[Federal Register Volume 60, Number 185 (Monday, September 25, 1995)]
[Proposed Rules]
[Pages 49480-49485]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-23643]
[[Page 49479]]
_______________________________________________________________________
Part VI
Department of Housing and Urban Development
_______________________________________________________________________
Office of the Assistant Secretary for Public and Indian Housing
_______________________________________________________________________
24 CFR Part 965
Streamlining Public Housing Maintenance and Operation Rules; Proposed
Rule
Federal Register / Vol. 60, No. 185 / Monday, September 25, 1995 /
Proposed Rules
[[Page 49480]]
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Office of the Assistant Secretary for Public and Indian Housing
24 CFR Part 965
[Docket No. FR-3928-P-01]
Streamlining Public Housing Maintenance and Operation Rules
AGENCY: Office of the Assistant Secretary for Public and Indian
Housing, HUD.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would amend regulations on public housing
maintenance and operation to streamline and simplify necessary
requirements and to eliminate unnecessary requirements.
DATES: Comments due date: November 24, 1995.
ADDRESSES: Interested persons are invited to submit comments regarding
this proposed rule to the Rules Docket Clerk, 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: William C. Thorson, Acting Director,
Administration and Maintenance Division, Room 4214, Office of Public
and Indian Housing, Department of Housing and Urban Development, 451
Seventh Street, SW, Washington, DC 20410, telephone (202) 708-4703
(voice). Hearing- or speech-impaired persons may use the
Telecommunications Devices for the Deaf (TDD) by contacting the Federal
Information Relay Service on 1-800-877-TDDY (1-800-877-8339) or (202)
708-9300. (Other than the ``800'' TDD number, telephone numbers are not
toll-free.)
SUPPLEMENTARY INFORMATION:
I. Paperwork Reduction Act Statement
The information collection requirements contained in this proposed
rule have been submitted to the Office of Management and Budget for
review under the Paperwork Reduction Act of 1980 (44 U.S.C. 3501-3520).
The burden on the public associated with the information collections is
described more fully below under the heading, Other Matters. Send
comments regarding this burden estimate or any other aspect of this
information collection to the Rules Docket Clerk, Room 10276,
Department of Housing and Urban Development, 451 Seventh Street, SW,
Washington, DC 20410-0500; and to the Office of Information and
Regulatory Affairs, Office of Management and Budget, Attention: Desk
Officer for HUD, Washington, DC 20503.
II. Background
Upon assuming the leadership of the Department of Housing and Urban
Development (HUD) in 1993, Secretary Cisneros made the reinvention of
HUD one of his first priorities. HUD's reinvention efforts took place
in the context of a broader, government-wide reinvention process, the
National Performance Review, under the leadership of Vice President
Gore. At that time, HUD established five program goals to accomplish
its mission that involved working for healthy growth in cities,
providing adequate housing for all, and protection of society's most
vulnerable people.
HUD determined that one of the first steps needed in its
transformation from the old HUD to a new HUD was the consolidation and
streamlining of funding programs. HUD recently submitted to Congress
sweeping changes to transform public housing to a resident-based
program.
Another aspect of the reinvention involve HUD's rules, which have
been at the forefront of HUD's reinvention efforts since those efforts
commenced in 1993. The foundation of HUD's regulatory process is
Executive Order 12866 (Regulatory Planning and Review) issued by
President Clinton on September 30, 1993. This order directs agencies
to, among other things, explore regulatory alternatives and, if
regulations are determined to be necessary, to select approaches that
maximize benefits and involve enhanced public accessibility and
participation in the rulemaking process.
HUD has done a comprehensive review of 24 CFR Part 965, PHA-Owned
or Leased Projects--Maintenance and Operation. Part 965 contains 8
subparts, covering a wide range of topics. Based on its comprehensive
review, HUD has determined that one subpart can be eliminated; three
subparts can be revised and simplified; two subparts that are
applicable to other housing programs can be consolidated and relocated
to a new ``general'' part that will be applicable to all programs; one
subpart will have to be revised to reflect new statutory requirements;
and one subpart recently issued will be unchanged.
III. Proposed Changes
Subpart A, Preemption of State Prevailing Wage Rates, makes higher
State determined prevailing wage rates ``inapplicable'' to a contract
for PHA-performed work. The ``inapplicability'' of these higher State
rates represents cost savings to public housing agencies (PHAs)
permitting limited resources to go further in addressing much needed
maintenance. For this reason, HUD does not propose to revise this
requirement. At the same time, there are similar requirements in the
development regulations, 24 CFR part 941, and in the modernization
regulations, 24 CFR part 968. HUD plans to consolidate these
requirements in a single regulation in another rulemaking.
