Master Class
Training
Tenant Paid
Utility Allowances
Cindy Ross
Contract Management Services
Utility Allowance
Regulations
Source: HUD HQ Memo dated June 20, 2011
Carol J. Galante, Deputy Assistant Secretary for Multifamily
And
HUD-Seattle Utility Allowance Procedure
BOLD lettering throughout this presentation is a representation of the most
common submission deficiencies…
• The Owner must provide the Contract Administrator (CA) a 12
month analysis of utility costs that residents incur on an annual
basis
• Analysis – and – supporting documentation
o Must be sent to the CA at least 120 days prior to the HAP contract’s
anniversary date, along with the Owner’s annual Rent
Adjustment/Contract Renewal packet
• At least six (6) months prior to the contract’s anniversary date,
the Owner collects utility data from either the: 1) Resident; 2) Utility
Provider; or 3) a combination of both.
• Example:
o HAP contract = 2/1/2015 – 1/31/2020
o The entire Owner’s Packet: Utility Allowance Analysis and Rent
Adjustment or Contract Renewal paperwork should be received at the
CA’s office on or before 10/3/2014 (120 days prior to the contract’s
anniversary)
o Contract Anniversary = February 1st
o Six months prior to February 1st = August 1st, 2014
o Data collection period = July 2013 through June 2014
• Suggested: The Owner generates a 12 month vacancy report for
the property that reflects the months included (July 2013 – June
2014) in the analysis:
o Include the vacancy report as supporting documentation for the analysis
(not required, but this helps YOU and US in case discrepancies exist)
o Remove all units that experienced a vacancy during the analysis
timeframe from the calculations
• The analysis and supporting documentation (copies of billings, or
unit specific data obtained directly from the utility provider) must be
for all units that did NOT experience a vacancy during the 12
month analysis period (assisted units)
• When the property has unit types (1 Bd., 2 Bd., etc.) with 10 or
fewer units
o Data should be collected for all units which have not experienced a
vacancy
o No less than three (3) units
• When the property has unit types (1Bd., 2 Bd. , etc.) with 11 or
more units
o Data must be collected for 20% of units for each unit type
o No less than three (3) units
o No more than 20 units
• The data collected must:
o
Be for the most recent 12 month period possible
o
Begin or end during the same service month, when the unit’s
resident pays for more than one type of utility
o
February’s gas billing dates: 2/10/2014 – 3/9/2014
o
February’s electric billing dates: 1/25/2014– 2/24/2014
o
Include billed charges (cost of electricity, gas, etc.)
o
Include total billing adjustments, as applicable
• The Owner prepares a spreadsheet that averages utility costs
incurred for each qualifying unit over the 12 month analysis period
by unit type
o
Sample spreadsheet available at www.cms-results.com
o
The CMS spreadsheet will calculate the average allowance(s) and has a
space for the Owner’s recommendation
When the spreadsheet indicates that a decrease of any amount is
warranted to one or more of the unit types at the property, the Owner
must inform the residents in writing that they are submitting a
request to lower the tenant-paid utility allowance.
Sample posting/letter is available at: www.cms-results.com
Tenant Notification
• The Owner serves notice to residents approximately five (5) months prior
to the Contract Anniversary
o
Notice must be served by delivery (1 or 2 story buildings)
o
Notice may be served by mail or direct delivery or by posting in three (3)
conspicuous places within each building that has three (3) or more floors
• All materials associated with the Rent Adjustment or Contract Renewal and
Utility Allowance Analysis must be made available to the residents for review
and copying for 30 calendar days
• When the Owner makes any material change after initial tenant notification,
they must re-post and give the residents an additional 15 calendar days to
review and comment
• All of these steps should be completed prior to 120 days before the
contract’s anniversary date
Tenant Notification
• Tenants have the right to participate, establish and operate a tenant
organization to address issues related to their living environment
• The Owner must recognize tenant organizations providing
reasonable consideration to concerns raised
• Legitimate Tenant Organizations:
o
Must be established by the residents of multifamily housing properties
o
Must meet regularly
o
Must operate democratically
o
Must be completely independent of Owners, Management and their
Representatives
Tenant Notification
• All comments received from residents or a tenant organization
must be evaluated by the Owner; the Owner may:
o
Respond via letter
o
Respond via “Town Hall” type meeting
• The Owner must certify that they are compliant with all of the
requirements of the CFR, after the 30 day posting period has
ended:
o
Certification available at: www.cms-results.com
Tenant Notification
• The Owner may electronically submit their Contract Renewals,
Rent Adjustments, and Utility Analysis paperwork to the CA via
email: mailto:contractdept@cms-results.com
o
Additionally, any documents with “wet” Owner signatures must also be
mailed to the CA
• The Owner packet will include:
o
Renewal or Rent Adjustment Forms & Certifications
o
Utility Allowance Summary/Recommendation, supporting documentation,
copies of all resident comments received, and the Owner’s response to
the residents’ comments
o
Owner’s Certificate of Compliance with tenant notification requirements
See www.cms-results.com for detailed checklists of necessary forms
Should you have any further inquiries, please contact:
Cindy Ross
CMS Associate Director
(360) 616-7220
cross@cms-results.com
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