E8-11619. Project Design and Cost Standards for the Section 202 and Section 811 Programs

AGENCY:

Office of the Assistant Secretary for Housing—Federal Housing Commissioner, HUD.

ACTION:

Final rule.

SUMMARY:

This final rule revises HUD's regulations that govern the project design and cost standards for HUD's section 202 supportive housing for the Elderly and section 811 Persons with Disabilities programs. This rule allows project sponsors to use HUD funds for dishwashers in individual supportive housing units for the elderly and in independent living projects for persons with disabilities. The current regulation excludes dishwashers from the list of permitted project amenities. By providing access to dishwashers, a standard amenity in today's housing market, HUD endeavors to maintain the quality of life for elderly and disabled residents, and, further, the use of dishwashers will help promote healthy living conditions, and assist independent living. This rule will also clarify the applicability of the project design and cost standards to section 811 group homes. This final rule follows publication of an August 15, 2007, proposed rule on which HUD received one comment, which was fully supportive of the rule. HUD is adopting the August 15, 2007, proposed rule without change.

DATES:

Effective date: June 23, 2008.

FOR FURTHER INFORMATION CONTACT:

Yvonne Jefferson, Department of Housing and Urban Development, 451 Seventh Street, SW., Room 6154, Washington, DC 20410-8000, telephone number [phone] (this is not a toll-free number). Hearing- and speech-impaired persons may access this number through TTY by calling the toll-free Federal Information Relay Service at [phone].

SUPPLEMENTARY INFORMATION:

I. Background

On August 15, 2007, at 72 FR 45868, HUD published a proposed rule for public comment to amend the Department's regulations governing project design and cost standards for HUD's section 202 Supportive Housing for the Elderly and section 811 Persons with Disabilities programs. Section 202 of the Housing Act of 1959, as amended by section 801 of the Cranston-Gonzalez National Affordable Housing Act (12 U.S.C. 1701q), and section 811 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 8013), authorize HUD to establish programs to provide assistance to expand the supply of housing with supportive services for the elderly and persons with disabilities. HUD's regulations that establish the section 202 Supportive Housing for the Elderly program (section 202 program) and HUD's section 811 Supportive Housing for persons with disabilities program (section 811 program) are codified in 24 CFR Part 891.

Section 891.120 establishes the project design and cost standards for section 202 and section 811 projects. Projects must be modest in design and certain amenities are not eligible for HUD capital advance or project rental assistance contract (PRAC) funds. Dishwashers and washers and dryers are among the amenities for which HUD funding is restricted under the regulation; section 202 and section 811 project sponsors may include these amenities, but are not permitted to use HUD funds for their purchase or the continued operating costs associated with any ineligible amenity. HUD acknowledges that many items once considered excess amenities, including dishwashers, are now considered standard in today's housing market and that, in addition, their presence in housing units for the elderly and persons with disabilities would increase the quality of life, promote healthy living conditions, and assist independent living.

The current regulation does not address section 811 group homes specifically, therefore an ambiguity exists regarding what amenities are allowed in section 811 housing pursuant to § 891.120(c). HUD recognizes that the installation of washers and dryers in group homes intended for persons with disabilities would increase the supportive nature of that housing, and that HUD funding would likely encourage the availability of these appliances to benefit and enhance section 811 programs.

II. This Final Rule

This final rule follows the publication of an August 15, 2007, proposed rule. The public comment period on the proposed rule closed on October 15, 2007. HUD received one public comment on the proposed rule. This commenter supported the intent of the final rule, stating that because the people assisted by these programs are either elderly or have some type of disability, “* * * it is very favorable to have amenities such as a dishwasher in their homes because it will help them * * * further, it will assist independent living for these people.” HUD is issuing this final rule without change from the proposed rule.

III. Findings and Certifications

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 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 Regulatory Flexibility Act (5 U.S.C. 601 et seq.) generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. The regulatory change does not revise or establish new binding requirements on project sponsors or owners. Rather, this final rule updates HUD's regulations to authorize the use of section 202 and section 811 funds for an amenity now standard in today's housing market. the change will assist the elderly and persons with disabilities to live independently. Accordingly, the undersigned certifies that this rule will 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 (UMRA) (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 rule does not impose any federal mandate on state, local, or tribal government, or the private sector within the meaning of UMRA.

Federalism

Executive Order 13132 (entitled “Federalism”) prohibits an agency from publishing any rule that has federalism implications if the rule either imposes substantial direct compliance costs on state and local governments, and is not required by statute, or the rule preempts state law, unless the agency meets the consultation and funding requirements of section 6 of the Executive Order. This rule does not have federalism implications and does not impose substantial direct compliance costs on state and local governments nor preempt state law within the meaning of the Executive Order.

Catalog of Federal Domestic Assistance (CFDA)

The CFDA number for the Section 202 program is 14.157 and the CFDA number for the section 811 program is 14.181.

List of Subjects in 24 CFR Part 891

• Aged
• Grant programs-housing and community development
• Individuals with disabilities
• Loan programs-housing and community development
• Rent subsidies
• Reporting and recordkeeping requirements

For the reasons stated in the preamble, HUD amends 24 CFR Part 891 to read as follows:

PART 891—SUPPORTIVE HOUSING FOR THE ELDERLY AND PERSONS WITH DISABILITIES

1. The authority citation for part 891 continues to read as follows:

Authority: 12 U.S.C. 1701q; 42 U.S.C. 1437f, 3535(d), and 8013.

2. Revise § 891.120(c) to read as follows:

§ 891.120

Project design and cost standards.

* * * * *

(c) Restrictions on amenities. Projects must be modest in design. In individual units in supportive housing for the elderly and in independent living facilities for persons with disabilities, amenities not eligible for HUD funding include individual unit balconies and decks, atriums, bowling alleys, swimming pools, saunas, Jacuzzis, trash compactors, washers and dryers. However, HUD funding is eligible to pay for washers and dryers in group homes for persons with disabilities. Sponsors may include certain excess amenities, but must pay for them from sources other than the section 202 or 811 capital advance. They must also pay for the continuing operating costs associated with any excess amenities from sources other than the section 202 or 811 project rental assistance contract.

* * * * *

Dated: May 15, 2008.

Brian D. Montgomery,

Assistant Secretary for Housing—Federal Housing Commissioner.