[Federal Register Volume 82, Number 12 (Thursday, January 19, 2017)]
[Notices]
[Pages 6610-6611]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-01260]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5967-N-01]


HUD Approval of Requests for Transfers of Multifamily Housing 
Project-Based Rental Assistance, HUD-Held or Insured Debt, and Income-
Based Use Restrictions

AGENCY: Office of the Assistant Secretary for Housing-Federal Housing 
Commissioner, HUD.

ACTION: Notice.

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SUMMARY: This notice establishes the terms and conditions by which HUD 
will approve a request for the transfer of project-based rental 
assistance, debt held or insured by the Secretary, and statutorily 
required income-based use restrictions from one multifamily housing 
project to another (or between several such projects). The Department 
of Housing and Urban Development Appropriations Act, 2016 gives the 
Secretary the authority to approve transfer requests for fiscal years 
(FY) 2016 and 2017, provided that the Secretary publish a notice in the 
Federal Register establishing the terms and conditions for HUD approval 
of

[[Page 6611]]

such transfers no later than 30 days before such notice takes effect. 
In FY 2016, HUD continued to utilize the FY 2015 published criteria, 
which covered authority enacted for both FY 2015 and FY 2016. For FY 
2017, HUD continues to utilize, without revision, the published FY 2015 
criteria. HUD believes that criteria established and published in FY 
2015, and cross-refenced in this notice, will continue to assist 
project owners to determine whether a transfer is feasible given the 
specific circumstances of their multifamily projects.

DATES: Effective Date: February 21, 2017.

FOR FURTHER INFORMATION CONTACT: Katherine Nzive, Director, Program 
Adminstration Office, Office of Asset Management and Portfolio 
Oversight of Multifamily Housing, Office of Housing, Department of 
Housing and Urban Development, 451 7th Street SW., Room 6110, 
Washington, DC 20410; telephone number 202-402-3440 (this is not a 
toll-free number). Persons with hearing or speech impairments may 
access this number through TTY by calling the toll-free Federal Relay 
Service at 800-877-8339.

SUPPLEMENTARY INFORMATION: Beginning with section 318 of the Department 
of Housing and Urban Development Appropriations Act, 2006 (Pub. L. 109-
115, 119 Stat. 2396, approved November 30, 2005), HUD appropriations 
acts have contained a general provision authorizing the Secretary to 
approve requests from project owners for the transfer of certain rental 
assistance, debt, and income-based use restrictions between HUD-
assisted projects. For fiscal year 2017, this transfer authority is 
provided under section 212 of of the Consolidated Appropriations Act, 
216 (Pub. L. 114-113, 129 Stat. 2889, approved December 18, 2015 
(Section 212). Section 212(a) states that ``[n]otwithstanding any other 
provision of law . . . the Secretary of Housing and Urban Development 
may authorize the transfer of some or all project-based assistance, 
debt held or insured by the Secretary and statutorily required low-
income and very low-income use restrictions if any, associated with one 
or more multifamily housing project or projects to another multifamily 
housing project or projects.'' Section 212(b) also allows for phased 
transfers of project-based assistance to accommodate the financing and 
other requirements related to rehabilitating or constructing the 
project or projects to which the assistance is transferred.
    HUD approval of transfers is subject to the conditions enumerated 
in the appropriations act for the applicable fiscal year. These 
statutory terms and conditions have, in general, been consistent from 
one appropriations act to the next. The statutory criteria for FY 2017 
is enumerated in section 212(c), which provides as follows:

    (c) The transfer authorized in subsection (a) is subject to the 
following conditions:
    (1) NUMBER AND BEDROOM SIZE OF UNITS.--
    (A) For occupied units in the transferring project: the number 
of low-income and very low-income units and the configuration (i.e. 
bedroom size) provided by the transferring project shall be no less 
than when transferred to the receiving project or projects and the 
net dollar amount of Federal assistance provided to the transferring 
project shall remain the same in the receiving project or projects.
    (B) For unoccupied units in the transferring project: the 
Secretary may authorize a reduction in the number of dwelling units 
in the receiving project or projects to allow for a reconfiguration 
of bedroom sizes to meet current market demands, as determined by 
the Secretary and provided there is no increase in the project-based 
assistance budget authority.
    (2) The transferring project shall, as determined by the 
Secretary, be either physically obsolete or economically nonviable.
    (3) The receiving project or projects shall meet or exceed 
applicable physical standards established by the Secretary.
    (4) The owner or mortgagor of the transferring project shall 
notify and consult with the tenants residing in the transferring 
project and provide a certification of approval by all appropriate 
local governmental officials.
    (5) The tenants of the transferring project who remain eligible 
for assistance to be provided by the receiving project or projects 
shall not be required to vacate their units in the transferring 
project or projects until new units in the receiving project are 
available for occupancy.
    (6) The Secretary determines that this transfer is in the best 
interest of the tenants.
    (7) If either the transferring project or the receiving project 
or projects meets the condition specified in subsection 
(d)(2)(A),\1\ any lien on the receiving project resulting from 
additional financing obtained by the owner shall be subordinate to 
any FHA-insured mortgage lien transferred to, or placed on, such 
project by the Secretary, except that the Secretary may waive this 
requirement upon determination that such a waiver is necessary to 
facilitate the financing of acquisition, construction, and/or 
rehabilitation of the receiving project or projects.
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    \1\ Subsection (d)(2)(A) pertains to housing that is subject to 
a mortgage insured under the National Housing Act (12 U.S.C. 1701 et 
seq.).
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    (8) If the transferring project meets the requirements of 
subsection (d)(2),\2\ the owner or mortgagor of the receiving 
project or projects shall execute and record either a continuation 
of the existing use agreement or a new use agreement for the project 
where, in either case, any use restrictions in such agreement are of 
no lesser duration than the existing use restrictions.
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    \2\ Subsection (d)(2) defines the term ``multifamily housing 
project.''
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    (9) The transfer does not increase the cost (as defined in 
section 502 of the Congressional Budget Act of 1974, as amended) of 
any FHA-insured mortgage, except to the extent that appropriations 
are provided in advance for the amount of any such increased cost.

    Section 212 (e)(1) requires that HUD publish by notice in the 
Federal Register the terms and conditions for HUD approval of 
transfers, no later than 30 days before such notice takes effect. This 
notice is being issued in accordance with the publication requirements 
of section 212(e)(1). In this Federal Register notice, HUD advises that 
the criteria for approval of transfers are unchanged from those in 
effect for fiscal years 2015 and 2016 and published in the Federal 
Register on March 31, 2015, at 80 FR 16963.\3\ For the convenience of 
the reader, the criteria can also be found in Microsoft Word format on 
HUD's webpage at: http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/mfh/memos_letters.
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    \3\ See https://www.gpo.gov/fdsys/pkg/FR-2015-03-31/pdf/2015-06776.pdf.
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    This notice will become effective February 21, 2017. HUD will begin 
accepting requests for transfers pursuant to this notice on or after 
the effective date. For questions regarding the submission or status of 
a transfer request, interested parties should contact their local HUD 
Multifamily Regional Center or Satellite Office. The list of HUD 
Multifamily Regional Centers and Satellite Offices is available at: 
http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/mfh/hsgmfbus/abouthubspcs.

    Dated: January 12, 2017.
Edward L. Golding,
Principal Deputy Assistant Secretary for Housing.
[FR Doc. 2017-01260 Filed 1-18-17; 8:45 am]
 BILLING CODE 4210-67-P