betty turner

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Betty Turner

Housing 101 for New Housing 101 for New Managers and Managers and DirectorsDirectors

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Today’s TopicsToday’s Topics

How a housing authority operates Role of Congress, HUD, and local

government The role of the board and working well

with the board Strategic management of housing

authority programs - HCV and PH…

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Today’s TopicsToday’s Topics

HCV – Lease-up and utilization PH – asset-based management and AMP

performance Performance assessment - SEMAP and PHAS /

Quality control Leadership and supervision The housing authority’s role in the community

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How a Housing Authority How a Housing Authority OperatesOperates

PerformancePerformance ServiceService

AccountabilityAccountability

IntegrityIntegrity ResponsibilityResponsibility

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Public Housing AuthoritiesPublic Housing Authorities

PHAs have a contractual relationship with HUD to deliver housing programs PHAs implement programs established by

Congress and regulated by HUD Must operate in accordance with HUD

regulations and funding

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Creation of a Housing AuthorityCreation of a Housing Authority

PHAs are created under state enabling legislation stipulating: Number of commissioners and procedures

for appointment or election By-laws establish term of office, how PHA is

set up (independent, branch of city govt, etc) Jurisdiction of PHA may be city, county, state

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Creation of a Housing AuthorityCreation of a Housing Authority

• A PHA is a public non-profit corporation

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ACCACC

Annual Contributions Contract is the primary contract between the PHA and HUD HUD provides money if PHA complies with

laws and regulations HUD can monitor PHA has fundamental obligations in the ACC

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History of Public HousingHistory of Public Housing

Housing Act of 1937 established the first permanent public housing program

Original purpose of 1937 legislation was to stimulate the economy and create construction jobs

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Public HousingPublic Housing

Public housing is project-based subsidy Families have to

live in the unit which has subsidy attached to it

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Public HousingPublic Housing

Public housing is owned and managed by the PHA PHA is both administrator and landlord Since PHA owns and manages rental real

estate, there are many state and local building and safety codes, landlord/tenant laws, and liability issues

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When PH is DevelopedWhen PH is Developed

When a PHA develops public housing in a city, the PHA and city execute a Cooperation Agreement Under this agreement, the PHA pays the

locality a Payment in Lieu of Taxes (PILOT) PHA is not subject to real or personal

property taxes

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Congress & HUDCongress & HUD

PHAPHA

Family

Annual Contributions Contract

LeaseLease

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History of HCVHistory of HCV

1970’s All Section 8 programs were

established except Vouchers

1980’s Housing Vouchers

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Section 8 Section 8

Voucher program is tenant-based Families may

seek suitable housing where they choose

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Congress & HUD

PHA

Family Owner

Vo

uche

r

HAP Contract

Annual Contributions Contract

Lease

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Historical Perspective of PHAsHistorical Perspective of PHAs

Brooke Amendment set rent as a percentage of income for both public housing and Section 8 Established need for subsidy

for the public housing program

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Economic Changes in the 80’sEconomic Changes in the 80’s

Housing stock deteriorated Modernization funding

needed for public housing

Section 8 certificate program greatly expanded

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Nat’l Affordable Housing Act of 1990Nat’l Affordable Housing Act of 1990

Federal preferences One Strike Voucher expansion Portability Family Self-Sufficiency PHMAP

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QHWRA (The Reform Act)QHWRA (The Reform Act)

Intent was to restore trust in housing programs; innovations in PH; promote self-sufficiency

Significantly amended the Housing Act of 1937

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Reform Act ProvisionsReform Act Provisions

Both programs New income limits for admission Mandated minimum rent and hardship

exemptions Disallowance of earned income

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Housing Choice Voucher Merged Section 8 certificate and Housing

Choice Voucher programs Portability issues increased

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Public housing Flat rent and family choice in rent Community service New criteria under PHAS Expanded screening and eviction for drug and

other criminal activity Mandated operating subsidy formula be changed

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Overview of Key RelationshipsOverview of Key Relationships

