Proposed Rule2024-28032
Self-Help Technical Assistance Grants: Technical Corrections and Program Updates
Primary source
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Published
December 4, 2024
Issuing agencies
Agriculture DepartmentRural Housing Service
Abstract
The Rural Housing Service (RHS or the Agency), a Rural Development (RD) agency of the United States Department of Agriculture (USDA), proposes to update and streamline the Single-Family Housing (SFH) Self-Help Technical Assistance Grant Program. The Self-Help Program has evolved, and the current regulations as codified restrict the Agency's ability to be flexible with market changes. The intent of this proposed rule is to reduce the regulatory burdens in the current regulation, to assist the Agency to better achieve the program objectives, streamline administrative regulatory requirements and make the program more effective in serving rural Americans by increasing decent, safe, and sanitary housing stock across the Nation.
Full Text
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<title>Federal Register, Volume 89 Issue 233 (Wednesday, December 4, 2024)</title>
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[Federal Register Volume 89, Number 233 (Wednesday, December 4, 2024)]
[Proposed Rules]
[Pages 96130-96143]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-28032]
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DEPARTMENT OF AGRICULTURE
Rural Housing Service
7 CFR Part 1944
[Docket No. RHS-24-SFH-0037]
RIN 0575-AD37
Self-Help Technical Assistance Grants: Technical Corrections and
Program Updates
AGENCY: Rural Housing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: The Rural Housing Service (RHS or the Agency), a Rural
Development (RD) agency of the United States Department of Agriculture
(USDA), proposes to update and streamline the Single-Family Housing
(SFH) Self-Help Technical Assistance Grant Program. The Self-Help
Program has evolved, and the current regulations as codified restrict
the Agency's ability to be flexible with market changes. The intent of
this proposed rule is to reduce the regulatory burdens in the current
regulation, to assist the Agency to better achieve the program
objectives, streamline administrative regulatory requirements and make
the program more effective in serving rural Americans by increasing
decent, safe, and sanitary housing stock across the Nation.
DATES: Comments on the proposed rule must be received on or before
February 3, 2025.
The comment period for the information collection under the
Paperwork Act of 1995 must be received on or before February 3, 2025.
ADDRESSES: Comments may be submitted electronically by the Federal
eRulemaking Portal: Go to <a href="http://www.regulations.gov">http://www.regulations.gov</a> and, in the
``Search Field'' box, labeled ``Search for dockets and documents on
agency actions,'' enter the following docket number: (RHS-24-SFH-0037)
or Regulation Identifier Number (RIN): (0575-AD37). To submit or view
public comments, click the ``Search'' button, select the ``Documents''
tab, then select the following document title: ``Self-Help Technical
Assistance Grants: Technical Corrections and Program Updates'' from the
``Search Results,'' and select the ``Comment'' button. Before inputting
your comments, you may also review the ``Commenter's Checklist''
(optional). Insert your comments under the ``Comment'' title, click
``Browse'' to attach files (if available). Input your email address and
select ``Submit Comment.'' Information on using <a href="http://Regulations.gov">Regulations.gov</a>,
including instructions for accessing documents, submitting comments,
and viewing the docket after the close of the comment period, is
available through the site's ``FAQ'' link.
All comments will be available for public inspection online at the
Federal eRulemaking Portal (<a href="http://www.regulations.gov">http://www.regulations.gov</a>).
Other Information: Additional information about Rural Development
and its programs is available on the internet at <a href="http://www.rurdev.usda.gov/index.html">http://www.rurdev.usda.gov/index.html</a>.
In accordance with 5 U.S.C. 553(b)(4), a summary of this proposed
rule may be found by going to <a href="http://www.regulations.gov">http://www.regulations.gov</a> and in the
``Search for dockets and documents on agency actions'' box, enter the
following docket number RHS-24-SFH-0037.
FOR FURTHER INFORMATION CONTACT: Sunceri Dade, Finance & Loan Analyst,
SFH Direct Division, Rural Housing Service, Rural Development, United
States Department of Agriculture, 1400 Independence Avenue SW,
Washington, DC 20250, Phone: 202-720-1485, Email:
<a href="/cdn-cgi/l/email-protection#4310362d2026312a6d0722272603363027226d242c35"><span class="__cf_email__" data-cfemail="5003253e333522397e1431343510252334317e373f26">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
Statutory Authority
Section 510(k) of Title V the Housing Act of 1949 [42 U.S.C.
1480(k)], as amended, authorizes the Secretary of the Department of
Agriculture to promulgate rules and regulations as deemed necessary to
carry out the purpose of that title. The Self-Help program is
authorized under Section 523 of Title V the Housing Act of 1949 (42
U.S.C. 1490(c)), as amended, authorizes the Secretary of the Department
of Agriculture to promulgate rules and regulations as deemed necessary
to carry out the purpose of that title. The program is implemented
under 7 CFR part 1944, subpart I.
I. Background
The RHS offers a variety of programs to build or improve housing
and essential community facilities in rural areas. RHS offers loans,
grants, and loan guarantees for single- and multifamily housing,
childcare centers, fire and police stations, hospitals, libraries,
nursing homes, schools, first responder vehicles and equipment, housing
for farm laborers. RHS also provides technical assistance loans and
grants in partnership with non-profit organizations, Indian Tribes,
state and federal government agencies, and local communities.
Well built, affordable housing is essential to the vitality of
communities in rural America. RD SFH Programs give families and
individuals the opportunity to buy, build, or repair affordable homes
located in rural America. Eligibility for these loans, loan guarantees,
and grants is based on income and varies according to the average
median income for each area.
Section 510(k) of Title V the Housing Act of 1949 [42 U.S.C.
1480(k)], as amended, authorizes the Secretary of the Department of
Agriculture to promulgate rules and regulations as deemed necessary to
carry out the purpose of that title. The Self-Help program is
authorized under Section 523 of Title V the Housing Act of 1949 (42
U.S.C. 1490(c)), as amended, authorizes the Secretary of the Department
of Agriculture to promulgate rules and regulations as deemed necessary
to carry out the purpose of that title. The RHS administers the Section
523 Self-Help Housing Technical Assistance Grant Program which is
implemented under 7 CFR 1944, Subpart I and authorized by the Housing
Act of 1949, as amended (42 U.S.C. 1490c). The purpose of the program
is to provide grants to qualified organizations to help them carry out
local self-help housing construction projects. Grant recipients
supervise groups of very low- and low-income individuals and families
as they construct or rehabilitate their homes in rural areas. The group
members provide most of the construction labor on each other's homes,
and rehabilitation project participants contribute construction hours
based on the amount of work
[[Page 96131]]
being completed, all with technical assistance from the organization
overseeing the project. Eligible applicants include government
nonprofit organizations, federally recognized Tribes, and private
nonprofit organizations.
The SFH program undertook a systematic review of its current
regulation at 7 CFR 1944 Subpart I and the procedures to administer its
programs. It was determined that several technical corrections and
program updates are needed.
II. Discussion of the Proposed Rule
The SFH program routinely meets with staff and partners to provide
them with the opportunity to discuss suggestions for process
improvement(s) to reduce the burden on grantees and borrowers, increase
the flexibility of the program and improve overall customer
satisfaction. As a result of these consultations, SFH has identified
several processes and regulatory improvements which are described in
the next section. Continued stakeholder input is vital to ensure the
proposed changes would support the Self-Help Program's mission, while
ensuring that regulation changes are reasonable and do not overly
burden the Agency's staff and their customers.
III. Summary of Proposed Changes
The following information details the changes in the proposed rule:
(1) Make general revisions to streamline and update 7 CFR part
1944, subpart I:
a. Remove/replace outdated references (e.g., County Office, County
Supervisor, and District Director).
State personnel and office locations have changed over the years,
and the terms ``County Office'', ``County Supervisor'', and ``District
Director'' are no longer used by the Agency. The Agency personnel
assigned to review Self-help Program applications, and the person
assigned to service the grant, could be different people in different
parts of the State. The term ``Authorized Agency Official'' will be
used to generalize assignments and allow states the flexibility to
assign work for the program as needed.
b. Replace references to ``FmHA or its successor agency under
Public law 103-354'' with ``Rural Housing Service'' or ``Agency.''
In 2006, the FmHA was fully terminated, and its housing and
community programs were transferred to the newly formed USDA Rural
Development. The proposed rule intends to replace the term ``Farmers
Home Administration'' with the terms ``Agency'' and ``Rural Housing
Service.''
c. Replace references to ``SF-269A'' with ``SF-425.''
The Standard Form (SF 269A) was obsoleted several years ago. It
will be replaced with the Federal Financial Report, Standard Form (SF)-
425.
d. Remove paragraph (d) from 7 CFR 1944.406 ``Prohibited use of
grant funds.''
Removing 7 CFR 1944.406(d) will align the regulation with 2 CFR
part 200 language which allows grant funds to be used for employee
training.
e. Remove requirements to submit a preapplication or application in
an original and one copy.
The Agency has moved to Electronic Customer Files (ECF) and no
longer requires hard copy paper preapplication or applications. This
update will streamline and modernize the program while also reducing
environmental impact.
f. Revise 7 CFR 1944.424 ``Dwelling construction standards.''
The Agency intends to update the paragraph to replace ``local
codes'' with ``State, Tribal, or local requirements.''
g. Remove requirement to submit an Affirmative Fair Housing
Marketing Plan (AFHMP).
The Agency has determined that the AFHMP is unnecessary considering
marketing materials are collected and reviewed along with a very-low
outreach plan. The Agency does not have its own AFHMP form, and the
Housing and Urban Development form being used by Single-Family Housing
has not been kept updated. This action will cause the removal of
1944.410(a)(10) and 1944.410(b)(1)(iv). Self-help organizations are
must still comply with all civil right laws as directed in the grant
agreement.
