Disclosure and Verification of Social Security Numbers and Employer Identification Numbers, and Procedures for Obtaining Income Information; Streamlining Final Rule

SUMMARY: This final rule amends HUD's regulations for the disclosure

and verification of social security numbers and employer identification

numbers, and procedures for obtaining income information. In an effort

to comply with the President's regulatory reform initiatives, this rule

will streamline these regulations as they exist in several parts by

eliminating provisions that are redundant and are otherwise

unnecessary. In addition, this final rule consolidates these

regulations into 24 CFR part 5 and updates the rule with new statutory

references.

EFFECTIVE DATE: April 17, 1996.

FOR FURTHER INFORMATION CONTACT: Camille Acevedo, Assistant General

Counsel for Regulations, Room 10276, Department of Housing and Urban

Development, 451 Seventh Street, SW, Washington, DC 20410, telephone

number (202) 708-2084 (this is not a toll-free number). For hearing- or

speech-impaired persons, this number may be accessed via TDD by calling

the Federal Information Relay Service at 1-800-877-8339.

SUPPLEMENTARY INFORMATION: On March 4, 1995, President Clinton issued a

memorandum to all Federal departments and agencies regarding regulatory

reinvention. In response to this memorandum, HUD conducted a page-by-

page review of its regulations to determine which can be eliminated,

consolidated, or otherwise improved. HUD has determined that the

regulations for the disclosure and verification of social security

numbers and employer identification numbers and the procedures for

obtaining income information can be improved and streamlined by

eliminating unnecessary provisions.

Several provisions in the regulations apply to more than one

program, and therefore HUD repeated these provisions in different

subparts. This repetition is unnecessary, and updating these scattered

provisions is cumbersome and often creates confusion. Therefore, this

final rule will consolidate these duplicative provisions, maintaining

appropriate cross-references for the reader's convenience. In

accomplishing this consolidation, this final rule also updates cross-

references to applicable program regulations, some of which have

changed as a result of other rules that have reinvented HUD's

regulations.

Several provisions also repeated statutory language from section

165 of the Housing and Community Development Act of 1987 (42 U.S.C.

3543) and section 904 of the Stewart B, McKinney Homeless Assistance

Amendments Act of 1988 (42 U.S.C. 3544). It is unnecessary to maintain

statutory requirements in the Code of Federal Regulations (CFR), since

those requirements are otherwise fully accessible and binding.

Furthermore, if regulations contain statutory language, HUD must amend

the regulations whenever Congress amends the statute. Therefore, this

final rule will remove repetitious statutory language and replace it

with a citation to the specific statutory section for easy reference.

Finally, this rule includes updated references to income

information obtained pursuant to statutory authority through computer

matches with other Federal agencies. These references merely reflect

existing authority and responsibilities that were not otherwise

acknowledged in the regulations.

Justification for Final Rulemaking

HUD generally publishes a rule for public comment before issuing a

rule for effect, in accordance with its own regulations on rulemaking

in 24 CFR part 10. However, part 10 provides for exceptions to the

general rule if the agency finds good cause to omit advance notice and

public participation. The good cause requirement is satisfied when

prior public procedure is ``impracticable, unnecessary, or contrary to

the public interest'' (24 CFR 10.1). HUD finds that good cause exists

to publish this rule for effect without first soliciting public

comment. This rule merely removes unnecessary regulatory provisions and

reflects existing authority and responsibilities; the rule does not

establish or affect substantive policy. Therefore, prior public comment

is unnecessary.

Other Matters

Regulatory Flexibility Act

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

U.S.C. 605(b)), has reviewed and approved this final rule, and in so

doing certifies that this rule will not have a significant economic

impact on a substantial number of small entities. This rule merely

streamlines regulations by removing unnecessary provisions. The rule

will have no adverse or disproportionate economic impact on small

businesses.

Environmental Impact

This rulemaking does not have an environmental impact. This

rulemaking simply amends existing regulations by consolidating and

streamlining provisions and does not alter the environmental effect of

the regulations being amended. Findings of No Significant Impact with

respect to the environment were made in accordance with HUD regulations

in 24 CFR part 50 that implement section 102(2)(C) of the National

Environmental Policy Act of 1969 (42 U.S.C. 4332) at the time of

development of regulations implementing the statutory requirements (see

Docket Nos. FR-2501; FR-2588; FR-2854; and FR-2974). Those findings

remain applicable to this rule, and are available for public inspection

between 7:30 a.m. and 5:30 p.m. weekdays in the Office of the Rules

Docket Clerk, Office of General Counsel, Room 10276, Department of

Housing and Urban Development, 451 Seventh Street, SW, Washington, DC.

Executive Order 12612, Federalism

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

of Executive Order 12612, Federalism, has determined that this rule

will not have substantial direct effects on States or their political

subdivisions, or the relationship between the Federal government and

the States, or on the distribution of power and responsibilities among

the various levels of government. No programmatic or policy changes

will result from this rule that would affect the relationship between

the Federal Government and State and local governments.

Executive Order 12606, The Family

The General Counsel, as the Designated Official under Executive

Order 12606, The Family, has determined that this rule will not have

the potential for significant impact on family formation, maintenance,

or 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 rule.

[[Page 11113]]

List of Subjects

24 CFR Part 5

Administrative practice and procedure, Aged, Claims, Drug abuse,

Drug traffic control, Grant programs--housing and community

development, Grant programs--Indians, Grant programs--low and moderate

income housing, Indians, Individuals with disabilities,

Intergovernmental relations, Loan programs--housing and community

development, Low and moderate income housing, Mortgage insurance,

Penalties, Pets, Public housing, Rent subsidies, Reporting and

recordkeeping requirements, Social security, Unemployment compensation,

Wages.

