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Proposed Requirements for Disclosure of Information Concerning Lead-Based Paint in Housing (November 2, 1994)
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24 CFR Part 38 40 CFR Part 745 Lead; Proposed Requirements for Disclosure of Information Concerning Lead-Based Paint in Housing; Proposed Rule DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT [Docket No. R-94-1756; FR-3483-P-01] RIN 2501-AB58 ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 745 [OPPTS-62130; FRL-4637-4] RIN 2070-AC75 Lead; Proposed Requirements for Disclosure of Information Concerning Lead-Based Paint in Housing AGENCIES: Department of Housing and Urban Development (HUD) and the Environmental Protection Agency (EPA). ACTION: Proposed rule. -----------------------------------------------------------------------
DATES: Written comments in response to this proposed rule must be received on or before January 3, 1995. If persons request time for oral comment, EPA and HUD will consider holding an informal hearing in Washington, DC. Requests for oral comment must be received by December 2, 1994. EPA and HUD will decide whether to hold such a hearing by December 19, 1994. The exact date, time, and location of any such hearing will be made available by telephoning EPA's Environmental Assistance Division at the telephone number listed under FOR FURTHER INFORMATION CONTACT. For further information regarding the submission of information claimed as confidential business information (CBI), see Unit XI of this preamble. ADDRESSES: Please submit three copies of all written comments on this joint HUD/EPA proposed rule, including any comments directed specifically to HUD, to: TSCA Document Receipts (7407), Rm. E-G99, Office of Pollution Prevention and Toxics, Environmental Protection Agency, 401 M St., SW., Washington, DC 20460. All comments on this proposed rule should be identified by the docket number OPPTS-62130A. In order to reduce the burden on the commenters, receipt of all comments will be centralized at EPA. FOR FURTHER INFORMATION CONTACT: For general information or to obtain copies of the proposed rule, contact Susan B. Hazen, Director, Environmental Assistance Division (7408), Office of Pollution Prevention and Toxics, Environmental Protection Agency, 401 M St., SW., Washington, DC 20460, Telephone: 202-554-1404, TDD: 202-554-0551. For technical information: At HUD, contact Conrad C. Arnolts, Office of Lead-Based Paint Abatement and Poisoning Prevention, Department of Housing and Urban Development, 451 7th St., SW., Washington, DC 20410, Telephone: (202) 755-1810. At EPA, contact Charles Franklin, Program Development Branch, Chemical Management Division, Office of Pollution Prevention and Toxics, Environmental Protection Agency, 401 M St., SW., Washington, DC 20460, Telephone: 202-260-1781.
SUPPLEMENTARY INFORMATION: I. Authority This proposed rule is issued under the authority of section 1018 of the Residential Lead-Based Paint Hazard Reduction Act of 1992, [42 U.S.C. 4852(d)]. The Residential Lead-Based Paint Hazard Reduction Act is Title X of the Housing and Community and Development Act of 1992, Public Law 102-550. II. Background A. Legal Background In 1992, Congress, recognizing the need to control exposure to
lead-based paint hazards, passed the Residential Lead-Based Paint
Hazard Reduction Act of 1992 (the Act). The main purpose of the
Act was to develop the infrastructure and standards necessary to
reduce lead- This proposed rule is issued under the authority of section 1018
of the Act. Section 1018 requires EPA and HUD to jointly promulgate
regulations for disclosure of lead-based paint or lead-based paint
hazards in target housing which is offered for sale or lease. Target
housing is defined in section 1004(27) of the Act and in Unit V.
of this preamble. Specifically, section 1018 requires: (1) Sellers
or lessors to provide the purchaser or lessee of target housing
with a lead information pamphlet to be developed under section 406(a)
of TSCA; (2) sellers and lessors of target housing to disclose any
known lead- Several related provisions of the Act and of the new Title IV of TSCA, added by section 1021 of the Act, are briefly discussed below to further clarify this proposed rule. The section most closely related to section 1018 is section 406 of TSCA. Section 406(a) directs EPA to develop and publish, after notice and comment, a lead hazard information pamphlet on lead and lead-based paint hazards in the home. EPA has developed the draft pamphlet in consultation with HUD and the Centers for Disease Control and Prevention (CDC), and published a notice in the Federal Register of March 9, 1994 (59 FR 11119), announcing the pamphlet's availability for public review and comment. As required under section 1018 of the Act, the section 406 pamphlet will be given to purchasers and lessees under the EPA/HUD disclosure regulations proposed today. Sections 1004(15), 1004(16), and 1004(17) of the Act generally
define lead-based paint hazards, lead-contaminated dust, and lead-
Therefore, EPA and HUD are soliciting public comment on this proposed rule prior to the availability of proposed or final regulations under section 403. EPA and HUD believe the public has adequate information and opportunity to comment on the contents of this proposed rule and on the relationship between regulations promulgated under sections 1018 and 403 for the following reasons:
(1) While known lead-based paint hazards must be disclosed, this requirement is only one of a number of requirements for which sellers and lessors of target housing are responsible. Therefore, EPA's definition of ``lead-based paint hazards'' does not change the affected population, although that definition has clear implications for the extent of disclosure. (2) The requirements under section 1018 will apply to all target housing regardless of the presence of lead-based paint hazards in that housing. That is, all owners, sellers, and lessors of target housing will be on notice that EPA and HUD are issuing disclosure requirements, and that they will be required to retain and disclose certain types of information and to allow for the 10-day inspection period, regardless of whether their housing contains lead-based paint or a lead-based paint hazard. (3) The Act clearly specifies the requirements of this proposed rule. Therefore, regardless of the standards proposed and issued in the section 403 regulations, EPA and HUD do not have flexibility to change the basic provisions specified by Congress. (4) Section 403, on the other hand, does give EPA flexibility to consider a number of factors in developing health-based standards. Comments specifically concerning the implications of EPA's section 403 standards, given the concrete legislative requirements of section 1018, will be most appropriately addressed by EPA during the development of the section 403 rule. Section 402 of TSCA requires that EPA (in consultation with HUD, the Department of Labor, and the Department of Health and Human Services) promulgate regulations to ensure that individuals engaged in certain lead-based paint activities are trained, that such training programs are accredited, and that contractors engaging in such activities are certified. This section also requires that EPA, in consultation with the above agencies, shall develop standards for performance of lead-based paint activities. Pursuant to section 402, EPA is in the process of developing regulations which would require that detailed reports be written at the completion of any lead inspection or risk assessment, whether voluntary or required. Such reports would have to be disclosed as information known to the seller or lessor under the proposed section 1018 disclosure requirements being proposed today.
B. Lead Background 1. Lead and lead-based paint. Lead is a soft, bluish metallic
element mined from rock and found in its natural state all over
the world. Lead is virtually indestructible, is nonbiodegradable,
and has been known since antiquity for its adaptability in making
various useful items. In modern times it has been used to manufacture
many different products, including paint, batteries, pipes, solder,
pottery, and gasoline. From the turn of the century through the
1940's, paint manufacturers frequently used lead as a primary ingredient
in many oil- 2. Lead hazards. Lead affects virtually every system of the body. While it is harmful to individuals of all ages, lead exposure is especially harmful to children, fetuses, and women of childbearing age. Results of recent studies suggest that lead's adverse effects occur at blood-lead levels previously thought to be safe; in fact, there does not yet appear to be a discernable threshold for the adverse effects of lead on the young (Ref. 3). Lead poisoning has been referred to as ``the silent disease''
because its effects often occur gradually and imperceptibly, showing
no obvious symptoms. Over time, low levels of lead in the bloodstream
can cause learning disabilities, interfere with growth, cause permanent
hearing and visual impairment, and cause other damage to the brain
and nervous system. In large doses, lead can cause blindness, brain
damage, convulsions, and even death. Lead exposure before or during
pregnancy can also affect fetal development and cause miscarriages
(Ref. 3).
III. Purpose The purpose of this proposed rule is to ensure that families are aware of: (1) The existence of lead-based paint or lead-based paint hazards in target housing, (2) the hazards of exposure to lead-based paint, and (3) ways to avoid such exposure before they become obligated to purchase or lease housing that may contain lead-based paint. EPA and HUD are proposing identical rules to appear in both Title 40 of the Code of Federal Regulations (CFR) where other EPA lead rules will appear and in Title 24 of the CFR where other HUD lead rules appear.
Section 1018 of the Act applies to contracts for sale or lease of target housing as defined in section 1004(27) of the Act. Therefore, this rulemaking would apply to virtually all transactions involving a written contract to sell or lease target housing. EPA and HUD have identified the following several specific areas that would be excluded or where coverage would be limited in the proposed rule. A. Foreclosure Sales EPA and HUD have identified both legal and policy reasons to exclude
the sale of properties at foreclosure from the section 1018 requirements.