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CongressCongress

Created and continues to shape subsidized housing through laws and statutes HUD implements legislation

PHAs use these laws, statutes and regulations to define local policies

Congress establishes HUD’s budget

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HUD AdministrationHUD Administration

HUD is charged by Congress as the department to administer subsidized housing HUD contracts with PHAs who actually build,

manage, and maintain public housing and administer rent subsidy programs

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HUD HeadquartersHUD Headquarters

HUD headquarters makes decisions and disseminates information

Writes and publishes: Regulations to implement laws

Proposed, interim or final rules Handbooks and guidebooks HUD notices and memos

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HUD State and Field OfficesHUD State and Field Offices

HUD state and field offices monitor PHAs for compliance and provide technical assistance Field offices will be monitoring project-based

PHAS closely

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REAC (PIH-REAC)REAC (PIH-REAC)

Assesses PHAs under PHAS and determines level of scrutiny PHA receives Troubled PHAs are referred for intensive

technical assistance and monitoring

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References and ResourcesReferences and Resources

HUD regulations: 24 CFR Public housing: 960’s Certificates and vouchers: 982 Combined rules: Part 5 Nondiscrimination: Part 8

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How HUD CommunicatesHow HUD Communicates

The internet HUD’s site home page:

www.hud.gov HUD notices:

www.hud.gov/pih/publications/notices

http://www.hud.gov/

http://www.hud.gov/pih/publications/notices

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Local LawsLocal Laws

Public housing PHAs must also comply with all local codes

which pertain to property owners Most states and localities have landlord-

tenant laws Should seek legal counsel where HUD

requirements conflict with local or state law

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Court DecisionsCourt Decisions

Court cases sometimes set legal precedent in housing issues

PHA can minimize legal challenges by assuring PHA policies and practices are current and are applied uniformly, doing good business, and practicing nondiscrimination

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The Role of the BoardThe Role of the BoardWorking Well with the BoardWorking Well with the Board

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General Structure of a PHAGeneral Structure of a PHA

PHAs design their own organizational structure May change with management or political

changes or to accomplish new objectives The PH asset management model is driving

changes to the PHA’s organizational structure Every PHA must have an executive director

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General Structure of a PHAGeneral Structure of a PHA

Board of Commissioners

Executive Director

Staff

Policy

Administration

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BoardBoard

Board is at top of organization Operates on behalf of local government

Board’s role is determined by: Legal jurisdiction of PHA Legal structure of PHA Political environment

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BoardBoard

Local governing body may be City Council, County Commissioners, State legislature or combination

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Nature of the BoardNature of the Board

Oversees policy and hires the executive director Executive director implements policy and

hires staff

Establishes budgets Builds and maintains the PHA’s image

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Nature of the BoardNature of the Board

Board must: Provide direction in achieving common

purpose Govern the PHA’s resources Maintain, preserve, develop and expand

programs and services Ensure viability of agency

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Board ResponsibilitiesBoard Responsibilities

Board sets policy Board policy is the direction or course of

action the PHA will take with the mission Boards do not have time to manage – this is

not their role Board should monitor bottom-line results

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Board ResponsibilitiesBoard Responsibilities

Fiduciary responsibility to: Act in good faith and uphold integrity See that PHA is well managed Not to make decisions based on personal or special

interests Committed to values of organization Make hard choices about which program or service

to fund

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Board Hires EDBoard Hires ED

Executive director manages the organization

Board members should support the executive director

Board must evaluate executive director each year

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Participant on BoardParticipant on Board

Board must include one resident directly assisted by PHA Exceptions:

Board members are full-time and salaried as required by state law; or

PHA is not governed by a governing board

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Resident on BoardResident on Board

Doesn’t apply to PHA that: Has less than 300 public housing units Has provided reasonable notice to RAB for

residents to serve No resident is interested PHA outreaches to residents at least once a

year

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ED and the BoardED and the Board

ED is more than just an employee of the board Should sit at the board table at all meetings Should make well-supported

recommendations

1-15

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ED and the BoardED and the Board

