HUD Issues New Utility Allowance Notice
The U.S. Department of Housing and Urban Development (HUD) recently published HUD Notice 2015-04, changing the way utility analyses are completed by owners of Project-Based Section 8 properties. This notice can be found on HUD's website. Kentucky Housing Corporation (KHC) highly recommends that owners/agents use the two attachments included at the end of the notice as a reference, which will be beneficial when completing the analysis.
Owners of multifamily housing properties, that receive subsidy assistance and for which HUD provides a utility allowance, are required to review their property's utility allowances every year at the time of the annual adjustment of contract rents. Utility adjustments must be supported by a utility analysis. Owner certifications in lieu of a utility analysis are not permitted. HUD now requires multifamily property owners to establish baseline utility allowances for each bedroom size beginning this year and then once every third year. Please refer to the notice for more information on how to perform a baseline and the minimum samples required.
This change must be implemented for all properties with contract anniversary dates on or after Tuesday, December 19, 2015. Owners/agents must perform their upcoming utility analysis using the terms outlined in this notice and submit the information at the same time as their annual contract/funding renewal requests. At HUD's request, all rent increases and adjustments must be held until the owner submits the baseline utility allowance information to KHC.
If you have any questions, please contact Heather Johnson toll-free in Kentucky at 800-633-8896 or 502-564-7630, extension 753; TTY 711; or email [email protected].
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