HOTMA implementation for HUD’s Community Planning and Development (CPD) programs has been a bit hazy since the publication of the HOTMA Final Rule in February of 2023. As we say farewell to 2024, HUD has cleared the air on two of the last lingering questions facing those programs.
First, CPD programs may select their own HOTMA implementation dates, no later than January 1, 2026. Second, CPD programs may utilize Safe Harbor verification provisions – to some extent.
Programs operating under CPD include:
- HOME
- HOME – American Rescue Plan (HOME-ARP)
- Housing Trust Fund (HTF)
- Emergency Services Grants (ESG)
- Continuum of Care (COC)
- Housing Opportunities for Persons with AIDS (HOPWA)
- Community Development Block Grant (CDB)
- Other Competitive Programs
Citing delays in updating HUD systems for HOTMA, HUD will allow Participating Jurisdictions (PJs), participants, and stakeholders to select a final compliance date that falls between January 1, 2024 and January 1, 2026. This will allow stakeholders more time to revise their policies and procedures and to ensure their software can accommodate new provisions.
HOTMA introduced a new, streamlined method of verification which subsidized programs could use when determining gross annual income. This safe harbor provision allows O/As and PHAs to utilize income determinations made by other, means-tested programs when determining eligibility and rent determinations in their programs. The safe harbor method was not directly aimed at CPD programs, which often have very distinctive verification requirements. This new Final Rule clarifies that, to some extent, CPD programs may pursue verification in this manner.
ESG, COC, and HOPWA may use the safe harbor provision after they have updated their program guidelines and established policies and procedures that describe the provision. HUD’s goal is to align CPD programs with Section 8 guidance, and, more specifically, to align HOPWA programs closely with the Housing Choice Voucher (HCV) program.
If a HOME- or HTF-assisted unit is receiving Federal, State, or public housing project-based subsidy, the grantee must accept the subsidy program’s determination of a family’s annual and adjusted income. If a HOME- or HTF-assisted unit is receiving tenant-based subsidy, the grantee may accept the tenant-based rental assistance provider’s determination of income. Again, the theme is to better align policies when a unit is “blended” with multiple layers of assistance. HOME and HTF providers must incorporate these new regulations into their policies, procedures, and other guidelines.
Hopefully this Final Rule breathes more clarity into HOTMA implementation as we enter a big year for compliance!