[Federal Register Volume 73, Number 57 (Monday, March 24, 2008)]
[Notices]
[Pages 15473-15475]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-5817]


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 Notices
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 This section of the FEDERAL REGISTER contains documents other than rules 
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  Federal Register / Vol. 73, No. 57 / Monday, March 24, 2008 / 
Notices  

[[Page 15473]]



DEPARTMENT OF AGRICULTURE

Rural Housing Service


USDA Rural Development Voucher Program

AGENCY: Rural Housing Service, USDA.

ACTION: Notice of USDA Voucher Program Availability.

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SUMMARY: This notice informs the public that the United States 
Department of Agriculture (USDA) has established a demonstration USDA 
Rural Development Voucher Program, as authorized under section 542 of 
the Housing Act of 1949 as amended, (without regard to section 542(b)), 
which is being administered by the USDA. This notice informs the public 
that USDA shall make $4,965,000.00 available for this purpose, as 
appropriated under the Consolidated Appropriations Act, 2008. The 
notice also sets forth the general policies and procedures for use of 
these vouchers.

DATE: March 24, 2008.

FOR FURTHER INFORMATION CONTACT: Stephanie B.M. White, Director, Multi-
Family Housing Portfolio Management Division, Rural Development, United 
States Department of Agriculture, 1400 Independence Avenue, SW., STOP 
0782, Washington, DC 20250-0782, telephone (202) 720-1615. 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

    The Consolidated Appropriations Act, 2008 (Pub. L. 110-161) 
(December 26, 2007) (Consolidated Appropriations Act, 2008), 
appropriates $4,965,000.00 to the USDA for the Rural Development 
Voucher Program as authorized under section 542 of the Housing Act of 
1949, as amended 42 U.S.C. 1471 et seq. (without regard to section 
542(b)).
    The Consolidated Appropriations Act, 2008, provides that the 
Secretary of the United States Department of Agriculture shall carry 
out the USDA Rural Development Voucher Program as follows:

    ``That of the funds made available under this heading, 
$5,000,000 shall be available for rural housing vouchers to any low-
income household (including those not receiving rental assistance) 
residing in a property financed with a section 515 loan which has 
been prepaid after September 30, 2005:
    Provided further, That the amount of such voucher shall be the 
difference between comparable market rent for the section 515 unit 
and the tenant paid rent for such unit: Provided further, That funds 
made available for such vouchers shall be subject to the 
availability of annual appropriations: Provided further, That the 
Secretary shall, to the maximum extent practicable, administer such 
vouchers with current regulations and administrative guidance 
applicable to section 8 housing vouchers administered by the 
Secretary of the Department of Housing and Urban Development 
(including the ability to pay administrative costs related to 
delivery of the voucher funds)''. This notice outlines the process 
for providing voucher assistance to the eligible impacted families 
when an owner prepays a section 515 loan or Agency action results in 
a foreclosure after September 30, 2005.

II. Design Features of the USDA Voucher Program

    This section sets forth the design features of the USDA Rural 
Development Voucher Program, including the eligibility of families, the 
inspection of the units, and the calculation of the subsidy amount.
    Rural Development vouchers under this part are administered by the 
Rural Housing Service, an Agency under the Rural Development mission 
area, in accordance with requirements set forth in, ``The Rural 
Development Voucher Program Guide,'' which can be obtained by 
contacting any Rural Development office. Contact information for Rural 
Development offices can be found at http://offices.sc.egov.usda.gov/locator/app. These requirements are generally based on the housing 
choice voucher program regulations of the United States Department of 
Housing and Urban Development (HUD) set forth at 24 CFR part 982, 
unless otherwise noted by this Notice.
    The Rural Development Voucher Program is intended to offer 
protection to eligible multifamily housing tenants in properties 
financed through Rural Development's section 515 Rural Rental Housing 
Program (515 property) who may be subject to economic hardship through 
prepayment of the Rural Development mortgage. When the owner of a 515 
property pays off the loan, the Rural Development affordable housing 
requirements and rental assistance subsidies generally cease to exist. 
Rents may increase, thereby making the housing unaffordable to tenants. 
Whether or not the rent increases, the tenant will be responsible for 
the full payment of rent. The USDA Rural Development Voucher Program 
applies to any 515 property where the mortgage is paid off prior to the 
maturity date in the promissory note after September 30, 2005. This 
includes foreclosed properties. Tenants in foreclosed properties are 
eligible for a Rural Development voucher under the same conditions as 
properties that go through the standard prepayment process. The Rural 
Development voucher will help tenants by providing a short-term rental 
subsidy, up to 36 monthly payments, that will supplement the tenant's 
rent payment. This short-term subsidy enables a tenant to make an 
informed decision about remaining in the property, moving to a new 
property, or obtaining other financial housing assistance. Low-income 
tenants in the prepaying property are eligible to receive a voucher to 
use at their current rental property, or take to any other rental unit 
in the United States and its territories. In order to utilize a 
voucher, the rental unit must pass a Rural Development health 
inspection, and the owner must be willing to accept a USDA Rural 
Development voucher. USDA Rural Development vouchers cannot be used for 
units in subsidized housing like Section 8 and public housing, where 
two housing subsidies would result. The USDA Rural Development voucher 
may be used for rental units in other properties financed by Rural 
Development, but it cannot be used in combination with the Rural 
Development Rental Assistance program. The USDA Rural Development 
voucher may not be used for the purchase of a home.

