Streamlining the Public Housing Admission and Occupancy Regulations

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Parts 960 and 966

[Docket No. FR-4084-P-01]

RIN 2577-AB67

Streamlining the Public Housing Admission and Occupancy

Regulations

AGENCY: Office of the Assistant Secretary for Public and Indian

Housing, HUD.

ACTION: Proposed rule.

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SUMMARY: This proposed rule will revise HUD's regulations that govern

admission and occupancy issues in the public housing program to do the

following: Remove rule text that is repetitive of statutory language

and otherwise streamline the rule; respond to relevant recommendations

of the Public and Assisted Housing Occupancy Task Force report of April

1994; implement a recent statute regarding screening of applicants for

admission and termination of tenancy; add important provisions

concerning application processing, previously found only in a

superseded Annual Contributions Contract between HUD and Housing

Agencies and in HUD Handbooks; and clarify applicability of the part.

The overall goal of this rule is to make the regulations clearer and

more concise and to implement statutory directives.

DATES: Comments due date: July 8, 1997.

The deadline for comments on the information collection

requirements is July 8, 1997, although commenters are advised that a

comment is best assured of having its full effect if it is received by

the Office of Management and Budget (OMB) within 30 days of

publication. See the Public Reporting Burden heading under the Findings

and Certifications section of this preamble regarding the information

collection burden.

ADDRESSES: Interested persons are invited to submit comments regarding

this proposed rule to the Rules Docket Clerk, Office of General

Counsel, Room 10276, Department of Housing and Urban Development, 451

Seventh Street, SW, Washington, DC 20410. Communications should refer

to the above docket number and title. Facsimile (FAX) comments are not

acceptable. A copy of each communication submitted will be available

for public inspection and copying between 7:30 a.m. and 5:30 p.m.

weekdays at the above address.

Comments on the information collections contained in the rule,

which are described in detail under the heading, FINDINGS AND

CERTIFICATIONS, must refer to the docket number and title of the

proposed rule and be sent to: Joseph F. Lackey, Jr., HUD Desk Officer,

Office of Management and Budget, New Executive Office Building,

Washington, DC 20503.

FOR FURTHER INFORMATION CONTACT: Linda Campbell, Director, Marketing,

Leasing and Management Division, Office of Public and Assisted Housing

Operations, Room 4206, Department of Housing and Urban Development, 451

Seventh Street, SW, Washington, DC 20410, telephone number (202) 708-

0744, extension 4020. (This telephone number is not toll-free.) For

hearing-and speech-impaired persons, this number may be accessed via

text telephone by dialing the Federal Information Relay Service at 1-

800-877-8339.

SUPPLEMENTARY INFORMATION:

I. Regulatory Reinvention Effort

On March 4, 1995, President Clinton issued a memorandum to all

Federal departments and agencies regarding regulatory reinvention. In

response to this memorandum, the Department of Housing and Urban

Development conducted a page-by-page review of its regulations to

determine which can be eliminated, consolidated, or otherwise improved.

HUD has determined that the regulations for 24 CFR, Part 960, Admission

To, And Occupancy Of, Public Housing, can be improved and streamlined

by eliminating unnecessary language. Throughout the part, this rule

shortens and simplifies the provisions retained.

The various subparts of part 960 currently contain their own

sections on purpose, scope, and/or applicability. The statements of

purpose and scope have been eliminated, since they were explanatory

only and the information can be provided in HUD documents other than a

rule. The applicability provisions have been consolidated into one

section in a new subpart A, which deals with general topics. All

statements of OMB approval numbers for information collection

requirements have also been consolidated in that subpart.

Sections on tenant selection policies and standards for tenant

selection criteria (Secs. 960.204 and 960.205) have been streamlined

and consolidated into one section (new Sec. 960.201) entitled,

``Applicant admission policies.'' Examples have been removed, since

they can be provided in HUD guidance documents.

References in the codified rule to reserved subparts and sections

have been removed, to eliminate confusion.

A number of the changes made in this proposed rule increase the

flexibility of housing agencies (``HAs'') administering the program.

For example, Sec. 960.206 now explicitly authorizes HAs to verify

information about an applicant's disability to determine appropriate

accommodations, to verify information relative to qualification for a

preference, and to determine deductions for calculating adjusted

income. It clarifies that the HA makes the final determination of

whether an applicant's failure to meet the HA's tenant selection

criteria is outweighed with respect to these issues. Another example is

the explicit authorization for HAs to adopt income limits for continued

occupancy, found in Sec. 960.210. This responds to the desire of many

HAs to adopt reasonable limits to avoid housing families who can obtain

housing on the private market. In addition, language was removed from

Sec. 960.208 that required a tenant's approval for direct payment of a

utility reimbursement to a utility provider (see discussion below).

II. Statutory Change and Related Change to Bar Admission of Certain

Evicted Tenants

The statutory foundation for the public housing program is the

United States Housing Act of 1937 (42 U.S.C. 1437a, et seq., ``1937

Act''). On March 28, 1996, that Act was amended by the Housing

Opportunity Program Extension Act of 1996 (Pub. L. 104-120, 110 Stat.

834) (``Extender Act''). It makes ineligible for admission to public

housing those individuals who have been evicted from housing assisted

under the 1937 Act (including Section 8 assistance) for drug-related

criminal activity for a three-year period, unless the evicted tenant

has successfully completed a rehabilitation program or the

circumstances leading to the eviction no longer exist.

The statute also requires HAs to prohibit occupancy in any public

housing dwelling unit by any person who the HA determines is illegally

using a controlled substance, or whose pattern of illegal use of a

controlled substance or pattern of alcohol abuse would interfere with

the health, safety, or right to peaceful enjoyment of the premises by

other residents of the project. In this connection, the statutory

amendment authorizes the housing agency administering the program to

determine whether an applicant has

[[Page 25729]]

been rehabilitated from drug or alcohol abuse.

The amendment also provides some specific requirements about the

administration of this applicant screening authority: (1) It requires

law enforcement agencies to provide information to housing agencies

concerning criminal convictions for purposes of applicant screening,

lease enforcement, and eviction; (2) it requires the housing agency to

provide anyone adversely affected by report of a criminal record an

opportunity to dispute the accuracy and relevance of that record before

any adverse action is taken; and (3) it requires that reports of

criminal records be maintained confidentially. The first of these

changes is not the subject of this rule but is the subject of current

intergovernmental coordination efforts. The second and third changes

are being implemented through revisions of the verification procedures

contained in the section now designated as Sec. 960.206(e).

A. Ineligibility of Persons Previously Evicted

This rule interprets the statute's ban on admission of a person

previously evicted for drug-related criminal activity for three years

to be a period of at least three years. Thus, an HA can determine the

period of time it believes reasonable for particular types of drug-

related activity, as long as that period is at least three years long.

This rule also proposes a related change in Sec. 960.201 to make

tenants evicted from housing assisted under the 1937 Act for serious

lease violations ineligible for admission to public housing for an

appropriate period of time. For example, families evicted for

committing crimes against persons or property, and other acts that

affect the health, safety or right to peaceful enjoyment of the

premises by other residents, would be barred from admission to public

housing for a specified period. These proposals will facilitate HUD and

HA efforts to crack down on crime and to impose tougher expectations on

federally assisted tenants, holding them responsible for their actions.

