12 U.S.C. § 1702 — Administrative provisions

Page 517 TITLE 12—BANKS AND BANKING § 1702 Editorial Notes REFERENCES IN TEXT The National Housing Act, referred to in subsecs. (a)(2)(A), (D), (3)(A), (4)(C), and (c)(1), is act June 27, 1934, ch. 847, 48 Stat. 1246. Title II of the Act is classi- fied generally to subchapter II (§ 1707 et seq.) of this chapter. For complete classification of this Act to the Code, see section 1701 of this title and Tables. CODIFICATION Section was enacted as part of the Energy Policy Act of 1992, and not as part of the National Housing Act which comprises this chapter. Section was formerly classified as a note under sec- tion 12712 of Title 42, The Public Health and Welfare. AMENDMENTS 2008—Subsec. (a)(2)(C). Pub. L. 110–289, § 2123(1), amended subpar. (C) generally. Prior to amendment, text read as follows: ‘‘The cost of cost-effective energy efficiency improvements shall not exceed the greater of— ‘‘(i) 5 percent of the property value (not to exceed $8,000); or ‘‘(ii) $4,000.’’ Subsec. (a)(2)(D). Pub. L. 110–289, § 2123(2), added sub- par. (D). Statutory Notes and Related Subsidiaries SIMILAR PROVISIONS Similar provisions were contained in Pub. L. 102–550, title V, § 513, Oct. 28, 1992, 106 Stat. 3786. § 1701z–17. Increasing access and understanding of energy efficient mortgages (a) Definition As used in this section, the term ‘‘energy effi- cient mortgage’’ has the same meaning as given that term in paragraph (24) of section 12704 of title 42. (b) Recommendations to eliminate barriers to use of energy efficient mortgages (1) In general Not later than 180 days after July 30, 2008, the Secretary of Housing and Urban Develop- ment, in conjunction with the Secretary of Energy and the Administrator of the Environ- mental Protection Agency, shall consult with the residential mortgage industry and States to develop recommendations to eliminate the barriers that exist to increasing the avail- ability, use, and purchase of energy efficient mortgages, including such barriers as— (A) the lack of reliable and accessible in- formation on such mortgages, including esti- mated energy savings and other benefits of energy efficient housing; (B) the confusion regarding underwriting requirements and differences among various energy efficient mortgage programs; (C) the complex and time consuming proc- ess of securing such mortgages; (D) the lack of publicly available research on the default risk of such mortgages; and (E) the availability of certified or accred- ited home energy rating services. (2) Report to Congress The Secretary of Housing and Urban Devel- opment shall submit a report to Congress that— (A) summarizes the recommendations de- veloped under paragraph (1); and (B) includes any recommendations for statutory, regulatory, or administrative changes that the Secretary deems necessary to institute such recommendations. (c) Energy efficient mortgages outreach cam- paign (1) In general The Secretary of Housing and Urban Devel- opment, in consultation and coordination with the Secretary of Energy, the Administrator of the Environmental Protection Agency, and State Energy and Housing Finance Directors, shall carry out an education and outreach campaign to inform and educate consumers, home builders, residential lenders, and other real estate professionals on the availability, benefits, and advantages of— (A) improved energy efficiency in housing; and (B) energy efficient mortgages. (2) Authorization of appropriations There are authorized to be appropriated such sums as are necessary to carry out the edu- cation and outreach campaign described under paragraph (1). (Pub. L. 110–289, div. B, title IX, § 2902, July 30, 2008, 122 Stat. 2876.) Editorial Notes CODIFICATION Section was enacted as part of the Foreclosure Pre- vention Act of 2008, and also as part of the Housing and Economic Recovery Act of 2008, and not as part of the National Housing Act which comprises this chapter. SUBCHAPTER I—HOUSING RENOVATION AND MODERNIZATION § 1702. Administrative provisions The powers conferred by this chapter shall be exercised by the Secretary of Housing and Urban Development (hereinafter referred to as the ‘‘Secretary’’). In order to carry out the provi- sions of this subchapter and subchapters II, III, V, VI, VII, VIII, IX–B, and X, the Secretary may establish such agencies, accept and utilize such voluntary and uncompensated services, utilize such Federal officers and employees, and, with the consent of the State, such State and local officers and employees, and appoint such other officers and employees as he may find necessary, and may prescribe their authorities, duties, re- sponsibilities, and