[Federal Register Volume 86, Number 20 (Tuesday, February 2, 2021)]
[Notices]
[Pages 7840-7852]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-02193]


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 Notices
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  Federal Register / Vol. 86, No. 20 / Tuesday, February 2, 2021 / 
Notices  

[[Page 7840]]



DEPARTMENT OF AGRICULTURE

Rural Housing Service

[Docket No. RHS-21-MFH-0004]


Notice of Solicitation of Applications for Section 514 Off-Farm 
Labor Housing Loans and Section 516 Off-Farm Labor Housing Grants for 
New Construction for Fiscal Year 2021

AGENCY: Rural Housing Service, United States Department of Agriculture.

ACTION: Notice.

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SUMMARY: The Rural Housing Service (RHS), an agency of the United 
States Department of Agriculture (USDA), announces that it is 
soliciting competitive pre-applications for Section 514 Off-Farm Labor 
Housing (Off-FLH) loans and Section 516 Off-FLH grants for the 
construction of new Off-FLH units for domestic farm laborers, retired 
domestic farm laborers, or disabled domestic farm laborers. The program 
objective is to increase the supply of affordable housing for farm 
laborers. This Notice describes the method used to distribute funds, 
the pre-application and final application process, and submission 
requirements.

DATES: Eligible pre-applications submitted to the Production and 
Preservation Division, Processing and Report Review Branch, for this 
Notice will be accepted until November 1, 2022, 12:00 p.m., Eastern 
Standard Time. See the SUPPLEMENTARY INFORMATION section for additional 
information.

ADDRESSES: Applications to this Notice must be submitted electronically 
to the Production and Preservation Division, Processing and Report 
Review Branch. Specific instructions on how to submit applications 
electronically are provided below within this Notice under 
SUPPLEMENTARY INFORMATION.

FOR FURTHER INFORMATION CONTACT: Jonathan Bell, Branch Chief, 
Processing and Report Review Branch 1, Production and Preservation 
Division, Multifamily Housing Programs, Rural Development, United 
States Department of Agriculture, via email: [email protected] or 
phone at: 254-742-9764.

SUPPLEMENTARY INFORMATION: The amount of program dollars available will 
be determined by yearly appropriations. Available loan and grant 
funding amounts can be found at the following link: https://www.rd.usda.gov/programs-services/farm-labor-housing-direct-loans-grants. Expenses incurred in developing pre-applications and final 
applications will be at the applicant's sole risk.

Application Submission Deadlines

    There will be three rounds of pre-application submissions and 
selections set forth below. Pre-applications that are deemed eligible 
but are not selected for further processing for each individual fiscal 
year that this Notice is open, will be withdrawn from processing. The 
applicant may reapply in a future funding round. RHS will not consider 
any application that is received after the established deadlines unless 
the date and time are extended by another Notice published in the 
Federal Register. RHS may at any time supplement, extend, amend, 
modify, or supersede this Notice by publishing another Notice in the 
Federal Register.
    The application deadlines are as follows:

First Round

    1. Available loan and grant funding posted to the RHS website by 
February 5, 2021.
    2. Pre-applications must be submitted by April 1, 2021, 12:00 p.m., 
Eastern Standard Time.
    3. RHS notification to applicants by June 1, 2021.
    4. Pre-application selections posted to the RHS website by July 1, 
2021.
    5. Final applications must be submitted by August 2, 2021, 12:00 
p.m., Eastern Standard Time.
    6. Funds must be obligated by September 30, 2021.

Second Round

    1. Available loan and grant funding posted to the RHS website by 
August 2, 2021.
    2. Pre-applications will be accepted after September 1, 2021.
    3. Pre-applications must be submitted by November 1, 2021, 12:00 
p.m., Eastern Standard Time.
    4. RHS notification to applicants by January 4, 2022.
    5. Pre-application selections posted to the RHS website by March 1, 
2022.
    6. Final applications must be submitted by May 2, 2022, 12:00 p.m., 
Eastern Standard Time.
    7. Funds must be obligated by September 30, 2022.

Third Round

    1. Available loan and grant funding posted to the RHS website by 
August 1, 2022.
    2. Pre-applications will be accepted after September 1, 2022.
    3. Pre-applications must be submitted by November 1, 2022, 12:00 
p.m., Eastern Standard Time.
    4. RHS notification to applicants by January 2, 2023.
    5. Pre-application selections posted to the RHS website by March 1, 
2023.
    6. Final applications must be submitted by May 1, 2023, 12:00 p.m., 
local time.
    7. Funds must be obligated by September 29, 2023.

Priority Language for Funding Opportunities

    RHS encourages applications that will help advance equity and 
improve outcomes in rural America. To encourage investments in rural 
properties, RHS will award points to projects located in rural 
Opportunity Zones where projects should provide measurable results in 
helping communities build robust and sustainable economies. An 
Opportunity Zone is an economically distressed community where new 
investments, under certain conditions, may be eligible for preferential 
tax treatment. Localities qualify as Opportunity Zones if they have 
been nominated for that designation by the state and that nomination 
has been certified by the Secretary of the U.S. Treasury via his 
delegation of authority to the Internal Revenue Service. See https://www.irs.gov/newsroom/opportunity-zones-frequently-asked-questions for 
more information.
    To focus investments in areas where the need for increased 
prosperity is greatest, RHS will set aside 10 percent of the available 
funds for applications that will serve persistent poverty

[[Page 7841]]

counties for each individual fiscal year that this Notice is open. 
Persistent poverty counties are areas where at least 20 percent of the 
population is living in poverty over the last 30 years (measured by the 
1980, 1990, 2000 and 2010 decennial censuses and 2007-2011 American 
Community Survey five-year estimates) according to the American 
Community Survey census tract data. Information on which counties are 
considered persistent poverty counties can be found through the USDA 
Economic Research Service (ERS) (http://ers.usda.gov/). ERS is the main 
source of economic information and research for USDA and a principal 
Agency of the U.S. Federal Statistical System located in Washington, 
DC. Set-aside funds will be awarded in the order of receipt of pre-
applications. Once the set-aside funds are exhausted for each 
individual fiscal year that this Notice is open, any further set-aside 
applications will be evaluated and ranked with the other applications 
submitted in response to this Notice. If, after the preapplications are 
reviewed, RHS does not receive enough eligible applications to fully 
utilize the 10 percent set-aside in the service of these areas in each 
individual fiscal year that this Notice is open, RHS will award any 
unused set-aside funds to other eligible applicants.
Overview
    Federal Agency: Rural Housing Service.
    Funding Opportunity Title: Notice of Solicitation of Applications 
for Section 514 Off-Farm Labor Housing Loans and Section 516 and Off-
Farm Labor Housing Grants for New Construction for Fiscal Year 2021.
    Announcement Type: Solicitation of applications from qualified 
applicants for Fiscal Year 2021.
    Catalog of Federal Domestic Assistance Numbers (CFDA): 10.405 and 
10.427.

A. Federal Award Description

    Pre-applications will only be accepted through the dates and times 
listed in this Notice. All awards are subject to the availability of 
funding. The maximum award per selected project may not exceed $5 
million (total loan and grant).
    A state will not receive more than 30 percent of the Off-FLH 
funding for each fiscal year that this Notice is open, unless there are 
remaining Section 514 and Section 516 funds after all eligible 
applications Nationwide have been funded. In this case, funds will be 
awarded to the next highest-ranking eligible applications among all of 
the remaining unfunded applications within the applicable application 
round. The allocation of these funds may result in a state or states 
exceeding the 30 percent limitation.
    Section 516 Off-FLH grants may not exceed 90 percent of the total 
development cost (TDC) of the housing. TDC is defined in 7 CFR 3560.11. 
Section 514 Off-FLH loans may not exceed the limits set forth in 7 CFR 
3560.562(b).
    If leveraged funds are going to be used and are in the form of Low-
Income Housing Tax Credits (LIHTC), the applicant must include in the 
pre- application, written evidence that a LIHTC application has been 
submitted and accepted by the Housing Finance Agency (HFA). Applicants 
without written evidence that a tax credit application has been 
submitted and accepted by an HFA must certify in writing within the 
pre-application that they will apply for tax credits to an HFA, obtain 
a firm commitment letter, and include the commitment letter within 
their final application submission, if available. The firm commitment 
letter from the HFA must be submitted prior to the approval of the 
final application. If the applicant is unable to secure a firm 
commitment letter from the HFA in order to submit it to RHS by 
September 30th of the relevant fiscal year, the application will be 
deemed incomplete and the applicant will be notified in writing that 
the application will not be considered for funding.
    Pre-applications that propose the use of other forms of leveraged 
funds must submit firm commitment letters within their final 
application, if available. If the applicant is unable to secure a firm 
commitment letter from the funding source in order to submit it by 
September 30th of the relevant fiscal year, the application will be 
deemed incomplete and the applicant will be notified in writing that 
the application will not be considered for funding.
    A firm commitment letter is defined as a lender's unqualified 
pledge to the borrower that they have passed their underwriting 
guidelines and they are willing to offer the borrower a loan and/or 
grant under specified terms. The letter validates that the borrower's 
financing has been fully approved and that the lender is prepared to 
close the transaction. Preliminary commitment letters, term sheets, or 
any other letter from the lender that does not meet the definition 
above will not be considered a firm commitment letter and will not meet 
the requirements specified in this Notice.
    Rental Assistance (RA) and Operating Assistance (OA) will be 
available for this Notice. OA is described in 7 CFR 3560.574 and may be 
used in lieu of tenant-specific RA in Off-FLH projects financed under 
Section 514 or Section 516(i) of the Housing Act of 1949 (U.S.C. 
1486(i)) as amended (42 U.S.C. 1484 and 1486(h) respectively), that 
serve migrant farmworkers as defined in 7 CFR 3560.11.
    In order to maximize the use of the limited supply of FLH funds, 
RHS may contact eligible applicants selected for an award in point 
score order starting with the highest score, with proposals to modify 
the transaction's proportions of loan and grant funds for each 
individual fiscal year that this Notice is open. In addition, if funds 
remain after the highest scoring eligible applications are selected for 
awards, we may contact those eligible applicants selected for the 
awards, in point score order, starting with the highest score, to 
ascertain whether those respondents will accept the remaining funds for 
each individual fiscal year that this Notice is open.
    In order to enhance customer service and the transparency of this 
program, RHS will publish a list of awardees, the loan and/or grant 
amounts of their respective awards, the self-score provided by the 
applicant, and the final score as computed by RHS in accordance with 
the dates listed in this Notice. This will be done for each funding 
round. This information can be found at: https://www.rd.usda.gov/programs-services/farm-labor-housing-direct-loans-grants. RHS reserves 
the right to post all information submitted as part of the pre-
application and final application package, which is not protected under 
the Privacy Act, on a public website with free and open access to any 
member of the public.

