04-5395. Operating Fund Program; Establishment of Negotiated Rulemaking Committee and Notice of First Meeting

AGENCY:

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

ACTION:

Establishment of negotiated rulemaking advisory committee and first meeting.

SUMMARY:

HUD announces the establishment of a negotiated rulemaking advisory committee under the Federal Advisory Committee Act and the Negotiated Rulemaking Act of 1990. The purpose of the committee is to provide advice and recommendations on developing a rule for effectuating changes to the Public Housing Operating Fund Program in response to the Harvard University Graduate School of Design's “Public Housing Operating Cost Study.” The Consolidated Appropriations Act, 2004 requires publication of a final rule developed under the Negotiated Rulemaking Act of 1990, by July 1, 2004. The committee consists of representatives with an interest in the outcome of the changes. This document announces the committee members and the dates, location, and agenda for the first committee meeting.

DATES:

The first committee meeting will be held on March 30-April 1, 2004. On each day, the meeting will start at approximately 8:30 a.m. and run until approximately 5 p.m., unless the committee agrees otherwise.

ADDRESSES:

The first committee meeting will take place at the HUD Headquarters Building (Basement Rooms 176, 178, and 180), 451 Seventh Street, SW., Washington, DC 20410. Committee members and the public are to enter the HUD Headquarters Building through the entrance at the corner of Seventh and D Streets, SW. (the North entrance). Committee members and the public should arrive early to ensure timely access to the building. A photo ID is required.

FOR FURTHER INFORMATION CONTACT:

Chris Kubacki, Director, Funding and Financial Management Division, Public and Indian Housing—Real Estate Assessment Center, Suite 800, Department of Housing and Urban Development, 1280 Maryland Ave., SW., Washington, DC 20024-2135; telephone [phone] (this telephone number is not toll-free). Individuals with speech or hearing impairments may access this number through TTY by calling the toll-free Federal Information Relay Service at 1-800-877-8339.

SUPPLEMENTARY INFORMATION:

I. Statutory Background

HUD currently uses a formula approach called the Operating Fund Formula to distribute operating subsidies to public housing agencies (PHAs). A regulatory description of the Operating Fund Formula can be found at 24 CFR part 990. The Operating Fund Formula regulations were developed through negotiated rulemaking procedures. Negotiated rulemaking for an Operating Fund Formula was initiated in March 1999, and resulted in a proposed rule, published on July 10, 2000 (65 FR 42488), which was followed by an interim rule published on March 29, 2001 (66 FR 17276). The March 29, 2001, interim rule established the Operating Fund Formula that is currently in effect.

Generally, the amount of subsidy received by a PHA is the difference between an “allowable expense level” and projected rental income. Each PHA calculates its Operating Fund Formula eligibility annually and submits a request for funding as part of its budget process. The amount of subsidy can vary from one year to the next as a result of the annual appropriations process and accounts for approximately 57 percent of a PHA's total operating revenue, the balance coming from rents and other sources (e.g., fees). For fiscal year 2003, HUD distributed over $3.34 billion in operating subsidies to PHAs.

On January 28, 2004 (69 FR 4212), HUD published a document announcing its intent to establish an advisory committee to provide advice and recommendations on developing a rule for effectuating changes to the Operating Fund Program in response to the Harvard University Graduate School of Design's “Public Housing Operating Cost Study” (Harvard Cost Study). A correction to the document was published on February 6, 2004 (69 FR 5796), which corrected an error in the list of proposed committee members. During the negotiated rulemaking for the Operating Fund Formula, Congress in the Conference Report (H. Rept. 106-379, October 13, 1999) accompanying HUD's Fiscal Year (FY) 2000 Appropriation Act (Pub. L. 106-74, approved October 20, 1999) directed HUD to contract with the Harvard University Graduate School of Design (Harvard GSD) to conduct a study on the costs incurred in operating well-run public housing. Harvard GSD issued a final report, the Harvard Cost Study, on June 6, 2003. In Section 222 of the Consolidated Appropriations Act, 2004 (Pub. L. 108-199, approved January 23, 2004), Congress directed the Secretary to conduct negotiated rulemaking with the publication of a final rule by July 1, 2004. HUD's January 28, 2004, document: (1) Advised the public of HUD's intent to establish the negotiated rulemaking committee; (2) solicited public comments on the proposed membership of the committee; and (3) explained how persons could be nominated for membership on the committee.

