TITLE
Recommendation to adopt Revised Standard Utility Allowance Schedules; and
Adopt Energy Efficiency-Based Utility Allowance Schedules for New Construction Projects. (Citywide)
DISCUSSION
The U.S. Department of Housing and Urban Development (HUD) requires Public Housing Agencies to annually review and, if necessary, amend their Utility Allowance Schedules if there is a 10 percent change in market utility rates. In August 2019, the Housing Authority commissioned The Nelrod Company to review and assess: (1) the Standard Utility Allowance Schedules, which are used when calculating the tenant portion that each assisted household must pay for utilities; and, (2) the Energy Efficient Utility Allowance Schedules, which are used to calculate the costs of tenant-paid utilities in new residential construction projects that meet certain energy efficiency criteria. The summary results found a 12 percent and 36 percent increase in the market utility categories of electricity and water, respectively (Exhibit A).
It should be noted that the percentage change in the market utility comparison between 2019 and 2020 was based on calculations required by HUD and the percentage rate changes do not necessarily correlate directly to the percentage change a person would pay for utilities.
The review conducted by The Nelrod Company projects increases to utility allowances in 2020 for the Housing Choice Voucher (HCV) Program. For a two-bedroom single-family detached unit (a standard household per HUD), the percentage increases in utility allowance range from 0 percent (for cooking natural gas) to 13.6 percent (for water); the percentage increases for electricity are 10.5 percent for heating and 12.5 percent for cooking. The Utility Allowance Schedules updated for 2020 for all unit types are attached (Exhibit B).
This matter was reviewed by Deputy City Attorney Richard F. Anthony on September 19, 2019 and by Revenue Management Officer Geraldine Alejo on September 20, 2019.
TIMING CONSIDERATIONS
Action on this item is requested on October 8, 2019, as the Housing Authority would like to implement the new utility allowance schedules on January 1, 2020.
FISCAL IMPACT
There is no net fiscal impact to the City from the revised utility allowance schedules. Current appropriations in the Housing Authority Fund in the Health and Human Services Department are estimated to sufficiently cover the increase to Housing Assistance payments. If needed, the Department will return to the City Council with a request to increase appropriations, fully offset by disbursements from HUD for Housing Assistance Payments. There is no local job impact associated with this recommendation.
SUGGESTED ACTION
Approve recommendation.
Respectfully Submitted,
KELLY COLOPY
ASSISTANT EXECUTIVE DIRECTOR
APPROVED:
THOMAS B. MODICA
EXECUTIVE DIRECTOR