HUD's FY2001 Budget
Salaries and Expenses
Budget Activity 6: Policy Development and Research

SCOPE OF ACTIVITY

Personnel of the Office of Policy Development and Research (PD&R) are responsible for the management of research and technology studies conducted under contracts, cooperative agreements and grants, as well as in-house research, economic analyses, tax policy analysis, program evaluation and program monitoring, and policy development. PD&R is also responsible for international affairs duties for the Department.

Staff has provided the analytical skills and experience to address many of the key issues in HUD's Management Reform Plan such as assisting in the development of performance measures; targeting of the funds to assure attention to low-income families and vulnerable populations; assuring that questions of consistency of approach across program lines are addressed; and that a myriad of issues related to the new structure of HUD are carefully considered.

There are many PD&R functions which have not fundamentally changed under the Reform Plan, because they are rather independent of the Department's structure. Continued short range research on basic housing and urban issues to allow the Secretary to be a national spokesperson on these matters is one example. Longer range research, including the Partnership for Advancing Technology in Housing (PATH) initiative, the results of which will be available to future administrations, is another. The economic intelligence function, including the American Housing survey and related publications such as the quarterly U.S. Housing Market Conditions report, would also continue. Likewise, setting Fair Market Rents (FMR) and income limits, and assisting on HUD wide, special initiatives are ongoing functions of the Office.

Staff continues to provide extensive support to the Chief Financial Officer and Deputy Secretary on tasks related to the Government Performance and Results Act, including development of the Strategic Plan and the Annual Performance Plan.

Staff will work closely with the program offices and the Office of Information Technology to improve automated systems and the program data that reside in these systems, in order to support research and evaluations, and to assure that program managers throughout HUD's organization have the information needed to monitor results.

PD&R is also responsible for the examination of the outcomes of current HUD programs; the evaluation of program structure and operation in view of those outcomes; and the review of the continuing efficacy of programs.

Changes in FHA place increased responsibilities on PD&R to provide technical support to FHA and oversight for the Secretary. New ways of doing business requires careful up-front study, prompt and thorough evaluations. Actuarial studies, program design, and assessments of who FHA serves are areas where FHA and the Secretary need assistance. PD&R already has this capacity and has used it on several occasions. PD&R's analytical approach makes its advice particularly useful to FHA and the Secretary.

Staff will continue to provide support to the Secretary for mission regulation of Government Sponsored Enterprises (GSEs) activities including: (1) consideration of new program requests; (2) monitoring of GSE performance under geographical and income-based housing goals; (3) research support for establishment of ongoing GSE housing goals; (4) administration of fair housing requirements; and (5) writing annual reports to Congress.

Staff will also administer outreach and grant programs of the Office of University Partnerships, and will have responsibility for overseeing the Partnership for Advancing Technology in Housing (PATH) initiative.

Staff will continue studies and research leading to cooperation and the exchange of information and data with foreign governments and international organizations. International Affairs staff in PD&R are responsible for activities related to Central America hurricane relief as part of the Department's effort with the U.S. Agency for International Development.

Beginning in 1999 the economists who serve in HUD field offices formally report to PD&R. The field economists serve as the Department's primary source of intelligence on local economic and housing conditions, providing analysis and recommendations to field and headquarters management and program officials, including reports for the Secretary's U.S. Housing Market Conditions quarterly report. They also assist HUD clients in identifying and analyzing economic and demographic data; provide market analysis reviews of various program applications, conduct needs assessments of assisted housing proposals, and advise on the allocations of assisted housing funds.

WORKLOAD

The workload of PD&R focuses on ways to improve the efficiency, effectiveness, and equity of HUD programs. This entails developing policy recommendations for the Secretary, performing policy and economic analyses, directing research and demonstration activities, and evaluating and monitoring new and existing programs for the Department. The workload also includes supporting the Secretary in carrying out his responsibilities for Fannie Mae and Freddie Mac regulation and preparing the annual reports to Congress. In carrying out its responsibilities, PD&R conducts analyses using either contract or in-house staff resources, depending on the issue and the nature of the work. PD&R also works with other HUD staff, State and local governments, academicians, representatives of various interest groups, and other interested parties, to assure that all accessible knowledge is brought to bear on issues of concern to the Department.

TRAVEL

The increase of $63 thousand included in the 2001 travel estimate will provide adequate funds for the travel requirements of PD&R including: essential travel by the Front Office and other senior staff, PATH travel, field economists travel, inspection trips to ensure that contractor performance is in line with objectives, and other staff travel.

CONTRACTS

The following table identifies the specific contracts unique to this activity and is followed by a brief description.

The increase of $1,444 thousand in the 2001 estimate will provide adequate funds for the contract needs of PD&R as described below.

Data and Statistical Services

This activity provides the Department with information for setting Fair Market Rents (FMR) and current data on the housing inventory and vacancies in selected housing market areas (both metropolitan and non-metropolitan cities) where HUD housing and community development programs are utilized. An increase of $1,444 thousand is requested to provide more frequent FMR updates for areas with large Section 8 programs and to improve the accuracy and reliability of FMRs, as well as to continue the Assisted Housing Quality Control (QC) study. The QC process involves drawing a nationally representative sample of all Public Housing and Section 8 units. On-site tenant interviews and file reviews are then conducted. These data are used to determine actual tenant incomes and their contribution to rent. The QC income and rent contribution determinations are then compared with the program sponsor figures and the results used to produce national estimates of the type, severity, and cost of errors. After these findings are communicated to HUD, the Department selects the errors of most concern and designs and implements corrective actions. A subsequent QC study then starts another cycle of error estimation and corrective actions. The HUD Annual Report describes the performance of HUD programs. Vacancy Surveys and F.W. Dodge Data provide information used by Field Economists in reviewing the marketability and risk of multifamily projects proposed for FHA insurance.