First, when a property is sold at foreclosure, the sale is conducted
at public auction by or on behalf of a secured lender, and the property
is sold to the highest bidder without any form of arms- For this reason, the lender (or the party conducting the sale for the lender) is often not in a position to provide a potential purchaser with access to the property for a risk assessment or inspection, nor are they usually in possession of information concerning the existence of lead-based paint, as required by section 1018(a)(1)(B). In fact, lenders typically know very little about the history of single-family properties in their portfolios, and these make up the vast majority of the properties being foreclosed. HUD's experience in foreclosure sales suggests that most properties sold at foreclosure are not sold to private investors or people attempting to purchase a residence for themselves. Rather, the secured lender, acting to protect its security for the defaulted loan, is the successful bidder in nearly all foreclosure sales, purchasing the property at auction. When the lender is the purchaser, the lender will typically attempt to recover its investment by selling the property to a third party and, at that point, the protections of section 1018 would clearly apply. B. Informal Rental Agreements Because this proposed rulemaking only applies to transactions to lease housing which involve a written contract, EPA and HUD have concluded that it should not apply to informal rental agreements which do not involve a lease. Such arrangements, by virtue of their informality, make the administration and enforcement of these requirements extremely difficult. To the extent practicable, however, EPA and HUD encourage individuals engaging in such informal arrangements to obtain available information on lead-based paint before occupying target housing. C. Renewals of Existing Leases EPA and HUD do not believe that individuals would significantly benefit from multiple receipt of previously disclosed information during renewals of existing leases and see no justification for placing repetitive disclosure requirements on lessors. For that reason, renewals of existing leases would only be covered by this proposed regulation if the tenant has not previously received the lead-based paint hazard information required under section 1018. If, however, the lessor becomes aware of additional information about the property concerning lead-based paint or lead-based paint hazards during the term of the lease, he or she would be required to disclose this information prior to renewal of the lease. V. Definitions In order to implement section 1018 of the Act, certain terms need to be defined. This section will provide the regulatory definition followed by an explanation of the definition's source. Where possible, EPA and HUD have drawn definitions directly from section 1004 of the Act. In cases where the statute either failed to define terms for the rulemaking or where the definition lacked sufficient detail, EPA and HUD are proposing appropriate definitions, along with an explanation of the reasons for their choices. EPA and HUD are accepting comment on all definitions not taken directly from the statute. Abatement means any set of measures designed to permanently eliminate lead-based paint hazards in accordance with standards established by appropriate Federal agencies. Such term includes: (1) The removal of lead-based paint and lead-contaminated dust, the permanent containment or encapsulation of lead-based paint, the replacement of lead painted surfaces or fixtures, and the removal or covering of lead-contaminated soil; and (2) all preparation, clean up, disposal, and post abatement clearance testing activities associated with such measures. This definition appears in section 1004(1) of the Act. In accordance with the development of standards for the performance of abatements by EPA under section 402 of TSCA, EPA may propose modifications to this definition in a separate proposed rule. If such a revision is proposed, EPA and HUD would consider including the revised definition in the final rule for these requirements. The Act means the Residential Lead-Based Paint Hazard Reduction Act of 1992, Title X of the Housing and Community Development Act of 1992, Pub. L. 102-550. Agent means any party who enters into a contract with a seller or lessor to represent the seller or lessor for the purpose of selling or leasing target housing. This definition is based on the statutory wording of section 1018(a)(4) of the Act, which states that ``Whenever a seller or lessor has entered into a contract with an agent for the purpose of selling or leasing a residential dwelling of target housing, the regulations promulgated under this section shall require the agent, on behalf of the seller or lessor, to ensure compliance with the requirements of this section'' [emphasis added]. This provision clearly identifies an agent as a party who has entered into a contract for the purpose of selling or leasing target housing. State statutory provisions and common law may vary on the topic of real estate contracts and the concept of agency. In response to this diversity in state law, EPA and HUD propose a definition of ``agent'' which does not seek to differentiate various real estate agent activities. The agencies believe that this proposed definition provides necessary flexibility regarding which parties could be defined as ``agents'' who have entered into a contract to sell or lease target housing and, as a consequence, would be covered by the requirements of this regulation. For example, it is EPA's and HUD's understanding that in many states, it is typical for a seller or lessor to enter into a contract to sell or lease target housing with a licensed ``real estate broker,'' who may or may not perform the actual duties of an ``agent'' associated with selling or leasing housing. In these states, individuals working for the licensed broker, typically called ``real estate agents,'' may perform some or all of the duties of an ``agent'' but may be treated as an employee of the broker or independent contractor. If the ``real estate agent'' were to fail to ensure compliance with the requirements of the rulemaking, the broker would assume liability for that failure, just as if the broker had performed all agent duties themselves. In other states, the real estate agent is considered an independent contractor rather than an employee of the broker, and the agent, rather than the broker, is held liable for negligence under common law. Because of these variations in state law, EPA/HUD propose a flexible definition of agent, one that could include broker and/or agent, depending on the particular circumstance. If state law does not recognize the difference between a real estate agent and a real estate broker, the party identified in the contract, and in any subcontract to perform those duties, would be liable for any failure to comply, regardless of whether they were called brokers or agents. Specifically excluded from the requirements of this regulation,
however, would be agents or brokers who operate solely on behalf
of the buyer(s) or lessee(s) and who receive all remuneration from
the buyer/ Common Area means a portion of a building generally accessible to all residents/users including, but not limited to, hallways, stairways, laundry and recreational rooms, playgrounds, community centers, and boundary fences. EPA and HUD are proposing this definition to maintain consistency with the definition of ``common area'' proposed in a separate notice in the Federal Register of March 9, 1994 (59 FR 11108), pursuant to the requirements of section 406 of TSCA. This definition is purposefully broad to allow for its use in other EPA and HUD regulations that might also cover commercial and public buildings. Contract for the purchase and sale of residential real property means any contract or agreement in which one party agrees to purchase an interest in real property on which there is situated one or more residential dwellings used or occupied, or intended to be used or occupied, in whole or in part, as the home or residence of one or more persons.
This definition appears in section 1004(4) of the Act. This definition appears in section 1004(6) of the Act. This definition appears in section 1004(12) of the Act. This definition appears in section 401 of TSCA. Title IV of TSCA was added by the Act, and, given the close relationship between the section 1018 requirements and the provisions of TSCA Title IV, EPA and HUD believe it is consistent to use the Title IV definition for section 1018 purposes. Lead-based paint hazard means any condition that causes exposure
to lead from lead-contaminated dust, lead-contaminated soil, lead-
This definition appears in section 1004(15) of the Act. The exact levels of lead in dust, paint, and soil that would be defined as a hazard will be addressed in a separate rulemaking, mandated by section 403 of TSCA. For the purposes of this rulemaking, however, the statutory definition is sufficient to provide the public with notice to comment on the rulemaking's requirements and structure. Parties who wish to provide comments specifically on what levels of lead in dust and soil (or what conditions or locations of lead-based paint) should be considered a hazard, should do so separately in the section 403 rulemaking process. Lessee means any entity that enters into an agreement to lease or rent target housing, including but not limited to individuals, partnerships, corporations, trusteeships, government agencies, Indian tribes, or nonprofit organizations. This proposed definition is based on the agencies' interpretation of the intent of the Act in identifying individuals entering into a contract to lease target housing. Lessor means any entity that offers target housing for lease, including but not limited to individuals, partnerships, corporations, trusteeships, government agencies, Indian tribes, or nonprofit organizations. This definition is based on the agencies' interpretation of the Act's intent in identifying entities entering into an agreement to lease target housing. Owner means any entity that has legal title to target housing, including but not limited to individuals, partnerships, corporations, trusteeships, government agencies, Indian tribes, or nonprofit organizations. This definition is based on the agencies' interpretation of the intent of the Act relating to owners of target housing. Purchaser means any entity that submits a written offer to purchaser an interest in target housing, including but not limited to individuals, partnerships, corporations, trusteeships, government agencies, Indian tribes, or nonprofit organizations. EPA and HUD are proposing to limit the scope of this regulation to parties that demonstrate a real interest in purchasing target housing, so that sellers or agents representing sellers need not provide all parties who view a property with a 10 calendar-day opportunity to inspect for lead-based paint hazards. This definition is based on the agencies' interpretation of the Act's intent in identifying purchasers of target housing. Residential dwelling means (1) a single-family dwelling, including attached structures such as porches and stoops; or (2) a single-family dwelling unit in a structure that contains more than one separate residential dwelling unit, and in which each such unit is used or occupied, or intended to be used or occupied, in whole or in part, as the residence of one or more persons. This definition is provided in section 1004(23) of the Act. This definition is provided in section 1004(25) of the Act. Seller means any entity that sells an interest in target housing, including but not limited to individuals, partnerships, corporations, trusteeships, government agencies, Indian tribes, or nonprofit organizations. The term seller also includes: (1) An entity which transfers shares in a cooperatively-owned project and (2) an entity which transfers its interest in a leasehold in jurisdictions or circumstances where it is legally permissible to separate the fee title from the title to the improvement. EPA and HUD have proposed this definition to cover the range of entities and arrangements that may be involved in the ``sale'' of target housing and that the agencies interpret to be covered by the Act. The second part of the proposed definition describes sellers who have legal title to the improvements (residential dwellings) on property that is leased from another person. Target housing means any housing constructed prior to 1978, except 0-bedroom dwellings, or housing for the elderly or persons with disabilities (unless any child who is less than 6 years of age resides or is expected to reside in the dwelling). In the case of jurisdictions which banned the sale or use of lead-based paint prior to 1978, the Secretary, at the Secretary's discretion, may designate an earlier date. This definition appears in section 1004(27) of the Act. The Act
excludes housing constructed after 1978 since the allowable lead
in paint was reduced to .06 percent by CPSC after that date (Ref.