24 CFR Part 200

Administrative practice and procedure, Claims, Equal employment

opportunity, Fair housing, Home improvement, Housing standards,

Incorporation by reference, Lead poisoning, Loan programs--housing and

community development, Minimum property standards, Mortgage insurance,

Organization and functions (Government agencies), Penalties, Reporting

and recordkeeping requirements, Social security, Unemployment

compensation, Wages.

24 CFR Part 247

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

housing and community development, Low and moderate income housing,

Rent subsidies.

24 CFR Part 572

Condominiums, Cooperatives, Fair housing, Government property,

Grant programs--housing and community development, Low and moderate

income housing, Nonprofit organizations, Reporting and recordkeeping

requirements.

24 CFR Part 750

Grant programs--housing and community development, Indians,

Intergovernmental relations, Loan programs--housing and community

development, Public housing, Rent subsidies, Reporting and

recordkeeping requirements, Social security.

24 CFR Part 760

Grant programs--housing and community development, Income

verification procedures, Indians, Intergovernmental relations, Loan

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

Rent subsidies, Reporting and recordkeeping requirements, Wages.

24 CFR Part 882

Grant programs--housing and community development, Homeless, Lead

poisoning, Manufactured homes, Rent subsidies, Reporting and

recordkeeping requirements.

24 CFR Part 886

Grant programs--housing and community development, Lead poisoning,

Rent subsidies, Reporting and recordkeeping requirements.

24 CFR Part 887

Grant programs--housing and community development, Rent subsidies,

Reporting and recordkeeping requirements.

24 CFR Part 913

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

Reporting and recordkeeping requirements.

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 960

Aged, Grant programs--housing and community development,

Individuals with disabilities, Public housing.

24 CFR Part 982

Grant programs--housing and community development, Housing, Rent

subsidies, Reporting and recordkeeping requirements.

24 CFR Part 983

Grant programs--housing and community development, Rent subsidies,

Reporting and recordkeeping requirements.

For the reasons set out in the preamble, under the authority of 42

U.S.C. 3535(d), title 24 of the Code of Federal Regulations is amended

by amending parts 5, 200, 247, 572, 882, 886, 887, 913, 950, 960, 982,

and 983, and by removing parts 750 and 760, as follows:

PART 5--GENERAL HUD PROGRAM REQUIREMENTS; WAIVERS

1. The authority citation for part 5 is revised to read as follows:

Authority: 12 U.S.C. 101r-1; 42 U.S.C. 3535(d), 3543, 3544, and

11901 et seq.

2. A new subpart B is added to read as follows:

Subpart B--Disclosure and Verification of Social Security Numbers and

Employer Identification Numbers; Procedures for Obtaining Income

Information

Sec.

5.210 Purpose, applicability, and Federal preemption.

5.212 Compliance with the Privacy Act and other requirements.

5.214 Definitions.

Disclosure and Verification of Social Security Numbers and Employer

Identification Numbers for Applicants and Participants in Certain HUD

Programs

5.216 Disclosure and verification of Social Security and Employer

Identification Numbers.

5.218 Penalties for failing to disclose and verify Social Security

and Employer Identification Numbers.

Procedures for Obtaining Income Information About Applicants and

Participants

5.230 Consent by assistance applicants and participants.

5.232 Penalties for failing to sign consent forms.

5.234 Requests for information from SWICAs and Federal agencies;

restrictions on use.

5.236 Procedures for termination, denial, suspension, or reduction

of assistance based on information obtained from a SWICA or Federal

agency.

5.238 Criminal and civil penalties.

Subpart B--Disclosure and Verification of Social Security Numbers

and Employer Identification Numbers; Procedures for Obtaining

Income Information

Sec. 5.210 Purpose, applicability, and Federal preemption.

(a) Purpose. This subpart B requires applicants for and

participants in covered HUD programs to disclose, and submit

documentation to verify, their Social Security Numbers (SSNs). This

subpart B also enables HUD and HAs to obtain income information about

applicants and participants in the covered programs through computer

matches with State Wage Information Collection Agencies (SWICAs) and

Federal agencies, in order to verify an applicant's or participant's

eligibility for or level of assistance. The purpose of this subpart B

is to enable HUD to decrease the incidence of fraud, waste, and abuse

in the covered programs.

(b) Applicability. (1) This subpart B applies to mortgage and loan

insurance and coinsurance and housing assistance programs contained in

chapter II, subchapter B, and chapters VIII and IX of this title.

(2) The information covered by consent forms described in this

subpart involves income information from SWICAs, and wages, net

earnings from

[[Page 11114]]

self-employment, payments of retirement income, and unearned income as

referenced at 26 U.S.C. 6103. In addition, consent forms may authorize

the collection of other information from applicants and participants to

determine eligibility or level of benefits, as provided in parts 813

and 913 of this title.

(c) Federal preemption. This subpart B preempts any State law,

including restrictions and penalties, that governs the collection and

use of income information to the extent State law is inconsistent with

this subpart.

Sec. 5.212 Compliance with the Privacy Act and other requirements.

(a) Compliance with the Privacy Act. The collection, maintenance,

use, and dissemination of SSNs, EINs, any information derived from SSNs

and Employer Identification Numbers (EINs), and income information

under this subpart shall be conducted, to the extent applicable, in

compliance with the Privacy Act (5 U.S.C. 552a) and all other

provisions of Federal, State, and local law.

(b) Privacy Act notice. All assistance applicants shall be provided

with a Privacy Act notice at the time of application. All participants

shall be provided with a Privacy Act notice at each annual income

recertification.

Sec. 5.214 Definitions.

In addition to the definitions in Sec. 5.100, the following

definitions apply to this subpart B:

Assistance applicant. Except as excluded pursuant to 42 U.S.C.

