[Federal Register Volume 65, Number 248 (Tuesday, December 26, 2000)]
[Notices]
[Pages 81630-81639]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-32619]



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Part III





Department of Agriculture





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Rural Housing Service



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Housing Programs: Multi-Family, Single Family, Rural Rental, Farm 
Labor, and Preservation; Grants and Funding Availability; Notices

  Federal Register / Vol. 65, No. 248 / Tuesday, December 26, 2000 / 
Notices  

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DEPARTMENT OF AGRICULTURE

Rural Housing Service


Notice of Availability of Funds; Multi-Family Housing, Single 
Family Housing

AGENCY: Rural Housing Service, USDA.

ACTION: Notice.

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SUMMARY: The Rural Housing Service (RHS) announces the availability of 
housing funds for fiscal year 2001 (FY 2001). This action is taken to 
comply with 42 U.S.C. 1490p, which requires that RHS publish in the 
Federal Register notice of the availability of any housing assistance.

EFFECTIVE DATE: December 26, 2000.

FOR FURTHER INFORMATION CONTACT: Michael S. Feinberg, Chief, Loan 
Origination Branch, Single Family Housing, Direct Loan Division, Stop 
0783, U.S. Department of Agriculture, 1400 Independence Ave., SW, 
Washington, D.C., 20250, telephone (202) 720-3214. (This is not a toll 
free number).

SUPPLEMENTARY INFORMATION:

Programs Affected

    The following programs are subject to the provisions of Executive 
Order 12372 that requires intergovernmental consultation with State and 
local officials. These programs or activities are listed in the Catalog 
of Federal Domestic Assistance under Nos.

10.405 Farm Labor Housing (LH) Loans and Grants
10.410 Very Low to Moderate Income Housing Loans
10.411 Rural Housing Site Loans and Self-Help Housing Land Development 
Loans
10.415 Rural Rental Housing Loans
10.417 Very Low Income Housing Repair Loans and Grants
10.420 Rural Self-Help Housing Technical Assistance
10.427 Rural Rental Assistance Payments
10.433 Rural Housing Preservation Grants
10.442 Housing Application Packaging Grants

Discussion of Notice

    Part 1940, subpart L of 7 CFR contains the ``Methodology and 
Formulas for Allocation of Loan and Grant Program Funds.'' The 
following guidance has been provided to our State offices on FY 2001 
appropriations and access to funds. Separate guidance has been provided 
to our State offices for assistance available in our Multi- and Single-
Family Housing programs as follows:

Multi-Family Housing (MFH)

I. General

    A. This provides guidance on MFH funding for the Rural Rental 
Housing program (RRH) for FY 2001. Allocation computations have been 
performed in accordance with 7 CFR 1940.575 and 1940.578. For FY 2001, 
State Directors, under the Rural Housing Assistance Grants (RHAG), will 
have the flexibility to transfer their initial allocations of budget 
authority between the Single Family Housing (SFH) section 504 Rural 
Housing Grants and section 533 Housing Preservation Grant (HPG) 
programs.

B. MFH Loan and Grant Levels for FY 2001 Are as Follows

MFH Loan Programs Credit Sales: $1,782,582
Section 514 Farm Labor Housing (LH) loans: $28,522,532
Section 515 Rural Rental Housing (RRH) loans: $114,321,087
Section 521 Rental Assistance (RA): $680,000,000
Section 516 LH grants: $15,000,000 (does not include carryover)
Sections 525 Technical and Supervisory Assistance grants (TSA) and 509 
Housing Application Packaging grants (HAPG) (Shared between single and 
multi-family housing): $1,687,543 (includes carryover)
Section 533 Housing Preservation grants (HPG): $8,000,000 (does not 
include carryover)
Section 538 Guaranteed Rural Rental Housing program: $100,000,000 (does 
not include carryover)
Processing Worker Housing Grants: $5,000,000

II. Funds Not Allocated to States

A. Credit Sales Authority

    For FY 2001, $1,782,582 will be set aside for credit sales to 
program and nonprogram buyers. Credit sale funding will not be 
allocated by State.

