UNNUMBERED LETTERS ISSUED FOR THE MARCH OF 2014 Dated Subject Distribution 03-11-14 Required Posters for Field Offices S/D 03-12-14 Rural Area Designation Changes Guidance for

Changing Eligible Area Maps and Implementation Timeframes Rural Housing Service Loans

S/D

03-20-14 Rural Economic Development Loan and Grant

Program Projects Funded for January - February, Fiscal Year 2014

S/D

03-20-14 Interest Rate Changes for Business and Industry

Loans S/D

03-20-14 Interest Rate Changes for Community Facilities

Programs S/D

03-20-14 Interest Rate Changes for Community Facilities

Programs S/D

03-24-14 Interest Rate Changes for Water and Waste Loans S/D 03-25-14 Credit Report and Credit Worthiness Issues Single

Family Housing Direct Loan Program S/D

03-26-14 Section 515 Active Borrower Case Files S/D 03-26-14 Section 9007, Rural Energy for America Program

Technical Review Guidance for Fiscal Year 2014 S/D

March 11, 2014 TO: Agency Administrators State Directors ATTN: National Office Officials Administrative Program Directors Management Control Officers Civil Rights Managers/Coordinators Outreach Coordinators FROM: Edna Primrose (Signed by Edna Primrose) Deputy Administrator SUBJECT: Required Posters for Field Offices Each agency has the responsibility to keep employees informed of their rights, any new programs, their safety, non-discrimination laws, and more. Posters hung in the office place are one way of doing this---and many of them are required. The attached list details which posters are required for field offices. The list is provided as a reminder and for your reference, use, and information. This updated list is intended to assist states in ensuring they are monitoring and meeting poster requirements and in conducting reviews of State, Area, Sub-Area, and Satellite Offices. The attached list indicates the title of the poster, the item number, where it is referenced in regulations or Rural Development Instructions, if the reference makes a specific or general requirement for the poster, where copies may be obtained, and whether it is for public or in-house display. Posters with no item number indicated may be obtained directly from the National Office contact. It is suggested that State Management Control Officers (MCOs), in coordination with the State Civil Rights Managers or Coordinators, conduct an inventory of the field offices, compile a comprehensive list of needed posters, and submit one complete order for the entire State. The "Equal Housing Opportunity," "And Justice for All," and "Equal Employment Opportunity is THE LAW," posters are mentioned specifically by name in several of Rural Development regulations as indicated in the attached list. EXPIRATION DATE: FILING INSTRUCTIONS: March 31, 2015 Administrative/Other Programs

The National Appeals Division (NAD) has developed a poster (AD 1192 [English version]) and (AD 1192S [Spanish version]), entitled "Face to Face Fairness." Both versions of the poster were distributed to all field offices. Note: The previous poster, entitled "You Have the Right to Appeal," is obsolete and should no longer be displayed. NAD has also developed a brochure (AD 1191 [English version]) and (AD 1191S [Spanish version]), entitled "Face to Face Fairness," to replace the pamphlet, entitled "If you Disagree ...." Both versions of the brochure were distributed to all field offices and should be distributed for informational purposes to ensure customers know about their appeal rights. The brochures do not replace the agency’s requirements to issue adverse action letters. There is no regulation that specifically mentions the poster or brochure; however, Public Law 103-354, Department of Agriculture Reorganization Act of 1994, requires all agencies to inform customers of their appeal rights within 10 days of the date an adverse decision is rendered. It is our intent to provide annual updates of the list for your use and information. If you have any questions or need additional information, please contact John Dunsmuir, Acting Director, Financial Management Division (FMD), at (202) 692-0080 or john.dunsmuir@wdc.usda.gov. Attachment Sent by Electronic Mail on March 18, 2014 , at 10:00 a.m. by FMD. Agency Administrators and State Directors should advise other personnel as appropriate.

Required Posters for Field Offices Financial Management Division (FMD)

March 2014

TITLE ITEM # REFERENCE REQUIREMENT/AVAILABILITY Equal Housing Opportunity (Fair Housing Poster)

HUD 928.1 (Rev. 8/11) (English), HUD 928.1A (2/03) (Spanish)

1901-E, §§ 1901.203(c)(3)(iv) and 1901.205(e)(1)(i); HB-1-3560, Ch. 8 (Pgs. 8-12 & 8-13), 8.11 A; App. 1 (Pg. 72), § 3560.103(a)(3)(xiv) and (Pg. 76), § 3560.104(b)(4)(ii)(A)(2); and App. 4 (HB Letter 102); HB-2-3560, Ch. 6 (Pg. 6-47), 6.36 and App. 1 (Pg. 72), § 3560.103(a)(3)(xiv) and (Pg. 76), § 3560.104(b)(4)(ii)(A)(2); HB-3-3560, App. 1 (Pg. 72), § 3560.103(a)(3)(xiv) and (Pg. 76), § 3560.104(b)(4)(ii)(A)(2); HB-1-3565, Ch. 8 (Pg. 8-12), 8.15

