Performance Funding System: Unit Months Available

[[Page 24597]]

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of the Assistant Secretary for Public and Indian Housing

24 CFR Parts 950 and 990

[Docket No. R-95-1783; FR-3747-P-01]

RIN 2577-AB47

Performance Funding System: Unit Months Available

AGENCY: Office of the Assistant Secretary for Public and Indian

Housing, HUD.

ACTION: Proposed rule.

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SUMMARY: The Department is proposing to revise the Performance Funding

System to permit payment of operating subsidies for scattered-site

units as they become occupied.

DATES: Comments due date: July 10, 1995.

ADDRESSES: Interested persons are invited to submit written comments

regarding this proposed rule to the Office of the General Counsel,

Rules Docket Clerk, Room 10276, Department of Housing and Urban

Development, 451 Seventh Street, S.W., Washington, D.C. 20410. Comments

should refer to the above docket number and title. A copy of each

comment submitted will be available for public inspection and copying

between 7:30 a.m. and 5:30 p.m. at the above address. Facsimile (FAX)

comments are not acceptable.

FOR FURTHER INFORMATION CONTACT: Mr. John T. Comerford, Director,

Financial Management Division, Office of Management Operations, Public

and Indian Housing, Room 4212, Department of Housing and Urban

Development, 451 Seventh Street, S.W., Washington D.C. 20410, telephone

(202) 708-1872; or with respect to the Indian Housing programs, Ms.

Joann A. Teiken, Financial Management Specialist, Office of Native

American Programs, Public and Indian Housing, Room B-133, Department of

Housing and Urban Development, 451 Seventh Street, S.W., Washington

D.C. 20410, telephone (202) 708-2980. Hearing or speech impaired

individuals may call HUD's TDD number, (202) 708-0850. (These telephone

numbers are not toll-free.)

SUPPLEMENTARY INFORMATION: HUD's current policy provides that

eligibility for operating subsidy depends on the date of the End of

Initial Operating Period (EIOP), and the subsidy is payable for the

project as a whole, not on the basis of individual units. Any operating

deficit prior to EIOP is chargeable to the Development Cost Budget,

thereby reducing funds available for other development costs. This

procedure is founded on practices historically used in large, multi-

unit apartment projects, but is not necessarily appropriate to projects

involving acquisition of existing, scattered site units.

This proposed rule would revise the definition of Unit Months

Available (Secs. 950.102 and 990.102) and provide an explanation of the

alternate method for calculating unit months available upon acquisition

of units in a scattered site project (Secs. 950.705 and 990.104(b)).

This change in procedure would be made applicable to scattered site

developments acquired by Indian Housing Authorities.

Findings and Certifications

The subject matter of this proposed rule is categorically excluded

from HUD's environmental clearance procedures under 24 CFR 50.20(k). It

relates to internal administrative procedures whose content does not

constitute a development decision or affect the physical condition of

project areas or building sites.

Regulatory Flexibility Act

The Secretary, in accordance with the Regulatory Flexibility Act (5

U.S.C. 605(b)), has reviewed this proposed rule before publication and

by approving it certifies that this proposed rule does not have a

significant economic impact on substantial number of small entities.

The proposed rule would recognize that homes that are part of

scattered-site developments become ready for occupancy at varying

times, and would remove a potential penalty to housing authorities who

would otherwise have to wait for all units in a scattered-site

development to be occupied before they can receive subsidy.

Executive Order 12612, Federalism

The General Counsel, as the Designated Official under section 6(a)

of Executive Order 12612, Federalism, has determined that the policies

contained in this proposed rule would not have federalism implications

and, thus, are not subject to review under the Order. The proposed rule

would refine an established formula under which HUD calculates

operating subsidies for low-income housing developments, but contains

no requirement for explicit action by local officials and would not

interfere with State or local governmental functions.

Executive Order 12606

The General Counsel, as the Designated Official under Executive

Order 12606, The Family, has determined that this proposed rule would

not have potential significant impact on family formation, maintenance,

and general well-being, and, thus, is not subject to review under the

Order. No significant change in existing HUD policies or programs will

result from promulgation of this proposed rule, as those policies and

programs relate to family concerns.