Subpart B, Required Insurance Coverage, was codified for the first
time on October 5, 1993. It provides policies concerning insurance
coverage required under the Annual Contributions Contract when provided
by a qualified PHA-Owned insurance entity, pursuant to the HUD
Appropriations Act of 1992. A comprehensive review of this subpart
indicates that its provisions are the minimum necessary to implement
the statutory provisions. No further simplification or streamlining is
necessary, except to remove a cross-reference to a provision of the
Annual Contributions Contract (ACC), since a new, completely revised
ACC with different numbering of the provisions is now being adopted.
Three subparts of this part have a bearing on the Federal
government's utility costs associated with the public housing program.
Subpart C, Energy Audits and Energy Conservation Measures, deals with a
subject that is critical to the long term success, viability and
livability of public housing. Conducting energy audits and installation
of energy conservation measures has a significant financial impact for
both PHAs and the Department. Approximately $1.5 billion is spent on
public housing utility costs annually, most of which is paid by the
Federal government. As a result, the current requirement to conduct
energy audits and install cost effective energy conservation measures
is judicious. At the same time, HUD's review of this subpart reveals
that it can be simplified. In revising the text of this subpart, HUD
gave consideration to the final rule published in the Federal Register
on April 10, 1995 regarding Indian Housing Program Amendments, 24 CFR
Parts 905 and 950 (60 FR 18174, 18268). HUD's
[[Page 49481]]
Office of Native American Programs reduced the size and scope of the
comparable portion of its rule (now 24 CFR 950.805 through 950.825) to
a reasonable level that still ensures that energy conservation is
appropriately addressed. Accordingly, this subpart is proposed to be
revised in substantially the same manner as part 950.
A second subpart of this part that has an effect on utility costs
is subpart D, Individual Metering of Utilities for Existing PHA-Owned
Projects. Public housing agencies spend over $1 billion each year for
utility costs, a substantial portion of which is funded by Federal
operating subsidies. It is appropriate that HUD require PHAs to take
reasonable steps to reduce these utility costs. One significant step is
determining the extent to which it is cost effective to individually
meter projects and require residents to pay utility costs directly, as
is currently required by subpart D. Because of its impact on the cost
of public housing to the Federal government, HUD is retaining this
requirement in substantially its current form. HUD does believe that
some streamlining is possible. The revised language is consistent with
the new Indian Programs rule at Secs. 950.840 through 950.850. (See 60
FR 18268-18269.)
HUD is proposing to eliminate the purpose and definitions sections
because they are self-evident. This rule also proposes to eliminate
much of the technical language now contained in Sec. 965.404. The
language of the current Sec. 965.407 concerning PHA consultation with
resident organizations, which is advisory only, is revised to reflect
the Department's intent that it be mandatory.
The third subpart with an impact on utility costs is subpart E,
Tenant Allowances for Utilities. To the extent individual metering or
checkmetering is determined cost effective, it is necessary for a PHA
to establish resident allowances for utilities. The current subpart E
provides a broad framework and allows PHAs the flexibility to determine
the appropriate allowances. This philosophy is consistent with the
principles of the reinvention of government. As a result, HUD will
retain subpart E substantially in its current form. However, HUD
believes that some streamlining is possible. Revisions similar to those
made in the new Indian Programs rule at Secs. 950.860 through 950.876
(60 FR 18269-18270) have been made to eliminate the much of the
purpose, applicability, definitions and other unnecessary language.
Subpart F, Modernization of Oil-Fired Heating Plants, was issued in
1980 to implement a statutory set-aside of $25 million to modernize
oil-fired heating equipment. This subpart is now obsolete and is
proposed to be removed.
HUD plans to consolidate Subpart H, Lead-Based Paint Poisoning
Prevention, with similar provisions for other HUD programs. However,
that change will be made in a separate rule.
Subpart I, Fire Safety, will be revised in a separate rule that
updates provisions throughout HUD rules that deal with this subject.
