```

[Federal Register Volume 89, Number 245 (Friday, December 20, 2024)]
[Rules and Regulations]
[Pages 104031-104040]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-30330]

========================================================================
Rules and Regulations
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains regulatory documents 
having general applicability and legal effect, most of which are keyed 
to and codified in the Code of Federal Regulations, which is published 
under 50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by the Superintendent of Documents. 

========================================================================


Federal Register / Vol. 89, No. 245 / Friday, December 20, 2024 / 
Rules and Regulations

[[Page 104031]]

DEPARTMENT OF AGRICULTURE

Rural Housing Service

7 CFR Part 3565

[Docket No. RHS-24-MFH-0043]

Loan Guarantees Under the Section 538 Guaranteed Rural Rental 
Housing Program

AGENCY: Rural Housing Service, Department of Agriculture (USDA).

ACTION: Notification of updates in the competitive lender submissions 
process.

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

SUMMARY: The Rural Housing Service (RHS or Agency), an agency within 
Rural Development (RD), announces updates in the process for 
competitive lender application submissions regarding proposed 
properties for the Section 538 Guaranteed Rural Rental Housing Program 
(GRRHP). The amount of program dollars available for the GRRHP will be 
determined by the Appropriations Act for each fiscal year.

DATES: The effective date of the process updates is December 20, 2024.

ADDRESSES: Applications must be submitted electronically in accordance 
with the instructions in section IV of this notification. Applications 
will be accepted on a continuous basis. Complete applications that are 
deemed eligible for further processing will be funded to the extent an 
Appropriations Act provides sufficient funding in the fiscal year the 
application is selected. If funding is not sufficient in any given 
fiscal year, funding will be provided under the next funding 
Appropriations Act, subject to the availability of funds. Approved 
applications are subject to the fee structure in effect when the 
application is received by the Agency.

FOR FURTHER INFORMATION CONTACT: Jonathan Bell, Director, Processing 
and Report Review Branches, Production and Preservation Division, 
Multifamily Housing Programs, Rural Development, United States 
Department of Agriculture, via email: [email protected] or 
telephone: 202-205-9217. Hearing or speech-impaired persons may access 
that number by calling the 711 Federal Information Relay Service.

SUPPLEMENTARY INFORMATION:

Authority

    The GRRHP is authorized under section 538 of the Housing Act of 
1949, as amended, 42 U.S.C. 1490p-2, and implemented under 7 CFR part 
3565.

Background

    RHS is committed to helping improve the economy and quality of life 
in rural areas by offering a variety of programs. The Agency offers 
loans, grants, and loan guarantees to help create jobs, expand economic 
development, and provide critical infrastructure investments. RHS also 
provides technical assistance loans and grants by partnering with 
agricultural producers, cooperatives, Indian tribes, non-profits, and 
other local, state, and Federal agencies.
    The Section 538 GRRHP is a program administered by the RHS, under 
the authority of the Housing Act of 1949, as amended (42 U.S.C. 1490p-
2). The purpose of the GRRHP is to increase the supply of affordable 
rural rental housing, using loan guarantees that encourage partnerships 
between the RHS, private lenders, and public agencies.
    On April 28, 2023 (88 FR 26221), the Agency published a 
notification in the Federal Register to consolidate all changes to the 
Section 538 GRRHP program. Pursuant to 7 CFR part 3565, any changes to 
the selection and/or scoring criteria or fees charged in subsequent 
years will be announced in a notification published in the Federal 
Register. Accordingly, this notification replaces the notification 
published on April 28, 2023 (88 FR 26221), and the correction 
notification published on July 17, 2023 (88 FR 46047), as the reference 
for interested parties to follow when submitting GRRHP applications.
    Expenses incurred in developing applications will be at the 
applicant's risk. The following paragraphs outline the eligibility 
requirements, lender responsibilities, and the overall application 
processes.
    Any future modifications to this notification, including changes to 
the selection and/or scoring criteria or fees charged in subsequent 
years, will be published in the Federal Register.

Discussion of Program Updates

    The Agency announces the following updates to the GRRHP:
    1. The Agency added a new priority scoring criteria related to 
maturing mortgages in section 514/515 and section 538 joint 
transactions.
    2. The Agency adjusted the priority scoring criteria points.
    3. The Agency added a new priority scoring criteria related to 
waiving the Qualified Contract rights on applications that are funded 
using Low Income Housing Tax Credits.
    4. The Section 538 GRRHP Response Form will now be titled and 
referred to as the Section 538 GRRHP Response Template. The Section 538 
GRRHP Response Template is not required; however, the Agency encourages 
applicants to utilize and submit the template along with their complete 
application to streamline the review process. The template is available 
on the Agency's Multifamily Housing Loan Guarantees website (https://www.rd.usda.gov/programs-services/multifamily-housing-programs/multifamily-housing-loan-guarantees) for applicants that choose to 
utilize it. If the applicant chooses not to use the template, the 
information is still required to be submitted with the completed 
application.
    5. The Agency is requiring lenders to include the proposed closing 
date in their application submission.
    6. The Agency is requiring lenders to provide information regarding 
commercial space associated with the property.
    7. The Agency is requiring lenders to identify each principal 
involved in the Section 538 GRRHP transaction in their application 
submission.
    8. The Agency has modified the instructions for initiating the 
application process.

I. Funding Opportunity Description

    The GRRHP program is administered subject to appropriations by the 
United States Department of Agriculture (USDA) as authorized under 
section 538 of the Housing Act of 1949, as amended, 42 U.S.C. 1490p-2, 
and is implemented under 7 CFR part 3565. The Section 538 GRRH program 
will continue to follow procedures similar to other RD

[[Page 104032]]

guaranteed loan programs and accept applications on a continuous basis.
    The purpose of the GRRHP is to increase the supply of affordable 
rural rental housing using loan guarantees to encourage partnerships 
between the Agency, private lenders, and public agencies.
    Eligibility of Prior Fiscal Year Applications: Prior fiscal year 
complete applications that were submitted to the Agency but not funded 
due to lack of available funding will be eligible for review under the 
current notice without having to submit a new application.
    If approved, applications submitted under a previous fiscal year 
notice will be obligated in the order that the request for obligation 
was received, to the extent of available funding.
    Once the outstanding prior years approved applications have been 
funded, the Agency will fund applications approved in the current 
fiscal year in the order by which the request for obligation was 
received. If funding is insufficient to serve all applications approved 
in the current fiscal year, they will be funded according to the 
priority scoring set forth in section V of this notification.
    The obligation of program funds is discussed further in section VI 
of this notification.

II. Award Information

    Anyone interested in submitting an application for funding under 
this program is encouraged to visit the RD website (https://www.rd.usda.gov/programs-services/multifamily-housing-programs/multifamily-housing-loan-guarantees) periodically for updated 
information regarding the status of funding authorized for this 
program.
