Proposed Rule2024-19807
Adoption of 2020 Core Based Statistical Area Standards
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 6, 2024
Issuing agencies
Housing and Urban Development Department
Abstract
This proposed rule would adopt the 2020 Core Based Statistical Area (CBSA) standards as determined by the Office of Management and Budget (OMB). The Metropolitan Areas Protection and Standardization Act of 2021 (MAPS Act) requires agencies that propagate OMB's CBSA Standards for non-statistical use to seek public comment before determining that the propagation supports the purposes of the agency's programs and is in the public interest. This proposed rule describes HUD's use of CBSAs, how CBSA standards support relevant programs, and how HUD believes the adoption of updated standards ensures accuracy of data and program administration.
Full Text
<html>
<head>
<title>Federal Register, Volume 89 Issue 173 (Friday, September 6, 2024)</title>
</head>
<body><pre>
[Federal Register Volume 89, Number 173 (Friday, September 6, 2024)]
[Proposed Rules]
[Pages 72766-72769]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-19807]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 5
[Docket No. FR-6464-P-01]
RIN 2501-AE11
Adoption of 2020 Core Based Statistical Area Standards
AGENCY: Office of the Secretary, U.S. Department of Housing and Urban
Development (HUD).
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: This proposed rule would adopt the 2020 Core Based Statistical
Area (CBSA) standards as determined by the Office of Management and
Budget (OMB). The Metropolitan Areas Protection and Standardization Act
of 2021 (MAPS Act) requires agencies that propagate OMB's CBSA
Standards for non-statistical use to seek public comment before
determining that the propagation supports the purposes of the agency's
programs and is in the public interest. This proposed rule describes
HUD's use of CBSAs, how CBSA standards support relevant programs, and
how HUD believes the adoption of updated standards ensures accuracy of
data and program administration.
DATES: Comments are due by: November 5, 2024.
ADDRESSES: There are two methods for submitting public comments. All
submissions must refer to the above docket number and title.
1. Electronic Submission of Comments. Comments may be submitted
electronically through the Federal eRulemaking Portal at
<a href="http://www.regulations.gov">www.regulations.gov</a>. HUD strongly encourages commenters to submit
comments electronically. Electronic submission of comments allows the
commenter maximum time to prepare and submit a comment, ensures timely
receipt by HUD, and enables HUD to make comments immediately available
to the public. Comments submitted electronically through
<a href="http://www.regulations.gov">www.regulations.gov</a> can be viewed by other commenters and interested
members of the public. Commenters should follow the instructions
provided on that website to submit comments electronically.
2. Submission of Comments by Mail. Comments may be submitted by
mail to the Regulations Division, Office of General Counsel, Department
of Housing and Urban Development, 451 7th Street SW, Room 10276,
Washington, DC 20410-0500.
[[Page 72767]]
Note: To receive consideration as public comments, comments must
be submitted through one of the two methods specified above. Again,
all submissions must refer to the docket number and title of the
rule.
No Facsimile Comments. Facsimile (FAX) comments are not acceptable.
Public Inspection of Public Comments. All comments and
communications properly submitted to HUD will be available for public
inspection and copying between 8 a.m. and 5 p.m. weekdays at the above
address. Due to security measures at the HUD Headquarters building, an
advance appointment to review the public comments must be scheduled by
calling the Regulations Division at (202) 708-3055 (this is not a toll-
free number). HUD welcomes and is prepared to receive calls from
individuals who are deaf or hard of hearing, as well as from
individuals with speech or communication disabilities. To learn more
about how to make an accessible telephone call, please visit <a href="https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs">https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs</a>. In
accordance with 5 U.S.C. 553(b)(4), a summary of this proposed rule may
be found at <a href="http://www.regulations.gov">www.regulations.gov</a>.
FOR FURTHER INFORMATION CONTACT: Kurt Usowski, Deputy Assistant
Secretary for Economic Affairs, Office of Policy Development and
Research, Department of Housing and Urban Development, 451 7th St. SW,
Washington, DC 20410, telephone number 202-402-5899 (this is not a
toll-free number) or via email to <a href="/cdn-cgi/l/email-protection#4a013f383e640d641f39253d3921230a223f2e642d253c"><span class="__cf_email__" data-cfemail="b6fdc3c4c298f198e3c5d9c1c5dddff6dec3d298d1d9c0">[email protected]</span></a>. HUD welcomes
and is prepared to receive calls from individuals who are deaf or hard
of hearing, as well as individuals with speech or communication
disabilities. To learn more about how to make an accessible telephone
call, please visit <a href="https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs">https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs</a>.