[HUD published amendments to a number of assisted housing rules on July
30, 1992, to ensure that residents are protected from fire hazards. On
October 26, 1992, Congress passed the Fire Administration Authorization
Act of 1992 (Pub. L. 102-522), which prohibits the use of housing
assistance in connection with certain assisted and insured properties,
unless various fire protection and safety standards are met. The fire
protection and safety standards prescribed by the statute add
requirements beyond those contained in this subpart.]
IV. Other Matters
Environmental Impact
A Finding of No Significant Impact with respect to the environment
has been made in accordance with HUD regulations at 24 CFR part 50,
which implements section 102(2)(C) of the National Environmental Policy
Act of 1969 (NEPA). This Finding 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 the General Counsel, Department of Housing and
Urban Development, Room 10276, 451 Seventh Street, SW., Washington, DC
20410-0500.
Impact on Small Entities
The Secretary, in accordance with the Regulatory Flexibility Act (5
U.S.C. 605(b)), has reviewed and approved this proposed rule, and, in
so doing, certifies that the proposed rule would not have a significant
economic impact on a substantial number of small entities. This
proposed rule streamlines and reduces the existing administrative
burden on PHAs, regardless of whether the recipient is categorized as a
large entity or a small entity.
Federalism Impact
The General Counsel, as the Designated Official under section 6(a)
of Executive Order No. 12611, Federalism, has determined that this
proposed rule will not have a substantial, direct effect on the States
or on the relationship between the Federal government and the States,
or on the distribution of power or responsibilities among the various
levels of government. The proposed rule does not effect the autonomy of
local PHAs. Instead, it streamlines and eliminates requirements
currently in effect.
Impact on the Family
The General Counsel, as the Designated Official under Executive
Order 12606, The Family, has determined that the proposed rule will not
have a significant impact on family formation, maintenance, and well-
being, and, therefore, is not subject to review under the Order.
Catalog
The Catalog of Federal Domestic Assistance numbers for the public
housing program is 14.850.
Public Reporting Burden
The public reporting burden for the information collections
contained in this proposed rule are shown in a chart below. These
estimates include the time for reviewing the instructions, searching
existing data sources, gathering and maintaining the data needed, and
completing and reviewing the collection of information.
[[Page 49482]]
Tabulation of Annual Reporting Burden--Proposed Rule Streamlining Public Housing Maintenance and Operations
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No. of
Section of No. of responses Total ann. Hrs. per
Description of info. coll. 24 CFR respondents per responses response Total hours
affected respondent
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Energy audits every 5 years....... 965.302 3,400 1/5 700 2 1,400
Review of energy contracting soli-
citations and contracts.......... 965.308 10 1 10 8 80
Benefit/cost analysis............. 965.402 1,360 1/3 454 2 908
Review of util. allowances........ 965.507 1,924 1 1,924 2 3,848
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Total Annual Burden
(Reduction from current
burden of 1,764 hours)..... ........... ........... ........... ........... ........... 6,236
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List of Subjects in 24 CFR Part 965
Grant programs--housing and community development, Housing, Loan
programs--housing and community requirements, Small businesses.
Accordingly, 24 CFR part 965, is proposed to be amended as follows:
PART 965--PHA-OWNED OR LEASED PROJECTS--MAINTENANCE AND OPERATION
1. The authority citation for part 965 continues to read as
follows:
Authority: 42 U.S.C. 1437, 1437a, 1437d, 1437g, 3535(d). Subpart
H is also issued under 42 U.S.C. 4821-4846.
Sec. 965.205 [Amended]
2. In subpart B, Sec. 965.205 is amended by removing the phrase
``(in section 305 of the ACC)'' from the first sentence in paragraph
(a).
Secs. 965.303, 965.309, 965.310, 965.315 [Removed]
3. In subpart C, Secs. 965.301, 965.302, and 965.304 through
965.308 are revised, and Secs. 965.303, 965.309, 965.310, and 965.315
are removed, to read as follows:
Subpart C--Energy Audits and Energy Conservation Measures
Sec. 965.301 Purpose and applicability.
(a) Purpose. The purpose of this subpart is to implement HUD
policies in support of national energy conservation goals by requiring
PHAs to conduct energy audits and undertake certain cost-effective
energy conservation measures.
(b) Applicability. The provisions of this subpart apply to all PHAs
with PHA-owned housing, but they do not apply to Indian Housing
Authorities. (For similar provisions applicable to Indian housing, see
part 950 of this chapter.) No PHA-leased project or Section 8 Housing
Assistance Payments Program project, including PHA-owned Section 8
projects, is covered by this subpart.
