[Federal Register Volume 61, Number 189 (Friday, September 27, 1996)]
[Rules and Regulations]
[Pages 50914-50921]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-24660]



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Part III





Department of Housing and Urban Development





_______________________________________________________________________



Office of the Secretary



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24 CFR Part 50



Protection and Enhancement of Environmental Quality; Final Rule

  Federal Register / Vol. 61, No. 189 / Friday, September 27, 1996 / 
Rules and Regulations  

[[Page 50914]]



DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of the Secretary

24 CFR Part 50

[Docket No. FR-2206-F-03]
RIN 2501-AA30


Protection and Enhancement of Environmental Quality

AGENCY: Office of the Secretary, HUD.

ACTION: Final rule.

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SUMMARY: This rule finalizes the policies and procedures set forth in 
HUD's April 5, 1996 proposed rule. Additionally, this rule makes 
several clarifying and technical amendments to the proposed rule. The 
final rule simplifies, improves, and updates HUD's implementation of 
responsibilities for environmental review and decision making under the 
National Environmental Policy Act and the other related Federal 
environmental laws and authorities. This final rule replaces HUD's 
current regulations at 24 CFR part 50.

EFFECTIVE DATE: October 28, 1996.

FOR FURTHER INFORMATION CONTACT: Richard H. Broun, Director, Office of 
Community Viability, Room 7240, Department of Housing and Urban 
Development, 451 Seventh Street SW., Washington, DC 20410-7000. For 
telephone communication, contact Walter Prybyla, Deputy Director for 
Policy, Environmental Review Division at (202) 708-1201. (This number 
is not toll-free.) Hearing or speech-impaired individuals may access 
this number via TTY by calling the toll-free Federal Information Relay 
Service at 1-800-877-8339.

SUPPLEMENTARY INFORMATION:

I. The April 5, 1996 Proposed Rule

    On April 5, 1996 (61 FR 15340), HUD published a rule for public 
comment proposing to amend 24 CFR part 50 in its entirety. Part 50 
describes the procedures used by HUD to carry out its responsibilities 
under the National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 
4321-4347), the NEPA implementing regulations of the Council on 
Environmental Quality, and the other NEPA-related Federal environmental 
laws and authorities (See Sec. 50.4 of this final rule). The April 5, 
1996 rule proposed to simplify, improve, and update these regulations.
    HUD decided to completely revise 24 CFR part 50 due to the 
implementation of a series of innovative initiatives which have 
improved the way HUD delivers services to the public. As detailed in 
the preamble to the April 5, 1996 proposed rule, these initiatives 
include: (1) HUD's regulatory reinvention efforts; (2) the 
reorganization of HUD field offices; (3) Presidential Executive Order 
12898 on Environmental Justice; and (4) the need to update 24 part 50 
as a result of program experience and the evolving nature of HUD's 
programs.
    This rule finalizes the policies and procedures set forth in the 
April 5, 1996 proposed rule and makes several technical and clarifying 
amendments to the proposed regulation. The April 5, 1996 proposed rule 
discussed in detail the amendments to 24 CFR part 50.

II. This Final Rule

    The public comment period on the April 5, 1996 proposed rule 
expired on June 4, 1996. No comments were received. Although no changes 
are being made in response to public comment, HUD is making certain 
technical and clarifying amendments to the proposed rule at the final 
rule stage. This section of the preamble describes the amendments made 
by this final rule to the April 5, 1996 proposed rule.
    A. Clarification to 24 CFR 50.3(i)(1): Use of properties affected 
by hazardous materials. Paragraph (i)(1) of Sec. 50.3 concerned the use 
of properties affected by hazardous materials. The proposed use of such 
a property will be important with respect to its suitability for 
approval of HUD assistance. For example, properties which will be used 
for housing, hospitals, or nursing homes must be free of hazardous 
materials. In contrast, properties designated for industrial or 
commercial purposes, as may be the case with ``brownfield'' locations 
proposed for new uses, are permitted to be hazard-managed sites.
    Proposed 24 CFR 50.3(i)(1) required that a site be hazard-free if a 
``hazard could affect the health and safety of occupants or the 
utilization of the property.'' This broad language could be 
misinterpreted to mean that only hazard-free sites will be approved for 
HUD assistance. The final rule amends 24 CFR 50.3(i)(1) to clarify that 
a site must be free of hazardous materials if a ``hazard could affect 
the health and safety of occupants or conflict with the intended 
utilization of the property.''
    B. Section 50.17: Decision points for the hospital mortgage 
insurance and loan guarantee recovery fund programs. HUD's regulation 
at 24 CFR 50.17 lists the environmental ``decision points'' for the 
various HUD programs. A Finding of No Significant Impact (FONSI) with 
respect to the environment or an Environmental Impact Statement (EIS) 
must be completed before the applicable decision point. This final rule 
amends the April 5, 1996 proposed rule by making two changes to 
Sec. 50.17.
    The April 5, 1996 proposed rule would have removed from Sec. 50.17 
the reference to the decision point for HUD's hospital mortgage 
insurance program. The Department of Health and Human Services (HHS) is 
the lead Federal agency responsible for hospital related environmental 
review and decisionmaking. Accordingly, the preamble to the April 5, 
1996 rule explained that HUD, for purposes of its hospital mortgage 
insurance program, would rely on an HHS certification that HHS had 
complied with the applicable environmental requirements. Subsequent to 
publication of the April 5, 1996 proposed rule, HUD decided to continue 
being responsible for the environmental reviews related to its hospital 
mortgage insurance program. HUD, therefore, will continue to list the 
decision point for this program in Sec. 50.17. This final rule 
continues to require that the FONSI or EIS be completed before issuance 
of the Site Appraisal and Market Analysis (SAMA) Letter, or initial 
equivalent indication of HUD approval of a specific site. In the case 
of hospital mortgage insurance, this decision point is HUD's issuance 
of a conditional commitment.
    This final rule also updates Sec. 50.17 by adding the decision 
point for HUD's loan guarantee recovery fund program. This program, 
which is codified at new 24 CFR part 573, was established subsequent to 
publication of the April 5, 1996 proposed rule. Part 573 implements 
section 4 of the Church Arson Prevention Act of 1996 (Pub. L. 104-155, 
approved July 3, 1996). This final rule adds a new Sec. 50.17(a)(3) 
which states that the decision point for loans guaranteed under part 
573 is HUD's issuance of a commitment letter or initial equivalent 
indication of HUD approval.
    C. New Paragraphs (b) (21), (22), and (23) to Sec. 50.19: 
Additional categorical exclusions. Section 50.19 lists those activities 
which are excluded from the compliance requirements of the various 
environmental authorities. HUD omitted to list several exclusions in 
the April 5, 1996 proposed rule. This final rule corrects the 
oversight.
    1. Refinancing of HUD-insured mortgages. This final rule adds a new 
paragraph (b)(21) to Sec. 5.19, which excludes any refinancing of HUD-
insured mortgages that will not allow new construction or 
rehabilitation, nor result in any physical impacts or changes except 
for routine maintenance. Such actions are excluded from NEPA as well as 
the related laws and

