HUD Changes to Procurement Handbook Could Significantly Impact PHAs
By: Eric Oberdorfer, Director of Policy & Legislative Affairs
March 30, 2026 — HUD recently notified Executive Directors that it published its updated Public Housing Agency (PHA) Procurement Handbook (7460.8 REV-3), marking the first comprehensive revision since 2007. While some elements of the new handbook reflect an effort to align PHA procurement practices with broader federal standards, several of the policy changes raise significant concerns for housing agencies and could have far-reaching operational impacts.
The updated handbook brings procurement thresholds in line with federal guidance under 2 CFR Part 200, including setting the Simplified Acquisition Threshold at $350,000 and aligning the Micro-Purchase Threshold with the Federal Acquisition Regulation. It also clarifies that Operating Fund and Capital Fund assistance are subject to federal procurement requirements, and reinforces expectations around documentation, record retention, and internal controls. These changes, while important for consistency, are largely expected.
More concerning, however, are the shifts in how HUD appears to be applying procurement requirements to funding sources that have historically been treated with greater flexibility. Most notably, the handbook applies federal procurement requirements to income generated by the Central Office Cost Center (COCC), including fee-based revenue. This represents a clear departure from the principles of asset management established in the 2005 asset-based management rulemaking, which intentionally allowed PHAs more discretion in how they manage and deploy these funds. By subjecting COCC-generated income to federal procurement rules, HUD risks undermining a core component of the asset management framework that agencies have relied on for nearly two decades.
Similarly, the handbook newly applies federal procurement requirements to Housing Choice Voucher (HCV) administrative fees. These funds were previously exempt under 24 CFR Part 85, and PHAs have structured their programs and operations accordingly. According to the Handbook, this exemption was only available through December 26, 2014, when 2 Part 200 went into effect. The previous version of the handbook did not reflect this change. HUD should provide clear transition guidance to avoid confusion, increased administrative burden, and to prevent any disruptions to existing contracts and business practices.
NAHRO will continue to look into these changes and discuss the impact to PHAs with the Department and other groups.