Sec. 965.302 Requirements for energy audits.
All PHAs shall complete an energy audit for each PHA-owned project
under management, not less than once every five years. Standards for
energy audits shall be equivalent to State standards for energy audits
or as approved by HUD. Energy audits shall analyze all of the energy
conservation measures, and the payback period for these measures, that
are pertinent to the type of buildings and equipment operated by the
PHA.
Sec. 965.304 Order of funding.
Within the funds available to a PHA, energy conservation measures
should be accomplished with the shortest pay-back periods funded first.
A PHA may make adjustments to this funding order because of
insufficient funds to accomplish high-cost energy conservation measures
(ECM), or a situation in which an ECM with a longer pay-back period can
be more efficiently installed in conjunction with other planned
modernization. A PHA may not install individual utility meters that
measure the energy or fuel used for space heating in dwelling units
that need substantial weatherization, when installation of meters would
result in economic hardship for residents. In these cases, the ECMs
related to weatherization shall be accomplished before the installation
of individual utility meters.
Sec. 965.305 Funding.
(a) The cost of accomplishing cost-effective energy conservation
measures, including the cost of performing energy audits, shall be
funded from operating funds of the PHA to the extent feasible. When
sufficient operating funds are not available for this purpose, such
costs are eligible for inclusion in a modernization program, for
funding from any available development funds in the case of projects
still in development, or for other available funds that HUD may
designate to be used for energy conservation.
(b) If an PHA finances energy conservation measures from sources
other than modernization or operating reserves, such as on the basis of
a promise to repay, HUD may agree to provide adjustments in its
calculation of the PHA's operating subsidy eligibility under the PFS
for the project and utility involved if the financing arrangement is
cost-beneficial to HUD. (See Sec. 990.107(g) of this chapter.)
Sec. 965.306 Energy conservation equipment and practices.
In purchasing original or, when needed, replacement equipment, PHAs
shall acquire only equipment that meets or exceeds the minimum
efficiency requirements established by the U.S. Department of Energy.
In the operation of their facilities, PHAs shall follow operating
practices directed to maximum energy conservation.
Sec. 965.307 Compliance schedule.
All energy conservation measures determined by energy audits to be
cost effective shall be accomplished as funds are available.
Sec. 965.308 Energy performance contracts.
(a) Method of procurement. Energy performance contracting shall be
conducted using one of the following methods of procurement:
(1) Competitive proposals (see 24 CFR 85.36(d)(3)). In identifying
the evaluation factors and their relative importance, as required by
Sec. 85.36 (d)(3)(i) of this title, the solicitation shall state that
technical factors are significantly more important than price (of the
energy audit); or
(2) If the services are available only from a single source,
noncompetitive proposals (see 24 CFR 85.36 (d)(4)(i)(A)).
(b) HUD Review. Solicitations for energy performance contracting
shall be submitted to the HUD Field Office for review and approval
prior to issuance.
[[Page 49483]]
Energy performance contracts shall be submitted to the HUD Field Office
for review and approval before award.
Secs. 965.408, 965.409, 965.410 [Removed]
4. In subpart D, Secs. 965.401 through 965.407 are revised, and
Secs. 965.408, 965.409, and 965.410 are removed, to read as follows:
Subpart D--Individual Metering of Utilities for Existing PHA-Owned
Projects
Sec. 965.401 Individually metered utilities.
(a) All utility service shall be individually metered to residents,
either through provision of retail service to the residents by the
utility supplier or through the use of checkmeters, unless:
(1) Individual metering is impractical, such as in the case of a
central heating system in an apartment building;
(2) Change from a mastermetering system to individual meters would
not be financially justified based upon a benefit/cost analysis; or
(3) Checkmetering is not permissible under State or local law, or
under the policies of the particular utility supplier or public service
commission.
(b) If checkmetering is not permissible, retail service shall be
considered. Where checkmetering is permissible, the type of individual
metering offering the most savings to the PHA shall be selected.
Sec. 965.402 Benefit/cost analysis.
(a) A benefit/cost analysis shall be made to determine whether a
change from a mastermetering system to individual meters will be cost
effective, except as otherwise provided in Sec. 965.405.
(b) Proposed installation of checkmeters shall be justified on the
basis that the cost of debt service (interest and amortization) of the
estimated installation costs plus the operating costs of the
checkmeters will be more than offset by reduction in future utilities
expenditures to the PHA under the mastermeter system.
