[Federal Register Volume 73, Number 161 (Tuesday, August 19, 2008)]
[Notices]
[Pages 48368-48374]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-19084]


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DEPARTMENT OF AGRICULTURE

Rural Housing Service


Notice of Funding Availability (NOFA): Section 515 Multi-Family 
Housing Preservation Revolving Loan Fund (PRLF) Demonstration Program 
for Fiscal Year 2008

AGENCY: Rural Housing Service, USDA.

ACTION: Notice.

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Overview Information

SUMMARY: The Rural Housing Service of Rural Development announces the 
availability of funds and the timeframe to submit applications for 
loans to private non-profit organizations, or such non-profit 
organizations' affiliate loan funds and State and local housing finance 
agencies, to carry out a demonstration program to provide revolving 
loans for the preservation and revitalization of low-income Multi-
Family Housing (MFH). Housing that is assisted by this demonstration 
program must be financed by Rural Development through its MFH loan 
program under Sections 515, 514 and 516 of the Housing Act of 1949. The 
goals of this demonstration program will be achieved through loans made 
to intermediaries. The intermediaries will establish their programs for 
the purpose of providing loans to ultimate recipients for the 
preservation and revitalization of low income Sections 515, 514 and 516 
MFH as affordable housing.

DATES: The deadline for receipt of all applications in response to this 
NOFA is 5 p.m., Eastern Time, October 20, 2008. The application closing 
deadline is firm as to date and hour. Rural Development will not 
consider any application that is received after the closing deadline. 
Applicants intending to mail applications must provide sufficient time 
to permit delivery on or before the closing deadline. Acceptance by a 
post office or private mailer does not constitute delivery. Facsimile, 
and postage due applications will not be accepted.

FOR FURTHER INFORMATION CONTACT: Henry Searcy, Jr., Senior Loan 
Specialist, Multi-Family Housing Processing Division, STOP 0781 (Room 
1263-S), or Bonnie Edwards-Jackson, Senior Loan Specialist, Multi-
Family Housing Processing Division, STOP 0781 (Room 1239-S), U.S. 
Department of Agriculture, Rural Housing Service, 1400 Independence 
Avenue, SW., Washington, DC 20250-0781 or by telephone at (202) 720-
1753 or (202) 690-0759, TDD (302) 857-3585 or via e-mail at 
[email protected] or [email protected]. (Please note 
the phone numbers are not toll free numbers.)

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

    Under the Paperwork Reduction Act, 44 U.S.C. 3501 (2005) et seq., 
OMB must approve all ``collections of information'' by Rural 
Development. The Act defines ``collection of information'' as a 
requirement for ``answers to * * * identical reporting or recordkeeping 
requirements imposed on ten or more persons * * *.'' (44 U.S.C. 
3502(3)(A)) Because this NOFA will receive less than 10 respondents, 
the Paperwork Reduction Act does not apply.

Programs Affected

    This program is listed in the Catalog of Federal Domestic 
Assistance under Number 10.415.

Overview

    The Agriculture, Rural Development, Food and Drug Administration, 
and Related Agencies Appropriations Act, 2008 (Act) (Division A of Pub. 
L. 110-161, December 26, 2007) provided funding for, and authorizes 
Rural

[[Page 48369]]

Development to, establish a revolving loan fund demonstration program 
for the preservation and revitalization of the Sections 515, 514 and 
516 Multi-Family Housing portfolio. The Multi-Family Housing program is 
authorized by Sections 514, 515 and 516 of the Housing Act of 1949 and 
provides Rural Development the authority to make loans for low income 
Multi-Family Housing, farm labor housing, farm labor housing, and 
related facilities.

Program Administration

I. Funding Opportunities Description

    This NOFA requests applications from eligible applicants for loans 
to establish and operate revolving loan funds for the preservation of 
low-income MFH within the Rural Development Sections 515, 514 and 516 
Multi-Family Housing portfolio. Rural Development's regulations for the 
section 514, 515 and 516 Multi-Family Housing Program are published at 
7 CFR part 3560.
    Housing that is constructed or repaired must meet the Rural 
Development design and construction standards and the development 
standards contained in 7 CFR part 1924, subparts A and C, respectively. 
Once constructed, Section 515 Multi-Family Housing must be managed in 
accordance with the program's management regulation, 7 CFR part 3560, 
subpart C. Tenant eligibility is limited to persons who qualify as a 
very low-, or low-, household or who are eligible under the 
requirements established to qualify for housing benefits provided by 
sources other than Rural Development, such as U.S. Department of 
Housing and Urban Development, Section 8 assistance or Low Income 
Housing Tax Credit assistance, when a tenant receives such housing 
benefits. Additional tenant eligibility requirements are contained in 7 
CFR 3560.152.