B. Eligibility Information

1. Eligibility

    Housing Eligibility--housing that is constructed with FLH loans 
and/or grant funds must meet RHS's design and construction standards 
contained in 7 CFR part 1924, subparts A and C. Once constructed, Off-
FLH must be managed in accordance with 7 CFR part 3560. In addition, 
Off-FLH must be operated on a non-profit basis and tenancy must be open 
to all qualified domestic farm laborers, regardless of which farm they 
work. Section 514(f)(3) of the Housing Act of 1949, as amended (42 
U.S.C. 1484(f)(3)) defines domestic farm laborers to include any person 
regardless of the person's source of employment, who receives a 
substantial portion of his/her income from the primary production of 
agricultural or aqua cultural commodities in the

[[Page 7842]]

unprocessed or processed stage, and also includes the person's family.
    Tenant Eligibility--tenant eligibility is limited to persons who 
meet the definition of a ``domestic farm laborer,'' or a ``disabled 
domestic farm laborer,'' or a ``retired domestic farm laborer'' as 
defined in Section 514(f)(3) of the Housing Act of 1949, as amended (42 
U.S.C. 1484(f)(3)).
    Section 514(f)(3)(A) of the Housing Act of 1949 (42 U.S.C. 
1484(f)(3)(A)) has been amended to extend FLH tenant eligibility to 
agricultural workers legally admitted to the United States and 
authorized to work in agriculture. In addition, under no circumstance 
may any currently eligible FLH tenants be displaced from their homes as 
a result of this statutory change.
    Owners are responsible for verifying tenant income eligibility. 
Only very-low or low-income households are eligible for the operating 
assistance rents. Households with incomes above the low-income limits 
must pay the full rent.
    In accordance with 7 CFR 3560.554, off-farm labor housing may be 
used to serve migrant farmworkers. Migrants or migrant agricultural 
laborer is a person (and the family of such person) who receives a 
substantial portion of his or her income from farm labor employment and 
who establishes a residence in a location on a seasonal or temporary 
basis, in an attempt to receive farm labor employment at one or more 
locations away from their home base state, excluding day-haul 
agricultural workers whose travels are limited to work areas within one 
day of their residence.
    Seasonal housing is housing that is operated on a seasonal basis, 
typically for migrants or migrant agricultural laborers as opposed to 
year-round. Off-FLH loan and grant funds may be used to provide 
facilities for seasonal or temporary residential use with appropriate 
furnishings and equipment. A temporary residence is a dwelling which is 
used for occupancy, usually for a short period of time, but is not the 
legal residence for the occupant.
    The design and construction requirements established in Sec.  
3560.60 apply to all applications for Off-FLH loans and grants except 
that seasonal Off-FLH that will be occupied for eight months or less 
per year by migrant farmworkers while they are away from their 
residence, may be constructed in accordance with Exhibit I of 7 CFR 
part 1924, subpart A.
    For Off-FLH operating on a seasonal basis, the management plan must 
establish specific opening and closing dates. During the off-season, 
Off-FLH may be used as defined in 7 CFR part 3560, subpart A, under 
short-term lease provisions. Where rents are charged on a per-unit 
basis and family income qualifies the household for rental assistance, 
rental assistance may be used.
    Off-FLH is subject to the tenant contribution and rental unit rent 
requirements for Plan II housing established under 7 CFR part 3560, 
subpart E, except where seasonal housing will be occupied for less than 
a three-month period. In such instances the best available and 
practical income verification methods may be used with prior approval 
of RHS.
    Actual dollars earned from farm labor by domestic farm laborers 
other than migrant farmworkers must equal at least 65 percent of the 
annual income limits indicated for the Standard Federal regions as 
published by RHS for their particular region of the country. For 
migrant farmworkers living in seasonal housing the actual dollars 
earned from farm labor by a domestic farm laborer must equal at least 
50 percent of annual income limits indicated for the Standard Federal 
regions, as published by RHS.
    Applicant Eligibility--
    (a) To be eligible to receive a Section 514 loan for Off-FLH, the 
applicant must meet the requirements of 7 CFR 3560.555(a) and be a 
broad-based non-profit organization of farmworkers, a Federally 
recognized Indian tribe, a community organization, or an Agency or 
political subdivision of state or local Government, and must meet the 
requirements of Sec.  3560.55, excluding Sec.  3560.55(a)(6). A broad-
based non-profit organization is a non-profit organization that has a 
membership that reflects a variety of interests in the area where the 
housing will be located; or a limited partnership with a non-profit 
general partner which meets the requirements of Sec.  3560.55(d).
    (b) To be eligible to receive a Section 516 grant for Off-FLH, the 
applicant must meet the requirements of 7 CFR 3560.555(b) and be a 
broad-based non-profit organization of farmworkers, a federally 
recognized Indian tribe, a community organization, or an agency or 
political subdivision of State or local Government, and must meet the 
requirements of Sec.  3560.55, excluding Sec.  3560.55(a)(6). A broad-
based non-profit organization is a non-profit organization that has a 
membership that reflects a variety of interests in the area where the 
housing will be located; and be able to contribute at least one-tenth 
of the total farm labor housing development cost from its own or other 
resources. The applicant's contribution must be available at the time 
of the grant closing. An Off-FLH loan financed by RHS may be used to 
meet this requirement, however, an RHS grant cannot be used to meet 
this requirement. Limited partnerships with a non-profit general 
partner are eligible for Section 514 loans; however, they are not 
eligible for Section 516 grants.
    (1) The applicant must be unable to provide the necessary housing 
from the applicant's own resources and be unable to obtain credit from 
any other source upon terms and conditions which the applicant could 
reasonably be expected to fulfill.
    (2) Provide evidence that the applicant is unable to obtain credit 
from other sources.
    (3) In order to demonstrate the applicant meets the requirement at 
7 CFR 3560.55(a)(2), at least two letters from two separate credit 
institutions which normally provide real estate loans in the area must 
be obtained and these letters must indicate the rates and terms upon 
which a loan might be provided. (Note: not required from State or local 
public agencies or Indian tribes.) If two letters from two separate 
credit institutions that indicate the rates and terms upon which a loan 
might be provided is not submitted within the pre-application, the pre-
application will be considered incomplete and will not be considered 
for funding.
    (4) Broad-based non-profit organizations must have a membership 
that reflects a variety of interests in the area where the housing will 
be located.
    2. Cost Sharing or Matching--the amount of any Off-FLH grant must 
not exceed 90 percent of the TDC as provided in 7 CFR 3560.562(c)(1).
    3. Other Requirements--the following requirements apply to loans 
and grants made in response to this Notice:
    (a) 7 CFR part 1901, subpart E, regarding equal opportunity 
requirements;
    (b) For grants only, 2 CFR parts 200 and 400, which establishes the 
uniform administrative and audit requirements for grants and 
cooperative agreements to State and local Governments and to non-profit 
organizations;
    (c) 7 CFR part 1901, subpart F, regarding historical and 
archaeological properties;
    (d) 7 CFR 1970.11, Timing of the environmental review process. 
Please note, the environmental information must be submitted by the 
applicant to RHS. RHS must review and determine that the environmental 
information is acceptable before the obligation of funds;
    (e) 7 CFR part 3560, regarding the loan and grant authorities of 
the Off-FLH program;

[[Page 7843]]

    (f) 7 CFR part 1924, subpart A, regarding planning and performing 
construction and other development;
    (g) 7 CFR part 1924, subpart C, regarding the planning and 
performing of site development work;
    (h) For construction financed with a Section 516 grant, the 
provisions of the Davis-Bacon Act (40 U.S.C. 276(a)-276(a)-5) and 
implementing regulations published at 29 CFR parts 1, 3, and 5;
    (i) A credit report fee of at least $24 will be charged to the 
applicant and paid to the United States Department of Agriculture. This 
fee is used to pay credit reports obtained by RHS;
    (j) Borrowers and grantees must take reasonable steps to ensure 
that tenants receive the language assistance necessary to afford them 
meaningful access to USDA programs and activities, free of charge. 
Failure to provide this assistance to tenants who can effectively 
participate in or benefit from Federally assisted programs or 
activities may violate the prohibition under Title VI of the Civil 
Rights Act of 1964, 42 U.S.C. 2000d et seq. and Title VI regulations 
against national origin discrimination.
    (k) In accordance with 7 CFR 3560.60, the housing must be 
economical to construct, operate, and maintain and must not be of 
elaborate design or materials.
    (l) System for Awards Management. All program applicants must be 
registered in the System for Awards Management (SAM) prior to 
submitting an application, unless determined exempt under 2 CFR 25.110. 
Federal award recipients must maintain an active SAM registration with 
current information at all times during which it has an active Federal 
award or an application under consideration by the Agency. The 
applicant must ensure that the information in the database is current, 
accurate, and complete. Applicants must ensure they complete the 
Financial Assistance General Certifications and Representations in SAM.