tenure and fix their com- pensation. The Secretary may delegate any of the functions and powers conferred upon him under this subchapter and subchapters II, III, V, VI, VII, VIII, IX–B, and X to such officers, agents, and employees as he may designate or appoint, and may make such expenditures (in- cluding expenditures for personal services and rent at the seat of government and elsewhere, for law books and books of reference, and for paper, printing, and binding) as are necessary to carry out the provisions of this subchapter and subchapters II, III, V, VI, VII, VIII, IX–B, and X, without regard to any other provisions of law Page 518 TITLE 12—BANKS AND BANKING § 1702 governing the expenditure of public funds. All such compensation, expenses, and allowances shall be paid out of funds made available by this chapter: Provided, That notwithstanding any other provisions of law except provisions of law hereafter enacted expressly in limitation hereof, all expenses of the Department of Housing and Urban Development in connection with the ex- amination and insurance of loans or invest- ments under any subchapter of this chapter all properly capitalized expenditures, and other necessary expenses not attributable to general overhead in accordance with generally accepted accounting principles shall be considered non- administrative and payable from funds made available by this chapter, except that, unless made pursuant to specific authorization by the Congress therefor, expenditures made in any fis- cal year pursuant to this proviso, other than the payment of insurance claims and other than ex- penditures (including services on a contract or fee basis, but not including other personal serv- ices) in connection with the acquisition, protec- tion, completion, operation, maintenance, im- provement, or disposition of real or personal property of the Department acquired under au- thority of this chapter, shall not exceed 35 per centum of the income received by the Depart- ment of Housing and Urban Development from premiums and fees during the preceding fiscal year. Except with respect to subchapter III, for the purposes of this section, the term ‘‘non- administrative’’ shall not include contract ex- penses that are not capitalized or routinely de- ducted from the proceeds of sales, and such ex- penses shall not be payable from funds made available by this chapter. The Secretary shall, in carrying out the provisions of this subchapter and subchapters II, III, V, VI, VII, VIII, IX–B, and X, be authorized, in his official capacity, to sue and be sued in any court of competent juris- diction, State or Federal. (June 27, 1934, ch. 847, title I, § 1, 48 Stat. 1246; Aug. 23, 1935, ch. 614, title III, § 344(a), 49 Stat. 722; Mar. 28, 1941, ch. 31, § 2, 55 Stat. 61; June 28, 1941, ch. 261, § 6, 55 Stat. 365; Aug. 10, 1948, ch. 832, title IV, § 402, 62 Stat. 1283; Aug. 8, 1949, ch. 403, § 2, 63 Stat. 576; Oct. 25, 1949, ch. 729, § 2, 63 Stat. 905; Apr. 20, 1950, ch. 94, title I, § 122, 64 Stat. 59; Sept. 1, 1951, ch. 378, title II, § 202, 65 Stat. 303; Pub. L. 89–117, title XI, § 1108(bb), Aug. 10, 1965, 79 Stat. 507; Pub. L. 89–754, title X, § 1020(g), Nov. 3, 1966, 80 Stat. 1296; Pub. L. 90–19, § 1(a)(1), (3), (c), May 25, 1967, 81 Stat. 17, 18; Pub. L. 98–479, title II, § 202(a)(1), Oct. 17, 1984, 98 Stat. 2228; Pub. L. 100–242, title IV, § 429(a), Feb. 5, 1988, 101 Stat. 1918; Pub. L. 101–235, title I, § 133(d)(1), Dec. 15, 1989, 103 Stat. 2027; Pub. L. 106–74, title II, § 212, Oct. 20, 1999, 113 Stat. 1073.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in text, was in the original ‘‘this Act’’, meaning act June 27, 1934, ch. 847, 48 Stat. 1246, which is classified principally to this chapter (§ 1701 et seq.). For complete classification of this Act to the Code, see Tables. AMENDMENTS 1999—Pub. L. 106–74 inserted before last sentence ‘‘Ex- cept with respect to subchapter III, for the purposes of this section, the term ‘‘nonadministrative’’ shall not include contract expenses that are not capitalized or routinely deducted from the proceeds of sales, and such expenses shall not be payable from funds made avail- able by this chapter.’’ 1989—Pub. L. 101–235 struck out ‘‘IX–A,’’ after ‘‘VIII,’’ wherever appearing. 1988—Pub. L. 100–242 struck out comma before period at end of second sentence. 1984—Pub. L. 98–479 struck out ‘‘without regard to the provisions of other laws applicable to the employment or compensation of other officers or employees of the United States’’ at end of second sentence. 