[[Page 50915]]

authorities listed in Sec. 50.4, except that compliance with 24 CFR 
50.4(b)(1), which relates to flood insurance requirements, is required 
for buildings located in special flood hazard areas.
    2. Sale of HUD-held mortgages. This final rule adds a new paragraph 
(b)(22) to Sec. 50.19, which excludes the sale of a HUD-held mortgage 
on an existing property. In these cases, there is no physical impact 
and the property is not owned by HUD; the mortgage will be held by a 
new mortgagee, but the ownership of the real property does not change.
    3. Foreclosure sales of properties with HUD-held mortgages. This 
final rule also excludes the foreclosure sale of a property with a HUD-
held mortgage. Appropriate restrictions, however, will be imposed to 
protect historic properties. As is true with the exclusion listed in 
new 24 CFR 50.19(b)(22), HUD does not own the property in these cases. 
HUD, therefore, does not dispose of the property, but causes the 
property to be sold to satisfy HUD's lien. HUD has long viewed 
foreclosure sales as in the nature of civil enforcement actions (which 
are not considered Federal actions under the NEPA regulations published 
by the Council on Environmental Quality). This final rule adds a new 24 
CFR 50.19(b)(23) to clarify that these foreclosure sales are 
categorically excluded from compliance with NEPA and the other 
environmental authorities.
    D. Intergovernmental review. An error concerning intergovernmental 
review appeared in the preamble to the April 5, 1996 proposed rule. 
HUD's regulations at 24 CFR part 52 govern the intergovernmental review 
of HUD programs and activities. The preamble to the proposed rule 
mistakenly stated that 24 CFR part 52 is no longer in active use (61 FR 
15340, 15341). Accordingly, the April 5, 1996 rule proposed to remove 
all references to part 52 from 24 CFR part 50. Part 52 remains current 
and in effect. This rule, however, finalizes the removal of the 
references to 24 CFR part 52. The provisions of 24 CFR part 52 apply to 
HUD programs notwithstanding any specific reference in part 50. It is 
unnecessary for 24 CFR part 50 to cite these regulatory requirements.
    E. Section 50.23: Public participation notices. The final rule 
clarifies that notices pertaining to an EIS, an amendment to an EIS, 
and any FONSI subject to Sec. 50.34 (Time delays for exceptional 
circumstances), will be provided to the public, in accordance with 
HUD's longstanding policy to provide notices to the affected public and 
to those who have requested them. This final rule provides that the 
local HUD field office may be contacted by persons who wish to review a 
FONSI which is not subject to Sec. 50.34.
    HUD also assures public participation in other ways. For example, 
many HUD programs have public participation elements. To enhance 
citizen participation and access to information on HUD-supported 
projects, HUD has placed on the Internet the executive summaries of 
Consolidated Plans for over 900 major cities and counties. HUD 
regulations, handbooks, legislation and related documents are also 
available to the public on the Internet.

III. HUD Programs Subject to 24 CFR Part 50

    This final rule, which replaces the current provisions of 24 CFR 
part 50, applies to all HUD activities and programs, except those for 
which specific statutory authority exists to assign the environmental 
review responsibilities to recipients and other responsible entities 
that are States, units of general local government, Indian Tribes or 
other entities subject to 24 CFR part 58.
    The following is a list of those HUD programs that lack specific 
authority for assigning the Federal environmental review 
responsibilities to recipients and other responsible entities. 
Generally, the list covers all HUD programs other than those identified 
at 24 CFR 58.1(b). In addition to the programs listed below, part 50 
applies to certain projects and activities carried out by recipients 
subject to the environmental policy and procedures of 24 CFR part 58 
(see 24 CFR 50.1(d)).
    The following may not be an exhaustive list, but contains the 
principal HUD assistance programs subject to 24 CFR part 50. The number 
in brackets represents the part or section of title 24 in which the 
program regulations can be found. The number, if any following the 
brackets, represents the Catalog Number of Federal Domestic Assistance.

Office of Community Planning and Development

     HOPE for Homeownership of Single Family Homes: HOPE 3 
[572] 14.240.
     Housing Opportunities for Persons with AIDS [574] 14.241.
     Emergency Shelter Grants Program: Stewart B. McKinney 
Homeless Assistance Act [576] [Part 50 applies only to applicants that 
are private nonprofit organizations and to governmental entities with 
special or limited purpose powers] 14.231.
     Supportive Housing Program [583] [Part 50 applies only to 
applicants that are private nonprofit organizations and to governmental 
entities with special or limited purpose powers] 14.235.
     Shelter Plus Care [582] [Part 50 applies to applications 
from Public Housing Agency applicants, except that Part 58 applies to 
the Section 8 Moderate Rehabilitation for Single Room Occupancy (SRO) 
Dwellings component of the Shelter Plus Care program] 14.238.
     Opportunities for Youth: Youthbuild [585] 14.243.
     John Heinz Neighborhood Development Program [594] 14.242.
     Special Purpose Grants for Historically-Black Colleges and 
Universities [570.404] 14.237.
     Base Closure Community Redevelopment and Homeless 
Assistance [586] 14.227.
     Loan Guarantee Recovery Fund Program [573].