B. Section 538 Guaranteed Rural Rental Housing Program

    Guaranteed loan funds will be made available under a Notice of 
Funding Availability (NOFA) being published in the Federal Register. 
Additional guidance will be provided at that time.

III. Farm Labor Housing (LH) Loans and Grants

    This is a new single funding account for the farm labor housing 
program that includes both loans and grants. The Administrator has the 
authority to transfer funds between the two programs. Upon NOFA closing 
the Administrator will evaluate the responses and determine proper 
distribution of funds between loans and grants.

A. Section 514 Farm LH Loans

    1. These loans are funded in accordance with 7 CFR 1940.579(a).
FY 2001 Appropriation: $28,522,532
Available for Off-Farm Loans: $23,522,000
Available for On-Farm Loans: $2,000,000
National office Reserve: $3,000,532
    2. Off-farm loan funds will be made available under a NOFA being 
published in the Federal Register. Additional guidance will be provided 
in the NOFA.

B. Section 516 Farm LH Grants

    1. Grants are funded in accordance with 7 CFR 1940.579(b). 
Unobligated prior year balances and cancellations will be added to the 
amount shown.
FY 2001 Appropriation: $15,000,000
Available for LH Grants for Off-Farm: $10,000,000
Available for Technical Assistance Grants: $1,500,000
National office Reserve: $3,500,000
    2. Labor Housing grant funds for Off-Farm will be made available 
under a NOFA being published in this Federal Register. Additional 
guidance will be provided in the NOFA.
    3. Technical assistance grants will be made available under a NOFA 
being published in this Federal Register. Additional guidance will be 
provided in the NOFA.
    C. Processing Worker Housing Grant funds in the amount of $5 
million will be made available under a Notice of Funding Availability 
(NOFA) that will be published later this fiscal year. Additional 
guidance will be provided in the NOFA.
    D. Labor Housing Rental Assistance (RA) will be held in the 
National office for use with LH loan and grant applications. RA is only 
available with an LH loan of at least 5 percent of the total 
development cost. Projects without a LH loan cannot receive RA.

IV. Section 515 RRH Loan Funds

FY 2001 section 515 Rural Rental Housing allocation (Total): 
$114,321,087
New Construction funds and set-asides: $49,000,000
New construction loans: $16,980,753
Set-aside for nonprofits: $10,288,998
Set-aside for underserved counties and colonias: $5,716,054
Earmark for EZ, EC, or REAP Zones: $14,514,195
State RA designated reserve: $1,500,000
Rehab and repair funds and equity: $55,000,000

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Rehab and repair loans: $50,000,000
Designated equity loan reserve: $5,000,000
General reserve: $10,321,087

A. New Construction Loan Funds

    New construction loan funds will be made available using a national 
NOFA being published in the Federal Register. Upon closing of the NOFA, 
States will submit a list, in rank order of the eligible projects.

B. National Office New Construction Set-asides

    The following legislatively mandated set-asides of funds are part 
of the National office set-aside:
1. Nonprofit Set-Aside
    An amount of $10,288,998 has been set aside for nonprofit 
applicants. All Nonprofit loan proposals must be located in designated 
places as defined in RD Instruction 1944-E.
2. Underserved Counties and Colonias Set-Aside
    An amount of $5,716,054 has been set aside for loan requests to 
develop units in the underserved 100 most needy counties or colonias as 
defined in section 509(f) of the Housing Act of 1949 as amended. 
Priority will be given to proposals to develop units in colonias or 
tribal lands.
3. EZ, EC or REAP Zone Earmark
    An amount of $14,514,195 has been earmarked for loan requests to 
develop units in EZ or EC communities or REAP Zones until June 30, 
2001.

C. Rental Assistance (RA)

    Limited new construction RA will be held in the National office for 
use with section 515 Rural Rental Housing loans.

