Construction and Repair

SUMMARY: The Farmers Home Administration (FmHA) proposes to amend its

Planning and Performing Site Development Work regulation. This proposal

is consistent with Section 716 of the Housing and Community Development

Act of 1992 which amended Section 535 of the Housing Act of 1949 to

allow the Secretary to accept subdivisions that have been approved by

local, county or State agencies. FmHA will no longer review or approve

subdivisions, but will review individual sites for the program. This

action is consistent with similar actions being proposed or enacted by

HUD and VA. A good site approval authority will allow FmHA to bring

into the program many low cost homes in subdivisions that have already

been developed. Many of these were not previously reached because the

seller would not, or could not afford to furnish FmHA all the required

data for a total subdivision approval.

To assure that lower income people, particularly minorities and

single women head-of-households, are afforded quality sites,

subdivisions must meet the community standards and the sites must meet

FmHA's site underwriting criteria. Environmental reviews will be

required on a site by site basis and cumulative effects will be

addressed when indicated.

DATES: Comments should be received on or before October 18, 1994.

ADDRESSES: Submit written comments in duplicate to the Office of the

Chief, Regulation Analysis and Control Branch, Farmers Home

Administration, USDA, room 6348, South Agriculture Building, 14th and

Independence Avenue SW., Washington, DC 20250. All written comments

will be available for public inspection at the above address during

regular work hours.

FOR FURTHER INFORMATION CONTACT: Billy Chapman, Senior Loan Specialist,

Farmers Home Administration, USDA, Room 5334-S, South Agriculture

Building, 14th and Independence Avenue SW., Washington, DC 20250,

telephone (202) 720-1485.

SUPPLEMENTARY INFORMATION:

Classification

This rule has been determined to be not-significant for purposes of

Executive Order 12866 and therefore has not been reviewed by the Office

of Management and Budget.

Regulatory Flexibility Act

Bob Nash, Under Secretary, Small Community and Rural Development,

has determined that this action will not have a significant economic

impact on a substantial number of small entities because the regulatory

changes affect FmHA processing of section 502 loans and individual

applicant eligibility for the program.

Paperwork Reduction Act

The information collection or recordkeeping requirements contained

in this regulation will be submitted to the Office of Management and

Budget (OMB) for review under section 3504(h) of the Paperwork

Reduction Act of 1980. Public reporting burden for this collection of

information is estimated to vary from 5 minutes to 10 minutes per

response, including time for reviewing instructions, searching existing

data sources, gathering and maintaining the data needed, and completing

and reviewing the collection of information. Please send written

comments to the Office of Information Regulatory Affairs, OMB,

Attention: Desk Officer for USDA, Washington, DC 20503. Please send a

copy of your comments to Jack Holston, Agency Clearance Officer, USDA,

FmHA Ag Box 0743, Washington, DC 20250.

Environmental Impact Statement

This document has been reviewed in accordance with 7 CFR part 1940,

subpart G, ``Environmental Program.'' It is the determination of FmHA

that this proposed action does not constitute a major Federal Action

significantly affecting the quality of the human environment, and in

accordance with the National Environmental Policy Act of 1969, Public

Law 91-190, an Environmental Impact Statement is not required.

Intergovernmental Consultation

For the reason set forth in the final rule and related Notice to 7

CFR part 3015, Subpart V, 48 FR 29115, June 24, 1983, this program/

activity is excluded from the scope of Executive Order 12372 which

requires intergovernmental consultation with State and local officials.

Program Affected

These changes affect the following FmHA program as listed in the

Catalog of Federal Domestic Assistance:

10.410, Low Income Housing Loans.

Civil Justice Reform

This document has been reviewed in accordance with Executive Order

(EO) 12778. It is the determination of FmHA that this action does not

unduly burden the Federal Court Systems in that it meets all applicable

standards provided in Section 2 of the EO.