C. Pre-Application and Submission Information

1. Pre-Application Submission

    The application process will be in two phases, for each individual 
fiscal year that this Notice is open: The initial pre-application and 
the submission of a final application. Only those pre-applications that 
are selected for further processing will be invited to submit a final 
application. In the event that a pre-application is selected for 
further processing and the applicant declines, the next highest ranked 
pre-application will be selected for further processing in each 
individual fiscal year that this Notice is open. All pre-applications 
for Section 514 and Section 516 funds must meet the requirements of 
this Notice. Incomplete pre-applications will be rejected and returned 
to the applicant. No pre-application will be accepted after the 
deadline in a given round unless the date and time is extended by 
another Notice published in the Federal Register.
    Pre-applications should be submitted electronically. The process 
for submitting an electronic application to RHS is as follows:
    (a) At least two business days prior to the application deadline 
for the applicable funding round, the applicant must email RHS a 
request to create a shared folder in CloudVault. The email must be sent 
to the following address: [email protected]. The email must 
contain the following information:
    (1) Subject line: ``Off-FLH Application Submission.''
    (2) Body of email: Borrower Name, Project Name, Borrower Contact 
Information, Project State.
    (3) Request language: ``Please create a shared CloudVault folder so 
that we may submit our application documents.''
    Once the email request to create a shared CloudVault folder has 
been received, a shared folder will be created within two business 
days. When the shared CloudVault folder is created by RHS, the system 
will automatically send an email to the applicant's submission email 
with a link to the shared folder. All required application documents in 
accordance with this Notice must be loaded into the shared CloudVault 
folder. When the submission deadline is reached for each applicable 
funding round, the applicant's access to the shared CloudVault folder 
will be removed. Any document uploaded to the shared CloudVault folder 
after the application deadline, for each applicable funding round, will 
not be reviewed or considered.
    The applicant should upload a Table of Contents of all of the 
documents that have been uploaded to the shared CloudVault folder. 
Last-minute requests and submissions may not allow adequate time for 
the submission process to take place prior to the deadline. Applicants 
are reminded that all submissions must be received by the deadline, for 
each applicable funding round, and the application will be rejected if 
it is not received by the deadline date and time, regardless of when 
the application was submitted.
    (b) Prior to the submission of a pre-application, the applicant is 
encouraged to schedule a concept meeting with RHS to discuss the 
application process, the specifics on the proposed project, and the 
borrower's responsibilities under the Off-FLH program, among other 
topics. Requests for concept meetings can be sent to the following 
email address: [email protected].
    (c) If a pre-application is accepted for further processing, the 
applicant must submit a final application, acceptable to RHS, prior to 
the obligation of funds. If the pre-application is not accepted for 
further processing due to being incomplete or ineligible, the applicant 
will be notified of appeal rights under 7 CFR part 11. Pre-applications 
that are deemed eligible but are not selected for further processing 
for each individual fiscal year that this Notice is open will be 
withdrawn from processing. The applicant may reapply in a future 
funding round.

2. Pre-Application Requirements

    (a) The pre-application must contain the following:
    (1) An executed and dated Executive Summary on the applicant's 
letterhead that must include at least the following:
    (i) Brief description of the proposed project. Be sure to address 
if the project will be used year-round or seasonally and to what 
standards the housing will be built.
    (ii) Document the need for the project. The applicant must document 
that the housing and related facilities will fulfill a pressing need in 
the area in which the project will be located.
    (iii) Description of the proposed ownership structure with an 
organizational chart.
    (iv) Narrative verifying the applicant's ability to meet the 
eligibility requirements stated earlier in this Notice.
    (v) A statement of the applicant's experience in operating labor 
housing or other rental housing. If the applicant's experience is 
limited, additional information should be provided to indicate how the 
applicant plans to compensate for this limited experience (i.e., 
obtaining assistance and advice of a management firm, non-profit group, 
public agency, or other organization which is experienced in rental 
management and will be available on a continuous basis).
    (vi) Description of the applicant's legal and financial capability 
to carry out the obligation of the loan and/or grant.
    (vii) Proposed management. A brief statement explaining the 
applicant's proposed method of operation and management (i.e., on-site 
manager, contract for management services, etc.).

[[Page 7844]]

As stated earlier in this Notice, the housing must be managed in 
accordance with the program's management regulations, 7 CFR part 3560.
    (viii) Description of established site control.
    (ix) Proposed Return to Owner (RTO), if applicable.
    (x) Any financial commitments, financial concessions, or other 
economic benefits proposed to be provided by RHS.
    (xi) Third-party funding, if applicable. For each third-party 
funding source or leveraged funds, discuss briefly the funding 
provider, funding amount, including terms, commitment status, timing 
issues, any restrictions that will be applicable to the project, and 
whether any accommodation from RHS is proposed, such as a subordination 
in lien position. The desired lien position of any third-party funding 
source must be clearly disclosed as well as any proposal for RHS to 
subordinate its lien position.
    (xii) Any proposed compensation to parties having an identity of 
interest with either the seller, purchaser, consultant, or Technical 
Assistance (TA) provider, etc.
    (xii) Any proposed construction financing, for example, a 
construction or bridge loan or the use of multiple advances.
    (xiv) Type and method of construction such as owner builder, 
negotiated bid, or contractor method.
    (xv) If a FLH grant is desired, a statement concerning the need for 
a FLH grant. The statement must include estimates of the rents required 
with a grant and rents required without a grant. Documentation to 
demonstrate how the rent figures were computed must be provided. 
Documentation must be in the form of a completed Form RD 3560-7 
``Multiple Family Housing Project Budget/Utility Allowance'' completed 
as if a grant were received and another form completed as if a grant 
would not be received. RHS will review each budget to determine that 
the income and expenses are reasonable and customary for the area. RHS 
will then verify that the proposed rental rates provided on the budget 
that considers rents without a grant, are at or above market rate rents 
or at a level that would overburden the intended residents based on the 
average income of eligible FLH workers in the primary market area as 
provided in the market study.
    (xvi) If RA or OA is desired, a statement concerning the need for 
the RA or OA and a statement concerning the specific number of units of 
RA or OA that is needed. Strong and detailed justification must be 
provided for requests of 100 percent RA or OA.
    (xvii) Statement by the applicant that they will pay any cost 
overruns.
    (xviii) Estimated development timeline to include estimated start 
and end date as well as any other important milestones.
    (xix) Description of any required site development such as building 
roads, obtaining easements, installing utilities, verification that 
there is proper site access, and any state or local approvals such as 
zoning.
    (xx) Description of the required and intended applicant 
contribution.
    (xxi) Any other pertinent information that the applicant feels 
should be disclosed as part of this proposal, if applicable.
    (2) Standard Form 424 ``Application for Federal Assistance'' which 
can be obtained at: https://www.grants.gov/.
    (3) Current (within six months of this Notice's pre-application 
submission due date of the applicable funding round) financial 
statements for each entity within the ownership structure with the 
following paragraph certified by the applicant's designated and legally 
authorized signer:
    ``I/we certify the above is a true and accurate reflection of our 
financial condition as of the date stated herein. This statement is 
given for the purpose of inducing the United States of America to make 
a loan or to enable the United States of America to make a 
determination of continued eligibility of the applicant for a loan as 
requested in the loan application of which this statement is a part.''
    (4) A check for $24 made out to the United States Department of 
Agriculture. This will be used to pay for credit reports obtained by 
RHS. The check must be mailed to the following address and received 
prior to the application deadline for the applicable funding round. If 
the check is not received by the application deadline for the 
applicable funding round, the application will be considered incomplete 
and will not be considered for funding.