D. Designated Reserves for State RA

    An amount of $1.5 million of section 515 loan funds has been set 
aside for matching with projects in which an active State sponsored RA 
program is available. The State RA program must be comparable to the 
RHS RA program.

E. Repair and Rehabilitation Loans

    Tenant health and safety continues to be the top priority. Repair 
and rehabilitation funds must be first targeted to RRH facilities that 
have physical conditions that affect the health and safety of tenants 
and subsequently made available to facilities that have deferred 
maintenance. All funds will be held in the National office and will be 
distributed based upon indicated rehabilitation needs in the MFH survey 
conducted in October 2000.

F. Designated Reserve for Equity Loans

    An amount of $5 million has been designated for the equity loan 
preservation incentive described in RD Instruction 1965-E. The $5 
million will be further divided into $4 million for equity loan 
requests currently on the pending funding list and $1 million to 
facilitate the transfer of properties from for-profit owners to 
nonprofit corporations and public bodies. Funds for such transfers 
would be authorized only for for-profit owners who are currently on the 
pending funding list who agree to transfer to nonprofit corporations or 
public bodies rather than to remain on the pending list. If 
insufficient transfer requests are generated to utilize the full $1 
million set aside for nonprofit and public body transfers, the balance 
will revert to the existing pending equity loan funding list.

G. General Reserve

    There is one general reserve fund of $10,321,087. Some examples of 
immediate allowable uses include, but are not limited to, hardships and 
emergencies, RH cooperatives or group homes, or RRH preservation.

V. Section 533 Housing Preservation Grants (HPG)

Total Available: $8,000,000
Less General Reserve: $800,000
Less Earmark for EZ, EC or REAP Zones: $600,000
Total Available for Distribution: $6,600,000
    Amount available for allocation. See end of this Notice for HPG 
State allocations. Fund availability will be announced in a NOFA being 
published in the Federal Register.
    The amount of $600,000 is earmarked for EZ, EC or REAP Zones until 
June 30, 2001.

Single Family Housing (SFH)

I. General

A. This Notice Provides SFH Allocations for FY 2001

    Allocation computations have been made in accordance with 7 CFR 
1940.563 through 1940.568. Information on basic formula criteria, data 
source and weight, administrative allocation, pooling of funds, and 
availability of the allocation are located on a chart at the end of 
this notice.

B. The SFH Levels Authorized for FY 2001 are as Follows

Section 502 Guaranteed Rural Housing (RH) loans
Nonsubsidized Guarantees: $3,144,568,810
Section 502 Direct RH loans
Very low-income subsidized loans: $469,479,450
Low-income subsidized loans: $597,519,300
Credit sales (Non program): $10,000,000
Section 504 housing repair loans: $32,395,598
Section 504 housing repair grants: $30,000,000
Section 509 compensation for construction defects: $755,821
Section 523 mutual and self-help housing grants: $34,000,000
Section 523 Self-Help Site Loans: $5,008,976
Section 524 RH site loans: $5,128,000
Section 306C Water and waste disposal grants: $1,099,297
Section 525 Supervisory and technical assistance and section 509 
Housing Application Packaging Grants Total Available for single and 
multi-family: $1,687,543
Natural disaster funds (Section 502 loans): $10,495,428
Natural disaster funds (Section 504 loans): $12,590,353
Natural disaster funds (Section 504 grants): $7,464,372

    Carryover funds are included in the balance.
    Does not include North Carolina Elderly Demonstration Program.
    Includes $1,000,000 for EZ/EC and REAP communities until June 30, 
2001.

