For use with HCV, Project-Based Section 8, and LIHTC Programs

To keep assisted housing affordable for lower-income households, federal housing law directs that the resident's share of rent in federally assisted public housing should equal 30 percent of the household's adjusted monthly income. In interpreting the federal housing law, HUD has defined the Total Resident Payment for "rent" to include both shelter and the costs for reasonable amounts of utilities. The amount determined necessary to cover the resident's reasonable utility costs is the utility allowance.

Utility allowances are calculated for all counties in which the HCV Program is administered by THDA. As required by HUD, THDA reviews the allowances on an annual basis to determine if any adjustment (upward or downward) needs to be made. This analysis is based on HUD approved methodology. THDA creates allowances for each bedroom size for the following unit types: Detached houses, Duplexes/townhomes, Apartments, and Manufactured homes.

At the time a Request for Tenancy Approval is signed, and at every subsequent recertification, a determination of utilities and/or services paid by the tenant is made. These obligations are shown on the Utility Allowance Schedule according to the county, the unit type (house, duplex/townhouse, apartment or mobile home), and the unit size. The unit size is determined by counting the bedrooms (regardless of how the bedroom is utilized, such as a sewing room or study). Please keep in mind that to be counted as a bedroom, the room must meet all the Housing Quality Standards requirements for a bedroom (presence of a window, door for privacy, smoke detector located outside of the room, etc.). Rooms used for sleeping purposes (such as the living room or den) are not to be included in determining unit size. The total utility obligation of the tenant equals the Utility Allowance.

If the Utility Allowance is greater than the tenant's Total Tenant Payment, a Utility Reimbursement is sent to the tenant. The reimbursement equals the amount that the Utility Allowance exceeds the TTP. If the TTP is greater than the Utility Allowance, the tenant pays a portion of the rent to the landlord. This payment equals the amount that the TTP exceeds the Utility Allowance.

The Utility Allowance is added to the Contract Rent to determine the Gross Rent for the unit.

Utility Allowance by County - 2023

2023 Utility Allowance Methodology

Instructions for 2023 Utility Allowances updated

Utility Reimbursement Payments

When the Utility Allowance exceeds the Total Tenant Payment of the family, THDA will provide a Utility Reimbursement Payment to the family each month. The utility reimbursement will be paid directly to the tenant.