STOP LOSS     *See stop loss tab for the referenced materials      For the 2007 operating fund (subsidy), your housing authority will be receiving funds based on the new WAPEL.  If your housing authority is going to have a reduction in the funding amount, you are eligible to "stop the loss" of the reduction.   What does this mean?  If you decide to submit the stop loss kit*, and can meet all of the criteria outlined on page 6 and 7 of PIH 2006-14* you will be able to control the reduction of your operating fund to a decrease of only 5% instead of the total loss amount.   The stop loss kit* was issued July 12, 2006 which includes a concession for small PHAs. Housing authorities with less than 250 units are not required to establish a separate Central Office Cost Center.  This is attractive to small housing authorities since the accounting will continue as currently done.  Please refer to page 10 of the stop loss kit* for the per unit month range your administrative costs cannot exceed.  What are administrative costs?  The best way to explain administrative costs, is to refer to your current operating budget form 52564 line 210, total administrative expense column 4, plus any admin employee benefits and bad debts.   EXAMPLE Smalltown Housing Authority, Nebraska   Administrative expense                            77.22 PUM Administrative benefits                              4.64  PUM Bad debts                                                          .71 PUM Total admin expense is                             82.57 PUM   The stop loss threshold for the State of Nebraska is $122.49 PUM.  Since the housing authority's administrative expenses do not exceed the threshold range, the housing authority is a "fit" for not needing to establish a separate cost center.   If the administrative expenses exceed the threshold, you may want to review the services the administrative staff performs.  For example, at a small housing authority the executive director may also perform maintenance duties but never separated the executive director's salary between administration and maintenance.  This may be necessary in order to not exceed the administrative cost range.  Another idea to reduce the administrative expense may be to charge the Capital Fund with training and travel expenses.   For large housing authorities, 250 or more units, the Central Office Cost Center (COCC) is a requirement.   Our office sent an email to our clients that are decliners offering to assist with the stop loss application kit*.  Because each situation is different, please contact our office for the fee to prepare the stop loss kit*.  If you informed us you would like our assistance in the preparation, we will be forwarding a worksheet to you requesting the information necessary to complete the kit.  Some of the items we will be requesting are:   1.     Are the properties family or elderly? 2.     Is it a scattered site? 3.     Year the housing authority construction was completed. 4.     Recently renovated 5.  Occupancy 5.     Staff position and job description 6.     Waiting list 7.     Move in information 8.     Work order information 9.     Customer traffic   We are unsure at this time which month will be used for tracking the customer traffic, so I suggest immediately starting to maintain a log for inquires about the housing authority by 1) how many walked in or 2) how many telephoned.  We will also need to know the amount of applications received at the housing authority.   All this information seems like a lot to do, but currently you track most of these items for your MASS Submission. And it is a one-time submission.     WOW, this is hard to understand, comprehend, decide and understand (oh, I already said that), so call our office 402-362-4481 and we will be happy to discuss this procedure with you.     Previous Articles:  July 2004 Hard Cost vs. Soft Cost December 2004 Capital Fund Operations Budget Line 1406 Aug 2006 Stop Loss Newsletter