Board delegates to ED the day-to-day responsibility to: Implement board policies Represent PHA in negotiations, public

relations, HUD business, public events Hire, direct, supervise, train, evaluate and

discipline staff

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Board’s Relation to StaffBoard’s Relation to Staff

Board’s only employee is the ED Employees need to understand that the ED gives

orders and that they are accountable to the ED Board hires ED to be expert in managing

personnel and the agency ED is accountable to the board for staff

performance

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Board’s Relation to StaffBoard’s Relation to Staff

Chain of command has rules… Board members have no authority to issue orders

to staff except through ED Board has no directly responsibility for assessing

staff performance Board doesn’t usually act on complaints from staff Board shouldn’t let staff “short circuit” chain of

command

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Working Well with the BoardWorking Well with the Board

The relationship between board members and the executive director define the organizational “culture” of the PHA and defines the relationship with the entire staff of the PHA and the organization as a whole

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The most important decision a board makes is the selection of the executive director

The second is the selection of the board chair

Boards and the executive director work together to accomplish the PHA’s mission

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The board also needs to understand that the executive director must be free to manage the day-to-day activities of the PHA They must understand that their role is

governance Simply stated, they set the direction of the

agency

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Remember, you work for the board, they do not work for you

The executive director has one boss, the full board

The executive director is not responsible to each board member

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The board must speak with one voice when delegating, giving direction, or asking for accountability This can be a difficult balancing act for an

executive director especially when you have strong-willed board members who think that their opinion is more important than their counterparts

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It is imperative that the executive director gives equal respect to all board members to avoid creating an environment that divides the board and results in the mission of the agency being undermined

The board chair and the executive director should have a strong, ongoing, working relationship

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What must be communicated to the board in word and deed is your willingness to do the following: Perform your duties efficiently and at the highest

degree of competence Take initiative and risks without being risky Adapt to a changing environment Make informed decisions Work as a team with staff and the board

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Be open with information about perceived or actual problems confronting the PHA

Be trustworthy Have respect for the board, staff, internal and external

customers Accept responsibility for your actions or inaction Be open to praise or criticism based on your

performance

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Executive DirectorExecutive Director

Necessary abilities of any ED are decision making, planning, and problem solving

Degree of responsibility varies with the size of the PHA and programs covered

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Executive DirectorExecutive Director

General areas of responsibility: Leader Visionary and information bearer Decision maker Manages day-to-day operations Board developer

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Strategic Management of HCV and PHStrategic Management of HCV and PH

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Strategic ThinkingStrategic Thinking

Many PHAs spend most of their time “fighting fires” – realizing and reacting to problems

Major differences between a “fighting fires” organization and a strategic organization is the skill to see the broad perspective and taking the long view

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Strategic ManagementStrategic Management

A general rule: You need to know how your programs are

doing! SEMAP, PHAS, QC – watch the trends

If your programs need improving, if trends are headed in the wrong direction, the formula is leadership, a plan, and hard work

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Another general rule: Put ethics on the front burner

Doing what’s right, fair and honest should be a corporate value, modeled at the top

It can be a challenge to know what’s right Ignorance isn’t an excuse under the law Ask, consult, and discuss if you don’t know

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The Three R’s of Ethics Respect

To people, resources, work Responsibility

To clients, co-workers, your PHA and you Results

That consider how as well as what

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Hire and promote quality directors and staff Conduct job analysis Develop job descriptions Develop performance standards – and

ensure standards through quality control Hire the best employees…

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Hire and promote quality directors and staff Train staff

Job tasks, nondiscrimination, new policies Ensure and insist on quality supervision Ensure performance evaluations are

conducted

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Strategic PlanningStrategic Planning

There are required policies that you must approve These are your PHA’s roadmaps! Your job is to ensure these policies are

comprehensive, up-to-date, and comply with HUD regulations and federal, state and local law

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Your job is to make sure that PHA practice matches policy!

Who is responsible for policy implementation?

