[Federal Register Volume 61, Number 198 (Thursday, October 10, 1996)]
[Proposed Rules]
[Pages 53276-53277]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-25829]



[[Page 53275]]


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Part II





Department of Housing and Urban Development





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24 CFR Part 572



Homeownership of Single Family Homes Program (HOPE 3); Streamlining 
Rule; Proposed Rule

  Federal Register / Vol. 61, No. 198 / Thursday, October 10, 1996 / 
Proposed Rules  

[[Page 53276]]



DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 572

[Docket No. FR-3857-P-03]


Office of the Assistant Secretary for Community Planning and 
Development; Homeownership of Single Family Homes Program (HOPE 3); 
Streamlining Rule

RIN 2506-AB71
AGENCY: Office of the Assistant Secretary for Community Planning and 
Development, HUD.

ACTION: Proposed rule.

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SUMMARY: This proposed rule is being issued soon after a final rule 
that streamlines HUD's regulations for the HOPE for Homeownership of 
Single Family Homes Program (HOPE 3) Program. This rule proposes 
further amendments to the regulations that comply with the President's 
regulatory reform initiatives by eliminating remaining provisions that 
are unnecessarily expansive, in light of existing statutory 
requirements, but for which notice-and-comment rulemaking is required.

DATES: Comment due date: December 9, 1996.

FOR FURTHER INFORMATION CONTACT: Gordon McKay, Director, Office of 
Affordable Housing Programs, Room 7168, Department of Housing and Urban 
Development, 451 7th Street, SW, Washington, DC 20410, telephone number 
(202) 708-2685 (this is not a toll-free number). For hearing- and 
speech-impaired persons, this number may be accessed via TTY (text 
telephone) by calling the Federal Information Relay Service at 1-800-
877-8339.

SUPPLEMENTARY INFORMATION: On March 4, 1995, President Clinton issued a 
memorandum to all Federal departments and agencies regarding regulatory 
reinvention. In response to this memorandum, the Department of Housing 
and Urban Development conducted a page-by-page review of its 
regulations to determine which can be eliminated, consolidated, or 
otherwise improved. HUD determined that the regulations for the HOPE 
for Homeownership of Single Family Homes Program (42 U.S.C. 12891-
12898a) (HOPE 3) Program could be improved and streamlined. On 
September 16, 1996 (61 FR 48796), HUD published in the Federal Register 
a final rule that completed a previous rulemaking process on the HOPE 3 
regulations and made streamlining changes to those regulations, where 
prior notice and comment was not required.
    This proposed rule will make additional streamlining changes, 
primarily to the provisions relating to competitions for HOPE 3 
funding. Currently, HUD does not have significant amounts of 
unobligated HOPE 3 funds and does not anticipate additional funds will 
be appropriated for the HOPE 3 program, and the current regulations on 
applications for funding include outdated references and are 
unnecessarily lengthy and prescriptive. By this proposed rule, HUD is 
preserving those regulations only to the extent necessary to ensure 
HUD's ability to run future competitions in the event funds become 
available to make awards under the program.
    Thus, this rule would remove most of those provisions containing 
requirements relating to competitive distributions of HOPE 3 funds. In 
making these distributions, HUD is required to comply with section 102 
of the Department of Housing and Urban Development Reform Act (HUD 
Reform Act) (42 U.S.C. 3545). The requirements of section 102 are 
binding, whether HUD maintains implementing provisions in regulatory 
text in the Code of Federal Regulations (CFR) or in separate published 
notices announcing competitions for funding.
    HUD also notes that, because of recent statutory amendments, direct 
homeownership assistance is now a permanent eligible activity under 
both the HOME Investment Partnerships and Community Development Block 
Grant programs. As a result, families that might have been assisted by 
the HOPE 3 program may be eligible for homeownership assistance through 
the HOME or CDBG programs, instead. This availability of other 
assistance makes future HOPE 3 appropriations and competitions less 
likely.
    This proposed rule would also remove lengthy provisions explaining 
the Cash and Management Information System that is used to disburse 
HOPE 3 grant funds (see Sec. 572.230). The information that would be 
removed is contained in other guidance material and does not need to be 
codified. Additional changes to the part 572 regulations may be made 
later, as conforming amendments in rules that streamline other HUD 
regulations. For example, at the final rule stage, a proposed rule 
published on April 5, 1996 (61 FR 15340), may affect Sec. 572.410, 
Environmental Procedures and Standards.

Other Matters

Regulatory Flexibility Act

    The Secretary, in accordance with the Regulatory Flexibility Act (5 
U.S.C. 605(b)), has reviewed and approved this proposed 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 merely 
recognizes administrative changes in HUD's structure and streamlines 
regulations by removing unnecessary provisions. The rule will have no 
adverse or disproportionate economic impact on small businesses.

Environmental Impact

    This rulemaking does not have an environmental impact. This 
rulemaking simply amends existing regulations by consolidating and 
streamlining provisions and does not alter the environmental effect of 
the regulations being amended. Findings of No Significant Impact with 
respect to the environment were made in accordance with HUD regulations 
in 24 CFR part 50 that implement section 102(2)(C) of the National 
Environmental Policy Act of 1969 (42 U.S.C. 4332) at the time of 
development of regulations implementing the HOPE 3 program. Those 
findings remain applicable to this rule, and are available for public 
inspection between 7:30 a.m. and 5:30 p.m. weekdays in the Office of 
the Rules Docket Clerk, Office of General Counsel, Room 10276, 
Department of Housing and Urban Development, 451 Seventh Street, SW, 
Washington, DC.