1. Family Eligibility

    In order to be eligible for the USDA Rural Development voucher 
under this notice, a family must be residing in the

[[Page 15474]]

section 515 project on the date of the prepayment of the section 515 
loan or upon foreclosure by Rural Development. Furthermore, the date of 
the prepayment or foreclosure must be after September 30, 2005. As 
stated in the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996, the tenant must be a citizen, United States 
non-citizen national, or qualified alien. Rural Development will 
determine if the family is a low-income family on the date of the 
prepayment or foreclosure. When Rural Development determines a family 
is low-income, Rural Development will send the primary tenant a letter 
offering the family a voucher and will enclose a Voucher Obligation 
Form. If the family wants to participate in the USDA Rural Development 
Voucher Program, the tenant has 10 months from the date of prepayment, 
but no later than September 15, 2008, to return the Obligation Request 
Form to the local Rural Development office. A low-income family is a 
family whose annual income does not exceed 80 percent of the median 
income for the area. If Rural Development makes a determination that 
the tenant is ineligible based on income, Rural Development will 
provide administrative appeal rights. The voucher is issued to the 
household in the name of the primary tenant. If the primary tenant dies 
during the term of the voucher, the use of the voucher passes to the 
co-tenant.

2. Obtaining a Voucher

    Rural Development will monitor the prepayment request process or 
foreclosure process, and as part of that process will obtain a rent 
comparability study prior to the date of prepayment or foreclosure. The 
rent comparability study will be used to calculate the amount of 
voucher each tenant is entitled to receive. All tenants will be 
notified of eligibility determinations and voucher calculations by 
Rural Development by the date of prepayment. As previously stated, such 
notice will include a description of the USDA Rural Development Voucher 
Program, an Obligation Request Form, and an offer to participate in the 
USDA Rural Development Voucher Program if the family is eligible to 
receive such voucher. Once the primary tenant returns the Obligation 
Request Form to Rural Development, a voucher will be issued. All 
information necessary for a housing search, explanations of unit 
acceptability, and Rural Development contact information will be 
provided by Rural Development to the tenant at that time.
    The family receiving a USDA Rural Development voucher has an 
initial search period of 60 calendar days to find a housing unit. At 
its discretion, the Agency may grant one or more extensions of the 
initial search period for up to an additional 60 days. The maximum 
voucher search period for any family participating in the USDA Rural 
Development Voucher Program is 120 days. If the family needs and 
requests an extension of the initial search period as a reasonable 
accommodation to make the program accessible to a disabled family 
member, the Agency will extend the voucher search period. If the USDA 
Rural Development voucher remains unused after a period of 150 days 
from issuance, the USDA Rural Development voucher will become void and 
funding will be cancelled. The tenant will no longer be eligible to 
receive a USDA Rural Development voucher.

3. Initial Lease Term

    The initial lease term for the housing unit where the family wishes 
to use its voucher must be for one year.

4. Inspection of Units and Unit Approval

    The inspection standards currently in effect for the Rural 
Development section 515 Multi-Family Housing Program apply to the USDA 
Rural Development Voucher Program.
    Rural Development must inspect the unit and ensure that the unit 
meets the housing inspection standards of the program at 7 CFR 
3560.103. Under no circumstances may Rural Development make voucher 
rental payments for any period of time prior to the date that Rural 
Development physically inspects the unit and determines the unit meets 
the housing inspection standards. In the case of properties financed by 
Rural Development under the Section 515 program, Rural Development may 
accept the results of physical inspections performed no more than one 
year prior to the date of receipt by Rural Development of Form HUD 
52517, ``Request for Tenancy Approval,'' in order to make 
determinations on acceptable housing standards. Before approving a 
family's assisted tenancy or executing a Housing Assistance Payments 
contract, Rural Development must determine that the following 
conditions are met: (1) The unit has been inspected by Rural 
Development and passes the housing standards inspection or has 
otherwise been found acceptable as noted previously; and (2) the lease 
includes the HUD tenancy addendum.
    Once the conditions for a Housing Assistance Payments contract are 
met, Rural Development will approve the unit for leasing. Rural 
Development will then execute with the owner a Housing Assistance 
Payments (HAP) contract, Form HUD-52641. The HAP contract must be 
executed before USDA Rural Development voucher payments can be made. 
While Rural Development must use its best efforts to execute the HAP 
contract on behalf of the family before the beginning of the lease 
term, the HAP contract may be executed up to 60 calendar days after the 
beginning of the lease term. If the HAP contract is executed during 
this 60-day period, Rural Development will pay retroactive housing 
assistance payments to cover the portion of the approved lease term 
before execution of the HAP contract. Any HAP contract executed after 
the 60-day period is untimely and Rural Development will not pay any 
housing assistance payment to the owner for that period. In 
establishing the effective date of the voucher HAP contracts, Rural 
Development may not execute a housing voucher contract that is 
effective prior to the section 515 loan prepayment.

