Electronic Transmission of Required Family Data for Public Housing, Indian Housing, and the Section 8 Rental Certificate, Rental Voucher, and Moderate Rehabilitation Programs

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of the Assistant Secretary for Public and Indian Housing

24 CFR Parts 813, 905, 908, and 913

[Docket No. R-95-1747; FR-3730-F-03]

RIN 2577-AB47

Electronic Transmission of Required Family Data for Public

Housing, Indian Housing, and the Section 8 Rental Certificate, Rental

Voucher, and Moderate Rehabilitation Programs

AGENCY: Office of the Assistant Secretary for Public and Indian

Housing, HUD.

ACTION: Final rule.

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SUMMARY: This rule requires all housing agencies (HAs) to submit

certain data electronically to HUD in a HUD prescribed format. For HAs

that are not already automated or who determine that automation is not

cost-effective, transmission of the data through the use of a service

bureau is permitted. Electronic transmission is necessary because the

manual submission of HUD forms has become a burden to HAs and HUD.

This rule applies to projects administered under the public

housing, Indian housing, and Section 8 Rental Certificate, Rental

Voucher, and Moderate Rehabilitation programs. A similar rule was

issued with respect to multifamily subsidized projects administered

under programs subject to the oversight of the Assistant Secretary for

Housing-Federal Housing Commissioner (58 FR 61017), which was codified

at 24 CFR part 208.

EFFECTIVE DATE: April 3, 1995.

FOR FURTHER INFORMATION CONTACT: For Technical Information--Katherine

M. Dillon, Director, Information Services Division, Office of Public

and Indian Housing, Room 4248, telephone (202) 708-5285. For Public

Housing program information--Edward C. Whipple, Director, Occupancy

Division, Office of Public and Indian Housing, Room 4206, telephone

(202) 708-0744. For Native American program information--Ed Fagan,

Office of Native American Programs, Room B-133, telephone (202) 755-

0088. These people may be reached at the Department of Housing and

Urban Development, 451 Seventh Street, S.W., Washington, D.C. 20410.

Hearing or speech-impaired individuals may call HUD's TDD number (202)

708-4594. (These telephone numbers are not toll-free.)

SUPPLEMENTARY INFORMATION:

I. Paperwork Burden

The information collection requirements contained in this rule have

been reviewed by the Office of Management and Budget (OMB) under the

Paperwork Reduction Act of 1980 (44 U.S.C. 3501-3520) and assigned

approval number 2577-0083, which expires on August 31, 1997.

II. Background

On Thursday, October 6, 1994, the Department published a proposed

rule that would require all housing agencies (HAs) to submit certain

data electronically to HUD in a HUD prescribed format.

Housing agencies have been submitting data forms to HUD for each

family assisted under the public housing, Indian housing, and Section 8

Rental Certificate, Rental Voucher and Moderate Rehabilitation

Programs. Approximately 85 percent of reporting agencies (3,655 HAs)

have been submitting paper forms. This extensive processing of paper

forms has become a burden to the HAs as well as to HUD.

To reduce the cost to the Department of processing this information

and to improve its accuracy, HUD issued the proposed rule to require

that this information be submitted electronically. The change is

expected to contribute significant savings to the Department, in a time

when budget constraints demand such savings. The time spent by HAs in

initiating electronic collection and transmission and making

corrections to the electronic data submissions will be offset by future

savings in the reexamination and reporting process, as well as

increased accuracy and speed associated with the admission,

reexamination and reporting processes, and the reduced number of HUD

adjustments and paperwork required by these adjustments.

The proposed rule requires HAs to submit data electronically via

telephone modem, rather than through tape, diskette, or paper. However,

the rule also provides that the Department may approve transmission of

the data by tape or diskette where the Department determines that the

cost of telephonic transmission would be excessive. For HAs that are

not already automated or who determine that automation is not cost

effective, the rule would permit transmission of the data through the

use of a service bureau.

In recognition of the difficulty some HAs may have in conversion to

electronic submission of data, the proposed rule permits HUD Field

Offices to grant extensions of time beyond the stated implementation

date for commencement of electronic submission under certain

circumstances.

This final rule adopts the proposed rule, as published, in its

entirety, with the addition of a reference to Indian housing programs

in Sec. 908.108(a).

III. Response to Public Comments

The Department received 16 comments on the proposed rule. The

commentors consisted of HAs and two professional housing associations.

