[Federal Register Volume 81, Number 125 (Wednesday, June 29, 2016)]
[Notices]
[Pages 42309-42312]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-15393]


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DEPARTMENT OF AGRICULTURE

Rural Housing Service


Rural Development Voucher Program

AGENCY: Rural Housing Service, USDA.

ACTION: Notice.

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SUMMARY: The U.S. Department of Agriculture (USDA) in fiscal year (FY) 
2006 established the demonstration Rural Development Voucher Program 
(RDVP), as authorized under Section 542 of the Housing Act of 1949 as 
amended (42 U.S.C. 1490R) (without regard to Section 542(b)). This 
Notice informs the public of the general policies and procedures for 
the RDVP for FY 2016. Rural Development Vouchers are only available to 
low-income tenants of Rural Development (RD)-financed multi-family 
properties where the Rural Rental Housing loan (Section 515) has been 
prepaid (either through prepayment or foreclosure action); prior to the 
loan's maturity date.

DATES: In order for eligible tenants to participate, a voucher 
obligation form must be submitted within 10 months of the foreclosure 
or pre-payment.

FOR FURTHER INFORMATION CONTACT: Stephanie B.M. White, Director, Multi-

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Family Housing Portfolio Management Division, Rural Development, U.S. 
Department of Agriculture, 1400 Independence Avenue SW., STOP 0782, 
Washington, DC 20250, telephone (202) 720-1615. Persons with hearing or 
speech impairments may access this number via TDD by calling the toll-
free Federal Information Relay Service at (800) 877-8339.

SUPPLEMENTARY INFORMATION: 

I. Background

    This Notice outlines the process for providing voucher assistance 
to eligible tenants when a property owner either prepays a Section 515 
loan or USDA action results in a foreclosure after September 30, 2005.
    The Consolidated Appropriations Act, 2016, Public Law 114-113, 
provided that the Secretary of the USDA shall carry out the Rural 
Development Voucher program as follows:
    That of the funds made available under this heading, $15,000,000, 
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.
    This Notice outlines the process for providing voucher assistance 
to the eligible impacted families when an owner prepays a Section 515 
loan or USDA action results in a foreclosure.

II. Design Features of the RDVP

    This section sets forth the design features of the RDVP, including 
the eligibility of tenants, the inspection of the housing 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 RD mission area, in 
accordance with requirements set forth in this Notice and further 
explained in, ``The Rural Development Voucher Program Guide,'' which 
can be obtained by contacting any RD Office. Contact information for RD 
offices can be found at: http://www.rd.usda.gov/contact-us/state-offices. These requirements are generally based on the housing choice 
voucher program regulations of the Department of Housing and Urban 
Development (HUD) set forth at 24 CFR part 982, unless otherwise noted 
by this Notice.
    The RDVP is intended to offer protection to eligible Multi-Family 
Housing tenants in properties financed through RD's Section 515 Rural 
Rental Housing program (Section 515 property) who may be subject to 
economic hardship due to the property owner's prepayment of the RD 
mortgage. When the owner of a Section 515 property pays off the loan 
prior to the loan's maturity date (either through prepayment or 
foreclosure action), the RD affordable housing requirements and Rental 
Assistance (RA) subsidies generally cease to exist. Rents may increase, 
thereby making the housing unaffordable to tenants. Regardless, the 
tenant may become responsible for the full payment of rent when a 
prepayment occurs, whether or not the rent increases.
    The Rural Development Voucher is intended to help tenants by 
providing an annual rental subsidy, renewable on the terms and 
conditions set forth herein and subject to the availability of funds, 
that will supplement the tenant's rent payment. This program 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 to 
take to any other rental unit in the United States and its territories. 
Tenants in properties foreclosed on by RD are eligible for a Rural 
Development Voucher under the same conditions as properties that go 
through the standard prepayment process.
    There are some general limitations on the use of a voucher:
     The rental unit must pass a RD health and safety 
inspection, and the owner must be willing to accept a Rural Development 
Voucher.
     Rural Development Vouchers cannot be used for units in 
subsidized housing, like Section 8 and public housing, where two 
housing subsidies would result. The Rural Development Voucher may be 
used for rental units in other properties financed by RD, but it cannot 
be used in combination with the RD RA program.
     The Rural Development Voucher may not be used to purchase 
a home.
    a. Tenant Eligibility. In order to be eligible for the Rural 
Development Voucher under this Notice, the tenant must meet the 
following conditions:
    1. Be residing in the Section 515 project on the date of the 
prepayment of the Section 515 loan or foreclosure by RD;
    2. Be a United States (U.S.) citizen, U.S. citizen national, or a 
resident alien that meets certain qualifications. In accordance with 
Section 214 of the Housing and Community Development Act of 1980 (42 
U.S.C. 1436a), financial assistance under this voucher program can only 
be provided to a United States (U.S.) citizen, U.S. non-citizen 
national, or a resident alien that meets certain qualifications. RD 
considers the tenant who applies for the voucher under this Notice as 
the individual receiving the financial assistance from the voucher. 
Accordingly, the individual tenant who applies for a voucher under this 
program must submit the following documentation (42 U.S.C. 1436a (d)):
    i. For citizens, a written declaration of U.S. citizenship signed 
under the penalty of perjury. RD may request verification of the 
declaration by requiring presentation of a U.S. passport, Social 
Security card, or other appropriate documentation, as determined by RD;
    ii. For non-citizens who are 62 years of age or older, the evidence 
consists of:
    A. A signed declaration of eligible immigration status; and
    B. Proof of age document; and
    iii. For all other non-citizens:
    A. A signed declaration of eligible immigration status;
    B. Alien registration documentation or other proof of immigration 
registration from the United States Citizenship and Immigration 
Services (USCIS) that contains the individual's alien admission number 
or alien file number; and
    C. A signed verification consent form that provides that evidence 
of eligible immigration status may be released to RD and USCIS for 
purposes of verifying the immigration status of the individual. RD 
shall provide a reasonable opportunity, not to exceed 30 days, for an 
individual to submit evidence indicating a satisfactory immigration 
status, or to appeal to the Immigration and Naturalization Service the 
verification determination of the Immigration and Naturalization 
Service; and
    3. Be a low-income tenant on the date of the prepayment or 
foreclosure. A low-income tenant is a tenant whose annual income does 
not exceed 80 percent of the tenant median income for the area as 
defined by HUD. HUD's definition of

