HUD PIH Notice § 2020-01

                                 U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
                                                WASHINGTON, DC 20410-5000


OFFICE OF PUBLIC AND INDIAN HOUSING




Special Attention of:                                        Notice PIH 2020-01
Directors of HUD Regional and Field
Offices of Public Housing; Public Housing                    Issued: January 22, 2020
Agencies (PHAs) that Administer
the Housing Choice Voucher (HCV) Program                    Expires: Effective until amended,
                                                            superseded, or rescinded
                                                             Cross Reference(s): PIH Notice
                                                             2013-19; PIH Notice 2012-21; 24
                                                             CFR Part 982

Subject: Revised Policies and Procedures for the Mainstream Voucher Program

1. Purpose: This notice updates policies related to the Mainstream Voucher Program. This
   notice supersedes prior notices providing guidance related to the Mainstream Voucher
   Program.

2. Background: Initially authorized by the National Affordable Housing Act of 1990 (Public
   Law 101-625), the Mainstream Voucher Program has provided voucher assistance to
   persons with disabilities since 1997. Until the passage of the Frank Melville Supportive
   Housing Investment Act of 2010 (Public Law 111-374) (“Melville Act”), the program was
   operated as a separate voucher program from the regular tenant-based HCV Program. The
   Melville Act converted the Mainstream 5-Year program (sometimes referred to as the
   Section 811 Voucher Program) to the HCV Program under 8(o) of the U.S. Housing Act of
   1937.

    The Consolidated Appropriations Act, 2017 (Public Law 115-31) provided funding for
    incremental Mainstream Vouchers for the first time since the enactment of the Melville Act
    (in addition to providing renewal and administrative fee funding for these vouchers). These
    incremental vouchers exclusively assisted non-elderly persons with disabilities. The
    Consolidated Appropriations Act, 2018 (Public Law 115-141) and the Consolidated
    Appropriations Act, 2019 (Public Law 116-6) (“2019 Act”) also provided funding for
    incremental Mainstream Vouchers for non-elderly persons with disabilities, in addition to
    renewal and administrative fee funding. In addition, the 2019 Act states that all new and
    existing Mainstream Vouchers must be provided to non-elderly persons with disabilities
    upon turnover. Funding for these Mainstream Vouchers was provided in a separate
    paragraph under the Tenant-Based Rental Assistance (TBRA) heading in each years’
    appropriations act.

3. Applicability: The policies and procedures listed below are applicable to all PHAs that
   were awarded Mainstream Vouchers or PHAs that administer Mainstream Vouchers
   through a portability billing arrangement. This includes vouchers formerly known as
   “Mainstream 5-Year” Vouchers.



                                      www.hud.gov        espanol.hud.gov
   This notice supersedes previous notices as they pertain to the Mainstream Voucher
   Program, including information about the Mainstream Voucher Program included in PIH
   Notice 2013-19: Revised Policies and Procedures for Special Purpose Housing Choice Vouchers
   for Non-Elderly Disabled Families and Other Special Populations. Section 7 of PIH Notice 2013-
   19 may still serve as a helpful resource on addressing fair housing-related issues, for example,
   reasonable accommodations, length of voucher term searches to find suitable housing, housing
   search assistance for households with a member who is a person with disabilities including to locate
   accessible housing options, referral services, etc.

   This notice DOES NOT apply to Non-Elderly Disabled (NED) Vouchers or “Mainstream 1
   Year” Vouchers. Mainstream 1 Year vouchers have almost entirely been converted to NED
   vouchers except for a few Moving to Work (MTW) programs that still have a separate line
   item for Mainstream 1.

   NED vouchers serve non-elderly disabled families, defined as families with a head, co-head, or
   spouse who is under age 62. More information on reporting and policies for NED vouchers may
   be found in PIH Notice 2013-19. While Mainstream Vouchers serve non-elderly persons with
   disabilities, they are not “NED” vouchers. The funding, monitoring, and eligibility requirements
   are different for NED and Mainstream Vouchers.