(2) Revise 7 CFR 1944.401 ``Objectives'' to remove outdated and
incorrect statements.
The Agency intends to update the introductory paragraph to reflect
the program's current objectives and represent the population it is
designed to serve.
(3) Revise 7 CFR 1944.403 ``Definitions.''
Definitions will be added which are intended to provide additional
clarity to stakeholders about the program.
(4) Revise 7 CFR 1944.404(d) to allow `Board of Directors' to be
defined at 7 CFR 1944.403 ``Definitions.''
SFH has determined that the language in this part of the regulation
is out of place and should be moved to the definitions section. In
addition, the requirement for all organizations to have a specific
number of board members has been overly restrictive in some extremely
rural areas. The Agency proposes to provide organizations with more
flexibility related to the required number of board members in the
regulatory definitions section.
(5) Revise 7 CFR 1944.407 ``Limitations.''
This section of the regulation limits the amount of technical
assistance (TA) an organization may apply for. The Agency proposes that
the limitations in paragraphs (a), (b), (c), and (d) should be as
follows:
Remove the following sentence in paragraph (a), ``Upon request, the
County Supervisor will provide the grantee the average cost of modest
homes for the area.'' The equivalent value of a modest home will be
established by the Agency on an annual basis as described in the
definition at 7 CFR 1944.403. The National Office will use a percentage
of the area loan limit to establish the equivalent value of a modest
home annually.
Revise paragraph (b) ``An average TA cost per equivalent unit that
does not exceed the difference between the equivalent value of modest
homes in the area and the average mortgage of the participating
families minus $1,000'' to increase to `. . . minus $10,000' which will
reduce the historically higher than necessary amount that can be
charged to the grant.
Revise paragraph (c) and move to paragraph (d) to remove the State
Director's approval of a technical assistance cost above the limits set
in paragraphs (a) and (b) in favor of this approval being at the
National Office level. Add other limitations may apply which will be
released in an annual funding policy. As program funding remains
unchanged or decreases annually, funding limitations may be necessary
to manage program funds.
The revised paragraph (c) will add a maximum TA cost per equivalent
unit for rehabilitation-type programs. The maximum TA cost per
equivalent unit will be no more than a percentage of the cost of the
equivalent value of modest homes built in the area. The levels will be
set in the regulation as not to exceed 12 percent for acquisition
rehab, and 9 percent for owner-occupied.
(6) Revise 7 CFR 1944.409 ``Intergovernmental Consultation,
Executive Order 12372.''
The Agency intends to update the title and paragraph language of
this section.
(7) Revise 7 CFR 1944.410 ``Processing preapplications,
applications, and completing grant dockets.''
As a consequence of historically limited funding for the Self-help
Program, funds have not been available
[[Page 96132]]
for predevelopment grant awards. Proposed changes to the regulation
will include items typically collected during the preapplication phase
being incorporated into a part of the application docket.
Other proposed changes/clarifications to Sec. 1944.410 include:
Add the requirement to submit the organization's previous years
financial audit in paragraph (a)(3).
Remove the current requirement in paragraph (a)(5) ``. . . living
in houses that are deteriorated, dilapidated, overcrowded, and/or
lacking plumbing facilities.''
Specify in paragraph (b) that a preapplication review will only be
completed when preapplications are accepted by the Agency. Typically,
the full application docket will be reviewed.
Remove references to Form AD 622, ``Notice of Preapplication Review
Action'' in paragraphs (b)(4)(i), (ii), and (e) in favor of issuing a
letter of conditions for eligible preapplications/applications or
denial letter with appeal rights for those found to be ineligible.
Remove the $10,000 limit in paragraph (d), and the up to six-month
period of performance stipulation for predevelopment grants. Should
funding allow for predevelopment grants these limitations will be set
in an annual funding policy or other public release announcing the
acceptance of preapplications.
In paragraph (e)(2) at the time of application, specify that the
first group can be determined eligible by the Agency or the
organization; and in paragraph (3) lots do not need to be optioned;
however, both will be a condition of closing. The Agency does not have
funding for predevelopment grants to aid organizations in meeting these
requirements, and in many cases, it is unreasonable to have a group
ready to begin construction prior to the approval of the application.
In paragraph (e)(7) clarify that a detailed budget is required in
addition to SF 424A.
Remove paragraph (c) and renumber paragraphs (d) and (e)
accordingly.
(8) Update 7 CFR 1944.411 paragraphs (e) and (g) requirements for
fidelity bonding and to establish an interest-bearing checking account.
The regulation currently prohibits Grantees from drawing funding
beyond a 30-day advancement, thus fidelity bonding is not needed. The
Agency proposes to revise this section to read ``The grantee has
established an interest-bearing checking account in accordance with 2
CFR 200.305(b)(8).''
(9) Remove 7 CFR 1944.412 ``Docket preparation'' chart in favor of
an application checklist to be provided by the program office.
Remove the chart currently in this section and include a complete
application checklist provided by the program office. Electronic
applications will be accepted.
(10) Revise 7 CFR 1944.413 ``Grant approval'' to reflect the
current practices.
The National Office reviews, approves, and obligates all funding
for the Self-help Program. The current process for application review
is the docket will first be reviewed by the Technical and Management
Assistance (T&MA) Contractor before submission to the RD Office
designated by the State. After the field review and recommendation, the
docket is submitted to the National Office for final review, approval,
and funding. In addition to outlining this process, paragraph (a)(2)
will be edited to remove reference to the Finance Office, as the
Finance Office no longer processes obligations or fund disbursements as
described. Reference to and use of Form RD 440-57 will be removed.
(11) Revise 7 CFR 1944.415 ``Grant approval and other approving
authorities.''
Funding for the Self-help Program remains limited, and the National
Office must retain grant approval authority to manage the allocation of
funds. SFH proposes to remove the State Director grant approval limits
in paragraphs (a) and (b), and to combine the new paragraphs into one
paragraph (a).
Renumber paragraph (d) to be paragraph(c), and update the former
paragraph (d), (1), (2) and (3) regarding the Agency official
authorized to approve monthly expenditures when a grantee serves more
than one county or state. The monthly expenditures should normally be
approved by the Housing Program Director or designee and update the
options for grantees working in multiple states. Should an organization
propose to operate in more than one state the National Office will
determine the appropriate approval official.
(12) Update 7 CFR 1944.416 ``Grant closing.''
Revise the paragraph to replace `Agreement' with `Grant Agreement'
and remove the reference to 7 CFR 1944.403(a);
Add that cost may not be allocated to the Grant Agreement prior to
execution; and Authorize the State Director or designee to execute the
Grant Agreement on behalf of the Agency.
(13) Update 7 CFR 1944.417 ``Servicing actions after grant
closing.''
Revise paragraph (a) to state that draws may be requested as needed
but no more than monthly, and that funding requests must be accompanied
by an actual or projected budget.
Update paragraph (a)(1) to remove references to Form RD 440-57,
``Acknowledgment of Obligated Funds/Check Request'' which is no longer
in use. Form RD 440-57 ``Acknowledgment of Obligated Funds/Check
Request'' will also be removed from paragraph (a) (2)(i) and (ii).
Revise paragraph (b) to specify quarterly reports are based on the
grant start date instead of listing the 15th day of January, April,
July, and October; change reference to Exhibit B to Subpart I of Part
1944 ``Evaluation Report of Self-Help Technical Assistance (TA)
Grants'' to state that generally a `progress report' and/or `quarterly
report' will be submitted to allow for automated reporting systems to
be used instead of Exhibit B to Subpart I of Part 1944 ``Evaluation
Report of Self-Help Technical Assistance (TA) Grants'' which will
remain in the instruction as a guide where it can be easily updated as
needed; replace `should' with `will' in reference to grant oversight
quarterly meetings; and add language to allow the option to require
more frequent reporting if problems are identified.
In paragraph (b)(1)(iv), remove specific reference to Exhibit B-2
to Subpart I of Part 1944 ``Breakdown of Construction Development for
Determining Percentage Construction Completed'' in favor of the general
term `construction development breakdown'.
Add paragraph (b)(1)(v) to reference the new grant goal proposed in
7 CFR 1944.419(a)(5).
Add paragraph (b)(1)(vi) to reference grant goal at 7 CFR
1944.419(a)(6).
(14) Update 7 CFR 1944.419 ``Final grantee evaluation.''
The requirements for obtaining a grant rating of `successful' are
minimal and do not accurately reflect rating a rehabilitation program.
Update the grant goals to establish a minimum sweat equity/cost savings
goal as part of the application process.
(15) Update 7 CFR 1944.420 ``Extension or revisions of the grant
agreement.''
This change updates the grant extension period from a ceiling of no
more than one year to less restrictive language of a period that is
``reasonable''. Reasonability will be determined based on consideration
of grant goals completed, and the timeline to complete the remaining
goals. Typically, this will be from one to two years.
[[Page 96133]]
(16) Update 7 CFR 1944.421 ``Refunding of an existing grantee'' to
establish a process for `Carry-over' equivalent units.
High producing grantees often start homes in one grant cycle but
finish them in another. Language is purposed to allow this practice
with parameters.
(17) Revise and update 7 CFR 1944.422 ``Audit and other reporting
requirements.''
Remove special provisions for nonprofits, State and local
governments, and Indian Tribes found at 7 CFR 1944.422 (a) and (b). 2
CFR part 200 does not have these exemptions listed which were
previously authorized. All grantees will have the same reporting
requirements as defined in 2 CFR part 200.
Add language regarding auditing requirements for 502/504 borrowers
supervised or custodial accounts. Direction regarding the audit
requirements for 502/504 borrowers supervised or custodial accounts
when managed by the grantee is needed. While a separate audit is not
necessary, these accounts should be reviewed under an agreed-upon
procedures format, not a single audit, as the grantee only manages
these funds in trust.
