Releasing Information

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

Office of Federal Housing Enterprise Oversight

12 CFR Part 1710

RIN 2550-AA01

Releasing Information

AGENCY: Office of Federal Housing Enterprise Oversight, HUD.

ACTION: Final rule.

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SUMMARY: The Office of Federal Housing Enterprise Oversight (OFHEO) is

issuing a final rule which sets forth the basic policies of OFHEO

regarding disclosure of information it maintains and the procedures for

obtaining access to such information by the public. The rule implements

the Freedom of Information Act (FOIA) and establishes a schedule of

fees, which will be charged for the processing of record requests under

the FOIA. In addition, the rule sets forth procedures to be followed to

request testimony or the production of documents in legal proceedings

in which OFHEO is not a named party as

[[Page 70999]]

well as procedures for service of process upon OFHEO in any legal

proceeding.

EFFECTIVE DATE: January 22, 1999.

FOR FURTHER INFORMATION CONTACT: Gary L. Norton, Deputy General

Counsel, Christine C. Dion, Associate General Counsel, 1700 G Street

NW., Fourth Floor, Washington, DC 20552, telephone (202) 414-3829 (not

a toll-free number). The telephone number for the Telecommunications

Device for the Deaf is (800) 877-8339.

SUPPLEMENTARY INFORMATION:

I. Background

Title XIII of the Housing and Community Development Act of 1992,

Pub. L. No. 102-550, known as the Federal Housing Enterprises Financial

Safety and Soundness Act of 1992 (1992 Act), established OFHEO as an

independent office within the Department of Housing and Urban

Development (HUD). OFHEO is responsible for ensuring the financial

safety and soundness and the capital adequacy of the Federal National

Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage

Corporation (Freddie Mac) (collectively, the Enterprises).

In order to carry out its regulatory responsibilities, OFHEO is

issuing this final rule governing the release of information to the

public. The rule implements the FOIA by establishing procedures by

which the public may inspect OFHEO records, request and obtain copies

of materials, and appeal denials of such requests under the FOIA. This

rule also includes a schedule of fees and procedures for determining

when fees should be waived or reduced for FOIA requests in conformance

with applicable guidelines of the Department of Justice (DOJ) and the

Office of Management and Budget (OMB). The final rule also implements

Executive Order 12600 by providing predisclosure notification

procedures for confidential commercial or financial information. In

addition, this final rule prescribes procedures for requesting access

to records or testimony in legal proceedings in which OFHEO is not a

named party. Also set forth in the final rule are procedures for

effecting service upon OFHEO in any legal process, including service of

process by litigants seeking access to OFHEO records.

OFHEO is aware of recent amendments to the FOIA resulting from the

Electronic Freedom of Information Act Amendments of 1996 (1996 Act),\1\

which was enacted to provide for public access to information in an

electronic format and for other purposes. OFHEO will implement the 1996

Act's amendments under separate rulemaking.

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\1\ Pub. L. No. 104-231, 110 Stat. 3048.

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Comments on the proposed rule \2\ were received from Fannie Mae and

Freddie Mac. Those comments were carefully considered in developing

this final rule and a discussion of the Enterprises' comments and

OFHEO's response to those comments follows.

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\2\ 60 FR 25162, May 11, 1995.

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II. Comments on the Proposed Releasing Information Rule

General Comments

Most of the Enterprises' comments related to their request that the

proposed rule be expanded to include provisions specifying how the

agency will process a request for information which is not required to

be disclosed under the FOIA because it is covered by an FOIA exemption.

The Enterprises commented that the absence of such provisions would

result in unnecessary burdens on OFHEO's staff by necessitating a case-

by-case review of requests for nonpublic information, and would lead to

uncertainty and unpredictability in the disclosure policy of future

OFHEO administrations. The Enterprises also noted that regulations

governing access to records subject to discretionary disclosure have

been adopted by the other financial institution regulatory agencies \3\

and that Congress intended OFHEO to act in a manner similar to those

agencies.

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\3\ See, e.g., 12 CFR part 261 Secs. 261.1-261.17 (Board of

Governors of the Federal Reserve System).

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OFHEO agrees with the Enterprises' comments that OFHEO's enabling

statute contains several provisions demonstrating congressional intent

that OFHEO consider the policies, rules, and procedures of the bank

regulatory agencies in implementing its operational and regulatory

authorities. In fact, it is the practice of OFHEO to carefully monitor

the law applicable to the bank regulatory agencies as well as the rules

and guidance of those agencies in order to more effectively carry out

OFHEO's role as the Enterprises' safety and soundness regulator.

For instance, the proposed regulation included provisions governing

requests for information in litigation in which OFHEO is not a party

which are similar to regulations adopted by the bank regulators. These

regulations are designed to ensure that appropriate limits are placed

on examination and other confidential information that may be sought as

evidence in such litigation. This final regulation contains the same

provisions. However, OFHEO has determined that, at this time, it is not

appropriate or necessary to adopt regulations governing how the agency

exercises its discretion in connection with other requests for

information that are not subject to mandatory release under the FOIA.

The other regulators have adopted those regulations primarily

because they receive numerous requests for certain categories of

information, which they regularly disclose under their discretionary

authority. Unlike the bank regulatory agencies, which have been in

existence for many years, OFHEO has not experienced a large volume of

requests by the public for nonpublic information. To date, each request

that has been received has been reviewed and processed on a case-by-

case basis under the FOIA. OFHEO believes that the existing procedures

are appropriate and effective and do not pose an undue burden on the

agency. OFHEO will, of course, monitor the volume and nature of

information requests on an ongoing basis and propose appropriate

amendments to the regulation if they are deemed necessary.

Fannie Mae expressed concern that a ``gap'' in the disclosure

coverage in OFHEO's final rule could result in FOIA requesters

asserting that HUD's rules, not OFHEO's, apply to such requests. Fannie

Mae further commented that HUD's existing and future disclosure rules

and policies may be inconsistent or conflict with OFHEO's disclosure

policies and with the appropriate treatment of sensitive OFHEO

supervisory records. Fannie Mae expressed concerns that the application

of HUD's disclosure rules could result in the release of highly

sensitive Enterprise information by HUD.

There is no ``gap'' in coverage. These regulations govern all OFHEO

records and requests for those records. The 1992 Act established OFHEO

as an independent office within HUD and expressly divided the

regulatory responsibilities over the Enterprises--HUD was assigned

programmatic oversight over the Enterprises' housing programs; \4\

OFHEO was assigned supervision and enforcement of the financial safety

and soundness of the Enterprises.\5\ Congress granted the Director

independent authority with respect to the capital adequacy and safety

and soundness regulation of the Enterprises.\6\ In addition, Congress

granted the OFHEO Director broad

[[Page 71000]]

authority to make such determinations, take such actions, and perform

such functions as the Director determines are necessary regarding the

management of OFHEO.\7\ The Director's independent management authority

is reinforced by the statutory provision prohibiting the Secretary of

HUD from merging or consolidating OFHEO or any of its functions or

responsibilities with any function or program administered by the

Secretary.\8\

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\4\ Sections 1321-1349 (12 U.S.C. 4541-4589).

\5\ Sections 1311-1319G (12 U.S.C. 4511-4526); sections 1361-

1379B (12 U.S.C. 4611-4641).

\6\ 1992 Act, section 1313(b)(1)-(8)(12 U.S.C. 4513(b)(1)-(8)).

\7\ 1992 Act, section 1313(b)(9) (12 U.S.C. 4513(b)(9)).

\8\ 42 U.S.C. 3534.

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This final rule governing the release of OFHEO information is being

promulgated under the Director's exclusive rulemaking authority. It

affects the management of OFHEO, i.e., OFHEO's disclosure policy, the

testimony of employees, and access to OFHEO records. For this reason,

OFHEO, not HUD, would decide whether or not to release OFHEO records.

Records under OFHEO's control are not covered by HUD's general rules on

information disclosure.

To date, FOIA requests involving OFHEO information or records,

which have been received by HUD, are referred to OFHEO's FOIA Officer

for response under OFHEO's disclosure rule and processing procedures.

Conversely, OFHEO's FOIA Officer ensures that FOIA requests for HUD

information or records are forwarded to HUD's FOIA Officer for response

under HUD's disclosure rules.

Freddie Mac commented that the 1992 Act did not specifically

delegate to OFHEO the function of public dissemination of information

about the Enterprises. Accordingly, Freddie Mac stated that OFHEO

generally should exercise its discretion concerning the release of

information about the Enterprises in a manner whereby the Enterprises,

not OFHEO, decide whether to release such information. Freddie Mac

commented that, to the extent that such nonpublic information

originates with the Enterprises, it is the Enterprise's property, not

OFHEO's. Therefore, Freddie Mac believes that OFHEO's determination to

release information should only be made after the Enterprises have had

the opportunity to comment on the effect of any disclosure of such

information to the public.

In response to this comment, OFHEO notes that OFHEO is subject to

the legal requirements of the FOIA. Under the FOIA, all responsive

records possessed by and within the control of OFHEO at the time such

requests are made must be released, unless OFHEO determines not to

release them under an applicable exemption or the records are

specifically excluded from FOIA's coverage. The nine exemptions of the

FOIA ordinarily provide the only bases for nondisclosure and generally

are discretionary in nature. Under the FOIA, discretion to exercise any

of the nine exemptions is confined to OFHEO, as the statute's

implementing agency. Submitters of information are not authorized under

the FOIA to invoke an exemption. However, under certain circumstances,

OFHEO must notify and consider input from submitters prior to releasing

records. As discussed below, exemption (b)(4) requires OFHEO to give

submitters of confidential commercial or financial information an

opportunity to object to the release of such information. However, even

in those instances and subject to certain notice requirements, the FOIA

requires OFHEO to make the final decision as to whether any information

will be released.

Below is OFHEO's response to the Enterprises' comments on the

specific sections as they appear in the proposed rule.

Section Comments

Subpart A--Information and Records Generally

Section 1710.1 General Rule

Stating that the lack of a definition for the term ``information''

may result in the disclosure of certain confidential information,

Fannie Mae requested that the term be defined in the final rule.

Section 1710.1 restricts the disclosure of ``any information in the

possession of OFHEO that is confidential or otherwise of a nonpublic

nature'' including information of the Enterprises. The term

``information'' is not defined in the section or elsewhere in the

proposed rule because OFHEO intended that the term be given its common

meaning, i.e., any knowledge derived from experience with a particular

event or situation.\9\ This meaning would impose a broad-based

prohibition against the unauthorized disclosure of any nonpublic

information that is obtained by, produced by, accessed by, or disclosed

to an OFHEO employee in connection with his or her work experience with

OFHEO. OFHEO believes that all information which has not become part of

the body of public information, including, but not limited to,

information regarding the Enterprises or OFHEO, should be afforded

maximum safeguards and that the common, all-encompassing meaning of

``information'' provides such safeguards. Accordingly, it has been

determined that the final rule should not be revised to define the term

``information.'' Rather, the term has been added to section 1710.7(a)

in this final rule to make it clear that OFHEO intends that the

prohibitions against unauthorized disclosure apply very broadly to all

nonpublic OFHEO documents and information. Moreover, since Fannie Mae

raised the issue of the use of the term ``information,'' OFHEO

carefully reviewed the proposed rule regarding other informational-type

terms. For consistency, changes were made in the final rule to ensure

that the term ``record'' is contained in provisions relating to FOIA

requests. The term ``document'' is used in place of the terms

``record'' and ``material'' in all other provisions of the final rule

relating to requests for OFHEO nonpublic information.

