40028 Federal Register / Vol. 65, No. 125 / Wednesday, June 28, 2000 / Notices

DEPARTMENT OF HOUSING AND

URBAN DEVELOPMENT

[Docket No. FR–4509–N–15]

Public Housing Assessment System

Management Operations Scoring

Process for PHAs With Fiscal Years

Ending On or After March 31, 2000

AGENCY: Office of the Director, Real

Estate Assessment Center, HUD.

ACTION: Notice.

SUMMARY: This notice provides

additional information to public

housing agencies (PHAs) and members

of the public, regarding HUD’s process

for issuing Management Operations

scores to PHAs with fiscal years ending

on or after March 31, 2000, under the

Public Housing Assessment System

(PHAS). This notice is an update of the

Management Operations Indicator

scoring notice that was published on

June 23, 1999, and takes into

consideration public comment received

on the June 23, 1999, notice. This notice

provides the basis for scoring PHAs on

their management operations as

provided in the PHAS Amendments

final rule published on January 11,

2000, with certain corrections published

on June 6, 2000. This notice is

applicable to PHAs with fiscal years

ending on or after March 31, 2000. (The

Management Operations Scoring notice

applicable to PHAs with fiscal years

ending before March 31, 2000, is

published elsewhere in this Federal

Register.) The changes made to the

Management Operations Scoring

process for PHAs ending on or after

March 31, 2000, are discussed in the

SUPPLEMENTARY INFORMATION section of

this notice.

FOR FURTHER INFORMATION CONTACT: For

further information contact Wanda

Funk, Real Estate Assessment Center,

Department of Housing and Urban

Development, 1280 Maryland Avenue,

SW, Suite 800, Washington, DC 20024;

telephone Technical Assistance Center

at 1–888–245–4860 (this is a toll free

number). Persons with hearing or

speech impairments may access that

number via TTY by calling the Federal

Information Relay Service at (800) 877–

8339. Additional information is

available from the REAC Internet Site,

http://www.hud.gov/reac.

SUPPLEMENTARY INFORMATION:

1. Purpose of This Notice

The purpose of this notice is to

provide additional information about

the scoring process for PHAS Indicator

#3, Management Operations. The

purpose of the Management Operations

assessment is to measure certain key

management operations and

responsibilities of a PHA for the

purpose of assessing the PHA’s

management operations capabilities.

The majority of the information

provided in this notice was originally

published on May 13, 1999 (64 FR

26232), and republished on June 23,

1999 (64 FR 33708). HUD solicited

public comment on both the May 13,

1999, and June 23, 1999, notices. This

Management Operations Scoring

Process notice, published in this edition

of the Federal Register, has been revised

to reflect the public comments received

on the previous notices and to provide

the basis for scoring PHAs on their

management operations as provided in

the PHAS Amendments Final Rule

published on January 11, 2000 (65 FR

1712). This Management Operations

Scoring notice is applicable only to

PHAs with fiscal years ending on or

after March 31, 2000. (The Management

Operations Scoring notice applicable to

PHAs with fiscal years ending

September 30, 1999, or December 31,

1999, is published elsewhere in this

edition of the Federal Register.)

2. Changes From the Public Housing

Management Assessment Program

(PHMAP) to PHAS

The PHAS assessment of a PHA’s

management operations utilizes five of

the eight PHMAP indicators:

• Vacant unit turnaround time;

• Capital Fund;

• Work orders;

• Annual inspection of units and systems;

and

• Security.

Former sub-indicator #6, security and

economic self-sufficiency, are now two

separate sub-indicators: Sub-indicator

#5 is security; and sub-indicator #6 is

economic self-sufficiency. This change

reflects compliance with and the intent

of the Quality Housing and Work

Responsibility Act of 1998 (Pub.L. 105–

276, approved October 21, 1998

(referred to as the ‘‘Public Housing

Reform Act’’) which added economic

self-sufficiency of public housing

residents as an additional factor under

section 6(j) of the U. S. Housing Act of

1937. The statute recognizes the

importance of this area as a separate

assessment factor, and the Department

has amended the Management

Operations Indicator to reflect the

statutory guidance.

