Notice of Regulatory Waiver Requests Granted for the First Quarter of Calendar Year 2019, 31329-31335 [2019-14012]

Agencies

• DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Federal Register Volume 84, Number 126 (Monday, July 1, 2019)]
[Notices]
[Pages 31329-31335]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-14012]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-6164-N-01]


Notice of Regulatory Waiver Requests Granted for the First 
Quarter of Calendar Year 2019

AGENCY: Office of the General Counsel, HUD.

ACTION: Notice.

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SUMMARY: Section 106 of the Department of Housing and Urban Development 
Reform Act of 1989 (the HUD Reform Act) requires HUD to publish 
quarterly Federal Register notices of all regulatory waivers that HUD 
has approved. Each notice covers the quarterly period since the 
previous Federal Register notice. The purpose of this notice is to 
comply with the requirements of section 106 of the HUD Reform Act. This 
notice contains a list of regulatory waivers granted by HUD during the 
period beginning on January 1, 2019 and ending on March 31, 2019.

FOR FURTHER INFORMATION CONTACT: For general information about this 
notice, contact Aaron Santa Anna, Assistant General Counsel for 
Regulations, Department of Housing and Urban Development, 451 Seventh 
Street SW, Room 10276, Washington, DC 20410-0500, telephone 202-708-
3055 (this is not a toll-free number). Persons with hearing- or speech-
impairments may access this number through TTY by calling the toll-free 
Federal Relay Service at 800-877-8339.
    For information concerning a particular waiver that was granted and 
for which public notice is provided in this document, contact the 
person whose name and address follow the description of the waiver 
granted in the accompanying list of waivers that have been granted in 
the first quarter of calendar year 2019.

SUPPLEMENTARY INFORMATION: Section 106 of the HUD Reform Act added a 
new section 7(q) to the Department of Housing and Urban Development Act 
(42 U.S.C. 3535(q)), which provides that:
    1. Any waiver of a regulation must be in writing and must specify 
the grounds for approving the waiver;
    2. Authority to approve a waiver of a regulation may be delegated 
by the Secretary only to an individual of Assistant Secretary or 
equivalent rank, and the person to whom authority to waive is delegated 
must also have authority to issue the particular regulation to be 
waived;
    3. Not less than quarterly, the Secretary must notify the public of 
all waivers of regulations that HUD has approved, by publishing a 
notice in the Federal Register. These notices (each covering the period 
since the most recent previous notification) shall:
    a. Identify the project, activity, or undertaking involved;
    b. Describe the nature of the provision waived and the designation 
of the provision;
    c. Indicate the name and title of the person who granted the waiver 
request;
    d. Describe briefly the grounds for approval of the request; and
    e. State how additional information about a particular waiver may 
be obtained.
    Section 106 of the HUD Reform Act also contains requirements 
applicable to waivers of HUD handbook provisions that are not relevant 
to the purpose of this notice.
    This notice follows procedures provided in HUD's Statement of 
Policy on Waiver of Regulations and Directives

[[Page 31330]]

issued on April 22, 1991 (56 FR 16337). In accordance with those 
procedures and with the requirements of section 106 of the HUD Reform 
Act, waivers of regulations are granted by the Assistant Secretary with 
jurisdiction over the regulations for which a waiver was requested. In 
those cases in which a General Deputy Assistant Secretary granted the 
waiver, the General Deputy Assistant Secretary was serving in the 
absence of the Assistant Secretary in accordance with the office's 
Order of Succession.
    This notice covers waivers of regulations granted by HUD from 
January 1, 2019 through March 31, 2019. For ease of reference, the 
waivers granted by HUD are listed by HUD program office (for example, 
the Office of Community Planning and Development, the Office of Fair 
Housing and Equal Opportunity, the Office of Housing, and the Office of 
Public and Indian Housing, etc.). Within each program office grouping, 
the waivers are listed sequentially by the regulatory section of title 
24 of the Code of Federal Regulations (CFR) that is being waived. For 
example, a waiver of a provision in 24 CFR part 58 would be listed 
before a waiver of a provision in 24 CFR part 570.
    Where more than one regulatory provision is involved in the grant 
of a particular waiver request, the action is listed under the section 
number of the first regulatory requirement that appears in 24 CFR and 
that is being waived. For example, a waiver of both Sec.  58.73 and 
Sec.  58.74 would appear sequentially in the listing under Sec.  58.73.
    Waiver of regulations that involve the same initial regulatory 
citation are in time sequence beginning with the earliest-dated 
regulatory waiver.
    Should HUD receive additional information about waivers granted 
during the period covered by this report (the first quarter of calendar 
year 2019) before the next report is published (the second quarter of 
calendar year 2019), HUD will include any additional waivers granted 
for the first quarter in the next report.
    Accordingly, information about approved waiver requests pertaining 
to HUD regulations is provided in the Appendix that follows this 
notice.

    Dated: June 12, 2019.
J. Paul Compton Jr.,
General Counsel.

Appendix--Listing of Waivers of Regulatory Requirements Granted by 
Offices of the Department of Housing and Urban Development January 1, 
2019 Through March 31, 2019

    Note to Reader: More information about the granting of these 
waivers, including a copy of the waiver request and approval, may be 
obtained by contacting the person whose name is listed as the 
contact person directly after each set of regulatory waivers 
granted.
    The regulatory waivers granted appear in the following order:
    I. Regulatory waivers granted by the Office of Housing.
    II. Regulatory waivers granted by the Office of Public and 
Indian Housing.

I. Regulatory Waivers Granted by the Office of Housing--Federal Housing 
Administration (FHA)

    For further information about the following regulatory waivers, 
please see the name of the contact person that immediately follows 
the description of the waiver granted.