II. Award Information

    The Act, made funding available for loans to private non-profit 
organizations, or such non-profit organizations' affiliate loan funds 
and State and local housing finance agencies, to carry out a housing 
demonstration program to provide revolving loans for the preservation 
of Sections 515, 514 and 516 Multi-Family Housing portfolio. The total 
amount of funding available for this program is $6,421,642.00. Loans to 
intermediaries under this demonstration program shall have an interest 
rate of no more than one percent and the Secretary of Agriculture may 
defer the interest and principal payment to Rural Development for up to 
three years during the first three years of the loan. The term of such 
loans shall not exceed 30 years. Funding priority will be given to 
entities with equal or greater matching funds from third parties, 
including housing tax credits for rural housing assistance and to 
entities with experience in the administration of revolving loan funds 
and the preservation of Multi-Family Housing.

III. Eligibility Information

Applicant Eligibility
    (1) Eligibility requirements--Intermediary.
    (a) The types of entities which may become intermediaries are 
private non-profit organizations, which may include faith based 
organizations, or such non-profit organizations' affiliate loan funds 
and State and local housing finance agencies.
    (b) The intermediary must have:
    (i) The legal authority necessary for carrying out the proposed 
loan purposes and for obtaining, giving security, and repaying the 
proposed loan.
    (ii) A proven record of successfully assisting low-income Multi-
Family Housing projects. Such record will include recent experience in 
loan making and loan servicing that is similar in nature to the loans 
proposed for the PRLF demonstration program and must provide 
documentation of a delinquency and loss rate not which does not exceed 
four percent. The applicant will be responsible for providing such 
information to Rural Development.
    (iii) A staff with loan making and servicing experience.
    (iv) A plan showing Rural Development, that the ultimate recipients 
will only use the funds to preserve low-income Multi-Family Housing 
projects which may include a purchase through a transfer and assumption 
of Sections 515, 514 and 516 housing.
    (c) No loans will be extended to an intermediary unless:
    (i) There is adequate assurance of repayment of the loan evidenced 
by the fiscal and managerial capabilities of the proposed intermediary.
    (ii) The amount of the loan, together with other funds available, 
is adequate to complete the preservation or revitalization of the 
project.
    (iii) At least 51 percent of the outstanding interest or membership 
in any non public body intermediary must be composed of citizens of the 
United States or individuals who reside in the United States after 
being legally admitted for permanent residence. The non public body 
intermediary will submit a self certifying letter of compliance with 
its application.
    (iv) The intermediary's prior calendar year audit indicates an 
unqualified audited opinion which provides a statement relating to the 
accuracy of the financial statements.
    (d) Intermediaries, and the principals of the intermediaries, must 
not be suspended, debarred, or excluded based on the ``List of Parties 
Excluded From Federal Procurement and Nonprocurement Programs.'' In 
addition, intermediaries and their principals must not be delinquent on 
Federal debt or be Federal judgments debtors.
    (e) The intermediary and its principal officers (including 
immediate family) must have no legal or financial interest in the 
ultimate recipient.
    (f) The intermediary's Debt Service Coverage Ratio (DSCR) must be 
greater than 1.25 for the fiscal year immediately prior to the year of 
application. The DSCR is the financial ratio the loan committee will 
use to determine an applicant's capacity to borrow and service 
additional debt.
    The loan committee will use Earnings Before Interest and Taxes 
(EBIT) to determine DSCR. EBIT is determined by adding net income or 
net loss to depreciation and interest expense. The loan committee will 
compare the principal and interest payment multiplied by the DSCR to 
the EBIT derived from the applicant's consolidated income statement. 
For example, if an applicant requests a loan amount of $2,000,000 at a 
one percent interest rate amortized over 30 years, the principal and 
interest payments will be $77,193, annually. Therefore, an applicant 
who requests $2,000,000 needs an EBIT of at least $96,491.00 ($77,193 x 
1.25). Only debt service from unrestricted revolving loans will be 
considered in the above calculation. An unrestricted loan is an account 
in which the accumulated revenues are not dictated by a donor or 
sponsor.
    Only eligible applicants will be scored and ranked. Funding 
priority will be given to entities with equal or greater matching 
funds, including housing tax credits for rural housing assistance. 
Refer to the Selection Criteria section of the NOFA for further 
information on funding priorities.
    (g) Intermediaries that have received one or more PRLF loans may 
apply for and be considered for subsequent PRLF loans provided.
    (h) At least 80 percent of each of an intermediary's PRLF loans 
must have