   PHAs must follow the protocols in this notice for their Mainstream Vouchers. PHAs may
   contact their Financial Analyst to obtain their baseline number of vouchers for each
   program.

4. Effective Date: This notice is effective upon publication.

5. Program Policies:

    a.   Eligible population. Mainstream Vouchers (also formerly known as Mainstream 5-
         Year Vouchers or Section 811 Vouchers) are tenant-based vouchers that serve a
         special population of households. All Mainstream Vouchers will now serve
         households that include a non-elderly person(s) with disabilities, defined as any
         family that includes a person with disabilities who is at least 18 years old and not yet
         62 years old at the effective date of the initial Housing Assistance Payment (HAP)
         Contract, (i.e., the effective date of the New Admission [action code =1] on the form
         HUD-50058 (or form HUD-50058 MTW).

    b.   Once eligible, participants do not “age out” of eligibility. Existing families
         receiving Mainstream Vouchers, where the eligible family member is now age 62 or
         older, will NOT “age out” of the Mainstream Voucher Program as long as the family
         was eligible on the day it was first assisted under a HAP contract.

    c.   Reissuance of Mainstream Vouchers. At turnover, ALL Mainstream turnover
         vouchers must be reissued to the next Mainstream-eligible family on the PHA’s
         waiting list. Turnover occurs when a family receiving Mainstream voucher assistance
         leaves the program. Mainstream-eligible families are those that include at least one
         non-elderly (at least age 18 and not yet 62 years of age) person with disabilities.

                                                   2
     PHAs that administer Mainstream voucher assistance will need to determine if there
     are additional families on their waiting list that are made eligible for Mainstream
     voucher assistance based on the change in eligible population. See Section g., sub-
     section iv. (on page 4 of this notice) for PHA options on updating the waiting list for
     this change in eligible population. If a Mainstream turnover voucher becomes
     available, PHAs must determine if the families at the top of their waiting list qualify
     under the new program requirements. This change is effective immediately for those
     turnover vouchers that have not already been issued.

d.   Mainstream Vouchers are regular HCVs with special eligibility criteria. Aside
     from separate funding appropriations and serving a specific population, Mainstream
     Vouchers are administered the same as regular voucher assistance in that Mainstream
     Vouchers are regulated under the same program requirements as the HCV Program.
     The same regulations at 24 CFR Part 982 apply to Mainstream Vouchers. Federal
     nondiscrimination laws and requirements apply as with all HCVs, including for
     example, requirements regarding nondiscriminatory eligibility criteria, and obligations
     to provide reasonable accommodations for person with disabilities. See 24 C.F.R. §
     5.105(a). There is no special authority to treat families that receive a Mainstream
     Voucher differently from other applicants and participants of the HCV program. For
     example, the PHA cannot apply different payment standards, establish conditions for
     allowing portability, or screening criteria for Mainstream Voucher families from
     regular HCV families. See Section 5, sub-section i (on page 5 of this notice) for
     more information.

e.   Awarded vouchers are for new admissions. PHAs must lease the awarded vouchers
     by selecting Mainstream-eligible applicants from the waiting list. PHAs are not
     permitted to reassign existing participants to the Mainstream Voucher Program in
     order to make regular tenant-based vouchers available. There is no provision that
     allows PHAs to admit tenants without following their waiting list procedures when
     using a Mainstream Voucher.

f.   One Waiting List Requirement. PHAs must maintain one waiting list for all tenant-
     based assistance (24 CFR 982.204(f)), which includes Mainstream voucher assistance.
     PHAs must not have a separate waiting list for Mainstream voucher assistance. When
     issuing a Mainstream Voucher, the PHA will choose the first Mainstream-eligible
     family from its tenant-based waiting list.