C. SFH Funding not Allocated to States are

1. Credit Sale Authority
    Credit sale funds are available only for non-program sales of Real 
Estate Owned (REO) property.
2. Section 509 Compensation for Construction Defects
    All claims for compensation for construction defects must be 
submitted to the National office for authorization prior to approval.
3. Section 523 Mutual and Self-Help Technical Assistance Grants
    $34 million has been appropriated for section 523 Mutual and Self-
Help Technical Assistance Grants. Of these funds, $1 million is 
earmarked for EZ, EC or REAP Zones until June 30, 2001. The State 
Director must request funding approval from the National office for all 
requests. A technical review and analysis must be completed by the 
Technical and Management Assistance (T&MA) contractor on all 
predevelopment, new, and existing (refunding) grant applications.

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4. Section 523 Mutual and Self-Help Site Loans and Section 524 RH Site 
Loans
    The State Director must request funding authority from the National 
office prior to obligating loan funds.
5. Section 306C WWD Grants to Individuals in Colonias
    The objective of the section 306C WWD individual grant program is 
to facilitate the use of community water or waste disposal systems for 
the residents of the colonias along the U.S.-Mexico border.
    The total amount available to Arizona, New Mexico, and Texas will 
be $1,099,297 for FY 2001. This amount includes the carryover 
unobligated balance of $99,297 and the transferred amount of $1.0 
million from the Rural Utilities Service (RUS) to RHS for processing 
individual grant applications. These States will have access to the 
equal quarterly allocation distributions.
6. Section 525 Technical and Supervisory Assistance (TSA) and Section 
509 Housing Application Packaging Grants (HAPG)
    One million dollars of new funds and $687,543 of carry-over funds 
from previous years remain available for the TSA and HAPG programs. 
State Directors should submit proposals from potential applicants to 
the National office for review and concurrence prior to authorizing an 
application. The 29 eligible States under HAPG that have active 
grantees operating will be able to access up to $5,000 for section 502 
or 504 loan and grant programs in order to continue operations. Reserve 
requests will be considered on a first-come, first-served basis.
7. Natural Disaster Funds
    Funds are available until exhausted to those States that have 
received a Presidential Declaration.
8. Deferred Mortgage Payment Demonstration
    There is no FY 2001 funding provided for deferred mortgage 
authority or loans for deferred mortgage assumptions.
9. Section 502 Direct Funds for Families Not Qualifying for Payment 
Assistance
    Funds from State's allocation may be used for qualified very low- 
and low-income applicants when the payment assistance formula shows 
there is no need for the subsidy.

II. State Allocations

A. Section 502 Nonsubsidized Guaranteed RH (GRH) Loans

1. Amount Available for Allocation
Total Available: $3,144,568,810
Less National office General Reserve: $704,948,167
Less Special Outreach Area Reserve: $300,120,643
Basic Formula--Administrative Allocation: $2,137,500,000
2. National office General Reserve
    The Administrator may restrict access to this reserve for States 
not meeting their goals in special outreach areas.
3. Reservation of Funds
    Because it is anticipated that demand will exceed available funds, 
States must use the reservation of funds system per Sec. 1980.351 of RD 
Instruction 1980-D.
4. Special Outreach Areas
    FY 2001 GRH funding is allocated to States in two funding streams 
(70/30) similar to the 60/40 income split for direct SFH funds. Seventy 
percent of GRH funds may be used in any eligible area. Thirty percent 
of GRH funds are to be used in special outreach areas. Special outreach 
areas are counties with median incomes at or below the State's 
nonmetropolitan median income. Each funding stream will independently 
be subject to pooling.
5. National Office Special Area Outreach Reserve
    A special outreach area reserve fund has been established at the 
National office. Funds from this reserve may only be used in special 
outreach areas.
6. Suballocation by the State Director
    The State Director may retain funds at the State office level or 
suballocate to the Area or Field office level.