     Regulation: 24 CFR 206.41.
    Project/Activity: National Council on Aging HECM Financial 
Interview Tool No Longer Available (affects the HECM program 
nationally).
    Nature of Requirement: The Financial Interview Tool (FIT) 
assists counselors in following HUD's requirements in determining 
the borrowers' financial status. It is a required counseling 
requirement by the Commissioner under this regulation. The contract 
between the and NCOA for administering FIT has concluded. Therefore, 
HECM counselors are now prohibited from accessing FIT for purposes 
of providing HUD HECM counseling.
    Granted By: Sarah Gerecke, Deputy Assistant Secretary.
    Date Granted: February 28, 2019.
    Reason Waived: NHA section 255(f) and HECM regulations at 24 CFR 
206.41 address HECM counseling and require that a prospective 
borrower must receive adequate counseling, which involves 
discussions regarding options other than a reverse mortgage and 
financial implications. 24 CFR 214.3 defines counseling, in part, as 
``[cJounselor to client assistance that addresses unique financial 
circumstances or housing issues [of the client] In addition, the 
Housing Counseling Handbook at Appendix 4, Section III. C. Step 2, 
states, in part, that ``the counselor must create a budget using the 
Financial Interview Tool (FIT) Discussed in Attachment B.12 [of the 
Handbook] based on the client's income, assets, debt and expenses.'' 
Attachment B.12 [of the Handbook provides that ``[c]counselors will 
use the National Council on Aging's (NCOA) web-based FIT to meet the 
budget requirement.'' The contract between the Department and NCOA 
for administering FIT expired on January 8, 2018. Therefore, HECM 
counselors are now prohibited from accessing FIT for purposes of 
providing HUD HECM counseling. As a result, OHC needs to waive the 
above-referenced Handbook provisions which mandate the use of FIT. 
HECM counselors must, however, continue to meet all other statutory 
and regulatory counseling requirements and policies as clarified in 
the Handbooks, such as creating a budget.
    Contact: John Olmstead, Senior Housing Program Manager, Office 
of Policy and Grant Administration, Office of Housing, Department of 
Housing and Urban Development, Norris Cotton Federal Building, 275 
Chestnut Street, 4th Floor; Manchester, NH 03101-2487, telephone 
(802) 238-9003.

     Regulation: 24 CFR 219.220(b).
    Project/Activity: Westminster Village, FHA Project Number 083-
44016, Lexington, KY. Westminster Kentucky, LLC (Owner) seeks 
approval to defer repayment of the Flexible Subsidy Operating 
Assistance Loan on the subject project.
    Nature of Requirement: The regulation at 24 CFR 219.220(b) 
(1995), which governs the repayment of operating assistance provided 
under the Flexible Subsidy Program for Troubled Properties, states 
``Assistance that has been paid to a project owner under this 
subpart must be repaid at the earlier of the expiration of the term 
of the mortgage, termination of mortgage insurance, prepayment of 
the mortgage, or a sale of the project.''
    Granted By: Brian D. Montgomery, Assistant Secretary for 
Housing--Federal Housing Commissioner.
    Date Granted: March 15, 2019.
    Reason Waived: The owner requested and was granted waiver of the 
requirement to repay the Flexible Subsidy Operating Assistance Loan 
in full when it became due. Deferring the loan payment will preserve 
the affordable housing resource for an additional 40 years through 
the execution and recordation of a Rental Use Agreement.
    Contact: Munir Malik, Account Executive, Office of Housing, 
Department of Housing and Urban Development, 451 Seventh Street SW, 
Room 8236, Washington, DC 20410, telephone (202) 402-7589.

     Regulation: 24 CFR 266.200(b)(2).
    Project/Activity: The Massachusetts Housing Finance Agency 
(MassHousing) requested a waiver of certain provisions of the 542(c) 
Housing Finance Agency (HFA) Risk Sharing Program. The Department 
approved the request for forty (40) mortgages insured under the 
Section 542(c) HFA Risk Sharing Program for fiscal year 2019 (i.e., 
HUD issuance of a firm approval letter by September 30, 2019), Mass 
Housing, Boston, Massachusetts, no project names listed.
    Nature of Requirement: The Waiver of 24 CFR 266.200(b)(2), 
Substantial Rehabilitation. Substantial rehabilitation is defined as 
any combination of the following work to an existing facility of a 
project that aggregates to at least 15 percent of the project's 
value after the rehabilitation and that results in material 
improvement of the project's economic life, livability, 
marketability, and profitability. The Department will permit the 
revised definition of substantial rehabilitation (S/R) as described 
in the revised MAP Guide published on January 29, 2016, such that S/

[[Page 31331]]