Tonya Boykin, Management Assistant, United States Departments of 
Agriculture, 1400 Independence Avenue SW, Room 1263-S, STOP 0782, 
Washington, DC 20250

    (5) Evidence that the applicant is unable to obtain credit from 
other sources. At least two letters from two separate credit 
institutions which normally provide real estate loans in the area must 
be obtained and these letters must indicate the rates and terms upon 
which a loan might be provided. RHS will review each letter to verify 
that the applicant is only able to obtain market rate financing, which 
would include a market rate interest rate and term of less than 30 
years.
    (6) Letter from the IRS indicating the applicant's tax 
identification number.
    (7) Documentation verifying the applicant's DUNS number, if 
applicable.
    (8) Proposed limited partnership agreement and certificates of 
limited partners, if applicable. (Agency requirements should be 
contained in one section of the agreement and their location identified 
by the applicant or their attorney in a cover sheet.)
    (9) If a non-profit organization:
    (i) Tax-exempt ruling from the IRS designating them as a 501(c)(3) 
or 501(c)(4) organization. If the designation is pending, a copy of the 
designation request must be submitted.
    (ii) Purpose statement, including the provision of low-income 
housing.
    (iii) Evidence of organization under Tribal, state and local law, 
or copies of pending applications and a copy of the applicant's 
charter, Articles of Incorporation, and by-laws.
    (iv) List of Board of Directors including their names, occupations, 
phone numbers, and addresses.
    (v) If a member or subsidiary of another organization, the 
organization's name, address, and nature of business.
    (10) Market feasibility documentation to identify the supply and 
demand for Off-FLH in the primary market area. A market study must be 
submitted. The market area must be clearly identified and may include 
only the area from which tenants can reasonably be drawn for the 
proposed project. Documentation must be provided to justify a need 
within the intended primary market area for the housing of domestic 
farm laborers. The documentation must also consider disabled and 
retired farm workers and adjusted medium incomes of very-low, low, and 
moderate. The market study must include all of the content in Exhibit 
4-10 and Exhibit 4-11. These exhibits are located in HB-1-3560, Chapter 
4, Section 4.18. The market study must also include documentation of 
all the elements in Attachment 4-F, located in HB-1-3560, Chapter 4. 
The provider must include a copy of Attachment 4-F within the report 
and provide the page number of the report where it contains the 
information that satisfies each element of Attachment 4-F. The market 
study must be obtained from, and performed by, an independent third-
party provider that has no identity of interest with the property 
owner, management agent, applicant or any other principle or

[[Page 7845]]

affiliate. The market study must also include the following:
    (i) The annual income level of farmworker families in the area and 
the probable income of the farm workers who will likely occupy the 
proposed housing;
    (ii) A realistic estimate of the number of farm workers who remain 
in the area where they harvest and the number of farm workers who 
normally migrate into the area. Information on migratory workers should 
indicate the average number of months the migrants reside in the area 
and an indication of what type of households are represented by the 
migrants (i.e., single individuals as opposed to families);
    (iii) General information concerning the type of labor-intensive 
crops grown in the area and prospects for continued demand for farm 
laborers;
    (iv) The overall occupancy rate for comparable rental units in the 
area and the rents charged and customary rental practices for these 
units (i.e., will they rent to large families, do they require annual 
leases, etc.);
    (v) The number, condition, adequacy, rental rates and ownership of 
units currently used or available to farm workers;
    (vi) Information on any proposed new construction of housing units 
within the primary market area. The building permit information and 
pending tax credit applications must be checked for the primary market 
area;
    (vii) Documentation verifying that interviews were conducted with 
farms and other agricultural businesses within the primary market area 
to inquire if they are in need of additional housing for their 
employees or if they plan to expand and hire additional employees that 
will need housing; and
    (viii) A description of the proposed units, including the number, 
type, size, rental rates, amenities such as carpets and drapes, related 
facilities such as a laundry room or a community room and other 
facilities providing supportive services in connection with the housing 
and the needs of the prospective tenants such as a health clinic or day 
care facility.
    (11) Evidence of site control, such as an executed option contract 
or sales contract. In addition, a map and description of the proposed 
site, including the availability of water, sewer, and utilities and the 
proximity to community facilities and services such as shopping, 
schools, transportation, doctors, dentists, and hospitals. Off-FLH 
projects must comply with the site requirements in 7 CFR 3560.558 with 
the exception of the requirement that the property be located in a 
designated place.
    (12) A supportive services plan which describes services that will 
be provided on-site or made available to tenants through cooperative 
agreements with service providers in the community, such as a health 
clinic or day care facility. Off-site services must be accessible and 
affordable to farm workers and their families. A map showing the 
location of supportive services must be included. Letters of commitment 
from service providers are acceptable documentation. The plan must 
describe how the services will be funded. RA may not fund supportive 
services.
    (13) Preliminary plans and specifications, including a plot plan, 
site plan with contour lines, floor plan for each living unit type and 
other spaces, such as laundry facilities, community rooms, stairwells, 
etc., building exterior elevations, typical building exterior wall 
section, building layouts, and type of construction and materials. The 
housing must meet RHS's design and construction standards contained in 
7 CFR part 1924, subparts A and C, and must also meet all applicable 
federal, state, and local accessibility standards and be in compliance 
with all building codes. Also, applications for Off-FLH loans and 
grants must meet the design requirements in 7 CFR 3560.559.
    (14) Provide a description of the proposed interior/exterior 
washing facilities. Applicants should consider incorporating interior/
exterior washing facilities for tenants, as necessary to protect the 
asset and the tenants from excess dirt and chemical exposure. Such 
facilities might include a boot washing station or hose bibs, among 
others.
    (15) Description and justification of related facilities and a 
schedule of separate charges for the related facilities.
    (16) The applicant must submit a checklist, certification, and 
signed affidavit by the project architect or engineer, as applicable, 
for any energy programs the applicant intends to participate in.
    (17) A Sources and Uses Statement which shows all sources of 
funding included in the proposed project. The terms and schedules of 
all sources included in the project should be included in the Sources 
and Uses Statement. (Note: Section 516 grants may not exceed 90 percent 
of the TDC of the project).
    (18) Evidence of the submission of the project description to the 
applicable State Housing Preservation Office (SHPO), and/or Tribal 
Historic Preservation Officer (THPO) with the request for comments.
    (19) Evidence of compliance with Executive Order 12372. The 
applicant must send a copy of Form SF-424, ``Application for Federal 
Assistance,'' to the applicant's State clearinghouse for 
intergovernmental review. If the applicant is located in a State that 
does not have a clearinghouse, the applicant is not required to submit 
the form. However, evidence that the State does not have a 
clearinghouse must be submitted. Applications from Federally recognized 
Indian tribes are not subject to this requirement.
    (20) Phase I Environmental Site Assessment, ASTM E-1527 (Phase I 
ESA).
    (22) FEMA Form 81-93, Standard Flood Hazard Determination.
    (23) Comments regarding relevant offsite conditions.
    (24) The following forms are required to be submitted with the pre-
application:
    (i) Awards made under this Notice are subject to the provisions 
contained in the Consolidated Appropriations Act, 2021 (Pub. L. 116-
260) sections 745 and 746 regarding felony convictions and corporate 
Federal tax delinquencies. To comply with these provisions, applicants 
that are, or propose to be, corporations will submit form AD-3030, 
``Representations Regarding Felony Conviction and Tax Delinquent Status 
for Corporate Applicants,'' as part of their pre-application. Form AD-
3030 can be found at: http://www.ocio.usda.gov/document/ad3030.
    (ii) A prepared Form HUD-935.2A, ``Affirmative Fair Housing 
Marketing Plan (AFHMP)--Multifamily Housing'' in accordance with 7 CFR 
1901.203(c). The AFHMP will reflect that occupancy is open to all 
qualified ``domestic farm laborers,'' regardless of which farming 
operation they work for, and that they will not discriminate on the 
basis of race, color, sex, age, disability, marital or familial status 
or National origin in regard to the occupancy or use of the units. The 
AFHMP must include all attachments and supporting documentation. The 
form can be found at: http://portal.hud.gov/hudportal/documents/huddoc?id=935-2a.PDF.
    Indian Tribes, including instrumentalities of such Indian Tribes, 
are not required to comply with certain aspects of the AFHMP guidelines 
above, and may allow members of Indian Tribes to be given preference 
for housing. The Native American Housing Enhancement Act of 2005 
(NAHEA), Public Law 109-136, Codified at 25 U.S.C. 4101 et seq., 
amended Title V of the Housing Act of 1949 (42 U.S.C. 1471

