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Res 053-2006 4/4/2006 s RESOLUTION NO. ��� - �OCp RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WICHITA FALLS, TEXAS, AUTHORIZING AMENDMENTS TO THE HOUSING CHOICE VOUCHER PROGRAM PHA PLAN AND ADMINISTRATIVE PLAN; FINDING AND DETERMINING THAT THE MEETING AT WHICH THIS RESOLUTION WAS PASSED WAS OPEN TO THE PUBLIC AS REQUIRED BY LAW. WHEREAS, the City Council conducted a Public Hearing on this topic at their March 21, 2006 City Council meeting; and WHEREAS, an amendment to the PHA Plan is proposed to allow project-based vouchers; and WHEREAS, amendments to the Administrative Plan are proposed for project- based vouchers and income verification of applicants and tenants. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WICHITA FALLS, TEXAS, THAT: SECTION 1 . Amendments to the PHA Plan and Administrative Plan are hereby approved. SECTION 2. It is hereby officially found and determined that the meeting at which this resolution was passed was open to the public as required by law. PASSED AND APPROVED this the 4th day of April, 2006. MAYOR ATTEST: ity Clerk Proposed Amendment to the PHA Plan 10. Proiect-Based Voucher Pro�ram a. � Yes ❑ No: Does the PHA plan to "project-base" any tenant-based Section 8 vouchers in the coming year? If yes, answer the following questions. b. � Yes ❑ No: Are there circumstances indicating that the project basing of the units, rather than tenant-basing of the same amount of assistance is an appropriate option? If yes, check which circumstances apply: � Low utilization rate for vouchers due to lack of suitable rental units � Access to neighborhoods outside of high poverty areas � Other (describe below:) Project Basing of units will increase long-term affordability and expand housing opportunities for low-income families. c. Indicate the number of units and general location of units (e.g. eligible census tracts or smaller areas within eligible census tracts): The first round of Project based units will consist of no more than 20 units in an eligible census tract in the city. ADDENDUM TO THE PHA'S CURRENT SECTION 8 ADMINSTRATIVE PLAN REGARDING PROJECT-BASED VOUCHERS INTRODUCTION On October 27, 2000, the President signed into law the Fiscal year 2001 Department of Veterans Affairs and Housing and Urban Development and Independent Agencies Appropriations Act (Pub. Law 106-377,144 Stat. 1441) ("Appropriations Act") Sections 232 of the Appropriations Act substantially revises the provisions of the U. S. Housing Act of 1937 that govern the authority of a PHA to designate a portion of it available tenant-based voucher funds for project- based assistance (see U.S.C. 1473f(0)(13) (as amended by "Section 232" of the Appropriation Act). The Conference Report on the Appropriations Act stated that the statutory changes to the Project based Voucher (PBV) Program are intended to make project- basing of voucher assistance more flexible. HUD's initial guidance published in the January 16, 2001, Federal Register shows that consistent with legislative intent, it is also HUD's objective to make the PBV Program more flexible and more workable, and to help PHA's owners, and eligible families in need of housing take immediate advantage of the new statutory features. The Addendum to the Wichita Falls Housing Authority's (PHA) Section 8 Administrative Plan is its statement to operate a Project-Based Assistance (PBA program and to provide information on how it intends to operate the PBA under the requirements of the new law and regulations at 24 CFR part 983. This Addendum also provides information to eligible families, owners, and other interested members of the public. This Addendum is based on regulations at CFR Part 983 and Section 232 and HUD's initial Guidance Notice, dated January 8, 2001, identifying which elements of the new project-basing law are effective immediately and states how the PHA is implementing the law pending issuance of revised program regulations. In the event of changes required to this addendum because of future rule making concerning the PBV Program, the PHA will take all reasonable steps to comply with new rules without jeopardizing actions previously taken that are consistent with HUD's Initial Guidance and Section 232. PROVISIONS OF THE PHA's PBA PROGRAM Except where this section specifies otherwise, the present project-based regulations at 24 CFR part 983 continue to apply to newly constructed and substantially rehabilitated housing and now also apply to existing housing. Upon determination of good cause and subject to statutory limitations, the PHA may seek a waiver from HUD for an provisions of the applicable project- based regulations in accordance with 5 CFR 5.110. A. Authorization to Provide Project Based Vouchers (PVB) Consistent with regulations in 24 CFR Part 983 and Section 232 and HUD Guidance, the PHA from time to time may enter into Housing Assistance Payments (HAP) contracts that attach PBV assistance to newly constructed units, rehabilitated units, and existing housing units that fully meet the HCV Program Housing Quality Standards (HQS) (see 24 CFR 982.401). A housing unit will be considered an "existing unit" for purposes of the PBV Program if, at the time of the PHA written notice of selection of the project for project-based assistance, the units required a maximum expenditure of less then $1,000 per assisted unit (including the unit's prorated share of any work to be accomplished on common areas of systems) to comply with the HQS. B. Unit Selection Policy, Advertising, and Owner Application Requirements The PHA shall advertise