[Federal Register Volume 67, Number 211 (Thursday, October 31, 2002)]
[Rules and Regulations]
[Pages 66308-66311]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-27681]


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DEPARTMENT OF AGRICULTURE

Rural Housing Service

Rural Business-Cooperative Service

Rural Utilities Service

Farm Service Agency

7 CFR Part 1944

RIN 0575-AC25


Farm Labor Housing Technical Assistance

AGENCY: Rural Housing Service, USDA.

ACTION: Final rule.

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SUMMARY: The Rural Housing Service (RHS) is amending its regulations 
for the Farm Labor Housing (FLH) program. The Housing Act of 1949 
authorizes the RHS to provide financial assistance to private and 
public nonprofit agencies to encourage the development of domestic and 
migrant farm labor housing projects. The nonprofit agencies that 
receive this financial assistance, in turn, provide ``technical 
assistance'' to other organizations to assist them in obtaining loans 
and grants for the construction of farm labor housing. The intended 
effect of this action is to amend the regulations to establish the 
eligibility requirements that nonprofit agencies must meet to receive 
technical assistance grants and how the financial assistance will be 
made available by the RHS.

EFFECTIVE DATE: December 2, 2002.

FOR FURTHER INFORMATION CONTACT: Douglas MacDowell, Senior Loan 
Specialist, Multi-Family Housing Processing Division, Rural Housing 
Service, U.S. Department of Agriculture, STOP 0781, 1400 Independence 
Avenue SW., Washington, DC 20250-0781, Telephone (202) 720-1604.

SUPPLEMENTARY INFORMATION:

[[Page 66309]]

Classification

    This rule has been determined to be not significant for purposes of 
Executive Order 12866 and therefore has not been reviewed by the Office 
of Management and Budget (OMB).

Paperwork Reduction Act

    The information collection requirements contained in this 
regulation have been previously approved by OMB under the provisions of 
44 U.S.C. chapter 35 and this regulation has been assigned OMB control 
number 0575-0181, in accordance with the Paperwork Reduction Act of 
1995. This rule does not impose any new information collection 
requirements from those approved by OMB.

Civil Justice Reform

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. In accordance with this rule: (1) All state and local 
laws and regulations that are in conflict with this rule will be 
preempted; (2) no retroactive effect will be given to this rule; and 
(3) administrative proceedings in accordance with 7 CFR part 11 must be 
exhausted before bringing suit in court challenging action taken under 
this rule.

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub. 
L. 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, RHS 
generally must prepare a written statement, including a cost-benefit 
analysis, for proposed and final rules with ``Federal mandates'' that 
may result in expenditures to State, local, or tribal governments, in 
the aggregate, or to the private sector, of $100 million or more in any 
one year. When such a statement is needed for a rule, section 205 of 
the UMRA generally requires RHS to identify and consider a reasonable 
number of regulatory alternatives and adopt the least costly, more 
cost-effective or least burdensome alternative that achieves the 
objectives of the rule.
    This rule contains no Federal mandates (under the regulatory 
provisions of Title II of the UMRA) for State, local, and tribal 
governments or the private sector. Therefore, this rule is not subject 
to the requirements of section 202 and 205 of the UMRA.

Executive Order 13132, Federalism

    The policies contained in this rule do not have any substantial 
direct effect on states, on the relationship between the national 
government and the states, or on the distribution of power and 
responsibilities among the various levels of government. Nor does this 
rule impose substantial direct compliance costs on state and local 
governments. Therefore, consultation with the states is not required.

Programs Affected

    The affected program is listed in the Catalog of Federal Domestic 
Assistance under Number 10.405, Farm Labor Housing Loans and Grants.

Intergovernmental Consultation

    For the reasons contained in the Final Rule related Notice to 7 CFR 
part 3015, subpart V, this program is subject to Executive Order 12372 
which requires intergovernmental consultation with State and local 
officials. RHS has conducted intergovernmental consultation in the 
manner delineated in RD Instruction 1940-J.

Environmental Impact Statement

    This document has been reviewed in accordance with 7 CFR part 1940, 
subpart G, ``Environmental Program.'' It is the determination of RHS 
that this action does not constitute a major Federal action 
significantly affecting the quality of the human environment and in 
accordance with the National Environmental Policy Act of 1969, Pub. L. 
91-190, an Environmental Impact Statement is not required.

Regulatory Flexibility Act

    This rule has been reviewed with regard to the requirements of the 
Regulatory Flexibility Act (5 U.S.C. 601-612). The undersigned has 
determined and certified by signature of this document that this rule 
will not have a significant economic impact on a substantial number of 
small entities since this rulemaking action does not involve a new or 
expanded program nor does it require any more action on the part of a 
small business than required of a large entity.

