2011-8597. Changes to the Public Housing Assessment System (PHAS): Management Operations Scoring Notice

AGENCY:

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

ACTION:

Notice; correction.

SUMMARY:

HUD published a document in the Federal Register of February 23, 2011, concerning request for public comments on the Management Operations interim scoring notice. The document inadvertently omitted a word with respect to the tenant accounts receivable metric.

DATES:

Effective Date: March 25, 2011.

FOR FURTHER INFORMATION CONTACT:

Claudia Yarus, Department of Housing and Urban Development, Office of Public and Indian Housing, Real Estate Assessment Center (REAC), 550 12th Street, SW., Suite 100, Washington, DC 20410 at 202-475-8830 (this is not a toll-free number). Persons with hearing or speech impairments may access this number through TTY by calling the toll-free Federal Information Relay Service at 800-877-8339. Additional information is available from the REAC Internet site at http://www.hud.gov/​offices/​reac/​.

SUPPLEMENTARY INFORMATION:

I. Background

The proposed management operations scoring information was published on August 21, 2008 (73 FR 49575). This proposal included a metric for tenant rents collected, in which the highest score would have been given for a successful collection rate of 97 percent of the total rent due; the intermediate score would have been given for a successful collection rate of at least 93 percent but less than 97 percent; and the lowest score would have been given for a collection rate of less than 93 percent. Stated in terms of accounts receivable, these 3 tiers of scoring would be: for the highest score, a 3 percent or .03 ratio of accounts receivable; for the intermediate score, at least 7 percent or .07 ratio of accounts receivable to less than a 3 percent or .03 ratio of accounts receivable; and for the lowest score, less than a 7 percent or .07 ratio of accounts receivable.

The interim Management Operations Scoring Notice was published on February 23, 2011 (76 FR 10050). This interim notice is effective as of March 25, 2011, and HUD is accepting public comments on this notice until April 25, 2011. In this interim notice, the same metric is stated as “tenant accounts receivable” and was intended to be adjusted slightly compared to the proposal.

The interim notice states that “A PHA will receive 5 points if it has a tenant accounts receivable ratio of less than 1.5. It will receive 2 points if it has a tenant accounts receivable ratio of equal to or greater than 1.5 and less than 2.5. It will receive zero points if it has a tenant accounts receivable ratio of equal to or greater than 2.5.” (See 76 FR 10051, 3rd column). A chart immediately following this text restates the same figures. Both the paragraph and the chart inadvertently omitted the word “percent” following each of these ratios.

Taken literally on a one-year basis, a tenant accounts receivable ratio of, for example, 1.5 would mean that one-and-one half times the amount of total tenant charges (rents and other charges to the tenants) by a housing authority would be uncollected, an obvious impossibility, or, alternatively, over a 2-year basis, a PHA had failed to collect 100 percent of all tenant charges in a given year, and was still owed 50 percent of all the tenant charges from a previous year, a performance so unlikely as to be virtually impossible, and one having no reasonable relation to the proposal.

HUD submits that the language supports that it was not HUD's intention to give a high score in this metric to such a low-performing PHA even if one existed. What was meant was that 1.5 percent (or .015) of the tenant charges would be uncollected. Stated in the terms that the proposed rule used, PHAS would require PHAs to collect 98.5 percent of the rents rather than 97 percent to receive the highest score, a reasonable adjustment from the proposal. This correction properly conforms the language to the clearly intended meaning.

II. Correction

In the Federal Register of February 23, 2011, in FR Doc. 2011-2658, on page 10051, in the third column, the second full paragraph (beginning “A PHA will receive 5 points if * * * ”) and the subsequent chart should be corrected to add the word “percent” after the figures “1.5” and “2.5” wherever those figures occur, to read as follows:

A PHA will receive 5 points if it has a tenant accounts receivable ratio of less than 1.5 percent. It will receive 2 points if it has a tenant accounts receivable ratio of equal to or greater than 1.5 percent and less than 2.5 percent. It will receive zero points if it has a tenant accounts receivable ratio of equal to or greater than 2.5 percent.

Tenant accounts receivable value	Points
<1.5 percent	5
≥1.5 percent but <2.5 percent	2
≥2.5 percent	0

Dated: April 5, 2011.

Sandra B. Henriquez,

Assistant Secretary for Public and Indian Housing.