1). EPA and HUD interpret the term ``housing for the elderly,'' to mean retirement communities or similar types of housing reserved for persons 62 years of age or older. EPA and HUD request comment on what additional specificity might be necessary for identifying housing for the elderly. EPA and HUD also considered whether Congress meant to include hotels, motels, inns, and other commercial lodging facilities in the term ``housing.'' Most hotels, motels, inns, and other commercial lodging are 0-bedroom dwellings, and would typically be exempt from the requirements of this proposed rule. In addition, EPA and HUD believe it is reasonable to interpret that Congress' intent was to distinguish residential housing from commercial lodging facilities. Specifically, the definition of target housing intended to capture housing designed for long-term or continuous residence, as opposed to lodging facilities offering temporary accommodations. Given the high frequency and short duration of transactions, EPA and HUD believe it is impractical to apply the requirements of this proposed rule to rental transactions in motels, hotels, and other commercial lodging facilities. As directed in the statute, the exclusions for 0-bedroom dwelling, elderly housing, and handicapped housing do not apply to any housing in which children under 6 years old reside or are expected to reside. Similarly, in cases where families with children under 6 might enter into a contract to purchase or lease commercial housing as long-term residences, however, EPA and HUD believe it is consistent with the statute that such establishments be considered target housing under this proposed rule's requirements. 0-Bedroom dwelling means any residential dwelling in which the living area is unseparated from the sleeping area. EPA and HUD are proposing this definition to clarify the term used in the Act's definition of target housing. Under this definition, efficiency, studio apartments, loft space, and single-room dormitory units would be considered 0-bedroom dwellings. VI. Proposed Regulatory Requirements Section 1018 requires EPA and HUD to promulgate joint regulations for disclosure of lead-based paint hazards in target housing which is offered for sale or lease. Specifically, section 1018 requires that before purchasers or lessees become obligated under any purchase or lease contract, sellers or lessors must provide the purchaser or lessee with a lead information pamphlet (being developed by EPA under TSCA section 406) and disclose any lead-based paint or lead-based paint hazards known to the seller or lessor in such housing. In addition, before obligating purchasers under a contract to purchase the housing, sellers must permit purchasers a 10-day period to conduct a risk assessment or inspection for the presence of lead-based paint hazards, and must attach a specific lead warning statement and acknowledgement, signed by the purchaser, to each contract. Violation of Section 1018 may result in civil and criminal penalties, and potential triple damages in a private civil suit. In this unit, EPA and HUD present a more detailed discussion of these requirements as proposed in the EPA and HUD regulations. As noted above, EPA and HUD are proposing joint and equivalent regulations that would appear in Title 40 of the CFR with other EPA lead regulations and in Title 24 of the CFR with other HUD lead regulations. Including the joint regulations in both CFR locations will help ensure that sellers, lessors, agents, buyers, and lessees are informed of their existence. A. Disclosure Requirement Section 1018(a)(1)(B) of the Act requires the seller or lessor of target housing to provide all information known to the seller or lessor on lead-based paint and lead-based paint hazards in the housing to the purchaser or lessee before the purchaser or lessee is obligated under any contract to purchase or lease target housing. EPA and HUD are proposing such a disclosure requirement in 24 CFR 38.20 and 40 CFR 745.107. Under the proposed regulations, the seller or lessor, or the agent acting on behalf of the seller or lessor, is required to provide the purchaser or lessee with written documentation of all information known to the seller or lessor, or the agent regarding the presence of lead-based paint or lead-based paint hazards associated with the housing being sold or leased. Consistent with the statute, records of this information must be provided to the purchaser or lessee before they become obligated under any contract to purchase or lease the target housing. For the purposes of this proposed rule, EPA and HUD propose that ``information known to the seller or lessor'' comprise, at minimum, the information described in 24 CFR 38.20 and 40 CFR 745.107 of these regulations. The proposed information would include, but not be limited to, the following items: 1. Reports from all lead-based paint inspections, risk assessments, and abatement activities known to the seller or lessor and conducted on or in the target housing, including any known reports completed before the effective date of the final rule if such reports are available to the seller or lessor on or after the effective date. Section 1018(a)(1)(B) requires sellers or lessors of target housing to ``provide to the purchaser or lessee any lead hazard evaluation report available to the seller or lessor.'' EPA and HUD recognize that reports from some lead-based paint activities conducted before the effective date of the final rule may no longer be available to the seller or lessor given that the seller or lessor had not been put on notice that disclosure of such records would be required. However, those reports in the possession of the seller or lessor on or after November 2, 1994 would become part of the permanent record for that unit of target housing. 2. Records of lead-based paint inspections, assessments, and abatement
activities conducted for current or past sellers or lessors in common
areas of target housing containing more than one residential dwelling.
EPA and HUD are concerned that lead-based paint in common areas
may pose an additional exposure risk to occupants, especially in
buildings where lead-based paint chips and dust are allowed to accumulate.
Also, the presence of lead-based paint in common areas of buildings
containing target housing may signal the presence of lead- 3. Information known to the seller or lessor regarding whether
other residential dwellings in the target housing contain or have
contained lead-based paint or lead-based paint hazards. This would
only apply to target housing containing more than one residential
dwelling, and would be of primary value in cases where information
on lead-based paint and lead-based paint hazards only exists for
some, but not all residential dwellings. The presence of lead-based
paint in some of the residential dwellings may suggest a greater
likelihood of lead-based paint existing in the residential dwellings
that have yet to be tested. EPA and HUD believe that such information will help potential occupants make more informed decisions when considering leasing or purchasing target housing. For example, such information could persuade purchasers to exercise their option to conduct an inspection or risk assessment before purchasing the property. Similarly, knowledge of lead-based paint on the premises could prompt lessees to take greater precautions to guard against exposure. EPA and HUD request comment on whether requiring disclosure of information regarding other residential units is warranted and, if so, whether a more stringent disclosure standard is needed. 4. Other available information that may indicate lead-based paint or a lead-based paint hazard in the unit. This proposed requirement is directed at other relevant information on lead-based paint hazards that may be known by the seller or lessor. EPA and HUD request information and comment on other appropriate information that may be commonly available to owners of target housing and which should be itemized in the final rule. For example, should information on past cases of lead-poisoning of occupants be disclosed to purchasers or lessees? If such information is to be considered, what level of detail would be appropriate given the privacy implications of medical records? In addition, EPA and HUD request comment on whether the final rule should impose specific recordkeeping requirements on owners of target housing to retain information known to the owner on lead-based paint and lead-based paint hazards, as identified in proposed 24 CFR 35.20 and 40 CFR 745.107. If promulgated, the time period for such a recordkeeping requirement for owners of target housing could range in length from the length of ownership to a discrete number of years (3 years, 5 years, 10 years, etc), based on its feasibility and utility in ensuring compliance with the regulations. In evaluating the value of an owner record retention requirement, EPA and HUD will consider its potential value both in aiding and supporting Agency enforcement efforts as well as its potential value in supporting civil actions for damages taken under section 1018(b)(3). B. Lead-Hazard Information Pamphlet Section 1018(a)(1)(A) requires that sellers and lessors of target housing provide the purchaser or lessee with a copy of the EPA pamphlet Lead Paint: Protect Your Family before the purchaser or lessee is obligated under any contract to purchase or lease the housing. A primary function of the pamphlet is to educate families on the potential health risks associated with lead exposure and ways to avoid such exposure. By requiring that families receive the pamphlet at the beginning of the real estate transaction, Congress ensured that families would be informed about lead-based paint issues during the transaction process. Therefore, the joint provisions of these regulations (located in Secs. 38.20(a) and 745.107(a) of the proposed regulatory text) would require that purchasers and lessees receive the pamphlet before becoming obligated under any contract. The draft pamphlet was developed by EPA in consultation with HUD and CDC and was released to the public for a 60-day comment period and announced in the Federal Register of March 9, 1994, (59 FR 11119). In addition, EPA has conducted a series of focus tests and interviews in different regions of the country to ensure that the pamphlet meets both high technical and editorial standards. The final pamphlet will be made available to the public through the Government Printing Office (GPO) for a nominal fee. In addition, EPA will make a limited number of camera-ready copies of the final pamphlet available to organizations that wish to print copies for private distribution, and the pamphlet will be available in electronic form through the GPO Bulletin Board. EPA and HUD are continuing to explore methods for printing and distributing the pamphlet in a quick and inexpensive way to the regulated community and the general public at large. EPA and HUD welcome comment on other potential distribution methods for the pamphlet. C. Disclosure and Acknowledgment Form In addition to requiring written documentation of the information
known by the seller or lessor, defined in proposed 24 CFR 38.20(b)
and 40 CFR 745.107(b) of the regulatory text, EPA and HUD have developed
disclosure and acknowledgement forms to be attached to all sales
and leasing contracts for target housing. Form A for sellers and
Form B for lessors are included as Appendix A to the proposed HUD
regulatory text. EPA and HUD believe that the forms will help ensure
that (1) All information known to the seller or lessor on lead-based
paint and lead- For the reasons discussed above, EPA and HUD are proposing in Secs. 745.107(a)(4) and 38.20(a)(4), respectively, that each contract to sell property defined as target housing contain a signed and dated copy of the joint HUD/EPA form entitled Disclosure and Acknowledgement of Lead-Based Paint Before Sale. The form is divided into four distinct parts: a general notice statement, a certification of compliance statement by the seller, a certification of compliance statement by the agent (where applicable), and an acknowledgement statement by the purchaser. Each part is discussed below. a. Notice to purchasers of target housing. Section 1018(a)(3) of the Act provides a specific ``lead warning statement'' to be included in all contracts involving the purchase and sale of any interest in target housing. The statute states that the lead warning statement shall contain the required language printed in large type on a separate sheet of paper attached to the contract. Because the disclosure and acknowledgement form would serve as an attachment to the contract, EPA and HUD propose to include this lead warning statement as the first part of the form, and to print it in a larger type than the rest of the form to ensure its prominence. The required text would read:
