[Federal Register Volume 77, Number 234 (Wednesday, December 5, 2012)]
[Rules and Regulations]
[Pages 72219-72223]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-29361]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 203
[Docket No. FR-5679-N-01]
Federal Housing Administration: Prohibited Sources of Minimum
Cash Investment Under the National Housing Act--Interpretive Rule
AGENCY: Office of the General Counsel, HUD.
ACTION: Interpretive rule.
-----------------------------------------------------------------------
SUMMARY: HUD is issuing this interpretive rule to clarify the scope of
the provision in the National Housing Act that prohibits certain
sources of a homebuyer's funds for the required minimum cash investment
for single family mortgages to be insured by the Federal Housing
Administration (FHA). Uncertainty has arisen as to the effect of this
provision on State and local governments and their agencies' and
instrumentalities' homeownership programs that provide funds for the
minimum cash investment. This rule provides HUD's interpretation that
this statutory provision does not remove the availability of FHA
insurance for use in conjunction with State and local government
programs that provide funds toward the required minimum cash
investment. Although interpretive rules are exempt from public comment
under the Administrative Procedure Act, HUD nevertheless invites public
comment on the interpretation provided in this rule.
DATES: Effective Date: November 29, 2012. Comment Due Date: January 4,
2013.
ADDRESSES: Interested persons are invited to submit comments regarding
this rule to the Regulations Division, Office of General Counsel,
Department of Housing and Urban Development, 451 7th Street SW., Room
10276, Washington, DC 20410-0500. Communications must refer to the
above docket number and title. There are two methods for submitting
public comments. All submissions must refer to the above docket number
and title.
1. Submission of Comments by Mail. Comments may be submitted by
mail to the Regulations Division, Office of General Counsel, Department
of Housing and Urban Development, 451 7th Street SW., Room 10276,
Washington, DC 20410-0500.
2. Electronic Submission of Comments. Interested persons may submit
comments electronically through the Federal eRulemaking Portal at
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
www.regulations.gov Web site can be viewed by other commenters and
interested members of the public. Commenters should follow the
instructions provided on that site to submit comments electronically.
Note: To receive consideration as public comments, comments
must be submitted through one of the two methods specified above.
Again, all submissions must refer to the docket number and title of
the rule.
No Facsimile Comments. Facsimile (FAX) comments are not acceptable.
Public Inspection of Public Comments. All properly submitted
comments and communications submitted to HUD will be available 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 appointment to review the public comments must be
scheduled in advance by calling the Regulations Division at 202-708-
3055 (this is not a toll-free number). Individuals with speech or
hearing impairments may access this number via TTY by calling the
Federal Relay Service at 800-877-8339. Copies of all comments submitted
are available for inspection and downloading at www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Millicent Potts, Associate General
Counsel for Insured Housing, Office of General Counsel, U.S. Department
of Housing and Urban Development Room 9226, 202-708-2212. Hearing or
speech impaired individuals may access these numbers via TTY by calling
the toll free Federal Relay Service at 800-877-8339.
SUPPLEMENTARY INFORMATION:
I. Background
A. The National Housing Act Prohibition on Certain Sources of Cash
Investment
To qualify a mortgage for FHA mortgage insurance, section
203(b)(9)(A) of the National Housing Act (12 U.S.C. 1709(b)(9))
requires the homebuyer to
[[Page 72220]]
pay ``in cash or equivalent on account of the property an amount equal
to not less than 3.5 percent of the appraised value of the property.''
Some homebuyers obtain this minimum amount from sources other than
their own earnings or savings; for example, a relative may give or loan
them this money or some part of it. However, section 203(b)(9)(C) of
the National Housing Act provides that no part of this required minimum
investment may consist of funds provided by the seller of the property
or any other person or entity who benefits financially from the sale of
the property, or any person who is reimbursed by any such person or
entity.
