This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

22631 

Vol. 76, No. 78 

Friday, April 22, 2011 

DEPARTMENT OF AGRICULTURE 

Rural Housing Service 

Rural Business-Cooperative Service 

Rural Utilities Service 

Farm Services Agency 

7 CFR Part 1942 

RIN 0575–AC78 

Community Facility Loans 

AGENCY: Rural Housing Service, Rural 

Business-Cooperative Service, Rural 

Utilities Service, Farm Services Agency, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: The U.S. Department of 

Agriculture proposes to amend its 

regulations to maintain consistency 

with standard industry contracts and to 

make minor revisions to streamline 

processing applications. These revisions 

are needed to conform with market and 

industry changes by updating, 

clarifying, and modifying the regulatory 

requirements for community facility 

construction and development. The 

amendments to the regulation will 

streamline current processes and 

provide for faster reviews of alternate 

construction contract methods (such as 

Design/Build and Construction 

Management) by the Agency’s National 

Office. This rule can also apply to 

applications under the Rural BusinessCooperative Service Programs. 

DATES: Written comments on the 

proposed rule must be received on or 

before June 21, 2011 to be assured of 

consideration. 

ADDRESSES: You may submit comments 

on this rule by any of the following 

methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Mail: Submit written comments via 

the U.S. Postal Service to the Branch 

Chief, Regulations and Paperwork 

Management Branch, U.S. Department 

of Agriculture, STOP 0742, 1400 

Independence Avenue, SW., 

Washington, DC 20250–0742. 

• Hand Delivery/Courier: Submit 

written comments via Federal Express 

Mail or another mail courier service 

requiring a street address to the Branch 

Chief, Regulations and Paperwork 

Management Branch, U.S. Department 

of Agriculture, 300 7th Street, SW., 7th 

Floor, Suite 701, Washington, DC 20024. 

All written comments will be 

available for public inspection during 

regular work hours at the 300 7th Street, 

SW., address listed above. 

FOR FURTHER INFORMATION CONTACT: 

William Downs, Technical Support 

Branch, Program Support Staff, Rural 

Housing Service, U.S. Department of 

Agriculture, STOP 0761, 1400 

Independence Avenue, SW., 

Washington, DC 20250–0761; 

Telephone: 202–720–1499; FAX: 202– 

690–4335; E-mail: 

william.downs@wdc.usda.gov. 

SUPPLEMENTARY INFORMATION: 

Classification 

This rule has been determined to be 

not significant for purposes of Executive 

Order 12866 and, therefore, has not 

been reviewed by the Office of 

Management and Budget (OMB). 

Civil Justice Reform 

This rule has been reviewed in 

accordance with Executive Order 12988, 

Civil Justice Reform. Except where 

specified, all State and local laws and 

regulations that are in direct conflict 

with this rule will be preempted. 

Federal funds carry Federal 

requirements. No person is required to 

apply for funding under this program, 

but if they do apply and are selected for 

funding, they must comply with the 

requirements applicable to the Federal 

program funds. This rule is not 

retroactive. It will not affect agreements 

entered into prior to the effective date 

of this rule. Before any judicial action 

may be brought regarding the provisions 

of this rule, the administrative appeal 

provisions of 7 CFR parts 11 and 780 

must be exhausted. 

Regulatory Flexibility Act 

The Administrator of the Agency has 

determined that this rule will not have 

a significant economic impact on a 

substantial number of small entities as 

defined in the Regulatory Flexibility Act 

(5 U.S.C. 601 et seq.). New provisions 

included in this rule will not impact a 

substantial number of small entities to 

a greater extent than large entities. The 

construction requirements and policies 

being revised will apply equally to all 

applicants, regardless of size of the 

applicant organization. Further, these 

changes will give all applicants greater 

flexibility in developing projects. 

Therefore, a regulatory flexibility 

analysis was not performed. 

Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA) Public Law 

104–4 establishes requirements for 

Federal agencies to assess the effects of 

their regulatory actions on State, local, 

and tribal governments and the private 

sector. Under section 202 of the UMRA, 

Rural Development must prepare, to the 

extent practicable, a written statement 

including a cost benefit analysis, for 

proposed and final rules with ‘‘Federal 

mandates’’ that may result in 

expenditures to State, local or tribal 

governments, in the aggregate, or to the 

private sector, of $100 million or more 

in any one year. With certain 

exceptions, section 205 of UMRA 

requires Rural Development to identify 

and consider a reasonable number of 

regulatory alternatives and adopt the 

least costly, most cost effective or least 

burdensome alternative that achieves 

the objectives of the rule. This proposed 

rule contains no Federal mandates for 

State, local, and tribal governments or 

the private sector. Thus, this rule is not 

subject to the requirements of sections 

202 and 205 of the Unfunded Mandates 

Reform Act of 1995. 