[[Page 7846]]

et seq.) which created the housing programs administered by the United 
States Department of Agriculture, Rural Housing Service. The NAHEA 
excludes Indian Tribes, including instrumentalities of such Indian 
Tribes, from the requirement to comply with Title VI of the Civil 
Rights Act of 1964, and Title VIII of the Civil Rights Act of 1968, 
allowing members of Indian Tribes to be given preference for housing in 
accordance to the Native American Housing Assistance and Self 
Determination Act of 1996 (25 U.S.C. 4101 et seq.).
    The NAHEA does not exempt Indian Tribes from complying with other 
laws that apply to recipients of Federal financial assistance. 
Therefore, federally recognized Indian Tribes must continue to comply 
with Section 504 of the Rehabilitation Act of 1973, the Age 
Discrimination Act of 1975, and Title IX of the Education Amendments 
Act of 1972, where applicable. The NAHEA also did not exempt Indian 
Tribes from complying with the accessibility requirements of the Fair 
Housing Amendments Act (FHAA) of 1988. This Act amended Title VIII of 
the Fair Housing Act of 1968, to include disability and familial 
status. Therefore, the NAHEA did not specifically exempt Indian Tribes 
from the accessibility requirements of the FHAA. The requirements to 
construct multi-family housing properties accessible to, or adaptable 
for, persons with disabilities are to be followed. This requirement 
shall be consistent with RD Instructions 7 CFR part 3560, Sec.  
3560.60, Design Requirements.
    (iii) A proposed post-construction operating budget utilizing Form 
RD 3560-7, ``Multiple Family Housing Project Budget/Utility Allowance'' 
can be found at: http://forms.sc.egov.usda.gov/efcommon/eFileServices/eForms/RD3560-7.PDF.
    RHS will review the budget to determine that the income and 
expenses are reasonable and customary for the area. RHS will also 
verify that the budget reflects the correct and estimated RHS debt 
service, number of units, unit mix, and proposed rents. Overall, RHS 
will review the budget for feasibility, accuracy, and reasonableness.
    (iv) An estimate of development costs utilizing Form RD 1924-13 
``Estimate and Certificate of Actual Cost'' can be found at: http://forms.sc.egov.usda.gov/efcommon/eFileServices/eForms/RD1924-13.PDF.
    (v) Form RD 3560-30, ``Certification of no Identity of Interest 
(IOI),'' if applicable, can be found at: http://forms.sc.egov.usda.gov/efcommon/eFileServices/eForms/RD3560-30.PDF.
    (vi) Form RD 3560-31, ``Identity of Interest Disclosure/
Qualification Certification'' if applicable, can be found at: http://forms.sc.egov.usda.gov/efcommon/eFileServices/eForms/RD3560-31.PDF.
    An IOI is defined in 7 CFR 3560.11. RHS will review Form RD 3560-30 
and Form RD 3560-31, as applicable, to determine if they are completed 
in accordance with the Forms Manual Insert and to determine that all 
IOI's have been disclosed. TA will not be funded by RHS when an IOI 
exists between the TA provider and the loan or grant applicant.
    (vii) Form HUD 2530, ``Previous Participation Certification'' can 
be found at: https://www.hud.gov/sites/dfiles/OCHCO/documents/2530.pdf.
    (viii) If requesting RA or OA, Form RD 3560-25, ``Initial Request 
for Rental Assistance or Operating Assistance'' can be found at: http://forms.sc.egov.usda.gov/efcommon/eFileServices/eForms/RD3560-25.PDF.
    (ix) Form RD 400-4, ``Assurance Agreement'' can be found at: http://forms.sc.egov.usda.gov/efcommon/eFileServices/eForms/RD400-4.PDF.
    (x) RD Instruction 1940-Q, Exhibit A-1, ``Certification for 
contracts, grants and loans,'' can be found at: https://www.rd.usda.gov/files/1940q.pdf.
    A separate one-page information sheet listing each of the pre-
application scoring criteria contained in this Notice, followed by a 
reference to the page numbers of all relevant material and 
documentation that is contained in the proposal that supports the 
criteria. Applicants are encouraged to include a checklist of all of 
the application requirements in accordance with this Notice and to have 
their electronic application submission documents indexed in the order 
of this Notice to facilitate the review process. If any of the required 
items listed above are not submitted within the pre-application in 
accordance with this Notice or are incomplete, the pre-application will 
be considered incomplete and will not be considered for funding.
    RHS will not consider information from an applicant after the pre-
application deadline for the applicable funding round. RHS may contact 
the applicant to clarify items in the application. RHS will uniformly 
notify applicants of each curable deficiency. A curable deficiency is 
an error or oversight that if corrected it would not alter, in a 
positive or negative fashion, the review and rating of the application. 
An example of a curable (correctable) deficiency would be 
inconsistencies in the amount of the funding request.

D. Pre-Application Review Information

    1. Selection Criteria. Section 514 Off-FLH loan funds and Section 
516 Off-FLH grant funds will be distributed to states based on a 
national competition, as follows:
    (a) RHS will accept, review, and score pre-applications in 
accordance with this Notice.
    (1) Points will be allocated for applications that leverage other 
funds based on the ratio of leveraged funds to RHS's total investment. 
This is calculated as follows:
    The leverage ratio equals the sum of all permanent third-party 
project investments plus RHS's allowed value of donated land. The value 
of the donated land will be calculated in accordance with RHS's HB-1-
3560. The amount of permanent third-party project investments is 
limited to third-party funds from equity, grants, loans, and deferred 
developer fees. To obtain the ratio from which the leveraged funds 
points are derived, the leveraged fund amount is divided by RHS's 
investment, which equals the total amount of approved Section 514 loans 
and/or Section 516 grants. For example:
[GRAPHIC] [TIFF OMITTED] TN02FE21.002


[[Page 7847]]


    The leverage ratio is multiplied by 10 to determine the points 
value for this section. Using the above leverage ratio, this would be 
5.167 x 10, which equates to 51.67 score points for leverage.
    A score point for leverage of more than zero but less than one will 
be rounded to one point. A score point for leverage of zero or less 
will not receive any points. There is no maximum amount of score points 
for leverage. All score points for leverage will be rounded to two 
decimal places.
    Donated land must meet the requirements of 7 CFR 3560.56(c)(1)(iv). 
Land that has been donated and received points in the scoring process 
as donated land may not be considered an equity contribution nor may a 
return on the value of the land be allowed.
    (2) The presence of operational cost savings, such as tax 
abatements, non-RHS tenant subsidies or donated services are calculated 
on a per-unit cost savings for the sum of the savings. Savings must be 
available for at least five years and documentation must be provided 
within the pre-application demonstrating the availability of savings 
for five years. To calculate the savings, take the total amount of 
savings and divide it by the number of units in the project that will 
benefit from the savings to obtain the per-unit cost savings. For non-
RHS tenant subsidy, if the value changes during the five-year 
calculation, the applicant must use the lower of the non-RHS tenant 
subsidy to calculate per-unit cost savings. For example, a 10-unit 
property with 100 percent designated farm labor housing units receiving 
$20,000 per year non-RHS subsidy yields a cost savings of $100,000 
($20,000 x 5 years); resulting in a $10,000 per-unit cost savings 
($100,000/10 units).
    Use the following table to apply points:

------------------------------------------------------------------------
                    Per-unit cost savings                        Points
------------------------------------------------------------------------
Above $15,000................................................         50
$10,001-$15,000..............................................         35
$7,501-$10,000...............................................         20
$5,001-$7,500................................................         15
$3,501-$5,000................................................         10
$2,001-$3,500................................................          5
$1,000-$2,000................................................          2
------------------------------------------------------------------------

    Documentation must be provided within the pre-application that 
verifies the presence of operational cost savings. RHS will not be 
providing excess assistance to the project. This is determined by 
conducting a subsidy layering review and underwriting prior to the 
obligation of funds.
    (3) Ten points will be awarded to projects in Opportunity Zones. An 
Opportunity Zone is an economically distressed community where new 
investments, under certain conditions, may be eligible for preferential 
tax treatment. Localities qualify as Opportunity Zones if they have 
been nominated for that designation by the state and that nomination 
has been certified by the Secretary of the U.S. Treasury via his 
delegation of authority to the IRS. See https://www.irs.gov/newsroom/opportunity-zones-frequently-asked-questions for more information. 
Documentation must be provided within the pre-application that verifies 
the property is within an Opportunity Zone.
    (4) Points will be allocated for the presence of tenant supportive 
services. Two points will be awarded for each tenant service included 
in the tenant supportive services plan up to a maximum of 10 points. 
The plan must describe the proposed supportive services, including a 
description of the public or private funds that are expected to fund 
the proposed services as well as the way the services will be 
delivered, who will administer them, and where they will be 
administered. All tenant service plans must include letters of intent 
that clearly state the service that will be provided at the project for 
the benefit of the residents from any party administering each service, 
including the applicant. These services may include, but are not 
limited to, transportation related services, on-site English as a 
Second Language classes, move-in funds, emergency assistance funds, 
homeownership counseling, food pantries, after school tutoring, and 
computer learning centers. The proposed supportive services plan must 
describe how the services will meet the identified needs of the tenants 
and how the services will be provided on a consistent, long-term basis 
to support the tenants. The plan must clearly state how the services 
will be funded. RA may not be used to pay for these services.
    (5) Points will be allocated for Energy initiatives (the aggregate 
points for all the Energy Initiative categories may not exceed (20 
points)).
    Properties may receive points for energy initiatives in the 
categories of energy conservation, energy generation, water 
conservation and green property management. Properties may earn 
``energy initiative'' points for new construction.
    National energy programs including the U.S. Green Building 
Council's Leadership in Energy and Environmental Design (LEED (National 
Association of Homebuilders 2020 ICC 700 National Green Building 
Standard, U.S. Department of Energy (DOE) Zero Energy Ready Homes, 
International Living Future Institute's Living Building Challenge, U.S. 
Environmental Protection Agency (EPA) Energy Star for Homes, Passive 
House Institute's PHIUS +, Enterprise Community Partners Green 
Communities, and local energy conservation programs, will each have an 
initial checklist indicating prerequisites for participation in its 
energy program. The applicable energy program checklist will establish 
whether prerequisites for the energy program's participation will be 
met. All checklists must be accompanied by a signed affidavit by the 
project architect or engineer stating that the goals are achievable, 
and the project has been enrolled in these programs if enrollment is 
applicable to that program. These programs evolve and newer versions 
are published, sometimes annually. Projects must participate in the 
current version of the programs and must consult with the program 
provider for the most current, applicable and available programs for 
their project location. In addition, projects that apply for points 
under the energy generation category must include calculations of 
savings of energy. Compare property energy usage of three scenarios: 
(1) Property built to required code of state with no renewables, to (2) 
property as-designed with commitments to stated energy conservation 
programs without the use of renewables and (3) property as-designed 
with commitments to stated energy conservation programs and the use of 
proposed renewables. Use local average metrics for weather and utility 
costs and detail savings in kWh and dollars. Provide payback 
calculations. These calculations must be done by a licensed engineer or 
credentialed renewable energy provider. Include with the application, 
the provider/engineer's credentials including qualifications, 
recommendations, and proof of previous work. The checklist, affidavit, 
calculations, and qualifications of the engineer/energy provider must 
be submitted together with the pre-application.
    Enrollment in EPA Portfolio Manager Program. All projects awarded 
scoring points for energy initiatives must enroll the project in the 
EPA Portfolio Manager program to track post-construction energy 
consumption data. More information about this program may be found at: 
http://www.energystar.gov/buildings/facility-owners-and-managers/existing-buildings/use-portfolio-manager.
    (i) Energy Conservation for New Construction. Projects may be 
eligible for scoring points when the pre-application includes a written

