[Federal Register Volume 64, Number 22 (Wednesday, February 3, 1999)]
[Rules and Regulations]
[Pages 5570-5571]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-2572]



[[Page 5569]]

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Part VI





Department of Housing and Urban Development





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24 CFR Part 990



Operating Fund Rule; Notice of Intent To Establish a Negotiated 
Rulemaking Committee and Notice of First Meeting; Final Rule

  Federal Register / Vol. 64, No. 22 / Wednesday, February 3, 1999 / 
Rules and Regulations  

[[Page 5570]]



DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 990

[Docket No. FR-4425-N-01]


Operating Fund Rule; Notice of Intent To Establish a Negotiated 
Rulemaking Committee and Notice of First Meeting

AGENCY: Office of the Assistant Secretary for Public and Indian 
Housing, HUD.

ACTION: Notice of intent to establish a negotiated Rulemaking Advisory 
Committee and notice of first meeting.

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SUMMARY: The Department of Housing and Urban Development (HUD) is 
establishing a Negotiated Rulemaking Advisory Committee under the 
Federal Advisory Committee Act. The establishment of the committee is 
required by the Quality Housing and Work Opportunity Act of 1998, which 
requires issuance of regulations under the Negotiated Rulemaking Act of 
1990. The purpose of the Committee is to discuss and negotiate a 
proposed rule that would change the current method of determining the 
payment of operating subsidies to public housing agencies (PHAs). The 
Committee will consist of representatives with a definable stake in the 
outcome of a proposed rule. In accordance with section 564 of the 
Negotiated Rulemaking Act of 1990, this notice: (1) Advises the public 
of the establishment of the committee; (2) provides the public with 
information regarding the committee; (3) solicits public comment on the 
proposed membership of the committee; and (4) explains how persons may 
be nominated for membership on the committee.

DATES: Comment due date: March 5, 1999. HUD's tentative plan is to hold 
the first meeting of the Committee on March 23-March 25, 1999.

ADDRESSES: HUD plans to hold the first meeting at the Channel Inn Hotel 
(Captain's Room), 650 Water Street, SW, Washington, DC 20024.
    Interested persons are invited to submit comments regarding the 
Committee and its proposed members to the Regulations Division, Office 
of General Counsel, Room 10276, Department of Housing and Urban 
Development, 431 Seventh Street, SW, Washington, DC 20410-0500. 
Comments or any other communications submitted should consist of an 
original and four copies and refer to the above docket number and 
title. Facsimile (FAX) comments are not acceptable. The docket will be 
available for public inspection and copying between 7:30 a.m. and 5:30 
p.m. weekdays at the above address.

FOR FURTHER INFORMATION CONTACT: Joan DeWitt, Director, Funding and 
Financial Management Division, Public and Indian Housing, Room 4216, 
Department of Housing and Urban Development, 431 Seventh Street, SW, 
Washington, DC 20410-0500; telephone (202) 708-1872 ext. 4035 (this 
telephone numbers 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. Background

    HUD currently uses a formula approach called the Performance 
Funding System (PFS) to distribute operating subsidies to public 
housing agencies (PHAs). A regulatory description of the PFS can be 
found at 24 CFR 990. Generally, the amount of subsidy received by a PHA 
is the difference between projected expenses and projected income, with 
the PFS regulations detailing how these projections will be made. PHAs 
calculate their PFS eligibility annually and submit a request for 
funding as part of their budget process. While the amount varies, this 
subsidy can represent a substantial amount of revenue to a PHA. For 
example, in 1998, HUD distributed over $2.9 billion in operating 
subsidies to PHAs.
    On October 21, 1998, the Congress enacted the Quality Housing and 
Work Responsibility Act of 1998 (Pub. L. 105-276, 112 Stat. 2461, 
approved October 21, 1998) (QHWRA). QHWRA makes sweeping changes to 
HUD's public and assisted housing programs. These changes include the 
establishment of an Operating Fund for the purpose of making assistance 
available to PHAs for the operation and management of public housing. 
The assistance to be made available from that fund is to be determined 
using a formula developed through negotiated rule-making procedures. 
The general effective date of the formula (the beginning date of the 
fiscal year for which PHAs will determine their subsidy eligibility 
using the new formula) is October 1, 1999. Section 519(n)(f) of QHWRA, 
however, permits HUD to extend the effective date for up to six months 
beyond the general effective date.

II. Regulatory Negotiation

    Negotiated rulemaking, or ``neg-reg,'' is a relatively new process 
for HUD. The basic concept of neg-reg is to have the agency that is 
considering drafting a rule bring together representatives of affected 
interests for face-to-face negotiations that are open to the public. 
The give-and-take of the negotiation process is expected to foster 
constructive, creative and acceptable solutions to difficult problems.
    In anticipation of possible Congressional action, HUD entered into 
an interagency agreement in June 1998 with the Federal Mediation and 
Conciliation Service (FMCS) for convening and facilitation services 
associated with a negotiated rulemaking regarding a possible operating 
fund proposed rule. FMCS submitted its Convening Report in November 
1998. The report concluded that it was feasible to assemble the 
committee, and provided a list of individual PHAs and organizations, 
representing a wide range of interests, that are willing and able to 
work within a consensus framework on a new Operating Fund formula. A 
copy of the Convening Report is available for review by contacting the 
Regulations Division, Office of General Counsel, at the phone number 
listed in the ADDRESSES section of this notice.

