Rural Housing Service 2007 – Federal Register Recent Federal Regulation Documents

This Final Rule implements a change in the regulations for the Rural Housing Service (RHS) 502 Direct Single Family Housing Loans by amending the formula that calculates payment assistance for which a borrower qualifies. This action is being taken to improve the distribution of program benefits, simplify the application process and improve customer service. This Final Rule follows the publication of the Proposed Rule on February 17, 2006, and takes into consideration the public comments received in response to the Proposed Rule.

The Rural Housing Service (Agency) is amending its regulations to be consistent with other Federal agencies. The current thermal standards for existing single family housing can impose an unnecessary financial burden on the borrower and are not always cost-effective. Removing the thermal standards for existing single family housing will provide consistency with HUD. This change will not affect the thermal standards for new construction; such requirements are generally prescribed by adopted building and model energy codes. Construction materials and building techniques have improved tremendously during the last thirty years, creating many alternatives to achieve thermally efficient homes. Removing the Agency's imposed thermal standards for existing single family housing will give a borrower the opportunity to allocate money towards other improvements which may result in higher cost savings. The rule will not result in any increase in costs or prices to consumers; non-profit organizations; businesses; Federal, State, or local government agencies; or geographic regions.

In accordance with the Paperwork Reduction Act of 1995, this notice announces the Rural Housing Service's intention to request an extension for a currently approved information collection in support of the program of the Agency's use of supervised bank accounts (SBA).

Rural Development, a mission area within the U.S. Department of Agriculture, is proposing a unified guaranteed loan platform for enhanced delivery of four existing Rural Development guaranteed loan programsCommunity Facility; Water and Waste Disposal; Business and Industry; and Renewable Energy Systems and Energy Efficiency Improvement Projects. This proposed rule would eliminate the existing loan guarantee regulations for these four programs and consolidate them under a new, single part. In addition to consolidating these four programs, the proposed rulemaking incorporates provisions that will enable the Agency to better manage the risk associated with making and servicing guaranteed loans and that will reduce the cost of operating the guaranteed loan programs. Such provisions include incorporating specific project eligibility criteria, revisions to the requirements for lenders to participate in the programs, allowing approved lenders to become preferred lenders, and allowing guaranteed loan applications to be submitted with less documentation accompanying the application under certain conditions.

In accordance with the Paperwork Reduction Act of 1995, this notice announces the Rural Housing Service's (RHS's) intention to request an extension for a currently approved information collection in support of 7 CFR 3560, Direct Multi-Family Housing Loans and Grants.

The Rural Housing Service published a document in the Federal Register on July 17, 2007, requesting proposals for housing demonstration program for agriculture, aquaculture, and seafood processing and/or fishery workers grant funds. The deadline date for the submission of applications was inadvertently omitted from the notice.

In accordance with the Paperwork Reduction Act of 1995, this notice announces the Rural Housing Service's intention to request an extension for a currently approved information collection in support of the program for Technical and Supervisory Assistance (TSA) grants.

The Rural Housing Service, an agency under USDA, Rural Development announces it is soliciting competitive applications under its Technical and Supervisory Assistance (TSA) grant program. Grants will be awarded to eligible applicant organizations to conduct programs of technical and supervisory assistance for low-income rural residents to obtain and/or maintain occupancy of adequate housing. Dates: The deadline for receipt of preapplication proposals by USDA, Rural Development State Offices is the close of business on July 20, 2007. Preapplications received after July 20, 2007 will not be considered for funding. Within 30 days after the closing date, each State Director will forward to the National Office the original preapplication(s) and supporting documents of the selected applicant. State Directors will be advised of the National Office's action on their selected preapplications. For Further Information Contact: Nica Mathes, Senior Loan Specialist, USDA Rural Development, Single Family Housing Direct Loan Division, Special Programs and New Initiatives Branch, Mail Stop 0783, Room 2206-S, 1400 Independence Avenue, SW., Washington, DC 20250-0783, phone: (202) 205-3656 or (202) 720-1474, e-mail: nica.mathes@wdc.usda.gov , or FAX: (202) 720-2232.

