[Federal Register Volume 60, Number 104 (Wednesday, May 31, 1995)] [Rules and Regulations] [Pages 28319-28321] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 95-13243] ----------------------------------------------------------------------- DEPARTMENT OF AGRICULTURE Rural Housing and Community Development Service Rural Business and Cooperative Development Service Rural Utilities Service Consolidated Farm Service Agency 7 CFR Parts 1955, 1962, and 1965 Administrative Changes to Provide Authority to Approve Releases of Liability in Connection with Voluntary Liquidations AGENCIES: Rural Housing and Community Development Service, Rural Business and Cooperative Development Service, Rural Utilities Service, and Consolidated Farm Service Agency, USDA. ACTION: Final rule. ----------------------------------------------------------------------- SUMMARY: The Consolidated Farm Service Agency (CFSA) is the successor to the Farmers Home Administration pursuant to Section 226 of the Department of Agriculture Reorganization Act of 1994 (Pub. L. 103-354, October 13, 1994). The CFSA amends its Property Management, Chattel Property, and Real Property regulations to conform with changes made to its debt settlement regulations in April 1993. These conforming changes are made to give State Directors release of liability authority for borrowers whose total indebtness is less than one million dollars. The intended effect is to expedite the processing of requests from borrowers who are unable to repay all of their CFSA debts. EFFECTIVE DATE: May 31, 1995. FOR FURTHER INFORMATION CONTACT: Edward R. Yaxley, Jr., Senior Loan Officer, Farm Credit Programs Loan Servicing and Property Management Division, Consolidated Farm Service Agency, USDA, room 5449, South Agriculture Building, 14th and Independence Avenue SW., [[Page 28320]] Washington, DC 20250, telephone (202) 720-4572. SUPPLEMENTARY INFORMATION: Classification This action is not subject to the provisions of Executive Order 12866 because it involves only internal agency management and it has no impact on CFSA borrowers or other members of the public. This action is not published for notice and comment under the Administrative Procedure Act since the changes only involve internal processing of documents by CFSA employees which will expedite the administrative review process for releases of liability, permitting more timely debt relief to CFSA borrowers, and consequently reducing the Agency's portfolio of inactive uncollectible accounts. It is published so that CFSA borrowers will be aware of the authority of State Directors to execute releases from liability for certain debts. Paperwork Reduction Act The information collection requirements contained in these regulations have been approved by the Office of Management and Budget (OMB) under the provisions of 44 U.S.C. Chapter 35 and have been assigned OMB control numbers 057-0109 and 057-0086. This final rule does not revise or impose any new information collection requirement from those previously approved by OMB. Background The CFSA amends its Property Management, Chattel Property, and Real Property regulations to conform with changes made to its debt settlement regulations on April 21, 1993 (58 FR 21344). These conforming changes are made to give State Directors release of liability authority for borrowers whose total indebtness (including principal, interest and other charges) is less than one million dollars. This action only involves internal processing of documents by CFSA employees which will expedite the administrative review process for releases of liability, permitting more timely debt relief to CFSA borrowers, and consequently reducing the Agency's portfolio of inactive uncollectible accounts. It is helpful to CFSA borrowers to know the authority levels for releases of liability by State Directors. The procedure for the release in all cases is set forth in 7 CFR part 1956, subpart B. CFSA amends subpart A of part 1955: (1) Section 1955.10(f)(2) to give State Directors authority to accept and process offers to convey real property when the unsatisfied CFSA indebtness is less than $1,000,000. (2) Section 1955.20(b)(2) to give State Directors authority to accept and process offers to convey chattel property when the unsatisfied CFSA indebtness is less than $1,000,000. CFSA amends subpart A of part 1962: (1) Section 1962.34(h) to give State Directors authority to approve the transfer and assumption of CFSA accounts to eligible and ineligible transferees and release the transferors of liability when the CFSA debt secured by chattels minus their market value is less than $1,000,000. CFSA amends subpart A of part 1965: (1) Section 1965.26(f)(5)(ii) to give State Directors authority to approve release of liability for borrowers whose outstanding CFSA debt after a cash sale of real property is less than $1,000,000. (2) Section 1965.27(f) to give State Directors authority to approve