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Managing PHAS. Terry Provance. Managing PHAS. As a result of attending this session, you will: Understand the theory behind PHAS Identify PHAS indicators and how they are measured and scored Understand the new PHAS as proposed Begin to be able to use these assessments as a management tool. - PowerPoint PPT Presentation
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Slide #1
Terry Provance
Managing PHAS
Slide #2
Managing PHAS
As a result of attending this session, you will:• Understand the theory behind PHAS• Identify PHAS indicators and how they are
measured and scored• Understand the new PHAS as proposed• Begin to be able to use these assessments as a
management tool
Slide #3
Introduction
PHAS was designed to be system of accountability to assist HUD in monitoring and evaluating public housing• Defines acceptable standards for key areas • PHAs should use PHAS as a management
toolDon’t wait for a score from HUD!
Slide #4
Introduction
We’ll describe how PHAS should be applied to the asset management projects (AMPs)• AMPS will become the new PHAS
measurement focus• We’ll be discussing the new project-based
PHAS
Slide #5
PHAS
Four indicators:• Physical condition• Financial condition• Management operations• Resident service and
satisfaction
Slide #6
Four Indicators
Physical condition 30 points Financial condition 30 points Management operations 30 points Resident service & satisfaction 10 points
Slide #7
PHAS Scoring
A PHA’s overall PHAS grade will place it in one of the following categories:• High performer 90% to 100%• Standard performer 60% to 89%• Troubled performer 0% to 59%
Slide #8
Mandatory Requirements
Many of the current PHAS indicators are statutory• Vacancy rate• Capital fund obligation and expenditure• Rent collection• Utility consumption• Unit turnaround time…
Slide #9
Mandatory Requirements PHAS indicators which are statutory:
• Work orders• Inspections of units and systems• Screening, eviction, and anti-crime strategies• Economic self-sufficiency• Acceptable basic housing conditions• Other factors as deemed by HUD
Slide #10
PHAS Indicator #1: Physical Condition
Slide #11
Description & Purpose
For HUD to ensure that all PHAs provide housing that is:• Decent• Safe• Sanitary• In good repair
Slide #12
The Condition of Properties HUD’s intent is to determine condition of
PHA’s housing stock HUD assigns score
• UPCS software has all PHA addresses• Physical condition measured numerically• Objective and consistent• For all property types and configurations
Slide #13
What is Inspected
Inspector inspects:• Site Always 100%• Building Exteriors Sampled• Building Systems Sampled• Common Areas Sampled• Units Sampled
Slide #14
How Inspectors Inspect
HUD-contracted inspectors use hand-held computers with PASS software from HUD• Random sample generated• Software starts with a perfect score of 100
Deficiencies carry point deductionsHealth & safety deficiencies biggest deductions
Slide #15
Indicator #2: Financial Condition
Slide #16
Description & Purpose
Measures financial condition of PHA • Does the PHA have, and is it capable of
managing, financial resources to support a housing program
Slide #17
Assessment Six financial condition components:
• Current ratio• Number of months expendable fund balance• Tenant receivable outstanding• Occupancy loss• Expense mgmt/utility consumption• Net income or loss
Slide #18
Indicator #3:Management Operations
Slide #19
Assessment
Vacant unit turnaround time Capital Fund Work orders Inspection of units and systems Security Economic self sufficiency
Slide #20
Reporting Requirements
PHA must certify on HUD form-50072 on performance under each of the management indicators
This is the indicator which will change from self-certification to onsite management review• Form 5834 will be used
Slide #21
PHAS Indicator #4Resident Service & Satisfaction
10 points maximum• 5 points implementation
and follow-up• 5 points for the survey
results
Slide #22
Project-Based PHAS
Slide #23
Project-Based PHAS
PHAS is being revised to be project-based• The AMPs will be the new measurement focus