B. Federally Funded Homeownership Programs
Governments--Federal, State, and local--and their agencies and
instrumentalities have provided assistance toward the minimum cash
investment as part of homeownership programs from various public funds,
including appropriated funds, operating tax revenues, taxable and tax-
exempt general obligation bonds, and surplus revenues (for example,
excess reserves). Federal homeownership assistance programs that have a
cash investment component include HUD's Neighborhood Stabilization
Program, Community Development Block Grant (CDBG) program, and HOME
Investment Partnerships program, as well as the Department of Veterans
Affairs Home Loan Guaranty Service and U.S. Department of Agriculture's
Rural Development Housing and Community Facilities program. These
Federal homeownership assistance programs have specified public
purposes, such as revitalizing communities affected by foreclosures and
vacancy, increasing the homeownership rate in particular geographies,
making homeownership affordable to underserved populations and in high-
cost markets.
For these Federal assistance programs, Congress has authorized
funds to be distributed from the Treasury, often through State and
local governments or their instrumentalities, for purposes of
supporting homeownership programs. At the same time, section
203(b)(9)(C) of the National Housing Act raises the question whether
the distribution of these same Federal funds would cause the mortgages
originated on the basis of support from such funds not to qualify for
FHA insurance. Reading the prohibition in section 203(b)(9)(C) to
include other Federal agencies, State and local governments, or their
instrumentalities disbursing government funds in accordance with the
requirements of government assistance programs would place these
governments and instrumentalities in an untenable position of having
governmental authority to provide assistance toward the minimum cash
investment on the one hand, but being unable to use FHA-insured
mortgage financing on the other. To do so would also frustrate the
statutory purpose of these programs and of the FHA to encourage and
support homeownership.\1\
---------------------------------------------------------------------------
\1\ In providing an overview of the Housing and Economic
Recovery Act if 2008 (HERA), the Congressional Research Service in
an August 19, 2008 report for Congress on HERA [RL34623] notes that
HERA authorizes $4 billion for state and local governements to
purchase and rehabilitate abandoned and foreclosed houisng and that
this housing would be sold or rented to low- and moderate-income
individuals and families. See http://assets.opencrs.com/rpts/RL34623_20080819.pdf.
---------------------------------------------------------------------------
C. Other Government Funded Homeownership Assistance Programs
Another key source of homeownership assistance programs, such as
assistance with closing costs, or rehabilitation, is provided by State
and local governments, primarily through housing finance agencies
(HFAs). According to the National Council of State Housing Finance
Agencies, HFAs are generally State-chartered authorities established by
State governments to help meet the affordable housing needs of State
residents.\2\ Although HFAs vary widely in characteristics such as
their relationship to State government, most are independent entities
that operate under the direction of a board of directors appointed by
their respective State governors. They administer a wide range of
affordable housing and community development programs.\3\ Using housing
bonds, low-income housing tax credits, HOME program funds, and other
Federal and State resources, HFAs have crafted hundreds of housing
programs, including homeownership, rental, and all types of special-
needs housing. HFAs have provided affordable mortgages to 2.6 million
families to buy their first homes through mortgage revenue bond
programs.\4\
---------------------------------------------------------------------------
\2\ See http://answers.usa.gov/system/selfservice.controller?CONFIGURATION=1000&PARTITION_ID=1&CMD=VIEW_ARTICLE&USERTYPE=1&LANGUAGE=en&COUNTRY=US&ARTICLE_ID=10182.
\3\ See http://www.ncsha.org/about-hfas/hfa-programs.
\4\ See http://www.ncsha.org/about-hfas.
---------------------------------------------------------------------------
A recent study of HFAs found that 100 percent of the 51 HFAs
surveyed said that part of their mission is ``to assist low- and
moderate-income residents to purchase homes and be successful
homeowners.'' \5\ A majority of those programs--in 2011, 88 percent (45
of 51) of State HFAs--include minimum cash investment as a part of
advancing their mission.\6\ Federally backed mortgage insurance is also
a critical part of the HFAs' strategy. Of HFA loan production in 2011,
86 percent involved FHA, Veterans Administration (VA), or Rural Housing
Service loan or loan insurance programs.
---------------------------------------------------------------------------
\5\ See http://www.chfainfo.com/documents/HFA_HEC_Report_March2012.pdf at 1.
\6\ Id. at 1.
---------------------------------------------------------------------------
Many HFAs administer other State and Federal housing assistance
programs such as homeless assistance, CDBG, and State housing trust
funds. Local housing finance agencies operate similarly but at the
county, city, or other municipal-entity level. In many cases, a local
agency may be the local government itself. HFAs provide various
services to assist citizens within their jurisdictions in attaining
affordable housing options. These services include providing access to
affordable mortgage loans for purchasing a home, counseling, money and
other resources for closing costs, and assistance for any required
investment in the mortgaged property. Such funds come from numerous
sources. Program beneficiaries are usually low- and moderate-income
individuals and families who have gone through homeownership counseling
through which they receive training on money management, use of credit,
and home maintenance.
