[Federal Register Volume 59, Number 178 (Thursday, September 15, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-22877]
[[Page Unknown]]
[Federal Register: September 15, 1994]
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Part V
Department of Commerce
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Economic Development Administration
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Economic Development Financial Restructuring Assistance Program for
Businesses Affected by the Southern California Earthquake; Notice
DEPARTMENT OF COMMERCE
Economic Development Administration
[Docket No. 940830-4230]
Economic Development Financial Restructuring Assistance Program
for Businesses Affected by the Southern California Earthquake
AGENCY: Economic Development Administration (EDA), Department of
Commerce (DoC).
ACTION: Notice.
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SUMMARY: The Economic Development Administration (EDA) announces the
policies and the application procedures for funds available to support
disaster relief programs designed to assist affected businesses located
in communities impacted by the California Northridge earthquake, under
the Presidential declaration of disaster of January 17, 1994.
DATES: This announcement is effective September 15, 1994. An
Intermediary Worksheet, with instructional guidelines (Appendix A),
will serve as the initial proposal for EDA review. This information is
available from EDA's Pasadena office. The completed worksheets will be
received for 30 days from the date of this notice. Due to the exigency
of the Financial Restructuring Assistance Program, EDA may commence
with grant awards prior to the 30 day deadline for receipt of the
worksheets.
ADDRESSES: To establish merits of project proposals, interested parties
should contact the EDA Disaster Field Office, 150 East Colorado
Boulevard, Suite 101, Pasadena, California 91105; telephone (818) 583-
6831.
FOR FURTHER INFORMATION CONTACT: Potential applicants should contact
the Economic Development Representatives (EDRs), Charles Oaks or James
Lavery, at the EDA Disaster Field Office, 150 East Colorado Boulevard,
Suite 101, Pasadena, California 91105; telephone (818) 583-6831.
SUPPLEMENTARY INFORMATION: Buy American-Made Equipment or Products--
Applicants are hereby notified that they are encouraged, to the extent
feasible, to purchase American-made equipment and products with funding
provided under this program in accordance with Congressional intent as
set forth in the resolution contained in Public Law 103-121, Sections
606 (a) and (b).
Refer to the Notice published on March 30, 1994, in the Federal
Register (59 FR 14996) for information on EDA's general policies and
other requirements.
Authority
Support for this program is authorized under the contingency fund
provided to the President under Public Law 103-211, the Emergency
Supplemental Appropriations Act of 1994.
Catalog of Federal Domestic Assistance (CFDA)
The Special Economic Development and Adjustment Assistance
Program--Long-Term Economic Deterioration (LTED) and Sudden and Severe
Economic Dislocation (SSED) is listed under CFDA 11.307.
Program Description
Assistance will be provided in the form of grants to eligible
intermediaries to capitalize or recapitalize a revolving loan fund
program. The primary purpose and focus of the initial lending phase of
the program will be to provide funds to assist in the financial
restructuring of businesses denied assistance by the Small Business
Administration (SBA). Businesses that receive loans from EDA grantees
under this program must demonstrate to grantees that financial
viability existed before the effects of the disaster on the capital
structure of the business.
Upon completion of an initial lending phase, intermediaries will be
eligible to apply program funds to assist other targeted businesses
after submittal of an Administrative Plan which addresses a longer-term
recovery strategy.
Funding Availability
Funds in the amount of $30 million are available for this disaster
recovery program and shall remain available until expended.
Funding Instrument
Funds will be awarded through grants under the Sudden and Severe
Economic Dislocation (SSED) program under Title IX of the Public Works
and Economic Development Act of 1965, as amended (Pub. L. 89-136, 42
U.S.C. 3241 et seq.) (PWEDA), as described in the Federal Register of
March 30, 1994 (59 FR 15005), that announces EDA's FY 1994 Notice of
Availability of Funds, or such subsequent annual Notices of the
Availability of Funds.
Eligible Applicants
Priority consideration for selection of intermediaries will be
given to Community Development Corporations as defined in the Community
Economic Development Act (42 U.S.C. 9802), and to nonprofit
organizations determined by EDA to be representative of a redevelopment
area. To meet this requirement, nonprofit organizations shall obtain a
written endorsement from the city or county in which the nonprofit
operates.
All nonprofit applicants are subject to a name check review
process. Name checks are intended to reveal if any key individuals
associated with the applicant have been convicted of, or are presently
facing, criminal charges such as fraud, theft, perjury, or other
matters which significantly reflect on the applicant's management,
honesty or financial integrity.