It is noted that in order to determine the eligibility of an

applicant under this proposed rule, an HA needs to know whether the

applicant was evicted from housing assisted under the 1937 Act and

whether the eviction involved drug-related criminal activity. HUD is

specifically requesting public comment on the best means to obtain

information on evictions from privately owned assisted projects and

ways HAs can share this information with each other.

B. Ineligibility of Persons Involved in Drug or Alcohol Abuse

The Extender Act requires that HAs prohibit occupancy in public

housing by any person engaged in illegal use of a controlled substance

or any person that the HA has reasonable cause to believe is engaged in

a pattern of illegal use of a controlled substance or abuse (or a

pattern of abuse) of alcohol that ``may interfere with the health,

safety, or right to peaceful enjoyment of the premises by other

residents of the project.'' This rule implements that provision by

requiring HAs to establish screening criteria to prevent admission of

such ineligible persons and by requiring HAs to establish standards for

evicting tenants related to illegal drug use and alcohol abuse. (See

Secs. 960.201(c)(1).) Since the Extender Act makes these same standards

the basis for termination of tenancy as well as for denial of

admission, this rulemaking revises the provisions of current

regulations pertaining to grounds for termination of tenancy,

Sec. 966.4(l), to add them.

In addition, consonant with the Department's overall efforts to

make public housing safe and following the pattern of Section 8

regulations (Sec. 982.553), this proposed rule provides that the HA may

deny admission or evict a tenant at any time if the HA determines that

any family member has engaged in drug-trafficking or violent criminal

activity. (Definitions of these terms are added to the rule.)

C. Criminal Background Checks

The rule currently requires, at Sec. 960.206(a), that ``[a]dequate

procedures must be developed to obtain and verify information with

respect to each applicant.'' It also suggests as sources of information

``parole officers, court records, drug treatment centers, clinics,

physicians or police departments where warranted by the particular

circumstances.'' That section is being revised to provide, at paragraph

(c)(1), that verification procedures include a ``criminal background

check of all adult household members to identify any recent history of

crimes of physical violence to persons or property and other activities

that would adversely affect the health, safety or welfare of others.''

The enactment of the Extender Act makes it clear that Congress

wants applicants who are admitted to public housing to be carefully

screened for criminal and antisocial behavior, so that public housing

developments will be more desirable places to live. HUD concludes that

HAs must carefully screen applicants to assure that they are carrying

out the new statutory provisions making ineligible for admission

persons involved in drug use and alcohol abuse or previously evicted

for drug-related activity and requiring that law enforcement agencies

make available information about criminal records.

To assure that screening is thorough and is not conducted in a

discriminatory way, the proposed rule provides that HAs must do a

criminal background check on all adult household members of each

applicant family. The rule requires HAs to access an individual's

criminal history records from a local, State, or Federal government

entity with law enforcement responsibility. The type of criminal

background check done is left to the discretion of the HA, based on

local circumstances.

This approach was discussed at a meeting in the summer of 1996 with

representatives of housing agency officials (National Association of

Housing and Redevelopment Officials, Council of Large Public Housing

Authorities, and Public Housing Authority Directors Association).

Although there was not unanimous support for this position among those

officials, the Department has determined that benefits will outweigh

the costs, as described below, and that the policy should be

implemented. Of course, public comments are invited on this subject, as

on other elements of this proposed rule.

When considering what type of check to do, an HA may consider

factors described in this rule preamble. Local and county records,

which may contain records of misdemeanors, as well as felonies, are

generally available free or for only a small fee. This type of

background check may be appropriate for long-term residents of the

locality or county. State records are available, for fees that vary

widely, and may be appropriate to check on the background of an

applicant that has moved from other localities within a State. In some

parts of the country, states have created networks through which HAs

can access criminal records from all participating states through one

request.

Another possible source is the National Crime Information Center

(NCIC), which provides information about felonies and many

misdemeanors. At this point, most HAs do not have access to NCIC

records, but HUD is working with other Federal agencies to develop

procedures so that this option can be pursued where it is deemed

appropriate.

[[Page 25730]]

A large number of HAs have residency preferences (including New

York, Puerto Rico, and Chicago--administering a total of 284,000

units), which, combined with long waiting lists, result in admission

primarily of local residents, or those who work in the locality.

Background checks on local residents can often be done through local,

county, or State systems. In the HAs that have residency preferences,

non-local residents rarely reach the top of the waiting list and the

stage of screening that involves the criminal background check.

The range of effort an HA undertakes may vary from having the

applicant get a document from the local police department or sheriff's

office that indicates whether or not the applicant has a criminal

record, and the nature of any such record, to having the applicant

fingerprinted and checking these prints and other pertinent data with

the NCIC. The former method has the advantage that applicants who know

they have a criminal history may choose to withdraw their applications,

thus screening themselves out of the applicant pool. The cost may range

from nothing, to $1 for a name check with local authorities using a

diskette for computerized access, to $10 for a name check with NCIC, to

$25 for a fingerprint check with NCIC. In no event will the applicant

be charged to cover the cost of the criminal background check.

The cost to HAs, in the aggregate, to conduct the required

background check, which many are already doing under the existing

regulations, is estimated as follows. There are approximately 1.3

million public housing households. Of these, there is turnover in 13%

of the units each year, producing a need to do applicant screening to

fill 169,000 units per year. Considering that criminal background

checks will be done on the adults in applicant households that have

already passed other standard screening procedures, it is likely that

1.5 households will be checked for each of the 169,000 admissions. That

results in 253,000 households being checked. At an average of 1.2

adults per household, the requirement to check all adult members of an

applicant household would require 303,600 individuals to be checked.

We estimate that 95% of these criminal background checks could be

done at the local, county, or State level. The cost of this type of

check varies widely, from about $1 to more than $15. Using a relatively

high estimate of approximately $10 per person, the total annual cost

for this category of background check would be $2,884,200. Another 3%

of the checks would probably be done through a name check with the

NCIC, at a ballpark estimate of $10 per person--for a total cost of

$91,080. The last 2% would be checked via the fingerprint check with

the NCIC, at an approximate cost of $25 (not including the cost of

obtaining the applicant's fingerprints)--for a total cost of $151,800.

Altogether, the cost then would be $3,127,080.

The HAs cover the cost of all their screening activities, as well

as the cost of other operations, such as evictions, through HUD

operating subsidy and rental and other income. If an HA does not

properly screen applicants, both tangible and intangible costs will be

incurred. The tangible costs to the HA will include the cost of

evicting a tenant involved in criminal activity.

Costs associated with an eviction, if the HA uses its own counsel,

are estimated to be in the range of $450 to $700 for each eviction,

provided there is no appeal. If there is an appeal or a jury trial, the

HA is likely to spend, at a minimum, $2,000 per eviction. These

estimates do not include the HA staff time devoted to documentation of

problems with the tenant family that takes place before the

commencement of an eviction action.