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\9\ See Webster's II New Riverside University Dictionary (1994).

See e.g., Addison v. Holly Hill Fruit Products, 322 U.S. 607, 618

(1994) (when common words are not defined, they should be given

common meaning).

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OFHEO agrees with the Enterprises' comments that, for purposes of

clarification, the term ``employee'' should be defined in the final

rule. To that end, OFHEO has defined the term.

Consistent with that definitional recommendation, OFHEO determined

that it also would be beneficial to define certain other terms for

purposes of the entire part 1710. The final rule contains a new

subpart, which consolidates in one place various terms used throughout

part 1710. Those general definitions are contained in subpart A of the

final rule. Subparts A through E of the proposed rule are redesignated

in the final rule as subparts B through F, respectively, and, sections

1710.1-.3 are renumbered as 1710.6-.8, respectively. Definitions that

are specific to a particular subpart continue to be defined within that

subpart in the final rule.

Additionally, to effect a more appropriate placement of its

content, section 1710.41 of the proposed rule is renumbered as 1710.9

and is moved to subpart B in the final rule. The section enumerates

final orders and agreements that OFHEO shall make available to the

public.

Subpart B--Availability of Records of OFHEO

Section 1710.11 Official Records of OFHEO

Fannie Mae commented that section 1710.11(d) provides that certain

records exempt from FOIA disclosure may be released if ``specifically

authorized by the Director,'' without a requirement

[[Page 71001]]

that such authority be in writing. Fannie Mae noted that the proposed

rule requires written authorization for release of examination reports,

and official documents or information disclosure in third-party legal

proceedings. Fannie Mae requested that section 1710.11(d) be revised to

require specific Director authorization ``in writing.''

OFHEO has determined not to change section 1710.11(d) in the final

rule. The requested change would require the Director to approve in

writing any decision to disclose a document that is subject to

discretionary release under the FOIA. While the FOIA Officer may

consult generally with the Director, authority to approve in writing

any decision to disclose such documents has been delegated by the

Director to the FOIA Officer in accordance with the procedural

requirements of the FOIA, Executive Order 12600, and OFHEO's internal

information disclosure policy.

Section 1710.18 Special Procedures for Business Information

With respect to section 1710.18, addressing business information,

Freddie Mac commented that OFHEO should adopt the simple rule that any

submissions designated as confidential by a submitter, unless

frivolous, should be covered by the notice and other protections of the

rule. Freddie Mac stated that this simple rule is consistent with

FOIA's Exemption 4. Freddie Mac objected to the ``good faith''

requirement found in sections 1710.18(c) and 1710.18(e)(1) of the

proposed rule and requested that the requirement be deleted from the

final rule. Freddie Mac argued that the undefined ``good faith''

requirement is in contravention of Executive Order 12600. Freddie Mac

stated that, under the Executive order, notice and an opportunity to

object to disclosure of information is required and an agency's opinion

of a submitter's ``good faith'' is irrelevant. It further stated that

the ``good faith'' standard is inconsistent with the definition of

business information found at section 1710.18(b)(1) of the proposed

regulation. Freddie Mac expressed concerns that the ``good faith''

requirement at section 1710.18(e)(1) would make the process by which

OFHEO judges a submitter's designation as confidential business

information too subjective. Moreover, it alleged that to allow OFHEO

staff to make determination on the notice requirement would give it

``dangerous power'' and would not reflect respect for the fact that

business information submitted to OFHEO is the property of the

Enterprise and, therefore, any decision to disclose such information

should not be made without the views of the submitting Enterprise.

Freddie Mac further commented that the provision found at section

1710.18(i)(4), which allows OFHEO to dispense with notice procedures if

a designation is ``obviously frivolous,'' makes the ``good faith''

requirement unnecessary since it gives OFHEO the ability to disclose

when a confidential designation is unwarranted.

The ``good faith'' requirements for submitters of business

information under section 1710.18, as proposed, simply reiterate the

policy underlying Executive Order 12600 that submitters should not

frivolously designate submissions as being protected from disclosure

under Exemption 4. The good faith language conforms to that contained

in the FOIA regulations of DOJ, which is the lead agency responsible

for implementation of the FOIA. Moreover, it is consistent with FOIA

regulations of other Federal agencies, such as the Office of the

Comptroller of the Currency, the Office of Thrift Supervision, and the

Office of Personnel Management. OFHEO believes that the ``good faith''

requirement provides a workable standard and will not give rise to the

concerns raised by Freddie Mac. Accordingly, OFHEO has retained the

section's good faith requirements in the final rule.

Freddie Mac also commented that reports of examination and related

materials should be treated the same way as business information. It

requested that the same protections afforded to business information

under Executive Order 12600 and proposed that section 1710.18 be

extended to examination reports and related materials.

It is clear from the plain language of Executive Order 12600 that

examination reports are not the type of ``confidential commercial

information'' intended to be subject to its prenotification procedures.

OFHEO is not aware of, and Freddie Mac did not identify, any problems

that warrant extending the predisclosure notice requirements of this

section beyond the scope of Executive Order 12600. Additionally, OFHEO

notes that, while examination reports may contain confidential

commercial information, the reports are OFHEO-produced and OFHEO-owned

documents. OFHEO examination reports are exempt from disclosure under

the FOIA by a specific exemption (5 U.S.C. 552(b)(8)). For these

reasons, the prenotification requirements of section 1710.18 have not

been revised in the final rule to include examination reports.

With respect to the prenotification requirements for business

information, Fannie Mae requested that sections 1710.18(f) and (g)(2)

of the proposed rule be revised to provide a submitter with a minimum

period of 10 days in which to object to a request to disclose and to be

advised of an agency's intent to disclose.

In drafting sections 1710.18(f) and (g), OFHEO sought to be

consistent with the prenotification requirements applicable to FOIA

requests for business information set forth in Executive Order 12600.

Among other things, the Order provides a submitter of such information

a ``reasonable period of time'' in which to object to disclosure of the

information. The Order also requires that an agency give submitters

notice of agency intent to disclose within a ``reasonable number of

days'' prior to the specified disclosure date.

In order to codify OFHEO's prenotification practice, OFHEO

specified in section 1710.18(g)(1) that it would provide notice to a

submitter of its intent to disclose 10 business days before the

specified disclosure date. To fulfill its obligation under the Order to

also notify the requester, OFHEO stated in section 1710.18(g)(2) that

OFHEO would forward to the requester of business information a copy of

the notice to disclose at the same time that OFHEO forwards such notice

to the business submitter.

For purposes of consistency, OFHEO has determined to revise section

1710.18 in the final rule to include the 10-day notice provision in

subsection (f) relating to a submitter's opportunity to object to

disclosure. For purposes of clarification, OFHEO has further determined

to delete reference to submitters in section 1710.18(g)(2), as their

inclusion would be redundant to coverage provided under subsection

(g)(1). Subsection (e) has been modified to more fully correspond to

the language of Executive Order 12600.

The title of section 1710.18 has been changed in this final rule

from ``Business Information'' to ``Special Procedures for Business

Information'' to more fully highlight the unique treatment afforded to

such information under Executive Order 12600.

Subpart C--Fees for Provision of Information

Section 1710.23 Fees To Be Charged--Categories of Requesters

Commenting on section 1710.23(a) relating to fees charged FOIA

requesters, Fannie Mae noted that the proposal states that OFHEO ``will

seek clarification'' before assigning a fee

[[Page 71002]]

category if it reasonably doubts a use classification for purposes of

charging a fee for record copying, or if the purpose is not clear from

the request. Fannie Mae stated that this would obligate OFHEO to engage

in inquiries that may be administratively burdensome; that requesters

are in the best position to provide adequate information to avoid such

expense. Fannie Mae requested that the section be revised to state that

OFHEO ``may place the requester in the commercial use category or may

seek additional clarification.''

The Freedom of Information Reform Act of 1986 \10\ specifically

required OMB to promulgate guidelines containing a uniform schedule of

FOIA fees applicable to all agencies that are subject to the FOIA. The

uniform guidelines issued by OMB advise agencies to resolve doubtful or

unclear requests to ensure that the appropriate use category is

assigned to a requester for purposes of charging fees. Among other

things, the guidelines note the need to distinguish between requesters

whose use of information is for a use that furthers their business

interests, as opposed to a use that in some way benefits the public.

Section 1710.23(a), as proposed, follows OMB's guidelines. Accordingly,

OFHEO has determined to adopt this section as proposed.

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\10\ Pub. L. No. 99-570, 100 Stat. 3207.

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Subpart D--Testimony and Production of Documents in Legal Proceedings

in Which OFHEO Is Not a Named Party

Stating that any harm to the Enterprises is the same whether

sensitive information is made public under the FOIA or pursuant to

legal process, Freddie Mac requested that the prenotification

requirements for business information should also apply to any request

for information under subpart D of the proposed rule. For the reasons

noted earlier, OFHEO has determined not to extend its prenotification

procedures beyond the scope of Executive Order 12600 in this final

rule.

Freddie Mac stated that, prior to the production of the

information, OFHEO should provide the Enterprises with the opportunity

to comment on the scope of any protective order governing the release

of sensitive, nonpublic commercial or examination materials directly

relating to them. As noted earlier, OFHEO believes that the provisions

of the proposed rule, including those contained in subpart D,

adequately safeguard the confidentiality of OFHEO documents and

information. However, OFHEO may solicit input from the Enterprises

whenever it is determined that such consultation would further

complement those safeguards. Accordingly, the provisions of subpart D

are being adopted as proposed.

SECTION-BY-SECTION ANALYSIS

I. General Definitions

Subpart A of the final rule provides definitions of terms used

throughout part 1710. Section 1710.1 explains the scope of subpart A.

Section 1710.2 defines the common terms used throughout part 1710.

II. Documents and Information Generally

Subpart B of the final rule contains general provisions relating to

disclosure of documents and information in the possession of OFHEO.

Section 1710.6 sets forth procedures for disclosure of such materials.

Section 1710.7 provides that the disclosure requirements of the FOIA

and the final rule apply to all OFHEO documents and information. It

also provides that if another statute sets specific procedure for

disclosure, OFHEO will process a request in accordance with the

procedures that apply to those specific documents. If a request is

received for disclosure of a document to the public which is not

required to be released under those provisions, OFHEO will consider the

request under the FOIA and the provisions of this final rule.

Section 1710.7 describes the relationship between the FOIA and the

Privacy Act of 1974 (Privacy Act), 5 U.S.C. 552a, and explains that

records that are available through an established distribution system

should preferably be obtained through that system, rather than pursuant

to the provisions of the FOIA.