Office of Housing: Single Family Housing Programs

     HUD-Acquired Single Family Property Disposition [291].

Office of Housing: Multifamily Housing Programs

     Multifamily Rental Housing for Moderate-Income Families: 
Section 221(d)(3) and (4) [221] 14.135.
     Existing Multifamily Rental Housing: Section 223(f) 
[207.32a] 14.155.
     Supportive Housing for the Elderly: Section 202 [889] 
14.157.
     Supportive Housing for Persons with Disabilities: Section 
811 [890] 14.181.
     Mortgage Insurance for Single Room Occupancy Projects: 
Section 221(d) pursuant to Section 223(g) [221.565] 14.135.
     Mortgage Insurance for Nursing Homes, Intermediate Care 
Facilities, Board and Care Homes, and Assisted Living Facilities: 
Section 232 [232] 14.129.
     Supplementary Financing for Multifamily Projects: Section 
241 [241] 14.151.
     HOPE for Homeownership of Multifamily Units: HOPE 2 
[Appendix B to Subtitle A of 24 CFR] 14.185.
     Low-Income Housing Preservation and Resident 
Homeownership: Title VI [248 subpart B] 14.187.
     Emergency Low-Income Housing Preservation: Title II [248 
subpart C] 14.187.
     Flexible Subsidy Program for Troubled Projects: Section 
201 [219] 14.164.
     Manufactured Home Parks: Section 207 Land development 
[207.33] 14.127.

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     Disposition of Multifamily Projects and Sale of HUD-held 
Multifamily Mortgages [290].
     Mortgage Insurance for Housing for the Elderly: Section 
231 [231] 14.138 [Not used. Instead Sections 221 (d)(3) and (d)(4) are 
used.]
     Cooperative Housing: Section 213 [213] 14.126 [Authorized 
but not used. New construction and substantial rehabilitation 
cooperative projects are currently insured under Section 221(d)(3).]
     Multifamily Rental Housing: Section 207 [207] 14.134 [Not 
used. Instead Sections 221 (d)(3) and (d)(4) are used.]
     Mortgage Insurance and Insured Improvement Loans for Urban 
Renewal and Concentrated Development Areas: Section 220 [220] 14.139 
[Not frequently used.]
     Group Practice Medical Facilities: Title XI [244] 14.116 
[Not used in recent years.]
     Nehemiah Housing Opportunity Grants Program [280] [No 
current funding.]

Office of Public and Indian Housing

     HOPE for Public and Indian Housing Homeownership Program 
[Appendix A to Subtitle A of 24 CFR] 14.858.
     Public and Indian Housing Youth Sports Program [proposed 
961.50] 14.863.
     Public and Indian Housing Drug Elimination Program [761] 
14.854.
     Part 50 continues to be used for the following public 
housing programs until October 14, 1996, when the programs will become 
subject to environmental review procedures under 24 CFR part 58:
     Public Housing Development [941] 14.850 and 14.851.
     Public Housing Modernization [968] 14.852 and 14.859.
     Demolition or Disposition of Public Housing Projects [970] 
14.850.

Office of Policy Development and Research

     CDBG Joint Community Development Program [570.411] [Part 
50 applies only to applicants (e.g. to universities) that are not a 
State or unit of general local government.]

IV. Findings and Certifications

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, 
implementing section 102(2)(C) of the National Environmental Policy Act 
of 1969 (42 U.S.C. 4332) at the time of the development of the proposed 
rule. The Finding of No Significant Impact remains applicable to this 
final rule and is available for public inspection during business hours 
in the Office of the Rules Docket Clerk, Room 10276, Department of 
Housing and Urban Development, 451 Seventh Street, SW., Washington, DC 
20410-0500.

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 rule have no federalism implications, and that the 
policies are not subject to review under the Order. This rule is 
limited to updating HUD's implementation of its responsibilities for 
environmental review and decision making under the National 
Environmental Policy Act and other related Federal environmental laws 
and authorities.

Executive Order 12606, The Family

    The General Counsel, as the Designated Official under Executive 
Order 12606, The Family, has determined that this final 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. This rule updates and streamlines 24 CFR part 50, which sets 
forth HUD's regulations governing the protection and enhancement of 
environmental quality. No significant change in existing HUD policies 
or programs will result from promulgation of this rule, as those 
policies and programs relate to family concerns.

Regulatory Flexibility Act

    The Secretary, in accordance with the Regulatory Flexibility Act (5 
U.S.C. 605(b)) has reviewed and approved this rule, and in so doing 
certifies that this rule will not have a significant economic impact on 
a substantial number of small entities. This rule, which revises 24 CFR 
part 50 in its entirety, finalizes the policies and procedures set 
forth in the April 5, 1996 proposed rule. Specifically, the rule 
simplifies, improves, and updates HUD's implementation of 
responsibilities for environmental review and decision making under the 
National Environmental Policy Act and the other related Federal 
environmental laws and authorities. This final rule will have no 
adverse or disproportionate economic impact on small entities.

Unfunded Mandates Reform Act

    The Secretary has reviewed this rule before publication and by 
approving it certifies, in accordance with the Unfunded Mandates Reform 
Act of 1995 (2 U.S.C. 1532), that this rule does not impose a Federal 
mandate that will result in the expenditure by State, local, and tribal 
governments, in the aggregate, or by the private sector, of $100 
million or more in any one year.

Catalog of Federal Domestic Assistance

    The program numbers are 14.128-14.900. Also see section III. of 
this preamble.

List of Subjects in 24 CFR Part 50

    Environmental quality, Environmental protection, Environmental 
review policy and procedures, Environmental assessment, Environmental 
impact statement, Compliance record.

    Accordingly, 24 CFR part 50 is revised to read as follows:

PART 50--PROTECTION AND ENHANCEMENT OF ENVIRONMENTAL QUALITY

Subpart A--General: Federal Laws and Authorities

Sec.
50.1  Purpose, authority, and applicability.
50.2  Terms and abbreviations.
50.3  Environmental policy.
50.4  Related Federal laws and authorities.