R is: Any scope of work that either (a) Exceeds in aggregate cost a 
sum equal to the `base per dwelling unit limit' times the applicable 
*High Cost Factor, or (b) Replacement of two or more building 
systems. `Replacement' is when the cost of replacement work exceeds 
50 percent of the cost of replacing the entire system.
    *The High Cost Factors for 2017 were published through a Housing 
Notice (HN) on August 31, 2017, and the revised statutory limits 
were recently published in the Federal Register on November 7, 2017. 
The 2017 base dwelling unit amount to determine substantial 
rehabilitation for FHA insured loan programs has been increased from 
$15,000 (changed from $6,500 per unit in the 2016 MAP guide) to 
$15,315. This amount will change annually based upon the change in 
the annual Consumer Price Index (CPI), along with the statutory 
limits or other inflation cost index published by HUD.
    The regulatory waiver is subject to the following conditions:
    1. The waiver is limited to forty (40) projects and expires on 
September 30, 2019 for waiver request related to regulation 24 CFR 
266.200 (b)(2).
    2. MassHousing must elect to take 50 percent or more of the risk 
of loss on all transactions;
    3. In accordance with 24 CFR 266.200(d), the mortgage may not 
exceed an amount supportable by the lower of the Section 8 or 
comparable unassisted rents;
    4. Projects must comply with Davis-Bacon labor standards in 
accordance with 24 CFR 266.225;
    5. MassHousing must comply with regulations stated in 24 CFR 
266.210 for insured advances or insurance upon completion 
transactions;
    6. The loans exceeding $50 million require a separate waiver 
request;
    7. Occupancy is no less than 93 percent for previous 12 months;
    8. No defaults in the last 12 months of the HFA loan to be 
refinanced;
    9. A 20-year affordable housing deed restriction placed on title 
that conforms to the Section 542(c) statutory definition;
    10. A Property Capital Needs Assessment (PCNA) must be performed 
and funds escrowed for all necessary repairs, and reserves funded 
for future capital needs; and
    11. For projects subsidized by Section 8 Housing Assistance 
Payment (HAP) contracts:
    a: Owner agrees to renew HAP contract(s) for 20-year term, 
(subject to appropriations and statutory authorization, etc.), and 
b: In accordance with regulations in 24 CFR 883.306(e), and Housing 
Notice 2012-14--Use of ``New Regulation'' Section 8 Housing 
Assistance Payments (HAP) Contracts Residual Receipts of Offset 
Project-Based Section 8 Housing Assistance Payments, if at any time 
MassHousing determines that a project's excess funds (surplus cash) 
after project operations, reserve requirements and permitted 
distributions are met, MassHousing must place the excess funds into 
a separate interest-bearing account. Upon renewal of a HAP Contract 
the excess funds can be used to reduce future HAP payments or other 
project operations/purposes. When the HAP Contract expires, is 
terminated, or any extensions are terminated, any unused funds 
remaining in the Residual Receipt Account at the time of the 
contract's termination must be returned.
    Granted By: Brian D. Montgomery, Assistant Secretary for 
Housing- Federal Housing Commissioner.
    Date Granted: February 7, 2019.
    Reason Waived: Granted waivers of certain provisions under the 
542(c) HFA Risk- Sharing Program regulations for forty (40) 
mortgages through the fiscal year 2019. The waiver, under the Risk 
Sharing Program will provide more competitive financing options for 
developers and continue to create and preserve affordable housing in 
the State of Massachusetts.
    Contact: Patricia M. Burke, Acting Director, Office of 
Multifamily Production, Office of Housing, Department of Housing and 
Urban Development, 451 Seventh Street SW, Room 6130, Washington, DC 
20410-8000, telephone (202) 402-5693.

     Regulation: 24 CFR 266.200(c)(2).
    Project/Activity: The Massachusetts Housing Finance Agency 
(MassHousing), Risk Sharing Program, Equity Take Outs. Boston, 
Massachusetts, no project names listed.
    Nature of Requirements: The Department requires, in 24 CFR 
266.200(c)(2), Existing Project ``Equity Take-out'', that the 
refinancing of HFA refinance loan is permissible if the preservation 
is the result, with certain conditions: (1) Occupancy at least 93 
percent for previous 12 months; (2) underwrite to the lower of 
Section 8 or market rents; (3) no equity take-outs: Risk sharing 
loan cannot exceed sum of existing indebtedness, cost of repairs, 
and transaction costs; (4) no defaults in the last 12 months of HFA 
loans.
    The waiver of 24 CFR 266.200(c)(2) would permit equity take-outs 
for any existing property, including both MassHousing-financed 
developments and those outside of MassHousing's portfolio, to be 
refinanced by MassHousing, where MassHousing and HUD split the risk 
of loss 50/50.
    The regulatory waiver is subject to the following conditions:
    1. The waiver is limited to forty (40) projects and expires on 
September 30, 2019 for waiver request related to regulation 24 CFR 
266.200(c)(2).
    2. MassHousing must elect to take 50 percent or more of the risk 
of loss on all transactions;
    3. In accordance with 24 CFR 266.200(d), the mortgage may not 
exceed an amount supportable by the lower of the Section 8 or 
comparable unassisted rents;
    4. Projects must comply with Davis-Bacon labor standards in 
accordance with 24 CFR
    266.225.
    5. MassHousing must comply with regulations stated in 24 CFR 
266.210 for insured advances or insurance upon completion 
transactions;
    6. The loans exceeding $50 million require a separate waiver 
request;
    7. Occupancy is no less than 93 percent for previous 12 months;
    8. No defaults in the last 12 months of the HFA loan to be 
refinanced;
    9. A 20-year affordable housing deed restriction placed on title 
that conforms to the Section 542(c) statutory definition;
    10. A Property Capital Needs Assessment (PCNA) must be performed 
and funds escrowed for all necessary repairs, and reserves funded 
for future capital needs; and
    11. For projects subsidized by Section 8 Housing Assistance 
Payment (HAP) contracts:
    a: Owner agrees to renew HAP contract(s) for 20-year term, 
(subject to appropriations and statutory authorization, etc.), and 
b: In accordance with regulations in 24 CFR 883.306(e), and Housing 
Notice 2012-14--Use of ``New Regulation'' Section 8 Housing 
Assistance Payments (HAP) Contracts Residual Receipts of Offset 
Project-Based Section 8 Housing Assistance Payments, if at any time 
MassHousing determines that a project's excess funds (surplus cash) 
after project operations, reserve requirements and permitted 
distributions are met, MassHousing must place the excess funds into 
a separate interest-bearing account. Upon renewal of a HAP Contract 
the excess funds can be used to reduce future HAP payments or other 
project operations/purposes. When the HAP Contract expires, is 
terminated, or any extensions are terminated, any unused funds 
remaining in the Residual Receipt Account at the time of the 
contract's termination must be returned.
    Granted By: Brian D. Montgomery, Assistant Secretary for 
Housing-Federal Housing Commissioner.
    Date Granted: February 7, 2019.
    Reason Waived: The waiver would provide more competitive 
financing options for developers and to continue to create and 
preserve affordable housing in the State of Massachusetts.
    Contact: Patricia M. Burke, Acting Director, Office of 
Multifamily Production, HTD, Office of Housing, Department of 
Housing and Urban Development, 451 Seventh Street SW, Room 6130, 
Washington, DC 20410, telephone (202) 402-5693.

