Advances to Housing Associates--2022 Supporting Statement

“ADVANCES TO HOUSING ASSOCIATES”
OMB NUMBER 2590-0001
SUPPORTING STATEMENT
A. JUSTIFICATION
1. Circumstances Necessitating the Collection of Information
Section 10b of the Federal Home Loan Bank Act (Bank Act) 1 establishes the requirements for
making Federal Home Loan Bank (Bank) advances (i.e., loans) to nonmember mortgagees, which
are referred to as “Housing Associates” in the regulations of the Federal Housing Finance Agency
(FHFA). 2 Section 10b also establishes the eligibility requirements an applicant must meet in order
to be certified as a Housing Associate.
Part 1264 of FHFA’s regulations implements the statutory eligibility requirements and establishes
uniform review criteria the Banks must use in evaluating applications from entities that wish to be
certified as a Housing Associate. Specifically, § 1264.4 implements the statutory eligibility
requirements and provides guidance to an applicant on how it may satisfy those requirements. 3
Section 1264.5 authorizes the Banks to approve or deny all applications for certification as a
Housing Associate, subject to the statutory and regulatory requirements. 4 Section 1264.6 permits
an applicant that has been denied certification by a Bank to appeal that decision to FHFA. 5
In part 1266 of FHFA’s regulations, subpart B governs Bank advances to Housing Associates that
have been approved under part 1264. Section 1266.17 establishes the terms and conditions under
which a Bank may make advances to Housing Associates. 6 Specifically, section 1266.17(e)
imposes a continuing obligation on each certified Housing Associate to provide information
necessary for the Bank to determine if it remains in compliance with applicable statutory and
regulatory requirements, as set forth in part 1264.
2. Use of Data

1

12 U.S.C. § 1430b.

2

See 12 CFR 1264.3.

3

See 12 CFR 1264.4.

4

See 12 CFR 1264.5.

5

See 12 CFR 1264.6.

6

See 12 CFR 1266.17.

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The Banks use the information collection contained in §§ 1264.4 and 1264.5 to determine whether
an entity satisfies the statutory and regulatory requirements to be certified initially, and to maintain
its status as a Housing Associate eligible to receive Bank advances. FHFA may also use the
information collection to determine whether to uphold or overrule a Bank's decision to deny
Housing Associate certification to an applicant.
3. Use of Information Technology
Banks may accept applications and reports in Adobe Portable Document Format (PDF) that are
sent by email. Otherwise, the information collection does not involve the use of automated,
electronic, mechanical, or other technological collection techniques or other forms of information
technology.
4. Efforts to Identify Duplication
The information collection avoids duplication by permitting the submission of information that
already is available to, or compiled by, an applicant for other purposes. For instance, an applicant
may meet the requirement in section 10b(a) of the Bank Act and section 1264.4(a) of the
regulations that it be approved under Title II of the National Housing Act by submitting a current
Department of Housing and Urban Development (HUD) Yearly Verification Report or
other documentation issued by HUD stating that it is an approved mortgagee. Further, an applicant
may meet the requirement in section 10b(a) of the Bank Act and section 1264.4(d) of the
regulations that its principal activity in the mortgage field consists of lending its own funds and
advances may be safely made by submitting previously prepared financial statements and other
financial documents. To satisfy the other eligibility requirements, an applicant may provide copies
of applicable federal, state, or local laws and/or regulations.
5. Impact on Small Entities
The information collection will not have a significant economic impact on a substantial number of
small entities. The rule implements statutory requirements and is applicable to all applicants for
certification and certified Housing Associates regardless of their size. FHFA does not have the
authority to make adjustments to the statutory requirements to accommodate small entities.
6. Consequences of Less Frequent Collection and Obstacles to Burden Reduction
If the information were not collected at the time an applicant seeks to be certified as a Housing
Associate, a Bank would be unable to determine whether the applicant satisfies the statutory
eligibility criteria, and FHFA would be unable to determine whether to uphold or overrule a Bank's
decision to deny Housing Associate certification to an applicant.
7. Circumstances Requiring Special Information Collection
There are no special circumstances requiring the information collection to be conducted in a
manner inconsistent with OMB guidelines.
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8. Solicitation of Comments on Information Collection
In accordance with the requirements of 5 CFR 1320.8(d), FHFA published a request for public
comments regarding this information collection in the Federal Register on March 3, 2022. 7 The
60-day comment period closed on May 2, 2022. FHFA received no comments.
9. Provision of Payments or Gifts to Respondents
No payment or gift is provided to any respondent.
10. Assurance of Confidentiality
The Banks and FHFA will maintain the confidentiality of information obtained from respondents
as required by applicable statute, regulation, or agency policy.
11. Questions of a Sensitive Nature
There are no questions of a sensitive nature in the information collection.
12. Estimates of the Hour Burden of the Information Collection
FHFA estimates the annualized hour burden imposed upon respondents by this information
collection to be 314 hours. It estimates the associated annualized hourly costs to respondents to be
$39,027, which includes salaries, benefits, and overhead costs.
These totals comprise both the estimated burdens imposed upon institutions applying to be certified
as a Housing Associate for the first time (14 hours; $1,452) and upon existing Housing Associates
providing information to confirm that they continue to qualify (300 hours; $37,575). Based on
historical experience, FHFA projects that, in a five-year period, the agency may hear one appeal
filed by an applicant that has been rejected for certification as a Housing Associate. Because of the
infrequency of these appeals (in fact, one has never occurred), the burdens associated with the
appeal process have not been included in the estimates.
To derive hourly costs, FHFA used as a base the May 2021 hourly wage figures from the Bureau of
Labor Statistics (BLS) for the occupation of the person performing each task, 8 then added

7

See 87 FR 12168 (March 3, 2022).