Most respondents expressed general support for HUD's implementation of

the rule. The following are major concerns expressed by the commentors:

The most frequent category of concern was raised by small HAs (100

units or less in management), requesting that they be excluded from the

requirement [[Page 11627]] to submit family data electronically. They

stated that their size and limited staff and financial resources made

compliance burdensome, and they suggested two solutions. The first was

to discontinue the submission of data completely; the second was to

continue submission of paper reports as is currently the practice.

While the Department is aware of the unique constraints faced by

small HAs in reporting family data, they should be aware that they

constitute a sizeable portion of the HA universe and have valuable

resident family information that should be shared. HUD's position in

this matter is that small HAs unable to automate their reporting

systems should seek out, and contract with, organizations that provide

data processing services (Service Bureaus). Service costs should be

manageable, since small HAs are only required to report on a quarterly

basis. A service bureau need not be physically located in the city

where the housing agency is located, since paper records may be mailed

to a service bureau, which may then transmit the records electronically

to HUD.

Several HAs suggested that if HUD provides the software for

automating family data reporting, the requirement would be reasonable.

Along these lines, other HAs and a housing organization indicated a

willingness to send data electronically only if HUD provides equipment

and software or pays for contracting with service bureaus.

The Department is aware that there are vendors available that can

assist HAs in automating the collection and reporting of family data.

These vendors also can help HAs to achieve this automation in the

context of HA automation of other functions. The Department strongly

encourages HAs to investigate these options. HUD also is considering

development of a software package that is directed primarily for the

smaller HAs. This package would automate only the collection and

reporting of family data, not the other HA functions. This software

package would be provided free of charge. The Department will notify

HAs by letter if this software package becomes available.

The cost of automation hardware is an eligible operating expense

and can be included in the operating budget. Automating this management

function also is an allowable expense under the Comprehensive

Improvement Assistance Program and the Comprehensive Grant Program.

Another organization suggested that the Section 8 Program

Administrative Fee be increased to cover the cost of automation. In the

Section 8 Program, automation may be paid from ongoing Administrative

Fees or the Operating Reserve. The Department, however, has no plans to

increase Administrative Fees for the sole purpose of automation.

Several HAs recommended that HUD provide training and technical

assistance in the formatting and transmission of family data to the

Department's central processing facility. Plans are underway to develop

a video tape and expanded training materials specifically for this

purpose.

One organization recommended that this automation effort be more

closely coordinated with the HUD automated database program TRACS--the

data collection system used for programs administered by the Assistant

Secretary for Housing--Federal Housing Commissioner. Unfortunately, the

electronic data formats for the Forms HUD-50058 and HUD-50058-FSS,

which are used for the programs that are covered by this rule, and for

the Form HUD-50059, which are the subject of TRACS, are unique and will

not accommodate a one-for-one correspondence. While similar automation

hardware may be used to process a variety of management information

reports, software specifically designed for the above forms is

required.

A number of HAs recommended that the time periods required for the

implementation of the rule be extended in the following manner:

Automated agencies (converting to telephonic electronic

transmission) from 120 days after publication of the final rule to 12

months.

Non-automated agencies (planning to automate) from 365 days after

publication of the final rule to 24 months.

While HUD understands the obstacles and concerns facing agencies in

this automation effort, the intent of the rule is to decrease the

reporting burden for HAs while at the same time, reduce costs to the

Department in a time when budget constraints demand such savings. HUD

is of the opinion that the time frames originally set in the rule are

realistic. Special situations may be directed to the HUD Field Office

for consideration.

One HA located in a remote area of Alaska requested approval of

transmission via tape or diskette, since telephonic service was

undependable. In these instances HAs may utilize a Service Bureau or,

upon prior approval from HUD, transmit via tape or diskette.

IV. Other Matters

A. Environmental Impact

In accordance with 40 CFR 1508.4 of the regulations of the Council

on Environmental Quality and 24 CFR 50.20(o) of the HUD regulations,

the policies and procedures contained in this rule relate only to HUD

administrative procedures and, therefore, are categorically excluded

from the requirements of the National Environmental Policy Act.

B. Federalism Impact

The General Counsel, as the Designated Official under section 6(a)

of Executive order 12612, Federalism, has determined that the policies

contained in this rule will not have substantial direct effects on

states or their political subdivisions, or the relationship between the

Federal government and the states, or on the distribution of power and

responsibilities among the various levels of government. Specifically,

this rule is directed to housing agencies that operate HUD-assisted

housing, whose functions and authority remain unchanged. It merely

changes the format of data submitted to HUD to make its transmission

more accurate and efficient. It will not impinge upon the relationship

between the Federal Government and State and local governments. As a

result, the rule is not subject to review under the order.

