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    Subject Term: "Mortgage programs"

    12 publications with a total of 42 open recommendations including 1 priority recommendation
    Director: Cheryl E. Clark
    Phone: (202) 512-9377

    4 open recommendations
    Recommendation: To help ensure that subsidy cost estimates for the Mutual Mortgage Insurance Fund are supported, reliable, and reasonable, the Secretary of Housing and Urban Development should direct the Principal Deputy Assistant Secretary for the Office of Housing to develop detailed policies and procedures over the subsidy cost estimation process that address, at a minimum, the documentation that should be prepared and maintained to support subsidy cost estimates and the process to document management review and approval of subsidy costs estimates.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: In response to our recommendation, HUD said that a new contract was issued that will address documentation of the MMI cash flow model and the subsidy cost estimation process. HUD also said that it was in the process of developing a solicitation for a contractor to perform an independent verification and validation of the MMI cash flow model. HUD stated that completing this documentation of the subsidy cost estimation process will help management oversee the program as required by internal control standards and help support its subsidy cost estimates. We are awaiting supporting documentation for actions taken by HUD to address this recommendation.
    Recommendation: To help ensure that subsidy cost estimates for the Direct Student Loan Program are supported, reliable, and reasonable, the Secretary of Education should direct the Assistant Secretary for the Office of Planning, Evaluation and Policy Development to develop detailed policies and procedures over the subsidy cost estimation process that address, at a minimum, the documentation that should be prepared and maintained to support subsidy cost estimates and the process to document management review and approval of subsidy cost estimates.

    Agency: Department of Education
    Status: Open

    Comments: The Department of Education (Education) agreed with this recommendation. Education stated that has detailed procedures for developing and validating subsidy cost estimates. These procedures include, but are not limited to, establishing a baseline scenario, documenting each assumption individually, comparing estimates to actual data, and management review and sign-off. Education has begun drafting a more detailed document that will describe policies and procedures.
    Recommendation: To help ensure that subsidy cost estimates for the Direct Student Loan Program are supported, reliable, and reasonable, the Secretary of Education should direct the Assistant Secretary for the Office of Planning, Evaluation and Policy Development to develop detailed documentation of the cash flow model used to estimate subsidy costs, including the rationale for model calculations, all formulas and assumptions used in the model, data sources, the process to update and document changes to the model, and the process to document management review and approval of the model, which may be based on an independent verification and validation of the model to ensure that calculations are accurate and consistent with the model documentation.

    Agency: Department of Education
    Status: Open

    Comments: The Department of Education (Education) agreed with this recommendation. Education stated that it is committed to continuous improvements in its cash flow model and how it is documented. The cash flow model includes inputs of modeled data, referred to as assumptions, together with program-determined static values, such as interest rates and fees. Education stated that it will update its detailed documentation of its cash flow model. In addition, Education is investing staff and resources into developing a new cash flow model to estimate subsidy costs. Detailed documentation of this new cash flow model will be prepared before the model becomes operational. We will review Education's new cash flow model documentation once it is completed.
    Recommendation: To help ensure that subsidy cost estimates for the Direct Student Loan Program are supported, reliable, and reasonable, the Secretary of Education should direct the Assistant Secretary for the Office of Planning, Evaluation and Policy Development to document the procedures and results of such procedures used to develop or support key elements of the subsidy cost estimation process, addressing at a minimum (1) the reliability of historical data, (2) the rationale for informed opinion when applicable, (3) the methods used to calculate cash flow assumptions, (4) the process to ensure that subsidy cost estimates are consistent with the terms and conditions of the program, (5) the process to assess estimated cash flows for reasonableness, and (6) the process used to perform sensitivity analysis.

    Agency: Department of Education
    Status: Open

    Comments: The Department of Education (Education) agreed with this recommendation. Education stated that it will work on developing more detailed policies and procedures which will address the key elements referenced in this recommendation.
    Director: Mathew Scirè
    Phone: (202) 512-8678

    8 open recommendations
    Recommendation: To improve compliance with OMB Circular A-129 standards and strengthen management and oversight of the guarantee program, and to enhance screening of loan guarantee applicants, the Secretary of Agriculture should direct the Undersecretary for Rural Development to complete steps to obtain access to Treasury's Do Not Pay portal and establish policies and procedures to deny loan guarantees to applicants who are subject to administrative offsets for delinquent child support payments.