The adjustment for physical condition

and/or neighborhood environment will

be made under PHAS Indicator #1,

Physical Condition. The same

definitions and exemptions that apply

to the PHMAP also apply to the PHAS,

except as noted in 24 CFR 902, subpart

D. The PHMAP indicator for financial

management is assessed under PHAS

Indicator #2, Financial Condition; and

PHMAP indicator #7 for resident

services is assessed under PHAS

Indicator #4, Resident Service and

Satisfaction.

The vacancy rate component and the

rents uncollected sub-indicator are

removed from the Management

Operations Indicator as a result of the

Department’s consideration of public

comments from the June 22, 1999,

PHAS Amendments Proposed Rule (54

FR 33348). These factors are assessed

under the Financial Condition Indicator

through the ‘‘occupancy loss’’ and

‘‘tenant receivable outstanding’’

components, and the inclusion of these

factors under both the Financial

Condition Indicator and Management

Operations Indicator was duplicative.

These changes ensure that the PHAS is

an effective and efficient assessment

system by eliminating any duplicative

efforts of information collection under

the PHAS.

There are certain differences between

the PHMAP score and the PHAS score

calculated for a PHA’s management

operations. Under the PHAS, PHA

requested modifications and exclusions

no longer apply. Under the PHAS, a

PHA will not be assessed under a subindicator and/or component if the PHA

does not receive funding for that

program, i.e., Capital Fund. PHAs will

certify to sub-indicator #2, Capital

Fund, and all PHAs will certify to and

be scored on sub-indicator #5, security,

and sub-indicator #6, economic selfsufficiency, under PHAS Management

Operations Indicator #3.

3. Submission of Management

Operations Certification

Under the PHAS, a PHA is required

to electronically submit certification on

its performance under each of the

Management Operations sub-indicators.

If circumstances preclude a PHA from

reporting electronically, HUD will

consider granting short-term approval to

allow a PHA to submit its Management

Operations certification manually. A

PHA that seeks approval to submit its

certification manually must ensure that

the REAC receives a request for manual

submission in writing 60 calendar days

prior to the submission due date of its

Management Operations certification.

The written request must include the

reasons why the PHA cannot submit its

certification electronically. The REAC

will respond to such a request and will

manually forward its determination in

writing to the PHA.

Federal Register / Vol. 65, No. 125 / Wednesday, June 28, 2000 / Notices 40029

4. Elements of Scoring

The Management Operations

Indicator score provides an assessment

of each PHA’s management

effectiveness. The computation of the

score under this PHAS Indicator utilizes

data that was submitted for PHMAP and

requires three main calculations, which

are:

• Scores are first calculated for all of the

components that have been submitted by

the PHA;

• Based upon the component scores, a score

is then calculated for each sub-indicator;

and

• From the six sub-indicator scores, an

indicator score is then calculated.

The three calculations are performed

on the basis of the following:

• The point values of the six sub-indicators

and/or components, which are listed in

Table 1; and

• The multiplier value equivalent to the

grades assigned under PHMAP listed in

Table 2.

TABLE 1.—MANAGEMENT OPERATIONS SUB-INDICATOR AND COMPONENT POINTS

Sub-indicator Sub-indicator points Component Component

points

Vacant Unit Turnaround Time .......................................... 4.0 ....................

Capital Fund ...................................................................... 7.0 Unexpended Funds .......................................................... 1.0

Timeliness of Fund Obligation ......................................... 2.0

Contract Administration .................................................... 2.0

Quality of Physical Work .................................................. 1.0

Budget Controls ............................................................... 2.0

Work Orders ...................................................................... 4.0 Emergency Work Orders ................................................. 2.0

Non-Emergency Work Orders .......................................... 2.0

Inspections of Units and Systems .................................... 4.0 Inspection of Units ........................................................... 2.0

.................... Inspections of Systems .................................................... 2.0

Security ............................................................................. 4.0 Tracking/Reporting Crime-Related Problems .................. 1.0

.................... Screening of Applicants ................................................... 1.0

.................... Lease Enforcement .......................................................... 1.0

.................... Grant Program Goals ....................................................... 1.0

Economic Self-Sufficiency ................................................ 7.0 ....................

