Chapter 2. Policy and Procedure Development

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Chapter 2.Policy and Procedure Development
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Chapter 2. Section 1.Introduction

• Learning Objective
• Develop well-conceived policies and effective
  procedures, taking into account mandatory
  requirements and prohibitions and areas of policy
  discretion

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Introduction

• The objectives of this session are to
• Distinguish between mandatory and discretionary
  policy requirements
• Analyze language in regulations to determine what
  decisions have to be made and included in written
  policy and/or procedures to ensure consistency in
  rent determinations

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Introduction

• The quality control study published by HUD PDR
  Office says
• Weaknesses in PHA policies and procedures
  contribute to rent errors.
• Areas of PHA discretion enable PHAs to adapt the
  program to local conditions good!
• BUT also create the potential for confusion and
  inconsistency not so good.

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Introduction

• The challenges for PHAs are to
• Understand what is mandatory and what is
  discretionary
• Develop compliant policies and procedures for
  mandatory items
• Develop reasonable policies in the discretionary
  areas

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Introduction

• The challenges for PHAs are to
• Develop procedures that translate the mandatory
  and discretionary policies into action
• Communicate (and train) policies and procedures
  to ensure consistency
• Monitor policies and procedures to ensure they
  are being complied with by staff

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Introduction

• To help you meet your challenges, well
• Focus on distinction between mandatory vs.
  discretionary policies
• Show you how lack of policies and procedures may
  be contributing to errors
• Help you think through how your agency handles
  discretionary items
• Suggest ways for improving your policies and
  procedures

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Chapter 2. Section 2.The Need for Policies and
Procedures
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Why Policies and Procedures Are Needed

• HUD requires written policies
• Policies are set forth in PHA Admission and
  Continued Occupancy Policy (ACOP)
• Regulatory References
• 24 CFR 903 PH Agency Plans
• 24 CFR 960.202 Tenant Selection Policies
• 24 CFR 960.257 Family Income and Composition
• 24 CFR 966 PH Lease and Grievance Procedures
• 24 CFR 966.5 Posting of Policies, Rules and
  Regulations

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Why Policies and Procedures Are Needed

• Daily guidance to staff in the performance of
  routine activities
• Make decisions more transparent to staff and the
  public
• Are more defensible than unwritten policies when
  challenged
• Ensure that everyone does things the same way
  (consistency, fairness, minimize litigation)

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Why Policies and Procedures Are Needed

• Provide a foundation for sound management and
  supervision
• Approved policies and procedures allow
  supervisors to establish objective performance
  standards for staff
• Provide a basis for auditor justification (RIM,
  IPA, others)

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Mandatory vs. Discretionary Policies and
Procedures

• Mandatory Policy or Procedure Required by
  current law, regulation, notice or handbook
• Discretionary Policy or Procedure Decisions made
  within legal and regulatory limits
• Clarifying regulations when needed without
  changing their intent
• Providing guidance and direction in areas on
  which HUD is silent (example fraud detection)
• Following a HUD requirement with one or more
  discretionary components

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Effect on RIM Reviews

• Many errors result from lack of guidance to staff
• During a RIM review, if there is no HUD rule
  that must be followed, the reviewer will look to
  see
• What policy and/or procedure the PHA has
  established
• Whether that policy/procedure is being followed
• If there is no policy or procedure and practice
  is inconsistent, the reviewer will note this as a
  finding

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Effect on RIM Reviews

• Inconsistency in operation can often be resolved
  by providing
• Consistent written policies and procedures
• Staff training
• Quality control follow-up

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Mandatory and Optional References

• The following references are binding
• Statutes
• HUD Regulations
• PH 24 CFR 960 and 966 and 24 CFR 5
• Current notices
• Most PIH notices have an expiration date
• PIH notices may be extended or reinstated
• HUD Handbooks
• Forms required by HUD regulations (such as 50058)
• OGC Opinions or Rulings

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Mandatory and Optional References

• For issues not covered by mandatory references,
  HUD recommends using these when developing
  policies and procedures
• Guidebooks (reliance on it is safe harbor)
• If statements in guidebook are based on
  regulation, they are not optional
• Notices that have expired (unless changed by
  mandatory reference)
• Handbooks that have expired (unless changed by
  mandatory reference)
• Recommendations from individual HUD staff not
  based on regulatory requirements

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HUD Guidance as Safe Harbor

• For issues not covered by mandatory references,
  HUD recommends that PHAs develop policies and
  procedures based on HUD guidance (creates safe
  harbor)
• If alternative approach is used, PHAs must make
  their own determination of consistency with
  requirements and are not protected by the safe
  harbor concept.

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HUD and PHA Roles

• The role of the HUD field office staff is to
• Inform PHAs about what is mandatory and provide
  appropriate references
• Inform PHAs as to what is optional or
  discretionary
• Ensure that polices and procedures have been
  adopted and implemented

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HUD and PHA Roles

• The role of the PHA is to
• Develop policies and procedures to clarify
  requirements
• Ensure consistency by all staff in the
  application of HUD regulations and PHA policies
  and procedures

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Chapter 2. Section 3.Developing Policies and
Procedures
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Policies vs. Procedures

• Policies
• Expand upon and explain rules
• State what will be done whether it is a HUD
  requirement or a matter of PHA discretion
• Include the performance standards necessary to
  meet requirements
• Must be incorporated into a PHAs ACOP
• Must be formally approved by a PHAs Board
• Must be readily available to public and staff

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Policies vs. Procedures

• Procedures
• Explain how HUD regulations or PHA policies will
  be carried out (the steps or tasks required for
  implementation)
• Include the instructions needed to evaluate
  whether performance standards have been met
• May be recorded where and how a PHA chooses
• Do not require Board approval
• Are easier to change than policies

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Policies vs. Procedures

• Both policies and procedures must
• Comply with current HUD rules and other federal,
  state, and local requirements
• Be reasonable and practical (balance simplicity
  and best practices)
• Provide guidance and tools for implementation, as
  well as rules
• Be in a format that is easy to update and is
  accessible by staff.

