Section 184 Indian Housing Loan Guarantee Program Increase in the Loan Guarantee Fee, 12520-12521 [2014-04513]

Download as PDF 12520 Federal Register / Vol. 79, No. 43 / Wednesday, March 5, 2014 / Notices submitted to OMB a request for approval of the information collection described in Section A. The Federal Register notice that solicited public comment on the information collection for a period of 60 days was published on December 11, 2013. A. Overview of Information Collection Title of Information Collection: Restrictions on Assistance to Noncitizens. OMB Approval Number: 2501–0014. Type of Request: Extension of a currently approved collection. Form Number: HUD–9886, HUD– 9886–ARA, HUD–9886–CAM, HUD– 9886–CHI, HUD–9886–CRE, HUD– 9886–FRE, HUD–9886–HMO, HUD– 9886–KOR, HUD–9886–RUS, HUD– 9886–SPA, HUD–9886–VIE. Description of the need for the information and proposed use: HUD is prohibited from making financial Number of respondents Reporting burden New admissions ................................................................................ Recertifications ................................................................................. Annual responses 4,055 4,055 DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT B. Solicitation of Public Comment [Docket No. FR–5732–N–01] This notice is soliciting comments from members of the public and affected parties concerning the collection of information described in Section A on the following: (1) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) The accuracy of the agency’s estimate of the burden of the proposed collection of information; (3) Ways to enhance the quality, utility, and clarity of the information to be collected; and (4) Ways to minimize the burden of the collection of information on those who are to respond; including through the use of appropriate automated collection techniques or other forms of information technology, e.g., permitting electronic submission of responses. HUD encourages interested parties to submit comment in response to these questions. Section 184 Indian Housing Loan Guarantee Program Increase in the Loan Guarantee Fee Authority: Section 3507 of the Paperwork Reduction Act of 1995, 44 U.S.C. Chapters 35. Date: February 27, 2014. Colette Pollard, Department Reports Management Officer, Office of the Chief Information Officer. [FR Doc. 2014–04904 Filed 3–4–14; 8:45 am] mstockstill on DSK4VPTVN1PROD with NOTICES BILLING CODE 4210–67–P VerDate Mar<15>2010 17:13 Mar 04, 2014 Jkt 232001 Office of the Assistant Secretary for Public and Indian Housing, HUD. ACTION: Notice. AGENCY: The Section 184 Indian Housing Loan Guarantee program (Section 184 program) provides access to sources of private financing for Indian families, Indian housing authorities, and Indian tribes that otherwise could not acquire housing financing because of the unique legal status of Indian land, by guaranteeing loans to eligible persons and entities. Over the last 5 years, the Section 184 program has doubled the number of loans and eligible families being assisted by the program. For HUD to continue to meet the increasing demand for participation in this program, HUD is exercising its new authority to increase the loan guarantee fee to 1.5 percent of the principal obligation from the current rate of 1 percent. DATES: Effective Date: April 4, 2014. FOR FURTHER INFORMATION CONTACT: Rodger Boyd, Deputy Assistant Secretary for Native American Programs, Office of Public and Indian Housing, Department of Housing and Urban Development, 451 7th Street SW., Room 4126, Washington, DC 20410; telephone number 202–401–7914 (this is not a toll-free number). Persons with hearing or speech disabilities may access this number through TTY by calling the toll-free Federal Relay Service at 800–877–8339. SUPPLEMENTARY INFORMATION: PO 00000 Frm 00059 Fmt 4703 Sfmt 4703 × Hours per response 864,434 29,648 Total Estimated Burden Hours: 140,681. SUMMARY: assistance available to other than citizens or persons of eligible immigration status. This is a request for an extension of the current approval for HUD to require a declaration of citizenship or eligible immigration status from individuals seeking certain housing assistance. Respondents (i.e. affected public): Individuals or households, State, Local, or Tribal Government. 