The cost of doing adequate screening at the point of admission (at

$1-$25 per adult) is an investment in effective management of public

housing developments. Lease enforcement--via eviction--is much more

costly. Using the high estimate of $25 per adult, the cost per

household of universal adult screening is $30, which compares very

favorably with an eviction cost of $450 to $2,000.

The intangible costs associated with failing to do adequate

criminal background checks would include the effect on neighbors in the

development whose peaceful enjoyment of the premises would be impeded

by the presence of tenant families involved in criminal activity. These

neighbors' dissatisfaction with the development might produce an

undesirable image for the development and increased turnover and

vacancies in the development. Of course, such turnover would result in

costs for cleaning units and additional applicant screening to fill the

units, and if units could not be filled because of a negative image of

the development, loss in rental income resulting from vacancies.

Complaints to the HA staff about tenants who might have been prevented

from being admitted if a criminal background check had been completed

would require staff to devote time to meet with affected families to

attempt to resolve the situation, as well as action necessary to evict

the families whose illegal activities could not be terminated by any

other means.

The Department concludes that, in fulfillment of the statutory

mandate to screen applicants to prevent admission of those who are

involved in illegal drug use and drug-related criminal activity or who

have been evicted previously for such activity and to terminate the

tenancy of persons whose use of illegal drugs or abuses of alcohol

interferes with the use of the premises by other residents, applicants

must be screened for criminal activity. Considering the costs

associated with criminal background checks and the tangible and

intangible costs of failure to do adequate criminal background checks,

the Department has determined that requiring such checks on all adults

in applicant households before admission of a family is justified as a

means of satisfying the statutory objective.

III. Annual Contributions Contract and Handbook Provisions

The Department revised the standard contract between it and housing

agencies, called the Annual Contributions Contract (``ACC''), in the

July 1995 revision streamlining and replacing the November 1969

version. The 1969 standard ACC contained requirements that are no

longer found in the new ACC but are still to be kept in force.

Therefore, this rule is adding to part 960 some requirements formerly

found in the ACC, or in HUD Handbooks, on the subject of applications,

waiting lists, and tenant selection and assignment.

A new subpart C requires HAs to obtain a written application from

each applicant, and it builds on the framework established in 24 CFR

1.4 for tenant selection and assignment plans and use of waiting lists.

IV. Occupancy Task Force

In 1993, the Secretary established a task force to review all

rules, policy statements, handbooks, technical assistance memoranda,

and other relevant documents issued by the Department on the standards

and obligations governing residency in federally assisted housing, to

comply with Section 643 of the Housing and Community Development Act of

1992 (42 U.S.C. 13603).

This task force was comprised of individuals representing the

interests of owners, managers, and tenants of federally assisted

housing, HAs, owner and tenant advisory organizations, persons with

disabilities and disabled families, organizations assisting homeless

individuals, and social

[[Page 25731]]

service, mental health and other nonprofit servicers and providers who

serve federally assisted housing. Members of the task force were

directed to review all existing standards, regulations, and guidelines

governing occupancy and tenant selection policies in federally assisted

housing, as well as lease provisions and other rules of occupancy for

federally assisted housing, to determine whether the standards,

regulations and guidelines provide sufficient guidance to owners and

managers of federally assisted housing to:

(1) Develop procedures for preselection inquiries sufficient to

determine the capacity of the applicants to comply with reasonable

lease terms and conditions of occupancy;

(2) Use leases that prohibit behavior which endangers the health

and safety of other tenants or HA employees or violates the rights of

other tenants to peaceful enjoyment of the premises;

(3) Assess the need to provide, and appropriate measures for

providing, reasonable accommodations required under the Fair Housing

Act and Section 504 of the Rehabilitation Act of 1973 for persons with

various types of disabilities; and

(4) Comply with civil rights laws and regulations.

The task force made the necessary review, conducted several public

hearings across the country, and received written comments. As

mandated, the task force submitted to the Secretary and Congress a

final report on April 7, 1994 that set forth the task force's

recommendations for occupancy criteria in federally assisted housing,

standards for the reasonable performance and behavior of tenants of

federally assisted housing, compliance standards consistent with the

reasonable accommodation of the requirements of the Fair Housing Act

and section 504 of the Rehabilitation Act of 1973, standards for

compliance with other civil rights laws, and procedures for the

eviction of tenants not complying with such standards consistent with

sections 6 and 8 of the 1937 Act.

Some of the recommendations were directed to the Congress, and

others would require the appropriation of funds for their

implementation. Those recommendations are not covered by this proposed

rule.

Most of the remaining recommendations do not require implementation

through the rulemaking process but rather through the promulgation of

guidance. The Department is committed to minimizing the regulatory

burden on the housing agencies. As a result, the only recommendations

that are covered in this proposed rule are those related to 24 CFR part

960 that require an explicit, enforceable requirement on the HAs or for

which the existing regulation must be modified to be consistent with

Task Force recommendations. The Department intends to address and adopt

other Task Force recommendations in future revisions of other

regulations, such as 24 CFR part 966, covering leases and grievance

procedures, and in future training.

The Task Force recommended that HUD provide broader coverage with

respect to requiring that HAs provide reasonable accommodations to

applicants whose applications would be denied, considering what

accommodations could be provided that would permit the applicants to

comply with program requirements. The revised Sec. 960.206 addresses

this issue.

The Task Force recommended that HUD require all housing providers

to ask all applicants at the point of initial contact whether they need

another form of communication other than plain language paperwork. Some

alternatives recommended were providing sign language interpretation;

having material explained orally by staff, either in person or by

phone; providing large type materials; offering information on tape; or

having some third party representative (a friend, relative or advocate,

named by the applicant) accompany the applicant to receive, interpret

and explain housing materials and be present at all meetings and

discussions. The Department has decided to require that applicants be

informed of alternative forms of communication that can be used, upon

the request of an applicant. The provision (in Sec. 960.207) is worded

in the form of providing information to applicants instead of asking

applicants what they need, to respect their privacy.

The Task Force recommended that HUD require housing providers to

include in all letters rejecting applicants a notice asking applicants

with disabilities who are being rejected to request an interview to

determine whether a reasonable accommodation would enable them to

comply with essential lease provisions. This recommendation has been

accepted and embodied in the same section.

V. Description of Specific Changes

A. General

The entire part has been rewritten, instead of amending some of the

existing parts. The new subpart A describes the applicability of the

part, clarifying a possible confusion about what leased housing

projects are covered--units leased by the HA from a private owner and

then subleased to tenants under the Section 23 or the Section 10(c)

programs are covered. This subpart also describes the authorization for

information collections.

B. Subpart B--Admission, Rent, and Reexamination of Income

When the rule governing Federal preferences was issued, on March 6,

1996, it removed Sec. 960.203 covering nondiscrimination requirements

when it added a provision (Sec. 5.410(i)) imposing the requirements

with respect to administration of selection preferences. However, the

scope of that provision did not clearly apply to all tenant selection

and occupancy determinations made by an HA. Therefore, this rule

restores a Sec. 960.203 to apply those nondiscrimination provisions to

all such activities. To minimize repetition of lists of statutory

references in its rules, the Department cross-references the list

already stated in that rule.