    Agency: Department of Agriculture
    Status: Open

    Comments: As of August 2017, Rural Development said it was in the process of gaining access to Treasury's Do Not Pay portal in order to conduct the recommended screening of loan guarantee applicants.
    Recommendation: To improve compliance with OMB Circular A-129 standards and strengthen management and oversight of the guarantee program, and to strengthen oversight of lenders and servicers, the Secretary of Agriculture should direct the Undersecretary for Rural Development to develop and publish in the Federal Register qualification requirements for the principal officers of lenders and servicers seeking initial or continued approval to participate in the guarantee program.

    Agency: Department of Agriculture
    Status: Open

    Comments: As of August 2017, Rural Development said it had drafted a regulatory work plan to propose qualification requirements for principal officers of lenders and servicers.
    Recommendation: To improve compliance with OMB Circular A-129 standards and strengthen management and oversight of the guarantee program, and to strengthen oversight of lenders and servicers, the Secretary of Agriculture should direct the Undersecretary for Rural Development to develop and publish in the Federal Register capital and financial requirements for guarantee program lenders that are not regulated by a federal financial institution regulatory agency.

    Agency: Department of Agriculture
    Status: Open

    Comments: As of August 2017, Rural Development said it had drafted a regulatory work plan to propose lender capital and financial requirements.
    Recommendation: To improve compliance with OMB Circular A-129 standards and strengthen management and oversight of the guarantee program, and to strengthen oversight of lenders and servicers, the Secretary of Agriculture should direct the Undersecretary for Rural Development to establish standing policies and procedures to help ensure that the agency reviews the eligibility of lenders and servicers participating in the guarantee program at least every 2 years.

    Agency: Department of Agriculture
    Status: Open

    Comments: As of August 2017, Rural Development said it was planning to automate reviews of lender eligibility every 2 years, but in the meantime was using a manual process. We will update the status of this recommendation when Rural Development provides standing policies and procedures regarding the frequency of its lender and servicer eligibility reviews.
    Recommendation: To improve compliance with OMB Circular A-129 standards and strengthen management and oversight of the guarantee program, and to strengthen risk assessment and reporting, the Secretary of Agriculture should direct the Undersecretary for Rural Development to improve performance measures comparing RHS and the Federal Housing Administration loan performance, potentially by making comparisons on a cohort basis and limiting comparisons to loans made in similar geographic areas.

    Agency: Department of Agriculture
    Status: Open

    Comments: As of August 2017, Rural Development said it had hired a contractor to develop more meaningful performance measures.
    Recommendation: To improve compliance with OMB Circular A-129 standards and strengthen management and oversight of the guarantee program, and to strengthen risk assessment and reporting, the Secretary of Agriculture should direct the Undersecretary for Rural Development to develop risk thresholds for the guarantee program, potentially in the form of maximum portfolio- or loan-level loss tolerances.

    Agency: Department of Agriculture
    Status: Open

    Comments: Rural Development hired a contractor to help establish risk thresholds for the guarantee program. The contractor's October 2016 report developed and recommended portfolio-level and loan-level risk thresholds (values that trigger consideration of policy adjustments) and also recommended that program officials conduct stress tests to validate that each recommended risk threshold was appropriate for the program's overall risk appetite. As of August 2017, Rural Development had not provided documentation that it had validated and implemented the risk thresholds.
    Recommendation: To improve compliance with OMB Circular A-129 standards and strengthen management and oversight of the guarantee program, and to strengthen risk assessment and reporting, the Secretary of Agriculture should direct the Undersecretary for Rural Development to identify issues for increased management focus in high-level dashboard reports.

    Agency: Department of Agriculture
    Status: Open

    Comments: As of August 2017, Rural Development had not provided examples of high-level dashboard reports that clearly identify issues for increased management focus.
    Recommendation: To improve compliance with OMB Circular A-129 standards and strengthen management and oversight of the guarantee program, and to more effectively fulfill the requirements for conducting program reviews described in OMB Circular A-129, the Secretary of Agriculture should direct the Undersecretary for Rural Development to develop procedures for selecting RD credit programs for review based on risk and establish a prioritized schedule for conducting the reviews.