Regulatory Reform: Less Burdensome or More Efficient Alternatives

The Department of Agriculture is committed to carrying out its

statutory and regulatory mandates in a manner that best serves the

public interest. Therefore, where legal discretion permits, the

Department actively seeks to promulgate regulations that promote

economic growth, create jobs, are minimally burdensome and are easy for

the public to understand, use or comply with. In short, the Department

is committed to issuing regulations that maximize the net benefits to

society and minimize costs imposed by those regulations.

The Department has developed and reviewed this regulatory proposal

in accordance with these principles. Nonetheless, the Department

believes that public input from all interested persons can be

invaluable to ensuring that the final regulatory product is minimally

burdensome and maximally efficient. Therefore, the Department

specifically seeks comments and suggestions from the public regarding

any less burdensome or more efficient alternative that would accomplish

the purposes described in the proposal. Comments suggesting less

burdensome or more efficient alternatives should be addressed to the

agency as provided in this proposal.

Discussion

FmHA stands alone as the only Federal Agency that requires approval

of a complete subdivision prior to insuring or guaranteeing a loan for

a home within the subdivision. Developers, builders, realtors and

applicants for the programs have frequently complained that there is

too much ``red tape'' before an eligible applicant can receive an FmHA

loan within a well developed subdivision. Most counties and communities

now have adequate subdivision reviews, and FmHA's subdivision approval

is not needed to assure quality sites but is duplication of efforts.

This action permits the better use of existing developments and

decreases the environmental impact because not as many new developments

will be needed to meet the demand for lots that will meet the Agency's

requirements. It fits into existing growth patterns and places more

authority with the local people.

FmHA is committed to quality sites for its programs and therefore,

proposes close scrutiny of the site. The new site criteria incorporates

many of the prior subdivision requirements and makes them part of the

site underwriting criteria. This action provides for better sites,

without requiring the cumbersome subdivision review and approval

process. It also provides the loan applicant with assurance of a

quality water supply and property served by publicly owned and

maintained roads. The proposal provides for an orderly request for

review and systematic process of reviewing the site.

This proposed regulation omits the detailed internal agency

administrative instruction used by the field offices to administer the

program. In the past, FmHA program regulations and FmHA Instructions

have been identical. The Agency has adopted a policy of publishing

regulations which set forth anything which confers a benefit or imposes

an obligation on the public or which is necessary for the public to

understand their responsibilities. The Agency does not intend to

publish a regulation that omits or evades issues which are subject to

public comment or would be of interest to the public. Any substantive

changes in the regulation will continue to be published in the Federal

Register. Each FmHA field office has a copy of the FmHA Instruction and

a copy is available upon request to FmHA.

Conforming changes will be made in other FmHA regulations at the

final rule stage.

List of Subjects in 7 CFR Part 1924

Housing standards, Low and moderate income housing, Rural areas.

Therefore, as proposed, Chapter XVIII, Title 7, Code of Federal

Regulations is amended as follows:

PART 1924--CONSTRUCTION AND REPAIR

1. The authority citation for part 1924 continues to read as

follows:

Authority: 7 U.S.C 1989; 42 U.S.C. 1480; 5 U.S.C. 301; 7 CFR

2.23; 7 CFR 2.70.

Subpart C--Planning and Performing Site Development Work

2. Sections 1924.101 through 1924.150 of Subpart C of part 1924,

are revised and exhibit A is removed to read as follows:

PART 1924--CONSTRUCTION AND REPAIR

Subpart C--Planning and Performing Site Development Work

Sec. 1924.101 Purpose.

-This subpart establishes the basic Agency policies for planning

and performing site development work. It also provides the procedures

and guidelines for preparing site development plans consistent with

Federal laws, regulations and Executive Orders.

Sec. 1924.102 General policy.

(a) Rural development. This subpart provides for the development of

building sites and related facilities in rural areas. It is designed

to:

(1) Recognize community needs and desires, and encourage leadership

responsibility in local planning, control and development.

(2) Recognize standards for building-site design which encourage

and lead to the development of economically stable communities, and the

creation of attractive, healthy, and permanent living environments.