D. FHA and Minimum Cash Investment Requirements
Since its enactment, the National Housing Act (NHA) has required
the mortgagor to have a minimum investment in the property being
purchased. For many years, the required minimum investment was 3
percent of the cost of acquisition, and is currently 3.5 percent of the
home's appraised value. Prior to 2008, the statute and regulations
regarding the required investment were silent, with minor exceptions,
as to permissible sources of the mortgagor's required investment.
However, FHA's single family mortgage credit handbook, Handbook
4155.1,\7\ provided administrative guidance to approved mortgagees as
to permissible sources of the funds that a homebuyer could use for the
required minimum investment. HUD's policy under the handbook provisions
was to permit the minimum cash investment to be financed by sources
including a family
[[Page 72221]]
member, the borrower's employer or labor union, a governmental entity,
a charitable organization, or a close friend with a clearly defined and
documented interest in the borrower. HUD's policies have always
expressly prohibited the seller from financing or providing a gift of
the required investment.
---------------------------------------------------------------------------
\7\ See http://www.hud.gov/offices/adm/hudclips/handbooks/hsgh/4155.1/41551HSGH.pdf.
---------------------------------------------------------------------------
In the 1990s, several nonprofit entities developed an approach to
funding homebuyers' cash investments that circumvented the handbook
prohibition. These entities obtained charitable status from the
Internal Revenue Service, and then encouraged home sellers to use their
services and provided homebuyers with all or part of the required cash
investment amount. After the funds were provided by the nonprofit
entity to the homebuyer, the seller made a donation to the nonprofit
entity of the amount of the assistance plus a fee. The donated funds
were directed to subsequent homebuyers for the cash investment on their
homes. The nonprofit does not conduct broad-based fundraising but
instead relies on sellers and other businesses in real estate for
financial support. In effect, sellers and other donors were indirectly
funding the homebuyer's required minimum investment by reimbursing the
nonprofit entity for each transaction.\8\
---------------------------------------------------------------------------
\8\ See IRS Ruling 2006-27, available at http://www.irs.gov/pub/irs-drop/rr-06-27.pdf.
---------------------------------------------------------------------------
As the prevalence of channeling funds from sellers through
nonprofit entities increased, FHA became concerned that this practice
as applied to homebuyers with FHA-insured mortgages could result in FHA
insuring riskier loans. In response, FHA published a proposed rule in
1999 to prohibit this source of the minimum cash investment.\9\ Under
the proposed rule, a gift of the buyer's required minimum cash
investment would disqualify the loan from FHA insurance if the entity
providing the gift received funds directly or indirectly from the
seller of the property. However, the proposed rule expressly included
funds provided by a ``State or local government agency or
instrumentality'' in the category of permissible sources of funds that
the homebuyer can apply toward the minimum investment requirement.\10\
HUD withdrew the rule in January 2001 in light of widespread opposition
to the rule as proposed.\11\
---------------------------------------------------------------------------
\9\ See Sources of Homeowner Downpayment, 64 FR 49956 (proposed
Sept. 14, 1999).
\10\ See id. at 49958.
\11\ See Withdrawal of Proposed Rule on Sources of Homeowner
Downpayment Pursuant to Section 203 of the National Housing Act, 66
FR 2851 (January 12, 2001).
---------------------------------------------------------------------------
The direct and indirect financing of homebuyers' minimum cash
investment by sellers continued to be a source of concern following the
withdrawal of the proposed rule. In 2005, the Government Accountability
Office (GAO) published a report on the risks raised by the
reimbursement of nonprofit entities by sellers.\12\ The GAO findings
noted that sales prices were increased commensurately to cover the cost
incurred by the seller, and thus resulted in homeowners having less
actual equity in the newly acquired home.\13\ The GAO report also found
that the default and claim rate for homes purchased with charitable
gifts where the nonprofit entity was reimbursed by the seller was much
higher than in those cases where the homebuyer provided his or her own
money for the required investment.\14\
---------------------------------------------------------------------------
\12\ See United States Government Accountability Office,
``Mortgage Finance--Additional Action Needed to Manage Risk of FHA-
Insured Loans with Down Payment Assistance,'' (Nov. 2005) available
at http://www.gao.gov/new.items/d0624.pdf.