When the Board approves new policies are staff informed and trained?

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Here are the policies you need to know: PHA Five-Year Plan and Annual Plan Admissions and Continued Occupancy Policy

(ACOP) The public housing lease Administrative Plan

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PHA procurement policy PHA personnel policy Collective bargaining agreement for

unionized agencies

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Other Policies and Records to Other Policies and Records to ConsiderConsider

Disposition policy Resident management policy Automobile Travel Capitalization policy Public records policy Insurance records

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Performance Assessment - SEMAPPerformance Assessment - SEMAP

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Purpose of SEMAPPurpose of SEMAP

SEMAP was created to: Objectively measure key areas Identify mgmt capabilities/deficiencies Improve HUD risk assessment for each

problem identification Provide self-assessment tool for PHAs

Use as a strategic management tool!

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Key Performance IndicatorsKey Performance Indicators

1. Waiting list 15

2. Reasonable Rent 20

3. Adjusted Income 20

4. UA Schedule 5

5. HQS QC 5

6. HQS Enforcement 10

7. Expanding Housing 5

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Key Performance IndicatorsKey Performance Indicators

8. Payment Standards 5

9. Annual Reexams 10

10. Correct Tenant Rent 5

11. Precontract HQS 5

12. Annual HQS 10

13. Leaseup 20

14. FSS 10

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HCV Lease-Up and UtilizationHCV Lease-Up and Utilization

More than ever, the HCV manager must be a business manager

Must monitor the lease-up for utilization

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Background The PHA enters into HAP contracts on behalf

of eligible families for the number of units reserved under ACC for at least one year

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How HUD gets lease-up count: Number of authorized units is from HUDCAPS

(HUD Central Accounting Processing System) Calculated by number of leased-up families in

PIC, minus administered port-ins, plus port-outs administered by other PHAs

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In the event a PHA has insufficient allocated budget authority to lease 98 or 95 percent of the units under ACC, HUD will consider whether the PHA has used at least 98 or 95 percent of its allocated budget authority

In other words, whichever is higher without going over – units or money

Page 2-118

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Lease-Up CautionLease-Up Caution

Meanwhile, federal law states that, in any calendar year, PHAs must not exceed their allocated unit lease up Example: A PHA allocated 1,000 units may

not have more than 12,000 Unit Months Leased (UML) in a Jan – Dec calendar year 1,000 x 12 months = 12,000 UML

Page 2-118

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SEMAP PerformanceSEMAP Performance

SEMAP certifications and ratings PIC integrates with form HUD-50058 Ratings are based on PHA certifications, PIC

data, field office reviews, and audit reports Ratings for indicators 1-7 are initially based

on PHA SEMAP certification

SEMAP Certification FormSEMAP Certification FormHUD-5264BHUD-5264B

Signed by executive director and board chairperson

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SEMAP PerformanceSEMAP Performance

HUD completes SEMAP profile and rating based on PHA’s certification

Notification letter generated by PIC SEMAP rating report available over internet HUD field office monitors

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Supervisory QC ReviewsSupervisory QC Reviews

Some indicators require supervisory audits Objective is to determine compliance with

indicator Annual samples of files drawn in unbiased

manner (leave clear audit trail) Supervisor or other qualified person other than

the one who did the work

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Supervisory QC NeededSupervisory QC NeededWaiting list 15Reasonable Rent 20Adjusted Income 20UA Schedule 5HQS QC 5HQS Enforcement 10Expanding Housing 5

Subject tomodification,

based on audit

Comes from PHA certification

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Performance Assessment – PHASPerformance Assessment – PHAS

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Purpose of PHASPurpose of PHAS

PHAS was designed by HUD to enhance public trust by creating a comprehensive oversight tool that effectively and fairly measures a PHA based on objective and uniform standards

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Four PHAS IndicatorsFour PHAS Indicators

