MTW Flexibility Reserves Status

As discussed in Section 5(a) of the MTW Operations Notice, the designation of a public housing authority (PHA) as an MTW Agency provides the agency with the ability to apply funding fungibility among the traditional PHA funding sources (Public Housing Capital and Operating Funds, Housing Choice Voucher (HCV) Housing Assistance Payment (HAP), and HCV Administrative Fee assistance). Because the 2016 Expansion Statute does not expressly authorize accumulated reserves to be used in accordance with this fungibility, any previously appropriated prior year funds (i.e., reserves) provided to the PHA prior to the date of its executed MTW Annual Contribution Contract (ACC) Amendment must be used for their originally appropriated purposes and cannot be used flexibly.

However, Congress granted MTW Expansion Agencies temporary relief from this requirement in the Fiscal Year (FY) 2022 Appropriations Act, which permitted an MTW Expansion Agency to use its prior year funds flexibly for any MTW-eligible purpose during FY 2022. Congress again provided this funding flexibility in the Consolidated Appropriations Act, 2023 (Public Law 117-328), which was signed into law by the President on December 29, 2022. Consequently, MTW Expansion PHA(s) may utilize funding flexibility for prior-year reserves through September 30, 2023.  MTW Expansion Agencies should understand that this flexibility may not continue in future years and should carefully monitor future appropriations acts to see if this flexibility is provided in subsequent years. MTW Agencies are responsible for being aware of each year’s appropriations act and for maintaining accurate recordkeeping to demonstrate compliance with this requirement.

Federal Appropriations Acts

FY 2023 Appropriations Continuing Resolution can be found on the website.

Since the reserves’ flexibility is subject to continued action by Congress, HUD will inform MTW Agencies of the status of this flexibility after September 30, 2023, by publishing the status of this flexibility on this webpage.  If an MTW Expansion Agency has any questions about this message, please email for further assistance.


Last updated January 18, 2023