Environmental Impact Statement 

This document has been reviewed in 

accordance with 7 CFR part 1940, 

subpart G, ‘‘Environmental Program.’’ 

The Agency has determined that this 

action does not constitute a major 

Federal action significantly affecting the 

quality of the human environment, and, 

in accordance with the National 

Environmental Policy Act of 1969 

(NEPA), 42 U.S.C. 4321 et seq., an 

Environmental Impact Statement is not 

required. 

Programs Affected 

The programs affected are listed in the 

Catalog of Federal Domestic Assistance 

under Numbers 10.769 Rural Business 


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22632 Federal Register / Vol. 76, No. 78 / Friday, April 22, 2011 / Proposed Rules 

Enterprise Grants, 10.773 Rural 

Business Opportunity Grant, 10.766 

Community Facilities Loans and Grants, 

10.767 Intermediary Relending Program, 

and 10.854 Rural Economic 

Development Loan and Grant. 

Federalism 

The policies contained in this rule do 

not have any substantial direct effect on 

States, on the relationship between the 

National government and the States, or 

on the distribution of power and 

responsibilities among the various 

levels of government. Nor does this rule 

impose substantial direct compliance 

costs on State and local governments. 

Therefore, consultation with the States 

is not required. 

Intergovernmental Review 

The Agency conducts 

intergovernmental consultation in the 

manner delineated in RD Instruction 

1940–J, ‘‘Intergovernmental Review of 

Rural Development Programs and 

Activities,’’ and in 7 CFR part 3015, 

subpart V. The changes being 

considered are not subject to the 

provisions of Executive Order 12372, 

which requires intergovernmental 

consultation with State and local 

officials. An intergovernmental review 

for this revision is not required or 

applicable. 

Paperwork Reduction Act 

There are no new reporting and 

recordkeeping requirements associated 

with this rule. 

E-Government Act Compliance 

The Agency is committed to 

complying with the E-Government Act, 

to promote the use of the Internet and 

other information technologies to 

provide increased opportunities for 

citizen access to Government 

information and services, and for other 

purposes. For information pertinent to 

E-GOV compliance related to this 

proposed rule, please contact Larry 

Fleming, 202–720–8547. 

Background 

The proposed change will remove 

restrictive language in 7 CFR part 1942 

that limits projects using alternate 

construction methods to loans only, and 

will allow grant funds to be used with 

design/build and other alternate 

construction methods. When the 

regulation was written in the 1970’s 

design/build and construction 

management were unique forms of 

contracting that were not commonly 

used. It was determined that the Agency 

would not allow grant funds to be used 

for alternate construction methods. Over 

time, design/build and construction 

management became more common in 

the construction industry. The success 

or failure rate of such contracting 

methods has proven to be no greater 

than the traditional design/bid/build 

method. Therefore, the Agency has 

determined that the funding source— 

loans or grants—should have no 

determination on the construction 

method used. Further, these changes 

streamline processing by allowing 

contracts up to $250,000 to be reviewed 

by the State Office. The present 

regulation, which went into effect in the 

1970’s, requires all projects over 

$100,000 be reviewed by the National 

Office. Additional language is added to 

describe alternate construction methods: 

Design/build, construction management 

constructor, construction management 

advisor, and fast tracking. Presently, 

only a definition is given. The new 

language will help field staff and 

applicants understand when a project 

qualifies as an alternate construction 

method. None of the changes proposed 

are statutory requirements, and the 

Agency has determined that these 

changes better reflect current conditions 

within the construction industry, and 

will better streamline processing for 

applicants. 

This change revises the Agency Guide 

documents used with American 

Institute of Architects (AIA) contracts 

for construction to reflect their updated 

contracts. The AIA revises their contract 

documents every 10 years. Contracts 

referenced in the present regulation are 

replaced with the new updated 

contracts. New Guides are added for 

AIA contracts for design/build and 

construction management. Providing 

these Guides within the Agency 

regulation eliminates the need for 

National Office review of these projects, 

which reduces review time for the 

applicant. A new Guide is added listing 

the Agency requirements for review of 

alternate contract methods, to assist 

field staff and applicants. 

List of Subjects in 7 CFR Part 1942 

Community development, 

Community facilities, Loan programs— 

Housing and community development, 

Loan security, Rural areas. 

