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Asset Management Update

Asset Management Update. Julie Miles, Financial Analyst HUD-Kansas City, KS 913-551-5529. Agenda. New FDS New Proposed PHAS Asset Management Delay: PHAs With 250-400 Units. New FDS Format. AMP Level Financial Reporting

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Asset Management Update

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  1. Asset Management Update Julie Miles, Financial Analyst HUD-Kansas City, KS 913-551-5529

  2. Agenda • New FDS • New Proposed PHAS • Asset Management Delay: PHAs With 250-400 Units

  3. New FDS Format • AMP Level Financial Reporting • Operating Fund and Capital Fund Reporting at AMP Level vs. PHA Level • 1 Balance Sheet per AMP – Operating Fund & Capital Fund Combined • 2 Income Statements per AMP – Operating Fund & Capital Fund Separate • New Columns • AMP & COCC Columns Replace Low-Rent and CFP Columns • Elimination Column Subtracts Internal COCC/AMP Transactions from Entity-Wide Totals • New 5-Digit Line Number Format for Revenues & Expenses

  4. New FDS Line Items & Detail Links • FDS Line Definition Guide October 2008 • http://www.hud.gov/offices/reac/products/fass/fass_pdf/fds_ln_def_gd_2008.pdf • Fee Revenues & Fee Expenses Line Items • Expense Line Items: Other Operating-Administrative, Sewer, Insurance Premiums • Memo Accounts: Excess Cash & CFP Expenditure Data • Ordinary Maintenance & Operations-Contract Costs: Garbage & Trash Removal, Heating & Cooling, Snow Removal, Elevator Maintenance, Landscape & Grounds, Unit Turnaround, Electrical, Plumbing, Extermination, Janitorial, Routine Maintenance, Miscellaneous

  5. Transition Year Due Dates • Unaudited – Normally Due 2 Months After FYE • 6/30/08 , 9/30/08 & 12/31/08 Due 4/13/09 • 3/31/09 Due 6/30/09 • Federal Register Vol. 73, No. 163, 8/21/08 Docket FR-5227-N-01 • Audited • Expect System to Be Open in April • Due Dates Will Be Announced Once System Open • Electronically to REAC • Paper Copy to Field Office Financial Analyst

  6. New Proposed PHAS • Starting FYE 6/30/08 • First Year Transitional Scores • Proposed Rule http://www.hud.gov/offices/reac/products/phas/phasprule.pdf • First Year CFP Bonus Based on Previous PHAS Score • Scoring • 30 Physical Condition • 20 Financial Condition • 40 Management Operations • 10 CFP Management • No Resident Survey

  7. Proposed Physical Condition • Still 30 points • Scored at AMP Level Instead of Development • Same UPCS Inspection Criteria • Frequency Depends on AMP Score—Not PHA Score

  8. Proposed Financial Condition • 20 points • Scored at AMP Level • Most Indicators Moved to Management Operations • Based on Unaudited Financial Submission & Adjusted for Audited Financial Submission • Penalties • Significant Change Between Unaudited & Audited Financial Statements • Qualified, Adverse of Disclaimer of Audit Opinion • Audit Findings

  9. Proposed Financial Condition (continued) • 3 Sub-Indicators • (1) Quick Ratio (QR) • Formerly Current Ratio • Current Assets ÷ Current Liabilities • 9 points • (2) Months Expendable Net Assets Ratio (MENAR) • Formerly Months Expendable Fund Balance (MEFB) • (Current Assets - Current Liabilities) ÷ Average Monthly Operating Expenses • 9 points • (3) Debt Service Coverage Ratio (DSCR) • Adjusted Operating Income ÷ Annual Debt Service • If No Long-Term Debt, PHA Gets All Points • 2 points

  10. Proposed Management Operations • 40 points • Scored at AMP Level • Scoring Adjustments – 1 Point Each • Physical Condition – Projects 28 Years & Older • Neighborhood Environment – 40% or More Families Income Below Poverty Rate on Latest Census

  11. Proposed Management Operations (continued) • HUD On-site Review Instead of PHA Self-Certification • Includes Items Previously Scored Under Financial • 7 Sub-Indicators: • (1) General Appearance & Security • 1.1 Appearance & Market Appeal (5 points) • 1.2 Security (1 point) • (2) Follow-Up & Monitoring of Project Inspections • 2.1 Exigent Health & Safety Deficiencies (not scored) • 2.2 Lead-Based Paint Inspection Deficiencies (not scored)

  12. Proposed Management Operations (continued) • 7 Sub-Indicators (continued) • (3) Maintenance & Modernization • 3.1 Unit Inspections (1 point) • 3.2 Work Orders (3 points) • 3.3 Preventive Maintenance (1 point) • 3.4 Energy Conservation/Utility Consumption (1 point) • 3.5 Modernization (not scored) • (4) Financial Management • 4.1 Percentage of Accounts Payable (4 points) • 4.2 Rent Collection (4 points) • 4.3 Budget Management (not scored) • 4.4 Procurement (not scored)

  13. Proposed Management Operations (continued) • 7 Sub-Indicators (continued) • (5) Leasing & Occupancy • 5.1 Vacancy Rate (16 points) • 5.2 Turnaround Time (2 points) • 5.3 Occupancy Review (not scored) • (6) Tenant/Management Relations • 6.1 Economic Self-Sufficiency (1 point) • 6.2 Resident Involvement in Project Administration (1 point) • (7) General Management Practices • 7.1 Management Review Findings (not scored) • 7.2 Other Prior Review Findings (not scored) • 7.3 Insurance (not scored)

  14. Proposed CFP Management • 10 points • Scored at PHA-level, not AMP • Time to Obligate & Expend CFP for Grants with Fund Balances During Assessed Period

  15. Asset Management Delay • PIH Notice 2008-16 • 2008 Appropriations Act • Section 225 • PHAs 250-400 PH Units • Elect to Delay AM Implementation 1 Year • Report FDS at PHA-Level, not AMP-Level • Submit OpSub at AMP-Level, not PHA-Level • Excludes Stop-Loss • Assume Provision Will Continue in 2009 • If Not Continued, Guidance Will Be Provided

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