[Federal Register Volume 59, Number 131 (Monday, July 11, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-16639]


[[Page Unknown]]

[Federal Register: July 11, 1994]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of the Secretary

24 CFR Part 791

[Docket No. R-94-1728; FR-3658-I-01]
RIN 2501-AB71

 

Allocation of Budget Authority for Housing Assistance

AGENCY: Office of the Secretary, HUD.

ACTION: Interim rule.

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SUMMARY: This interim rule amends the Department's existing regulations 
on allocation of budget authority for housing assistance to provide 
greater flexibility in the provision of housing assistance under the 
Headquarters Reserve authorized under section 213(d)(4) of the Housing 
and Community Development Act of 1974, as amended.

DATES: Effective date: August 10, 1994.
    Comment due date: September 9, 1994.

ADDRESSES: Interested persons are invited to submit comments regarding 
this interim rule to the Rules Docket Clerk, Office of General Counsel, 
Room 10276, Department of Housing and Urban Development, 451 Seventh 
Street, SW., Washington, DC 20410. Communications should refer to the 
above docket number and title. A copy of each communication submitted 
will be available for public inspection during regular business hours 
at the above address.

FOR FURTHER INFORMATION CONTACT: For the Public and Indian Housing 
program, and section 8 voucher, certificate, and moderate 
rehabilitation programs, William R. Minning, Director, Policy Division, 
Room 4234, Department of Housing and Urban Development, 451 Seventh 
Street, SW., Washington, DC 20410-0500, telephone (202) 708-0713. 
Hearing- or speech-impaired individuals may call HUD's TDD number (202) 
708-0850.
    For other assisted housing programs, Margaret Milner, Acting 
Director, Office of Elderly and Assisted Housing, Room 6130, Department 
of Housing and Urban Development, 451 Seventh Street, SW., Washington, 
DC 20410-8000, telephone (202) 708-4542. Hearing- or speech-impaired 
individuals may call HUD's TDD number (202) 755-4594. (These are not 
toll-free numbers.)

SUPPLEMENTARY INFORMATION:

I. Background

    This interim rule further implements section 213(d) of the Housing 
and Community Development Act of 1974, as amended, 42 U.S.C. 1439(d), 
so as to maximize flexibility in the provision of the Headquarters 
Reserve authorized under section 213(d)(4) of the Act.
    Section 213(d)(4) permits the Secretary of HUD to retain not more 
than five percent of the financial assistance that becomes available 
under all programs authorized under the United States Housing Act of 
1937 (except for public housing operating subsidy under section 9 and 
modernization funding under section 14). However, the current 
regulation implementing the Headquarters Reserve at Sec. 791.407 is 
more delimited. It only permits a Headquarters Reserve of five percent 
of the total amount of budget authority which is ``fair shared'' 
pursuant to Part 791, Subpart D. The effect of the regulatory 
limitation is to narrow considerably the base upon which the five 
percent reserve is calculated, as compared to what the statute permits.
    Under this interim rule, the base would be expanded by including 
not only the amount of funding which is fair shared pursuant to the 
formula at Sec. 791.403(b)(2), but also all budget authority allocated 
for uses that the Secretary determines are incapable of geographic 
formula, as spelled out at Sec. 791.403(b)(1). Examples of the latter 
category include amendments of existing contracts, renewals of 
assistance contracts, the section 8 loan management and property 
disposition accounts, assistance earmarked by the Congress in 
appropriation law line items, and uses of budget authority identified 
in the Department's Operating Plan submitted to the Appropriations 
Committee.
    Although the amount of funding available under the Headquarters 
Reserve will be increased by this interim rule, the limited statutory 
purposes for which funding is permissible are maintained. Reserve 
funding can only be used for unforeseen housing needs resulting from 
natural and other disasters; housing needs resulting from emergencies, 
as certified by the Secretary, other than such disasters; housing needs 
resulting from the settlement of litigation; and housing in support of 
desegregation efforts.
    The tragedies of recent disasters are a highly visible predicate 
for this interim rule. The confluence in 1993 of Hurricane Andrew, 
Hurricane Iniki, and Typhoon Omar and this year the Northridge 
earthquake in California have placed substantial pressure on the 
Department to provide prompt, efficient assisted housing relief for 
disaster victims.
    Further, the Department finds itself involved in longstanding 
litigation for which equitable resolution frequently requires the 
delivery of housing assistance in order to achieve fair, reasonable 
settlement. Expanding the ranging of the Headquarters Reserve will 
facilitate handling these unpredictable pressures for disaster relief 
and litigation settlements, as well as for emergencies.
    Precisely because the incidence of these types of housing 
assistance funding are unpredictable, the availability of readier 
resources through an increased Reserve is one which HUD will only call 
upon as needed. That is, although a greater amount of budget authority 
will be made available under this interim rule than is the case under 
the current regulation, this does not mean that HUD will use the full 
statutory maximum in this year or any year. The draw upon the Reserve 
will be carefully tempered to exigencies and real, immediate need.
    HUD notes that the basis upon which the five percent can be 
calculated does not include the section 202 program of supportive 
housing for the elderly. Section 801(b) of the Cranston-Gonzalez 
National Affordable Housing Act (NAHA) removed the section 202 program 
from coverage under section 213(d). However, NAHA did not repeal a 
previous amendment to section 213(d)(1)(A)(i) made by section 101 of 
the Department of Housing and Urban Development Reform Act of 1989. 
This amendment requires that section 202 assistance be allocated in a 
manner that ensures that awards of that assistance are made for 
projects of sufficient size to accommodate facilities with supportive 
services appropriate to the needs of frail elderly residents. Moreover, 
the Department has elected to continue the fair sharing of section 202 
housing assistance in order to promote fair and balanced geographic 
diversity. (The fair sharing formula for section 202 assistance is 
specifically tailored at Sec. 791.402(c)(1) to reflect relevant 
characteristics of the elderly population.) Notwithstanding this 
retention of section 202 allocations in part 791, the statutory range 
for calculation of the five percent Headquarters Reserve is now 
effectively limited to programs under the United States Housing Act of 
1937 which are covered by section 213(d). Therefore, the revision to 
Sec. 791.407 under this interim rule limits--for calculation purposes--
the Reserve to five percent under those 1937 Act programs.