The PHMAP grades for each

component are assigned values to

indicate the percentage of the

component points that will be awarded

in the calculations. The assigned values

for the PHMAP grades are listed in

Table 2. Note that some components are

only graded on A, C, and F.

TABLE 2.—POSSIBLE GRADES

Grades Value

A ................................................... 1.00

B ................................................... 0.85

C ................................................... 0.70

D ................................................... 0.50

E ................................................... 0.30

F .................................................... 0.00

Calculations under the PHAS

Management Operations Indicator are

performed as follows:

Component Score. The component

score equals the component’s total

possible points multiplied by the value

of the grade for the PHA. For example,

a PHA with an equivalent grade of E for

the component, ‘‘inspection of units,’’

would receive 30% of the total possible

component points of 2, for a score of 0.6

for the component. When non-assessed

components exist, the value of the nonassessed component must be

redistributed proportionately across

components that have been assessed.

Sub-indicator Score. The subindicator score is the obtained by

adding the redistributed component

scores. When non-assessed Subindicators exist, the value of the nonassessed sub-indicator must be

redistributed proportionately across the

sub-indicators that have been assessed.

Note that if the value of a sub-indicator

is changed because of redistribution of

non-assessed points, the values of the

components of that sub-indicator must

be redistributed again. This component

redistribution does not change the value

of the sub-indicator, it simply ensures

that the sum of the components equals

the new sub-indicator value.

Indicator Score. The Indicator score is

determined by adding the sum of the

sub-indicators.

5. Examples of Score Computations

An Example of Computing a SubIndicator Score With a Non-Assessed

Component. Table 3 provides an

example for the calculation of a Capital

Fund sub-indicator score and its

component scores when the Quality of

Physical Work component has not been

assessed. When non-assessed

components exist, the value of the nonassessed component must be

redistributed proportionately across

components that have been assessed. In

our example, the Capital Funds

component, Quality of Physical Work, is

not assessed. To redistribute the Quality

of Physical Work points, each assessed

component must be multiplied by the

total possible points for the subindicator (7), and divided by the total

possible points of the assessed

components (5). The redistributed value

of the total possible points for the

Contract Administration component is

calculated to be 1.4. In our example, the

PHA has received a grade of C for

Contract Administration; the PHA then

receives only 70% of the redistributed

points value for Contract

Administration. As shown in Table 3,

70% of 1.4 equals 0.98 points. The

Capital Fund sub-indicator score is then

computed by summing the redistributed

components. In the example from Table

3, the final score for the Capital Fund

sub-indicator is 6.2 (6.16 rounded to the

nearest tenth).

40030 Federal Register / Vol. 65, No. 125 / Wednesday, June 28, 2000 / Notices

TABLE 3.—EXAMPLE ASSESSMENT OF THE CAPITAL FUND SUB-INDICATOR

Component

Total possible

component

points

Assessed

component

points

Redistribution calculation

Redistributed component

points

Grade Grade

value

Score calculationComp.

score

#1 Unexpended Funds ........................... 1.0 1.0 (1.0×7.0 )/5.0 1.4 A 1.0 1.4×1.0 1.4

#2 Timeliness of Fund ............................ 2.0 2.0 (2.0×7.0 )/5.0 2.8 A 1.0 2.8×1.0 2.8

#3 Contract Administration ..................... 1.0 1.0 (1.0×7.0 )/5.0 1.4 C 0.7 1.4×0.7 0.98

#4 Quality of Physical Work ................... 2.0 NA NA NA NA NA NA NA

#5 Budget Controls ................................. 1.0 1.0 (1.0×7.0 )/5.0 1.4 C 0.7 1.4×0.7 0.98

Total (Sub-indicator Score) .......... 7.0 5.0 .................................... 7.0 ................ ................ ........................ 6.16

An Example of Computing the

Management Operations Indicator Score

for a PHA Without an Economic SelfSufficiency Program. Table 4 provides

an example for the calculation of the

Management Operations Indicator score

when the Economic Self-Sufficiency

sub-indicator has not been assessed (the

PHA does not have a HUD-funded

Economic Self-Sufficiency Program).

