[Federal Register Volume 63, Number 150 (Wednesday, August 5, 1998)]
[Rules and Regulations]
[Pages 41715-41716]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-20393]
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DEPARTMENT OF AGRICULTURE
Rural Housing Service
Rural Business-Cooperative Service
Rural Utilities Service
Farm Service Agency
7 CFR Part 1955
Property Management
AGENCIES: Rural Housing Service, Rural Business-Cooperative Service,
Rural Utilities Service, and Farm Service Agency, USDA.
ACTION: Final rule.
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SUMMARY: The Agencies are revising their Property Management
regulations to clarify changes in definitions that only affect Real
Estate Owned (REO) by the Agency, and not a customer's account. This
action is being taken to update and correct the definitions of the
terms ``nonrecoverable'' and ``recoverable.'' The intended effect is to
improve the Agencies' recordkeeping systems.
EFFECTIVE DATE: August 5, 1998.
FOR FURTHER INFORMATION CONTACT: Carl Muhlbauer, Program Support Staff,
Rural Housing Service, U.S. Department of Agriculture, Stop 0761, South
Agriculture Building, 1400 Independence Avenue SW., Washington, DC
20250-0761; telephone (202) 690-2141.
SUPPLEMENTARY INFORMATION:
Classification and Summary of Changes
This action is not subject to the provisions of Executive Order
12866 since it only involves a change in the way the Agencies perform
their accounting. In pre-Credit Reform practice, taxes were paid out of
the revolving funds, making it impossible to identify and credit later
tax payment reimbursements to the properties affected. This change will
allow the Agencies to more precisely charge and credit tax payments
related to Real Estate Owned (REO) property by associating them with
the specific properties on which taxes are invoiced. Property
management regulation definitions of ``nonrecoverable'' and
``recoverable'' and policy and procedure for related Agency
expenditures are being revised to conform to certain definitions and
cost accounting developed under the Credit Reform Act as implemented
through the Office of Management and Budget Circular A-34. Definitions
developed under OMB guidance, intended to distinguish between
administrative expenses directly related to program operations
(nonrecoverable), and expenses directly related to and chargeable to a
borrower or REO account (recoverable), including the costs of
foreclosing, managing, and selling collateral, have been in use under
unpublished internal Agency policy (RD Instruction 2024-A). Property
Management regulations were never revised to reflect the change in
definitions. These revisions do not affect the legal or actual
recoverability of a charge from a borrower. The replacement of the term
``nonrecoverable costs'' with ``recoverable costs'' in Secs. 1955.67,
1955.68, and 1955.69 affects only REO property, not a borrower account.
Since the public is not affected by this rulemaking change, publication
for notice and comment is not necessary.
Programs Affected
These programs or activities are listed in the Catalog of Federal
Domestic Assistance and are subject to the provisions of Executive
Order 12372 which require intergovernmental consultation with State and
local officials under the following numbers:
10.405--Farm Labor Housing Loans and Grants
10.407--Farm Ownership Loans
10.411--Rural Housing Site Loans
10.415--Rural Rental Housing Loans
10.416--Soil and Water Loans
10.421--Indian Tribes and Tribal Corporation Loans
10.760--Water and Waste Disposal Systems for Rural Communities
10.764--Resource Conservation and Development Loans
10.765--Watershed Protection and Flood Prevention Loans
10.766--Community Facilities Loans
10.767--Intermediary Relending Program
10.768--Business and Industrial Loans
10.770--Water and Waste Disposal Loans and Grants
The following programs or activities are excluded from the scope of
Executive Order 12372 which requires intergovernmental consultation
with State and local officials, under the following numbers:
10.404--Emergency Loans
10.406--Farm Operating Loans
10.443--Outreach and Assistance Grants for Socially Disadvantaged
Farmers and Ranchers
10.850--Rural Electrification Loans and Loan Guarantees
Paperwork Reduction Act
The information collection requirements contained in this
regulation have been approved by the
[[Page 41716]]
Office of Management and Budget (OMB) under the provisions of 44 U.S.C.
chapter 35 and have been assigned OMB control numbers 0575-0109 and
0575-0110 in accordance with the Paperwork Reduction Act of 1995 (44
U.S.C. 3507). This rule does not revise or impose any new information
collection or recordkeeping requirements.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub.