II. Other Matters

A. Regulatory Flexibility Act

    The Secretary, in accordance with the Regulatory Flexibility Act (5 
U.S.C. 605(b)), has reviewed and approved this interim rule, and in so 
doing certifies that this interim rule does not have a significant 
economic impact on a substantial number of small entities. The interim 
rule revises existing procedures for the allocation of housing 
assistance funds and for local government and HUD review of 
applications for housing assistance, but will make no change in the 
economic impact of these procedures on small entities.

B. Environmental Impact

    In accordance with 40 CFR 1508.4 of the regulations of the Council 
on Environmental Quality and 24 CFR 50.20(k) of the HUD regulations, 
the policies and procedures contained in this interim rule relate only 
to internal administrative procedures whose content does not constitute 
a development decision nor affect the physical condition of project 
areas or building sites, and therefore, are categorically excluded from 
the requirements of the National Environmental Policy Act.

C. Executive Order 12612, Federalism

    The General Counsel, as the Designated Official under section 6(a) 
of Executive Order 12612, Federalism, has determined that the policies 
contained in this interim rule will 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. 
Specifically, this interim rule will not substantially alter the 
established roles of HUD and the States and local governments, 
including PHAs, in administering the affected programs. As a result, 
the interim rule is not subject to review under the Order.

D. Executive Order 12606, The Family

    The General Counsel, as the Designated Official under Executive 
Order 12606, The Family, has determined that this interim rule 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. No significant change in existing HUD policies or programs will 
result from promulgation of this interim rule, as those policies and 
programs relate to family concerns.

E. Regulatory Agenda

    This interim rule was listed as item 1550 in the Department's 
Semiannual Agenda of Regulations published on April 25, 1994 (59 FR 
20424, 20440), in accordance with Executive Order 12866 and the 
Regulatory Flexibility Act.

F. The Catalog of Federal Domestic Assistance Program Numbers Are as 
Follows

14.156  Lower Income Housing Assistance Program (Section 8)
14.157  Housing for the Elderly or Handicapped
14.177  Housing Voucher Program
14.850  Public and Indian Housing
14.851  Low-Income Housing--Homeownership Opportunities for Low-
Income Families

G. Justification for Interim Rulemaking

    In general, the Department publishes a rule for public comment 
before issuing a rule for effect, in accordance with its own 
regulations on rulemaking, 24 CFR Part 10. However, part 10 does 
provide for exceptions from the general rule where the agency finds 
good cause to omit advance notice and public participation. The good 
cause requirement is satisfied when prior public procedure is 
``impracticable, unnecessary, or contrary to the public interest.'' (24 
CFR 10.1)
    The Department finds that good cause exists to publish this interim 
rule for effect without first soliciting public comment, in that prior 
public comment is contrary to the public interest because immediate 
effectiveness of this interim rule will permit the Department to 
respond immediately to housing assistance needs brought on by natural 
and other disasters, housing needs resulting from emergencies arising 
from unpredictable and sudden circumstances causing housing deprivation 
or causing an unforeseen and significant increase in lower income 
housing demands in a housing market, and housing needs resulting from 
the settlement of litigation.

List of Subjects in 24 CFR Part 791

    Grant programs--housing and community development, 
Intergovernmental relations, Public housing, Rent subsidies.

    Accordingly, 24 CFR Part 791 is amended as follows:

PART 791--REVIEW OF APPLICATIONS FOR HOUSING ASSISTANCE AND 
ALLOCATIONS OF HOUSING ASSISTANCE FUNDS

    1. The authority citation for Part 791 continues to read as 
follows:

    Authority: 42 U.S.C. 1439; 42 U.S.C. 3535(d).

    2. Section 791.407 is amended by revising the introductory text of 
paragraph (a) to read as follows:


Sec. 791.407  Headquarters Reserve.

    (a) A portion of the budget authority available for the housing 
programs listed in Sec. 791.101(a), not to exceed an amount equal to 
five percent of the total amount of budget authority available for the 
fiscal year for programs under the United States Housing Act of 1937 
listed in Sec. 791.101(a), may be retained by the Assistant Secretary 
for subsequent allocation to specific areas and communities, and may 
only be used for:
* * * * *
    Dated: June 10, 1994.
Henry G. Cisneros,
Secretary.
[FR Doc. 94-16639 Filed 7-8-94; 8:45 am]
BILLING CODE 4210-32-P