[Federal Register Volume 63, Number 248 (Monday, December 28, 1998)]
[Rules and Regulations]
[Pages 71372-71374]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-34314]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Parts 401 and 402
[Docket No. FR-4298-C-05]
RIN 2502-AH09
Multifamily Housing Mortgage and Housing Assistance Restructuring
Program (Mark-to-Market) and Renewal of Expiring Section 8 Project-
Based Assistance Contracts; Technical Corrections
AGENCY: Office of the Secretary, HUD.
ACTION: Interim rule; technical corrections.
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SUMMARY: On September 11, 1998, HUD published an interim rule
implementing the Mark-to-Market Program and the statutory provisions
for renewals of section 8 project-based assistance contracts expiring
in Fiscal Year 1999 or later. On October 15, 1998, HUD published a
first correction to the interim rule to correct the Internet address
given for submitting public comments. This second correction to the
interim rule addresses additional matters that were in error when the
interim rule was published and in need of correction. This document
also corrects one provision of the interim rule as well as preamble
language that needs correction because of a change in authorizing
legislation since issuance of the interim rule.
EFFECTIVE DATE: December 28, 1998.
FOR FURTHER INFORMATION CONTACT: Dan Sullivan, Department of Housing
and Urban Development, 451 7th St., Washington DC 20410. Telephone:
202-708-3555. (This is not a toll-free number.) For hearing- and
speech-impaired persons, this number may be accessed via TTY by calling
the Federal Information Relay Service at 1-800-877-8339.
SUPPLEMENTARY INFORMATION: On September 11, 1998 (63 FR 48926), HUD
published an interim rule implementing the Mark-to-Market Program and
the statutory provisions for renewals of section 8 project-based
assistance contracts expiring in Fiscal Year 1999 or later. The purpose
of this program is to preserve low-income rental housing affordability
while reducing the long-term costs of Federal rental assistance,
including project-based assistance, and minimizing the adverse effect
on the FHA insurance funds. The program is authorized by the
Multifamily Assisted Housing Reform and Affordability Act of 1997,
title V of Pub. L. 105-65 (approved October 27, 1997) (MAHRA).
Corrections Based on Original Legislation (MAHRA)
HUD is making the following corrections based on the MAHRA:
Several changes are made to the preamble and the rule to
eliminate conflicts between the preamble description of the rule and
the actual rule text (see corrections 2, 3, and 24).
Several erroneous or incomplete cross-references in the
preamble and the interim rule are corrected (see corrections 3, 7, 12,
17, 19, 20, 21, 22, 25, and 28).
Repetitive or erroneous extraneous language is removed in
various places in the preamble and the interim rule text to provide
simplicity and clarity (see corrections 5, 6, 8, 10, and 13).
One incorrect date in the rule text is corrected (see
correction 16).
Corrections Based on Recent Legislation (Pub. L. 105-276)
In addition to the corrections described above, other provisions of
the interim rule, although correct when published, now require
correction because of the subsequent enactment of the Departments of
Veterans Affairs and Housing and Urban Development, and Independent
Agencies Appropriations Act, 1999, Pub.L. 105-276 (approved October 21,
1998). Section 597(a)(2) of Pub.L. 105-276 amended MAHRA to change the
required methodology for determining restructured rents for certain
section 8 moderate rehabilitation projects under the Mark-to-Market
Program. This statutory change therefore requires a corresponding
change to Sec. 402.5(b)(3) of the interim rule and the applicable
preamble discussion. We have made this correction (see corrections 13
and 27).
In the preamble to the interim rule, HUD referred to one pending
provision of MAHRA which ultimately was not included in Pub.L. 105-276.
The pending provision would have amended section 515(h) of MAHRA to
limit the exclusion of projects with State or local primary financing
from the Mark-to-Market program. We have corrected the preamble by
removing the two sentences that contained reference to the pending
provision (see correction 1).
Other relevant provisions of the Pub.L. 105-276 will require
corrective rule changes in the future. These changes, however, are not
appropriate for a technical correction. Those provisions are as
follows.