II. HUD's Negotiated Rulemaking Advisory Committee on the Operating Fund Program

This document announces HUD's establishment of the Negotiated Rulemaking Advisory Committee on the Operating Fund Program. The purpose of the committee is to provide advice and recommendations on developing a rule for effectuating changes to the Public Housing Operating Fund Program in response to the Harvard Cost Study. As noted above, the January 28, 2004, document tentatively identified a list of possible interests and parties to be represented on the negotiated rulemaking committee, and requested public comment on the proposed committee membership. The public comment period on the January 28, 2004, document closed on February 27, 2004. HUD received 30 comments on the document, including comments from PHAs, PHA associations, nonprofit organizations, and other interested parties. After careful consideration of all the comments received on the January 28, 2004, document HUD has revised the proposed list of committee members by adding the following members to the committee:

• Meade County Housing and Redevelopment Commission, Sturgis, SD.
• Veronica Sledge, President of Resident Advisory Board and President of Victory Point RMC, Jacksonville, FL.

The final list of committee members includes representatives of PHAs, PHA organizations, tenant groups, other interested parties, and HUD. HUD believes the group as a whole represents a proper balance of interests that are willing and able to work within a consensus framework on the new Operating Fund Program. The PHA representatives on the committee have been selected to reflect the diversity of PHAs in terms of size, location, and special circumstances.

The final list of members for the Negotiated Rulemaking Advisory Committee on the Operating Fund Program is as follows:

• Housing Agencies

1. Atlanta Housing Authority, Atlanta, GA

2. New York City Housing Authority, NYC, NY

3. Puerto Rico Housing Authority, San Juan, PR

4. Chicago Housing Authority, Chicago, IL

5. Dallas Housing Authority, Dallas, TX

6. Anne Arundel Housing Authority, Anne Arundel, MD

7. Indianapolis Housing Authority, Indianapolis, IN

8. Albany Housing Authority, Albany, NY

9. Jackson Housing Authority, Jackson, MS

10. Boise City/Ada County Housing Authority, Boise City, ID

11. Reno Housing Authority, Reno, NV

12. Alameda County Housing Authority, Hayward, CA

13. Athens Housing Authority, Athens, GA

14. Housing Authority of East Baton Rouge, Baton Rouge, LA

15. Housing Authority of the City of Montgomery, Montgomery, AL

16. Meade County Housing and Redevelopment Commission, Sturgis, SD

• Tenant Organizations

1. Jack Cooper, Massachusetts Union of Public Housing Tenants, Boston, MA

• Public Housing Tenant

1. Veronica Sledge, President of Resident Advisory Board and President of Victory Point RMC, Jacksonville, FL

• Other Interests/Policy Groups

1. Ned Epstein, Housing Partners, Inc.

2. Howard Husock, Director of Kennedy School Case Program

3. Greg Byrne, Project Director for Harvard Cost Study

4. Dan Anderson, Bank of America

5. David Land, Lindsey and Company

6. Council of Large Public Housing Agencies

7. National Association of Housing and Redevelopment Officials

8. Public Housing Authorities Directors Association

9. National Organization of African Americans in Housing

• Federal Government

1. Assistant Secretary Michael Liu, U.S. Department of Housing and Urban Development

2. Deputy Assistant Secretary William Russell, U.S. Department of Housing and Urban Development

III. First Committee Meeting

The first meeting of the Negotiated Rulemaking Committee on the Operating Fund Program will be held on March 30, March 31, and April 1, 2004. On each day, the meeting will start at approximately 8:30 a.m. and run until approximately 5 p.m., unless the committee agrees otherwise. On all three days, the meetings will take place at the HUD Headquarters Building (Basement Rooms 176, 178, and 180), 451 Seventh Street SW., Washington, DC 20410. The agenda planned for the meeting includes: (1) Orienting members to the negotiated rulemaking process; (2) establishing a basic set of understandings and ground rules (protocols) regarding the process that will be followed in seeking a consensus; and (3) discussion of the issues relating to the development of changes in response to the Harvard Cost Study.

The meeting will be open to the public without advance registration. Public attendance may be limited to the space available. Members of the public may make statements during the meeting, to the extent time permits, and file written statements with the committee for its consideration. Written statements should be submitted to the address listed in the FOR FURTHER INFORMATION CONTACT section of this document. Summaries of committee meetings will be available for public inspection and copying at the address in the same section.

IV. Future Committee Meetings

A second meeting is scheduled for April 13-15, 2004, at the same location. Each day of the April meeting is tentatively scheduled to begin at approximately 8:30 a.m. and run until 5 p.m., unless the committee agrees otherwise. Notices of all future meetings will be published in the Federal Register. HUD will make every effort to publish such notices at least 15 calendar days prior to each meeting.

Dated: March 4, 2004.

Paula O. Blunt,

General Deputy Assistant Secretary for Public and Indian Housing.