[Federal Register Volume 64, Number 83 (Friday, April 30, 1999)]
[Proposed Rules]
[Pages 23484-23486]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-10464]
[[Page 23483]]
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Part V
Department of Housing and Urban Development
_______________________________________________________________________
24 CFR Part 968
Comprehensive Improvement Assistance Program; Proposed Rule
Federal Register / Vol. 64, No. 83 / Friday, April 30, 1999 /
Proposed Rules
[[Page 23484]]
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 968
[Docket No. FR-4462-P-01]
RIN 2577-AB97
Comprehensive Improvement Assistance Program
AGENCY: Office of the Assistant Secretary for Public and Indian
Housing, HUD.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would amend the regulations for the
Comprehensive Improvement Assistance Program (CIAP) to permit the non-
competitive distribution of CIAP funds to all eligible public housing
authorities (PHAs) based on two equally-weighted factors: a PHA's share
of the total number of units eligible for CIAP; and a PHA's share of
the total number of bedrooms in units eligible for CIAP (with studio
units counted as one-bedroom units). The purpose of this amendment is
to provide small PHAs the opportunity of a transition period to become
familiar with a non-competitive, capital funding process in
anticipation of formula funding in Federal Fiscal Year (FFY) 2000 under
new statutory authority.
DATES: Comments due date: June 1, 1999.
ADDRESSES: Interested persons are invited to submit written comments
regarding this proposed rule to the Rules Docket Clerk, Office of
General Counsel, Room 10276, Department of Housing and Urban
Development, 451 Seventh Street, SW, Washington, DC 20410. Comments
should refer to the above docket number and title. A copy of each
comment submitted will be available for public inspection and copying
between 7:30 a.m. and 5:30 p.m. weekdays at the above address.
Facsimile (FAX) comments will not be accepted.
FOR FURTHER INFORMATION CONTACT: William J. Flood, Director, Office of
Capital Improvements, Department of Housing and Urban Development, 451
Seventh Street, SW, Room 4134, Washington, D.C. 20410. Telephone (202)
708-1640. (This is not a toll free number.) Persons with hearing or
speech impediments may access this number via TTY by calling the
Federal Information Relay Service at 1-800-877-8339.
SUPPLEMENTARY INFORMATION:
I. Background
The Comprehensive Improvement Assistance Program (CIAP) is
authorized under section 14 of the United States Housing Act of 1937
(1937 Act). CIAP provides modernization funds to public housing
authorities (PHAs) that own or operate less than 250 units of public
housing, to enable them to improve the physical condition and upgrade
the management and operations of existing public housing developments
to assure their continued availability for low-income families. In FFY
1999, a total of $2.895 billion is available for Modernization Programs
(CIAP and Comprehensive Grant Program (CGP)), of which approximately
$364 million will be available to CIAP PHAs. Modernization funds are
allocated between CIAP and CGP PHAs based on the relative shares of
backlog needs (weighted at 50%) and accrual needs (weighted at 50%), as
determined by field inspections conducted for the HUD-funded Abt
Associates study of modernization needs. This allocation results in
CIAP PHAs receiving approximately 12.5% and CGP PHAs receiving
approximately 87.5% of the total funds available. In previous years, an
allocation of CIAP funds has been made for each Field Office based, in
part, on the relative shares of backlog and accrual needs for CIAP
PHAs. After the assignment of funds to Field Offices, CIAP funds were
then distributed to PHAs pursuant to a competitive process, under which
applications submitted to HUD were rated and ranked. Awards were then
made in rank order to the extent that funds were available. Under this
system of distribution, not every PHA that submitted an acceptable
application was funded.
In lieu of the former distribution method, HUD proposes to continue
to use the formula allocation for CIAP described in 24 CFR 968.103 (but
not to assign CIAP funds to Field Offices and then distribute the CIAP
funds to PHAs by a competitive method) and to amend the CIAP
regulations to permit the distribution of funds after formula
allocation to all eligible PHAs on a non-competitive basis. Section 519
of the Quality Housing and Work Responsibility Act of 1998 (Pub.L. 105-
276, 112 Stat. 2461, approved October 21, 1998) (QHWRA), authorizes a
new system of funding capital improvement needs for all PHAs, large and
small, on a formula basis beginning in FFY 2000. The final year of CIAP
funding will be FFY 1999. HUD will be working with housing industry and
resident groups, and representatives of small, medium and large PHAs to
develop, using the negotiated rulemaking process, an entirely new
formula for capital funds distribution for all PHAs. Rather than have
PHAs that own or operate less than 250 units continue to plan for and
obtain capital funding on a competitive basis that will soon no longer
be available, HUD wishes to provide these small PHAs the opportunity of
a transition period in which funding is made available under a process
that is closer to the formula-based capital program that will apply to
all PHAs beginning in FFY 2000.
