On March 13, 2023, HUD’s Office of Public and Indian Housing (PIH) issued Notice PIH-2023-03, which provides supplemental guidance on the implementation of HOTMA Section 103.
This section of HOTMA applies only to public housing agencies (PHAs) with 250 or more public housing units. Section 103 became effective on March 16, 2023, and PHAs must fully implement over-income policies no later than July 14, 2023.
According to the statute, after a household’s income has exceeded the over-income (OI) limit for 24 consecutive months, a PHA must either terminate the household’s public housing tenancy within six months or allow by PHA policy the OI household to continue to live in a public housing unit by charging the household an alternative rent. The alternative rent must equal the greater of the Fair Market Rent (FMR) or the amount of monthly subsidy provided for the unit as determined by the amount of Operating and Capital Funds apportioned to a unit.
Over-Income Limit
The over-income limit is established by multiplying the very low-income level for the applicable area by a factor of 2.4, a limit equal to approximately 120% of the area median income (AMI).
Falling Below OI Limit
If the PHA determines (in an interim or regular reexamination) that a family’s income has fallen below the OI limit at any time during the 24-month grace period, the family will remain public housing eligible and return to regular income reexamination periods. If the family becomes OI again, a new 24-month grace period begins.
Notices
Once a family is determined to be over-income, a PHA must notify the household. Notice PIH-2023-03 requires three written notices, while PIH-2019-11 required only two. Each notice must be given within 30 days of the income examination that determines the family is, or remains, OI – at the initial determination of OI status, following the reexamination at the conclusion of the first 12 months of the grace period, and at the conclusion of the 24-month grace period.
Policies
PHAs must have a “continued occupancy policy” detailed in its Admissions & Continued Occupancy Policy (ACOP) that either requires OI families to execute a new non-public housing over-income (NPHOI) lease within 60 days of notification and charge the family the alternative non-public housing rent or terminate the tenancy of the family no more than six months after the notification.
Bottom Line
PHAs that have not fully implemented the HOTMA requirements relating to over-income public housing residents must do so no later than July 14, 2023.