(18) Revise 7 CFR 1944.423 ``Loan/grant packaging and application
submittal.''
This change updates the title of the section and adds reference to
Section 504.
(19) Revise 7 CFR 1944.424 ``Dwelling construction standards''
This change adds State and Tribal requirements to the dwelling
construction standards versus just local codes.
(20) Update 7 CFR 1944.425 ``Handling and accounting for borrower
loan funds.''
This section's updates include stating that the Agency is
responsible for the administration of borrower loan funds. Grantee
involvement such as holding a custodial or supervised account to manage
these funds will be approved at the State level with minimum approval
guidelines for staff to be defined in the program Instruction.
(21) Revise 7 CFR 1944.426 ``Grant closeout.''
This change modifies the number of days, from 7 to 30, that the
agency has to respond to the grantee regarding notification of
termination and updates information on grant suspension appeal
guidance.
(22) Remove Subpart I of Part 1944 Exhibits A, B, B-1, B-2, B-3, C,
D, and E. Subpart I of Part 1944 Exhibits A, C, D, and E will be
published as Forms.
References to Exhibits B, B-1, B-2, and B-3 will be eliminated from
the CFR in favor of publishing them in the program Instruction with
updates. These Exhibits will be provided to organizations by the
program offices.
Exhibit A to Subpart I of Part 1944 ``Self-Help Technical
Assistance Grant Agreement'' will be published as a Form and revised to
include the new goals established with this proposed rule and add
language to reference any closing conditions letter attached.
Exhibit C to Subpart I of Part 1944 ``Amendment to Self-Help
Technical Assistance Grant Agreement'' and Exhibit D to Subpart I of
Part 1944 ``Self-Help Technical Assistance Grant Predevelopment
Agreement'' will be published as Forms and revised to update the year
from `19_ to `20_.
Exhibit E to Subpart I of Part 1944 ``Guidance for Recipients of
Self-Help Technical Assistance Grants (Section 523 of Housing Act of
1949)'' will be published as a Form and updated to remove outdated
questions such as B.5. related to long distance phone call logs, B.8.
regarding families being charged for the use of tools which is
confusing given some grantees do rent tools to families when they are
able to offer the best value, amongst other revisions.
(23) Revise instruction in Exhibit F to Subpart I of Part 1944
``Site Option Loan to Technical Assistance Grantees'' and add it as a
new section in 7 CFR 1944.428.
The limitations provided for in this exhibit are a barrier to
applicants in the current market in which larger loan amounts and
longer repayment terms are necessary. There has not been a Section 523
Site Loan awarded in many years because the program parameters are not
feasible (e.g. low loan limit, revolving loan fund requirements,
interest rate disparity, and short repayment terms).
Revise Section IV. `Limitations' to remove the $10,000 loan limit
in item (A) in favor of publishing limits as necessary (based on
funding availability) in an annual funding policy and removing the loan
limitation of fifteen percent of the purchase price in item (B);
section V Rates and Terms to change item (A) so that the interest rate
will be the lower of 3 percent or the current RHS monthly published
rate, item (B) to revise the repayment period to allow for multiple
payments.
The revision would align the program with current market trends and
reference the Section 524 program requirements to ease the application
process and promote the utilization of program funds. Program
information will also be moved to the body of the regulation under
1944.428 as a new section.
Request for Comment
Stakeholder input is vital to ensure the proposed changes in the
proposed rule would support the Agency's mission, while ensuring that
new regulations and policies are reasonable and do not overly burden
the Agency's staff and their customers. Comments must be submitted on
or before February 3, 2025 and may be submitted electronically by going
to the Federal eRulemaking Portal: <a href="http://www.regulations.gov">http://www.regulations.gov</a>. Details
on how to submit comments to the Federal eRulemaking Portal are in the
ADDRESSES section of this proposed rule.
IV. Regulatory Information
Executive Order 12372, Intergovernmental Review of Federal Programs
Intergovernmental Review of Federal Programs,'' applies to this
program. This E.O. requires that Federal agencies provide opportunities
for consultation on proposed assistance with State and local
governments. Many states have established a Single Point of Contact
(SPOC) to facilitate this consultation. For a list of States that
maintain a SPOC, please see the White House website: <a href="https://www.whitehouse.gov/omb/management/office-federal-financial-management/">https://www.whitehouse.gov/omb/management/office-federal-financial-management/</a>.
If your State has a SPOC, you may submit a copy of the application
directly for review. Any comments obtained through the SPOC must be
provided to your State Office for consideration as part of your
application. If your state has not established a SPOC, you may submit
your application directly to the Agency. Applications from Federally
recognized Indian Tribes are not subject to this requirement. RHS
conducts intergovernmental consultations for each loan in accordance
with 2 CFR part 415, subpart C.
Executive Order 12866, Regulatory Planning and Review
This proposed rule has been determined to be not significant for
purposes of Executive Order 12866 and, therefore, was not reviewed by
the Office of Management and Budget (OMB).
Executive Order 12988, Civil Justice Reform
This proposed rule has been reviewed under Executive Order 12988.
In accordance with this rule: (1) Unless otherwise specifically
provided, all State and local laws that conflict with this rule will be
preempted; (2) no
[[Page 96134]]
retroactive effect will be given to this rule except as specifically
prescribed in the rule; and (3) administrative proceedings of the
National Appeals Division of the Department of Agriculture (7 CFR part
11) must be exhausted before suing in court that challenges action
taken under this proposed rule.
Executive Order 13132, Federalism
The policies contained in this proposed rule do not have any
substantial direct effect on States, on the relationship between the
National Government and the States, or on the distribution of power and
responsibilities among the various levels of Government. This proposed
rule does not impose substantial direct compliance costs on State and
local Governments; therefore, consultation with States is not required.
Executive Order 13175, Consultation and Coordination With Indian Tribal
Governments
This proposed rule has been reviewed in accordance with the
requirements of Executive Order 13175, ``Consultation and Coordination
with Indian Tribal Governments.'' Executive Order 13175 requires
Federal agencies to consult and coordinate with Tribes on a government-
to-government basis on policies that have Tribal implications,
including regulations, legislative comments or proposed legislation,
and other policy statements or actions that have substantial direct
effects on one or more Indian Tribes, on the relationship between the
Federal Government and Indian Tribes or on the distribution of power
and responsibilities between the Federal Government and Indian Tribes.
Consultation is also required for any regulation that preempts Tribal
law or that imposes substantial direct compliance costs on Indian
Tribal governments and that is not required by statute.
The Agency has determined that this proposed rule does not, to our
knowledge, have Tribal implications that require formal Tribal
consultation under Executive Order 13175. If a Tribe requests
consultation, the Rural Housing Service will work with the Office of
Tribal Relations to ensure meaningful consultation is provided where
changes, additions and modifications identified herein are not
expressly mandated by Congress.
National Environmental Policy Act
In accordance with the National Environmental Policy Act of 1969,
Public Law 91-190, this proposed rule has been reviewed in accordance
with 7 CFR part 1970 (``Environmental Policies and Procedures''). The
Agency has determined that i) this action meets the criteria
established in 7 CFR 1970.53(f); ii) no extraordinary circumstances
exist; and iii) the action is not ``connected'' to other actions with
potentially significant impacts, is not considered a ``cumulative
action'' and is not precluded by 40 CFR 1506.1. Therefore, the Agency
has determined that the action does not have a significant effect on
the human environment, and therefore neither an Environmental
Assessment nor an Environmental Impact Statement is required.
Regulatory Flexibility Act
This proposed rule has been reviewed with regard to the
requirements of the Regulatory Flexibility Act (5 U.S.C. 601-612). The
undersigned has determined and certified by signature on this document
that this rule will not have a significant economic impact on a
substantial number of small entities since this rulemaking action does
not involve a new or expanded program nor does it require any more
action on the part of a small business than required of a large entity.
Unfunded Mandate Reform Act (UMRA)
Title II of the UMRA, Public Law 104-4, establishes requirements
for Federal Agencies to assess the effects of their regulatory actions
on State, local, and Tribal Governments and on the private sector.
Under section 202 of the UMRA, Federal Agencies generally must prepare
a written statement, including cost-benefit analysis, for proposed and
Final Rules with ``Federal mandates'' that may result in expenditures
to State, local, or Tribal Governments, in the aggregate, or to the
private sector, of $100 million or more in any one year. When such a
statement is needed for a rule, section 205 of the UMRA generally
requires a Federal Agency to identify and consider a reasonable number
of regulatory alternatives and adopt the least costly, more cost-
effective, or least burdensome alternative that achieves the objectives
of the rule.
This proposed rule contains no Federal mandates (under the
regulatory provisions of title II of the UMRA) for State, local, and
Tribal Governments or for the private sector. Therefore, this rule is
not subject to the requirements of sections 202 and 205 of the UMRA.
Paperwork Reduction Act
The information collection requirements contained in this
regulation have been approved by OMB and have been assigned OMB control
number 0575-0043. This proposed rulemaking contains new reporting
requirements that would require approval under the Paperwork Reduction
Act of 1995 (44 U.S.C. chapter 35).
In accordance with the Paperwork Reduction Act of 1995, the Agency
announces its intention to request a revision to a currently approved
information collection for the Self-Help Technical Assistance Grant
program and hereby open a 60-day public commenting period.
Title: 7 CFR 1944-I, Self-Help Technical Assistance Grants.
OMB Docket Number: 0575-0043.
Expiration Date of Approval: May 31, 2027.
Type of Request: Revision of currently approved information
collection.