Executive Order 12612, Federalism

    The General Counsel, as the Designated Official under section 6(a) 
of Executive Order 12612, Federalism, has determined that this 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. No programmatic or policy changes 
will result from this rule that would affect the relationship between 
the Federal Government and State and local governments.

Executive Order 12606, The Family

    The General Counsel, as the Designated Official under Executive 
Order 12606, The Family, has determined that this rule will not have 
the potential for significant impact on family formation, maintenance, 
or general well-being, and thus is not subject to review under the 
Order. No significant change in existing HUD

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policies or programs, as those policies and programs relate to family 
concerns, will result from promulgation of this rule.

    The Catalog of Federal Domestic Assistance number for this 
program is 14.240.

List of Subjects in 24 CFR Part 572

    Condominiums, Cooperatives, Fair housing, Government property, 
Grant programs--housing and community development, Low and moderate 
income housing, Nonprofit organizations, Reporting and recordkeeping 
requirements.

    Accordingly, for the reasons set out in the preamble, part 572 of 
title 24 of the Code of Federal Regulations is proposed to be amended 
as follows.

PART 572--HOPE FOR HOMEOWNERSHIP OF SINGLE FAMILY HOMES PROGRAM 
(HOPE 3)

    1. The authority citation for part 572 continues to read as 
follows:

    Authority: 42 U.S.C. 3535(d) and 12891.

    2. Section 572.5 is amended by revising the definition of Program 
income, to read as follows:


Sec. 572.5  Definitions.

* * * * *
    Program income means income earned from the program as described in 
parts 84 and 85, as applicable, of this title, except that program 
income does not include proceeds from the sale and resale of 
properties. Such sale and resale proceeds, and interest earned by the 
recipient or its designee on those proceeds, are governed by 
Sec. 572.135 (a) through (c).
* * * * *


Sec. 572.100  [Amended]

    3. Section 572.100 is amended by removing the second sentence of 
paragraph (a)(2).
    4. Section 572.135 is amended by revising paragraph (d), to read as 
follows:


Sec. 572.135  Use of proceeds from sales to eligible families, resale 
proceeds, and program income.

* * * * *
    (d) Program income. Any program income, as defined in Sec. 572.5, 
received by the recipient may be added to the funds committed to the 
grant agreement by HUD and the recipient, in accordance with the 
requirements of parts 84 and 85, as applicable, of this title.
    5. Section 572.210 is amended as follows:
    a. Paragraph (a) is revised;
    b. Paragraphs (b), (c) and (d) are removed;
    c. Paragraphs (f) and (g) are redesignated as paragraphs (b) and 
(c), respectively; and
    d. A new sentence is added at the end of paragraph (b), as 
redesignated, to read as follows:


Sec. 572.210  Implementation grants.

    (a) General authority. Any implementation grants for the purpose of 
carrying out homeownership programs approved under this part will be 
awarded using a selection process and selection criteria to be 
published in a NOFA.
    (b) * * * A previously approved grant amount may not be amended to 
increase the grant amount.
* * * * *
    6. Section 572.230 is revised to read as follows:


Sec. 572.230  Cash and Management Information (C/MI) System.

    Disbursement of HOPE 3 grant funds is managed through HUD's Cash 
and Management Information (C/MI) System for the HOPE 3 program. Funds 
that may be disbursed through the C/MI System include funds awarded to 
the recipient and obligated through the grant approval letter issued by 
HUD. HOPE 3 funds are drawn down by the recipient or its authorized 
designee from a United States Treasury account for the program, using 
the Treasury Automatic Clearinghouse (ACH) System. Any drawdown of HOPE 
3 funds from the United States Treasury account is conditioned upon the 
submission of satisfactory information about the program and compliance 
with other procedures specified by HUD in HUD's forms and issuances 
concerning the C/MI System.
    7. Section 572.300 is revised to read as follows:


Sec. 572.300  Notices of funding availability (NOFAs); grant 
applications.

    When funds are made available for planning grants or implementation 
grants under this part, HUD will publish a NOFA in the Federal 
Register, in accordance with the requirements of part 12 of this title, 
and will select applications for funding on a competitive basis as 
provided in the applicable NOFA.


Secs. 572.305, 572.310, and 572.320  [Removed]

    8. Sections 572.305, 572.310, and 572.320 are removed.
    9. Section 572.420 is amended by revising the second sentence of 
paragraph (a)(1), to read as follows:


 Sec. 572.420  Miscellaneous requirements.

    (a) * * *
    (1) * * * Part 84 of this title (Grants and Agreements with 
Institutions of Higher Education, Hospitals, and Other Nonprofit 
Organizations) and OMB Circular Nos. A-122 (Cost Principles Applicable 
to Grants, Contract and Other Agreements with Nonprofit Institutions) 
and, as applicable, A-21 (Cost Principles for Educational Institutions) 
apply to the acceptance and use of assistance under this part by 
covered organizations, except where inconsistent with the provisions of 
Federal statutes or this part. * * *
* * * * *
    Dated: September 3, 1996.
Andrew Cuomo,
Assistant Secretary for Community Planning and Development.
[FR Doc. 96-25829 Filed 10-9-96; 8:45 am]
BILLING CODE 4210-29-P