Mentioned specifically and generally/ Rural Development Warehouse or HUD-ONLINE (ENGLISH) http://portal.hud.gov/hudportal/documents/huddoc?id=928.1.pdf (SPANISH) http://portal.hud.gov/hudportal/documents/huddoc?id=DOC_20724.pdf (PUBLIC)

And Justice For All AD-475-A (Rev. 9/06) AD-475-C (Rev. 9/06) (for loan/grant recipients)

1901-E, §§ 1901.202(f) and 1901.205(e)(1)(i); HB-1-3560, Ch. 8 (Pgs. 8-12 & 8-13) ), 8.11 A; App. 1 (Pg. 72), § 3560.103(a)(3)(xiv); App. 4 (HB Letter 102); HB-2-3560, Ch. 6 (Pg. 6-47), 6.36; App. 1 (Pg. 72), § 3560.103(a)(3)(xiv); HB-3-3560, App. 1 (Pg. 72), § 3560.103(a)(3)(xiv)

Mentioned specifically and generally/ Rural Development Warehouse (PUBLIC)

USDA Hotline Item 434 5 USC 2301(b)(9) Mentioned generally/ Rural Development Warehouse or National Office - FMD, Contact Demetries (Dee) Moore (202) 692-0087 (PUBLIC)

Equal Employment Opportunity is THE LAW

Item 620 (English), EEOC-P/E-1 (Rev. 11/09) ONLY ON-LINE (Spanish) (Rev. 11/09)

1901-E, § 1901.205(b)(3)(i)(A) and (e)(1)(i); 1980-D, § 1980.317(c)(2)(iii) and (c)(5); 2045-X, § 2045.1153(b)(8) HB-1-3550, Ch. 5 (Pg. 5-38), 5.25 B HB-1-3560, App. 4 (HB Letter 102)

Mentioned specifically and generally/ Rural Development Warehouse or DOL-ONLINE (ENGLISH) http://www.dol.gov/ofccp/regs/compliance/posters/pdf/eeopost.pdf (SPANISH) http://www.dol.gov/ofccp/regs/compliance/posters/pdf/eeosp.pdf (PUBLIC)

EMPLOYEE RIGHTS Under the DAVIS-BACON ACT for Laborers and Mechanics Employed on Federal or Federally Assisted Construction Projects

WH-1321 (Rev. 4/09) (English), ONLY ON-LINE WH-1321 SPA (Rev. 4/09) (Spanish)

1940-C, § 1940.106(d)(5) and Exh. A (Pg. 1), a(1)(i) Mentioned specifically/ Rural Development Warehouse or DOL-ONLINE (ENGLISH) http://www.dol.gov/whd/regs/compliance/posters/fedprojc.pdf (SPANISH) http://www.dol.gov/whd/regs/compliance/posters/davispan.pdf (PUBLIC)

EEO Counseling Program Item 431 2045-X, § 2045.1153(b)(8); 29 CFR 1614

Mentioned generally/ Rural Development Warehouse (IN-HOUSE)

Sexual Harassment is Illegal! AD-1085 (Rev. 9/03)

29 CFR 1604.11 Mentioned generally/ Rural Development Warehouse (IN-HOUSE)

USDA Occupational Safety and Health

AD-1010 2069-A, § 2069.8(d)(10)(i);29 CFR 1900-1990

Mentioned generally/ Rural Development Warehouse (IN-HOUSE)

Required Posters for Field Offices Financial Management Division (FMD)

March 2013 Page 2

TITLE ITEM # REFERENCE REQUIREMENT/AVAILABILITY

Work Place Violence AD-1135A (Rev. 3/99)

DR 4200-001 Mentioned generally/ Rural Development Warehouse (IN-HOUSE)

EAP Serves You (Flyer)

None 5 USC 7901(a); 2063-F, §§ 2063.255(b), (e)(1), and (f)(2) and 2063.261

Mentioned generally/ EAP - ONLINE http://www.sandcreekeap.com/files/sandcreek/files/Sand%20Creek%20Brochure.pdf National Office - HR, Antoinette Hendrick, (202) 692-0168 (IN-HOUSE)

National Appeals Division Face to Face Fairness (Brochure)

AD-1191 (4/05) (English), AD-1191S (Spanish)

1900-B;HB-1-3565, Ch. 8 (Pg. 8-12), 8.15; 7 CFR 11

Mentioned generally/ Rural Development Warehouse (PUBLIC)

National Appeals Division Face to Face Fairness

AD-1192 (4/05) (English), AD-1192S (11/05) (Spanish)

1900-B;HB-1-3565, Ch. 8 (Pg. 8-12), 8.15; 7 CFR 11

Mentioned generally/ Rural Development Warehouse (PUBLIC)