Subpart B--General Policy: Responsibilities and Program Coverage

50.10  Basic environmental responsibility.
50.11  Responsibility of the HUD approving official.

Subpart C--General Policy: Decision Points

50.16  Decision points for policy actions.
50.17  Decision points for projects.

Subpart D--General Policy: Environmental Review Procedures

50.18  General.
50.19  Categorical exclusions not subject to the Federal laws and 
authorities cited in Sec. 50.4.
50.20  Categorical exclusions subject to the Federal laws and 
authorities cited in Sec. 50.4.
50.21  Aggregation.
50.22  Environmental management and monitoring.
50.23  Public participation.
50.24  HUD review of another agency's EIS.

Subpart E--Environmental Assessments and Related Reviews

50.31  The EA.
50.32  Responsibility for environmental processing.
50.33  Action resulting from the EA.
50.34  Time delays for exceptional circumstances.

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50.35  Use of prior environmental assessments.
50.36  Updating environmental reviews.

Subpart F--Environmental Impact Statements

50.41  EIS policy.
50.42  Cases when an EIS is required.
50.43  Emergencies.

    Authority: 42 U.S.C. 3535(d) and 4332; and Executive Order 
11991, 3 CFR, 1977 Comp., p. 123.

Subpart A--General: Federal Laws and Authorities


Sec. 50.1  Purpose, authority, and applicability.

    (a) This part implements the policies of the National Environmental 
Policy Act (NEPA) and other environmental requirements (as specified in 
Sec. 50.4).
    (b) NEPA (42 U.S.C. 4321 et seq.), establishes national policy, 
goals and procedures for protecting, restoring and enhancing 
environmental quality. NEPA is implemented by Executive Order 11514 of 
March 5, 1970, (3 CFR, 1966--1970 Comp., p. 902) as amended by 
Executive Order 11991 of May 24, 1977, (3 CFR, 1977 Comp., p. 123) and 
by the Council on Environmental Quality (CEQ) Regulations, 40 CFR parts 
1500-1508.
    (c) The regulations issued by CEQ at 40 CFR parts 1500-1508 
establish the basic procedural requirements for compliance with NEPA. 
These procedures are to be followed by all Federal agencies and are 
incorporated by reference into this part. This part, therefore, 
provides supplemental instructions to reflect the particular nature of 
HUD programs, and is to be used in tandem with 40 CFR parts 1500-1508 
and regulations that implement authorities cited at Sec. 50.4.
    (d) These regulations apply to all HUD policy actions (as defined 
in Sec. 50.16), and to all HUD project actions (see Sec. 50.2(a)(2)). 
Also, they apply to projects and activities carried out by recipients 
subject to environmental policy and procedures of 24 CFR part 58, when 
the recipient that is regulated under 24 CFR part 58 claims the lack of 
legal capacity to assume the Secretary's environmental review 
responsibilities and the claim is approved by HUD or when HUD 
determines to conduct an environmental review itself in place of a 
nonrecipient responsible entity. For programs, activities or actions 
not specifically identified or when there are questions regarding the 
applicability of this part, the Assistant Secretary for Community 
Planning and Development shall be consulted.


Sec. 50.2  Terms and abbreviations.

    (a) The definitions for most of the key terms or phrases contained 
in this part appear in 40 CFR part 1508 and in the authorities cited in 
Sec. 50.4.
    The following definitions also apply to this part:
    Environmental review means a process for complying with NEPA 
(through an EA or EIS) and/or with the laws and authorities cited in 
Sec. 50.4.
    HUD approving official means the HUD official authorized to make 
the approval decision for any proposed policy or project subject to 
this part.
    Project means an activity, or a group of integrally-related 
activities, undertaken directly by HUD or proposed for HUD assistance 
or insurance.
    (b) The following abbreviations are used throughout this part:
    AS/CPD--Assistant Secretary for Community Planning and Development.
    CEQ--Council on Environmental Quality
    EA--Environmental Assessment
    EIS--Environmental Impact Statement
    FONSI--Finding of No Significant Impact
    HUD--Department of Housing and Urban Development
    NEPA--National Environmental Policy Act
    NOI/EIS--Notice of Intent to Prepare an Environmental Impact 
Statement


Sec. 50.3  Environmental policy.

    (a) It is the policy of the Department to reject proposals which 
have significant adverse environmental impacts and to encourage the 
modification of projects in order to enhance environmental quality and 
minimize environmental harm.
    (b) The HUD approving official shall consider environmental and 
other Departmental objectives in the decisionmaking process.
    (c) When EA's or EIS's or reviews under Sec. 50.4 reveal conditions 
or safeguards that should be implemented once a proposal is approved in 
order to protect and enhance environmental quality or minimize adverse 
environmental impacts, such conditions or safeguards must be included 
in agreements or other relevant documents.
    (d) A systematic, interdisciplinary approach shall be used to 
assure the integrated use of the natural and social sciences and the 
environmental design arts in making decisions.
    (e) Environmental impacts shall be evaluated on as comprehensive a 
scale as is practicable.
    (f) HUD offices shall begin the environmental review process at the 
earliest possible time so that potential conflicts between program 
procedures and environmental requirements are identified at an early 
stage.
    (g) Applicants for HUD assistance shall be advised of environmental 
requirements and consultation with governmental agencies and 
individuals shall take place at the earliest time feasible.
    (h) For HUD grant programs in which the funding approval for an 
applicant's program must occur before the applicant's selection of 
properties, the application shall contain an assurance that the 
applicant agrees to assist HUD to comply with this part and that the 
applicant shall:
    (1) Supply HUD with all available, relevant information necessary 
for HUD to perform for each property any environmental review required 
by this part;
    (2) Carry out mitigating measures required by HUD or select 
alternate eligible property; and
    (3) Not acquire, rehabilitate, convert, lease, repair or construct 
property, nor commit or expend HUD or local funds for these program 
activities with respect to any eligible property, until HUD approval of 
the property is received.
    (i)(1) It is HUD policy that all property proposed for use in HUD 
programs be free of hazardous materials, contamination, toxic chemicals 
and gasses, and radioactive substances, where a hazard could affect the 
health and safety of occupants or conflict with the intended 
utilization of the property.
    (2) HUD environmental review of multifamily and non-residential 
properties shall include evaluation of previous uses of the site and 
other evidence of contamination on or near the site, to assure that 
occupants of proposed sites are not adversely affected by the hazards 
listed in paragraph (i)(1) of this section.
    (3) Particular attention should be given to any proposed site on or 
in the general proximity of such areas as dumps, landfills, industrial 
sites or other locations that contain hazardous wastes.
    (4) HUD shall require the use of current techniques by qualified 
professionals to undertake investigations determined necessary.