    Agency: Department of Agriculture
    Status: Open

    Comments: As of August 2017, Rural Development said that its Chief Risk Officer was working to establish procedures for selecting Rural Development credit programs for review based on risk, including a prioritized schedule.
    Director: Lawrance L. Evans Jr.,
    Phone: (202) 512-8678

    1 open recommendations
    Recommendation: To ensure that FHFA has adequate authority to ensure the safety and soundness of the enterprises and to clarify its supervisory role, Congress should consider granting FHFA explicit authority to examine third parties that do business with and play a critical role in the operations of the enterprises.

    Agency: Congress
    Status: Open

    Comments: As of April 2017, Congress has not taken any action on this matter.
    Director: Garcia-diaz, Daniel
    Phone: (202) 512-4529

    2 open recommendations
    including 1 priority recommendation
    Recommendation: To better ensure that taxpayer funds are being used effectively, Congress should consider permanently rescinding any Treasury-deobligated excess MHA balances that Treasury does not move into the Hardest Hit Fund.

    Agency: Congress
    Status: Open

    Comments: Congress has not taken any action since Treasury has not deobligated MHA program funds beyond the $2 billion that it transferred to the TARP-funded Hardest Hit Fund.
    Recommendation: To provide Congress and others with accurate assessments of the funding that has been and will likely be used to help troubled borrowers and to identify any potential obligations not likely to be used, the Secretary of the Treasury should deobligate funds that its review shows will likely not be expended and obligate up to $2 billion of such funds to the TARP-funded Hardest Hit Fund as authorized by the Consolidated Appropriations Act, 2016.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: Treasury agreed with the recommendation and deobligated $2 billion as of February 2016 based on its updated MHA program cost estimates and indicated that it plans to commit this $2 billion to the Hardest Hit Fund program, as recommended by GAO. However, Treasury has not deobligated an additional $2.7 billion in potential excess program funds identified by the cost estimate. Treasury has stated that it does not expect to deobligate any estimated excess funds from the MHA program prior to December 2017, when servicers report data on all final transactions. We maintain that Treasury should deobligate additional excess MHA funds that its review showed will likely not be expended and further update its cost estimates as additional information becomes available.
    Director: Alicia Puente Cackley
    Phone: (202) 512-8678

    2 open recommendations
    Recommendation: To help ensure that adequate data collection efforts by state insurance regulators produce sufficient, reliable data to oversee the LPI market, NAIC should work with the state insurance regulators to develop and implement more robust policies and procedures for the collection of annual data from LPI insurers to ensure they are complete and reliable.

    Agency: National Association of Insurance Commissioners
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To help ensure that adequate data collection efforts by state insurance regulators produce sufficient, reliable data to oversee the LPI market, NAIC should work with the state insurance regulators to complete efforts to obtain more detailed national data from LPI insurers.

    Agency: National Association of Insurance Commissioners
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Director: Mathew J. Scirè
    Phone: (202) 512-8678

    8 open recommendations
    Recommendation: To enhance the effectiveness of its preparations for conducting a retrospective review of its QM regulations, CFPB should complete its plan. The plan should identify what outcomes CFPB will examine to measure the effects of the regulations and the specific metrics, baselines, and analytical methods to be used. Furthermore, to account for and help mitigate the limitations of existing data and the uncertain availability of enhanced datasets, CFPB should include in its plan alternate metrics, baselines, and analytical methods that could be used if data were to remain unavailable.