FHFA used the hourly wage figures reported in the National Occupational Employment and Wage Estimates for May
2017 published by the BLS, the most recent data available. See https://www.bls.gov/oes/2017/may/oes_nat.htm. The
occupational categories used were financial analyst (13-2051) and lawyer (23-1011). FHFA used the mean hourly
wage for the financial analyst category but used the 75th percentile wage for the lawyer category to reflect the fact that
the materials would likely be reviewed by more highly compensated corporate lawyers.
8

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approximately 46.4 percent to those amounts to account for the cost of benefits, 9 then adjusted that
total amount for a 3.6 percent increase in employer costs for total compensation between June 2021
and March 2022. 10 FHFA’s total burden estimates are based on the following calculations:
I. Applicants
In the three-year period between June 30, 2018 and June 30, 2021, the Banks collectively certified
a total of two new Housing Associates. Based on those figures, FHFA estimates that an average of
one applicant will apply to a Bank for certification as a new Housing Associate in each of the next
three years. The estimated annualized hour burden on those entities is 14 hours and the estimated
annualized costs are $1,452, based on the following calculations:
Financial Analyst compiles and reviews the necessary documentation for application
submission to the Bank:
•
•
•
•
•

Processing time:
Total applications:
Total hours:
Hourly rate:
Total cost:

8 hours
1
8
$75
$600

Attorney reviews membership application to conform statutory and regulatory eligibility:
•
•
•
•
•

Processing time:
Total applications:
Total hours:
Hourly rate:
Total cost:

6 hours
1
6
$142
$852

II. Current Housing Associates
FHFA estimates that an average of 75 existing Housing Associates will provide information to a
Bank to establish their continuing eligibility in each of the next three years. This estimate is
derived by adding to the number of existing Housing Associates as of June 30, 2021 (73) one-half
of the number of new Housing Associates that the agency estimates will be certified over the next 3
years rounded up to the nearest whole number (3/2 = 1.5, rounded up to 2; 73 + 2 = 75). The
estimated annualized hour burden on those Housing Associates is 300 hours and the estimated
annualized costs are $37,575, based on the following calculations:
FHFA made these adjustments based on data reported in Employer Costs for Employee Compensation for March
2022 published by the BLS, which indicated that for all civilian workers 69 percent of total compensation was in wages
and salaries, while 31 percent was in benefits. See https://www.bls.gov/news.release/ecec.t01.htm.
9

BLS’s Employment Cost Index for total compensation for all civilian workers increased from 144.8 to 150.1
between June 2021 and March 2022. See https://www.bls.gov/web/eci/ecicois.pdf.

10

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Financial Analyst compiles and reviews the documentation to provide periodic financial
statements to the Bank:
•
•
•
•
•

Processing time:
Total Housing Associates:
Total hours:
Hourly rate:
Total cost:

1 hour
75
75
$75
$5,625

Attorney reviews the documentation to provide periodic financial statements to the Bank:
•
•
•
•
•

Processing time:
Total Housing Associates:
Total hours:
Hourly rate:
Total cost:

3 hours
75
225
$142
$31,950

13. Estimated Total Annualized Cost Burden to Respondents
There are no capital, start-up, or maintenance costs associated with this information collection.
14. Estimated Cost to the Federal Government
The estimated annual cost burden to the Federal government is $0.
15. Reasons for Change in Burden
FHFA has decreased the estimated total annual burden hours slightly to 314 hours from 318 that
were shown in the Supporting Statement submitted with the request for renewal of this information
collection in 2019. This decrease is due to a decrease (to 75 from 76) in the estimated number of
existing Housing Associates that will need to comply with the annual reporting requirements.
Despite reducing the overall estimate as to burden hours, FHFA’s estimate as to the total costs
associated with that burden has risen to $39,027 from the $36,552 reflected in the Supporting
Statement for the 2019 renewal, due to an increase in the per-hour cost estimates.
16. Plans for Tabulation, Statistical Analysis and Publication
The results of this information collection will not be published.
17. If Seeking Approval to Not Display the Expiration Date for OMB Approval of the
Information Collection, Explain the Reasons Why Display Would Be Inappropriate
FHFA plans to display the expiration date for OMB approval.
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18. Explain Each Exception to the Topics of the Certification Statement Identified in
“Certification for Paperwork Reduction Act Submission.”
There are no exceptions to the certification statement identified in Item 18.
B. COLLECTION OF INFORMATION EMPLOYING STATISTICAL METHODS
This information collection does not employ statistical methods.

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