Revenue FDS Line 703
• minus
• Utility Costs Financial Data Schedule Lines
  931 932 933 934 935 937 938

115
Line 09 Payment in lieu of taxes (continued)

• PHA receives 10 of shelter rent even if it has
  cooperation agreement with locality to pay less
• If shelter rent is a negative number PHA
  receives 0 for PILOT

116
Line 10 Cost of an independent audit

• Most recent actual audit costs from FDS submitted
  in FASS-PH
• From FDS Line 912 Auditing fees
• Operating Fund portion only

117
Line 10 Cost of an independent audit (continued)

• If PHA does not intend to have audit for the
  period must enter zero
• If PHA intends to have audit for the period but
  has no recent actual audit cost in FASS-PH PHA
  must work with FO to establish audit cost
• If funding for audit is requested audit must be
  completed
• 990.190(d)

118
Line 11 Funding for resident participation
activities

• 25 per unit
• Based on units occupied by
• Public housing resident
• PHA employee police officer or other security
  personnel not otherwise eligible for public
  housing

119
Line 12 Asset management fee

• Based on total ACC unit months
• PHAs with at least 250 units
• 4 per unit month
• PHAs with fewer than 250 units
• Must transition to asset management to receive
  add-on
• 2 per unit month

120
Line 12 Asset management fee (continued)

• Asset management fee
• Total Unit Months
• x
• 2 or 4
• Section 3 Part A Line 12
• Section 2 Column A Line 15
• x
• 2 or 4

121
Line 13 Information technology fee

• Based on total ACC unit months
• 2 per unit month
• Information technology fee
• Total Unit Months
• x
• 2

122
Line 14 Asset repositioning fee

• Discussed in Deleted Units module

123
Line 15 Costs attributable to changes in
Federal law regulation or economy

• No amount permitted at this time
• Bookmark for future use

124
Line 16 Total Add-Ons

• Sum of Part A Lines 07 through 15

Total Add-Ons auto-calculated on Line 16
125
Line 17 Total Formula Expenses

• Sum of Part A Lines 04 06 and 16

Total Formula Expenses auto-calculated on Line 17
126
Exercise 3

• Refer to Other Formula Expenses (Add-Ons)
  Exercise 3 and form HUD-52723 Operating Fund
  Calculation of Operating Subsidy

127
Module 5 Formula Income

• Calculation and Submission of Operating Subsidy
  Training

128
Formula Income Summary

• Formula income is based on
• Rent charged to tenants
• Unit months leased
• Data obtained from PHAs 2004 audited financial
  information in the FDS submitted in FASS-PH

129
Frozen at 2004 Level

• Formula income frozen at 2004 level
• Not recalculated for FFY 2007 through 2009
• Exceptions
• Appeal for severe local economic hardship
• Adjustment for changes in tenant utility
  allowances

130
Line 01 PUM formula income

• Rent charged to tenants 2004
• (from FDS Line 703 Net tenant rental revenue)
• Unit months leased 2004
• (from FDS Line 1121 Number of unit months
  leased)

131
Line 01 PUM formula income

• PUM formula income
• auto-populated by HUD on Line 01

132
Adjustments in Rental IncomeChanges in Tenant
Utility Allowances

• Rent collections and rental income will change as
  tenant utility allowances increase or decrease
• Frozen FY 2004 income level needs to be adjusted
• Exception
• If PHA is HUD-approved to freeze the tenant
  utility allowance base as the result of energy
  conservation measures then the PHA should not
  report the allowance in HUD-52723

133
Changes in Tenant Utility Allowances
Results In

• Tenant Utility Allowances

Rental Income
Operating Subsidy
134
Changes in Tenant Utility Allowances
Results In

• Tenant Utility Allowances

Rental Income
Operating Subsidy
135
Line 02 PUM change in utility allowances
Enter PUM change in utility allowances on Line 02

• Decrease over 2004 entered as positive
• Increase over 2004 entered as negative in
  brackets

136
Calculation of Change in Utility AllowancesStep 1

• PUM Tenant utility allowances 2004
• Tenant utility allowances 2004
• (from PHA records)
• Unit months leased 2004
• (from FDS line 1121 Number of unit months
  leased)

137
Calculation of Change in Utility AllowancesStep 2

• PUM Tenant utility allowances RP
• Tenant utility allowances reporting period
• (from PHA records)
• Unit months leased reporting period
• (from PHA records)