the availability of the PBA with such advertisements must meet standards comparable to those in 24 CFR 983.51(b) and HUD's initial guidance notice. The PHA will advertise in a newspaper of general circulation that the PHA will accept applications for PBA. The advertisement will be published once a week for three consecutive weeks: specify an application deadline of at least 30 days after the date of the advertisement is last published. The advertisement will reference the availability of a Request for Proposals (RFP) and the source from whom the RFP can be obtained. The RFP will specify the number of units the PHA estimates that it will be able to assist under the funding the PHA is making available for this purpose: and state that only applications submitted in response to the advertisement will be considered. The RFP will also state the PHA is making available for this purpose; and state that only applications submitted in response to the advertisement will be considered. The RFP will also state the PHA selection policies. In all cases, the PHA will maintain documentation of responses to advertisements or competitive proposals received in response to the PHA notice. C. 20 Percent Limit The total cumulative number of project-based units, including units previously placed under HAP in the PHA's project-based certificate program will not exceed 20 percent of the baseline number of units in the PHA's voucher program. D. Consistency With PHA Plan The PHA will submit an attachment to the PHA Plan template, or as an amendment to the PHA Plan, depending on the circumstances, a statement of the projected number of project-based units and general locations and how project basing would be consistent with their PHA Plans. As with all programs that are covered by the PHA Plan, the PBA will be carried out in conformity with the nondiscrimination requirements specified in the PHA Plan regulations, and will affirmatively further fair housing as required by the PHA Plan regulations. E. Consistency with the Goals of Deconcentrating Poverty and Expanding Housing and Economic Opportunities. The PHA PBA Program will be consistent with the goals of deconcentrating poverty and expanding housing opportunities. The PHA recognizes the HUD deconcentration of poverty requirements that PBA assistance agreements or HAP contracts be for units in census tracts with poverty rates of less than 20 percent, unless HUD specifically approves an exception. F. Partially Assisted Building Requirements The PHA will not enter into an agreement or HAP contract to provide PBV assistance for more than 25 percent of the units in any one building, except for single-family dwellings and projects for elderly families and disabled families. In accordance with existing program usage, single- family dwellings refer to 1-4 family dwellings. G. Family Choice to Move with Continued Assistance The new law provides that assisted families may move from the assisted buildings, and retain federal housing assistance. For the continued assistance option, Section 232, similar to existing 24 CFR 983.206 (d)(2) required for new HAP contracts that the owner permit the assisted tenants to move from the housing at any time after the family has occupied the dwelling unit withy PBV assistance for 12 months. Consistent with the law, the PHA will provide the family with HCV assistance or such other tenant-based rental assistance that is subject to comparable income, assistance, rent contribution, affordability and other requirements. HUD will set the standards as to what quality as comparable assistance by regulation. But, for new HAP contracts incorporating this requirement, the PHA will use voucher assistance available under the Annual Contributions Contract (ACC) to provide tenant-based assistance for the family. If no such assistance is available at the time the family moves, the PIHA will give the family priority to receive the next available tenant-based voucher. Vouchers under funding allocations targeted by HUD for special purposes (e.g. family unification, mainstream disabled) are not available for this purpose, since they axe required to be used only for the targeted purpose. H. HAP Contract Term Consistent with the law, a HAP contract between the PHA and an owner of housing under this program may have a duratuon of up to 10 years (as determined by the PHA), subject to the future availability of sufficient appropriated funds under the PHA's consolidated ACC with HUD. Upon expiration of the HAP contract term and consistent with the law, the PHA may agree with the project-based housing owner to extend the HAP contract for such period as the PHA determines appropriate to expand housing opportunities (as well as an extension to assure long- term affordability of the housing, as provided under prior law). All HAP contract extensions must be contingent upon the future availability of appropriated funds. I. Rent Limits The new law provides that the HAP contract shall establish gross rents (rent to owner plus the allowance for tenant-paid utilizes) that do not exceed 110 percent of the established Fair Market Rent ("FMR") or any HUD-approved "exception payment standard" (i.e., a payment standard amount that exceeds 110 percent of the published FMR) for the area where the housing is located. If a unit has been allocated low-income housing tax credits under the Internal Revenue Code of 1986 at 26 U.S. C. 42, but is not located in a qualified "census tract" as defined in the law, the rent to owner may be established at any level that does not exceed the rent charged for comparable units in the same