While that change restores language previously removed, another

change to this subpart eliminates reference to utility reimbursements,

in Sec. 960.208. Utility reimbursements are payments to, or on behalf

of, tenants who pay their own utility bills in cases where the utility

allowance applicable to their unit exceeds their payment for rent,

based on their income. Currently, six percent of the total population

of public housing residents have a utility allowance that is greater

than their payment for rent (``total tenant payment'' under 24 CFR part

5). These households are, therefore, entitled to receive a utility

reimbursement. This means that HAs currently send out approximately

75,000 checks monthly to tenants, if tenants have not consented to

direct payment to the utility company.

The method of paying utility reimbursements is now covered in both

part 960 and the rule defining income that is applicable to the public

housing program, now found in 24 CFR part 5 (a broader rule applicable

to all programs administered under the 1937 Act). The current

provisions require that before an HA can pay a utility reimbursement

directly to the utility company, it must obtain the consent of the

tenant.

This proposed rule eliminates reference to utility reimbursements

from part 960, so that treatment of these reimbursements will be

covered in only one part. The final rule based on this proposed rule

will include a revision to the income reimbursement provision in part 5

to permit an HA, with the consent

[[Page 25732]]

of the utility company--but without obtaining consent of the tenant--to

pay the reimbursement directly to the utility company on the tenant's

behalf. This change is intended to assure that the funds are used for

their intended purpose and to save HAs money by consolidating the

number of utility reimbursement checks they must issue from several to

one. The Department believes that the change will have no adverse

impact on tenants, but specifically invites public comments on this

change.

As mentioned above with respect to Task Force recommendations,

Sec. 960.207 has been significantly revised. The title reflects that

change. It is no longer ``Notification to Applicants'' but is

``Communication With Applicants.''

With respect to reexamination of family income and composition,

Sec. 960.209, the rule is being revised to provide that the HA shall

prescribe the conditions under which changes in circumstances between

annual reexaminations must be reported.

C. Subpart C--Applications, Waiting List, Tenant Selection and

Assignment

This subpart prescribes requirements for waiting lists and tenant

selection and assignment policies adopted pursuant to 24 CFR

1.4(b)(2)(ii). Section 1.4 requires HAs to use a community-wide waiting

list, but permits HAs to seek an exception from this requirement where

the exception would be consistent with title VI of the Civil Rights Act

of 1964, 42 U.S.C. 2000d-1, and the purposes of 24 CFR part 1.

In the waiting list section of this rule, Sec. 960.303,

clarification is given that HAs may divide their waiting list into

separate categories for general occupancy projects, for mixed

population projects, for projects designated for elderly families, and

for projects designated for disabled families, provided that all

applicants are given an opportunity to be on the waiting list for any

category of project for which they are qualified. This provision is

intended to permit operation of projects that were previously approved

as projects designated for elderly and disabled families in accordance

with their designation, while permitting families eligible for that

housing to also seek admission to other projects.

The tenant selection and assignment provisions of 24 CFR 1.4 have

been augmented in Sec. 960.304 by a provision that explicitly permits

an HA to deal with an applicant who refuses offered units a prescribed

number of times by removing the applicant from the waiting list

entirely. This additional option provides an HA with greater

flexibility in administering its program. This new section also

specifies that the number of offers to be given an applicant before

such action shall not exceed three. Of course, the HA's tenant

selection and assignment plan remains subject to HUD review, in

accordance with 24 CFR 1.4.

The provisions concerning a preference for elderly families and

disabled families in mixed population projects now found in subpart D

of part 960 are consolidated into one section (Sec. 960.307) in this

subpart.

D. Subpart D--Exemption From Eligibility Requirements for Police

Officers and Other Security Personnel

This subpart permits the admission to public housing of police

officers and other security personnel, who are not otherwise eligible

under any other admission requirements, under a plan submitted by a

housing agency (HA) and approved by the Department, to increase their

visible presence to serve as a deterrent to criminal activity in and

around public housing.

VI. Findings and Certifications

A. Public Reporting Burden

The information collection requirements contained in this rule, as

described in Secs. 960.201, 960.206, 960.207, 960.209, 960.301,

960.303, 960.304, and 960.405 are being submitted to the Office of

Management and Budget for review under the Paperwork Reduction Act of

1995 (42 U.S.C. 3501-3520).

1. In accordance with 5 CFR 1320.5(a)(1)(iv), the Department is

setting forth the following concerning the proposed collections of

information:

(a) Title of the information collection proposal: Public Housing

Admission and Occupancy Policies.

(b) Summary of the collection of information: The information

collected covers the following: (1) Policies on applicant admission,

including procedures for selection of applicants, verification of

applicant data and criminal history records, communication with

applicants, maintenance of waiting lists, and tenant selection and

assignment; (2) provision for reexamination of family income; and (3) a

plan for housing security officers.

(c) Description of the need for the information and its proposed

use: The information collected is needed to monitor compliance with HUD

public housing program requirements authorized by statute to assure

that sound management practices will be followed in the operation of

the projects, consistent with the obligations of the HAs under the

United States Housing Act of 1937, 42 U.S.C. 1437, et seq.

(d) Description of the likely respondents, including the estimated

number of likely respondents, and proposed frequency of response to the

collection of information: The likely respondents are the approximately

3,300 HAs that administer public housing units. The information is

collected only once, unless an HA changes its policy.

(e) Estimate of the total reporting and recordkeeping burden that

will result from the collection of information: The total number of

burden hours for this collection of information is estimated to be

344,800 hours, including the time for reviewing instructions, gathering

and maintaining the data. The actual burden to HAs is minimal, since

the collections are already a part of the day-to-day operation of the

HAs. The only collections actually sent to HUD are those described in

Sec. 960.201 (Applicant Admission Policies), in Sec. 960.304 (Tenant

Selection and Assignment Plan) and in Sec. 960.405 (Plan Standards and

Criteria for Admission of Police Officers). All other collections are

developed and maintained at the HA. It is difficult to determine a cost

per hour due to the different organizational structure of HAs and the

various collections being performed by different individuals. No

outside consultation was necessary to ascertain data collection

requirements. The information is not reported to the Department on a

form.

[[Page 25733]]

Reporting Burden

----------------------------------------------------------------------------------------------------------------

Est. ave.

Type of collection Proposed section of 24 CFR Number of Frequency response Annual

affected respondents of response time (hrs.) burden hrs.

----------------------------------------------------------------------------------------------------------------

Policies on Applicant 960.201, 960.206, 960.207, 3,300 1 68 224,400

Admission. 960.209, 960.304

Procedures for Applications & 960.301, 960.303 3,300 1 36 118,800

Waiting Lists.

Submission of Plan to Exempt 960.405 800 1 2 1,600

Police Officers from

Eligibility Requirements.

---------------------------------------------------------------------------------

Total Burden.............. ............................ ........... ........... ........... 344,800

----------------------------------------------------------------------------------------------------------------

2. In accordance with 5 CFR 1320.8(b)(3), the Department makes the

following statement:

The reason for collecting the information is to permit housing

agencies to collect necessary information from program applicants to

determine their eligibility for participation in the program, and to

permit HUD to monitor housing agencies' activities. HUD uses the

information it collects to ensure that the policies and procedures

adopted by the housing agencies in administration of the public housing

program are consistent with requirements of the authorizing legislation

and applicable nondiscrimination laws. The information submitted to HUD

is public information and does not lend itself to confidentiality.

