FORM RD 2006

FORM RD 2006-46 (Rev. 01-98)

U.S. DEPARTMENT OF AGRICULTURE MANUAL ISSUE No.

RURAL DEVELOPMENT WSAL PN 458

Washington, D.C 20250 DATE

September 24, 2012

PROCEDURE NOTICE

RD MANUAL CHANGES

INSERT RD INS 440.1
(WSAL)

INTEREST RATES, AMORTIZATION, GUARANTEE FEE, ANNUAL CHARGE, AND FIXED PERIOD. Exhibit B is partially revised to update the Treasury Judgement rate and various program rates. The following are the Interest Rates for the months of July and September 1, 2012.

REMOVE                                INSERT
July:
Exhibit B: Pages 1 & 2 (Rev 46).     Exhibit B: Pages 1 & 2 (Rev 47).;

September:
Exhibit B: Pages 1 & 2 (Rev 47).     Exhibit B: Pages 1 & 2 (Rev 48);

INSERT RD INS 1901-A
(WSAL)

Loan and Grant Approval Authorities. This Instruction is partially revised to incorporate the newly implemented Rural Microentrepreneur Assistance Program within the Specialty Programs Division and to move the existing Rural Business Opportunity Grant Program, previously administered under the Specialty Programs Division to the Cooperative Services Program which now administers the program. In addition, remove all references to Water and Waste Program (WEP) since WEP no longer uses instruction.

REMOVE                                INSERT
All Pages;                            Pages 1 & 2 revised;
Exhibit A: Page 1;                   Exhibit A: Page 1 revised;
Exhibit B: Pages 1 & 2 (Rev 3),      Exhibit B: Pages 1 thru 5 revised; and
3 & 4 (Rev 2), 5 Rev 1); and        Exhibit F: Pages 1 revised 09-24-12.
Exhibit F: Page 1.

INSERT RD INS 1940-L
(WSAL)

Methodology and Formulas for Allocation of Loan and Grant Program Funds

Exhibit A, Attachment 1 is revised to update funding levels and provide guidance on how to apply for funding.

Exhibit A, Attachment 2 is revised to include the FY 12 funding for Community Facilities and provide guidance to the field staff on the methodology and formulas for the allocation of funds to the States.

REMOVE                                INSERT
Exhibit A;                            Exhibit A revised;
Exhibit A, Attachment 1,              Exhibit A, Attachment 1:
Exhibit A, Attachment 2,              Pages 1 thru 31 revised,.
                                      Exhibit A, Attachment 2:
                                      Pages 1 thru 12 revised 09-24-12.

INSERT RD INS 1942-A
(WSAL)

COMMUNITY FACILITIES GRANTS AND LOANS. The revised language and modifications to this Final Rule dated 05-18-12 with the effective date of 07-17-12 which is intended to clarify and conform the regulations with current private sector contract methods related to construction and development:

      - Guide 27, to reflect recent revisions to the American Institute of Architects (AIA) contracts;

      - Two new attachments are added to Guide 27 to be used with AIA Design/Build and Construction Management/Constructor
        contracts;- Remove a reference stating Design/Build and Construction Management may not be used with grant funds; and

      - Revised and expand language concerning the use of Design/Build and
      Construction Management, allowing Agency approvals at the State Office
      level in more instances.

The Rural Housing Service (Agency) is amending its Instruction to update contract guide documents and make minor revisions to streamline processing. The Instruction is partially revised as follows:

      - Community Facilities uses American Institute of Architects (AIA) contract documents for the majority of their development
        work. Every 10 years, AIA revises their contract documents. Presently, Guide 27 includes attachments to amend AIA
        documents dated 1997. These new revisions will conform with AIA documents dated 2007 for the architect’s agreement and
        construction contract.

      - Adding two new attachments to Guide 27. These attachments will amend AIA contract documents for Design/Build and
        Construction Management/Construction contracts. Although this Instruction allows these types of construction, the Agency
        has never had standardized guide documents to include Federal government financing requirements. Standardized guide
        documents will reduce staff time spent incorporating that language into contracts individually.

      - Removing a restrictive reference in section 1942.18(l) that states design/build and construction management type of
        construction may not be used with grant funds. This regulatory requirement was placed in the regulations in the 1970’s
        when the Agency had little/no experience with design/build or construction management. With the projects we have completed
        since then, it has become apparent that the type of funding – guide or direct loan – should have no bearing on the type of
        construction.

       - Adding language to clarify the type of Construction Management acceptable to the Agency. Since Construction Management
        was placed in the regulation in the 1970’s, two types have evolved. Construction Management/Constructor (also called “At
        Risk”) and Construction Management/Advisor (“No Risk’). For Agency funding purposes, it is preferred that Construction
        Management/Constructor be used rather than Construction Management/Advisor.

REMOVE                                 INSERT
Pages 17 (Rev 1),                      Pages 17 (Rev 2),
87 & 88 (Rev 1) 89 & 90 (Rev 1),       87 & 88 (Rev 2), 89 & 90 (Rev 2),
107 & 108 (Rev 4),                     90A & 90B added, 107 & 108 (Rev 5),
Guide 27, Attachments 1, 3, 4, 5.      Guides 27, Attachments 1, 3, 4, 5, and

Attachments 6 & 7 added 09-24-12.