Physical Condition 30 points Financial Condition 30 points Management Operations 30 points Resident Service & Satisfaction 10

points

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The New PHASThe New PHAS

PIH 2008-18(HA) published March 27, 2008 HUD is moving forward on project-based PHAS HUD will issue a proposed PHAS rule in Spring

of 2008 – including four scoring notices Form 5834 will be used for onsite management

reviews of projects Scoring will be in the proposed rule

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The New PHASThe New PHAS

The last PHAs to get a score under the current PHAS will be those with FYE March 31, 2008

After that, only physical condition of each project will be scored in the PHAS transition year

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The New PHAS – PIH 2008-18 FAQsThe New PHAS – PIH 2008-18 FAQs

The COCC (central office) will not be scored under financial condition – only the financial condition of each project will be measured

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Management assessment HUD will use 5834 but will utilize a “greater

delineation” between performance, compliance, and process As much as possible, performance will be

what’s scored

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Capital Fund Program Obligation and expenditure will be assessed

for each project

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Proposed PHAS BreakdownProposed PHAS Breakdown

The proposed PHAS is anticipated to be comprised of four components

PASS - 30 Points FASS - 20 Points MASS (onsite review) – 40 Points Capital Fund – 10 Points

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PHAS and Asset ManagementPHAS and Asset Management

The new operating subsidy model is a fundamental change Historically, the central office

decided how “ob sub” would be spent

Now, all money goes to the projects, and projects have to pay for everything else

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Asset and Project-Based Asset and Project-Based ManagementManagement

Two components of HUD’s new model: Project-based management is decentralized

property services tailored to the needs of each property, given the resources available to each property.

Asset management is centralized services tailored to the needs of the portfolio as a whole

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Basic Requirements of PBMBasic Requirements of PBM

The new formula: Requires PHAs with 250 or more (250-400 can

opt out for this calendar year) PH units to transition to project-based accounting, budgeting, and management

By 2011, PHAs must comply with full model

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The New Model for PHThe New Model for PH

Any service to the project not at the project will come from a cost center Every PHA will have a central office cost

center (COCC) Direct services will charge the project Some functions – waiting list, tenant services,

protective services – can be allocated to AMPs

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HUD’s TimetableHUD’s Timetable

2007 All PHAs with 250 or more PH units must be using project-based accounting

2009 HUD will consider revising the system to use actual costs

2011 All PHAs with 250 or more units must be asset-management compliant

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Compliance with Asset Compliance with Asset ManagementManagement

Best definition of compliance so far is in Notice 2006-14(HA) Guidance on

successful conversion for stop-loss agencies

Seven Criteria for Compliance Seven Criteria for Compliance with Asset Managementwith Asset Management

1. Project-based accounting Monthly operating statements for each project –

revenues and expenses vs. budget levels, including all fees from the COCC and Capital Fund

Must reasonably reflect the financial performance of each project

Sum of operating statements = total PH

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2. Project-based management Property management services are

arranged or provided in the best interest of the property considering needs, cost, and responsiveness, relative to local market standards

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3. Central office cost center (COCC) All central office fees must be reasonable COCC must operate on the allowable fees

and other permitted reimbursements from its PH and S8 programs

In other words, the COCC must support itself


4. Centralized services Centralized services that directly support

projects are funded using a fee-for-service approach or through other allowable charge-backs

Each project charged for actual services received

Must be reasonable compared to local market

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5. Review of project performance PHA systematically reviews financial,

physical, and management performance of each project, and identifies non-performing properties

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5. Review of project performance – a non-performing property has:

PHAS physical score below 70 Significant crime and drug problems Below 95% occupancy TARS that exceed 7% of monthly rent roll

…

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5. Review of project performance – a non-performing property has:

PHAS grade of “D” or below for vacant unit turnaround and work orders

Utility consumption more than 120% of agency average

Other major management problems

Turnaround = D more than 30 daysWOs = D more than 40 days

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5. Review of project performance Long-term prospects for each property:

Maintain project as is Identify capital improvements needed Dispose of property (demo, sale, etc) Conversion


