Source: https://www.federalregister.gov/documents/2002/04/09/02-8528/guaranteed-rural-rental-housing-program
Timestamp: 2017-09-23 20:22:17
Document Index: 191880192

Matched Legal Cases: ['art 11', 'art 3015', 'art 3565', '§\u20093565', '§\u20093565', '§\u20093565']

A Rule by the Rural Housing Service on 04/09/2002
16969-16971 (3 pages)
0575-AC26
https://www.federalregister.gov/d/02-8528 https://www.federalregister.gov/d/02-8528
The Rural Housing Service (RHS) is amending its regulations for the Guaranteed Rural Rental Housing Program (GRRHP). The Housing Act of 1949, which authorizes RHS to administer GRRHP, was amended on December 27, 2000. The intended effect of this final rule change is limited to the implementation of five statutory changes. The revisions range from adding a definition of an “Indian tribe” to authorizing loans to be made for 25 years with an amortization of 40 years (i.e., balloon payments).
Douglas H. MacDowell, Senior Loan Specialist, Multi-Family Housing Processing Division, Rural Housing Service, U.S. Department of Agriculture, STOP 0781, 1400 Independence Avenue SW., Washington, DC 20250-0781, Telephone (202) 720-1604.
The information collection requirements contained in this regulation have been previously approved by OMB under the provisions of 44 U.S.C. chapter 35 and this regulation has been assigned OMB control number 0575-0174, in accordance with the Paperwork Reduction Act of 1995. This rule does not impose any new information collection requirements from those approved by OMB.
This rule has been reviewed under Executive Order 12988, Civil Justice Start Printed Page 16970Reform. In accordance with this Executive Order: (1) All state and local laws and regulations that are in conflict with this rule will be preempted; (2) no retroactive effect will be given to this rule; and (3) administrative proceedings in accordance with 7 CFR part 11 must be exhausted before bringing suit in court challenging action taken under this rule.
For the reasons contained in the notice related to 7 CFR part 3015, subpart V this program is not subject to Executive Order 12372 which requires intergovernmental consultation with state and local officials.
This rule has been reviewed with regard to the requirements of the Regulatory Flexibility Act (5 U.S.C. 601-612). The undersigned has determined and certified by signature of this document that this rule will not have a significant economic impact on a substantial number of small entities since this rulemaking action does not involve a new or expanded program nor does it require any more action on the part of a small business than a large entity.
GRRHP has been designed to increase the availability of affordable multifamily housing in rural areas. Qualified lenders are authorized to originate, underwrite, and close loans for multifamily housing projects guaranteed under this program. Projects may be for new construction or acquisition with substantial rehabilitation of at least $15,000 per unit. RHS guarantees such loans upon review of the lender's underwriting package, appraisal report, appropriate certifications, project information, and satisfactory completion of the appropriate level of environmental review by the Agency. Lenders are expected to provide servicing or contract for servicing of each loan it underwrites. Loans which are guaranteed may not exceed 90% of the total development cost of a project. This leaves 10% of the total development cost that must be provided from other sources. The guarantee itself is then limited to 90% of the loan amount.
GRRHP is a relatively new program which was operated as a pilot program by RHS in 1996 and 1997 and as a permanent program since. During the early stages of the program, RHS identified barriers in the program's authorizing statute (section 538 of the Housing Act of 1949) that limited the success of the program.
Congress subsequently addressed these barriers in the American Homeownership and Economic Act of 2000 (Pub. L. 106-569). This regulation incorporates those statutory changes by (1) defining “Indian tribe”, (2) outlining how to handle loan defaults on reservations, (3) authorizing guaranteed loans with repayment terms of not less than 25 nor greater than 40 years, and (4) removes the restriction on releasing borrowers from liability.
This final rule is limited to the implementation of the statutory changes made on December 27, 2000. The Agency has no discretion implementing these changes. Notice and public comment, therefore, are impractical, unnecessary, and contrary to the public interest.
Therefore, chapter XXXV, title 7, Code of Federal Regulations, part 3565 is amended as follows:
2. Section 3565.3 is amended by adding, in alphabetical order, a definition of “Indian tribe.”
3. Section 3565.209 is revised to read as follows:
Start Printed Page 16971
§ 3565.209
§ 3565.214
4. Section 3565.214 is removed and reserved.
5. Section 3565.403(b)(2) is amended by removing the last sentence.
6. Section 3565.452 is revised to read as follows:
(a) A decision to liquidate shall be made when it is determined that the default cannot be cured through actions contained in § 3565.403 of subpart I or it has been determined that it is in the best interest of the Agency and the lender to liquidate.
[FR Doc. 02-8528 Filed 4-8-02; 8:45 am]