Mortgage Assets Affected by PACE Programs

SUMMARY: The Federal Housing Finance Agency ("FHFA") hereby issues this Advance Notice of Proposed Rulemaking ("ANPR") concerning mortgage assets affected by Property Assessed Clean Energy ("PACE") programs and Notice of Intent ("NOI") to prepare an environmental impact statement ("EIS") under the National Environmental Policy Act ("NEPA") to address the potential environmental impacts of FHFA’s proposed action.

The United States District Court for the Northern District of California issued a preliminary injunction ordering FHFA "to proceed with the notice and comment process" in adopting guidance concerning mortgages that are or could be affected by PACE programs. Specifically, the California District Court ordered FHFA to "cause to be published in the Federal Register an Advance Notice of Proposed Rulemaking relating to the statement issued by FHFA on July 6, 2010, and the letter directive issued by FHFA on February 28, 2011, that deal with property assessed clean energy (PACE) programs."

In response to and compliance with the California District Court’s order, FHFA is seeking comment on whether the restrictions and conditions set forth in the July 6, 2010 Statement and the February 28, 2011 Directive should be maintained, changed, or eliminated, and whether other restrictions or conditions should be imposed. FHFA has appealed the California District Court’s order to the U.S. Court of Appeals for the Ninth Circuit (the "Ninth Circuit"). Inasmuch as the California District Court’s order remains in effect pending the outcome of the appeal, FHFA is proceeding with the publication of this ANPR and NOI pursuant to that order. The Ninth Circuit has stayed, pending the outcome of FHFA’s appeal, the portion of the California District Court’s Order requiring publication of a final rule. FHFA reserves the right to withdraw this ANPR and NOI should FHFA prevail in its appeal, and may in that situation continue to address the financial risks FHFA believes PACE programs pose to safety and soundness through means other than notice-and-comment rulemaking.

DATES: Written comments must be received on or before March 26, 2012.​