Section 1710.8 of subpart B contains a general provision providing

that reports of examinations prepared by OFHEO are the property of

OFHEO and may only be disclosed in accordance with part 1710 or with

the prior written consent of the Director. The section further provides

that any unauthorized use or disclosure of such documents may be

subject to penalties under Federal law. Section 1710.8 explains that

the Director will make available to each Enterprise a copy of the

examination report of that Enterprise and that the Enterprise may not

disclose or use such reports except as expressly permitted by the

Director. The section also explains that the Director has discretion to

make the examination reports available for the confidential use of

Government agencies responsible for investigating and enforcing

applicable laws.

As noted earlier, section 1710.41 of the proposed rule is

renumbered as section 1710.9 in subpart B of this final rule. Section

1710.9 enumerates final orders and agreements that the Director is

required to make available to the public. The section also has been

modified to mirror those statutory requirements.

III. Availability of OFHEO Records

Subpart C implements the FOIA, 5 U.S.C. 552, and describes (1)

OFHEO records available to the public, (2) OFHEO information exempt

from disclosure, (3) OFHEO's record index, (4) request requirements,

(5) response requirements, (6) response content, (7) appeal procedures,

and (8) time limits for processing requests and appeals. Subpart C also

contains OFHEO's procedures for responding to FOIA requests for

confidential, commercial and financial information, i.e., business

information, provided to OFHEO.

Section 1710.11 describes OFHEO records that are available pursuant

to 5 U.S.C. 552(a) for public inspection and copying at the offices of

OFHEO. These records include any final orders and agreements made in

adjudication of cases, which are enumerated in section 1710.9 of the

final rule. Section 1710.11 also describes the categories of OFHEO

records that are exempt from disclosure. These exemptions follow the

exemptions provided in the FOIA.

Section 1710.12 sets forth the indexing requirements for records

OFHEO maintains which are required to be indexed under 5 U.S.C.

552(a)(2). The section contains the Director's determination that,

because of the lack of requests to date for records required to be

indexed, such indexes do not need to be published quarterly.

Section 1710.13 contains rules of procedure for requesting records

under the FOIA. Requests for OFHEO records should be in writing and

addressed to the FOIA Officer. Each request should contain sufficient

detail to allow the FOIA Officer to locate the record with a reasonable

amount of effort. If a request is too broad or too vague to allow the

record to be located with a reasonable amount of effort, OFHEO will

assist the requester in revising the request as appropriate.

Procedures for OFHEO's response to FOIA requests are explained in

sections 1710.14 and 1710.15. The FOIA Officer has been delegated the

responsibility in section 1710.14 to grant or deny such requests and to

determine fees. Paragraph (b) of section 1710.14 also provides that

OFHEO will refer FOIA

[[Page 71003]]

requests for records that originated in another Government agency to

that agency for response. In such cases, the requester will be notified

of the referral. Paragraph (c) of section 1710.14 states that OFHEO

will provide whatever records respond to a request, but will not create

a new record in order to respond. Moreover, to mirror the FOIA's

requirements, language has been added to the section in the final rule

noting that OFHEO will make reasonable efforts to provide information

in the format requested. Also, OFHEO will notify the requester if,

regardless of format, no records are responsive to the request.

Section 1710.15 requires the FOIA Officer to notify a requester in

writing of the determination to grant a request in whole or in part.

The response must describe the manner in which the record will be

disclosed and inform the requester of any fees that will be charged.

Similarly, the FOIA Officer's determination to deny a request in whole

or in part must be made in writing and signed by the FOIA Officer.

Consistent with section 1710.15(b), any denial is to contain a brief

statement describing the basis of the denial, including the FOIA

exemption(s) that is relied upon. Moreover, the denial must state that

the requester has a right to appeal and must explain OFHEO's appeal

procedures.

OFHEO's appeal procedures are set forth in section 1710.16 of the

final rule. Denials may be appealed to OFHEO's FOIA Appeals Officer

within 30 days after receipt of a denial letter. Appeals must be in

writing and must contain reasons for, or arguments in support of,

disclosure. OFHEO will respond to appeals in writing and will specify

the reason(s) for affirming any original denial. When a denial is

reversed in whole or in part, the request for disclosure will be

processed promptly. The decision on appeal is OFHEO's final action on a

request. Requesters have a right to seek judicial review of the final

action under 5 U.S.C. 552(a)(4).

Section 1710.17 of the final rule describes the time limits to

which OFHEO will adhere in responding to initial requests and appeals

of denials of requests. The response period for an initial request has

been revised from 10 days to 20 days in this final rule to reflect

statutory changes made by the 1996 Act. The section states that the

time limits applicable to either initial requests or appeals of denials

of requests may be extended up to a total of 10 days (excluding

weekends and legal holidays) in unusual circumstances, i.e., when the

records are in a location other than the main office of OFHEO, the

request is for a large number of records, or OFHEO must consult with

another agency or with various offices within OFHEO.

Section 1710.18 of the final rule contains OFHEO's procedures for

disclosure of sensitive, business information provided to OFHEO.

Generally, the section requires submitters of business information to

designate those portions of their submissions they believe may be

exempt from disclosure under Exemption 4 of the FOIA. If records so

designated are subsequently requested under the FOIA, in most cases the

submitter will have an opportunity to provide a written objection to

disclosure. The written objection must demonstrate why the information

is contended to be a trade secret or commercial or financial

information that is privileged or confidential and why disclosure would

cause competitive harm. Whenever possible, the submitter's claim of

confidentiality should be supported by a statement or certification by

an officer or authorized representative of the submitter. Information

that is provided by a submitter for the purpose of objecting to

disclosure may itself be subject to disclosure under the FOIA.

IV. Fees for Provision of Information

Subpart D of the final rule contains provisions relating to the

fees which will be assessed for services rendered in responding to and

processing requests for records under the FOIA. Fees are to be based on

the type of service provided, e.g., search, review, and duplication, as

well as the category of person making the request, e.g., commercial

user, educational institution, and news media. Generally, commercial

requesters will pay the full amount of permissible fees relating to

record search, review, and duplication. Educational and noncommercial

scientific institutions and the news media will pay only duplication

costs, excluding charges for the first 100 pages. All other requesters

will be assessed fees for search and duplication, except that the first

100 pages of duplication and the first 2 hours of search time will be

furnished without charge. As a matter of policy, OFHEO will not charge

fees for any individual request if the cost of collecting a fee would

equal or exceed the fee itself.

Additionally, under the final rule, OFHEO may furnish records

without charge or at a reduced charge where disclosure of the requested

information is in the public interest because it is likely to

contribute significantly to public understanding of the operations or

activities of the Federal Government and is not primarily in the

commercial interest of the requester. In making this determination,

OFHEO will apply the six analytical factors set out by DOJ in its

advisory memorandum on making FOIA fee waiver determinations. The

memorandum, titled ``New FOIA Fee Waiver Policy Guidance,'' was issued

by the Assistant Attorney General for Legal Policy to the heads of all

Federal agencies on April 2, 1987. The factors enumerated in the

memorandum have been incorporated in section 1710.24.

Section 1710.25 contains a number of miscellaneous provisions

concerning fees, including a requirement that requesters pay in advance

fees likely to exceed $250.00. However, advance payment may not be

required in the case of a requester who has a history of prompt

payment. This section also includes a provision permitting interest to

be charged on fees over 30 days past due at the rate prescribed in 31

U.S.C. 3717 for an outstanding debt on a U.S. Government claim.

V. Testimony and Production of Documents in Legal Proceedings in

Which OFHEO Is Not a Named Party

Subpart E prescribes the policies and procedures of OFHEO with

respect to the testimony of official matters and production of official

documents of OFHEO in legal proceedings in which OFHEO is not a named

party. The subpart does not affect the rights and procedures governing

public access to OFHEO documents pursuant to the FOIA or the Privacy

Act.

Section 1710.31 sets forth the purpose of subpart E which is to (1)

ensure the confidentiality of OFHEO documents and information, (2)

maintain the impartial position of OFHEO in litigation in which OFHEO

is not a named party, (3) conserve the time of employees for their

official duties, and (4) enable the Director to determine when to

authorize testimony and the release of documents in legal proceedings

in which OFHEO is not a named party.

Section 1710.32 contains the definitions applicable to the subpart

E. Section 1710.33 provides the general policy of OFHEO with respect to

testimony and production of documents in any legal proceeding in which

OFHEO is not a named party, i.e., employees, including former

employees, are prohibited from disclosing any information obtained in

or resulting from their official capacities unless the Director

determines in writing that disclosure would be in the best interest of

OFHEO or in the public interest. Section 1710.33 further provides that,

[[Page 71004]]

prior to any authorized testimony or release of official documents, the

requesting party must obtain a protective order from the court before

which the action is pending to preserve the confidentiality of the

testimony or documents subsequently produced.

Section 1710.34 describes the procedures to which OFHEO will adhere

to enable the Director to determine whether to grant requests for

testimony concerning official matters or disclosure of official

documents. Section 1710.35 provides that the scope of permissible

testimony by an employee is limited to that set forth in the written

authorization granted that employee by the Director. The section

addresses OFHEO employees' authority to give opinion testimony in any

legal proceeding to which OFHEO is not a party. The section has been

modified in this final rule to clarify that generally OFHEO employees

do not give such testimony, but may do so if authorized by the

Director.

Section 1710.36 describes the manner in which authorized testimony

of employees will be made available. This section has been amended in

this final rule to clarify that testimony will ordinarily be made

available only through depositions or written interrogatories. A party

requesting authorized testimony must serve a subpoena on the employee

in accordance with applicable Federal or State rules of procedure, with

a copy of the subpoena sent by registered mail to the General Counsel.

Upon completion of an authorized deposition at OFHEO's office, a copy

of the transcript of the testimony shall be furnished at the requesting

party's expense to the General Counsel.

Section 1710.37 describes the manner in which official documents

authorized for release by the Director will be produced. Certified or

authenticated copies of OFHEO documents authorized by the Director to

be released under subpart E will be provided upon request.

Section 1710.38 describes the fees charged for documents produced

by OFHEO in connection with requests under subpart E. Unless waived or

reduced, OFHEO will charge for searches for documents, duplication of

documents, and certification or authentication of documents as detailed

in the section.

Section 1710.39 provides that an employee served with a demand in a

legal proceeding concerning OFHEO or the production of official OFHEO

documents or information, must notify the General Counsel of such

service. This notification will assist the General Counsel in advising

the Director as to whether the individual should be authorized to

testify or the material requested should be made available. When

authorization to testify or produce documents is not granted by the

Director, the General Counsel shall provide the party issuing the

demand or the court with a copy of the regulations contained in subpart

E, and also shall advise the party or the court that the employee upon

whom the demand has been made is prohibited from testifying or

producing the documents without the Director's prior approval.

Section 1710.39 also provides that any employee who has official

information that has not been approved for disclosure must respond to a

legal process by attending at the time and place required. The

individual shall respectfully decline to disclose the information on

the basis of subpart E of the final rule. If a court orders disclosure

contrary to the Director's instructions, the employee shall continue to

decline to disclose the information and shall advise OFHEO of the order

for such action as OFHEO may deem appropriate. Section 1710.39 advises

that any determination under subpart E to comply or not to comply with

any demand shall not constitute an assertion or waiver of privilege,

lack of relevance, technical deficiencies, or any other ground for

noncompliance. Moreover, it is noted that OFHEO reserves the right to

oppose any demand on any legal ground independent of its determination

under subpart E.