[[Page 48370]]

been disbursed to eligible ultimate recipients.
    (i) Intermediaries requesting subsequent loans must meet the 
requirements of section III (2) of this NOFA.
    (j) The delinquency rate of the outstanding loans of the 
intermediary's PRLF revolving fund do not exceed 4 percent.
    (k) The intermediary is in compliance with all applicable 
regulations and its loan agreements with Rural Development.
    (l) Subsequent loans will not exceed $1 million each and not more 
than one loan will be approved by Rural Development for an intermediary 
in any single fiscal year unless the request is authorized by a PRLF 
appropriation.
    (m) Total outstanding PRLF indebtedness of an intermediary to Rural 
Development will not exceed $15 million at any time.
    (2) Eligibility requirements--Ultimate recipients.
    (a) To be eligible to receive loans from the PRLF, ultimate 
recipients must:
    (i) Currently have a Rural Development Section 515, 514 loans and 
516 grant for the property to be assisted by the PRLF demonstration 
program, or be a transferee of such a loan before receiving any 
benefits from the PRLF demonstration program.
    (ii) Be unable to provide funding to preserve and revitalize 
existing Sections 515, 514 or 516 properties from its own resources 
and, except for State or local public agencies and Indian tribes, be 
unable to obtain the necessary credit from other sources upon terms and 
conditions the applicant could reasonably be expected to fulfill.
    (iii) Certify that the ultimate recipient along with its principal 
officers (including their immediate family), hold no legal or financial 
interest or in the intermediary.
    (iv) Be in compliance with all Rural Development program 
requirements or have an Agency approved workout plan in place which 
will correct a non-compliance status.
    (b) Any delinquent debt to the Federal Government including a non-
tax judgment lien, by the ultimate recipient or any of its principals, 
shall cause the proposed ultimate recipient to be ineligible to receive 
a loan from the PRLF. PRLF loan funds may not be used to satisfy the 
delinquency. The ultimate recipient cannot be currently debarred or 
suspended from Federal Government programs.

Equal Opportunity and Nondiscrimination Requirements

    (1) In accordance with the Fair Housing Act, Title VI of the Civil 
Rights Act of 1964, the Equal Credit Opportunity Act, the Age 
Discrimination Act of 1975, Executive Order 12898, the Americans with 
Disabilities Act, and Section 504 of the Rehabilitation Act of 1973, 
neither the intermediary nor Rural Development will discriminate 
against any employee, proposed intermediary or proposed ultimate 
recipient on the basis of sex, marital status, race, familial status, 
color, religion, national origin, age, physical or mental disability 
(provided the proposed intermediary or proposed ultimate recipient has 
the capacity to contract), because all or part of the proposed 
intermediary's or proposed ultimate recipient's income is derived from 
public assistance of any kind, or because the proposed intermediary or 
proposed ultimate recipient has in good faith exercised any right under 
the Consumer Credit Protection Act, with respect to any aspect of a 
credit transaction anytime Rural Development loan funds are involved.
    (2) The policies and regulations contained in 7 CFR part 1901, 
subpart E apply to this program.
    (3) The Rural Housing Service (RHS) Administrator will assure that 
equal opportunity and nondiscrimination requirements are met in 
accordance with the Fair Housing Act, Title VI of the Civil Rights Act 
of 1964, the Equal Credit Opportunity Act, the Age Discrimination Act 
of 1975, Executive Order 12898, the Americans with Disabilities Act, 
and Section 504 of the Rehabilitation Act of 1973.
    (4) All housing must meet the accessibility requirements found at 7 
CFR 3560.60(d).