(c) Proposed conversion to retail service shall be justified on the
basis of net savings to the PHA. This determination involves making a
comparison between the reduction in utility expense obtained through
eliminating the expense to the PHA for PHA-supplied utilities and the
resultant allowance for resident-supplied utilities, based on the cost
of utility service to the residents after conversion.
Sec. 965.403 Funding.
The cost to change mastermeter systems to individual metering of
resident consumption, including the costs of benefit/cost analysis and
complete installation of checkmeters, shall be funded from operating
funds of the PHA to the extent feasible. When sufficient operating
funds are not available for this purpose, such costs are eligible for
inclusion in a modernization project or for funding from any available
development funds.
Sec. 965.404 Order of conversion.
Conversions to individually metered utility service shall be
accomplished in the following order when a PHA has projects of two or
more of the designated categories, unless the PHA has a justifiable
reason to do otherwise, which shall be documented in its files.
(a) In projects for which retail service is provided by the utility
supplier and the PHA is paying all the individual utility bills, no
benefit/cost analysis is necessary, and residents shall be billed
directly after the PHA adopts revised payment schedules providing
appropriate allowances for resident-supplied utilities.
(b) In projects for which checkmeters have been installed but are
not being utilized as the basis for determining utility charges to the
residents, no benefit/cost analysis is necessary. The checkmeters shall
be used as the basis for utility charges and residents shall be
surcharged for excess utility use.
(c) Projects for which meter loops have been installed for
utilization of checkmeters shall be analyzed both for the installation
of checkmeters and for conversion to retail service.
(d) Low- or medium-rise family units with a mastermeter system
should be analyzed for both checkmetering and conversion to retail
service, because of their large potential for energy savings.
(e) Low- or medium-rise housing for elderly should next be analyzed
for both checkmetering and conversion to retail service, since the
potential for energy saving is less than for family units.
(f) Electric service under mastermeters for high-rise buildings,
including projects for the elderly, should be analyzed for both use of
retail service and of checkmeters.
Sec. 965.405 Actions affecting residents.
(a) Before making any conversion to retail service, the PHA shall
adopt revised payment schedules, providing appropriate allowances for
the resident-supplied utilities resulting from the conversion.
(b) Before implementing any modifications to utility services
arrangements with the residents or charges with respect thereto, the
requisite changes shall be made in resident dwelling leases in
accordance with 24 CFR part 966.
(c) PHAs must work closely with resident organizations, to the
extent practicable, in making plans for conversion of utility service
to individual metering, explaining the national policy objectives of
energy conservation, the changes in charges and rent structure that
will result, and the goals of achieving an equitable structure that
will be advantageous to residents who conserve energy.
(d) A transition period of at least six months shall be provided in
the case of initiation of checkmeters, during which residents will be
advised of the charges but during which no surcharge will be made based
on the readings. This trial period will afford residents ample notice
of the effects the checkmetering system will have on their individual
utility charges and also afford a test period for the adequacy of the
utility allowances established.
(e) During and after the transition period, PHAs shall advise and
assist residents with high utility consumption on methods for reducing
their usage. This advice and assistance may include counseling,
installation of new energy conserving equipment or appliances, and
corrective maintenance.
Sec. 965.406 Benefit/cost analysis for similar projects.
PHAs with more than one project of similar design and utilities
service may prepare a benefit/cost analysis for a representative
project. A finding that a change in metering is not cost effective for
the representative project is sufficient reason for the PHA not to
perform a benefit/cost analysis on the remaining similar projects.
Sec. 965.407 Reevaluations of mastermeter systems.
Because of changes in the cost of utility services and the periodic
changes in utility regulations, PHAs with mastermeter systems are
required to reevaluate mastermeter systems without checkmeters by
making benefit/cost analyses at least every 36 months. These analyses
may be omitted under the conditions specified in Sec. 965.406.
5. Subpart E is revised to read as follows:
Subpart E--Resident Allowances for Utilities
Sec.
965.501 Applicability.
965.502 Establishment of utility allowances by PHAs.
965.503 Categories for establishment of allowances.
965.504 Period for which allowances are established.
[[Page 49484]]
965.505 Standards for allowances for utilities.
965.506 Surcharges for excess consumption of PHA-furnished
utilities.
965.507 Review and revision of allowances.
965.508 Individual relief.
Subpart E--Resident Allowances for Utilities
Sec. 965.501 Applicability.
