HUD Issues Regulatory Waivers and Flexibilities for PHAs in Disaster Areas

The year 2021 was marked by climate extremes across the U.S., including exceptional warmth, devastating severe weather, and the second-highest number of billion-dollar weather and climate disasters on record, according to the National Oceanic and Atmospheric Administration (NOAA). In fact, a record warm December 2021 initiated a pair of devastating tornado outbreaks and caused two of the year's $20 billion disaster events.

Since the start of the year, HUD has announced disaster assistance for three different states. In November 2021, a massive wind and rainstorm triggered flooding and mudslides in areas of Washington state. Earlier that summer numerous fires occurred each day in the area in what would become one of the region’s worst wildfire seasons ever recorded. The burning destabilized the hills, and when the downpours hit the slopes it set off powerful surges of mud and debris. In December 2021, Arkansas was affected by severe storms and 68 tornadoes. And, according to the NOAA, it was the deadliest December tornado outbreak on record, with at least 90 fatalities reported.

Currently HUD is implementing federal disaster assistance for areas in Colorado affected by straight-line winds and wildfires that started on Dec. 30. Exceptionally warm and dry conditions through the fall, including a lack of snowfall, created the perfect conditions for a fast-spreading blaze. The unprecedented wind-driven wildfire in December destroyed hundreds of properties, injured at least a half dozen people, and prompted the evacuation of tens of thousands of residents.

As these weather-related disaster events become more common, we can expect streamlined procedures from HUD in assisting families affected by presidentially declared disasters. On Jan. 5, in response to the series of disasters, HUD published a new waiver notice for areas affected by these types of disasters. The notice provides an expedited process for PHAs to apply for certain waivers and flexibilities when faced with a presidentially declared disaster. The notice is effective from Jan. 1, 2022, to Dec. 31, 2023.

Types of Waivers Available

The following summarizes the flexibilities and waivers that PHAs may request:

Operating subsidy flexibility for vacancies. A PHA is eligible to receive funding for vacant public housing units that are vacant because of a declared disaster, subject to HUD approval. Eligible units will be considered approved for 12 months.

Financial reporting flexibilities. With regard to uniform financial reporting standards, filing financial reports, and reporting compliance dates, the notice says HUD may approve delays to certain financial reporting requirements.

Public housing assessment system. HUD may consider waiving the physical inspection and scoring of public housing projects.

Maximum project cost. HUD may waive total development costs (TDC) and housing cost cap limits for all work funded through the Capital Fund until the next issuance of TDC limits.

Tenant selection policies. HUD may waive requirements that a PHA’s Board of Commissioners approves revisions to tenant selection policies and a PHA’s administrative plan if the revisions are temporary, don’t exceed a period of 12 months, aren’t significant amendments, and comply with the PHA’s plan or state law.

Waiting lists. HUD may waive the requirement that it must provide public notice when opening and closing its waiting list by posting in a local newspaper of general circulation. It would replace that requirement by an alternative one requiring the PHA to post notice to its website. The waiver won’t exceed a period of 12 months.

HUD approval of exception payment standard amount. HUD may approve an exception payment standard that’s higher than 110 percent of the Fair Market Rent.

Housing Quality Standards. HUD may waive the requirement that units have at least one bedroom for every two people to house families displaced by natural disasters. The waiver will be in effect for the initial lease term.

Contract of participation extension. HUD may consider authorizing a PHA to extend a family’s contract of participation in a Family Self Sufficiency program for up to three years. Any waiver will be in effect for a request made to the PHA during a period of up to 12 months.

Section 8 Management Assessment Program (SEMAP) scores. HUD may consider a request to carry forward a PHA’s last SEMAP score.

Social Security verification. HUD may consider a request to transmit form HUD-50058 within 90 days, instead of the usual 30 days, of the receipt of the applicant’s Social Security documentation.

According to the notice, a PHA may also request an exception to a requirement that isn’t listed. HUD will consider these requests subject to statutory and regulatory limitations. To request a waiver and get an expedited review of the waiver request, either listed or not identified in the notice, a PHA in a presidentially declared disaster area is required to complete and submit a checklist, Appendix A of the notice. The notice can be found at www.govinfo.gov/content/pkg/FR-2022-01-05/pdf/2021-28561.pdf.