Early Draft of HUD Work Requirement and Term Limit Proposed Rule Leaked

On September 29, in an article written by ProPublica, a pre-published copy of a proposed rule titled “Establishing Flexibility for Implementation of Work Requirements and Term Limits” was published. It would allow housing agencies to set work requirements and term limits.

There are two important notes about the proposed rule. First, this draft version would be published as just that—a proposed rule—and not as an interim final rule. This structure allows for comments that HUD must take into account. Second, this is a pre-published version of the rule, and it appears to be HUD’s version. This rule will be sent to OMB for comment and then revised before publication. As such, the exact details of this rule are subject to change drastically, so the following summary is only a high-level summary of the contents of the leaked draft. Once an actual proposed rule is released, NAHRO will publish in-depth analysis.

According to this proposed rule, both term limits and work requirements would be optional, and the rule creates maximum and minimum limits agencies who choose to implement these policies must comply with. In short, the rule would allow PHAs and PBRA owners to implement a work requirement of up to 40 hours per week per individual and a term limit for assisted households not shorter than two years. PHAs and owners can choose to incorporate work requirements, term limits, both, or neither.

The rule would apply to the Public Housing Program, Housing Choice Voucher Program, Project-Based Voucher Program, and Project-Based rental assistance programs. The rule also proposes definitions and indicates policy decisions PHAs must make. Only PHA and PBRA owners in good standing would be allowed to implement work requirements. For both work requirements and term limits, PHAs and owners would be responsible for making all necessary decisions left open to them and then tracking and enforcing those policies without violating federal, state, or local law.

Work Requirements

This rule would incorporate significant flexibilities for PHAs and PBRA owners.

• Generally, this section would apply to “work-eligible adults” between the ages of 18 and 61or a more restrictive definition. The rule would allow for flexibility in determining who would be subject to work requirements, so PHAs could set higher minimum ages than the proposed rule’s minimum of 18 or lower maximum ages that the proposed rule’s 61. It also proposes other exemptions, such as students, those caring for a family member, and other situations.
• PHAs and owners would have the ability to create different requirements for different programs and different projects within the same program. The HUD-VASH program is exempted from this rule, and agencies could exempt other special purpose vouchers as well.
• Policies could not require an individual member of a household to work more than 40 hours per week. The rule does not dictate whether assisted families must work an exact minimum or average number of hours.
• PHAs and owners would also need to stipulate whether the requirement would apply to the family—where a family must work a certain number of hours—or each individual subject to the rule, though each individual person could not be required to work more than 40 hours per week.
• PHAs could also create specific language regarding what counts as a work activity and how they would handle specific circumstances arising from self-employment.
• Like term limits, PHAs would need to add these policies to their plans (and public housing leases, if applicable). They would also need to notify tenants, in compliance with the rule, implement a hardship waiver policy, and offer supportive services in response to local needs.

Term Limits

First, the term limit option described in this rule would be prospective—meaning any term limit the PHA applies would begin to count when the policy goes into effect. Previous time spent receiving assistance before implementing the policy would not count toward a term limit. As with work requirements, this section of the rule would incorporate significant flexibilities for PHAs and PBRA owners.

• Generally, this section applies to “non-elderly, non-disabled families.” The rule specifically notes that owners and agents can apply term limits “within and between” the different programs, so requirements could vary between projects and programs as well.
• PHAs could not set a term limit shorter than two years but would have the ability to implement a limit longer than two years.
• Like the work requirements section, PHAs would need to add these policies to their plans (and public housing leases, if applicable), implement a hardship waiver policy, and offer supportive services in response to local needs.
• The policies and tenant notifications would need to state what the PHA or owner will do to enforce time limits. Tenants would need to be notified in writing three months before policies are implemented, 12 months before a family hits a term limit, six months before the term limit, and 30 days before the term limit.  
• HUD proposes exempting HUD-VASH, FUP, and FYI, and agencies could exempt other special purpose vouchers as well.

This summary should serve as a general overview of a draft rule which is still subject to change.