68784 Federal Register / Vol. 69, No. 227 / Friday, November 26, 2004 / Rules and Regulations 

§ 558.355 Monensin.

* * * * *

(d) * * *

(7) * * *

(vi) A withdrawal time has not been 

established for preruminating calves. Do 

not use in calves to be processed for 

veal.

* * * * *

(13) The labeling of Type B and Type 

C (liquid and dry) medicated feeds 

intended for use in dairy cows shall 

bear the following caution statements: 

You may notice: Reduced voluntary 

feed intake in dairy cows fed monensin. 

This reduction increases with higher 

doses of monensin fed. Rule out 

monensin as the cause of reduced feed 

intake before attributing to other causes 

such as illness, feed management, or the 

environment. Reduced milk fat 

percentage in dairy cows fed monensin. 

This reduction increases with higher 

doses of monensin fed. Increased 

incidence of cystic ovaries and metritis 

in dairy cows fed monensin. Reduced 

conception rates, increased services per 

animal, and extended days open and 

corresponding calving intervals in dairy 

cows fed monensin.

* * * * *

(f) * * *

(3) * * *

(xiii) Amount per ton. Monensin, 11 

to 22 grams.

(A) Indications for use. For increased 

milk production efficiency (production 

of marketable solids-corrected milk per 

unit of feed intake) in dairy cows.

(B) Limitations. Feed continuously to 

dry and lactating dairy cows in a total 

mixed ration (‘‘complete feed’’). See 

paragraphs (d)(2), (d)(5), (d)(6), (d)(7)(i), 

(d)(7)(ii), (d)(7)(iii), (d)(7)(vi), (d)(8), and 

(d)(12) of this section.

* * * * *

Dated: November 10, 2004.

Steven D. Vaughn,

Director, Office of New Animal Drug 

Evaluation, Center for Veterinary Medicine.

[FR Doc. 04–26091 Filed 11–24–04; 8:45 am]

BILLING CODE 4160–01–S

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

24 CFR Part 203

[Docket No. FR–4835–F–03] 

RIN 2502–AI00

FHA TOTAL Mortgage Scorecard

AGENCY: Office of the Assistant 

Secretary for Housing–Federal Housing 

Commissioner, HUD.

ACTION: Final rule.

SUMMARY: On November 21, 2003, HUD 

published an interim rule to codify the 

procedures that mortgagees and 

automated underwriting system vendors 

must follow if they opt to use the 

‘‘Technology Open to Approved 

Lenders’’ (TOTAL) Mortgage Scorecard 

offered by the Federal Housing 

Administration (FHA). The interim rule 

did not alter the underwriting 

requirements applicable to FHA 

mortgagees. Rather, the interim rule 

defined the acronym TOTAL and 

provided the requirements and 

procedures for use of the TOTAL 

Mortgage Scorecard. This final rule 

follows publication of the November 21, 

2003, interim rule. HUD did not receive 

any public comments on the interim 

rule. Accordingly, HUD is adopting the 

interim rule, as corrected by a technical 

correction published on January 2, 2004, 

without change.

DATES: Effective date: December 27, 

2004.

FOR FURTHER INFORMATION CONTACT:

Vance T. Morris, Director, Office of 

Single Family Program Development, 

Room 9278, Department of Housing and 

Urban Development, 451 Seventh Street, 

SW., Washington, DC 20410–8000; 

telephone (202) 708–2121. (This is not 

a toll-free number.) Hearing- or speechimpaired persons may access this 

number by calling the toll-free Federal 

Information Relay Service number at 1–

800–877–8339.

SUPPLEMENTARY INFORMATION: 

I. Background—HUD’s November 21, 

2003, Interim Rule 

On November 21, 2003 (68 FR 65824), 

HUD published an interim rule 

codifying the procedures that 

mortgagees and automated underwriting 

system vendors must follow if they opt 

to use the ‘‘Technology Open to 

Approved Lenders’’ (TOTAL) Mortgage 

Scorecard offered by the Federal 

Housing Administration (FHA). The 

TOTAL Mortgage Scorecard (or 

Scorecard) developed by HUD assesses 

the credit worthiness of FHA mortgagors 

by evaluating certain mortgage 

application and mortgagor credit 

information that has been statistically 

proven to accurately predict the 

likelihood of mortgagor default. The 

TOTAL Mortgage Scorecard is not an 

automated underwriting system (AUS); 

rather, it is a mathematical equation 

intended for use within an AUS. 