    Agency: Consumer Financial Protection Bureau
    Status: Open

    Comments: In January 2017, CFPB staff noted that the Bureau produced a high-level research plan in November 2016 and organized a research team for the ATR-QM Assessment. CFPB staff stated that they are working to identify the outcomes CFPB will examine to measure the effects of the regulations, including the specific metrics, baselines, and analytical methods to be used. CFPB staff noted that they have also begun analyzing the data the Bureau has on-hand, planning for the collection of additional data, and drafting a Federal Register notice request for information regarding the plan.
    Recommendation: To enhance the effectiveness of its preparations for conducting a retrospective review of its QM regulations, HUD should develop a plan that identifies the metrics, baselines, and analytical methods to be used. Furthermore, to account for and help mitigate the limitations of existing data and the uncertain availability of enhanced datasets, HUD should include in its plan alternate metrics, baselines, and analytical methods that could be used data were to remain unavailable.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: In February 2017, HUD noted that it does not currently collect data on the annual percentage rate (APR) for each loan that would allow for a perfect comparison to the average prime offer rate. According to HUD, its Office of Housing has on its long-term list of systems priorities to collect specific information from the Uniform Closing Data that could be used to conduct such a comparison. However, HUD stated that it has not received adequate funding to meet these systems enhancements. According to HUD, it is considering the feasibility and potential utility of alternative data sources or the use of a proxy in an appropriate methodology. For instance, whether it may be possible to approximate the APR based upon the note rate and information on closing costs that is collected in the current data system, or alternatively, whether the APR could be obtained or approximated through matching Home Mortgage Disclosure Act data for FHA loans.
    Recommendation: To enhance the effectiveness of their preparations for conducting a retrospective review of the QRM regulations, the agencies responsible for the QRM regulations--Federal Deposit Insurance Corporation, Federal Housing Finance Agency, Board of Governors of the Federal Reserve System, HUD, Office of the Comptroller of the Currency, and Securities and Exchange Commission--should develop a plan that identifies the metrics, baselines, and analytical methods to be used and specify the roles and responsibilities of each agency in the review process. Furthermore, to account for and help mitigate limitations of existing data and the uncertain availability of enhanced datasets, the six agencies should include in their plan alternate metrics, baselines, and analytical methods that could be used if data were to remain unavailable.

    Agency: Federal Housing Finance Agency
    Status: Open

    Comments: In January 2017, FHFA informed GAO that SEC had shared its draft plan with the other participating agencies and there was an interagency call to discuss the plan on December 20, 2016. FHFA confirmed that there was an interagency call on that date to discuss the QRM review. FHFA noted that it was developing its own plan, and anticipated that the plan would be completed by June 30, 2017. Depending on changes in the structure of the mortgage market, FHFA stated that it will further update the plan as the agency approaches the start of the official QRM definition review in 2019. As with the 2014 final rule, FHFA staff expected that FHFA's participation will focus on the analysis of Fannie Mae and Freddie Mac residential mortgage data.
    Recommendation: To enhance the effectiveness of their preparations for conducting a retrospective review of the QRM regulations, the agencies responsible for the QRM regulations--Federal Deposit Insurance Corporation, Federal Housing Finance Agency, Board of Governors of the Federal Reserve System, HUD, Office of the Comptroller of the Currency, and Securities and Exchange Commission--should develop a plan that identifies the metrics, baselines, and analytical methods to be used and specify the roles and responsibilities of each agency in the review process. Furthermore, to account for and help mitigate limitations of existing data and the uncertain availability of enhanced datasets, the six agencies should include in their plan alternate metrics, baselines, and analytical methods that could be used if data were to remain unavailable.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: In February 2017, HUD stated that it has engaged in preliminary discussions both internally and with the other five partner agencies to the 2014 QRM Joint Regulation: OCC, the Federal Reserve Board, FDIC, FHFA and SEC. Based on GAO's recommendations, HUD stated that it has also conducted initial reviews of existing and potential methodologies and data sources that may inform the review. HUD also noted that as a fundamental matter, FHA insured mortgages are only securitized through the Government National Mortgage Association (GNMA). Both FHA and GNMA have extensive underlying requirements regarding both mortgage terms and conditions as well as requirements related to the securitization of those mortgages. According to HUD, its retrospective review of the QRM rule, in terms of any impact on FHA single family insurance programs, will take into account the existing underlying FHA and GNMA statutes and regulations that already govern those programs.
    Recommendation: To enhance the effectiveness of their preparations for conducting a retrospective review of the QRM regulations, the agencies responsible for the QRM regulations--Federal Deposit Insurance Corporation, Federal Housing Finance Agency, Board of Governors of the Federal Reserve System, HUD, Office of the Comptroller of the Currency, and Securities and Exchange Commission--should develop a plan that identifies the metrics, baselines, and analytical methods to be used and specify the roles and responsibilities of each agency in the review process. Furthermore, to account for and help mitigate limitations of existing data and the uncertain availability of enhanced datasets, the six agencies should include in their plan alternate metrics, baselines, and analytical methods that could be used if data were to remain unavailable.