(3) Encourage improvements planned for the site to be the most

cost-effective of the practicable alternatives. Encourage utilities and

services utilized to be reliable, efficient and available at reasonable

costs.

(4) Provide for a planning process that will consider impacts on

the environment and existing development in order to formulate actions

that protect, enhance, and restore environmental quality.

(b) Subdivisions. The Agency does not review or approve

subdivisions. Each site approved by the Agency must meet the

requirements of Sec. 1924.115 of this subpart, on a site by site basis.

(c) Development related costs.

(1) Applicant. The applicant is responsible for all costs incurred

before loan and/or grant closing associated with planning, technical

services, and actual construction. These costs may be included in the

loan/grant as authorized by Agency regulations.

(2) Developer. The developer is responsible for payment of all

costs associated with development under this subpart.

Sec. 1924.103 Scope.

-This subpart is for Agency personnel when considering a site or

site development work for Rural Housing (RH) loans for individuals. It

provides supplemental requirements for Rural Rental Housing (RRH)

loans, Rural Cooperative Housing (RCH) loans, Farm Labor Housing (LH)

loans and grants, and Rural Housing Site (RHS) loans. It also provides

a site development standard (Exhibit B of this subpart) which

supplements this subpart to determine the acceptability of development.

All of this subpart applies to Single Family Housing unless otherwise

noted. All of this subpart also applies to Multiple Family Housing

except Secs. 1924.115, 1924.120 and 1924.121, which applies only to

Single Family Housing, and any paragraph specifically shown for Single

Family Housing. In addition, the Agency will consult with appropriate

Federal, State, and local agencies, other organizations, and

individuals to implement the provisions of this subpart.

Sec. 1924.104 Definitions.

As used in this subpart:

Agency. Farmers Home Administration (FmHA).

Applicant. Any person, partnership, limited partnership, trust,

consumer cooperative, corporation, public body or association that has

filed a preapplication, or in the case of Agency programs that do not

require a preapplication, an official application with the Agency in

anticipation of receiving or utilizing Agency financial assistance.

Community. A community includes cities, towns, boroughs, villages,

and unincorporated places which have the characteristics of

incorporated areas with support services such as shopping, post office,

schools, central sewer and water facilities, police and fire

protection, hospitals, medical and pharmaceutical facilities, etc., and

are easily identifiable as established concentrations of inhabited

dwellings and private and public buildings.

Developer. Any person, partnership, public body or corporation

which intends to develop a site(s) and ask the Agency to finance it.

Development. The act of building structures and installing site

improvements on an individual dwelling site, a subdivision, or a

multiple family tract.

Multiple Family Housing. Agency Rural Rental Housing loans, Rural

Cooperative Housing loans, Farm Labor Housing loans and grants, and

Rural Housing Site loans.

Single Family Housing. Agency Rural Housing loans for individuals

for construction of, repair of, or purchase of a dwelling to be

occupied by one household.

Site. A parcel of land proposed as a dwelling site, with or without

development.

Site approval official. The Agency official making the

determination that a site meets the requirements in this subpart to be

acceptable for site loans. (See Sec. 1924.120 of this subpart.)

Street surfaces. Streets may be hard or all weather surfaced.

(1) Hard surface--a street with a portland cement concrete,

asphaltic concrete, or bituminous wearing surface or other hard

surfaces which are acceptable and suitable to the local public body for

use with local climate, soil, gradient, and volume and character of

traffic.

(2) All-weather--a street that can be used year-round with a

minimum of maintenance, such as the use of a grader and minor

application of surface material, and is acceptable and suitable to the

local public body for use with local climate, soil, gradient, and

volume and character of traffic.

Subdivision. Five or more contiguous (developed or undeveloped)

lots, or building sites. Subdivisions may be new or existing.

Sec. 1924.105 Planning/performing development.