The November 21, 2003, interim rule 

followed a December 6, 2000 (65 FR 

76273) Federal Register notice 

announcing HUD’s intention to deploy 

the FHA TOTAL Mortgage Scorecard. 

The objectives for use of the TOTAL 

Mortgage Scorecard, which were first 

stated in the Notice are (1) to provide an 

improved credit evaluation system for 

FHA loans that has been statistically 

proven to accurately predict the 

likelihood of mortgagor default while 

providing a uniform system protective 

of borrowers; (2) to expand access to 

mortgage credit for low- and moderateincome mortgagors and discourage 

unlawful discrimination against 

mortgagors protected by the Fair 

Housing Act and the Equal Credit 

Opportunity Act; (3) to facilitate access 

to, and reduce the cost and time 

associated with, originating HUD/FHAinsured mortgages; and (4) to encourage 

a standardized, industry-wide capability 

for communication and exchange of 

information among members of the 

mortgage lending community. 

The December 6, 2000, Notice also 

advised that after deployment of the 

TOTAL Mortgage Scorecard, HUD 

would require use of the Scorecard in 

any AUS. The Notice also indicated that 

users of the TOTAL Mortgage Scorecard 

would receive documentation relief and 

credit policy waivers provided by HUD. 

Further, the Notice advised that HUD 

also had developed a Use Agreement 

that established the requirements and 

responsibilities for implementation and 

use of the TOTAL Mortgage Scorecard 

by qualified mortgagees and others that 

purchase, sell, underwrite, or document 

HUD mortgage loans for mortgagees 

under HUD’s Direct Endorsement 

program. 

While HUD could have continued, 

through individual approvals, to 

authorize organizations to use the 

TOTAL Mortgage Scorecard, HUD 

decided that a more efficient course of 

action would be to promulgate 

regulations for the use of the Scorecard 

consistent with the purpose and 

objectives described above instead of 

executing individual approvals that 

establish the requirements and 

responsibilities for use of the Scorecard. 

Accordingly, HUD issued the November 

21, 2003, interim rule.

The interim rule revised HUD’s 

regulation at 24 CFR 203.251 to define 

the acronym ‘‘TOTAL’’ and revised 

§ 203.255 to establish specific 

requirements that mortgagees and 

vendors must abide by when using the 

TOTAL Mortgage Scorecard. The 

interim rule described the Scorecard 

requirements in order to assist the 

mortgagee in expediting the 

endorsement process. While the 

Scorecard is a valuable tool, its value 

depends on approved lenders properly 

using the Scorecard in accordance with 

HUD requirements and procedures. The 

preamble to the November 21, 2003, 

Federal Register / Vol. 69, No. 227 / Friday, November 26, 2004 / Rules and Regulations 68785

interim rule provides additional details 

regarding the regulatory amendments to 

24 CFR part 203. 

A technical correction to the interim 

rule was published on January 2, 2004 

(69 FR 4). The January 2, 2004, 

document corrected the interim rule by 

changing certain references to 

‘‘mortgage’’ to read ‘‘mortgagee.’’ The 

January 2, 2004 document also made a 

technical correction to 

§ 203.255(b)(5)(i)(A) of the interim rule, 

which contained an outdated reference 

to ‘‘approved’’ AUSs. As noted in the 

preamble to the November 23, 2003, 

interim rule, HUD is no longer 

approving individual AUSs, and the few 

approvals that existed at the time of 

publication of the interim rule have 

since been terminated. Accordingly, the 

January 2, 2004, document corrected 

§ 203.255(b)(5)(i)(A) by removing the 

reference to ‘‘approved’’ AUSs. 

II. This Final Rule 

This final rule follows publication of 

the November 21, 2003, interim rule. 