Section 1710.40 pertains to any person who is served with a request

to release OFHEO records who is not an OFHEO employee or former

employee. Such person may not disclose OFHEO records to any person

without the Director's prior written consent. Moreover, any person

served with a demand in a legal proceeding requiring that person to

produce OFHEO documents or to testify with respect thereto, must (1)

notify the General Counsel regarding the service, (2) object to

production of such documents or information contained therein on the

basis that the documents are the property of OFHEO and cannot be

released without OFHEO's consent, and (3) note that the documents'

production must be sought from OFHEO following procedures set forth in

final sections 1710.34(b) and (c) and 1710.37(b) of subpart E of the

final rule.

VI. Rules and Procedures for Service Upon OFHEO

Section 1710.51 of subpart F provides that, with limited

exceptions, any legal process on OFHEO must be issued and served upon

the General Counsel as well as any OFHEO personnel named in the caption

of the documents. Service may be effected by either personal delivery

or by registered or certified mail to the General Counsel at OFHEO's

office.

Regulatory Impact

Executive Order 12612, Federalism

Executive Order 12612 requires that Executive departments and

agencies identify regulatory actions that have significant federalism

implications. A regulation has federalism implications if it has

substantial direct effects on the States, on the relationship or

distribution of power between the Federal Government and the States, or

on the distribution of power and responsibilities among various levels

of Government. OFHEO has determined that this rule has no federalism

implications that warrant the preparation of a Federalism Assessment in

accordance with Executive Order 12612.

Executive Order 12866, Regulatory Planning and Review

This final rule has been reviewed by OMB pursuant to Executive

Order 12866.

Executive Order 12988, Civil Justice Reform

Executive Order 12988 sets forth guidelines to promote the just and

efficient resolution of civil claims and to reduce the risk of

litigation to the Federal Government. This final rule meets the

applicable standards of sections 3(a) and (b) of Executive Order 12988.

Unfunded Mandates Reform Act of 1995

This rule does not include a Federal mandate that may result in the

expenditure by State, local, and tribal governments, in the aggregate,

or by the private sector, of $100,000,000 or more (adjusted annually

for inflation) in any one year. Consequently, the rule does not warrant

the preparation of an assessment statement in accordance with the

Unfunded Mandates Reform Act of 1995.

Regulatory Flexibility Act

The Regulatory Flexibility Act, 5 U.S.C. 601 et seq., requires that

a regulation that has a significant economic impact on a substantial

number of small entities, small businesses, or small organizations must

include an initial regulatory flexibility analysis describing the

regulation's impact on small entities. Such an analysis need not be

undertaken if the

[[Page 71005]]

agency has certified that the regulation will not have a significant

economic impact on a substantial number of small entities. 5 U.S.C.

605(b).

OFHEO has considered the impact of the regulation under the

Regulatory Flexibility Act. The General Counsel has certified that this

final rule will not have significant economic impact on a substantial

number of small entities.

Paperwork Reduction Act

The Paperwork Reduction Act of 1995, 44 U.S.C. chapter 35, requires

that regulations involving the collection of information receive

clearance from OMB. This rule contains no such collection of

information requiring OMB approval under the Paperwork Reduction Act.

Consequently, no information has been submitted to OMB for review under

the Paperwork Reduction Act.

List of Subjects in 12 CFR Part 1710

Administrative practice and procedure, Confidential business

information, Freedom of information.

Accordingly, for the reasons set out in the preamble, part 1710 is

added to chapter XVII of title 12 of the Code of Federal Regulations to

read as follows:

PART 1710--RELEASING INFORMATION

Subpart A--General Definitions

Sec.

1710.1 Scope.

1710.2 General definitions.

Subpart B--Documents and Information Generally

1710.6 General rule.

1710.7 Applicability.

1710.8 OFHEO examination reports.

1710.9 Orders and agreements available to the public.

Subpart C--Availability of Records of OFHEO

1710.11 Official records of OFHEO.

1710.12 Index identifying information for the public.

1710.13 Requests for records.

1710.14 Response to requests.

1710.15 Form and content of responses.

1710.16 Appeals of denials.

1710.17 Time limits.

1710.18 Special procedures for business information.

Subpart D--Fees for Provision of Information

1710.21 Definitions.

1710.22 Fees to be charged--general.

1710.23 Fees to be charged--categories of requesters.

1710.24 Limitations on charging fees.

1710.25 Miscellaneous fee provisions.

Subpart E--Testimony and Production of Documents in Legal Proceedings

in Which OFHEO Is Not a Named Party

1710.31 General purposes.

1710.32 Definitions.

1710.33 General policy.

1710.34 Request for testimony or production of documents.

1710.35 Scope of permissible testimony.

1710.36 Manner in which testimony is given.

1710.37 Manner in which documents will be produced.

1710.38 Fees.

1710.39 Responses to demands served on employees.

1710.40 Responses to demands served on nonemployees.

Subpart F--Rules and Procedures for Service Upon OFHEO

1710.51 Service of process.

Authority: 5 U.S.C. 301, 552; 12 U.S.C. 4513, 4522, 4526, 4639;

E.O. 12600, 3 CFR, 1987 Comp., p. 235.

Subpart A--General Definitions

Sec. 1710.1 Scope.

Definitions in Sec. 1710.2 relate to the meaning of terms used

throughout part 1710.

Sec. 1710.2 General definitions.

For the purpose of this part:

(a) Appeals Officer means the person designated by the Director to

process appeals of denials of requests for OFHEO records under the

FOIA.

(b) Director means the Director of OFHEO or his or her designee.

(c) Document means any record or paper, including but not limited

to a report, credit review, audit, examination, letter, telegram,

memorandum, study, calendar and diary entry, log, graph, pamphlet,

note, chart, tabulation, analysis, statistical or information

accumulation, any record of meetings and conversations, film

impression, magnetic tape, or any electronic media, disk, film, or

mechanical reproduction that is generated, obtained, or adopted by

OFHEO in connection with the conduct of its official business.

(d) Employee means any officer, former officer, employee, or former

employee of OFHEO; any conservator appointed by OFHEO; or any agent or

independent contractor acting on behalf of OFHEO, even though the

appointment or contract has terminated.

(e) FOIA means the Freedom of Information Act.

(f) FOIA Officer means the person designated to process requests

for OFHEO records under the FOIA.

(g) Official means concerning the authorized business of OFHEO.

(h) OFHEO means the Office of Federal Housing Enterprise Oversight.

(i) Person means any individual, or any agency, corporation,

partnership, trust, association, joint venture, pool, syndicate, sole

proprietorship, unincorporated organization, or any other form of

entity not specifically listed herein, but does not include OFHEO or

any employee.

(j) Record means any document which is created or obtained by OFHEO

and which is under OFHEO control at the time of an FOIA request.

(k) Requester means any person seeking access to OFHEO records

under the FOIA.

Subpart B--Documents and Information Generally

Sec. 1710.6 General rule.

Except as authorized by this part or as otherwise necessary in

performing official duties, no employee shall in any manner disclose or

permit disclosure of any document or information in the possession of

OFHEO that is confidential or otherwise of a nonpublic nature,

including that regarding OFHEO or the Federal National Mortgage

Association (Fannie Mae) or the Federal Home Loan Mortgage Corporation

(Freddie Mac) (collectively, the Enterprises).

Sec. 1710.7 Applicability.

(a) General. The FOIA and the regulations in this part apply to all

OFHEO documents and information. However, if another law sets specific

procedure for disclosure, OFHEO will process a request in accordance

with the procedures that apply to those specific documents. If a

request is received for disclosure of a document to the public which is

not required to be released under those provisions, OFHEO will consider

the request under the FOIA and the regulations in this part.

(b) The relationship between the FOIA and the Privacy Act of 1974.

The Privacy Act of 1974 (Privacy Act), 5 U.S.C. 552a, applies to

records that are about individuals, but only if the records are in a

system of records as defined in the Privacy Act. Requests from

individuals for records about themselves which are contained in an

OFHEO system of records will be processed under the provisions of the

Privacy Act as well as the FOIA. OFHEO will not deny access by a first

party to a record under the FOIA or the Privacy Act unless the record

is not available to that individual under both the Privacy Act and the

FOIA.

(c) Records available through routine distribution procedures. When

the record requested includes material published and offered for sale,

e.g., by

[[Page 71006]]

the Superintendent of Documents or the Government Printing Office, or

which is available to the public through an established distribution

system (such as that of the National Technical Information Service of

the Department of Commerce), OFHEO will first refer the requester to

those sources. Nevertheless, if the requester is not satisfied with the

alternative sources, OFHEO will process the request under the FOIA.

Sec. 1710.8 OFHEO examination reports.

(a) General. Reports of examinations prepared by OFHEO may be

disclosed only in accordance with this part or with the prior written

consent of the Director. No person, agency, or authority, or director,

officer, employee, or agent thereof, shall disclose any such report or

information contained therein in any manner except as authorized in

accordance with this subpart. The report of examination is the property

of OFHEO and any unauthorized use or disclosure of such report may be

subject to the penalties provided in 18 U.S.C. 641.

(b) Enterprises. The Director makes available to each Enterprise a

copy of OFHEO's report of examination of such Enterprise. The report of

examination is the property of OFHEO and is provided to the Enterprise

for its confidential use only. Under no circumstance shall the

Enterprise or any director, officer, employee, or agent thereof, make

public or disclose in any manner the report of examination or any

portion of the contents thereof to any person or organization not

officially connected with the Enterprise as director, officer,

employee, attorney, auditor, or independent auditor. Any other

disclosure or use of this report except as expressly permitted by the

Director may be subject to the penalties of 18 U.S.C. 641.

(c) Government agencies. The Director may make available reports of

examination for the confidential use of Federal agencies responsible

for investigating or enforcing applicable Federal laws.

Sec. 1710.9 Orders and agreements available to the public.

(a) General. OFHEO shall make the following documents available to

the public:

(1) Any written agreement or other written statement for which a

violation may be redressed by the Director or any modification to or

termination thereof, unless the Director, in the Director's discretion,

determines that public disclosure would be contrary to the public

interest.

(2) Any order that is issued with respect to any administrative

enforcement proceeding initiated by the Director under 12 U.S.C. 4631

through 4641 that has become final in accordance with 12 U.S.C. 4633

and 12 U.S.C. 4634.

(3) Any modification to or termination of any final order made

public pursuant to this section.

(b) Delay of public disclosure under exceptional circumstances. If

the Director makes a determination in writing that the public

disclosure of any final order pursuant to paragraph (a) of this section

would seriously threaten the financial health or security of the

Enterprise, the Director may delay the public disclosure of such order

for a reasonable time.

(c) Documents filed under seal in public enforcement hearings. The

Director may file any document or part thereof under seal in any

hearing commenced by the Director if the Director determines in writing

that disclosure thereof would be contrary to the public interest.

