[Federal Register Volume 60, Number 79 (Tuesday, April 25, 1995)]
[Rules and Regulations]
[Pages 20356-20358]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-10087]




[[Page 20355]]

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Part VI





Department of Housing and Urban Development





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24 CFR Part 215, et al.



Treatment of Holocaust Reparation Payments in Assisted Housing; Rule

Federal Register / Vol. 60, No. 79 / Tuesday, April 25, 1995 / Rules 
and Regulations 
[[Page 20356]] 

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of the Secretary

24 CFR Parts 215, 235, 236, 280, 813, 913, and 950

[Docket No. N-95-3900; FR-3856-N-01]


Treatment of Holocaust Reparation Payments in Assisted Housing 
Programs: Notification of Affected Individuals

AGENCY: Office of the Secretary, HUD.

ACTION: Notification of policy.

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SUMMARY: Before April 23, 1993, the Department of Housing and Urban 
Development counted Holocaust reparation payments made by foreign 
governments as income in its means-tested rental housing assistance 
programs. This policy may have caused some applicants to be denied 
admission to assisted housing, and some residents of the housing to pay 
a higher contribution to rent, because these payments were included in 
their income.
    This document announces that the Department will attempt to provide 
relief to individuals adversely affected by this policy. As described 
more fully below, the Department will attempt to inform those who were 
denied eligibility of their potential current eligibility for rental 
assistance. For those whose rents were increased, the Department will 
attempt to find an administrative way to recompense them for the 
increased rent they paid.
    The policy announced in this document applies to all initial and 
continuing income determinations that were conducted before April 23, 
1993. The policy also applies to the Section 235 Homeownership Program. 
Members of the public who believe they may qualify for relief are 
encouraged to contact the appropriate Departmental official listed 
below for more information. It should be noted that in some cases, 
recompense may not be possible without further congressional action.

FOR FURTHER INFORMATION CONTACT: For Public and Indian Housing 
programs: Contact Sherone Ivey, Acting Director, Office of Assisted 
Housing, Room 4206, telephone (202) 708-0744 (voice), (202) 708-9300 
(TDD).
    For the Rent Supplement Program; the Section 236 Program (including 
RAP); Section 8 Programs (including New Construction, Substantial 
Rehabilitation, State Agency Set-Aside, and Loan Management Set-Aside); 
the Section 515/8 Farmers Home Set-Aside Program, and the Nehemiah 
Housing Opportunity Grants Program: Contact Barbara Hunter, Acting 
Division Director, Planning and Procedures Division, Office of 
Multifamily Housing Management, Room 6180, telephone (202) 708-3944 
(voice), (202) 708-4594 (TDD).
    For the Section 202 and Section 202/8 Housing for the Elderly and 
Handicapped Programs; the Section 202 Supportive Housing for the 
Elderly Program; the Section 811 Supportive Housing for Persons with 
Disabilities Program; and the HOPE 2 Program: Contact Margaret Milner, 
Acting Director, Office of Elderly and Assisted Housing, Room 6130, 
telephone (202) 708-4542 (voice), (202) 708-4594 (TDD).
    For the Section 235 Homeownership Program: Contact Joseph Bates, 
Director, Single Family Servicing Division, Room 9178, telephone (202) 
708-1672 (voice), (202) 708-4594 (TDD).
    For the HOPE 3 Program: Contact Clifford Taffet, Program Policy 
Division, Office of Community Planning and Development, Room 7168, 
telephone (202) 708-3226 (voice), (202) 708-2565 (TDD).
    The address for all the above-listed persons is: Department of 
Housing and Urban Development, 451 Seventh Street, SW, Washington, DC 
20410. The telephone numbers listed above are not toll-free.

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act Statement

    The information collection requirements in this notice have been 
submitted to the Office of Management and Budget (OMB) for review. 
These information collection requirements are not effective until such 
time that OMB grants its approval. The approval numbers will be 
published in the Federal Register through separate notice.

Background

    The Department provides means-tested housing assistance to eligible 
low-income families under a variety of programs. Rental assistance 
programs include the following: Rent Supplement,<SUP>1 Section 
236,<SUP>2 Section 8 and Public and Indian Housing,<SUP>3 and 
Supportive Housing for Elderly<SUP>4 and Disabled Persons.<SUP>5 
Programs using Section 8 assistance include Section 8 new construction, 
substantial rehabilitation, certificate/voucher, State Housing Agency, 
Farmers Home Administration, moderate rehabilitation, loan management, 
property disposition, and Section 202/Section 8. The Department also 
provides means-tested subsidies in the Section 235 Homeownership 
Program.<SUP>6 