Each AMP will receive its own PHAS scoreThe AMPs are the PHA’s groupings of
properties for project-based accounting, budgeting, and management
Slide #24
The New PHAS
9/6/06 Fed Register Guidance Notice on Asset Mgt - HUD would revise PHAS to support the transition to asset mgt
• PHAs to be measured at AMP level March, 2007 Asset Management e-Newsletter
- HUD discussed conforming PHAS to multifamily housing standards
Slide #25
HUD Proposed Changes
03/2007 Asset Mgt e-Newsletter - HUD to:• Conduct and track PIH-REAC physical
inspections by AMP• Modify electronic submission of the FDS to
support collection of AMP-level data• Replace PHA’s current MASS submission with
on-site reviews (similar to multifamily)
Slide #26
HUD Proposed Changes
03/2007 Asset Mgt e-Newsletter - HUD to:• Establish new “integrated” assessment based
on newly developed PHAS indicatorsSimplify current scoring methodologiesSignificantly reduce PHA submission
requirements
Slide #27
HUD Proposed Changes
On-site management reviews of AMPs (similar to multifamily)• Would replace the subject-specific reviews• Will eliminate need for PHAS confirmatory
reviews (no PHA certifications)
Slide #28
HUD Proposed Changes
Note that fee income (property management fees, bookkeeping fees, asset management fees, capital fund management fees, etc) is not considered “program income”• No review of the COCC• Not subject to federal review!• Will streamline PHA compliance reviews
Slide #29
HUD Proposed Changes
In Federal Register, February 8, 2008, HUD published for public comment it’s proposed “Management Review for Public Housing Projects” form HUD-5834• Form to be used by HUD (or contractor)
review team
Slide #30
The New PHAS
PIH 2008-18(HA) published March 27, 2008• HUD is moving forward on project-based
PHAS• HUD will issue a proposed PHAS rule in
Spring of 2008 – including four scoring noticesScoring will be in the proposed rule
Slide #31
Notice PIH 2008-18
The new PHAS indicators will assess, for each AMP:• Physical condition• Financial condition• Management assessment• Capital fund obligation/expenditure
Slide #32
Notice PIH 2008-18
Notice 2008-18 is mostly FAQs• For first year, will PHA continue to be scored
under the old (current) PHAS?No – the last PHAs to get a score under the
current PHAS will be those with FYE March 31, 2008
Slide #33
Notice PIH 2008-18
Physical condition• No significant changes are anticipated in the
protocol for REAC inspections If a PHA scored 80 or above in the year
immediately before the transition year, the PHA’s AMPs won’t get inspected in the transition year
• If projects were combined into different AMPs, HUD will use a unit-weighted score
Slide #34
Notice PIH 2008-18
Financial condition• Although PHAs have to submit the project-
based FDS, financial condition will not be scored by project under the transitional PHAS
• Only physical condition of each project will be scored
Slide #35
Notice PIH 2008-18
Financial condition• Financial condition of each AMP will be measured
HUD will issue a final version of the Financial Data Schedule (FDS)
Probably financial liquidity (current ratio) will be assessed
• COCC and non-public housing won’t be included in the financial assessment
Slide #36
Notice PIH 2008-18
Management assessment• HUD will attempt to conduct at least one onsite
management review at all PHAs in the transition year, in order to expose PHAs to the new system
• Management reviews will not be scored in the transition year
Slide #37
Notice PIH 2008-18
Management assessment• Onsite management review will utilize HUD-5834
Form based on HUD-9834 for multifamilyHUD says it will “delineate” between
performance, compliance and process• Performance will be what’s scored
Slide #38
Goals of Review Form
To consolidate reviews of performance and compliance in a flexible manner
Allows reviewers to tailor on-site work to the needs of the project and HUD guidance
HUD-5834 contains information related to both performance and compliance
Slide #39
Performance vs. Compliance
Performance items are those that most directly relate to how well the project is operated (e.g. rate of rent collection)