Through this Notice of Funds Availability (NOFA), the Agency announces the implementation of a demonstration program under the section 538 Guaranteed Rural Rental Housing Program (GRRHP) pursuant to 7 CFR 3565.4 for Fiscal Year (FY) 2007 and 7 CFR 3565.17 Demonstration programs. The Demonstration Program's purpose is to test the viability and efficacy of the concept of a continuous loan note guarantee through the construction and permanent loan financing phases of a project. Those applications that meet the Demonstration Program's qualifying criteria and are selected to participate will be offered one loan note guarantee upon closing of the construction loan that will be in effect throughout both of the project's construction and permanent phases without interruption. To be considered for participation in the Demonstration Program, in addition to responding to this NOFA, a Lender must have first submitted its application under either the GRRHP's 2007 Notice at 72 FR 8339 (Feb. 26, 2007) or the GRRHP's 2006 Notice at 71 FR 4559 (Jan. 27, 2006). Furthermore, the application to be considered must have been obligated from October 1, 2006 to July 31, 2007. The funding for the Demonstration Program will be approximately $10 million. Expenses incurred in developing applications will be at the applicant's risk. The following paragraphs outline the timeframes, eligibility requirements, lender responsibilities, and the overall response and application processes. Eligible Lenders wishing to have their FY 2007 obligations considered for the Demonstration Program must send a signed request on its letterhead with the proposed project details as outlined in the ``Demonstration Program Response Submission Address'' section of this NOFA. Demonstration Program Guidelines: The following guidelines are being provided to facilitate a structured implementation of the program: 1. Demonstration guarantee. The Demonstration guarantee is a guarantee that will be offered to those applications that apply for and meet the 2007 Demonstration NOFA's demonstration program's qualifying criteria. The Demonstration guarantee will consist of one loan note guarantee upon closing of the construction loan that will be in effect throughout both of the project's construction and permanent financing phases without interruption. 2. Upon approval of an application from an approved lender, the Agency will commit to providing a demonstration guarantee for the construction and permanent financing phases of the project, subject to the availability of funds. 3. Guarantee percentage and payment. Both construction loan advances and permanent loans are eligible for a guaranty subject to the following limitations: Construction loan advances and permanent loans. The Agency may guarantee a construction contract which has credit enhancements to protect the Government's interest. The Agency can guarantee the ``construction and permanent'' financing phases of a project. The Agency cannot, however, guarantee only the ``construction'' financing phase of a project. Guarantees under the demonstration guarantee will cover construction loan advances and the subsequent permanent loan. A demonstration guarantee requires an additional operating reserve equal to 2% of the appraised value of the project or total development costs, whichever is greater, to be set aside prior to closing the construction loan. This cash contribution is an additional amount, over and above the required initial operating and maintenance contribution. The maximum guarantee of construction advances will not at any time exceed the lesser of 90 percent of the amount of principal and interest up to default advanced for eligible uses of loan proceeds or 90 percent of the original principal amount and interest up to default of a loan. Penalties incurred as a result of default are not covered by the guarantee. The Agency may provide a lesser guarantee based upon its evaluation of the credit quality of the loan. 4. A lender making a construction loan must demonstrate an ability to originate and service construction loans. 5. Guarantee during construction. The Agency will issue a demonstration guarantee only to an approved lender. 6. Demonstration guarantee program compliance requirement. For a demonstration guarantee, the following items will have to be submitted in order to remain compliant with program requirements. The items must be submitted within the timeframe stipulated by the Agency and must also be approved by the Agency: (1) A certificate of substantial completion; (2) A certificate of occupancy or similar evidence of local approval; (3) A final cost certification in a form acceptable to the Agency; (4) A complete copy of the permanent loan closing docket; and (5) Necessary information to complete an updated necessary assistance review by the Agency. The Agency may declare the loan in default if the Lender fails to comply with the demonstration guarantee program guidelines. The Agency may also declare the loan in default if the Agency's final inspection is not