Other Administrative Requirements

    (1) The following policies and regulations apply to loans to 
intermediaries made in response to this NOFA:
    (a) PRLF intermediaries will be required to provide Rural 
Development with the following reports:
    (i) An annual audit;
    (A) The dates of the audit report period need not coincide with 
other reports on the PRLF. Audit reports shall be due 90 days following 
the audit period. Audits must cover all of the intermediary's 
activities. Audits will be performed by an independent certified public 
accountant. An acceptable audit will be performed in accordance with 
Generally Accepted Government Auditing Standards (GAGAS) and include 
such tests of the accounting records as the auditor considers necessary 
in order to express an unqualified audited opinion on the financial 
condition of the intermediary.
    (B) It is not intended that audits required by this program be 
separate from audits performed in accordance with State and local laws 
or for other purposes. To the extent feasible, the audit work for this 
program should be done in connection with these other audits. 
Intermediaries covered by Office Management Budget Circular A-133 
should submit audits made in accordance with that circular.
    (ii) Quarterly or semiannual performance reports (due to Rural 
Development 30 days after the end of the fiscal quarter or half);
    (A) Performance reports will be required quarterly during the first 
year after loan closing. Thereafter, reports will be required 
semiannually. Also, Rural Development may resume requiring quarterly 
reports if the intermediary becomes delinquent in repayment of its loan 
or otherwise fails to fully comply with the provisions of its workout 
plan or Loan Agreement, or Rural Development determines that the 
intermediary's PRLF is not adequately protected by the current 
financial status and paying capacity of the ultimate recipients.
    (B) These reports shall contain information only on the PRLF, or if 
other funds are included, the PRLF portion shall be segregated from the 
others; and in the case where the intermediary has more than one PRLF 
from Rural Development, a separate report shall be made for each PRLF.
    (C) The reports will include OMB Standard Form 269, Financial 
Status Report and OMB Standard Form 272, Federal Cash Transaction 
Report. These reports will provide information on the intermediary's 
lending activity, income and expenses, financial condition and a 
summary of names and characteristics of the ultimate recipients the 
intermediary has financed.
    (iii) Annual proposed budget for the following year; and
    (iv) Other reports as Rural Development may require from time to 
time regarding the conditions of the loan.
    (b) Security will consist of a pledge by the intermediary of all 
assets now or hereafter placed in the PRLF, including cash and 
investments, notes receivable from ultimate recipients, and the 
intermediary's security interest in collateral pledged by ultimate 
recipients. Except for good cause shown, Rural Development will not 
obtain assignments of specific assets at

[[Page 48371]]