This rule would amend 24 CFR 968.210 to remove the provisions that
require competitive funding and to add a provision that permits funding
distributions on the basis described below. To initiate the
distribution process, HUD will notify PHAs of their estimated dollar
amount and the time frame for submission of the CIAP application and
other pertinent information. Every eligible PHA (owning or operating
less than 250 units) that responds to the notice would then receive a
distribution based on two equally-weighted factors: (1) A PHA's share
of the total number of units eligible for CIAP; and (2) a PHA's share
of the total number of bedrooms in units eligible for CIAP (with studio
units counted as one-bedroom units). HUD currently estimates that for a
given PHA, each unit would receive between $1250 and $2250 per unit of
CIAP funding under this proposed system, and that for most PHAs, the
per unit funding will be between $1600 and $2000 per unit.
This proposed rule would also provide for the preferences under
section 14(h) of the 1937 Act. Under section 14(h), preferences are
given to small PHAs for projects having conditions which threaten the
health or safety of the tenants (emergency modernization preference) or
having a significant number of vacant, substandard units (vacancy
preference), and that also have demonstrated modernization capability.
Under the competitive system of distributing CIAP funds, emergency
modernization was funded as Group 1 during the competition or during
the course of the year from the emergency reserve under 24 CFR 968.104.
For the vacancy preference, HUD provided for extra points in the CIAP
NOFAs to PHAs that demonstrated the high priority needs and
modernization capability required for the vacancy preference.
The emergency modernization preference will be satisfied by
processing all emergency modernization under existing procedures in 24
CFR 968.104. In addition, HUD will set-aside
[[Page 23485]]
from the CIAP distribution approximately $6.1 million for the East
Texas housing authorities (those with less than 250 public housing
units) involved in the Young v. Cuomo civil rights case, to meet the
requirements of the settlement agreement, which is subject to judicial
oversight.
Because CIAP funds would not be distributed competitively under
this rule, the vacancy preference cannot be implemented by providing
extra points. This rule applies the vacancy preference by providing an
additional increment of funding to PHAs that have modernization
capability and demonstrate that at least 25% of their units are vacant,
substandard units (where vacancies are not due to insufficient demand).
A PHA has modernization capability if it has previously received CIAP
funding and meets the requirements of Modernization capability as
defined at Sec. 968.205. PHAs must apply for the vacancy preference
incremental assistance as part of the CIAP application (to be provided
by HUD under the notification required by 24 CFR 968.210(a)).
As an additional matter, this rule would make a technical
correction to Sec. 968.110(a), replacing a citation to ``section 503 of
the Rehabilitation Act of 1973'' with ``section 504 of the
Rehabilitation Act of 1973''.
II. Findings and Certifications
Justification for Shortened Comment Period
It is the general practice of the Department to provide a 60-day
public comment period on all proposed rules. However, in order to
provide a sufficient transition period for small PHAs to become
familiar with working under a new statutory system of funding capital
improvement needs on a formula basis rather than a competitive basis,
the Department is shortening its usual 60-day public comment period to
30 days.
Paperwork Reduction Act Statement
The information collection requirements of the Comprehensive
Improvement Assistance Program have been approved by the Office of
Management and Budget under OMB Approval No. 2577-0044. 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
In accordance with 40 CFR 1508.4 of the regulations of the Council
on Environmental Quality and 24 CFR 50.19(c)(2) of the HUD regulations,
this rule amends an existing document, the regulations at 24 CFR part
968, which as a whole would not fall within an exclusion, but the
amendment by itself would do so. Therefore, the actions proposed in
this document are determined not to have the potential of having a
significant impact on the quality of the human environment and further
review under the National Environmental Policy Act is not necessary. A
Finding of No Significant Impact (FONSI) is not required.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C.
1531-1538) establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. This proposed rule does not impose
any Federal mandates on any State, local, or tribal governments or the
private sector within the meaning of Unfunded Mandates Reform Act of
1995.
Executive Order 12866
The Office of Management and Budget (OMB) reviewed this proposed
rule under executive Order 12866, Regulatory Planning and Review. OMB
determined that this proposed rule is a ``significant regulatory
action,'' as defined in section 3(f) of the Order (although not
economically significant, as provided in section 3(f)(1) of the Order).