138
Calculation of Change in Utility AllowancesStep 3

• PUM Change in utility allowances
• PUM tenant utility allowances 2004
• (Step 1)
• minus
• PUM tenant utility allowances reporting period
• (Step 2)

139
Line 03 PUM adjusted formula income

• PUM formula income
• (Line 01)
• PUM change in utility allowances
• (Line 02)

140
Line 03 PUM adjusted formula income
PUM adjusted formula income is auto-calculated on
Line 03
141
Line 04 Total Formula Income

• PUM adjusted formula income
• (Section 3 Part B Line 03)
• x
• Total eligible unit months
• (Section 2 Line 15 Column B)

142
Line 04 Total Formula Income
Total Formula Income auto-calculated on Line 04
143
Exercise 4

• Refer to Formula Income Exercise 4 and form
  HUD-52723 Operating Fund Calculation of
  Operating Subsidy

144
Module 6 Transition Policy and Completion of
Form

• Calculation and Submission of Operating Subsidy
  Training

145
Objectives

• Review Transition Schedule/Transition Funding
• Explain Stop Loss Provision
• Finalize HUD-52723 Form

146
Transition Policy

• Subpart F
• Sections 990.220 990.235
• Notice PIH 2006-14
• Detailed guidance on calculation of PUM
  Transition Amount
• Includes seven criteria for asset management
  compliance

147
Transition Funding

• Transition Funding
• Transition Funding is similar to Add-on
• EUM x PUM Transition Amount

148
PUM Transition Amount

• (Final Rule Subsidy Level) - (Interim Rule
  Subsidy Level)
• Use FY 2004 Data for Calculation
• Calculated on a PUM Basis
• Modified Final Rule Formula

149
Transition Schedule - Decliners

• Year 1 - 24 of PUM transition (FFY 2007)
• Year 2 - 43 of PUM transition (FFY 2008)
• Year 3 - 62 of PUM transition (FFY 2009)
• Year 4 - 81 of PUM transition (FFY 2010)
• Year 5 - 100 of PUM transition (FFY 2011) or
  Normal Funding under Final Rule

150
Transition Schedule - Gainers

• Year 1 - 50 of PUM transition (FFY 2007)
• Year 2 - 100 of PUM transition (FFY 2008) or
  Normal Funding under Final Rule

151
Transition Schedule - Decliners Example
152
Transition Schedule - Decliners Example
Will vary year to year.
153
Transition Policy GainersExample
154
Transition Policy GainersExample
Value is negative because the PHAs operating
subsidy is reduced by transition policy.
155
Stop Loss

• Subpart H
• Opportunity to limit funding reduction
• PHAs must be Asset Management Compliant
• Calculation based on PUM transition amount

156
Stop Loss Asset Management Compliance Schedule
157
Stop Loss Example
158
Moving-to-Work (MTW)

• Moving-to-Work (MTW) Part C Line 1
• 990.165

159
Moving-to-Work (MTW) PHAs

• Block Grant PHAs
• Receive an operating subsidy as provided in
  Attachment A of MTW Agreements
• Continue to have the right to request extensions
  of or modifications to MTW Agreements
• 990.165

160
Part DCalculation of Formula Amount

• Formula Calculation
• Part A Part B Part C
• (Formula Expenses) (Formula Income) (Other
  Formula Provisions)

161
Part DCalculation of Formula Amount

• Cost of Independent Audit
• Same as Line 10 in Part A

162
Part D Calculation of Formula Amount

• Formula amount
• Greater of Formula Calculation or Audit

163
Part ECalculation of Operating Subsidy

• Subpart E
• Use of HUD Databases to Calculate Formula
• PHAs Responsibility to Submit Timely Data

164
Part ECalculation of Operating Subsidy

• Formula amount
• Not Necessarily the Subsidy Amount
• Completed by HUD

165
Part ECalculation of Operating Subsidy

• Adjustments due to availability funds
• Based on Proration of Formula Amount
• (Formula Amount) x (Proration )

166
Part ECalculation of Operating Subsidy

• HUD discretionary adjustments
• Will vary by PHA

167
Part ECalculation of Operating Subsidy

• Funds Obligated for Period
• (Formula Amount) (Appropriations Adjustment)
  (HUD Adjustment)

168
Module 7 Deleted Units

• Calculation and Submission of Operating Subsidy
  Training

169
Objectives

• Define Deleted Unit
• Correctly Remove Deleted Unit Data from Reporting
  Period in HUD-52723
• Understand Implications of Deleted Units on
  HUD-52722
• Review Asset Repositioning Fee

