[Federal Register Volume 61, Number 50 (Wednesday, March 13, 1996)]
[Rules and Regulations]
[Pages 10440-10442]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-5989]
[[Page 10439]]
_______________________________________________________________________
Part IV
Department of Housing and Urban Development
_______________________________________________________________________
24 CFR Part 1720 et al.
Streamlining Interstate Land Sales, Manufactured Housing Construction
and Safety, and Real Estate Settlement Procedures Act Programs--
Investigations; Final Rule
Federal Register / Vol. 61, No. 50 / Wednesday, March 13, 1996 /
Rules and Regulations
[[Page 10440]]
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Office of the Assistant Secretary for Housing-Federal Housing
Commissioner
24 CFR Parts 1720, 3282, 3500, and 3800
[Docket No. FR-4026-F-01]
RIN 2502-AG71
Streamlining Interstate Land Sales, Manufactured Housing
Construction and Safety Standards, and Real Estate Settlement
Procedures Act Programs--Investigations
AGENCY: Office of the Assistant Secretary for Housing-Federal Housing
Commissioner, HUD.
ACTION: Final rule.
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SUMMARY: This final rule amends HUD's regulations for three consumer
protection regulatory programs by consolidating and streamlining the
provisions relating to investigations. These programs, over which the
Secretary has investigative authority, are Interstate Land Sales, the
Real Estate Settlement Procedures Act, and Manufactured Housing
Construction and Safety Standards, which are now reorganized under one
office, the Office of Consumer and Regulatory Affairs (hereafter
collectively referred to as ``consumer regulatory programs''). In an
effort to comply with the President's regulatory reform initiatives,
this rule will streamline the regulations of these consumer regulatory
programs by eliminating provisions that are redundant or are otherwise
unnecessary. This final rule will make the consumer regulatory program
regulations clear and concise.
EFFECTIVE DATE: April 12, 1996.
FOR FURTHER INFORMATION CONTACT: Rebecca Holtz, Attorney, Room 9253,
Department of Housing and Urban Development, 451 Seventh Street, SW.,
Washington, DC 20410, telephone number (202) 708-3088 (this is not a
toll-free number). For hearing- and speech-impaired persons, this
number may be accessed via TDD by calling the Federal Information Relay
Service at 1-800-877-8339.
SUPPLEMENTARY INFORMATION: On March 4, 1995, President Clinton issued a
memorandum to all Federal departments and agencies regarding regulatory
reinvention. In response to this memorandum, the Department of Housing
and Urban Development conducted a page-by-page review of its
regulations to determine which can be eliminated, consolidated, or
otherwise improved. HUD has determined that the regulations for three
consumer protection regulatory programs--Interstate Land Sales, RESPA,
and Manufactured Housing Construction and Safety Standards--can be
improved and streamlined by consolidating similar provisions relating
to investigations and eliminating unnecessary provisions. This rule
includes these streamlined provisions in a new part 3800 of the
Department's regulations. The consolidation of these provisions will
simplify compliance with and understanding of the requirements and
rights in investigations under these programs.
Several provisions in the regulations repeat statutory language
from the Interstate Land Sales Full Disclosure Act, the National
Manufactured Housing Construction and Safety Standards Act of 1974, and
the Real Estate Settlement Procedures Act of 1974. It is unnecessary to
maintain statutory requirements in the Code of Federal Regulations
(CFR), since those requirements are otherwise fully accessible and
binding. Furthermore, if regulations contain statutory language, HUD
must amend the regulations whenever Congress amends the statute.
Therefore, this final rule will remove repetitious statutory language
and replace it with a citation to the specific statutory section for
easy reference.
Other provisions in the regulations apply to more than one program,
and HUD repeated these provisions in different subparts. This
repetition is unnecessary, and updating these scattered provisions is
cumbersome, often creating confusion. Therefore, this final rule
consolidates these duplicative provisions, maintaining appropriate
cross-references for the reader's convenience. The rule also makes
conforming changes in parts 1720, 3282, and 3500 of title 24, to
reference the new part 3800.
Lastly, some provisions in the regulations are not regulatory
requirements. For example, several sections in the regulations contain
nonbinding guidance or explanations. While this information is very
helpful to recipients, HUD will appropriately provide this information
through handbook guidance or other materials rather than maintain it in
the CFR.
Justification for Final Rulemaking
HUD generally publishes a rule for public comment before issuing a
rule for effect, in accordance with its own regulations on rulemaking
in 24 CFR part 10. However, part 10 provides for exceptions to the
general rule if the agency finds good cause to omit advance notice and
public participation. The good cause requirement is satisfied when
prior public procedure is ``impracticable, unnecessary, or contrary to
the public interest'' (24 CFR 10.1). HUD finds that good cause exists
to publish this rule for effect without first soliciting public
comment. This rule consolidates similar requirements and removes
unnecessary regulatory provisions; it does not make substantive changes
in the program regulations. Therefore, prior public comment is
unnecessary.