\13\ See id. at 25.
\14\ See id. at 3-4.
---------------------------------------------------------------------------
Moreover, the IRS found that organizations claiming to be charities
were being used to funnel money from sellers to buyers through self-
serving, circular-financing arrangements, and that in a typical scheme,
there is a direct correlation between the amount of the funds provided
to the buyer and the payment received from the seller.\15\ On May 4,
2006, the IRS issued Revenue Ruling 2006-27, which determined that
organizations that indirectly provide cash investments funded by
sellers to homebuyers do not qualify as tax-exempt charities.\16\ In
the press announcement accompanying the ruling, the IRS stated that the
ruling makes clear that organizations operating seller-funded programs
are not charities because they do not meet the requirements of section
501(c)(3) of the Internal Revenue Code.\17\ The IRS also found that the
seller pays the organization only if the sale closes, and the
organization usually charges an additional fee for its services.\18\
---------------------------------------------------------------------------
\15\ See http://www.irs.gov/Charities-&-Non-Profits/Seller-Funded-Down-Payment-Assistance-Programs-Are-Not-Tax-Exempt.
\16\ See http://www.irs.gov/pub/irs-drop/rr-06-27.pdf.
\17\ See http://www.irs.gov/uac/IRS-Targets-Down-Payment-Assistance-Scams;-Seller-Funded-Programs-Do-Not-Qualify-As-Tax-
Exempt.
\18\ Id.
---------------------------------------------------------------------------
On May 11, 2007, HUD again published a proposed rule that
prohibited funds provided by the seller as a source for the minimum
cash investment.\19\ This provision, entitled ``Restrictions on Seller
Funding,'' proposed to prohibit cash investment amounts that consists,
in whole or in part, of funds provided by any of the following parties
before, during or after closing of the property sale: ``(1) The seller,
or any other person or entity that financially benefits from the
transaction; or (2) any third party or entity * * * that is reimbursed
directly or indirectly by any of the parties listed in clause (1).''
\20\ Once again, the May 2007 proposed rule expressly exempted funds
from ``a federal, state, or local government agency or
instrumentality'' from the category of prohibited sources for funds
toward the required minimum investment.\21\ HUD published its final
rule on October 1, 2007.\22\ On the effective date of the rule, a
lawsuit challenging the rule was filed against HUD in the U.S. district
court for the Eastern District of California, and in February 2008 the
court set aside the final rule.\23\
---------------------------------------------------------------------------
\19\ See Standards for Mortgagor's Investment in Mortgaged
Property, 72 FR. 27048 (proposed May 11, 2007).
\20\ See id. at 27049.
\21\ See id. at 27051.
\22\ See Standards for Mortgagor's Investment in Mortgaged
Property, 72 FR 56002 (final Oct. 1, 2007).
\23\ See Nehemiah Corp. of America v. Jackson, 546 F. Supp. 2d
830, 848 (E.D. Cal. 2008).
---------------------------------------------------------------------------
The 2005 GAO report, the 2006 IRS Ruling, and the judicial
invalidation of HUD's final rule eventually led to congressional action
on the issue in 2008. Section 2113 of the Housing and Economic Recovery
Act of 2008 (HERA), signed into law on July 30, 2008, amended the NHA
with language that is identical in relevant part to the language in
HUD's 2007 final rule. Section 2113 of HERA amended section 203(b)(9)
of the NHA to provide that mortgages eligible for FHA insurance must
``[b]e executed by a mortgagor who shall have paid in cash or its
equivalent, on account of the property an amount equal to not less than
3.5 percent of the appraised value of the property or such larger
amount as the Secretary may determine.'' Section 203(b)(9) was also
amended to include a new subparagraph (9)(C), which specifies
prohibited sources for a mortgagor's minimum investment. Section
203(b)(9)(C) of the NHA states:
PROHIBITED SOURCES.--In no case shall the funds required by
subparagraph (A) consist, in whole or in part, of funds provided by
any of the following parties before, during, or after closing of the
property sale:
(i) The seller or any other person or entity that financially
benefits from the transaction.