Ask for a Receipt for Service It's Your Right

None ONLY ON-LINE (English) and (Spanish), March 2012

DR 4370-002, 6b Mentioned generally/ USDA-ONLINE http://www.outreach.usda.gov/rfs.htm (PUBLIC)

March 12, 2014 TO: State Directors Rural Development ATTN: Program Directors Single Family Housing Multi-Family Housing FROM: Tony Hernandez (Signed by Tony Hernandez)

Administrator Housing and Community Facilities Programs

SUBJECT: Rural Area Designation Changes Guidance for Changing Eligible Area Maps and Implementation Timeframes Rural Housing Service Loans BACKGROUND/PURPOSE: With the passing of the Agriculture Act of 2014 (Farm Bill), the rural area definition in the Housing Act of 1949 has changed. The changes expand the rural area definition and the grandfather clause, but do not affect the grandfathering of areas that were eligible prior to October 1, 1990. These changes do not align perfectly with the language of the Consolidated Appropriations Act, 2014, which prohibits the reclassification of any areas as ineligible in Fiscal Year (FY) 2014. To accommodate these differences, the changing of the ineligible area maps will require a 2-phase implementation approach. States will be able to identify and modify the map changes for both phases at one time without having to perform two separate reviews. EXPIRATION DATE: FILING INSTRUCTIONS: October 31, 2014 Housing Programs

Details of the 2-phase implementation approach are as follows:

Phase 1—Proposed implementation: May 6, 2014 a. Any area eligible as of September 30, 2013 will remain eligible for the remainder

of Fiscal Year 2014. b. Any area where the population decreased, is no longer in a Metropolitan

Statistical Area (MSA), or is now considered eligible under the new rural area definition, may be made eligible.

c. Any area that was eligible prior to October 1, 1990, or was deemed eligible at any time between January 1, 2000 and December 31, 2010, but subsequently became ineligible and was ineligible on September 30, 2013, may be made eligible providing the area’s population does not exceed 35,000 and the area is rural in character.

d. No areas are to be changed to ineligible in Phase 1.

Phase 2—Implementation: October 1, 2014 Any area that no longer meets the new rural area definition becomes ineligible. This includes: a) All grandfathered areas where the population exceeds 35,000; b) Any area that is annexed into a larger town, city, or place that is ineligible; c) Any area that is no longer rural in character; d) Any town, city, or place where the population has increased and now exceeds

limits imposed by the rural area definition. To ensure timely implementation of the changes to the eligible areas and the eligibility maps, timeframes have been established. It is important that States meet the required deadlines so that publication of the maps can take place as proposed in the Time Line below. The National Office will provide additional follow-up information by:

Issuing an Administrative Notice to define the changes of rural areas, Publishing a change to the Handbook (HB) 1-3550, and Publishing a regulation change to the HB 1-3550, Appendix 1 (7 CFR Part 3550).

PROCEDURAL STEPS: The process for reviewing and modifying the eligible area maps on the eligibility website (http://eligibility.sc.egov.usda.gov) is as follows:

1. State Directors (or designee) are to review the population in the areas within their state using the 2010 census data. The 2010 Census Data should be accessed using the following website: http://factfinder2.census.gov/main.html. (See Locating State Census Data below). States should also review the Rural Area Definition Q&A document available on SharePoint at: https://rd.sc.egov.usda.gov/teamrd/hcfp/sfh/Single%20Family%20Housing%20Information/Forms/Alphabetical%20View.aspx?RootFolder=%2Fteamrd%2Fhcfp%2Fsfh%2FSingle%20Family%20Housing%20Information%2FRural%20Area%20Designation&FolderCTID=0x012000FAEA09B3A193524AA6AAC002EF563C63&View={764C7730-E0E4-4965-AAE7-6907565EE38E}.

2. Changes to the ineligible area layers will be made by States via the RD Geographic Information System (GIS) portal (http://rdgisportal.sc.egov.usda.gov).

a. May 6, 2014 changes are limited to areas that have become eligible. To designate newly “Eligible” areas, you should use the red polygon shape tool entitled “Delete an Ineligible area.” No areas may be changed to “Ineligible” for the May 6th release.

b. October 1, 2014 changes include areas that will be “Ineligible” under the new rural area definition. To designate areas that have become ineligible, you should use the Pink/Fuchsia polygon shape tool entitled “Add an Ineligible area.”

3. If the changes are marked as indicated above, the changes for both the May and October

map updates may be completed during one review. To include collaborative notes for the GIS Developer, you should use the green polygon shape tool. States are responsible for accurately drawing the map changes for their state. You will need to zoom in on the map you are editing to ensure accuracy.

4. The RD GIS Map collaboration instructions are located on SharePoint at the link provided above (see Procedural Step 1). All changes to eligibility areas must be submitted via the RD GIS map collaboration tool.