6. Capital planning Physical needs assessment and a five-year

plan for each project Five-year plan needs to consider revenue

sources, market, tenancy, and project needs

PHA demonstrates commitment to long-range energy consumption reduction

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7. Risk management responsibilities related to regulatory compliance

PHA not carrying out responsibilities if: Designated troubled under PHAS Any outstanding FHEO findings or

voluntary compliance agreement not implemented…


7. Regulatory noncompliance if: No current energy audit… Outstanding IG audit findings w/no progress Not in compliance with ACOP Unsatisfactory progress under RHIIP/RIM PIC (50058) reporting rate under 95% Any other major compliance deficiency

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Bottom Line Bottom Line

PH projects have to be viable Strategic portfolio

decisions

Highly skilled staff at site Good electronic reports

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The Importance of Quality ControlThe Importance of Quality Control

Makes success measurable

Shows you early rather than late where problems are

Essential for strategic leadership and planning

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Quality ControlQuality Control

Implementing an effective QC program: Enables you to know when to take action on

performance issues Documents improvements in performance Enhances the quality of the services you

provide

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What is Quality Control (QC)?What is Quality Control (QC)?

Quality control is an important tool used by high performing organizations for: Error prevention Compliance documentation Performance documentation

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What is Quality Control (QC)?What is Quality Control (QC)?

An effective quality control program: Facilitates conversation about expectations

and performance for individuals and the organization as a whole

Enables program managers to be proactive, rather than reactive

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Why Quality Control?Why Quality Control?

Quality control can help to confirm what you already know. It can: Provide documentation that supports

recommendations you want to make Generate statistics that document staff

performance Provide valuable information on a systematic

basis to share within and outside your organization

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Why Quality Control?Why Quality Control?

QC can be even more helpful if the results are a surprise Then the results may highlight:

Problems of which you were not aware Good news about improved performance or

excess capacity

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Types of QCTypes of QC

Preventive QC stops mistakes before they happen

Periodic quality control is a basic checkup on a PHA’s performance, policies and procedures that is done annually or regularly Done by high-level policy makers

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Types of QCTypes of QC

Continuous quality control is regularly checking and analyzing information about key transactions Happens from frontline supervisors up

through the organization The challenge is in choosing key indicators

of performance

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Designing a QC ProgramDesigning a QC Program

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Designing a QC ProgramDesigning a QC Program

Where to start Before you begin it is very important to think

through: What are the outcomes you want to achieve? What would success for each outcome look like? What are the possible ways to confirm (measure)

performance in this area?

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Designing a QC ProgramDesigning a QC ProgramWhere to StartWhere to Start

Then decide: Which measures are

useful and feasible How you are going to

record the information Who needs to know

the results

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The Housing Authority’s Role in the The Housing Authority’s Role in the CommunityCommunity

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Need for Organizational ChangeNeed for Organizational Change

Includes a shift in the PHA’s mission of restructuring of operations, for example: Implementing asset management Instituting self-managed teams (at AMPs) Conducting systematic layoffs or rightsizing Developing new technologies Seeking major collaborations

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Managing ChangeManaging Change

As the organization changes: Successful change involves top management There must be a realistic plan, implemented as a

team, with frequent communication to everyone Structures will be modified

Including strategic plans, policies and procedures

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The PHA’s Role in the CommunityThe PHA’s Role in the Community

The PHA has many external relationships: Resident families Other government agencies (DHSS, Soc Sec) Community-based agencies Local city and county government Judicial system HUD

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The PHA’s Role in the CommunityThe PHA’s Role in the Community

A general rule: Work with the people doing the work!

You’ll be stronger for your collaborations Be an active partner in the community Communicate and educate Do good business and do business well

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SummarySummary

Thank you for attending!

Join us again

Slide Number #130

Upcoming Lunch ‘n’ LearnsUpcoming Lunch ‘n’ Learns

May 2 – Verification Issues May 9 – Managing PHAS May 16 – Managing SEMAP June 12 – PH Rent Calculation June 13 – HCV Rent Calculation June 20 – Ethics in Your Housing Authority