The interim rule became effective 

December 22, 2003, and provided for a 

60-day public comment period. The 

comment period for the interim rule 

closed on January 20, 2004. HUD did 

not receive any public comments on the 

interim rule. Accordingly, HUD is 

adopting the interim rule, as corrected 

by the technical correction published on 

January 2, 2004, without change. 

Any AUS vendor that ‘‘calls’’ the 

Total Mortgage Scorecard, and any 

FHA-approved mortgagee that obtains a 

risk-assessment from the Scorecard, 

must abide by the requirements 

contained in this final rule. Only AUSs 

developed, operated, owned, or used by 

FHA-approved Direct Endorsement 

mortgagees, Fannie Mae, or Freddie Mac 

are permitted to access the Scorecard, 

and only FHA-approved mortgagees are 

able to obtain risk assessments using the 

TOTAL Mortgage Scorecard. 

As did the preceding interim rule, this 

final rule affirms that Direct 

Endorsement Mortgagees remain solely 

responsible for the underwriting 

decision. This rule does not alter the 

underwriting requirements to which 

FHA mortgagees must currently adhere. 

Rather, this final rule addresses the use 

of the TOTAL Mortgage Scorecard and 

the requirements and procedures to 

which FHA mortgagees must adhere if 

they opt to use the Scorecard. AUS 

vendors and mortgagees found to violate 

these conditions may have their access 

to the Scorecard terminated with 

appropriate notice. As an additional 

measure to ensure compliance with 

these requirements, access to the 

TOTAL Mortgage Scorecard by a FHA 

mortgagee will be conditioned upon the 

mortgagee’s certification to comply with 

the requirements as provided in this 

rule. 

The TOTAL Mortgage Scorecard is 

only a tool to assist the mortgagee in 

managing its workflow and expediting 

the endorsement process and is not a 

substitute for the mortgagee’s reasonable 

consideration of risk and credit 

worthiness. To help assure the TOTAL 

Mortgage Scorecard is not misused, the 

final rule requires mortgagees to provide 

full manual underwriting for mortgage 

applicants when the scorecard returns a 

‘‘refer’’ risk score. The Scorecard results 

must not be used as the basis for 

rejecting any mortgage applicant. 

III. Findings and Certifications 

Public Reporting Burden 

The information collection 

requirements contained in this final rule 

have been approved by the Office of 

Management and Budget (OMB) under 

the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501–3520) and assigned 

OMB Control Number 2502–0556. In 

accordance with the Paperwork 

Reduction Act, HUD may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless the collection displays a 

currently valid OMB control number. 

Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA) 

(5 U.S.C. 601 et seq.), generally requires 

an agency to conduct a regulatory 

flexibility analysis of any rule subject to 

notice and comment rulemaking 

requirements unless the agency certifies 

that the rule will not have a significant 

economic impact on a substantial 

number of small entities. The final rule 

governs access to, and use of, an 

automated, electronic tool to assist 

mortgagees in managing workflow and 

expediting the endorsement process. 

There are no anti-competitive 

discriminatory aspects of the rule with 

regard to small entities, and there are 

not any unusual procedures that would 

need to be complied with by small 

entities. Accordingly, the undersigned 

certifies that this rule will not have a 

significant economic impact on a 

substantial number of small entities. 

Environmental Impact 

A Finding of No Significant Impact 

with respect to the environment was 

made at the interim rule stage in 

accordance with HUD regulations at 24 

CFR part 50, which implements section 

102(2)(C) of the National Environmental 

Policy Act of 1969 (42 U.S.C. 4332). The 

Finding of No Significant Impact is 

available for public inspection between 

the hours of 7:30 a.m. and 5:30 p.m. 

weekdays in the Regulations Division, 

Office of General Counsel, Room 10276, 

Department of Housing and Urban 

Development, 451 Seventh Street, SW., 

Washington, DC 20410–0500. 

Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA) (2 U.S.C. 

1531–1538) establishes requirements for 

Federal agencies to assess the effects of 

their regulatory actions on State, local, 

and tribal governments and the private 

sector. This final rule does not impose 

any Federal mandates on any State, 

local, or tribal governments or the 

private sector within the meaning of the 

UMRA. 

