Update To Utility Allowance Regulations

Utility Allowances

HUD provides utility allowances to properties receiving subsidy assistance where all or some utilities are paid directly by the residents. Utility allowances (UA) represent the owner’s best estimate of an energy-conscious resident’s average monthly utility cost based on an analysis. To determine the UA for the property, owners must perform a yearly analysis of their project’s utilities or receive the annual FY Utility Allowance Factor (UAF) increase set by HUD annually. One must be submitted with any rent adjustment type, including rents remaining at the current.

The HUD-published Housing Notice can be found here: Notice 15-04. Select the link to see the Frequently Asked Questions for the Housing Notice 2015-04. 

24 CFR 245.405(a) and 245.410 require the owner to serve the residents with a 30-day notice of a proposed decrease in the utility allowance. Select here for a sample Utility Decrease Notice.

HUD Utility Allowance Schedule

The utility allowance factor table and utility allowance schedule for the upcoming period are now accessible from the Department of Housing and Urban Development. The dataset relies on data published by the U.S. Energy Information Administration and the Bureau of Labor Statistics. Owners or agents will establish their utility allowance factor (UAF) specific to their state and apply the published UAF to their current utility allowance as part of their adjustment process. The data sets include oil, natural gas, electric, and water/sewer/trash.

Utility Allowances FAQ

Have questions about the HUD utility allowances for housing? Please contact us! We’re happy to provide clarity and more information.