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median income can be found at: https://www.huduser.gov/portal/datasets/il/il16/index_mfi.html.
    During the prepayment or foreclosure process, RD will evaluate the 
tenant to determine if the tenant is low-income. If RD determines a 
tenant is low-income, then within 90 days following the foreclosure or 
prepayment, RD will send the tenant a letter offering the tenant a 
voucher and will enclose a Voucher Obligation Request Form and a 
citizenship declaration form. If the tenant wants to participate in the 
RDVP, the tenant has 10 months from the date of prepayment or 
foreclosure to return the Voucher Obligation Request Form and the 
citizenship declaration to the local RD Office. If RD determines that 
the tenant is ineligible, RD will provide administrative appeal rights 
in accordance with 7 CFR part 11.
    b. Obtaining a Voucher. RD will monitor the prepayment request 
process or foreclosure process, as applicable. As part of prepayment or 
foreclosure of the Section 515 property, RD will determine market rents 
in the housing market area prior to the date of prepayment or 
foreclosure. The market rents will be used to calculate the amount of 
the voucher each tenant is entitled to receive.
    As noted above, all tenants will be notified if they are eligible 
and the amount of the voucher within 90 days following the date of 
prepayment or foreclosure. The tenant notice will include a description 
of the RDVP, a Voucher Obligation Request Form, and letter from RD 
offering the tenant participation in RDVP. The tenant has 10 months 
from the date of prepayment or foreclosure to return the Voucher 
Obligation Request Form and the signed citizenship declaration. Failure 
to submit the Voucher Obligation Request Form and the signed 
citizenship declaration within the required timeframes eliminates the 
tenant's opportunity to receive a voucher. A tenant's failure to 
respond within the required timeframes is not appealable.
    Once the tenant returns the Voucher Obligation Request Form and the 
citizenship declaration to RD, a voucher will be issued within 30 days 
subject to the availability of funding. All information necessary for a 
housing search, explanations of unit acceptability, and RD contact 
information will be provided by RD to the tenant after the Voucher 
Obligation Request Form and citizenship declaration are received. In 
cases where the foreclosure sale yields no successful bidders and the 
property enters RD inventory, vouchers will only be offered upon the 
property's entry into inventory. The voucher cannot be used at an 
inventory property.
    The tenant receiving a Rural Development Voucher has an initial 
period of 60 calendar days from issuance of the voucher to find a 
housing unit. At its discretion, RD may grant one or more extensions of 
the initial period for up to an additional 60 days. Generally, the 
maximum voucher period for any tenant participating in the RDVP is 120 
days. RD will extend the voucher search period beyond the 120 days only 
if the tenant needs and requests an extension of the initial period as 
a reasonable accommodation to make the program accessible to a disabled 
family member. If the Rural Development Voucher remains unused after a 
period of 150 days from the date of original issuance, the Rural 
Development Voucher will become void, any funding will be cancelled, 
and the tenant will no longer be eligible to receive a Rural 
Development Voucher at that property.
    If a tenant previously participated in the RDVP and was 
subsequently terminated, that tenant is ineligible for future 
participation in the RDVP.
    c. Initial Lease Term. The initial lease term for the housing unit 
where the tenant wishes to use the Rural Development Voucher must be 
for one year. The ``initial lease'' is the first lease signed by and 
between the tenant and the property owner.
    d. Inspection of Units and Unit Approval. Once the tenant finds a 
housing unit, Rural Development will inspect and determine if the 
housing standard is acceptable within 30 days of RD's receipt of the 
HUD Form 52517, ``Request for Tenancy Approval Housing Choice Voucher 
Program'' found at http://portal.hud.gov/hudportal/documents/huddoc?id=52517.pdf and the Disclosure of Information on Lead-Based 
Paint Hazards. The inspection standards currently in effect for the RD 
Section 515 Multi-Family Housing program apply to the RDVP. RD must 
inspect the unit and ensure that the unit meets the housing inspection 
standards set forth at 7 CFR 3560.103. Under no circumstances will RD 
make voucher rental payments for any period of time prior to the date 
that RD physically inspects the unit and determines the unit meets the 
housing inspection standards. In the case of properties financed by RD 
under the Section 515 program, RD will only accept the results of 
physical inspections performed no more than one year prior to the date 
of receipt by RD of Form HUD 52517, in order to make determinations on 
acceptable housing standards. Before approving tenancy or executing a 
Housing Assistance Payments contract, RD must first determine that the 
following conditions are met:
    1. The unit has been inspected by RD and passes the housing 
standards inspection or has otherwise been found acceptable by RD, as 
noted previously; and
    2. The lease includes the HUD Tenancy Addendum. A copy of the HUD 
Tenancy Addendum will be provided by RD when the tenant is informed he/
she is eligible for a voucher.
    Once the conditions in the above paragraph are met, RD will approve 
the unit for leasing. RD will then execute with the owner a Housing 
Assistance Payments (HAP) contract, Form HUD-52641. The HAP contract 
must be executed before Rural Development Voucher payments can be made. 
RD will attempt to execute the HAP contract on behalf of the tenant 
before the beginning of the lease term. In the event that this does not 
occur, 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, RD will make retroactive housing assistance 
payments to the owner, on behalf of the tenant, to cover the portion of 
the approved lease term before execution of the HAP contract. The HAP 
contract and lease will need to be revised to the later effective date. 
RD will not execute a HAP contract that is dated prior to either the 
prepayment date of the Section 515 loan, or the date of foreclosure, as 
appropriate. Any HAP contract executed after the 60-day period will be 
considered untimely. If the failure to execute the HAP contract within 
the aforementioned 60-day period lies with the owner, as determined by 
RD, then RD will not pay any housing assistance payment to the owner 
for that period.
    e. Subsidy Calculations for Rural Development Vouchers. As stated 
earlier, an eligible tenant will be notified of the maximum voucher 
amount within 90 days following prepayment or foreclosure. The maximum 
voucher amount for the RDVP is the difference between the market rent 
in the housing market area and the tenant's contribution on the date of 
the prepayment, as determined by RD. The voucher amount will be based 
on the market rent; the voucher amount will never exceed the market 
rent at the time of prepayment even if the tenant chooses to stay in-
place.
    Also, in no event will the Rural Development Voucher payment exceed 
the actual tenant lease rent. The amount of the voucher will not change 
either