(a) This subpart applies to public housing, including Turnkey III
Homeownership Opportunities program. This subpart also applies to units
assisted under sections 10(c) and 23 of the U. S. Housing Act of 1937
as in effect before amendment by the Housing and Community Development
Act of 1974 and to which 24 CFR part 900 is not applicable. This
subpart does not apply to Indian housing projects (see 24 CFR part
950).
(b) In rental units for which utilities are furnished by the PHA
but there are no checkmeters to measure the actual utilities
consumption of the individual units, residents shall be subject to
charges for consumption of resident-owned major appliances, or for
optional functions of PHA-furnished equipment, in accordance with
Sec. 965.502(e) and 965.506(b), but no utility allowance will be
established.
Sec. 965.502 Establishment of utility allowances by PHAs.
(a) PHAs shall establish allowances for PHA-furnished utilities for
all checkmetered utilities and allowances for resident-purchased
utilities for all utilities purchased directly by residents from the
utilities suppliers.
(b) The PHA shall maintain a record that documents the basis on
which allowances and scheduled surcharges, and revisions thereof, are
established and revised. Such record shall be available for inspection
by residents.
(c) The PHA shall give notice to all residents of proposed
allowances, scheduled surcharges, and revisions thereof. Such notice
shall be given, in the manner provided in the lease or homebuyer
agreement, not less than 60 days before the proposed effective date of
the allowances or scheduled surcharges or revisions; shall describe
with reasonable particularity the basis for determination of the
allowances, scheduled surcharges, or revisions, including a statement
of the specific items of equipment and function whose utility
consumption requirements were included in determining the amounts of
the allowances or scheduled surcharges; shall notify residents of the
place where the PHA's record maintained in accordance with paragraph
(b) of this section is available for inspection; and shall provide all
residents an opportunity to submit written comments during a period
expiring not less than 30 days before the proposed effective date of
the allowances or scheduled surcharges or revisions. Such written
comments shall be retained by the PHA and shall be available for
inspection by residents.
(d) Schedules of allowances and scheduled surcharges shall not be
subject to approval by HUD before becoming effective, but will be
reviewed in the course of audits or reviews of PHA operations.
(e) The PHA's determinations of allowances, scheduled surcharges,
and revisions thereof shall be final and valid unless found to be
arbitrary, capricious, an abuse of discretion, or otherwise not in
accordance with the law.
Sec. 965.503 Categories for establishment of allowances.
Separate allowances shall be established for each utility and for
each category of dwelling units determined by the PHA to be reasonably
comparable as to factors affecting utility usage. The PHA will
establish allowances for different size units, in terms of numbers of
bedrooms. Other categories may be established at the discretion of the
PHA.
Sec. 965.504 Period for which allowances are established.
(a) PHA-furnished utilities. Allowances will normally be
established on a quarterly basis; however, residents may be surcharged
on a monthly basis. The allowances established may provide for seasonal
variations.
(b) Resident-purchased utilities. Monthly allowances shall be
established at a uniform monthly amount based on an average monthly
utility requirement for a year; however, if the utility supplier does
not offer residents a uniform payment plan, the allowances established
may provide for seasonal variations.
Sec. 965.505 Standards for allowances for utilities.
(a) The objective of a PHA in designing methods of establishing
utility allowances for each dwelling unit category and unit size shall
be to approximate a reasonable consumption of utilities by an energy-
conservative household of modest circumstances consistent with the
requirements of a safe, sanitary, and healthful living environment.
(b) Allowances for both PHA-furnished and resident-purchased
utilities shall be designed to include such reasonable consumption for
major equipment or for utility functions furnished by the PHA for all
residents (e.g., heating furnace, hot water heater), for essential
equipment whether or not furnished by the PHA (e.g., range and
refrigerator), and for minor items of equipment (such as toasters and
radios) furnished by residents.
(c) The complexity and elaborateness of the methods chosen by the
PHA, in its discretion, to achieve the foregoing objective will depend
upon the data available to the PHA and the extent of the administrative
resources reasonably available to the PHA to be devoted to the
collection of such data, the formulation of methods of calculation, and
actual calculation and monitoring of the allowances.
(d) In establishing allowances, the PHA shall take into account
relevant factors affecting consumption requirements, including:
(1) The equipment and functions intended to be covered by the
allowance for which the utility will be used. For instance, natural gas
may be used for cooking, heating domestic water, or space heating, or
any combination of the three.