When a non-assessed sub-indicator

exists, the value of the non-assessed

sub-indicator must be redistributed

proportionately across the subindicators that have been assessed. To

redistribute the Economic SelfSufficiency points, each assessed subindicator must be multiplied by the total

possible points for the MASS indicator

(30), and divided by the total possible

points of the assessed sub indicators

(23). This calculation and the

redistributed value of the total possible

points for each sub-indicator is shown

in Table 4. The final Management

Operations Indicator score is derived by

summing the redistributed subindicators.

These scores are included in the

PHAS Report. Note that in the PHAS

Report, scores are rounded to the

nearest tenth.

TABLE 4.—EXAMPLE OF ASSESSMENT OF THE MANAGEMENT OPERATIONS INDICATOR SCORE FOR A PHA WITHOUT AN

ECONOMIC SELF-SUFFICIENCY PROGRAM

Sub-indicator

Total possible

sub-indicator

points

Total possible

assessed subindicator

points

Actual sub-indicator scoreRedistribution

calculation

Redistributed

sub-indicator

points

Vacant Unit Turn-Around Time ................................ 4 4 4 (4 × 30)/(23) 5.2

Capital Fund ............................................................. 7 7 6.16 (6.16 × 30)/(23) 8.03

Work Orders ............................................................. 4 4 4.0 (4 × 30)/(23) 5.2

Annual Inspection .................................................... 4 4 2.8 (2.8 × 30)/(23) 3.65

Security .................................................................... 4 4 4.0 (4 × 30)/(23) 5.2

Economic Self-Sufficiency ....................................... 7 NA NA NA NA

Total Management Operations Indicator

Points ......................................................... 30 23 NA NA 27.28

An Example of Rescaling Components

So that the Component Sum Equals a

Redistributed Sub-indicator. In the

previous example, the sub-indicator

points were redistributed because the

Economic Self-sufficiency sub-indicator

was not assessed. After the subindicator points were redistributed the

components comprising the subindicator no longer added up to the

redistributed value of the sub-indicator.

A calculation must be performed to

rescale the components of a subindicator so that those components add

up to the redistributed sub-indicator.

Table 5 contains an example of rescaling

the Capital Fund components so that

they add up to the redistributed Capital

Fund sub-indicator. Each component is

rescaled by multiplying by a factor of 30

divided by 23. As can be seen from

Table 5, the rescaled component values

add up to 8.03 which is the

redistributed sub-indicator points for

Capital Funds as shown above in Table

4.

TABLE 5.—EXAMPLE REDISTRIBUTION OF COMPONENTS WITHIN THE CAPITAL FUND SUB-INDICATOR

Component

Component

values after

first redistribution in table 3

Component rescaling

calculation

Component

values after

rescaling

#1 Unexpended Funds .................................................................................................... 1.4 1.4 × (30/23) 1.82

#2 Timeliness of Fund Obligation .................................................................................... 2.8 2.8 × (30/23) 3.65

#3 Contract Administration .............................................................................................. 0.98 0.98 × (30/23) 1.28

#4 Quality of Physical Work ............................................................................................ NA NA NA

#5 Budget Controls .......................................................................................................... 0.98 0.98 × (30/23) 1.28

Total Sub-Indicator Score ..................................................................................... 6.16 8.03

Federal Register / Vol. 65, No. 125 / Wednesday, June 28, 2000 / Notices 40031

Dated: June 20, 2000.

Donald J. LaVoy,

Director, Real Estate Assessment Center.

[FR Doc. 00–16156 Filed 6–27–00; 8:45 am]

BILLING CODE 4210–01–P