Abstract: This subpart set forth the policies and procedures and
delegates authority for providing technical assistance funds to
eligible applicants to finance programs of technical and supervisory
assistance for self-help housing loan program, as authorized under
section 523 of the Housing Act of 1949 under 42 U.S.C. 1472. This
financial assistance may pay part or all of the cost of developing,
administering, or coordinating a program of technical and supervisory
assistance to aid very low- and low-income families in carrying out
self-help housing efforts in rural areas. The primary purpose is to
locate and work with low-income families to secure decent, safe, and
sanitary housing. RHS will be collecting information from non-profit
organizations to enter into grant agreements. These non-profit
organizations will give technical and supervisory assistance, and in
doing so, they must develop a final application for section 523 grant
funds. This application includes Agency forms that contain essential
information for deciding eligibility.
Estimate of Burden: Public reporting burden for this collection of
information is estimated to average .99 hours per response.
Respondents: Public or private nonprofit organizations, State,
Local or Tribal Governments.
Estimated Number of Respondents: 70.
Estimated Number of Responses per Respondent: 29.
Estimated Number of Responses: 2,046.
Estimated Reporting Burden Hours on Respondents: 1,865.
Estimated Recordkeeping Burden Hours on Respondents: 170.
Estimated Total Annual Burden on Respondents: 2,035.
[[Page 96135]]
Copies of this information collection can be obtained from Kimble
Brown, Innovation Center--Regulations Management Division, at
<a href="/cdn-cgi/l/email-protection#c289abafa0aea7ec80b0adb5ac82b7b1a6a3eca5adb4"><span class="__cf_email__" data-cfemail="266d4f4b444a43086454495148665355424708414950">[email protected]</span></a>.
Comments: Comments are invited on: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of the RHS, including whether the information will have
practical utility; (b) the accuracy of RHS's estimate of the burden of
the proposed collection of information including the validity of the
methodology and assumptions used; (c) ways to enhance the quality,
utility, and clarity of the information to be collected; and (d) ways
to minimize the burden of the collection of information on those who
are to respond, including through the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology. All responses to this notice
will be summarized and included in the request for OMB approval. All
comments will become a matter of public record.
E-Government Act Compliance
RHS is committed to complying with the E-Government Act by
promoting the use of the internet and other information technologies to
provide increased opportunities for citizen access to Government
information, services, and other purposes.
Civil Rights Impact Analysis
Rural Development has reviewed this rule in accordance with USDA
Regulation 4300-4, Civil Rights Impact Analysis,'' to identify any
major civil rights impacts the rule might have on program participants
on the basis of age, race, color, national origin, sex, or disability.
After review and analysis of the rule and available data, it has been
determined that implementation of the rule will not adversely or
disproportionately impact very low, low- and moderate-income
populations, minority populations, women, Indian Tribes, or persons
with disability by virtue of their race, color, national origin, sex,
age, disability, or marital or familiar status. No major civil rights
impact is likely to result from this rule.
Assistance Listing
The program affected by this regulation is listed in the Assistance
Listing Catalog (formerly Catalog of Federal Domestic Assistance) under
number 10.420, Rural Self-Help Housing Technical Assistance.
Non-Discrimination Statement
In accordance with Federal civil rights laws and U.S. Department of
Agriculture (USDA) civil rights regulations and policies, the USDA, its
Mission Areas, agencies, staff offices, 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.
Program information may be made available in languages other than
English. Persons with disabilities who require alternative means of
communication to obtain program information (e.g., Braille, large
print, audiotape, American Sign Language) should contact the
responsible Mission Area, agency, staff office; or the 711 Federal
Relay Service.
To file a program discrimination complaint, a complainant should
complete a Form AD-3027, USDA Program Discrimination Complaint Form,
which can be obtained online at <a href="https://www.usda.gov/sites/default/files/document/ad-3027.pdf">https://www.usda.gov/sites/default/files/document/ad-3027.pdf</a>, from any USDA office, by calling (866) 632-
9992, or by writing a letter addressed to USDA. The letter must contain
the complainant's name, address, telephone number, and a written
description of the alleged discriminatory action in sufficient detail
to inform the Assistant Secretary for Civil Rights (ASCR) about the
nature and date of an alleged civil rights violation. The completed AD-
3027 form or letter must be submitted to USDA by:
(1) Mail: U.S. Department of Agriculture, Office of the Assistant
Secretary for Civil Rights, 1400 Independence Avenue SW, Washington, DC
20250-9410; or
(2) Fax: (833) 256-1665 or (202) 690-7442; or
(3) Email: <a href="/cdn-cgi/l/email-protection#2d7d5f424a5f4c40036443594c46486d585e494c034a425b"><span class="__cf_email__" data-cfemail="6c3c1e030b1e0d01422502180d07092c191f080d420b031a">[email protected]</span></a>
USDA is an equal opportunity provider, employer, and lender.
List of Subjects in 7 CFR 1944
Administrative practice and procedure, Aged, Cooperatives, Fair
housing, Grant programs--housing and community development, Home
improvement, Individuals with disabilities, Loan programs--housing and
community development, Low and moderate income housing, Manufactured
homes, Migrant labor, Rent subsidies, Reporting and recordkeeping
requirements, Rural areas.
For the reasons set forth in the preamble, the Rural Housing
Service proposes to amend 7 CFR part 1944 as set forth below:
PART 1944--HOUSING
0
1. The authority citation for part 1944 continues to read as follows:
Authority: 5 U.S.C. 301; 42 U.S.C. 1480.
Subpart I--Self-Help Technical Assistance Grants
0
2. Revise Sec. 1944.401 to read as follows:
Sec. 1944.401 Objective.
This subpart sets forth the policies and procedures and delegates
authority for providing Technical Assistance (TA) funds to eligible
applicants to finance programs of technical and supervisory assistance
for self-help housing, as authorized under section 523 of the Housing
Act of 1949. Any processing or servicing activity conducted pursuant to
this subpart involving authorized assistance to Rural Development
employees, members of their families, known close relatives, or
business or close personal associates, is subject to the provisions of
subpart D of part 1900 of this chapter. Applicants for this assistance
are required to identify any known relationship or association with a
Rural Development employee. This financial assistance may pay part or
all of the cost of developing, administering, or coordinating programs
of technical and supervisory assistance to aid very low- and low-income
families in carrying out self-help housing efforts in rural areas. Very
low-income families must receive a priority for recruitment and
participation and may not comprise less than the percentage stated in
Section 502 of the Housing Act of 1949, as amended, of those assisted
in any grant. The primary purpose is to fund organizations that are
willing to locate and work with low-income families to secure decent,
safe, and sanitary housing. Grantees will comply with the
nondiscrimination regulation subpart E of part 1901 of this chapter
which states that no person in the United States shall, on the grounds
of race, color, national origin, sex, religion, marital status, mental
or physical handicap, or age, be excluded from participating in, be
denied the benefits of, or be subject to discrimination in connection
with the
[[Page 96136]]
use of grant funds and all provisions of the Fair Housing Act of 1988,
as amended.
0
3. Revise and republish Sec. 1944.403 to read as follows:
Sec. 1944.403 Definitions.
(a) Agency. The Rural Housing Service within the Rural Development
mission area of the U.S. Department of Agriculture (or its successor
agency) which administers Section 523 grants.
(b) Administrator. The official of the Rural Housing Service within
the Rural Development mission area (or official of its successor
agency) delegated authority by the Secretary of the U.S. Department of
Agriculture to administer the Agency and its programs.
(c) Applicant. An organization that submits an application for a
Section 523 technical assistance or predevelopment grant.
(d) Acquisition Rehabilitation. The method of self-help housing
rehabilitation that assists a participant in acquiring and
rehabilitating a home through the program.
(e) Authorized Agency Official. An individual within a Rural
Development Office designated with responsibility for a Self-Help
Program function (e.g. application reviewer, approval official, grant
servicer, etc.).
(f) Board of Directors. The governing body of an organization and
its members. Typically, a board of directors will consist of no less
than five members. For smaller organizations (i.e., less than 5 staff
members) a board of 3 or 4 is authorized.
(g) Borrower. An applicant who has received a Section 502 Home
Purchase Loan or Section 504 Home Repair Loan or Grant.
(h) Closeout. The process of taking final action connected with a
completed or terminated grant, including closing of grantee accounts,
auditing grantee expenditures, and completing final reports. See also
``Final Grantee Evaluation''.
(i) Cost savings. The value gained by the program participant
through the contribution of their own labor to the project. This value
is calculated as follows:
(1) Acquisition Rehab. The cost savings is the difference between
the appraised values before and after project completion.
(2) Owner-Occupied Rehab. The cost savings is difference between
the cost to have a contractor make the repair(s) and the self-help cost
to the participant.
(j) Custodial account. An account with the project funding for the
participating families that is managed by the Self-Help Grantee.
(k) Date of completion. The date when all work under a grant is
completed or the expiration date in the TA grant agreement, or any
supplement or amendment to it, when Federal assistance ends.
(l) Debarment. A determination that a party is ineligible to
participate in, or receive assistance under, Federal programs made in
accordance with 2 CFR parts 180 and 417.
(m) Direct costs. Those costs that are specifically identified with
a particular project or activity. Grantees receiving funds from a
single grant source would typically consider all costs as direct costs.
(n) Disallowed costs. Those charges to a grant which Rural
Development determines cannot be authorized (see also 7 CFR 1944.406
Prohibited use of grant funds).
(o) Environmental review. An analysis of the impacts that an
activity funded with Agency funds may have on the natural or manmade
environment. See 7 CFR part 1970.
(p) Equivalent units. Equivalent units represent the ``theoretical
number of units'' arrived at by adding the equivalent percentage of
completion figure for each family in the self-help program (pre-
construction and actual construction) together at any given date during
program operations. The sum of the percentage of completion figures for
all participant families represent the total number of ``theoretical
units'' completed at any point in time. Equivalent units are useful in
measuring progress during the period of the grant and are not a
measurement of actual accomplishments. The number of equivalent units
for any group can never exceed the number of planned or completed
houses for that group.