Information submitted to a housing agency in the verification of

applicant data is not public information and is subject to statutory

requirements concerning confidentiality (42 U.S.C. 1437d(q)(4)). In

accordance with the Paperwork Reduction Act, HUD may not conduct or

sponsor, and a person is not required to respond to, a collection of

information unless the collection displays a currently valid OMB

control number.

3. In accordance with 5 CFR 1320.8(d)(1), the Department is

soliciting comments from members of the public and affected agencies

(see DATES and ADDRESSES sections above) concerning the proposed

collection of information to:

(a) Evaluate whether the proposed collection of information is

necessary for the proper performance of the functions of the agency,

including whether the information will have practical utility;

(b) Evaluate the accuracy of the agency's estimate of the burden of

the proposed collection of information;

(c) Enhance the quality, utility, and clarity of the information to

be collected; and

(d) Minimize the burden of the collection of information on those

who are to respond; including through the use of appropriate automated

collection techniques or other forms of information technology, e.g.,

permitting electronic submission of responses.

B. Impact on Small Entities

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

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

doing certifies that this rule will not have a significant economic

impact on a substantial number of small entities. This proposed rule

would amend occupancy and tenant selection policies in the Public

Housing program. The Department recognizes that uniform application of

requirements on entities of differing sizes may place a

disproportionate burden on small entities. Therefore, the Department

invites small entities to suggest alternatives ways of compliance with

the basic provisions of this proposed rule about how they might comply

in a way less burdensome to them.

C. Environmental Impact

This proposed rulemaking does not have an environmental impact.

This proposed rulemaking simply amends an existing regulation by

consolidating and streamlining provisions and does not alter the

environmental effect of the regulations being amended. A Finding of No

Significant Impact with respect to the environment has been made in

accordance with HUD regulations in 24 CFR part 50 that implement

section 102(2)(C) of the National Environmental Policy Act of 1969 (42

U.S.C. 4332).

D. 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 proposed rule do not have significant impact on

States or their political subdivisions, or the relationship between the

Federal Government and State and local governments, or on the

distribution of power and responsibilities among the various levels of

government. As a result, the proposed rule is not subject to review

under the Order. The proposed rule merely streamlines existing

regulations and implements certain statutory requirements with respect

to admission and occupancy of housing funded by the Federal Government

but administered by local entities.

E. Impact on the Family

The General Counsel, as the Designated Official under Executive

Order 12606, The Family, has determined that this proposed rule will

not have the potential for significant impact on family formation,

maintenance, or general well-being, and thus is not subject to review

under the Order.

F. Unfunded Mandates Reform Act

The Secretary, in accordance with the Unfunded Mandates Reform Act

of 1995, 2 U.S.C. 1532, has reviewed this proposed rule before

publication and by approving it certifies that this proposed rule does

not impose a Federal mandate that will result in the expenditure by

State, local, and tribal governments, in the aggregate, or by the

private sector, of $100 million or more in any one year.

G. Regulatory Review

This proposed rule was reviewed by the Office of Management and

Budget under Executive Order 12866, not on the basis of impact in

excess of $100 million but on the basis of its importance. Any changes

made in this proposed rule as a result of that review are clearly

identified in the docket file for this proposed rule, which is

available for public inspection in the HUD's Office of the Rules Docket

Clerk, Room 10276, 451 Seventh Street, SW., Washington, DC 20410-0500.

Catalog

The Catalog of Federal Domestic Assistance number for the program

affected by this proposed rule is 14.850.

[[Page 25734]]

List of Subjects

24 CFR Part 960

Aged, Grant programs--housing and community development,

Individuals with disabilities, Reporting and recordkeeping

requirements, Public housing.

24 CFR Part 966

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

Accordingly, in title 24 of the Code of Federal Regulations, parts

960 and 966 are proposed to be amended as follows:

1. Part 960 is revised to read as follows:

PART 960--ADMISSION TO, AND OCCUPANCY OF, PUBLIC HOUSING

Subpart A--General

Sec.

960.101 Applicability.

960.105 Approved information collections.

Subpart B--Admission, Rent, and Reexamination

960.201 Applicant admission policies.

960.203 Nondiscrimination requirements.

960.206 Verification procedures.

960.207 Communication with applicants.

960.208 Rent.

960.209 Reexamination of family income and composition.

960.210 Continued occupancy limits.

Subpart C--Applications, Waiting List, Tenant Selection, and Assignment

960.301 Applications.

960.303 Waiting lists.

960.304 Tenant selection and assignment.

960.307 Mixed population projects.

Subpart D--Exemption From Eligibility Requirements for Police Officers

and Other Security Personnel

960.401 Exemption from eligibility requirements.

960.402 Definitions.

960.405 Plan standards and criteria.

960.409 Special rent requirements and other terms and conditions.

960.411 Applicability of the annual contributions contract; effect

on the Performance Funding System.

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

Subpart A--General

Sec. 960.101 Applicability.

This part is applicable to all dwelling units assisted under the

1937 Act in projects owned by or leased to HAs and leased or subleased

by HAs to tenants, including Section 23 and Section 10(c) leased

housing projects directly operated by the HA. This subpart is not

applicable to the Low-Rent Housing Homeownership Opportunities Program

(Turnkey III); to the Indian Housing Rental, Turnkey III and Mutual

Help Homeownership Opportunities Program; or to units assisted under

Section 8 of the 1937 Act, 42 U.S.C. 1437f.

Sec. 960.105 Approved information collections.

The following sections of the part have been approved by the Office

of Management and Budget in accordance with the Paperwork Reduction Act

of 1995 and assigned the OMB approval number indicated:

------------------------------------------------------------------------

Approval No. Sections

------------------------------------------------------------------------

2577-............................ 960.201, 960.206, 960.207, 960.301,

960.303, 60.304, and 960.405

2577-............................ 960.209

------------------------------------------------------------------------

Subpart B--Admission, Rent, and Reexamination of Income

Sec. 960.201 Applicant admission policies.

(a) General. The HA must admit to public housing only families that

are qualified for admission, as follows:

(1) They are eligible in terms of income, family composition and

citizenship or immigration status;

(2) Their past behavior indicates that they can be reasonably

expected to comply with the lease;

(3) No family member has been evicted from housing assisted under

the 1937 Act for drug-related criminal activity during a reasonable

time period specified by the HA, which is not less than three years

from the date of the eviction. Notwithstanding the immediately

preceding sentence, the HA may, in its discretion, determine that the

family is eligible for admission if the HA determines that the evicted

family member who was engaged in drug-related criminal activity has

successfully completed a rehabilitation program approved by the HA or

that the circumstances leading to the eviction no longer exist (e.g.,

the evicted family member involved in drugs is no longer in the

household because of incarceration); and

(4) No family member has been evicted from housing assisted under

the 1937 Act for other serious violations of the lease during a

reasonable time period specified by the HA, unless the HA determines

that the circumstances leading to the eviction no longer exist.