    (1) Qualifying Properties: Qualifying properties include new 
construction for multifamily housing units and the acquisition of 
existing structures with a minimum per unit rehabilitation expenditure 
requirement in accordance with 7 CFR 3565.252. This may include the 
revitalization, repair, and transfer (as stipulated in 7 CFR 3560.406) 
of existing Section 515 Rural Rental Housing (RRH) and existing Section 
514/516 Farm Labor Housing (FLH). The Agency does not finance 
acquisition only deals.
    Transfer costs are subject to Agency approval. All costs must be an 
eligible use of loan proceeds as listed in 7 CFR 3565.205. Properties 
involved in the Agency's Multifamily Preservation and Revitalization 
(MPR) Demonstration are subject to an equity payment, as stipulated in 
7 CFR 3560.406(e). In accordance with 7 CFR 3565.252, the property must 
have a need for repairs of at least $6,500 per dwelling unit and must 
undergo revitalization.
    If the transaction includes a transfer of ownership and assumption 
of loan for a Section 515 RRH property, the complete 538 application 
and the complete Section 515 RRH transfer of ownership application must 
be submitted simultaneously, same day, to the Agency. If the complete 
538 application is not submitted simultaneously with the Section 515 
RRH transfer of ownership application, the 538 application will be 
rejected and returned to the lender. The lender may resubmit the 
application when both the complete 538 application and the 515 RRH 
transfer of ownership application can be submitted simultaneously.
    (2) Eligible Financing Sources: Any form of Federal, State, and 
conventional sources of financing can be used in conjunction with the 
loan guarantee, including HOME Investment Partnerships Program (HOME) 
grant funds, tax exempt bonds, and Low-Income Housing Tax Credits 
(LIHTC).
    (3) Types of Guarantees: The Agency offers three types of 
guarantees, which are set forth at 7 CFR 3565.52(c). The Agency 
liability under any guarantee will decrease or increase, in proportion 
to any decrease or increase in the amount of the unpaid portion of the 
loan, up to the maximum amount specified in the Loan Note Guarantee. 
Penalties incurred as a result of default are not covered by any of the 
program's guarantees. The Agency may provide a lesser guarantee based 
upon its evaluation of the credit quality of the loan.
    (4) Interest Credit: There will be no interest credit.
    (5) Program Fees: The following fees have been determined necessary 
to cover the projected cost of loan guarantees. These fees may be 
adjusted based on the Appropriation requirements and in future years to 
cover the projected costs of loan guarantees in those future years, or 
additional fees may be charged. Any changes to the program fees will be 
announced in a notification published in the Federal Register. The fees 
are as follows:
    (a) Initial guarantee fee. The Agency will charge an initial 
guarantee fee pursuant to 7 CFR 3565.53(a). For purposes of calculating 
this fee, the guarantee amount is the product of the percentage of the 
guarantee times the initial principal amount of the guaranteed loan.
    (b) Annual guarantee fee. An annual guarantee fee based on the 
outstanding principal amount of the loan as of December 31 will be 
charged each year or portion of a year that the guarantee is 
outstanding, pursuant to 7 CFR 3565.53(b). The guarantee fee is paid in 
advance.
    (c) As permitted under 7 CFR 3565.302(b)(5), there is a non-
refundable service fee of $1,500 for the review of a lender's first 
request to extend the term of a guarantee commitment beyond its 
original expiration (the request must be received by the Agency prior 
to the commitment's expiration). For any subsequent extension request 
on the same guarantee, the fee will be $2,500.
    (d) As permitted under 7 CFR 3565.302(b)(5), there is a non-
refundable service fee of $3,500 for the review of a lender's first 
request to reopen an application when a commitment has expired. For any 
subsequent request to reopen the same application after the commitment 
has expired, the fee will be $3,500.
    (e) As permitted under 7 CFR 3565.302(b)(4), there is a non-
refundable service fee of $1,500 in connection with a lender's request 
to approve the transfer of property or a change in composition of the 
ownership entity.
    (f) There is no application fee.
    (g) There is no lender application fee for lender approval.
    (h) There is no surcharge for the guarantee of construction 
advances.
    The current initial and annual guarantee fees can be found in a 
notice published in the Federal Register (87 FR 12077) on March 3, 
2022, at the following website: https://www.federalregister.gov/documents/2022/03/03/2022-04442/new-fee-structure-for-section-538-guaranteed-rural-rental-housing-program-initial-and-annual. If changes 
occur in the fee amounts, the Agency will release those changes through 
a notice in the Federal Register and will provide guidance on how to 
process the loans which will be impacted by the new fee structure.

III. Lender Eligibility Information

    (1) Eligible Lenders: An eligible lender for the Section 538 GRRHP 
as required by 7 CFR 3565.102 must be a licensed business entity or 
Housing Finance Agency (HFA) in good standing in the State or States 
where it conducts business. Lender eligibility requirements are 
contained in 7 CFR 3565.102. Please review that section for a complete 
list of all the criteria. The Agency will only consider applications 
from GRRHP eligible, or approved lenders as described in 7 CFR 3565.102 
and 3565.103, respectively.
    Lenders who do not have GRRHP approved lender status and whose 
applications are approved will be notified by the Agency to submit a

[[Page 104033]]

request for GRRHP lender approval within 30 days of notification. 
Alternately, lenders may submit a request for GRRHP approved lender 
status with their project application submission. Lenders who request 
GRRHP approval must meet the standards in 7 CFR 3565.103. The loan note 
guarantee will not be issued to lenders that have not been vetted and 
determined to be eligible by the Agency to participate in the GRRHP 
programs.
    Lenders that have received GRRHP lender approval that remain in 
good standing in accordance with 7 CFR 3565.105 do not need to reapply 
for GRRHP lender approval.
    (2) System for Award Management and Unique Entity Identifier:
    (a) At the time of application, each applicant must have an active 
registration in the System for Award Management (SAM) before submitting 
its application in accordance with 2 CFR part 25. To register in SAM, 
entities will be required to obtain a Unique Entity Identifier (UEI). 
Instructions for obtaining the UEI are available at https://sam.gov/content/entity-registration.
    (b) Applicants must maintain an active SAM registration, with 
current, accurate and complete information, at all times during which 
they have an active Federal award or an application under consideration 
by a Federal awarding agency.
    (c) Applicant must ensure they complete the Financial Assistance 
General Representations and Certifications in SAM.
    (d) Applicants must provide a valid UEI in its application, unless 
determined exempt under 2 CFR 25.110.
    (e) The Agency will not make an award until the applicant has 
complied with all SAM requirements including providing the UEI. If an 
applicant has not fully complied with the requirements by the time the 
Agency is ready to make an award, the Agency may determine that the 
applicant is not qualified to receive a Federal award and use that 
determination as a basis for making a Federal award to another 
applicant.
