[Federal Register Volume 59, Number 28 (Thursday, February 10, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-2933]
[[Page Unknown]]
[Federal Register: February 10, 1994]
=======================================================================
-----------------------------------------------------------------------
SMALL BUSINESS ADMINISTRATION
13 CFR Part 123
Disaster--Physical Disaster and Economic Injury Loans
AGENCY: Small Business Administration.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Small Business Administration (SBA) is revising on an
immediate basis the limitations on its share of disaster assistance
made available to homeowners for any one disaster commencing on or
after January 1, 1994, from $20,000 to $40,000 for repair and
replacement of household and personal effects and from $100,000 to
$200,000 for repair or replacement of a primary residence, and is also
increasing the limitations expressed in other provisions of its
regulations governing disaster loans to homeowners which are based upon
those limitations. This revision is being undertaken on an emergency
basis and is therefore published as a final rule.
DATES: This rule is effective on February 10, 1994.
ADDRESSES: Comments should be submitted to Bernard Kulik, Assistant
Administrator for Disaster Assistance, U.S. Small Business
Administration, 409 Third Street, SW., 8th floor, Washington, DC 20416.
FOR FURTHER INFORMATION CONTACT:
Michael E. Deegan, Office of Disaster Assistance, (202) 205-6734.
SUPPLEMENTARY INFORMATION: Pursuant to section 7(b)(1) of the Small
Business Act, 15 U.S.C. 636(b)(1), SBA is authorized to make disaster
loans available to repair, rehabilitate or replace homeowner's real or
personal property damaged or destroyed as a result of physical
disasters. Section 7(c)(6) of the same Act, 15 U.S.C. 636(c)(6),
provides that such loans are limited to a total amount of $500,000 of
SBA assistance for each disaster.
Under these authorities, SBA has established by regulation the
following limitations on assistance available to homeowners and others
for disasters commencing on or after October 1, 1982:
(1) $20,000 for repair or replacement of household and personal
effects;
(2) $100,000 for repair or replacement or a primary residence,
including repair or replacement of landscaping and/or recreational
facilities not to exceed $2,500;
(3) Eligible refinancing not to exceed the lesser of $100,000 or
the physical damage to the real property which is to be repaired;
(4) $24,000 for mitigation of further damage from like disasters;
(5) $244,0000 for the total loan within the limitations specified
in (1) through (4) above, and
(6) Persons living in a damaged home who are not dependents of the
occupant may apply for loans to repair or replace personal property to
the extent of their loss, but such loans may not exceed $20,000.
These loan limitations were established in 1984, and have become
insufficient to meet the needs of many homeowners and renters who have
been confronted with the effects of physical disasters by virtue of the
impact of economic inflation. They are now, for example, inadequate to
compensate many disaster victims for the costs associated with
rebuilding, replacing and repairing residential, real property and
household effects such as clothing, furniture and appliances which have
been lost or damaged as a result of a physical disaster. Moreover, in
the aftermath of disasters, especially large catastrophes, construction
costs often increase sharply. Therefore, SBA, under the statutory
authority cited above, has decided to increase these limitations to
meet the impact of inflation and construction cost increases. Effective
for any disaster commencing on or after January 1, 1994, the new
limitations are:
(1) $40,000 for repair or replacement of household and personal
effects;
(2) $200,000 for repair or replacement of a primary residence,
including repair replacement of landscaping and/or recreational
facilities not to exceed $5,000;
(3) Eligible refinancing not to exceed the lesser of $200,000 or
the physical damage to the real property which is to be repaired;
(4) $48,000 for mitigation of future damage from like disasters;
(5) $488,000 for the total loan within the limitations specified in
(1) through (4) above, and
(6) Persons living in a damaged home who are not dependents of the
occupant may apply for loans to repair or replace personal property to
the extent of their loss, but such loans may not exceed $40,000.