     Regulation: 24 CFR 266.410(e).
    Project/Activity: Mortgage Provisions ``Amortization. requires 
that the mortgage must provide for complete amortization (i.e., 
regularly amortizing) over the term of the mortgage. The waiver 
would permit balloon mortgages with a minimum term of 17 years with 
a maximum amortization period of up to 40 years.
    Nature of Requirement: The 24 CFR 266.410(e), which ``requires 
mortgages insured under the 542(c) Housing Finance Agency Risk 
Sharing Program to be fully amortized over the term of the mortgage. 
. . .'' The waiver would permit MassHousing to use balloon loans 
that would have a minimum term of 17 years and a maximum 
amortization period of 40 years.
    Granted By: Brian D. Montgomery, Assistant Secretary for 
Housing-Federal Housing Commissioner.
    Date Granted: February 7, 2019.
    Reason Waived: The waiver was granted to allow Mass Housing's 
clients additional financing options to their customers and to align 
Mass Housing business practices with industry standards. The waiver 
would permit MassHousing the ability to offer balloon

[[Page 31332]]

mortgages with a minimum term of 17 years for 50/50 risk sharing 
transactions. This waiver is effective from the date of issuance. 
The waiver has no time limit. The regulatory waiver is subject to 
the following conditions:
    1. The waiver is limited to ten (10) projects with no time 
limit.
    2. MassHousing must elect to take 50 percent or more of the risk 
of loss on all transactions;
    3. Mortgages made under this waiver may have amortization 
periods of up to 40 years, but with a minimum of 17 years;
    4. All other requirements of 24 CFR 266.410--Mortgage Provision 
remain applicable. The waiver is applicable only to loans made under 
MassHousing's Risk Sharing Agreement.
    5. In accordance with 24 CFR 266.200(d), the mortgage may not 
exceed an amount supportable by the lower of the Section 8 or 
comparable unassisted rents;
    6. Projects must comply with Davis-Bacon labor standards in 
accordance with 24 CFR 266.225;
    7. MassHousing must comply with regulations stated in 24 CFR 
266.210 for insured advances or insurance upon completion 
transactions;
    8. The loans exceeding $50 million require a separate waiver 
request;
    9. Occupancy is no less than 93 percent for previous 12 months;
    10. No defaults in the last 12 months of the HFA loan to be 
refinanced;
    11. A 20-year affordable housing deed restriction placed on 
title that conforms to the Section 542(c) statutory definition;
    12. A Property Capital Needs Assessment (PCNA) must be performed 
and funds escrowed for all necessary repairs, and reserves funded 
for future capital needs; and
    13. For projects subsidized by Section 8 Housing Assistance 
Payment (HAP) contracts:
    a: Owner agrees to renew HAP contract(s) for 20-year term, 
(subject to appropriations and statutory authorization, etc.), and 
b: In accordance with regulations in 24 CFR 883.306(e), and Housing 
Notice 2012-14--Use of ``New Regulation'' Section 8 Housing 
Assistance Payments (HAP) Contracts Residual Receipts of Offset 
Project-Based Section 8 Housing Assistance Payments, if at any time 
MassHousing determines that a project's excess funds (surplus cash) 
after project operations, reserve requirements and permitted 
distributions are met, MassHousing must place the excess funds into 
a separate interest-bearing account. Upon renewal of a HAP Contract 
the excess funds can be used to reduce future HAP payments or other 
project operations/purposes. When the HAP Contract expires, is 
terminated, or any extensions are terminated, any unused funds 
remaining in the Residual Receipt Account at the time of the 
contract's termination must be returned.
    Contact: Patricia M. Burke, Acting Director, Office of 
Multifamily Production, Office of Housing, Department of Housing and 
Urban Development, 451 Seventh Street SW, Room 6130, Washington, DC 
20410, telephone (202) 402-5693.