(a) General. Planning is an evaluation of specific development for

specific land uses. Planning must take into consideration topography,

soils, climate, adjacent land use, environmental impacts, energy

efficiency, local economy, aesthetic and cultural values, public and

private services, housing and social conditions and a degree of

flexibility to accommodate changing demands. Although all planning and

performing development work is the responsibility of the applicant or

developer, close coordination must occur with local planning officials

and with the respective Agency office to minimize the chances of

spending money on development that does not meet the Agency's

requirements. All development will be arranged and completed according

to applicable local, State or Federal regulations including applicable

health and safety standards, environmental concerns and requirements of

this subpart. When a public authority requires inspections prior to

final acceptance, written assurance by the responsible public

authority, of compliance to local, city, county, State or other public

codes, regulations and ordinances is required prior to final acceptance

by the Agency.

(1) Agency advice and assistance. Applicants and developers shall

be encouraged to seek the advice and assistance of the Agency before

significant expenditures are made. Actions taken which are not in

accordance with this subpart may jeopardize the possibility of

receiving future financial assistance from the Agency. When receiving

an inquiry about a Single Family Housing site development or a Multiple

Family Housing project, the Agency official receiving the request will:

(i) Provide information regarding publications, site planning,

engineering data, environmental data, soils data, and other technical

advice and assistance which are available through local, State, and

Federal agencies, planning commissions, and private institutions and

organizations.

(ii) Explain the requirements for compliance with subpart G of part

1940 of this chapter, as well as the limitations on applicants during

the application review process as prescribed in Sec. 1940.309 of

subpart G of part 1940 of this chapter.

(iii) Discuss the requirements of the Agency with respect to

compliance with local, regional, and State regulations; construction

practices; energy efficiency; nondiscrimination; market analysis; good

site planning; and location. Also, when applicable, provide and explain

Form FmHA 400-4, ``Assurance Agreement,'' Form FmHA 400-1 ``Equal

Opportunity Agreement,'' and HUD Form 935.2, ``Affirmative Fair Housing

Marketing Plans.''

(2) Technical services.

(i) Professional assistance is available from the Soil Conservation

Service (SCS) and the Cooperative Extension Service.

(ii) An applicant or developer for a Multiple Family Housing

project or a Single Family Housing site which requires technical

services under Sec. 1924.13(a) of subpart A of this part, must contract

for the technical services of an architect, engineer, land surveyor,

landscape architect, or site planner, as appropriate, to provide

complete planning, drawings, and specifications. Such services may be

provided by the applicant's or developer's ``in house'' staff subject

to Agency concurrence. Technical services must be performed by

professionals who are qualified and authorized to provide such services

in the State in which the project would be developed. All technical

services must be provided in accordance with the requirements of

professional registration or licensing boards. For payments for

technical services, follow Sec. 1924.102(c) of this subpart. At

completion of all construction or completion of a phase or phases of

the total project, the person(s) providing technical services under

this section must notify the Agency office in writing that all work has

been completed in substantial conformance with the approved plans and

specifications.

(iii) For developments not specifically required to have technical

services under paragraph (a)(2)(ii) of this section, such services may

be required by the State Director when construction of streets or

installation of utilities is involved.

(3) Drawings, specifications, contract documents, and other

documentations. Adequate drawings and specifications must be provided

by the applicant or developer to fully describe the work. Contract

documents must be prepared under Sec. 1924.6 or, in the case of more

complex construction, Sec. 1924.13 of subpart A of this part.

(b) Single Family Housing. Proposals for development of individual

dwelling sites have the following specific requirements:

(1) Site development design requirements. Exhibit B of this subpart

will be used as a guide by applicants or developers in preparing

proposals and supporting documents for Single Family Housing loans, in

addition to specific requirements made in this subpart.

(2) Environmental review.

(i) An individual Single Family Housing loan is normally considered

a Categorical Exclusion under the National Environmental Policy Act

(NEPA). However, Form FmHA 1940-22, ``Environmental Checklist for

Categorical Exclusions,'' must be completed by the Agency to determine

that the specific action complies not only with NEPA, but also with

other applicable environmental laws, executive orders, and regulations.