[[Page 7848]]

certification by the applicant to participate and achieve certification 
in the following energy efficiency programs.
    The points will be allocated as follows:
     Participation in the EPA's Energy Star Multifamily New 
Construction Certification Process (5 points). https://www.energystar.gov/partner_resources/residential_new/homes_prog_reqs/multifamily_national_page
OR
     Participation in the Green Communities program by the 
Enterprise Community Partners (2020 Criteria). (7 points) https://www.enterprisecommunity.org/solutions-and-innovation/green-communities
OR
     Participation in one of the following two programs will be 
awarded points for certification.
    Note: Each program has four levels of certification. State the 
level of certification that the applicant's plans will achieve in their 
certification:
     LEED Residential BD&C program by the United States Green 
Building Council (USGBC): http://www.usgbc.org.--Certified Level (6 
points), OR--Silver Level (7 points), OR--Gold Level (8 points), OR--
Platinum Level (9 points)
    The applicant must state the level of certification that the 
applicant's plans will achieve in their certification in the pre-
application.

OR
     The National Association of Home Builders (NAHB) 2020 ICC 
700 National Green Building Standard: https://www.nahb.org/

--Green-Bronze Level (6 points), OR
--Silver Level (7 points), OR--Gold Level (8 points), OR--Emerald Level 
(9 points). Applicant must state the level of certification that the 
applicant's plans will achieve in their certification in the pre-
application.

OR
     Participation in the DOE Zero Energy Ready Homes program. 
(9 points) https://www.energy.gov/eere/buildings/zero-energy-ready-homes
OR
     PHIUS+ Passive Building Standard (2018) (10 points) 
https://multifamily.phius.org/service-category/phius-within-reach
OR
     International Living Future Institute Living Building 
Challenge (11 points) https://living-future.org/lbc/
AND
     Participation in local green/energy efficient building 
standards. Applicants who participate in a city, county or municipality 
programs (1 points).
    (ii) Energy Generation. Projects that commit to participate in the 
above-mentioned programs in section i) also will receive scoring points 
for installation of on-site renewable energy sources. Energy analysis 
of preliminary building plans using industry-recognized simulation 
software must document the projected total energy consumption of all 
the building components and building site usage. Projects with an 
energy analysis of the preliminary or rehabilitation building plans 
that propose a 10 percent to 100 percent energy generation commitment 
(where generation is considered to be the total amount of energy needed 
to be generated on-site to get the building a net-zero or net positive 
consumer/producer of energy) will be awarded points as follows:

 0 to 9 percent commitment to energy generation--0 points
 10 to 20 percent commitment to energy generation--1 point
 21 to 40 percent commitment to energy generation--2 points
 41 to 60 percent commitment to energy generation--3 points
 61 to 80 percent commitment to energy generation--4 points
 81 to 100 percent or more commitment to energy generation--5 
points

    Projects may participate in Power Purchase Agreements or Solar 
Leases to achieve their on-site renewable energy generation goals 
provided that the financial obligations of the lease/purchase 
agreements are clearly documented and included in the pre-application, 
and qualifying ratios continue to be achieved.
    An additional one point (1 point) will be awarded for off-grid 
systems, or elements of systems, provided that at least five percent of 
the on-site renewable system is off-grid. See www.dsireusa.org for 
State and local specific incentives and regulations of energy 
initiatives.
    (iii) Water Conservation in Irrigation Measures. Projects may be 
awarded one point (1 point) for the use of an engineered recycled water 
(gray water or storm water) for landscape irrigation covering 50 
percent or more of the property's site landscaping needs.
    (iv) Property Management Credentials. Projects may be awarded one 
point (1 point) if the designated property management company or 
individuals that will assume maintenance and operation responsibilities 
upon completion of construction work have a Credential for Green 
Property Management. Credentialing can be obtained from the National 
Apartment Association (NAA), National Affordable Housing Management 
Association, The Institute for Real Estate Management, USGBC LEED for 
Operations and Maintenance, or another source with a certifiable 
credentialing program. Credentialing must be illustrated in the 
resume(s) of the property management team and included with the pre-
application.
    (6) Market. The applicant must provide the required market study as 
described above in Section C, Pre-application and Submission 
Information, number 11 and will be awarded points as follows:
    Need. Applications will be rated on the absorption ratio. The 
absorption ratio is computed by dividing the number of units in the 
proposed project by the number of income eligible and farm labor 
eligible households within the primary market area.
     Evidence of Strong Need (4 points). An absorption ratio of 
15 percent or less.
     Evidence of Need (2 points). An absorption ratio greater 
than 15 percent and less than 30 percent.
     No Evidence of Need (0 points). An absorption ratio 30 
percent or greater.
    Neighborhood and Context. Applicants must demonstrate that the 
location of the site supports farm labor housing. The applicant must 
identify the location, the proximity, and ease of access of the project 
site to amenities important to the residents that supplement the 
services provided on-site. The site location will be rated on the 
following:
     Health care and social services (hospital, medical clinic, 
social service organization that offers services to farm workers) (2 
points);
     Grocery stores (e.g., supermarket or other store that 
sells produce and meat) (2 points);
     Recreational facilities (e.g., parks and green space, 
community center, gym, health club, or family entertainment venue, 
library) (2 points);
     Civic facilities (e.g., place of worship, police or fire 
station, post office) (2 points);
     Other neighborhood-serving amenities (e.g., apparel store, 
convenience store, pharmacy, bank, hair care, and restaurants) (2 
points).
    Applicants must describe how residents could reasonably access 
critical amenities. Amenities will generally be considered readily 
available if they are within one-half mile walking distance or they can 
be accessed by public transportation (within one-quarter walking mile)

[[Page 7849]]

including accessible public transportation option, and/or affordable 
private door-to-door shuttle/van service that is reliable and 
accessible. Applicants may commit to providing such transportation 
services if the nature of the commitment and the financing of the 
commitment is adequately described. Project funds cannot be used for 
this purpose.
    To score the maximum number of points on this factor, applicants 
must make a compelling argument that the location of the proposed 
project is well suited with respect to proximate amenities to meet the 
needs of farm workers. Documentation must be provided that clearly 
outlines the project site and its proximity to the applicable 
amenities.
    (7) Owner capacity. This factor addresses the extent to which the 
applicant, or a member of the applicant's team, has the experience and 
organizational resources to successfully implement the proposed 
activities in a timely manner. In this rating factor, RHS will consider 
the extent to which the application demonstrates the applicant's 
ability to develop and operate FLH on a long-term basis. In the case of 
co-sponsored applications, the rating will be based upon the 
combination of the experience of all co-sponsors in the area under 
review.
    A firm resume must be provided for the applicant and all Sponsors/
Co-Sponsors. Each resume must include evidence of development 
experience and services experience, as applicable. In addition, the 
resume should include a description of all similar projects that the 
applicant and Sponsors/Co-Sponsors have been involved with, to include 
whether they were Federal housing projects, and information regarding 
the success of the projects.
    Development Experience. Applicants should demonstrate how the 
scope, extent, and quality of the Sponsor's and/or their consultant 
team's recent experience in developing and operating housing is 
consistent with the details of the proposed project. The evaluation 
will consider experience with LIHTC, FLH with RHS funds, and other 
complex financing development transactions to the extent such expertise 
is relevant to the proposal, experience that shows familiarity with FLH 
and experience operating Federally assisted housing, which may be 
demonstrated by providing supporting data related to actual 
performance. The description or firm resumes must include any rental 
housing projects and supportive services facilities that the applicant 
sponsored, owns or operates.
    RHS will make a determination on the level of experience of the 
applicant and all Sponsors/Co-Sponsors, if applicable, based on the 
information and documentation presented within the pre-application. 
Points will be awarded as follows:

 No development experience (0 points)
 Low level of development experience (2 points)
 Medium level of development experience (5 points)
 High level of development experience (10 points)

    To score the highest number of points for this factor, applicants 
must describe significant previous experience in providing housing to 
farm laborer's generally and significant previous experience 
implementing development activities with the type of financing 
proposed.
    Supportive Services Experience. Applicants should demonstrate how 
the scope, extent, and quality of the applicant's experience and/or the 
experience of committed partners, including property managers, in 
providing services is consistent with the details of the proposed 
supportive services plan. The description and firm resumes must 
identify specific services provided. Applicants must explain their 
experience in RHS subsidy administration and/or their partners' 
experience in providing property management and coordinating supportive 
services.
    RHS will make a determination on the level of experience of the 
applicant and all Sponsors/Co-Sponsors, if applicable, based on the 
information and documentation presented within the pre-application. 
Points will be awarded as follows:

 No supportive services experience (0 points)
 Low level of supportive services experience (1 point)
 Medium level of supportive services experience (3 points)
 High level of supportive services experience (6 points)

    To score the highest number of points for this factor, applicants 
and/or committed partners must describe and provide evidence of 
significant previous experience in providing and coordinating 
supportive services to farm laborers.