the time a loan is made to an intermediary or ultimate recipient. The 
intermediary will covenant that, in the event the intermediary's 
financial condition deteriorates or the intermediary takes action 
detrimental to prudent fund operation or fails to take action required 
of a prudent lender, the intermediary will provide additional security, 
execute any additional documents, and undertake any reasonable acts 
Rural Development may request to protect Rural Development's interest 
or to perfect a security interest in any asset, including physical 
delivery of assets and specific assignments to Rural Development. All 
debt instruments and collateral documents used by an intermediary in 
connection with loans to ultimate recipients may be assignable.
    (c) RHS may consider, on a case by case basis, subordinating its 
security interest on the ultimate recipient's property to the lien of 
the intermediary so that Rural Development has a junior lien interest 
when an independent appraisal verifies the Rural Development 
subordinated lien will continue to be fully secured.
    (d) The term of the loan to an ultimate recipient may not exceed 
the remaining term of the Rural Development loan.
    (e) When loans are made to ultimate recipients for equity purposes, 
restrictive-use provisions must be incorporated, as outlined in 7 CFR 
part 3560.662.
    (f) The policies and regulations contained in 7 CFR part 1901, 
subpart F regarding historical and archaeological properties apply to 
all loans funded under this NOFA.
    (g) The policies and regulations contained in 7 CFR part 1940, 
subpart G regarding environmental assessments apply to all loans to 
ultimate recipients funded under this NOFA. Loans to intermediaries 
under this program will be considered a categorical exclusion under the 
National Environmental Policy Act, requiring the completion of Form RD 
1940-22, ``Environmental Checklist for Categorical Exclusions,'' by 
Rural Development.
    (h) An ``Intergovernmental Review,'' will be conducted in 
accordance with the procedures contained in 7 CFR part 3015, subpart V, 
if the applicant is a cooperative.
    (1) The intermediary agrees to the following:
    (a) To obtain written Rural Development approval, before the first 
lending of PRLF funds to an ultimate recipient, of:
    (i) All forms to be used for relending purposes, including 
application forms, loan agreements, promissory notes, and security 
instruments; and
    (ii) The intermediary's policy with regard to the amount and form 
of security to be required.
    (b) To obtain written approval from Rural Development before making 
any significant changes in forms, security policy, or the 
intermediary's workout plan. Rural Development may approve changes in 
forms, security policy, or workout plans at any time upon a written 
request from the intermediary and determination by Rural Development 
that the change will not jeopardize repayment of the loan or violate 
any requirement of this NOFA or other Rural Development regulations. 
The intermediary must comply with the workout plan approved by Rural 
Development so long as any portion of the intermediary's PRLF loan is 
outstanding;
    (c) To allow Rural Development to take a security interest in the 
PRLF, the intermediary's portfolio of investments derived from the 
proceeds of the loan award, and other rights and interests as Rural 
Development may require;
    (d) To return, as an extra payment on the loan any funds that have 
not been used in accordance with the intermediary's workout plan by a 
date two years from the date of the loan agreement. The intermediary 
acknowledges that Rural Development may cancel the approval of any 
funds not yet delivered to the intermediary if funds have not been used 
in accordance with the intermediary's workout plan within the two year 
period. Rural Development, at its sole discretion, may allow the 
intermediary additional time to use the loan funds by delaying 
cancellation of the funds by not more than three additional years. If 
any loan funds have not been used by five years from the date of the 
loan agreement, the approval will be canceled for any funds that have 
not been delivered to the intermediary and the intermediary will 
return, as an extra payment on the loan, any funds it has received and 
not used in accordance with the workout plan. In accordance with the 
Rural Development approved promissory note, regular loan payments will 
be based on the amount of funds actually drawn by the intermediary.
    (3) The intermediary will be required to enter into a Rural 
Development approved loan agreement and promissory note. The 
intermediary will receive a 30-year loan at a one percent interest 
rate. The loan can be deferred for up to three years.
    (4) Loans made to the PRLF ultimate recipient must meet the intent 
of providing decent, safe, and sanitary rural housing and be consistent 
with the requirements of Title V of the Housing Act of 1949.
    (5) When an intermediary proposes to make a loan from the PRLF to 
an ultimate recipient, Rural Development concurrence is required prior 
to final approval of the loan. The intermediary must submit a request 
for Rural Development concurrence of a proposed loan to an ultimate 
recipient. Such request must include:
    (a) Certification by the intermediary that:
    (i) The proposed ultimate recipient is eligible for the loan;
    (ii) The proposed loan is for eligible purposes;
    (iii) The proposed loan complies with all applicable statutes and 
regulations; and
    (iv) Prior to closing the loan to the ultimate recipient, the 
intermediary and its principal officers (including immediate family) 
hold no legal or financial interest in the ultimate recipient, and the 
ultimate recipient and its principal officers (including immediate 
family) hold no legal or financial interest in the intermediary.
    (b) Copies of sufficient material from the ultimate recipient's 
application and the intermediary's related files, to allow Rural 
Development to determine the:
    (i) Name and address of the ultimate recipient;
    (ii) Loan purposes;
    (iii) Interest rate and term;
    (iv) Location, nature, and scope of the project being financed;
    (v) Other funding included in the project;
    (vi) Nature and lien priority of the collateral; and
    (vii) Environmental impacts of this action. This will include an 
original Form RD 1940-20, ``Request for Environmental Information,'' 
completed and signed by the intermediary. Attached to this form will be 
a statement stipulating the age of the building to be rehabilitated and 
a completed and signed FEMA Form 81-93, ``Standard Flood Hazard 
Determination.'' If the age of the building is over 50 years or if the 
building is either on or eligible for inclusion in the National 
Register of Historic Places, then the intermediary will immediately 
contact Rural Development to begin Section 106 consultation with the 
State Historic Preservation Officer. If the building is located within 
a 100-year flood plain, then the intermediary will immediately contact 
Rural Development to analyze any effects as outlined in 7 CFR part 
1940, subpart G, exhibit C. The intermediary will assist Rural

[[Page 48372]]

Development in any additional requirements necessary to complete the 
environmental review.
    (c) Such other information as Rural Development may request on 
specific cases.
    (6) Upon receipt of a request for concurrence in a loan to an 
ultimate recipient Rural Development will:
    (a) Review the material submitted by the intermediary for 
consistency with Rural Development's preservation and revitalization 
principles which include the following:
    (i) There is a continuing need for the property in the community as 
affordable housing. If Rural Development determines there is no 
continuing need for the property the ultimate recipient is ineligible 
for the loan;
    (ii) When the transaction is complete, the property will be owned 
and controlled by eligible Section 515 borrowers;
    (iii) The transaction will address the physical needs of the 
property;
    (iv) Existing tenants will not be displaced because of increased 
post transaction rents;
    (v) Post transaction basic rents will not exceed comparable market 
rents; and
    (vi) Any equity loan amount will be supported by a market value 
appraisal.
    (b) Issue a letter concurring with the loan when all requirements 
have been met or notify the intermediary in writing the reasons for 
denial when Rural Development determines it is unable to concur with 
the loan.