3543(b) and 3544(a)(2), this term means the following:

(1) For any program under 24 CFR parts 215, 221, 236, 290, 880,

882, 886, 887, 891: A family or individual that seeks rental assistance

under the program.

(2) For any program under 24 CFR parts 904, 950, and 960: A

prospective tenant or homebuyer seeking the benefit of the program.

(3) For any program under 24 CFR part 235: A homeowner or

cooperative member seeking homeownership assistance (including where

the individual seeks to assume an existing mortgage).

Computer match means the automated comparison of data bases

containing records about individuals.

Computer matching agreement means the agreement that describes the

responsibilities and obligations of the parties participating in a

computer match.

Consent form means any consent form approved by HUD to be signed by

assistance applicants and participants for the purpose of obtaining

income information from employers and SWICAs; return information from

the Social Security Administration (including wages, net earnings from

self-employment, and payments of retirement income), as referenced at

26 U.S.C. 6103(l)(7)(A); and return information for unearned income

from the Internal Revenue Service, as referenced at 26 U.S.C.

6103(l)(7)(B). The consent forms expire after a certain time and may

authorize the collection of other information from assistance

applicants or participants to determine eligibility or level of

benefits as provided in Secs. 813.109, 913.109, and 950.315 of this

title.

Employer Identification Number (EIN) means the nine-digit taxpayer

identifying number that is assigned to an individual, trust, estate,

partnership, association, company, or corporation pursuant to sections

6011(b), or corresponding provisions of prior law, or 6109 of the

Internal Revenue Code.

Entity applicant. (1) Except as excluded pursuant to 42 U.S.C.

3543(b), 3544(a)(2), and paragraph (2) of this definition, this term

means a partnership, corporation, or any other association or entity,

other than an individual owner applicant, that seeks to participate as

a private owner in any of the following:

(i) The project-based assistance programs in 24 CFR parts 880, 882,

886, or 891;

(ii) The programs in 24 CFR parts 215, 221, or 236; or

(iii) The other mortgage and loan insurance programs in 24 CFR

parts 201 through 267, except that the term ``entity applicant'' does

not include a mortgagee or lender.

(2) The term does not include a public entity, such as a PHA, IHA,

or State Housing Finance Agency.

Federal agency means a department of the executive branch of the

Federal Government.

HA is the collective term for PHAs and IHAs.

Income information means information relating to an individual's

income, including:

(1) All employment income information known to current or previous

employers or other income sources that HUD or the processing entity

determines is necessary for purposes of determining an assistance

applicant's or participant's eligibility for, or level of assistance

in, a covered program;

(2) All information about wages, as defined in the State's

unemployment compensation law, including any Social Security Number;

name of the employee; quarterly wages of the employee; and the name,

full address, telephone number, and, when known, Employer

Identification Number of an employer reporting wages under a State

unemployment compensation law;

(3) With respect to unemployment compensation:

(i) Whether an individual is receiving, has received, or has

applied for unemployment compensation;

(ii) The amount of unemployment compensation the individual is

receiving or is entitled to receive; and

(iii) The period with respect to which the individual actually

received such compensation;

(4) Unearned IRS income and self-employment, wages and retirement

income as described in the Internal Revenue Code, 26 U.S.C. 6103(l)(7);

and

(5) Wage, social security (Title II), and supplemental security

income (Title XVI) data obtaied from the Social Security

Administration.

Individual owner applicant. Except as excluded pursuant to 42

U.S.C. 3543(b), 3544(a)(2), or paragraph (2) of this definition, this

term means:

(1) An individual who seeks to participate as a private owner in

any of:

(i) The project-based assistance programs in 24 CFR parts 880, 882,

886, 887, or 891; or

(ii) The programs in 24 CFR parts 215, 221, 235 (without

homeownership assistance), or 236, including where the individual seeks

to assume an existing mortgage; or

(2) An individual who:

(i) Either: (A) Applies for a mortgage or loan insured or coinsured

under any of the programs referred to in paragraph (1)(iii) of the

definition of ``entity applicant'' in this section; or

(B) Seeks to assume an existing mortgage or loan; and

(ii) Intends to hold the mortgaged property in his or her

individual right.

IRS means the Internal Revenue Service.

Owner means the person or entity (or employee of an owner) that

leases an assisted dwelling unit to an eligible family and includes,

when applicable, a mortgagee.

Participant. Except as excluded pursuant to 42 U.S.C. 3543(b) and

3544(a)(2), this term has the following meaning:

(1) For 24 CFR parts 880, 882, 886, 887, and 891: A family

receiving rental assistance under the program;

(2) For 24 CFR parts 904, 950, 960: A tenant or homebuyer under the

program;

(3) For 24 CFR parts 215, 221, 236, and 290: A tenant or qualified

tenant under any of the programs; and

[[Page 11115]]

(4) For 24 CFR part 235: A homeowner or a cooperative member

receiving homeownership assistance.

Processing entity means the person or entity that, under any of the

programs covered under this subpart B, is responsible for making

eligibility and related determinations and any income reexamination.

Social Security Number (SSN) means the nine-digit number that is

assigned to a person by the Social Security Administration and that

identifies the record of the person's earnings reported to the Social

Security Administration. The term does not include a number with a

letter as a suffix that is used to identify an auxiliary beneficiary.

SSA means the Social Security Administration.

State Wage Information Collection Agency (SWICA) means the State

agency, including any Indian tribal agency, receiving quarterly wage

reports from employers in the State, or an alternative system that has

been determined by the Secretary of Labor to be as effective and timely

in providing employment-related income and eligibility information.