(d) Retention of documents. The Director shall keep and maintain a

record, for not less than 6 years, of all documents described in

paragraph (a) of this section and all enforcement agreements and other

supervisory actions and supporting documents issued with respect to or

in connection with any enforcement proceedings initiated by the

Director under 12 U.S.C. 4631 through 4641.

(e) Disclosure to Congress. This section may not be construed to

authorize the withholding of any information from, or to prohibit the

disclosure of any information to, the Congress or any committee or

subcommittee thereof.

Subpart C--Availability of Records of OFHEO

Sec. 1710.11 Official records of OFHEO.

(a) OFHEO shall, upon a written request for records which

reasonably describes the information or records and is made in

accordance with the provisions of this subpart, make the records

available as promptly as practicable to any person for inspection and/

or copying, except as provided in paragraph (d) of this section.

(b) Records available. OFHEO records which are required by 5 U.S.C.

552(a)(2) to be made available for public inspection and copying are

maintained at OFHEO's offices located at 1700 G Street, NW., Fourth

Floor, Washington, DC 20552. The records include--

(1) Any final opinions, as well as orders made in adjudication of

cases as set forth in Sec. 1710.9 of subpart B of this part;

(2) Any statements of policy and interpretation that have been

adopted by OFHEO and are not published in the Federal Register;

(3) Any administrative staff manuals and instructions to staff that

affect a member of the public, and which are not exempt from disclosure

under 5 U.S.C. 552(b); and

(4) Any current indexes providing identifying information for the

public as to any matter which OFHEO has issued, OFHEO has adopted or

promulgated, and is required by 5 U.S.C. 552(a)(2) to be made available

or published.

(c) Copying. The cost of copying information available in the

offices of OFHEO shall be imposed on a requester in accordance with the

provisions of subpart D of this part.

(d) Records not available. Except as otherwise provided in this

part, or as may be specifically authorized by the Director, the

following information and records, or portions thereof, are not

available to the public:

(1) Any record, or portion thereof, which is--

(i) Specifically authorized under criteria established by an

Executive order to be kept secret in the interest of national defense

or foreign policy, and

(ii) Is in fact properly classified pursuant to such Executive

order.

(2) Any record, or portion thereof, related solely to the internal

personnel rules and practices of OFHEO.

(3) Any record, or portion thereof, which is specifically exempted

from disclosure by statute (other than 5 U.S.C. 552(b)), provided that

such statute--

(i) Requires that the matters be withheld from the public in such a

manner as to leave no discretion on the issue, or

(ii) Establishes particular criteria for withholding or refers to

particular types of matters to be withheld.

(4) Any matter that is a trade secret or that constitutes

commercial or financial information obtained from a person and that is

privileged or confidential.

(5) Any matter contained in inter-agency or intra-agency memoranda

or letters which would not be available by law to a private party in

litigation with OFHEO.

(6) Any information contained in personnel and medical files and

similar files (including financial files) the disclosure of which would

constitute a clearly unwarranted invasion of personal privacy.

(7) Any records or information compiled for law enforcement

purposes, but only to the extent that the

[[Page 71007]]

production of such law enforcement records or information--

(i) Could reasonably be expected to interfere with enforcement

proceedings;

(ii) Would deprive a person of a right to fair trial or an

impartial adjudication;

(iii) Could reasonably be expected to constitute an unwarranted

invasion of personal privacy;

(iv) Could reasonably be expected to disclose the identity of a

confidential source, including a State, local, or foreign agency or

authority or any private institution or an Enterprise regulated and

examined by OFHEO which furnished information on a confidential basis,

and, in the case of a record of information compiled by a criminal law

enforcement authority in the course of a criminal investigation or by

an agency conducting a lawful national security intelligence

investigation, information furnished by a confidential source;

(v) Would disclose techniques and procedures for law enforcement

investigations or prosecutions, or would disclose guidelines for law

enforcement investigations or prosecutions if such disclosure could

reasonably be expected to risk circumvention of the law; or

(vi) Could reasonably be expected to endanger the life or physical

safety of any individual.

(8) Any matter that is contained in or related to examination,

operating, or condition reports that are prepared by, on behalf of, or

for the use of OFHEO.

(9) Any geological and geophysical information and data, including

maps, concerning wells.

(e) Even if an exemption described in paragraph (d) of this section

may be reasonably applicable to a requested record, or portion thereof,

OFHEO may elect under the circumstances of any particular request not

to apply the exemption to such requested record, or portion thereof.

The fact that the exemption is not applied by OFHEO to any requested

record, or portion thereof, has no precedential significance as to the

application or nonapplication of the exemption to any other requested

record, or portion thereof, no matter when the request is received.

(f) Any reasonably segregable portion of a record shall be provided

to any person properly requesting such record after deletion of the

portions which are exempt under this subpart.

(g) To the extent necessary to prevent an invasion of personal

privacy, the Director may delete identifying details from a record

described in paragraph (b) of this section. In each case of such

deletion, the justification will be clearly explained in writing.

(h) This section does not authorize withholding of information or

limit the availability of records to the public, except as specifically

stated in this section. This section is not authority to withhold

information from Congress.

Sec. 1710.12 Index identifying information for the public.

(a) OFHEO will maintain and make available for public inspection

and copying a current index of materials available at the office of

OFHEO which are required to be indexed under 5 U.S.C 552(a)(2).

(b) Because of the lack of requests to date for material required

to be indexed, the Director has determined that it is unnecessary and

impracticable to publish quarterly, or more frequently, and distribute

(by sale or otherwise) copies of each index and supplements thereto, as

provided in 5 U.S.C. 552(a)(2). However, OFHEO will provide a copy of

such indexes to a member of the public upon request, at a cost not to

exceed the direct cost of duplication and mailing, if sending records

by other than ordinary mail.

Sec. 1710.13 Requests for records.

(a) Addressing requests. Requests for records in the possession of

OFHEO shall be made in writing. The envelope and the request both

should be clearly marked ``FOIA Request'' and addressed to: FOIA

Officer, Office of Federal Housing Enterprise Oversight, 1700 G Street

NW., Fourth Floor, Washington, DC 20552. A request improperly addressed

will be deemed not to have been received for purposes of the 20-day

time period set forth in paragraph (a) of Sec. 1710.17 of this subpart

until it is received, or would have been received with the exercise of

due diligence, by the FOIA Officer. Records requested in conformance

with this subpart and which are not exempt records may be obtained in

person or by mail as specified in the request. Records to be obtained

in person will be available for inspection or copying during business

hours on a regular business day in the office of OFHEO.

(b) Description of records. Each request must reasonably describe

the desired records in sufficient detail to enable OFHEO personnel to

locate the records with a reasonable amount of effort. A request for a

specific category of records will be regarded as fulfilling this

requirement if it enables responsive records to be identified by a

technique or process that is not unreasonably burdensome or disruptive

of OFHEO operations.

(1) Whenever possible, a request should include specific

information about each record sought, such as the date, title or name,

author, recipient, and subject matter of the record.

(2) If the FOIA Officer determines that a request does not

reasonably describe the records sought, he or she will either advise

the requester what additional information is needed to locate the

record or otherwise state why the request is insufficient. The FOIA

Officer will also extend to the requester an opportunity to confer with

OFHEO personnel with the objective of reformulating the request in a

manner which will meet the requirements of this section.

Sec. 1710.14 Responses to requests.

(a) Response to initial request. The FOIA Officer of OFHEO is

authorized to grant or deny any request for a record and to determine

appropriate fees.

(b) Referral to another agency. When a requester seeks records that

originated in another Federal Government agency, OFHEO will refer the

request to the other agency for response. If OFHEO refers the request

to another agency, it will notify the requester of the referral. A

request for any records classified by some other agency will be

referred to that agency for response.

(c) Creating records. If a person seeks information from OFHEO in a

format that does not currently exist, OFHEO will make reasonable

efforts to provide the information in the format requested. OFHEO will

not create a new record of information to satisfy a request.

(d) No responsive record. If no records are responsive to the

request, the FOIA Officer will so notify the requester in writing.

Sec. 1710.15 Form and content of responses.

(a) Form of notice granting a request. After the FOIA Officer has

granted a request in whole or in part, the requester will be notified

in writing. The notice shall describe the manner in which the record

will be disclosed, whether by providing a copy of the record with the

response or at a later date, or by making a copy of the record

available to the requester for inspection at a reasonable time and

place. The procedure for such an inspection may not unreasonably

disrupt the operation of OFHEO. The response letter will also inform

the requester of any fees to be charged in accordance with the

provisions of subpart D of this part.

(b) Form of notice denying a request. When the FOIA Officer denies

a request in whole or in part, he or she will so notify the requester

in writing. The response will be signed by the FOIA Officer and will

include--

[[Page 71008]]

(1) The name and title or position of the person making the denial;

(2) A brief statement of the reason or reasons for the denial,

including the FOIA exemption or exemptions which the FOIA Officer has

relied upon in denying the request; and

(3) A statement that the denial may be appealed under Sec. 1710.16

of this subpart and a description of the requirements of that section.

Sec. 1710.16 Appeals of denials.

(a) Right of appeal. If a request has been denied in whole or in

part, the requester may appeal the denial to: FOIA Appeals Officer,

Office of Federal Housing Enterprise Oversight, 1700 G Street, NW.,

Fourth Floor, Washington, DC 20552.

(b) Letter of appeal. The appeal must be in writing and must be

sent within 30 days of receipt of the denial letter. An appeal should

include a copy of the initial request, a copy of the letter denying the

request in whole or in part, and a statement of the circumstances,

reasons, or arguments advanced in support of disclosure of the

requested record. Both the envelope and the letter of appeal must be

clearly marked ``FOIA Appeal.'' An appeal improperly addressed shall be

deemed not to have been received for purposes of the 20-day time period

set forth in paragraph (b) of Sec. 1710.17 until it is received, or

would have been received with the exercise of due diligence, by the

Appeals Officer.

(c) Action on appeal. The disposition of an appeal will be in

writing and will constitute the final action of OFHEO on a request. A

decision affirming in whole or in part the denial of a request will

include a brief statement of the reason or reasons for affirmance,

including each FOIA exemption relied on. If the denial of a request is

reversed in whole or in part on appeal, the request will be processed

promptly in accordance with the decision on appeal.

(d) Judicial review. If the denial of the request for records is

upheld in whole or in part, or, if a determination on the appeal has

not been mailed at the end of the 20-day period or the last extension

thereof, the requester is deemed to have exhausted his or her

administrative remedies, giving rise to a right of judicial review

under 5 U.S.C. 552(a)(4).

Sec. 1710.17 Time limits.

(a) Initial request. Following receipt of a request for records,

the FOIA Officer will determine whether to comply with the request and

will notify the requester in writing of his or her determination within

20 days (excluding Saturdays, Sundays, and legal holidays) after

receipt of the request.

