[Federal Register Volume 74, Number 177 (Tuesday, September 15, 2009)]
[Notices]
[Pages 47185-47186]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-21859]
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Notices
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains documents other than rules
or proposed rules that are applicable to the public. Notices of hearings
and investigations, committee meetings, agency decisions and rulings,
delegations of authority, filing of petitions and applications and agency
statements of organization and functions are examples of documents
appearing in this section.
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Federal Register / Vol. 74, No. 177 / Tuesday, September 15, 2009 /
Notices
[[Page 47185]]
DEPARTMENT OF AGRICULTURE
Rural Housing Service
Notice of Acceptance of Proposals for the Section 538 Multi-
Family Housing Guaranteed Rural Rental Housing Program (GRRHP)
Demonstration Program for Fiscal Year 2009
AGENCY: Rural Housing Service, USDA.
ACTION: Notice.
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SUMMARY: Through this Notice, the Agency announces the implementation
of a demonstration program under the section 538 Guaranteed Rural
Rental Housing Program (GRRHP) pursuant to 7 CFR 3565.4 for Fiscal Year
(FY) 2009 and 7 CFR 3565.17 demonstration programs. The Demonstration
Program's purpose is to test the viability and efficacy of the concept
of a continuous loan note guarantee through the construction and
permanent loan financing phases of a project. Those applications that
meet the Demonstration Program's qualifying criteria and are selected
to participate will be offered one loan note guarantee upon closing of
the construction loan that will be in effect throughout both of the
project's construction and permanent phases without interruption.
The Agency will permit approximately $10 million in previously
obligated program loan authority to participate in this Demonstration
Program. Expenses incurred in developing applications will be at the
applicant's risk. The following paragraphs outline the timeframes,
eligibility requirements, lender responsibilities, and the overall
response and application processes.
Eligible Lenders wishing to have their GRRHP obligated, but
unfunded guaranteed 538 applications considered for the FY 2009
Demonstration Program must send a signed request on its letterhead with
the proposed project details as outlined in the ``Demonstration Program
Response Submission Address'' section of this Notice. No other
applications will be considered.
Demonstration Program Guidelines
The following guidelines are being provided to facilitate a
structured implementation of the program:
1. Demonstration guarantee. The Demonstration guarantee is a
guarantee that will be offered to selected lenders who submit
applications in response to this Notice. The Demonstration guarantee
will consist of one loan note guarantee that will be issued upon
closing of the construction loan and will be in effect throughout both
of the project's construction and permanent financing phases without
interruption.
2. Upon approval of an eligible previously obligated guaranteed 538
application from an approved lender, the Agency will modify the
outstanding conditional commitment to provide a demonstration guarantee
for the construction and permanent financing phases of the project,
subject to the availability of funds.
3. Guarantee percentage and payment. Both construction loan
advances and permanent loans are eligible for a guarantee subject to
the following limitations:
Construction loan advances and permanent loans. The Agency can
guarantee the ``construction and permanent'' financing phases of a
project. The Agency cannot, however, guarantee only the
``construction'' financing phase of a project. Guarantees under the
demonstration guarantee will cover construction loan advances and the
subsequent permanent loan. The maximum guarantee of construction
advances will not at any time exceed the lesser of 90 percent of the
amount of principal and interest up to default advanced for eligible
uses of loan proceeds or 90 percent of the original principal amount
and interest up to default of a loan. Penalties incurred as a result of
default are not covered by the guarantee. The Agency may provide a
lesser guarantee based upon its evaluation of the credit quality of the
loan.
4. A lender making a construction loan must demonstrate an ability
to originate and service construction loans.
5 Guarantee during construction. The Agency will issue a
demonstration guarantee only to an approved lender.
6. Demonstration guarantee program compliance requirement. For a
demonstration guarantee, after the loan note guarantee is issued, the
following items will have to be submitted and approved by the Agency
within the timeframe stipulated by the Agency:
(i) A certificate of substantial completion;
(ii) A certificate of occupancy or similar evidence of local
approval;
(iii) A final cost certification in a form acceptable to the
Agency;
(iv) A complete copy of the permanent loan closing docket, if a
separate closing is conducted for the permanent loan; and
(v) Any other information necessary for the Agency to comply with
its regulations.
Items (i), (ii) and (iii) are only required if the project is
constructed. To facilitate the implementation of the program, certain
program forms may be addended to include relevant Demonstration Program
requirements.
The selected applicants will be subject to the Demonstration
Program guidelines in this Notice, and GRRHP's controlling statute,
regulations, and handbook as amended. The GRRHP operates under the
Housing Act of 1949, as amended, and regulations at 7 CFR part 3565.
The GRRHP Origination and Servicing Handbook (HB-1-3565) is available
to provide lenders and the general public with guidance on program
administration. HB-1-3565, which contains a copy of 7 CFR part 3565 in
Appendix 1, can be found at the Rural Development Instructions Web site
address http://www.rurdev.usda.gov/regs/hblist.html#hbw6.