Sec. 50.4  Related Federal laws and authorities.

    HUD and/or applicants must comply, where applicable, with all 
environmental requirements, guidelines and statutory obligations under 
the following authorities and HUD standards:

[[Page 50918]]

    (a) Historic properties: (1) The National Historic Preservation Act 
of 1966 (16 U.S.C. 470 et seq.), as amended.
    (2) Executive Order 11593, Protection and Enhancement of the 
Cultural Environment, May 13, 1971 (3 CFR, 1971--1975 Comp., p. 559).
    (3) The Archaeological and Historic Preservation Act of 1974, which 
amends the Reservoir Salvage Act of 1960 (16 U.S.C. 469 et seq.).
    (4) Procedures for the Protection of Historic and Cultural 
Properties (Advisory Council on Historic Preservation--36 CFR part 
800).
    (b) Flood insurance, floodplain management and wetland protection: 
(1) Flood Disaster Protection Act of 1973 (42 U.S.C. 4001-4128) and the 
National Flood Insurance Reform Act of 1994 (Pub.L. 103-325, 108 Stat. 
2160).
    (2) HUD Procedure for the Implementation of Executive Order 11988 
(3 CFR, 1977 Comp., p. 117)--24 CFR part 55, Floodplain Management.
    (3) Executive Order 11990 (Protection of Wetlands), (3 CFR, 1977 
Comp., p. 121).
    (c) Coastal areas protection and management. (1) The Coastal 
Barrier Resources Act, as amended by the Coastal Barrier Improvement 
Act of 1990 (16 U.S.C. 3501 et seq.).
    (2) The Coastal Zone Management Act of 1972 (16 U.S.C. 1451 et 
seq.), as amended.
    (d) Sole source aquifers. The Safe Drinking Water Act of 1974 (42 
U.S.C. 201, 300 et seq., and 21 U.S.C. 349), as amended. (See 40 CFR 
part 149.)
    (e) Endangered species. The Endangered Species Act of 1973 (16 
U.S.C. 1531 et seq.), as amended. (See 50 CFR part 402.)
    (f) Wild and scenic rivers. The Wild and Scenic Rivers Act (16 
U.S.C 1271 et seq.), as amended.
    (g) Water quality. The Federal Water Pollution Control Act, as 
amended by the Federal Water Pollution Control Act Amendments of 1972 
(33 U.S.C. 1251 et seq.), and later enactments.
    (h) Air quality. The Clean Air Act (42 U.S.C. 7401 et seq.), as 
amended. (See 40 CFR parts 6, 51, and 93.)
    (i) Solid waste management. (1) The Solid Waste Disposal Act, as 
amended by the Resource Conservation and Recovery Act of 1976 (42 
U.S.C. 6901 et seq.), and later enactments.
    (2) The Comprehensive Environmental Response, Compensation, and 
Liability Act of 1980 (42 U.S.C. 9601 et seq.), as amended.
    (j) Farmlands protection. The Farmland Protection Policy Act of 
1981 (7 U.S.C. 4201 et seq.), as amended. (See 7 CFR part 658.)
    (k) HUD environmental standards. Applicable criteria and standards 
specified in HUD environmental regulations (24 CFR part 51).
    (l) Environmental justice. Executive Order 12898--Federal Actions 
to Address Environmental Justice in Minority Populations and Low-Income 
Populations (3 CFR, 1994 Comp., p. 859).

Subpart B--General Policy: Responsibilities and Program Coverage


Sec. 50.10  Basic environmental responsibility.

    (a) It is the responsibility of all Assistant Secretaries, the 
General Counsel, and the HUD approving official to assure that the 
requirements of this part are implemented.
    (b) The Assistant Secretary for Community Planning and Development 
(A/S CPD), represented by the Office of Community Viability, whose 
Director shall serve as the Departmental Environmental Clearance 
Officer (DECO), is assigned the overall Departmental responsibility for 
environmental policies and procedures for compliance with NEPA and the 
related laws and authorities. To the extent permitted by applicable 
laws and the CEQ regulations, the A/S CPD shall approve waivers and 
exceptions or establish criteria for exceptions from the requirements 
of this part.


Sec. 50.11  Responsibility of the HUD approving official.

    (a) The HUD approving official shall make an independent evaluation 
of the environmental issues, take responsibility for the scope and 
content of the compliance finding, EA or EIS, and make the 
environmental finding, where applicable. (Also, see Sec. 50.32.)
    (b) Copies of environmental reviews and findings shall be 
maintained in the project file for projects, in the rules docket files 
for Federal Register publications, and in program files for non-Federal 
Register policy documents.

Subpart C--General Policy: Decision Points


Sec. 50.16  Decision points for policy actions.

    Either an EA and FONSI or an EIS on all policy actions not meeting 
the criteria of Sec. 50.19 shall be completed prior to the approval 
action. Policy actions include all proposed Federal Register policy 
documents and other policy-related Federal actions (40 CFR 1508.18). 
The decision as to whether a proposed policy action is categorically 
excluded from an EA shall be made by the Program Environmental 
Clearance Officer (PECO) in Headquarters as early as possible. Where 
the PECO has any doubt as to whether a proposed action qualifies for 
exclusion, the PECO shall request a determination by the AS/CPD. The EA 
and FONSI may be combined into a single document.