(b) Appeal. A written determination on an appeal submitted in

accordance with Sec. 1710.16 of this subpart will be issued within 20

days (excluding Saturdays, Sundays, and legal holidays) after receipt

of the appeal. When a determination cannot be mailed within the

applicable time limit, the appeal will nevertheless be processed. In

such case, upon the expiration of the time limit, the requester will be

informed of the reason for the delay, of the date on which a

determination may be expected to be mailed, and of that person's right

to seek judicial review. The requester may be asked to forego judicial

review until determination of the appeal.

(c) Extension of time limits. The time limits specified in either

paragraph (a) or (b) of this section may be extended in unusual

circumstances up to a total of 10 days (excluding Saturdays, Sundays,

and legal holidays) after written notice to the requester setting forth

the reasons for the extension and the date on which a determination is

expected to be made. As used in this paragraph, unusual circumstances

means that there is a need to--

(1) Search for and collect the requested records from facilities

that are separate from the office processing the request;

(2) Search for, collect, and appropriately examine a voluminous

amount of separate and distinct records which are demanded in a single

request; or

(3) Consult with another agency having a substantial interest in

the determination of the request, or consult with various offices

within OFHEO that have a substantial interest in the records requested.

Sec. 1710.18 Special procedures for business information.

(a) In general. Business information provided to OFHEO by a

business submitter shall not be disclosed pursuant to an FOIA request

except in accordance with this section.

(b) Definitions. For the purpose of this section, the following

definitions shall apply:

(1) Business information means trade secrets or other commercial or

financial information, provided to OFHEO by a submitter, which arguably

is protected from disclosure under Exemption 4 of the FOIA, 5 U.S.C.

552(b)(4), because disclosure could reasonably be expected to cause

substantial competitive harm.

(2) Business submitter means any person or entity which provides

business information, directly or indirectly, to OFHEO and who has a

proprietary interest in the information.

(c) Designation of business information. Submitters of business

information should use good-faith efforts to designate, by appropriate

markings, either at the time of submission or at a reasonable time

thereafter, those portions of their submissions which they deem to be

protected under Exemption 4 of the FOIA, 5 U.S.C. 552(b)(4). Any such

designation will expire 10 years after the records were submitted to

the Government, unless the submitter requests, and provides reasonable

justification for, a designation period of longer duration.

(d) Predisclosure notification. (1) Except as is provided for in

paragraph (i) of this section, the FOIA Officer shall, to the extent

permitted by law, provide a submitter with prompt written notice of an

FOIA request or administrative appeal encompassing its business

information whenever required under paragraph (e) of this section. Such

notice shall either describe the exact nature of the business

information requested or provide copies of the records or portions

thereof containing the business information.

(2) Whenever the FOIA Officer provides a business submitter with

the notice set forth in paragraph (e)(1) of this section, the FOIA

Officer shall notify the requester that the request includes

information that may arguably be exempt from disclosure under 5 U.S.C.

552(b)(4) and that the person or entity who submitted the information

to OFHEO has been given the opportunity to comment on the proposed

disclosure of information.

(e) When notice is required. OFHEO shall provide a business

submitter with notice of a request whenever--

(1) The business submitter has in good faith designated the

information as business information deemed protected from disclosure

under 5 U.S.C. 552(b)(4); or

(2) OFHEO has reason to believe that the request seeks business

information the disclosure of which may result in substantial

commercial or financial injury to the business submitter.

(f) Opportunity to object to disclosure. Through the notice

described in paragraph (d) of this section, OFHEO shall, to the extent

permitted by law, afford a business submitter at least 10 days

(excluding Saturdays, Sundays, and legal holidays) within which it can

provide OFHEO with a detailed written statement of any objection to

disclosure. Such statement shall demonstrate why the information is

contended to be a trade secret or commercial or financial

[[Page 71009]]

information that is privileged or confidential and why disclosure would

cause competitive harm. Whenever possible, the business submitter's

claim of confidentiality should be supported by a statement or

certification by an officer or authorized representative of the

business submitter. Information provided by a submitter pursuant to

this paragraph may itself be subject to disclosure under the FOIA.

(g) Notice of intent to disclose. (1) The FOIA Officer shall

consider carefully a business submitter's objections and specific

grounds for nondisclosure prior to determining whether to disclose

business information. Whenever the FOIA Officer decides to disclose

business information over the objection of a business submitter, the

FOIA Officer shall forward to the business submitter a written notice

at least 10 days (excluding Saturdays, Sundays, and legal holidays)

before the date of disclosure containing--

(i) A statement of the reasons for which the business submitter's

disclosure objections were not sustained,

(ii) A description of the business information to be disclosed, and

(iii) A specified disclosure date.

(2) Such notice of intent to disclose likewise shall be forwarded

to the requester at least 10 days (excluding Saturdays, Sundays, and

legal holidays) prior to the specified disclosure date.

(h) Notice of FOIA lawsuit. Whenever a requester brings suit

seeking to compel disclosure of business information, the FOIA Officer

shall promptly notify the business submitter of such action.

(i) Exceptions to predisclosure notification. The requirements of

this section shall not apply if--

(1) The FOIA Officer determines that the information should not be

disclosed;

(2) The information lawfully has been published or has been

officially made available to the public;

(3) Disclosure of the information is required by law (other than 5

U.S.C. 552); or

(4) The designation made by the submitter in accordance with

paragraph (c) of this section appears obviously frivolous; except that,

in such a case, the FOIA Officer will provide the submitter with

written notice of any final decision to disclose business information

within a reasonable number of days prior to a specified disclosure

date.

Subpart D--Fees for Provision of Information

Sec. 1710.21 Definitions.

For the purpose of this subpart, the following definitions shall

apply:

(a) Commercial use request means a request for information that is

from, or on behalf of, a requester seeking information for a use or

purpose that furthers the commercial, trade, or profit interests of the

requester or the person on whose behalf the request is being made. To

determine whether a request is properly classified as a commercial use

request, OFHEO shall determine the purpose for which the requested

records shall be used. If OFHEO has reasonable cause to doubt the

purpose specified in the request for which a requester will use the

records sought, or where the purpose is not clear from the request

itself, OFHEO shall seek additional clarification before assigning the

request to a specified category.

(b) Direct costs means the expenditures actually incurred by OFHEO

in searching for and reproducing records to respond to a request for

information. In the case of a commercial use request, the term also

means those expenditures OFHEO actually incurs in reviewing records to

respond to the request. The direct cost shall include the salary of the

employee performing work (the basic rate of pay for the employee plus

16 percent of that rate to cover benefits) and the cost of operating

duplication equipment. Not included in direct costs are overhead

expenses such as costs of space, and heating or lighting the facility

in which the records are stored.

(c) Educational institution means a preschool, a public or private

elementary or secondary school, an institution of undergraduate higher

education, an institution of graduate higher education, an institution

of professional education, and an institution of vocational education,

which operates a program or programs of scholarly research.

(d) Noncommercial scientific institution refers to an institution

that is not operated on a commercial, trade, or profit basis and which

is operated solely for the purpose of conducting scientific research,

the results of which are not intended to promote any particular product

or industry.

(e) Representative of the news media means any person actively

gathering news for an entity that is organized and operated to publish

or broadcast news to the public. The term ``news'' means information

that is about current events or that would be of current interest to

the public. Examples of news media entities include television or radio

stations broadcasting to the public at large and publishers of

periodicals (but only in those instances in which the periodicals can

qualify as disseminators of ``news'') who make their products available

for purchase or subscription by the general public. These examples are

not intended to be all-inclusive. As traditional methods of news

delivery evolve, e.g., electronic dissemination of newspapers through

telecommunication services, such alternative media, would be included

in this category. ``Freelance'' journalists may be regarded as working

for a news organization if they can demonstrate a solid basis for

expecting publication through that organization even though they are

not actually employed by the organization. A publication contract would

be the clearest proof that a journalist is working for a news

organization, but OFHEO may look to the requester's past publication

record to determine whether a journalist is working for a news

organization.

(f) Reproduce and reproduction means the process of making a copy

of a record necessary to respond to a request for information. Such

copies take the form of paper copy, microfilm, audio-visual materials,

or machine readable documentation, e.g., magnetic tape or disk. The

copy provided shall be in a form that is reasonably usable by

requesters.

(g) Review means the process of examining records located in

response to a request for information to determine whether any portion

of any record located is permitted to be withheld. It also includes

processing any records for disclosure, e.g., doing all that is

necessary to prepare the records for release. The term ``review'' does

not include the time spent resolving general legal or policy issues

regarding the application of exemptions. OFHEO shall only charge fees

for reviewing records in response to a commercial use request.

(h) The term search includes all time spent looking for material

that is responsive to a request for information, including page-by-page

or line-by-line identification of material within records. The term

``search'' includes the extraction of information from a computer using

existing programming. Searching for materials shall be done in the most

efficient and least expensive manner so as to minimize the costs of

OFHEO and the requester. For example, a line-by-line search for

responsive material should not be performed when merely reproducing an

entire document would be less expensive and the faster method of

complying with the request for information. A ``search'' for material

that is responsive to a request should be distinguished from a

``review'' of material to determine whether the material is exempt from

disclosure.

[[Page 71010]]

Sec. 1710.22 Fees to be charged--general.

(a) Policy. Generally, the fees charged for requests for records

pursuant to 5 U.S.C. 552 shall cover the full allowable direct costs of

searching for, reproducing, and reviewing records that are responsive

to a request for information. Fees shall be assessed according to the

schedule contained in paragraph (b) of this section and the category of

requesters described in Sec. 1710.23 of this subpart for services

rendered by OFHEO staff in responding to, and processing requests for,

records under this part. Fees assessed will be paid by check or money

order payable to the Office of Federal Housing Enterprise Oversight.

(b) Types of charges. The types of charges that may be assessed in

connection with the production of records in response to an FOIA

request are as follows:

(1) Searches. (i) Manual searches for records. Whenever feasible,

OFHEO will charge at the salary rate(s), i.e., basic pay plus 16

percent, of the employee(s) making the search. Charges for search time

will be billed by 15-minute segments.

(ii) Computer searches for records. Requesters will be charged at

the actual direct costs of conducting a search using existing

programming. These direct costs will include the cost of operating the

central processing unit for that portion of operating time that is

directly attributable to searching for records and the operator/

programmer salary, i.e., basic pay plus 16 percent, apportionable to

the search. A charge shall also be made for any substantial amounts of

special supplies or materials used to contain, present, or make

available the output of computers, based upon the prevailing levels of

costs to OFHEO for the type and amount of such supplies of materials

that are used. Nothing in this paragraph shall be construed to entitle

any person or entity, as of right, to any services in connection with

computerized records, other than services to which such person or

entity may be entitled under the provisions of this subpart. OFHEO will

not alter or develop programming to conduct a search.

(iii) Unproductive searches. OFHEO will charge search fees even if

no records are found which are responsive to the request or if the

records found are exempt from disclosure.

(2) Duplication. Records will be reproduced at a rate of $.15 per

page. For copies prepared by computer, such as tapes or printouts, the

requester shall be charged the actual cost, including operator time, of

production of the tape or printout. For other methods of reproduction,

the actual direct costs of reproducing the record(s) shall be charged.

