HUD HCV Guidebook § 13

The following terms are used in this Chapter:
Absorption the point at which a receiving PHA starts making assistance payments with funding under its
consolidated ACC, rather than billing, the initial PHA.
Administrative Fee is the fee paid by HUD to the PHA for administration of the program.
Higher Cost Unit, as related to portability, is defined as a unit which requires a higher subsidy amount due to
an increase in the gross rent for the new unit.
Higher Cost Area, as related to portability, is defined as an area where the PHA would have to pay a higher
subsidy amount due to higher payment standards or more generous subsidy standards of the receiving PHA
(e.g. the receiving PHA issues a 3-bedroom voucher to a family that received a 2-bedroom voucher from the
initial PHA).
Initial PHA.portability, the term refers to both:
        •   A PHA that originally selected a family that later decides to move out of the jurisdiction of the
            selecting PHA; and
        •   A PHA that absorbed a family that later decides to move out of the jurisdiction of the absorbing
            PHA.
Portability means the ability to rent a dwelling unit with Section 8 tenant-based assistance outside the
jurisdiction of the initial PHA.
Receiving PHA is a PHA that receives a family selected for participation in the tenant-based program of
another PHA. The receiving PHA issues a voucher and provides program assistance to the family.

Exhibit 1:               Outgoing Portability Processing Log

Moves and Portability                                                                                  36

                                               Date     Receiving PHA    50058 &   Billing
                        Participant Voucher                                                   Date    Absorb/                Notes/
                                              Voucher   Name, Address,    52665     Due                            Date
                          Name      Number                                                   52565
                                              Expires     Telephone,      Sent     Date              Administer   Complet   comments
                                                                                             Rec’d
                                                          Email, Fax                                                e
Moves and Portability

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                                                                                        Initial PHA Name,
                                                  Date                Date
                        Participant   Voucher               50058 &          Date HAP         Address,                       Date         Notes/
                                                Extension            RFTA                                   Date Billing
                          Name        Number                 52665           Executed   Telephone, Email,      Due         52665 (iII)
                                                 Expires            Received                                                             comments
                                                                                                 Fax                         Sent
Moves and Portability

Exhibit 2: Incoming Portability Leasing Log

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Exhibit 3: Guidance on PHA Entries for Returning Unearned
HAPs and Fees under Portability
A number of cases have surfaced in which the receiving PHA did not promptly inform the initial PHA that billing
arrangements were terminated as the result of absorption by the receiving PHA or families leaving the
program. As a result, the initial PHA continued to make monthly payments for housing assistance payments
and administrative fees to the receiving PHA. The receiving PHA is required to refund the excess payments to
the initial PHA. The following guidance is provided regarding how to appropriately record in your accounting
records accounting entries to accommodate the returned payments.

RECEIVING PHA                                              INITIAL PHA
                                                            •   When the initial PHA recognized the
 •   Normally, the receiving PHA would have recorded
                                                                obligation under the billing arrangement for
     the following when the HAP was paid to the owner
                                                                the family that moved under the portability
     on behalf of the family:
                                                                procedures it would have created the
     − DR          Accounts Receivable - Initial PHA (for       expense and the payable:
          HAP and fee)
                                                                − DR        Expense - Control (and
     − CR          Income (for Fee)                                 subsidiaries for HAP and administrative
     − CR          Cash (for HAP payment)                           expenses)
 •   Upon receipt of payment of HAP and fees from the           − CR        Accounts Payable - Receiving
     initial PHA, the Receiving PHA would have:                     PHA
     − DR Cash                                              •   When the initial PHA then paid the receiving
     − CR          Accounts Receivable - Initial PHA            PHA:
 •   Typically, when the billing arrangement ceased, the        − DR        Accounts Payable - Receiving
     first set of transactions did not happen (the owners           PHA
     were not paid and the income was not recorded)             − CR        Cash
     because the receiving PHA had terminated the HAP       •   When the initial PHA receives the funds
     contract. The receiving PHA failed to inform the           back from the receiving PHA:
     initial PHA and continued to debit “Cash” and
                                                                − DR Cash
     credit “Accounts Receivable” when the payment
     arrived from the initial PHA. The large CR balance         − CR        Expenses - Control (and
     in the “Accounts Receivable” is an indication to the           subsidiaries)
     receiving PHA that something is amiss.
 •   When the receiving PHA returns overpaid funds to
     the initial PHA, the receiving PHA would:
     − DR          Accounts Receivable - Initial PHA
     − CR          Cash
 •   When all refunds are made, the “Accounts
     Receivable” balance will be zero or at normal
     levels.

Moves and Portability                                                                                 39