For the reasons set forth in the 

preamble, Chapter XVIII, Title 7 of the 

Code of Federal Regulations is amended 

as follows: 

PART 1942—ASSOCIATIONS 

1. The authority citation for part 1942 

continues to read as follows: 

Authority: 7 U.S.C. 1926; 7 U.S.C. 1927, 7 

U.S.C. 7901, and Pub. L. 110–246. 

Subpart A—Community Facility Loans 

2. Section 1942.9 is amended by 

revising paragraph (b) introductory text 

and (b)(1) to read as follows: 

§ 1942.9 Planning, bidding, contracting, 

and constructing. 

* * * * * 

(b) Contract approval. The State 

Director or designee is responsible for 

approving all construction contracts 

using legal advice and guidance of OGC 

as necessary. The use of a contracting 

method under § 1942.18(1) of this 

subpart exceeding $250,000 must be 

concurred by the National Office. When 

an applicant requests such concurrence, 

the State Director will submit the 

following to the National Office. 

(1) State Director’s and Rural 

Development engineer/architect’s 

comments and recommendations, and if 

noncompetitive negotiation per 

1942.18(k)(4) is accepted by the Agency, 

submit an evaluation of previous work 

of the proposed construction firm. 

* * * * * 

3. Section 1942.18, paragraph (l) is 

amended to read as follows: 

§ 1942.18 Community facilities—Planning, 

bidding, contracting constructing. 

* * * * * 

(l) Alternate contracting methods. The 

services of the consulting engineer or 

architect and the general construction 

contractor shall normally be procured 

from unrelated sources in accordance 

with paragraph (j)(7) of this section. 

Alternate contracting methods which 

combine or rearrange design, inspection 

or construction services (such as design/ 

build or construction management/ 

constructor) may be used with Rural 

Development written approval. 

(1) The owner will request Rural 

Development approval by providing the 

following information to the State Office 

for review and approval by the State 

Architect: 

(i) The owner’s written request to use 

an unconventional contracting method 

with a description of the proposed 

method. 

(ii) A proposed scope of work 

describing in clear, concise terms the 

technical requirements for the contract. 

This would include a nontechnical 

statement summarizing the work to be 

performed by the contractor and the 

results expected. Also include the 

sequence in which the work is to be 

performed and a proposed construction 

schedule. 

(iii) A proposed firm-fixed-price 

contract for the entire project which 

provides that the contractor shall be 

responsible for any extra cost which 


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Federal Register / Vol. 76, No. 78 / Friday, April 22, 2011 / Proposed Rules 22633 

may result from errors or omissions in 

the services provided under the contract 

and compliance with all Federal, State, 

and local requirements effective on the 

contract execution date. 

(iv) An evaluation of the contractor’s 

performance on previous similar 

projects in which the contractor acted in 

a similar capacity. 

(v) A detailed listing and cost estimate 

of equipment and supplies not included 

in the construction contract but which 

are necessary to properly operate the 

facility. 

(vi) Evidence that a qualified 

construction inspector who is 

independent of the contractor has or 

will be hired. 

(vii) Preliminary plans and outline 

specifications. However, final plans and 

specifications must be completed and 

reviewed by Rural Development prior to 

the start of construction. 

(viii) The owner’s attorney’s opinion 

and comments regarding the legal 

adequacy of the proposed contract 

documents and evidence that the owner 

has the legal authority to enter into and 

fulfill the contract. 

(2) The State Office may approve 

design/build or construction 

management/constructor projects if the 

contract amount is equal to or less than 

$250,000. 

(3) If the contract amount exceeds 

$250,000, National Office prior 

concurrence must be obtained in 

accordance with § 1942.9(b) of this 

subpart. Only that information required 

under § 1942.9(b) of this subpart must 

be provided to National Office Program 

Support Staff for review. Additional 

information, such as plans and 

specifications, may be submitted by the 

State Office, if a review of those items 

is desired. 

(4) The design/build method of 

construction is one in which the 

architectural and engineering services, 

normally provided by an independent 

consultant to the owner, are combined 

with those of the General Contractor 

under a single source contract. These 

services are commonly provided by a 

design/build firm, a joint venture 

between an architectural firm and a 

construction firm, or a company 

providing pre-engineered buildings and 

design services. 

(5) The Construction Management/ 

constructor (CMc), acts in the capacity 

of a General Contractor and is actually 

responsible for the construction. This 

type of construction management is also 

referred to as Construction Manager ‘‘At 

Risk’’. The construction contract is 

between the owner and the CMc. The 

CMc, in turn, may subcontract for some 

or all of the work. 

