[Federal Register Volume 78, Number 101 (Friday, May 24, 2013)]
[Proposed Rules]
[Pages 31451-31454]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-12456]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 5
[Docket No. FR-5586-P-01]
RIN 2501-AD60
Pet Ownership for the Elderly or Persons With Disabilities in
Multifamily Rental Housing; Accumulation of Deposits for Costs
Attributable to Pets
AGENCY: Office of the Secretary, HUD.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: HUD regulations governing multifamily rental housing for the
elderly or persons with disabilities allow for the residents of such
housing to own common household pets, subject to the residents' paying
a refundable pet deposit. Currently, the regulations require that
owners of HUD-assisted multifamily rental housing for the elderly or
persons with disabilities
[[Page 31452]]
collect the deposit and any increases in the deposit from the pet owner
only through gradual accumulation; that is, an initial payment followed
by subsequent monthly payments. This requirement does not exist for
public housing agencies (PHAs) and owners of other HUD-assisted
multifamily rental housing. Rather, HUD regulations provide PHAs and
owners of other HUD-assisted multifamily rental housing discretion to
determine whether to gradually accumulate a pet deposit and any
increases to the pet deposit. This proposed rule would provide owners
of HUD-assisted multifamily rental housing for the elderly or persons
with disabilities, now subject to the gradual-accumulation pet deposit
requirement, with the same flexibility, thereby bringing consistency to
the pet deposit requirements for HUD programs and better enabling
owners of such housing to handle the costs associated with pet
ownership by tenants. This proposed rule only applies to policies for
pets and not to service or assistance animals for persons with
disabilities.
DATES: Comment Due Date: July 23, 2013.
ADDRESSES: Interested persons are invited to submit comments regarding
this proposed 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
proposed 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 advance appointment to review the public comments must be
scheduled 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 toll-free 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: Marie D. Head, Deputy Assistant
Secretary for Multifamily Housing Programs, Department of Housing and
Urban Development, 451 7th Street SW., Room 6106, Washington, DC 20410-
8000; telephone number 202-708-2495 (this is not a toll-free number).
Persons with hearing or speech impairments may access this telephone
number through TTY by calling the toll-free Federal Relay Service at
800-877-8339.
SUPPLEMENTARY INFORMATION:
I. Background
Section 227 of the Housing and Urban-Rural Recovery Act of 1983 (12
U.S.C. 1701r-1), provides for the ownership of common household pets in
HUD's public and other HUD-assisted multifamily rental housing for the
elderly or persons with disabilities. Section 227(a) provides that no
owner or manager of federally assisted housing for the elderly or
persons with disabilities \1\ may, as a condition of tenancy: (1)
Prohibit or prevent any tenant from owning or having common household
pets living in the dwelling accommodations or (2) restrict or
discriminate against any person in connection with admission to, or
continued occupancy of, covered housing because of the ownership of
such pets or their presence in the dwelling accommodations. HUD's
regulations implementing section 227 are codified at 24 CFR part 5,
subpart C (entitled ``Pet Ownership for the Elderly or Persons with
Disabilities'') (Sec. Sec. 5.300 to 5.380). These regulations apply to
rental housing assisted by HUD under the following programs: (1) The
public housing program, (2) programs administered by the Assistant
Secretary for Housing-Federal Housing Commissioner, and (3) programs
for which the governing regulations are in 24 CFR Chapter VIII.
---------------------------------------------------------------------------
\1\ The term used in this 1983 statute is ``handicapped.''
---------------------------------------------------------------------------
This rule only addresses HUD programs that fall within the second
and third categories; specifically, the: (1) Rent Supplements (24 CFR
part 200, subpart W), (2) Rental Assistance Payments (24 CFR part 236,
subpart D), (3) Section 8 New Construction (24 CFR part 880), (4)
Section 8 Substantial Rehabilitation (24 CFR part 881), (5) Section 8
State Housing Agencies (24 CFR part 883), (6) Section 8 Set-Aside for
Rural Rental Housing Projects (24 CFR part 884), (7) Section 8 Loan
Management Set-Aside and Property Disposition (24 CFR part 886), (8)
Section 202 Supportive Housing for the Elderly (24 CFR part 811,
subpart B), (9) Section 811 Supportive Housing for Persons with
Disabilities (24 CFR part 891, subpart C), and (10) Section 811 Project
Rental Assistance Demonstration Program. For purposes of brevity and
convenience, rental housing assisted under these programs is
collectively referred to as ``covered multifamily rental housing.''
For tenants residing in covered multifamily rental housing, Sec.