1. Section 549(a) and (b) of Pub.L. 105-276 removed the requirement
of section 8(c)(8) of the United States Housing Act of 1937 (``the 1937
Act'') for owner notice to tenants of rent
[[Page 71373]]
increases, and amended the requirement of section 8(c)(9) of that Act
(now redesignated as section 8(c)(8) for owner notice to tenants and
HUD of section 8 contract termination. Both provisions are referenced
in Secs. 401.602 and 402.8 of the interim rule and discussed in the
preamble. Rule references to the notice required by former section
8(c)(8) should be considered superseded by section 549. Rule changes
will be needed to respond to the amendment of former section 8(c)(9)
(now section 8(c)(8)) but the subject is too complex to be addressed
fully in this correction. We will make appropriate changes in the final
rule. In this document, we remove some preamble discussion that is
incorrect under the current law (see corrections 11 and 15).
2. Section 549(c) of Pub.L. 105-276 added a new final sentence to
section 514(d) of MAHRA regarding an additional owner notice
requirement and restrictions on rent increases or evictions. This
matter is also complicated and will be addressed in the final rule
instead of this correction.
3. Section 599 of Pub.L. 105-276 amended section 202 of the Housing
and Community Amendments of 1978, concerning tenant participation in
certain multifamily housing projects, to apply to all projects with
project-based assistance or section 8 enhanced (``sticky'') vouchers
under the Mark-to-Market Program. Tenant participation under section
202 is the subject of 24 part 245. We have begun a separate proposed
rulemaking procedure to amend part 245 to reflect section 599 and to
make other changes.
Accordingly, FR Doc. 98-242840, Multifamily Housing Mortgage and
Housing Assistance Restructuring Program (Mark-to-Market) and Renewal
of Expiring Section 8 Project-Based Assistance Contracts (FR-4298-I-
01), published in the Federal Register on September 11, 1998 (63 FR
48926), is corrected as follows:
A. Corrections to the Preamble
1. On page 48929, first column, the second and third sentences of
the first full paragraph are removed.
2. On page 48931, second column, the second to the last sentence of
the first full paragraph, the following language is added immediately
after the reference to Sec. 401.453--``and the poor condition of the
project is not likely to be remedied in a cost-effective manner through
the Restructuring Plan.''
3. On page 48932, the last sentence in the first column, which
continues to the second column, is corrected to read ``An owner should
also follow this guidance when making a preliminary certification of
eligibility under Sec. 401.99 and a comparable market analysis under
Sec. 402.6(a)(1).''
4. On page 48933, first column, in the first sentence of the first
full paragraph, the words ``covered by a PRA'' are added immediately
after the word ``units''.
5. On page 48933, second column, the fourth full sentence is
removed, and the third full sentence is revised to read as follows:
``In addition, the PAE must consider the other matters listed in
section 515(c)(2)(B) of MAHRA to be assessed as part of the Plan, and
the applicable Consolidated Plan developed under 24 CFR part 91.''
6. On page 48933, third column, in the fourth sentence of the first
full paragraph, the number ``35'' is removed.
7. On page 48934, second column, in the second sentence of the
third full paragraph, the reference to ``517(b)(3)'' is corrected to
read ``517(b)(2)''. On page 48934, second column, in the first sentence
of the fourth full paragraph, the reference to ``401.700'' is corrected
to read ``401.310''.
8. On page 48935, first column, in the first sentence under the
heading ``Section 401.471 HUD Payment of Section 541(b) Claim,'' the
words ``or HUD-held'' are removed.
9. On page 48935, second column, in the first full sentence, the
word ``than'' is corrected to read ``that''.
10. On page 48937 in the preamble, first column, in the fourth
sentence under the heading ``Section 401.500 Required Notices to Third
Parties; Section 401.501 Who Is Entitled to Receive Notices Under
Sec. 401.500?'', the term ``by the owner'' is removed .
11. On page 48937 in the preamble, second column, the second
sentence in the second full paragraph which begins with the phrase ``In
particular * * *'' is removed.
12. On page 48938 in the preamble, second column, in the first
paragraph under the heading ``Section 401.602 Tenant Protections if an
Expiring Contract is Not Renewed,'' the regulatory references in the
last sentence of that paragraph are corrected as follows:
``Sec. 401.101 or 401.403'' is corrected to read ``Secs. 401.101,
401.403, or 401.405''.