IV. Application and Submission Information

    The application process will be in two steps: First, all applicants 
will submit proposals to the National Office for loan committee review. 
The initial loan committee will determine if the borrower is eligible, 
score, and rank the applicants according to the criteria established in 
this NOFA. Only eligible borrowers will be scored. The loan committee 
will select proposals for further processing. In the event that a 
proposal is selected for further processing and the applicant declines, 
the next highest ranked unfunded applicant may be selected.
    Second, after the loan is obligated to the intermediary but prior 
to the loan closing, the State Office in the applicant's residence or 
State where the applicant will be doing its intermediary work will 
provide written approval of all forms to be used for relending 
purposes, including application forms, loan agreements, promissory 
notes, and security instruments. Additionally, the State Office will 
provide written approval of the applicant's binding policy with regard 
to the amount and form of security to be required.
    If an application is accepted for further processing and the loan 
closed, the applicant will be required to submit and comply with the 
terms of its workout plan which describes how the money will be used, 
the loan agreement, the promissory note and any other loan closing 
documents. At the time of loan closing, Rural Development and loan 
recipient shall enter into a loan agreement and a promissory note 
acceptable to Rural Development.
Application Requirements
    The application must contain the following:
    (1) A summary page, that is double-spaced and not in narrative 
form, that lists the following items:
    (a) Applicant's name.
    (b) Applicant's Taxpayer Identification Number.
    (c) Applicant's address.
    (d) Applicant's telephone number.
    (e) Name of applicant's contact person, telephone number, and 
address.
    (f) Amount of loan requested.
    (2) Form RD 4274-1, ``Application for Loan (Intermediary Relending 
Program).''
    (3) A written workout plan and other evidence Rural Development 
requires to demonstrate the feasibility of the intermediary's program 
to meet the objectives of this demonstration program. The plan must, at 
a minimum:
    (a) Document the intermediary's ability to administer this 
demonstration program in accordance with the provisions of this NOFA. 
In order to adequately demonstrate the ability to administer the 
program, the intermediary must provide a complete listing of all 
personnel responsible for administering this program along with a 
statement of their qualifications and experience. The personnel may be 
either members or employees of the intermediary's organization or 
contract personnel hired for this purpose. If the personnel are to be 
contracted for, the contract between the intermediary and the entity 
providing such service will be submitted for Rural Development review, 
and the terms of the contract and its duration must be sufficient to 
adequately service Rural Development loan through to its ultimate 
conclusion. If Rural Development determines the personnel lack the 
necessary expertise to administer the program, the loan request will be 
denied;
    (b) Document the intermediary's ability to commit financial 
resources under the control of the intermediary to the establishment of 
the demonstration program. This should include a statement of the 
sources of non-Rural Development funds for administration of the 
intermediary's operations and financial assistance for projects;
    (c) Demonstrate a need for loan funds. As a minimum, the 
intermediary should identify a sufficient number of proposed and known 
ultimate recipients to justify Agency funding of its loan request, or 
include well developed targeting criteria for ultimate recipients 
consistent with the intermediary's mission and strategy for this 
demonstration program, along with supporting statistical or narrative 
evidence that such prospective recipients exist in sufficient numbers 
to justify Rural Development funding of the loan request;
    (d) Include a list of proposed fees and other charges it will 
assess to the ultimate recipients;
    (e) Provide documentation to Rural Development the intermediary has 
secured commitments of significant financial support from public 
agencies and private organizations or have received tax credits for the 
calendar year prior to this NOFA;
    (f) Include the intermediary's plan (specific loan purposes) for 
relending the loan funds. The plan must be of sufficient detail to 
provide Rural Development with a complete understanding of what the 
intermediary will accomplish by lending the funds to the ultimate 
recipient and the complete mechanics of how the funds will flow from 
the intermediary to the ultimate recipient. The service area, 
eligibility criteria, loan purposes, fees, rates, terms, collateral 
requirements, limits, priorities, application process, method of 
disposition of the funds to the ultimate recipient, monitoring of the 
ultimate recipient's accomplishments, and reporting requirements by the 
ultimate recipient's management must at least be addressed by the 
intermediary's relending plan;
    (g) Provide a set of goals, strategies, and anticipated outcomes 
for the intermediary's program. Outcomes should be expressed in 
quantitative or observable terms such as low-income housing complexes 
rehabilitated or low-income housing units preserved, and should relate 
to the purpose of this demonstration program; and
    (h) Provide specific information as to whether and how the 
intermediary will ensure that technical assistance is made available to 
ultimate recipients and potential ultimate recipients. Describe the 
qualifications of the technical assistance providers, the nature of 
technical assistance that will be available, and expected and committed 
sources of funding for technical