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over time or if the tenant chooses to move to a more expensive 
location.
    f. Mobility and Portability of Rural Development Vouchers. An 
eligible tenant that is issued a Rural Development Voucher may elect to 
use the voucher in the same project, or may choose to move to another 
location. The Rural Development Voucher may be used at the prepaid 
property or any other rental unit in the United States and its 
territories that passes RD physical inspection standards, and where the 
owner will accept a Rural Development Voucher and execute a Form HUD 
52641. Both the tenant and landlord must inform RD if the tenant plans 
to move during the HAP agreement term, even to a new unit in the same 
complex. All moves (within a complex or to another complex) require a 
new voucher obligation form, a new inspection by RD, and a new HAP 
agreement. In addition, HUD Section 8 and federally-assisted public 
housing are excluded from the RDVP because those units are already 
federally subsidized; tenants with a Rural Development Voucher would 
have to give up the Rural Development Voucher to accept those other 
types of assistance at those properties. However, while the Rural 
Development Voucher may be used in other properties financed by RD, it 
cannot be used in combination with the RD RA program. Tenants with a 
Rural Development Voucher that apply for housing in an RD-financed 
property must choose between using the voucher or RA, if available. If 
the tenant relinquishes the Rural Development Voucher in favor of RA, 
the tenant is not eligible to receive another Rural Development Voucher 
while the tenant is receiving such RA.
    g. Term of Funding and Conditions for Renewal for Rural Development 
Vouchers. The RDVP provides voucher assistance over 12 monthly 
payments. The voucher is issued to the household in the name of the 
primary tenant as the voucher holder. The voucher is not transferable 
from the voucher holder to any other household member, except in the 
case of the voucher holder's death or involuntary household separation, 
such as the incarceration of the voucher holder or transfer of the 
voucher holder to an assisted living or nursing home facility. Upon 
receiving documentation of such cases, the voucher may be transferred 
at the Agency's discretion to another tenant on the voucher holder's 
lease.
    The voucher is renewable subject to the availability of 
appropriations to the USDA. In order to renew a voucher, a tenant must 
return a signed Voucher Obligation Request Form, which will be sent to 
the tenant within 60-90 days before the current voucher expires. If the 
voucher holder fails to return the renewal Voucher Obligation Request 
Form before the current voucher funding expires, the voucher will be 
terminated and no renewal will occur.
    In order to ensure continued eligibility to use the Rural 
Development Voucher, tenants must certify at the time they apply for 
renewal of the voucher that the current tenant income does not exceed 
the ``maximum income level,'' which is 80 percent of family median 
income (a HUD dataset broken down by State, and then by county). RD 
will advise the tenant of the maximum income level when the renewal 
Voucher Obligation Request Form is sent.
    Renewal requests will enjoy no preference over other voucher 
requests, and will be processed as described in this Notice.