5.318(d)(2)(iii) currently requires the gradual accumulation of the
deposit by the pet owner, through an initial payment not to exceed $50
when the pet is brought onto the premises and subsequent monthly
payments not to exceed $10 per month until the amount of the deposit is
reached. Section 5.318(d)(2) requires HUD to set the maximum pet
deposit by notice, currently set at $300.\2\ Section 5.318(d)(2)(v)(A)
also requires a gradual accumulation of any increase in the deposit,
not to exceed $10 per month for these tenants.
---------------------------------------------------------------------------
\2\ See HUD, No. 4350.3 REV-1, Occupancy Requirements of
Subsidized Multifamily Housing Programs (2009) at 6-24.
---------------------------------------------------------------------------
Other covered multifamily rental housing is subject to Sec.
5.318(d)(2)(iv), which provides the owner with the discretion of
establishing rules that ``may provide for the gradual accumulation of
the deposit by the pet owner.'' The requirements for public housing are
codified at Sec. 5.318(d)(3), and similarly provide that the pet rules
adopted by a PHA ``may permit gradual
[[Page 31453]]
accumulation of the pet deposit by the pet owner.''
HUD's March 8, 1996, final rule (61 FR 9536) establishing the pet
ownership regulations explained that the differing requirements
governing deposits were based on the fact that tenants in the affected
covered multifamily rental housing are, as a general rule, lower income
and may have difficulty making the pet deposit. While this is still
generally true, the regulatory mandate that owners gradually accumulate
deposit amounts has also sometimes imposed an undue hardship for owners
of covered multifamily housing. When funds are needed for repairs and
replacements, fumigation, and animal care facilities shortly after a
tenant brings a pet onto the premises, the accumulated pet deposit may
be insufficient to pay repair and clean-up costs. Consequently, the
owner may have to use the housing's Reserve for Replacement account or
the tenant's security deposit to fund required repairs if a sufficient
pet deposit has not been accumulated.
II. This Proposed Rule
To address this concern and distinction in HUD regulations, the
proposed rule would amend the regulations to no longer mandate the
gradual accumulation of pet deposits in the covered multifamily rental
housing, and provide owners of such housing with the discretion to: (1)
Provide for the gradual accumulation of the pet deposit, and (2)
provide for the gradual accumulation of approved pet deposit
increases.\3\ In making this regulatory change, owners of covered
multifamily rental housing would not be prohibited from providing for
gradual accumulation of the deposit and increases in the pet deposit by
the pet owner. The proposed rule will enable owners to determine how to
collect the pet owner deposit based on the same rules that apply to
other HUD-assisted rental housing; however, owners should consider the
income characteristics of its tenants when setting pet deposit policies
and are encouraged to continue to provide for gradual accumulation from
lower-income residents where economically feasible given the costs of
operating the housing project.
---------------------------------------------------------------------------
\3\ This proposed rule only applies to policies for pets and not
to service or assistance animals for persons with disabilities.
Service and assistance animals are covered by separate HUD
regulations at 24 CFR 5.303.
---------------------------------------------------------------------------
III. Cost and Benefits of the Proposed Rule
As discussed in this preamble, the purpose of this proposed rule is
to bring consistency to the pet deposit requirements for HUD programs
and better enable owners of such housing to handle the costs associated
with pet ownership by tenants. While difficult to predict, HUD has
determined that the discounted benefits of the proposed rule may cause
negligible transfers to tenants if the owner of their dwelling chooses
to opt out of the gradual payment requirement. Assuming a pet deposit
in a range from $100 to $300 and a 3 or 7 percent annual discount rate,
the financial impact of the rule may range from $232,000 to $9.86
million.
Currently, about 936,000 households in HUD assisted multifamily
rental housing are classified as either elderly or disabled and will
potentially be impacted by the change in regulation. It is very
unlikely, however, that all elderly or disabled households in the
concerned programs will own a pet and therefore be subject to the rule.
Recognizing that about 62 percent of households in the United States
own a pet, and applying that proportion to our target population, we
derive an estimate of the number of affected households to be 580,000.
We also make the cautious assumption that all of the 580,000 households
are affected. The rule provides owners of housing the option to collect
upfront fees. The total impact (cost to the tenants) will be as
follows:
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Pet deposit
----------------------------------------------------------------------------------------------------------------
Status-Quo (Current Rule with Gradual Payment).................. $100 $200 $300
--Upfront Payment........................................... 50 50 50
--Monthly Payment........................................... 10 10 10
--Number of Months.......................................... 5 15 25
Present value payments at 3% annual discount.................... 99.60 197 292
Present value payments at 7% annual discount.................... 99.20 193 283
Cost of Rule (per Household at 3%).............................. 0.40 3 8
Cost of Rule (per Household at 7%).............................. 0.80 7 17
Total Elderly or Disabled Household in HUD Multifamily Rental 580,000 580,000 580,000
Housing that own pets..........................................