building that receive the t� credit but do not have additional rental assistance. Within the limitations mentioned above, the initial rent to the owner may differ from payment standard amounts in the payment standard schedule adopted for the PHA tenant-based voucher program. However, just as in the regular tenant-based program and the PBA Program under prior law, the initial and adjusted rent to owner must be reasonable in relation to rents, charged in the private market for comparable unassisted units (see 42 U.S.C. 1437(� (o) (19) (A). J. Rent Adjustments During the Term of the HAP Contract Section 232 provides that a housing assistance payments contract for project-based voucher assistance shall provide for rent adjustments and that the adjusted rent for any assisted unit shall be reasonable in comparison with rents charged for comparable dwelling units in the private, unassisted local market and may not exceed the maximum rent limits permitted under the statutory limitations summarized above. Determination of whether rent is reasonable in relation to comparable units shall be governed by 24 CFR 983.256. K. Family Share of Rent and Housing Assistance Payment The housing assistance payment is calculated in accordance with 24 CFR 983.260 as the gross rent minus the total tenant payment. The family share is calculated in accordance with 24 CFR 983.261 by subtracting the amount of the HAP from the gross rent. L. Tenant Setection The PHA selection system for project-based units will comply with the requirements specified below, which in most respects (except for the income targeting provision) are a codification of present regulatory and contractual requirements. Income Targeting: The requirements of 42 U.S.C. 1437n(b) and CFR 982.201(b)(2) govern the selection of eligible families for this program, and generally provide that not less than 75 percent of families admitted annually to the PHA's combined tenant-based and PBV Programs shall be families whose incomes do not exceed 30 percent of the area median, as determined by HUD. Applicants may be selected from the PHA waiting list. The PHA will only maintain a separate project-based waiting list if all PHA tenant-based assistance applicants who seek project-based housing can be placed on this list upon request and without penalty to any other application for assisted housing they may have pending. Subject to its waiting list policies and selection preferences specified in the PHA Administrative Plan, the PHA may place a family referred by an owner on PBV units on its waiting list. In cases where the owner presents a plan to administer the waiting list on their own, the PHA may approve the owner to maintain the waiting list. In the case of a group home where supportive services are offered, the PHA will allow the service provider to manage their own waiting list subject to review by the PHA. Any waiting list maintained by an owner is subject to the income targeting requirements as prescribed by HUD. As in the current project-based program, the PHA will refer families to housing units from the waiting list according to its regular applicant selection policies. If an applicant does not rent a unit with PBA, or the owner turns an application down for admission to a project-based unit. The applicant will not be removed from the PHA's tenant —based assistance waiting list for that reason but must maintain its position on the list as though on offer of housing had been made. Vacant units; The HAP Contract will be in a form prescribed by HUD. The PHA may enter into such a contract that agrees to provide vacancy payments up to 60 days after a unit becomes vacant, in an amount not to exceed the rent to the owner as provided by the HAP contract on the day the family vacated. (Page 3610). The PHA mav only make such payments for a vacant unit if: 1. The vacancy was not the owner's fault, and 2. The PHA and owner take action to minimize the likelihood and length of any vacancy. M. Future Modification to this Addendum The PHA PBA Addendum will remain in effect until the new PBV changes in law have been fully implemented through a new regulation. In the event of changes required to this addendum because of future rulemaking concerning the PBV Program, the PHA will take all reasonable steps to comply with new rules without jeopardizing actions previously taken that are consistent with HUD's Initial Guidance and Section 232. HUD published a Proposed Rule for the Project Based Voucher (PBV Program in the March 18, 2004, Federal Register. HUD proposed comprehensive regulations for the new PBV Program. In the event of changes required because of future rulemaking concerning the PBV Program, the Housing Authority will revise the Agency Plan and Section 8 Administrative Plan to implement the new rule, and these revisions shall not be considered a significant amendment or modification. AMENDMENTS TO THE ADMINISTRATIVE PLAN - INCOME VERIFICATION 5. Verification of Income and Determination of Family RentT^+ Tonnn� Caor�� I During this phase of the certification process the applicants and participants will be informed by the staff that HUD has a computer-matching program in cooperation with � the IRS and Social Security Administration that can be used to compare the information in that database against information furnished by the family. HUD will notify both the tenant and the PHA of any income discrepancies and the tenant will be required to clear up any discrepancy noted. ��ir�--�'-a-�t�ue�+#+�a#+efl-ef-the � PNA _b�_�e- #a�il�--�all-be-da�e-b� � , �nfi41-� � Third party verification is the desired form of income