Grantee Responsibilities
Grantees selected for this program shall agree to administer these
funds in accordance with applicable EDA published directives. To
implement the intent of the program, substantial deviation from the
above-mentioned directives may be required. EDA will work with the
grantees and provide individual or blanket waivers from the established
directives, when appropriate.
Since the nature of the loans contemplated under this program
involve substantial risk compared to loans traditionally made with
funds available to grantees under Title IX of the Public Works and
Economic Development Act of 1965 (PWEDA), as amended, grantees must
agree to participate in special efforts as announced from time to time
by EDA to assure prudent management of these funds. Additionally,
grantees will be expected to participate in EDA-sponsored initiatives
to leverage the impact of these funds through such mechanisms as
securitization.
Proposal Submission Procedures
Proposals for assistance authorized under the contingency fund
provided to the President under Public Law 103-211, the Emergency
Supplemental Appropriations Act of 1994, shall be submitted to EDA's
Pasadena Disaster Field Office, as noted in the ADDRESSES section of
this Notice.
Intermediaries must clearly demonstrate how the EDA assistance will
help businesses recover from the economic hardship and other problems
caused by the Northridge Earthquake, and that such assistance has been
preceded by sound planning. Interested parties should contact EDA's
Pasadena Disaster Field Office for a proposal package.
Grant Rates
Local share requirements are discussed in the Federal Register of
March 30, 1994, (59 FR 15006) announcing the policies and application
procedures for EDA's Fiscal Year 1994 programs. Due to the critical
nature of this program, the Assistant Secretary for Economic
Development has determined that a higher than normal grant rate will be
considered. Grants will be awarded at the level not to exceed 90
percent of the project cost. Grant funds may be awarded for revolving
loan fund assistance, and for administrative support not to exceed two
years. In extenuating circumstances, EDA may waive the local share
requirement where permitted by the PWEDA and its implementing
regulations at 13 CFR Chapter III.
Application Procedures
Following the review of the Intermediary Worksheet (Appendix A),
EDA will invite those entities whose projects are selected for
consideration to submit full applications. Except as modified herein,
application procedures, evaluation criteria, and post-approval project
implementation information for the Title IX assistance are described in
the Federal Register of March 30, 1994, (59 FR 15005) announcing EDA's
Notice of Availability of Funds for FY 1994.
The form associated with this notice has been approved by OMB under
Control Number 0610-0058.
Dated: September 9, 1994.
William W. Ginsberg,
Assistant Secretary for Economic Development.
Appendix A--Intermediary Worksheet, EDA's Financial Restructuring
Assistance Program
Interested parties should submit a concise response to each of
the following items, preferably no more than ten pages total.
Provide a cover sheet signed by the preparer or executive officer.
1. Describe the nature of your overall organization and the
sources of administrative and program funding. Provide an
organization chart and a copy of the most recent, audited financial
statements for your organization.
2. Describe your organization's involvement in economic
development lending, including a description of the programs which
you provide business technical assistance, loan packaging services,
loan portfolio administration, loan servicing, workouts, and/or
foreclosure actions. Provide a summary of the loan activity for each
program for which your organization has a primary role.
3. Provide the status of loans which your organization was
responsible for approving and servicing; discuss or provide data
showing the repayment and default status of these loans. Indicate
the # and $ amount of loans presently being serviced and the
historical default rate of managed portfolios.
4. Describe your organization's loan administration
capabilities, including the number of people directly involved in
lending activities, and the degree to which your organization has
been or is involved in negotiating or restructuring debt
obligations. Provide resumes of key loan personnel directly involved
in lending functions, and list loan board membership by occupation
and employer name, if applicable.
5. Briefly describe your lending and servicing procedures and
systems for delivery and servicing of loan programs for which your
organization is responsible.
6. Explain how your organization relates to the community at
large and set forth the reasons you believe your organization is (or
will be) recognized as a leading institution for economic and
entrepreneurial development in your present service area (and
expanded service area, if applicable). Describe your present service
area (and expanded service area, if applicable).
7. Describe the amount of the grant funds under this program
which your organization would request, and could realistically and
successfully lend within two years, based upon your stated
assumptions. Indicate how you would market this program relative to
existing and (proposed) expanded service areas. Indicate how this
would be accomplished with existing and/or additional lending staff,
including a brief discussion or present staff capacity and
experience regarding debt restructuring, and dollar requirements to
administer the proposed program over an initial three-year period.
(Note that interest earnings may be used for program administrative
expenses.) Provide suggestions how the program could or should be
operated.
[FR Doc. 94-22877 Filed 9-14-94; 8:45 am]
BILLING CODE 3510-24-P