Compliance items are related to project observance of program regulations (e.g. did the staff calculate rent in accordance with HUD rules)
Slide #40
On-Site Reviews
Management review form (5834) will provide the framework for the on-site reviews• Basic review will be high-level, looking at key
performance & compliance indicators• More detailed checklists can be incorporated
into the review as needed
Slide #41
Notice PIH 2008-18
Management assessment• Performance will be scored
HUD is “examining” primary vs. secondary performance measures
• Primary = indicator of high level financial, physical, or management performance
• Secondary = diagnoses potential problems in these areas
Slide #42
Notice PIH 2008-18
Management assessment• Performance will be scored
HUD states that a project’s vacancy rate is a primary performance indicator, while unit turnaround is a secondary measure
Slide #43
Form HUD-5834
Let’s look at this form more closely, since it will be an important assessment tool for project-based management under PHAS• 7 sub-indicators
Slide #44
Form HUD-5834Review for Projects
General appearance and security• Appearance and market appeal
Entrance, building exterior, paved surfaces, fencing, porches, trash, landscaping, graffiti, public spaces and amenities windows, debris, units…
Slide #45
Form HUD-5834Review for Projects
General appearance and security• Security
Crime statistics, law enforcement certification, discussions with law enforcement, observations, discussions with resident, policies for screening and evicting for history of drug-related criminal activity, alcohol abuse, and criminal
Slide #46
Form HUD-5834Review for Projects
Follow-up and monitoring of project inspections• Exigent H&S deficiencies• Lead-based paint inspection deficiencies…
Slide #47
Form HUD-5834Review for Projects
Maintenance• Unit inspections• Work orders
Average completion time• Progress in preceding three years
Slide #48
Form HUD-5834Review for Projects
Maintenance• Preventive maintenance
Systems applicable to property and in preventive maintenance plan:
• HVAC, security, fire safety, roof, gutters & downspouts, intercoms & doorbells, accessibility, elevators, mechanical, boilers, emergency generators, other
Slide #49
Form HUD-5834Review for Projects
Maintenance• Energy conservation/utility consumption
Energy audit within past 5 years?Energy audit less than 1 year old?Audit contains cost-effective
recommendations? Implemented? On schedule?
Slide #50
Form HUD-5834Review for Projects
Modernization• Physical needs assessment completed?
Updated in last 5 years?Estimating the useful life remaining and
modernization cost for all major building systems?
Slide #51
Form HUD-5834Review for Projects
Modernization• Is there a plan and budget for modernization
needs for major building systems projected to reach end of useful life in the coming FY?Consistent with PHA’s Annual Plan?
• Was a plan for mod work in previous FY?Work completed?
Slide #52
Form HUD-5834Review for Projects
Financial management• Accounts payable• Rent collection• Budget management• Procurement
Slide #53
Form HUD-5834Review for Projects
Leasing and occupancy• Vacancy rate• Turnaround time
You need to analyze make-ready time and lease-up time
Slide #54
Form HUD-5834Review for Projects
Leasing and occupancy• Occupancy review – forms 5834-A and 5834-B
Very detailed formsNumber of files reviewed Income correctly computed and verified?Rent correctly computed and verified?Applicants denied/admitted re: TSAP?
Slide #55
Form HUD-5834Review for Projects
Leasing and occupancy• Occupancy review – forms 5834-A and 5834-B
Move-outs processed correctly?Lease contains required provisions?Grievances implemented appropriately?Met PIC reporting requirements?
Slide #56
Form HUD-5834Review for Projects
Leasing and occupancy• Occupancy review – forms 5834-A and 5834-B
Complied with UIV procedures for safeguarding data, system security and resolution of income discrepancies?
Slide #57
Form HUD-5834Review for Projects
Tenant/management relations• Economic self-sufficiency
At least 85% of households have head, spouse or sole member who is elderly or disabled?
Current % of adults employed?Current % of adults participating in self-
sufficiency?