Executive Order 13132, Federalism 

Executive Order 13132, (entitled 

‘‘Federalism’’) prohibits, to the extent 

practicable and permitted by law, an 

agency from promulgating a regulation 

that has federalism implications and 

either imposes substantial direct 

compliance costs on State and local 

governments and is not required by 

statute, or preempts State law, unless 

the relevant requirements of section 6 of 

the Executive Order are met. This rule 

does not have federalism implications 

and does not impose substantial direct 

compliance costs on State and local 

governments or preempt State law 

within the meaning of the Executive 

Order. 

Executive Order 12866, Regulatory 

Planning and Review 

The Office of Management and Budget 

(OMB) reviewed this rule under 

Executive Order 12866 (entitled 

‘‘Regulatory Planning and Review’’). 

OMB determined that this rule is a 

‘‘significant regulatory action,’’ as 

defined in section 3(f) of the Order 

(although not economically significant, 

as provided in section 3(f)(1) of the 

Order). Any changes made to the 

interim rule subsequent to its 

submission to OMB are identified in the 

docket file, which is available for public 

inspection in the Regulations Division, 

Office of the General Counsel, Room 

10276, Department of Housing and 

Urban Development, 451 Seventh Street, 

SW., Washington, DC 20410–0500. 

Catalog of Federal Domestic Assistance 

The Catalog of Federal Domestic 

Assistance Numbers for 24 CFR part 203 

are 14.117 and 14.133.

List of Subjects in 24 CFR Part 203

Hawaiian Natives, Home 

improvement, Indians—lands, Loan 

68786 Federal Register / Vol. 69, No. 227 / Friday, November 26, 2004 / Rules and Regulations 

programs—housing and community 

development, Mortgage insurance, 

Reporting and recordkeeping 

requirements, Solar energy.

■ Accordingly, for the reasons stated in 

the preamble, the interim rule for part 

203 of subpart B of Title 24 of the Code 

of Federal Regulations, published on 

November 21, 2003, at 68 FR 65824, as 

corrected on January 2, 2004, at 69 FR 4, 

is promulgated as final, without change.

Dated: November 19, 2004. 

John C. Weicher, 

Assistant Secretary for Housing—Federal 

Housing Commissioner.

[FR Doc. 04–26113 Filed 11–24–04; 8:45 am] 

BILLING CODE 4210–27–P

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

24 CFR Part 960 and 966

[Docket No. FR–4824–F–02] 

RIN 2577–AC42

PHA Discretion in Treatment of OverIncome Families

AGENCY: Office of the Assistant 

Secretary for Public and Indian 

Housing, HUD.

ACTION: Final rule.

SUMMARY: This final rule gives public 

housing agencies (PHAs) the discretion, 

in accordance with federal law and 

regulations, to establish occupancy 

policies that include the eviction of 

public housing tenants who are over the 

income limit for eligibility to participate 

in public housing programs. PHAs may 

decide that such families should be able 

to find other housing and that public 

housing units should be made available 

for eligible low-income families with 

greater housing need. This final rule 

takes into consideration the public 

comments received on the proposed 

rule. After careful review of the 

comments, HUD has decided to adopt 

the proposed rule with minor revision.

DATES: Effective Date: December 27, 

2004.

FOR FURTHER INFORMATION CONTACT:

Patricia Arnaudo, Director, Public 

Housing Occupancy and Management 

Division, Office of Public and Indian 

Housing, Department of Housing and 

Urban Development, Room 4116, 451 

Seventh Street, SW., Washington, DC 

20410–5000 telephone (202) 708–0744 

(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 Information 

Relay Service at 800–877–8339.

SUPPLEMENTARY INFORMATION: 

I. Background 

On August 1, 2003 (68 FR 45734), 

HUD published a notice of proposed 

rulemaking (NPRM) that proposed to 

grant PHAs the discretion to evict a 

family that is over the eligible income 

limit, with exceptions for families 

entitled to EID (addressed at 42 U.S.C. 

