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HUD's Proposed Public Housing Operating Subsidy Formula Rule Bypasses Neg-Reg

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  Issue 27, Spring 2005

HUD's Proposed Public Housing Operating Subsidy Formula Rule Bypasses Neg-Reg

by Jim Schaafsma, MPLP Housing Law Attorney

Last year, as mandated by Congress, HUD reconvened a committee of "stakeholders" to develop, through a process called negotiated rulemaking ("neg-reg"), a new public housing operating subsidy formula that would adequately fund well-managed public housing. With limited resident involvement, this committee reached agreement on what the operating subsidy formula should be and how to make the transition to it. In developing the formula, the committee used a $3.8 billion annual figure.

Despite the rulemaking committee's proposed rule, HUD "modified the Committee's recommendations to better reflect [the] Administration's policies and budgetary priorities". Besides providing less money for public housing operations, the proposed rule that HUD issued on April 14 departs in several other significant resident unfriendly ways from the committee's proposal. To see the proposed rule, go to: http://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/05-7376.pdf

Broadly speaking, the proposed formula would reduce funding for housing agencies with the most public housing units and increase funding for smaller agencies. For more information about HUD's circumvention and rejection of the negotiated rulemaking, go to the National Low Income Housing Coalition's website, www.nlihc.org, from which most of the information in this summary was drawn.




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