On Friday, October 5, HUD released the Operations Notice for the Expansion of the Moving to Work (MTW) demonstration program. The notice establishes the requirements for the implementation and continued operations of the MTW demonstration program pursuant to the 2016 MTW Expansion Statute. According to HUD, the guiding principles for the expansion of the MTW program are to simplify, learn, and apply; the notice describes the new framework for the MTW demonstration. Comments are due on November 19.

The 2016 Consolidated Appropriations Act (the Act) authorized HUD to expand the MTW demonstration program by adding an additional 100 high-performing public housing agencies (PHAs) over a period of seven years. The Act requires agencies to be added to the MTW demonstration by cohort and that HUD direct one specific policy change to be implemented per cohort to facilitate the evaluation of that policy. At least 50 of the new slots are reserved for PHAs that administer 1,000 or fewer aggregate vouchers and public housing units, at least 47 for PHAs that administer 1,001-6,000 aggregate vouchers and units, and no more than three that administer 6,001-27,000 aggregate vouchers and units. PHAs with over 27,000 aggregate units and vouchers are ineligible for the expanded program. Furthermore, the Act reserves five slots for agencies that have portfolio awards under RAD and authorizes HUD to designate an MTW agency and one or more adjacent public housing agencies in the same area as a regional MTW agency, making the flexibilities specified in the MTW agreement with HUD applicable to all participating PHAs.

Current MTW agencies that wish to opt out of their standard MTW agreement to join the expansion would be allowed to do so under certain criteria, but are not required to. Current MTW agencies that opt to join the expansion would not be required to implement specific policy changes associated with the MTW expansion cohorts.

The Operations Notice contains numerous changes from the two previous publications. The primary changes are as follows:

  • The term of participation has been set at 12 years from the year of designation, as opposed to ending at the end of a PHA’s Fiscal Year 2028.
  • HUD has removed the general and conditional waivers category and replaced them with an MTW waivers category which MTW agencies may implement without approval from HUD. These waivers include safe harbors, which are additional requirements beyond those specified in the activity description that the agency must follow in implementing activities without HUD approval. The MTW waivers also include specific guidance on impact analyses, hardship policies, and the applicability of waivers on elderly/disabled families.
  • The Operations Notice also includes an agency-specific waiver category that allows agencies in the MTW expansion to apply for additional waivers that are not included in the MTW waiver category, or expand an MTW waiver outside of listed the safe harbor or harbors.
  • The 90 percent voucher utilization requirement was removed. Rather, the MTW Housing Assistance Payment (HAP) Renewal Formula has been revised to use as a base. This includes all prior-year MTW-eligible Housing Choice Voucher (HCV) funding expenses paid from HAP, including HAP expenses plus non-HAP expenses.
  • The notice clarifies that an agency must be either a high performer in the Public Housing Assessment System (PHAS) or the Section Eight Management Assessment Program (SEMAP) instead of being a high performer in both.
  • Regionalization was removed the MTW Operations Notice and will be implemented through a separate forthcoming notice.
  • Agencies will formalize their MTW status with an amendment to their ACC.
  • The requirement for MTW PHAs designated through the expansion to assist substantially the same number of families has been simplified. Compliance will be determined using a baseline ratio of total public housing and HCV HAP funding to families served.

The Operations Notice further discusses the use of MTW expansion waivers, MTW funding flexibility, evaluation, program administration and oversight, and other topics.

The Operations Notice also lists the four policy cohorts that the MTW expansion will study. The first cohort will study the impact of MTW flexibility on small and medium PHAs. This cohort will be open to agencies with 1,000 combined public housing and voucher units or less, and will evaluate the overall effects of MTW flexibility on a PHA and the residents it serves. The second cohort will evaluate different rent reform models. The third cohort will evaluate work requirements for residents/participants who are non-elderly, non-disabled, and at least 18 years old. The last cohort will evaluate how to improve landlord participation in the Housing Choice Voucher program through incentives, such as participation payments, vacancy payments, alternate inspection schedules, and other methods.

HUD has noted they expect to begin accepting applications for the first and second cohorts before the end of the year. HUD will not announce agencies that are selected for the MTW expansion until the Operations Notice is fully finalized. A PHA that is not accepted for one cohort is not precluded from applying to other MTW expansion cohorts.

HUD will also be hosting a call with the MTW Research Advisory Board on October 10 at 1 p.m. ET. The meeting will discuss the work requirements cohort of the MTW Expansion. HUD is looking for feedback from the advisory committee on research design, random assignments, and specific policies. The public is invited to call in to the meeting by using the following toll-free number in the United States: (800) 230-1059, or the following International number for those outside the United States: (612) 234-9959.

The MTW Expansion Operations Notice can be found here. Comments are due November 19 at regulations.gov.

NAHRO’s comments on the previous MTW Operations Notice can be found here and here.


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