GAO Report

DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT

District of Columbiais Rent Establishment Policies and Procedures Need Improvement (GGD-78-50) May 17, 1978.

The report listed overall recommendations and eighteen unnumbered specific recommendations in the areas of public housing, urban renewal and utilities. For convenience in matching our comments with the report, we have numbered both the recommendations and our responses in the sequence as they appear on pages 35 through 37 of the report.

OVERALL RECOMMENDATIONS

The Mayor of the District of Columbia should direct DHCD to:

--

--

Improve policies, procedures and practices for setting rents and utility allowances of public housing and urban renewal tenants;

Regularly monitor the rent setting and utility allowance process; and Improve documentation of rent actions, particularly under the urban renewal program, to insure control over the rent setting process.

Response

The department has taken corrective action to address each of these recommendations. Specifically, they have improved their policies, procedures and practices for setting rents and utility allowances, established systems to monitor the rent setting and utility allowance process and improved the documentation 4 of rent actions and rent review of

We

The General Accounting Office questioned our previous response on this issue, suggesting that changes in the regulations do not insure that the changes will be promptly and appropriately implemented (Page 38). have administratively established the practice of implementing rent changes when they are published in the Federal Register in compliance with the recommendation of the GAO report. The mos recent rent change for the Section 8 rent subsidy program was published in the Federal Register on March 29, 1978, and implemented as the new rental rates in the Public Housing re-examination schedule effective July 1, 1978. The time involved in implementing such a change will be reduced in the future.

The basic records on income supporting rent actions are now maintained by the Family Resources Division, Housing and Business Resources Administration (HBRA). The Property Management Administration continues to maintain the lease records. The necessary data is furnished to the Real Estate Division of HBRA in conformance with the periodic rent reviews schedule as shown on page 49 of the report and at other times on an as-needed basis to make rent determinations and adjustments. The Real Estate Division of HBRA maintains the documents on these rent actions.

Base urban renewal tenants' utility allowance on consumption instead of rent.

Response

The revised rent establishment policy and procedures will address basing utility allowances, for those who pay for their own utilities, on consumption instead of rent.

Assure that tenants pay for their own utilities whenever possible.

Response

Public housing and urban renewal tenants will be required to pay for their own utilities whenever possible. See Number 7 and 18 on the review of urban renewal and cost benefit studies to convert meters.

Charge tenants who do not pay their own utilities for consumption above normal, such as for additional major appliances.

Response

Leases for public housing tenants were amended to provide an assessment charge for utility consumption on tenant supplied appliances. The assessment program was implemented September 1, 1977, and the leases will be amended as utility meter conversion takes place. See Number 18 on cost-benefit studies.

Consumption experience will be the basis for utility charges as part of the rent paid for urban renewal tenants who are not on separate meters. In view of the temporary nature of urban renewal property management, a surcharge system for additional major appliances would not normally be cost-beneficial, but will be considered in the rent setting process.