In addition, EPA and HUD propose that, in cases where the sales contract is written in a language other than English, the lead warning statement must be included in the language of the contract as well, based on a translation of the English-version lead warning statement. While this is not expressly required by the statute, such a requirement would be consistent with Congress' intent of ensuring that families be fully aware of the potential hazards of lead-based paint before purchasing target housing. EPA and HUD request comment on this proposed requirement. b. Certification of compliance statement by the seller. The second part of the form would require the seller to list all information known to the seller on lead-based paint and lead-based paint hazards in the target housing. EPA and HUD believe that it is necessary to create a single record of the information provided by the lessor/owner. Completion of this part would ensure that at the time of the contract agreement, both the seller and the purchaser would be aware of the disclosure requirements under these regulations and the lead-based paint hazard information being disclosed. If information described in Part II of the form is in the possession of the seller, the seller would be required to provide the information in written form to the purchaser, check the appropriate box, and note the dates and type of known information in the space provided. This information would be a necessary record during the disclosure process, both to inform the purchaser of the information the purchaser should have received, and as a later measure of compliance by the seller and the seller's agent. c. Certification of compliance statement by the agent. The third part of the form would require an agent, if one is used, to certify that the requirements of section 1018 have been satisfied, either by the seller or by the agent. d. Acknowledgement of lead-based paint requirements in target housing by the purchaser. Section 1018(a)(2) requires that contracts to purchase target property include an acknowledgement signed by purchasers. EPA and HUD propose that the purchaser indicate the following in the acknowledgement: That they have read and understood the lead warning statement, received any information on lead-based paint and lead-based paint hazards noted in the seller certification, received a lead hazard information pamphlet, and that they are aware that they must receive an opportunity for a 10-day inspection period before becoming obligated under a contract to purchase the property. In the fourth part of the form, EPA and HUD propose such an acknowledgement. The acknowledgement would state: I acknowledge that I have read and understood the attached lead warning statement in Part I of this form, received the information noted in Part II of this form, received the lead hazard information pamphlet Lead-Based Paint: Protect Your Family. In addition, I acknowledge that, pursuant to 42 U.S.C. 4852(d) and its implementing regulations, the attached contract entitles me to up to 10 calendar days to conduct a risk assessment or inspection for the presence of lead-based paint hazards before becoming obligated under a contract to purchase, unless I agree otherwise in writing. 2. Form for Transactions to Lease Target Housing EPA and HUD are proposing in Secs. 745.107(a)(5) and 38.20(a)(5), respectively, that each contract to lease target housing contain a signed and dated copy of the joint HUD/EPA form entitled Disclosure and Acknowledgement of Lead-Based Paint Before Lease. The form is divided into four distinct parts: a general notice statement, a certification of compliance statement by the lessor, a certification of compliance statement by the agent (where applicable), and an acknowledgement statement by the lessee. Each part is discussed below; however, where statutory justifications and background are the same as that presented in the part on the form for sales of target housing, the repetitive elements have been omitted. a. Notice to residents of target housing. EPA and HUD propose to include a tailored lead warning statement as the first part of the form, and to print it in a larger type than the rest of the form to ensure its prominence. Although not specifically required by section 1018, EPA and HUD believe that this statement provides a useful context for information disclosed to lessees, just as for purchasers, concerning the hazards of lead-based paint. The required text would read: A residential structure built prior to 1978 may present exposure to lead from lead-based paint. This exposure may place young children at risk of developing lead poisoning. Lead poisoning in young children can produce permanent neurological damage, including learning disabilities, reduced intelligence quotient, behavioral problems, and impaired memory. Lead poisoning also poses a particular risk to pregnant women. The lessor of any residential dwelling is required to provide the lessee with any information on lead-based paint hazards from risk assessments or inspections in the lessor's possession and notify the lessee of any known lead-based paint hazards. In addition, EPA and HUD propose that, in cases where the lease is written in a language other than English, a translation of this lead warning statement would be required to be attached in the language of the contract. EPA and HUD believe that this translation requirement may be even more critical in the case of leasing transactions than in purchases as many non-English speakers may be more likely to lease housing for themselves and their families. EPA and HUD request comment on this proposed requirement. b. Certification of compliance statement by the lessor. The second part of the form would require the lessor to list all information known to the lessor on lead-based paint and lead-based paint hazards in the target housing. If information listed in Part II of the form is in the possession of the lessor, the lessor would be required to provide it in written form to the lessee, check the appropriate box, and note the dates and type of known information in the space provided. c. Certification of compliance statement by the agent. The third part of the form would require an agent, if one is used, to certify that the requirements of section 1018 have been satisfied, either by the lessor or by the agent. d. Acknowledgement of lead-based paint requirements in target housing by the lessee. The fourth part of the form consists of an acknowledgement by the lessee that the necessary disclosure steps, as required by section 1018(a)(1), had been performed. The acknowledgement language reads: I acknowledge that I have read and understood the attached lead warning statement in Part I of this form, received the information noted in Part II of this form and received the lead hazard information pamphlet Lead Paint: Protect Your Family 3. Request for Comment on the Forms EPA and HUD request comments on all aspects of the disclosure and acknowledgement forms. Specific questions include: Are the forms effective in communicating the importance of lead-based paint hazard awareness and the rights of purchasers and lessees? Is there other information that should be included on the forms? Is some of the included information that is not required by the statute unnecessary? 4. Retention of Disclosure and Acknowledgment Form The disclosure and acknowledgement form documents the fulfillment of the mandated disclosure requirements during the sale or lease of target housing. This record, if maintained by the seller or lessor after the completion of the transaction, would provide a valuable record of the fulfillment of these requirements to both the agencies and courts. If this record were not regularly maintained, EPA and HUD are concerned that they would have little ability to determine whether the necessary disclosure steps had occurred. For that reason, proposed Secs. 38.20 and 745.107 of the regulatory text would require that the signed notice and disclosure form be maintained by sellers, lessors, and agents for a full 3 years from: (a) The commencement of the lease period in the case of a transaction to lease target housing, or (b) the completion of the sale in the case of a sale of target housing. EPA and HUD chose 3 years as the retention period for the disclosure form in order to allow adequate time for enforcement action by HUD or EPA. If the regulation were to mandate a shorter period of time, Federal enforcement actions could be hampered, undermining the efficacy of the regulations mandated by statute. EPA and HUD are concerned that requiring a longer retention period would place an undue burden on the regulated community. EPA and HUD have not identified any less burdensome alternative to support compliance monitoring and enforcement actions but are sensitive to the need to impose minimum recordkeeping burdens on the regulated community, especially given the large number of transactions affected. The agencies are willing to consider alternatives to the proposed requirements, including the reduction or omission of recordkeeping requirements, if the alternatives would still ensure the successful administration and enforcement of the provisions of section 1018 of the Act. Such alternatives could include the imposition of a longer or
shorter retention period for the disclosure form, or the addition
or substitution of other records as part of a post-transaction recordkeeping
requirement. EPA is also considering the potential efficacy of instituting
recordkeeping requirements with a sunset provision, which would
phase them out over time as the market increasingly embraced and
institutionalized the disclosure process. D. 10-Day Inspection Period EPA and HUD interpret the term ``10-day period'' to mean 10 calendar days. While the seller and purchaser may mutually agree to a shorter or longer period, without written proof of an agreed upon change to the time, the legally enforceable period would remain 10 calendar days. Given the diversity of definitions for ``business'' or ``working'' days, EPA and HUD believe that an alternative interpretation of the 10-day period would lead to confusion among the public. In cases where a 10 calendar-day inspection or assessment period would be insufficient, the purchaser would retain the option of negotiating in writing for a longer period. Since known lead-based paint information may affect a purchaser's decision to utilize the 10-day inspection period option, EPA and HUD propose to require that sellers perform and document all disclosure activities required under this proposed rule before providing the purchaser with the opportunity for the 10-day period. EPA and HUD believe that the purchaser will be most able to determine whether a risk assessment or inspection is necessary or appropriate after receiving the disclosed information. EPA and HUD also believe that reports from inspections conducted during the 10-day inspection/assessment period should become part of the permanent record retained by the owner of the housing. Therefore, EPA and HUD are also requesting comment on whether purchasers who conduct inspections or risk assessments during the 10-day period but who do not ultimately purchase the housing should be required, under this rulemaking, to provide a copy of any report to the owner for their records. Some purchasers and sellers may prefer to conduct the 10-day inspection/assessment period before the parties have signed a contract for the purchase and sale of the target housing. Others may prefer to conduct the inspection period after the contract is signed. In implementing these requirements, EPA and HUD have considered several approaches to fulfilling the statutory provision that the purchaser receive the opportunity for a 10-day inspection period before becoming obligated under a contract to purchase the housing. These regulations propose several approaches to Federal implementation of the 10-day inspection period. Option 1. Require Contract Language Addressing Outcome of Inspection (Preferred Option) To insure that the purchaser receives the statutorily required
10- Option 2. Base Regulatory Text on Statutory Language The least prescriptive option for implementing section 1018(a)(1)(C) requirement for a 10-day inspection opportunity is to state in the regulation simply that ``the seller shall provide the purchaser with an opportunity for a 10-day inspection period (unless the parties agree to a mutually agreed upon different period of time) before becoming obligated under the contract to purchase the housing to conduct a risk assessment or inspection for the presence of lead-based paint hazards.'' While this option would provide the regulated community with flexibility in determining how to comply, EPA and HUD are concerned that the lack of detail would provide inadequate guidance to the regulated community, regarding the measures needed for proper compliance. Option 3. Mandate Specific Contingency Language for All Contracts Completed Before Inspection or Assessment Period EPA and HUD are considering the merit of requiring that all contracts
to purchase target housing include specific language mandated by
HUD and EPA addressing the purchaser's opportunity for a 10-day
inspection period. In addition to further informing the purchaser
of his/her rights to the inspection/assessment period, EPA and HUD
could provide specific language addressing the rights of the purchaser
in cases where the inspection/assessment period was provided after
the purchaser had signed a contract to purchase the target housing.
These requirements have the advantage of providing a clear message
regarding what the seller and agent must do to comply and regarding
what rights the purchaser has in cases where the purchaser does
not receive the inspection or assessment period until after having
signed a contract. EPA and HUD also requests comment on requiring that the 10-day
opportunity for inspection or assessment be provided before the
purchaser signs a contract for the purchase of target housing. This
would ensure that all purchasers were aware of the presence of any
lead-based paint and lead-based paint hazards before they entered
into the contract to purchase the housing. EPA and HUD do not currently
prefer to impose such a prescriptive requirement on the real estate
community; however, recognizing that both purchasers and sellers
may prefer, at times, to implement the inspection period after all
parties have acknowledged serious interest in completing the transaction.
