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UA Methodology  

HUD Notice 2015-04 outlined a new methodology for owners/agents on completion of a Utility Allowance.  If your property as a Utility Allowance, you will want to be sure that you understand the requirements so that you can submit a compliant baseline submission to AHSC during the contract renewal or rent adjustment process.  It is important to note that the information included in this publication is not all encompassing.  Refer to the notice and subsequent HUD published FAQ’s for completion HUD guidance regarding utility allowance baseline requirements.


Step One: Determine the required sample size.  HUD outlines the minimum sample size in Figure 1 of HUD notice 2015-04.  This chart shows the minimum sample size per unit type.  You must include an explanation if you are unable to meet the minimum sample size requirements (i.e. high vacancy turnover).  It is your responsibility to demonstrate that every effort has been made to meet the requirements of the notice.

Number of Units

Minimum Sample

1 – 20


21 – 61


62 – 71


72 – 83


84 – 99


100 – 120


121 – 149


150 – 191


192 – 259


260 – 388


389 and above


Step Two: Obtain your samples.  It is acceptable for you to receive and utilize multiple forms of documentation to support the baseline analysis.  You can obtain data from the resident, the utility company, a third party provider, or a combination of the three.  You must submit all of the backup documentation to support how the new UA was calculated, this includes:

  • Copies of the tenant data received from utility providers, usually in summary format

  • Copies of printouts indicating a summary of monthly data if there tenant was able to obtain the data online or from the utility provider

  • You can submit a spreadsheet summarizing the average of the monthly utility bills.  The actual utility bill will not need to be submitted to the CA, but must be retained in the tenant files for the term of tenancy plus three years and will be subject to HUD/CA review

  • A combination of the above may be submitted

Step Three: Determine if your samples are compliant.  Certain units should be excluded from your sample:

  • Those units receiving a UA as part of a reasonable accommodation.

  • Those units having been vacant for 2 or more months.  Units included in the sample should have at least ten months of occupancy.

  • Those units receiving a flat utility rate as part of a low-income rate assistance program.  An exception to this would be if all tenants at the property were receiving flat rate utility assistance.


Step Four: Use HUD’s sample UA worksheet or other calculation worksheet that uses HUD’s formulas for calculating the averages.  Attachment A of HUD notice 2015-04 is HUD’s sample UA worksheet.  The password to unlock this excel worksheet is Sharkey.  AHSC recommends that owners/agents unlock the excel worksheet in order to rename the unit numbers going vertically down the spreadsheet to match the units in your submission, and rename the months listed horizontally to correspond with the data that you collected.


Step Five: Submit your Baseline to AHSC.  When AHSC receives a baseline Utility Allowance, we complete a preliminary compliance check using the following criteria:

  1. The baseline methodology utilized did not eliminate the highest and lowest averages per unit

  2. There are at least ten months of data included in the average(s).  An explanation must be provided if there is not at least ten months of data provided

  3. The required minimum number of samples is included in the baseline submission.

    1. If the required minimum is not included in the baseline submission, the owner/agent has provided an adequate explanation as to why the sample size is deficient

  4. The data included in the baseline analysis is not greater than 18 months from the contract anniversary date


When reviewing your baseline submission for compliance, if AHSC is unable to answer the questions listed above, you may be asked to provide further clarification and/or documentation.  You can work directly with your CCS if you have any questions over what should be submitted to fulfill your baseline requirement.


Remember, if there is a decrease to the Utility Allowance, owners/agents must follow the requirements of 24 CFR Part 245.405(a) and 245.410 regarding notice to tenants.  AHSC will require both a copy of the notice provided to the tenants as well as the owner/agent certification of compliance with the tenant comment period.

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