Disclosure and Verification of Social Security Numbers and Employer

Identification Numbers for Applicants and Participants in Certain HUD

Programs

Sec. 5.216 Disclosure and verification of Social Security and Employer

Identification Numbers.

(a) Disclosure: assistance applicants. Each assistance applicant

must submit the following information to the processing entity when the

assistant applicant's eligibility under the program involved is being

determined:

(1)(i) The complete and accurate SSN assigned to the assistant

applicant and to each member of the assistant applicant's household who

is at least six years of age; and

(ii) The documentation referred to in paragraph (f)(1) of this

section to verify each such SSN; or

(2) If the assistance applicant or any member of the assistance

applicant's household who is at least six years of age has not been

assigned an SSN, a certification executed by the individual involved

that meets the requirements of paragraph (j) of this section.

(b) Disclosure: individual owner applicants. Each individual owner

applicant must submit the following information to the processing

entity when the individual owner applicant's eligibility under the

program involved is being determined:

(1)(i) The complete and accurate SSNs assigned to the individual

owner applicant and to each member of the individual owner applicant's

household who will be obligated to pay the debt evidenced by the

mortgage or loan documents; and

(ii) The documentation referred to in paragraph (f)(1) of this

section to verify the SSNs; or

(2) If any person referred to in paragraph (b)(1)(i) of this

section has not been assigned an SSN, a certification executed by the

individual involved that meets the requirements of paragraph (j) of

this section.

(c) Disclosure: certain officials of entity applicants. As

explained more fully in HUD administrative instructions, each officer,

director, principal stockholder, or other official of an entity

applicant must submit the following information to the processing

entity when the entity applicant's eligibility under the program

involved is being determined:

(1) The complete and accurate SSN assigned to each such individual;

and

(2) The documentation referred to in paragraph (f)(1) of this

section to verify each SSN.

(d) Disclosure: participants. (1) Initial disclosure. Each

participant whose initial determination of eligibility under the

program involved was begun before November 6, 1989, must submit the

following information to the processing entity at the next regularly

scheduled income reexamination for the program involved:

(i)(A) The complete and accurate SSN assigned to the participant

and to each member of the participant's family who is at least six

years of age; and

(B) The documentation referred to in paragraph (f)(1) of this

section to verify each such SSN; or

(ii) If the participant or any member of the participant's

household who is at least six years of age has not been assigned an

SSN, a certification executed by the individual(s) involved that meets

the requirements of paragraph (j) of this section.

(2) Subsequent disclosure. Once a participant has disclosed and

verified every SSN, or submitted any certification that an SSN has not

been assigned, as provided by paragraph (a) of this section (for an

assistance applicant) or paragraph (d)(1) (for a preexisting

participant) of this section, the following rules apply:

(i) If the participant's household adds a new member who is at

least six years of age, the participant must submit to the processing

entity, at the next interim or regularly scheduled income reexamination

that includes the new members:

(A) The complete and accurate SSNs assigned to each new member and

the documentation referred to in paragraph (f)(1) of this section to

verify the SSNs for each new member; or

(B) If the new member has not been assigned an SSN, a certification

executed by the individual involved that meets the requirements of

paragraph (j) of this section.

(ii) If the participant or any member of the participant's

household who is at least six years of age obtains a previously

undisclosed SSN, or has been assigned a new SSN, the participant must

submit the following to the processing entity at the next regularly

scheduled income reexamination:

(A) The complete and accurate SSN assigned to the participant or

household member involved; and

(B) The documentation referred to in paragraph (f)(1) of this

section to verify the SSN of each such individual.

(iii) Additional SSN disclosure and verification requirements,

including the nature of the disclosure and the verification required

and the time and manner for making the disclosure and verification, may

be specified in administrative instructions by:

(A) HUD; and

(B) In the case of the public housing program or the programs under

parts 882 and 887 of this title, the HA.

(e) Disclosure: entity applicants. Each entity applicant must

submit the following information to the processing entity when the

entity applicant's eligibility under the program involved is being

determined:

(1) Any complete and accurate EIN assigned to the entity applicant;

and

(2) The documentation referred to in paragraph (f)(2) of this

section to verify the EIN.

(f) Required documentation. (1) Social Security Numbers. The

documentation necessary to verify the SSN of an individual who is

required to disclose his or her SSN under paragraphs (a) through (d) of

this section is a valid SSN card issued by the SSA, or such other

evidence of the SSN as HUD and, where applicable, the HA may prescribe

in administrative instructions.

(2) Employer Identification Numbers. The documentation necessary to

verify any EIN of an entity applicant that is required to disclose its

EIN under paragraph (e) of this section is the official, written

communication from the IRS assigning the EIN to the entity applicant,

or such other evidence of the EIN as HUD may prescribe in

administrative instructions.

(g) Special documentation rules for assistance applicants and

participants.

[[Page 11116]]

(1) Certification of inability to meet documentation requirements. If

an individual who is required to disclose his or her SSN under

paragraph (a) (assistance applicants) of this section or paragraph (d)

(participants) of this section is able to disclose the SSN, but cannot

meet the documentation requirements of paragraph (f)(1) of this

section, the assistance applicant or participant must submit to the

processing entity the individual's SSN and a certification executed by

the individual that the SSN submitted has been assigned to the

individual, but that acceptable documentation to verify the SSN cannot

be provided.

(2) Acceptance or certification by processing entity. Except as

provided by paragraph (h) of this section, the processing entity must

accept the certification referred to in paragraph (g)(1) of this

section and continue to process the assistant applicant's or

participant's eligibility to participate in the program involved.

(3) Effect on assistance applicants. If the processing entity

determines that the assistance applicant is otherwise eligible to

participate in the program, the assistance applicant may not become a

participant in the program, unless it submits to the processing entity

the documentation required under paragraph (f)(1) of this section

within the time period specified in paragraph (g)(5) of this section.

