[Federal Register Volume 69, Number 75 (Monday, April 19, 2004)]
[Proposed Rules]
[Pages 21036-21037]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-8724]



[[Page 21035]]

-----------------------------------------------------------------------

Part IV





Department of Housing and Urban Development





-----------------------------------------------------------------------



24 CFR Part 200



Revised Guidelines for Previous Participation Certification; Proposed 
Rule

  Federal Register / Vol. 69, No. 75 / Monday, April 19, 2004 / 
Proposed Rules  

[[Page 21036]]


-----------------------------------------------------------------------

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 200

[Docket No. FR-4870-P-01]
RIN 2502-AI10


Revised Guidelines for Previous Participation Certification

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

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: This proposed rule would revise the regulations to require all 
participants in HUD's Multifamily Housing Programs to file their 
Previous Participation Certificates by a specified date using the 
Active Partner Performance System on HUD's secure Internet site.

DATES: Comment Due Date: May 19, 2004.

ADDRESSES: Interested persons are invited to submit written comments 
regarding this rule to the Regulations Division, Office of General 
Counsel, Room 10276, Department of Housing and Urban Development, 451 
Seventh Street, SW., Washington, DC 20410-0500. Communications should 
refer to the above docket number and title. Facsimile (FAX) comments 
are not acceptable. A copy of each communication submitted will be 
available for public inspection and copying between 8 a.m. and 5 p.m. 
weekdays at the above address.

FOR FURTHER INFORMATION CONTACT: James E. Collins, Management Analyst, 
Housing Policy and Participation Standards Division, Office of the 
Deputy Assistant Secretary for Multifamily Housing, Department of 
Housing and Urban Development, 451 Seventh Street, SW., Washington, DC 
20410-8000; telephone (202) 708-0614, extension 3279 (this is not a 
toll-free number). Hearing- and speech-impaired persons may access this 
number through TTY by calling the toll-free Federal Information Relay 
Service at 800-877-8339.

SUPPLEMENTARY INFORMATION:

I. Background

    The purpose of the Previous Participation Certification process is 
to ensure that prospective participants in HUD's Multifamily Housing 
Programs have a history of carrying out their past financial, legal, 
and administrative obligations in a satisfactory and timely manner. The 
current system requires HUD's business partners that want to 
participate in multifamily housing programs to file a paper Previous 
Participation Certificate using form HUD-2530 together with a 
description of all previous participation in multifamily programs every 
time they wish to do business with HUD.

II. This Proposed Rule

    This proposed rule would amend 24 CFR 200.217(a) to require that 
filing by a specific date of the Previous Participation Certificate by 
participants in HUD's Multifamily Housing Programs be done 
electronically rather than by completing a paper form (form HUD-2530). 
The electronic filing will be accomplished by using a secure Internet-
based application developed by HUD known as the Active Partner 
Performance System (APPS). The rule also specifies with more clarity 
transactions for which a principal or participant in HUD multifamily 
mortgage and project-based subsidy must complete an electronic Previous 
Participation Certificate.
    APPS will provide participants with a secure environment within the 
HUD firewall where participants will record pertinent information about 
their specific relationship to any property. With the use of the APPS 
application, participants will be able to ensure that their individual 
records are complete, correct, and accurate at all times. APPS will 
provide participants with information about the physical condition of 
properties with which they are associated and will highlight any 
problems that may exist. Further, APPS will assist HUD in monitoring 
participants. APPS will allow HUD to maintain a history of 
participants, their various roles in property operations, and 
properties with which they are or were involved.
    A clear benefit of using APPS is that risk assessment of a party's 
new or revised participation will occur faster, as paper is not 
required to be sent back and forth across the country. Risk information 
will be shared automatically with participants, which will make the 
issues resolution process more efficient.

III. Findings and Certifications

Justification for 30-Day Comment Period

    HUD usually provides a 60-day period for the receipt of public 
comments when it issues a proposed rule. Notwithstanding that the 
provision for a 60-day public comment period is not a statutory 
requirement, HUD believes that where a rule provides for a shorter 
comment period than the usual 60 days, the rule should contain a 
justification to support the shorter period. In this instance, the 
principal change to be effected by this rule would merely convert to an 
electronic format the recording of information that currently is 
obtained through a paper form. Since electronic filing has been used by 
participants for some time now, HUD believes that codifying the 
requirement for electronic filing as quickly as possible by, among 
other things, shortening the comment period would prejudice no one and 
make for a more efficient system.

Environmental Impact

    A Finding of No Significant Impact with respect to the environment 
has been 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(2)(C)). The Finding of No Significant 
Impact is available for public inspection between the hours of 8 a.m. 
and 5 p.m. weekdays in the Regulations Division, Office of General 
Counsel, Room 10276, Department of Housing and Urban Development, 451 
Seventh Street, SW., Washington, DC 20410-0500.

Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) 
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 rule does not impose a federal mandate on any 
state, local, or tribal government, or on the private sector, within 
the meaning of the Unfunded Mandates Reform Act of 1995.

Regulatory Flexibility Act

    The Secretary, in accordance with the Regulatory Flexibility Act (5 
U.S.C. 605(b)), has reviewed this rule before publication and by 
approving it certifies that this rule would not have a significant 
economic impact on a substantial number of small entities. There are no 
anti-competitive discriminatory aspects of the rule with regard to 
small entities, and there are not any unusual procedures that would 
need to be complied with by small entities. Notwithstanding HUD's 
determination that this rule would not have a significant effect on a 
substantial number of small entities, HUD specifically invites comments 
regarding any less burdensome alternatives to this rule that will meet 
HUD's objectives as described in this preamble.

Executive Order 13132, Federalism

    Executive Order 13132 (entitled ``Federalism'') prohibits an agency 
from

[[Page 21037]]

publishing any rule that has federalism implications if the rule either 
imposes substantial direct compliance costs on state and local 
governments and is not required by statute, or the rule preempts state 
law, unless the agency meets the consultation and funding requirements 
of section 6 of the executive order. This rule does not have federalism 
implications and does not impose substantial direct compliance costs on 
state and local governments nor preempt state law within the meaning of 
the executive order.

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance number is 14.117.

List of Subjects in 24 CFR Part 200

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

    Accordingly, for the reasons described in the preamble, HUD 
proposes to amend 24 CFR part 200 as follows:

PART 200--INTRODUCTION TO FHA PROGRAMS

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

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

    2. Amend Sec.  200.217 by revising paragraph (a) to read as 
follows:


Sec.  200.217  Filing of previous participation certificate on 
prescribed form.

    (a) Effective [effective date of final rule to be inserted at 
publication of final rule], or on such later date as may be allowed by 
HUD, all participants/principals in HUD multifamily mortgage and 
project based subsidy programs must submit an electronic Previous 
Participation Certificate (form HUD-2530) via HUD's secure web server 
as a condition prerequisite to new or revised participation. Prior to 
this date, participants are required to file form HUD-2530 as a 
condition prerequisite to new or revised participation. Filing 
requirements are as prescribed by the Assistant Secretary for Housing--
Federal Housing Commissioner at the occurrence of any of the events 
below:
    (1) With an Application for a Site Appraisal/Market Analysis 
Letter, Feasibility Letter, Conditional Commitment for Mortgage 
Insurance, or Firm Commitment for Mortgage Insurance, whichever 
application is first filed, for projects to be financed or refinanced 
with mortgages insured under the National Housing Act;
    (2) With an Application for a Fund Reservation for projects 
financed or to be financed with direct loans or capital advances under 
section 202 of the Housing Act of 1959 (Housing for the Elderly and 
Handicapped);
    (3) With an Application for a Fund Reservation for projects 
financed or to be financed with direct loans or capital advances under 
section 811 of the Cranston-Gonzales National Affordable Housing Act 
(Supportive Housing for Persons with Disabilities);
    (4) With the first request for a reservation of funds for 
assistance payments for projects in which 20 percent or more of the 
units are to receive a subsidy described in Sec.  200.213(c);
    (5) With an Application for any Transfer of Physical Assets;
    (6) With a request to assume any existing Housing Assistance 
Payments Contract, Interest Reduction Contract, Rent Supplement 
Contract, or Rental Assistance Payments Contract;
    (7) With a request to change ownership of a property regulated or 
controlled by a HUD ``use agreement'';
    (8) With an application or request to change the approved lessee 
operating a nursing home, assisted living, or skilled care facility;
    (9) With a bid to purchase a project being sold at foreclosure by 
HUD or by a foreclosure commissioner acting for HUD, when the terms of 
the sale permit HUD to disapprove a bidder;
    (10) With a bid to purchase a Secretary-owned project;
    (11) With a bid to purchase a mortgage note held by the 
Commissioner;
    (12) At least 30 days prior to the date of any proposed 
substitution or addition of a new participant or principal in an 
existing project, such as management agents, LLC members, directors, or 
partners, or proposed participation in a different capacity from that 
previously approved for the same project;
    (13) At least 30 days prior to the proposed acquisition by an 
existing limited partner, stockholder, or any principal of additional 
interests resulting in a total interest of at least 25 percent 
(partners) or 10 percent (non-partners); or
    (14) Certificates of participation must be submitted for interests 
acquired by any party or organization by inheritance or court decree 
within 30 days after said acquisition or decree, but will not be 
subject to review or disapproval.
* * * * *

    Dated: March 22, 2004.
Sean Cassidy,
General Deputy Assistant Secretary for Housing.
[FR Doc. 04-8724 Filed 4-16-04; 8:45 am]
BILLING CODE 4210-27-P