HUD HCV Guidebook § 3.5.4

Under no circumstances can the PHA establish an exception payment standard only for a specific PBV project.
Exception payment standards must apply to a specific geographic area.60
For PBV projects that are located in a mandatory SAFMR area or are located in a ZIP Code where the PHA has
opted in to the SAFMR, any exception payment standard amount approved under 24 CFR 982.503(d)(3)-(4)
will apply to the PHA’s determination61 for the PBV project only if the PHA has adopted a policy applying
SAFMRs to its PBV program and met all other requirements in accordance with 24 CFR 888.113(h).62 If the
PHA has not applied the SAFMRs to its PBV program and met all other requirements in accordance with 24
CFR 888.113(h), 110 percent of the metropolitan area or non-metropolitan county FMR minus the utility

59
   For FY 2025, the rental inflation adjustment factors can be found here under the “data” tab for the applicable
year: https://www.huduser.gov/portal/datasets/fmr.html
60
   24 CFR 982.503(d)(1)
61
   24 CFR 983.301(b)(1) and 24 CFR 983.301(c)(1)(iv)
62
   24 CFR 983.301(f)(3)(ii)

allowance remains the applicable limit on the amount determined by the PHA when calculating rent to owner
for the project,63 regardless of whether any exception payment standard is in effect under 24 CFR
982.503(d)(3)-(4). In either case, the rent must also meet the rent reasonableness and other requirements.64
For PBV projects that are not located in a mandatory SAFMR area or are not located in a ZIP Code where the
PHA has opted in to the SAFMR, any exception payment standard amount approved under 24 CFR
982.503(d)(2)-(4) applies for purposes of establishing the maximum rent for the PBV project or determining if
the project qualifies for a different maximum rent for certain tax credit projects.65 The amount of rent to
owner determined by the PHA may not exceed the exception payment standard minus utility allowance, rather
than the normally applicable 110 percent of FMR minus utility allowance limitation,66 and the rent
reasonableness requirements continue to apply. However, certain tax credit projects that meet the criteria of
24 CFR 983.301(c)(1) may set the rent to owner above the exception payment standard (not to exceed the tax
credit rent minus any utility allowance) if the tax credit rent exceeds the exception payment standard.67