HUD Amends Definition of 'Tuition' for Determining Section 8 Income Eligibility

On Nov. 18, 2015, HUD published a joint notice under Notice PIH 2015-21: Amendment to the Definition of Tuition, which formally amends the definition of tuition found in Eligibility of Students for Assisted Housing Under Section 8 of the U.S. Housing Act of 1937; Supplementary Guidance [71 FR 18146, appendix A]. The new definition will be used in both Multifamily Housing and Public and Indian Housing (PIH) programs. The notice is effective immediately.

HUD found a need to broaden the definition of tuition because it has become aware of many institutions of higher education moving from a traditional tuition-only structure to a new tuition and fee structure. These fees often include, but are not limited to, student service fees, student association fees, student activities fees, and laboratory fees. According to HUD, the inclusion of many of these required fees within the definition of tuition will increase opportunities for its participants to further their education.

As a result, tuition is now defined as the amount of money charged to students for instructional services that may be charged per term, per course, or per credit plus required fees. Examples include, but are not limited to, writing and science lab fees and fees specific to the student’s major or program such as a nursing program.

But other expenses related to attending an institution of higher education are not to be included as tuition. These expenses include books, supplies, room and board, meal plans, transportation and parking, student health insurance plans, and other non-course-related fees.

Income Determination

In implementing the amended definition of tuition, for Section 8 programs only, owners must include amounts of financial assistance an individual receives in excess of tuition and other required fees and charges when determining annual income in accordance with 24 CFR Section 5.609(b)(9).

Under other programs, such as the Public Housing program, the full amount of financial assistance a student receives while participating in the program continues to be excluded from the program participant’s annual income, pursuant to 24 CFR Section 5.609(c)(6).

Example: Kim, a 22-year-old, married participant in a Section 8 program is enrolled in a nursing program at her local community college. She is receiving $7,000 in financial assistance to cover the full cost of tuition and fees of $6,000 for the academic year. The $6,000 includes: $2,500 in tuition per semester (total $5,000 for both semesters) plus $500 in individual fees (total $1,000 for both semesters)—athletic fee, writing laboratory fee, student center fee, science laboratory fee, technology fee—charged to every student per semester.

The excess $1,000 ($7,000 - $6,000) Kim received in financial assistance will be included in her annual income in accordance with 24 CFR Section 5.609(b)(9).

Under HUD’s previous definition of tuition, Kim’s housing authority might have considered her financial assistance to be in excess of $2,000 if her college’s definition of tuition did not include fees. Under HUD’s new definition, Kim’s housing authority will determine her excess financial assistance to be $1,000 rather than $2,000 because the required fees and charges are included with tuition.

If Kim was a participant in the Public Housing program, the full amount of financial assistance she received would be excluded from her income in accordance with 24 CFR Section 5.609(c)(6).

Verification of Tuition and Fees

Owners and PHAs must verify the amounts of tuition and required fees charged by the school when determining annual income. Owners may wish to verify those amounts using the student’s bill or account statement (including an online account statement) as provided by the school’s financial affairs office, or by contacting the financial affairs office directly. HUD recommends owners visit the school’s website as many institutions of higher education provide an itemized list covering tuition and fees that are charged to a majority of their students on their websites.