(ii) Any third party or entity that is reimbursed, directly or
indirectly, by any of the parties described in clause (i).
Since HERA's enactment, FHA has not replaced the regulation that
was
[[Page 72222]]
vacated by the district court in February 2008. However, Mortgagee
Letter 2008-23 provides notification of the statutory revisions to the
cash investment requirements imposed by HERA.\24\ Instead of 3 percent
of the cost of acquisition, the required investment was changed by HERA
to 3.5 percent of the appraised value of the property. Aside from the
statement that closing costs (i.e., the present allowed seller
incentive of 6 percent) could not be used to meet the 3.5 percent
appraised value minimum investment requirement, the Mortgagee Letter is
silent regarding the source of the required cash investment by the
mortgagor.
---------------------------------------------------------------------------
\24\ See Mortgagee Letter 2008-23, available at http://portal.hud.gov/hudportal/documents/huddoc?id=DOC_19737.pdf.
---------------------------------------------------------------------------
II. This Interpretive Issue
A. Conjunction of Government Housing Assistance Programs and FHA-
Insured Mortgages
It is HUD's interpretation that section 203(b)(9)(C) of the NHA
does not prohibit FHA from insuring mortgages originated as part of the
homeownership programs of Federal, State, or local governments or their
agencies or instrumentalities when such agencies or instrumentalities
also directly provide funds toward the required minimum cash
investment.\25\ The addition of a statutory provision on prohibited
sources of cash investment funds, as part of the amendments to section
203(b)(9) of the NHA enacted in HERA, was intended to preclude the
abuse of the program where a seller (or other interested or related
party) funded the homebuyer's cash investment after the closing by
reimbursing third-party entities and added the cost of this
reimbursement to the sales price of the home, thus inflating the price
of the home beyond its market value. It is HUD's interpretation that
the amended section 203(b)(9) does not exclude as a permissible source
of cash investment, funds provided directly by Federal, State, or local
governments, or their agencies or instrumentalities as part of their
respective homeownership programs.
---------------------------------------------------------------------------
\25\ In Mortgagee Letter 94-2, FHA defined a government agency
or instrumentality for purposes of section 528 of the NHA. See
http://portal.hud.gov/hudportal/documents/huddoc?id=DOC_16755.txt.
This definition applies here. That definition provides that the
entity must have been established by a governmental body or with
governmental approval or under special law to serve a particular
public purpose or designated as an instrumentality by law (statute
or court opinion) and the majority of governing board and/or
principal officers named or approved by governmental body/officials,
or the government body approves all major decisions and/or
expenditures, or the government body provides funds through direct
appropriations/grants/loans, with related controls applicable to all
activities of entity.
---------------------------------------------------------------------------
HUD finds support for this interpretation in the surrounding
provisions in HERA and in the legislative history of the amendment to
section 203(b)(9). First, HERA itself authorized governmental
homeownership programs that include a cash investment component, and
interpreting section 203(b)(9)(C) to deny FHA insurance to mortgages
resulting from such programs would frustrate their statutory purpose.
In section 2301 of HERA, Congress authorized the first increment of
funding for the Neighborhood Stabilization Program (NSP). NSP provides
funds to low- and moderate-income homebuyers for the cash investment on
purchasing lender-foreclosed single family properties when the property
will be the buyer's primary residence and is located in an eligible
target area. NSP funds are distributed through State and local
government agencies and instrumentalities. NSP funds are also used to
purchase vacant or distressed properties, which may then be resold by
the purchasing agency or instrumentality to low- or moderate-income
buyers with funds toward the minimum cash investment. Access to FHA
mortgage insurance is often essential to making such programs work.\26\
Thus, an interpretation of section 203(b)(9)(C) that precludes
governments and their agencies and instrumentalities government
agencies from providing funding toward the minimum cash investment for
an FHA-insured mortgage would undercut a central purpose of NSP and
similar Federal, State, and local government programs.\27\
---------------------------------------------------------------------------
\26\ HERA was enacted in 2008. FHA data shows that in that year,
there was a dramatic increase in FHA's market share. From 2005
through 2007, FHA's market share ranged from 2.6 to 3.9% of the
national mortgage market. In 2008, it rose to almost 20% of the
market share. See ``FHA-Insured Single Family Mortgage Originations
and Market Share Report, 2009-Q4, http://portal.hud.gov/hudportal/documents/huddoc?id=DOC_16681.pdf (last visited 7-3-2012). See also
FHA's Annual Report to Congress on the Fiscal Year 2012 Financial
Status of the FHA Mutual Mortgage Insurance Fund, issued November
16, 2012, which has updated information on FHA's market share, at
http://portal.hud.gov/hudportal/HUD?src=/press/press_releases_media_advisories/2012/HUDNo.12-171.
