Item 10 - AA for Housing Choice Voucher Program and Mainstream Voucher Program

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EXHIBIT 1 portion of the offset will be for Shortfall Prevention, which will supplement the HAP Set -Aside funding. For the months of January through May of 2023, your agency received HAP obligations based on an estimated CY 2023 renewal level. If your PHA has been under -obligated renewal funds through May 2023, based on the prorated funding eligibility indicated on Enclosure A (applicable only to non-MTW PHAs, MTW PHAs will receive a different eligibility enclosure), the additional amount due will be obligated in the immediate future. If your PHA has been over -obligated funds through May 2023, the June obligation will be reduced accordingly, so that your PHA is obligated the accurate amount f6r the year. HAP disbursements for January through May of 2023, and for the rest of the CY 2023, have and will be based on cash management procedures established in PIH Notice 2017-06. Except f'or MTW PHAs, no HAP funds provided for a PHA under the 2023 Act may be used to incur in over leasing, to support prior year deficits or provide for administrative expenses, nor may they be loaned or transferred to cover other program obligations, such as Low -Rent and/or Capital Fund programs. Therefore, it is each PHA's responsibility to retain the appropriate records to support VMS submissions for the collected periods, as they are subject to on -site review by the Quality Assurance Division (QAD). Subsequent recalculation of CY 2023 funding eligibility will occur if a QAD or other HUD review demonstrates that costs were incorrectly reported, resulting in excess funding. Finally, it is strongly recommended that PHAs utilize the Two -Year Forecasting tool on the HUD web site, in consultation with their local HUD field office, to ensure that correct variables for the PHA are entered into the tool to arrive at the most accurate forecast to enable the PHA to maximize leasing while avoiding the need to terminate assistance to any households. The tool and instructions can be found by clicking on the following link: Two -Year Tool and Instructions. Additionally, HAP Set -Aside funds are available in CY 2023 to address shortfalls, but in order to qualify, a PHA must have the shortfall confirmed by the Shortfall Prevention Team (SPT) and must initiate cost reduction steps. This process is detailed in the implementation notice referenced at the start of this letter. If you have any questions concerning your CY 2023 HAP renewal funding, please contact your Financial Analyst (FA) at the Financial Management Center (FMC). Sincerely, Digitally signed by MIGUEL MIGUEL FONTANEZ FONTANEZSANCHEZ SANCHEZ Date: 2023.03.3011:41:38 -04'00' Miguel A. Fontanez Director Housing Voucher Financial Management Division Attachment