E. Role of Agent As set forth in section 1018(a)(4) of the Act, agents entering into a contract with a seller or lessor to sell or lease target housing must ensure compliance with all requirements imposed upon the seller or lessor under section 1018. If the sale or lease of target housing was aided or accomplished by an agent who has entered into a contract with a seller or lessor, the agent can be held liable for their failure to comply with the requirements of section 1018 and the regulations and can be liable for all penalties, both criminal and civil. EPA and HUD propose to impose an affirmative obligation on agents
to advise the seller of the provisions of the rule, including the
seller's obligation to inform the agent of lead-based paint or lead-
As a method for demonstrating compliance, EPA and HUD have proposed a requirement that agents sign and maintain copies of the signed notice and disclosure forms from each sale or lease of target housing. As proposed for sellers and lessors, the agent would have to maintain these records for 3 years from the commencement of the leasing period or for 3 years from the completion of the sale. In determining an appropriate recordkeeping requirement, EPA and HUD considered both the burden on the regulated community and the information and duration necessary to ensure adequate compliance monitoring and enforcement of the rule's provisions. EPA and HUD rejected the ``no-recordkeeping requirement'' for agents because it would hinder Federal compliance assurance activities and make it difficult to determine whether a disclosure had taken place. Similarly, a recordkeeping requirement of less than 3 years would provide inadequate time for inspection of records and initiation of appropriate enforcement actions. If no agents were employed during the leasing or purchasing process, then all liability for failure to adhere to the proposed requirements would rest solely with the seller or lessor. EPA and HUD request comment on the rule's proposed definition of agent (see Unit IV of the preamble and Secs. 38.15 and 745.103 of the regulatory text) and on the interpretation of their compliance assurance provision in section 1018(a)(4). F. Effective Date Section 1018(a)(1) of the Act directs EPA and HUD to jointly issue these requirements as final regulations by October 28, 1994, and pursuant to section 1018(d), the regulations will take effect on October 28, 1995. Although section 1018 specified that final regulations should be promulgated no later than October 28, 1994, EPA/HUD will not be able to meet this deadline. It appears that Congress' intent in section 1018 was to provide a year between the promulgation of the final rule, and the effective date of the rule. Congress reasonably could have felt that this year was necessary in order that the real estate industry, landlords, sellers, etc. could become familiar with the rule requirements and set up procedures for compliance. For this reason, EPA/HUD believe that the effective date of the rule should be no early than 1 year after promulgation of the final rule, even if this means occurring later than October 28, 1995, as mandated by section 1018. EPA and HUD believe that this interpretation is the one most consistent with Congressional intent. VII. Non-Compliance and Penalties In addition to civil liability under section 1018(b)(3), section 1018 provides both EPA and HUD with other enforcement authority for these requirements. The enforcement authority is discussed below.
Section 1018(b)(1) of the Act authorizes HUD to impose civil monetary penalties on any person who knowingly violates section 1018. HUD interprets this authority to apply to violators of the regulations under section 1018 as well. HUD shall impose penalties under section 102 of the Department of Housing and Urban Development Reform Act of 1989 [42 U.S.C. 3545]. These penalties may be up to $10,000 for each violation. In addition, section 1018(b)(2) of the Act authorizes the Secretary of HUD to ``take such lawful action as may be necessary to enjoin any violation'' of the rule's provisions. Section 1018(b)(5) provides that any violation of section 1018 will be a violation of section 409. Section 412(a) of TSCA provides that the U.S. district courts have jurisdiction to restrain any violation of section 409 of TSCA. Thus, the district courts will have jurisdiction over violations of section 1018. B. EPA Authority 1. Civil Section 1018(b)(5) of the Act provides that failure or refusal
to comply with section 1018 or its implementing regulations is a
violation of TSCA section 409. Violations of TSCA section 409 are
subject to TSCA section 16 penalties. Thus, a violator of section
1018 will be subject to penalties under TSCA section 16 of up to
$10,000 for each violation. Since TSCA section 16 includes violations under section 409, TSCA section 16(b) provides that any person who knowingly or willfully violates section 409 (and thus section 1018) would, in addition to or instead of any civil penalty, be subject, upon conviction, to a fine of not more than $10,000 for each day of violation or to imprisonment for not more than 1 year, or both. As violations of each provision can only occur one time during each transaction (as opposed to on a daily basis), the $10,000 penalty may be interpreted as ``for each violation.'' C. Civil Liability In addition to the EPA and HUD enforcement authority for the provisions of this proposed rule, under section 1018(b)(3) of the Act, ``Any person who knowingly violates the provisions of this section shall be jointly and severally liable to the purchaser or lessee in an amount equal to 3 times the amount of damages incurred by such individual.'' This provision allows the purchaser or lessee to seek direct compensation for any damages incurred based on the seller or lessor's noncompliance. Section 1018(b)(4) authorizes the court to award court costs, reasonable attorney fees, and expert witness fees to the plaintiff if the plaintiff prevails. D. Validity of Contracts and Liens Section 1018(c) provides that nothing in section 1018 (or implementing
rules) shall affect the validity or enforceability of any sale or
contract for the purchase and sale or lease of any interest in residential
real property or any loan, loan agreement, mortgage, or lien, made
or arising in connection with a mortgage loan.'' It also provides
that nothing in section 1018 (or its implementing rules) shall ``create
a defect in title.'' EPA and HUD have looked at section 1018(c)
in the context of other section 1018 provisions, which outline specific
clauses which must be attached to contracts for the purchase and
sale of target housing, and specific procedural protections which
must be given to the purchaser/lessee. EPA and HUD interpret section
1018 as a whole to provide that, once the contract is ratified,
if certain attachments are not included in the ratified contract
and if certain protections afforded in section 1018 were not given
to the lessee/purchaser, the remedy available to the purchaser or
lessee under section 1018 against the seller or lessor would be
monetary damages. VIII. Procedures for Requesting a Public Hearing The Act mandates Federal involvement in housing transactions at an unprecedented level. Recognizing the broad scope of these provisions, EPA and HUD will consider holding an informal hearing for public comment on this proposed rule in Washington, DC. To ensure adequate preparation for the hearing by all parties involved, persons or organizations desiring to participate in an informal hearing must file a written request for a hearing or to participate in any such hearing. The written request must be sent to the Environmental Assistance Division at the address listed under FOR FURTHER INFORMATION CONTACT. The written request to participate must include: (1) A brief statement of the interest of the person or organization in the proceeding; (2) a brief outline of the points to be addressed; (3) an estimate of the time required; and (4) if the request comes from an organization, a non-binding list of the persons to take part in the presentation. The request must be received by December 2, 1994. Should a hearing be held, organizations are requested to bring with them, to the extent possible, employees with individual expertise in and responsibility for each one of the areas to be addressed. Organizations which do not file written comments in response to the proposed rule will not be allowed to participate at the hearing. IX. Summary of Regulatory Impact Analysis EPA has prepared a Regulatory Impact Analysis (RIA) examining the potential costs, benefits, and impacts of regulations for the disclosure of lead-based paint hazards in residential property upon the transfer of the property for sale or rental. The analysis is presented in five sections: <bullet> Framework for Analyzing the Costs of the Lead-Based Paint Hazard Disclosure Rule for Real Estate Transfers <bullet> Profile of Sectors Affected by the Lead-Based Paint Hazard Disclosure Rule for Real Estate Transfers <bullet> Estimated Costs to Private Parties from the Lead-Based Paint Hazard Disclosure Rule for Real Estate Transfers <bullet> Effect of the Lead-Based Paint Hazard Disclosure Rule for Real Estate Transfers on Small Businesses-Initial Regulatory Flexibility Analysis <bullet> Assessment of the Benefits of the Lead-Based Paint Hazard Disclosure Rule for Real Estate Transfers. 1. Framework for Analyzing the Costs of the Lead-Based Paint Hazard Disclosure Rule for Real Estate Transfers Those parties directly affected by the proposed rule are the seller, lessor, agent, property manager, buyer, and tenant. EPA found the required activities which give rise to regulatory burden imposed on the affected parties to fall into four categories for cost estimation purposes: <bullet> Start-up costs, which include learning the rule's requirements and establishing compliance procedures. <bullet> Disclosure activities, which refers to the costs resulting from the actual transfer of information and obtaining of needed signatures. <bullet> Recordkeeping, which results from the requirement that signed acknowledgement forms must be retained by the provider of the information. <bullet> Materials, which are linked primarily to the disclosure requirement, as the lead hazard information pamphlet must be purchased or photocopied (acknowedgement forms must also be duplicated). Costs may also be incurred for filing where a high number of acknowledgement forms are generated (e.g., agents), though such burden was estimated to be quite modest. The requirements of section 1018 of the Act fall primarily on the seller or lessor of ``target housing,'' which is defined to be any housing constructed prior to 1978, except housing for the elderly or persons with disabilities (unless any child who is less than 6 years of age resides or is expected to reside in such housing) or any 0 bedroom dwelling. However, if an agent or property manager acts on behalf of the seller or lessor, which EPA has estimated to be the case in the great majority of transfers, the responsibilities fall to such agents or managers. To estimate the cost impacts of the proposed rule, data were sought
pertaining to the number of affected parties in each classification
listed above, the frequency with which affected purchase and lease
transactions are completed, and the incremental costs, in labor
and materials, added to each transaction by the proposed regulations.
The larger of the two affected sectors expected to bear the principal effects of the proposed rule falls within Standard Industrial Classification (SIC) code 651, Real Estate Operators and Lessors. EPA estimates there to be 96,000 establishments potentially affected by the proposed rule. Also affected are business establishments falling within SIC code 653, Real Estate Agents and Managers; an estimated 72,000 establishments could be affected by the proposed rule. Employment data for these industries were obtained for occupations most likely to be involved in transactions subject to the rule. EPA estimates that 339,000 real estate agents and 225,000 property managers will be affected. With regard to transaction volume, EPA found that 2.9 million sales transactions and 9.3 million rental transactions occur annually in target housing. 3. Estimated Costs to Private Parties from the Lead-Based Paint Hazard Disclosure Rule for Real Estate Transfers Table 1 below presents a summary of the estimated annual compliance
costs associated with the proposed rule. Each of the four cost categories
appearing in the table are discussed briefly below. As is evident from Table 1 below, disclosure event costs constitute the greatest portion of overall costs. Factors affecting the magnitude of these costs include the frequencies of regulated events; the time involved in performing required activities, such as providing the prospective purchaser/tenant with the required information and obtaining the required signatures; and the hourly compensation of all involved parties. EPA also took into account the fact that a number of States have similar requirements pertaining to information transfer regarding potential lead hazards in the sale of residential property. Thus, an allowance was made in the burden estimates for transactions occurring in such States to reflect a certain level of current compliance.