    Agency: Department of the Treasury: Office of the Comptroller of the Currency
    Status: Open

    Comments: In its comment letter on the draft report, OCC indicated that it planned to take GAO's recommendation into account as it monitored mortgage market conditions and prepared for upcoming QRM reviews. OCC stated that it planned to periodically meet with the other agencies to discuss the implications of any trends it observes and coordinate on studies to better focus and support its evaluation of the review factors.
    Recommendation: To enhance the effectiveness of their preparations for conducting a retrospective review of the QRM regulations, the agencies responsible for the QRM regulations--Federal Deposit Insurance Corporation, Federal Housing Finance Agency, Board of Governors of the Federal Reserve System, HUD, Office of the Comptroller of the Currency, and Securities and Exchange Commission--should develop a plan that identifies the metrics, baselines, and analytical methods to be used and specify the roles and responsibilities of each agency in the review process. Furthermore, to account for and help mitigate limitations of existing data and the uncertain availability of enhanced datasets, the six agencies should include in their plan alternate metrics, baselines, and analytical methods that could be used if data were to remain unavailable.

    Agency: Federal Deposit Insurance Corporation
    Status: Open

    Comments: In February 2017, FDIC indicated that it developed a plan that outlines the baseline, data, metrics, and analytical methods that it plans to utilize in the QRM definition review. According to FDIC, the plan also outlines FDIC's commitment to working collaboratively with the other agencies. As a baseline, FDIC plans to use the data, metrics, and analytical methods used in the final rulemaking process as outlined in the Supplementary Information to the credit risk retention (CRR) regulation as well as data and analytical methods that the FDIC currently uses to monitor the mortgage and securitization markets and economy on an ongoing basis. FDIC stated that it continues to plan to coordinate with the other agencies on the QRM definition review by allocating responsibilities based on expertise, data, and other resources within each agency as the agencies did in the CRR rulemaking process.
    Recommendation: To enhance the effectiveness of their preparations for conducting a retrospective review of the QRM regulations, the agencies responsible for the QRM regulations--Federal Deposit Insurance Corporation, Federal Housing Finance Agency, Board of Governors of the Federal Reserve System, HUD, Office of the Comptroller of the Currency, and Securities and Exchange Commission--should develop a plan that identifies the metrics, baselines, and analytical methods to be used and specify the roles and responsibilities of each agency in the review process. Furthermore, to account for and help mitigate limitations of existing data and the uncertain availability of enhanced datasets, the six agencies should include in their plan alternate metrics, baselines, and analytical methods that could be used if data were to remain unavailable.

    Agency: Federal Reserve System: Board of Governors
    Status: Open

    Comments: In January 2017, the Federal Reserve Board stated that it has an ongoing program to monitor the mortgage and securitization markets as part of its monetary policy, regulatory, and financial stability responsibilities. According to the Federal Reserve, Board staff are continuously researching new data sources, analytical methods, and metrics as part of that program. The Federal Reserve also noted that Board staff with responsibility for implementing this recommendation continue to meet with their counterparts at other agencies.
    Recommendation: To enhance the effectiveness of their preparations for conducting a retrospective review of the QRM regulations, the agencies responsible for the QRM regulations--Federal Deposit Insurance Corporation, Federal Housing Finance Agency, Board of Governors of the Federal Reserve System, HUD, Office of the Comptroller of the Currency, and Securities and Exchange Commission--should develop a plan that identifies the metrics, baselines, and analytical methods to be used and specify the roles and responsibilities of each agency in the review process. Furthermore, to account for and help mitigate limitations of existing data and the uncertain availability of enhanced datasets, the six agencies should include in their plan alternate metrics, baselines, and analytical methods that could be used if data were to remain unavailable.

    Agency: United States Securities and Exchange Commission
    Status: Open

    Comments: In January 2017, SEC staff stated that they had developed a preliminary review plan for the QRM rule in December 2016. SEC staff noted that although the review plan describes several proposed analytical approaches, the precise analytical approach to review the mortgage market conditions and the definition of QRM will depend on future data availability, future mortgage market conditions, and the role of Fannie Mae, Freddie Mac, and other participants in those markets at that time. To prepare for this review, SEC staff noted that they intend to meet on a periodic basis with the staff of the other agencies to share the results of the analyses discussed above, understand the analyses being performed by the other agencies, and discuss what additional data or analyses may be helpful. As part of these discussions, SEC staff stated that the agencies will likely divide responsibilities for conducting the review according to agency expertise and resources, consistent with each agency's statutory authority and role.
    Director: Mathew Scirè
    Phone: (202) 512-8678

    1 open recommendations
    Recommendation: To improve monitoring and oversight of Treasury's HAMP, the Secretary of the Treasury should conduct periodic evaluations using analytical methods, such as econometric modeling as appropriate, to help explain differences among MHA servicers in redefault rates that may inform its compliance reviews of individual servicers, identify areas of weaknesses and best practices, and determine the potential need for additional program policy changes.