During such period, the assistance applicant will retain the position

that it occupied in the program at the time the determination of

eligibility was made, including its place on any waiting list

maintained for the program, if applicable.

(4) Effect on participants. If the processing entity determines

that the participant otherwise continues to be eligible to participate

in the program, participation will continue, provided that the

participant submits to the processing entity the documentation required

under paragraph (f)(1) of this section within the time period specified

in paragraph (g)(5) of this section.

(5) Time for submitting documentation. The time period referred to

in paragraphs (g)(4) and (5) of this section is 60 calendar days from

the date on which the certification referred to in paragraph (g)(1) of

this section is executed, except that the processing entity may, in its

discretion, extend this period for up to an additional 60 days if the

individual is at least 62 years of age and is unable to submit the

required documentation within the initial 60-day period.

(h) Rejection of documentation or certification. The processing

entity may reject documentation referred to in paragraph (f) of this

section, or a certification provided under paragraphs (a)(2), (b)(2),

(d), or (g)(1) of this section, only for such reasons as HUD and the HA

may prescribe in applicable administrative instructions.

(i) Information on SSNs and EINs. (1) Information regarding SSNs

and SSN cards may be obtained by contacting the local SSA Office or

consulting the SSA regulations at 20 CFR chapter III (see,

particularly, part 422).

(2) Information regarding EINs may be obtained by contacting the

local office of the IRS or consulting the appropriate regulations for

the IRS.

(j) Form and manner of certifications. The certifications referred

to in paragraphs (a)(2), (b)(2), (d), and (g)(1) of this section must

be in the form and manner that HUD and the HA prescribe in applicable

administrative instructions. If an individual who is required to

execute a certification is less than 18 years of age, the certification

must be executed by his or her parent or guardian or, in accordance

with administrative instructions, by the individual or another person.

(Approved by the Office of Management and Budget under control

number 2502-0204.)

Sec. 5.218 Penalties for failing to disclose and verify Social

Security and Employer Identification Numbers.

(a) Denial of eligibility: assistance applicants and individual

owner applicants. The processing entity must deny the eligibility of an

assistance applicant or individual owner applicant in accordance with

the provisions governing the program involved, if the assistance or

individual owner applicant does not meet the applicable SSN disclosure,

documentation and verification, and certification requirements

specified in Sec. 5.216.

(b) Denial of eligibility: entity applicants. The processing entity

must deny the eligibility of an entity applicant in accordance with the

provisions governing the program involved; if:

(1) The entity applicant does not meet the applicable EIN

disclosure and verification requirements specified in Sec. 5.216; or

(2) Any of the officials of the entity applicant referred to in

Sec. 5.216(c) does not meet the applicable SSN disclosure, and

documentation and verification requirements specified in Sec. 5.216.

(c) Termination of assistance or tenancy: participants. The

processing entity must terminate the assistance or tenancy, or both, of

a participant, in accordance with the provisions governing the program

involved, if the participant does not meet the applicable SSN

disclosure, documentation and verification, and certification

requirements specified in Sec. 5.216.

(d) Cross reference. Individuals should consult the regulations and

administrative instructions for the programs covered under this subpart

B for further information on the use of SSNs and EINs in determinations

regarding eligibility.

Procedures for Obtaining Income Information About Applicants and

Participants

Sec. 5.230 Consent by assistance applicants and participants.

(a) Required consent by assistance applicants and participants.

Each member of the family of an assistance applicant or participant who

is at least 18 years of age, and each family head and spouse regardless

of age, shall sign one or more consent forms.

(b) Consent authorization. (1) To whom and when. The assistance

applicant shall submit the signed consent forms to the processing

entity when eligibility under a covered program is being determined. A

participant shall sign and submit consent forms at the next regularly

scheduled income reexamination. Assistance applicants and participants

shall be responsible for the signing and submitting of consent forms by

each applicable family member.

(2) Subsequent consent forms--special cases. Participants are

required to sign and submit consent forms at the next interim or

regularly scheduled income reexamination under the following

circumstances:

(i) When any person 18 years or older becomes a member of the

family;

(ii) When a member of the family turns 18 years of age; and

(iii) As required by HUD or the HA in administrative instructions.

(c) Consent form--contents. The consent form required by this

section shall contain, at a minimum, the following:

(1) A provision authorizing HUD and HAs to obtain from SWICAs any

information or materials necessary to complete or verify the

application for participation and to maintain continued assistance

under a covered program; and

(2) A provision authorizing HUD, HAs, or the owner responsible for

determining eligibility for or the level of assistance to verify with

previous or current employers income information pertinent to the

assistance applicant's or participant's eligibility for or level of

assistance under a covered program;

(3) A provision authorizing HUD to request income return

information from

[[Page 11117]]

the IRS and the SSA for the sole purpose of verifying income

information pertinent to the assistance applicant's or participant's

eligibility or level of benefits; and

(4) A statement that the authorization to release the information

requested by the consent form expires 15 months after the date the

consent form is signed.

Sec. 5.232 Penalties for failing to sign consent forms.

(a) Denial or termination of benefits. In accordance with the

provisions governing the program involved, if the assistance applicant

or participant, or any member of the assistance applicant's or

participant's family, does not sign and submit the consent form as

required in Sec. 5.230, then:

(1) The processing entity shall deny assistance to and admission of

an assistance applicant;

(2) Assistance to, and the tenancy of, a participant may be

terminated.

(b) Cross references. Individuals should consult the regulations

and administrative instructions for the programs covered under this

subpart B for further information on the use of income information in

determinations regarding eligibility.