    \1\Section 101 of the Housing and Urban Development Act of 1965.
    \2\Section 236 of the National Housing Act.
    \3\The United States Housing Act of 1937.
    \4\Section 202 of the Housing Act of 1959, as amended by section 
801 of the Cranston-Gonzalez National Affordable Housing Act.
    \5\Section 811 of the Cranston-Gonzalez National Affordable 
Housing Act.
    \6\Section 235 of the National Housing Act. New business under 
this program was terminated effective October 1, 1989, by section 
401(d) of the Housing and Community Development Act of 1987.
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    In these programs, the Department takes family income into account 
in determining initial program eligibility, and uses periodic income 
reexaminations to determine the level of benefits to be provided 
eligible families. The Department also uses family income to determine 
eligibility for the HOPE Programs (1, 2, and 3),<SUP>7 the Nehemiah 
Housing Opportunity Grants program,<SUP>8 and the Section 23 Housing 
Assistance Payments Program.<SUP>9

    \7\Title IV of the Cranston-Gonzalez National Affordable Housing 
Act.
    \8\Title VI of the Housing and Community Development Act of 
1987, repealed by section 289(b) of the Cranston-Gonzalez National 
Affordable Housing Act.
    \9\Section 23 of the U.S. Housing Act of 1937, repealed by 
section 201(a) of the Housing and Community Development Act of 1974.
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    In establishing criteria for calculating family income, the 
Department historically counted the full amount of periodic payments 
received by program applicants and participants.<SUP>10 Since 
reparation payments made by foreign governments in connection with the 
Holocaust are made periodically (normally on a monthly basis), they 
were traditionally included in family income.

    \10\See the following regulations, as they existed before April 
23, 1993: Rent Supplement--24 CFR 21 5.21(b)(7); Section 236--24 CFR 
236.3(b)(4); Section 8--24 CFR 813.106(b)(4); and Public Housing--24 
CFR 913.106(b)(4).
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    Almost two years ago, the Department reversed this position. On 
March 24, 1993, the Department published a final rule in the Federal 
Register<SUP>11 that excluded reparation payments, paid by a foreign 
government pursuant to claims filed under the laws of that government 
by persons who were persecuted during the Nazi era, from family income 
under the rental assistance programs described above.<SUP>12

    \11\58 FR 15773, effective April 23, 1993.
    \12\This final rule did not include amendments to the Section 
235 regulations. The Department intends to implement the exclusion 
of reparation payments from income in this program through 
administrative instructions. Anyone who believes his or her 
reparation payments were included in income on or after April 23, 
1993 should contact the person identified above for this program. 
[[Page 20357]] 
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    The Department took this action voluntarily, under its general 
authority to define ``income'' for the programs involved. As indicated 
in the preamble to the final rule, the Department believes that the 
Holocaust--in both its scope and severity--represents a unique 
situation, and that payments by foreign governments intended to atone 
for atrocities committed during the Nazi era should not be taken into 
account with respect to the housing assistance programs involved.
    The final rule was prospective only. It applied to all initial and 
continuing income determinations conducted on or after its effective 
date--April 23, 1993. It also made clear that any assisted housing 
residents who had been asked to repay assistance because of their 
failure to include past reparation payments in income would be excused 
from further repayment beginning on April 23, 1993.
    The rule did not, however, provide retroactive relief to those for 
whom reparation payments were included in income pursuant to initial 
and continuing income determinations conducted before April 23, 1993. 
The preamble to the rule indicated that the Department was reviewing 
the feasibility, practicality, and desirability of making the new 
policy retroactive, and would advise the public of its conclusions in a 
later Federal Register publication.
    This notice announces that as a result of this review, the 
Department will take steps to provide appropriate retroactive relief 
where possible under current law. This notice is part of an outreach 
effort to identify individuals who may be eligible for this relief. 
This outreach will include, among other efforts, contacting Survivors' 
groups. The relief has two aspects.
    1. Those who were denied eligibility in the Department's assisted 
rental housing programs as a result of including reparation payments in 
family income.
    Section 1(d) of Pub. L. 103-286 (approved August 1, 1994) (42 
U.S.C. 1437a note) requires any Federal agency that denied individuals 
eligibility for means-tested programs by reason of counting reparation 
payments as income to make a good faith effort to notify them of their 
potential eligibility under the programs. This notice, and the outreach 
effort described above, constitute the Department's good faith effort 
to identify potential affected individuals.
    The Department encourages anyone who believes that he or she was 
found to be income-ineligible for any of the above rental assistance 
programs by reason of counting reparation payments in income, to notify 
the person listed above in the For Further Information Contact section 
of this notice for the program involved. Consistent with section 1(d) 
of the above statute, the Department will determine the individual's 
current potential eligibility for rental housing assistance.
    2. Those whose rents under the Department's assisted rental housing 
programs were increased as a result of including reparation payments in 
family income.
    The Department will, on a voluntary basis, attempt to repay the 
amount of any such rent increases and any repayments made by 
individuals to the extent permissible. Since there is no specific 
appropriation for these purposes, the critical question in determining 
whether the Department can provide this relief is the availability of 
the necessary funding under the particular program involved.
    a. Budget-based Section 202/8 projects. Based on the circumstances 
of one claimant, the Department has determined that there are funds to 
recompense residents of Section 202/Section 8 elderly projects that 
receive rent adjustments on the basis of project budgets, rather than 
through Annual Adjustment Factors. To be eligible, the individual:

--must be a current resident of the project, and
--must have resided in a Section 202/8 project during the period in 
which the reparation payments were counted as income.