Recordkeeping and materials costs comprise a relatively modest
share of overall annual costs. Factors affecting the magnitude of
these cost items include the number of affected parties per transaction;
the frequency of transactions, the costs of acquiring/duplicating
documents, which include the lead hazard information pamphlet and
signed acknowledgement forms; and costs to maintain documents. EPA investigated the potential impacts of the proposed rule on small businesses, and has prepared an Initial Regulatory Flexibility Analysis (IRFA). While a large number of small establishments will be potentially affected by the rule, cost impacts were not found to be of sufficient magnitude to cause undue harm to such establishments. Consequently, no regulatory alternatives are being proposed in connection with small business impacts. The IRFA is summarized separately below in Unit XI.C of this preamble. 5. Assessment of the Benefits of the Lead-Based Paint Hazard Disclosure Rule for Real Estate Transfers The market imperfection that the proposed rule is intended to
correct is the lack of information available to prospective home
buyers and renters on lead-based paint hazards in homes they may
be considering for purchase or rent. Under the proposed rule, general
information about risks associated with lead-based paint will be
provided (through the provision of a brochure) and, when available,
information about the presence of or abatement of lead in the specific
unit being considered for purchase or rent must also be disclosed
(e.g., information concerning previous testing for the presence
of lead-based paint, abatement history, evidence of previous poisoning,
etc.). The failure of the marketplace to provide this information
or to provide prospective home buyers and renters the opportunity
to develop such information means that prospective buyers and renters
might purchase or lease a property, or make pricing or rental payment
decisions regarding properties, without understanding possible lead-
EPA and HUD expect that this rulemaking will generate benefits
by providing prospective home buyers and renters access to information
which they otherwise may not have been able to acquire, such as
information pertaining to abatement activities for a specific residence,
or, in the case of more general information, which they may have
been able to acquire only through their own effort at some cost.
In addition, EPA believes the information will generate health benefits
by leading many buyers and renters to modify their behavior in a
way that will reduce risks from lead-based paint. For example, purchasers
could undertake abatement activities subsequent to taking ownership
of a dwelling, change household cleaning practices, or request professional
assistance when undertaking renovation activities. The proposed
rule may also prompt property owners, due to reluctance on the part
of prospective buyers/renters to select housing containing lead-
EPA and HUD note that the regulation does not require actions to be taken to reduce lead-based paint hazards in residential housing; thus, the extent to which health benefits accrue depends upon how transaction participants, that is, sellers/lessors and prospective buyers/renters, value and respond to the additional information. In the RIA, three approaches are detailed that are evolving and can be seen as a starting point in an effort to expand the level of understanding of how benefits from information products can be valued. However, an information base and the associated accepted analytic methods necessary to predict consumer reaction to information products on lead-based paint hazards are not readily available; thus, quantifying the expected benefits of this proposed rule would be extremely difficult. Given the high level of uncertainty associated with the results from such a quantitative analysis, and given the prescriptive nature of section 1018 of the Act, EPA and HUD believe that the information provided in the qualitative analysis presented in the RIA served to inform decisionmaking. EPA invites comment, however, on its benefits analysis and on alternative approaches to assessing the benefits of the proposed rule. X. Confidential Business Information While EPA and HUD do not anticipate the receipt of much (if any) confidential business information (CBI) in connection with this rulemaking, a person may assert a claim of confidentiality for any information, including all or portions of written comments, submitted in connection with the proposed rule. Any person who submits a comment subject to a claim of confidentiality must also submit a nonconfidential version. Any claim of confidentiality must accompany the information when it is submitted. Persons must label information claimed as confidential by circling, bracketing, or underlining it, and marking it with ``CONFIDENTIAL'' or some other appropriate designation. A determination of whether information will be disclosed will be made pursuant to the Freedom of Information Act. If a person does not assert a claim of confidentiality for information in comments at the time they are submitted to EPA, EPA will place the information in the public record for this rulemaking without further notice to that person.
A record for this proposed rule has been established under docket
number ``OPPTS-62130.'' The public version of this record (which
does not contain any information claimed as CBI) is available for
inspection from noon to 4 p.m., Monday through Friday, excluding
legal holidays. The public record is located in EPA's TSCA Nonconfidential
Information Center (NCIC), Rm. NE-B607, 401 M St., SW., Washington,
DC 20460. The draft of the proposed rule submitted by EPA and HUD to the
Office of Management and Budget (OMB) for review prior to proposal
will also be contained in the docket. The drafts of the final rule
submitted for review before promulgation will be placed into the
docket as well. 3. HUD, Comprehensive and Workable Plan for the Abatement of Lead-
4. HUD, Office of Lead-Based Paint Abatement and Poisoning Prevention. Lead-Based Paint; Interim Guidelines for Hazard Identification and Abatement in Public and Indian Housing; Notice. [55 FR 14556, April 18, 1990]. 5. DOL, OSHA, Lead Exposure in Construction; Interim Final Rule. Federal Register [58 FR 26590, May 4, 1993). 6. EPA, Draft: Reducing Exposure to Lead in The Home; An Action Guide For Families. (January 1992). 7. HUD, Lead-Based Paint: A Threat to Your Children. U.S. GPO: 1993-351-568. January 1993. 8. EPA, Lead Poisoning and Your Children. EPA/800-B-920002, September 1992. 9. HHS, PHS, CDC, Preventing Lead Poisoning in Young Children;
A Statement By the Centers for Disease Control. October 1991. 11. HHS, PHS, ATSDR, The Nature and Extent of Lead Poisoning in Children in the United States: A Report to Congress. July 1988.
XII. References 1. CPSC, ``Notice Reducing Allowable Levels of Lead in Lead-Based
Paint. Federal Register. [42 FR 44199, September 1, 1977]. 3. HHS, PHS, CDC, Preventing Lead Poisoning in Young Children;
A Statement By the Centers For Disease Control. October 1991, pp.
7-10. XIII. Regulatory Assessment Requirements A. Executive Order 12866 Under Executive Order 12866 (58 FR 51735, October 4, 1993), the agency must determine whether the regulatory action is ``significant'' and therefore subject to review by the Office of Management and Budget (OMB) and the requirements of the Executive Order. Under section 3(f), the order defines a ``significant regulatory action'' as an action that is likely to result in a rule (1) Having an annual effect on the economy of $100 million or more, or adversely and materially affecting a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or significant''); (2) creating serious inconsistency or otherwise interfering with an action taken or planned by another agency; (3) materially altering the budgetary impacts of entitlement, grant, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raising novel legal or policy issues arising out of legal mandates, the Presidents priorities, or the principles set forth in this Executive Order. Pursuant to the terms of this Executive Order, it has been determined that this proposed rule is a ``significant regulatory action'' because it is raising novel policy issues arising out of its legal mandate. As such, this action was submitted to OMB for review, and any comments or changes made in response to OMB suggestions or recommendations have been documented in the public record.
The Regulatory Flexibility Act of 1980 requires each Federal agency to perform a Regulatory Flexibility Analysis for all rules that are likely to have a ``significant impact on a substantial number of small entities.'' In an effort to identify and characterize the proposed rule's effects on small business, EPA and HUD have prepared an Initial Regulatory Flexibility Analysis (IRFA). This assessment has been included as part of the RIA, and is summarized below. In preparing the IRFA, EPA and HUD first developed an establishment profile for each major sector (SIC 651 and SIC 653). This profile indicated that approximately 75 percent of all establishments in SIC 651 (Real Estate Operators and Lessors) and approximately 71 percent of all establishments in SIC 653 (Real Estate Agents and Managers) fell within the 1 to 4 employee size class. These proportions increased to 90 percent and 86 percent, respectively, when employee size class 1 to 9 was examined. To measure the cost impacts of the proposed rule on these small establishments, representative, or model establishments were designed. These model establishments corresponded to typical establishments, with respect to number of employees and annual transaction volume, in each affected sector. Since transaction activity was reported to vary widely, a range of transaction volume was estimated for each establishment type. For each model establishment, annual regulatory costs were then calculated and compared to annual labor and overhead costs. Ratios were computed for both high and low estimates of the range of transaction activity. In the case of a real estate sales organization, regulatory costs were found to represent from 0.18 to 0.38 percent of labor and overhead costs. In the case of a rental establishment, impacts were slightly higher, ranging from 0.20 to 0.46 percent. An establishment engaged in both activities was projected to sustain impacts of 0.26 to 0.59 percent. Thus, while a large number of small establishments will be potentially affected by the rule, cost impacts were not found to be of sufficient magnitude to cause undue harm to such establishments. Consequently, no regulatory alternatives are being proposed in connection with small business impacts. Pursuant to section 605(b) of the Regulatory Flexibility Act, 5 U.S.C. 605(b), EPA certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities.
C. Paperwork Reduction Act The information collection requirements in this proposed rule have been submitted for approval to OMB under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. An Information Collection Request (ICR) document has been prepared by EPA and HUD (ICR No. 1710.01) and a copy may be obtained from Sandy Farmer, Information Policy Branch (MC-2136), Environmental Protection Agency, 401 M St., SW., Washington, DC or by calling (202) 260-2740. The collection of information that would be associated with this proposed rule is estimated to have a public burden averaging 19.5 minutes per response (at 6.5 minutes per an average of 3 respondents), and to require 15.4 minutes per respondent, annually. This includes time for gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding the burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden to Chief, Information Policy Branch (MC-2136); Environmental Protection Agency; 401 M St., SW; Washington, DC 20503, marked ``Attention: Desk Officer for EPA.'' The final rule will respond to any OMB or public comments on the information collection requirements contained in this proposed rule. D. Environmental Impact In accordance with 40 CFR 1508.4 of the regulations of the Council on Environmental Quality and 24 CFR 50.19 and 50.20(o)(2) of the HUD regulations, the policies and procedures contained in this proposed rule relate only to information services and, therfore, are categorically excluded from the requirements of the National Environmental Policy Act. E. HUD's Regulatory Agenda This proposed rule was listed as Item No. 1517 in HUD's Semiannual Agenda of Regulations published on April 25, 1994 (59 FR 20424, 20431), in accordance with Executive Order 12866 and the Regulatory Flexibility Act, and was requested by and submitted to the Committee on Banking, Finance and Urban Affairs of the House of Representatives under section 7(o) of the Department of Housing and Urban Development Act.