(3) Review. Only requesters who are seeking records for commercial

use may be charged for time spent reviewing records to determine

whether they are exempt from mandatory disclosure. Charges may be

assessed only for initial review, i.e., the review undertaken the first

time OFHEO analyzes the applicability of a specific exemption to a

particular record or portion of a record. Records or portions of

records withheld in full under an exemption that is subsequently

determined not to apply may be reviewed again to determine the

applicability of other exemptions not previously considered. The costs

for such a subsequent review are properly assessable.

(4) Other services and materials. Where OFHEO elects, as a matter

of administrative discretion, to comply with a request for a special

service or materials, such as certifying that records are true copies

or sending records by special methods, the actual direct costs of

providing the service or materials will be charged.

Sec. 1710.23 Fees to be charged--categories of requesters.

(a) Fees for various requester categories. Paragraphs (b) through

(e) of this section state, for each category of requester, the types of

fees generally charged by OFHEO. However, for each of these categories,

the fees may be limited, waived or reduced in accordance with the

provisions set forth in paragraph (c) of Sec. 1710.24. If OFHEO has

reasonable cause to doubt the purpose specified in the request for

which a requester will use the records sought, or where the purpose is

not clear from the request itself, OFHEO will seek clarification before

assigning the request a specific category.

(b) Commercial use requester. OFHEO shall charge fees for records

requested by persons or entities making a commercial use request in an

amount that equals the full direct costs for searching for, reviewing

for release, and reproducing the records sought. Commercial use

requesters are not entitled to 2 hours of free search time nor 100 free

pages of reproduction of records. In accordance with Sec. 1710.22,

commercial use requesters may be charged the costs of searching for and

reviewing records even if there is ultimately no disclosure of records.

(c) Educational and noncommercial scientific institutions. OFHEO

shall charge fees for records requested by, or on behalf of,

educational institutions and noncommercial scientific institutions in

an amount which equals the cost of reproducing the records responsive

to the request, excluding the cost of reproducing the first 100 pages.

No search fee shall be charged with respect to requests by educational

and noncommercial scientific institutions. For a request to be included

in this category, requesters must show that the request being made is

authorized by and under the auspices of a qualifying institution, and

that the records are not sought for commercial use but are sought in

furtherance of scholarly research (if the request is from an

educational institution) or scientific research (if the request is from

a noncommercial scientific institution).

(d) News media. OFHEO shall charge fees for records requested by

representatives of the news media in an amount which equals the cost of

reproducing the records responsive to the request, excluding the costs

of reproducing the first 100 pages. No search fee shall be charged with

respect to requests by representatives of the news media. For a request

to be included in this category, the requester must qualify as a

representative of the news media and the request must not be made for a

commercial use. A request for records supporting the news dissemination

function of the requester shall not be considered to be a request that

is for commercial use.

(e) All other requesters. OFHEO shall charge fees for records

requested by persons or entities that are not classified in any of the

categories listed in paragraphs (b), (c), or (d) of this section in an

amount that equals the full reasonable direct cost of searching for and

reproducing records that are responsive to the request, excluding the

first 2 hours of search time and the cost of reproducing the first 100

pages of records. In accordance with Sec. 1710.22, requesters in this

category may be charged the cost of searching for records even if there

is ultimately no disclosure of records, excluding the first 2 hours of

search time.

(f) For purposes of the exceptions contained in this section on

assessment of fees, the word ``pages'' refers to paper copies of 8\1/2\

x 11 or 11 x 14. Thus, requesters are not entitled to 100

microfiche or 100 computer disks, for example. A microfiche containing

the equivalent of 100 pages or a computer disk containing the

equivalent of 100 pages of computer printout meets the terms of the

exception.

(g) For purposes of paragraph (e) of this section, the term

``search time'' has as its basis, manual search. To apply this term to

searches made by computer, OFHEO will determine the hourly cost

[[Page 71011]]

of operating the central processing unit and the operator's hourly

salary plus 16 percent. When the cost of the search (including the

operator time and the cost of operating the computer to process a

request) equals the equivalent dollar amount of 2 hours of the salary

plus 16 percent of the person performing the search, i.e., the

operator, OFHEO will begin assessing charges for the computer.

Sec. 1710.24 Limitations on charging fees.

(a) In general. Except for requesters seeking records for a

commercial use as described in paragraph (b) of Sec. 1710.23, OFHEO

will provide, without charge, the first 100 pages of duplication and

the first 2 hours of search time, or their cost equivalent.

(b) No fee charged. OFHEO will not charge fees to any requester,

including commercial use requesters, if the cost of collecting a fee

would be equal to or greater than the fee itself. The elements to be

considered in determining the ``cost of collecting a fee'' are the

administrative costs of receiving and recording a requester's

remittance and of processing the fee.

(c) Waiver or reduction of fees. OFHEO may grant a waiver or

reduction of fees if OFHEO determines that the disclosure of the

information is in the public interest because it is likely to

contribute significantly to public understanding of the operations or

activities of the Federal Government, and the disclosure of the

information is not primarily in the commercial interest of the

requester. Requests for a waiver or reduction of fees will be

considered on a case-by-case basis.

(1) The following factors will be considered by OFHEO in

determining whether a waiver or reduction of fees is in the public

interest:

(i) The subject of the request: Whether the subject of the

requested records concerns ``the operations or activities of the

Government.'' The subject matter of the requested records, in the

context of the request, must specifically concern identifiable

operations or activities of the Federal Government with a connection

that is direct and clear, not remote or attenuated. Furthermore, the

records must be sought for their informative value with respect to

those Government operations or activities; a request for access to

records for their intrinsic informational content alone will not

satisfy this threshold consideration.

(ii) The informative value of the information to be disclosed:

Whether the disclosure is ``likely to contribute'' to an understanding

of Government operations or activities. The disclosable portions of the

requested records must be meaningfully informative on specific

Government operations or activities in order to hold potential for

contributing to increased public understanding of those operations and

activities. The disclosure of information that is already in the public

domain, in either a duplicative or substantially identical form, would

not be likely to contribute to such understanding, as nothing new would

be added to the public record.

(iii) The contribution to an understanding of the subject by the

general public: Whether disclosure of the requested information will

contribute to the ``public understanding.'' The disclosure must

contribute to the understanding of the public at large, as opposed to

the individual understanding of the requester or a narrow segment of

interested persons. A requester's identity and qualifications, e.g.,

expertise in the subject area and ability and intention to convey

information to the general public, will be considered.

(iv) The significance of the contribution in public understanding:

Whether the disclosure is likely to ``significantly enhance'' the

public understanding of Government operations or activities. The

public's understanding of the subject matter in question, as compared

to the level of public understanding existing prior to the disclosure,

must be likely to be enhanced by the disclosure to a significant

extent. The FOIA Officer shall not make a separate value judgment as to

whether information, even though it in fact would contribute

significantly to public understanding of the operations or activities

of the Government, is ``important'' enough to be made public.

(2) In order to determine whether the second fee waiver requirement

is met, i.e., that disclosure of the requested information is not

primarily in the commercial interest of the requester, OFHEO shall

consider the following two factors in sequence:

(i) The existence and magnitude of a commercial interest: Whether

the requester, or any person on whose behalf the requester may be

acting, has a commercial interest that would be furthered by the

requested disclosure. In assessing the magnitude of identified

commercial interests, consideration will be given to the effect that

the information disclosed would have on those commercial interests, as

well as to the extent to which FOIA disclosures serve those interests

overall. Requesters shall be given a reasonable opportunity in the

administrative process to provide information bearing upon this

consideration.

(ii) The primary interest in disclosure: Whether the magnitude of

the identified commercial interest of the requester is sufficiently

large in comparison with the public interest in disclosure, that

disclosure is ``primarily in the commercial interest of the

requester.'' A fee waiver or reduction is warranted only where, once

the ``public interest'' standard set out in paragraph (c)(1) of this

section is satisfied, that public interest can fairly be regarded as

greater in magnitude than that of the requester's commercial interest

in disclosure. OFHEO will ordinarily presume that, where a news media

requester has satisfied the public interest standard, the public

interest will be serviced primarily by disclosure to that requester.

Disclosure to requesters who compile and market Federal Government

information for direct economic return will not be presumed to

primarily serve the ``public interest.''

(3) Where only a portion of the requested record satisfies the

requirements for a waiver or reduction of fees under this paragraph, a

waiver or reduction shall be granted only as to that portion.

(4) A request for a waiver or reduction of fees must accompany the

request for disclosure of records and should include--

(i) A clear statement of the requester's interest in the records;

(ii) The proposed use of the records and whether the requester will

derive income or other benefit from such use;

(iii) A statement of how the public will benefit from release of

the requested records; and

(iv) If specialized use of the documents is contemplated, a

statement of the requester's qualifications that are relevant to the

specialized use.

(5) A requester may appeal the denial of a request for a waiver or

reduction of fees in accordance with the provisions of Sec. 1710.16.

Sec. 1710.25 Miscellaneous fee provisions.

(a) Notice of anticipated fees in excess of $25.00. Where OFHEO

determines or estimates that the fees chargeable will amount to more

than $25.00, OFHEO shall promptly notify the requester of the actual or

estimated amount of fees or such portion thereof that can be readily

estimated, unless the requester has indicated his or her willingness to

pay fees as high as those anticipated. Where a requester has been

notified that the actual or estimated fees may exceed $25.00, the

request will be deemed not to have been received until the requester

has agreed to pay the anticipated total

[[Page 71012]]

fee. A notice to the requester pursuant to this paragraph will include

the opportunity to confer with OFHEO personnel in order to reformulate

the request to meet the requester's needs at a lower cost.

(b) Aggregating requests. A requester may not file multiple

requests at the same time, each seeking portions of a record or

records, solely in order to avoid the payment of fees. When OFHEO

reasonably believes that a requester, or a group of requesters acting

in concert, is attempting to break a request into a series of requests

for the purpose of evading the assessment of fees, OFHEO may aggregate

such requests and charge accordingly. One element to be considered in

determining whether a belief would be reasonable is the time period

over which the requests have occurred. OFHEO will presume that multiple

requests of this type made within a 30-day period have been made in

order to evade fees. Where requests are separated by a longer period,

OFHEO shall aggregate them only where there exists a solid basis for

determining that such aggregation is warranted, e.g., where the

requests involve clearly related matters. Multiple requests regarding

unrelated matters will not be aggregated.

(c) Advance payment of fees. (1) OFHEO does not require an advance

payment before work is commenced or continued, unless--

(i) OFHEO estimates or determines that the fees are likely to

exceed $250.00. If it appears that the fees will exceed $250.00, OFHEO

will notify the requester of the likely cost and obtain satisfactory

assurance of full payment where the requester has a history of prompt

payment of FOIA fees. In the case of requesters with no history of

payment, OFHEO may require an advance payment of fees in an amount up

to the full estimated charge that will be incurred; or

(ii) The requester has previously failed to pay a fee in a timely

fashion, i.e., within 30 days of the date of a billing. In such cases,

OFHEO may require the requester to pay the full amount owed plus any

applicable interest, as provided in paragraph (d) of this section, or

demonstrate that the fee owed has been paid, prior to processing any

further record request. Under these circumstances, OFHEO may require

the requester to make an advance payment of the full amount of the fees

anticipated before processing a new request or finishing processing of

a pending request from that requester.

