2021-26318. Proposed Agency Information Collection Activities; Comment Request

AGENCY:

Board of Governors of the Federal Reserve System.

ACTION:

Notice, request for comment.

SUMMARY:

The Board of Governors of the Federal Reserve System (Board) invites comment on a proposal to extend for three years, without revision, the Recordkeeping and Disclosure Requirements Associated with Regulation Y for Minimum Requirements for Appraisal Management Companies (FR HY-5; OMB No. 7100-0370).

DATES:

Comments must be submitted on or before February 1, 2022.

ADDRESSES:

You may submit comments, identified by FR HY-5, by any of the following methods:

• Agency Website: https://www.federalreserve.gov/​. Follow the instructions for submitting comments at https://www.federalreserve.gov/​apps/​foia/​proposedregs.aspx.

• Email: [e-mail]. Include the OMB number or FR number in the subject line of the message.

• FAX: [phone] or [phone].

• Mail: Ann E. Misback, Secretary, Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue NW, Washington, DC 20551.

All public comments are available from the Board's website at https://www.federalreserve.gov/​apps/​foia/​proposedregs.aspx as submitted, unless modified for technical reasons or to remove personally identifiable information at the commenter's request. Accordingly, comments will not be edited to remove any confidential business information, identifying information, or contact information. Public comments may also be viewed electronically or in paper in Room 146, 1709 New York Avenue NW, Washington, DC 20006, between 9:00 a.m. and 5:00 p.m. on weekdays. For security reasons, the Board requires that visitors make an appointment to inspect comments. You may do so by calling [phone]. Upon arrival, visitors will be required to present valid government-issued photo identification and to submit to security screening in order to inspect and photocopy comments.

Additionally, commenters may send a copy of their comments to the Office of Management and Budget (OMB) Desk Officer for the Federal Reserve Board, Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Room 10235, 725 17th Street NW, Washington, DC 20503, or by fax to [phone].

FOR FURTHER INFORMATION CONTACT:

Federal Reserve Board Clearance Officer—Nuha Elmaghrabi—Office of the Chief Data Officer, Board of Governors of the Federal Reserve System, Washington, DC 20551, [phone].

SUPPLEMENTARY INFORMATION:

On June 15, 1984, OMB delegated to the Board authority under the Paperwork Reduction Act (PRA) to approve and assign OMB control numbers to collections of information conducted or sponsored by the Board. In exercising this delegated authority, the Board is directed to take every reasonable step to solicit comment. In determining whether to approve a collection of information, the Board will consider all comments received from the public and other agencies.

During the comment period for this proposal, a copy of the proposed PRA OMB submission, including the draft reporting form and instructions, supporting statement, and other documentation, will be made available on the Board's public website at https://www.federalreserve.gov/​apps/​reportforms/​review.aspx or may be requested from the agency clearance officer, whose name appears above. Final versions of these documents will be made available at https://www.reginfo.gov/​public/​do/​PRAMain,, if approved.

Request for Comment on Information Collection Proposal

The Board invites public comment on the following information collection, which is being reviewed under authority delegated by the OMB under the PRA. Comments are invited on the following:

a. Whether the proposed collection of information is necessary for the proper performance of the Board's functions, including whether the information has practical utility;

b. The accuracy of the Board's estimate of the burden of the proposed information collection, including the validity of the methodology and assumptions used;

c. Ways to enhance the quality, utility, and clarity of the information to be collected;

d. Ways to minimize the burden of information collection on respondents, including through the use of automated collection techniques or other forms of information technology; and

e. Estimates of capital or startup costs and costs of operation, maintenance, and purchase of services to provide information.

At the end of the comment period, the comments and recommendations received will be analyzed to determine the extent to which the Board should modify the proposal.

Proposal Under OMB Delegated Authority To Extend for Three Years, Without Revision, the Following Information Collection

Report title: The Recordkeeping and Disclosure Requirements Associated with Regulation Y for Minimum Requirements for Appraisal Management Companies.

Agency form number: FR HY-5.

OMB control number: 7100-0370.

Frequency: Event-generated.

Respondents: The FR HY-5 panel comprises federally regulated and state regulated appraisal management companies (AMCs) and U.S. states, except that AMCs that oversee 15 or fewer appraisers in a state or less than 25 appraisers in two or more states are exempt from these recordkeeping and disclosure requirements.