    Agency: Department of the Treasury
    Status: Open

    Comments: Treasury put together a list of servicers with reporting anomalies that had been identified and sent them questionnaires asking them to explain the rationale behind using certain codes to report denials (denial codes) of applications for trial modifications. Treasury expects to have answers back by October 2015. Treasury's compliance agent has also added procedures for testing denial codes that servicers report. Although these are examples of analysis of overall denial rates, Treasury's actions do not address differences in individual MHA servicers' reasons for denial. Additionally, it is not clear whether Treasury plans to conduct periodic evaluations of differences in denial rates or how Treasury will use the information it gathers to identify areas of weaknesses and best practices and determine whether additional policy changes are needed. Thus, we continue to maintain that Treasury should take action to implement this recommendation.
    Director: Mathew J.Scirè
    Phone: (202) 512-8678

    6 open recommendations
    Recommendation: To better ensure the viability and safety of manufactured housing produced in accordance with the HUD Code, the Secretary of the Department of Housing and Urban Development should develop a plan to assess how FHA financing might further promote the affordability of manufactured homes and identify the potential for better securitization of manufactured housing financing.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To better ensure the viability and safety of manufactured housing produced in accordance with the HUD Code, the Secretary of the Department of Housing and Urban Development should strengthen the oversight of inspections and enforcement-related activities by (1) consistently documenting actions taken to resolve recommendations from completed audits and the outcome of such actions, (2) completing a Transition Plan for the monitoring contractor activity, and (3) exploring the feasibility of developing a cost-effective systematic process for collecting and evaluating information on the content of complaints.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To better ensure that Congress, stakeholders, and agencies have complete information about changing costs and whether a fee needs to be changed, HUD should complete the necessary rulemaking changes to allow the Office of Manufactured Housing Programs to adjust its label fees from the $39 per label toward levels up to the congressionally authorized level that better reflect the current levels of manufactured home production, while considering the impact that such fees may have on the industry; put in place a process for regular fee reviews to determine whether the fees currently being charged will allow the program to respond to spikes and surges in label fee revenue and to identify any factors that may drive label fee revenue instability; and identify any additional sources of funding that may mitigate initial revenue shortfalls and the program's fixed and variable costs.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To better ensure that Congress, stakeholders, and agencies have complete information about changing costs and whether a fee needs to be changed, HUD should assess the feasibility, including an analysis of the benefits and costs, of putting in place user fees for its dispute resolution and installation programs.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To better ensure that Congress, stakeholders, and agencies have complete information about changing costs and whether a fee needs to be changed, HUD should establish the goals for use of reserves of the Manufactured Housing Fees Trust Fund, and the minimum and maximum thresholds for the reserves appropriate for meeting these goals.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To better ensure the viability and safety of manufactured housing produced in accordance with the HUD Code, the Secretary of the Department of Housing and Urban Development (HUD) should develop and implement a plan for updating construction and safety standards for manufactured homes on a timely, recurring basis to include: (1) addressing unresolved issues related to defining and developing sufficient economic analyses tied to proposed changes to the construction and safety standards; and (2) ensuring sufficient resources and capacity within HUD and the Manufactured Housing Consensus Committee and its administering organization; or if such a plan cannot be devised and implemented, identify and report to Congress on alternative methods of ensuring the quality, durability, safety, and affordability of manufactured homes, including the possibility of relying more extensively on existing industry standards.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Director: Scire, Mathew J
    Phone: (202) 512-8678

    2 open recommendations
    Recommendation: To strengthen FHA accountability for complying with the Fund's statutory capital requirement, Congress should consider requiring that FHA submit a capital restoration plan and regular updates on plan implementation whenever the capital ratio falls below 2 percent as calculated in the annual actuarial review of the Fund, or the Fund's financial condition does not meet other congressionally-defined requirements.

    Agency: Congress
    Status: Open

    Comments: Congress has not yet acted on this matter for consideration.
    Recommendation: To provide additional perspective on the Fund's financial status, FHA should disclose estimates of the individual cash flows associated with the liability for loan guarantees (premiums, claims, and recoveries), including their value for each year of the 30-year estimation period.

