What Is Annual Contributions Contract
An Annual Contributions Contract (ACC) is a legally binding agreement between the U.S. Department of Housing and Urban Development (HUD) and a Public Housing Authority (PHA) that specifies the federal funding available to operate the Housing Choice Voucher program for a given fiscal year. The ACC establishes the maximum number of vouchers a PHA can administer and the dollar amount HUD will contribute to cover program costs.
How It Works
HUD allocates funding to each PHA through the ACC based on factors including the number of vouchers in use, fair market rent levels, and administrative costs. The PHA receives this annual appropriation and uses it to cover housing assistance payments (HAP) to landlords, program administration, inspections, and compliance activities. The ACC is renegotiated annually, typically between August and October, for the following fiscal year beginning October 1st.
For landlords, the ACC indirectly affects your participation. If a PHA's ACC funding is reduced, the agency may issue fewer new vouchers, impose a waitlist freeze, or reduce the number of active vouchers. For tenants holding vouchers, the ACC ensures consistent subsidy payments to your landlord, provided you maintain Housing Quality Standards (HQS) compliance and your PHA conducts required inspections under NSPIRE protocols.
The ACC also mandates that PHAs spend at least 75 percent of their administrative fees on activities directly supporting the voucher program, including inspections, eligibility determinations, and compliance monitoring.
Key Details
- Funding mechanism: The ACC is HUD's tool for distributing approximately $29 billion annually across nearly 2,300 PHAs nationwide to support roughly 2.3 million Housing Choice Vouchers.
- Mandatory inspections: ACC funding includes requirements for initial HQS inspections and annual or biennial NSPIRE inspections depending on the property's track record.
- Portability: The ACC framework allows tenants to use vouchers across PHA jurisdictions under portability agreements, though the receiving PHA's ACC must have capacity.
- Rent limits: The ACC references Fair Market Rent (FMR) levels that determine the maximum monthly subsidy a PHA will provide, varying by bedroom size and zip code.
- Flexibility clause: PHAs may request ACC amendments mid-year if circumstances change, such as unexpected increases in Fair Market Rent or significant voucher turnover.
Common Questions
- Will my voucher subsidy change if the PHA's ACC is reduced? A reduced ACC typically does not affect current vouchers already in use, but the PHA may stop issuing new vouchers or reduce subsidies for lease renewals if rent increases exceed FMR. Contact your PHA directly if you receive a non-renewal notice.
- How does the ACC relate to NSPIRE inspections? The ACC includes dedicated funding for inspections. PHAs must conduct initial HQS inspections before issuing vouchers and follow NSPIRE inspection schedules (annual for properties with health or safety violations, biennial for compliant properties). Landlords should expect inspections aligned with these ACC-funded requirements.
- Can a PHA deny my voucher application because their ACC is at capacity? Yes. If a PHA's ACC-funded voucher allocation is fully utilized, they typically maintain a waitlist rather than issue additional vouchers until funding increases or existing vouchers terminate.