INSERT RD INS 1951-O
(WSAL)

SERVICING CASES WHERE UNAUTHORIZED LOAN(S) OR OTHER FINANCIAL ASSISTANCE WAS RECEIVED -– COMMUNITY AND INSURED BUSINESS PROGRAMS. Exhibit B is partially revised to update program interest rates, effective July 1, 2012.

REMOVE                                 INSERT
Exhibit B: Pages 3 & 4 (Rev 18).     Exhibit B: Pages 3 & 4 (Rev 19).

INSERT RD INS 1980-D                    Rural Housing Loans. This Instruction is
(WSAL)                                partially revised as follows:

The Table of Contents is revised to change the title for section 1980.323 from “Guarantee Fee” to “Guarantee loan fees.”

Section 1980.302, to add the definition of “Annual Fee.”

Section 1980.310(c), to clarify that the cost of establishing an escrow account for collection of the annual fee is an eligible loan purpose.

Section 1980.323, to clarify that the Agency will charge both and up-front and annual fee in exchange for a Loan Note Guarantee.

Section 1980.345(c)(1), to clarify that the monthly annual fee amount must be included when calculating repayment ratios for the proposed loan.

REMOVE                                INSERT
Table of Contents: All Pages;        Table of Contents revised;
Pages 1 & 2, 16 added,                Pages 1 & 2 (Rev 1), 16A (Rev 1),
27 & 28 and 33 & 34.                  27 & 28 (Rev 1), 28A added 09-24-12 and
                                      33 & 34 (Rev 1).

RD HANDBOOK CHANGES

INSERT RD HB-1-3550
(WSAL)

DIRECT SINGLE FAMILY HOUSING LOANS AND GRANTS FIELD OFFICE HANDBOOK. In the following Handbooks, Appendix 6 is partially revised to include the July 1, 2012, interest rate for the Above-Moderate Single Family Housing non-programs.

* Number       Title
HB-1-3550      DIRECT SINGLE FAMILY HOUSING LOANS AND GRANTS FIELD OFFICE
               HANDBOOK.

HB-2-3550      DIRECT SINGLE FAMILY HOUSING LOANS AND GRANTS CENTRALIZED
               SERVICING CENTER HANDBOOK.

REMOVE                                INSERT
Appendix 6: Pages 3 & 4.             Appendix 6: Pages 3 & 4 revised 09-24-12.

INSERT RD HB-2-3550
(WSAL)

DIRECT SINGLE FAMILY HOUSING LOANS AND GRANTS CENTRALIZED SERVICING CENTER HANDBOOK. This Handbook is partially revised. Specific revisions include:

Chapter 2:

To include changes to Attachment 2-B which correspond with changes to Attachment 2-A that clarified requirements for triggering or calculating recapture of subsidy; and

Attachment 2-B, to correspond with changes to Attachment 2-A.

REMOVE                                INSERT
Chapter 2 dated 05-27-98:             Chapter 2 dated 05-27-98:
Attachment 2-B: Pages 1 thru 4.    Attachment 2-B:

Pages 1 thru 4 revised 09-24-12.

RD HANDBOOK CHANGES

INSERT RD HB-2-3560
(WSAL)

MFH ASSET MANAGEMENT HANDBOOK. This Handbook is partially revised. Specific revisions include:

Chapter 3:

Attachment 3-F is revised to reflect the Fiscal Year 2013 Management Fee. There is no increase in the per unit per month fee for Fiscal Year 2013. These fees will be used for the Fiscal Year 2013 budget cycle beginning January 1, 2013.

REMOVE                                INSERT
Chapter 3 dated 02-24-05:             Chapter 3 dated 02-24-05:
Attachment 3-F: Pages 1 & 2.       Attachment 3-F:

Pages 1 & 2 revised 09-24-12.

INSERT RD HB-3-3560
(WSAL)

MFH PROJECT SERVICE HANDBOOK. This Handbook is partially revised. Specific revisions include:

Chapter 7:

As the guidance and the terminology is inconsistent with the appraisal guidance found in 7 CFR Part 3560 and HB-1-3560, Chapter 7, Attachment 7-C. This change will consolidate all appraisal guidance in HB-1-3560 while removing confusion and misinterpretation of the values required when processing a Transfer of Ownership.

Attachment 7-B-1, is revised due to the Appraisal Guidance to be consistent with Chapter 7, Attachment 7-C of HB-3-3560.

Attachment 7-E has been renumbered to Attachment 7-D.

REMOVE                                INSERT
Table of Contents: Pages 9 & 10;     Table of Contents: Pages 9 & 10 revised;
Chapter 7 dated 02-24-05:             Chapter 7 dated 02-24-05:
Attachment 7-B-1:                    Attachment 7-B-1:
    Pages 1 thru 11;                      Pages 1 thru 11 revised,
Attachment 7-D: Pages 1 & 2;       Attachment 7-D:
Attachment 7-E.                         Pages 1 & 2 revised 09-24-12.

NO SPECIAL PROCEDURE NOTICES RELEASED:

ADMINISTRATIVE NOTICES RELEASED:

(See AN Checklist.)

oOo