13. On page 48939 in the preamble, third column, the parenthetical
statement that follows numbered paragraph (5) is corrected by removing
the phrase ``as explained in Part II of this Supplementary Information
under Sec. 401.100''.
14. On page 48940 in the preamble, first column, the language in
the first partial paragraph that follows the designation ``(3)'' is
corrected to read as follows: ``(3) in the case of a contract under the
section 8 moderate rehabilitation program (other than for a single room
occupancy dwelling), the lesser of existing rents adjusted by an OCAF,
fair market rents (less any amounts allowed for tenant-purchased
utilities), or comparable market rents.''
15. On page 48940 of the preamble, second column, the entire
discussion under the heading ``Section 402.8 Tenant Protections if an
Expiring Contract is not Renewed'' is corrected to read as follows:
``Section 402.8 discusses notices that an owner must give when an
expiring contract is not renewed, and the consequences of failure to
give notice, in a manner similar to Sec. 402.6. Both sections will be
revised in the final rule to reflect recent legislation that deleted
former section 8(c)(8) of the United States Housing Act of 1937 and
amended section 8(c)(9) of that Act (now redesignated as section
8(c)(8)).''
B. Corrections to the Rule
Sec. 401.99 [Corrected]
16. On page 48944, third column, in Sec. 401.99(b), introductory
text, ``January 1'' is corrected to read ``January 13''.
Sec. 401.100 [Corrected]
17. On page 48944, third column, in Sec. 401.100, the heading--
``General eligibility.''--for the introductory paragraph is removed.
Sec. 401.201 [Corrected]
18. On page 48945, first column, in Sec. 401.201, the term ``State
Housing Finance Agencies'' in Sec. 401.201(b) is corrected to read
``State housing finance agencies''.
Sec. 401.301 [Corrected]
19. On page 48945, first column, in Sec. 401.300, the reference to
``401.309'' is corrected to read ``401.314''.
Sec. 401.400 [Corrected]
20. On page 48947, first column, in Sec. 401.400(b), ``Section
514'' is corrected to read ``section 514(e)''.
Sec. 401.403 [Corrected]
21. On page 48947, second column, in Sec. 401.403(b)(2), the words
``and (b)'' are removed.
Sec. 401.411 [Corrected]
22. On page 48948, second column, in Sec. 401.411(a), the reference
to ``514(g)'' is corrected to read ``514(g)(2)''.
Sec. 401.461 [Corrected]
23. On page 48950, second column, in Sec. 401.461(b)(4), the phrase
``or the owner'' is corrected to read ``or if the owner''.
[[Page 71374]]
Sec. 401.472 [Corrected]
24. On page 48950, third column, in Sec. 401.472(a)(1), the phrase
``residual receipts account, surplus cash account, residual receipts
account'' is corrected to read ``residual receipts account, surplus
cash account, replacement reserve account''.
Sec. 401.552 [Corrected]
25. On page 48952, second column, in Sec. 401.552, the reference to
``401.461(b)(2)'' is corrected to read ``401.461(b)(3)(ii)(A)''.
Sec. 402.1 [Corrected]
26. On page 48954, first column, in Sec. 402.1, the word
``eligible'' is added immediately before the word ``projects'' in the
second sentence of that section.
Sec. 402.5 [Corrected]
27. On page 48954, second column, Sec. 402.5(c)(3) is corrected to
read: ``In the case of a contract under the section 8 moderate
rehabilitation program (other than single room occupancy dwellings
under section 441 of the Stewart B. McKinney Homeless Assistance Act),
the lesser of existing rents adjusted by an OCAF, fair market rents
(less any amounts allowed for tenant-purchased utilities), or
comparable market rents.''
Sec. 402.6 [Corrected]
28. On page 48954, third column, in Sec. 402.6(b), the reference to
``Sec. 401.4 or Sec. 401.5(b)(2)'' is corrected to read ``Sec. 402.4 or
Sec. 402.5(b)(2)''.
Dated: December 21, 1998.
Camille E. Acevedo,
Assistant General Counsel for Regulations.
[FR Doc. 98-34314 Filed 12-24-98; 8:45 am]
BILLING CODE 4210-32-P
