[Federal Register Volume 65, Number 77 (Thursday, April 20, 2000)]
[Proposed Rules]
[Pages 21288-21290]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-9929]



[[Page 21287]]

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Part IV





Department of Housing and Urban Development





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24 CFR Part 1000



Revision to Cost Limits for Native American Housing; Proposed Rule

Federal Register / Vol. 65, No. 77 / Thursday, April 20, 2000 / 
Proposed Rules

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 1000

[Docket No. FR-4517-P-01]
RIN 2577-AC14


Revision to Cost Limits for Native American Housing

AGENCY: Office of Public and Indian Housing, HUD.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would revise the way construction costs are 
controlled in the Indian Housing Block Grant (IHBG) program 
administered by IHBG grantees, who are Indian Tribes or their Tribally 
Designated Housing Entities (TDHEs). It would replace the system of 
HUD-established Dwelling Construction and Equipment costs with a choice 
between HUD-established Total Development Costs or standards 
established by the TDHE based on standards in its geographic area. This 
rule also would provide that the construction, acquisition, or 
assistance of non-dwelling buildings is either subject to standards 
established by the TDHE or to documentation of comparability to the 
size, design and amenities of similar buildings constructed in the 
geographic area.

DATES: Comments Due Date: June 19, 2000.

ADDRESSES: Interested persons are invited to submit comments regarding 
this proposed rule to the Regulations Division, Office of General 
Counsel, Room 10276, Department of Housing and Urban Development, 451 
Seventh Street, SW, Washington, DC 20410-0500. Communications should 
refer to the above docket number and title. Facsimile (FAX) comments 
are not acceptable. A copy of each communication submitted will be 
available for public inspection and copying between 7:30 a.m. and 5:30 
p.m. weekdays at the above address.

FOR FURTHER INFORMATION CONTACT: Bruce Knott, Office of Native American 
Programs, at 303-675-1600, extension 3302, or email him at the 
following address: <a href="/cdn-cgi/l/email-protection" class="__cf_email__" data-cfemail="81c3f3f4e2e4dedec0afdedecaefeef5f5c1e9f4e5afe6eef7">[email protected]</a>. Persons with hearing or 
speech impairments may access the above telephone number via TTY by 
calling the Federal Information Relay Service at 1-800-877-8339.

SUPPLEMENTARY INFORMATION:

Reason for the Proposed Change

    Under the United States Housing Act of 1937 (``1937 Act'') (42 
U.S.C. 1437 et seq.), the construction cost limits were called Total 
Development Cost limits, informally referred to as TDCs. These limits 
included the total cost of development, including both soft and hard 
costs of construction.
    Under the Native American Housing Assistance and Self-Determination 
Act (NAHASDA)(25 U.S.C. 4101 et seq.), the new regulations provided for 
a new system of construction cost limits called Dwelling Construction 
and Equipment costs, also referred to as DC&Es (see 24 CFR 1000.156). 
In response to concerns expressed by tribes, the negotiated rule making 
(neg reg) committee designed DC&Es to begin from the same base design 
as TDCs, but limit only the hard costs of construction within five feet 
of the foundation, believing this would provide more flexibility in 
resolving unusual site cost issues. When tribes/TDHEs actually began 
utilizing DC&Es, they found them to be a barrier in providing housing 
as many tribes had historically used part of the soft cost allocation 
for the actual construction; therefore, when the cost limits included 
money for only the hard costs, the limits were inadequate.
    In response to these new concerns, the National Office of Native 
American Programs (NONAP) began working with a tribal consulting group 
on the cost limit issue in the fall of 1998. This group was comprised 
of a tribal representative from each of the ONAP office jurisdictions, 
one HUD field staff person, and two HUD Headquarters staff. Their 
objective was to write language that incorporated both the self 
determination and affordable housing intentions of NAHASDA. This group 
wrote proposed changes for dwelling cost limits. This language was 
mailed to tribes and TDHEs for consultation in January, 1999. This 
group then wrote non dwelling cost limits and mailed them to tribes/
TDHEs for consultation in April, 1999. The rule reflects comments 
received during the consultation and during HUD's clearance process.

Implications

    If these proposed changes are adopted in substantially the same 
form as below, the Department will publish TDCs, instead of the present 
DC&Es. The tribes/TDHEs will choose whether to use the published TDCs, 
or develop their own standards, consistent with this rule.

Findings and Certifications

Public Reporting Burden

    The Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) does not 
apply to the proposed information collection requirements contained in 
Secs. 1000.158 and 1000.162 because HUD anticipates that the 
requirements will apply to fewer than 10 TDHEs.