SBA is establishing these new limitations effective upon
publication pursuant to 13 CFR 123.1(b) which authorizes emergency
changes in the regulations governing its disaster assistance program,
and 5 U.S.C. 553(b)(B) which permits publication of regulations in
final form without notice of comment when an agency finds that good
cause exists for publication in final form on an emergency basis, and
that notice and comment is impracticable, unnecessary or contrary to
the public interest. In this regard, the public interest in seeing to
it that the new limitations are effective as to the recent California
earthquake disaster makes the utilization of notice and comment
rulemaking impracticable.
Compliance With Executive Orders 12866, 12612, and 12778; Regulatory
Flexibility Act, 5 U.S.C. 601, et seq.; and the Paperwork Reduction
Act, 44 U.S.C. Ch. 35.
For purposes of Executive Order 12866, SBA certifies that this rule
will not have an annual economic effect in excess of $100 million,
result in a major increase in costs for individuals or governments, or
have a significant adverse effect on competition, and, therefore, would
not constitute a major or significant rule. SBA has made this
determination based upon the fact that even though this rule would
increase the amounts of disaster assistance available to an individual
borrower, it would not, in and of itself, increase the gross amount of
disaster assistance available to those who are eligible. Individual
applicants will still be governed by eligibility requirements for SBA
disaster assistance and will remain eligible for assistance to the
extent of verifiable loss as present regulations provide.
For purposes of Executive Order 12612, SBA certifies that this rule
will not have federalism implications warranting the preparation of a
Federalism assessment.
For purposes of Executive Order 12778, SBA certifies that this rule
is drafted, to the extent practicable, in accordance with the standards
set forth in section 2 of that Order.
For purposes of the Regulatory Flexibility Act, SBA certifies that
this rule will not have a significant economic effect on a substantial
number of small entities for the same reason that it is not a major or
significant rule.
For purposes of the Paperwork Reduction Act, SBA certifies that
this rule will not impose a new recordkeeping or reporting requirement.
(Catalog of Federal Domestic Assistance Program No. 59.008,
Small Business)
List of Subjects in 13 CFR Part 123
Disaster, Physical disaster and economic injury loans.
For the reasons set out above, pursuant to sections 5(b)(6),
7(b)(1), and 7(c)(6) of the Small Business Act, Title 13, part 123 of
the Code of Federal Regulations, is amended to read as follows:
PART 123--[AMENDED]
1. The authority citation for part 123 continues to read as
follows:
Authority: Sections 5(b)(6), 7(b), (c), (f) of the Small
Business Act, 15 U.S.C. 634(b)(6), 636(b), (c), (f); Pub. L. 102-
395, 106 Stat. 1828, 1864; and Pub. L. 103-75, 107 Stat. 739.
2. Section 123.25 is amended by revising paragraphs (a) and (b) to
read as follows:
Sec. 123.25 Special conditions--Home loans.
(a) Limits. SBA's share of loans approved on or after October 1,
1983, to a Homeowner (including all dependents) is limited for any one
disaster commencing on or after January 1, 1994, to the following:
(1) $40,000 for repair or replacement of household and personal
effects;
(2) $200,000 for repair or replacement of a primary residence,
including repair or replacement of landscaping and/or recreational
facilities not to exceed $5,000;
(3) Eligible refinancing pursuant to Sec. 123.24(f) not to exceed
the lesser of $200,000 or the physical damage to the real property
which is to be repaired;
(4) $48,000 for mitigation pursuant to Sec. 123.24(j);
(5) $488,000 for the total loan within the limitations specified in
paragraphs (a)(1) through (a)(4) of this section.
(b) Additional limits. Persons living in a damaged home who are not
dependents of the occupant may apply for loans to repair or replace
personal property to the extent of their loss, but such loans may not
exceed $40,000.
* * * * *
Dated: February 1, 1994.
Erskine B. Bowles,
Administrator.
[FR Doc. 94-2933 Filed 2-9-94; 8:45 am]
BILLING CODE 8025-01-M