To complete the form, the preparer will use reliable environmental

information. Sources of such information include, but are not limited

to, the State's Natural Resource Management Guide and the appraisal. If

the completed Form FmHA 1940-22 indicates a potential impact to one or

more environmental resources, the action is subject to disqualification

as Categorical Exclusion and a Class I assessment must be completed in

accordance with Sec. 1940.317(g) of subpart G of Part 1940 of this

chapter. If it is obvious at the outset that the action will be

disqualified as a Categorical Exclusion, the preparer should forego

completion of Form FmHA 1940-22 and proceed directly to the Class I

assessment.

(ii) If it appears that an action will be subject to

disqualification as a Categorical Exclusion due to indications of

cumulative impacts, a Class I or Class II assessment will be completed,

as appropriate, in accordance with subpart G of Part 1940 of this

chapter. A cumulative impact is the impact on the environment which

results from the incremental impact of the proposed action, when added

to other past, present and reasonably foreseeable future actions,

regardless of what Agency (Federal or non-Federal) or person undertakes

such other actions.

(c) Multiple Family Housing. Exhibit C of this subpart should be

used as a guide by the applicant or developer in preparing a proposal

and supporting documents for Multiple Family Housing projects. Exhibit

B of this subpart contains site development design requirements which

apply to all Multiple Family Housing projects.

Sec. 1924.106 Location.

(a) General. It is the Agency's policy to promote compact community

development and not to approve sites located in floodplains, on

wetlands, or on important farmlands, unless there is no practical

alternative. Furthermore, the Agency will not accept locations that

adversely affect properties which are listed or are eligible for

listing on the National Register of Historic Places, located within the

Coastal Barrier Resource System, or on a barrier island. In order to be

eligible for Agency participation:

(1) The site must be located in an eligible area as defined in the

program regulations under which the development is being funded or

approved.

(2) The proposal must comply with the applicable environmental

laws, Executive Orders, and subpart G of part 1940 of this chapter.

(b) Single Family Housing. In addition to the general requirements

in paragraph (a) of this section, sites must provide a desirable, safe,

functional, convenient, and attractive living environment for the

residents, and insure long-term market demand and acceptability.

(c) Multiple Family Housing. Multiple family housing projects shall

be located in accordance with the requirements in paragraph (r) of

Sec. 1944.215 of subpart E of part 1944 of this chapter. Locating sites

in less than desirable locations of the community or in close proximity

to undesirable influences such as railroad tracks, cemeteries; adjacent

to or behind commercial sites; bordering structures which are not

decent, safe, or sanitary or a positive conducive influence on the

proposed site; bordering sites which have potential environmental

concerns such as processing plants, etc., is not acceptable. Screening

such sites does not make them acceptable. Sites which are not an

integral part of a residential community and do not have a reasonable

access, either by location or terrain, to essential community

facilities such as water, sewerage, schools, shopping, employment

opportunities, medical facilities, etc., are equally not acceptable.

Sec. 1924.107 Utilities.

All development under this subpart must have adequate, economic,

safe, energy efficient, dependable utilities with sufficient easements

for installation and maintenance.

(a) Water and wastewater disposal systems.

(1) Single Family Housing. If sites are served by central water or

sewer systems the systems must meet the requirements of paragraphs

(a)(2) (i) and (ii) of this section. If sites have individual water or

sewer systems they must meet the requirements for water and sewerage in

Exhibit B, paragraphs V and VI of this subpart. Sites in subdivisions

of more than 25 dwelling units on individual systems, or sites that do

not meet the requirements of Exhibit B, paragraphs V and VI of this

subpart, must have State Director concurrence.

