HUD Handbook 7465.1 § 6-3

a.      POLICY - Employees who are required to live-in public
            housing as a condition of their job

            (1)   Persons who are hired as PHA employees and must
                  live in a public housing unit as a condition of
                  their job are not considered public housing
                  tenants. They are not subject to the same
                  requirements and do not have the same rights as
                  public housing tenants. In particular, they:

                  (a)   do not have to qualify as a lower income
                        family;

                  (b)   are not subject to the PHA's tenant selection
                        procedures;

                  (c)   do not have their rent calculated according
                        to HUD regulations;

                  (d)   are not subject to HUD lease and grievance
                        provisions; and

                  (e)   would not be able to remain in public housing
                        if their employment were terminated.

            (2)   PHAs may charge employees who are required to live
                  in public housing as a condition of their job some
                  reasonable rent, although that rent can be a flat
                  amount not related to the person's income. PHAs
                  may also provide the apartment to the employee
                  rent-free.

            (3)   Dwelling units which are used to house PHA
                  employees are excluded from total unit months
                  available for occupancy (UMAs) for purposes of
                  calculating operating subsidy under the
                  Performance Funding System (PFS). The full amount
                  of any rent the employees pay must be included in
                  the projections of other income for PFS
                  calculations; no allowance is provided for
                  offsetting expenses. (See the Financial Management
                  Handbook, 7475.1)

            (4)   PHAs must get HUD approval to house PHA employees
                  in any public housing dwelling unit which has been
                  previously designated for use by public housing
                  tenants.

       b.   POLICY - Tenants employed by the PHA

            (1)   Public housing applicants who work or expect to
                  work for the PHA are subject to the same admission
                  requirements as other applicants.

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(a)   The work they are to do for the PHA may not
                        be a condition of their admission.

                  (b)   They may not be given a selection preference
                        based or their willingness to work for the
                        PHA.

            (2)   Public housing tenants who happen to work for the
                  PHA are subject to all of the occupancy
                  requirements and have all the same rights and
                  responsibilities as other public housing tenants.

                  (a)   The work they do for the PHA may not be a
                        condition of their tenancy.

                  (b)   Any amounts they receive for their employment
                        must be counted as income in computing their
                        rent.

                  (c)   The PHA may not lower the amount they are
                        required to pay as rent as compensation for
                        their employment.

            (3)   The PHA does not need HUD authorization in order
                  to employ public housing tenants.

       c.   DISCUSSION - Employees who are required to live in public
            housing as a condition of their job.

            (1)   It is advisable for PHAs to have a lease with
                  employees who are required to live in public
                  housing. A standard private-market lease would
                  usually be acceptable, although the PHA should add
                  a provision making the person's continued
                  occupancy contingent on their employment.

            (2)   An employee who resides in public housing may
                  apply to become a public housing tenant, but would
                  have to qualify and be selected like any other
                  applicant.

            (3)   All the provisions and procedures related to
                  employees who are required to live in public
                  housing would apply whenever the PHA wanted to
                  house persons from public or private agencies who
                  would provide tenant-oriented services. However,
                  the PHA might want to consider whatever amount
                  those agencies would provide for lodging in
                  establishing the person's rent. Tenant-oriented
                  services may help meet tenants' needs related to
                  health, education, welfare, recreation, or
                  employment.

d.   PHA PROCEDURES

            (1)   PHAs which want to house PHA employees in any
                  public housing dwelling unit which has been
                  previously designated for use by public housing
                  tenants must follow the procedures covering the
                  conversion of dwelling units. The procedures are
                  in Chapter 7 of HUD handbook 7468.1, The Public
                  Housing Demolition, Disposition and Conversion
                  Handbook.

            (2)   Employees who are required to live in public
                  housing as a condition of their job are reported
                  on Form HUD-51234. The PHA does not fill out a
                  Form HUD-50058 for them.

       e.   REFERENCES

            Annual Contributions Contract

            U.S. Housing Act of 1937, Section 3(a)

            24 CFR 913.106, 913.107

            24 CFR 990

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