III. Committee Membership

    The FMCS conveners consulted and interviewed over 40 officials of 
various organizations that would be affected by the operating fund 
rule. The goal was to develop a committee whose membership reflects a 
balanced representation of interested organizations and individuals. 
Three national PHA associations--the Council of Large Public Housing 
Authorities (CLPHA), the National Association of Housing and Renewal 
Officials (NAHRO), and the Public Housing Authority Directors 
Association (PHADA) worked together to suggest executive directors of 
PHAs for committee membership that would reflect the diversity of PHAs 
in terms of size, location, and special circumstances. The national 
associations also indicated a willingness to serve on the committee.
    After reviewing the recommendations of the FMCS conveners, HUD has 
tentatively identified the following list of possible interests and 
parties. This list should be considered tentative, and the final list 
of participants may not include all of these parties. HUD will decide 
on the final list of participants, based upon comments on this Notice, 
as well as its own efforts to identify other entities having an 
interest in the outcome of this rulemaking.


[[Page 5571]]


 Housing Agencies
1. Oakland Housing Authority, Oakland, CA
2. Indianapolis Housing Authority, Indianapolis, IN
3. Pittsburgh Housing Authority, Pittsburgh, PA
4. New York City Housing Authority, NYC, NY
5. Reno Housing Authority, Reno, NV
6. Littleton Housing Authority, Littleton, CO
7. Akron Metro Housing Authority, Akron, OH
8. Chicago Housing Authority, Chicago, IL
9. Atlanta Housing Authority, Atlanta, GA
10. Athens Housing Authority, Athens, GA
11. Puerto Rico Public Housing Authority, San Juan, PR
12. Seattle Housing Authority, Seattle, WA
13. Wilmington Housing Authority, Wilmington, DE
14. York Housing Authority, York, NE
 Tenant Organizations
1. Massachusetts Union of Public Housing Tenants, Needham, MA
2. New Jersey Association of Public and Subsidized Housing Residents, 
Newark, NJ
 Public Interest Groups
1. National Low Income Housing Coalition, Washington, DC
2. Housing and Development Law Institute, Washington, DC
3. Center for Community Change, Washington, DC
 National PHA Associations
1. Public Housing Authority Directors Association (PHADA)
2. National Association of Housing and Renewal Officials (NAHRO)
3. Council of Large Public Housing Authorities (CLPHA)
 Federal Government
1. U.S. Department of Housing and Urban Development

    We invite you to give us comments and suggestions on this tentative 
list of committee members. We do not believe that each potentially 
affected organization or individual must necessarily have its own 
representative. However, we must be satisfied that the group as a whole 
reflects a proper balance and mix of interests. Accordingly, the 
composition of the final list will likely be different from this 
tentative list. Negotiation sessions will be open to members of the 
public, so individuals and organizations that are not members of the 
committee may attend all sessions and communicate informally with 
members of the committee.

IV. Neighborhood and Community Based Groups

    In particular, HUD welcomes and solicits expressions of interest or 
nominations from any groups or individuals that operate on behalf of 
the communities and neighborhoods served by public housing, and 
organizations that represent local officials.

V. Requests for Representation

    If you are interested in serving as a member of the committee or in 
nominating another person to serve as a member of the committee, you 
must submit a written nomination to HUD at the address listed in the 
ADDRESSES section of this notice. Your nomination for membership on the 
committee must include:
    (1) The name of your nominee and a description of the interests the 
nominee would represent;
    (2) Evidence that your nominee is authorized to represent parties 
with the interests the nominee would represent;
    (3) A written commitment that the nominee will actively participate 
in good faith in the development of the rule; and
    (4) The reasons that the parties listed in this notice do not 
adequately represent your interests.
    HUD will determine, in consultation with the FMCS conveners, 
whether a proposed member should be included in the makeup of the 
committee. HUD will make that decision based on whether a proposed 
member would be significantly affected by the proposed rule and whether 
the interest of the proposed member could be represented adequately by 
other members.

VI. Substantive Issues for Negotiation

    The subject and scope of the proposed rule to be considered is the 
development of an operating fund for the purpose of making assistance 
available to PHAs for the operation and management of public housing in 
accordance with the criteria outlined in section 519 of QHWRA.

VII. Final Notice Regarding Committee Establishment

    After reviewing any comments on this Notice and any requests for 
representation, HUD will issue a final notice. That notice will 
announce the final composition of the Negotiated Rulemaking Advisory 
Committee and the firm date, time, and place of the initial meeting.

VIII. Tentative Schedule

    At this time, HUD's tentative plan is to hold the first meeting of 
the committee on March 23-March 25, 1999. On March 23, 1999, the 
meeting is expected to start at 10:00 a.m. and run until completion; on 
March 24, 1999, the meeting is expected to start at 9:00 a.m. and run 
until completion; and on March 25, 1999, the meeting will start at 9:00 
a.m. and run until approximately 3:00 p.m. We plan to hold the meeting 
at the Channel Inn Hotel (Captain's Room), 650 Water Street, SW, 
Washington, DC 20024. The purpose of the meeting will be to orient 
members to the neg-reg process, to establish a basic set of 
understandings and ground rules (protocols) regarding the process that 
will be followed in seeking a consensus, and to begin to address the 
issues. This meeting will be open to the public. In the event that the 
date and times of these meetings are changed, HUD will advise the 
public through Federal Register notice.
    Decisions with respect to future meetings will be made at the first 
meeting and from time to time thereafter. Notices of future meetings 
will be published in the Federal Register.

    Dated: January 19, 1999.
Harold Lucas,
Assistant Secretary for Public and Indian Housing.
[FR Doc. 99-2572 Filed 1-29-99; 4:23 pm]
BILLING CODE 4210-33-P