Consultation With Indian Tribal Governments

    In accordance with Executive Order 13084, Consultation and 
Coordination With Indian Tribal Governments, issued on May 14, 1998, 
the Department has consulted with representatives of tribal governments 
concerning the subject of this rule. As described above, the rule 
originated from concerns brought to our attention by tribal 
representatives. In accordance with that Executive Order, the docket 
file for this rulemaking contains copies of written communications 
submitted to HUD by tribal governments.

Impact on Small Entities

    The Regulatory Flexibility Act (5 U.S.C. 601-612) requires that an 
agency analyze the impact of a rule on small entities whenever it 
determines that the rule is likely to have a significant impact on a 
substantial number of small entities. While many TDHEs may be small 
entities, the effect of this rule developed in consultation with tribal 
representatives, will not be likely to have a significant impact on a 
substantial number of them. As mentioned above, it is expected that 
fewer than 10 TDHEs will be affected by this rule. To the extent that 
small entities will be affected, the impact is expected to be 
beneficial, as a result of the consultation that has taken place. We 
encourage small entities to submit comments, however, on ways that the 
impact of the rule on them could be minimized.

Environmental Impact

    A Finding of No Significant Impact with respect to the environment 
has been made in accordance with HUD regulations at 24 CFR part 50, 
which implement section 102(2)(C) of the National Environmental Policy 
Act of 1969. 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 at the address stated above.

Federalism Impact

    The General Counsel, as the Designated Official under section 6(a) 
of Executive Order 13132, Federalism, has determined that this rule 
does not impose substantial direct compliance costs on States or local 
governments or preempt State law within the meaning of the Executive 
Order. As a result, the

[[Page 21289]]

rule is not subject to review under the order.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1532) 
establishes requirements for Federal agencies to assess the effects of 
their regulatory actions on State, local, and tribal governments and 
the private sector. This proposed rule does not impose a Federal 
mandate that will result in the expenditure by State, local, or tribal 
governments in the aggregate, or by the private sector, of $100 million 
or more in any one year.

Regulatory Review

    The Office of Management and Budget (OMB) has reviewed this 
proposed rule under Executive Order 12866, Regulatory Planning and 
Review, issued by the President on September 30, 1993. OMB determined 
that this rule is a ``significant regulatory action'' as defined in 
section 3(f) of the Order (although not an economically significant 
regulatory action under the Order). Any changes made in this proposed 
rule after its submission to OMB are identified in the docket file, 
which is available for public inspection during regular business hours 
in the Regulations Division, Office of General Counsel, Room 10276, 
U.S. Department of Housing and Urban Development, 451 Seventh Street, 
SW, Washington, DC 20410.

Catalog

    The Catalog of Federal Domestic Assistance number for this program 
is 14.867.

List of Subjects in 24 CFR Part 1000

    Aged, Community development block grants, Grant programs--housing 
and community development, Grant programs--Indians, Indians, 
Individuals with disabilities, Low and moderate income housing, 
Reporting and recordkeeping requirements.
    Accordingly, HUD proposes to amend part 1000 of title 24 of the 
Code of Federal Regulations as follows:

PART 1000--NATIVE AMERICAN HOUSING ACTIVITIES

    1. The authority citation for part 1000 continues to read as 
follows:

    Authority: 25 U.S.C. 4101 et seq.; 42 U.S.C. 3535(d).

    2. Revise Sec. 1000.156 to read as follows:


Sec. 1000.156  Is affordable housing developed, acquired, or assisted 
under the IHBG program subject to limitations on cost or design 
standards?

    Yes. Affordable housing must be of moderate design. For these 
purposes, moderate design is defined as housing that is of a size and 
with amenities consistent with unassisted housing offered for sale in 
the Indian tribe's general geographic area to buyers who are at or 
below the area median income. The local determination of moderate 
design applies to all housing assisted under an affordable housing 
activity, including development activities (e.g., acquisition, new 
construction, reconstruction, moderate or substantial rehabilitation of 
affordable housing and homebuyer assistance) and model activities. 
Acquisition includes assistance to a family to buy housing.
    3. Add new Secs. 1000.158, 1000.160, and 1000.162 to read as 
follows:


Sec. 1000.158  How will a NAHASDA grant recipient know that the housing 
assisted under the IHBG program meets the requirements of 
Sec. 1000.156?