verification. However, if the third party provider does not/will not provide the information after a follow-up contact bv the Housinq Counselor the PHA will consider other forms of verification after a two-week �eriod The file will be documented as ta the attempts to receive the third party verification. If these attempts are futile, the HA will accept copies of ariqinal pay stubs �preferably four consecutive, current stubs), or receipts of income or bank statements. The PHA will not accept self-certification of income. The verification process during the time of application, interim and annual reexamination is a critical task in the administration of the City's assisted housing programs. The City's Housing Office verifies all factors relating to eligibility determinations. These include: family composition and type, annual income, assets and asset income, child care and medical expenses, social security numbers, and citizenship or eligible immigration status. All verifications are valid for 60 days prior to issuance of a Voucher and 120 days for a re- exam. A quality control check is made of at least 10% of all files by the Housing Administrator. Required Consent The verification process requires the family to provide and disclose information that is true and complete. Each member of the family who is at least 18 years of age, and each family head and spouse, regardless of age, shall sign one or more consent forms including HUD Form 9886. The City will ensure that appropriate consent forms are used to obtain specific information. Verification of Income Information is verified through the five methods of verification acceptable to HUD in the following order: 1. Enterprise Income Verification (EI� 2. Third-party written verification 3. Third-party oral verification 4. Review of documents 5. Certification/self-declaration Up-Front Income Verification-Up-front income verification tools, including TASS, SWICA (State Wage Information Collection Agencies), and the Work Number, are utilized whenever possible. When HUD announces the availability of the EIV system for the City of Wichita Falls, the City will utilize additional EIV tools, including a centralized computer matching system. The State of Texas Child Support Interactive Website is utilized with written consent from the family, as well as automated state benefit call centers with written consent of the family. Use of Third-Party Verification to Supplement Enterprise Income Verification- Electronic income verification replaces, to the maximum extent possible, the more time-consuming and less accurate third-party verification process of contacting individual employers identified by families or reviewing outdated income verification documents. However, third-party verification may continue to be necessary to compliment electronic income veri�cation. Electronic income verification should not be considered an automatic substitute for other third-party verification. Rather, electronic income verification may supplement other verification documentation, such as original, current tenant-provided documents. Third-Partv Written Verification — Third-party verification is used to verify information directly with the source. Third-party written verification forms are sent and returned via mail, fax, or e-mail. The family is required to sign an authorization allowing the information source to release the specified information. One attempt to obtain third-party verification is made before relying on another method. Third-party verification forms, including computerized printouts, may not be hand carried by the family under any circumstances. The City will send request for third-party written verification to the source at all times regardless of whether the family provides a computerized printout. The City will allow two weeks for return of third-party verifications. If third-party verification is not used, the City will documents the reasons in the �le. For applicants, verification may not be more than 60 days old at the time of voucher issuance. For participants, they are valid for 120 days from date of receipt. Third-Partv Oral Verification — Oral third-party verification is used when written third- party veri�cation is delayed or impossible. When third-party oral veri�cation is used, staff is required to the tenant file, noting with whom they spoke, the date of conversation, and the facts provided. If oral third-party verification is provided by telephone, the staff person must originate the call. If third-party verification is not available, the City will compare the specified information to any documents provided by the family. Review of Documents — In the event that third-party written or oral verification is unavailable or information has not been verified by a third party within four weeks, the City will annotate the �le accordingly and utilize documents provided by the family as the primary source if the documents contain complete information. All such documents, excluding government checks, will be photocopied and retained in the family file. When documents cannot be photocopied, staff viewing the documents will document the tenant �le. The following documents will be accepted from families: • Printed wage stubs • Computer printouts from employers • Signed letters provided that the information is confirmed by phone • Official documents from federal, state or local agencies • Bank statements The City will not accept photocopies but will accept faxed documents. If third-party verification is received after documents have been accepted as provisional verification and there is a