Sec. 5.234 Requests for information from SWICAs and Federal agencies;

restrictions on use.

(a) Information available from SWICAs and Federal agencies--to whom

and what. Income information will generally be obtained through

computer matching agreements between HUD and a SWICA or Federal agency,

or between a HA and a SWICA, as described in paragraph (c) of this

section. Certification that the applicable assistance applicants and

participants have signed appropriate consent forms and have received

the necessary Privacy Act notice is required, as follows:

(1) When HUD requests the computer match, the processing entity

shall certify to HUD; and

(2) When the HA requests the computer match, the HA shall certify

to the SWICA.

(b) Restrictions on use of information. The restrictions of 42

U.S.C. 3544(c)(2)(A) apply to the use by HUD or a HA of income

information obtained from a SWICA. The restrictions of 42 U.S.C.

3544(c)(2)(A) and of 26 U.S.C. 6103(l)(7) apply to the use by HUD or a

HA of income information obtained from the IRS or SSA.

(c) Computer matching agreements. Computer matching agreements

shall specify the purpose and the legal authority for the match, and

shall include a description of the records to be matched, a statement

regarding disposition of information generated through the match, a

description of the administrative and technical safeguards to be used

in protecting the information obtained through the match, a description

of the use of records, the restrictions on duplication and

redisclosure, a certification, and the amount that will be charged for

processing a request.

(Approved by the Office of Management and Budget under control

number 2508-0008.)

Sec. 5.236 Procedures for termination, denial, suspension, or

reduction of assistance based on information obtained from a SWICA or

Federal agency.

(a) Termination, denial, suspension, or reduction of assistance.

The provisions of 42 U.S.C. 3544(c)(2)(B) and (C) shall govern the

termination, denial, suspension, or reduction of benefits for an

assistance applicant or participant based on income information

obtained from a SWICA or a Federal agency. Procedures necessary to

comply with these provisions are provided in paragraph (b) of this

section.

(b) Procedures for independent verification. (1) Any determination

or redetermination of family income made on the basis of information

verified in accordance with paragraph (b) of this section shall be

carried out in accordance with the requirements and procedures

applicable to the individual covered program. Independent verification

of information obtained from a SWICA or a Federal agency may be:

(i) By HUD; and

(ii) By a HA, when the benefit to be provided to the assistance

applicant or participant is under a program in parts 880, 882, 886,

887, 891, 904, 950, or 960 of this title, including when the HA is the

contract administrator for the owner.

(2) Upon receiving income information from a SWICA or a Federal

agency, HUD or, when applicable, the HA shall compare the information

with the information about a family's income that was:

(i) Provided by the assistance applicant or participant to the HA;

or

(ii) Obtained by the owner (or mortgagee, as applicable) from the

assistance applicant or participant or from his or her employer.

(3) When the income information reveals an employer or other income

source that was not disclosed by the assistance applicant or

participant, or when the income information differs substantially from

the information received from the assistance applicant or participant

or from his or her employer:

(i) HUD or, as applicable or directed by HUD, the HA shall request

the undisclosed employer or other income source to furnish any

information necessary to establish an assistance applicant's or

participant's eligibility for or level of assistance in a covered

program. This information shall be furnished in writing, as directed

to:

(A) HUD, with respect to programs under parts 215, 221, 235, 236,

or 290 of this title;

(B) The HA, with respect to programs under parts 880, 882, 886,

887, 891, 904, 950, or 960 of this title for which the HA is

responsible for determining eligibility or level of benefits; or

(C) The owner (or mortgagee, as applicable), with respect to

programs under parts 215, 221, 235, 236, or 290 of this title, or when

the owner is responsible under parts 880, 882, 886, 887, 891, 904, 950,

or 960 of this title for determining eligibility or the level of

assistance; or

(ii) HUD or the HA may verify the income information directly with

an assistance applicant or participant. Such verification procedures

shall not include any disclosure of income information prohibited under

paragraph (b)(6) of this section.

(4) HUD and the HA shall not be required to pursue these

verification procedures when the sums of money at issue are too small

to raise an inference of fraud or justify the expense of independent

verification and the procedures related to termination, denial,

suspension, or reduction of assistance.

(5) Based on the income information received from a SWICA or

Federal agency, HUD or the HA, as appropriate, may inform an owner (or

mortgagee) that an assistance applicant's or participant's eligibility

for or level of assistance is uncertain and needs to be verified. The

owner (or mortgagee) shall then confirm the assistance applicant's or

participant's income information by checking the accuracy of the

information with the employer or other income source, or directly with

the family.

(6) Nondisclosure of Income information. Neither HUD nor the HA may

disclose income information obtained from a SWICA directly to an owner

(unless a HA is the owner). Disclosure of income information obtained

from the SSA or IRS is restricted under 26 U.S.C. Sec. 6103(l)(7) and

42 U.S.C. 3544.

(c) Opportunity to contest. HUD, the HA, or the owner (or

mortgagee, as applicable) shall promptly notify any

[[Page 11118]]

assistance applicant or participant in writing of any adverse findings

made on the basis of the information verified in accordance with

paragraph (b) of this section. The assistance applicant or participant

may contest the findings in the same manner as applies to other

information and findings relating to eligibility factors under the

applicable program. Termination, denial, suspension, or reduction of

assistance shall be carried out in accordance with requirements and

procedures applicable to the individual covered program, and shall not

occur until the expiration of any notice period provided by the statute

or regulations governing the program.

Sec. 5.238 Criminal and civil penalties.

Persons who violate the provisions of 42 U.S.C. 3544 or 26 U.S.C.

6103(l)(7) with respect to the use and disclosure of income information

may be subject to civil or criminal penalties under 42 U.S.C.