(q) Equivalent value of a modest house. The typical cost of a
recent contractor-built modest home in the area financed by the Agency
plus the actual or projected costs of an acceptable site and site
development. If the Agency has not financed a contractor-built house
during the last twelve months, the value is established by use of
online home sales sites; or as a percentage of the Area Loan Limits as
published on the Agency website. The Equivalent value of a modest house
is established by the Agency.
(r) Existing grantee. A grantee that is currently operating a grant
from the Agency or that has operated a grant within the past two years.
(s) Family Labor Contribution. The value of labor contributed by a
participating family to the process of constructing or rehabilitating
their home. For new construction, each family in the group must
contribute labor on each other's homes to accomplish the 65 percent of
the total 100 percent of tasks defined to complete the dwelling. A
participating family may use a substitute to perform the labor with
prior approval of the Grantee and Rural Development. For rehabilitation
type grants, participating families must complete a proportional amount
of labor to the amount of rehabilitation tasks being completed but not
less than 10 hours for owner occupied rehab, and 50 hours for
acquisition rehab. Volunteer labor may be used in rehabilitation type
projects.
(t) Final grantee evaluation. An Agency evaluation performed in
accordance with 7 CFR 1944.419 at the end of the grant period to
determine if the grantee met its projected performance goals and
complied with program requirements.
(u) Grant Agreement. The legal document signed by the Self-Help
grantee and the Agency that sets forth the terms and conditions under
which technical assistance funds will be made available. The grant
agreement will typically be for a period of 24 months but may be
authorized for longer or shorter periods to accommodate the production
of grantees (i.e., larger grantees may require longer grant period and
vice versa).
(v) Grantee. An organization for which the Agency has closed a
Section 523 technical assistance or predevelopment grant.
(w) Group. Newly constructed homes under the Self-Help program are
typically built by families working together in groups of five or more.
State Director approval of groups less than five is required and may be
granted only when it is determined the requirements of the Self-Help
Program can be met (e.g. group labor, reduced building costs from bulk
ordering, etc.).
(x) Household. One or more persons who maintain residency together
in a home.
(y) High Risk. The designation given to a grantee by the State
Office when a grantee is at risk of or currently is not meeting the
self-help program's requirements.
(z) Indirect costs. Those costs that are incurred for common or
joint objectives and therefore, cannot be readily and specifically
identified with a particular project or activity, (e.g., self-help).
(aa) Low-income. An adjusted income standard developed in
accordance with the requirements of Section 501(b)(4) of the Housing
Act of 1949.
(bb) Membership Agreement. The document signed by a grantee and a
participating family that establishes
[[Page 96137]]
each party's responsibilities and obligations.
(cc) Modest. A property that is considered modest for the area,
with a market value that does not exceed the applicable area loan limit
as established by Rural Housing Service in accordance with 7 CFR
3550.63.
(dd) Mutual Self-Help Method. Refers to the contributory nature of
homebuilding in the Self-Help Program. Each family contributes to the
building of each home such that the total amount of labor contributed
by each family is approximately equal. (See also family labor
contribution.)
(ee) Organization.
(1) A State, political subdivision, or public nonprofit corporation
(including Indian Tribes or Tribal corporations); or
(2) A private nonprofit corporation that is owned and controlled by
private persons or interests and is organized and operated for purposes
other than making gains or profits for the corporation and is legally
precluded from distributing any gains or profits to its members.
(ff) Owner-Occupied Rehabilitation. The method of self-help housing
rehabilitation that serves a participant that owns and occupies the
home in need of repair at the time of application. Owners need not
occupy the homes while repairs are being made, provided there is a plan
for them to return to the home once the project is complete.
(gg) Participating family. Individuals and/or their families who
agree to build homes by the mutual self-help method and rehabilitate
homes by the self-help method. Participants are families with very low-
or low-incomes who have the ability to furnish their share of the
required labor input regardless of the handicap, age, race, color,
national origin, religion, family status, or sex of the head of
household.
(hh) Program requirements. Requirements set forth in any grant
document, agreement, statute, or regulation applicable to Section 523
grants.
(ii) Quarterly review. A formal assessment conducted quarterly by
those parties involved in the grant program (e.g., Grantee staff,
Agency staff including grant oversight official, field staff processing
the grantees packages, etc., and Technical and Management Assistance
contractor of a grantee's progress in meeting its Grant Agreement goals
and program requirements).
(jj) Reasonable costs. A cost is reasonable if, in its nature and
amount, it does not exceed that which would be incurred by a prudent
person under the circumstances prevailing at the time the decision was
made to incur the cost. To be considered reasonable, costs must meet
the following conditions:
(1) The cost is of a type generally recognized as ordinary and
necessary for the operation of the organization or the performance of
the Federal award.
(2) The cost meets the restraints or requirements imposed by such
factors as sound business practices; arms-length bargaining; Federal,
state, Tribal, and other laws and regulations; and terms and conditions
of the award.
(3) Market prices for similar goods or services are comparable.
(4) The individuals concerned acted with prudence in the
circumstances considering their responsibilities to the organization,
its members, employees, clients, the public at large, and the Federal
Government.
(5) In incurring the cost, the organization did not deviate
significantly from its established practices and, thereby,
unjustifiably increase the award's cost.
(kk) Rural Housing Service. The Agency within the Rural Development
mission area of the U.S. Department of Agriculture which administers
the Section 523 Mutual Self-Help grant program.
(ll) Self-help Method. The construction method by which an
individual family utilizes their labor to reduce the construction cost
of their home without an exchange of labor between participating
families. Unless otherwise authorized by the National Office, this
method is only funded for repair and rehabilitation type construction
(owner occupied or acquisition rehabilitation).
(mm) SHARES (Self-Help Automated Reporting and Evaluation System).
The primary monitoring tool used by the Agency. The information
accessible on SHARES includes data on construction, recruiting, and
budgetary data for each grantee, their participating families, and the
homes they are building.
(nn) Site inspections. Construction site inspections may be
conducted by the mortgage lender, or a qualified third party to ensure
the construction/repair work is being completed adequately, and
according to approved plans and specifications. At a minimum,
inspection must be conducted three times during the construction of a
house-after the footers are in place, once the framing is complete and
mechanical, electrical, and plumbing are roughed in, and when the local
authority has certified the house for occupancy.
(oo) Specialty tools. Specialty tools are those tools needed to
complete the construction of a home, not including hand tools that are
commonly needed to maintain a home, such as hammers, screwdrivers, tape
measures, pliers, and wrenches. Specialty tools include, but are not
limited to, power saws, electric drills, saber saws, ladders, and
scaffolds.
(pp) Sponsor. An existing entity that is willing and able to assist
an applicant, with or without charge, in applying for a grant and in
carrying out responsibilities under the agreement. Examples of sponsors
are local rural electric cooperatives, institutions of higher
education, community action agencies and other self-help grantees.
Also, when available, regional technical and management assistance
contractors may qualify to serve as a sponsor at no charge.
(qq) Supervised bank account. An account with a financial
institution established through a deposit agreement entered into
between the borrower, the Agency or Grantee, and the financial
institution.
(rr) Sweat equity. The benefit earned by the Mutual Self-Help
program participant for the contribution of their own labor to the
project construction. This value is calculated by subtracting the self-
help construction cost of the homes from the appraised value of the
homes.
(ss) Technical assistance. The organizing and supervising of groups
of families in the construction of their own homes including but not
limited to:
(1) Recruiting families who are interested in contributing labor in
the construction or rehabilitation of their homes and assisting such
families in obtaining housing loans.
(2) Conducting meetings with the participants to explain the self-
help program and subjects related to home ownership, such as loan
payments, taxes, insurance, maintenance, and upkeep of the property.
(3) Helping families in planning and developing activities that
lead to the acquisition and development of suitable building sites or
existing homes in the case of acquisition rehabilitation.
(4) Assisting families in selecting or developing house plans for
homes which will meet their needs and which they can afford. For
rehabilitation type projects, assisting families in assessing need
repairs.
(5) Assisting families in obtaining cost estimates for construction
materials and any contracting that may be required.
(6) Providing assistance in the preparation of loan and/or grant
applications.
(7) Providing construction supervision and training for families
while they construct or rehabilitate their homes.
[[Page 96138]]
(8) Providing financial supervision to individual families with
loans and/or grants which will minimize the time and effort required by
Rural Development in processing borrower expenditures for materials and
contract services.
(tt) Technical and Management Assistance (T&MA) contractor. An
organization which receives Agency funding to provide services to the
Agency and training and management assistance to grantees and
prospective grantees.
(uu) Termination. The Agency may terminate grantees when the
grantee fails to meet certain requirements or when the grantee requests
termination. A terminated grantee is ineligible for another Self-Help
program TA grant for at least two years.
(vv) Very low-income. An adjusted income standard developed in
accordance with the requirements of Section 501(b)(4) of the Housing
Act of 1949.
0
4. Amend Sec. 1944.404 by revising paragraph (d)(4) to read as
follows:
Sec. 1944.404 Eligibility.
* * * * *
(d) * * *
(4) Has a board of directors as defined in Sec. 1944.403 of this
subpart.
Sec. 1944.406 [Amended]
0
5. Amend Sec. 1944.406 by removing paragraph (d) and redesignating
paragraph (e) as new paragraph (d).
0
6. Amend Sec. 1944.407 by revising paragraphs (a), (b), (c), and (d)
to read as follows:
Sec. 1944.407 Limitations.