[[Page 48373]]

assistance. If other than the intermediary itself, describe the 
organizations providing such assistance and the arrangements between 
such organizations and the intermediary.
    (4) A pro forma balance sheet at start-up and projected balance 
sheets for at least three additional years; and projected cash flow and 
earnings statements for at least three years supported by a list of 
assumptions showing the basis for the projections. The projected 
earnings statement and balance sheet must include one set of 
projections that shows the PRLF must extend to include a year with a 
full annual installment on the PRLF loan.
    (5) A written agreement of the intermediary to Rural Development 
agreeing to the audit requirements.
    (6) Form RD 400-4, ``Assurance Agreement.''
    (7) Complete organizational documents, including evidence of 
authority to conduct the proposed activities.
    (8) Latest unqualified audit report.
    (9) Form RD 1910-11, ``Applicant Certification Federal Collection 
Policies for Consumer or Commercial Debts.''
    (10) Form AD-1047, ``Certification Regarding Debarment, Suspension, 
and other Responsibility Matters--Primary Covered Transactions.''
    (11) Exhibit A-1 of RD Instruction 1940-Q, ``Certification for 
Contracts, Grants, and Loans.''
    (12) Copies of the applicant's tax returns for each of the three 
years prior to the year of application, and most recent audited 
financial statements.
    (13) A separate one-page information sheet listing each of the 
``Selection the Applicants' Criteria'' contained in this NOFA, followed 
by the page numbers of all relevant material and documentation that is 
contained in the proposal that supports these criteria. Applicants are 
also encouraged, but not required; to include a checklist of all of the 
application requirements and to have their application indexed and 
tabbed to facilitate the review process.
    (14) Consolidated financial statements for the year prior to this 
NOFA.
    (15) A borrower authorization statement allowing Rural Development 
the authorization to verify past and present earnings with the preparer 
of the intermediary's financial statements.
Funding Restrictions
    No loans made to a single intermediary applicant under this 
demonstration program may not exceed $2,125,000 and any such loan may 
be limited by geographic area so that multiple loan recipients are not 
providing similar services to the same service areas. All PRLF loans 
will have an obligation expiration period of two years from the date of 
obligation.
    All PRLF loans will have an obligation expiration period of two 
years from the date of obligation. Prior fiscal years PRLF loans that 
were obligated and not closed within the above obligation period must 
be de-obligated to allow more immediate program use unless a six month 
extension is granted by the National Office.
    Loans made to the PRLF ultimate recipient must meet the intent of 
providing decent, safe, and sanitary rural housing and be consistent 
with the requirements of Title V of the Housing Act of 1949, as 
amended.
    Submission address. Applications should be submitted to USDA Rural 
Housing Service; Attention: Henry Searcy, Jr., Senior Loan Specialist, 
Multi-Family Housing Processing Division STOP 0781 (Room 1263-S), or 
Bonnie Edwards-Jackson, Senior Loan Specialist, Multi-Family Housing 
Processing Division, STOP 0781 (Room 1239-S), U.S. Department of 
Agriculture, Rural Housing Service, 1400 Independence Avenue, SW., 
Washington, DC 20250-0781 or by telephone at (202) 720-1753 or (202) 
690-0759 , TDD (302) 857-3585 or via e-mail, [email protected] 
or [email protected]. (Please note the phone numbers are not 
toll free numbers.)

