[Federal Register Volume 77, Number 172 (Wednesday, September 5, 2012)]
[Notices]
[Pages 54602-54604]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-21840]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-5617-N-01]
RIN 2502-ZA13
Notice of Intent To Conduct Affirmatively Furthering Fair Housing
Demonstration in Baltimore, MD, Standard Metropolitan Statistical Area
(SMSA)
AGENCY: Office of the Assistant Secretary for Housing--Federal Housing
Commissioner, HUD.
ACTION: Notice of Intent To Conduct Affirmatively Furthering Fair
Housing Demonstration in Baltimore, Maryland, SMSA.
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SUMMARY: Through this proposed demonstration, HUD seeks to encourage
developers and owners of multifamily housing properties in
``communities of opportunity''--as defined by Thompson v. HUD--in the
Baltimore, Maryland, SMSA to make units in these properties affordable
to low-income persons. HUD seeks to determine if, as proposed in this
notice, providing developers with financial incentives, to create such
housing can help reduce segregation in the Baltimore SMSA.
DATES: Comments Due Date: November 5, 2012.
ADDRESSES: Interested persons are invited to submit comments regarding
HUD's Affirmatively Furthering Fair Housing demonstration, as announced
in this notice, to the Office of General Counsel, Rules Docket Clerk,
Department of Housing and Urban Development, 451 7th Street SW., Room
10276, Washington, DC 20410-0001. Communications should refer to the
above docket number and title and should contain the information
specified in the ``Request for Comments'' of this notice.
Submission of Hard Copy Comments. To ensure that the information is
fully considered by all of the reviewers, each commenter submitting
hard copy comments, by mail or hand delivery, should submit comments or
requests to the address above. Due to security measures at all federal
agencies, submission of comments or requests by mail often result in
delayed delivery. To ensure timely receipt of comments, HUD recommends
that any comments submitted by mail be submitted at least 2 weeks in
advance of the public comment deadline.
Electronic Submission of Comments. Interested persons may submit
comments electronically through the Federal eRulemaking Portal at
http://www.regulations.gov. HUD strongly encourages commenters to
submit comments electronically. Electronic submission of comments
allows the commenter maximum time to prepare and submit a comment,
ensures timely receipt by HUD, and enables HUD to make them immediately
available to the public. Comments submitted electronically through the
http://www.regulations.gov Web site can be viewed by interested members
of the public. Commenters should follow instructions provided on that
site to submit comments electronically.
No Facsimile Comments. Facsimile (FAX) comments are not acceptable.
Public Inspection of Comments. All comments submitted to HUD
regarding this notice will be available, without charge, for public
inspection and copying between 8 a.m. and 5 p.m. weekdays at the above
address. Due to security measures at the HUD Headquarters building, an
advance appointment to review the documents must be scheduled by
calling the Regulations Division at 202-708-3055 (this is not a toll-
free number). Copies of all documents submitted are available for
inspection and downloading at http://www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Mary Ann Henderson, Office of Housing,
U.S. Department of Housing and Urban Development, City Crescent
Building, 10 South Howard Street, Fifth Floor, Baltimore, Maryland
21201-2505, telephone number 410-209-6545 (this is not a toll-free
number). Persons with hearing or speech impairments may access this
number through TTY by calling the toll-free Federal Relay Service at
800-877-8339.
SUPPLEMENTARY INFORMATION
I. Background
Section 808(e) of the Fair Housing Act (42 U.S.C. 3608(e)) requires
HUD to administer its programs relating to housing and urban
development in a manner to affirmatively further fair housing (AFFH).
HUD carries out this obligation by requiring its program participants
to affirmatively further fair housing. AFFH means undertaking
affirmative efforts to overcome barriers to fair housing choice and
reduce segregation of persons on the basis of race, national origin,
and other protected classifications. HUD has funded a number of voucher
mobility programs, for example, which pair Housing Choice Vouchers with
mobility counseling to facilitate greater housing choice and overcome
the effects of historic patterns of segregation. One such regional
voucher mobility program
[[Page 54603]]
was established in the Baltimore SMSA in 1996.
Multifamily housing assisted by or with financing insured by HUD is
subject to the Fair Housing Act's AFFH requirement. Through this
proposed demonstration, HUD seeks to encourage investment in
multifamily housing and promote the availability of affordable housing
units in a manner that reduces racial segregation and increases
geographic and economic mobility in the Baltimore SMSA. For its
multifamily housing programs that insure financing for multifamily
housing development, HUD will offer incentives to make more affordable
housing available in mixed-income, integrated communities. In addition,
HUD will require that this new affordable housing is made available to
Housing Choice Voucher holders, expanding housing options for these
families.
II. Proposed Demonstration
HUD proposes to make available incentives for Federal Housing
Administration (FHA) insured financing to developers in order to
encourage the production and availability of more affordable housing
units in areas identified as communities of opportunity in the
Baltimore SMSA. Eligible areas are those in which the regional mobility
program, established under the Thompson v. HUD settlement, operates,
and which are identified as ``communities of opportunities'' in the
Thompson v. HUD settlement. HUD believes that the proposed incentives
will contribute to reducing racial segregation and increasing
opportunities for low-income families to live in areas identified as
communities of opportunity throughout the Baltimore SMSA.