discrepancy, the City will contact the third-party source and family to resolve differences. The City will allow one week for families to provide documents when third-party verification is impossible to obtain. The City will not delay the processing of an application beyond 45 days because a third- party information provider does not return a verification in a timely manner. Self-Certification/Self-Declaration- When information cannot be verified by a third party or by review of documents, families will be required to submit a self-certification. Self- certi�cation means a notarized statement signed under penalty of perjury in the presence of a witness. The City will allow up to one week for a family to provide self-certification or self-declaration if other forms of verification are impossible to obtain. Nlany times the third party verification is received weeks or manths after the income determinatian. The Housing Courrselor(s) will review the informatian and campare the inc�me, hours� pay scale etc. to determine if the calculation of projected income is correct. If adjustments are necessary the tenant will be called in to recalculate the income. a). Defining Income And Sources Of Income. [Source: 24 CFR part 5.609-s��--�] � The federal regulations at 24 CFR 5.609 (a) determine what sources of income are counted and at 24 CFR 5.609 (b) what sources of income are not included in the calculations. Federal regulations require the PHA to project a tenant's income twelve manths into the future. One way to project income is to verify the income previously received. The PHA will use a variety of ways to logically and fairly predict a tenanYs rp oLected income. A tenant's income is to be verified b�r a third �arty and the Housinq Caunselor(s) will then arrive at a gross annual income. The qross annual income I�e: �#e--g���� �n�� T-;+-�ce�e-of a family is determined as a result of taking the amount received during varied pay periods and making the figure an annualized amount. To arrive at an annual income; (1.) use the monthly income as reported times twelve, (2.) take the weekly pay times 52 (weeks), (3). a payroll every two weeks is multiplied by 26, (4). amounts for paydays that occur twice a calendar month are calculated by taking the gross amount times 24, or (5). for incomes based on a hourly pay scale multiple by 2080 hours._The applicant or participant may be asked about any � overtime that they receive on a regular basis. Income tax returns can be viewed to verify persons that receive tips or that income from self-employment. Requlatians also require tenants to supply income information on the value of assets and income received fram assets. If a tenant receives payment of utilities or_other expenses from a third party or combination of third parties (such as relatives, friends, churches, United Way, or InterFaith Ministries, etc.) and thesepayments are on a recurring basis (more than three times in a one year period) the PHA must consider this as income This is income to the tenant regardless of whether the tenant made the payment or the benefactor made the pa_yment on the tenant's behalf. The tenant must disclase all income received from all sources or face termination fram the proqram for unreported or under-reported income. The PHA may, at their sole discretion, exclude income received for certain CDBG funded traininq programs. HUD may mandate other types of income to be excluded. If a tenant wishes to claim deductions for either childcare costs or medical costs as a�plicable it is the tenant's respansibility for providing the documentation for these expenses. Special Procedures For Verification of Erratic Child Support Income The full amount of child support payments awarded is counted as income unless it is verified that the payments are not being made. The following documentation is required to verify that the family receives less than the court ordered amount of child support: • Current print out from the child support enforcement agency indicating the dates and amount of payments actually received • If payments have stopped, faxed verification received from the State of Texas Attorney General's Office. This verification will provide the amount of the court ordered child support as well as the date and amount of the last payment actually received. • With family's written permission, information accessed on the internet through the State of Texas Child Support Interactive website which provides the date and amount of the last 12 payments made. Depending on the frequency of the payments, this will provide a three to twelve month payment history. (1). Child Care Expenses. Childcare expenses are amounts anticipated to be paid by a family for the care of children under 13 years of age if the care is necessary to enable a family member to do any of the following: actively seek employment, be gainfully employed, or further the member's education. More than one family member may be enabled to engage in any one of these qualifying activities for child care purposes. The City uses third-party written verification to verify childcare expenses by mailing a Child Care Verification Form directly to the childcare provider. Childcare expenses are deductible only to the extent that they are not reimbursed, they reflect reasonable charges for childcare, and the expenses incurred to enable a family member to work do not exceed the amount earned. Staff will compare the hours during which childcare is provided to the hours family members are working or engaging in one of the other qualifying activities to determine if child care is necessary to enable