For decades, the Bureau of Labor Statistics tracked what households paid for electricity and natural gas city by city, feeding that local detail into how the government calculates rent ceilings for housing vouchers nationwide. Then the agency stopped. Starting with data published in February 2025, BLS discontinued the local and regional versions of that index, and the Department of Housing and Urban Development has spent the time since building a replacement from scratch. The fix shows up for the first time in the fiscal year 2027 Fair Market Rents taking effect October 1.
The Government Data Series That Went Away
The change traces back to a routine-sounding BLS announcement. In its notice on Consumer Price Index publication changes, BLS said that starting with the release of January 2025 data, it would discontinue five metro-area and regional indexes: electricity, utility piped gas, energy services, fuels and utilities, and household energy. Those series would continue to exist at the national level only. For most CPI watchers, it was a minor footnote. For HUD, it eliminated a data feed the agency had relied on for years to estimate how utility costs were moving in a specific city or region rather than the country as a whole.
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Why Utilities Even Count Toward a Voucher’s Rent Ceiling
A Fair Market Rent is not just shelter cost. HUD’s own regulation defines it as an estimate of rent “plus the cost of utilities, except telephone,” meaning every FMR already bakes in a projection of what a tenant would spend heating, cooling, and powering a unit, not just what a landlord charges for the space itself. That utility piece has always needed its own inflation estimate, separate from the rent-only data HUD pulls from the Census Bureau, which is exactly the estimate the discontinued local CPI used to supply.
Building a New Utility Number From Four Pieces
In place of the retired CPI series, HUD now builds its own composite from four separate fuel and utility components: electricity, natural gas, fuel oil, and water, sewer, and trash collection. Electricity, natural gas, and fuel oil prices come from state-level U.S. Energy Information Administration survey data; water, sewer, and trash cost changes come from a national BLS series, since no local substitute exists for those. HUD assigns each of the roughly two dozen self-representing metro areas used in the old CPI sample, plus four broader Census regions covering everywhere else, a population-weighted blend of the relevant state-level prices, then tracks the year-over-year change in each of the four components before combining them using national weights for how much a typical household actually spends on each one.
Some of those areas cross state lines, which makes the population-weighting step more than a formality. The Washington-Arlington-Alexandria area, for example, spans the District of Columbia, Virginia, Maryland, and West Virginia across 25 counties, so HUD builds that single area’s utility price for each of the four components as a population-weighted average across every jurisdiction inside it, rather than picking one state’s numbers and applying them to the whole region. The same four-part composite now reaches further than last year’s rent estimate. Starting with the FY2027 figures, HUD’s longer-range trend-factor models, the ones used to project each area’s rent forward to the year the FMR actually applies, incorporate the new utility composite for the first time, so the retired local CPI’s replacement now touches two separate stages of the math instead of one.
What Doesn’t Change Because of the Switch
The utility swap touches only one input inside a much larger calculation. HUD still starts every FMR with five years of Census Bureau rent data, still adds a separate shelter-only inflation factor built from private rent trackers and Consumer Price Index rent data, and still trends the combined estimate forward using the same regional forecasting models it has used since 2020. The utility composite feeds into that gross-rent inflation figure and into HUD’s multi-year trend forecasts, but it does not touch how HUD measures base rents, how it adjusts for bedroom count, or the separate rule limiting how far any single area’s FMR can fall from one year to the next. On the shelter side, HUD still blends a private-data rent measure and a Consumer Price Index rent measure at roughly 55 percent and 45 percent, respectively, exactly as it did before the utility methodology changed; the FY2027 notice is explicit that the utility fix is the only structural change in this year’s calculation.
The Federal Register Paper Trail Behind the Swap
HUD did not spring this change on the public with the FY2027 notice. The agency first disclosed the coming switch more than a year earlier, in the notice announcing the fiscal year 2026 Fair Market Rents, which flagged it as a proposed material change tied directly to BLS’s decision to drop the local index. The FY2027 notice is where HUD confirms the new methodology is actually in use, not merely proposed, for every FMR area in the country starting October 1, 2026, closing the loop on a data problem that began at BLS, not at HUD.
This article was produced with AI assistance and reviewed by a human editor. Figures are linked to their primary sources; where a claim could not be verified from the public record, we say so.
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