6688 Federal Register / Vol. 75, No. 27 / Wednesday, February 10, 2010 / Notices 

3There are four non-metropolitan counties that 

continue to use CPI city updates: Ashtabula County, 

OH, Henderson County, TX, Island County, WA, 

and Lenawee County, MI. BLS has not updated the 

geography underlying its survey for new OMB 

metropolitan area definitions and these counties, 

are no longer in metropolitan areas, but they are 

included as parts of CPI surveys because they meet 

the 75percent standard HUD imposes on survey 

coverage. These four counties are treated the same 

as metropolitan areas using CPI city data. 

HUD-defined metropolitan area, called 

‘‘HUD Metro FMR Area’’ (HMFA), 

within that CBSA. If the CBSA is not 

covered by a CPI city-survey, the CBSA 

is assigned the relevant regional CPI 

factor. Almost all non-metropolitan 

counties are assigned regional CPI 

factors.3 For areas assigned the Census 

Region CPI factor, both metropolitan 

and non-metropolitan areas receive the 

same factor. 

Each metropolitan area that uses a 

local CPI update factor is listed 

alphabetically in the tables by state and 

each HMFA is listed alphabetically 

within its respective CBSA. Each 

Contract Rent AAF applies to a 

specified geographic area and to units of 

all bedroom sizes. Contract Rent AAFs 

are provided: 

• For separate metropolitan areas, 

including HMFAs and counties that are 

currently designated as nonmetropolitan, but are part of the 

metropolitan area defined in the local 

CPI survey. 

• For the four Census Regions for 

those metropolitan and nonmetropolitan areas that are not covered 

by a CPI city-survey. 

The Contract Rent AAFs shown at 

http://www.huduser.org/portal/ 

datasets/aaf.html/ 

FY2010_CR_tables.pdf use the same 

OMB metropolitan area definitions, as 

revised by HUD, that are used in the FY 

2010 FMRs. 

Area Definitions 

To make certain that they are using 

the correct Contract Rent AAFs, users 

should refer to the Area Definitions 

Table section at http:// 

www.huduser.org/portal/datasets/ 

aaf.html/FY2010_AreaDef.pdf. For units 

located in metropolitan areas with a 

local CPI survey, Contract Rent AAF 

areas are listed separately. For units 

located in areas without a local CPI 

survey, the metropolitan or 

nonmetropolitan counties receive the 

regional CPI for that Census Region. 

The Area Definitions Table at http:// 

www.huduser.org/portal/datasets/ 

aaf.html/FY2010_AreaDef.pdf lists areas 

in alphabetical order by state. The 

associated CPI region is shown next to 

each state name. Areas whose Contract 

Rent AAFs are determined by local CPI 

surveys are listed first. All metropolitan 

areas with local CPI surveys have 

separate Contract Rent AAF schedules 

and are shown with their corresponding 

county definitions or as metropolitan 

counties. In the six New England states, 

the listings are for counties or parts of 

counties as defined by towns or cities. 

The remaining counties use the CPI for 

the Census Region and are not 

specifically listed in the Area 

Definitions Table at http:// 

www.huduser.org/portal/datasets/ 

aaf.html/FY2010_AreaDef.pdf. 

Puerto Rico and the Virgin Islands use 

the South Region Contract Rent AAFs. 

All areas in Hawaii use the Contract 

Rent AAFs identified in the Table as 

‘‘STATE: Hawaii,’’ which are based on 

the CPI survey for the Honolulu 

metropolitan area. The Pacific Islands 

use the West Region Contract Rent 

AAFs. 

Accordingly, HUD publishes these 

Annual Adjustment Factors for the 

Section 8 Housing Assistance Payments 

programs as set forth in the Contract 

Rent AAF Tables posted at http:// 

www.huduser.org/portal/datasets/ 

aaf.html/FY2010_CR_tables.pdf. 

Dated: February 4, 2010. 

Raphael W. Bostic, 

Assistant Secretary for Policy Development 

and Research. 

[FR Doc. 2010–2991 Filed 2–9–10; 8:45 am] 

BILLING CODE 4210–67–P 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

[Docket No. FR–5391–N–02] 

Section 8 Housing Assistance 

Payments Program—Renewal Funding 

Annual Adjustment Factors, Fiscal 

Year 2010 

AGENCY: Office of the Secretary, HUD. 

ACTION: Notice of Renewal Funding 

Annual Adjustment Factors (AAFs). 

SUMMARY: The Consolidated 

Appropriations Act, 2010 (Pub. L. 111– 

117), directs HUD’s Office of Public and 

Indian Housing (PIH) to ‘‘provide 

renewal funding for each Public 

Housing Agency (PHA) based on 

Voucher Management System (VMS) 

leasing and cost data for the most recent 

Federal fiscal year and by applying the 

most recent Annual Adjustment Factors 

as established by the Secretary’’. This 

notice announces Renewal Funding 

AAFs in response to that directive. 