E. Federal Award Administration Information

1. Federal Award Notices

    Applicants must submit their pre-applications by the due dates 
specified in this Notice. RHS will rank by score, highest to lowest, 
eligible and complete pre-applications. Based on available funding, the 
10 percent persistent poverty counties set-aside, and the 30 percent 
limitation per state, RHS will determine which pre-applications will be 
selected for further processing starting with the highest scoring pre-
application. RHS will notify applicants with pre-applications found 
eligible and selected for further processing.
    Applicants will be notified if there are insufficient funds 
available for the proposal and such notification is not appealable. For 
applications found ineligible or incomplete, RHS will send notices of 
ineligibility that provide appeal rights under 7 CFR part 11, as 
appropriate.
    RHS will rank all pre-applications nationwide. When proposals have 
an equal score and not all pre-applications can be funded, preference 
will be given first to Indian tribes as defined in Sec.  3560.11, then 
local non-profit organizations or public bodies whose principal 
purposes include low-income housing that meet the conditions of Sec.  
3560.55(c), and the following conditions:
     Is exempt from Federal income taxes under section 
501(c)(3) or 501(c)(4) of the Internal Revenue Service code;
     Is not wholly or partially owned or controlled by a for-
profit or limited-profit type entity;
     Whose members, or the entity, do not share an identity of 
interest with a for-profit or limited-profit type entity;
     Is not co-venturing with another entity; and
     The entity or its members will not be receiving any direct 
or indirect benefits pursuant to LIHTC.
    If after all of the above evaluations are completed and there are 
two or more pre-applications that have the same score, and all cannot 
be funded, a lottery will be used to break the tie. The lottery will 
consist of the names of each pre-application with equal scores printed 
onto a same size piece of paper, which will then be placed into a 
receptacle that fully obstructs the view of the names. The Director of 
the Production and Preservation Division, in the presence of two 
witnesses, will draw a piece of paper from the receptacle. The name on 
the piece of paper drawn will be the applicant to be funded.
    If insufficient funds or RA/OA remain for the next ranked proposal, 
that applicant will be given a chance to modify their pre-application 
to bring it within the remaining available funding. This will be 
repeated for each next

[[Page 7850]]

ranked eligible proposal until an award can be made or the list is 
exhausted.

2. Administrative and National Policy

    All FLH loans and grants are subject to the restrictive-use 
requirements contained in 7 CFR 3560.72(a)(2).
    A FLH grant agreement, prepared by RHS, must be dated and executed 
by the applicant on the date of closing, if applicable. The form of 
loan resolution to be adopted by the applicant must contain policy and 
procedural requirements that should be read and be fully understood by 
the applicant's Board of Directors and officers. The grant agreement 
will remain in effect for so long as there is a need for FLH and will 
not expire until an official determination has been made by RHS, if 
applicable.

3. Reporting

    Borrowers must maintain separate financial records for the 
operation and maintenance of the project and for tenant services. 
Tenant services will not be funded by RHS. Funds allocated to the 
operation and maintenance of the project may not be used to supplement 
the cost of tenant services, nor may tenant service funds be used to 
supplement the project operation and maintenance. Detailed financial 
reports regarding tenant services will not be required unless 
specifically requested by RHS, and then only to the extent necessary 
for RHS and the borrower to discuss the affordability (and 
competitiveness) of the service provided to the tenant. The project 
audit, or verification of accounts on Form RD 3560-10, ``Borrower 
Balance Sheet'' together with an accompanying Form RD 3560-7, 
``Multiple Family Housing Project Budget/Utility Allowance'' must 
allocate revenue and expenses between project operations and the tenant 
services component.

F. Preliminary Eligibility Assessment

    RHS shall make a preliminary eligibility assessment using the 
following criteria:
    1. The pre-application was received by the applicable submission 
deadlines specified in the Notice;
    2. The pre-application is complete as specified by the Notice;
    3. The applicant is an eligible entity and is not currently 
debarred, suspended, or delinquent on any Federal debt; and
    4. The proposal is for authorized purposes.

G. Final Application and Submission Information

1. Final Application Submission

    The pre-applications that are selected for further processing will 
be invited to submit final applications. In the event that a pre-
application is selected for further processing and the applicant 
declines, the next highest ranked pre-application will be selected for 
further processing in each individual fiscal year that this Notice is 
open. The final applications will be due by the dates specified in this 
Notice for the applicable funding round.
    All final applications must be filed with RHS and must meet the 
requirements of this Notice. Incomplete final applications will be 
rejected and returned to the applicant. No final applications will be 
accepted after the deadline in a given round unless the date and time 
are extended by another Notice published in the Federal Register.
    A final application in accordance with this Notice must be 
submitted and approved by RHS prior to the obligation of funds.
    The final application submission process will be the same as 
previously explained and outlined for the pre-application submission 
process in Section C (1), ``Pre-Application and Submission 
Information.''

2. Final Application Requirements

    (a) The final application must contain the following in addition to 
the pre-application documents that were previously submitted:
    (1) Description of any changes from the pre-application submission 
including funding, scope of work, etc.
    (2) If any document that was submitted within the pre-application 
has since changed or needs to be updated with the final application, 
please submit the updated form(s) with the final application.
    (3) Final Standard Form 424, ``Application for Federal 
Assistance.''
    (4) Final proposed Form RD 1924-13, ``Estimate and Certificate of 
Actual Cost.''
    (5) Final proposed post-construction operating budget utilizing 
Form RD 3560-7, ``Multiple Family Housing Project Budget/Utility 
Allowance.''
    (6) Updated financial statements, if applicable (must be within six 
months of this Notice's final application submission due date of the 
applicable funding round).
    (7) Form RD 1910-11, ``Applicant Certification, Federal Collection 
Policies for Consumer or Commercial Debts'' can be found at: https://forms.sc.egov.usda.gov//efcommon/eFileServices/eForms/RD1910-11.PDF.
    (8) Form RD 400-1, ``Equal Opportunity Agreement'' can be found at: 
https://forms.sc.egov.usda.gov/eForms/searchAction.do?pageAction=BrowseForms&_MenuAction=Yes.
    (9) Form RD 400-6, ``Compliance Statement'' can be found at: 
https://forms.sc.egov.usda.gov/eForms/searchAction.do?pageAction=BrowseForms&_MenuAction=Yes.
    (10) Form AD-1047, ``Certification Regarding Debarment, Suspension, 
and Other Responsibility Matters Primary Covered Transactions,'' can be 
found at: https://www.ocio.usda.gov/sites/default/files/docs/2012/AD1047_PrimaryCoveredTransactions_final.pdf. This form is only required 
for applicants exempt under 2 CFR 25.110 (i.e. individual applicants).
    (11) Form AD-1048, ``Certification of Debarment, Suspension, 
Ineligibility and Voluntary Exclusion Lower Tier Covered Transactions'' 
if applicable, can be found at: https://www.ocio.usda.gov/sites/default/files/docs/2012/AD1048_LowerTierCoveredTransactions_final.pdf. 
This form is only required for applicants exempt under 2 CFR 25.110 
(i.e. individual applicants).
    (12) Form AD-1049, ``Certification Regarding Drug-Free Workplace 
Requirements (Grants) Alternative I--For Grantees Other Than 
Individuals,'' can be found at: https://www.ocio.usda.gov/sites/default/files/docs/2012/AD1049_Alt1_GranteesOtherThanIndividuals_v2_final.pdf.
    (13) Form RD 3560-13, ``Multi-Family Project Borrower's/Management 
Agent's Management Certification'' if applicable, can be found at: 
https://forms.sc.egov.usda.gov//efcommon/eFileServices/eForms/RD3560-13.PDF.
    (14) Management plan with all attachments including the proposed 
record keeping system, the proposed lease with an attorney's 
certification, if applicable, and the proposed occupancy rules.
    (15) Management Agreement, if applicable.
    (16) Final organizational documents or Certificate of Good 
Standing.
    (17) Attorney Certification. Letter from the applicant's attorney 
certifying the legal sufficiency of the organizational documents. The 
attorney must certify:
    (i) The applicant's legal capacity to successfully operate the 
proposed project for the life of the loan and/or grant.
    (ii) The organizational documents comply with RHS regulations.

