PHA Oversight: How Scandals and Mismanagement Harm Residents and Taxpayers (EventID=117346)

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Connect with the House Financial Services Committee Get the latest news: https://democrats-financialservices.house.gov/ Follow us on Facebook: https://www.facebook.com/HouseFinancialCmte Follow us on Twitter: https://twitter.com/FSCDems ___________________________________ On Wednesday, May 22, 2023, at 10:00 a.m. (ET) Housing and Insurance Subcommittee Chairman Congressman Davidson and Ranking Member Congressman Cleaver will host a hearing entitled, “PHA Oversight: How Scandals and Mismanagement Harm Residents and Taxpayers." ___________________________________ Witnesses for this one-panel hearing will be: • Mr. Bill Slover, Principal, AVCO Interests and former Chair of the District of Columbia Housing Authority (DCHA) Board • Mr. Matt Doherty, Former Executive Director, Atlantic City Housing Authority (ACHA) • Mr. Georgi Bana, General Counsel and Director of Strategic Initiatives, National Association of Housing and Redevelopment Officials (NAHRO) ___________________________________ General Background This hearing will highlight the troubling number of Public Housing Agencies (PHAs) that are failing to achieve their core mission to manage federal housing dollars and safeguard residents. PHAs are local, quasi-governmental entities that administer federal housing assistance programs under contracts with the Department of Housing and Urban Development (HUD). They are recognized under federal law as any state, county, municipality, or other governmental entity or public body that builds or operates units under HUD’s Public Housing or Section 8 Housing Choice Voucher programs. There are more than 3,300 PHAs across the nation, managing over 900,000 Public Housing units and administering over 2.3 million vouchers. While PHAs range in size from the very small (0-49 assisted housing units) to the very large (10,000+ units), roughly two-thirds of all PHAs manage 500 or fewer units and one-third of all PHAs manage fewer than 100 units. PHAs manage their properties in accordance with federal program rules. By law, as a condition of receiving federal housing funds, PHAs are required to provide decent, safe, and sanitary housing for their residents. They are also required to maintain the physical conditions of units as well as accurate records of resident incomes, unit occupancy, and rents paid to property owners. PHAs must also submit periodic plans to HUD for how they are using funds to serve the needs of their residents. These residents include low-, very low-, and extremely low-income households, and some of the most vulnerable populations, such as the elderly and disabled. Depending on the HUD program involved, PHAs may own the units they manage (such as under the Public Housing program) or contract with private owners or landlords to provide housing assistance for a resident (such as under the Section 8 Housing Choice Voucher program). They may also perform duties under the Performance-Based Contract Administration (PBCA). PBCAs are contracted and paid by HUD to perform tasks including make subsidy payments to landlords under the Section 8 ProjectBased Rental Assistance program, among other responsibilities. Oversight of PHAs While PHAs are local entities organized under local laws, they are also subject to federal rules and oversight by HUD’s Office of Public and Indian Housing (PIH). Thus, ultimately it is the responsibility of HUD to hold all PHAs accountable and take corrective action to protect residents and taxpayers. As part of its federal oversight, HUD uses multiple compliance tools, including requiring regular reporting on each PHA’s “policies, programs, operations, and strategies for meeting local housing needs and goals.” In addition, the performance of each PHA is scored using the Public Housing Assessment System (PHAS), which is based on physical (40 percent), financial (25 percent), management (25 percent) and capital fund (10 percent) indicators. Out of a total of 100 points, PHAs scoring 90 or higher are designated as “High Performing,” those scoring between 89 and 60 are designated as “Standard” or “Substandard,” and those scoring 59 or less are designated as “Troubled.” PHAs designated as Troubled are subject to additional federal scrutiny. For example, Troubled PHAs are subject to annual assessments (vs. every two years for other PHAs). HUD is also required to conduct additional onsite assessments and monitoring under a corrective action plan developed and followed by the PHA. Troubled PHAs are given a maximum of two years to improve their overall PHAS score and must make “substantial improvement.” This includes cutting in half the difference between their PHAS score and 60 within the first year. Those that do not make this improvement can be declared in “substantial default” of their contract with HUD. Substantial default status provides HUD... ___________________________________ Hearing page: https://democrats-financialservices.house.gov/events/eventsingle.aspx?EventID=411495