HUD HCV Guidebook § 2.6

MTW PHAs can set alternative rent policies, outside of the standard regulations governing the use of FMRs in
setting payment standards with approval from HUD. MTW PHAs administering the HCV program can exercise
flexibility when establishing rent in accordance with the terms of its respective MTW Agreement and approved
Annual MTW Plan or MTW Supplement to the Annual PHA Plan. However, MTW PHAs cannot set payment

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   For tax credit units that meet the criteria of 24 CFR 983.301(c)(1), including the criterion that the tax credit
rent exceeds the applicable FMR or any exception payment standard, the maximum rent is the lowest of (i) An
amount determined by the PHA in accordance with the Administrative Plan, not to exceed the tax credit rent
minus any utility allowance; (ii) The reasonable rent; or (iii) The rent requested by the owner. See also
additional rent limitations at 24 CFR 983.304-983.305.
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   24 CFR 982.635(b)(4)
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   24 CFR 982.635(b)(3)

standards for Special Purpose Vouchers (SPVs) that are inconsistent with the requirements in the Notice of
Funding Opportunity (NOFO)/operating requirements.29 MTW PHAs that choose to adopt alternative payment
standards are strongly encouraged to ensure that HCV program participants have similar access to a wide
range of communities as they would under SAFMRs. If an MTW PHA has not exercised flexibility through its
Annual MTW Plan or MTW Supplement to the Annual PHA Plan, the SAFMR requirements will apply to the MTW
PHA, and the MTW PHA will be required to use SAFMRs in place of metropolitan-wide FMRs if the PHA
jurisdiction is located within a designated Small Area FMR metropolitan area. Any MTW PHA that does not
operate in a metropolitan area where the use of SAFMRs is mandatory may choose to adopt SAFMRs,
following the procedures outlined in Notice PIH 2024-34.