g.   Admissions Preference. An admissions preference affects the order applicants
     appear on the waiting list. Preferences apply to all vouchers on the waiting list, not
     only Mainstream Vouchers. If your PHA claimed points for a preference in a
     Notice of Funding Availability (NOFA) application, your PHA must adopt a
     preference for at least one of the targeted groups in the NOFA. Adopting an
     admissions preference does not necessarily mean that every person that receives
     assistance will meet the preference criteria.

       i. PHAs may limit the number of applicants who will qualify for the preference –
          24 CFR 982.207(a)(3) allows PHAs to set a limit to the number of applicants

                                            3
          that may qualify for a local preference. HUD expects PHAs that claim points
          under a NOFA will establish a preference consistent with the terms in that year’s
          NOFA.

      ii. Option to open PHA waiting list for a limited preference – The PHA may adopt
          criteria defining which families may apply for assistance when opening its
          waiting list (24 CFR 982.206(b)(1)). For example, if the PHA opens its waiting
          list solely for applicants that meet the preference for targeted subgroups identified
          in the Mainstream Voucher NOFA, the PHA must provide public notice that it is
          opening its waiting list specifically for non-elderly persons with disabilities who
          are transitioning out of institutional or other segregated settings, at serious risk of
          institutionalization, homeless, or at risk of becoming homeless. The PHA must
          comply with the requirements for opening the waiting list under 24 CFR 982.206,
          including the requirement to provide public notice and to accept applications from
          families for whom the list is open.
      iii. Update PHA preference policy/procedures – To effectively apply and manage
           preferences, the PHA must have a written policy for how preferences will be
           applied including how families with the same preference will be selected, either
           in order by the date and time of their application or a random choice technique
           (24 CFR 982.207(c)).

h.   Waiting List Updates.

     Updating Waiting List for change in eligible population PHAs may choose to do a full
     waiting list update or a limited update. A full or limited update may be done regardless
     of whether a PHA will be opening the waiting list or not.

     Full Waiting List Update: Update entire existing waiting list to determine if all current
     applicants meet the eligibility criteria for Mainstream Vouchers and new preferences (if
     adopted).

     Sample process for preparing for and leasing to Mainstream-eligible families including
     a full waiting list update
         o Step 1: Send out letter to all applicants on the current waiting list to identify (1)
             if there are any household members who are non-elderly persons with
             disabilities and (2) if the household qualifies for the new preference (if
             applicable).

        o Step 2: Update waiting list order based on new information on preferences and
          the PHA’s specific policies for how to apply preferences.

        o Step 3: Begin pulling families from waiting list, beginning with the first
          Mainstream-eligible family on the HCV tenant-based waiting list.



                                             4
     Limited Waiting List Update: If a PHA is NOT adopting a new preference, then a PHA
     may determine the eligibility of existing families on the waiting list in smaller batches.
     For example, a PHA could contact the top 30 families on the waiting list to determine if
     any of these families qualify for a Mainstream Voucher, offering a Mainstream
     Voucher to the first family that includes a non-elderly person with disabilities in the
     order they appeared on the waiting list. Since these names are highest on the waiting
     list, any eligible families would be the first to be eligible for a Mainstream Voucher.

     Regardless of the number of Mainstream families the PHA is required to serve, the
     next family on the waiting list MUST be served in accordance with the PHA’s
     administrative plan policies. Therefore, the PHA cannot skip over a Mainstream-
     eligible family because it is currently serving the required number of Mainstream
     families. For example, if the PHA has leased 100 percent of its Mainstream
     Vouchers, but is ready to issue five regular vouchers, and the next five families on the
     PHAs waiting list all include a non-elderly person with disabilities, the regular
     vouchers would be issued to the next five families on the waiting list, which in this
     case would be five families that include a non-elderly person with disabilities.
     However, note that this action does not increase the Mainstream baseline for the
     PHA, which is solely determined by the number of special purpose vouchers
     targeted specifically for Mainstream-eligible families that were allocated to the
     PHA. In addition, those five families would not be coded Mainstream Vouchers
     “MS5” in Inventory Management System (IMS) / PIH Information Center (PIC)
     (IMS/PIC) or successor system; these families should not be reported under the
     Mainstream 5 field in the Voucher Management System (VMS). See new IMS/PIC
     coding requirements in Section 6 of this notice for additional information.