This demonstration would be open to multifamily owners and
developers pursuing FHA mortgage insurance under the section 221(d)(4)
program or other FHA multifamily finance programs for properties to be
developed in eligible areas in the Baltimore SMSA. For such owners and
developers who agree to set aside a percentage of newly constructed or
rehabilitated two- or three-bedroom units for nonelderly families
holding Housing Choice Vouchers, either under a project-based voucher
contract or offered at rents less than or equal to the Fair Market Rent
(FMR) for the Baltimore SMSA, and in order to encourage the
construction of more affordable housing for these voucher holders, HUD
proposes to offer one or a combination of the following incentives:
Lowering the mortgage insurance premium (MIP);
Lowering the occupancy/vacancy rate when establishing the
project's anticipated budget; or
Establishing a procedure that results in greater or more
frequent surplus cash distributions for projects containing a specified
number of affordable units. The incentives offered would be subject to
any constraints of current and future program and budget authorities
and would be commensurate with the number of affordable units set aside
in the property, which in no case would be less than 10 percent of the
newly constructed or rehabilitated units in that property. HUD will
provide, in the notice soliciting applications, which incentives will
be available based on the percentage of affordable units that are set
aside.
Owners, developers, and lenders seeking to participate in the
demonstration described in this notice must: \1\
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\1\ Published elsewhere in today's Federal Register is HUD's 60-
day notice soliciting comment on the burden hours of the proposed
information collection requirements as set forth in this section.
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Certify that they meet all other requirements for FHA-
insured financing, comply with the terms of the demonstration, and
comply with HUD's nondiscrimination and equal opportunity requirements;
Submit an affirmative fair housing marketing plan
satisfactory to HUD for both the market-rate units and the units that
will be affordable to Housing Choice Voucher holders in Baltimore City
and throughout the Baltimore SMSA (a satisfactory affirmative fair
housing marketing plan must include marketing of affordable units to
Housing Choice Voucher holders in Baltimore City through the Thompson
regional mobility program);
Agree to not establish local residency preferences for
properties that receive incentives pursuant to this demonstration; and
Maintain statistics on the race and ethnicity of
applicants and occupants for both the affordable and market rate units
HUD has estimated that a total of 1,200 to 1,500 units in
multifamily housing properties may be made available per year in the
Baltimore SMSA. If 10 percent of those units were set aside as
affordable and available for vouchers holders under HUD's Housing
Choice Voucher program, the demonstration would yield approximately 120
to 150 affordable units per year. HUD will offer the above incentives
for not more than 300 affordable units per year, and will carefully
monitor the demonstration to determine whether it is succeeding in
increasing available affordable housing units in Thompson v. HUD
settlement communities of opportunity in the Baltimore SMSA. If, in any
year during this demonstration fewer than 300 affordable units are
created through the demonstration, the unused allocation of units would
roll over and be available in subsequent years, not to exceed 500 units
created through these incentives in any given year. To enable it to
evaluate the success of the demonstration, HUD proposes to operate the
program for a minimum of 7 years, as long as continued operation of the
demonstration is consistent with prudent fiscal management of the FHA
insurance fund. If the demonstration indicates that it is succeeding in
increasing the number of affordable housing units in areas identified
as communities of opportunity in the Baltimore SMSA, HUD will consider
if the demonstration should be expanded to other SMSAs.
III. Evaluating the Demonstration
One of the principal purposes of the demonstration is to determine
whether the incentives that HUD is proposing to provide developers and
owners of multifamily housing properties results in the availability of
more affordable housing to low-income persons in a manner that reduces
racial segregation and increases geographic and economic mobility. HUD
will, therefore, undertake an evaluation of the demonstration to
determine whether the demonstration could serve as a model that could
be successful nationwide or, alternatively, whether modifications to
the demonstration are needed.
IV. Solicitation of Public Comment
In accordance with section 470 of the Housing and Urban-Rural
Recovery Act of 1983 (42 U.S.C. 3542), HUD is seeking comment on the
demonstration for a period of 60 days, before commencing the
demonstration. After the close of the public comment period, and
following full consideration of comments submitted, HUD will publish
another notice that will advise of the commencement of the
demonstration, the specific incentives that HUD would offer multifamily
housing owners and developers for properties to be developed in
communities of opportunity in the Baltimore SMSA, as identified for the
Thompson regional mobility program, and other features or requirements
of the demonstration that HUD may prescribe.
During the comment period, HUD invites comment on all aspects of
the demonstration, but specifically solicits
[[Page 54604]]
comment on the incentives, and the criteria for receiving them, that
are proposed to be offered to multifamily owners and developers under
the demonstration, and seeks suggestions on specific parameters for
these incentives and additional incentives that may be helpful to HUD
in achieving the goals of the demonstration.
Dated: August 28, 2012.
Carol J. Galante,
Acting Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 2012-21840 Filed 9-4-12; 8:45 am]
BILLING CODE 4210-67-P