Estimated number of respondents: Section 225.193(a), 1; Section 225.192(b), 1,239; Section 225.193(b), 1,146; Section 225.195(c), 13; Section 225.196, 51.

Estimated average hours per response: Section 225.193(a), 40; Section 225.192(b), 0.08; Section 225.193(b), 1; Section 225.195(c), 2; Section 225.196, 1.

Estimated annual burden hours: Section 225.193(a), 40; Section 225.192(b), 99; Section 225.193(b), 2,292; Section 225.195(c), 26; Section 225.196, 51.

General description of report: The Board's recordkeeping and disclosure requirements associated with the minimum requirements for AMCs are found in sections 225.192, 225.193, 225.195, and 225.196 of the Board's Regulation Y, Subpart M.

Pursuant to section 225.193(a), each participating state must establish and maintain within its appraiser certifying and licensing agency a registration and supervision program with the legal authority and mechanisms to, among other things, review and approve or deny an AMC's application for initial registration; require AMCs to submit reports, information, and documents; and report violations of appraisal-related laws, regulations, or orders, as well as disciplinary and enforcement actions, to the Appraisal Subcommittee (ASC) of the Federal Financial Institutions Examination Council.

Section 225.192(b) provides that an appraiser in an AMC's network or panel is deemed to remain a part of the AMC's appraiser panel until the AMC (1) sends a written notice to the appraiser removing the appraiser with an explanation or (2) receives a written notice from the appraiser asking to be removed or a notice of the death or incapacity of the appraiser. Section 225.193(b) requires each participating state to require non-federally regulated AMCs to register with the state appraiser certifying and licensing agency.

Section 225.195(c) requires a federally regulated AMC to report to the state or states in which it operates the information required to be submitted by the state pursuant to the ASC's policies regarding the determination of the AMC National Registry fee, including information relating to certain ownership limitations in the regulation.

Section 225.196 requires that each participating state submit to the ASC the information required to be submitted by the ASC regulations or guidance concerning AMCs that operate in the state.

Legal authorization and confidentiality: The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 authorizes the FR HY-5. Agencies must “jointly, by rule, establish minimum requirements to be applied by a State in the registration of [AMCs].” ^[1] The Agencies further must “jointly promulgate regulations for the reporting of the activities of [AMCs] to the [ASC] in determining the payment of the annual registry fee.” ^[2] Each participating state with an appraiser certifying and licensing agency must also transmit to the ASC “[1] a roster listing individuals who have received a State certification or license . . . [2] reports on the issuance and renewal of licenses and certifications, sanctions, disciplinary actions, and license and certification revocations, and license and certification suspensions on a timely basis to the national registry of the [ASC] . . . [3] including investigations initiated and disciplinary actions taken.” ^[3]

The HY-5 reporting and recordkeeping requirements are required to obtain a benefit for states because AMCs, unless they are owned and controlled by a federally regulated depository institution, are barred from providing appraisal management services for federally related transactions in a state that has not adopted the minimum AMC requirements.^[4] The FR HY-5 recordkeeping and disclosure requirements are mandatory for an AMC that is: (1) An AMC that is a subsidiary owned and controlled by a financial institution and regulated by a federal financial institution regulatory agency,^[5] or (2) is registered with a state that has a state appraiser certifying and licensing agency.

The Federal Reserve does not collect information subject to the HY-5 recordkeeping and reporting requirements. If information subject to the HY-5 requirements is obtained as part of an examination or supervision of a financial institution, it may be considered confidential under exemption 8 of the Freedom of Information Act (FOIA).^[6] Information subject to the HY-5 requirements may also be kept confidential under FOIA exemption 4 if it is confidential commercial or financial information that is both customarily and actually treated as private.^[7]

Consultation outside the agency: The Board, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Federal Housing Finance Agency collaborated in reassessing and confirming their burden estimates and methodologies for this submission and discussed potential improvements and evaluations for future submissions.

Board of Governors of the Federal Reserve System, November 29, 2021.

Michele Taylor Fennell,

Deputy Associate Secretary of the Board.

Footnotes

1. 12 U.S.C. 3353(a).

2. 12 U.S.C. 3353(e).

3. 12 U.S.C. 3338(a).

4. 12 U.S.C. 3353.

5. 12 U.S.C. 3353(c).

6. 5 U.S.C. 552(b)(8).

7. 5 U.S.C. 552(b)(4).