Demonstration Program Eligibility: GRRHP obligated applications
that meet the following criteria will be eligible for consideration to
be selected into the Demonstration Program:
1. The project must have been awarded and continue to receive Low
Income Housing Tax Credits.
2. The project must have a loan to cost (LTC) ratio equal to or
lower than 50%.
3. The Lender must have submitted a timely response to this Notice
in accordance with the ``Demonstration Program Response Submission
Address'' section of this Notice.
4. A Lender must have submitted its application under the GRRHP
2008 Notice published February 4, 2008,
[[Page 47186]]
Volume 73 FR 6469-6477, the GRRHP 2009 Notice published January 21,
2009, Volume 74 FR, 3551-3558, or the GRRHP 2009 Notice published on
June 26, 2009, Volume 74 FR, 30503-30510.
5. The application to be considered must have been obligated from
October 1, 2008 to December 18, 2009. However, if Demonstration funds
have not been fully utilized by December 18, 2009, the Agency may
consider applications obligated on or after October 1, 2007.
6. The Lender must not have closed the construction loan prior to
its selection to participate in the Demonstration Program.
Demonstration Program Selection Process
Selections from qualified applications that have requested
consideration and met all requirements for this Demonstration Program
will be based on priority scores they received on their previously
submitted applications, with the highest scoring applications, being
selected first, until all available Demonstration Program Authority is
used. In the event of a tie, priority will be given to the application
that: is in the smaller rural community, and in case of a subsequent
tie to the application that has the lowest LTC ratio.
The first round of selections into the Demonstration Program will
be made on
September 18, 2009. In the event there are not enough qualified
requests for selection into the Demonstration Program to utilize all
the available Demonstration Program Authority, then until all funds are
exhausted, an additional selection process will be conducted on the 3rd
Friday of each the month starting October 16, 2009, with December 18,
2009 being the last selection date. All applicants will be notified of
the selection results no later than 30 business days from the date of
selection.
Demonstration Program Response Submission Address
Eligible lenders wishing to have their obligated applications
considered for selection into the Demonstration Program must submit a
signed request (not to exceed one page) on its letterhead that includes
the following information:
1. Developer's Name
2. Borrower's Name
3. Project's Name
4. Project's Address (City and State)
5. Project Type (Family, Senior, or Mixed)
6. Project's Total Units
7. Project's Total Development Cost (TDC)
8. Amount of 538 Loan Guarantee
9. Amount of Tax Credits Awarded
10. Amount and Source of Other Financing
11. Loan to Cost (LTC) %
12. Area Population
13. Date obligated or date of Conditional Commitment
Send the Demonstration Program Response Submission Letter with all
of the information listed above, along with a copy of the State
Office's ``Proceed with Application/NOFA Response Selection'' letter
and a copy of the tax credit award notification to: Tammy S. Daniels,
Financial and Loan Analyst, Multi-Family Housing Guaranteed Loan
Division, Guaranteed Rural Rental Housing Program, USDA Rural
Development, South Agriculture Building, Room 1233, STOP 0781, 1400
Independence Avenue, SW., Washington, DC 20250-0781.
Requests may also be faxed to 202-690-3444 or sent by e-mail
(signed PDF copies of the above submissions) to
[email protected]. Eligible lenders mailing a request must
provide sufficient time to permit delivery to the Submission Address.
If all the funds set aside for the Demonstration Program have not been
utilized, the Agency will continue to accept requests for inclusion
into the FY 2009 Demonstration Program until December 17, 2009.
Acceptance by a U.S. Post Office or private mailer does not constitute
delivery. Postage due responses and applications will not be accepted.
Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995, the
information collection requirements contained in this Notice is
approved by the Office of Management and Budget (OMB) under OMB Control
Number 0575-0174.
Nondiscrimination Statement
``The U.S. Department of Agriculture (USDA) prohibits
discrimination in all its programs and activities on the basis of race,
color, national origin, sex, religion, age, disability, political
beliefs, sexual orientation, marital status or family status (not all
prohibited basis apply to all programs). Persons with disabilities who
require alternative means for communication of program information
(Braille, large print, audiotape, etc.) should contact the USDA's
Target Center at (202) 720-2600 (voice or TDD). To file a complaint of
discrimination, write USDA, Director, Office of Civil Rights, Room 326-
W, Whitten Building, 1400 Independence Avenue, SW., Washington, DC
20250-9410, or call toll free, (866) 632-9992 (Voice). TDD users can
contact USDA through local relay (800) 720-6382 (TDD) or (866) 377-8642
(relay voice users). USDA is an equal opportunity provider and
employer.''
Dated: September 3, 2009.
Sylvia Bolivar,
Acting Administrator, Rural Housing Service.
[FR Doc. E9-21859 Filed 9-14-09; 8:45 am]
BILLING CODE 3410-XV-P