(b) Criminal activity by family members. At any time, the HA may

deny admission to an applicant if the HA determines that any family

member has engaged in drug-trafficking or violent criminal activity.

For purposes of this section, drug-trafficking means the illegal

manufacture, sale, or distribution, or the possession with intent to

manufacture, sell, or distribute, of a controlled substance (as defined

in section 102 of the Controlled Substances Act (21 U.S.C. 802)). For

purposes of this section, violent criminal activity means any illegal

criminal activity that has as one of its elements the use, attempted

use, or threatened use of physical force against the person or property

of another.

(c) Written policies and procedures. The HA must adopt and

implement written policies for admission of tenants and procedures

identifying standards and criteria for tenant selection that comply

with the provisions of the 1937 Act, 42 U.S.C. 1437d, and applicable

civil rights requirements, including the following elements:

(1) Policies on illegal drug use and abuse of alcohol.

(i) The HA must establish standards for denying admission if the HA

determines that:

(A) Any Family member is illegally using a controlled substance; or

(B) There is reasonable cause to believe that a Family member's

illegal use or pattern of illegal use of a controlled substance or

abuse or pattern of abuse of alcohol may interfere with the health,

safety, or right to peaceful enjoyment of the premises by other

residents.

(ii) In determining whether to deny admission for illegal use or

pattern of use of a controlled substance or for abuse or pattern of

abuse of alcohol, the HA may consider whether the person:

(A) Is no longer engaging in the illegal use of a controlled

substance or in abuse of alcohol (as applicable); or

(B) Has successfully completed a supervised drug or alcohol

rehabilitation program (as applicable), has otherwise been

rehabilitated successfully, or is participating in a supervised drug or

alcohol rehabilitation program (as applicable).

(2) Requirements for applications and waiting lists. (See 24 CFR

1.4 and subpart C of this part). A dwelling unit must not be allowed to

remain vacant for the purpose of awaiting an application from a family

falling within a particular income range or for any other preference;

(3) Policies for selection of applicants from the waiting list.

Selection policies must include:

(i) Preferences. Federal preferences (if any), and any ranking or

local preferences, and how they are applied. (See 24 CFR part 5,

subpart D, for applicable requirements.)

(ii) Tenant selection and assignment plan. The organization of the

waiting

[[Page 25735]]

list, how applicants are assigned to specific projects and dwelling

units, and the precedence of transfers over admissions;

(iii) General screening criteria. Applicant screening criteria and

information to be considered must be reasonably related to each

applicant's individual attributes and behavior, and not imputed to a

particular group or category of persons of which an applicant may be a

member. These criteria must be related to whether an applicant's

conduct would be likely to interfere with other residents by adversely

affecting their health, safety or welfare or the physical environment

or the financial stability of the project if the applicant were

admitted.

(4) Policies for participant transfer between units, projects, and

programs. These shall include a policy on the transfer to a standard

unit of an applicant who was admitted to an accessible unit but does

not need its special features when an applicant who does need the

unit's special features is being admitted.

(d) Availability of policies. These policies must be available in

each office where applications are received and be furnished to

applicants or tenants upon request, free or at their expense, at the

discretion of the HA. A copy must be submitted to HUD upon request.

(e) Tenant Advisory Boards. The HA may establish Tenant Advisory

Boards for consultation in connection with the tenant selection

process.

Sec. 960.203 Nondiscrimination requirements.

The HA must administer its system of tenant selection and

determinations concerning continued assistance in accordance with the

nondiscrimination requirements specified with respect to selection

preferences in 24 CFR 5.410.

Sec. 960.206 Verification procedures.

(a) General. (1) The HA must develop procedures to obtain and

verify information with respect to each applicant's qualification for

admission. (See 24 CFR part 5, subpart B.) Information relative to the

acceptance or rejection of an applicant and the granting or denial of a

preference under 24 CFR part 5 must be documented and placed in the

applicant's file. The methods of verification and documentation must be

specified in writing.

(2) Relevant information to verify with respect to an applicant's

qualification may include, but is not limited to:

(i) An applicant's past performance in meeting financial

obligations, especially rent; and

(ii) A record of violent criminal activity, drug-trafficking,

destruction of property, disturbance of neighbors, or living or

housekeeping habits that may adversely affect the health, safety or

welfare of others.

(b) Disabilities. (1) With respect to applicants claiming that they

have a disability, the HA may verify the claim only to the extent

necessary to ensure:

(i) That applicants are qualified for the housing for which they

are applying;

(ii) That applicants are qualified for the deductions used in

determining adjusted income;

(iii) That applicants are entitled to any preference they may

claim; and

(iv) That applicants who have requested a reasonable accommodation

have a need for the requested accommodation. For purposes of this part,

``reasonable accommodation'' means special action(s) to overcome

barriers to equal access in order to provide access to the HA's

programs and activities for a person with a disability.

(2) An applicant who does not want to be considered on the basis of

a disability does not have to reveal the existence of a disability. The

HA may not inquire about a disability if none is revealed by the

applicant.

(3) If an applicant does not satisfy the HA's tenant selection

criteria because of a disability, the HA must, if requested by the

applicant:

(i) Consider whether any mitigating circumstances related to the

disability could be verified to explain and overcome the problematic

conduct; and

(ii) Make a reasonable accommodation that will allow the applicant

to meet the HA's tenant selection criteria.

(c) Criminal activity.--(1) Background check. The HA must perform a

criminal background check of all adult household members to identify

any recent history of crimes of physical violence to persons or

property and other activities that would adversely affect the health,

safety or welfare of others. The type of criminal background check done

is within the discretion of the HA. For purposes of this paragraph

(c)(1), a criminal background check is accessing an individual's

criminal history records from a local, State, or Federal government

entity with law enforcement responsibility or with responsibility for

maintaining governmental records relating to criminal acts.

(2) Standard of evidence. In determining whether to deny admission

to a family based on drug-related criminal activity or violent criminal

activity, the HA may act where the preponderance of evidence indicates

that a family member has engaged in such activity, regardless of

whether the family member has been arrested or convicted.

(d) Documentation of rehabilitation from drug or alcohol abuse. The

HA may require a family member who has engaged in the illegal use of a

controlled substance, or in abuse of alcohol that interfered with the

health, safety, and peaceful enjoyment of the premises by other

residents, to submit evidence of current participation in, or

successful completion of, a supervised drug or alcohol rehabilitation

program (as applicable) as a condition to admission.

(e) Treatment of unfavorable information.--(1) General. If

unfavorable information is received about an applicant's ability to

meet the tenant selection criteria, consideration must be given to

mitigating circumstances such as the time, nature, and extent of the

applicant's conduct and to factors that in the judgment of the HA

indicate a reasonable probability of favorable future conduct.

(2) Criminal record. If the unfavorable information is a criminal

record, the HA must safeguard the record in accordance with 42 U.S.C.

1437d(q) (4) and must provide the applicant a copy of the record and an

opportunity to dispute the accuracy and relevance of the record.