     Regulation: 24 CFR 266.410(e).
    Project/Activity: Minnesota Housing Finance Agency (Minnesota 
Housing), Mortgage Provisions ``Amortization: that the mortgage must 
provide for complete amortization (i.e. regularly amortizing) over 
the term of the mortgage. Minnesota Housing Finance Agency, 
(Minnesota Housing) Saint Paul, Minnesota, no project name listed.
    Nature of Requirement: The 24 CFR 266.410(e), which ``requires 
mortgages insured under the 542(c) Housing Finance Agency Risk 
Sharing Program to be fully amortized over the term of the mortgage. 
. . .'' The waiver would permit Minnesota Housing to use balloon 
loans that would have a minimum term of 17 years and a maximum 
amortization period of 40 years.
    Granted By: Brian D. Montgomery, Assistant Secretary for 
Housing-Federal Housing Commissioner.
    Date Granted: February 7, 2019.
    Reason Waived: The waiver was granted to allow Minnesota 
Housing's clients additional financing options to their customers 
and to align Minnesota Housing business practices with industry 
standards. The waiver would permit Minnesota Housing the ability to 
offer balloon mortgages with a minimum term of 17 years for 50/50 
risk sharing transactions. This waiver is effective from the date of 
issuance. The waiver expires on December 31, 2020. The regulatory 
waiver is subject to the following conditions:
    1. The waiver is limited to twenty (20) refinance transactions, 
ten (10) substantial rehabilitation transactions and ten (10) new 
construction transactions and expires on December 31, 2020.
    2. Minnesota Housing must elect to take 50 percent or more of 
the risk of loss on all transactions;
    3. Mortgages made under this waiver may have amortization 
periods of up to 40 years, but with a minimum of 17 years;
    4. All other requirements of 24 CFR 266.410- Mortgage Provision 
remain applicable. The waiver is applicable only to loans made under 
Minnesota Housing's Risk Sharing Agreement.
    5. In accordance with 24 CFR 266.200(d), the mortgage may not 
exceed an amount supportable by the lower of the Section 8 or 
comparable unassisted rents;
    6. Projects must comply with Davis-Bacon labor standards in 
accordance with 24 CFR 266.225;
    7. Minnesota Housing must comply with regulations stated in 24 
CFR 266.210 for insured advances or insurance upon completion 
transactions;
    8. The loans exceeding $50 million require a separate waiver 
request;
    9. Occupancy is no less than 93 percent for previous 12 months;
    10. No defaults in the last 12 months of the HFA loan to be 
refinanced;
    11. A 20-year affordable housing deed restriction placed on 
title that conforms to the Section 542(c) statutory definition;
    12. A Property Capital Needs Assessment (PCNA) must be performed 
and funds escrowed for all necessary repairs, and reserves funded 
for future capital needs; and
    13. For projects subsidized by Section 8 Housing Assistance 
Payment (HAP) contracts:
    a: Owner agrees to renew HAP contract(s) for 20-year term, 
(subject to appropriations and statutory authorization, etc.), and 
b: In accordance with regulations in 24 CFR 883.306(e), and Housing 
Notice 2012-14--Use of ``New Regulation'' Section 8 Housing 
Assistance Payments (HAP) Contracts Residual Receipts of Offset 
Project-Based Section 8 Housing Assistance Payments, if at any time 
Minnesota Housing determines that a project's excess funds (surplus 
cash) after project operations, reserve requirements and permitted 
distributions are met, Minnesota Housing must place the excess funds 
into a separate interest-bearing account. Upon renewal of a HAP 
Contract the excess funds can be used to reduce future HAP payments 
or other project operations/purposes. When the HAP Contract expires, 
is terminated, or any extensions are terminated, any unused funds 
remaining in the Residual Receipt Account at the time of the 
contract's termination must be returned.
    Contact: Patricia M. Burke, Acting Director, Office of 
Multifamily Production, Office of Housing, Department of Housing and 
Urban Development, 451 Seventh Street SW, Room 6130, Washington, DC 
20410, telephone (202) 402-5693.

     Regulation: 24 CFR 266.200(b)(2).
    Project/Activity: Rhode Island Housing and Mortgage Finance 
Corporation (RIHousing), a waiver of certain provisions of the 
542(c) Housing Finance Agency (HFA) Risk Sharing Program. The 
Department's approval request for a total of thirty-six (36) 
projects which includes twelve (12) projects identified in the 
Pipeline provided for mortgages insured under the 542(c) HFA Risk 
Sharing Program. Providence, RI.
    Nature of Requirement: The Waiver of 24 CFR 266.200(b)(2), 
Substantial Rehabilitation. Substantial Rehabilitation is defined as 
any combination of the following work to an existing facility of a 
project that aggregates to at least 15 percent of the project's 
value after the rehabilitation and that results in material 
improvements of the project's economic life, livability, 
marketability, and profitability. The Department will permit the 
revised definition of substantial rehabilitation (S/R) as described 
in the Revised MAP Guide published on January 29, 2016, such that S/
R is: Any scope of work that either (a) Exceeds in aggregate cost a 
sum equal to the `base per dwelling unit limit' times the applicable 
*High Cost Factor, or (b) Replacement of two or more building 
systems. `Replacement' is when the cost of replacement work exceeds 
50 percent of the cost of replacing the entire system.
    *The High Cost Factors for 2017 were published through a Housing 
Notice (HN) on August 31, 2017, and the revised statutory limits 
were recently published in the Federal Register on November 7, 2017. 
The 2017 base dwelling unit amount to determine substantial 
rehabilitation for FHA insured loan programs has been increased from 
$15,000 (changed from $6,500 per unit in the 2016 MAP guide) to 
$15,315. This amount will change annually based upon the change in 
the annual Consumer Price Index (CPI), along with the statutory 
limits or other inflation cost index published by HUD.
    The regulatory waiver is subject to the following conditions:

[[Page 31333]]