C. Impact on the Family

The General Counsel, as the Designated Official under Executive

Order 12606, The Family, has determined that this rule does not have

potential for significant impact on family formation, maintenance, and

general well-being, and, thus, is not subject to review under the

order. No significant change in existing HUD policies or programs will

result from promulgation of this rule, as those policies and programs

relate to family concerns.

D. Regulatory Flexibility Act

The Secretary, in accordance with the Regulatory Flexibility Act (5

U.S.C. 605(b)) has reviewed and approved this rule, and in so doing

certifies that this rule will not have a significant economic impact on

a substantial number of small entities. Because this rule changes the

way in which the data is transmitted to HUD, and all costs associated

with implementation of the electronic transmission will be considered

allowable project operating costs, the rule is not expected to have a

significant economic impact.

[[Page 11628]]

E. Regulatory Agenda

This rule was not listed in the Department's Semiannual Agenda of

Regulations published on November 14, 1994 (59 FR 57632) under

Executive Order 12866 and the Regulatory Flexibility Act.

F. Catalog

The Catalog of Federal Domestic Assistance numbers for the programs

covered by this rule are 14.850, 14.855, 14.856, and 14.857.

List of Subjects

24 CFR Part 813

Grant programs--housing and community development, Rent subsidies,

Reporting and recordkeeping requirements, Utilities.

24 CFR Part 905

Aged, Energy conservation, Grant programs--housing and community

development, Grant programs--Indians, Indians, Homeownership,

Individuals with disabilities, Lead poisoning, Loan programs--housing

and community development, Loan programs--Indians, Low and moderate

income housing, Public housing, Reporting and recordkeeping

requirements.

24 CFR Part 908

Computer technology--automatic data processing, data processing,

electronic data processing, Subsidies--grant programs, Rent subsidies.

24 CFR Part 913

Grant programs--housing and community development, Public housing,

Reporting and recordkeeping requirements.

Accordingly, title 24, chapters VIII and IX, of the Code of Federal

Regulations are amended by amending parts 813, 905, and 913, and by

adding a new part 908, consisting of Secs. 908.101 through 908.112, as

follows:

PART 813--DEFINITION OF INCOME, INCOME LIMITS, RENT AND

REEXAMINATION OF FAMILY INCOME FOR THE SECTION 8 HOUSING ASSISTANCE

PAYMENTS PROGRAMS AND RELATED PROGRAMS

1. The authority citation for part 813 continues to read as

follows:

Authority: 42 U.S.C. 1437a, 1437c, 1437f, 1437n, and 3535(d).

2. In Sec. 813.109, a new paragraph (c) is added, to read as

follows:

Sec. 813.109 Initial determination, verification, and reexamination of

family income and composition.

* * * * *

(c) See 24 CFR part 908 for requirements for transmission of data

to HUD.

* * * * *

PART 905--INDIAN HOUSING PROGRAMS

3. The authority citation for part 905 continues to read as

follows:

Authority: 25 U.S.C. 450e(b), 42 U.S.C. 1437a, 1437aa, 1437bb,

1437cc, 1437ee, and 3535(d).

4. In Sec. 905.315, paragraphs (a) (2) and (3) are redesignated as

paragraphs (b) and (c), and a new paragraph (d) is added, to read as

follows:

Sec. 905.315 Initial determination, verification, and reexamination of

family income and composition.

* * * * *

(d) See 24 CFR part 908 for requirements for transmission of data

to HUD.

5. A new part 908, consisting of Secs. 908.101 through 908.112, is

added to read as follows:

PART 908--ELECTRONIC TRANSMISSION OF REQUIRED FAMILY DATA FOR

PUBLIC HOUSING, INDIAN HOUSING, AND THE SECTION 8 RENTAL

CERTIFICATE, RENTAL VOUCHER, AND MODERATE REHABILITATION PROGRAMS

Sec.

908.101 Purpose.

908.104 Requirements.

908.108 Cost.

908.112 Extension of time.

Authority: 42 U.S.C. 1437f, 3535(d), 3543, 3544, and 3608a.

Sec. 908.101 Purpose.

