[Federal Register Volume 65, Number 80 (Tuesday, April 25, 2000)]
[Rules and Regulations]
[Pages 24374-24375]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-10253]



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Part VI





Department of Housing and Urban Development





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24 CFR Part 882



Section 8 Moderate Rehabilitation Program; Executing or Terminating 
Leases on Moderate Rehabilitation Units When the Remaining Terms of the 
Housing Assistance Payments (HAP) Contract Is for Less Than One Year; 
Final Rule

  Federal Register / Vol. 65, No. 80 / Tuesday, April 25, 2000 / Rules 
and Regulations  

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 882

[Docket No. FR-4472-F-02]
RIN 2577-AB98


Section 8 Moderate Rehabilitation Program; Executing or 
Terminating Leases on Moderate Rehabilitation Units When the Remaining 
Term of the Housing Assistance Payments (HAP) Contract Is for Less Than 
One Year

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

ACTION: Final rule.

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SUMMARY: This final rule adopts an interim rule published on October 4, 
1999, that implemented in the Section 8 Moderate Rehabilitation Program 
statutory language that requires that any initial lease term between an 
owner and a family not extend beyond the term of the HAP contract. 
Before issuance of the October 4, 1999 interim rule, the program 
regulations for the Section 8 Moderate Rehabilitation Program provided 
that the initial lease term between an owner and a family must be for 
at least one year. The regulations were silent on the requisite lease 
term when the Housing Assistance Payments (HAP) contract term expires 
in less than one year.

    This October 4, 1999 interim rule also revised the program 
regulation to allow an owner and a public housing agency (PHA) to 
mutually agree to terminate a unit from the HAP contract if a unit 
becomes vacant and the term of the HAP contract is for less than one 
year.

    The October 1999 interim rule provided a 60-day public comment 
period. No public comments were received and therefore the interim rule 
is adopted without change.


DATES: Effective Date: May 25, 2000.


FOR FURTHER INFORMATION CONTACT: Gerald J. Benoit, Director, Real 
Estate and Housing Performance Division, Office of Public and Assisted 
Housing Delivery, Room 4210, U.S. Department of Housing and Urban 
Development, 451 Seventh Street, SW, Washington, DC 20410-5000; 
telephone: (202) 708-0477 (this is not a toll-free number). Persons 
with hearing or speech impairments may access this number via TTY by 
calling the toll-free Federal Information Relay Service at (800) 877-
8339.

      
      
      

SUPPLEMENTARY INFORMATION:

I. Background

    Section 8(d)(1)(B)(i) of the United States Housing Act of 1937 (42 
U.S.C. 1437f) (1937 Act) requires that the initial lease between the 
tenant and the owner in the Section 8 Moderate Rehabilitation Program 
be for a period of at least one year or the term of the HAP contract, 
whichever is shorter. In most cases, Section 8 Moderate Rehabilitation 
dwelling leases will terminate concurrently with Housing Assistance 
Payments (HAP) contract expirations. In some cases, however, a dwelling 
lease ended prior to the expiration of the Moderate Rehabilitation HAP 
contract. A lease may end prior to the expiration of the Moderate 
Rehabilitation HAP contract as a result of: (1) An action by an owner 
to terminate tenancy in accordance with the lease addendum and program 
regulations; (2) a tenant's action to terminate the lease agreement; or 
(3) an action by a housing authority to terminate the family from the 
program for failure to comply with the family's obligations under the 
Statement of Family Responsibility and the owner chooses to terminate 
the lease with the family.
    On October 4, 1999 (64 FR 53868), HUD issued an interim rule that 
implemented section 8(d)(1)(B)(i) of the 1937 Act. October 4, 1999 
interim rule required that any initial lease term between an owner and 
a family not extend beyond the term of the HAP contract. Before 
issuance of the October 4, 1999 interim rule, the program regulations 
in 24 CFR 882.403(d) provided, in pertinent part, that the initial 
lease between the family and owner must be for at least one year. Under 
these previous regulations, if a lease agreement ended with less than 
twelve months remaining on the HAP contract, Sec. 882.403(d) 
effectively prohibited an owner from reoccupying the unit with a new 
family. The result was that some Section 8 Moderate Rehabilitation 
owners lost rental income on units because the remaining term of the 
HAP contract is for less than twelve months and Sec. 882.512(a) 
prohibited an owner from occupying a unit under a HAP contract with an 
ineligible family (i.e., a family other than one participating in the 
Section 8 Moderate Rehabilitation program).
    Accordingly, the October 4, 1999 interim rule revised 
Sec. 882.403(d) to permit an initial lease for at least one year or the 
term of the HAP contract, whichever is shorter. The interim rule also 
provided that if the initial term of the lease is for less than one 
year because the remaining term of the HAP contract is for less than 
one year, the owner and the PHA may mutually agree to terminate the 
unit from the HAP contract. The provision that any renewal or extension 
of the lease term may not extend beyond the remaining term of the HAP 
contract was not changed by the October 4, 1999 interim rule.
    The October 4, 1999, interim rule provided a 60-day public comment 
period. No public comments were received during this period. 
Accordingly, this final rule adopts the October 4, 1999 interim rule 
without change.

II. Findings and Certifications

Environmental Impact

    A Finding of No Significant Impact with respect to the environment 
for this rule was made in accordance with HUD regulations at 24 CFR 
part 50, which implement section 102(2)(C) of the National 
Environmental Policy Act of 1969 (42 U.S.C. 4332) at the time of the 
interim rule. The Finding of No Significant Impact remains 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 the General Counsel, U.S. 
Department of Housing and Urban Development, Room 10276, 451 Seventh 
Street, SW, Washington, DC 20410.

Federalism

    Executive Order 13132 (entitled ``Federalism'') prohibits, to the 
extent practicable and permitted by law, an agency from promulgating a 
regulation that has federalism implications and either imposes 
substantial direct compliance costs on State and local governments and 
is not required by statute, or preempts State law, unless the relevant 
requirements of section 6 of the Executive Order are met. This final 
rule does not have federalism implications and does not impose 
substantial direct compliance costs on State and local governments or 
preempt State law within the meaning of the Executive Order.

Regulatory Flexibility Act

    This rule will not have a significant economic impact on a 
substantial number of small entities within the meaning of the 
Regulatory Flexibility Act (5 U.S.C. 605(b)), because it does not place 
major burdens on housing authorities or housing owners. This final rule 
adopts the October 4, 1999, interim rule without change. The regulatory 
flexibility analysis provided

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in the interim rule is applicable to this rule. This rulemaking merely 
provides an exception to allow leases for terms of less than twelve 
months under the Moderate Rehabilitation Program.

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 
1531-1538) (UMRA) requires Federal agencies to assess the effects of 
their regulatory actions on State, local, and tribal governments and on 
the private sector. This final rule does not impose, within the meaning 
of the UMRA, any Federal mandates on any State, local, or, tribal 
governments or on the private sector.

List of Subjects for 24 CFR Part 882

    Grant programs--housing and community development, Homeless, Lead 
poisoning, Manufactured homes, Rent subsidies, Reporting and 
recordkeeping requirements.

PART 882--SECTION 8 MODERATE REHABILITATION PROGRAM

    Accordingly, the interim rule amending 24 CFR part 882, which was 
published at 64 FR 53869 on October 4, 1999, is adopted as a final rule 
without change.

    Dated: April 17, 2000.
Harold Lucas,
Assistant Secretary for Public and Indian Housing.
[FR Doc. 00-10253 Filed 4-24-00; 8:45 am]
BILLING CODE 4210-33-P