Single Family Mortgage Insurance; Appraiser Roster Placement Procedures

SUMMARY: This final rule adopts certain of the provisions concerning

HUD's Appraiser Roster that were published for public comment in a

proposed rule on July 2, 1999. The Appraiser Roster lists appraisers

who are eligible to perform Federal Housing Administration single

family appraisals. The provisions adopted by this final rule codify the

current Appraiser Roster placement procedure. The provisions published

in the proposed rule concerning the Appraiser Roster removal procedure

are being further considered by HUD and will be addressed in a separate

rulemaking.

DATES: Effective Date: January 27, 2000.

FOR FURTHER INFORMATION CONTACT: Vance T. Morris, Director, Home

Mortgage Insurance Division, Office of Insured Single Family Housing,

Room 9266, U.S. Department of Housing and Urban Development, 451

Seventh Street, SW, Washington, DC 20410-8000; telephone (202) 708-2700

(this is not a toll-free number). Hearing- or speech-impaired

individuals may access this number via TTY by calling the toll-free

Federal Information Relay Service at (800) 877-8339.

SUPPLEMENTARY INFORMATION:

I. HUD's Appraiser Roster

HUD's Appraiser Roster lists appraisers who are eligible to perform

Federal Housing Administration (FHA) single family appraisals. HUD

maintains the Appraiser Roster to provide a means by which HUD can

monitor the quality of appraisals performed on single family homes

financed through FHA single family programs and to ensure that

appraisers performing FHA appraisals meet high competency standards.

The Appraiser Roster is an important part of the FHA Single Family

Mortgage Insurance program because accurate appraisals are vital to the

success of the Program and HUD's ability to protect the FHA insurance

funds.

II. The July 2, 1999 Proposed Rule

On July 2, 1999, HUD published for public comment a proposed rule

(64 FR 36216) that would have codified the current placement procedure

for HUD's Appraiser Roster and proposed an independent procedure for

removing an appraiser from the Appraiser Roster. HUD proposed this

independent removal procedure, separate and apart from HUD's existing

debarment, suspension, and limited denial of participation

administrative remedies, in order to better safeguard the FHA insurance

funds and to better protect homebuyers. A complete description of these

procedures is presented in the preamble to the July 2, 1999 proposed

rule.

III. This Final Rule

This final rule adopts certain of the provisions concerning HUD's

Appraiser Roster published in the July 2, 1999 proposed rule.

Specifically, this final rule adopts the provisions that codify the

current Appraiser Roster placement procedure. This final rule does not

adopt the independent removal procedure nor certain other related

provisions. A summary of the provisions adopted by this final rule is

presented in section V. of this preamble.

The public comment period for the proposed rule closed on August 2,

1999. HUD received 2 comments. We received one comment from a banking

institution and the other from a trade association. One of the

commenters wrote in favor of the proposed rule. The other commenter

raised a number of concerns about the proposed removal procedure.

Neither commenter raised issues concerning the codification of HUD's

current placement procedure. Consequently, HUD is adopting this

procedure without change.

HUD, however, has decided not to adopt the proposed independent

removal procedure in this final rule.

IV. Plain Language

Please note that the structure of the proposed rule has been

revised in this final rule to comply with President Clinton's

Memorandum of June 1, 1998, entitled ``Plain Language in Government''

(63 FR 31885). In this memorandum, President Clinton directed Federal

agencies to use plain language in all government writing. With respect

to rulemaking, President Clinton directed Federal agencies to use plain

language in new proposed and final rules beginning January 1, 1999.

Plain language is an approach to writing that promotes responsive,

accessible, and understandable written communications.

In particular, the structure of this final rule has been revised to

present the rule in question-and-answer format. This was done to

improve clarity and to make the regulations more user-friendly. The

substance of each section, however, as proposed in the July 2, 1999

rule, has not been changed. In addition, some of the proposed

regulatory language has been revised. Again, these revisions do not

change the substance of each section. The revisions are also intended

to improve the clarity of the final rule.

V. Summary of Provisions Adopted by this Final Rule

The following table presents a summary of the provisions adopted by

the final rule. The table also serves as a guide to the plain language

organizational changes implemented by the final rule. The first column

of the table lists the provisions of the proposed rule. If the

provision has been adopted by this final rule, the second column lists

where in the new organization the provision appears. If the provision

has not been adopted, the second column indicates that the provision

has not been adopted by the final rule.

------------------------------------------------------------------------

Adopted by this final rule

Provision in proposed rule * * * at * * *

------------------------------------------------------------------------

Sec. 200.200(a).......................... Sec. 200.200(a)

Sec. 200.200(b).......................... Sec. 200.200(b)

Sec. 200.200(c).......................... Sec. 200.202

Sec. 200.200(d).......................... Not adopted by this final

rule.

Sec. 200.200(e).......................... Sec. 200.206

Sec. 200.200(f).......................... Not adopted by this final

rule.

Sec. 200.200(g).......................... Not adopted by this final

rule.

Sec. 200.200(h).......................... Not adopted by this final

rule.