0.16 0.08 = Burden hours 138,309 2,372 I. Background Section 184 of the Housing and Community Development Act of 1992 (Pub. L. 102–550, approved October 28, 1992), as amended by the Native American Housing Assistance and SelfDetermination Act of 1996 (Pub. L. 104– 330, approved October 26, 1996), established the Section 184 program to provide access to sources of private financing to Indian families, Indian housing authorities, and Indian tribes that otherwise could not acquire housing financing because of the unique legal status of Indian land. Because title to trust or restricted land is inalienable, title cannot be conveyed to eligible Section 184 program borrowers. As a consequence, financial institutions cannot utilize the land as security in mortgage lending transactions. The Section 184 program addresses obstacles to mortgage financing on trust land and in other Indian and Alaska Native areas by giving HUD the authority to guarantee loans to eligible persons and entities to construct, acquire, refinance, or rehabilitate one-to-four family dwellings in these areas. The Section 184 Loan Guarantee Fund (the Fund) receives annual appropriations to cover the cost of the program. Guarantee fees and any other amounts, claims, notes, mortgages, contracts, and property acquired by the Secretary under the Section 184 program reduce the amount of appropriations needed to support the program, and together with appropriations are used to fulfill obligations of the Secretary with respect to the loans guaranteed under this section. In recent years, rapidly growing demand has increased the need for subsidy appropriations to support new loan guarantees. HUD issued loan guarantee commitments for $307 million in 2008, $508 million in 2009, E:\FR\FM\05MRN1.SGM 05MRN1 Federal Register / Vol. 79, No. 43 / Wednesday, March 5, 2014 / Notices mstockstill on DSK4VPTVN1PROD with NOTICES $552 million in 2010, $531 million in 2011, $797 million in 2012, and $648 million in 2013.1 Additionally, expenses have increased for acquisitions, insurance, and other program expenses, and HUD expects higher losses now that the Fund has guaranteed over $3.5 billion in current loans. Since section 184(d) of the Housing and Community Development Act of 1992 limited the guarantee fee to a maximum of 1 percent of the principal obligation, HUD’s guarantee fee has been set at 1 percent. (See 24 CFR 1005.109.) The 2013 Consolidated and Further Continuing Appropriations Act (Pub. L. 113–6, approved March 26, 2013) amended section 184(d) of the Housing and Community Development Act of 1992, by authorizing the Secretary to increase the fee for the guarantee of loans up to 3 percent of the principal obligation of the loan and to establish the amount of the fee by publishing a notice in the Federal Register. Separate from this notice and published elsewhere in today’s Federal Register, HUD updates its existing regulations to reflect the new authority. II. New Loan Guarantee Fee To meet the growing demand for participation in the Section 184 program, HUD is increasing the loan guarantee fee paid by borrowers to 1.5 percent of the principal obligation. In the absence of a loan guarantee fee increase, if the Section 184 program received appropriations of $6 million for Fiscal Year (FY) 2014, that funding would support only about $650 million in new loan guarantee commitments. Considering the increasing demand for the program, this may force HUD to limit access to the program for some otherwise eligible program participants. In addition, if HUD were to limit access to the loan guarantee program, HUD predicts that some lenders currently participating in the Section 184 program may choose to no longer partner with HUD to provide mortgage lending through the Section 184 program. Without those lenders, the Section 184 program would be unable to meet the demand for mortgage lending on trust land and in Indian and Alaska Native areas and tribal lands, potentially causing a further reduction in program activity. By raising the loan guarantee fee paid by borrowers to 1.5 percent of the principal obligation, the credit subsidy rate will go down, and