* * * * *
(a) An average TA cost per equivalent unit of no more than 15
percent of the cost of equivalent value of modest homes built in the
area; or
(b) An average TA cost per equivalent unit that does not exceed the
difference between the equivalent value of modest homes in the area and
the average mortgage of the participating families minus $10,000; or
(c) For rehabilitation type programs, the maximum TA cost per
equivalent unit will be no more than the provided percentage of the
cost of equivalent value of modest homes built in the area:
(i) For acquisition rehabilitation, 12 percent;
(ii) For owner-occupied rehabilitation, 9 percent; or
(d) A TA per equivalent unit cost that does not exceed an amount
established by the National Office. The National Office may establish
other limitations as necessary that will be released in a notice
published in the Federal Register.
0
7. Revising Sec. 1944.409 to read as follows:
Sec. 1944.409 Intergovernmental Consultation, Executive Order 12372.
The self-help program is subject to the provision of Executive
Order 12372 which requires consultation with State and local officials
to foster an intergovernmental partnership and strengthened federalism
by relying on State and local processes for the State and local
government coordination and review of proposed Federal financial
assistance and direct Federal development.
Applicants for the self-help program are required to contact their
state's Single Point of Contact (SPOC) to submit their Statement of
Activities and find out more information on how to comply with the
state's process under Executive Order 12372. To locate a SPOC for your
state, the Office of Management and Budget (OMB) has an official SPOC
list on their website. For those States that have a home page for their
designated SPCO, a direct link has been provided by clicking on the
State name.
States that are not listed on the OMB website page have chosen not
to participate in the intergovernmental review process, and therefore
do not have a SPOC. If you are located within a State that does not
have a SPOC, you may send application materials directly to the
awarding agency.
0
8. Revise and republish Sec. 1944.410 to read as follows:
Sec. 1944.410 Processing preapplications, applications, and
completing grant dockets.
(a) Form SF-424, ``Application for Federal Assistance.'' Form SF-
424 ``Application for Federal Assistance'' must be submitted by the
applicant to the Agency. It will be used to establish communication
between the applicant and RHS, determine the applicant's eligibility,
determine how well the project can compete with similar applications
from other organizations and eliminate any proposals which have little
or no chance for Federal funding before applicants incur significant
expenditures for preparing an application. In addition, the following
information will be attached to and become a part of the preapplication
or application:
(1) Complete information about the applicant's previous experience
and capacity to carry out the objective of the agreement.
(2) If the applicant organization is already formed, a copy of or
an accurate reference to the specific provisions of State or Tribal law
under which the applicant is organized; a certified copy of the
applicant's Articles of Incorporation and Bylaws or other evidence of
corporate existence; certificate of incorporation for other than public
bodies; evidence of good standing from the State or Tribe when the
corporation has been in existence 1 year or more; the names and
addresses of the applicant's members, directors, and officers; and, if
another organization is a member of the applicant-organization, its
name, address, and principal business. If the applicant is not already
formed, attach copies of the proposed organizational documents
demonstrating compliance with Sec. 1944.404(d) of this subpart.
(3) The organization's previous year's financial audit, and a
current (no more than 12 months old), dated and signed financial
statement showing the amounts and specific nature of assets and
liabilities together with information on the repayment schedule and
status of any debt owed by the applicant. If the applicant is being
sponsored by another organization, the same type of financial statement
also must be provided by the applicant's sponsor. Newly formed
organizations must have a sponsor.
(4) A narrative statement which includes information about the
amount of the grant funds being requested, area(s) to be served, need
for self-help housing in the area(s), the number of self-help units
proposed to be built, rehabilitated or repaired during the agreement
period, housing conditions of low-income families in the area and
reasons why families need self-help assistance. Evidence should be
provided that the communities support the activity and that there are
low- income families willing to contribute their labor in order to
obtain adequate housing. Evidence of community support may be letters
of support from local officials, individuals and community
organizations. The pre-application or application may contain
information such as census materials, local planning studies, surveys,
or other readily available information which indicates a need in the
area for housing of the type and cost to be provided by the proposed
self-help TA program.
(5) A plan of how the organization proposes to reach very low-
income families.
(6) A proposed budget which will be prepared on Form SF-424A,
``Budget Information (Non-Construction Programs)'' and accompanied by
the detailed budget being used by the organization will be completed to
address applicable assurances as
[[Page 96139]]
outlined in 2 CFR part 200 as adopted by USDA through 2 CFR part 400.
State and local Government will include an assurance that the grantee
shall comply with all applicable Federal statutes and regulations in
effect with respect to the periods for which it receives grant funding.
The State and local governments shall also comply with 2 CFR part 200
as adopted by USDA through 2 CFR part 400.
(7) A preliminary survey as to the availability of lots and
projected cost of the sites.
(8) A list of other activities the applicant is engaged in and
expects to continue, and a statement as to other sources of funding and
whether it will have sufficient funds to assure continued operation of
the other activities for at least the period of the agreement. If
multi-funded, its cost allocation plan or indirect cost rate must be
part of the pre-application or application.
(9) Whether assistance under paragraph (d) of this section is
requested and a brief narrative identifying the need, amount of funds
needed, and projected time period.
(b) Pre-application or application review. When program funding
does not allow the Agency to consider pre-application requests the
following steps will apply to the full application:
(1) Rural Development, within 30 days of receipt of the
application, Form SF-424 ``Application for Federal Assistance'', and
all other required information and material will complete a thorough
review for completeness, accuracy, and conformance to program policy
and regulations. Incomplete applications will be returned to the
applicant for completion. The Authorized Agency Official in the
prospective county will be contacted as to the need for the program in
the proposed area and if the necessary resources are available to the
grantee. This will include a discussion of the number of 502 and 504
units that will need to be committed to the grantee and the potential
work impact on the office during the grant period. If it is determined
that the Office lacks the resources (either personnel or funds) to
process all loan/grant requests in a timely manner, the local office
will communicate this need to the State Office along with a recommended
solution. (Lack of resources at the local level are not grounds to deny
a request). After the Agency has determined that the application is
complete and accurate, the materials in an applicant case file will be
assembled and forward it to the State Director. The case file, as a
minimum, must contain the following:
(i) Form SF-424 ``Application for Federal Assistance'',
(ii) Documentation required in accordance with 7 CFR part 1970, and
(iii) Eligibility recommendations.
(2) The State Director may, if needed, submit the organizational
documents with any comments or questions to the Office of General
Counsel (OGC) for a preliminary opinion as to whether the applicant is
or will be a legal organization of the type required by these
regulations and for advice on any other aspects of the preapplication
or application.
(3) The State Director, if unable to determine eligibility or
qualifications with the advice of the OGC, may submit the
preapplication to the National Office for review. The preapplication or
application will contain all memoranda from OGC giving the results of
its review. The State Director will identify in the transmittal
memorandum to the National Office the specific problem and will
recommend possible solutions and any information about the applicant
which would be helpful to the National Office in reaching a decision.
(4) After an eligibility determination has been made, which should
be completed within 30 days unless OGC is involved, the State Director
will:
(i) If the applicant is eligible, contact the National Office as to
the availability of funds or submit the proposal to the National Office
for authorization. If funds are available, the Deputy Administrator or
designee for Single Family Housing will issue a letter of conditions
that the applicant must meet.
(ii) If the applicant is determined ineligible, the Agency will
issue a denial letter that will inform the applicant that an appeal of
the decision may be made to the National Appeals Division under 7 CFR
part 11.
(c) Self-help technical assistance grant predevelopment agreement.
If funding is available, the applicant requested predevelopment
assistance, and the Agency determines that the applicant lacks the
financial resources to meet the conditions of grant approval, a grant
can be made for the applicant to provide what is required by paragraph
(d) of this section. Existing grantees proposing to operate in an area
different from the area that they are currently funded to operate are
eligible for this grant. However, this grant is available only once for
a defined area. This grant is available only after the letter of
conditions has been issued. Denial of this assistance is an appealable
decision under 7 CFR part 11.
(d) Form SF-424, ``Application for Federal Assistance.'' The
applicant will submit Form SF-424 ``Application for Federal
Assistance'' to the Agency. The application should provide a detailed
proposal of its goals including:
(1) Names, addresses, number in household, and total annual
household income of families who have been contacted by the applicant
and are interested in participating in a self-help housing project.
Community organizations including minority organizations may be used as
a source of names of people interested in self-help housing.
(2) Proof that the first group of prospective participating self-
help families have qualified for financial assistance by the
organization or Rural Development.
(3) Evidence that lots are available for the groups.
(4) Detailed cost estimates of houses to be built by the mutual
self-help method. Plans and specifications should be submitted with the
cost estimates.
(5) Proposed staffing need, including qualifications, experience,
proposed hiring schedule, and availability of any prospective
employees.
(6) Name, address, and official position of the applicant's
representative or representatives authorized to act for the applicant
and work with Rural Development.
(7) Budget information including a detailed budget for the Grant
Agreement period based upon the needs outlined in the proposal. The
detailed budget will be attached to a completed Form SF 424A
``Application for Federal Assistance.''
* * * * *
0
9. Amend Sec. 1944.411 by revising paragraphs (b), (d), (e), (g), and
(h) to read as follows:
Sec. 1944.411 Conditions for approving a grant.
* * * * *
(b) The applicant has met all of the conditions listed in Sec.
1944.410(d) of this subpart.
* * * * *
(d) A resolution has been adopted by the board of directors which
authorizes the appropriate officer to execute the required Grant
Agreement and Form RD 400-4, ``Assurance Agreement.''
(e) The grantee has insurance against employee dishonesty and
theft.
* * * * *
(g) The grantee has established an interest-bearing checking
account in accordance with 2 CFR part 200.
