[Federal Register Volume 79, Number 181 (Thursday, September 18, 2014)]
[Rules and Regulations]
[Pages 55965-55968]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-21704]


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DEPARTMENT OF AGRICULTURE

Rural Housing Service

Rural Business-Cooperative Services

Rural Utilities Service

Farm Service Agency

7 CFR Parts 1940, 1942, 1944, 1948, and 1980

RIN 0575-ZA01


Eliminate the 6-Day Reservation Period Requirement for Rural 
Development Obligations

AGENCY: Rural Housing Service, Rural Business-Cooperative Service, 
Rural Utilities Service, and Farm Service Agency, USDA.

ACTION: Direct final rule.

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SUMMARY: Rural Development (RD) is amending the regulations so that an 
obligation date for all guaranteed loans, direct loans, and grants will 
no longer be 6 working days from the date of request for reservation of 
authority. This action is necessary as the 6-day reservation period 
will be permanently removed from the Commercial Loan Servicing System 
(CLSS), Guaranteed Loan System (GLS), and Program Loan Accounting 
System (PLAS). The effect of this action will reduce system or manual 
intervention when legislative mandates direct cutoff for obligations 
and/or funding; eliminate program waivers on obligation date; increase 
consistency with other RD programs; reduce risks with new system 
implementations, such as the Financial Modernization Management 
Initiative; and eliminate numerous reconciliation issues between 
processed obligations and actual obligations for internal RD reports 
and USDA reporting requirements.

DATES: This rule will become effective January 16, 2015 without further 
action, unless the Agency receives written adverse comments on or 
before November 17, 2014. If the Agency receives adverse comments, the 
Agency will publish a timely document in the Federal Register 
withdrawing the amendment.
    Any adverse comments received will be considered under the proposed 
rule published in this edition of the Federal Register in the proposed 
rule section. A second public comment period will not be held. Written 
comments must be received by the Agency or carry a postmark no later 
than November 17, 2014.

ADDRESSES: You may submit comments to this rule by any of the following 
methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Mail: Submit written comments via the U.S. Postal Service 
to the Branch Chief, Regulations and Paperwork Management Branch, U.S. 
Department of Agriculture, STOP 0742, 1400 Independence Avenue SW., 
Washington, DC 20250-0742.
     Hand Delivery/Courier: Submit written comments via Federal 
Express Mail or other courier service requiring a street address to the 
Branch Chief, Regulations and Paperwork Management Branch, U.S. 
Department of Agriculture, 300 7th Street SW., 7th Floor, Washington, 
DC 20024.
    All written comments will be available for public inspection during 
regular work hours at 300 7th Street SW., 7th Floor address listed 
above.

FOR FURTHER INFORMATION CONTACT: Ms. Amanda Lammering, Rural 
Development, U.S. Department of Agriculture, 4300 Goodfellow Blvd., FC-
33, St. Louis, MO 63120; email: [email protected]; 
telephone (314) 457-4058; or Ms. Kristen Landwehr, Rural Development, 
U.S. Department of Agriculture, 4300 Goodfellow Blvd., FC-33, St. 
Louis, MO 63120; email: [email protected]; telephone (314) 
457-4180.

SUPPLEMENTARY INFORMATION:

Background

    Various RD automated accounting systems are designed to process 
obligations for Business, Community Facility, and Water and 
Environmental direct loan, guaranteed loan, and grant programs using a 
6-day reservation period. The 6-day reservation period is a system edit 
in the PLAS, GLS, and CLSS that assigns an obligation date to an RD 
funded project 6 working days from the date funds are reserved.
    When RD programs are funded through a continuing resolution, the 
accounting systems must be modified to waive the 6-day reservation 
edit. In Fiscal Year 2011, RD received six continuing resolutions 
followed by four continuing resolutions in Fiscal Year 2012 which 
resulted in cumbersome systems' modifications. These modifications have 
caused undue hardship to RD staff due to last minute continuing 
resolution decisions, manual system adjustments needed, and time 
consuming coordination efforts.
    Several new RD programs have not implemented a 6-day reservation 
period for obligations. Under the American Recovery and Reinvestment 
Act of 2009 (ARRA) the Business and Industry (B&I) Guaranteed Loan 
Program disabled the 6 day reservation period along with the 
Biorefinery Assistance Program of the 2008 Farm Bill. Additionally, 
Rural Electric and Telecommunication, Single Family Housing, and Multi-
Family Housing loans do not have a 6-day reservation requirement when 
obligating program funds.
    To maintain consistency and uniformity across RD's automated 
accounting systems, RD will be removing the 6-day reservation system 
edit on obligations. As automation for this enhancement is completed, 
program staffs will have immediate knowledge of approved obligations as 
opposed to showing the obligations on reserved status. Field office 
personnel will adhere to a 6-working day waiting period prior to 
notifying an applicant/lender of loan and/or grant approval. Rural 
Development believes the removal of the 6-day reservation period on 
obligations for guaranteed loans, direct loans, and grants to be a 
noncontroversial change to the regulations with no impact on the 
public.