[[Page 7851]]

    (iii) For partnership purchasers, that the term of the partnership 
extends at least through the latest maturity of all proposed RHS debt.
    (iv) That the organizational documents require prior written RHS 
approval for any of the following: Withdrawal of a general partner/
managing member, admission of a general partner/managing member, 
amending the organizational documents, and selling all or substantially 
all of the assets of the purchaser.
    (18) Acceptable appraisal. Applicants should contact RHS to discuss 
the appraisal requirements including the Statement of Work (SOW) prior 
to engaging an appraiser. Appraisals prepared for any other 
participants or lenders may not satisfy RHS SOW requirements and may 
require the applicant to incur additional costs. Please contact RHS at 
[email protected] to obtain a SOW prior to ordering the 
appraisal.
    (19) An acceptable Post Construction Capital Needs Assessment 
(CNA). The minimum requirements for a CNA acceptable to RHS can be 
found in Attachment B, CNA SOW. This is supplemented by Attachment C, 
Fannie Mae Physical Needs Assessment Guidance to the Property 
Evaluator. The CNA report must be obtained by the CNA recipient from an 
independent third-party CNA provider that has no identity of interest 
with the property owner, management agent, applicant or any other 
principle or affiliate. The CNA recipient will contract with the CNA 
provider and is therefore, the client of the provider. However, the CNA 
recipient must consult with RHS, before contracting with a CNA provider 
to review Guidance Regarding Contracting for a CNA. The RHS CNA 
reviewer will evaluate a proposed agreement or engagement letter 
between the CNA recipient and the CNA provider using Attachment D, CNA 
Guidance to the Reviewer, prior to reviewing any CNA report. 
Unacceptable CNA proposals, contracts or reports will be returned to 
the CNA recipient for appropriate corrections before they will be used 
for any underwriting determinations. The CNA reviewer will also review 
the cost of the CNA contract. In most cases, the CNA service contract 
amount has not exceeded $3,500 based on RHS's most recent cost 
analysis. Borrowers and applicants are encouraged to obtain multiple 
bids in all cases. However, there is no RHS requirement to select the 
``low bidder.'' All of the information and requirements, including the 
CNA Template that the CNA must be submitted on, can be found at: 
https://www.rd.usda.gov/programs-services/multi-family-housing-direct-loans.
    (20) Final plans and specifications along with the proposed manner 
of construction, if available. The housing must meet RHS's design and 
construction standards contained in 7 CFR part 1924, subparts A and C, 
and must also meet all applicable Federal, state, and local 
accessibility standards and be in compliance with all building codes. 
The final plans and specifications along with the proposed manner of 
construction must be submitted prior to the approval of the final 
application.
    (21) Final construction planning, bidding, and contract documents, 
including the construction contract and architectural agreement, etc., 
if available. The final construction planning, bidding, and contract 
documents, including the construction contract and architectural 
agreement, etc., must be submitted prior to the approval of the final 
application.
    (22) Environmental information in accordance with the requirements 
in 7 CFR part 1970. The applicant should consult with RHS to determine 
the appropriate level of environmental review and to obtain publicly 
available resources at the earliest possible time for guidance in 
identifying all relevant environmental issues that must be addressed 
and considered during early project planning and design throughout the 
process. Requests for consult meetings can be sent to the following 
email address: [email protected]. The applicant is responsible 
for preparing and submitting the environmental review document in 
accordance with the format and standards provided by RHS in 7 CFR part 
1970. Applicants may employ a design or environmental professional or 
technical service provider to assist them in the preparation of their 
environmental review documents at their own expense. The levels of 
review are as follows:
    (i) Categorical Exclusion without an Environmental Report (7 CFR 
1970.53).
    This level of review is generally required for proposals for 
financial assistance that involve minimal alternations in the physical 
environment and typically occur on previously disturbed land.
    (ii) Categorical Exclusion with an Environmental Report (7 CFR 
1970.54).
    This level of review is generally required for proposals for 
financial assistance that require an applicant to submit an 
environmental report with their application to facilitate RHS's 
determination of extraordinary circumstances. This level of review 
would apply to proposals where site development activities for rural 
development purposes would impact not more than 10 acres of real 
property and would not cause a substantial increase in traffic.
    (iii) Environmental Assessment (7 CFR part 1970, subpart C).
    This level of review is generally required for proposals for 
financial assistance that do not fall within the categories listed in 
Sec.  1970.53 or Sec.  1970.54.
    The information above applies generally and cannot be used as 
official guidance, as stated above, please contact RHS to determine the 
appropriate level of environmental review before developing the report.
    (23) The environmental information must include evidence of 
compliance with the requirements of the applicable State Housing 
Preservation Office (SHPO), and/or Tribal Historic Preservation Officer 
(THPO). A letter from the SHPO and/or THPO where the Off-FLH project is 
located signed by their designee will serve as evidence of compliance.
    (24) If leveraged funds are going to be used and are in the form of 
LIHTC, the applicant must include in the final application a firm 
commitment letter from the HFA, if available. The firm commitment 
letter from the HFA must be submitted prior to the approval of the 
final application. If the applicant is unable to secure a firm 
commitment letter from the HFA in order to submit it to RHS to meet the 
deadlines stated in this Notice, the application will be deemed 
incomplete and the applicant will be notified in writing that the 
application will not be considered for funding. Additionally, the 
applicant will be required to submit a letter of intent or commitment 
from the investor or syndicator for the purchase of the LIHTC prior to 
the approval of the final application.
    (25) All applications that propose the use of any leveraged funds 
must submit firm commitment letters within their final application, if 
available. This includes any interim lender commitment letters with 
evidence of license to do business in the applicable state. If the 
applicant is unable to secure firm commitment letters from the funding 
sources in order to submit them to RHS to meet the deadlines stated in 
this Notice, the application will be deemed incomplete and the 
applicant will be notified in writing that the application will not be 
considered for funding.
    (26) Current Preliminary title insurance commitment/binder.

[[Page 7852]]

    (27) Land survey with flood plain certification.
    (28) Description of how the applicant will meet the equity 
contribution requirement as applicable.
    (29) Description of how the applicant will provide the two percent 
initial operating and maintenance reserve requirement.
    (30) Signed statement from the applicant agreeing to pay cost 
overruns.
Final Applications
    RHS will follow this Notice for the processing of final 
applications. Final applications will need to follow the bidding 
process as set forth in 7 CFR part 1924.
Documentation of Underwriting and Costs
    All final applications including the loan and/or grant requests 
will be analyzed using an underwriting template that RHS has developed. 
A complete analysis and underwriting of the proposed transaction will 
be completed to ensure all regulatory requirements are met and to 
ensure overall project feasibility as well as to determine the minimum 
amount of assistance that is needed for the proposal.
    Once the loan and/or grant funds have been obligated, the applicant 
should be prepared to close the transaction and complete construction 
within 12-18 months. Off-FLH loans and/or grants must be liquidated not 
more than three years from the date the loan and/or grant funds were 
obligated. Annually, if the loan and/or grant funds have not been fully 
liquidated, the applicant must submit an obligation extension request 
to RHS.
    Questions regarding this Notice may be directed to Jonathan Bell, 
Branch Chief, Processing and Report Review Branch 1, Production and 
Preservation Division, Multifamily Housing Program, Rural Development, 
United States Department of Agriculture, or email: 
[email protected] or phone at: 254-742-9764.
Technical Assistance Providers
    Please be aware that TA services may not be used to reimburse a 
non-profit or public body applicant for technical services provided by 
a non-profit organization, with housing and/or community development 
experience, to assist the non-profit applicant entity in the 
development and packaging of its loan/grant docket and project. In 
addition, TA will not be funded by RHS when an identity of interest 
exists between the TA provider and the loan or grant applicant. 
Identity of interest is defined in 7 CFR 3560.11.
Equal Opportunity Survey
    RHS should provide applicants the voluntary OMB 1890-0014 form, 
``Survey on Ensuring Equal Opportunity for Applicants,'' (or other 
forms currently being used by RHS) and ask the applicant to complete it 
and return it to RHS.
Substantial Portion of Income From Farm Labor
    The Notice restates the requirement that domestic farm laborers 
must receive a substantial portion of their income from ``farm labor.'' 
Further explanation of this requirement can be found in the regulation 
at 7 CFR 3560.576(b)(2). The term ``farm labor'' is defined in 7 CFR 
3560.11.

H. Equal Opportunity and Non-Discrimination Requirements

    In accordance with federal civil rights law and USDA civil rights 
regulations and policies, USDA, its Agencies, offices, and employees, 
and institutions participating in or administering USDA programs are 
prohibited from discriminating 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 a complaint 
form, call, (866) 632-9992. Submit your completed form or letter to 
USDA by:
    (1) Mail: United States 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 at: [email protected].
    USDA is an equal opportunity provider, employer, and lender.

Chadwick Parker,
Acting Administrator, Rural Housing Service.
[FR Doc. 2021-02193 Filed 2-1-21; 8:45 am]
BILLING CODE 3410-XV-P