(h) The grantee has developed a membership agreement to be executed
by the grantee and the self-help participants which clearly sets forth
what is expected of each and has
[[Page 96140]]
incorporated a construction development breakdown negotiated with the
program office that clearly shows what work is expected of the
participating family.
0
10. Revise Sec. 1944.412 to read as follows:
Sec. 1944.412 Docket preparation.
When the application and all items required for the complete docket
have been received, the Agency will conduct a thorough review to ensure
the application has been properly and accurately prepared and that it
includes the required dates and signatures. The docket items will be
assembled in the order identified by the checklist provided to the
applicant by the program office.
0
11. Revise and republish Sec. 1944.413 to read as follows:
Sec. 1944.413 Grant approval.
(a) Approval of grant. Within 30 days of receiving a complete
application including recommendation from the T&MA Contractor and State
Authorized Official, the National Office will:
(1) Execute and distribute Form RD 1940-1 ``Request for Obligation
of Funds.''
(2) Process the obligation of funds and issue an approval letter of
conditions to the state.
(b) Cancellation of an approved grant. An approved grant may be
canceled before closing if the applicant is no longer eligible, the
proposal is no longer feasible, or the applicant requests cancellation.
Cancellation will be accomplished as follows:
(1) The State Authorized Agency Official will prepare Form RD 1940-
10, ``Cancellation of U.S. Treasury Check and/or Obligation,'' and send
it to the State Director with the reasons for cancellation. If the
State Director approves the request, Form RD 1940-10 ``Cancellation of
U.S. Treasury Check and/or Obligation'' will be returned to the
National Office for processing.
(2) The Agency will notify the applicant of the cancellation and
the right to appeal under 7 CFR part 11. If the applicant requested the
cancellation, no appeal rights are provided, but the applicant will
still be notified of the cancellation.
(c) Disapproval of grant. If a grant is disapproved after the
docket has been developed, the Agency will state the reason on the
original Form RD 1940-1 ``Request for Obligation of Funds'', or in a
letter to the applicant with appeal rights under 7 CFR part 11.
0
12. Revise and republish Sec. 1944.415 to read as follows:
Sec. 1944.415 Grant approval and other approving authorities.
(a) All application dockets, along with the T&MA Contractor and
State Authorized Agency Official's recommendations must be submitted to
the National Office for approval.
(b) The authority to contract for services is limited to the
Administrator of Rural Housing Service (RHS).
(c) Monthly expenditures of the grantee will normally be approved
by the Housing Program Director unless:
(1) The grantee operates in only one county; in which case the
authority may be delegated by the Housing Program Director.
(2) The grantee operates in more than one county; in which case the
State Director will designate the approving official.
(3) The grantee operates in more than one State, in which case the
National Office will designate the approving official.
(4) The expenditure is under contract authority, in which case the
Contracting Official Representative will approve the monthly
expenditure.
0
13. Revise and republish Sec. 1944.416 to read as follows:
Sec. 1944.416 Grant Closing.
The grant is closed on the date the Grant Agreement is executed by
the applicant and the Agency. Cost may not be allocated to, nor may
funds be advanced prior to the signing of the Agreement. The State
Director or designee is authorized to execute the agreement on behalf
of the Agency. Person(s) authorized by resolution may sign for the
applicant.
0
14. Revise and republish Sec. 1944.417 to read as follows:
Sec. 1944.417 Servicing actions after grant closing.
The Agency has a responsibility to help the grantee be successful
and avoid cases of fraud and abuse. Servicing actions also include
correlating activities between the grantee and Agency to the benefit of
the participating families. The amount of servicing actions needed will
vary in accordance with the experience of the grantee, but as minimum
the following actions are required:
(a) As needed, but no more than Monthly, the grantee will provide
the Agency with a request for additional funds on Form SF-270,
``Request for Advance or Reimbursement,'' and must be accompanied by a
working budget. This request need only show the amount of funds used
during the previous month, amount of unspent funds, projected need for
the next 30 days, and written justification if the request exceeds the
projected need for the next 30 days. Upon receipt of the grantee's
request, the Agency will:
(1) If the request appears to be in order, process the request and
make the payment by automatic transfer.
(2) If the request does not appear to be in order, immediately
contact the grantee to resolve the problem. After the contact:
(i) If the grantee's explanation is acceptable, process the
request, or
(ii) If the grantee's explanation is not acceptable, immediately
notify the grantee and order the amount of funds that appear reasonable
for the next 30 days. Unapproved funds that are later approved will be
added to the next month's request.
(b) Quarterly, after the grant start date, the grantee will submit
a progress report to the Authorized Agency Official which will verify
its progress toward meeting the objectives stated in the Agreement and
the application. A quarterly meeting will be scheduled between the
grantee, T&MA Contractor, and Agency and will be used as an opportunity
to review progress to date and make necessary adjustments for the
future. More frequent meetings may be required if the grantee was
previously identified as a High Risk grantee or will be identified as a
High Risk grantee at this time. As part of the quarterly meeting the
following will be done:
(1) The quarterly report and other information will be evaluated to
determine progress made to date. The Agency will comment on the
quarterly report as to whether the grantee is ahead or behind schedule
in each of the following areas:
(i) Assisting the projected number of families.
(ii) Serving very low-income applicants. Is the grantee reaching a
minimum of very low-income families as required in 42 U.S.C. 1472?
(iii) Equivalent units (EUs). Is the number of EUs completed
representative of lapse of time of the grant? For example, if 25
percent of the grant period has elapsed, are 25 percent of the number
of EUs completed?
(iv) Labor contributions by the family. Are the families working
together and are they completing the labor tasks as established on the
construction or rehabilitation development breakdown?
(v) Meeting the approved sweat equity (new construction), or family
cost savings goal. Are the families receiving the amount of sweat
equity or costing savings as described in the application?
(vi) Meeting other objectives in the Agreement. Is the grantee
submitting timely quarterly reports, audits, or other
[[Page 96141]]
required information. Are their issues with the construction/
rehabilitation projects or loan/grant packaging?
(2) The Agency will determine if the grantee is progressing
satisfactorily. However, if the Agency determines the grantee is not
performing satisfactorily, the Agency will notify the grantee that it
has been classified a ``High Risk'' grantee. The notice will specify
the deficiencies and inform the grantee of proposed remedies for
noncompliance. The notice will advise the grantee that the Agency is
available to assist and provide the name and address of an organization
that is under contract with the Agency to assist them. The State Office
will forward a copy of the report with comments, and the reasons for
classifying them as ``High Risk'' to the National Office. When the
period of time provided for corrective action has expired, an
assessment will be made of the progress by the grantee toward
correcting the situation. If the Agency determines:
(i) The situation has been corrected or reasonable progress has
been made toward correcting the situation, then the ``High Risk''
status will be lifted, and the grantee so notified.
(ii) The situation has not been corrected, but it is correctable if
additional time is granted, then an extension will be issued.
(iii) The situation has not been corrected and it is unlikely to be
corrected if given additional time, then the grant will be terminated
under Sec. 1944.426(b)(1) of this subpart.
0
15. Revise and republish Sec. 1944.419 to read as follows:
Sec. 1944.419 Final grantee evaluation.
At the end of the grant period, an evaluation of the grantee will
be conducted by the Agency. The Agency may use employees or an
organization under contract to provide the evaluation. The evaluation
is to determine how successful the grantee was in meeting goals and
objectives as defined in the agreement, application, this regulation,
and any amendments.
(a) This is a quantitative evaluation of the grantee to determine
if it met its goals in:
(1) Assisting the projected number of families in obtaining
adequate housing as proposed by the organization in the approved
application.
(2) Meeting the goal of assisting very low-income families stated
in section 502 of the Housing Act of 1949, and in Sec. 1944.401 of
this subpart.
(3) Meeting the Family Labor Contribution requirement specified in
under Sec. 1944.403(s) of this subpart, as applicable.
(4) Keeping costs within the approved budget in the application.
(5) Meeting the approved sweat equity (new construction), or family
cost savings goal (rehabilitation) stated in section Sec. 1944.403 of
this subpart.
(6) Meeting other objectives in the Grant Agreement including, but
not limited to timely reporting, construction standards, loan packaging
standards, etc.
(b) The evaluation is a narrative addressed to the grantee and
written in 3 parts, namely, findings, recommendations, and an overall
rating. The rating will be either unacceptable, acceptable, or
outstanding, as follows:
(1) Outstanding if the grantee met or exceeded all of the goals in
paragraph (a) of this section.
(2) Acceptable if the grantee met or exceeded three of the grant
goals.
(3) Unacceptable if the grantee failed to obtain an acceptable
rating. An unacceptable rating may cause the organization to be
ineligible for grant assistance should this say the following the
proceeding 2 years.
(c) After the State Director has reviewed the evaluation, a copy
will be mailed to the grantee. The grantee may request a review of the
evaluation with the Agency. This review is for clarification of the
material and to dispute the findings if they are known to be wrong. The
rating is not open for discussion except to the extent it can be proven
that the findings do not support the rating. If this is the case, the
Agency may amend the rating.
0
16. Revise and republish Sec. 1944.420 to read as follows:
Sec. 1944.420 Extension or revisions of the grant agreement.
The State Director or designee may execute an extension or
revision, at any time during the grant period, provided:
(a) The extension period is reasonable. The extension period is
reasonable if the goals can be completed within the timeline without
additional cost being incurred. Typically, an reasonable extension will
not exceed two years.
(b) The need for the extension is clearly justified.
(c) If additional funds are needed, a revised budget is submitted
with complete justification, and
(d) The grantee is within the guidelines in Sec. 1944.407 of this
subpart or the Agency determines that the best interest of the
Government will be served by the extension.
0
17. Revise and republish Sec. 1944.421 to read as follows:
Sec. 1944.421 Refunding of an existing grantee.