Consumer Price Index (CPI) data, 

similar to those used for ‘‘Contract Rent 

AAFs’’, are used, but semi-annual CPI 

data replaces annual CPI data. This 

makes the Renewal Funding AAFs six 

months more current than the CPI data 

used to derive Contract Rent AAFs. 

These CPI data are more current data 

and better reflect the economic 

circumstances most relevant to the 

Housing Choice Voucher (HCV) program 

in 2010 and the assumptions of the 2010 

budget. Like the Contract Rent AAFs, 

these factors are based on a formula 

using residential rent and utility cost 

changes. Contract Rent AAFs were 

published in a separate notice which 

can be viewed at: http:// 

www.huduser.org/portal/datasets/ 

aaf.html/FY2010_CF_table.pdf. 

DATES: Effective Date: February 10, 

2010. 

FOR FURTHER INFORMATION CONTACT: 

Contact David Vargas, Associate Deputy 

Assistant Secretary for Office of Public 

Housing and Voucher Programs, Office 

of Public and Indian Housing, 202–708– 

2815; and Marie L. Lihn, Economist, 

Economic and Market Analysis 

Division, Office of Policy Development 

and Research, 202–708–0590, for 

technical information regarding the 

development of the schedules for 

specific areas or the methods used for 

calculating the AAFs. Mailing address 

for the above persons: Department of 

Housing and Urban Development, 451 

7th Street, SW., Washington, DC 20410. 

Hearing- or speech-impaired persons 

may contact the Federal Information 

Relay Service at 800–877–8339 (TTY). 

(Other than the ‘‘800’’ TTY number, the 

above-listed telephone numbers are not 

toll free.) 

SUPPLEMENTARY INFORMATION: The table 

showing Renewal Funding AAFs will be 

available electronically from the HUD 

data information page at http:// 

www.huduser.org/portal/datasets/ 

aaf.html/FY2010_RF_table.pdf. Renewal 

Funding AAFs include utility costs and 

only one set of AAFs is published for 

this purpose. 

I. Methodology 

Renewal Funding AAFs are derived 

from rent inflation factors to account for 

relative differences in rent inflation 

among different parts of the country. 

Two types of rent inflation factors are 

typically calculated for AAFs: Gross 

rent factors and shelter rent factors; 

however, only the gross rent inflation 

factor is used for Renewal Funding 

AAFs. The gross rent factor accounts for 

inflation in the cost of both the rent of 

the residence and the utilities used by 

the unit. 

Renewal Funding AAFs are calculated 

using CPI data on ‘‘rent of primary 


sroberts on DSKD5P82C1PROD with NOTICES
Federal Register / Vol. 75, No. 27 / Wednesday, February 10, 2010 / Notices 6689 

1CPI indexes CUUSA103SEHA and 

CUSR0000SAH2 respectively. 

2The formulas used to produce these factors can 

be found in the Annual Adjustment Factors 

overview and in the FMR documentation at 

http://www.HUDUSER.org. 

residence’’ and ‘‘fuels and utilities’’.1

The CPI inflation index for rent of 

primary residence measures the 

inflation of all surveyed units regardless 

of whether utilities are included in the 

rent of the unit or not. In other words, 

it measures the inflation of the ‘‘contract 

rent’’ which includes units with all 

utilities included in the rent, units with 

some utilities included in the rent and 

units with no utilities included in the 

rent. In producing a gross rent inflation 

factor, HUD decomposes the contract 

rent CPI inflation factor into parts to 

represent the gross rent change and the 

shelter rent change. This is done by 

applying the percentage of renters who 

pay for heat (a proxy for the percentage 

of renters who pay shelter rent) from the 

Consumer Expenditure Survey (CEX) 

and American Community Survey 

(ACS) data on the ratio of utilities to 

rents.2 The CEX data used to decompose 

the contract rent inflation factor into 

gross rent and shelter rent inflation 

factors come from a special tabulation of 

2007 CEX survey data produced for 

HUD for the purpose of computing 

Renewal Funding AAFs. The utility-torent ratio used in the formula comes 

from 2007 ACS median rent and utility 

costs. 

In this publication, the rent and 

utility inflation factors for large 

metropolitan areas and Census regions 

are based on changes in the rent of 

primary residence and fuels and utilities 

CPI indices from the first half of 2008 

to the first half of 2009, the most recent 

data available at the time of the 

development of final budget projections 

for fiscal year (FY) 2010. Typically, CPI 

indexes averaged over a 12-month 

period have been used to measure the 

change in gross rents from year to year. 

The semi-annual indexes used for 

Renewal Funding AAFs average data 

over six months as opposed to 12 

months; the Renewal Funding AAFs use 

change over the course of two semiannual index cycles to derive a 12- 

month adjustment. 