------------------------------------------------------------------------

VI. Findings and Certifications

Paperwork Reduction Act Statement

The information collection requirements contained in this rule have

been submitted to the Office of Management and Budget (OMB) under the

Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) and assigned OMB

control number 2502-0538. An agency may not conduct or sponsor, and a

person is not required to respond to, a collection of information

unless the collection displays a valid control number.

Environmental Impact

This final rule does not direct, provide for assistance or loan and

mortgage insurance for, or otherwise govern or regulate, real property

acquisition, disposition, leasing, rehabilitation, alteration,

demolition, or new construction, or establish, revise or

[[Page 72869]]

provide for standards for construction or construction materials,

manufactured housing, or occupancy. Accordingly, under 24 CFR

50.19(c)(1), this final rule is categorically excluded from

environmental review under the National Environmental Policy Act of

1969 (42 U.S.C. 4321).

Regulatory Flexibility Act

The Secretary has reviewed this final rule before publication, and

by approving it certifies, in accordance with the Regulatory

Flexibility Act (5 U.S.C. 605(b)), that this final rule would not have

a significant economic impact on a substantial number of small

entities.

Unfunded Mandates Reform Act

Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C.

1531-1538) (UMRA) requires Federal agencies to assess the effects of

their regulatory actions on State, local, and tribal governments and on

the private sector. This final rule does not impose, within the meaning

of the UMRA, any Federal mandates on any State, local, or, tribal

governments or on the private sector.

Federalism Impact

Executive Order 13132 (entitled ``Federalism'') prohibits, to the

extent practicable and permitted by law, an agency from promulgating a

regulation that has federalism implications and either imposes

substantial direct compliance costs on State and local governments and

is not required by statute, or preempts State law, unless the relevant

requirements of section 6 of the Executive Order are met. This final

rule does not have federalism implications and does not impose

substantial direct compliance costs on State and local governments or

preempt State law within the meaning of the Executive Order.

VII. List of Subjects in 24 CFR Part 200

Administrative practice and procedure, Claims, Equal employment

opportunity, Fair housing, Home improvement, Housing standards,

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

community development, Minimum property standards, Mortgage insurance,

Organization and functions (Government agencies), Penalties, Reporting

and recordkeeping requirements, Social security, Unemployment

compensation, Wages.

For the reasons discussed in the preamble, HUD amends 24 CFR part

200 as follows:

PART 200--INTRODUCTION TO FHA PROGRAMS

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

follows:

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

2. Add subpart G to read as follows:

Subpart G--Appraiser Roster

Sec.

200.200 What is the Appraiser Roster?

200.202 How do I apply for placement on the Appraiser Roster?

200.204 [Reserved]

200.206 What are my responsibilities as an appraiser listed on the

Appraiser Roster?

Subpart G--Appraiser Roster

Sec. 200.200 What is the Appraiser Roster?

(a) Appraiser Roster. HUD maintains a list of appraisers. A

mortgagee must select only an appraiser from this list for the

appraisal of a property that is to be the security for an FHA-insured

single family mortgage.

(b) Disclaimer. Since an appraisal is performed to determine the

maximum insurable mortgage and to also protect the FHA insurance funds,

the inclusion of an appraiser on the Appraiser Roster does not create

or imply a warranty or endorsement to a prospective homebuyer or to any

other organization or individual by HUD of the listed appraiser nor

does it represent a warranty of any appraisal performed by the listed

appraiser. The inclusion of an appraiser on the Appraiser Roster means

only that a listed appraiser has met the qualifications and conditions,

prescribed by the Secretary, for inclusion on the Appraiser Roster.

Sec. 200.202 How do I apply for placement on the Appraiser Roster?

(a) Application. To apply for placement on the Appraiser Roster,

you must submit an application to HUD.

(b) Eligibility. To be eligible for placement on the Appraiser

Roster:

(1) You must be a state-licensed or state-certified appraiser;

(2) You must pass a HUD test on FHA appraisal methods and

reporting; and

(3) You must not be listed on:

(i) The General Service Administration's Suspension and Debarment

List;

(ii) HUD's Limited Denial of Participation List; or

(iii) HUD's Credit Alert Interactive Voice Response System.

Sec. 200.204 [Reserved]

Sec. 200.206 What are my responsibilities as an appraiser listed on

the Appraiser Roster?

All appraisers listed on the Appraiser Roster are responsible for:

(a) Obtaining and reading the HUD Appraiser Handbook (4150.2) and

any updates to the Handbook;

(b) Complying with the HUD Appraiser Handbook (4150.2), and any

updates to the Handbook, when performing all appraisals of properties

for HUD single family mortgage insurance purposes; and

(c) Complying with all other instructions and standards issued by

HUD when performing all appraisals of properties for HUD single family

mortgage insurance purposes.

Dated: December 17, 1999.

William C. Apgar,

Assistant Secretary for Housing-Federal Housing Commissioner.

[FR Doc. 99-33672 Filed 12-27-99; 8:45 am]

BILLING CODE 4210-27-P