Any changes made to the proposed rule subsequent to its submission to
OMB are identified in the docket file, which is available for public
inspection in the office of the Department's Rules Docket Clerk, Room
10276, 451 Seventh Street, SW, Washington, DC 20410-0500.
Impact on Small Entities
The Secretary, in accordance with the Regulatory Flexibility Act (5
U.S.C. 605(b)) (the RFA), has reviewed and approved this proposed rule
and in so doing certifies that this rule will not have a significant
economic impact on a substantial number of small entities. The rule
would only modify the funding process for the final year of the CIAP to
provide small PHAs with a transition period to become familiar with a
non-competitive capital funding process. Small businesses are
specifically invited, however, to comment on whether this rule will
significantly affect them, and persons are invited to submit comments
according to the instructions in the DATES and COMMENTS sections in the
preamble of this proposed rule.
Executive Order 12612, Federalism
The General Counsel, as the Designated Official for HUD under
section 6(a) of Executive Order 12612, Federalism, has determined that
this rule will not have federalism implications concerning the division
of local, State, and Federal responsibilities. The rule would only
modify the funding process for the final year of the CIAP to provide
small PHAs with a transition period to become familiar with a non-
competitive capital funding process.
Catalog of Domestic Assistance Numbers
The Catalog of Domestic Assistance numbers for the Comprehensive
Improvement Assistance Program is 14.852.
List of Subjects in 24 CFR Part 968
Grant programs--housing and community development, Indians, Loan
programs--housing and community development, Public housing, Reporting
and recordkeeping requirements.
Accordingly, 24 CFR part 968 is amended, as follows:
PART 968--PUBLIC HOUSING MODERNIZATION
1. The authority citation for 24 CFR part 968 continues to read as
follows:
Authority: 42 U.S.C. 1437d, 1437l, and 3535(d).
2. In Sec. 963.110, paragraph (a) is revised to read as follows:
Sec. 968.110 Other program requirements.
* * * * *
(a) Nondiscrimination and equal opportunity. The PHA shall comply
with Title II of the Americans with Disabilities Act and 28 CFR part
35; section 504 of the Rehabilitation Act of 1973 and 41 CFR chapter
60-471; and the Architectural Barriers Act of 1968 (42 U.S.C. 4151-
4157) and 24 CFR part 40.
* * * * *
3. Section 968.210 is revised to read as follows:
Sec. 968.210 Procedures for obtaining approval of a modernization
program.
(a) HUD notification. After modernization funds for a particular
FFY become available, HUD will notify PHAs of the time frame for
submission of the CIAP application and other pertinent information.
(b) Distribution of funding. HUD will distribute the available
funding under this subpart to every eligible PHA that
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responds to the notice issued pursuant to paragraph (a) of this section
based on two equally-weighted factors: A PHA's share of the total
number of units eligible for CIAP; and a PHA's share of the total
number of bedrooms in units eligible for CIAP (with studio units
counted as one-bedroom units). HUD will also provide a vacancy
preference, consisting of an additional increment of funding, to PHAs
that have modernization capability and demonstrate that at least 25% of
their units are vacant, substandard units (where vacancies are not due
to insufficient demand). A PHA has modernization capability if it has
previously received CIAP funding and meets the requirements of
Modernization capability as defined at Sec. 968.205.
(c) ACC amendment. HUD and the PHA shall enter into an ACC
amendment in order for the PHA to draw down modernization funds. The
ACC amendment shall require low-income use of the housing for not less
than 20 years from the date of the ACC amendment (subject to sale of
homeownership units in accordance with the terms of the ACC). The PHA
Executive Director, where authorized by the Board of Commissioners and
permitted by State law, may sign the ACC amendment on behalf of the
PHA. HUD has the authority to condition an ACC amendment (e.g., to
require a PHA to hire a modernization coordinator or contract
administrator to administer its modernization program).
(d) Declaration of trust. As HUD may require, the PHA shall execute
and file for record a Declaration of Trust, as provided under the ACC,
to protect the rights and interests of HUD throughout the 20-year
period during which the PHA is obligated to operate its developments in
accordance with the ACC, the Act, and HUD regulations and requirements.
Dated: March 25, 1999.
Harold Lucas,
Assistant Secretary for Public and Indian Housing.
[FR Doc. 99-10464 Filed 4-29-99; 8:45 am]
BILLING CODE 4210-33-P