1967—Pub. L. 90–19 substituted ‘‘Department of Hous- ing and Urban Development’’ and ‘‘Secretary’’ for ‘‘Federal Housing Administration’’ and ‘‘Commis- sioner’’, respectively, wherever appearing, substituted provision for exercise of national housing powers by the Secretary of Housing and Urban Development for former authorization for creation of a Federal Housing Administration under a Federal Housing Commissioner appointed by the President with the consent of the Sen- ate, and substituted ‘‘Department’’ for ‘‘Administra- tion’’ in penultimate sentence. 1966—Pub. L. 89–754 inserted references to subchapter IX–B. 1965—Pub. L. 89–117 inserted references to subchapters V and IX–A. 1951—Act Sept. 1, 1951, inserted references to sub- chapter X. 1950—Act Apr. 20, 1950, made technical amendments to section to reflect change in title of Administrator to Commissioner and to omit provisions relating to tenure and compensation of Commissioner. 1949—Joint Res. Oct. 25, 1949, inserted proviso at end of fourth sentence. Act Aug. 8, 1949, made provisions applicable to sub- chapter VIII. 1948—Act Aug. 10, 1948, substituted ‘‘subchapters II, III, VI, and VII’’ for ‘‘subchapters II, III, and VI’’. 1941—Act June 28, 1941, substituted ‘‘$12,000’’ for ‘‘$10,000’’. Act Mar. 28, 1941, substituted ‘‘subchapters II, III, and VI’’ for ‘‘subchapters II and III’’. 1935—Act Aug. 23, 1935, inserted sentence at end. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1941 AMENDMENT Amendment by act June 28, 1941, effective July 1, 1941, see section 6 of act June 28, 1941. REPEALS Act Aug. 10, 1948, ch. 832, title V, § 501(a), 62 Stat. 1283, formerly cited as a credit to this section, was repealed by Pub. L. 89–554, § 8(a), Sept. 6, 1966, 80 Stat. 655. TRANSFER OF FUNCTIONS Functions, powers, and duties of Federal Housing Ad- ministration and Housing and Home Finance Agency transferred to Secretary of Housing and Urban Develop- ment who was authorized to delegate such functions, powers, and duties to such officers and employees of Department of Housing and Urban Development as Sec- retary may designate, see sections 3534 and 3535 of Title 42, The Public Health and Welfare. Executive Documents TRANSFER OF FUNCTIONS Reorg. Plan No. 3 of 1947, eff. July 27, 1947, 12 F.R. 4981, 61 Stat. 954, set out in the Appendix to Title 5, Government Organization and Employees, abolished of- fice of Federal Housing Administrator and transferred functions to Federal Housing Commissioner. It also consolidated Federal Housing Administration with other agencies into Housing and Home Finance Agency and transferred functions of Federal Loan Adminis- Page 519 TITLE 12—BANKS AND BANKING § 1703 trator with respect to Federal Housing Administration and its functions to Housing and Home Finance Admin- istrator. Federal Housing Administration continued as a constituent agency within Housing and Home Fi- nance Agency. For provisions concerning appointment and compensation of Federal Housing Commissioner, see section 3 of Reorganization Plan. Functions, powers, and duties of National Housing Agency with respect to property, funds, and other as- sets which were formerly under administration of Farm Security Administration and were transferred to Na- tional Housing Agency by Ex. Ord. No. 9070, Feb. 24, 1942, 7 F.R. 1529, as amended, were abolished by section 2(a)(3) of act Aug. 14, 1946, ch. 964, 60 Stat. 1063, as amended, set out as a note under sections 1001 to 1005d of Title 7, Agriculture, except with respect of housing projects and such other properties and assets in process of liquidation. Federal Housing Administration consolidated with other agencies into National Housing Agency during World War II, see Ex. Ord. No. 9070. Functions of National Housing Agency with respect to non-farm-housing projects and other properties re- maining under its jurisdiction pursuant to section 2(a)(3) of act Aug. 14, 1946, transferred to Public Hous- ing Commissioner by Reorg. Plan No. 3 of 1947, § 4(b), eff. July 27, 1947, 12 F.R. 4983, 61 Stat. 955, set out in the Appendix to Title 5. Federal Housing Administration to be administered by Federal Loan Administrator within Federal Loan Agency, see Reorg. Plan No. I of 1939, § 402, eff. July 1, 1939, 4 F.R. 2730, 53 Stat. 1429 set out in the Appendix to Title 5. EXECUTIVE ORDER NO. 7058 Ex. Ord. No. 7058, May 29, 1935, authorized Federal Housing Administrator to adopt a seal for Federal Housing Administration, provided that copies of any books, records, papers, documents, agreements, orders, rules, or regulations of Administration were admissible in evidence equally with originals thereof, and empow- ered Administrator or his designee to certify or exem- plify copies of any books, records, papers, or documents of