SUPPLEMENTARY INFORMATION:
I. Background: Core Based Statistical Areas
In its role as coordinator of the Federal statistical system, OMB
establishes and maintains the CBSA program. CBSAs are geographic areas
containing a large population nucleus, or urban area, and adjacent
communities that have a high degree of integration with that nucleus
measured by commuting ties. There are two types of CBSAs, the
Metropolitan Statistical Area (MSA) and the Micropolitan Statistical
Area. The classifications provide a nationally consistent set of
delineations for collecting, tabulating, and publishing Federal
statistics for geographic areas. OMB maintains CBSAs solely for
statistical purposes. Every decade, OMB reviews and updates the
Standards for Delineating CBSAs (CBSA standards), which describe the
data sources and methods OMB uses to determine which geographic areas
are to be designated CBSAs, prior to their application to new decennial
census data. OMB updated CBSA standards on July 16, 2021 (86 FR 37770),
prior to applying them to 2020 Census data.
The Metropolitan Areas Protection and Standardization Act of 2021,
or the MAPS Act, (31 U.S.C. 6102, et seq.) prohibits agencies from
automatically propagating OMB's standards for non-statistical use by
any domestic assistance program unless the agency determines that the
propagation: (1) supports the purpose of the program; and (2) is in the
public interest. (31 U.S.C. 6309(a)(2)(A)) Propagation of the standards
for non-statistical use by domestic assistance programs must be done
through a notice and comment rulemaking. (31 U.S.C. 6309(a)(2)(B))
HUD's Office of Community Planning and Development (CPD), Office of
Housing--Federal Housing Administration (FHA), and Office of Public and
Indian Housing (PIH) use CBSAs to administer their programs listed in
Table 1. The Office of Policy Development and Research (PD&R) also uses
CBSA definitions to calculate Fair Market Rents, Area Median Family
Income Estimates and Income Limits. This proposed rule describes, for
each of its affected programs, how HUD uses CBSA definitions, how the
use of new CBSA standards support the purposes of the programs, and
that the adoption of the new CBSAs in the operations of these programs
is in the public interest. HUD welcomes comments on all aspects of this
proposed rule.
Table 1--HUD Uses of CBSAs
------------------------------------------------------------------------
Use HUD Office
------------------------------------------------------------------------
Community Development Block Grant Program....... CPD.
Community Development Block Grant Disaster CPD.
Recovery Program.
Housing Opportunities for Persons with AIDS CPD.
Program.
HOME Investment Partnerships (HOME) Program..... CPD.
Housing Trust Fund (HTF) Program................ CPD.
Continuum of Care............................... CPD.
Emergency Solutions Grant (ESG)................. CPD.
FHA's Title II Program (loan limits)............ Housing.
Choice Neighborhoods Initiative................. PIH.
Difficult Development Area and Qualified Census PD&R.
Tract Designations.
Fair Market Rents, Area Median Family Income, PD&R.
and Income Limits.
------------------------------------------------------------------------
II. Use of CBSAs in HUD Programs
A. Fair Market Rents, Area Median Family Income, and Income Limits
HUD uses CBSAs to calculate Fair Market Rents (FMRs), HUD's Area
Median Family Income (HAMFI) estimates, and Income Limits (ILs). FMRs,
HAMFI, and ILs are addressed together because they incorporate MSA
definitions in substantially identical ways and the presence of
interacting calculations in the determination of these ``program
parameters.'' That is, FMRs, HAMFI estimates, and ILs share the same
geography in any given fiscal year. FMRs are an estimate of the amount
of money that would cover gross rents (rent and utility expenses) on 40
percent of the rental housing units in an area. FMRs are used in
several HUD programs, including determining the maximum amount a
Housing Choice Voucher will cover. ILs, which are derived from HAMFIs
(and in some cases, FMRs) set eligibility income levels for HUD
programs as well as various other federal programs and maximum rent
levels for housing supported by the Low-Income Housing Credit. From the
inception of FMRs, HUD has generally considered MSAs to be good proxies
for housing markets as they have been historically based on home-to-
work commuting interactions as the principal means of identifying
component geography to be combined.