Slide #58
Form HUD-5834Review for Projects
Tenant/management relations• Economic self-sufficiency
Opportunities offered by project and/or coordinates with outside agency:
• Child care, financial counseling, homeownership counseling, substance abuse counseling, GED, vocational or job training, other activities
Slide #59
Form HUD-5834Review for Projects
Tenant/management relations• Resident involvement in project administration
Newsletter, Neighborhood Watch, regular tenant meetings, resident participation on committees, tenant management, contracts with resident-owned businesses, substance abuse counseling, service coordinator, Neighborhood Networks Center, other
Slide #60
Form HUD-5834Review for Projects
General management practices• Prior management review findings
Findings/corrective actions?Corrections initiated/progress being made?
• Other prior review findings
Slide #61
Form HUD-5834Review for Projects
General management practices• Insurance
Does the project have the coverage required by ACC?
Slide #62
Form HUD-5834Review for Projects
General management practices• Insurance policies held:
Commercial property, commercial general liability, worker’s comp, owned and non-owned auto, theft, disappearance & destruction, fidelity, boiler and machinery, directors & officers or public liability, law enforcement liability, flood, wind, other
Slide #63
The New PHAS
Capital fund program• Obligation and
expenditure will be assessed for each AMP
Slide #64
Proposed PHAS Breakdown
The proposed PHAS is anticipated to be comprised of four components
• PASS - 30 Points• FASS - 20 Points• MASS (onsite review) – 40 Points• Capital Fund – 10 Points
Slide #65
A Systems Approach
Slide #66
A Systems Approach
You have to know how the projects are performing• Continuous trend analysis
Leadership, a plan, and smart work
An efficient COCC More transparent data
Slide #67
A Systems Approach
Key components:• Highly skilled staff at the projects• Accurate, on-time electronic reports from and
to the project• Properties performing well
Early intervention when needed
Slide #68
A Systems Approach
Highly skilled staff at the projects:• Project managers are business managers
Managing to the budgetUnderstanding and managing to financial
reportsSkilled at marketing and tenant relations
Slide #69
A Systems Approach
Highly skilled staff at the projects:• Up-to-date job descriptions• Analysis of knowledge, skills and abilities
needed and actual – and individual development plans
• Performance of property tied to performance evaluations
Slide #70
A Systems Approach
Accurate, on-time financial reports• See stop-loss kit and forms HUD-5834
These are your templates• Quality control and file reviews• Define which reports the onsite staff will see
and manage to, reports to the asset manager, reports to the executive team, etc.
Slide #71
A Systems Approach
Review of project performance• PHA systematically reviews financial, physical,
and management performance of each project, and identifies non-performing properties
Slide #72
A Systems Approach
Review of project performance – a non-performing property has:
• PHAS physical score below 70• Significant crime and drug problems• Below 95% occupancy• TARS that exceed 7% of monthly rent roll
FAQ clarifies this means rent…
Slide #73
A Systems Approach
Review of project performance – a non-performing property has:
• PHAS grade of “D” or below for vacant unit turnaround and work orders
• Utility consumption more than 120% of agency average
• Other major management problemsTurnaround = D more than 30 daysWOs = D more than 40 days
Slide #74
A Systems Approach
Review of project performance• Long-term prospects for each property:
Maintain project as is Identify capital improvements needed Dispose of property (demo, sale, etc) Conversion Political ramifications
Stop-Loss FAQs 9/1/06
Slide #75
Summary
Start now• Train staff• Define performance
standards and manage to them
• Leadership, a plan, and hard work
Slide #76
NMA Lunch ‘n’ Learn Seminar
NEXT TOPIC…
Slide #77
NMA Lunch ‘n’ Learn Seminar
Slide #78
Upcoming Lunch ‘n’ Learns
Managing SEMAP – May 16 Public Housing Rent Calculation – June 12 HCV Rent Calculation – June 13 Ethics in your Housing Authority – June 20