III. Non-Discrimination Statement

    In accordance with Federal civil rights law and U.S. Department of 
Agriculture (USDA) civil rights regulations and policies, the USDA its 
Agencies, offices, and employees, and institutions participating in or 
administering USDA programs are prohibited from discrimination based on 
race, color, national origin, religion, sex, gender identity (including 
gender expression, sexual orientation, disability, age, marital status, 
family/parental status, income derived from a public assistance 
program, political beliefs, or reprisal or retaliation for prior civil 
rights activity, in any program or activity conducted or funded by USDA 
(not all bases apply to all programs). Remedies and complaint filing 
deadlines vary by program or incident.
    Persons with disabilities who require alternative means of 
communication for program information (e.g., Braille, large print, 
audiotape, American Sign Language, etc.) should contact the responsible 
Agency or USDA's TARGET Center at (202) 720-2600 (voice and TTY) or 
contact USDA through the Federal Relay Service at (800) 877-8339. 
Additionally, program information may be made available in languages 
other than English.
    To file a program discrimination complaint, complete the USDA 
Program Discrimination Complaint Form, AD-3027, found online at http://www.ascr.usda.gov/complaint_filing_cust.html, and at any USDA office or 
write a letter addressed to USDA and provide in the letter all of the 
information requested in the form. To request a copy of the complaint 
form, call (866) 632-9992 to request the form. Submit your completed 
form or letter to USDA by:
    (1) Mail: U.S. Department of Agriculture, Office of the Assistant 
Secretary for Civil Rights, 1400 Independence Avenue SW., Washington, 
DC 20250-9410;
    (2) fax (202) 690-7442; or
    (3) email: [email protected]
    USDA is an equal opportunity provider, employer, and lender.

IV. 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.

     Dated: June 22, 2016.
Tony Hernandez,
Administrator, Rural Housing Service.
[FR Doc. 2016-15393 Filed 6-28-16; 8:45 am]
 BILLING CODE 3410-XV-P