    Submission of Documentation for GRRHP Lender Approval:
    All lenders that have not yet received GRRHP lender approval must 
submit a complete lender application to: Multifamily Housing Asset 
Management Division, Branch Chief, Risk and Counterparty Oversight, 
[email protected]. Lender applications must be identified as 
``Lender Application--Section 538 Guaranteed Rural Rental Housing 
Program'' in the subject line.

IV. Application Submission Information

    Applications will be accepted on a continuous basis. Applications 
that are deemed eligible for further processing will be funded to the 
extent an Appropriations Act provides sufficient funding in the fiscal 
year the application is selected. If funding is not sufficient in any 
given fiscal year, funding will be provided under the next funding 
Appropriations Act, subject to the availability of funds. Approved 
applications are subject to the fee structure in effect when the 
application is received by the Agency.
    (1) To initiate the application process, the applicant must send an 
email of interest to the RHS Production and Preservation Division at 
[email protected]. The email message must contain the 
following information:
    a. Subject line: Section 538 GRRHP Application Submission
    b. Body of email: Borrower Name, Project Name, Borrower Contact 
Information (including address, phone number, email address to receive 
application submission information) and Project State.
    c. Request language: ``Please provide application submission 
instructions so that we may submit our Section 538 GRRHP application 
and supporting documents.''
    Application submission instructions will be emailed to all 
interested respondents supplying valid email addresses within two (2) 
business days from the date the email of interest is received by the 
Agency.
    (2) All applications require lender information and project 
specific data as set out in this notification. Complete applications 
must include a signed cover letter from the lender, on the lender's 
letterhead. The lender must provide the requested information as 
outlined in this notification concerning the property, to establish the 
purpose of the proposed property, its location, and how it meets the 
established priorities for funding.
    In compliance with Agency guidance to determine the lender's 
(participants) eligibility, the Agency is responsible for screening 
lenders in the Do Not Pay Portal for the following: (1) Credit Alert 
System (CAIVRS); (2) System for Award Management Entity Registration 
Records (SAMENT); (3) System for Award Management Exclusion Records- 
Restricted (SAM-EXCL-RES) and (4) Treasury Offset Program Debt Check 
(DBCK). If the lender is a non-profit, the Agency will also screen for 
Internal Revenue Service (IRS) Automatic Revocation of Exemption List 
(ARL).
    Screening will take place when the lender submits a complete 
application to the Agency. At the time of application, each lender must 
have an active registration in SAM before submitting its application in 
accordance with 2 CFR 25.200. To register in SAM, entities will be 
required to obtain a UEI. Instructions for obtaining the UEI are 
available at https://sam.gov/entity-registration. Further information 
regarding SAM registration and the UEI can be found in the Lender 
Eligibility Information section of this notification.
    Also, as part of the complete application package, the lender must 
provide a list of all the lender's principals (in accordance with the 
definition below) in the organization. This information will be used to 
screen the lender's principals in the Do Not Pay Portal for SAM-EXCL-
RES at the application stage.
    As codified at 2 CFR 180.995, ``Principal'' is defined as: (a) an 
officer, director, owner, partner, principal investigator, or other 
person within a participant with management or supervisory 
responsibilities related to a covered transaction; or (b) a consultant 
or other person, whether or not employed by the participant or paid 
with Federal funds, who--(1) is in a position to handle Federal funds; 
(2) is in a position to influence or control the use of those funds; or 
(3) occupies a technical or professional position capable of 
substantially influencing the development or outcome of an activity 
required to perform the covered transaction.
    (a) Lender Certification: The lender must certify that the lender 
will make a loan to the prospective borrower for the proposed property, 
under specified terms and conditions subject to the issuance of the 
GRRHP guarantee. Lender certification must be on the lender's 
letterhead and signed by both the lender and the prospective borrower.
    (b) Project Specific Data: The lender must submit the project 
specific data below. For the applicant's convenience, the Agency has 
made a Section 538 GRRHP Response Template available on the Agency's 
Multifamily Housing Loan Guarantees website (https://www.rd.usda.gov/programs-services/multifamily-housing-programs/multifamily-housing-loan-guarantees) for applicants that choose to utilize it. The template 
is not required; however, the information is required with a complete 
application. The Agency encourages applicants to utilize and submit the 
template along with their complete application to streamline the review 
process.

[[Page 104034]]

------------------------------------------------------------------------
                                             Information that must be
              Data element                           included
------------------------------------------------------------------------
Lender Name............................  Insert the lender's name.
Lender Tax ID #........................  Insert lender's tax ID number.
Lender Unique Entity Identifier (UEI)..  Insert lender's (UEI).
Lender Contact Name....................  Name of the lender contact for
                                          loan.
Mailing Address........................  Lender's complete mailing
                                          address.
Phone #................................  Phone number for lender
                                          contact.
Fax #..................................  Insert lender's fax number.
E-Mail Address.........................  Insert lender contact e-mail
                                          address.
List of Lender's Principals............  Complete list of all of the
                                          lender's principals involved
                                          in the transaction.
Borrower Name and Organization Type....  State whether borrower is a
                                          Limited Partnership,
                                          Corporation, Indian Tribe,
                                          etc.
Equal Opportunity Survey...............  Optional Completion.
Tax Classification Type................  State whether borrower is for
                                          profit or not for profit.
Borrower Tax ID #......................  Insert borrower's tax ID
                                          number.
Borrower UEI (if applicable)...........  Insert borrower's UEI.
Borrower Address, including County.....  Borrower's complete address and
                                          county.
Borrower Phone # and E-Mail Address....  Insert borrower's phone number
                                          and e-mail address.
Principal or Key Member for the          Insert name and title. List the
 Borrower (as defined in 2 CFR 180.995).  general partners if a limited
                                          partnership, officers if a
                                          corporation or members of a
                                          Limited Liability Corporation.
Borrower Information and Statement of    Attach relevant information.
 Housing Development Experience.
New Construction, Acquisition with       State whether the project is
 Rehabilitation.                          new construction or
                                          acquisition with
                                          rehabilitation.
Revitalization, Repair, and Transfer     Yes or No (Transfer costs,
 (as stipulated in 7 CFR 3560.406) of     including equity payments, are
 Existing Direct Section 515 and          subject to Agency approval and
 Section 514/516 FLH or MPR.              must be an eligible use of
                                          loan proceeds in 7 CFR
                                          3565.205).
Project Location Town or City..........  Town or city in which the
                                          project is located.
Project County.........................  County in which the project is
                                          located.
Project State..........................  State in which the project is
                                          located.
Project Zip Code.......................  Insert zip code where the
                                          project is located.
Project Congressional District.........  Congressional District for
                                          project location.
Project Name...........................  Insert project name.
Project Type...........................  Family, senior (all residents
                                          55 years or older), or mixed.
Property Description and Proposed        Provide as an attachment.
 Development Schedule.
Total Project Development Cost.........  Enter amount for total project.