the qualifying activities. Child care expenses are only considered valid if 1) the income made available to the family_by the family member working or going to school exceeds the child care casts, 2) the child care enables a family member to wark or attend school and this is documented 3} there are no other adult household members that could atherwise �rovide this care, (remove per HUD) 3 the participant provides a statement (third party verification) from the chiid care provider that the participant actually paid for the child care, 4) If care is provided by an individual, r�ovide the name address rates charged� and their tax identification number or social security number that the incame with be reported to IRS. Payments over $600 in a year to an individual will require an a record of payment in the form of an IRS form 1099 or W2. .- � The City may use reasonable costs used by the local Child Care Management System as a guide in determining reasonableness for childcare expenses. (2). Medical Expenses. Those tenants that may have medical expenses will be informed on the best manner to document these expenses and reminded that these records can help to reduce their share on the rent. The medical expense deduction is permitted only for households in which the head or spouse is elderly or disabled. Medical expenses are expenses anticipated to be incurred during the 12 months following certification or reexamination which are not covered by an outside source such as insurance. The medical allowance is intended to anticipate regular, ongoing and anticipated expenses during the coming year. IRS Publication 502 is used as guidance in determining allowable medical expenses which may include: • Services of doctors and health care professionals • Services of health care facilities • Medical insurance premiums • Prescriptions and non-prescriptions if prescribed by a physician • Transportation to treatment • Dental expenses, eyeglasses, hearing aids, batteries • Live-in or periodic medical assistance • Monthly payment on accumulated medical bills. The allowance may include only the amount expected to be paid in the coming 12 months. The City will request third party written verification of inedical expenses. Privacy laws are making it more difficult to verify medical expenses, however. If a health care provider does not respond to a request for verification of a medical expense, the City may review tenant- provided documents. Disability Assistance Expense Deduction Families are entitled to a deduction for unreimbursed medical expenses to cover care attendants and auxiliary apparatus for each member of the family who is a person with a disability, to the extent necessary to enable any member of the family (including the member who is a person with disabilities) to be employed. This deduction may not exceed the earned income received by family members who are 18 years of age or older, and who are able to work because of such attendant care or auxiliary apparatus. When imposing the employment income ceiling, the City will consider: • If the assistance enables more than one person to be employed, the incomes of those persons will be combined to determine the ceiling • If an auxiliary apparatus enables the person with a disability to be employed and frees another person to be employed, the allowance cannot exceed the combined incomes of those two people. If both child care and a disability expense are needed to enable a person in the family to work, the employment income used to justify the child care allowance for employment purposes may not be used to also justify the disability assistance allowance. For example: The family pays: Child Care $100 per week Disability assistance $100 per week Total $200 per week The combined care enables an adult to work and earn $150 per week. The total for both the disability assistance allowance and the childcare allowance for employment purposes may not exceed $150 per week. The care and apparatus deduction includes, but is not limited to, the unreimbursed costs associated with: • Attendant care: In-home care, adult day care, nursing, housekeeping, personal care, and errand services, and interpreter for persons who are hearing impaired, or a reader for persons with visual disabilities. • Auxiliary apparatus: Including wheelchairs, walkers, scooters, ramps, adaptations to vehicles, service animals and special equipment to enable a blind person to read or type. The cost of maintenance and upkeep of the auxiliary apparatus is also included. (3). Family and Income Information �� AAt both certification and reexamination, tenants will be briefed that the level of their assistance is based on the information they provide about their income, their family size, number of reported dependents, child care, income assets or medical expenses combined with handicapped/disabled expenses. The tenants will be reminded that they are required to provide correct information. The participants are reminded that information given now and for all future changes must be in writing. � Verification Mandatory Deductions In determining adjusted income, the City is required to deduct the following amounts from annual income: • $480 for each dependent •$400 for any elderly or disabled family • The sum of the following, to the extent that the sum exceeds 3% of annual income: o Unreimbursed medical expenses of any elderly or disabled family; and o Unreimbursed reasonable attendant care and auxiliary apparatus expenses for each member of the family who is a person with disabilities, to the extent necessary to enable any member of the family to