3544(c)(3), 26 U.S.C. 7213(a), or 18 U.S.C. 1905.

PART 200 --INTRODUCTION

3. The authority citation for part 200 continues to read as

follows:

Authority: 12 U.S.C. 1701-1715z-18; 42 U.S.C. 1436a and 3535(d).

4. Part 200 is amended by revising subparts T, U, and V to read as

follows:

PART 200--INTRODUCTION

* * * * *

Subpart T--Social Security Numbers and Employer Identification

Numbers; Assistance Applicants and Participants

Sec. 200.1001 Cross-reference.

The provisions in subpart B of part 5 of this title apply to Social

Security Numbers and Employer Identification Numbers for assistance

applicants and participants.

Subpart U--Social Security Numbers and Employer Identification

Numbers; Applicants in Unassisted Programs

Sec. 200.1101 Cross-reference.

The provisions in subpart B of part 5 of this title apply to Social

Security Numbers and Employer Identification Numbers for applicants in

unassisted programs.

Subpart V--Income Information; Assistance Applicants and

Participants

Sec. 200.1201 Cross-reference.

The provisions in subpart B of part 5 of this title apply to income

information for assistance applicants and participants.

PART 247--EVICTIONS FROM CERTAIN SUBSIDIZED AND HUD-OWNED PROJECTS

5. The authority citation for part 247 continues to read as

follows:

Authority: 12 U.S.C. 1701q, 1701s, 1715b, 1715l, 1715z-1; 42

U.S.C. 1437a, 1437c, 1437f, 3535(d).

6. Section 247.3 is amended by revising paragraph (c)(3), to read

as follows:

Sec. 247.3 Entitlement of tenants to occupancy.

* * * * *

(c) * * *

(3) If the tenant:

(i) Fails to supply on time all required information on the income

and composition, or eligibility factors, of the tenant household, as

provided in part 200, subpart G, of this chapter and part 5, subpart B,

of this title; or

(ii) Knowingly provides incomplete or inaccurate information as

required under these provisions; and

* * * * *

PART 572--HOPE FOR HOMEOWNERSHIP OF SINGLE FAMILY HOMES PROGRAM

(HOPE 3)

7. The authority citation for part 572 continues to read as

follows:

Authority: 42 U.S.C. 3535(d) and 12891.

Subpart B--Homeownership Program Requirements--Implementation

Grants

Sec. 572.110 [Amended]

8. In Sec. 572.110, paragraphs (d) (1) and (2) are amended by

removing the references to ``24 CFR part 750'' and ``24 CFR part 760'',

and by adding in their places, ``part 5, subpart B, of this title'',

respectively.

PART 750--[REMOVED]

8a. Part 750 is removed.

PART 760--[REMOVED]

8b. Part 760 is removed.

PART 882--SECTION 8 HOUSING ASSISTANCE PAYMENTS PROGRAM--EXISTING

HOUSING

9. The authority citation for part 882 continues to read as

follows:

Authority: 42 U.S.C. 1437a, 1437c, 1437f, and 3535(d).

Subpart A--Applicability, Scope and Basic Policies

Sec. 882.118 [Amended]

10. In Sec. 882.118, paragraph (a)(1) is amended by removing the

references ``24 CFR part 750'' and ``24 CFR part 760'', and by adding

in their places, ``part 5, subpart B, of this title'', respectively.

Subpart B--Project Development and Operation

Sec. 882.212 [Amended]

11. Section 882.212 is amended:

a. In paragraph (a) by removing the parenthetical reference ``(see

24 CFR parts 750, 760, and 813)'', and by adding in its place the

parenthetical reference ``(see parts 5, subpart B, and 813 of this

title)'';

b. In paragraph (b) by removing the references ``24 CFR

750.10(d)(2)(i)'' and ``24 CFR part 760'', and by adding in their

places the reference ``part 5, subpart B, of this title''; and

c. In paragraph (c) by removing the references ``24 CFR part 750''

and ``24 CFR part 760'', and by adding in their places the reference

``part 5, subpart B, of this title'', respectively.

Subpart E--Special Procedures for Moderate Rehabilitation--Program

Development and Operation

Sec. 882.515 [Amended]

12. Section 882.515 is amended:

a. In paragraph (a) by removing the reference ``24 CFR part 760'',

and by adding in its place the reference ``part 5, subpart B, of this

title'';

b. In paragraph (b) by removing the references ``24 CFR

750.10(d)(2)(i)'' and ``24 CFR part 760'', and by adding in their

places the reference ``part 5, subpart B, of this title'',

respectively; and

c. In paragraph (c) by removing the references ``24 CFR part 750''

and ``24 CFR part 760'', and by adding in their places the reference

``part 5, subpart B, of this title'', respectively.

PART 886--SECTION 8 HOUSING ASSISTANCE PAYMENTS PROGRAM-- SPECIAL

ALLOCATIONS

13. The authority citation for part 886 continues to read as

follows:

Authority: 42 U.S.C. 1437a, 1437c, 1437f, 3535(d), and 13611-

13619.

Subpart A--Additional Assistance Program for Projects With HUD-

Insured and HUD-Held Mortgages

Sec. 886.105 [Amended]

14. Section 886.105 is amended in the undesignated paragraph

following

[[Page 11119]]

paragraph (f) by removing the reference ``24 CFR part 750'', and by

adding in its place the reference ``part 5, subpart B, of this title''.

Sec. 886.119 [Amended]

15. In Sec. 886.119, paragraphs (a) (3) and (7) are amended by

removing the references ``24 CFR part 750'' and ``24 CFR part 760'',

and by adding in their places the reference ``part 5, subpart B, of

this title'', respectively.