Programs Affected

    The programs described by this rule are listed in the Catalog of 
Federal Domestic Assistance Programs under number(s) 10.350 Technical 
Assistance to Cooperatives, 10.352 Value-Added Producer Grants, 10.420 
Rural Self-Help Housing Technical Assistance, 10.433 Rural Housing 
Preservation Grants, 10.446 Rural Community Development Initiative, 
10.759 Part 1774 Special Evaluation Assistance for Rural

[[Page 55966]]

Communities and Household Program (SEARCH), 10.760 Water and Waste 
Disposal Systems for Rural Communities, 10.761 Technical Assistance and 
Training Grants, 10.762 Solid Waste Management Grants, 10.763 Emergency 
Community Water Assistance Grants, 10.766 Community Facilities Loans 
and Grants, 10.767 Intermediary Relending Program, 10.768 Business and 
Industry Loans, 10.769 Rural Business Enterprise Grants, 10.770 Water 
and Waste Disposal Loans and Grants (section 306C), 10.771 Rural 
Cooperative Development Grants, 10.773 Rural Business Opportunity 
Grants, 10.778 Research on the Economic Impact of Cooperatives, 10.781 
Water and Waste Disposal Systems for Rural Communities--ARRA, 10.854 
Rural Economic Development Loans and Grants, 10.856 1890 Land Grant 
Institutions Rural Entrepreneurial Outreach Program, 10.858 Denali 
Commission Grants and Loans, 10.862 Household Water Well System Grant 
Program, 10.864 Grant Program to Establish a Fund for Financing Water 
and Wastewater Projects, 10.866 Repowering Assistance, 10.868 Rural 
Energy for America Program, 10.870 Rural Micro entrepreneur Assistance 
Program.

Executive Order 12866--Classification

    This rule has been determined to be not significant for purposes of 
Executive Order 12866 and therefore has not been reviewed by the Office 
of Management and Budget (OMB).

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 of 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).
    If you wish to file a Civil Rights program complaint of 
discrimination, complete the USDA Program Discrimination Complaint 
Form, found online at http://www.ascr.usda.gov/complaint_filing_cust.html, or at any USDA office, or 
call (866) 632-9992 to request the form. You may also write a letter 
containing all of the information requested in the form. Send your 
completed complaint form or letter to us by mail at U.S. Department of 
Agriculture, Director, Office of Adjudication, 1400 Independence Avenue 
SW., Washington, DC 20250-9410, by fax (202) 690-7442 or email at 
[email protected]. Individuals who are deaf, hard of hearing or 
have speech disabilities and you wish to file a program complaint 
please contact USDA through the Federal Relay Service at (800) 877-8339 
or (800) 845-6136 (in Spanish). USDA is an equal opportunity provider 
and employer.

Civil Rights Impact Statement

    No major civil rights impact is likely to result from the 
announcement of this notice. It will not have a negative civil rights 
impact on very-low income, low income, and moderate income and minority 
populations.

Environmental Impact Statement

    This document has been reviewed in accordance with 7 CFR part 1940, 
subpart G, ``Environmental Program.'' Rural Development has determined 
that this action does not constitute a major Federal action 
significantly affecting the quality of the human environment and, in 
accordance with the National Environmental Policy Act (NEPA) of 1969, 
42 U.S.C. 4321 et seq., an Environmental Impact Statement is not 
required.

Executive Order 12372, Intergovernmental Consultation

    This program is not subject to the requirements of Executive Order 
12372, ``Intergovernmental Review of Federal Programs,'' as implemented 
under USDA's regulations at 7 CFR part 3015.

Executive Order 12988, Civil Justice

    This direct final rule has been reviewed under Executive Order 
12988, Civil Justice Reform. In accordance with this rule: (1) All 
State and local laws and regulations that are in conflict with this 
rule will be preempted; (2) no retroactive effect will be given this 
rule; and (3) administrative proceedings in accordance with the 
regulations of the Department of Agriculture's National Appeals 
Division (7 CFR part 11) must be exhausted before bringing suit in 
court challenging action taken under this rule unless those regulations 
specifically allow bringing suit at an earlier time.