be employed. • Any reasonable childcare expenses necessary to enable a member of the family to be employed or to further his or her education. Dependent Deduction A dependent is a family member other than the head or spouse (except foster children and foster adults) who is any of the following: under 18 years of age, a person with a disability, a full time student who is 18 years of age or older. Minor status is verified with a birth certificate (certified copy or hospital issued), and social security card showing name, sex, social security number, date of birth and relationship to head of household. Full time student status is verified by written third-party verification using the City's Full Time Student verification form mailed to the educational institution. The institution defines what full-time student means for its student population. Options which may be used for verifying full-time student status include: oral third party verification by contacting the institution's registrar's office, a current enrollment status letter showing the school's name and address, dates of enrollment and total number of classes or credits attempted in a given quarter or semester. Verification requests should be mailed directly to the school and completed verification should be received directly from the school. Deduction for Disabled Families A disabled family is a family whose head, spouse or sole member is a person with disabilities. Disability status will be verified in the same manner as described above. Deduction for Elderly Families An elderly family is a family whose head or spouse is at least 62 years of age. Elderly status can be verified by birth certificates and social security cards. Third party written verification of social security benefits received from the local SSA office contains the birth date of the recipient. These can be used to verify birth date in place of a birth certificate. Verification of Assets Family Assets The City will utilize the current balance for savings and checking accounts. The City will require the information necessary to determine the current cash value of a family's assets (the net amount the family would receive if the asset were converted to cash). To document an asset, a third-party verification form is mailed or faxed by the City directly to the financial institution. If third-party verification is not available, the following may be accepted: • Letters or documents provided directly by the financial institution or broker • Passbooks, checking account statements, certificates of deposits, bonds, or financial statements supplied by a family if completed by a financial institution or broker • Real estate tax statements if the approximate current market value can be deduced from them • Financial statements for business assets • Copies of closing documents showing selling price and distribution of sales proceeds • Appraisals of personal property held as an investment • A family's self-certification describing assets or cash held at the family's home or in safe-deposit boxes Assets Disposed of for Less Than Fair Market Value During Two Years Preceding Effective Date of Certi�cation or Recertification At admissions and reexaminations, the City will obtain each family's certification that it has or has not disposed of assets for less than fair market value during the two years preceding the effective date of the certification or recertification. If the family certifies that it has disposed of assets for less than fair market value, the certification must show: (a) all assets disposed of for less than fair market value, (b) the date they were disposed of, (c) the amount the family received for each asset, and (d) the market value of each asset at the time of disposition. Third-party verification will be obtained whenever possible. Income From Assets Savin�s or Checkin� Account Interest and Dividend Income- Acceptable methods of verifications include, in this order: • City verification forms filled out or other statements supplied by the financial institution or, if these are not available, account statements, passbooks, or certificate of deposit statements supplied by the family • Broker statements showing the value of stocks or bonds and the earnings credited to the family. (Earnings can also be obtained from current newspaper quotations or orally for brokers.) • IRS Form 1099 from a financial institution provided that the City adjusts the information to project earnings expected for the next 12 months. Interest Income from Mort�age and Similar Arrangements- Acceptable methods of veri�cation include, in this order: • A letter received directly from an accountant, attorney, real estate broker, the buyer, or a�nancial institution stating the interest due for the next 12 months. (A copy of the check paid by the buyer to the family is not sufficient unless the breakdown of interest and principal is shown.) • An amortization schedule showing interest for the 12 months following the effective date of certification or recerti�cation. Net Rental Income from Propertv Owned by Farnily- Acceptable methods of verification include, in this order: • IRS Form 1040 with Schedule E(Rental Income) • Copies of latest rent receipts, leases, or other documentation of rent amounts • Documentation of allowable operating expenses of the property: tax statements, insurance invoices, bills for reasonable maintenance and utilities, and bank statements or amortization schedules showing monthly interest expense. • Lessee's written statement verifying rent payments to the family and the family's self-certification of net income realized