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###### Department of Housing and Urban Development

          - 24 CFR Parts 201 and 203
          - [Docket No. FR-5075-N-02]
          - RIN 2502-AI45

# AGENCY:

Office of the Assistant Secretary for Housing—Federal Housing Commissioner, HUD.

# ACTION:

Proposed rule; reopening of public comment period.

# SUMMARY:

On September 15, 2008, HUD published a proposed rule entitled “Federal Housing Administration: Insurance for Manufactured Housing.” The comment period for the proposed rule ended on November 14, 2008. This notice identifies an additional issue related to the rule that has resulted from HUD's implementation of a June 2008 final rule pertaining to the federal manufactured home installation program. Accordingly, HUD reopens the comment period for the proposed rule to present this additional issue for consideration in relation to the September 2008 proposed rule and to solicit public comment only on this additional issue.

# DATES:

*Comment Due Date:*                         March 8, 2010.                    

# ADDRESSES:

Interested persons are invited to submit comments regarding this proposed rule to the Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 7th Street, SW., Room 10276, Washington, DC 20410-0500. There are two methods for submitting public comments. All submissions must refer to the above docket number and title.

                        1.                         *Submission of Comments by Mail.*                         Comments may be submitted by mail to the Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 7th Street, SW., Room 10276, Washington, DC 20410-0001.                    

                        2.                         *Electronic Submission of Comments.*                         Interested persons may submit comments electronically through the Federal eRulemaking Portal at                         *http://www.regulations.gov.*                         HUD strongly encourages commenters to submit comments electronically. Electronic submission of comments allows the commenter maximum time to prepare and submit a comment, ensures timely receipt by HUD, and enables HUD to make them immediately available. Comments submitted electronically through the                         *http://www.regulations.gov*                         Web site can be viewed by other commenters and interested members of the public. Commenters should follow the instructions provided on that site to submit comments electronically.                    

# Note:

To receive consideration as public comments, comments must be submitted through one of the two methods specified above. Again, all submissions must refer to the docket number and title of the rule.

*No Facsimile Comments.*                     Facsimile (FAX) comments are not acceptable.                

*Public Inspection of Public Comments.*                     All properly submitted comments and communications submitted to HUD will be available for public inspection and copying between 8 a.m. and 5 p.m. weekdays at the above address. Due to security measures at the HUD Headquarters building, an advance appointment to review the public comments must be scheduled by calling the Regulations Division at 202-708-3055 (this is not a toll-free number). Individuals with speech or hearing impairments may access this number via TTY by calling the Federal Information Relay Service at 800-877-8339. Copies of all comments submitted are available for inspection and downloading at                     *http://www.regulations.gov.*

# FOR FURTHER INFORMATION CONTACT:

Peter Gillispie, Home Valuation Policy Division, Office of Housing, Department of Housing and Urban Development, 451 7th Street, SW., Room 9270, Washington, DC 20410-8000, telephone number 202-708-2121 (this is not a toll-free number). Individuals with speech or hearing impairments may access this number through TTY by calling the toll-free Federal Information Relay Service at 800-877-8339.

# SUPPLEMENTARY INFORMATION:

HUD published a proposed rule on September 15, 2008 (73 FR 53346), that would amend HUD's regulations governing manufactured homes that are to be the security for Federal Housing Administration (FHA) Title I-insured loans and Title II-insured mortgages. The September 15, 2008 rule proposed to permit, as eligible for FHA insurance, mortgages on manufactured homes to be installed in accordance with the Model Installation Standards, which were the subject of notice and rulemaking that resulted in a final rule published on October 19, 2007. Current regulations provide that manufactured homes that are to be the security for FHA Title I-insured loans must be installed in accordance with the manufacturer's requirements or erected on a permanent foundation, and manufactured homes that are to be the security for Title II-insured mortgages must be erected on a permanent foundation. Acceptance of mortgages on manufactured homes installed in accordance with the Model Installation Standards would provide for greater flexibility of design, thereby permitting additional options for affordable housing. Under the proposal presented by the September 15, 2008 proposed rule, FHA mortgage insurance would become available for eligible manufactured homes in all states and territories, upon promulgation of a final rule.

                    On June 20, 2008, HUD published a final rule entitled “Manufactured Home Installation Program,” which established a federal manufactured home installation program in accordance with the National Manufactured Housing Construction and Safety Standards Act of 1974, as amended by the Manufactured Housing Act of 2000. The June 20, 2008, final rule governs the HUD-administered installation program that will operate in a state, unless that state certifies that it has its own qualifying program and HUD reviews the program and accepts it as meeting or exceeding the requirements HUD would apply in a HUD-administered state. The June 20, 2008 final rule also provides for HUD's conditional acceptance, rather than full acceptance, of a state program that meets some but not all of the minimum standards. However, there have been some delays in submissions of state certifications, in HUD's review and acceptance of state certifications, and in implementation of HUD's                           ( print page 5707)                        program for states in which HUD will administer the installation program. As a result, there are several states in which there is not yet either a state-certified and fully accepted installation program or an operational HUD-administered installation program.                

HUD has determined that, in order to protect against undue financial risk, a manufactured home that is installed in accordance with the Model Installation Standards (rather than erected on a permanent foundation) should not be permitted to be the security for FHA Title I-insured loans or Title II-insured mortgages, until there is operating in the state where the manufactured home is located either a state-certified and fully accepted installation program or a HUD-administered installation program. (This determination does not affect the eligibility of manufactured homes to be the security for Title I-insured loans if the manufacturer's installation requirements provide for compliance with the Model Installation Standards and the manufactured home is in fact installed with the Model Installation Standards.) An operational and fully compliant installation program is critical to ensure that a manufactured home that is to be the security for a Title I-insured loan or Title II-insured mortgage is in fact installed in accordance with the Model Installation Standards.

As a result, HUD submits that it would not be appropriate to promulgate a final rule based on the September 15, 2008 proposed rule, which assumed fully compliant installation programs would be operational in all states and territories, that does not take into consideration the implementation issues that have resulted from the June 2008 final rule. HUD submits for consideration and public comment that it would be appropriate for manufactured homes in a state with an operational state-certified and fully accepted installation program, or HUD-administered installation program, to be eligible for Title I and Title II insurance, even while review, full acceptance, or implementation of installation programs in other states and territories still is pending.

Accordingly, HUD is soliciting public comment on whether HUD should: (a) Promulgate a final rule based on the September 15, 2008 proposed rule, but that is applicable to a state only at such time that the state has an operational state-certified and fully accepted installation program or a HUD-administered installation program; or (b) delay promulgation of a final rule based on the September 15, 2008 proposed rule until all states and territories have an operational state-certified and fully accepted installation program or a HUD-administered installation program.

Dated: January 27, 2010.

David H. Stevens,

Assistant Secretary for Housing—Federal Housing Commissioner.

[FR Doc. 2010-2367 Filed 2-3-10; 8:45 am]

BILLING CODE 4210-67-P