    Agency: Department of Housing and Urban Development: Federal Housing Administration
    Status: Open

    Comments: As of July 2017, HUD has not yet acted on this recommendation.
    Director: Brown, Orice Williams
    Phone: (202)512-5837

    4 open recommendations
    Recommendation: While creating control systems at the same time that the emergency programs were being designed and implemented posed unique challenges, the recent crisis provided invaluable experience that the Federal Reserve System can apply in the future should the use of these authorities again become warranted. Going forward, to further strengthen policies for selecting vendors, ensuring the transparency and consistency of decision making involving the implementation of any future emergency programs, and managing risks related to these programs, the Chairman of the Federal Reserve Board should direct Federal Reserve Board and Reserve Bank staff to strengthen procedures in place to guide Reserve Banks' efforts to manage emergency program access for higher-risk borrowers by providing more specific guidance on how Reserve Bank staff should exercise discretion and document decisions to restrict or deny program access for depository institutions and primary dealers that would otherwise be eligible for emergency assistance.

    Agency: Federal Reserve System: Board of Governors
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: While creating control systems at the same time that the emergency programs were being designed and implemented posed unique challenges, the recent crisis provided invaluable experience that the Federal Reserve System can apply in the future should the use of these authorities again become warranted. Going forward, to further strengthen policies for selecting vendors, ensuring the transparency and consistency of decision making involving the implementation of any future emergency programs, and managing risks related to these programs, the Chairman of the Federal Reserve Board should direct Federal Reserve Board and Reserve Bank staff to document a plan for estimating and tracking losses that could occur under more adverse economic conditions within and across all emergency lending activities and for using this information to inform policy decisions, such as decisions to limit risk exposures through program design or restrictions applied to eligible borrowing institutions.

    Agency: Federal Reserve System: Board of Governors
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: While creating control systems at the same time that the emergency programs were being designed and implemented posed unique challenges, the recent crisis provided invaluable experience that the Federal Reserve System can apply in the future should the use of these authorities again become warranted. Going forward, to further strengthen policies for selecting vendors, ensuring the transparency and consistency of decision making involving the implementation of any future emergency programs, and managing risks related to these programs, the Chairman of the Federal Reserve Board should direct Federal Reserve Board and Reserve Bank staff, in drafting regulations to establish the policies and procedures governing emergency lending under section 13(3) of the Federal Reserve Act, to set forth the Federal Reserve Board's process for documenting, to the extent not otherwise required by law, its justification for each use of this authority.

    Agency: Federal Reserve System: Board of Governors
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: While creating control systems at the same time that the emergency programs were being designed and implemented posed unique challenges, the recent crisis provided invaluable experience that the Federal Reserve System can apply in the future should the use of these authorities again become warranted. Going forward, to further strengthen policies for selecting vendors, ensuring the transparency and consistency of decision making involving the implementation of any future emergency programs, and managing risks related to these programs, the Chairman of the Federal Reserve Board should direct Federal Reserve Board and Reserve Bank staff to document the Federal Reserve Board's guidance to Reserve Banks on types of emergency program decisions and risk events that require approval by or consultation with the Board of Governors, the Federal Open Market Committee, or other designated groups or officials at the Federal Reserve Board.

    Agency: Federal Reserve System: Board of Governors
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Director: Scire, Mathew J
    Phone: (202)512-6794

    1 open recommendations
    Recommendation: To strengthen accountability and transparency in FHA's management of the Fund, Congress may wish to consider clarifying (1) the definition of the Fund's capital ratio--specifically, whether the denominator of the ratio was intended to be the amortized insurance-in-force; (2) the definition of the phrase "established target subsidy rate" used in HERA; and (3) the nature and extent of information that FHA should be reporting on subsidy rates pursuant to HERA, recognizing that subsidy rates are generally only reestimated once a year under current budget processes.