    For any eligible residents of these projects, the Department will 
attempt to repay, or offset against any increased future tenant rental 
payments, the full amount of any increased rental payments stemming 
from the inclusion of reparation payments in income. The Department 
will also attempt to repay the full amount of any repayments of 
assistance paid by tenants because of their failure to include past 
reparation payments in income. The Department encourages residents of 
these projects who believe they may qualify for recompense to contact 
the individual listed under Section 8 project-based programs in the For 
Further Information Contact section of this notice.
    b. Other projects. Similarly, the Department encourages current 
residents of other assisted projects who resided in the project during 
the period in which the reparation payments were counted as income to 
contact the persons listed in the For Further Information Contact 
section of this notice for the appropriate program. Public housing 
authorities (PHAs) with locally-owned projects receiving operating 
subsidies under the Performance Funding System may, after HUD review of 
the calculations, utilize the regulatory provision at Sec. 990.110(g) 
to recalculate operating subsidy eligibility, and request current year 
funds to cover the payment of retroactive payments to eligible 
recipients. For other programs, the Department will determine the 
eligibility of the individual, as well as the availability of funds to 
provide the recompense administratively without the need for further 
congressional action. Since the Department's assisted rental housing 
programs use a variety of funding techniques, the ability to provide 
the necessary relief administratively, without the need for further 
congressional appropriation action, depends on the program involved.
    It should be noted that section 1(e) of Pub. L. 103-286 also 
purports to provide retroactive relief for those whose rents were 
increased by reason of counting reparation payments. The relief is 
limited, however, to rental payments from February 1, 1993 through 
April 30, 1993. In addition, the authority to make any recompense under 
Pub. L. 103-286 is conditioned on approval in an appropriation Act. 
Since no such approval was provided, Pub. L. 103-286 may NOT be used as 
a source of recompensing eligible individuals.
    In contrast, the Department's voluntary action announced in this 
notice is designed to provide full compensation not just for a three-
month period, but for the entire time in which reparation payments were 
taken into account. It also provides a mechanism for recompensing at 
least some eligible claimants, without the necessity of further 
appropriation action. Any recompense that cannot be provided pursuant 
to the provisions set forth in this notice requires further 
congressional action.
    3. Those who were denied eligibility, or whose level of subsidy was 
determined, as a result of including reparation payments in family 
income in the Section 235 Homeownership Program.
    Although the Department did not include the Section 235 
Homeownership Program in its March 24, 1993 final rule (58 FR 15773), 
the Department is including in its outreach [[Page 20358]] effort those 
individuals who may have been affected in this program. Any such 
individuals should notify the person listed above in the For Further 
Information Contact section for this program.

Other Matters

National Environmental Policy Act (NEPA)

    This action is categorically excluded from the NEPA requirements at 
24 CFR part 50 in accordance with 24 CFR 50.20(k), because it relates 
to an internal administrative procedure, the content of which does not 
constitute a development decision nor affect the physical condition of 
project areas or building sites.

Executive Order 12612, Federalism

    The General Counsel, as the Designated Official under section 6(a) 
of the Executive Order 12612, Federalism, has determined that the 
policies contained in this notice would not have substantial direct 
effects on States or their political subdivisions, or the relationship 
between the Federal government and the States, or on the distribution 
of power and responsibilities among the various levels of government. 
The notice simply announces the Department's intent to provide relief 
to those whose eligibility or rental payments under HUD's assisted 
rental housing programs were adversely affected by counting reparation 
payments as family income.

Executive Order 12606, The Family

    The General Counsel, as the Designated Officer under Executive 
Order 12606, The Family, has determined that this notice does not have 
potential for significant impact on family formation, maintenance, and 
general well-being, and thus is not subject to review under the Order. 
The notice simply announces the Department's intent to provide relief 
to those whose eligibility or rental payments under HUD's assisted 
rental housing programs were adversely affected by counting reparation 
payments as family income.

    Dated: March 30, 1995.
Henry G. Cisneros,
Secretary.
[FR Doc. 95-10087 Filed 4-24-95; 8:45 am]
BILLING CODE 4210-32-P