    (a) A recipient must use one of the methods specified in paragraph 
(b) or (c) of this section to determine if an assisted housing project 
meets the moderate design requirements of Sec. 1000.156. For purposes 
of this requirement, a project is one or more housing units, of 
comparable size and design, developed with assistance provided by the 
Act.
    (b) The recipient may adopt written standards for its affordable 
housing programs that reflect the requirement specified in 
Sec. 1000.156. The standards must describe the type of housing, explain 
the basis for the standards, and use similar housing in the Indian 
tribe's general geographic area. Units with the same number of bedrooms 
within a project must be comparable with respect to size, cost, and 
amenities. For each affordable housing project, the recipient must 
maintain documentation substantiating compliance with the adopted 
housing standards. The standards and documentation substantiating 
compliance for each activity must be available for review by the 
general public and, upon request, by HUD. Prior to awarding a contract 
for the construction of housing or beginning construction using its own 
workforce, the recipient must complete a comparison of the cost of 
developing or acquiring/rehabilitating the affordable housing with the 
limits provided by the TDC discussed in paragraph (c) of this section 
and may not, without prior HUD approval, exceed by more than 10 percent 
the TDC maximum cost for the project. In developing standards under 
this paragraph, the recipient must establish, maintain, and follow 
policies that determine a local definition of moderate design which 
considers:
    (1) Gross area;
    (2) Total cost to provide the housing;
    (3) Environmental concerns and mitigations;
    (4) Climate;
    (5) Comparable housing in geographical area;
    (6) Local codes, ordinances and standards;
    (7) Cultural relevance in design;
    (8) Design and construction features that are reasonable, and 
necessary to provide decent, safe, sanitary and affordable housing; and
    (9) Design and construction features that are accessible to persons 
with a variety of disabilities.
    (c) If the recipient has not adopted housing standards specified in 
paragraph (b) of this section, Total Development Cost (TDC) limits 
published periodically by HUD establish the maximum amount of funds 
(from all sources) that the recipient may use to develop or acquire/
rehabilitate affordable housing. The recipient must complete a 
comparison of the cost of developing or acquiring/rehabilitating the 
affordable housing with the limits provided by the TDC and may not, 
without prior HUD approval, exceed the TDC maximum cost for the 
project.


Sec. 1000.160  Are non-dwelling buildings developed, acquired or 
assisted under the IHBG program subject to limitations on cost or 
design standards?

    Yes. Non-dwelling buildings must be of a design, size and with 
features or amenities that are reasonable and necessary to accomplish 
the purpose intended by the buildings. The purpose of a non-dwelling 
building must be to support an affordable housing activity, as defined 
by the Act. These limits apply to buildings such as community 
facilities and office space; they do not apply to structures related to 
utilities or power supply.


Sec. 1000.162  How will a recipient know that non-dwelling buildings 
assisted under the IHBG program meet the requirements of 1000.160?

    (a) The recipient must use one of the methods described in 
paragraph (b) or (c) of this section to determine if a non-dwelling 
building meets the limitation requirements of Sec. 1000.160. If the 
recipient develops, acquires, or rehabilitates a non-dwelling building 
with combined funds (from NAHASDA and other sources), then the cost 
limit standard established under these regulations applies to the 
combined

[[Page 21290]]

activity. If funds are being combined from two different sources, the 
standards of the funding source with the more restrictive rules apply.
    (b)(1) The recipient may adopt written standards for non-dwelling 
buildings. The standards must describe the type of building and must 
clearly describe the criteria to be used to guide the cost, size, 
design, features, amenities, performance or other factors. The 
standards for such buildings must be able to support the reasonableness 
and necessity for these factors and to clearly identify the affordable 
housing activity that is being provided.
    (2) When the recipient applies a standard to a particular building, 
it must document the following:
    (i) Identification of targeted population to benefit from the 
building;
    (ii) Identification of need or problem to be solved;
    (iii) Affordable housing activity provided or supported by the 
building;
    (iv) Alternatives considered;
    (v) Provision for future growth and change;
    (vi) Cultural relevance of design;
    (vii) Size and scope supported by population and need;
    (viii) Design and construction features that are accessible to 
persons with a variety of disabilities;
    (ix) Cost; and
    (x) Compatibility with community infrastructure and services.
    (c) If the recipient has not adopted building program standards 
specified in paragraph (b) of this section, then it must demonstrate 
and document that the non-dwelling building is of a cost, size, design 
and with amenities consistent with similarly designed and constructed 
buildings in the recipient's general geographic area.

    Dated: March 27, 2000.
Harold Lucas,
Assistant Secretary for Public and Indian Housing.
[FR Doc. 00-9929 Filed 4-19-00; 8:45 am]
BILLING CODE 4210-33-P


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