V. Application Review Information

    All applications will be evaluated by a loan committee. The loan 
committee will make recommendations to the Rural Housing Service 
Administrator concerning preliminary eligibility determinations and for 
the selection of applications for further processing based on the 
selection criteria contained in this NOFA and the availability of 
funds. The Administrator will inform applicants of the status of their 
application within 30 days of the loan application closing date set 
forth in this NOFA.
Selection Criteria
    Selection criteria points will be allowed only for factors 
evidenced by well documented, reasonable plans which provide assurance 
that the items have a high probability of being accomplished. The 
points awarded will be as specified in paragraphs (1) through (4) of 
this section. In each case, the intermediary's application must provide 
documentation that the selection criteria have been met in order to 
qualify for selection criteria points. If an application does not cover 
one of the categories listed, it will receive no points for that 
criteria.
    (1) Other funds. Points allowed under this paragraph are to be 
based on documented successful history or written evidence that the 
funds are available.
    (a) The intermediary will obtain non-Rural Development loan or 
grant funds or provide housing tax credits (measured in dollars) to pay 
part of the cost of the ultimate recipients' project cost. The 
Intermediary shall pledge as collateral its PRLF Revolving Fund, 
including its portfolio of investments derived from the proceeds of 
other funds and this loan award. Points for the amount of funds from 
other sources are as follows:
    (i) At least 10 percent but less than 25 percent of the total 
development cost (as defined in 7 CFR part 3560 Section 3560.11)--5 
points;
    (ii) At least 25 percent but less than 50 percent of the total 
project cost--10 points; or
    (iii) 50 percent or more of the total project cost--15 points.
    (b) The intermediary will provide loans to the ultimate recipient 
from its own funds (not loan or grant) to pay part of the ultimate 
recipients' project cost. The amount of the intermediary's own funds 
will average:
    (i) At least 10 percent but less than 25 percent of the total 
development costs--5 points;
    (ii) At least 25 percent but less than 50 percent of total 
development costs--10 points; or
    (iii) 50 percent or more of total development costs--15 points.
    (2) Intermediary contribution. The Intermediary will contribute its 
own funds not derived from Rural Development. The non-Rural Development 
contributed funds will be placed in a separate account from the PRLF 
loan account. The intermediary shall contribute funds not derived from 
Rural Development into a separate bank account or accounts according to 
their ``workout plan''. These funds are to be placed into an interest 
bearing counter-signature-account for three years. The counter-
signature-account will require a signature from a Rural Development 
employee and intermediary. After three years, these funds shall be 
commingled with the PRLF to provide loans to the ultimate recipient for 
the preservation and revitalization of Section 515 Multi-Family 
Housing.
    The amount of non-Agency derived funds contributed to the PRLF will 
equal the following percentage of Rural Development PRLF loan:
    (a) At least 5 percent but less than 15 percent--15 points;

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    (b) At least 15 percent but less than 25 percent--30 points; or
    (c) 25 percent or more--50 points.
    (3) Experience. The intermediary has actual experience in the 
administration of revolving loan funds and the preservation of Multi-
Family Housing, with a successful record, for the following number of 
full years. Applicants must have actual experience in both the 
administration of revolving loan funds and the preservation of Multi-
Family Housing in order to qualify for points under the selection 
criteria. If the number of years of experience differs between the two 
types of above listed experience, the type of experience with the 
lesser number of years will be used for the selection criteria.
    (a) At least one but less than three years--5 points;
    (b) At least three but less than five years--10 points;
    (c) At least five but less than 10 years--20 points; or
    (d) 10 or more years--30 points.
    (4) Administrative. The Administrator may assign up to 25 
additional points to an application to account for the following items 
not adequately covered by the other priority criteria set out in this 
section. The items that will be considered are the amount of funds 
requested in relation to the amount of need; a particularly successful 
affordable housing development record; a service area with no other 
PRLF coverage; a service area with severe affordable housing problems; 
a service area with emergency conditions caused by a natural disaster; 
an innovative proposal; the quality of the proposed program; economic 
development plan from the local community, particularly a plan prepared 
as part of a request for an Empowerment Zone/Enterprise Community 
designation; or excellent utilization of an existing revolving loan 
fund program. The Administrator will document the reasons for the 
particular point allocation.

VI. Appeal Process

    All adverse determinations regarding applicant eligibility and the 
awarding of points as part of the selection process are appealable. 
Instructions on the appeal process will be provided at the time an 
applicant is notified of the adverse action.
    To file a complaint of discrimination, write to USDA, Director, 
Office of Civil Rights, 1400 Independence Avenue, SW., Washington, DC 
20250-9410, or call (800) 795-3272 (voice) or (202) 720-6382 (TDD). 
USDA is an equal opportunity provider, employer, and lender. The U.S. 
Department of Agriculture 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 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).

    Dated: August 6, 2008.
Russell T. Davis,
Administrator, Rural Housing Service.
 [FR Doc. E8-19084 Filed 8-18-08; 8:45 am]
BILLING CODE 3410-XV-P