HUD expects the 1 The volume in 2013 does not represent program demand because during FY 2013, the program was shut down for 8 weeks and did not guarantee refinances, which typically accounts for 30 percent of the Section 184 program’s business. VerDate Mar<15>2010 17:13 Mar 04, 2014 Jkt 232001 program will be able to guarantee the volume of loans expected in FY 2014. In addition, HUD could resume refinancing off of trust lands in FY 2014, which was temporarily halted for all of FY 2013. Raising the loan guarantee fee paid by borrowers to 1.5 percent of the principal obligation would cost the average borrower (who has a $175,000 mortgage) an extra $4 a month on the borrower’s monthly payment. Even with these additional costs to borrowers, the Section 184 program will still be affordable. While paying an increased fee may be a hardship for some borrowers, HUD does not believe that the extra cost is cost prohibitive and believes it will have a limited impact on the demand for the program. However, the increased fee will allow HUD to continue to meet the demand for new mortgage lending transactions so that more Indian and Alaska Native families have the opportunity for homeownership.2 This notice places the new loan guarantee fee of 1.5 percent of the principal obligation of the loan in effect for all new case numbers assigned on or after April 4, 2014. III. Tribal Consultation HUD’s policy is to consult with Indian tribes early in the process on matters that have tribal implications. Accordingly, on September 6, 2013, HUD sent letters to all tribal leaders participating in the Section 184 program, informing them of the nature of the forthcoming notice and soliciting comments. A summary of comments received and responses can be found on HUD’s Web site at http://portal.hud.gov/ hudportal/HUD?src=/program_offices/ public_indian_housing/ih/ homeownership/184. IV. Environmental Impact This notice involves the establishment of a rate or cost determination that does not constitute a development decision affecting the physical condition of specific project areas or building sites. Accordingly, under 24 CFR 50.19(c)(6), this notice is categorically excluded from environmental review under the National Environmental Policy Act of 1969 (U.S.C. 4321). 12521 Dated: February 21, 2014. Sandra B. Henriquez, Assistant Secretary for Public and Indian Housing. [FR Doc. 2014–04513 Filed 3–4–14; 8:45 am] BILLING CODE 4210–67–P DEPARTMENT OF THE INTERIOR [MMAA104000] Outer Continental Shelf (OCS) Scientific Committee—Notice of Renewal Bureau of Ocean Energy Management (BOEM), Interior. AGENCY: ACTION: Notice of Renewal. Following consultation with the General Services Administration, notice is hereby given that the Secretary of the Interior is renewing the OCS Scientific Committee. The OCS Scientific Committee provides advice on the feasibility, appropriateness, and scientific value of the OCS Environmental Studies Program to the Secretary of the Interior through the Director of the Bureau of Ocean Energy Management. The Committee reviews the relevance of the research and data being produced to meet BOEM’s scientific information needs for decision making and may recommend changes in scope, direction, and emphasis. SUMMARY: Ms. Phyllis Clark, Bureau of Ocean Energy Management, Office of Environmental Program, Environmental Sciences Division, Herndon, Virginia 20170– 4817, telephone, (703) 787–1716. FOR FURTHER INFORMATION CONTACT: Certification I hereby certify that the renewal of the OCS Scientific Committee is in the public interest in connection with the performance of duties imposed on the Department of the Interior by 43 U.S.C. 1331 et. seq. Dated: February 25, 2014. Sally Jewell, Secretary of the Interior. [FR Doc. 2014–04883 Filed 3–4–14; 8:45 am] 2 In its Congressional Justifications for HUD’s FY 2014 budget, HUD announced that it would pursue a fee increase to 1.5 percent in the Section 184 program. Please see page M–5 of HUD’s Congressional Justification for the ‘‘Indian Housing Loan Guarantee Fund (Section 184)’’ at http:// portal.hud.gov/hudportal/HUD?src=/program_ offices/cfo/reports/2014/main_toc. PO 00000 Frm 00060 Fmt 4703 Sfmt 9990 BILLING CODE 4310–MR–P E:\FR\FM\05MRN1.SGM 05MRN1

