Housing Counseling Process Evaluation and Design of ... - HUD User

A few organizations require agencies to complete a lengthy application that is evaluated against a set
of formal criteria, including mission, length of experience, staff qualifications, past performance, and
population(s) served. These organizations may also conduct conference calls and site visits to
supplement and verify the information provided in the application. One intermediary described a
two-tiered approach, in which applicants for HUD counseling funds initially submit a very short
application, which the intermediary uses to screen out unqualified applicants, and then a longer
application that is used to rank and rate the applicants and determine funding allocations. This level
of involvement, however, is somewhat exceptional.
Most of the intermediaries and SHFAs interviewed try to keep the application as streamlined as
possible and make funding allocations based on a flexible set of criteria, including location,
population(s) served, agency capacity, staff qualifications, and the type of services offered. The
weight given to the different criteria may be different for different regions and may change from year
to year. For example, one SHFA reviews each application against a set of general criteria that include
agency capacity, training and certification of counselors, and services offered, but ultimately funds
agencies based on the specific needs of different local communities in the state. Another SHFA
allocates funds primarily based on applicants’ ability to serve certain target populations (tribal lands,
persons with disabilities, and rural), but also tries to fund a mix of more and less experienced agencies
to encourage more agencies to offer housing counseling. The more experienced agencies act as
mentors to the less experienced agencies and are also able to step in if the less experienced agencies
are unable to spend their grants.
Some intermediaries and SHFAs either do not use an RFP process or essentially fund any agency that
applies. These organizations rely on their staff, branch offices, or partners to identify potential
counseling providers and work with these agencies to prepare the information needed for the HUD
application. As one SHFA put it, “we are familiar with the reputations of agencies across [the state]
and proactively seek out agencies to provide the services we think are needed.” Another approach is
to send out letters notifying all affiliates of the availability of funding and fund everybody that
responds. One of the intermediaries interviewed uses this method because it receives enough funding
to fund all applicants at a reasonable level. Another organization that funds all applicants does so
because it has a very rigorous initial affiliation process and is confident that every affiliated
organization that applies for counseling funds has the capacity to provide the services effectively.
How Intermediaries and SHFAs Monitor the Performance of Affiliates
Once funding allocations are made, most intermediaries and SHFAs monitor the performance of their
affiliates to some extent. However, as might be expected, there is substantial variation in the methods
used to monitor performance and the intensity of the monitoring.
The most common methods of monitoring affiliates for HUD-funded intermediaries and SHFAs are
conducting periodic site visits and reviewing activity reports. About half the intermediaries and
SHFAs interviewed reported conducting regular site visits to monitor performance. Some
organizations have the resources to visit every affiliate every year, but it is more common for
intermediaries and SHFAs to visit a subset of affiliates—often those suspected of having performance
issues. In addition, some site visits include direct assessment of the quality of services delivered (e.g.,
through observation of a counseling session) while others focus more on contract compliance. One
SHFA reported hiring third party evaluators to audit its homebuyer education classes.
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Chapter 4. Intermediaries and State Housing Finance Agencies