Other Matters
Regulatory Flexibility Act
The Secretary, in accordance with the Regulatory Flexibility Act (5
U.S.C. 605(b)), has reviewed and approved this final rule, and in so
doing certifies that this rule will not have a significant economic
impact on a substantial number of small entities. This rule merely
streamlines regulations by removing unnecessary provisions. The rule
will have no adverse or disproportionate economic impact on small
businesses.
Environmental Impact
This rulemaking does not have an environmental impact. This
rulemaking simply amends an existing regulation by consolidating and
streamlining provisions and does not alter the environmental effect of
the regulations being amended. A Finding of No Significant Impact with
respect to the environment was made in accordance with HUD regulations
in 24 CFR part 50 that implement section 102(2)(C) of the National
Environmental Policy Act of 1969 (42 U.S.C. 4332) at the time of
development of regulations implementing the consumer regulatory
programs. That finding remains applicable to this rule and is available
for public inspection between 7:30 a.m. and 5:30 p.m. weekdays in the
Office of the Rules Docket Clerk, Office of General Counsel, Room
10276, Department of Housing and Urban Development, 451 Seventh Street,
SW, Washington, DC.
Executive Order 12612, Federalism
The General Counsel, as the Designated Official under section 6(a)
of Executive Order 12612, Federalism, has determined that this rule
will not have substantial direct effects on States or their political
subdivisions, or the relationship between the Federal government and
the States, or on the distribution of power and responsibilities among
the various
[[Page 10441]]
levels of government. No programmatic or policy changes will result
from this rule that would affect the relationship between the Federal
Government and State and local governments.
Executive Order 12606, The Family
The General Counsel, as the Designated Official under Executive
Order 12606, The Family, has determined that this rule will not have
the potential for significant impact on family formation, maintenance,
or general well-being, and thus is not subject to review under the
Order. No significant change in existing HUD policies or programs will
result from promulgation of this rule.
The Catalog of Federal Domestic Assistance program numbers are
14.168 and 14.171.
List of Subjects
24 CFR Part 1720
Administrative practice and procedure.
24 CFR Part 3282
Administrative practice and procedure, Consumer protection,
Intergovernmental relations, Investigations, Manufactured homes,
Reporting and recordkeeping requirements, Warranties.
24 CFR Part 3500
Consumer protection, Condominiums, Housing, Mortgages, Mortgage
servicing, Reporting and recordkeeping requirements.
24 CFR Part 3800
Administrative practice and procedure, Consumer protection,
Investigations, Manufactured homes, Mortgages, Mortgage servicing,
Reporting and recordkeeping requirements.
For the reasons set out in the preamble, under the authority of 42
U.S.C. 3535(d), title 24 of the Code of Federal Regulations is amended
by adding a new part 3800, and by amending parts 1720, 3282, and 3500,
as follows:
1. A new part 3800 is added to read as follows:
PART 3800--INVESTIGATIONS IN CONSUMER REGULATORY PROGRAMS
Sec.
3800.10 Scope of rules.
3800.20 Subpoenas in investigations.
3800.30 Subpoena enforcement in district court.
3800.40 Investigational proceedings.
3800.50 Rights of witnesses in investigational proceedings.
3800.60 Settlements.
Authority: 12 U.S.C. 2601 et seq.; 15 U.S.C. 1714; 42 U.S.C.
3535(d) and 5413.
Sec. 3800.10 Scope of rules.
This part applies to investigations and investigational proceedings
undertaken by the Secretary, or the Secretary's designee, pursuant to
the following:
(a) The Interstate Land Sales Full Disclosure Act, 15 U.S.C. 1701
et seq.;
(b) The National Manufactured Housing Construction and Safety
Standards Act of 1974, 42 U.S.C. 5401 et seq.; and
(c) The Real Estate Settlement Procedures Act of 1974, 12 U.S.C.
2601 et seq.
Sec. 3800.20 Subpoenas in investigations.
(a) The Secretary may issue subpoenas relating to any matter under
investigation. A subpoena may:
(1) Require testimony to be taken by interrogatories;
(2) Require the attendance and testimony of witnesses at a specific
time and place;
(3) Require access to, examination of, and the right to copy
documents; and
(4) Require the production of documents at a specific time and
place.
(b) A subpoenaed person may petition the Secretary or the
Secretary's designee to modify or withdraw a subpoena by filing the
petition within 10 days after service of the subpoena. The petition may
be in letter form, but must set forth the facts and law upon which the
petition is based.
Sec. 3800.30 Subpoena enforcement in district court.
In the case of contumacy of a witness or a witness's refusal to
obey a subpoena or order of the Secretary, the United States district
court for the jurisdiction in which an investigation is carried on may
issue an order requiring compliance with the subpoena. HUD headquarters
in Washington, D.C., is one of the locations in which the Secretary
carries on investigations of its consumer regulatory programs.
Sec. 3800.40 Investigational proceedings.
(a) For the purpose of hearing the testimony of witnesses and
receiving documents and other data relating to any subject under
investigation, the Secretary, or the Secretary's designee, may conduct
an investigational proceeding.