5. States must maintain a list of areas that will become eligible for the May 6, 2014 release

and areas that will become ineligible for the October 1, 2014 release. The list of areas is to be provided to the National Office. A template for listing the changed areas is located on SharePoint at the link provided above (see Procedural Step 1).

ADDITIONAL INFORMATION: As a reminder, a 30-day public notice is required when an area is changed from rural to non- rural, when completing periodic reviews, and or when making a new area ineligible as a result of the 2010 Census. State Supplements, in accordance with the detailed instructions in Handbook 1-3550, Chapter 5, Attachment 5-E, are to be submitted using HB-1-3550 Attachment D. State Offices with questions concerning State supplements should direct them to Shantelle Gordon at SFHDIRECTPROGRAM@wdc.usda.gov. Questions concerning map changes via the RD GIS Portal should be directed to Dean Daetwyler at Dean.Daetwyler@usda.gov.

Time Line

Locating State Census Data

American Fact Finder: http://factfinder2.census.gov/main.html

Click on “Advanced Search” in the top navigation bar.

Enter GCT-PH1 in the search box and click “Go”.

This is what the results screen will bring back. Proceed to Page 2. Find and click on “Population, Housing Units, Area, and Density 2010 -State -- Place and (in select states) County Subdivision.”

Select your State from the drop down menu. Your State’s data will automatically populate. Once the data populates, click “Download”.

Select your choice of download format for the data (Microsoft Excel is recommended).

March 20, 2014 SUBJECT: Rural Economic Development Loan and Grant Program

Projects Funded for January - February, Fiscal Year 2014

TO: State Directors, Rural Development ATTENTION: Business Programs Directors Business Programs has announced grant selections for January - February funding for fiscal year (FY) 2014, under t)e Rural Economic Development Loan and Grant program. A listing of the grant awards is attached for your information. During the January - February funding cycle of FY 2014, four grants for $1,150,000 were considered by Business Programs. Based on the availability of funds, three applications were selected for funding totaling $850,000. These funds will be leveraged by $945,300 of private and public financing, directly creating three jobs. If you have any questions, please contact Cindy Mason, Business Loan and Grant Analyst at (202) 690-1433, or Melvin Padgett, Business Loan and Grant Analyst at (202) 720-1495, Specialty Programs Division. (Signed by CHAD PARKER) CHAD PARKER Deputy Administrator Business Programs Attachment EXPIRATION DATE: FILING INSTRUCTIONS: September 30, 2014 Community/Business Programs

Attachment

RURAL ECONOMIC DEVELOPMENT LOAN AND GRANT PROGRAM REQUEST FOR GRANT FUNDS – JANUARY - FEBRUARY Funding FY 2014

FY 2014 Allocated Funds to Date $ 2,932,000 Carryover Funds $ 0 Total Available $ 2,932,000 Less October-November Funding $ 2,011,000 Less December Funding $ 0 Less January Funding $ 850,000 Balance Remaining $ 71,000 Grant REDG State Project Amount____Number SD 39 Douglas Electric Cooperative, Inc. $250,000 616 NC 32 Piedmont Electric Membership Corporation $300,000 617 SD 52 Southeastern Electric Cooperative, Inc. $300,000 618 3 Grants Total $850,000 Balance of Grant Funds After Above Request: $ 71,000

March 20, 2014 TO: State Directors ATTN: Area Specialist Business Program Directors FROM: Lillian Salero (signed Lillian Salero) Administrator Rural Business-Cooperative Service SUBJECT: Interest Rate Changes for Business and Industry Loans The following interest rates, effective April 1, 2014, through June 30, 2014. Loan Type Existing Rate New Rate ALL LOAN TYPES Direct Business 3.250% 3.250% and Industry Please notify appropriate personnel of this rate. EXPIRATION DATE: FILING INSTRUCTIONS: June 30, 2014 Administrative/Other Programs

March 20, 2014 TO: State Directors ATTN: Area Directors Area Specialist Community Facilities Program Directors FROM: Tony Hernandez Administrator Housing and Community Facilities Programs SUBJECT: Interest Rate Changes for Community Facilities Programs Effective from April 1, 2014, through June 30, 2014, the interest rates for direct community facility loans are as follows: Poverty Line...unchanged at..............4.500% Intermediate...decreased to................4.250% Market............decreased to................4.125% Please notify appropriate personnel of these rates. EXPIRATION DATE: FILING INSTRUCTIONS: June 30, 2014 Administrative/Other Programs Sent by Electronic Mail 3-20-14 at 5:30 pm by Credit Reform Staff. State Director should advise other personnel as appropriate.