(6) The National Office may approve 

other alternative contact methods, such 

as Construction Management/advisor 

(CMa), with a recommendation from the 

State Office. The recommendation shall 

indicate the circumstances which prove 

this method advantageous to the 

applicant and the government. A CMa 

acts in an advisory capacity to the 

owner, and the actual contract for 

construction is between the owner and 

a prime contractor or multiple prime 

contractors. When a contract for an 

architect and a CMa are being provided, 

care must be taken to assure that 

separate professionals are not being paid 

to provide similar services. Further, 

paragraph (e)(3) of this section 

discourages separate contracts for 

construction. 

(7) All alternate contracting method 

projects must comply with the 

requirements for ‘‘maximum open and 

free competition’’ in paragraph (j)(2) of 

this section. Choosing an alternate 

contracting method is not a way to 

avoid competition. Further information 

on procurement methods, which must 

be followed, is provided in paragraph 

(k) of this section. 

* * * * * 

Dated: April 1, 2011. 

Dallas Tonsager, 

Under Secretary, Rural Development. 

Dated: April 11, 2011. 

Michael Scuse, 

Acting Under Secretary, Farm and Foreign 

Agricultural Services. 

[FR Doc. 2011–9630 Filed 4–21–11; 8:45 am] 

BILLING CODE 3410–XV–P 

DEPARTMENT OF THE TREASURY 

Office of the Comptroller of the 

Currency 

12 CFR Part 48 

[Docket ID OCC–2011–0007] 

RIN 1557–AD42 

Retail Foreign Exchange Transactions 

AGENCY: Office of the Comptroller of the 

Currency, Department of the Treasury. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: The Office of the Comptroller 

of the Currency (OCC) is proposing a 

rule authorizing national banks, Federal 

branches or agencies of foreign banks, 

and their operating subsidiaries to 

engage in off-exchange transactions in 

foreign currency with retail customers. 

The proposed rule also describes 

various requirements with which 

national banks, Federal branches or 

agencies of foreign banks, and their 

operating subsidiaries must comply to 

conduct such transactions. 

DATES: Comments on this notice of 

proposed rulemaking must be received 

by May 23, 2011. 

ADDRESSES: Because paper mail in the 

Washington, DC, area is subject to delay, 

commenters are encouraged to submit 

comments by the Federal eRulemaking 

Portal or e-mail. Please use the title 

‘‘Retail Foreign Exchange Transactions’’ 

to facilitate the organization and 

distribution of the comments. You may 

submit comments by any of the 

following methods: 

• Federal eRulemaking Portal— 

‘‘regulations.gov’’: Go to http:// 

www.regulations.gov. Select ‘‘Document 

Type’’ of ‘‘Proposed Rules,’’ and in 

‘‘Enter Keyword or ID Box,’’ enter Docket 

ID ‘‘OCC–2011–0007,’’ and click 

‘‘Search.’’ On ‘‘View By Relevance’’ tab at 

bottom of screen, in the ‘‘Agency’’ 

column, locate the proposed rule for the 

OCC, in the ‘‘Action’’ column, click on 

‘‘Submit a Comment’’ or ‘‘Open Docket 

Folder’’ to submit or view public 

comments and to view supporting and 

related materials for this rulemaking 

action. 

Click on the ‘‘Help’’ tab on the 

Regulations.gov home page to get 

information on using Regulations.gov, 

including instructions for submitting or 

viewing public comments, viewing 

other supporting and related materials, 

and viewing the docket after the close 

of the comment period. 

• E-mail: 

regs.comments@occ.treas.gov. 

• Mail: Office of the Comptroller of 

the Currency, 250 E Street, SW., Mail 

Stop 2–3, Washington, DC 20219. 

• Fax: (202) 874–5274. 

• Hand Delivery/Courier: 250 E 

Street, SW., Mail Stop 2–3, Washington, 

DC 20219. 

Instructions: You must include ‘‘OCC’’ 

as the agency name and ‘‘Docket ID 

OCC–2011–0007’’ in your comment. In 

general, the OCC will enter all 

comments received into the docket and 

publish them on the Regulations.gov 

Web site without change, including any 

business or personal information that 

you provide such as name and address 

information, e-mail addresses, or phone 

numbers. Comments received, including 

attachments and other supporting 

materials, are part of the public record 

and subject to public disclosure. Do not 

enclose any information in your 

comment or supporting materials that 

you consider confidential or 

inappropriate for public disclosure. 

You may review comments and other 

related materials that pertain to this 


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