[[Page 72768]]
HUD has always also made exceptions for MSAs where boundaries extended
beyond the actual housing market. Following the 2000 revisions that
created CBSAs, HUD began making far more exceptions to the use of OMB-
defined MSAs in FMRs to avoid large changes in FMR values due largely
to geographic definition changes of MSAs. Since the promulgation of
regulations mandating the use of ``Small Area FMRs'' estimated at the
ZIP-code level in selected FMR areas, HUD has largely stopped
incorporating new counties added to MSAs into FMR areas, instead
maintaining separate ``HUD Metro FMR Areas'' (HMFAs).
Currently, for computations of FMR estimates HUD uses the MSAs to
define which areas are in HUD Metro FMR Areas or defines the FMR area
as coterminous with the MSA as appropriate for the housing market. FMRs
are estimated separately for each county or county equivalent not in a
MSA, including those in Micropolitan CBSAs. HUD also uses MSA-level
data in the calculation of FMRs in HMFAs. See HUD's notice announcing
fiscal year (FY) 2024 FMRs for details on the use of MSA-level data at:
<a href="https://www.huduser.gov/portal/datasets/fmr/fmr2024/FMR_FY24_FinalNotice_2023.pdf">https://www.huduser.gov/portal/datasets/fmr/fmr2024/FMR_FY24_FinalNotice_2023.pdf</a> (88 FR 60223). HAMFIs and ILs are
estimated for the same areas as FMRs. Details on the relationship
between ILs and FMRs is available in the FY 2024 Income Limits
Methodology description at: <a href="https://www.huduser.gov/portal/datasets/il//il24/IncomeLimitsMethodology-FY24.pdf">https://www.huduser.gov/portal/datasets/il//il24/IncomeLimitsMethodology-FY24.pdf</a>.
B. Difficult Development Area and Qualified Census Tract Designations
HUD designates Difficult Development Areas (DDAs) and Qualified
Census Tracts (QCTs) for purposes of the Low-Income Housing Credit
(LIHTC) program. DDAs and QCTs derive from FMRs and ILs, but HUD also
uses CBSA definitions in counting the metropolitan population and
nonmetropolitan population for the DDAs, where designated populations
are restricted to 20 percent of the respective totals, and the full
population of metropolitan CBSAs for QCTs where the total population of
designated tracts in a metropolitan area or nonmetropolitan part of a
state cannot exceed 20 percent of total population of the respective
areas. (26 U.S.C. 42(d)(5)(B))
C. Additional PIH Use of CBSAs
PIH's Choice Neighborhoods Initiative program uses CBSA definitions
as part of its grant application process. In awarding Planning grants
and Implementation grants, MSAs are used to determine points earned for
the ``leverage'' rating factor. Points are different for applications
targeting a neighborhood in an MSA with a population greater than
500,000 versus 500,000 or less. CBSAs are also a factor used to
determine whether an applicant qualifies for an exception to the hard
unit one-for-one replacement requirement. If grantees want to locate
replacement housing outside their target neighborhood, they cannot
locate it in areas of minority concentration, which is defined using
CBSA delineations.
D. Additional CPD Use of CBSAs
CPD's Community Development Block Grant (CDBG) program uses OMB's
definition of ``Principal Cities'' of Metropolitan CBSAs to determine
which jurisdictions are eligible for metropolitan city status, as
defined at 24 CFR 570.3. Metropolitan cities are participating units of
general local government that are either principal cities, by OMB's
definition, or any other city in a metropolitan area with a population
of 50,000 or more. Other entitlement jurisdictions include ``urban
counties'' which are defined and may be determined eligible by one of
two ways as set forth in the Housing and Community Development Act of
1974, as amended (``HCDA'') (see 42 U.S.C. 5302(a)(6)). Either the
population of the urban county exceeds 200,000 after deducting the
population contained in any metropolitan city (cities), or part(s) of a
metropolitan city (cities), within the county, or the urban county
meets the low- and moderate-income preponderance test, in that it has a
total combined population of at least 100,000 (but fewer than 200,000)
in its unincorporated areas and included units of general local
government, and those areas (combined) include the majority of low- and
moderate-income persons in the county. The CDBG entitlement formula
uses as its denominator for five of the six variables the aggregated
data for all metropolitan areas (see 42 U.S.C. 5306). CDBG-eligible
low- and moderate-income areas and households are determined relative
to HUD's ILs.