L. 104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. Under section 202 of the UMRA, the
Agencies generally must prepare a written statement, including a cost
benefit analysis, for proposed and final rules with ``Federal
mandates'' that may result in expenditures to State, local, or tribal
governments, in the aggregate, or to the private sector, of $100
million or more in any one year. When such a statement is needed for a
rule, section 205 of the UMRA generally requires the Agencies to
identify and consider a reasonable number of regulatory alternatives
and adopt the least costly, more cost-effective or least burdensome
alternative that achieves the objectives of the rule.
This rule contains no Federal mandates (under regulatory provisions
of title II of the UMRA) for State, local, and tribal governments or
the private sector. Thus, this rule is not subject to the requirements
of sections 202 and 205 of the UMRA.
Regulatory Flexibility Act
The undersigned certify that this rule will not have a significant
impact on a substantial number of small entities as defined under the
Regulatory Flexibility Act. Pub. L. 96-534, as amended (5 U.S.C. 601).
No actions are being taken under this rule that affect small entities.
These changes only affect Agency recordkeeping. Therefore, a Regulatory
Flexibility Analysis has not been prepared.
Environmental Impact Statement
It is the determination of the issuing Agencies that this action is
not a major Federal action significantly affecting the environment and,
in accordance with the National Environmental Policy Act of 1969, Pub.
L. 91-190, an Environmental Impact Statement is not required.
Executive Order 12988
This rule has been reviewed in accordance with Executive Order
12988, Civil Justice Reform. In accordance with this rule: (1) All
State and local laws and regulations that are in conflict with this
rule will be preempted; (2) no retroactive effect will be given to this
rule; and (3) administrative proceedings in accordance with 7 CFR parts
11, and 1900, subpart B or 780, as applicable, must be exhausted before
bringing suit in court challenging action taken under this rule unless
those regulations specifically allow bringing suit at an earlier time.
List of Subjects in 7 CFR Part 1955
Foreclosure, Government acquired property, Government property
management Chapter XVIII, title 7, Code of Federal Regulations is
amended as follows:
PART 1955--PROPERTY MANAGEMENT
1. The authority citation for part 1955 continues to read as
follows:
Authority: 5 U.S.C. 301; 7 U.S.C. 1989; 42 U.S.C. 1480.
Subpart A--Liquidation of Loans Secured by Real Estate and
Acquisition of Real and Chattel Property
2. Section 1955.3 is amended by revising the definitions of
``Nonrecoverable costs'' and ``Recoverable costs'' to read as follows:
Sec. 1955.3 Definitions.
* * * * *
Nonrecoverable cost is a contractual or noncontractual program loan
cost expense not chargeable to a borrower, property account, or part of
the loan subsidy.
* * * * *
Recoverable cost is a contractual or noncontractual program loan
cost expense chargeable to a borrower, property account, or part of the
loan subsidy.
* * * * *
Subpart B--Management of Property
3. Section 1955.53 is amended by revising the definitions of
``Nonrecoverable costs'' and ``Recoverable costs'' to read as follows:
Sec. 1955.53 Definitions.
* * * * *
Nonrecoverable cost is a contractual or noncontractual program loan
cost expense not chargeable to a borrower, property account, or part of
the loan subsidy.
* * * * *
Recoverable cost is a contractual or noncontractual program loan
expense chargeable to a borrower, property account, or part of the loan
subsidy.
* * * * *
Secs. 1955.67--1955.71 [Removed and Reserved]
4. Sections 1955. 67 through 1955.71 are removed and reserved.
Dated: May 19, 1998.
Jan E. Shadburn,
Administrator, Rural Housing Service.
Dated: May 21, 1998.
William P. Hagy,
Acting Administrator, Rural Business-Cooperative Service.
Dated: May 28, 1998.
Wally B. Beyer,
Administrator, Rural Utilities Service.
Dated: June 1, 1998.
Keith Kelly,
Administrator, Farm Service Agency.
[FR Doc. 98-20393 Filed 8-4-98; 8:45 am]
BILLING CODE 3410-XY-P