(2) Multiple Family Housing. Proposals processed under this

paragraph shall be served by centrally owned and operated water and

wastewater disposal systems unless this is determined to be

economically or environmentally unfeasible. All central systems,

whether they are public, community or private, shall meet the design

requirements of the State Department of Health or other comparable

reviewing and regulatory authority(ies). The regulatory authority(ies)

will verify in writing that the water and wastewater systems are in

compliance with the current provisions of the Safe Drinking Water Act

and the Clean Water Act, respectively.

(i) Sites which are not presently served by a central system, but

are scheduled for tie-in to the central system within 2 years should

have all lines installed during the initial construction. Such

developments must have an approved interim water supply or wastewater

disposal system installed capable of satisfactory service until the

scheduled tie-in occurs.

(ii) In addition to written assurance of compliance with State and

local requirements, there must be assurance of continuous service at

reasonable rates for central water and wastewater disposal systems.

Public ownership is preferred whenever possible. In cases where interim

facilities are installed pending extension or construction of permanent

public services, the developer must assume responsibility for the

operation and maintenance of the interim facility or establish an

entity for its operation and maintenance which is acceptable to the

local governing body. If a system is not or will not be publicly owned

and operated, it must comply with one of the following:

(A) Be an organization that meets the ownership and operating

requirements for a water or wastewater disposal system that the Agency

could finance under subpart A of part 1942 of this chapter or be

dedicated to and accepted by such an organization.

(B) Be an organization or individual that meets other acceptable

methods of ownership and operation as outlined in HUD Handbook 4075.12,

``Ownership and Organization of Central Water and Sewerage Systems.''

The Agency should be assured that the organization has the right, in

its sole discretion, to enforce the obligation of the operator of the

water and/or sewerage systems to provide satisfactory continuous

service at reasonable rates. The advice and assistance of the Regional

Attorney should be obtained in preparing any necessary agreement with

the organization or individual supplying water and/or sewerage systems.

(C) Be adequately controlled as to rates and services by a public

body (unit of Government or public services commission).

(iii) When central systems are not available, the Agency will

thoroughly evaluate the proposed individual systems for economic

feasibility and potential impact on the environment. Information and

guidance for evaluation and design of individual water and wastewater

systems is contained in Environmental Protection Agency (EPA)

publications ``Manual of Individual Water Supply Systems'' and ``Design

Manual, Onsite Wastewater Treatment and Disposal Systems'',

respectively. Developments of more than 25 dwelling units with

individual systems must have the National Office concurrence. A request

for concurrence must contain written recommendations and the following:

(A) Information prepared by the local, county or State regulatory

authority having jurisdiction indicating whether individual systems are

feasible on the proposed sites. Supporting factual data should include

evidence that clearly shows that individual systems will perform

satisfactorily for a reasonable period of time with reasonable

maintenance cost. Reasonable time and reasonable cost can be equated

with the cost and expected life of a central system if one were

available.

(B) Supporting information for the proposed individual water

systems, covering the following points:

(1) Documentation of how individual water supplies can be developed

with satisfactory water production at a reasonable cost. In areas where

difficulty is anticipated in developing an acceptable water supply, the

availability of a water supply will be determined before closing the

loan.

(2) Documentation that the quality of the supply meets the

chemical, physical and bacteriological standards of the regulatory

authority having jurisdiction. The maximum contaminant levels of U.S.

EPA shall apply. Individual water systems must be tested for quantity

and bacteriological quality. Where problems are anticipated with

chemical quality, chemical tests may be required. Chemical tests would

be limited to analysis for the defects common to the area such as iron

and manganese, hardness, nitrates, pH, turbidity, color, or other

undesirable elements. Polluted or contaminated water supplies are

unacceptable. In all cases, assurance of a potable water supply before

loan closing is required.

(C) Supporting information for individual wastewater disposal

systems with subsurface discharge provided by a soil scientist,

geologist, soils engineer, or other person recognized by the local

regulatory authority. This data should include the following:

(1) Assurance of nonpollution of ground water. The local regulatory

authority having jurisdiction must be consulted to ensure that

installation of individual wastewater systems will not pollute ground

water sources or create other health hazards/or otherwise violate State

water quality standards.