(f) Final determination. After appropriate verification, the HA

makes the final determination as to whether a claim of mitigating

circumstances or a proposed accommodation is sufficient to overcome a

failure to meet the HA's tenant selection criteria.

Sec. 960.207 Communication with applicants.

(a) Form of communication. At the initial point of contact with

each applicant, the HA must inform the applicant that forms of

communication other than standard written communication, such as oral

explanation, sign language, large print, audiotape, or braille, can be

made available to the applicant, upon request. If the applicant

requests that the HA use an alternative form of communication, the HA

must use the agreed upon alternative form, in addition to its written

communication, until the applicant requests another form of

communication or notifies the HA that an alternative form of

communication is no longer necessary.

(b) Notification of denial. The HA must promptly notify any

applicant determined unqualified for admission to a project of the

basis for such

[[Page 25736]]

determination, and must provide the applicant upon request, within a

reasonable time after the determination is made, with an opportunity to

meet with a representative of the HA to review the determination. This

meeting may be conducted by any person or persons designated by the HA,

including the person who made or reviewed the original determination.

The notification must inform the applicant of the HA's responsibility

to make reasonable accommodation for applicants with disabilities and

the applicant's right to propose a reasonable accommodation to enable

the applicant to comply with eligibility criteria.

(c) Notification of acceptance. When the HA determines that an

applicant is qualified for admission, the applicant must be notified of

the approximate date of occupancy insofar as that date can be

reasonably determined. Notification of the waiting period of similar

applicants who are currently being admitted will meet this requirement.

Sec. 960.208 Rent.

The amount of rent payable by the tenant to the HA is the Tenant

Rent, as defined in part 5 of this title.

Sec. 960.209 Reexamination of family income and composition.

(a) Regular reexaminations. When the HA reexamines the income and

composition of tenant families in accordance with 24 CFR part 5,

subpart F, it must determine whether the family's unit size is still

appropriate. In accordance with that rule, after consultation with the

family and upon verification of the information, the HA must make

appropriate adjustments in tenant rent. See requirements concerning

consent forms for income and eligibility requirements (including

citizenship or immigration status) in 24 CFR part 5, subparts B and E.

(b) Interim redeterminations. The HA must adopt policies

prescribing when and under what conditions tenant changes in

circumstances must be reported and prescribing the effective date of

rent changes resulting from interim redeterminations. The tenants must

comply with provisions in the lease regarding interim reporting of

changes. If the HA receives information concerning a change in the

tenant income or other circumstances between regularly scheduled

reexaminations that would require a redetermination under its policy,

the HA must consult with the family and make any adjustments determined

to be appropriate. Any change in the family's circumstances that

results in adjustment in the Tenant Rent must be verified. See 24 CFR

part 5 for other applicable requirements. At any interim

redetermination when there is a new family member, the HA must follow

the requirements of 24 CFR part 5 concerning obtaining and processing

information on the citizenship or eligible immigration status of the

new family member.

(c) Termination. For provisions requiring termination of tenancy

for failure to establish citizenship or eligible immigration status,

and for provisions concerning assistance to certain mixed families

(families whose members include those with citizenship and eligible

immigration status and those without eligible immigration status) in

lieu of termination of tenancy, see 24 CFR part 5.

Sec. 960.210 Continued occupancy limits.

(a) General. The HA may adopt reasonable income limits for

continued occupancy of its dwelling units. The limits must not be less

than the low income limit determined by HUD, in accordance with 24 CFR

part 5.

(b) Action based on ineligibility. No HA may commence eviction

proceedings, or refuse to renew a lease, based on the income of the

tenant family unless:

(1) It has identified, for possible rental by the family, a decent,

safe, and sanitary unit of suitable size available at a rent not

exceeding the tenant rent as defined and calculated in accordance with

24 CFR part 5; or

(2) It is required to do so by local law.

Subpart C--Applications, Waiting List, Tenant Selection and

Assignment

Sec. 960.301 Applications.

(a) The HA must have a written application before placing any

applicant on the waiting list. The HA must, if requested, provide

assistance to the applicant in completing the application.

(b) The application must provide sufficient information to the HA

for it to make a preliminary determination of the applicant's

eligibility, type and size of dwelling requirement, and rent.

(c) The HA must record the date and time of receipt of all

applications and process them centrally.

(d) Unless the waiting list is closed, the HA must give an

applicant an opportunity to submit a written application, even if

informal discussion suggests that the applicant is not eligible.

Sec. 960.303 Waiting lists.

See 24 CFR 1.4 for requirements concerning selection of tenants for

all of the public housing projects under an HA's jurisdiction from a

community-wide waiting list. The HA may divide its waiting list into

separate categories for general occupancy projects, for mixed

population projects, for projects designated for elderly families, and

for projects designated for disabled families, provided that all

applicants are given an opportunity to be on the waiting list for any

category of project for which they are qualified.

Sec. 960.304 Tenant selection and assignment.

(a) Assignment of applicants and units must be conducted in

accordance with a Tenant Selection and Assignment Plan that meets the

requirements of 24 CFR 1.4(b)(2)(ii) and is approved by HUD.

(b) Unit assignments must be in sequence and must be based on the

type of project, size and type of unit required, applicable Federal and

local preferences, and date and time of application. See 24 CFR

1.4(b)(2) and 24 CFR part 5, subpart D.

(c) The HA may move to the bottom of the waiting list or remove

from the waiting list the name of any applicant who refuses more than

the number of offers of suitable units prescribed in the HA's plan. The

HA may prohibit any applicant whose name was removed in accordance with

such a policy from reapplying for a period of time specified in the

plan. The number of offers allowed under the plan must not exceed

three.

(d) An applicant who is dropped from the waiting list because a

disability interfered with the ability to respond to an HA request can

be reinstated as a reasonable accommodation.

Sec. 960.307 Mixed population projects.

(a) For purposes of this section, a ``mixed population project'' is

a public housing project, or portion of a project, that either was

reserved for elderly families and disabled families at its inception

(and has retained that character), or was approved by HUD for

preference in tenant selection to elderly families and disabled

families.

(b) Elderly families and disabled families must be given a

preference over all other applicants for admission to dwelling units in

a mixed population project.

(c) Preference must be given to elderly families and disabled

families equally in determining priority for admission to mixed

population projects. An HA may not establish a limit on the number of

elderly families or disabled families who may be accepted for occupancy

in a mixed population project.

(d) In offering available units to elderly families and disabled

families in

[[Page 25737]]

mixed population projects, units with accessible features must be

offered first to persons with disabilities who require the

accessibility features of the unit in accordance with the requirements

of 24 CFR 8.27 and 24 CFR 100.202(c)(3).

(e) If Federal preferences are in effect, elderly families and

disabled families who do not qualify for a Federal preference and who

are given preference for admission under paragraph (b) of this section

over non-elderly families and non-disabled families that qualify for a

Federal preference, are not subject to the statutory limitation on

admission of families without a Federal preference over families with

such a Federal preference that may initially receive assistance in any

one-year period.

Subpart D--Exemption From Eligibility Requirements for Police

Officers and Other Security Personnel

Sec. 960.401 Exemption from eligibility requirements.