B. Section 502 Direct RH Loans

1. Amount Available for Allocation
Total Available: $1,066,998,755
Less Required Set Aside for Underserved Counties and Colonias: 
$53,349,937
EZ, EC and REAP Earmark: $38,757,160
Less General Reserve: $146,500,000
Administrator's Reserve: $30,000,000
Hardships & Homelessness: $3,500,000
Homeownership Partnership: $90,000,000
Rural Housing Demonstration Program: $3,000,000
Program funds for the sale of REO properties: $20,000,000
Less Designated Reserve for Self-Help: $125,000,000
Basic Formula Administrative Allocation: $703,391,658
2. Reserves
    a. State Office Reserve. State Directors must maintain an adequate 
reserve to fund the following applications:
    (i) Hardship and homeless applicants based upon historical data and 
projected demand. This shall include the direct section 502 loan and 
section 504 loan and grant programs.
    (ii) The State's 25 percent portion of funds for Mutual Self-Help 
loans.
    (iii) Subsequent loans for essential improvements or repairs and 
transfers with assumptions.
    (iv) Financing for the purchase of program REOs when the National 
office reserve has been exhausted.
    (v) States will leverage an amount equal to 25 percent of their 
initial low-income allocation and 5 percent of their initial very low-
income allocation with funding from other sources. For example if a 
State receives an initial low-income allocation of $900,000 the amount 
to be leveraged from other sources would be $225,000 ($900,000  x  25 
percent) for a total RHS and other funding source of $1,125,000 
($900,000 + $225,000).
    (vi) Areas targeted by the State according to its strategic plan.
    b. National Office Reserves.
    (i) General Reserve. The National office has a general reserve of 
$146.5 million. Of this amount, the Administrator's reserve is $30 
million. One of the purposes of the Administrator's reserve will be for 
loans in Indian Country. Indian Country is defined as land inside the 
boundaries of Indian reservations, communities made up mainly of Native 
Americans, Indian trust and restricted land, and tribal allotted lands. 
The remaining reserves will be established as follows:
    (ii) Hardship and Homelessness Reserve. $3.5 million has been set 
aside for hardships and homeless.
    (iii) Homeownership Partnership. Ninety million dollars has been 
set aside for Homeownership Partnerships. These funds will be used to 
expand existing partnerships and create new partnerships, such as the 
following:
    (A) Department of Treasury, Community Development Financial 
Institutions (CDFI)--Funds will be available to fund leveraged loans 
made in partnership with the Department of Treasury CDFI participants.
    (B) Rural Home Loan Partnership (RHLP). Partnership initiatives 
established to carry out the objectives of the National Partners in 
Homeownership including the RHLP and other strategies or initiatives.

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    (iv) Rural Housing Demonstration Program. Three million dollars has 
been set aside for innovative demonstration initiatives.
    (v) Program credit sales. Twenty million dollars has been set aside 
for program sales of REO property. There will be no State distribution 
of program credit sale authority, rather funds will be available on a 
first-come, first-served basis.
    c. Designated Reserve for Self-Help. One hundred twenty-five 
million dollars has been set aside for matching funds to assist 
participating Self-Help applicants. The matching funds were established 
on the basis of the National office contributing 75 percent from the 
National office reserve and States contributing 25 percent of their 
allocated section 502 RH funds.
    d. Underserved Counties and Colonias. An amount of $53,349,937 has 
been set aside for the 100 underserved counties and colonias.
    e. Empowerment Zone (EZ) and Enterprise Community (EC) Earmark. An 
amount of $38,757,160 has been earmarked until June 30, 2001 for loans 
in EZ, EC or REAP Zones. Further information will follow.
    f. Reserve Requests. All National office reserve requests should be 
submitted by the State Director to the National office on a case-by-
case basis.
    g. State Office Pooling. If pooling is conducted within a State, it 
must not take place within the first 30 calendar days of the first, 
second, or third quarter. (There are no restrictions on pooling in the 
fourth quarter.)
    h. Suballocation by the State Director. The State Director may 
suballocate to each area office using the methodology and formulas 
required by 7 CFR part 1940, subpart L. If suballocated to the area 
level, the Rural Development Manager will make funds available on a 
first-come, first-served basis to all offices at the field or area 
level. No field office will have its access to funds restricted without 
the prior written approval of the Administrator.