satisfactory. To facilitate the implementation of the program, certain program forms may be addended to include relevant Demonstration Program requirements. The selected applicants will be subject to the Demonstration Program guidelines in this NOFA, and GRRHP's controlling statute, regulations, and handbook as amended. The GRRHP operates under the Housing Act of 1949 and regulations at 7 CFR part 3565. The GRRHP Origination and Servicing Handbook (HB-1-3565) is available to provide lenders and the general public with guidance on program administration. HB-1-3565, which contains a copy of 7 CFR part 3565 in Appendix 1, can be found at the Rural Development Instructions Web site address https:// www.rurdev.usda.gov/regs/hblist.html#hbw6. Demonstration Program Eligibility: Applications that meet the following criteria will be eligible for consideration to be selected into the Demonstration Program: 1. The project must have been awarded tax credits. 2. The project must have a loan to cost (LTC) ratio equal to or lower than 50%. 3. The Lender must have submitted [for this project] a loan guarantee application under either the GRRHP's 2007 Notice at 72 FR 8339 (Feb. 26, 2007) or the GRRHP's 2006 Notice at 71 FR 4559 (Jan. 27, 2006). Additionally, the application to be considered must have been obligated from October 1, 2006 to July 31, 2007. 4. The Lender must have submitted a timely response to this NOFA in accordance with the ``Demonstration Program Response Submission Address'' section of this NOFA. Demonstration Program Selection Process: Selections from qualified obligations that have requested consideration will be made based on their interest credit scores, with the highest scoring obligations, being selected first, until all available Demonstration Program funds are allocated. In the event of a tie, priority will be given to the project that: is in the smaller rural community, and in case of a subsequent tie has the lowest LTC ratio. Selections into the Demonstration Program will be made on August 14, 2007, from the qualified pool of applications that were obligated from October 1, 2006 to July 31, 2007. In the event there are not enough qualified requests for selection into the Demonstration Program to utilize all the available Demonstration Program set-aside funds of approximately $10 million, then the selection process for any remaining funds will be conducted again on September 11, 2007, and will include all applications obligated from October 1, 2006 to August 31, 2007. All applicants will be notified of the selection results no later than 15 business days from the date of selection. Demonstration Program Response Submission Address: Eligible lenders wishing to have their obligated applications considered for selection into the Demonstration Program must submit a signed request (not to exceed one page) on its letterhead that includes the following information: 1. Developer's Name. 2. Borrower's Name. 3. Project's Name. 4. Project's Address (City and State). 5. Project Type (Family, Senior, or Mixed). 6. Project's Total Units. 7. Project's Total Development Cost (TDC). 8. Amount of 538 Loan Guarantee. 9. Amount of Tax Credits Awarded. 10. Amount and Source of Other Financing. 11. Loan to Cost (LTC) %. 12. Area Population. 13. Date obligated or date of Conditional Commitment. Send the Demonstration Program Response Submission Letter with all of the information listed above, along with a copy of the State Office's ``Proceed with Application/NOFA Response Selection'' letter and a copy of the tax credit award notification to: C.B. Alonso, Senior Loan Specialist, Multi-Family Housing Processing Division, Guaranteed Rural Rental Housing Program, U.S. Department of Agriculture, South Agriculture Building, Room 1271, Stop 0781, 1400 Independence Avenue, SW., Washington, DC 20250-0781. Requests may also be faxed to 202-205-5066 or sent by e-mail (signed PDF copies of the above submissions) to cb.alonso@wdc.usda.gov. Eligible lenders mailing a request must provide sufficient time to permit delivery to the SUBMISSION ADDRESS on or before August 13, 2007. Acceptance by a U.S. Post Office or private mailer does not constitute delivery. Postage due responses and applications will not be accepted. The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, sex, religion, age, disability, political beliefs, sexual orientation, marital status or family status (not all prohibited basis apply to all programs). Persons with disabilities who require alternative means for communication of program information (Braille, large print, audiotape, etc.) should contact the USDA's Target Center at (202) 720-2600 (voice or TDD). To file a complaint of discrimination, write USDA, Director, Office of Civil Rights, Room 326-W, Whitten Building, 1400 Independence Avenue, SW., Washington, DC 20250-9410, or call toll free (866) 632- 9992 (Voice). TDD users can contact USDA through local relay (800) 720- 6382 (TDD) or (866) 377-8642 (relay voice users). USDA is an equal opportunity provider and employer.