March 20, 2014 TO: State Directors ATTN: Area Directors Area Specialist Community Facilities Program Directors FROM: Tony Hernandez (Signed by Tony Hernandez) Administrator Housing and Community Facilities Programs SUBJECT: Interest Rate Changes for Community Facilities Programs The following interest rates, effective April 1, 2014, are reported as follows: Loan Type Existing Rate New Rate ALL LOAN TYPES Treasury Judgment Rate 0.110% 0.120% The new rate shown above is as of the week ending February 21, 2014. The actual judgment rate that will be used will be the rate for the calendar week preceding the date the defendant becomes liable for interest. This rate may be found by going to the Federal Reserve website for the weekly average 1-year Constant Maturity Treasury Yield*. RURAL HOUSING LOANS Rural Housing (RH) 502

Very-Low or Low 4.000 3.750 Single Family Housing

(SFH) Nonprogram 4.500 4.250 Rural Housing Site

(RH-524), Non-Self-Help 4.000 3.750 Rural Rental Housing and

Rural Cooperative Housing 4.000 3.750 Please notify appropriate personnel of these rates. EXPIRATION DATE: FILING INSTRUCTIONS: April 30, 2014 Administrative/Other Programs

Interest Rate Changes for Housing Program 2 And Credit Sales (Nonprogram) Please notify appropriate personnel of these rates Sent by Electronic Mail 3-20-14 at 5:30 pm by Credit Reform Staff. State Director should advise other personnel as appropriate.

March 24, 2014 TO: State Directors ATTN: Area Directors Area Specialist Utilities Program Directors FROM: John C. Padalino Administrator Rural Utilities Service SUBJECT: Interest Rate Changes for Water and Waste Loans Language in the Consolidated Farm and Rural Development Act requires that the poverty rate and the intermediate rate be determined based on the approval date of the loan. For those loans approved on or after May 23, 2008, the poverty rate will be set at 60 percent of the market rate and the intermediate rate set at 80 percent of the market rate, adjusted to the nearest one-eighth of one percent. Following are the new interest rates for water and waste disposal loans approved on or after May 23, 2008:

Poverty Line….. decreased to...........2.500% Intermediate...... decreased to...........3.250% Market ………... decreased to...........4.125%

For loans approved but not closed on or before May 22, 2008, the poverty rate will remain fixed at 4.500 percent and the intermediate rate will continue to be set at one-half of the difference between the poverty line rate and the market rate. Following are the new interest rates for water and waste disposal loans approved on or before May 22, 2008:

Poverty Line….. unchanged at …....4.500% Intermediate...... decreased to ..........4.250% Market................ decreased to...........4.125%

Due to the inversion of the rates, all loans may be obligated at the lower market rate for this quarter. These rates will be effective from April 1, 2014, through June 30, 2014. EXPIRATION DATE: FILING INSTRUCTIONS: June 30, 2014 Administrative/Other Programs

Interest Rate Changes for Water 2 And Waste Loans Also, the rate for watershed protection and flood prevention loans and resource conservation and development loans is as follows:

CURRENT RATE NEW RATE

4.375% 4.125% Please notify appropriate personnel of these rates Sent by Electronic Mail 3-24-14 at 6:00 pm by Credit Reform Staff. State Director should advise other personnel as appropriate.

March 25, 2014 TO: State Directors Rural Development ATTN: Program Directors Single Family Housing FROM: Tony Hernandez /s/ Toy Hernandez Administrator Housing and Community Facilities Programs SUBJECT: Credit Report and Credit Worthiness Issues Single Family Housing Direct Loan Program The Single Family Housing (SFH) direct loan program requires that applicants have a credit history that indicates an ability and willingness to repay obligations. To analyze an applicant’s credit reputation, field staff must check the applicant against the database of defaulted Federal debtors, pull the applicant’s credit report and obtain supplemental credit documentation from the applicant and third parties (as applicable). As it relates to pulling the applicant’s credit report, the Rural Development (RD) Help Desk has reported numerous incidences where credit report orders have been mishandled by field staff. To resolve these issues, field staff should be reminded of the following ordering protocols:

A credit report (regardless of type) must not be ordered until a signed Form RD 3550-1, “Authorization to Release Information,” has been obtained from the appropriate party.

An infile credit report must only be pulled on a potential applicant who has yet to submit an application; or on an applicant whose application cannot be processed due to a lack of available funds (i.e. they will be placed on the waiting list).

A Residential Mortgage Credit Report (RMCR) must only be pulled on an applicant when funds are available to process their application.

EXPIRATION DATE: FILING INSTRUCTIONS: March 31, 2015 Housing Programs

A RMCR must not be more than 180 days old at the time of the underwriting decision as well as by loan closing. In an ideal situation, the time that elapses between ordering the RMCR to determine applicant eligibility and loan closing is 180 days or less.

Since aging of the RMCR increases the need to order a subsequent RMCR (at the agency’s expense), greater effort must be made to avoid ordering a RMCR too soon.