# of Units.............................  Insert the number of units in
                                          the project.
Ratio of 3-5 Bedroom Units to Total      Insert percentage of 3-5
 Units.                                   bedroom units to total units.
Cost Per Unit..........................  Total development cost divided
                                          by number of units.
Rent...................................  Proposed rent structure.
Median Income for Community............  Provide median income for the
                                          community.
Evidence of Site Control...............  Attach relevant information.
Description of any Environmental issues  Attach relevant information.
 referenced in the Phase I report.
Loan Amount............................  Insert the loan amount.
Borrower's Proposed Equity.............  Insert amount and source.
Low Income Housing Tax Credits, if       Have tax credits been awarded?
 applicable.                             If tax credits were awarded,
                                          submit a copy of the award/
                                          evidence of award with your
                                          application.
                                         If not, when do you anticipate
                                          an award will be made
                                          (announced)?
                                         What is the [estimated] value
                                          of the tax credits?
                                         Letters of application and
                                          commitment letters should be
                                          included, if available.
Low Income Housing Qualified Contract    A document certifying the QC
 (QC) Waiver Documentation, if            rights have been waived must
 applicable.                              be included with the complete
                                          application if the applicant
                                          is seeking priority points for
                                          waiver of QC rights.
Maturing Mortgage Date of existing       Include maturity date.
 Section 515/514/516 Rural Development
 properties (if applicable).
Other Sources of Funds.................  List all funding sources other
                                          than tax credits and amounts
                                          for each source, type, rates
                                          and terms of loans or grant
                                          funds.
Loan to Total Development Cost.........  Guaranteed loan divided by the
                                          total development costs of
                                          project.
Debt Coverage Ratio....................  Net Operating Income divided by
                                          debt service payments.
Percentage of Guarantee................  Percentage guarantee requested.
Collateral.............................  Attach relevant information.
Colonia, Tribal Lands, or State's        Colonia, on an Indian
 Consolidated Plan or State Needs         Reservation, or in a place
 Assessment.                              identified in the State's
                                          Consolidated Plan or State
                                          Needs Assessment as a high
                                          need community for multifamily
                                          housing.
Is the Property Located in a Federally   If yes, please provide
 Declared Disaster Area?.                 documentation (e.g.,
                                          Presidential Declaration
                                          document).
Population.............................  Provide the population of the
                                          county, city, or town where
                                          the project is or will be
                                          located.
What Type of Guarantee is Being          Enter the type of guarantee.
 Requested, Permanent Only (Option 1),
 Construction and Permanent (Option 2),
 or Continuous (Option 3).
Loan Term..............................  State repayment and
                                          amortization terms (Minimum 25-
                                          year term.

[[Page 104035]]

 
                                         Maximum 40-year term (includes
                                          construction period).
                                         May amortize up to 40 years.
                                         Balloon mortgages permitted
                                          after the 25th year.)
Guarantee Fee Structure Designation....  Indicate the Guarantee Fee
                                          Structure:
                                         Standard Fee.
                                         Preservation of 514/515/516.
                                         Workforce Housing.
                                         Energy Efficient/Green.
                                         (Documentation is required).
Participation in Energy Efficient        Initial checklist indicating
 Programs.                                prerequisites to register for
                                          participation in a particular
                                          energy efficient program. All
                                          checklists must be accompanied
                                          by a signed affidavit by the
                                          project architect stating that
                                          the goals are achievable. If
                                          property management is
                                          certified for green property
                                          management, the certification
                                          must be provided.
Proposed Closing Date..................  Include the proposed closing
                                          date of the Section 538 GRRHP
                                          loan.
Is commercial space associated with      Indicate Yes or No.
 this property?.
If commercial space is associated,       Indicate Yes, No or N/A. (If
 please indicate if the Gross Floor       yes, Agency approval is
 (GF) Area exceeds 10% of residential     required).
 units/common area.
If commercial space is associated with   Indicate Yes, No or N/A. (If
 the property, please indicate if the     yes, Agency approval is
 income from the commercial space         required).
 activity exceeds 10% of the annual
 operating income.
------------------------------------------------------------------------

    (c) The Proposed Borrower Information:
    i. In accordance with 2 CFR 180.300, the lender must verify and 
provide documentation to the Agency that the borrowing entity and the 
borrowing entity's principals are not excluded or disqualified; and the 
lender's borrower must verify the management agent and the management 
agent's principals are not excluded or disqualified by:
    a. Checking SAM Exclusions (https://sam.gov); or
    b. Collecting a certification; or
    c. Adding a clause or condition to the covered transaction.

The lender must provide a certification to the Agency that their 
borrower verified the management agent and the management agent's 
principals are not excluded or disqualified.
    ii. Borrower's unaudited or audited financial statements.
    (d) Lender Eligibility and Approval Status: Evidence that the 
lender is either an approved lender for the purposes of the GRRHP or 
that the lender is eligible to apply for approved lender status. The 
lender's application package requesting approved lender status can be 
submitted with the application. If a lender who has not yet been 
approved by the Agency submits a Section 538 GRRHP complete 
application, the lender approval application must be submitted to the 
Multifamily Housing Asset Management Division, Risk and Counterparty 
Oversight Branch, [email protected] within 30 calendar days of 
application submission or within 30 calendar days of Agency 
notification, whichever is later (see SUBMISSION OF DOCUMENTATION FOR 
GRRHP LENDER APPROVAL above). The Agency will not issue a loan note 
guarantee until the lender is approved by the Agency.
    (e) Competitive Criteria: Information that shows how the proposal 
is responsive to the priority scoring criteria specified in this 
notification.
    (3) Content of Application: The lender must submit a complete 
application which consists of the following:
    (1) Section 538 GRRHP Response Template. The project specific data 
outlined above in section IV (2) (b). For the applicant's convenience, 
the Agency has made a Section 538 GRRHP Response Template available on 
the Agency's Multifamily Housing Loan Guarantees website (https://www.rd.usda.gov/programs-services/multifamily-housing-programs/multifamily-housing-loan-guarantees) for applicants that choose to 
utilize it; however, the template is not required. The Agency 
encourages applicants to utilize and submit the template along with 
their complete application to streamline the review process. If the 
applicant chooses not to use the template, the information is still 
required to be submitted with the completed application.
    (2) Lender Certification. The lender's certification will serve as 
assurance to the Agency that the borrower, the project, and the 
proposed financing meet the lender's standards for loan making. The 
lender must certify the following on the lender's letterhead:
    [shabox1] The information contained in the application is 
consistent with the lender's underwriting and loan making standards.
    [shabox1] That a current and accurate list of the lender's Officers 
and Principals has been provided to the Agency.
    [shabox1] The lender has completed the lender's review and has 
identified any significant findings in a narrative attached to the 
certification.
    [shabox1] The lender agrees to make a loan to the borrower for the 
proposed project, subject to the Agency's issuance of an appropriate 
guarantee option.