170
Definition

• 990.155
• All units in a project or an entire building in a
  project which are eligible for Asset
  Repositioning Fee
• Units removed from ACC without Asset
  Repositioning Fee

171
Asset Repositioning Fee

• 990.190
• Applications for Demolition or Disposition must
  be HUD Approved to receive Asset Repositioning
  Fee
• Supplements Demolition and Disposition Costs
• Asset Repositioning Fee replaces Operating
  Subsidy

172
Asset Repositioning Fee Expenses

• Administration and Management
• Tenant Relocation
• Minimum Protection and Services

173
Asset Repositioning Fee ScheduleDemolition Units

• 75 of PEL for first 12 months
• 50 of PEL for second 12 months
• 25 of PEL for third 12 months

174
Asset Repositioning Fee Schedule Disposition
Units

• 75 of PEL for first 12 months
• 50 of PEL for second 12 months

175
Asset Repositioning Fee Funding

• Continues Despite Actual Expenses
• Continues Despite Actual Disposition or
  Demolition Schedule
• Continues Despite Replacement Vouchers or New ACC
  Units

176
Replacement of Prior Add-ons

• Costs Attributable to Deprogrammed Units
• Phase Down for Demolitions
• Determine Remaining Asset Repositioning Schedule
  as of Jan 1 2007

177
Asset Repositioning Fee Timeline

• Fee begins on the first day of the next quarter
  six months after the date the first unit becomes
  vacant after the relocation date included in the
  approved relocation plan.

178
Asset Repositioning Fee Timeline (continued)

• HUD-approval of demolition or disposition with
  tenant relocation plan
• Date of first vacancy
• Add six months to vacancy date and determine the
  next quarter start date
• Asset repositioning can only begin on 1/1 4/1
  7/1 or 10/1

179
Asset Repositioning Units Impact on HUD-52723

• Units no longer eligible for Operating Subsidy
  due to Asset Repositioning
• Must Delete Data in Reporting Period from Lines
  01 to 11
• Deleted Units Reported on Line 12 - Units
  Eligible for Asset Repositioning Fee

180
Section 2 - Lines 01 through 11
181
Categorization of Unit Months

• Delete Unit Month Data by Categorization
• Use Reporting Period Data
• Delete based on Asset Repositioning Date

182
Asset Repositioning Unit Months

• Line 12 Units eligible for asset repositioning
• Unit months removed from Lines 01 to 11 should be
  reported on Line 12

183
Categorization Chart of Deleted Units
184
How to Identify Unit Month Category

• Crosswalk Alignment of Reporting and Funding
  Period
• Category in Reporting Period Determines Line to
  Remove

185
Asset Repositioning FeeImpact on HUD-52722

• Actual Consumption (Reporting Period)
• Actual Utility Costs (Reporting Period)
• Rolling Base
• Multi-Year Impact

186
HUD-52722 Impacted Line Items
187
Asset Repositioning FeeDeletion of Consumption
Data

• Based on First Vacancy Date after HUD Approved
  Relocation Date
• Scenario 1
• 12 Months of Utility Data in Line 1 Actual
  Consumption
• Scenario 2
• Less than 12 Months of Utility Data in Line 1
  Actual Consumption

188
Deletion of Consumption Data Example

• First unit in a project approved for asset
  repositioning vacated on 1/1/2007
• Unit generated 100 kwh of electricity consumption
  annually
• Unit kwh consumption cost 100 annually

189
Asset Repositioning FeeDeletion of Consumption
Data
Partial Year of Data
Full Year of Data
190
Asset Repositioning FeeDeletion of Consumption
Data
Adjustment
Full Year of Data
191
Special Provision for Calculation of UEL

• Unit Months for which actual consumption is
  included..
• Reinserts deleted units into Eligible Unit Months
  calculation for HUD-52722
• Units reported in Line 17 still include
  consumption data in HUD-52722
• j

192
Other Criteria for Deleted Unit Rolling Base
Adjustment

• Units removed from ACC without Asset
  Repositioning Fee
• Switch from PHA Paid to Tenant Paid Utilities

193
Demolition and Disposition Units Adjustment to
Rolling Base

• If less than 10 of Units in a Building are
  Demolished/Disposed
• No Adjustment to 52722
• If less than 5 Units in a Building are
  Demolished/Dispose
• No Adjustment to 52722
• Consumption data flows through Rolling Base