HUD may exempt officers from the eligibility requirements for

admission to public housing, provided that:

(a) The officers would not be eligible, under any other admission

requirements or procedures, for admission to the public housing

development without such an exemption; and

(b) The exemption is given under a plan, as described in

Sec. 960.402, that has been approved by HUD.

Sec. 960.402 Definitions.

Officer means a professional police officer or other professional

security provider. Police officers and other security personnel are

considered professional if they are employed full time, i.e., not less

than 35 hours per week, by a governmental unit or a private employer

and compensated expressly for providing police or security services. As

used in this subpart, ``Officer'' may refer to the Officer as so

defined or to the Officer and his or her family taken together,

depending on the context.

Plan means the written plan submitted by a housing agency (HA) to

the Department, under which, if approved, the Department will exempt

Officers from the normal eligibility requirements for residence in

public housing and allow Officers, who are otherwise not eligible, to

reside in public housing units. An HA may have only one plan in effect

at any one time, which will govern exemptions under this subpart for

all public housing managed by that HA.

Sec. 960.405 Plan standards and criteria.

(a) Minimum requirements. To be approved, a plan must satisfy the

following requirements:

(1) The plan must identify the number of units under management by

the HA and the number and location of the units the HA intends to use

for officers and the amount of rent to be charged and a basis for

determining that it is reasonable;

(2) The plan must identify the specific benefits to the community

and to the HA that will result from the presence of the officer in each

affected development;

(3) The plan must describe the existing physical and social

conditions in and around each affected development sufficient for HUD

to make an informed assessment of the level of need for increased

security; and

(4) The plan will provide information sufficient for HUD to

determine that granting an exemption will:

(i) Increase security for other public housing residents;

(ii) Result in a limited loss of income to the HA; and

(iii) Not result in a significant reduction of units available for

residence by qualified families.

(b) Certifications by HA. The HA must certify that:

(1) The dwelling units proposed to be allocated to officers are

situated so as to place the officers in close physical proximity to

other residents;

(2) No resident families will have to be transferred to other

dwelling units in order to make available the units proposed to be

allocated to officers;

(3) The dwelling units proposed to be allocated to officers will be

rented under a lease that enforces the provisions of Sec. 960.409; and

(4) The number of dwelling units proposed to be allocated to

officers under the plan does not exceed a reasonable number, as

determined on the basis of total number of units under management by

the HA, in consultation with HUD.

Sec. 960.409 Special rent requirements and other terms and conditions.

The HA must lease units to officers under a lease agreement that is

consistent with the requirements of this section and with part 966 of

this chapter. If there is any inconsistency between the requirements of

part 966 and this section, the provisions of this section shall govern.

(a) Reasonable rent. The lease must provide for a reasonable rent.

(b) Continued employment. The lease must provide that the officer's

right of occupancy is dependent on the continuation of the employment

that qualified the officer for residency in the development under the

plan and provide that the officer will move from the unit within a

reasonably prompt time, to be established in the lease, after

termination of such employment.

Sec. 960.411 Applicability of the annual contributions contract;

effect on the Performance Funding System.

(a) Annual contributions contract. Public housing units occupied by

Officers in accordance with a plan submitted and approved under this

subpart will be subject to the terms and conditions of the annual

contributions contract (ACC) between the HA and HUD. This subpart does

not override any of the terms and conditions of the ACC except insofar

as they are inconsistent with the provisions of this subpart.

(b) Performance funding system. For purposes of the operating

subsidy under the Performance Funding System (PFS) described in part

990, subpart A, of this chapter, dwelling units allocated to Officers

in accordance with this subpart are excluded from the total unit months

available, as defined in Sec. 990.102 of this chapter. Also for

purposes of the operating subsidy under the PFS, the full amount of any

rent paid by Officers in accordance with this subpart is included in

other income, as defined in Sec. 990.102 of this chapter. HAs may

receive operating subsidy for one unit per housing development to

promote economic self-sufficiency services or anti-drug programs,

including housing police officers and security personnel. An HA may

request consideration of such units in its calculation of operating

subsidy eligibility through the appropriate local HUD Office. (See

Sec. 990.108(b) of this chapter.)

PART 966--LEASE AND GRIEVANCE PROCEDURES

2. The authority citation for part 966 continues to read as

follows:

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

3. In Sec. 966.4, paragraph (l)(2) is revised to read as follows:

Sec. 966.4 Lease requirements.

* * * * *

(l) * * *

(2) Grounds for termination. The PHA shall not terminate or refuse

to renew the lease other than for serious or repeated violation of

material terms of the lease or for other good cause.

(i) General. Failure to make payments due under the lease or to

fulfill the tenant obligations set forth in Sec. 966.4(f)

[[Page 25738]]

would constitute grounds for termination of tenancy.

(ii) Crime. (A) At any time, the PHA may terminate the lease if the

PHA determines that any family member has engaged in drug-trafficking

or violent criminal activity. For purposes of this section, drug-

trafficking means the illegal manufacture, sale, or distribution, or

the possession with intent to manufacture, sell, or distribute, of a

controlled substance (as defined in section 102 of the Controlled

Substances Act (21 U.S.C. 802)). For purposes of this section, violent

criminal activity means any illegal criminal activity that has as one

of its elements the use, attempted use, or threatened use of physical

force against the person or property of another.

(B) The PHA may terminate the lease if the PHA determines that any

family member, a guest, or another person under the tenant's control,

is engaged in any criminal activity that threatens the health, safety

or right of peaceful enjoyment of the PHA's public housing premises by

other residents or any drug-related criminal activity.

(iii) Illegal drug use and alcohol abuse. (A) The PHA must

establish standards for determining whether to terminate program

assistance if the PHA determines that:

(1) Any family member is illegally using a controlled substance; or

(2) A family member's use of a controlled substance or abuse of

alcohol interferes with the health, safety, or right to peaceful

enjoyment of the premises by other residents.

(B) In determining whether to deny or terminate program assistance

for illegal use or pattern of use of a controlled substance or for

abuse or pattern of abuse of alcohol by a family member, the PHA may

consider whether the person:

(1) Is no longer engaging in the illegal use of a controlled

substance or in abuse of alcohol (as applicable); or

(2) Has successfully completed a supervised drug or alcohol

rehabilitation program (as applicable), has otherwise been

rehabilitated successfully, or is participating in a supervised drug or

alcohol rehabilitation program (as applicable).

(C) The PHA may require a family member who has engaged in the

illegal use of a controlled substance, or in alcohol abuse activity

that interfered with the health, safety, and peaceful enjoyment of the

premises by other residents, to submit evidence of current

participation in, or successful completion of, a supervised drug or

alcohol rehabilitation program (as applicable) as a condition to being

allowed to reside in the unit.

(D) In determining whether to terminate the lease based on drug-

related criminal activity or violent criminal activity, the PHA may act

when the preponderance of evidence indicates that the person has

engaged in such activity, regardless of whether the person has been

arrested or convicted.

* * * * *

Dated: April 9, 1997.

Kevin Emanuel Marchman,

Acting Assistant Secretary for Public and Indian Housing.

[FR Doc. 97-12080 Filed 5-8-97; 8:45 am]

BILLING CODE 4210-33-P