II. The Use of Renewal Funding AAFs 

The Renewal Funding AAFs differ 

from past AAFs and the FY2010 

Contract Rent AAFs in that they make 

use of more recent semi-annual CPI 

indexes in place of average annual CPI 

indexes. The Renewal Funding AAFs 

have been developed to account for 

relative differences in the recent 

inflation of rents among different areas 

and are used to allocate HCV funds 

among PHAs. HUD is reviewing and 

updating the methodologies for all 

program parameters, including Fair 

Market Rents (FMRs), AAFs and other 

inflation indices. The publication of 

these separate Renewal Funding AAFs 

for allocation of voucher funds is an 

interim step toward more complete 

reforms including using more recent 

data in HUD’s estimations for various 

program parameters, including FMRs, as 

published in the Federal Register on 

September 30, 2009 (74 FR 50552). 

III. Geographic Areas 

Renewal Funding AAFs are produced 

for all Class A CPI cities (CPI cities with 

a population of 1.5 million or more) and 

for the four Census Regions. They are 

applied to core-based statistical areas 

(CBSAs), as defined by the Office of 

Management and Budget (OMB), 

according to how much of the CBSA is 

covered by the CPI city-survey. If more 

than 75 percent of the CBSA is covered 

by the CPI city-survey, the Renewal 

Funding AAF that is based on that CPI 

survey is applied to the whole CBSA 

and to any HUD-defined metropolitan 

area, called ‘‘HUD Metro FMR Area’’ 

(HMFA), within that CBSA. If the CBSA 

is not covered by a CPI city-survey, the 

CBSA is assigned the relevant regional 

CPI factor. Almost all non-metropolitan 

counties are assigned regional CPI 

factors. For areas assigned the Census 

Region CPI factor, both metropolitan 

and non-metropolitan areas receive the 

same factor. 

The Renewal Funding AAF tables list 

the four Census Regions first, followed 

by an alphabetical listing of each 

metropolitan area, beginning with 

Akron, OH, MSA. Renewal Funding 

AAFs are provided: 

• For separate metropolitan areas, 

including HMFAs and counties that are 

currently designated as nonmetropolitan, but are part of the 

metropolitan area defined in the local 

CPI survey, and 

• For the four Census Regions for 

those metropolitan and nonmetropolitan areas that are not covered 

by a CPI city-survey. 

Renewal Funding AAFs use the same 

OMB metropolitan area definitions, as 

revised by HUD, that are used in the FY 

2010 FMRs. 

IV. Area Definitions 

To make certain that they are 

referencing the correct Renewal 

Funding AAFs, PHAs should refer to the 

Area Definitions Table at http:// 

www.huduser.org/portal/datasets/ 

aaf.html/FY2010_AreaDef.pdf. For units 

located in metropolitan areas with a 

local CPI survey, Renewal Funding 

AAFs are listed separately. For units 

located in areas without a local CPI 

survey, the metropolitan or nonmetropolitan counties receive the 

regional CPI for that Census Region. 

The Area Definitions Table for 

Renewal Funding AAFs, shown at 

http://www.huduser.org/portal/ 

datasets/aaf.html/FY2010_AreaDef.pdf, 

lists areas in alphabetical order by state. 

The associated CPI region is shown next 

to each state name. Areas whose 

Renewal Funding AAFs are determined 

by local CPI surveys are listed first. All 

metropolitan areas with local CPI 

surveys have separate Renewal Funding 

AAF schedules and are shown with 

their corresponding county definitions 

or as metropolitan counties. In the six 

New England states, the listings are for 

counties or parts of counties as defined 

by towns or cities. The remaining 

counties use the CPI for the Census 

Region and are not specifically listed on 

the Area Definitions Table. 

Puerto Rico and the Virgin Islands use 

the South Region Renewal Funding 

AAFs. All areas in Hawaii use the 

Renewal Funding AAFs identified in 

the Table as ‘‘STATE: Hawaii,’’ which 

are based on the CPI survey for the 

Honolulu metropolitan area. The Pacific 

Islands use the West Region Renewal 

Funding AAFs. 

Accordingly, HUD publishes these 

Renewal Funding Annual Adjustment 

Factors as set forth in the Renewal 

Funding AAF Table posted at http:// 

www.huduser.org/portal/datasets/ 

aaf.html/FY2010_RF_table.pdf. 

Dated: February 4, 2010. 

Raphael W. Bostic, 

Assistant Secretary for Policy Development 

and Research. 

[FR Doc. 2010–2990 Filed 2–9–10; 8:45 am] 

BILLING CODE 4210–67–P 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

[Docket No. FR–5396–N–01] 

Sustainable Communities Planning 

Grant Program Advance Notice and 

Request for Comment 

AGENCY: Office of Sustainable Housing 

and Communities, Office of the Deputy 

Secretary, HUD. 

ACTION: Advance notice and request for 

comments. 

SUMMARY: This notice announces HUD’s 

intention to offer funding through a 

competition made available as a Notice 

of Funding Availability (NOFA) under 

its Sustainable Communities Planning 

Grant Program (Program). 


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