The Rural Housing Service (RHS) announces the availability of housing funds for fiscal year (FY) 2007. This action is taken to comply with 42 U.S.C. 1490p, which requires that RHS publish in the Federal Register notice of the availability of any housing assistance.

This action proposes to replace the Mutual and Self-Help Housing Program's (MSH) administration under 7 CFR part 1944, Subpart I with 7 CFR part 3551. This rule will apply to grants executed after the effective date of the final rule. The Rural Housing Service (an agency within the Rural Development mission area) proposes to streamline and clarify its regulations for MSH. This action is taken to reduce regulations, improve customer service and enhance efficiency, flexibility, and effectiveness in managing the program.

In accordance with the Paperwork Reduction Act of 1995, this notice announces the Rural Housing Service's (RHS) intention to request an extension for a currently approved information collection in support of the program for Fire and Rescue Loans.

USDA Rural Development administers the programs of Rural Housing Service (RHS) announces the availability of funds and the timeframe to submit applications to participate in a demonstration program to preserve and revitalize existing rural rental housing projects financed by Rural Development under Section 515 of the Housing Act of 1949. The intended effect is to restructure selected existing Section 515 loans expressly for the purpose of ensuring that sufficient resources are available to preserve the rental project for the purpose of providing safe and affordable housing for very low-, low-, or moderate-income residents. Expectations are that properties participating in this program will be revitalized and affordable use extended without displacing tenants because of increased rents. No additional Rural Development rental assistance units will be made available under this program.

The Rural Housing Service (RHS) announces that it is soliciting applications under its Housing Preservation Grant (HPG) program. The HPG program is a grant program which provides qualified public agencies, private nonprofit organizations, and other eligible entities grant funds to assist very low- and low-income homeowners in repairing and rehabilitating their homes in rural areas. In addition, the HPG program assists rental property owners and cooperative housing complexes in repairing and rehabilitating their units if they agree to make such units available to low- and very low-income persons. This action is taken to comply with Agency regulations found in 7 CFR part 1944, subpart N, which require the Agency to announce the opening and closing dates for receipt of preapplications for HPG funds from eligible applicants. The intended effect of this Notice is to provide eligible organizations notice of these dates.

In accordance with the Paperwork Reduction Act of 1995, this notice announces the intention of the above-named Agency to request an extension for a currently approved information collection in support of the Community Facilities Grant Program.

Through this action, the Rural Housing Service (RHS) is proposing to amend its regulation to change the requirements of the Reserve Account for the Sections 514/516 Farm Labor Housing program and the Section 515 Rural Rental Housing (RRH) program. The intended effect of this action is to address reserve account requirements of new construction rental housing funded under Sections 514/516 and Section 515 and does not affect reserve accounts for existing portfolios.

In accordance with the Paperwork Reduction Act of 1995, this notice announces the Agencies intention to request an extension for a currently approved information collection in support of the Real Estate Title Clearance and Loan Closing regulation.

Through this action, the Rural Housing Service (RHS) is adopting homeownership education requirements. The lack of homeownership education is a well-known barrier to successful homeownership for many families. The intended effect of this action is to assure that first time homeowners financed under the Section 502 Direct program are well prepared for homeownership by assuring that they receive homeownership education.