Background

    Farmworkers are among the lowest paid workers in the United States 
and often lack decent, safe, sanitary, and affordable housing. RHS's 
FLH program provides loans and grants for farmworker housing and 
related facilities.
    The FLH program is authorized by title V of the Housing Act of 1949 
under section 514 (42 U.S.C. 1484) for loans and section 516 (42 U.S.C. 
1486) for grants. Section 516 also authorizes the RHS to provide 
financial assistance (not more than 10 percent of the section 516 
funds) to encourage the development of domestic and migrant farm labor 
housing projects.
    RHS's FLH program provides funding for both ``on-farm'' and ``off-
farm'' housing. The housing may also be for either seasonal or year-
round occupancy. Off-farm housing, typically apartment complexes, is 
open to farmworkers who work at any farming operation. On-farm housing 
provides housing for the workers of only one farm and is typically 
designed as single family dwellings. Occupancy of both types of housing 
is restricted to United States citizens or permanent resident aliens.
    Off-farm migrant housing serves farmworkers who perform 
agricultural work at one or more locations away from their home base 
throughout the year for periods ranging from a few weeks to several 
months. Rental assistance is available to many tenants of off-farm 
housing to make rents affordable. Off-farm housing is financed with 
section 514 loans and section 516 grants to nonprofit organizations and 
public agencies such as local housing authorities, and with section 514 
loans to limited partnerships in which the general partner is a 
nonprofit entity.
    On-farm housing loans are made to farmers or farm entities to 
provide housing for farmworker families employed by the farm. On-farm 
housing is financed with section 514 loans and is not eligible for 516 
grants. The tenants (farmworkers) who live in on-farm housing are not 
eligible for rental assistance.
    RHS also provides financial assistance to private and public 
nonprofit agencies to encourage the development of domestic and migrant 
farm labor housing projects. The services that are provided by these 
non-profit agencies pursuant to section 516(i) are commonly referred to 
as ``technical assistance.''
    Prior to Fiscal Year (FY) 2000, RHS awarded technical assistance 
``contracts.'' These contracts were awarded for one year periods with 
four option periods that could be exercised at the discretion of the 
Government. In FY 2000, RHS changed the way that FLH technical 
assistance funds were awarded. During FY 2000, RHS awarded technical 
assistance ``grants'' rather than ``contracts.''
    On June 21, 2000, a Request for Proposals (RFP) was published in 
the Federal Register requesting ``grant'' proposals from private and 
public nonprofit agencies. The RFP outlined the application 
requirements and the criteria that would be used to select proposals 
for funding. The RFP also

[[Page 66310]]

established three FLH technical assistance grant regions (the Eastern, 
Central, and Western grant regions) and contained the terms of the 
grants.
    On September 27, 2000, three technical assistance grants were 
awarded. Two of the grants were awarded for the Western grant region 
and the other was awarded for the Central grant region. No grant 
proposals were received for the Eastern grant region. Each of the 
grants has a three year grant period.
    When the RFP was published, comments and suggestions were received 
from interested parties. Some suggested that more than one FY's funding 
should be made available during the three year grant period. Another 
issue was that the Central grant region received less funding than the 
Eastern and Western grant regions. Lastly, one commentor expressed that 
it was unfair to consider an applicant's experience if such experience 
was gained outside of the grant region or to give equal weight to an 
applicant's experience in developing non-farmworker multifamily housing 
to an applicant's experience in developing farmworker housing.
    In the future, RHS intends to periodically publish RFPs that are 
similar to the one that was published on June 21, 2000. When published, 
RHS will have the opportunity to make changes to the way funds are 
distributed, to the minimum performance requirements that must be met, 
or to other terms of the grants. RHS will at that time consider the 
suggestions that have been made. However, this revision to the 
regulation only implements the statutory authority for awarding grants. 
It does not establish the application requirements, the selection 
criteria, the performance standards that must be met, or how funds will 
be distributed when grants are awarded.
    On June 1, 2001, the Agency published a proposed rule in the 
Federal Register (66 FR 29739) to establish the eligibility 
requirements that nonprofit agencies must meet to receive technical 
assistance grants and to establish how the financial assistance will be 
made available by RHS. By this final rule, the Agency is also adding a 
definition of the term ``Technical assistance'' for clarity.

Discussion of Comments

    Two commentors responded during the comment period. The Agency 
wishes to thank the respondents for their comments and suggestions. The 
comments we received are summarized and discussed below.

Eligibility Is Limited to Private or Public Nonprofit Agencies

    One commentor suggested that ``for profit'' organizations should be 
eligible to receive technical assistance grants. However, the statutory 
authority for awarding technical assistance grants (section 516(i) of 
the Housing Act of 1949-42 U.S.C.1486(i)) only authorizes assistance to 
be provided to private or public nonprofit agencies.