    [shabox1] The proposed loan amount (for such part of the property 
attributable to dwelling use) does not exceed the applicable maximum 
per unit dollar amount limitations under section 207 (c) of the 
National Housing Act.
    [shabox1] The owner and development team have the qualifications 
and experience sufficient to carry out development, management, and 
ownership responsibilities.
    [shabox1] If the lender is applying for a continuous guarantee, the 
project has the appropriate low loan-to-cost ratio as determined by the 
Agency [7 CFR 3565.52(c)(3)].
    [shabox1] The property is located in an eligible rural area.
    [shabox1] The lender has conducted due diligence and the results 
have been taken into consideration in the appraisal.
    [shabox1] The lender has reviewed and approved the management plan 
and agreement and confirmed that they are consistent with Agency 
requirements.
    [shabox1] The construction meets basic construction requirements.
    (3) Exhibits and Supporting Information. Forms to be included in 
the application package:

[shabox1] Form RD 3565-1, Application for Loan and Guarantee.
[shabox1] Form RD 3565-3, Lender's Agreement.
[shabox1] RD Instruction 1940-Q, Exhibit A-2, Statement for Loan 
Guarantees.

[[Page 104036]]

[shabox1] Attachment 4-D, Housing Allowances for Utilities and Other 
Public Services.
[shabox1] Form RD 1944-37, Previous Participation Certification.
[shabox1] Form RD 3560-30, Certification of No Identity of Interest 
(IOI), if applicable.
[shabox1] Form RD 3560-31, Identity of Interest Disclosure/
Qualification Certification, if applicable.
[shabox1] Form RD 1910-11, Applicant Certification, Federal Collection 
Policies for Consumer or Commercial Debts.
[shabox1] FEMA Form 086-0-32, Special Flood Hazard Determination (7 CFR 
3565.254).
[shabox1] Form RD 1924-13, Estimate and Certificate of Actual Cost.
[shabox1] Form RD 400-4, Assurance Agreement.
[shabox1] Form RD 1924-25, Plan Certification Form.
[shabox1] Form RD 400-1, Equal Opportunity Agreement.
[shabox1] Form RD 400-6, Compliance Statement.
    (4) Other Required Supporting Information:
    (i) Borrower information:
    [shabox1] Financial statements with certification(s) (newly formed 
entities applying for a construction/permanent guarantee do not need to 
provide financial statements at the time of application).
    [shabox1] Credit report for the entity and any guarantor.
    [shabox1] Proposed limited partnership agreement and certificate of 
limited partnership (if applicable). Agency requirements should be 
contained in one section of the agreement and their location identified 
by the borrower or their attorney in a cover sheet.
    [shabox1] If a corporate entity, its Articles of Organization and 
its Operating Agreement.
    (ii) If the borrower is a nonprofit organization:
    [shabox1] Tax-exempt ruling from the IRS designating them as a 
501(c)(3) or 501(c)(4) organization. If the designation is pending, a 
copy of the designation request must be submitted.
    [shabox1] Evidence of organization under State law or copies of 
pending applications.
    [shabox1] A list of board members.
    (iii) If the borrower is a public body:
    [shabox1] The enabling statute or the State law of organization.
    (iv) Project Information:
    [shabox1] An application fee, if required by the Agency.
    [shabox1] An appraisal.
    [shabox1] A market study. Contents of the market study should 
include, at a minimum, the following information:
    1. A complete description of the proposed site, including location 
of the land, location of services, and their distances from the site.
    2. Major employment data including: the name, location, and date of 
establishment of any major employers within the community; the product 
or service of each employer; the number of employees and salary range 
for each employer; and business permits issued per year for the last 
three years.
    3. Population by year, number, and total, plus the annual increase/
decrease and percentage.
    4. Population characteristics by age.
    5. Household data by number, year, and number of persons per 
household.
    6. Breakdown of households by owners and renters.
    7. Households by income group.
    8. Building permits issued per year for single and multiple unit 
dwellings.
    9. Housing stock as defined by total number of units: one unit 
buildings, two or more unit buildings, mobile homes, and the number of 
these lacking some, or all, plumbing facilities (substandard housing).
    10. A survey of existing rental housing including: name, number of 
units, bedroom mix, family or elderly type, year built, rent, 
vacancies, location, and amenities.
    11. Number of rent-overburdened households.
    12. A projection of housing demand based on:
    (a) Household growth.
    (b) Units constructed since the last census.
    (c) Number of owned and rented units.
    (d) Number of replacements.
    (e) Number of persons in the eligible income range.
    13. For proposals where the applicant is requesting low-income 
housing tax credits (LIHTC), the applicant must provide the number of 
LIHTC units and the maximum LIHTC incomes and rents by unit size. This 
information will determine the levels of incomes in the market area 
which will support the basic rents while also qualifying the borrower 
for tax credits.
    [shabox1] Project information including project name, location, 
number and type of units, the development team, property manager, 
lawyer, and syndicator. The development team includes the developer 
(including all principals), architect, and contractor.
    [shabox1] Capital Needs Assessment (for rehabilitation loans only). 
Does the Capital Needs Assessment and Capital Improvement Plan call for 
a replacement reserve escrow that meets or exceeds the $1,000/unit 
threshold by year three? If not, document underwriting explanation (7 
CFR 3565.254(b)(4)). Include a Reserve for Replacement schedule.
    [shabox1] State Clearinghouse comments or recommendations.
    [shabox1] Site plan, including contour lines.
    [shabox1] Plot plan.
    [shabox1] Floor plan of each living unit type and other type 
spaces.
    [shabox1] Building exterior elevations.
    [shabox1] FEMA Form 086-0-33, Elevation Certificate.
    [shabox1] Typical building exterior wall section.
    [shabox1] Description and justification of any related facilities 
and schedule of separate charges for related facilities, if any.
    [shabox1] Design development/working plans/construction 
specifications. Plans, specifications, and estimates must fully 
describe all of the work to be completed, including all landscaping, 
construction, repairs, and site development work. The plans must be 
clear and accurate with adequate dimensions and sufficient scale for 
estimating purposes.
    [shabox1] Technical data, tests, or engineering evaluations needed 
to support the design of the development must be included.
    (v) Property Management Information:
    [shabox1] Management plan and proposed management agreement.
    [shabox1] Details for managing a project with scattered sites (if 
applicable).
    [shabox1] Procedures for determining applicant eligibility.
    [shabox1] Demonstrated capacity to manage the unique leasing 
occupancy restrictions of the guaranteed program.
    [shabox1] Description of rent collection; lease provisions covering 
termination and eviction; copy of tenant protection and grievance 
procedures to tenants.
    [shabox1] Description of security plan.
    [shabox1] Plans for maintenance, repair, replacement, and tenant 
work requests.
    [shabox1] Detailed compliance with Federal, Tribal, and State 
environmental laws.
