Spreadsheet: c46b8612-c891-4aae-92d9-7630cbb90abd
Sheet: Environmental-CH.9

[NAME] | ANSWER | Last Updated
Other then the Items contained within 8-11 of the HUD 232/223f checklist are there are any other requirements on the 232 LEAN side that would prohibit a project located within the 100 year flood? | According to 24 CFR Part 55.11, HUD is not prohibited from providing mortgage insurance for a critical action (232) that is within the 100-year floodplain, as long as it is not in a high hazard area. However before an application can be approved it must go through the decision making process outlined in 24 CFR 55.20 (8-step review).  For refinances without renovations or new construction, 24 CFR 55.12 allows for a modified 8-step review.  We are allowed to proceed once we establish an acceptable plan to safeguard the residents. | 2012-02-01 00:00:00
Does LEAN allows the Lender to do the 8 step process, or do you have to do the publications, etc.?  I recognize the guidelines discourage Healthcare facilities in flood plains, however it is very difficult, in some parts of the country, to find sites that are outside of a flood plain.  Is it possible for the lender to identify the methodology and possible acceptance of this development by HUD in advance of engaging the various third parties and the resultant expenditures.    What we’re questioning is whether we can do the 8 step review in advance of the application, essentially clearing this objection beforehand.  The stakes are quite high here and we don’t want to have the Sponsors’ start the Good Faith deposit on the land, preliminary site engineering, etc., with this potential fatal flaw looming, if possible. | Unfortunately, given our limited staffing resources, we will only make one trip to each new construction site – to do the environmental, market review, and appraisal review.    If a Firm Commitment application (or Initial Submittal of Firm) is submitted, we may do the appraisal/environmental review while the project is in the queue.  If you do submit, please email LEAN Thinking indicating that an 8 step review is needed and the project is in the queue (need project name and FHA Number).   Lenders can prepare draft 8-step documents, etc. however, HUD would need to approve the language that goes into the publication.  HUD must also approve the specific publication…and of course the Lender would pay the cost of the publication.  But HUD will still have to do the final approval, and likely would not be in advance of your application submission or full underwriting review. | 2012-02-01 00:00:00
Are modified 8-step reviews required on 223 (a)7s? | It depends.  If a Special Flood Hazard Area, 500-year floodplain or floodway was established after the last HUD application, then HUD would need to do a modified 8 step.  If the Special Flood Hazard Area, 500-year floodplain or floodway was in place before the last HUD loan was approved, then no – but we may add special conditions to the Firm Commitment. | 2012-02-01 00:00:00
Is a State Historic Preservation Office (SHPO) letter required if the property is not eligible for National Historic Register? | A letter to the SHPO is required whenever a project involves repairs, improvements, new construction, additions, or ground disturbance. Exemptions: Refinances of existing projects that will not result in any physical impacts or changes to the building or grounds do not require SHPO consultation. | 2012-02-01 00:00:00
Are 4128s required of the lender completing a 232 application? | It is not required; however, including the draft will assist HUD in completing the analysis in a timely manner. | 2012-02-01 00:00:00
The 232/223(a)7 checklist lists requests a “draft 4128”.  Is this required? | It would be a rare 223a7 where a 4128 is required – see the below endnote from the checklist:  4  A draft from HUD-4128 is only required if proposed repairs will increase building footprint(s) or impervious surfaces. | 2012-04-01 00:00:00
If it has been determined that a property was built under a building code whose seismic requirements exceed that of the HUD minimum standards, is a seismic analysis required or possibly a statement from the engineer that it is covered by the building code? | A seismic hazard analysis is not required when an engineer determines the applicable code requirements at the time of construction equals or exceeds the HUD seismic standard.  An affirmative statement would need to be provided.  Currently under the LEAN Section 232 program, we do not require a seismic analysis on all refinance/purchase loans.  However, even if the applicable code is equal to or more strict than HUD’s current standard, and you see seismic issues that are of concern, I would not discourage you, as the expert in the field, from making a seismic analysis recommendation to the Lender. | 2012-02-01 00:00:00
In the January 25, 2011 e-mail blast regarding “Above-Ground Storage Tanks” it states that Section 232 applications need to obtain conformance letters from the governing fire department/district, etc. It further states that should you be unable to obtain a letter, you need to calculate the Acceptable Separation Distance (ASD). | In most cases the environmental reviews are not required for 223(a)(7) loans. The logic is that they are already in our portfolio and the reviews were done in the past. So unless you are adding land or planning an addition the AST calculations will not be necessary. | 2012-02-01 00:00:00
We have a borrower whose site is located within the 500 year flood plain.  Can you please provide me with the guidelines for developing a health care facility (ALF) within a 500-year flood plain and what documentation would be required in order for OHP to make a determination on whether to allow development within a 500-year flood plain. | All Section 232 projects are considered “critical actions” as defined in 24 CFR 55.2(b)(2).  New construction under Section 232 in mapped 100-year and 500-year floodplains is strongly discouraged.  HUD must determine if there may be extraordinary circumstances which lead to the conclusion that there are no practicable alternatives to the project site being in the floodplain.  If so, then it must conduct an 8-step decision making process which includes publishing two public notices and taking comments, as summarized in 24 CFR 55.20.    Prior to issuing the first public notice, HUD will require detailed information about how the property will be altered and improvements designed. This information includes the elevation of the property, the elevation of the floodplain, and the location of life support systems. In addition, evidence that the project will satisfy the following requirements of Step 5 of the 8-step process, 24 CFR 55.20(e), must be provided to HUD.  As required by 24 CFR 55.20(e), all critical actions in the 500-year floodplain shall be designed and built at or above the 100-year floodplain (in the case of new construction) and modified to include: i. Preparation of and participation in an early warning system; ii. An emergency evacuation and relocation plan; iii. Identification of evacuation route(s) out of the 500-year floodplain; and iv. Identification marks of past or estimated flood levels on all structures. The 8-step process shall be completed before issuance of the Firm Commitment.  HUD will develop the two notices, but the costs of publication will be borne by the borrower.   At the time of the application for Firm Commitment, the Lender is required to submit a completed Standard Flood Hazard Determination Form (FEMA Form 81-93). All leases (new and renewal) must contain acknowledgements signed by tenants indicating that they have been advised that the property is in a floodplain and flood insurance is available for their personal property. This applies to properties within the 100-year floodplain and to critical actions within the 500-year floodplain. | 2012-04-01 00:00:00
Is flood insurance required for projects in the 500 year flood plain? | Flood insurance is not required in the 500-year floodplain.  In this respect the Section 232 is the same as the Multifamily Housing Programs. Where we differ is that the Section 232 Program  will require evacuation plans, high water marks, participation in early warning systems, and tenant notifications in the 500-year floodplain.  Those instructions are part of the Lender Narrative, which is part of the mortgage insurance application process. | 2013-03-01 00:00:00