[Federal Register Volume 59, Number 135 (Friday, July 15, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-17202]
[[Page Unknown]]
[Federal Register: July 15, 1994]
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SMALL BUSINESS ADMINISTRATION
13 CFR Part 123
Disaster--Physical Disaster and Economic Injury Loans
AGENCY: Small Business Administration.
ACTION: Final rule.
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SUMMARY: The Small Business Administration (SBA) is revising on an
immediate basis the commencement date for the increases in the
limitations on SBA's share of homeowner disaster assistance which were
published at 59 FR 6213 (February 10, 1994). This revision is being
undertaken on an emergency basis and is therefore published as a final
rule.
EFFECTIVE DATE: July 15, 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: On February 10, 1994, SBA published a final
rule increasing the limitations on SBA's share of disaster assistance
made available to homeowners or renters for any one disaster commencing
on or after January 1, 1994. 59 Fed. Reg. 6213. The increased limits
were twice those previously available for disaster assistance to
homeowners and renters.
As SBA explained in the preamble to the final rule, the former loan
limitations had become insufficient to meet the needs of many
homeowners and renters confronted with the effects of physical
disasters. Economic inflation, together with the increase in
construction costs typically present in the aftermath of a large
catastrophe, had precipitated the need for the increased loan limits.
The increases were adopted by SBA on an emergency basis, without
notice or comment, in order to expedite their application to the
California earthquake disaster of January 1994. As adopted, the
increases were effective only for disasters commencing on or after
January 1, 1994.
Comments received subsequent to the publication of that emergency
rule have caused SBA to reconsider its selection of January 1, 1994 as
the appropriate commencement date for the application of the new loan
limits. As is sometimes the case when a new rule is adopted, the
precipitating factors (in this case, general inflation and spikes in
construction expense) have been present for a period of time either
before the need for a revision to the regulation is recognized or
before the regulation is finally adopted. In order to compensate for
this delay, SBA sometimes makes a rule effective prior to its date of
publication. By adopting an effective date of January 1,1994 for the
homeowner/renter loan limitation rule (a date six weeks prior to the
publication of the rule), SBA was extending the benefits of that rule
to victims of very recent disasters, whose loan applications had not
yet been processed by the Agency.
At that time, however, loan applications in connection with
disasters commencing as far back as October 26, 1993, the commencement
date for the California wildland fire disaster, were still being
processed. Victims of the California fire disaster were as much in need
of the increased loan limits as their counterpart victims of the
California earthquake disaster since both disasters occurred in the
same general area. In order to administer the Disaster Program in a
consistent and equitable manner, SBA has determined that the increased
loan limits it adopted on February 10, 1994 should be extended to all
disasters commencing on or after October 26, 1993.
This change is being made 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 or
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 immediately effective as to the California wildland fire disaster
so as to promptly assist the affected homeowners and renters 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 for the five disasters
commencing between October 26, 1993 and December 31, 1993 (inclusive),
physical disaster loans to homeowners and renters did not exceed $38
million. Many of those borrowers will not need or be eligible for the
increased loan limits. However, even if they all needed and were
eligible for the full amount of the increases, the maximum effect of
those increases could be no more than $38 million.
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 as follows:
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 paragraph (a) 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 October 26, 1993, 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) of this part;
(5) $488,000 for the total loan within the limitations specified in
paragraphs (a)(1) through (a)(4) of this section.
* * * * *
Dated: June 29, 1994.
Erskine B. Bowles,
Administrator.
[FR Doc. 94-17202 Filed 7-14-94; 8:45 am]
BILLING CODE 8025-01-M