Paperwork Requirements and the Application Process

    One commentor suggested that RHS had greatly increased the 
paperwork requirements and the application process. This rule, however, 
does not set forth the application requirements. As stated in the 
proposed rule, ``Requests for Proposals (RFP) may be periodically 
published in the Federal Register'' and ``RFPs will contain the amount 
of funding, the method of allocating or distributing funds, where to 
submit proposals, proposal requirements, the deadline for the 
submission of proposals, the selection criteria, and the grant 
agreement to be entered into between RHS and the grantee.''

List of Subjects in 7 CFR Part 1944

    Farm labor housing, Grant programs--Housing and community 
development, Loan programs--Housing and community development, Migrant 
labor, Nonprofit organizations, Public housing, Rent subsidies, Rural 
housing.

    Therefore, chapter XVIII, title 7, Code of Federal Regulations is 
amended to read as follows:

PART 1944--HOUSING

    1. The authority citation for part 1944 continues to read as 
follows:

    Authority: 5 U.S.C. 301; 42 U.S.C. 1480.

Subpart D--Farm Labor Housing Loan and Grant Policies, Procedures, 
and Authorizations

    2. Section 1944.151 is revised to read as follows:


Sec.  1944.151  Purpose.

    This subpart contains the policies and procedures and delegates 
authority for making initial and subsequent insured loans under section 
514 and grants under section 516 of the Housing Act of 1949, to provide 
housing and related facilities for domestic farm labor. This subpart 
also contains the policies and procedures for making grants under 
section 516 to encourage the development of farm labor housing. Any 
processing or servicing activity conducted pursuant to this subpart 
involving authorized assistance to Rural Housing Service (RHS) 
employees, members of their families, known close relatives, or 
business or close personal associates, is subject to the provisions of 
subpart D of part 1900 of this chapter. Applicants for this assistance 
are required to identify any known relationship or association with an 
RHS employee.
    3. Section 1944.153 is amended by adding, in alphabetical order, a 
definition for ``technical assistance'' to read as follows:


Sec.  1944.153  Definitions.

* * * * *
    Technical assistance. The provision of services by an entity with 
farm labor housing and real estate development capacity to an applicant 
entity who lacks such a capacity. Such assistance may include, but is 
not limited to:
    (1) Performing outreach efforts to inform and recruit potential LH 
applicants.
    (2) Conducting site searches, negotiating and executing property 
acquisitions, and resolving planning and zoning issues.
    (3) Preparing market analyses, feasibility analyses, and financial 
proformas.
    (4) Packaging LH loan and grant applications, as well as 
applications from other funding sources.
    (5) Estimating construction costs and providing oversight during 
construction periods.
* * * * *

    4. Section 1944.157 is amended by redesignating paragraph (c) as 
(d) and by adding a new paragraph (c) to read as follows:


Sec.  1944.157  Eligibility requirements.

* * * * *
    (c) Eligibility of applicant for an LH technical assistance grant. 
To be eligible for an LH technical assistance grant, the applicant 
must:
    (1) Be a private or public nonprofit agency;
    (2) Have the knowledge, ability, technical expertise, or practical 
experience necessary to develop and package loan and grant applications 
for LH under the section 514 and 516 programs; and,
    (3) Possess the ability to exercise leadership, organize work, and 
prioritize assignments to meet work demands in a timely and cost 
efficient manner. The grantee may arrange for other nonprofit agencies 
to provide services on its behalf; however, RHS will expect the grantee 
to provide the overall management necessary to ensure the objectives of 
the grant are met.

[[Page 66311]]

 Nonprofit agencies acting on behalf of the grantee must also meet the 
above stated eligibility requirements.
* * * * *

    5. Section 1944.158 is amended by adding a new paragraph (o) to 
read as follows:


Sec.  1944.158  Loan and grant purposes.

* * * * *
    (o) Encourage the development of farm labor housing. RHS may award 
``technical assistance'' grants to eligible private and public 
nonprofit agencies. These grant recipients will, in turn, assist other 
organizations obtain loans and grants for the construction of farm 
labor housing. Technical assistance services may not be funded under 
both this paragraph and paragraph (i) of this section. In addition, 
technical assistance may not be funded by RHS when an identity of 
interest exists between the technical assistance provider and the loan 
or grant applicant. Requests for Proposals (RFP) may be periodically 
published in the Federal Register by RHS inviting eligible nonprofit 
organizations to submit LH technical assistance grant proposals. RFPs 
will contain the amount of available funding, the method of allocating 
or distributing funds, where to submit proposals, proposal 
requirements, the deadline for the submission of proposals, the 
selection criteria, and the grant agreement to be entered into between 
RHS and the grantee.

    Dated: October 24, 2002.
Arthur A. Garcia,
Administrator, Rural Housing Service.
[FR Doc. 02-27681 Filed 10-30-02; 8:45 am]
BILLING CODE 3410-XV-P