Administration. EXECUTIVE ORDER NO. 7280 Ex. Ord. No. 7280, Jan. 28, 1936, was issued as evidence of creation of Federal Housing Administration and validated and confirmed creation thereof. § 1702a. Repealed. June 28, 1955, ch. 189, § 12(c)(14), 69 Stat. 182 Section, act June 27, 1934, ch. 847, title II, § 228, as added Aug. 2, 1954, ch. 649, title I, § 126, 68 Stat. 809, au- thorized Commissioner to establish one position in GS–18, four in GS–17, and eight in GS–16 in Federal Housing Administration. § 1703. Insurance of financial institutions (a) Authority to insure financial institutions The Secretary is authorized and empowered upon such terms and conditions as he may pre- scribe, to insure banks, trust companies, per- sonal finance companies, mortgage companies, building and loan associations, installment lend- ing companies and other such financial institu- tions, which the Secretary finds to be qualified by experience or facilities and approves as eligi- ble for credit insurance, against losses which they may sustain as a result of loans and ad- vances of credit, and purchases of obligations representing loans and advances of credit, made by them for the purpose of (i) financing alter- ations, repairs, and improvements upon or in connection with existing structures or manufac- tured homes, and the building of new structures, upon urban, suburban, or rural real property (in- cluding the restoration, rehabilitation, rebuild- ing, and replacement of such improvements which have been damaged or destroyed by earth- quake, conflagration, tornado, hurricane, cy- clone, flood, or other catastrophe), by the own- ers thereof or by lessees of such real property under a lease expiring not less than six months after the maturity of the loan or advance of credit; and for the purpose of (ii) financing the purchase of a manufactured home to be used by the owner as his principal residence or financing the purchase of a lot on which to place such home and paying expenses reasonably necessary for the appropriate preparation of such lot, in- cluding the installation of utility connections, sanitary facilities, and paving, and the construc- tion of a suitable pad, or financing only the ac- quisition of such a lot either with or without such preparation by an owner of a manufactured home; and for the purpose of financing the pres- ervation of historic structures, and, as used in this section, the term ‘‘historic structures’’ means residential structures which are reg- istered in the National Register of Historic Places or which are certified by the Secretary of the Interior to conform to National Register cri- teria; and the term ‘‘preservation’’ means res- toration or rehabilitation undertaken for such purposes as are approved by the Secretary in regulations issued by him, after consulting with the Secretary of the Interior. Other than in con- nection with a manufactured home or a lot on which to place such a home (or both), in no case shall the insurance granted by the Secretary under this section to any such financial institu- tion on loans, advances of credit, and purchases made by such financial institution for such pur- poses exceed 10 per centum of the total amount of such loans, advances of credit, and purchases. With respect to any loan, advance of credit, or purchase, the amount of any claim for loss on any such individual loan, advance of credit or purchase paid by the Secretary under the provi- sions of this section to a lending institution shall not exceed 90 per centum of such loss. After August 2, 1954, (i) the Secretary shall not enter into contracts for insurance pursuant to this section except with lending institutions which are subject to the inspection and super- vision of a governmental agency required by law to make periodic examinations of their books and accounts, and which the Secretary finds to be qualified by experience or facilities to make and service such loans, advances or purchases, and with such other lending institutions which the Secretary approves as eligible for insurance pursuant to this section on the basis of their credit and their experience or facilities to make and service such loans, advances or purchases; (ii) only such items as substantially protect or improve the basic livability or utility of prop- erties shall be eligible for financing under this section, and therefore the Secretary shall from time to time declare ineligible for financing under this section any item, product, alteration, repair, improvement, or class thereof which he determines would not substantially protect or improve the basic livability or utility of such properties, and he may also declare ineligible