Sec. 886.124 [Amended]

16. Section 886.124 is amended:

a. In paragraph (a) by removing the reference ``24 CFR part 760'',

and by adding in its place the reference ``part 5, subpart B, of this

title'';

b. In paragraph (b) by removing the references ``24 CFR

750.10(d)(2)(i)'' and ``24 CFR part 760'', and by adding in their

places the reference ``part 5, subpart B, of this title'',

respectively; and

c. In paragraph (c) by removing the references ``24 CFR part 750''

and ``24 CFR part 760'', and by adding in their places the reference

``part 5, subpart B, of this title'', respectively.

Subpart C--Section 8 Housing Assistance Program for the Disposition

of HUD-Owned Projects

Sec. 886.305 [Amended]

17. Section 886.305 is amended by removing the reference ``24 CFR

part 750'', and by adding in its place the reference ``part 5, subpart

B, of this title''.

Sec. 886.318 [Amended]

18. In Sec. 886.318, paragraphs (a) (3) and (6) are amended by

removing the references ``24 CFR part 750'' and ``24 CFR part 760'',

and by adding in their places the reference ``part 5, subpart B, of

this title'', respectively.

Sec. 886.324 [Amended]

19. Section 886.324 is amended:

a. In paragraphs (a) and (c) by removing the references ``24 CFR

part 750'' and ``24 CFR part 760'', and by adding in their places the

reference ``part 5, subpart B, of this title'', respectively; and

b. In paragraph (b) by removing the references ``24 CFR

750.10(d)(2)(i)'' and ``24 CFR part 760'', and by adding in their

places the reference ``part 5, subpart B, of this title'',

respectively.

PART 887--HOUSING VOUCHERS

20. The authority citation for part 887 continues to read as

follows:

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

Subpart H--Payment Standard and Housing Assistance Payment

Sec. 887.355 [Amended]

21. Section 887.355(a) is amended by removing the references ``24

CFR part 750'' and ``24 CFR part 760'', and by adding in their places

the reference ``part 5, subpart B, of this title'', respectively.

PART 913--DEFINITION OF INCOME, INCOME LIMITS, RENT AND

REEXAMINATION OF FAMILY INCOME FOR THE PUBLIC HOUSING PROGRAM

22. The authority citation for part 913 continues to read as

follows:

Authority: 42 U.S.C. 1437a, 1437d, 1437n and 3535(d).

Sec. 913.109 [Amended]

23. In Sec. 913.109, paragraphs (a) and (b) are amended by removing

the references ``24 CFR part 750'' and ``24 CFR part 760'', and by

adding in their places the reference ``part 5, subpart B, of this

title'', respectively.

PART 950--INDIAN HOUSING PROGRAMS

24. The authority citation for part 950 is revised to read as

follows:

Authority: 25 U.S.C. 450e(b); 42 U.S.C. 1437aa-1437ee, and

3535(d).

Subpart D--Operation

Sec. 950.301 [Amended]

25. In Sec. 950.301, paragraphs (a)(3)(v) and (vi) are amended by

removing the references ``24 CFR part 750'' and ``24 CFR part 760'',

and by adding in their places the reference ``part 5, subpart B, of

this title'', respectively.

Sec. 950.315 [Amended]

26. In Sec. 950.315, paragraph (b) is amended by removing the

references ``24 CFR part 760'' and ``24 CFR part 750'', and by adding

the reference ``part 5, subpart B, of this title'', respectively.

Subpart E--Mutual Help Homeownership Opportunity Program

Sec. 950.416 [Amended]

27. In Sec. 950.416, paragraph (d) is amended by removing the

reference ``24 CFR part 750'', and by adding in its place the reference

``part 5, subpart B, of this title''.

PART 960--ADMISSION TO, AND OCCUPANCY OF, PUBLIC HOUSING

28. The authority citation for part 960 continues to read as

follows:

Authority: 42 U.S.C. 1437a, 1437c, 1437d, 1437n, and 3535(d).

Subpart B--Admission, Rent and Reexamination

Sec. 960.209 [Amended]

29. Section 960.209 is amended:

a. In paragraph (a) by removing the references ``24 CFR part 750''

and ``24 CFR part 760'', and by adding in its place the reference

``part 5, subpart B, of this title''; and

b. In paragraph (b) by removing the references ``24 CFR

750.10(d)(2)(i)'' and ``24 CFR part 760'', and by adding in their

places the reference ``part 5, subpart B, of this title'',

respectively.

PART 982--SECTION 8 TENANT-BASED ASSISTANCE: UNIFIED RULE FOR

TENANT-BASED ASSISTANCE UNDER THE SECTION 8 RENTAL CERTIFICATE

PROGRAM AND THE SECTION 8 RENTAL VOUCHER PROGRAM

30. The authority citation for part 982 is revised to read as

follows:

Authority: 42 U.S.C. 1437a, 1437c, 1437f, and 3535(d).

Subpart L--Family Obligations; Denial and Termination of Assistance

Sec. 982.551 [Amended]

31. Section 982.551(b)(3) is amended by removing the references

``24 CFR part 750'' and ``24 CFR part 760'', and by adding in their

places the reference ``part 5, subpart B, of this title'',

respectively.

PART 983--SECTION 8 PROJECT-BASED CERTIFICATE PROGRAM

32. The authority citation for part 983 continues to read as

follows:

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

Subpart E--Management

Sec. 983.205 [Amended]

33. Section 983.205(b)(3) is amended by removing the references

``24 CFR part 750'' and ``24 CFR part 760'', and by adding in their

places the reference ``part 5, subpart B, of this title'',

respectively.

Dated: March 6, 1996.

Henry G. Cisneros,

Secretary.

[FR Doc. 96-6215 Filed 3-15-96; 8:45 am]

BILLING CODE 4210-32-P