Environmental protection, Lead poisoning, Mortgage insurance, Recordkeeping and reporting requirements, and Rent subsidies.
Environmental protection, Hazardous substances, Lead, Recordkeeping and notification requirements. Dated: October 17, 1994. Henry Cisneros, Secretary, Housing and Urban Development. Dated: October 21, 1994. Carol M. Browner, Administrator, Environmental Protection Agency. Therefore, it is proposed that 24 CFR subtitle A and 40 CFR Chapter I be amended as follows. 24 CFR Subtitle A A new part 38 is added to 24 CFR subtitle A to read as follows:
Subpart A--Disclosure of Information Concerning Lead-Based Paint Upon Transfer of Residential Property Sec. 38.5 Purpose. 38.7 Scope and applicability. 38.10 Effective date. 38.15 Definitions. 38.20 Disclosure requirements. 38.21 Ten calendar-day opportunity to inspect. 38.22 Disclosure and acknowledgement forms. 38.25 Agent responsibilities. 38.30 Penalties. Appendix A to Subpart A Subparts B-G--[Reserved] Authority: 42 U.S.C. 4852(d). This subpart implements the provisions of section 1018 of the Residential Lead-Based Paint Hazard Reduction Act of 1992, which imposes certain requirements on the sale or lease of target housing. Under this subpart, a seller or lessor of target housing shall disclose to the purchaser or lessee all information known by the seller or lessor about lead-based paint and lead-based paint hazards, provide the purchaser with a lead hazard information pamphlet, and attach specific disclosure and warning language to the sales contract or lease. Sellers must also give the purchaser a 10-day opportunity to conduct an inspection or risk assessment, before the purchaser is obligated under a contract to purchase such housing. Sec. 38.7 Scope and applicability. This subpart does not apply to the sale of properties at foreclosure and informal rental agreements not involving a lease. Renewals of existing leases would be covered by the requirements of this subpart only if the lessor: (a) Did not previously provide the lessee with the lead-based paint hazard information required under Sec. 38.20; or (b) If the lessor becomes aware of additional information concerning lead-based paint hazards during the term of the lease, in which case he or she is required to disclose this information prior to renewal of the lease. Sec. 38.10 Effective date. The requirements in this subpart shall apply to any transaction to sell or lease target housing on or after October 28, 1995.
All definitions as set forth in section 1004 of the Residential
Lead-Based Paint Hazard Reduction Act apply in this part. In addition,
the following definitions are provided for the purposes of this
part. (2) All preparation, clean up, disposal, and post-abatement clearance
testing activities associated with such measures. Administrator means the Administrator of the Environmental Protection Agency. Agent means any party who enters into a contract with a seller or lessor to represent the seller or lessor for the purpose of selling or leasing target housing. Common area means a portion of a building generally accessible to all residents/users including, but not limited to, hallways, stairways, laundry and recreational rooms, playgrounds, community centers, and boundary fences. Contract for the purchase and sale of residential real property means any contract or agreement in which one party agrees to purchase an interest in real property on which there is situated one or more residential dwellings used or occupied, or intended to be used or occupied, in whole or in part, as the home or residence of one or more persons. EPA means the Environmental Protection Agency. Evaluation means a risk assessment and/or inspection. Inspection means: (1) A surface-by-surface investigation to determine the presence of lead-based paint as provided in section 302(c) of the Lead-Based Paint Poisoning and Prevention Act [42 U.S.C. 4822], and (2) The provision of a report explaining the results of the investigation. Lead-based paint means paint or other surface coatings that contain lead in excess of 1.0 milligrams per centimeter squared or 0.5 percent by weight or (1) In the case of paint or other surface coatings on target housing,
such lower level as may be established by the Secretary of Housing
and Urban Development as defined under section 302(c) of the Lead-Based
Paint Poisoning Prevention Act [42 U.S.C. 4822], or Lead-based paint hazard means any condition that causes exposure
to lead from lead-contaminated dust, lead-contaminated soil, lead-
Lessee means any entity that enters into an agreement to lease or rent target housing, including but not limited to individuals, partnerships, corporations, trusteeships, government agencies, Indian tribes, or nonprofit organizations. Lessor means any entity that offers target housing for lease, including but not limited to individuals, partnerships, corporations, trusteeships, government agencies, Indian tribes, or nonprofit organizations. Owner means any entity that has legal title to target housing, including but not limited to individuals, partnerships, corporations, trusteeships, government agencies, Indian tribes, or nonprofit organizations. Purchaser means any entity that submits a written offer to purchase an interest in target housing, including but not limited to individuals, partnerships, corporations, trusteeships, government agencies, Indian tribes, or nonprofit organizations. Residential dwelling means: (1) A single-family dwelling, including attached structures such as porches and stoops; or (2) A single-family dwelling unit in a structure that contains more than one separate residential dwelling unit, and in which each such unit is used or occupied, or intended to be used or occupied, in whole or in part, as the residence of one or more persons. Risk assessment means an on-site investigation to determine and report the existence, nature, severity, and location of lead-based paint hazards in residential dwellings, including: (1) Information gathering regarding the age and history of the housing and occupancy by children under age 6. (2) Visual inspection. (3) Limited wipe sampling or other environmental sampling techniques. (4) Other activity as may be appropriate. (5) Provision of a report explaining the results of the investigation. Secretary means the Secretary of Housing and Urban Development.
(1) An entity which transfers shares in a cooperatively owned project. (2) An entity which transfers its interest in a leasehold in jurisdictions or circumstances where it is legally permissible to separate the fee title from the title to the improvement. Target housing means any housing constructed prior to 1978, except housing for the elderly or persons with disabilities (unless any child who is less than 6 years of age resides or is expected to reside in such housing) or any 0-bedroom dwelling. 0-Bedroom dwelling means any residential dwelling in which the living area is unseparated from the sleeping area. Sec. 38.20 Disclosure requirements. (a) The following activities shall be completed before the purchaser or lessee is obligated under any contract to purchase or lease target housing. (1) The seller or lessor, or the agent acting on behalf of the seller or lessor, shall provide the purchaser or lessee with a copy of EPA's lead-hazard information pamphlet, entitled Lead-Based Paint: Protect Your Family, issued under section 406 of the Toxic Substances Control Act. (2) The seller or lessor, or the agent acting on behalf of the
seller or lessor, shall provide the purchaser or lessee with written
descriptions, or actual copies where available, of all information
known by the seller or lessor or the agent on the presence of lead-
(i) Reports from all lead-based paint inspections, risk assessments, and abatement activities known by the seller or lessor, or agent. (ii) If the target housing contains more than one residential dwelling: (A) Records of lead-based paint inspections, assessments, and
abatement activities conducted in common areas of the property.
(iii) Other information known by the seller or lessor, or agent that may indicate the presence of lead-based paint or lead-based paint hazards in the residential dwelling. (3) The seller shall make copies of the information required under paragragh (a)(2) of this section, accessible for inspection or copying by purchasers and lessees. (4) Each contract or agreement to sell property defined as target
housing shall contain a completed, signed, and dated copy of the
joint HUD/EPA form entitled Form A-Disclosure and Acknowledgement
of Lead- (5) Each contract or agreement to lease property defined as target
housing shall contain a completed, signed, and dated copy of the
joint HUD/EPA form entitled Form B-Disclosure and Acknowledgement
of Lead- (b) The seller or lessor shall disclose to the agent, any information known to the seller or lessor regarding lead-based paint or lead-based paint hazards within the target housing, as defined in paragragh (a)(2) of this section. (c) The seller, and any agent acting on behalf of the seller, shall retain a copy of the completed Form A required under paragraph (a)(4) of this section for 3 years from the completion date of the sale. The lessor, and any agent acting on behalf of the lessor, shall retain a copy of the completed Form B required under paragraph (a)(5) of this section for 3 years from the commencement of the leasing period.
This section applies only to transactions to sell target housing. As described in this section, each purchaser of target housing shall be given a 10 calendar-day opportunity to conduct an inspection or risk assessment of the target housing for lead-based paint and lead-based paint hazards prior to being bound to purchase the target housing. Unless otherwise agreed in writing by the parties, the inspection period shall be provided in the following manner. (a) The seller, or the agent acting on behalf of the seller, shall permit the purchaser 10 calendar days to conduct a risk assessment or inspection of the target housing for the presence of lead-based paint or lead-based paint hazards. (b) This opportunity shall be provided to the purchaser after the seller or the seller's agent has disclosed, in accordance with Sec. 38.20(a)(2), all information known to the seller and agent regarding lead-based paint and lead-based paint hazards in the target housing and after the purchaser has received the lead hazard information pamphlet required under Sec. 38.20(a)(1). (c) The 10 calendar-day opportunity to inspect or assess shall commence at the time the purchaser signs a contract to purchase the target housing. (d) The contract shall be contingent on finding no lead-based paint hazard in the inspection or risk assessment conducted by a certified firm. If a lead-based paint hazard is found during the inspection or risk assessment, the seller and purchaser shall mutually determine the terms under which the sale will or will not proceed. (e) The purchaser is not required to conduct a risk assessment or inspection of the target housing for the presence of lead-based paint or lead-based paint hazards. The purchaser and seller may mutually agree in writing to lengthen, shorten, or eliminate the 10-day inspection period. (f) The identity of the company performing the risk assessment or inspection and the results shall be provided to the seller.