Executive Order 13132, Federalism

    The policies contained in this direct final rule do not have any 
substantial direct effect on States, on the relationship between the 
national government and the states, or on the distribution of power and 
responsibilities among the various levels of government. Nor does this 
rule impose substantial direct compliance costs on State and local 
governments. Therefore, consultation with states is not required.

Regulatory Flexibility Act Certification

    The Regulatory Flexibility Act (5 U.S.C. 601-602) (RFA) generally 
requires an agency to prepare a regulatory flexibility analysis of any 
rule subject to notice and comment rulemaking requirements under the 
Administrative Procedure Act (``APA'') or any other statute. This rule, 
however, is not subject to the APA under 5 U.S.C 553(a)(2) and 5 U.S.C. 
553(b)(3)(A) nor any other statute.

Unfunded Mandates

    Title II of the Unfunded Mandate Reform Act of 1995 (UMRA, Pub. L. 
104-4) requires Federal agencies to assess the effects of their 
regulatory actions on State, local, or Tribal governments or the 
private sector. Agencies generally must prepare a written statement, 
including a cost benefit analysis, for proposed and final rules with 
Federal mandates that may result in expenditures of $100 million or 
more in any 1 year for State, local, or Tribal governments, in the 
aggregate, or to the private sector. UMRA generally requires agencies 
to consider alternatives and adopt the more cost effective or least 
burdensome alternative that achieves the objectives of the rule.
    This direct final rule contains no Federal mandates (under the 
regulatory provisions of Title II of the Unfunded Mandates Reform Act 
of 1995) for State, local, and tribal Governments or the private 
sector. Therefore, this rule is not subject to the requirements of 
sections 202 and 205 of the Unfunded Mandates Reform Act of 1995.

Executive Order 13175, Consultation and Coordination With Indian Tribal 
Governments

    This executive order imposes requirements on Rural Development in 
the development of regulatory policies that have tribal implications or 
preempt tribal laws. Rural Development has determined that the final 
rule does not have a substantial direct effect on one or more Indian 
tribe(s) or on either the relationship or the distribution of powers 
and responsibilities between the Federal Government and Indian tribes. 
Thus, this final rule is not subject to the requirements of Executive 
Order 13175. If a tribe determines that this rule has implications of 
which Rural

[[Page 55967]]

Development is not aware and would like to engage with Rural 
Development on this rule, please contact Rural Development's Native 
American Coordinator at [email protected].

Paperwork Reduction Act

    This rule does not contain any information collection requirements 
under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

E-Government Act Compliance

    Rural Development is committed to complying with the E-Government 
Act, to promote the use of the Internet and other information 
technologies to provide increased opportunities for citizen access to 
Government information and services, and for other purposes.

List of Subjects

7 CFR Part 1940

    Agriculture, Grant programs-agriculture, Grant programs-housing and 
community development, Loan programs-agriculture, Loan programs-housing 
and community development, Rural areas.

7 CFR Part 1942

    Business and industry, Community facilities, Grant programs-
business, Grant programs-housing and community development, Grant 
programs-Indians, Indians, Loan programs-agriculture, Loan programs-
housing and community development, Loan programs-Indians, Loan 
programs-natural resources, Rural areas, Waste treatment and disposal, 
Water supply, Watersheds.

7 CFR Part 1944

    Administrative practice and procedure, Cooperatives, Grant programs 
housing and community development, Loan programs-housing and community 
development, Rural areas.

7 CFR Part 1948

    Community facilities, Grant programs-housing and community 
development, Rural areas.

7 CFR Part 1980

    Agriculture, Business and industry, Community facilities, Disaster 
assistance, Loan programs-agriculture, Loan programs-business, Loan 
programs-housing and community development, Rural areas.

    For the reasons set forth in the preamble, chapter XVIII, title 7, 
of the Code of Federal Regulations is amended as follows:

CHAPTER XVIII--RURAL HOUSING SERVICE, RURAL BUSINESS-COOPERATIVE 
SERVICE, RURAL UTILITIES SERVICE, AND FARM SERVICE AGENCY, 
DEPARTMENT OF AGRICULTURE

PART 1940--GENERAL

0
1. The authority citation for part 1940 continues to read as follows:

    Authority:  5 U.S.C. 301; 7 U.S.C. 1989; and 42 U.S.C. 1480.