    1. The waiver is limited to thirty-six (36) projects and expires 
on December 31, 2021 for waiver request related to regulation 24 CFR 
266.200(b)(2).
    2. RIHousing must elect to take 50 percent or more of the risk 
of loss on all transactions;
    3. In accordance with 24 CFR 266.200(d), the mortgage may not 
exceed an amount supportable by the lower of the Section 8 or 
comparable unassisted rents;
    4. Projects must comply with Davis-Bacon labor standards in 
accordance with 24 CFR 266.225;
    5. RIHousing must comply with regulations stated in 24 CFR 
266.210 for insured advances or insurance upon completion 
transactions;
    6. The loans exceeding $50 million require a separate waiver 
request;
    7. Occupancy is no less than 93 percent for previous 12 months;
    8. No defaults in the last 12 months of the HFA loan to be 
refinanced;
    9. A 20-year affordable housing deed restriction placed on title 
that conforms to the Section 542(c) statutory definition;
    10. A Property Capital Needs Assessment (PCNA) must be performed 
and funds escrowed for all necessary repairs, and reserves funded 
for future capital needs; and
    11. For projects subsidized by Section 8 Housing Assistance 
Payment (HAP) contracts:
    a: Owner agrees to renew HAP contract(s) for 20-year term, 
(subject to appropriations and statutory authorization, etc.), and 
b: In accordance with regulations in 24 CFR 883.306(e), and Housing 
Notice 2012-14--Use of ``New Regulation'' Section 8 Housing 
Assistance Payments (HAP) Contracts Residual Receipts of Offset 
Project-Based Section 8 Housing Assistance Payments, if at any time 
RIHousing determines that a project's excess funds (surplus cash) 
after project operations, reserve requirements and permitted 
distributions are met, RIHousing must place the excess funds into a 
separate interest-bearing account. Upon renewal of a HAP Contract 
the excess funds can be used to reduce future HAP payments or other 
project operations/purposes. When the HAP Contract expires, is 
terminated, or any extensions are terminated, any unused funds 
remaining in the Residual Receipt Account at the time of the 
contract's termination must be returned.
    Granted By: Brian D. Montgomery, Assistant Secretary for 
Housing--Federal Housing Commissioner.
    Date Granted: February 7, 2019.
    Reason Waived: Granted waivers of certain provisions under the 
542(c) HFA Risk- Sharing Program regulations for thirty-six (36) 
projects which includes twelve (12) projects identified in the 
Pipeline provided for mortgages under the 5429(c) HFA Risk Sharing 
Program. The waiver will expire on December 31, 2021. The waiver, 
under the Risk Sharing Program will provide more competitive 
financing options for developers and continue to create and preserve 
affordable housing in the State of Rhode Island.
    Contact: Patricia M. Burke, Acting Director, Office of 
Multifamily Production, Office of Housing, Department of Housing and 
Urban Development, 451 Seventh Street SW, Room 6130, Washington, DC 
20410, telephone (202) 402-5693.

     Regulation: 24 CFR 266.200(c)(2).
    Project/Activity: The Rhode Island Housing and mortgage Finance 
Corporation (RIHousing), Risk Sharing Program, Equity Take Outs. 
Providence, Rhode Island.
    The Department requires, in 24 CFR 266.200(c)(2), Existing 
Project ``Equity Take-out'', that the refinancing of HFA refinance 
loan is permissible if the preservation is the result, with certain 
conditions: (1) Occupancy at least 93 percent for previous 12 
months; (2) underwrite to the lower of Section 8 or market rents; 
(3) no equity take-outs: Risk sharing loan cannot exceed sum of 
existing indebtedness, cost of repairs, and transaction costs; (4) 
no defaults in the last 12 months of HFA loans.
    Nature of Requirements: The waiver of 24 CFR 266.200(c)(2) would 
permit equity take-outs of the RIHousing financed project and those 
outside of RIHousing `s portfolio resulting in preservation where 
the insured mortgage exceeds the sum of the total cost of 
acquisition, cost of financing, cost of repairs, and reasonable 
transaction cost, or ``equity take-out'' risk sharing refinancing 
where RIHousing and HUD split the risk of loss 50/50.
    The regulatory waiver is subject to the following conditions:
    1. The waiver is limited to thirty-six (36) projects and expires 
on December 31, 2021 for waiver request related to regulation 24 CFR 
266.200(c)(2).
    2. RIHousing must elect to take 50 percent or more of the risk 
of loss on all transactions;
    3. In accordance with 24 CFR 266.200(d), the mortgage may not 
exceed an amount supportable by the lower of the Section 8 or 
comparable unassisted rents;
    4. Projects must comply with Davis-Bacon labor standards in 
accordance with 24 CFR 266.225;
    5. RIHousing must comply with regulations stated in 24 CFR 
266.210 for insured advances or insurance upon completion 
transactions;
    6. The loans exceeding $50 million require a separate waiver 
request;
    7. Occupancy is no less than 93 percent for previous 12 months;
    8. No defaults in the last 12 months of the HFA loan to be 
refinanced;
    9. A 20-year affordable housing deed restriction placed on title 
that conforms to the Section 542(c) statutory definition;
    10. A Property Capital Needs Assessment (PCNA) must be performed 
and funds escrowed for all necessary repairs, and reserves funded 
for future capital needs; and
    11. For projects subsidized by Section 8 Housing Assistance 
Payment (HAP) contracts:
    a: Owner agrees to renew HAP contract(s) for 20-year term, 
(subject to appropriations and statutory authorization, etc.), and 
b: In accordance with regulations in 24 CFR 883.306(e), and Housing 
Notice 2012-14--Use of ``New Regulation'' Section 8 Housing 
Assistance Payments (HAP) Contracts Residual Receipts of Offset 
Project-Based Section 8 Housing Assistance Payments, if at any time 
RIHousing determines that a project's excess funds (surplus cash) 
after project operations, reserve requirements and permitted 
distributions are met, RIHousing must place the excess funds into a 
separate interest-bearing account. Upon renewal of a HAP Contract 
the excess funds can be used to reduce future HAP payments or other 
project operations/purposes. When the HAP Contract expires, is 
terminated, or any extensions are terminated, any unused funds 
remaining in the Residual Receipt Account at the time of the 
contract's termination must be returned.
    Granted By: Brian D. Montgomery, Assistant Secretary for 
Housing--Federal Housing Commissioner.
    Date Granted: February 7, 2019.
    Reason Waived: Under 542(c) Housing Financing Agency (HFA) Risk 
Sharing Program, will create and preserve affordable housing in the 
State of Rhode Island.
    Contact: Patricia M. Burke, Acting Director, Office of 
Multifamily Production, Office of Housing, Department of Housing and 
Urban Development, 451 Seventh Street SW, Room 6130, Washington, DC 
20410, telephone (202) 402-5693.