5. Subsidy Calculations for USDA Rural Development Vouchers

    The monthly housing assistance payment for the USDA Rural 
Development Voucher Program is the difference between the comparable 
market rent for the family's former section 515 unit and the tenant 
contribution on the date of the prepayment. The tenant can appeal Rural 
Development's determination of the voucher amount through USDA's 
administrative appeal process, 7 CFR part 11. Since the USDA Rural 
Development voucher amount will be based on the comparable market rent, 
the voucher amount will never exceed the comparable market rent at the 
time of prepayment for the tenant's unit if they choose to stay in-
place. Also, in no event may the USDA Rural Development voucher subsidy 
payment exceed the actual tenant lease rent. The amount of the voucher 
does not change over time. Due to the short-term nature of the USDA 
Rural Development Voucher Program, there are no continued income 
eligibility tests or income recertifications after the family is 
determined income-eligible at the time of prepayment or foreclosure.

6. Mobility and Portability of USDA Rural Development Vouchers

    An eligible family that is issued a USDA Rural Development voucher 
may elect to use the assistance in the same project or may choose to 
move from the property. The USDA Rural Development voucher may be used 
at the prepaid

[[Page 15475]]

property or any other rental unit in the United States and its 
territories that passes Rural Development physical inspection 
standards, and where the owner will accept a USDA Rural Development 
voucher. HUD Section 8 and Federally-assisted public housing is 
excluded from the USDA Rural Development Voucher Program because these 
units are already federally subsidized. Tenants with a USDA Rural 
Development voucher would have to give up the USDA Rural Development 
voucher to accept the assistance at those properties. The USDA Rural 
Development voucher may be used in other properties financed by Rural 
Development, but it cannot be used in combination with the Rural 
Development Rental Assistance Program. Tenants with a USDA Rural 
Development voucher that apply for housing in a Rural Development-
financed property must choose between using the voucher or Rental 
Assistance (RA). If the tenant relinquishes the USDA Rural Development 
voucher in favor of RA, the tenant is not eligible to receive another 
USDA Rural Development voucher.

7. Term of Funding for Rural Development Vouchers

    The USDA Rural Development Voucher Program provides voucher 
assistance for 12 monthly payments, subject to the availability of 
appropriations to the USDA.

8. Non-Discrimination Statement

    ``The U.S. Department of Agriculture (USDA) prohibits 
discrimination in all its programs and activities on the basis of 
race, color, national origin, age, disability, and where applicable, 
sex, marital status, familial status, parental status, religion, 
sexual orientation, genetic information, political beliefs, 
reprisal, or because all or a part of an individual's income is 
derived from any public assistance program. (Not all prohibited 
bases apply to all programs.) Persons with disabilities who require 
alternative means for communication of program information (Braille, 
large print, audiotape, etc.) should contact USDA's TARGET Center at 
(202) 720-2600 (voice and TDD). To file a complaint of 
discrimination write to USDA, Director, Office of Civil Rights, 1400 
Independence Avenue, S.W., Washington, D.C. 20250-9410 or call (800) 
795-3272 (voice) or (202) 720-6382 (TDD). USDA is an equal 
opportunity provider, employer, and lender.''

9. Paperwork Reduction Act

    The information collection requirements contained in this document 
are those of the Housing Choice Voucher Program, which have been 
approved by the Office of Management and Budget (OMB) under the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) and assigned OMB 
control number 2577-0169. In accordance with the Paperwork Reduction 
Act, HUD may not conduct or sponsor, and a person is not required to 
respond to, a collection of information unless the collection displays 
a currently valid OMB control number.

    Dated: March 14, 2008.
Russell T. Davis,
Administrator, Rural Housing Service.
 [FR Doc. E8-5817 Filed 3-21-08; 8:45 am]
BILLING CODE 3410-XV-P