Notice PIH 208-01 (HA): Guidance Issued Regarding Small Area Fair Market Rent Rule

Date Published: 
January 26th, 2018

On January 17, 2018, HUD issued guidance “to help PHAs better understand their options” under the Final Rule but cautioned that HUD would likely “amend and extend this guidance once it has received and evaluated the complete results of the Small Area FMR Demonstration Evaluation.” Consistent with previous direction from HUD, the guidance states that full implementation and compliance is expected “no later than April 1, 2018.”

We have identified a number of issues with the guidance and plan to address these issues with HUD:

  • Section (4)(d)(ii) – HUD has committed to issuing a separate notice addressing procedures for which designated and opt-in SAFMR PHAs may request approval for exception payment standards exceeding 110% of SAFMR. When will this notice be issued?
  • Section (4)(e) – HUD has stated that a “PHA’s Administrative Plan must indicate how it will handle decreases in the payment standard” during the term of a HAP contract and has identified three policies PHAs to address such decreases. This raises timing concerns for PHAs, as formal PHA administrative plan review processes required to implement such changes may delay adoption of such changes past the April 1, 2018 compliance deadline.
  • Section (6) – HUD has exempted MTW PHAs in mandatory SAFMR areas provided “that agency has an alternate payment standards policy in its HUD-approved Annual MTW Plan.” However, HUD referred to “alternate rent policies” in the Final Rule when it addressed exempting MTW PHAs. Is this a substantive change or is HUD using “alternate rent policies” and “alternate payment standards” interchangeably?
  • Section (9)(b) – HUD has advised that PHAs may request either a suspension or a temporary exemption from SAFMRs by submitting a request to, HUD has not clarified what PHAs are required to do while the suspension/exemption request is pending; nor has HUD established review and approval timeframes for such requests.
  • Section (9)(c) – HUD has provided a nonexclusive list of adverse rental housing market conditions to support a suspension/exemption request. However, HUD has not provided sufficient guidance on the type of documentation PHAs will be required to include in such requests.

Please advise if you have other issues or questions you would like for us to address with HUD as well.

Update on comments submitted through January 11, 2018 re: Docket No. FR-6070-N-01, Notice of Suspension of Small Area Fair Market Rent (Small Area FMR) Designations

In total, 47 comments were submitted (48 separate submissions with 1 duplicate). Comments in support of HUD’s suspension of the Final Rule were submitted by 4 PHAs and 7 trade/industry groups, including CLPHA. More than 50% of the comments submitted were by advocacy groups, civil rights groups, housing mobility entities, and academia all in opposition to HUD’s suspension.

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