    [shabox1] Description of energy conservation measures including 
recycling.
    [shabox1] Detailed management and maintenance staffing plans.
    [shabox1] Information on staff training programs.
    [shabox1] Statement confirming that the management plan includes 
provision for access to project's books and records by USDA staff, 
USDA--Office of Inspector General, Government Accountability Office, 
and the Department of Justice; information on accounting, record 
keeping, data systems, and software. (7 CFR 3565.351 (a)(7)).
    [shabox1] Qualifications of the property manager.
    (vi) Contractor Information:

[[Page 104037]]

    [shabox1] Demonstrated experience of the general contractor in 
building multifamily housing of the size design, scope, and complexity 
of the project. Note any exceptions.
    (vii) Financing Information:
    [shabox1] Lender's conditional commitment on the lender's 
letterhead with lender's signature specifying the GRRHP option under 
which the project loan is to be guaranteed.
    [shabox1] Sources and uses, pro forma statement or a comparable 
document.
    [shabox1] Lender's narrative. Must include the following 
information:
    [ssquf] Summary of Loan Request
    [ssquf] Financing Terms/Commitment
    [ssquf] Specify how the loan is classified:
     Existing property (7 CFR 3565.252)
     515 Rehab
     New construction (7 CFR 3565.252)
    [ssquf] Confirm property is located in an eligible rural area (7 
CFR 3565.3 and 3565.251)
    [ssquf] General site requirements (7 CFR 3565.254)
    [ssquf] General site standards (7 CFR 3565.254)
    [ssquf] Borrower/Sponsor's Qualifications
    [ssquf] Property History
    [ssquf] Site/Area/Neighborhood Analysis
    [ssquf] Improvements/Physical Needs
    [ssquf] Environmental Issues
    [ssquf] Review of Market Analysis
    [ssquf] Review of Market Appraisal
    [ssquf] Income/Expense Pro forma
    [ssquf] Valuation
    [ssquf] Management Review. The following are examples of 
documentation which can be submitted to the Agency to establish 
evidence of the management agency's experience:
    [cir] Name of the Management Entity.
    [cir] Management Entity Type (Owner/Manager; Independent Fee Agent; 
Identity-of-Interest Agent; or Project Administrator).
    [cir] Employer Identification Number (EIN).
    [cir] Specify Organization Type (Corporation; Partnership; 
Individual; or Other).
    [cir] Names, titles and Social Security Numbers of firm's 
principals (e.g., general partner, president, treasurer, etc.).
    [cir] Provide mailing addresses for the Company's home office and 
if applicable, any branch offices involved in management of the 
Department of Housing and Urban Development (HUD) or other affordable 
multifamily projects. Specify the geographic area covered by each 
office.
    [cir] If applicable, what year (yyyy) did the company begin 
managing: HUD or other affordable subsidized projects; HUD or other 
affordable unsubsidized projects; and/or Conventional projects.
    [cir] If applicable, estimate what percent of company's activities 
involve management of: Conventional projects; HUD or other affordable 
projects; Commercial space; and/or Other.
    [cir] If applicable, the number of projects the company manages 
(both rentals and cooperatives): HUD or other affordable unsubsidized 
housing; HUD or other affordable subsidized housing; and/or HUD or 
other affordable owned housing. Of these, how many have HUD or other 
affordable housing held mortgages; are non-insured; are subsidized co-
ops; are unsubsidized co-ops and the percentage of elderly; family; 
owned by a non-profit or coop; core city; troubled neighborhood; 
suburban and rural area.
    [cir] Indicate where each of the following activities are 
administered. Use the following codes: C = central office; R = regional 
office; P = project site: Bookkeeping; landscaping; maintenance; 
purchasing; tenant application; certification/recertifications; regular 
monthly subsidy billings; and special claims subsidy billings.
    [cir] Number of the company's full-time employees serving in the 
following supervisory or advisory roles (Owner-managers and 
administrators of projects for the elderly should provide this 
information on project employees): Engineers; maintenance supervisors; 
occupancy supervisors; training specialists; social service 
coordinators; regional property managers; indicate number and 
percentage of minorities serving in supervisory or advisory roles.
    [cir] Identify any professional memberships, licenses, certificates 
or accreditations which are related to property management activities 
and are held by the company, company executives, or employees.
    [cir] Describe any purchasing procedures you have implemented to 
control or reduce cost (e.g., bulk purchasing, paying early to take 
advantage of discounts, cost comparisons or bids, etc.).
    [cir] List any companies which regularly supply goods or services 
to federally funded projects and have an identity-of-interest with the 
management entity or its principals (e.g., officers, general partners). 
Specify the type of goods and services provided.
    [cir] Do any of the identity-of-interest companies listed function 
as ``pass-throughs''--i.e., does the identity-of-interest company 
purchase goods or services from another party and pass those goods or 
services through to the project? For each pass-through arrangement:
    (1) Name the identity-of-interest company involved.
    (2) Explain how the identity-of-interest company's compensation is 
determined.
    (3) Explain why it is more advantageous for the project to use the 
pass-through arrangement than to purchase directly from the ultimate 
supplier.
    [cir] What types of property management procedures or operating 
manuals are used by on-site or supervisory staff?
    [cir] What types of recurring written reports are prepared on 
project operations (e.g., maintenance, move-in/outs, payables, 
comparisons of budgeted and actual expenses)? Specify who (by position 
title) prepares the report, frequency of the report, and who reviews 
the report.
    [cir] Specify how frequently company executives or supervisory 
staff visit the projects the company manages and who (by position 
title) conducts the on-site visits or reviews.
    [cir] If the company manages subsidized projects, identify by job 
title who prepares and reviews the HUD (or other affordable housing) 
required documents and the frequency of their review for the following: 
HUD's (or other affordable housing) Initial Certifications; 
Recertifications; Regular Monthly Subsidy Billings; Special Claims 
Subsidy Billings; Proposals to terminate tenant assistance payments; 
Proposals to evict; Monthly Accounting Reports; and Civil Rights Tenant 
Characteristics/Occupancy Reports.
    [cir] If applicable, describe how the home office supervises 
supervisory staff (e.g., property managers, occupancy specialists, 
maintenance supervisors), who operate out of branch offices.
    [cir] Describe how the company trains its employees in the areas 
listed below. Discuss both on-going training and initial training 
provided when the employee is hired. Specify the frequency and duration 
of the training and who/what organization conducts the training. 
Discuss training for both supervisory and front-line staff for the 
following: Property management practices; Financial and recordkeeping 
requirements; Civil rights and fair housing laws; and Occupancy 
Requirements of Subsidized Multifamily Housing Programs (if the company 
manages subsidized projects).
    [cir] If applicable, specify if an owner of a HUD-related project 
or other affordable housing project, at any time during the past three 
years, cancelled a property management contract held by the company and 
identify during the past three years, how many HUD-related

[[Page 104038]]

projects or other affordable housing projects have not renewed their 
management contracts with the company (Explain the reasons for any 
cancellations or failure to renew and identify the projects involved).