i.   Portability. If a Mainstream Voucher participant ports to another PHA and the receiving
     PHA chooses to bill the initial PHA, then the voucher will remain a Mainstream Voucher.
     If the PHA chooses to absorb the voucher, the voucher will be considered a regular
     voucher, or a Mainstream Voucher if the receiving PHA has a Mainstream Voucher
     available, and the Mainstream Voucher at the initial PHA will be freed up to lease to
     another Mainstream-eligible family.

j.   Funding. As indicated above, for the past three years (2017 through 2019),
     Mainstream Vouchers have been funded under a separate paragraph in each years’
     appropriations act. This funding covered HAP renewals, administrative fees, and new
     incremental vouchers. This paragraph is separate from the main TBRA paragraphs
     covering HCV renewals and administrative fees.

     PHAs administering the Mainstream Program can anticipate that HUD will provide
     Mainstream Program Annual HAP Renewal Award Letters, Enclosures to the letters,
     monthly HAP and administrative fee disbursement announcements, and biannual cash
     reconciliation documentation. In addition, HUD will publish guidance on HAP
     renewal funding and administrative fees in the annual PIH notice implementing the
     federal fiscal year HCV funding provisions.



                                            5
    k.      Reallocation of Funds. Funds for Mainstream Vouchers may be recaptured and
            reallocated if the PHA does not comply with program requirements or fails to
            maintain a utilization rate of 80 percent for the PHA’s Mainstream Vouchers.

6. Tracking and Monitoring:

   a.      IMS/PIC Reporting.

          i.    Form HUD-50058 and Form HUD-50058 MTW – PHAs must submit a form HUD-
                50058 (or form HUD-50058 MTW) to IMS/PIC or successor system for all
                transactions, including Voucher Issuance (action code 10), Voucher Expiration (action
                code 11), and End of Participation (action code 6). For a full list of required actions, see
                the Form HUD-50058 Instruction Booklet. Submission of all required actions is
                important for HUD’s monitoring and evaluation of the Mainstream Voucher Program.

          ii.   Other Special Program field – All Mainstream families will be coded on line 2n of
                the Family Report (form HUD-50058) and on line 2p of the MTW Family Report
                as “MS5”. In cases of portability, the initial PHA must include “MS5”, as
                applicable, on the HUD-50058, Family Report sent to the receiving PHA.
                Receiving PHAs must maintain the “MS5” code on their Family Reports for the
                duration of the family’s participation in the Mainstream Voucher Program if the
                receiving PHA is billing the initial PHA. The PHA should not code more
                families than the number of Mainstream Vouchers awarded.

         iii.   Homeless at admission – PHAs must use line 4c “Homeless at admission? (Y or N)”
                of the HUD-50058 or MTW Family Report to accurately report whether the family
                being admitted to the program was homeless at the time of admission.

   b. Section Eight Management Assessment Program (SEMAP) Indicator 13 (Lease-up).
      Mainstream Vouchers, excluding all new awards for the first year, must be included in the
      utilization rate for the purposes of determining the PHA’s overall utilization under Indicator
      13. PIC’s calculation of the Lease-up indicator incorrectly excludes Mainstream Vouchers
      from consideration. The Financial Management Center (FMC) determines the Indicator 13
      utilization rate for all PHAs using VMS reported expenses and leasing and sends the
      calculations to the appropriate Field Office to distribute to the PHA. Using VMS, PHAs
      can approximate their overall utilization rate for SEMAP by adding the Mainstream 5-Year
      data to the overall HCV program data.