the transfer and assumption of CFSA accounts to eligible and ineligible transferees and release the transferors of liability when the CFSA debt secured by real property minus its market value is less than $1,000,000. Programs Affected The programs are listed in the Catalog of Federal Domestic Assistance (CFDA) under: 10.404 Emergency Loans 10.406 Farm Operating Loans 10.407 Farm Ownership Loans 10.410 Low Income Housing Loans 10.411 Rural Housing Site Loans 10.415 Rural Rental Housing Loans 10.416 Soil and Water Loans 10.417 Very Low-Income Housing Repair Loans and Grants Environmental Impact Statement This document has been reviewed in accordance with 7 CFR part 1940, subpart G, ``Environmental Program.'' CFSA has determined that this action does not constitute a major Federal action significantly affecting the quality of the human environment, and in accordance with the National Environmental Policy Act of 1969, Pub. L. 91-190, an Environmental Impact Statement is not required. List of Subjects 7 CFR Part 1955 Foreclosure, Government acquired property. 7 CFR Part 1962 Crops, Government property, Livestock, Loan programs--Agriculture, Rural areas. 7 CFR Part 1965 Foreclosure, Loan programs--Agriculture, Rural areas. Therefore, chapter XVIII, title 7, Code of Federal Regulations is amended as follows: PART 1955--PROPERTY MANAGEMENT 1. The authority citation for part 1955 continues to read as follows: Authority: 7 U.S.C. 1989; 42 U.S.C. 1480; 5 U.S.C. 301; 7 CFR 2.23 and 2.70. Subpart A--Liquidation of Loans Secured by Real Estate and Acquisition of Real and Chattel Property 2. Section 1955.10 is amended by revising the third and the last sentences of paragraph (f)(2)(ii) to read as follows: Sec. 1955.10 Voluntary conveyance of real property by the borrower to the Government. * * * * * (f) * * * (2) * * * (ii) * * * When the Agency debt less the market value and prior liens is $1 million or more (including principal, interest and other charges), release of liability must be approved by the Administrator or designee; otherwise, the State Director must approve the release of liability. All cases requiring a release of liability will be submitted for review in accordance with exhibit A of subpart B of part 1956 of this chapter (available in any CFSA office). * * * * * 3. Section 1955.20 is amended by revising the third sentence of paragraph (b)(2) to read as follows: Sec. 1955.20 Acquisition of chattel property. * * * * * (b) * * * (2) * * * When the Agency debt less the market value and prior liens is $1 million or more (including principal, interest and other charges), release of liability must be approved by the Administrator or designee; otherwise, the State Director must approve the release of liability. * * * * * * * * PART 1962--PERSONAL PROPERTY 4. The authority citation for part 1962 continues to read as follows: Authority: 7 U.S.C. 1989; 42 U.S.C. 1480; 5 U.S.C. 301; 7 CFR 2.23; 7 CFR 2.70. [[Page 28321]] Subpart A--Servicing and Liquidation of Chattel Security 5. Section 1962.34 is amended by revising the second sentence of paragraph (h) to read as follows: Sec. 1962.34 Transfer of chattel security and EO property and assumption of debts. * * * * * (h) * * * When the Agency debt less the market value and prior liens is $1 million or more (including principal, interest and other charges), release of liability must be approved by the Administrator or designee; otherwise, the State Director must approve the release of liability. * * * PART 1965--REAL PROPERTY 6. The authority citation for part 1965 continues to read as follows: Authority: 7 U.S.C. 1989; 42 U.S.C. 1480; 5 U.S.C. 301; 7 CFR 2.23; 7 CFR 2.70. Subpart A--Servicing of Real Estate Security for Farmer Program Loans and Certain Note-Only Cases 7. Section 1965.26 is amended by revising the first sentence of paragraph (f)(5)(ii) to read as follows: Sec. 1965.26 Liquidation action. * * * * * (f) * * * (5) * * * (ii) When the Agency debt less the market value and prior liens is $1 million or more (including principal, interest and other charges), release of liability must be approved by the Administrator or designee; otherwise, the State Director must approve the release of liability. * * * * * * * * 8. Section 1965.27 is amended by revising the second sentence of paragraph (f) to read as follows: Sec. 1965.27 Transfer of real estate security. * * * * * (f) * * * When the Agency debt less the market value and prior liens is $1 million or more (including principal, interest and other charges), release of liability must be approved by the Administrator or designee; otherwise, the State Director must approve the release of liability. * * * * * * * * Dated: May 3, 1995. Eugene Moos, Under Secretary, Farm and Foreign Agricultural Services. Dated: May 3, 1995. Michael V. Dunn, Acting Under Secretary, Rural Economic and Community Development. [FR Doc. 95-13243 Filed 5-30-95; 8:45 am] BILLING CODE 3410-07-V