Regulatory Agenda

This proposed rule was listed as item 1881 in the Department's

Semiannual Agenda of Regulations published on November 14, 1994 (59 FR

57632, 57670) in accordance with Executive Order 12866 and the

Regulatory Flexibility Act.

The Catalog of Federal Domestic Assistance number is 14.850.

List of Subjects

24 CFR Part 950

Aged, Grant programs--housing and community development, Grant

programs--Indians, Indians, Individuals with disabilities, Low and

moderate income housing, Public housing, Reporting and recordkeeping

requirements.

24 CFR Part 990

Grant programs--housing and community development, Public housing,

Reporting and recordkeeping requirements.

Accordingly, in title 24 of the Code of Federal Regulations, parts

950 and 990 would be amended, as follows:

PART 950--INDIAN HOUSING PROGRAMS

1. The authority citation for part 950 would continue to read as

follows:

Authority: 25 U.S.C. 405e(b), 1437aa-1437ee, and 3535(d).

2. Section 950.102 would be amended by revising the definition of

``Unit months available'', to read as follows:

Sec. 950.102 Definitions.

* * * * *

Unit months available. Units multiplied by the number of months the

project units are available for occupancy during a given IHA fiscal

year. See also Sec. 950.705(b).

* * * * *

3. The existing text in Sec. 950.705 would be redesignated as

paragraph (a), and a new paragraph (b) would be added, to read as

follows:

Sec. 950.705 Determination of amount of operating subsidy under PFS.

* * * * * [[Page 24598]]

(b) For purposes of this part, a unit is considered available for

occupancy from the date on which the End of Initial Operating Period

(EIOP) is established for the project with which it is associated until

the time it is approved by HUD for deprogramming and is vacated or is

approved for non-dwelling use, except that, on or after July 1, 1991, a

unit shall not be considered available for occupancy in any IHA

Requested Budget Year if the unit is located in a vacant building in a

project that HUD has determined to be nonviable. In the case of an IHA

development involving the acquisition of scattered site housing, the

IHA may submit, and HUD shall review and can approve, a revised

Development Cost Budget reflecting the number of units that were

occupied during the previous six months, and the Unit Months Available

used in the calculation of operating subsidy eligibility shall be

revised to include the number of months the new/acquired units are

actually occupied.

PART 990--ANNUAL CONTRIBUTIONS FOR OPERATING SUBSIDY

4. The authority citation for part 990 would continue to read as

follows:

Authority: 42 U.S.C. 1437g and 3535(d).

5. Section 990.102 would be amended by revising the definition of

``Unit Months Available'', to read as follows:

Sec. 990.102 Definitions.

* * * * *

Unit months available. Units multiplied by the number of months the

project units are available for occupancy during a given PHA fiscal

year. See also Sec. 990.104(b).

* * * * *

6. In Sec. 990.104, paragraph (b) would be revised, to read as

follows:

Sec. 990.104 Determination of amount of operating subsidy under PFS.

* * * * *

(b) For purposes of this part, a unit is considered available for

occupancy from the date on which the End of Initial Operating Period

(EIOP) is established for the project with which it is associated until

the time it is approved by HUD for deprogramming and is vacated or is

approved for non-dwelling use, except that, on or after July 1, 1991, a

unit shall not be considered available for occupancy in any PHA

Requested Budget Year if the unit is located in a vacant building in a

project that HUD has determined to be nonviable. In the case of a PHA

development involving the acquisition of scattered site housing, the

PHA may submit, and HUD shall review and can approve, a revised

Development Cost Budget reflecting the number of units that were

occupied during the previous six months, and the Unit Months Available

used in the calculation of operating subsidy eligibility shall be

revised to include the number of months the new/acquired units are

actually occupied.

Dated: March 24, 1995.

Joseph Shuldiner,

Assistant Secretary for Public and Indian Housing.

[FR Doc. 95-11372 Filed 5-8-95; 8:45 am]

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