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Change in Definition of Extremely Low Income

Monday, July 14, 2014

HUD Implementation of Fiscal Year 2014 Appropriations Provisions:  Change in Definition of Extremely Low Income

The general provisions of the 2014 Appropriations Act published on Wednesday, June 25, 2014, include a statutory change in the definition of “extremely low-income”  applicable to multifamily project-based section 8 programs effective July 1, 2014.

The new provision now defines Extremely Low Income (ELI) families as very low-income families whose incomes do not exceed the higher of the Federal poverty level or 30 percent of Area Median Income. This change affects the ELI targeting requirements in section 16 of the 1937 Act (42 U.S.C. 1437n) for multifamily project-based Section 8 programs. As of the effective date of this notice, compliance with the targeting requirements under each of these programs must take into account the new definition of ELI.

Beginning July 1, Owner/Agents shall meet its targeting requirements through a combination of ELI admissions prior to the effective date (using the old definition) and ELI admissions after the effective date (using the new statutory definition). Owner/Agents may not skip over a family on the waiting list if that family meets the new definition of ELI as enacted by this section.

For the multifamily project-based section 8 programs, the contract administrator (i.e., HUD or a PHA under an Annual Contributions Contract with HUD) must make available for occupancy by ELI families not less than 40 percent of the section 8-assisted dwelling units that become available for occupancy in any fiscal year.

In some communities, the extremely low-income and very low-income levels will be identical for some or all household sizes, in which case Owner/Agents meet ELI targeting requirements by serving VLI households, since those families meet the new definition of ELI. HUD's Office of Policy Development and Research has calculated the new income limits for extremely low-income families and has made the new area income limits available online at http://www.huduser.org/portal/datasets/il/il14/index.html.

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