    Agency: Congress
    Status: Open

    Comments: As of July 2017, Congress has not acted on this matter for consideration.
    Director: White, James R
    Phone: (202)512-5594

    3 open recommendations
    Recommendation: To enhance IRS's ability to detect noncompliance with mortgage debt forgiveness provisions, the Commissioner of Internal Revenue should modify Form 982, Part 1 to segregate the total dollar amount of forgiven debt by exclusion type and capture the information in IRS's databases.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: As of March 2017, IRS has not yet revised the Form 982 consistent with our recommendation. Form 982 directs taxpayers to identify the type(s) of forgiven debt. For example, taxpayers check a box to indicate forgiven mortgage debt used to buy, build, or substantially improve a principal residence. However, the Form 982 is used to report other types of forgiven debt, such as debt related to real property used in a trade or business, and the form does not require taxpayers to report the dollar amounts for each exclusion type. This means that IRS does not necessarily know how much of the forgiven debt should be attributed to a taxpayer's principal residence. Section 151 of division Q of the Consolidated Appropriations Act, 2016 (Public Law 114-113) extended the exclusion of forgiven mortgage debt to debt discharged before January 1, 2017. The Joint Committee on Taxation estimates the cost of this extension will be more than $5.1 billion for fiscal years 2016 and 2017 making it important for IRS to have more specific information from taxpayers concerning the amount of forgiven debt attributable to a taxpayer's principal residence.
    Recommendation: To enhance IRS's ability to detect noncompliance with mortgage debt forgiveness provisions, the Commissioner of Internal Revenue should modify the Form 982 and Form 1099-C so that filers disclose the address of the secured property for which the debt is being forgiven and capture the information in IRS's databases.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: While IRS has not revised the Forms 982 and 1099-C consistent with our recommendation, Congress directed IRS to collect additional information concerning mortgage interest payments, which prompted IRS to revise a related form. Congress in July 2015 enacted the Surface Transportation and Veterans Health Care Choice Improvement Act (Public Law 114-41). Section 2003 of the act requires taxpayers receiving mortgage interest payments to report the origination date of the mortgage, the amount of outstanding principal at the beginning of the calendar year, and the property's address. This new reporting requirement applies to returns that would be filed in 2017. In response to the legislation, IRS updated Form 1098 Mortgage Interest Statement. While IRS officials have told us that they believe the new data to be collected on this form have the potential to be helpful, they will not know the extent of any benefits from this new reporting requirement for several years. As of March 2017, IRS had not yet revised two other forms to the extent we recommended--the Forms 982 and 1099-C--to collect specific information from taxpayers and lenders concerning the amount of forgiven debt attributable to a principal residence and the location of the taxpayer's principal residence. Specifically, Form 982 does not direct taxpayers to identify the address for which debt is being forgiven nor does Form 1099-C direct lenders to report the address. Section 151 of division Q of the Consolidated Appropriations Act, 2016 (Public Law 114-113) extended the exclusion of forgiven mortgage debt to debt discharged before January 1, 2017. The Joint Committee on Taxation estimates the cost of this extension will be more than $5.1 billion for fiscal years 2016 and 2017, making it important for IRS to have more specific information concerning the address of the properties for which debt is being forgiven.
    Recommendation: To enhance IRS's ability to detect noncompliance with mortgage debt forgiveness provisions, the Commissioner of Internal Revenue should use the additional data reported on the revised Form 982 and Form 1099-C to assess the extent to which taxpayers are compliant.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: While IRS has not fully revised the Forms 982 and 1099-C consistent with our recommendation, Congress directed IRS to collect additional information concerning mortgage interest payments which prompted IRS to revise a related form, and IRS officials are considering how to use the additional data. As of March 2017, the Form 982 does not direct taxpayers to identify the address for which debt is being forgiven. For the Form 1099-C, IRS began requiring lenders to provide more information about the type of event that resulted in the cancellation of the debt. However, as of March 2017, the Form 1099-C does not direct lenders to report the address of the property for which mortgage debt is being forgiven. In July 2015, Congress enacted the Surface Transportation and Veterans Health Care Choice Improvement Act (Public Law 114-41). Section 2003 of the act requires taxpayers receiving mortgage interest payments to report the origination date of the mortgage, the amount of outstanding principal at the beginning of the calendar year, and the property's address. This new reporting requirement applies to returns that would be filed in 2017. In response to the legislation, IRS updated Form 1098 Mortgage Interest Statement for the 2017 filing season. While IRS officials told us that they believe the new data to be collected on this form have the potential to be helpful, they will not know the extent of any benefits from this new reporting requirement for several years. Section 151 of division Q of the Consolidated Appropriations Act, 2016 (Public Law 114-113) extended the exclusion of forgiven mortgage debt to debt discharged before January 1, 2017. The Joint Committee on Taxation estimates the cost of this extension will be more than $5.1 billion for fiscal years 2016 and 2017, making it important for IRS to use the additional data we recommended they collect in enforcement efforts.