1437a(d)) or with valid contracts of 

participation under the Family Self 

Sufficiency (FSS) program (42 U.S.C. 

1437u). In submitting this proposed rule 

for public comment, HUD stated its 

view that public housing should be 

available to eligible low-income families 

and that it is inappropriate to limit the 

ability of a PHA to move over-income 

families out of public housing to make 

room for low-income families on 

waiting lists. 

The current rule on eviction at 24 CFR 

960.261 limits the ability of PHAs to 

evict over-income families unless (1) the 

PHA has determined that there is other 

decent, safe, and sanitary housing 

available to the tenant at a rent not 

exceeding the then-current tenant rent, 

or (2) the PHA is required to evict the 

family by local law. 

This final rule does not require PHAs 

to evict over-income residents, but 

rather gives PHAs the discretion to do 

so and thereby make units available for 

applicants who are income-eligible. 

II. This Final Rule 

This final rule follows publication of 

the August 1, 2003, proposed rule. The 

public comment period for the proposed 

rule closed on September 30, 2003. 

Sixteen public comments were received 

from a variety of individuals and groups 

during the comment period. 

Commenters included tenant 

organizations, housing authority trade 

associations, public housing tenants, 

and PHAs. Three of the public 

comments were in the form of petitions 

signed by multiple public housing 

residents from one city, and gathered 

and submitted by a single organization. 

After consideration of these comments, 

HUD has decided to adopt a final rule 

that, like the proposed rule, provides an 

exception to eviction for over-income 

tenants who are receiving the earned 

income disallowance or have active 

contracts of participation in a family 

supportive services program. In 

addition, this rule makes a conforming 

technical change to 24 CFR 

966.4(l)(2)(ii). 

III. Discussion of Public Comments 

Comment: The rule properly grants 

discretion to the PHAs regarding overincome residents. One PHA commenter 

agreed with the rule so long as 

implementation is voluntary and ‘‘with 

no penalty for non-participation.’’

Similarly, another PHA did not oppose 

the concept of the proposed rule that 

will grant ‘‘public housing agencies ‘‘

the discretion to evict over income 

families from public housing, as long as 

this rule remains a PHA option.’’ ‘‘In an 

effort to increase accountability and 

ensure that public housing participants 

are not being evicted prematurely before 

reaching self-sufficiency,’’ this 

commenter would prefer PHAs be given 

discretion to regulate this policy, rather 

than being subject to a mandatory 

regulation. 

Observing that there may be widely 

divergent local strategies ranging from 

targeting only households most in need 

to retaining some over-income 

households as role models and to 

maintain the marketability of public 

housing, one commenter, also a PHA, 

agreed with the discretion the rule 

would grant to PHAs, and states that 

‘‘local communities deserve federal 

respect for the diverse implementation 

strategies they devise to accomplish 

broadly stated national policy goals.’’

Another commenter stated, ‘‘We 

appreciate and support the 

Department’s recognition of the 

importance of local-level discretion in 

setting housing policies’’ and ‘‘LHAs 

[local housing agencies] must retain true 

discretion to establish policies that suit 

their communities.’’ However, this 

commenter, a housing association, 

stated that ‘‘a more useful formulation 

of the notice would be one that gives 

PHAs the discretion to formulate local 

policies with regard to families who 

have increased their incomes while 

residing in public housing.’’ Another 

PHA stated that ‘‘ultimate discretion’’

on if, how and when it is applied 

should be left to the individual PHA. 

Local PHAs should be allowed to set the 

over-income ‘‘target’’ for triggering the 

eviction based on local market 

conditions.’’

Response: HUD agrees with these 

commenters in their desire for PHAs to 

act with discretion. This rule gives 

PHAs the discretion to make decisions 

concerning their local housing market 

needs. HUD will not penalize PHAs for 

not incorporating this rule into their 

admission and continued occupancy 

policies.

Comment: The rule would have a 

negative effect on deconcentration of 

poverty and income-mixing goals.

Several commenters specifically 

commented on the rule’s effect on 

income-mixing and deconcentration of 

poverty. One PHA stated that having a 

range of incomes is preferable to having