Changes to federal law now allow rents to be set at levels other than the traditional 30% of adjusted income. The law requires PHAs to impose minimum rents of up to $50 per month. Hardship exemptions are allowed; grounds include a household’s inability to pay the minimum rent due to a loss of government assistance, a household’s facing eviction due to an inability to pay the minimum rent, and other reasons as determined by the PHA.
PHAs are required to notify households of the possible exemptions and to suspend charging minimum rents to households that request an exemption. If there is long-term (i.e., over 90 days) hardship, an exemption should be granted. If the hardship is only temporary, the PHA should offer the tenant a reasonable repayment plan for any suspended rents or missed payments.1
PHAs can also opt to charge a rent based upon the “rental value” of the unit instead of the tenant’s income. This type of rent is called a “flat rent.” A tenant is given an annual choice to either pay a flat rent or an income-based rent. PHAs must advise tenants in writing of the amount of the income-based rent and the flat rent. If a flat rent is chosen and the resident has a loss of income, the resident can request a switch to income-based rent.2 Tenants paying a flat rent cannot receive a utility allowance.3