                   Example of how newly awarded Mainstream Vouchers are handled:

                   Effective date of new vouchers: 6/1/2018
                   First increment expiration: 5/31/2019

           The new Mainstream unit months available (UMAs) and budget authority (BA) will be
           excluded completely from the denominator for calendar year (CY) 2018 SEMAP. The
           new Mainstream UMAs and BA will also be excluded from CY 2019 SEMAP for
           January through May 2019. UMAs and BA will be counted in the utilization rate from
           June 2019 through December 2019.
                                                       6
        For the period that new Mainstream UMAs and BA are not considered for SEMAP,
        Mainstream unit months leased (UMLs) and Mainstream HAP expenses will also be
        excluded from the numerator if possible, however; if the PHA has existing
        Mainstream Vouchers at the time of the new award, all Mainstream UMLs and BA will
        be included because they cannot be separated out.

   c.   VMS Reporting. All PHAs must report all Mainstream Vouchers leased under the
        Mainstream 5-Year HAP and UML fields in the Voucher Management System. As with
        IMS/PIC reporting, PHAs must not report more Mainstream families than the established
        calendar year baseline of Mainstream Vouchers. Mainstream Vouchers that have been ported
        and are being billed to the initial PHA must be reported under the Mainstream 5-Year field. If
        the PHA chooses to absorb the voucher, the voucher will be considered a regular
        voucher and the Mainstream Voucher at the initial PHA will be freed up to lease to
        another eligible family.

        No other VMS line item will include Mainstream Voucher activity, such as Restricted
        Net Position (RNP), Unrestricted Net Position (UNP), Cash/Investment, Non-MTW
        Administrative Expenses, etc.

   d.   Financial Data Schedule Reporting. As clarified in PIH Notice 2012-21, PHAs should
        report Mainstream Vouchers under the Catalogue of Federal Domestic Assistance
        (CFDA) number 14.879 “Mainstream Vouchers” in the Financial Assessment of Public
        Housing Agencies (FASS-PH). This applies to all Mainstream Vouchers, including
        those awarded prior to 2018.

   e.   Monitoring. All Grantees will be required to cooperate with HUD, Department of
        Health and Human Services (HHS), and Centers for Medicare & Medicaid Services
        (CMS), or any contractors affiliated with HUD, HHS, and CMS in evaluating this
        program. HUD will monitor utilization, program requirements, and compliance with
        PHA’s individual NOFA application, including preference implementation and service
        offerings.

7. Partnerships and Supportive Services: The Mainstream Voucher Program NOFAs encourage
   PHAs to establish formal and informal partnerships with a variety of organizations that assist
   persons with disabilities. HUD encourages PHAs to continue developing partnerships with
   such organizations to help ensure eligible participants find and maintain stable housing. These
   partners may provide the following services:

           Coordinate outreach and referral of eligible persons that meet the PHA’s preference
            criteria;

           Assist persons with disabilities to apply to and obtain acceptance in housing
            programs, find housing, or secure home modifications and/or disability-related
            accommodations;



                                                  7
           Assist persons with disabilities to move into units, including physically accessible
            units where appropriate, on the private rental market;

           Refer, coordinate, or provide voluntary home and community-based services; and

           Provide outreach to recruit landlords to participate in the HCV program (either for
            the program as a whole or specifically for the Mainstream voucher program).

8. Contact Information: Inquiries about this notice should be directed to
   MainstreamVouchers@hud.gov.

9. Paperwork Reduction Act: The information collection requirements contained in this notice
   have been approved by the Office of Management and Budget (OMB) under the Paperwork
   Reduction Act (PRA) of 1995 (44 U.S.C 3520). In accordance with the PRA, HUD may not
   conduct or sponsor, and a person is not required to respond to, a collection of information
   unless the collection displays a currently valid OMB control number. The following active
   information collections contained in this notice have been approved under the PRA-OMB
   Control Numbers 2577-0169 and 2577-0083.




                                                           /s/
                                               R. Hunter Kurtz, Assistant Secretary
                                                for Public and Indian Housing




                                                  8