Agencies

[Federal Register Volume 79, Number 43 (Wednesday, March 5, 2014)]
[Notices]
[Pages 12520-12521]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-04513]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5732-N-01]


Section 184 Indian Housing Loan Guarantee Program Increase in the 
Loan Guarantee Fee

AGENCY: Office of the Assistant Secretary for Public and Indian 
Housing, HUD.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The Section 184 Indian Housing Loan Guarantee program (Section 
184 program) provides access to sources of private financing for Indian 
families, Indian housing authorities, and Indian tribes that otherwise 
could not acquire housing financing because of the unique legal status 
of Indian land, by guaranteeing loans to eligible persons and entities. 
Over the last 5 years, the Section 184 program has doubled the number 
of loans and eligible families being assisted by the program. For HUD 
to continue to meet the increasing demand for participation in this 
program, HUD is exercising its new authority to increase the loan 
guarantee fee to 1.5 percent of the principal obligation from the 
current rate of 1 percent.

DATES: Effective Date: April 4, 2014.

FOR FURTHER INFORMATION CONTACT: Rodger Boyd, Deputy Assistant 
Secretary for Native American Programs, Office of Public and Indian 
Housing, Department of Housing and Urban Development, 451 7th Street 
SW., Room 4126, Washington, DC 20410; telephone number 202-401-7914 
(this is not a toll-free number). Persons with hearing or speech 
disabilities may access this number through TTY by calling the toll-
free Federal Relay Service at 800-877-8339.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 184 of the Housing and Community Development Act of 1992 
(Pub. L. 102-550, approved October 28, 1992), as amended by the Native 
American Housing Assistance and Self-Determination Act of 1996 (Pub. L. 
104-330, approved October 26, 1996), established the Section 184 
program to provide access to sources of private financing to Indian 
families, Indian housing authorities, and Indian tribes that otherwise 
could not acquire housing financing because of the unique legal status 
of Indian land. Because title to trust or restricted land is 
inalienable, title cannot be conveyed to eligible Section 184 program 
borrowers. As a consequence, financial institutions cannot utilize the 
land as security in mortgage lending transactions. The Section 184 
program addresses obstacles to mortgage financing on trust land and in 
other Indian and Alaska Native areas by giving HUD the authority to 
guarantee loans to eligible persons and entities to construct, acquire, 
refinance, or rehabilitate one-to-four family dwellings in these areas.
    The Section 184 Loan Guarantee Fund (the Fund) receives annual 
appropriations to cover the cost of the program. Guarantee fees and any 
other amounts, claims, notes, mortgages, contracts, and property 
acquired by the Secretary under the Section 184 program reduce the 
amount of appropriations needed to support the program, and together 
with appropriations are used to fulfill obligations of the Secretary 
with respect to the loans guaranteed under this section.
    In recent years, rapidly growing demand has increased the need for 
subsidy appropriations to support new loan guarantees. HUD issued loan 
guarantee commitments for $307 million in 2008, $508 million in 2009,

[[Page 12521]]

$552 million in 2010, $531 million in 2011, $797 million in 2012, and 
$648 million in 2013.\1\ Additionally, expenses have increased for 
acquisitions, insurance, and other program expenses, and HUD expects 
higher losses now that the Fund has guaranteed over $3.5 billion in 
current loans. Since section 184(d) of the Housing and Community 
Development Act of 1992 limited the guarantee fee to a maximum of 1 
percent of the principal obligation, HUD's guarantee fee has been set 
at 1 percent. (See 24 CFR 1005.109.) The 2013 Consolidated and Further 
Continuing Appropriations Act (Pub. L. 113-6, approved March 26, 2013) 
amended section 184(d) of the Housing and Community Development Act of 
1992, by authorizing the Secretary to increase the fee for the 
guarantee of loans up to 3 percent of the principal obligation of the 
loan and to establish the amount of the fee by publishing a notice in 
the Federal Register. Separate from this notice and published elsewhere 
in today's Federal Register, HUD updates its existing regulations to 
reflect the new authority.
---------------------------------------------------------------------------