Sec. 50.17  Decision points for projects.

    Either an EA and FONSI or an EIS for individual projects shall be 
completed before the applicable program decision points below for 
projects not meeting the criteria of Sec. 50.20. Compliance with 
applicable authorities cited in Sec. 50.4 shall be completed before the 
applicable program decision points below unless the project meets the 
criteria for exclusion under Sec. 50.19.
    (a) New Construction. (1) Project mortgage insurance or other 
financial assistance for multifamily housing projects (including 
sections 202 and 811), nursing homes, hospitals, group practice 
facilities and manufactured home parks: Issuance of Site Appraisal and 
Market Analysis (SAMA) Letter or initial equivalent indication of HUD 
approval of a specific site;
    (2) Public Housing: HUD approval of the proposal.
    (3) Loan Guarantee Recovery Fund Program (24 CFR part 573). HUD 
issuance of a letter of commitment or initial equivalent indication of 
HUD approval.
    (b) Rehabilitation projects. Use the decision points under ``new 
construction'' for HUD programs cited in paragraph (a) of this section; 
otherwise the decision point is the HUD project approval.
    (c) Public housing modernization programs. HUD approval of the 
modernization grants.
    (d) Property Disposition. Multifamily structures, college housing, 
nursing homes, manufactured homes and parks, group practice facilities, 
vacant land and one to four family structures: HUD approval of the 
Disposition Program.
    (e) HUD programs subject to 24 CFR part 58. For cases in which HUD 
exercises environmental responsibility under this part where a 
recipient lacks legal capacity to do so or HUD determines to do so in 
place of a nonrecipient responsible entity under 24 CFR part 58 (see 
Sec. 50.1(d)), the decision point is: HUD's execution of an agreement 
or contract, whichever comes first, or in the case of Section 8 
Project-Based Certificate Assistance and Moderate Rehabilitation, HUD 
notification to the Public Housing Agency to proceed with execution of 
an Agreement to Enter into Housing Assistance Payments (HAP) Contract.

[[Page 50919]]

    (f) Section 50.3(h). Notwithstanding the other paragraphs of this 
section, the decision point for grant programs in which HUD approval of 
funding for an applicant's program must occur before the applicant's 
selection of properties for use in its program is: HUD approval of 
specific properties.
    (g) Stewart B. McKinney Homeless Assistance Act Programs. Where the 
recipients are nonprofit organizations or governmental entities with 
special or limited purpose powers, the decision point is: HUD project 
approval.
    (h) Programs not specifically covered in this section. Consult with 
the AS/CPD for decision points.

Subpart D--General Policy: Environmental Review Procedures


Sec. 50.18  General.

    HUD may, from time to time, complete programmatic reviews that 
further avoid the necessity of complying with the laws and authorities 
in Sec. 50.4 on a property-by-property basis.


Sec. 50.19  Categorical exclusions not subject to the Federal laws and 
authorities cited in Sec. 50.4.

    (a) The activities listed below are not subject to the individual 
compliance requirements of the Federal laws and authorities cited in 
Sec. 50.4, unless otherwise indicated below. These activities are also 
categorically excluded from the EA required by NEPA except in 
extraordinary circumstances (Sec. 50.20(b)). HUD approval or 
implementation of these categories of activities and related policy 
actions does not require environmental review, because they do not 
alter physical conditions in a manner or to an extent that would 
require review under NEPA or the other laws and authorities cited at 
Sec. 50.4.
    (b)(1) Environmental and other studies, resource identification and 
the development of plans and strategies.
    (2) Information and financial advisory services.
    (3) Administrative and management expenses.
    (4) Public services that will not have a physical impact or result 
in any physical changes, including but not limited to services 
concerned with employment, crime prevention, child care, health, drug 
abuse, education, counseling, energy conservation and welfare or 
recreational needs.
    (5) Inspections and testing of properties for hazards or defects.
    (6) Purchase of insurance.
    (7) Purchase of tools.
    (8) Engineering or design costs.
    (9) Technical assistance and training.
    (10) Assistance for temporary or permanent improvements that do not 
alter environmental conditions and are limited to protection, repair or 
restoration activities necessary only to control or arrest the effects 
from disasters or imminent threats to public safety including those 
resulting from physical deterioration.
    (11) Tenant-based rental assistance.
    (12) Supportive services including, but not limited to, health 
care, housing services, permanent housing placement, day care, 
nutritional services, short-term payments for rent/mortgage/utility 
costs, and assistance in gaining access to local, State, and Federal 
government benefits and services.
    (13) Operating costs including maintenance, security, operation, 
utilities, furnishings, equipment, supplies, staff training and 
recruitment and other incidental costs; however, in the case of 
equipment, compliance with Sec. 50.4(b)(1) is required.
    (14) Economic development activities, including but not limited to, 
equipment purchase, inventory financing, interest subsidy, operating 
expenses and similar costs not associated with construction or 
expansion of existing operations; however, in the case of equipment 
purchase, compliance with Sec. 50.4(b)(1) is required.
    (15) Activities to assist homeownership of existing dwelling units, 
including closing costs and down payment assistance to home buyers, 
interest buydowns and similar activities that result in the transfer of 
title to a property; however, compliance with Secs. 50.4 (b)(1) and 
(c)(1) and 51.303(a)(3) is required.
    (16) Housing pre-development costs including legal, consulting, 
developer and other costs related to site options, project financing, 
administrative costs and fees for loan commitments, zoning approvals, 
and other related activities which do not have a physical impact.
    (17) HUD's endorsement of one-to-four family mortgage insurance 
under the Direct Endorsement program and HUD's acceptance for insurance 
of loans under Title I of the National Housing Act; however, compliance 
with Secs. 50.4 (b)(1) and (c)(1) and 51.303(a)(3) is required.
    (18) HUD's endorsement of one-to-four family mortgage insurance for 
proposed construction under Improved Area processing; however, the 
Appraiser/Review Appraiser Checksheet (Form HUD-54891) must be 
completed.
    (19) Activities of the Government National Mortgage Association 
under Title III of the National Housing Act (12 U.S.C. 1716 et seq.).
    (20) Activities under the Interstate Land Sales Full Disclosure Act 
(15 U.S.C. 1701 et seq.).
    (21) Refinancing of HUD-insured mortgages that will not allow new 
construction or rehabilitation, nor result in any physical impacts or 
changes except for routine maintenance; however, compliance with 
Sec. 50.4(b)(1) is required.
    (22) Approval of the sale of a HUD-held mortgage.
    (23) Approval of the foreclosure sale of a property with a HUD-held 
mortgage; however, appropriate restrictions will be imposed to protect 
historic properties.
    (c)(1) Approval of policy documents that do not direct, provide for 
assistance or loan and mortgage insurance for, or otherwise govern or 
regulate property acquisition, disposition, lease, rehabilitation, 
alteration, demolition, or new construction, or set out or provide for 
standards for construction or construction materials, manufactured 
housing, or occupancy;
    (2) Approval of policy documents that amend a previous document 
where the underlying document as a whole would not fall within the 
exclusion but the amendment by itself would do so;
    (3) Approval of policy documents that set out fair housing or 
nondiscrimination standards or provide for assistance in promoting or 
enforcing fair housing or nondiscrimination;
    (4) Approval of handbooks, notices and other documents that provide 
operating instructions and procedures in connection with activities 
under a Federal Register document that has previously been subject to a 
required environmental review.
    (5) Approval of a Notice of Funding Availability (NOFA) that 
provides funding under, and does not alter environmental requirements 
of, a regulation or program guideline that was previously published in 
the Federal Register, provided that the NOFA specifically refers to the 
environmental review provisions of the regulation or guideline.
    (6) Statutorily required and/or discretionary establishment and 
review of interest rates, loan limits, building cost limits, prototype 
costs, fair market rent schedules, HUD-determined prevailing wage 
rates, and similar rate and cost determinations and related external 
administrative or fiscal requirements or procedures which do not 
constitute a development decision that affects the physical condition 
of specific project areas or building sites.