(2) Records of percolation tests. Guidance for performing these

tests is included in the EPA design manual, ``Onsite Wastewater

Treatment and Disposal Systems.'' (This may be waived by the State

Director when the State has established other acceptable means for

allowing onsite disposal.)

(3) Determination of soil types and description. The assistance of

the SCS or other qualified persons should be obtained for soil type

determination and a copy of its recommendations included in the

documentation.

(4) Description of ground water elevations, showing seasonal

variations.

(5) Confirmation of space allowances. An accurate drawing to

indicate that there is adequate space available to satisfactorily

locate the individual water and/or wastewater disposal systems;

likewise, documented assurance of compliance with all local

requirements. Structures served by wastewater disposal systems with

subsurface discharge require larger sites than those structures served

by another type system.

(6) Description of exploratory pit observations, if available.

(D) Supporting information for individual wastewater disposal

systems with surface discharge covering the following points:

(1) Effluent standards issued by the appropriate regulatory agency

that controls the discharge of the proposed individual systems.

Assurance from this regulatory agency that the effluent standards will

not be exceeded by the individual systems being proposed.

(2) Program of maintenance, parts and service available to the

system-owner for upkeep of the system.

(3) A plan for local inspection of the system by a responsible

agency with the authority to ensure compliance with health and safety

standards.

(b) Electric service. The power supplier will be consulted by the

applicant to assure that there is adequate service available to meet

the needs of the proposed development. Underground service is

preferred.

(c) Gas service. Gas distribution facilities, if provided, will be

installed according to local requirements where adequate and dependable

gas service is available.

(d) Other utilities. Other utilities, if available, will be

installed according to local requirements.

Sec. 1924.108 Grading and drainage.

(a) General. Soil and geologic conditions must be suitable for the

type of construction proposed. In questionable or unsurveyed areas, the

applicant or developer will provide an engineering report with

supporting data sufficient to identify all pertinent subsurface

conditions which could adversely affect the structure and show proposed

solutions. Grading will promote drainage of surface water away from

buildings and foundations, minimize earth settlement and erosion, and

assure that drainage from adjacent properties onto the development or

from the development to adjacent properties does not create a health

hazard or other undesirable conditions. Grading and drainage will

comply with Exhibit B, paragraphs III and IV, of this subpart.

(b) Cuts and fills. Development requiring extensive earthwork, cuts

and fills of 4 feet or more shall be designed by a duly licensed or

registered engineer. Where topography requires fills or extensive

earthwork that must support structures and building foundations, these

must be controlled fills designed, supervised and tested by a qualified

soils engineer.

(c) Slope protection. All slopes must be protected from erosion by

planting or other means. Slopes may require temporary cover if exposed

for long periods during construction.

(d) Storm water systems. The design of storm water systems must

consider convenience and property protection both at the individual

site level and the drainage basin level. Storm water systems should be

compatible with the natural features of the site. In areas with

inadequate natural and/or man-made drainage systems, permanent and/or

temporary storm water storage shall be an integral part of the overall

development plan. Design of these facilities shall consider safety,

appearance and economical maintenance operations.

Secs. 1924.109-1924.114 [Reserved]

Sec. 1924.115 Single Family Housing site evaluation.

(a) Site review. The site approval official will evaluate each site

(developed or undeveloped) to determine acceptance for the program.

Information on the site will be provided by the appraiser on a form

provided by the Agency and available in any Agency office. The review

appraiser and/or the site approval official will review the

information, complete any required information, and sign the back of

the form. If the site is new construction in a subdivision, the builder

will provide Form HUD-92541, ``Builder's Certification of Plans,

Specifications, and Site'', available in any Agency office. The site

approval official must complete the proper environmental review

required by subpart G of part 1940 of this chapter for each site. (See

Sec. 1924.105(b)(2) of this subpart.)