C. Section 504 Housing Loans and Grants

    Section 504 grant funds are included in the Rural Housing 
Assistance Grant program (RHAG) in the FY 2001 appropriation.
1. Amount available for allocation
    Section 504 Loans
Total Available: $32,395,598
Less 5% for 100 Underserved Counties and Colonias: $1,619,780
EZ, EC or REAP Zone Earmark: $1,287,968
Less General Reserve: $1,500,000
Basic Formula--Administrative Allocation: $27,987,850
    Section 504 Grants
Total Available: $30,000,000
Less 5% for 100 Underserved Counties and Colonias: $1,500,000
Less EZ, EC or REAP Earmark: $600,000
Less General Reserve: $1,500,000
    Basic Formula--Administrative
Allocation: $26,400,000
2. Reserves and Set-Asides
    a. State Office Reserve. State Directors must maintain an adequate 
reserve to handle all anticipated hardship applicants based upon 
historical data and projected demand.
    b. Underserved Counties and Colonias. Approximately $1.62 million 
and $1.5 million have been set aside for the 100 underserved counties 
and colonias until June 30, 2001 for the section 504 loan and grant 
programs, respectively.
    c. Empowerment Zone (EZ) and Enterprise Community (EC) Earmark 
(Loan Funds Only). Approximately $1.288 million and $600,000 have been 
earmarked through June 30, 2001 for EZ, EC or REAPs for the section 504 
loan and grant programs, respectively.
    d. National Office Reserve. $1.5 million for section 504 loan 
hardships and $1.5 million for section 504 grant extreme hardships have 
been set-aside in the general reserve. For section 504 grants, an 
extreme hardship case is one requiring a significant priority in 
funding, ahead of other requests, due to severe health or safety 
hazards, or physical needs of the applicant.

 Information on Basic Formula Criteria, Data Source and Weight, Administrative Allocation, Pooling of Funds, and
                                         Availability of the Allocation
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                                             Section 502
             Description                    nonsubsidized        Section 502 Direct RH    Section 504 loans and
                                         guaranteed RH loans             loans                    grants
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1. Basic formula criteria, data        See 7 CFR 1940.563(b)..  See 7 CFR 1940.565(b)..  See 7 CFR 1940.566(b)
 source, and weight.                                                                      and 1940.567(b).
2. Administrative Allocation:
    Western Pacific Area.............  $1,000,000.............  $1,000,000.............  $1,000,000 loan.
                                                                                         $500,000 grant.
3. Pooling of funds:
    a. Mid year pooling..............  If necessary...........  If necessary...........  If necessary.
    b. Year-end pooling..............  August 17, 2001........  August 17, 2001........  August 17, 2001.
    c. Underserved counties &          N/A....................  June 30, 2001..........  June 30, 2001.
     colonias.
    d. EZ, EC or REAP................  N/A....................  June 30, 2001..........  June 30, 2001.
    e. Credit sales..................  N/A....................  June 30, 2001..........  N/A.
4. Availability of the allocation:
    a. first quarter.................  50 percent.............  50 percent.............  50 percent.
    b. second quarter................  75 percent.............  70 percent.............  70 percent.
    c. third quarter.................  90 percent.............  90 percent.............  90 percent.
    d. fourth quarter................  100 percent............  100 percent............  100 percent.
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    1. Data derived from the 1990 U.S. Census was provided to each 
State by the National office on August 12, 1993.
    2. Due to the absence of Census data.
    3. All dates are tentative and are for the close of business (COB). 
Pooled funds will be placed in the National office reserve and made 
available administratively. The Administrator reserves the right to 
redistribute funds based upon program performance.
    4. Funds will be distributed cumulatively through each quarter 
listed until the National office year-end pooling date.

    Dated: December 15, 2000.
James C. Kearney,
Administrator, Rural Housing Service.
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[FR Doc. 00-32619 Filed 12-22-00; 8:45 am]
BILLING CODE 3410-XV-C