CPD's CDBG-Disaster Recovery funds provides relief to rebuild
disaster-stricken areas and crucial seed money to start the long-term
recovery process. Funding is awarded to ``metropolitan areas'' and
``metropolitan cities'', among other recipients. Those geographic areas
are defined in the HCDA as being established by OMB, referring to
CBSAs. (42 U.S.C. 5302(a))
Additionally, CPD's Housing Opportunities for Persons With AIDS
(HOPWA) program awards funding to States and ``metropolitan statistical
areas'' to address the housing needs of low-income people living with
HIV/AIDS and their families. The statute for the program defines
``metropolitan statistical areas'' as metropolitan statistical areas
established by OMB and specifies that this includes the District of
Columbia (HOPWA, section 853(5) of the AIDS Housing Opportunity Act, 42
U.S.C. 12902(5)).
Finally, CDP's HOME, Continuum of Care, and ESG programs offer
grants to grantees in geographic areas based on the CDBG definitions
that are themselves based on CBSAs. These programs do not otherwise use
CBSAs in their grant allocation formulas. The HTF program uses formula
factors whose definitions are based upon CBSA-level data.
E. Office of Housing's Use of CBSAs
The Office of Housing uses CBSAs to establish the Title II loan and
mortgage limits. Loan limits are based on the county-level median home
price of the highest price county within the area, with ``area''
defined as the ``metropolitan statistical area as established by the
Office of Management and Budget'', referring to OMB's CBSA program.
(National Housing Act 203(b)(2) (12 U.S.C. 1709(b)(2))
III. Adoption of New CBSAs Standards Would Support Program Purposes and
be in the Public Interest
The new CBSA standards support FMRs, HAMFIs, and ILs. Because the
new CBSAs become the standards for Federal statistical entities and
private sector firms releasing data used in FMR calculations, adopting
the new standards in these calculations serves to promote the accuracy
of FMRs and makes their calculation more efficient. Whether a
particular county is a non-metropolitan FMR area or one-county HMFA
makes only a slight difference in the estimated value of the FMR but
may make it more accurate. HMFA designation means HUD applies
adjustments to the county-level data derived from the containing MSA
rather than the non-metropolitan part of the state. Similar adjustments
apply to ILs. Using new CBSA definitions improves the accuracy of HUD's
affected calculations. The accuracy of these program parameters is in
the public interest as it most appropriately will direct resources
governed by these parameters to recipients in the most appropriate
amounts.
[[Page 72769]]
The new CBSA standards support HUD's designation of DDAs and QTCs
as well as PIH, CPD, and Housing's programs because they more
accurately reflect the current housing markets, which have changed
significantly since the 2010 census. Furthermore, adopting the new
standards will not be disruptive to the programs as program
participants are expecting HUD to regularly update the metropolitan
area standards and definitions to reflect current market conditions as
HUD has done historically.
IV. This Proposed Rule
For the reasons stated above, this proposed rule would
affirmatively adopt new OMB CBSA Standards for purposes of estimating
Fair Market Rents, Area Median Family Incomes, and Income Limits, and
for other administrative purposes in PIH, CPD, and Housing programs.
This includes any future revisions to the CBSA delineations under these
standards.
HUD proposes to add a new subpart M to part 5 that will cross
reference all affected programs and adopt the updated CBSA standards
for such programs.
V. Findings and Certifications
Regulatory Review (Executive Orders 12866, 13563, and 14094)
This proposed rule would adopt updated standards for CBSA
delineations that HUD programs use for program administrative purposes.
It is statistical and administrative in nature with the purpose of
maintaining past administrative practices. This rule was not subject to
OMB review. This proposed rule is not a ``significant regulatory
action'' as defined in section 3(f) of Executive Order 12866 and is not
an economically significant regulatory action.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C.
1531-1538) (UMRA) establishes requirements for Federal agencies to
assess the effects of their regulatory actions on State, local, and
Tribal governments, and on the private sector. This proposed rule does
not impose any Federal mandates on any State, local, or Tribal
governments, or on the private sector, within the meaning of UMRA.
Environmental Review
This proposed rule establishes discretionary review of loan limits,
fair market rent schedules, income limits and exclusions with regard to
eligibility for or calculation of HUD housing assistance or rental
assistance, and similar rate and cost determinations and related
external administrative or fiscal requirements or procedures which do
not constitute a development decision that affects the physical
condition of specific project areas or building sites. Accordingly,
under 24 CFR 50.19(c)(6), this proposed rule is categorically excluded
from environmental review under the National Environmental Policy Act
of 1969 (42 U.S.C. 4321).
Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.)
generally requires an agency to conduct a regulatory flexibility
analysis of any rule subject to notice and comment rulemaking
requirements, unless the agency certifies that the rule will not have a
significant economic impact on a substantial number of small entities.
This proposed rule would adopt updated definitions of CBSA geographic
areas that affected HUD programs use for various administrative
purposes. The proposed adoption would be statistical and administrative
in nature and consistent with longstanding HUD policy and practice.
Therefore, the proposed action does not have a significant economic
impact on a substantial number of small entities.
Executive Order 13132, Federalism
Executive Order 13132 (Federalism) prohibits an agency from
publishing any rule that has federalism implications if the rule
either: (i) imposes substantial direct compliance costs on State and
local governments and is not required by statute, or (ii) preempts
State law, unless the agency meets the consultation and funding
requirements of section 6 of the Executive order. This proposed rule
does not have federalism implications and does not impose substantial
direct compliance costs on State and local governments or preempt State
law within the meaning of the Executive order.
List of Subjects in 24 CFR Part 5
Administrative practice and procedure, Aged, Claims, Crime,
Government contracts, Grant programs--housing and community
development, Individuals with disabilities, Intergovernmental
relations, Loan programs--housing and community development, Low and
moderate income housing, Mortgage insurance, Penalties, Pets, Public
housing, Rent subsidies, Reporting and recordkeeping requirements,
Social Security, Unemployment compensation, Wages.
Accordingly, for the reasons stated in the preamble, HUD proposes
to amend 24 CFR part 5 as follows:
PART 5--GENERAL HUD PROGRAM REQUIREMENTS; WAIVERS
0
1. The authority for part 5 continues to read as follows:
Authority: 12 U.S.C. 1701x; 42 U.S.C. 1437a, 1437c, 1437f,
1437n, 3535(d); 42 U.S.C. 2000bb et seq.; 34 U.S.C. 12471 et seq.;
Sec. 327, Pub. L. 109-115, 119 Stat. 2396; E.O. 13279, 67 FR 77141,
3 CFR, 2002 Comp., p. 258; E.O. 13559, 75 FR 71319, 3 CFR, 2010
Comp., p. 273; E.O. 14015, 86 FR 10007, 3 CFR, 2021 Comp., p. 517.
0
2. Add subpart M to read as follows:
Subpart M--Core Based Statistical Areas
Sec. 5.3001 Automatic propagation of OMB's Core Based Statistical
Area Standards.
When using Core Based Statistical Areas (CBSAs), HUD shall use the
2020 CBSA standards adopted by the Office of Management and Budget on
July 16, 2021, through publication in the Federal Register as well as
any subsequent updates to the CBSA delineations based on these
standards made by the Office of Management and Budget. Purposes and
programs that use the CBSA standards include, but are not limited to:
(a) The Community Development Block Grant Program (24 CFR part
570);
(b) The Community Development Block Grant Disaster Recovery funds
(applicable appropriations and Federal Register notices);
(c) The Housing Opportunities for Persons with AIDS Program (24 CFR
part 574);
(d) The HOME Investment Partnerships Program (24 CFR part 92);
(e) The Continuum of Care Program (24 CFR part 578);
(f) The Emergency Solutions Grants Program (24 CFR part 576);
(e) The FHA Title II Program (National Housing Act of 1934 Title
II);
(f) The Choice Neighborhoods Initiative Program (42 U.S.C. 1437v,
as applied by the applicable annual appropriations act(s); 24 CFR
905.602(d);
(g) The Housing Trust Fund Program (24 CFR part 93); and
(h) The calculation of: Fair Market Rents (24 CFR part 888); Area
Median Family Income (this part); Income Limits (this part); Difficult
Development Areas; and Qualified Census Tracts.
Todd Richardson,
General Deputy Assistant Secretary, Policy Development and Research.
[FR Doc. 2024-19807 Filed 9-5-24; 8:45 am]
BILLING CODE 4210-67-P
</pre><script data-cfasync="false" src="/cdn-cgi/scripts/5c5dd728/cloudflare-static/email-decode.min.js"></script></body>
</html>Indexed from Federal Register on September 6, 2024.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.