Subpart L--Methodology and Formulas for Allocation of Loan and 
Grant Program Funds

0
2. Amend Sec.  1940.588 by revising paragraph (i) to read as follows:


Sec.  1940.588  Business and Industry Guaranteed and Direct Loans

* * * * *
    (i) Availability of the allocation. See Sec.  1940.552(i) of this 
subpart.
* * * * *

PART 1942--ASSOCIATIONS

0
3. The authority citation for part 1942 continues to read as follows:

    Authority: 5 U.S.C. 301; 7 U.S.C. 1989.

Subpart A--Community Facility Loans

0
4. Amend Sec.  1942.5 by revising paragraph (d)(4) and the first 
sentence of paragraph (d)(6) to read as follows:


Sec.  1942.5  Application review and approval.

* * * * *
    (d) * * *
    (4) The date the applicant is notified of loan and/or grant 
approval is six working days from the date funds are reserved unless an 
exception is granted by the National Office.
* * * * *
    (6) Loan approval and applicant notification will be accomplished 
by the State Director or designee by mailing to the applicant, 6 
working days from the obligation date, a copy of Form FmHA or its 
successor agency under Public Law 103-354 1940-1 which has been 
previously signed by the applicant and loan approval official. * * *
* * * * *

PART 1944--HOUSING

0
5. The authority citation for part 1944 continues to read as follows:

    Authority: 5 U.S.C. 301; 42 U.S.C. 1480.

Subpart K--Technical and Supervisory Assistance Grants

0
6. Amend Sec.  1944.533 by revising the last sentence of paragraph 
(f)(2)(i) and the introductory text of paragraph (f)(4) to read as 
follows:


Sec.  1944.533  Grant approval and announcement.

* * * * *
    (f) * * *
    (2) * * *
    (i) * * * The obligation date will be the date the request for 
obligation is processed.
* * * * *
    (4) An executed form FmHA or its successor agency under Public Law 
103-354 1940-1 will be sent to the applicant along with an executed 
copy of the Grant Agreement and scope of work 6 working days from the 
date funds are obligated.
* * * * *

PART 1948--RURAL DEVELOPMENT

0
7. The authority citation for part 1948 continues to read as follows:

    Authority:  5 U.S.C. 301, 7 U.S.C. 1932 note.

Subpart B--Section 601 Energy Impacted Area Development Assistance 
Program

0
8. Amend Sec.  1948.92 by revising the last sentence of paragraph 
(g)(3) and paragraph (g)(8) to read as follows:


Sec.  1948.92  Grant approval and fund obligation.

* * * * *
    (g) * * *
    (3) * * * The obligation date will be the date the request for 
obligation is processed.
* * * * *
    (8) An executed copy of Form FmHA or its successor agency under 
Public Law 103-354 440-1 shall be sent to the applicant along with an 
executed copy of the grant agreement and scope of work 6 working days 
from the date funds are obligated.
* * * * *

PART 1980--GENERAL

0
9. The authority citation for part 1980 continues to read as follows:

    Authority: 5 U.S.C. 301 and 7 U.S.C. 1989. Subpart E also issued 
under 7 U.S.C. 1932(a).

Subpart E--Business and Industrial Loan Program

0
10. In Sec.  1980.452 under the heading ``Administrative'', revise the 
fifth

[[Page 55968]]

sentence of paragraph D.6. introductory text and the third sentences of 
paragraph D.6.d. to read as follows:


Sec.  1980.452  FmHA or its successor agency under Public Law 103-354 
evaluation of application.

* * * * *
    D. * * *
    6. * * * Notice of approval to lender will be accomplished by 
providing or sending the lender the signed copy of Form FmHA or its 
successor agency under Public Law 103-354 1940-3 and Form FmHA or its 
successor agency under Public Law 103-354 449-14 six working days from 
the date funds are reserved, unless an exception is granted by the 
National Office. * * *
* * * * *
    (d) * * * The obligation date will be the date of the request for 
reservation of authority which is being processed in the Finance 
Office. * * *
* * * * *

     Dated: August 7, 2014.
Doug O'Brien,
Under Secretary, Rural Development.
    Dated: September 3, 2014.
Michael Scuse,
Under Secretary, Farm and Foreign Agricultural Services.
[FR Doc. 2014-21704 Filed 9-17-14; 8:45 am]
BILLING CODE 3410-XT-P