194
Exercise 5

• Refer to Deleted Units Exercise 5 and forms
  HUD-52723 and HUD-52722

195
Module 8 New Units

• Calculation and Submission of Operating Subsidy
  Training

196
Objectives

• Define New Unit
• Correctly Place New Unit Data on Form HUD-52723
• Understand Implications of New Units on HUD-52722
  (Rolling Base)

197
Definition

• 990.155
• Unit Added to ACC
• Occupied by Eligible Family
• Added During or After Reporting Period

198
New Unit Status

• First Day of Month
• Last Day of Month
• Consistency Same for Both New Units and Unit
  Categorization
• Assumed to be Fully Occupied for Funding Period

199
Impact on HUD-52723

• Eligible Unit Months
• Resident Participation
• Asset Management Fee
• IT Fee
• UEL/PEL/Formula Income

200
Section 2 Lines 01 through 04
201
Impact on Line 01 Occupied Dwelling Units

• Occupied Dwelling Units
• Includes Only Partial Year of New Unit Data
• 0 to 12 Unit Months per Unit

202
Impact on Line 03 New Units

• New Units Eligible in FY 2007
• Eligible for Funding but Not Reported
• Eligible for 0 to 12 Unit Months per Unit

203
Impact on Line 04 New Units

• New Units Eligible in FY 2006
• Not Included in FY 2006 Funding
• Eligible for 0 to 3 Unit Months per Unit

204
New Unit Categories

• Category 1 Units Added During Reporting Period
  (7/1/2005 to 6/30/2006)
• Category 2 Units Added After Reporting Period
  but Before FY 2006 Final Revision (7/1/2006 to
  7/15/2006)
• Category 3 Units Added After Reporting Period
  and After FY 2006 Final Revision in CY 2006
  (7/16/2006 to 12/31/2006)
• Category 4 Units Added in Funding Period
  (1/1/2007 to 7/15/2007)

205
Category 1 Units Added During Reporting Period
206
Category 2 Units After Reporting PeriodPrior
to FY 2006 Final Revision
207
Category 3 Units Added After Reporting Period
and After FY 2006 Final Revision
208
Category 4 Units Added During Funding Period
209
Impact on HUD-52722

• Need to Annualize New Unit Consumption
• Rolling Base Changes
• Multi-Year Impact

210
Impact on HUD-52722New Unit Revisions

• No Changes to HUD-52722 Due to New Unit Revisions
• New Units Added After Reporting Period do not
  require update to UEL Calculation
• UEL is PUM Base Utility Expense Funded through
  EUM Increase

211
Section 1 General Information

• Unit Change Indicator Box

212
HUD-52722 Impacted Line Items
213
Section 2 Current Consumption

• Line 1 Actual Consumption
• Matches Reporting Period (7/1/2005 to 6/30/2006)
• Includes New and Existing Unit Consumption Data

214
Section 3 Rolling Base Consumption

• Line 7 Actual Consumption for New Units
• New Consumption Data is added to Rolling Base

215
Section 6 Payable Consumption

• Line 14 Annualization of Consumption for New
  Units
• Estimates missing new unit consumption data from
  reporting period
• Line 7 Line 14 should equal 12 months of
  consumption

216
HUD-52722 Additional Reporting Requirements

• Consumption Data attached with HUD-52722
• Consumption Estimate Methodology attached with
  HUD-52722

217
Section 3 Rolling Base Consumption

• Does not include New Unit Utility Consumption
  Data

218
Impact on Rolling BaseYear 1 - New Units Added

• No New Unit Consumption Data reported in Rolling
  base
• Use Line 07 Actual Consumption for New Units

219
Impact on Rolling BaseYears 2 to 5 After New
Units Added

• Line 2 (Rolling base year 1) Partial Year Data
• Report zero in rolling base year 1
• Use Line 7 Actual Consumption for New Units
• Line 2 (Rolling base year 1) Full Year Data
• Rolling base year 1 as reported
• Rolling base year 2 or 3 as reported or previous
  rolling base year
• Line 7 equals 0

220
Adjustment of Consumption Data Example

• Unit is added to the ACC and occupied by an
  eligible family on February 1 2006
• Unit consumed 50 kwh of electricity consumption
  during reporting period
• Unit is expected to consume 120 kwh of
  electricity consumption annually

221
Adjustments to HUD-52722New Unit Consumption Data
Partial Year of Data
Full Year of Data
Adjustment
222
Exercise 6

• Refer to New Units Exercise 6 and forms
  HUD-52723 and HUD-52722