(2) The climatic location of the housing projects.
(3) The size of the dwelling units and the number of occupants per
dwelling unit.
(4) Type of construction and design of the housing project.
(5) The energy efficiency of PHA-supplied appliances and equipment.
(6) The utility consumption requirements of appliances and
equipment whose reasonable consumption is intended to be covered by the
total resident payment.
(7) The physical condition, including insulation and
weatherization, of the housing project.
(8) Temperature levels intended to be maintained in the unit during
the day and at night, and in cold and warm weather.
(9) Temperature of domestic hot water.
(e) If a PHA installs air conditioning, it shall provide, to the
maximum extent economically feasible, systems that give residents the
option of choosing to use air conditioning in their units. The design
of systems that offer each resident the option to choose air
conditioning shall include retail meters or checkmeters and residents
shall pay for the energy used in its operation. For systems that offer
residents the option to choose air conditioning, the PHA shall not
include air conditioning in the utility allowances. For systems that
offer residents the option to choose air conditioning but can not be
checkmetered, residents are to be
[[Page 49485]]
surcharged in accordance with Sec. 965.506. If an air condition system
does not provide for resident option, residents are not to be charged
and these systems should be avoided whenever possible.
Sec. 965.506 Surcharges for excess consumption of PHA-furnished
utilities.
(a) For dwelling units subject to allowances for PHA-furnished
utilities where checkmeters have been installed, the PHA shall
establish surcharges for utility consumption in excess of the
allowances. Surcharges may be computed on a straight per unit of
purchase basis (e.g., cents per kilowatt hour of electricity) or for
stated blocks of excess consumption, and shall be based on the PHA's
average utility rate. The basis for calculating such surcharges shall
be described in the PHA's schedule of allowances. Changes in the dollar
amounts of surcharges based directly on changes in the PHA's average
utility rate shall not be subject to the advance notice requirements of
this section.
(b) For dwelling units served by PHA-furnished utilities where
checkmeters have not been installed, the PHA shall establish schedules
of surcharges indicating additional dollar amounts residents will be
required to pay by reason of estimated utility consumption attributable
to resident-owned major appliances or to optional functions of PHA-
furnished equipment. Such surcharge schedules shall state the resident-
owned equipment (or functions of PHA-furnished equipment) for which
surcharges shall be made and the amounts of such charges, which shall
be based on the cost to the PHA of the utility consumption estimated to
be attributable to reasonable usage of such equipment.
Sec. 965.507 Review and revision of allowances.
(a) Annual review. The PHA shall review at least annually the basis
on which utility allowances have been established and, if reasonably
required in order to continue adherence to the standards stated in
Sec. 965.505 shall establish revised allowances. The review shall
include all changes in circumstances (including completion of
modernization and/or other energy conservation measures implemented by
the PHA) indicating probability of a significant change in reasonable
consumption requirements and changes in utility rates.
(b) Revision as a result of rate changes. The PHA may revise its
allowances for resident-purchased utilities between annual reviews if
there is a rate change (including fuel adjustments) and shall be
required to do so if such change, by itself or together with prior rate
changes not adjusted for, results in a change of 10 percent or more
from the rates on which such allowances were based. Adjustments to
resident payments as a result of such changes shall be retroactive to
the first day of the month following the month in which the last rate
change taken into account in such revision became effective.
Sec. 965.508 Individual relief.
Requests for relief from surcharges for excess consumption of PHA-
purchased utilities, or from payment of utility supplier billings in
excess of the allowances for resident-purchased utilities, may be
granted by the PHA on reasonable grounds, such as special needs of
elderly, ill or disabled residents, or special factors affecting
utility usage not within the control of the resident, as the PHA shall
deem appropriate. The PHA's criteria for granting such relief, and
procedures for requesting such relief, shall be adopted at the time the
PHA adopts the methods and procedures for determining utility
allowances. Notice of the availability of such procedures (including
identification of the PHA representative with whom initial contact may
be made by residents), and the PHA's criteria for granting such relief,
shall be included in each notice to residents given in accordance with
Sec. 965.502(c) and in the information given to new residents upon
admission.
Dated: August 24, 1995.
MaryAnn Russ,
Director, Office of Assisted Housing.
[FR Doc. 95-23643 Filed 9-22-95; 8:45 am]
BILLING CODE 4210-33-P