The purpose of this part is to require Housing Agencies (HAs) that

operate public housing, Indian housing, or Section 8 Rental

Certificate, Rental Voucher and Moderate Rehabilitation programs to

electronically submit certain data to HUD for those programs. This

electronically submitted data is required for HUD Forms HUD-50058,

Family Report, and HUD-50058-FSS, Family Self-Sufficiency Addendum.

Sec. 908.104 Requirements.

(a) Automated HAs. Housing agencies that currently use automated

software packages to transmit Forms HUD-50058 and HUD-50058-FSS

information by tape or diskette to the Department's data processing

contractor must convert to telephonic electronic transmission of that

data in a HUD specified format by June 30, 1995.

(b) Nonautomated HAs. Housing agencies that currently prepare and

transmit the HUD-50058 and HUD-50058-FSS information to HUD paper must:

(1) Complete a vendor search and obtain either:

(i) The necessary hardware and software required to develop and

maintain an in-house automated data processing system (ADP) used to

generate electronic submission of the data for these forms via

telephonic network; or

(ii) A service contract for the operation of an automated system to

generate electronic submission of the data for these forms via

telephonic network;

(2) Complete their data loading; and

(3) Begin electronic transmission by March 2, 1996.

(c) Electronic transmission of data. Electronic transmission of

data consists of submission of all required data fields (correctly

formatted) from the forms HUD-050058 and HUD-50058-FSS telephonically,

in accordance with HUD instructions. Regardless of whether an HA

obtains the ADP system itself or contracts with a service bureau to

provide the system, the software must be periodically updated to

incorporate changes or revisions in legislation, regulations,

handbooks, notices, or HUD electronic transmission data format

requirements.

(d) Service contract. HAs that determine that the purchase of

hardware and/or software is not cost effective may contract out the

electronic data transmission function to organizations that provide

such services, including, but not limited to the following

organizations: local management associations and management agents with

centralized facilities. HAs that contract out the electronic

transmission function must retain the ability to monitor the day-to-day

operations of the project at the HA site and be able to demonstrate the

ability to the relevant HUD Field Office.

(e) Notwithstanding the provisions of paragraphs (a) and (b) of

this section, the Department may approve transmission of the data by

tape or diskette if it determines that the cost of telephonic

transmission would be excessive.

[Approved by the Office of Management and Budget under control

number 2577-0083]

Sec. 908.108 Cost.

(a) General. The costs of the electronic transmission of the

correctly formatted data, including either the purchase and maintenance

of computer hardware or software, or both, the cost of contracting for

those services, or the cost of [[Page 11629]] centralizing the

electronic transmission function, shall be considered Section 8

Administrative expenses, or eligible public and Indian housing

operating expenses that can be included in the public and Indian

housing operating budget. At the HA's option, the cost of the computer

software may include service contracts to provide maintenance or

training, or both.

(b) Sources of funding. For public and Indian housing, costs may be

covered from operating subsidy for which the HA is already eligible, or

the initial cost may be covered by funds received by the HA under HUD's

Comprehensive Improvement Assistance Program (CIAP) or Comprehensive

Grant Program (CGP). For Section 8 programs, the costs may be covered

from ongoing administrative fees or the Section 8 operating reserve.

Sec. 908.112 Extension of time.

The HUD Field Office may grant an HA an extension of time, of a

reasonable period, for implementation of the requirements of

Sec. 908.104, if it determines that such electronic submission is

infeasible because of one of the following:

(a) Lack of staff resources;

(b) Insufficient financial resources to purchase the required

hardware, software or contractual services; or

(c) Lack of adequate infrastructure, including, but not limited to,

the inability to obtain telephone service to transmit the required

data.

PART 913--DEFINITION OF INCOME, INCOME LIMITS, RENT AND

REEXAMINATION OF FAMILY INCOME FOR THE PUBLIC HOUSING PROGRAM

6. The authority citation for part 913 continues to read as

follows:

Authority: 42 U.S.C. 1437a, 1437d, 1437n, and 3535(d).

7. In Sec. 913.109, a new paragraph (c) is added, to read as

follows:

Sec. 913.109 Initial determination, verification, and reexamination of

family income and composition.

* * * * *

(c) See 24 CFR part 908 for requirements for transmission of data

to HUD.

* * * * *

Dated: February 21, 1995.

Joseph Shuldiner,

Assistant Secretary for Public and Indian Housing.

[FR Doc. 95-5047 Filed 3-1-95; 8:45 am]

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