Sneak Preview: HUD Guidance Aims To Optimize PHA Occupancy

(The following was excerpted from a recent Thompson Grants Compliance Expert article.) The Department of Housing and Urban Development (HUD) recently issued guidance to public housing agencies (PHAs) providing strategies to improve and maintain an optimal occupancy rate under the federally funded Public Housing program.

HUD policy considers an optimal occupancy rate for a PHA to be greater than or equal to 98%. This level will earn a PHA the maximum points in HUD’s Public Housing Assessment System related to occupancy, indicating efficient use of available housing units.

“As the need for affordable housing grows, the supply of existing public housing remains critical to reducing homelessness and increasing economic mobility for low- to moderate-income families,” according to the guidance. “Administrative processes, technology challenges and addressing community needs can be time-consuming, especially for smaller PHAs (i.e., fewer than 250 units) with limited staff. However, streamlining these procedures without compromising regulatory compliance has proved essential to expediting the transition from vacancy to occupancy efficiently.”

The agency recognizes that certain factors not directly within a PHA’s control may affect their ability to maintain optimal occupancy, such as supply chain issues, staff attrition and neighborhood amenities. However, the agency encourages PHA’s to “take proactive measures to address vacancies by thoroughly evaluating occupancy data and engaging in discussions with property staff and residents. This comprehensive approach enables them to identify and understand the underlying factors driving or contributing to vacancies, facilitate informed decisionmaking and targeted interventions to improve occupancy rates, and support community needs.”

HUD developed the guidance after meeting with PHAs that achieved or maintained an occupancy rate of 95.5% during federal fiscal year 2023 to discuss their successful strategies. One key factor that a PHA can take to ensure a more stable, affordable housing environment, according to the guidance, is to develop and regularly update its waiting list and tenant selection policies, and establish policies that describe the circumstances under which applicants will be removed from the waiting list (e.g., those who cannot be reached or no longer interested in a public housing unit). Some PHAs use preferences, such as families experiencing homelessness and persons with disabilities, to rank applicants on the waiting list. These preferences must be described in a PHA’s Admissions and Continued Occupancy Policy.

(The full version of this story has now been made available to all for a limited time here.)

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