    [cir] If applicable, provide a list of all HUD Field Offices that 
have jurisdiction over the projects. For companies that operate in more 
than five Field Office jurisdictions, identify the five jurisdictions 
where the greatest number of your HUD-related projects are located.
    [cir] List all State Agencies in whose jurisdiction you have 
managed or are managing State Agency-financed projects. For companies 
that operate in more than five States, identify the five where the 
greatest number of your State Agency projects are located.
    [cir] List the location of all RD properties you have managed or 
are managing. For companies that operate in more than five RD 
jurisdictions, identify the five where the greatest number of your RD 
properties are located.
    [shabox1] A copy of the pro forma budget detailing the first year 
and a typical year's operation. (Pro formas with and without the 
interest credit award will serve as justification for the interest 
credit award, if applicable.)
    [shabox1] Disclosure of any change in financing since application 
submission.
    [shabox1] Type of utilities and utility allowances, if applicable.
    [shabox1] Confirm that Operating and Maintenance (O&M) Reserve is 
at least two percent of the total loan amount (not just guaranteed 
portion). Calculation of O&M reserve for congregate care facilities and 
larger projects should reflect absorption rates in the market study to 
cover shortfalls between estimated operating budget calculations and 
rent-up assumptions. Funds contributed as O&M reserves are contributed 
from the borrower's own resources or an irrevocable letter of credit 
and are not to be included as part of the total development cost 
calculation. (7 CFR 3565.402 (a)(2))
    [shabox1] Confirm that the construction contingency is equal to two 
percent of the construction contract, inclusive of the contractor's fee 
and hard and soft costs. This is to be funded at or prior to closing by 
the contractor (7 CFR 3565.402 (a)(2)).
    [shabox1] Provide evidence of adequate insurance for the property 
(7 CFR 3565.351).
    [shabox1] Interest Credit Request, if applicable.
    Environmental Information:
    [shabox1] Most current version of the ASTM Standard E 1528-14, 
Phase I Environmental Site Assessment Process published by the American 
Society for Testing and Materials (ASTM).
    [shabox1] Environmental Information in accordance with 7 CFR part 
1970 (Environmental Policies and Procedures).
    [shabox1] Statement from the State Historic Preservation Office 
(SHPO) indicating compliance with historic and architectural laws, if 
applicable.
    [shabox1] Comments regarding relevant off-site conditions.
    [shabox1] Land survey.
    Legal and Regulatory Items:
    [shabox1] Standard Regulatory Agreement approved by the Agency (7 
CFR 3565.303(d)(9) and (11), or
    [shabox1] Non-Standard Regulatory Agreement(s) containing 
provisions for transferability between lenders, binding on the borrower 
and their successors (7 CFR 3565.351(a)) and requiring that the 
borrower: make all principal and interest payments under the note, 
maintain the property as affordable housing in good physical condition; 
maintain complete project books and records; and comply with all 
Federal Fair Housing requirements under the terms of the note (7 CFR 
3565.351(a)).
    [shabox1] For new construction projects that have five or more 
rental units, an Affirmative Fair Housing Marketing Plan (AFHMP) as 
defined in 24 CFR part 200, subpart M, is required to be submitted. 
Federally recognized Tribes and Tribally Designated Housing Entities 
(TDHE) are excluded when the project is located on tribal land.
    [shabox1] Rehabilitation/preservation transactions must submit 
confirmation in writing that the borrower is in compliance with the 
Affirmative Fair Housing Marketing Plan (7 CFR 3565.353).
    [shabox1] Certification from the lender verifying the use of 
security instruments prepared, executed, recorded and/or delivered per 
program guidelines and in compliance with the terms of the conditional 
commitment.
    [shabox1] Certification from the lender verifying the use of the 
construction contract based on standard AIA Document A-101. If this 
document is used, it should be modified as described in Form RD 1924-25 
or similar form.
    [shabox1] Certification from the lender verifying the use of 
contract specifications, documents and forms. Use Form RD 1924-6 
``Construction Contract'' or similar document as required by Executive 
Order 11246, Non- Discrimination in Employment by Construction 
Contractors.

V. Application Review Information

    (1) Scoring of Priority Criteria for Selection: Complete 
applications received will be scored based on the criteria set forth 
below to establish priority in the event there is insufficient funding. 
Per 7 CFR 3565.5(b), priority will be given to projects in rural areas 
in which borrowers can best utilize loan guarantees and where loan 
guarantees are needed the most, as determined by the Agency based on 
information the Secretary considers appropriate. To meet important 
program goals, priority points will be given for projects that qualify 
for reduced annual fees, including workforce housing, section 515 or 
section 514/516 preservation and green and energy efficient housing 
projects as permitted in 7 CFR 3565.5(b).
    The priority scoring criteria for projects are listed below.
    Priority 1--Properties located in eligible rural communities with 
the lowest populations. One point is awarded if the city or town 
population is under 10,000 people.
    Priority 2--Properties in the most-needy communities. One point is 
awarded if the property is located in a persistent poverty county as 
defined by the USDA Economic Research Service.
    Priority 3--Properties that demonstrate partnering and leveraging 
of third-party funding. One point is awarded if the loan to total 
development cost ratio is less than 50%.
    Priority 4--Properties with the highest ratio of 3-5 bedroom units 
to total units. One point is awarded if the ratio of 3-5 bedroom units 
to total units is 25% or more.
    Priority 5--Properties on tribal land. One point is awarded if the 
property is located on tribal land.
    Priority 6--Properties with a lower Section 538 guaranteed loan 
interest rate. One point is awarded if the interest rate is equal to or 
less than 130% of the long-term annual applicable Federal rate (AFR 
Table 1) at the time of application submission to the Agency.
    Priority 7--Properties determined eligible for reduced annual 
section 538 fees under the Federal Register notice published on March 
3, 2022 (87 FR 12077). One point awarded for each of the criteria met 
for reduced annual fees: (1) Workforce Housing (Rents Between 80%-115% 
Area Median Income), or (2) Preservation of Existing Section 515 and 
Section 514/516 Rural Development Properties, or (3) Section 538 New 
Construction or Substantial Rehabilitation Meeting Green or Energy 
Efficiency Requirements. Projects will be held to the standards and

[[Page 104039]]

requirements for the selected energy program that were in effect at the 
time the application was submitted to the Agency.
    Priority 8--Energy consumption performance. One point will be 
awarded if the lender obtains the borrower's agreement to enroll in the 
United States Environmental Protection Agency's ENERGY STAR Portfolio 
Manager and document and report energy consumption for the property to 
the Agency. Along with the collection of the borrower's annual reports 
(outlined in 7 CFR 3565.351), to obtain the priority points the lender 
must collect the Statement of Energy Performance (SEP) report from the 
borrower and submit it to the Agency for review. This will allow the 
Agency to track the energy consumption performance of the property. 