(2) A request for an advance deposit shall include an offer to the

requester to confer with identified OFHEO personnel to attempt to

reformulate the request in a manner which will meet the needs of the

requester at a lower cost.

(3) When OFHEO requests an advance payment of fees, the

administrative time limits described in 5 U.S.C. 552(a)(6) begin only

after OFHEO has received the advance payment.

(d) Interest. OFHEO may assess interest charges on an unpaid bill

starting on the 31st day following the day on which the bill was sent.

Once a fee payment has been received by OFHEO, even if not processed,

the accrual of interest shall be stayed. Interest charges shall be

assessed at the rate prescribed in 31 U.S.C. 3717 and shall accrue from

the date of the billing.

Subpart E--Testimony and Production of Documents in Legal

Proceedings in Which OFHEO Is Not a Named Party

Sec. 1710.31 General purposes.

The purposes of this subpart are to maintain the confidentiality of

official documents and information of OFHEO, conserve the time of

employees for their official duties, maintain the impartial position of

OFHEO in litigation in which OFHEO is not a named party, and enable the

Director to determine when to authorize testimony and to produce

documents in legal proceedings in which OFHEO is not a named party.

This subpart sets forth the procedures to be followed with respect to

testimony concerning official matters and production of official

documents of OFHEO in legal proceedings in which OFHEO is not a named

party. This subpart in no way affects the rights and procedures

governing public access to official documents pursuant to the FOIA or

the Privacy Act.

Sec. 1710.32 Definitions.

For the purpose of this subpart:

(a) Court means any entity conducting a legal proceeding.

(b) Demand means any order, subpoena, or other legal process for

testimony or documents.

(c) Legal proceeding means any administrative, civil, or criminal

proceeding, including a discovery proceeding therein, before a court of

law, administrative board or commission, hearing officer, or other body

in which OFHEO is not a named party or in which OFHEO has not

instituted the administrative investigation or administrative hearing.

(d) OFHEO Counsel means the General Counsel or his or her designee,

a Department of Justice attorney, or counsel authorized by OFHEO to act

on behalf of OFHEO or an employee.

Sec. 1710.33 General policy.

It is the policy of OFHEO that in any legal proceeding in which

OFHEO is not a named party, no employee shall, in response to a demand,

produce any documents contained in the files of OFHEO, or disclose any

information relating to, or based upon, documents contained in the

files of OFHEO, or disclose or produce any documents acquired as part

of the performance of that employee's official duties or because of

that employee's official status. Under appropriate circumstances, the

Director may grant exceptions in writing to this policy when the

Director determines that the testimony of employees or disclosure of

official documents would be in the best interest of OFHEO or in the

public interest. Prior to any authorized testimony or release of

official documents, the requesting party shall obtain a protective

order from the court before which the action is pending to preserve the

confidentiality of the testimony or documents subsequently produced.

The protective order shall be in a form satisfactory to OFHEO.

Sec. 1710.34 Request for testimony or production of documents.

(a) No employee shall give testimony concerning official matters or

produce any official documents in any legal proceeding to which OFHEO

is not a named party without the prior written authorization of the

Director.

(b) If testimony by an employee concerning official matters or the

production of official documents is desired, the requesting party, or

his or her attorney, shall submit a letter to the Director setting

forth the title of the case, the forum, the requesting party's interest

in the case, a summary of the issues in the litigation, the reasons for

the request, and a showing that the desired testimony, documents, or

information are not reasonably available from any other source. If an

appearance or testimony is requested, the letter shall also set forth

the intended use of the testimony, a general summary of the scope of

the testimony requested, and a showing that no document could be

provided and used in lieu of the testimony or other appearance

requested.

(c) The General Counsel is authorized to consult with the

requesting party or his or her attorney to refine and limit the request

so that compliance is less burdensome, or obtain information necessary

to make the determination described in Sec. 1710.33 of this subpart.

Failure of the requesting party, or his or her attorney, to cooperate

in good faith with the General Counsel to enable the

[[Page 71013]]

Director to make an informed determination under this subpart may serve

as the basis for a determination not to comply with the request.

Sec. 1710.35 Scope of permissible testimony.

(a) The scope of permissible testimony by an employee is limited to

that set forth in the written authorization granted that employee by

the Director.

(b) Employees are not authorized to give opinion testimony, except

as authorized by the Director. OFHEO, as the regulatory agency charged

with the responsibility of examining, supervising, and regulating the

financial safety and soundness and capital adequacy of the Enterprises

under the Federal Housing Enterprises Financial Safety and Soundness

Act of 1992, 12 U.S.C. 4501 et seq., relies on the ability of its

employees to gather full and complete information in order to carry out

its statutory responsibilities. The use of employees to give opinion

testimony would hamper OFHEO's ability to carry out its statutory

responsibilities and would cause a serious administrative burden on

OFHEO's staff.

Sec. 1710.36 Manner in which testimony is given.

(a) Authorized testimony of employees ordinarily will be made

available only through depositions or written interrogatories.

(b) Where, in response to a request, the Director determines that

circumstances warrant authorizing testimony by an employee, the

requesting party shall cause a subpoena to be served on the employee in

accordance with applicable Federal or State rules of procedure, with a

copy of the subpoena sent by registered or certified mail to the

General Counsel.

(c) Normally, authorized depositions will be taken at OFHEO's

office, at a time arranged with the employee that is reasonably fixed

to avoid substantial interference with the performance of the

employee's duties.

(d) Upon completion of the deposition of an employee, a copy of the

transcript of the testimony shall be furnished, at the expense of the

party requesting the deposition, to the General Counsel for OFHEO's

files.

Sec. 1710.37 Manner in which documents will be produced.

(a) An employee's authorization to produce official documents is

limited to the authority granted that employee by the Director.

(b) Certified or authenticated copies of official OFHEO documents

authorized by the Director to be released under this subpart will be

provided upon request.

Sec. 1710.38 Fees.

Unless waived or reduced, the following fees shall be charged for

documents produced by OFHEO in connection with requests subject to this

subpart:

(a) Searches for documents. OFHEO will charge at the salary

rates(s), i.e., basic pay plus 16 percent, of the employee(s) making

the search. Charges for search time will be billed by 15 minute

segments.

(b) Copying of documents. The standard copying charge for documents

in paper copy is $.15 per page. When responsive information is provided

in a format other than paper copy, such as in the form of computer

tapes and disks, OFHEO will assess the direct costs of the tape, disk,

or whatever medium is used to produce the information, as well as any

related reproduction costs. Normally, only one copy will be provided.

Additional copies will be provided only upon a showing of demonstrated

need.

(c) Certification or authentication of documents. OFHEO will charge

$3.00 for each certification or authentication of documents.

(d) Computer searches. Services of personnel in the nature of a

computer search shall be charged at rates prescribed in paragraph (a)

of this section. A charge shall be made for the computer time involved,

based upon the prevailing level of costs to OFHEO and upon the

particular types of computer and associated equipment and the amount of

time that such equipment is utilized. A charge shall also be made for

any substantial amount of special supplies or documents used to

contain, present, or make available the output of computers, based upon

prevailing levels of costs to OFHEO and upon the type and amount of

such supplies or documents that are used.

(e) Other costs. When other services and documents not specifically

identified in this section are requested and provided, their actual

cost to OFHEO shall be charged.

(f) Payments of fees. A bill will be forwarded to the requesting

party upon completion of the production. Payment shall be made by check

or money order payable to the Office of Federal Housing Enterprise

Oversight.

Sec. 1710.39 Responses to demands served on employees.

(a) Advice by employee served. Any employee who is served with a

demand in a legal proceeding requiring his or her personal attendance

as a witness or requiring the production of documents or information in

any proceeding, shall immediately notify the General Counsel of such

service, of the testimony and documents described in the demand, and of

all relevant facts which may be of assistance to the General Counsel in

determining whether the individual in question should be authorized to

testify or the documents requested should be made available.

(b) When authorization to testify or to produce documents has not

been granted by the Director, OFHEO Counsel shall provide the party

issuing the demand or the court with a copy of the regulations

contained in this subpart and shall inform the party issuing the demand

or the court that the employee upon whom the demand has been made is

prohibited from testifying or producing documents without the prior

approval of the Director.

(c) Appearance by employee served. Unless OFHEO has authorized

disclosure of the information requested, any employee who has OFHEO

information that may not be disclosed and who is required to respond to

a subpoena or other legal process, shall attend at the time and place

required and respectfully decline to disclose or to give any testimony

with respect to the information, basing such refusal upon the

provisions of this subpart. If the court nevertheless orders the

disclosure of the information or the giving of testimony irrespective

of instructions from the Director not to produce the documents or

disclose the information sought, the employee upon whom the demand has

been made shall continue to decline respectfully to disclose the

information and shall report promptly the facts to OFHEO for such

action as OFHEO may deem appropriate.

(d) A determination under this subpart to comply or not to comply

with any demand shall not constitute an assertion or waiver of

privilege, lack of relevance, technical deficiencies, or any other

ground for noncompliance. OFHEO reserves the right to oppose any demand

on any legal ground independent of its determination under this

subpart.

Sec. 1710.40 Responses to demands served on nonemployees.

(a) OFHEO reports of examinations, or any documents related

thereto, are the property of OFHEO and are not to be disclosed to any

person without the Director's prior written consent.

(b) If any person who has possession of an OFHEO report of

examination, or any documents related thereto, is served with a demand

in a legal proceeding directing that person to produce such

[[Page 71014]]

OFHEO documents or to testify with respect thereto, such person shall

immediately notify the General Counsel of such service, of the

testimony and described documents in the demand, and of all relevant

facts. Such person shall also object to the production of such

documents or information contained therein on the basis that the

documents are the property of OFHEO and cannot be released without

OFHEO's consent and that their production must be sought from OFHEO

following the procedures set forth in Sec. 1710.33, paragraphs (b) and

(c) of Sec. 1710.34, and paragraph (b) of Sec. 1710.37 of this subpart.

Subpart F--Rules and Procedures for Service Upon OFHEO

Sec. 1710.51 Service of process.

(a) Except as otherwise provided by OFHEO regulations, the Federal

Rules of Civil Procedure, or order of a court with jurisdiction over

OFHEO, any legal process upon OFHEO, including a legal process served

on OFHEO demanding access to its records under the FOIA, shall be duly

issued and served upon the General Counsel and any OFHEO personnel

named in the caption of the documents.

(b) Service of process upon the General Counsel may be effected by

personally delivering a copy of the documents to the General Counsel or

by sending a copy of the documents to the General Counsel by registered

or certified mail, postage prepaid, to the Office of Federal Housing

Enterprise Oversight, 1700 G Street, NW., Fourth Floor, Washington, DC

20552.

Dated: December 17, 1998.

Mark Kinsey,

Acting Director, Office of Federal Housing Enterprise Oversight.

[FR Doc. 98-33943 Filed 12-22-98; 8:45 am]

BILLING CODE 4220-01-U