\27\ See United Savings Ass'n v. Timbers of Inwood Forest
Assocs., Ltd., 484 U.S. 365, 371 (1988) (statutory provisions should
be interpreted to avoid interpreting inconsistencies between
provisions); see also Babitt v. Sweet Home Chapter of Communities
for a Great Oregon, 515 U.S. 687 (1995); Gade v. Nat'l Solid Waste
Management Ass'n, 505 U.S. 88, 100-01 (1992).
---------------------------------------------------------------------------
Second, the legislative history of the amendment to section
203(b)(9)(C) also supports HUD's interpretation that it does not
exclude State and local government home ownership programs from FHA
insurance eligibility. In a statement supporting the amendment to
section 203(b)(9)(C), Senator Dodd explained that ``this bill
eliminates the seller-funded downpayment assistance program.'' \28\
There is no indication that State and local governments or their
agencies or instrumentalities were to be within the scope of the
amendment. The Senate Committee Report accompanying a 2007 bill
containing statutory language \29\ identical to what was eventually
enacted in HERA further support this interpretation. The report
explained that the ``section also prohibits seller-funded downpayment
entities from providing any of this required cash investment.'' \30\ It
noted that ``[s]ince this legislation was passed by the Committee, HUD
has promulgated a regulation that also prohibits these entities from
providing downpayment assistance funds.'' \31\ As discussed above, the
2007 HUD rule to which the Senate Report refers expressly excluded
State and local government agencies and instrumentalities from the
category prohibited sources for the minimum cash investment. The
report's identification of ``seller-funded downpayment entities'' as
the targets of both HUD's proposed rule and of the bill indicates that
the provision, which is identical to what was enacted in HERA, does not
include State and local governments or their agencies or
instrumentalities.
---------------------------------------------------------------------------
\28\ See 154 Cong. Rec. S6354-S6356 (July 7, 2008) available at
http://www.gpo.gov/fdsys/pkg/CREC-2008-07-07/html/CREC-2008-07-07-pt1-PgS6354-2.htm.
\29\ See FHA Modernization Act of 2007, S. 2338, (2007) Sec.
103.
\30\ S. Rep. No. 110-227, at 6 (Nov.13, 2007), available at
http://www.gpo.gov/fdsys/pkg/CRPT-110srpt227/pdf/CRPT-110srpt227.pdf.
\31\ Id. (emphasis added).
---------------------------------------------------------------------------
B. Scope of Interpretive Rule
Under section 203(b)(9)(A) of the NHA, the homebuyer's investment
in the property must be at least 3.5 percent of its appraised value. So
long as the homebuyer makes this minimum required investment from his
or her own (or other approved) funds, any person, even one associated
with the transaction, may contribute additional funds towards the
borrower's costs without violating section 203(b)(9)(C). This
interpretive rule only applies to funds that constitute all or part of
the
[[Page 72223]]
3.5 percent minimum investment requirement.
C. Conclusion
Accordingly, HUD interprets NHA section 203(b)(9)'s ``prohibited
sources'' provision in subsection (C) as not including funds provided
directly by Federal, State, or local governments, or their agencies and
instrumentalities in connection with their respective homeownership
programs.
D. Solicitation of Comment
This interpretive rule represents HUD's interpretation of section
203(b)(9)(C) and is exempt from the notice and comment requirements of
the Administrative Procedure Act. See 5 U.S.C. 553(b)(3)(A).
Nevertheless, HUD is interested in receiving feedback from the public
on this interpretation, specifically with respect to clarity and scope.
Dated: November 29, 2012.
Helen R. Kanovsky,
General Counsel.
[FR Doc. 2012-29361 Filed 12-4-12; 8:45 am]
BILLING CODE 4210-67-P