If the applicant is renting, be sure to enter the landlord’s contact information in the UniFi Landlord Verification screen before ordering the RMCR so that the agency’s credit report vendor, CBCInnovis Inc., can verify the rental payment history.

Before placing an order for a credit report, confirm the accuracy of the relevant information in UniFi (applicant’s name, social security number, etc.) and be sure you are ordering the right type of report. Be diligent since ordering errors cost the agency time and money; and may adversely impact the quality of the credit worthiness review.

Avoid ordering multiples of the same report type on the same person. Both infiles and RMCRs are considered hard inquiries and multiple orders can impact the person’s credit score.

Do not order a subsequent report to verify changes to the original report; obtain supplemental information from the applicant and/or a third party.

Realize that CBCInnovis has a credit data retention period of 120 days. Within this retention period, orders that match a prior order will just return the results of the prior order. A new report will not be generated .

If an ordering error occurs on a RMCR, field staff must contact the RD Help Desk within 24 hours of the order so that the Help Desk can cancel the request with the vendor. The cancellation fee is $16. A cancellation of a RMCR in Unifi does not cancel the request at the vendor.

In the event that an applicant reapplies after having an application denied or withdrawn in the recent past, field staff should contact the RD Help Desk to have the RMCR associated with the denied/withdrawn application removed from CBCInnovis’s retention files prior to ordering a RMCR on the new application.

Field staff must not contact CBCInnovis directly. Technical issues related to the credit report must be directed to the RD Help Desk at 800-457-3642, option 2, and then option 2 again.

In addition to the procedural guidance on credit reports found in Handbook-1-3550, field staff are reminded of the supplemental training materials found in SharePoint using the following paths and are asked to revisit them:

o Single Family Housing > Single Family Housing Information > Direct Program Information > Credit Reports

o Single Family Housing > SFHD Training Hub > National Office Training Material > Borrower_Eligibility > Credit Report – Basics and Analysis

o Single Family Housing > Announcements > SFH Direct Credit Reports: New Delivery of OFAC Data

Once the RMCR is received, questions related to the credit score are often raised. The SFH direct loan program does not use credit scores as an eligibility requirement. When the conditions in Handbook-1-3550, Section 3 are met, a reliable credit score of 640 or higher can be used to internally expedite the credit worthiness determination. To determine a credit score as reliable, the credit report must contain a minimum of three trade lines that have been open and active for at least 12 months. This condition ensures that the applicant has a recent history (preferably within the last 12 months) of consistently and dependably making payments. An example of a trade line that would meet this condition:

A trade line for an installment loan that was opened 18 months ago but was closed 3 months ago. During the 15-month payment history, all payments were made on time.

An example of a trade line that would not meet this condition:

The applicant opened a credit card two years ago and has since made a limited number of sporadic payments.

Again, an unreliable credit score of 640 or higher; or a credit score of less than 640, is not a basis for denial. It means that an in-depth credit worthiness analysis is needed following the relevant regulatory and procedural guidance. For further guidance concerning reliable credit scores, please refer to HB-1-3550, Paragraph 4.12 A. If the RMCR shows a thin credit record (less than three open, active, and recent trade lines) or no credit record, field staff must examine the applicant’s recent use of nontraditional credit following the guidance in Handbook-1-3550, Paragraph 4.12 C. 3. While this paragraph leaves the impression that nontraditional credit must be paid on a monthly payment schedule, other payment schedules are permitted provided the history verified is adjusted accordingly. For example, if the nontraditional credit is paid on a quarterly basis, field staff should look beyond the last four payments to obtain a more complete payment history. A credit history based solely on nontraditional credit verifications reflects a loan risk and should be carefully considered when making a determination (especially when other risks are present). Field staff with technical questions regarding credit reports should call the RD Help Desk at (800) 457-3642, option 2. State staff with policy questions regarding this memorandum should contact the SFH Direct Loan Division at (202) 720-1474. Sent by electronic mail on March 27, 2014 at 3:15 p.m. by Single Family Housing Direct Loan Division. The State Director should advise other personnel as appropriate.

March 26, 2014

TO: State Directors

Rural Development

ATTN: Program Directors

Multi-Family Housing

FROM: Tony Hernandez (Signed by Tony Hernandez)

Administrator

Housing and Community Facilities Programs

SUBJECT: Section 515 Active Borrower Case Files

The purpose of this Unnumbered Letter (UL) is to reiterate the need to create and maintain

active borrower “eight position” case files for all Section 515 active borrowers in accordance

with RD Instruction 2033-A, Section 2033.8. Section 2033.8 provides direction for the

maintenance of active borrower case files.

Multi-Family Housing files are voluminous and must be organized to maximize their utility.

Therefore and in accordance with Section 2033.8, separate eight-position folders will be

created for each of the following file types: Table of Contents [file], Loan File, Construction

File, Current Servicing File, and Monthly Report File.