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Policies vs. Procedures

• Policies without procedures result in
  inconsistent practices

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Step 1 Identifying Decision Points

• The first step in the process of policy and
  procedure development is identifying decision
  points.
• Decision points are the questions your PHA must
  answer in order to administer your program in
  compliance with HUD regulations.

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HUD Regulations

• Child Care Example
• Two HUD regulations address this deduction (page
  2-11)

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Child Care Decision Points

• Page 2-11
• Child care expenses. Amounts anticipated to be
  paid by the family for the care of children under
  13 years of age during the period for which
  annual income is computed, but only where such
  care is necessary to enable a family member to
  actively seek employment, be gainfully employed,
  or to further his or her education and only to
  the extent such amounts are not reimbursed. The
  amount deducted shall reflect reasonable charges
  for child care. In the case of child care
  necessary to permit employment, the amount
  deducted shall not exceed the amount of
  employment income that is included in annual
  income.

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HUD Interpretation of Child Care Expenses

• A PHA may not disallow a deduction for child care
  expenses because there is an unemployed adult
  family member who may be available to provide the
  care.
• A PHA may not decide who will provide child care
  for an applicants or a tenants child(ren).

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HUD Interpretation of Child Care Expenses

• A PHA may not decide the type of child care
  available for a tenants child(ren).
• Citation Verification Guidebook

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Decision Points

• To develop policies and procedures for
  implementing the child care expense deduction,
  your PHA must first identify the decision points
  in the HUD regulations and guidance.

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Point 1 Necessary to . . . enable a family
member to (engage in a qualifying activity)

• In determining whether the child care is
  necessary, the PHA should compare the hours
  during which child care is provided to the hours
  family members are working or engaging in one of
  the other qualifying activities.

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Point 2 Enable a family member to actively seek
employment

• PHA decision points
• What does actively mean?
• What kinds of activities constitute seeking?
• How often do those activities have to occur
  (performance standard)?
• How will you document actively seeking?
• Can more than one member be actively seeking
  employment?

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Point 3 Enable a family member to be
gainfully employed

• When more than one family member works, the PHA
  must determine which family member(s) are being
  enabled to work by the child care
• Notice that the definition of child care expenses
  limits the amount that may be allowed for these
  expenses to the amount of employment income that
  is included in annual income
• PHA policy may assume that the child care
  expenses enable the lowest paid individual to
  work, unless this is obviously not the case . . .

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Point 4 Enable a family member to further
his/her education

• PHA must verify that the family member enabled to
  further his/her education is actually enrolled in
  and attending an educational institution or
  program.
• The days and times childcare provided must
  correspond to days and hours of school attendance.

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Point 5 Such amounts are not reimbursed

• This means that no one else must be paying for
  the child care expenses either directly or
  indirectly.
• PHA needs to require the family to sign a
  certification of non-reimbursement (may be
  included on application/reexamination form).
• PHA must also obtain certification from the child
  care provider on a 3rd party verification form.

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Point 6 Reasonable charges

• What is your PHAs standard for reasonable?
• PH Occupancy Guidebook says PHAs must determine
  whether child care costs are "reasonable".
• Reasonable means reasonable for the care being
  provided. (in-home vs. day care center or
  elsewhere)
• Remember Families may choose the type of care
  to be provided.

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Point 6 Reasonable charges

• The PHAs policy should define reasonableness as
  it pertains to child care expense.
• For example, the policy could include the
  requirement to conduct some type of market survey
  to determine the rate of childcare under
  comparable conditions within the local market.

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Step 2 Translating Requirements into Policies
and Procedures

• Policies state
• The requirement to be evaluated
• (see examples in book page 2-14)
• The performance standard for the requirement
• (see examples in book page 2-14)
• Procedures focus on the required steps to perform
  the function
• (see examples in book page 2-14)

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Step 2 Translating Requirements into Policies
and Procedures

• See Translating Requirements into Policies and
  Procedures Example in course materials
• Page 2-15

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Step 2 Translating Requirements into Policies
and Procedures

• Learning Activity 2-1 Page 2-17
• Minimum Rent Policies and Procedures
• Criteria for Hardship Exemption
• 5 minutes

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Developing Procedures

• There is no HUD-required form or format, but
  procedures must be consistent with HUD
  requirements.
• PHAs can develop procedures based upon the
  specific work flow at their own agencies.

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Developing Procedures

• Elements of a good procedure
• Explanation of (or citation for) policy
• Task(s) that need to be done
• Staff who is/are responsible
• Time frames that must be observed
• Forms and/or systems that will be used
• Approvals that are necessary
• Instructions for decisions and calculations that
  must be made by staff

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Developing Procedures

• See Excerpt from ABC PHA Minimum Rent Procedure
  (page 2-21)

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Chapter 2. Section 4.Guidelines for
ImplementingPolicies and Procedures
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What Should the PHA Do?

• Review HUD requirements
• Regulations
• Current notices
• Remember that Guidebooks are not mandatory but
  are helpful references for acceptable policy
  language
• Establish local policies and procedures
• Train staff
• Monitor staff for consistency
• When questions arise, make decisions and add to
  already-established policy and procedures

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Charts for Sample Policy Decisions

• Annual Income and Assets
• Income Exclusions
• Medical Expenses
• Child Care Expenses
• Note These are examples only not intended to be
  all inclusive

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Learning Objective

• Develop well-conceived policies and effective
  procedures, taking into account mandatory
  requirements and prohibitions and areas of policy
  discretion