[Federal Register Volume 69, Number 42 (Wednesday, March 3, 2004)]
[Rules and Regulations]
[Pages 10106-10107]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-4649]



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Part II





Department of Housing and Urban Development





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24 CFR Part 200



Changes in Maximum Mortgage Limits for Multifamily Housing; Final Rule

  Federal Register / Vol. 69, No. 42 / Wednesday, March 3, 2004 / Rules 
and Regulations  

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 200

[Docket No. FR-4913-F-01]
RIN 2502-AI19


Changes in Maximum Mortgage Limits for Multifamily Housing

AGENCY: Office of Assistant Secretary for Housing--Federal Housing 
Commissioner, HUD.

ACTION: Final rule.

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SUMMARY: This rule conforms HUD's regulations to a recent statutory 
increase in the amount by which HUD may increase the dollar amount 
limitations on insured mortgages for multifamily housing.

DATES: Effective Date: April 2, 2004.

FOR FURTHER INFORMATION CONTACT: Roger Kramer, Office of Housing, 
Technical Support Division, 451 Seventh Street, SW., Washington, DC 
20410-8000; telephone (202) 708-2866. This is not a toll-free number. 
Persons with hearing or speech impairments may access these numbers 
toll-free through TTY by calling the Federal Information Relay Service 
at (800) 877-8339.

SUPPLEMENTARY INFORMATION:

Background

    Title II of the National Housing Act (12 U.S.C. 1707 et seq.) 
authorizes the Secretary to make exceptions to the maximum mortgage 
amounts in certain Federal Housing Administration (FHA) multifamily 
mortgage insurance programs. Until recently, Title II provided for 
exceptions in amounts of up to a 110 percent increase on a geographical 
basis and up to a 140 percent increase on a project-by-project basis. 
For example, section 207(c)(3) of the National Housing Act, after 
listing the maximum mortgage limits for the program, stated that:

    [T]he Secretary may, by regulation, increase any of the 
foregoing dollar amount limitations contained in this paragraph by 
not to exceed 110 percent in any geographical area where the 
Secretary finds that cost levels so require and not to exceed 140 
percent where the Secretary determines it necessary on a project-by-
project basis. * * *

(12 U.S.C. 1713(c)(3)). Similar language provided the same exceptions 
to maximum mortgage limits in other FHA multifamily insurance programs. 
(See 12 U.S.C. 1715e(b)(2)(B)(i), 1715k(d)(3)(B)(iii)(II), 
1715l(d)(3)(ii)(II), 1715l(d)(4)(ii)(II), 1715v(c)(2)(B), and 
1715y(e)(3)(B).)
    Section 200.15 of HUD's regulations (24 CFR 200.15) provides that 
the FHA Commissioner, acting under authority delegated by the 
Secretary, may increase the dollar amount limitations specified in law 
for insured mortgages ``(a) By not to exceed 110 percent in any 
geographic area in which the Commissioner finds that cost levels so 
require; and (b) By not to exceed 140 percent where the Commissioner 
determines it necessary on a project-by-project basis.''
    Section 302(b) of the FHA Multifamily Loan Limit Adjustment Act of 
2003 (Pub. L. 108-186, approved December 16, 2003) (the Act) revises 
the statutory exceptions to maximum mortgage amounts for the FHA 
multifamily housing programs listed in that section. Section 302(b) 
substitutes 140 percent for the 110 percent exception for any 
geographical area, and substitutes 170 percent for 140 percent as the 
maximum exception allowed for a specific project. The statutory 
revision now allows the Secretary to grant exceptions to maximum 
mortgage limits for certain multifamily housing programs (1) up to 140 
percent in geographical areas where cost levels so require, and (2) up 
to 170 percent where necessary on a project-by-project basis.

This Final Rule

    This final rule conforms HUD's regulation at 24 CFR 200.15 to the 
recent statutory changes made by section 302(b) of the Act. Because HUD 
is simply adopting the new statutory limits without change in order to 
conform its regulation to current law and is not exercising any 
regulatory discretion, public comment is unnecessary.

Findings and Certifications

Justification for Direct Final Rulemaking

    In general, the Department publishes a rule for public comment 
before issuing a rule for effect, in accordance with its own 
regulations on rulemaking, 24 CFR part 10. However, part 10 does 
provide for exceptions from that general rule where the agency finds 
good cause to omit advance notice and public participation. The good 
cause requirement is satisfied when prior public procedure is 
``impracticable, unnecessary, or contrary to the public interest'' (24 
CFR 10.1). In this case, public comment is unnecessary because HUD is 
only conforming its current rule to statutory change. HUD is not 
exercising its administrative discretion in this matter. Therefore, 
there would be no purpose served by accepting public comments on this 
rule.

Regulatory Flexibility Act

    The Secretary, in accordance with the Regulatory Flexibility Act (5 
U.S.C. 605(b)), has reviewed and approved this rule, and in so doing 
certified that this rule will not have a significant economic impact on 
a substantial number of small entities. This rule imposes no new 
obligation of any kind, but only raises the maximum mortgage limits for 
insured mortgages in HUD multifamily programs by percentage amounts.

Environmental Impact

    This final rule is a statutorily required or discretionary 
establishment and review of loan limits, which does not constitute a 
development decision that affects the physical condition of specific 
project areas and building sites. Accordingly, under 24 CFR 
50.19(c)(6), this rule is categorically excluded from environmental 
review under the National Environmental Policy Act of 1969 (42 U.S.C. 
4321 et seq.).

Executive Order 13132, 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.

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 
1531-1538) (UMRA) establishes requirements for 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 any federal mandates on any state, local, or tribal government, 
or on the private sector, within the meaning of UMRA.

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance numbers applicable to 
this rule are 14.112, 14.126, 14.127, 14.134, 14.135, 14.138, 14.139, 
and 14.155.

List of Subjects in Part 200

    Administrative practice and procedure, Claims, Equal employment 
opportunity, Fair housing, Home

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improvement, Housing standards, Lead poisoning, Loan programs--housing 
and community development, Mortgage insurance, Organization and 
functions (Government agencies), Penalties, Reporting and recordkeeping 
requirements, Social security, Unemployment compensation, Wages.

0
For the reasons stated in the preamble, HUD amends 24 CFR 200.15 as 
follows:

PART 200--INTRODUCTION TO FHA PROGRAMS

0
1. The authority citation for part 200 continues to read as follows:

    Authority: 12 U.S.C. 1702-1715z-21; 42 U.S.C. 3535d.

0
2. Revise Sec.  200.15 to read as follows:


Sec.  200.15  Maximum mortgage.

    Mortgages must not exceed either the statutory dollar amount or 
loan ratio limitations established by the section of the Act under 
which the mortgage is insured, except that the Commissioner may 
increase the dollar amount limitations:
    (a) By not to exceed 140 percent, in any geographical area in which 
the Commissioner finds that cost levels so require; and
    (b) By not to exceed 140 percent, or 170 percent in high-cost 
areas, where the Commissioner determines it necessary on a project-by-
project basis.

    Dated: February 24, 2004.
John C. Weicher,
Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 04-4649 Filed 3-2-04; 8:45 am]
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