EXPIRATION DATE FILLING INSTRUCTIONS March 31, 2015 Housing Programs

Page 2

Records are arranged within each file type by using the “position filing” method for the eight

different categories of items or transactions. Divider sheets (blank paper, with or without

tabs) may be used within a filing position to separate specific types of records, or within a

case folder. All documents are filed in the designated position EXCEPT when the volume,

size, or unique subject matter requires separation for better maintenance purposes. In these

circumstances, place a divider sheet in the position where the material would normally be

filed and identify where the material is located.

TABLE OF CONTENTS FILE: The Table of Contents or Processing Checklist loan folder

indicates the location of each document. A processing checklist may be used in lieu of a

Table of Contents provided the location of each document is shown on the checklist. If a

processing checklist is not used, the State Director will issue as a State Form a Table of

Contents to cover all National forms, State forms, and unnumbered items classified to each of

the eight file positions in the borrower case folder(s).

LOAN FILE: A Loan File contains the pre-application, application, closing documents,

assumption documents, consolidation documents, reamortization documents, etc.

POSITION “1” - Processing checklists, security agreements, financing statements, and

lien searches.

POSITION “2” - Loan obligations documents, copies of promissory notes, assumption

agreements, and reamortization requests and agreements, interest credit and Rental

Assistance requests and agreements, supervised bank accounts for other than

construction, check requests and evidence of check receipts, and consolidation forms.

Page 3

POSITION “3” - Pre-application and application information, initial operating budget,

utility allowance, management plan/agreement, and running records up to the

operational stage.

POSITION “4” – Correspondence (which includes but is not limited to emails) up to

the date when the project is operational.

POSITION “5” - Organizational documents and regulations, options, real estate

instrument, loan agreement, title information, mortgage title insurance, closing

instructions and other closing records.

POSITION “6” - Construction information prior to start of construction.

POSITION “7” - Property insurance and position fidelity bonds.

POSITION “8” - Appraisal with all attachments and site information.

CONSTRUCTION FILE: The Construction File contains plans, specifications, bid

documents, copies of contracts, partial pay estimates, supervised bank account information,

cost information, cost certification, and similar construction information.

POSITION “1” - Interim lender letter, deposit agreement and supervised bank account

records.

POSITION “2” - Partial pay estimates and pay requests, construction inspections, cost

certification.

POSITION “3” - Change orders and running records.

Page 4

POSITION “4” - Preconstruction conference report, construction contract, and related

correspondence.

POSITIONS “5-8” - As needed for bid documents and continuation of material in

Positions “1” through “4”.

CURRENT SERVICING FILE: The Current Servicing File contains a copy of loan

agreement and affirmative fair marketing plans, supervisory visit reports, compliance reviews,

and site visits, budgets and utility allowances, annual reports, audits, and annual analyses,

current management plan and management agreement, notice of evictions, correspondence

and running records, problem case reports, and corresponding correspondence.

POSITION “1” - Copy of loan agreement, affirmative fair housing marketing plan,

management plan, management agreement, financial statement, security agreement,

project and pet rules.

POSITION “2” - Copy of promissory notes, assumption agreements, interest credit

agreements, rental assistance agreements, reamortization agreements, consolidation

forms, and conversion to Pre-Amortization Schedule System (PASS) forms.

POSITION “3” - Running records.

POSITION “4” – Correspondence (which includes but is not limited to emails).

POSITION “5” - Annual reports, audits, year-end reports, energy audits, 2 percent

Operation and Maintenance (O&M) return documentation, budget, utility allowance,

rent change documentation.

POSITION “6” - Supervisory visit reports, compliance reviews, and site visit reports.

Page 5

POSITION “7” - Copy of insurance policies.

POSITION “8” - Problem case information.

MONTHLY REPORT FILE: The Monthly Report File contains the Monthly Reports,

Tenant Certifications, Project Worksheets, and correspondence dealing with the monthly

reports.

POSITION “1” - Project worksheets and M2A screens. (Optional, may be

batch retained until disposition.)

POSITION “2” - Tracking logs.

POSITION “3” - Running record.

POSITION “4” - Correspondence (which includes but is not limited to emails)

concerning project worksheets, payments, and tenant certifications.

POSITION “5” - Monthly Reports, letter waiving monthly report, and letter reinstating

monthly reports.

POSITION “6” - Expired Tenant Certifications.

POSITION “7” - Master tenant list.

POSITION "8" - Current Tenant Certifications.

Material from the servicing file may be moved to a continuation folder until eligible for

disposition when no longer applicable to current operations. Guidance for retention of items

is outlined in Section 2033.8.

Page 6

Questions regarding this UL may be directed to Melinda Price of the Multifamily Housing

Preservation and Direct Loan Division at (614) 255-2403 or e-mail

melinda.price@wdc.usda.gov.