II. Regulatory Waivers Granted by the Office of Public and Indian 
Housing

    For further information about the following regulatory waivers, 
please see the name of the contact person that immediately follows 
the description of the waiver granted.

     Regulation: 24 CFR 983.354(a).
    Project/Activity: Revitz House Corporation c/o Hebrew Home of 
greater Washington, Inc. in Rockville, Maryland, requested a waiver 
of 24 CFR 983.354(a) to allow low income residents of Revitz House 
to receive Project-Based Voucher (PBV) rental assistance and 
participate in the mandatory meals program.
    Nature of Requirement: The regulation 24 CFR 983.354(a) states 
that except as provided in paragraph (a)(2) of this section, the 
owner may not require the tenant or family members to pay charges 
for meals or supportive services. Non-payment of such charges is not 
grounds for termination of tenancy. 24 CFR 983.354(a) (2) states 
that in assisted living developments receiving project-based 
assistance, owners may charge tenants, family members, or both for 
meals or supportive services. These charges may not be included in 
the rent to owner, nor may the value of meals and supportive 
services be included in the calculation of reasonable rent. Non-
payment of such charges is grounds for termination of the lease by 
the owner in an assisted living development.
    Granted By: Dominique Blom, General Deputy Assistant Secretary.
    Date Granted: February 19, 2019.
    Reason Waived: Revitz House's Section 236 loan matures on April 
1, 2019 and will be applying for Tenant-Protection Set-Aside funding 
in the form of PBV assistance under PIH Notice 2018-02. Revitz House 
has had a long-standing mandatory meals program, which was allowed 
under the Section 236 program. However, the PBV rules do not allow 
for such a provision. It was determined that it would be financially 
infeasible to convert an existing mandatory meals program to a 
voluntary program which would in turn increase the cost of the meals 
program for

[[Page 31334]]

those residents who choose to stay. Because the residents live on a 
fixed income, such a cost increase would make the program cost-
prohibitive and likely cause the program to end. Without the 
program, resident's health would be at risk because many of them are 
unable to prepare meals themselves.
    Contact: Becky Primeaux, Housing Voucher Management and 
Operations Division, Office of Public Housing and Voucher Programs, 
Office of Public and Indian Housing, Department of Housing and Urban 
Development, 451 Seventh St. SW, Room 4216, Washington, DC 20410, 
telephone (202) 708-0477.

     Regulation: 24 CFR 982.633(a).
    Project/Activity: Belmont Housing Authority in Buffalo, New York 
requested a waiver of 24 CFR 982.633(a) to allow the PHA to continue 
paying homeownership assistance payments for a family unable to live 
in the unit.
    Nature of Requirement: The regulation at 24 CFR 982.633(a) 
states that homeownership assistance may only be paid while the 
family is residing in the home.
    Granted By: Dominique Blom, General Deputy Assistant Secretary.
    Date Granted: February 25, 2019.
    Reason Waived: The waiver was approved because it is consistent 
with the Department's position of approving similar waivers for 
unforeseen circumstances, such as disasters.
    Contact: Becky Primeaux, Housing Voucher Management and 
Operations Division, Office of Public Housing and Voucher Programs, 
Office of Public and Indian Housing, Department of Housing and Urban 
Development, 451 Seventh St. SW, Room 4216, Washington, DC 20410, 
telephone (202) 708-0477.

     Regulation: 24 CFR 982.161(a).
    Project/Activity: The Brown County Housing Authority in Green 
Bay, Wisconsin requested a waiver of 24 CFR 982.161(a) due to a 
conflict of interest.
    Nature of Requirement: The regulation 24 CFR 982.161(a) states 
that neither the public housing agency (PHA) nor any of its 
contractors or subcontractors may enter into any contract or 
arrangement in connection with the HCV program with any present or 
former member or officer of the PHA (except a participant 
commissioner) during tenure or for one year thereafter.
    Granted By: Dominique Blom, General Deputy Assistant Secretary.
    Date Granted: March 8, 2019.
    Reason Waived: This waiver was approved to prevent hardship of 
requiring the family to move, particularly upon uncertainty of 
finding a unit in the same neighborhood or potentially losing the 
housing assistance which covers the rent in its entirety.
    Contact: Becky Primeaux, Housing Voucher Management and 
Operations Division, Office of Public Housing and Voucher Programs, 
Office of Public and Indian Housing, Department of Housing and Urban 
Development, 451 Seventh St. SW, Room 4216, Washington, DC 20410, 
telephone (202) 708-0477.

     Regulation: 24 CFR 983.152(c) pursuant to 24 CFR 5.110.
    Project/Activity: The Housing and Redevelopment Authority of 
Duluth of Minnesota, in Duluth, Minnesota, requested a waiver of 24 
CFR 983.152(c)
    Nature of Requirement: The regulation 24 CFR 983.152(c) 
prohibits a PHA from entering into an Agreement to enter into a 
Housing Assistance Payment (HAP) contract with an owner if the owner 
has commenced construction or rehabilitation activity after 
submitting the Project-based Voucher (PBV) proposal.
    Granted By: Dominique Blom, General Deputy Assistant Secretary 
for Public and Indian Housing.
    Date Granted: February 13, 2019.
    Reason Waived: This waiver was approved due to compelling and 
unique circumstances that resulted in the PHA and owner failing to 
execute the AHAP prior to commencing construction.
    Contact: Becky Primeaux, Housing Voucher Management and 
Operations Division, Office of Public Housing and Voucher Programs, 
Office of Public and Indian Housing, Department of Housing and Urban 
Development, 451 Seventh St. SW, Room 4216, Washington, DC 20410, 
telephone (202) 708-0477.

