HUD Term Limits and Work Requirements Proposed Rule Published

Comments Due May 1, 2026

March 3, 2026 — Yesterday, HUD published a proposed rule titled “Establishing Flexibility for Implementation of Work Requirements and Term Limits” in the Federal Register. The proposed rule would provide agencies the flexibility to implement term limits, work requirements, both, or neither. The rule establishes guardrails that agencies choosing to implement work requirements or term limits must follow, while still allowing agencies and owners the flexibility to adopt alternative standards within those boundaries. In short, the rule would allow PHAs and PBRA owners to implement a work requirement of up to 40 hours per week per individual and a term limit for assisted households not shorter than two years.

The rule would apply to the public housing, Housing Choice Voucher (HCV), Project-Based Voucher (PBV), and Project-Based Rental Assistance (PBRA) programs. It also proposes definitions and specifies policy decisions PHAs must make if an agency chooses to implement work requirements or term limits. Only PHAs and PBRA owners and agents (O/As) in good standing would be allowed to implement work requirements. For both work requirements and term limits, PHAs and owners would be responsible for creating policies that fall within the guardrails set forth in the proposed rule and they would also be responsible for tracking and enforcing those policies.

Work Requirements 

This rule would incorporate significant flexibilities for PHAs and O/As.

• Generally, this section would apply to “work-eligible adults” no younger than the age of 18 and no older than the age of 61. The rule proposes other exemptions, including students, those caring for a family member, and other situations. PHAs would have the option to “determine the appropriate length of time for student enrollment.”
• PHAs and owners would have the ability to create requirements for various programs and different projects within the same program. Importantly, all residents in the same public housing development or project must have the rule applied to them equally. Similarly, specific special purpose vouchers must also have the rule applied equally. The HUD-VASH program is exempted from this rule, and agencies could exempt other special purpose vouchers as well.
• Policies would not be allowed to require an individual member of a household to work more than 40 hours per week.
• PHAs and owners would also need to stipulate whether the requirement would apply to the family—where a family must work a certain number of hours—or each individual subject to the rule, though no individual would be required to work more than 40 hours per week.
• In order to implement work requirements, PHAs and O/As must offer supportive services to help residents engage in work activities. This could include partnering with other organizations to provide these services. Housing Choice Voucher Administrative Fees cannot be used to fund supportive services, nor can PBRA project funds.
• PHAs and O/As may create specific language regarding what counts as a work activity and how they would handle specific circumstances arising from self-employment.
• Those opting to implement work requirements would need to add these policies to their plans (and public housing leases, if applicable). They would also need to notify tenants, implement a hardship waiver policy and offer supportive services in response to local needs.
• PHAs and O/As would be responsible for tracking, enforcing, and documenting resident compliance with their new policies.  

Term Limits 

The term limit option described in this rule would be prospective, meaning the term limit would begin for current residents only when the policy goes into effect. Any time a family previously spent receiving assistance would not count toward the term limit once the policy is implemented. As with work requirements, this section of the rule would incorporate significant flexibilities for PHAs and PBRA owners.

• Generally, this section applies to “non-elderly, non-disabled families.” The rule specifically notes that owners and agents can apply term limits “within and between” the different programs, so requirements could vary between projects and programs as well.
• PHAs could not set a term limit shorter than two years but would have the ability to implement a limit longer than two years.
• In order to implement term limits, PHAs and O/As must offer supportive services to help residents engage in work activities. HUD notes in the Work Requirements section that Housing Choice Voucher Administrative Fees and PBRA project funds cannot be used to fund supportive services. In preparing residents for term limits, “HUD encourages PHAs and Owners to assess the needs of the non-elderly, non-disabled families to determine the types of support necessary to help families prepare for transitioning from assistance.” The rule would not provide additional funding to meet these requirements.
• PHAs would need to add these policies to their plans (and public housing leases, if applicable), implement a hardship waiver policy, and offer supportive services in response to local needs.
• The policies and tenant notifications would need to state how the PHA or owner would enforce term limits. Tenants would need to be notified in writing three months before policies are implemented, 12 months before a family hits a term limit, six months before the term limit, and 30 days before the term limit.
• HUD proposes exempting HUD-VASH, FUP, and FYI, and agencies could exempt other special purpose vouchers as well.
• Moving to Work (MTW) agencies would be unaffected by the rule. 

Find the proposed rule here.