(a) Availability of forms. Form A-Disclosure and Acknowledgement
of Lead-Based Paint Before Sale (GPO #XXX) and Form B-Disclosure
and Acknowledgement of Lead-Based Paint Before Lease (GPO #XXX)
are included for reference in Appendix A of this part. Copies are
available from the Government Printing Office (GPO) by writing to:
Government Printing Office, Superintendent of Documents, Mail Stop
XXX, Washington, DC 20402-9328. In addition, persons may contact
EPA's TSCA Hotline at 202-554-1404 for further information on obtaining
copies. Every purchaser of any interest in residential real property on which a residential dwelling was built prior to 1978 is notified that such property may present exposure to lead from lead-based paint that may place young children at risk of developing lead poisoning. Lead poisoning in young children may produce permanent neurological damage, including learning disabilities, reduced intelligence quotient, behavioral problems, and impaired memory. Lead poisoning also poses a particular risk to pregnant women. The seller of any interest in residential real property is required to provide the buyer with any information on lead-based paint hazards from risk assessments or inspections in the seller's possession and notify the buyer of any known lead-based paint hazards. A risk assessment or inspection for possible lead-based paint hazards is recommended prior to purchase. (2) In Part II of Form A, the seller shall certify, by signing and dating the form, that he or she has: (i) Disclosed to the purchaser any information known to the seller
on lead-based paint and lead-based paint hazards in the target housing.
(iii) Provided the purchaser with a 10 calendar-day opportunity to conduct a risk assessment or inspection. (3) In Part III of Form A, the agent, if any, shall certify, by signing and dating the form, that the agent has: (i) Informed the seller of the seller's obligation under this subpart. (ii) Ensured that any information known to the agent on lead-based paint and lead-based paint hazards in the target housing has been disclosed to the purchaser. (iii) Ensured that the EPA lead pamphlet has been provided to the purchaser. (iv) Ensured that the purchaser has been or will be given a 10
calendar-day opportunity to conduct a risk assessment or inspection.
(i) Read and understood the attached lead warning statement. (iii) Received the lead hazard information pamphlet. (iv) Understands that he or she is entitled, by law, to a 10 calendar-day
opportunity to conduct a risk assessment or inspection. A residential structure built prior to 1978 may present exposure to lead from lead-based paint. This exposure may place young children at risk of developing lead poisoning. Lead poisoning in young children can produce permanent neurological damage, including learning disabilities, reduced intelligence quotient, behavioral problems, and impaired memory. Lead poisoning also poses a particular risk to pregnant women. The lessor of any residential dwelling is required to provide the lessee with any information on lead-based paint hazards from risk assessments or inspections in the lessor's possession and notify the lessee of any known lead-based paint hazards. (2) In Part II of Form B, the lessor shall certify that he or she has disclosed any information known to the lessor on lead-based paint and lead-based paint hazards in the target housing and provided the lessee with the EPA lead pamphlet. The lessor shall sign and date the form. (3) In Part III of Form B, the agent, if any, shall certify that he or she has notified the lessor of the lessor's obligation under this subpart, ensured that any information known to the lessor and the agent on lead-based paint and lead-based paint hazards in the target housing has been disclosed, and ensured that the lessee has been given the EPA lead pamphlet. The agent shall sign and date the form. (4) In Part IV of Form B, the lessee shall acknowledge that he or she received the disclosures in Part II of Form B and the EPA lead pamphlet. The lessee shall sign and date the form. Sec. 38.25 Agent responsibilities. (a) Each agent shall ensure compliance with all requirements of this subpart. To ensure compliance, the agent shall: (1) Inform the seller or lessor of their obligations under Secs. 38.20, 38.21, and 38.22, and to disclose to the agent information known to the seller or lessor regarding lead-based paint and lead-based paint hazards. (2) Either: (i) Make certain that the seller or lessor has performed all activities required under Secs. 38.20, 38.21, and 38.22. (ii) Personally comply with the requirements of Secs. 38.20, 38.21, and 38.22. (b) If the agent has complied with Sec. 38.25(a), the agent shall not be liable for the failure to disclose to a purchaser or lessee information regarding lead-based paint or lead-based paint hazards known by a seller or lessor but not disclosed to the agent.
(a) Under section 1018(b)(1) of the Act, any person who knowingly fails to comply with any provision of this subpart shall be subject to civil monetary penalties in accordance with the provisions of section 102 of the Department of Housing and Urban Development Reform Act of 1989 [42 U.S.C. 3545] and 24 CFR part 30. (b) Under section 1018(b)(2) of the Act, the Secretary is authorized
to take such action as may be necessary to enjoin any violation
of this subpart in the appropriate Federal district court. (d) In any civil action brought for damages pursuant to section 1018(b)(3) of the Act, the appropriate court may award court costs to the party commencing such action, together with reasonable attorney fees and any expert witness fees, if that party prevails. (e) It is a prohibited act under section 409 of the Toxic Substances Control Act [15 U.S.C. 2689] for any person to fail or refuse to comply with a provision of this subpart. For purposes of enforcing this subpart under the Toxic Substances Control Act, the penalty for each violation applicable under section 16 of that Act is not more than $10,000. Appendix A to Supart A of Part 38 Form A--Disclosure and Acknowledgment of Lead-Based Paint Before Sale OMB #____________ Part I: Lead Warning Statement Every purchaser of any interest in residential real property on which a residential dwelling was built prior to 1978 is notified that such property may present exposure to lead from lead-based paint that may place young children at risk of developing lead poisoning. Lead poisoning in young children may produce permanent neurological damage, including learning disabilities, reduced intelligence quotient, behavioral problems, and impaired memory. Lead poisoning also poses a particular risk to pregnant women. The seller or any interest in residential real property is required to provide the buyer with any information on lead-based paint hazards from risk assessments or inspections in the seller's possession and notify the buyer of any known lead-based paint hazards. A risk assessments or inspection for possible lead-based paint hazards is recommended prior to purchase. Part II: Seller's Certification Seller certifies to have disclosed to the purchaser and agent
all information known to the seller regarding the presence of lead-
(a) On---------------------------------------------------------------------
seller provided the purchaser with lead-hazard reports based on lead-based paint inspections, assessments, or abatements conducted on the following dates: (b) On---------------------------------------------------------------------
the seller provided the purchaser with the following information on lead-based paint hazards in common areas: (c) On---------------------------------------------------------------------
the seller provided the purchaser with following additional information that may indicate lead-based paint and lead-based paint hazards in the target housing. (d) On---------------------------------------------------------------------
Seller certifies that no additional information is known about this target housing. (Note: By selecting (d), seller does not avoid liability for lead-based paint and lead-based paint hazards known to the seller that are not noted under (a), (b), or (c). (e) On---------------------------------------------------------------------
the seller provided the purchaser with the lead hazard information pamphlet Lead-Based Paint: Protect Your Family. The seller is aware that Federal laws requires the seller to permit the purchaser a 10 calendar day period to conduct a risk assessment or inspection for the presence of lead-based paint hazards before becoming obligated under a contract to purchase target housing (unless mutually agreed otherwise in writing). That opportunity was or will be provided between the following dates: __________________. €---------------------------------------------------------------------
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Part III: Agent's Certification (When Applicable) Agent certifies to have informed the seller of his/her obligation
to disclose to the purchasers and agent all information known to
the seller regarding the presence of lead-based paint and lead-based
paint hazards within this target housing and that all information
known to the agent regarding the presence of lead-based paint and
lead-based paint hazards within this target housing has been disclosed
to the purchaser. Agent further certifies that the purchaser received
the lead hazard information pamphlet Lead-Based Paint: Protect Your
Family and that the purchaser has or will be given a 10 calendar-day
period (unless otherwise agreed in writing) to conduct a risk assessment
or inspection for the presence of lead- €---------------------------------------------------------------------
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Part IV: Purchaser's Acknowledgment I acknowledge that I have read and understood the attached lead warning statement in part I of this form and received all information noted in Part II of this form, including the lead hazard information pamphlet Lead-Based Paint: Protect Your Family. I further acknowledge that, pursuant to 42 U.S.C. 4852(d) and its implementing regulations, the attached contract entitles me to 10 calendar days to conduct a risk assessment or inspection for the presence of lead-based paint hazards before becoming obligated under a contract to purchase this target housing, unless mutually agreed otherwise, in writing. €---------------------------------------------------------------------
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Appendix A to Subpart A of Part 38 Form B--Disclosure and Acknowledgment of Lead-Based Paint Before Lease OMB #____________ Part I: Lead Warning Statement A residential structure built prior to 1978 may present exposure to lead from lead-based paint. This exposure may place young children at risk of developing lead poisoning. Lead poisoning in young children can produce permanent neurological damage, including learning disabilities, reduced intelligence quotient, behavioral problems, and impaired memory. Lead poisoning also poses a particular risk to pregnant women. The lessor of any residential dwelling is required to provide the lessee with any information on lead-based paint hazards from risk assessments or inspections in the lessor's possession and notify the lessee of any known lead-base paint hazards. Part II: Lessor's Certification Lessor certifies to have disclosed to the lessee and agent all information known to the lessor regarding the presence of lead-based paint and lead-based paint hazards within this target housing. The information provided includes: (a) On---------------------------------------------------------------------
the lessor provided the lessee with lead-hazard reports based on lead-based paint inspections, assessments, or abatements conducted on the following dates: (b) On---------------------------------------------------------------------
the lessor provided the lessee with the following information on lead-based paint hazards in common areas: (c) On---------------------------------------------------------------------
the lessor provided the lessee with following additional information that may indicate lead-based paint and lead-based paint hazards in the target housing. (d) On---------------------------------------------------------------------
Lessor certifies that no additional information is known about this target housing. Note: By selecting (d), lessor does not avoid liability for lead-
(e) On---------------------------------------------------------------------
the lessor provided the lessee with the lead hazard information pamphlet Lead-Based Paint: Protect Your Family. €---------------------------------------------------------------------
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Part III: Agent's Certification (When Applicable) Agent certifies to have informed the lessor of his/her obligation
to disclose to the lessee and agent all information known to the
lessor regarding the presence of lead-based paint and lead- €---------------------------------------------------------------------
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Part IV: Lessee's Acknowledgment I acknowledge that I have read and understood the attached lead warning statement in Part I of this form, received the information noted in Part II of this form, and received the materials noted above, including the pamphlet Lead-Based Paint: Protect Your Family.
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BILLING CODE 6560-50-M . Title: Gopher File
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