    \1\ The volume in 2013 does not represent program demand because 
during FY 2013, the program was shut down for 8 weeks and did not 
guarantee refinances, which typically accounts for 30 percent of the 
Section 184 program's business.
---------------------------------------------------------------------------

II. New Loan Guarantee Fee

    To meet the growing demand for participation in the Section 184 
program, HUD is increasing the loan guarantee fee paid by borrowers to 
1.5 percent of the principal obligation. In the absence of a loan 
guarantee fee increase, if the Section 184 program received 
appropriations of $6 million for Fiscal Year (FY) 2014, that funding 
would support only about $650 million in new loan guarantee 
commitments. Considering the increasing demand for the program, this 
may force HUD to limit access to the program for some otherwise 
eligible program participants. In addition, if HUD were to limit access 
to the loan guarantee program, HUD predicts that some lenders currently 
participating in the Section 184 program may choose to no longer 
partner with HUD to provide mortgage lending through the Section 184 
program. Without those lenders, the Section 184 program would be unable 
to meet the demand for mortgage lending on trust land and in Indian and 
Alaska Native areas and tribal lands, potentially causing a further 
reduction in program activity.
    By raising the loan guarantee fee paid by borrowers to 1.5 percent 
of the principal obligation, the credit subsidy rate will go down, and 
HUD expects the program will be able to guarantee the volume of loans 
expected in FY 2014. In addition, HUD could resume refinancing off of 
trust lands in FY 2014, which was temporarily halted for all of FY 
2013. Raising the loan guarantee fee paid by borrowers to 1.5 percent 
of the principal obligation would cost the average borrower (who has a 
$175,000 mortgage) an extra $4 a month on the borrower's monthly 
payment. Even with these additional costs to borrowers, the Section 184 
program will still be affordable. While paying an increased fee may be 
a hardship for some borrowers, HUD does not believe that the extra cost 
is cost prohibitive and believes it will have a limited impact on the 
demand for the program. However, the increased fee will allow HUD to 
continue to meet the demand for new mortgage lending transactions so 
that more Indian and Alaska Native families have the opportunity for 
homeownership.\2\
---------------------------------------------------------------------------

    \2\ In its Congressional Justifications for HUD's FY 2014 
budget, HUD announced that it would pursue a fee increase to 1.5 
percent in the Section 184 program. Please see page M-5 of HUD's 
Congressional Justification for the ``Indian Housing Loan Guarantee 
Fund (Section 184)'' at http://portal.hud.gov/hudportal/HUD?src=/program_offices/cfo/reports/2014/main_toc.
---------------------------------------------------------------------------

    This notice places the new loan guarantee fee of 1.5 percent of the 
principal obligation of the loan in effect for all new case numbers 
assigned on or after April 4, 2014.

III. Tribal Consultation

    HUD's policy is to consult with Indian tribes early in the process 
on matters that have tribal implications. Accordingly, on September 6, 
2013, HUD sent letters to all tribal leaders participating in the 
Section 184 program, informing them of the nature of the forthcoming 
notice and soliciting comments. A summary of comments received and 
responses can be found on HUD's Web site at http://portal.hud.gov/hudportal/HUD?src=/program_offices/public_indian_housing/ih/homeownership/184.

IV. Environmental Impact

    This notice involves the establishment of a rate or cost 
determination that does not constitute a development decision affecting 
the physical condition of specific project areas or building sites. 
Accordingly, under 24 CFR 50.19(c)(6), this notice is categorically 
excluded from environmental review under the National Environmental 
Policy Act of 1969 (U.S.C. 4321).

    Dated: February 21, 2014.
Sandra B. Henriquez,
Assistant Secretary for Public and Indian Housing.
[FR Doc. 2014-04513 Filed 3-4-14; 8:45 am]
BILLING CODE 4210-67-P