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<br />Page | 51 <br /> <br />8.4 Determining Rent Subsidy <br />Lead/subgrantees must have a standardized procedure for determining the amount of rent subsidy for <br />each household receiving rent assistance, this includes Transitional Housing. At minimum, the CHG <br />Rent Subsidy Calculation Tool or another tool approved by Commerce must be used to document the <br />determination process. <br /> <br />The procedure must align with progressive engagement14, where services are client-driven, and each <br />household’s unique circumstances are considered. In the rent subsidy determination process, this must <br />include a consideration of each household’s resources/net income, expenses, and barriers to housing <br />stability. Although the procedure for determining the subsidy must be standardized , each household <br />may receive a different amount of rent subsidy. <br /> <br />This means the assessment questions used to determine the rent subsidy must be the same for all <br />households, but each household’s contribution will be different depending on the household’s <br />resources and expenses. Grantees must use household net income (after taxes, deductions, and <br />garnishments) when determining rent subsidy. <br /> <br />The rent subsidy should be adjusted when there is a change in household circumstance, income, or <br />need. At minimum, rent subsidies should be reviewed during 90-day income recertification and <br />alongside housing stability planning. <br /> <br />Households receiving TANF or GA/ABD benefits must not be obligated to contribute their cash benefits <br />towards rent. An exception can be made if the rent amount exceeds the maximum limits established <br />by the grantees rent limit policy. <br /> <br />If lead/subgrantees utilize other contracted funding alongside CHG which requires a different rent <br />subsidy determination process, notify Commerce to discuss compliance with this section; exceptions <br />may be made as appropriate. <br />8.5 Payment Standards to Determine Rent Limit <br />Lead/subgrantees must choose either the HUD Fair Market Rent or the Rent Reasonableness payment <br />standard to be used for all units receiving a rent subsidy, including arrears, and must be completed <br />before the rent subsidy is paid. <br /> HUD’s Fair Market Rent <br />Fair Market Rent (FMR) sets rent limits on the subsidy provided to the household. FMR is established <br />by HUD (https://www.huduser.gov/portal/datasets/fmr.html ) and is updated each federal fiscal year <br />(October 1). For this grant, rent calculations do not need to include the cost of utilities. <br /> <br />If a hotel/motel room is being used as permanent housing, compare it to a studio/efficiency unless the <br />room is a suite with separate bedrooms. <br /> <br />If mobile home lot fees are used to place a personal mobile home, compare it to the equivalent size <br />unit. For example, RVs use studio/efficiency, two bedroom mobile home use two bedroom unit, three <br /> <br />14 See Section 7.4 for definition of progressive engagement. Note: A policy requiring all households to pay 30% of their income, or <br />any other calculation that requires a standard contribution for each household, is not in compliance with grant terms.