(b) The Secretary, or the Secretary's designee, (``presiding
official'') shall preside over the investigational proceeding. The
proceeding shall be stenographically or mechanically reported. A
transcript shall be a part of the record of the investigation.
(c) Unless the presiding official determines otherwise,
investigational proceedings shall be public.
(d) The presiding official shall take all necessary action to
regulate the course of the proceeding to avoid delay and to maintain
order. If necessary to maintain order, the presiding official may
exclude a witness or counsel from a proceeding. The Department may also
take further action as permitted by statute.
Sec. 3800.50 Rights of witnesses in investigational proceedings.
(a) Any person who testifies at a public investigational proceeding
shall be entitled, on payment of costs, to purchase a copy of a
transcript of the testimony the person provided.
(b) In a nonpublic investigational proceeding, the presiding
official may for good cause limit a witness to an inspection of the
official transcript of that witness's testimony.
(c) Any person subpoenaed to appear at an investigational
proceeding may be represented by counsel as follows:
(1) With respect to any question asked of a witness, a witness may
obtain confidential advice from counsel;
(2) If a witness refuses to answer a question, counsel for the
witness may briefly state the legal grounds for the refusal;
(3) Counsel for the witness may object to a question or a request
for production of documents that is beyond the scope of the
investigation or for which a privilege of the witness to refuse to
answer may be invoked. In so doing, counsel for the witness may state
briefly the grounds for the objection. Objections will be deemed
continuing throughout the course of the proceeding. Repetitious or
cumulative statements of an objection or the grounds for an objection
are unnecessary and impermissible; and
(4) After the Department's examination of a witness, counsel for
the witness may request that the witness be permitted to clarify any
answers to correct any ambiguity, equivocation, or incompleteness in
the witness's testimony. The decision to grant or deny this request is
within the sole discretion of the presiding official.
Sec. 3800.60 Settlements.
(a) At any time during an investigation, the Department and the
parties subject to an investigation may conduct settlement
negotiations.
(b) When the Secretary or Secretary's designee deems it
appropriate, the Department may enter into a settlement agreement.
[[Page 10442]]
PART 1720--FORMAL PROCEDURES AND RULES OF PRACTICE
1a. The authority citation for part 1720 is revised to read as
follows:
Authority: 15 U.S.C. 1718; 42 U.S.C. 3535(d).
Subpart A--Rules and Rule Making
2. Section 1720.10 is revised to read as follows:
Sec. 1720.10 Investigations and Conferences.
(a) In connection with a rulemaking proceeding, the Secretary may
conduct such investigations, make such studies, and hold such
conferences as are necessary. Investigations in connection with a
rulemaking may be conducted in accordance with the general
investigatory procedures under part 3800 of this chapter.
(b) At any such conferences, interested persons may appear to
express views and suggest amendments relative to proposed rules.
Subpart C--[Removed and Reserved]
3. Subpart C, consisting of Secs. 1720.45 through 1720.95, is
removed and reserved.
PART 3282--MANUFACTURED HOME PROCEDURAL AND ENFORCEMENT REGULATIONS
4. The authority citation for part 3282 continues to read as
follows:
Authority: 42 U.S.C. 3535(d) and 5424.
Subpart A--General
5. Section 3282.1(b) is amended by adding at the end a new
sentence, to read as follows:
Sec. 3282.1 Scope and purpose.
* * * * *
(b) * * * The procedures for investigations and investigational
proceedings are set forth in 24 CFR part 3800.
Subpart D--Informal and Formal Presentations of Views, Hearings and
Investigations
6. Section 3282.151 is amended by revising paragraph (a); removing
paragraph (c), and redesignating paragraphs (d) and (e) as paragraphs
(c) and (d), respectively, to read as follows:
Sec. 3282.151 Applicability and scope.
(a) This subpart sets out procedures to be followed when an
opportunity to present views provided for in the Act is requested by an
appropriate party. Section 3282.152 provides for two types of
procedures that may be followed, one informal and nonadversary, and one
more formal and adversary. Section 3282.152 also sets out criteria to
govern which type of procedure will be followed in particular cases.
* * * * *
7. Section 3282.155 is revised to read as follows:
Sec. 3282.155 Investigations.
The procedures for investigations and investigational proceedings
are set forth in part 3800 of this chapter.
PART 3500--REAL ESTATE SETTLEMENT PROCEDURES ACT
8. The authority citation for part 3500 is revised to read as
follows:
Authority: 12 U.S.C. 2601 et seq.; 42 U.S.C. 3535(d).
9. Section 3500.19 is amended by adding a new paragraph (e) to read
as follows:
Sec. 3500.19 Enforcement.
* * * * *
(e) Investigations. The procedures for investigations and
investigational proceedings are set forth in 24 CFR part 3800.
Sec. 3500.20 [Removed and Reserved]
10. Section 3500.20 is removed and reserved.
Dated: February 22, 1996.
Stephanie A. Smith,
Acting General Deputy, Assistant Secretary for Housing--Federal Housing
Commissioner.
[FR Doc. 96-5989 Filed 3-12-96; 8:45 am]
BILLING CODE 4210-27-P