[[Page 50920]]

Sec. 50.20  Categorical exclusions subject to the Federal laws and 
authorities cited in Sec. 50.4.

    (a) The following actions, activities and programs are 
categorically excluded from the NEPA requirements of this part. They 
are not excluded from individual compliance requirements of other 
environmental statutes, Executive orders and HUD standards cited in 
Sec. 50.4, where appropriate. Form HUD-4128 shall be used to document 
compliance. Where the responsible official determines that any item 
identified below may have an environmental effect because of 
extraordinary circumstances (40 CFR 1508.4), the requirements of NEPA 
shall apply (see paragraph (b) of this section).
    (1) Special projects directed to the removal of material and 
architectural barriers that restrict the mobility of and accessibility 
to elderly and persons with disabilities.
    (2) Rehabilitation of structures when the following conditions are 
met:
    (i) In the case of residential buildings, the unit density is not 
changed more than 20 percent;
    (ii) The project does not involve changes in land use (from non-
residential to residential or from residential to non-residential); and
    (iii) The estimated cost of rehabilitation is less than 75 percent 
of the total estimated cost of replacement after rehabilitation.
    (3) An individual action on a one- to four-family dwelling or an 
individual action on a project of five or more units developed on 
scattered sites when the sites are more than 2,000 feet apart and there 
are not more than four units on any one site.
    (4) Acquisition or disposition of, or equity loans on, an existing 
structure.
    (5) Purchased or refinanced housing and medical facilities under 
section 223(f) of the National Housing Act (12 U.S.C. 1715n).
    (6) Mortgage prepayments or plans of action (including incentives) 
under 24 CFR part 248.
    (b) For categorical exclusions having the potential for significant 
impact because of extraordinary circumstances, HUD must prepare an EA 
in accordance with subpart E. If it is evident without preparing an EA 
that an EIS is required pursuant to Sec. 50.42, HUD should proceed 
directly to the preparation of an EIS in accordance with subpart F.


Sec. 50.21  Aggregation.

    Activities which are geographically related and are logical parts 
of a composite of contemplated HUD projects shall be evaluated 
together.


Sec. 50.22  Environmental management and monitoring.

    An Environmental Management and Monitoring Program shall be 
established prior to project approval when it is deemed necessary by 
the HUD approving official. The program shall be part of the approval 
document and must:
    (a) Be concurred in by the Field Environmental Clearance Officer 
(FECO) (in the absence of a FECO, by the Program Environmental 
Clearance Officer in Headquarters) and any cooperating agencies;
    (b) Contain specific standards, safeguards and commitments to be 
completed during project implementation;
    (c) Identify the staff who will be responsible for the post-
approval inspection; and
    (d) Specify the time periods for conducting the evaluation and 
monitoring the applicant's compliance with the project agreements.


Sec. 50.23  Public participation.

    HUD shall inform the affected public about NEPA-related hearings, 
public meetings, and the availability of environmental documents (see 
40 CFR 1506.6(b)) in accordance with this section. Where project 
actions result in a FONSI, the FONSI will be available in the project 
file. The local HUD field office may be contacted by persons who wish 
to review the FONSI. In all cases, HUD shall mail notices to those who 
have requested them. Additional efforts for involving the public in 
specific notice or compliance requirements shall be made in accord with 
the implementing procedures of the laws and authorities cited in 
Sec. 50.4. Notices pertaining to an EIS or an amendment to an EIS or a 
FONSI subject to Sec. 50.34 shall be given to the public in accordance 
with paragraphs (a) through (d) of this section.
    (a) A NOI/EIS shall be forwarded to the AS/CPD to the attention of 
the Departmental Environmental Clearance Officer for publication in the 
Federal Register.
    (b) Notices will be bilingual if the affected public includes a 
significant portion of non-English speaking persons and will identify a 
date when the official public involvement element of the proposed 
action is to be completed and HUD internal processing is to continue.
    (c) All required notices shall be published in an appropriate local 
printed news medium, and sent to individuals and groups known to be 
interested in the proposed action.
    (d) All notices shall inform the public where additional 
information may be obtained.