     Regulation: 24 CFR 982.161(a) and 24 CFR 982.161(c).
    Project/Activity: The Eagle Pass Housing Authority in Eagle 
Pass, Texas, requested a waiver of 24 CFR 982.161(c), because of a 
potential conflict of interest with an immediate family member of a 
local public official.
    Nature of Requirement: The regulation 24 CFR 982.161(a), states 
that any public official, member of a governing body, or State or 
local legislator, who exercises functions or responsibilities with 
respect to the program, may not have any direct or indirect interest 
in the HAP contract or in any benefits or payments under the 
contract during tenure or one year thereafter. This includes the 
interest of an immediate family member, including a parent, of the 
covered individual.
    Granted By: Dominique Blom, General Deputy Assistant Secretary.
    Date Granted: March 27, 2019.
    Reason Waived: This waiver was approved to allow units to remain 
on the program and prevent hardship of requiring the family to move, 
particularly upon uncertainty of finding a unit in the same 
neighborhood or potentially losing the housing assistance which 
covers the rent in its entirety.
    Contact: Becky Primeaux, Housing Voucher Management and 
Operations Division, Office of Public Housing and Voucher Programs, 
Office of Public and Indian Housing, Department of Housing and Urban 
Development, 451 Seventh St. SW, Room 4216, Washington, DC 20410, 
telephone (202) 708-0477.

     Regulation: 24 CFR 983.301(f)(2)(ii) and 24 CFR 
982.517.
    Project/Activity: The Housing Authority of the County of Contra 
Costa in Martinez, California, requested a waiver from HUD to allow 
for the use of a site-specific utility allowance.
    Nature of Requirement: The regulation 24 CFR 983.301(f)(2)(ii) 
states that ``The same PHA utility allowance schedule applies to 
both the tenant-based and PBV programs''. The regulation 24 CFR 
982.517 requires that the utility allowance schedule must be 
determined based on the typical cost of utilities and services paid 
by energy conservative households using normal patterns of 
consumption for the community as a whole.
    Granted By: Dominique Blom, General Deputy Assistant Secretary.
    Date Granted: February 13, 2019.
    Reason Waived: This waiver was approved because it was 
determined based on the information submitted, the utility 
allowances as currently calculated, would be excessive thus 
discouraging conservation and efficient use of HAP funds.
    Contact: Becky Primeaux, Housing Voucher Management and 
Operations Division, Office of Public Housing and Voucher Programs, 
Office of Public and Indian Housing, Department of Housing and Urban 
Development, 451 Seventh St. SW, Room 4216, Washington, DC 20410, 
telephone (202) 708-0477.

     Regulation: 24 CFR 905.400(i)(5)(i).
    Project/Activity: Housing Authority of Indiana County (HAIC), 
PA.
    Nature of Requirement: The housing authority is requesting a 
waiver of 24 CFR 905.400(i)(5)(i) for several First Increment 
Replacement Housing Factor (RHF) grants.
    Granted By: Dominique Blom, General Deputy Assistant Secretary.
    Date Granted: March 8, 2019.
    Reason Waived: The current regulation requires that the housing 
authority use RHF grant funds for the development of replacement 
housing only. Consequently, RHF cannot be used for any modernization 
activities unless the Department grants a waiver for good cause. The 
housing authority is not able to use RHF funds, totaling $139,280, 
to acquire residential units due to market conditions. HAIC 
administers 158 Public Housing units. Rather than returning the 
funds, the housing authority would like to use the RHF grants for 
security cameras and lighting. In accordance with 24 CFR 5.110, good 
cause has been determined, and hereby approve the housing 
authority's request for a waiver to use funds to pay for 
modernization work.
    Contact: David Fleischman, Director, Office of Capital Program 
Division. Office of Public and Indian Housing, Department of Housing 
and Urban Development, 451 Seventh St. SW, Room, Washington, DC 
20410, telephone (202) 402-2071.

     Regulation: 24 CFR 902.
    Project/Activity: Housing Authority of Springfield (FL035).
    Nature of Requirement: The regulation establishes guidelines to 
determine whether a public housing authority or agency (PHA) is 
meeting the standard of decent, safe, sanitary housing in good 
repair (DSS/GR). It is incumbent upon the Department to ensure that 
living conditions of occupied units are within regulation 
compliance.
    Granted By: Dominique Blom, General Deputy Assistant Secretary.
    Date Granted: February 6, 2019.
    Reason Waived: The Housing Authority of Springfield (HA) 
requested assistance under ``Relief from HUD Requirements Available 
to

[[Page 31335]]

PHAs During CY 2018 to Assist with Recovery and Relief Efforts on 
Behalf of Families Affected by Disasters,'' FR-6050-N-02. The HA 
incurred damages resulted from Hurricane Michael and is within the 
Bay County of the applicable Major Disaster Declaration. The Housing 
Authority of Springfield serves Public Housing and Housing Choice 
Voucher families in Florida.
    Contact: Dee Ann R. Walker, Program Manager, NASS, Real Estate 
Assessment Center, Office of Public and Indian Housing, Department 
of Housing and Urban Development, 550 12th Street SW, Suite 100, 
Washington, DC 20410, telephone (202) 475-7908.

[FR Doc. 2019-14012 Filed 6-28-19; 8:45 am]
 BILLING CODE 4210-67-P