(b) Site access. Each site must be contiguous to and have direct

access from:

(1) A hard surfaced or all weather street or road which is

developed in full compliance with public body requirements, dedicated

for public use, and is being maintained by a public body or a Home

Owners Association that has demonstrated its ability or can clearly

demonstrate its ability to maintain the street, or

(2) An all weather extended driveway which can serve no more than

two sites connecting to a hard surface or all weather street or road

that meets the requirements of the above paragraph, or

(3) A hard surfaced street in a condominium or townhouse complex

which:

(i) Is owned in common by the members or a member association and

is maintained by a member association that has demonstrated its ability

or can clearly demonstrate its ability to maintain the street, and

(ii) Connects to a publicly owned and dedicated street or road.

(c) Exceptions to street requirements. A site not meeting the

conditions in paragraph (b) of this section will be acceptable if:

(1) The applicant is a builder for a conditional commitment (a loan

will not be approved until the site meets the conditions in paragraph

(b) of this section), or the builder posts an irrevocable performance

and payment bond (or similar acceptable assurance) that assures the

site approval official that the site will be developed to meet the

conditions in paragraph (b) of this section, or

(2) The site is recommended by the site approval official and

approved by the State Director. A request for State Director approval

must justify that it is in the best interest of both the government and

the applicant to approve the site.

(d) Site layout. (1) Sites shall be surveyed and platted. Permanent

markers shall be placed at all corners.

(2) Sites shall meet all requirements of State and local entities

and the Agency.

(e) Covenants, conditions and restrictions. Sites in subdivisions

shall be protected by covenants, conditions and restrictions (CC&Rs) to

preserve the character, value and amenities of the residential

community and to avoid or mitigate potential environmental impacts

unless, an exception is granted by the State Director after considering

the suitability of local ordinances, zoning, and other land use

controls.

(1) CC&Rs shall be recorded in the public land records and

specifically referenced in each deed.

(2) The intent of the CC&Rs is to assure the developers that the

purchasers will use the land in conformance with the planned objectives

for the community. In addition, the CC&Rs should assure the purchasers

that the developers will proceed to use the land as planned and that

other purchasers will use and maintain the land as planned to prevent

changes in the character of the neighborhood that would adversely

impact values or create a nuisance.

Secs. 1924.116-1924.119 [Reserved]

Sec. 1924.120 Approval authority.

The State Director is responsible for delegating Single Family

Housing site review and approval authority to appropriate employees

when the employees have had sufficient training and have demonstrated

the capability to perform the required actions, delegation is in

writing in accordance with FmHA Instruction 2006-F.

Sec. 1924.121 [Reserved]

Sec. 1924.122 Exception authority.

The Administrator may in individual cases, make an exception to any

requirement or provision of this subpart or address any omission of

this subpart which is not inconsistent with the authorizing statute or

other applicable law if the Administrator determines that application

of the requirement or provision would adversely affect the Government's

interest. The Administrator will exercise this authority upon the

written request of the State Director or the appropriate program

Assistant Administrator. Requests for exceptions must be supported with

documentation to explain the adverse effect on the Government, proposed

alternative courses of action, and show how the adverse effect will be

eliminated or minimized if the exception is granted.

Sec. 1924.123 State supplements and exhibits.

(a) State supplements. State Directors may supplement this subpart

only to meet State and local laws and regulations and to provide for

orderly processing of submittals.

(b) State exhibits. State Directors may develop exhibits for use by

applicants or developers if the exhibits to this subpart are not

adequate for use in the State. Those exhibits may be developed to

further explain the items needed within the various submittals;

organization of those items; and coordination of this subpart with the

requirements of the Agency program(s) providing the financial

assistance.

Sec. 1924.124-1924.149 [Reserved]

Sec. 1924.150 OMB control number.

3. Exhibit A of subpart C is removed and reserved.

Dated: June, 14, 1994.

Bob J. Nash,

Under Secretary for Small Community and Rural Development.

[FR Doc. 94-20432 Filed 8-18-94; 8:45 am]

BILLING CODE 3410-07-U