NAHRO Comments on FSS Proposed Rule

On November 20, NAHRO submitted its comments on HUD’s proposed rule titled “Streamlining and Implementation of Economic Growth, Regulatory Relief, and Consumer Protection Act Changes to Family Self-Sufficiency (FSS) Program.” The proposed ruled will implement changes to the FSS program as amended by the Economic Growth, Regulatory Relief, and Consumer Protection Act (Economic Growth Act). The proposed rule included changes to the size calculation for the FSS program, expanding the definition of eligible family to include tenants of certain privately owned multifamily projects subsidized with Project-Based Rental Assistance (PBRA), updating the FSS Contract of Participation (CoP), reducing burdens on Public Housing Agencies (PHAs) and multifamily assisted housing owners, clarifying escrow account requirements, and updating the program coordinator and action plan requirements. 

Overall, NAHRO was pleased with HUD’s efforts to streamline and improve the FSS program, however NAHRO had some concerns. NAHRO recommended that HUD provide additional clarification to the effective date of the Contract of Participation, for how PHAs should determine their minimum program size, and for contract nullification. Although NAHRO appreciates that the proposed rule includes several provisions clarifying the FSS responsibilities between PHAs for families that move with continued HCV assistance from the jurisdiction of one PHA to another PHA under portability, NAHRO requests that the final rule provide additional discretion to PHAs and FSS families to determine what makes the most sense for the family at the time of port. NAHRO also asked for additional clarification in instances when an FSS participants is not the head of household, especially as it relates to independence from welfare assistance before graduation from the program.  

NAHRO recommended that HUD be more explicit in how future FSS formula funding will be distributed. Section 306 of the Economic Growth Act provides HUD the authority to award funds by formula. However, Section 306 also provides clear thresholds for “base” and “additional” awards of FSS coordinator funding based on the number of participants enrolled. The Economic Growth Act made the establishment of a formula for allocation of renewal funding mandatory. Although the Act provides some discretion over how to allocate funds for additional coordinators to new and existing FSS programs, NAHRO does not believe the proposed rule makes clear the specific requirements set forth in the Economic Growth Act in establishing the parameters for how a formula should be structured, especially as it relates to renewal funding.  

NAHRO also commented on FSS performance standards.  The Economic Growth Act includes language stating that FSS programs must meet certain performance standards to receive renewal funding or receive an additional award. The proposed rule does not make clear if the public will have the opportunity to comment on the performance criteria and how it would be connected to funding. NAHRO strongly recommends that HUD provide the public the ability to comment on any proposed performance standards. NAHRO also noted that it is important for HUD’s scoring system to not place excessive weighting on increased earned income. NAHRO further recommended any weighting of graduation rates and the earnings performance be equal, as NAHRO believes both are equally important and a better reflection of whether program participants are fulfilling their goals. 

NAHRO’s letters can be found here.