Grantees wishing to continue with self-help efforts after the end
of the current grant plus any extensions should file Form SF-424
``Application for Federal Assistance,'' in accordance with Sec.
1944.410. It is recommended that it be filed at least 6 months before
the end of the current grant period. Funds from the existing grant may
be used to meet the conditions of a new grant and equivalent units may
be split between two grant cycles. In addition to meeting the
conditions of an applicant as defined in Sec. 1944.411 of this
subpart, the grantee must also have received or will receive an
acceptable rating on its current grant unless an exception is granted
by the Agency. The Agency may grant an exception to the rating if it is
determined that the reasons causing the previous unacceptable rating
have been removed or will be removed with the approval of this grant.
0
18. Revise and republish Sec. 1944.422 to read as follows:
Sec. 1944.422 Audit and other report requirements.
The grantee must submit an audit to the Agency annually (or
biennially if a State or local government with authority to do a less
frequent audit requests it) and the earlier of 30 calendar days after
receipt of the auditor's report or nine months after the end of the
grantee's audit period. The audit, conducted by the grantee's auditors,
is to be performed in accordance with Generally Accepted Government
Auditing Standards (GAGAS), using the publication ``Standards for Audit
of Governmental Organizations, Programs, Activities and Functions''
developed by the Comptroller General of the United States in 1981, and
any subsequent revisions. In addition, the audits are also to be
performed in accordance with 2 CFR part 200, as adopted by USDA through
2 CFR part 400, and Agency requirements as specified in this subpart.
Audits of borrower loan funds will be required when the grantee
manages these funds during construction in a supervised or custodial
bank account. These funds are not awarded to the grantee; therefore,
they should not be shown on a Schedule of Federal Awards nor have the
same auditing requirements. Instead, an agreed upon procedures audit
that, at a minimum, includes a review of the draw down request to
ensure charges listed can be traced back to source documents, and
reconciliation of the bank account record. The number of borrower
accounts audited will be determined by
[[Page 96142]]
the auditor. In incidences where it is difficult to determine the
appropriate number of accounts to be audited, auditors should be
authorized by the State Director to audit the lesser of 10 loans or 10
percent of total loans.
0
19. Revise and republish Sec. 1944.423 to read as follows:
Sec. 1944.423 Loan/grant packaging and application submittal.
A grantee is required to assist 502/504 program applicants in
submitting their application for a loan and/or grant. Loan/grant
packaging will be performed in accordance with 7 CFR part 3550;
therefore, it is important that the grantee be trained at an early
date. Typically, this training should take place before the first
applications are submitted to the Agency Office and before the grant is
closed. A grantee should become very knowledgeable of the Agency's
eligibility requirements but must understand that only the Agency can
approve or deny an applicant assistance. The Grantee must work
cooperatively with the Agency in the loan approval process and must
work within the regulations for the program and recognize the Agency's
ultimate decision-making authority to approve or deny loans.
However, the grantee may ask for clarification that may be helpful
in working with future applicants. Grant funds may not be used to pay
any expense in connection with an appeal that the applicant may file or
pursue.
0
20. Revise and republish Sec. 1944.424 to read as follows:
Sec. 1944.424 Dwelling construction standards.
All construction will be performed in accordance with subpart A of
part 1924 of this chapter. The planned work must meet the building
requirements of 7 CFR part 3550 and meet the Development Standards as
defined in subpart A of part 1924 of this chapter and State, Tribal, or
local requirements. Sites and site developments must conform to the
requirements of subpart C of part 1924 of this chapter.
0
21. Revise and republish Sec. 1944.425 to read as follows:
Sec. 1944.425 Handling and accounting for borrower loan funds.
The Agency is responsible for administering borrower loan funds
during the construction phases. The extent of grantee involvement will
depend on the experience of the grantee and the amount of authority
delegated to them by the Authorized Agency Official in accordance with
Agency guidelines available in any Rural Development Office.
0
22. Revise and republish Sec. 1944.426 to read as follows:
Sec. 1944.426 Grant closeout.
(a) Grant purposes completed. Promptly after the date of
completion, grant closeout actions will be taken to allow the orderly
discontinuance of grantee activity.
(1) The grantee will immediately refund to the Agency any balance
of grant funds that are not committed for the payment of authorized
expenses.
(2) The grantee will furnish Form SF-425, ``Financial Status
Report'' and detailed final budget to the Agency within 90 days after
the date of completion of the grant. All other financial, performance,
and other reports required as a condition of the grant also will be
completed.
(3) After the grant closeout, the Agency retains the right to
recover any disallowed costs. 7 CFR part 3550 will be used by the
Agency to recover any unauthorized expenditures.
(4) The grantee will provide the Agency an audit conforming to
those requirements established in this part, including audits of self-
help borrower accounts.
(5) Upon request from the recipient, any allowable reimbursable
cost not covered by previous payments shall be promptly paid by the
Agency.
(b) Grant purposes not completed.
(1) Notification of termination. The State Director will promptly
notify the grantee and the National Office in writing of the
termination action including the specific reasons for the decision and
the effective date of the termination. The notification to the grantee
will specify that if the grantee believes the reason for the proposed
termination can be resolved, the grantee should, within 15 calendar
days of the date of this notification, contact the Agency in writing
requesting a meeting for further consideration. The meeting will be an
informal proceeding at which the grantee will be given the opportunity
to provide whatever additional information it believes should be
considered in reaching a decision concerning the case. The grantee may
have an attorney, or any other person present at the meeting if
desired. Within 30 calendar days of the meeting, the Agency will
determine what action to take.
(i) If the Agency determines that termination is not necessary, the
grantee will be informed in writing.
(ii) If the Agency determines that termination of the grant is
appropriate, the grantee will be notified in accordance with 7 CFR part
11.
(2) National Office review.
(i) Upon receipt of a request from a grantee that the decision of
the State Director be reconsidered, the National Office will make a
preliminary decision concerning the continued funding of the grantee
during the appeal period. Written notification of the decision will be
given to the State Director and grantee.
(ii) The National Office will then obtain a comprehensive report on
the matter from the State Office. This information will be considered
together with any additional information that may be provided by the
grantee.
(c) Grant suspension. When the grantee has failed to comply with
the terms of the agreement, the Agency will consider termination or
suspension of the grant usually only after a Grantee has been
classified as ``high risk'' in accordance with 7 CFR 1944.417(b)(2).
When the Agency determines that the grantee has a reasonable potential
to correct deficiencies the grant may be suspended. The suspension will
adhere to 2 CFR part 200 as adopted by USDA through 2 CFR part 400. The
grantee will be notified of the grant suspension in writing by the
Agency. The Agency will promptly inform the grantee of its rights to
appeal the decision in accordance with 7 CFR part 11.
(d) Grant termination. The State Director may terminate the grant
agreement whenever Rural Development determines that the grantee has
failed to comply with terms of the Agreement. The reasons for
termination may include, but are not limited to, such problems as
listed in paragraph (e)(3)(i) of the Grant Agreement. The State
Director may also withhold further disbursement of grant funds and
prohibit the grantee from incurring additional obligations of grant
funds with written approval of the National Office. Rural Development
will allow all necessary and proper costs which grantee could not
reasonably avoid.
(1) Termination for cause. The grant agreement may be terminated in
whole, or in part, at any time before date of completion, whenever
Rural Development determines that the grantee has failed to comply with
terms of the Agreement. The State Director will notify the grantee in
writing giving the reasons for the action and inform the grantee of its
rights of appeal by use of Exhibit B-3 to Subpart B of part 1900
``Letter for Notifying Applicants, Lender, Holders and Borrowers of
Adverse Decisions Where the Decision Involves an Appraisal (Not To Be
Used in Cases Involving Farmer Program Primary Loan Servicing
Actions.)''
(2) Termination for convenience. RHS, or its successor agency, or
the grantee
[[Page 96143]]
may terminate the grant in whole, or in part, when both parties agree
that the continuation of the grant would not produce beneficial
results. The two parties will agree in writing to the termination
conditions including the effective date. No notice of rights of appeal
will be issued by Rural Development.
0
23. Add Sec. 1944.428 to read as follows:
Sec. 1944.428 Site Loan to Technical Assistance Grantees
The objective of a Site Option (SO) loan under Section 523(b)(1)(B)
of Title V of the Housing Act of 1949 is to enable technical assistance
(TA) grantees or contractors to establish revolving fund accounts to
obtain options on land needed to make sites available to families that
will build their own homes by the self-help method. Loans may be made
only as necessary to enable eligible applicants to establish revolving
accounts with which to obtain options on land that will be needed as
building sites by self-help families participating in the TA self-help
housing program.
To be eligible for an SO loan, the applicant must be a TA grantee
that is currently operating in a satisfactory manner under a TA grant
agreement. If the SO loan applicant has applied for TA funds but is not
already a TA grantee and it appears that the TA grant will be made, the
SO loan may be approved but not closed until the TA grant is closed.
Applications will be processed, approved or disapproved, and closed in
accordance with 7 CFR 1822, subpart G, 1822.271 through 1822.275 and
adhere to the special requirements for RHS section 523 loans at 7 CFR
1822.278.
0
24. Revise and republish Sec. 1944.450 to read as follows:
Sec. 1944.450 OMB control number.
The information collection requirements contained in this
regulation has been approved by OMB and have been assigned OMB control
number 0575-0043. This proposed rulemaking contains new reporting
requirements that would require approval under the Paperwork Reduction
Act of 1995 (44 U.S.C. chapter 35).
Subpart I [Amended]
0
25. Amend Subpart I by removing Exhibits A through F.
Joaquin Altoro,
Administrator, Rural Housing Service.
[FR Doc. 2024-28032 Filed 12-3-24; 8:45 am]
BILLING CODE 3410-XV-P
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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.