Borrowers may access the EPA's ENERGY STAR Portfolio Manager software 
at no cost.
    Priority 9--Projects that include Low Income Housing Tax Credits 
financing that have waived or will waive their Qualified Contract 
Rights. Twelve points will be awarded to projects that include LIHTC 
financing in which the owner has agreed to waive the Qualified Contract 
rights. A document certifying that the rights have been waived must be 
included with the complete application.
    Priority 10--Projects that have or are assuming section 514/515 
loans that will naturally mature within three years from application 
submission will receive one point.
    Priority 11--Projects Providing Access to Supportive Services for 
Tenants. One point will be awarded to projects that employ a Service 
Coordinator, documented as a project expense in the most recent agency-
approved Form RD 3560-7 Multifamily Housing Project Budget/Utility 
Allowance, or include units designated as permanent supportive units or 
for homeless households, documented by an agreement with another 
Federal or State funding source. To receive points, the applicant must 
describe the basis for claiming points (i.e., service coordinator and/
or permanent supportive housing/homeless unit set-aside) and provide 
documentation to include the Form 3560-7 and/or an agreement describing 
the terms and conditions for the units designated as permanent 
supportive housing or for homeless households, as applicable.
    If there is insufficient funding available to fund all approved 
projects and projects have equal scores based on the priority criteria, 
the Agency will rank the tied projects based on the scores for Priority 
7. If there is still a tie, the Agency will obligate funds in the order 
in which the applications were approved by the Agency.
    (2) Notifications: Applications will be reviewed concurrently for 
completeness and eligibility. The Agency will notify the lender 
generally within 30 days of receipt of a complete application. 
Incomplete applications, which includes supporting documentation, will 
be returned to the lender. The lender may reapply in the future with a 
new and complete application.

VI. Award Administration Information

    (1) Obligation of Program Funds: The Agency will only obligate 
funds to projects that meet the requirements under 7 CFR part 3565 and 
this notification that have submitted a complete application and have 
undergone a satisfactory environmental review in accordance with the 
National Environmental Protection Act (NEPA). If there is sufficient 
funding, once a complete application is received and approved (and any 
request for GRRHP approved lender status is granted), the Agency will 
obligate funds. The Agency considers the program to have insufficient 
funds when the program's annually appropriated funding amount has 10% 
(ten percent) or less remaining. If there is insufficient funding, the 
Agency will review the scores for each approved project and rank them 
accordingly. As funding becomes available, funding for approved 
projects will be obligated based on the rankings from high to low 
scores as described in section V. (Application Review Information).
    In the event that the Agency suspends the ability to receive 
applications until sufficient funding becomes available, a notice will 
be made to the industry via GovDelivery and/or some other form of 
acceptable electronic notice.
    (2) Conditional Commitment: Once the required documents for 
obligation are received and all applicable requirements have been met, 
including NEPA requirements, and to the extent funding is available, 
the Agency will issue a Conditional Commitment. The Conditional 
Commitment will stipulate the conditions that must be fulfilled before 
the issuance of a guarantee, in accordance with 7 CFR 3565.303(b).
    A Conditional Commitment must be issued by the Agency before any 
construction begins on the project. Drawings (plans) and specifications 
for building construction must be submitted to the Agency and concurred 
by the Agency before any construction begins on the project. Applicants 
are reminded that in accordance with 7 CFR 3565.206(g), refinancing of 
an existing debt is not an eligible use of Section 538 GRRHP loan 
funds, except in the case of an existing guaranteed loan where the 
Agency determines that the refinancing is in the government's interest 
or furthers the objectives of the program.
    (3) Issuance of Guarantee: The Agency will issue a guarantee to the 
lender for a property in accordance with 7 CFR 3565.303. No guarantee 
can be issued without a complete application, review of appropriate 
certifications, satisfactory assessment of the appropriate level of 
environmental review, and the completion of any conditional 
requirements.
    (4) Tracking of Average Rents: After the loan closes, the lender 
will track the initial affordable rent at each property funded and the 
average market rent in the area. The difference between these two rents 
will provide the lender with a measure of the impact the GRRHP has on 
affordable rents.

Build America, Buy America

    Funding to Non-Federal Entities. Awardees that are Non-Federal 
Entities, defined pursuant to 2 CFR 200.1 as any State, local 
government, Indian Tribe, Institution of Higher Education, or nonprofit 
organization, shall be governed by the requirements of section 70914 of 
the Build America, Buy America Act (BABAA) within the Infrastructure 
Investment and Jobs Act (Pub. L. 117-58), and its implementing 
regulations at 2 CFR part 184. Any requests for waiver of these 
requirements must be submitted pursuant to USDA's guidance available 
online at https://www.usda.gov/ocfo/federal-financial-assistance-policy/USDABuyAmericaWaiver.

Non-Discrimination Statement

    In accordance with Federal civil rights law and U.S. Department of 
Agriculture (USDA) civil rights regulations and policies, the USDA, its 
Mission Area, agencies, staff offices, employees, and institutions 
participating in or administering USDA programs are prohibited from 
discriminating based on race, color, national origin, religion, sex, 
gender identity (including gender expression), sexual orientation, 
disability, age, marital status, familial/parental status, income 
derived from a public assistance program, political beliefs, or 
reprisal or retaliation for prior civil rights activity, in any program 
or activity conducted or funded by USDA (not all bases apply to all 
programs). Remedies and complaint filing deadlines vary by program or 
incident.
    Program information may be made available in languages other than

[[Page 104040]]

English. Persons with disabilities who require alternative means of 
communication to obtain program information (e.g., Braille, large 
print, audiotape, American Sign Language) should contact the 
responsible Mission Area, agency, or staff office; or the 711 Relay 
Service.
    To file a program discrimination complaint, a complainant should 
complete a Form AD-3027, USDA Program Discrimination Complaint Form, 
which can be obtained online at https://www.usda.gov/sites/default/files/documents/ad-3027.pdf from any USDA office, by calling (866) 632-
9992, or by writing a letter addressed to USDA. The letter must contain 
the complainant's name, address, telephone number, and a written 
description of the alleged discriminatory action in sufficient detail 
to inform the Assistant Secretary for Civil Rights (ASCR) about the 
nature and date of an alleged civil rights violation. The completed AD-
3027 form or letter must be submitted to USDA by:
    (1) Mail: U.S. Department of Agriculture, Director, Office of 
Adjudication, 1400 Independence Avenue SW, Washington, DC 20250-9410;
    (2) Fax: (202) 690-7442; or
    (3) Email: [email protected].
    USDA is an equal opportunity provider, employer, and lender.

Yvonne Hsu,
Acting Administrator, Rural Housing Service.
[FR Doc. 2024-30330 Filed 12-19-24; 8:45 am]
BILLING CODE 3410-XV-P
```