Sec. 50.24  HUD review of another agency's EIS.

    Where another agency's EIS is referred to the HUD Field Office in 
whose jurisdiction the project is located, the Field Environmental 
Clearance Officer shall determine whether HUD has an interest in the 
EIS and, if so, will review and comment. Any EIS received from another 
Federal agency requesting comment on legislative proposals, 
regulations, or other policy documents shall be sent to the AS/CPD for 
comment, and the AS/CPD shall provide the General Counsel the 
opportunity for comment.

Subpart E--Environmental Assessments and Related Reviews


Sec. 50.31  The EA.

    (a) Form HUD-4128--Environmental Assessment and Compliance Findings 
for the Related Laws--is the EA form to be used for analysis and 
documentation by HUD for projects and activities under subpart E. The 
Departmental Environmental Clearance Officer shall approve the issuance 
of equivalent formats, if Form HUD-4128 does not meet specific program 
needs.
    (b) The program representative shall obtain interdisciplinary 
assistance from professional experts and other HUD staff as needed. 
Additional information may also be requested of the sponsor/applicant. 
HUD is responsible for assessing and documenting the extent of the 
environmental impact.


Sec. 50.32  Responsibility for environmental processing.

    The program staff in the HUD office responsible for processing the 
project application or recommending a policy action is responsible for 
conducting the compliance finding, EA, or EIS. The collection of data 
and studies as part of the information contained in the environmental 
review may be done by an applicant or the applicant's contractor. The 
HUD program staff may use any information supplied by the applicant or 
contractor, provided HUD independently evaluates the information, will 
be responsible for its accuracy, supplements the information, if 
necessary, to conform to the requirements of this part, and prepares 
the environmental finding. Assessments for projects over 200 lots/
dwelling units or beds shall be sent to the Field Environmental 
Clearance Officer (FECO) or, in the absence of a FECO, to the Program 
Environmental Clearance

[[Page 50921]]

Officer in Headquarters for review and comment.


Sec. 50.33  Action resulting from the assessment.

    (a) A proposal may be accepted without modifications if the EA 
indicates that the proposal will not significantly (see 40 CFR 1508.27) 
affect the quality of the human environment and a FONSI is prepared.
    (b) A proposal may be accepted with modifications provided that:
    (1) Changes have been made that would reduce adverse environmental 
impact to acceptable and insignificant levels; and
    (2) An Environmental Management and Monitoring Program is developed 
in accordance with Sec. 50.22 when it is deemed necessary by the HUD 
approving official.
    (c) A proposal should be rejected if significant and unavoidable 
adverse environmental impacts would still exist after modifications 
have been made to the proposal and an EIS is not prepared.
    (d) A proposal (if not rejected) shall require an EIS if the EA 
indicates that significant environmental impacts would result.


Sec. 50.34  Time delays for exceptional circumstances.

    (a) Under the circumstances described in this section, the FONSI 
must be made available for public review for 30 calendar days before a 
final decision is made whether to prepare an EIS and before the HUD 
action is taken. The circumstances are:
    (1) When the proposed action is, or is closely similar to, one 
which normally requires the preparation of an EIS pursuant to 
Sec. 50.42(b) but it is determined, as a result of an EA or in the 
course of preparation of a draft EIS, that the proposed action will not 
have a significant impact on the human environment; or
    (2) When the nature of the proposed action is without precedent and 
does not appear to require more than an assessment.
    (b) In such cases, the FONSI must be concurred in by the AS/CPD and 
the Program Environmental Clearance Officer. Notice of the availability 
of the FONSI shall be given to the public in accordance with paragraphs 
(a) through (d) of Sec. 50.23.


Sec. 50.35  Use of prior environmental assessments.

    When other Federal, State, or local agencies have prepared an EA or 
other environmental analysis for a proposed HUD project, these 
documents should be requested and used to the extent possible. HUD 
must, however, conduct the environmental analysis and prepare the EA 
and be responsible for the required environmental finding.


Sec. 50.36  Updating of environmental reviews.

    The environmental review must be re-evaluated and updated when the 
basis for the original environmental or compliance findings is affected 
by a major change requiring HUD approval in the nature, magnitude or 
extent of a project and the project is not yet complete. A change only 
in the amount of financing or mortgage insurance involved does not 
normally require the environmental review to be re-evaluated or 
updated.

Subpart F--Environmental Impact Statements


Sec. 50.41  EIS policy.

    EIS's will be prepared and considered in program determinations 
pursuant to the general environmental policy stated in Sec. 50.3 and 40 
CFR 1505.2 (b) and (c).


Sec. 50.42  Cases when an EIS is required.

    (a) An EIS is required if the proposal is determined to have a 
significant impact on the human environment pursuant to subpart E.
    (b) An EIS will normally be required if the proposal:
    (1) Would provide a site or sites for hospitals or nursing homes 
containing a total of 2,500 or more beds; or
    (2) Would remove, demolish, convert, or substantially rehabilitate 
2,500 or more existing housing units (but not including rehabilitation 
projects categorically excluded under Sec. 50.20), or which would 
result in the construction or installation of 2,500 or more housing 
units, or which would provide sites for 2,500 or more housing units.
    (c) When the environmental concerns of one or more Federal 
authorities cited in Sec. 50.4 will be affected by the proposal, the 
cumulative impact of all such effects should be assessed to determine 
whether an EIS is required. Where all of the affected authorities 
provide alternative procedures for resolution, those procedures should 
be used in lieu of an EIS.


Sec. 50.43  Emergencies.

    In cases of national emergency and disasters or cases of imminent 
threat to health and safety or other emergency which require the taking 
of an action with significant environmental impact, the provisions of 
40 CFR 1506.11 and of any applicable Sec. 50.4 authorities which 
provide for emergencies shall apply.

    Dated: September 19, 1996.
Henry G. Cisneros,
Secretary.
[FR Doc. 96-24660 Filed 9-26-96; 8:45 am]
BILLING CODE 4210-32-P