Total Potential Impact (per Household at 3%).................... 232,000 1,740,000 4,640,000
Total Potential Impact (per Household at 7%).................... 464,000 4,060,000 9,860,000
----------------------------------------------------------------------------------------------------------------
The potential benefits of the rule include a reduced burden on
owners who have to cover costs associated with repairs, replacements,
fumigation, and animal facilities when such costs result from pets on
the premises and accrue before the entire pet deposit is accumulated
and decrease the time and money spent to manage the gradual
accumulation of the required pet deposit. There are also administrative
costs associated with the management of pet-deposit accounts. Under
current HUD regulations, there is a need to manage the gradual
accumulation of the required pet deposit and the proposed rule will
eliminate such a need. The implementation of this proposed rule will
result in some savings, however small, for the owners if they do not
have to manage the monthly payments of pet deposits.
Based on this analysis, HUD has determined that the implementation
of this proposed rule will not be economically significant under
Executive Order 12866 \4\ and OMB Circular A- 4.\5\
---------------------------------------------------------------------------
\4\ Office of Management and Budget, Economic Analysis of
Federal Regulations Under Executive Order 12866, January 11, 1996,
http://www.whitehouse.gov/omb/inforeg/riaguide.html.
\5\ http://www.whitehouse.gov/omb/inforeg/cirular-a4.pdf.
---------------------------------------------------------------------------
IV. Findings and Certifications
Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) (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.
This proposed rule would revise HUD's regulations governing the manner
in which an owner of covered multifamily rental housing may require
tenants of such
[[Page 31454]]
housing who maintain pets to pay a pet deposit. As discussed in the
preamble, owners of covered multifamily rental housing were subject to
different rules concerning pet deposits than rules that applied to
other HUD-assisted rental housing. This proposed rule would provide
owners of such covered multifamily rental housing with the discretion
to determine whether to gradually accumulate a pet deposit, thereby
bringing consistency to the pet deposit requirements for HUD rental
housing programs and better enabling owners to handle the costs
associated with pet ownership by tenants. Accordingly, the undersigned
certifies that this rule will not have a significant economic impact on
a substantial number of small entities.
Notwithstanding HUD's determination that this rule will not have a
significant economic impact on a substantial number of small entities,
HUD specifically invites comments regarding less burdensome
alternatives to this rule that will meet HUD's objectives as described
in this preamble.
Environmental Impact
This proposed 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 rule
is categorically excluded from environmental review under the National
Environmental Policy Act of 1969 (42 U.S.C. 4321).
Executive Order 13132, 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 preempts state law,
unless the agency meets the consultation and funding requirements of
section 6 of the Executive Order. This proposed rule would not have
federalism implications and would not impose substantial direct
compliance costs on state and local governments or preempt state law
within the meaning of the Executive Order.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C.
1531-1538) (UMRA) establishes requirements for Federal agencies to
assess the effects of their regulatory actions on state, local, and
tribal governments, and on the private sector. This rule does not
impose any Federal mandates on any state, local, or tribal governments,
or on the private sector, within the meaning of the UMRA.
Lists of Subjects in 24 CFR Part 5
Administrative practice and procedure, Aged, Claims, Crime,
Government contracts, Grant programs--housing and community
development, Individuals with disabilities, Intergovernmental
relations, Loan programs--housing and community development, Low and
moderate income housing, Mortgage insurance, Penalties, Pets, Public
housing, Rent subsidies, Reporting and recordkeeping requirements,
Social security, Unemployment compensation, Wages.
For the reasons set forth in the preamble, HUD proposes to amend 24
CFR part 5 as follows:
PART 5--GENERAL HUD PROGRAM REQUIREMENTS; WAIVERS
0
1. The authority citation for 24 CFR part 5 continues to read as
follows:
Authority: 42 U.S.C. 1437a, 1437c, 1437d, 1437f, 1437n,
3535(d), Sec. 327, Pub. L. 109-115, 119 Stat. 2936, and Sec. 607,
Pub. L. 109-162, 119 Stat. 3051.
0
2. Amend Sec. 5.318 as follows:
0
a. Revise paragraphs (d)(2)(iii) and (iv);
0
b. Remove paragraph (d)(2)(v); and
0
c. Redesignate paragraph (d)(2)(vi) as (d)(2)(v).
The revisions read as follows:
Sec. 5.318 Discretionary pet rules.
* * * * *
(d) * * *
(2) * * *
(iii) The pet rules may provide for gradual accumulation of the pet
deposit by the pet owner.
(iv) The project owner may (subject to the HUD-prescribed limits)
provide for gradual accumulation of an increase in the amount of the
pet deposit by amending the house pet rules in accordance with Sec.
5.353.
* * * * *
Dated: May 1, 2013.
Shaun Donovan,
Secretary.
[FR Doc. 2013-12456 Filed 5-23-13; 8:45 am]
BILLING CODE 4210-67-P