March 26, 2014 TO: State Directors, Rural Development ATTN: Business Programs Directors

State Energy Coordinators SUBJECT: Section 9007, Rural Energy for America Program

Technical Review Guidance for Fiscal Year 2014 The purpose of this Unnumbered Letter (UL) is to provide guidance for processing technical reviews for Rural Energy for America Program, Renewable Energy Systems and Energy Efficiency Improvements loan and grant applications for fiscal year (FY) 2014. Loan, grant, and combination applications for projects using the following technologies will be reviewed for technical merit and scored by the State Office. However, the National Renewable Energy Laboratory (NREL) will be available to provide technical reviews on projects where the State determines further technical expertise is needed to complete the technical review or the technology is new with limited data available. Wind (Large and Small) Solar (Large and Small) Biomass (ethanol, biodiesel, and solid fuel production) Biomass boilers which are commercially available and use feedstock(s) that have a proven

history in the boiler, and total project costs less than $200,000 Geothermal (Direct Use) Energy Efficiency projects Grant and combination guaranteed loan and grant applications for projects using the following technologies will be submitted to NREL for technical review and scoring. A complete copy of the application must be forwarded for all NREL reviews. Geothermal Electric Generation Hydrogen Hydro-power, including hydro-electric and ocean energy Biomass technologies not listed above EXPIRATION DATE FILING INSTRUCTIONS March 31, 2015 Community/Business Programs

9007 Technical Review Guidance for FY 2014 2 Grant and combination guaranteed loan and grant anaerobic digester projects will be submitted to the Environmental Protection Agency (EPA) AgSTAR for technical review and scoring. State Offices will also perform the technical review of projects using a hybrid of technologies that are all assigned in this UL for review by the State. If one or more of the technologies require NREL review, NREL will review the technical reports. Fillable excel documents for FY 2014 technical reviews have been posted to SharePoint. The total technical review score must be entered into the Guaranteed Loan System. Further, cover memorandums with contact information for submitting technical reviews to NREL or EPA are attached. These memorandums are also posted on SharePoint. To access the technical review templates and cover memorandums on SharePoint: 1. Go to the Energy Division SharePoint site, Shared Documents, located at:

https://rd.sc.egov.usda.gov/teamrd/BP/energy/Shared%20Documents/Forms/AllItems.aspx

2. Access the “9007” folder. 3. Access the “Resources for States” folder. 4. Technical review templates and cover memorandums are posted in the “Technical

Resources” folder. If you have questions, please contact Fred Petok, Energy Division at (202) 690-0784. (Signed by LILLIAN E. SALERNO) LILLIAN E. SALERNO Administrator Rural Business-Cooperative Service Attachments Exhibit A – NREL Cover Memo for Submitting Technical Reviews Exhibit B – EPA AgSTAR Cover Memo for Submitting Technical Reviews

Exhibit A NREL Cover Memo for Submitting Technical Reviews

Rural Energy for America Program Section 9007

Renewable Energy Systems and Energy Efficiency Improvements

NREL Technical Review TO: National Renewable Energy Laboratory

Attn: Misty Conrad, RSF/401 15013 Denver West Parkway Golden, CO 80401-3305 (303) 384-7467 Misty.Conrad@nrel.gov

FROM: ADDRESS: E-MAIL: PHONE #: APPLICANT: TECHNOLOGY: FINANCE TYPE: COMMENTS:

Exhibit B

EPA AgSTAR Cover Memo for Submitting Technical Reviews Page 1

Rural Energy for America Program Section 9007

Renewable Energy Systems and Energy Efficiency Improvements

EPA AgSTAR Technical Review TO: Kurt Roos

Team Leader, Agricultural Methane Programs U.S. EPA 1200 Pennsylvania, Ave., NW Mail Stop 6202-J Washington, DC 20460 202 343-9041 Please contact Kurt via e-mail rather than phone. roos.kurt@epa.gov

FROM: ADDRESS: E-MAIL: PHONE #: APPLICANT: TECHNOLOGY: FINANCE TYPE: COMMENTS:  

Exhibit B

EPA AgSTAR Cover Memo for Submitting Technical Reviews Page 2

For technical reviews submitted to EPA AgSTAR, please forward the following information: (1) Technical report (2) Feasibility Study (3) Farm description, including animal population, waste handling, collection, and

management (4) Ensure the above documents include:

Timelines Energy production estimates GHG gas credits Utility rate and interconnection agreements Other wastes and delivery agreements that may be part of the project Projected project economics from all waste sources Project costs, financing arrangements, and requested amount from USDA Project developer(s) and relevant experience Equipment providers Guarantees and warranties Regulatory compliance and permitting Operator training and post start-up support Operating plan for the system, such as farm owner, third party, or other operating

arrangements Project closing process