Guarantee Fee Rates for Guaranteed Loans for Fiscal Year 2020, Maximum Portion of Guarantee Authority Available for Fiscal Year 2020, Annual Renewal Fee for Fiscal Year 2020
| Citation | 85 FR 9725 |
| Record Number | 2020-03338 |
| Published date | 20 February 2020 |
| Section | Notices |
| Court | Rural Business-cooperative Service |
Federal Register, Volume 85 Issue 34 (Thursday, February 20, 2020)
[Federal Register Volume 85, Number 34 (Thursday, February 20, 2020)]
[Notices]
[Pages 9725-9726]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-03338]
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DEPARTMENT OF AGRICULTURE
Rural Business-Cooperative Service
Guarantee Fee Rates for Guaranteed Loans for Fiscal Year 2020,
Maximum Portion of Guarantee Authority Available for Fiscal Year 2020,
Annual Renewal Fee for Fiscal Year 2020
AGENCY: Rural Business-Cooperative Service, USDA.
ACTION: Notice.
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SUMMARY: This notice helps to improve applicants' awareness of the
Guarantee Fee rates for Guaranteed Loans for fiscal year (FY) 2020, the
Maximum Portion of Guarantee Authority Available for FY 2020, and the
Annual Renewal Fee for FY 2020 when applying for guaranteed loans under
the Business and Industry (B&I) Guaranteed Loan Program.
The Agency has the authority to charge a guarantee fee and an
annual renewal fee for loans made under the B&I Guaranteed Loan
Program. Pursuant to that authority, and subject to the current
appropriated authority, the Agency is establishing an initial guarantee
fee rate of 3 percent and an annual renewal fee rate of one-half of 1
percent for the B&I Guaranteed Loan Program.
The initial guarantee fee is paid at the time the Loan Note
Guarantee is issued. The annual renewal fee is paid by the lender to
the Agency once a year. Payment of the annual renewal fee is required
in order to maintain the enforceability of the guarantee.
DATES: This rule is effective February 20, 2020.
FOR FURTHER INFORMATION CONTACT: Brenda Griffin, USDA, Rural
Development, Business Programs, Business and Industry Division, STOP
3224, 1400 Independence Avenue SW, Washington, DC 20250-3224, telephone
(202) 720-6802, email [email protected].
SUPPLEMENTARY INFORMATION:
As set forth in 7 CFR 4279.120, the Agency has the authority to
charge an initial guarantee fee and an annual renewal fee for loans
made under the B&I Guaranteed Loan Program. Pursuant to that authority,
and subject to the current appropriated authority, the Agency is
establishing an initial guarantee fee rate of 3 percent and an annual
renewal fee rate of one-half of 1 percent for the B&I Guaranteed Loan
Program. Unless precluded by a subsequent FY 2020 appropriation, these
rates will apply to all loans obligated in FY 2020 that are made under
the B&I Guaranteed Loan Program. As established in 7 CFR
4279.120(b)(1), the amount of the annual fee on each guaranteed loan
will be determined by multiplying the annual fee rate by the
outstanding principal loan balance as of December 31, multiplied by the
percentage of guarantee.
As set forth in 7 CFR 4279.120(a) and 4279.119(b), each fiscal
year, the Agency shall establish a limit on the maximum portion of B&I
guarantee
[[Page 9726]]
authority available for that fiscal year that may be used to guarantee
loans with a reduced guarantee fee or guaranteed loans with an
increased percentage of guarantee. The Agency has established that not
more than 5 percent of the Agency's apportioned B&I guarantee authority
will be reserved for loan guarantee requests with a reduced fee, and
not more than 5 percent of the Agency's apportioned B&I guarantee
authority will be reserved for guaranteed loan requests with an
increased percentage of guarantee. The funds set aside for increased
percentages of guarantee and reduced guarantee fees, which were set at
15 percent and 12 percent, respectively pursuant to the 2019 Agency
notice, now will change to 5 percent for both with this notice. Once
the respective limits are reached, all additional loans will be at the
standard fee and guarantee limits. These changes will have the effect
of reducing the need for USDA to reprogram funds, which can delay when
funds are made available to borrowers at regular terms and are based on
past experience in this program. Allowing a reduced guarantee fee or
increased percentage of guarantee on certain B&I guaranteed loans that
meet the conditions set forth in 7 CFR 4279.120 and 4279.119 will
increase the Agency's ability to focus guarantee assistance on projects
that the Agency has found particularly meritorious. Subject to annual
limits set by the Agency in this notice, the Agency may charge a
reduced guarantee fee if requested by the lender for loans of $5
million or less when the borrower's business supports value-added
agriculture and results in farmers benefitting financially, promotes
access to healthy foods, or is a high impact business development
investment located in a rural community that is experiencing long-term
population decline; has remained in poverty for the last 30 years; is
experiencing trauma as a result of natural disaster; is located in a
city or county with an unemployment rate 125 percent of the statewide
rate or greater; or is located within the boundaries of a federally
recognized Indian tribe's reservation or within tribal trust lands or
within land owned by an Alaska Native Regional or Village Corporation
as defined by the Alaska Native Claims Settlement Act. Subject to
annual limits set by the Agency in this notice, the Agency may allow
increased percentages of guarantee for high-priority projects or loans
where the lender needs the increased percentage of guarantee due to its
legal or regulatory lending limit.
Congressional Review Act
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Office of Information and Regulatory Affairs designated this notice
as not major, as defined by 5 U.S.C. 804(2).
Non-Discrimination Statement
In accordance with Federal civil rights law and U.S. Department of
Agriculture (USDA) civil rights regulations and policies, the USDA, its
Agencies, offices, and employees, and institutions participating in, or
administering, USDA programs are prohibited from discriminating based
on race, color, national origin, religion, sex, gender identity
(including gender expression), sexual orientation, disability, age,
marital status, family/parental status, income derived from a public
assistance program, political beliefs, or reprisal or retaliation for
prior civil rights activity, in any program or activity conducted or
funded by USDA (not all bases apply to all programs). Remedies and
complaint filing deadlines vary by program or incident.
Persons with disabilities who require alternative means of
communication for program information (e.g., Braille, large print,
audiotape, American Sign Language, etc.) should contact the responsible
Agency or USDA's TARGET Center at (202) 720-2600 (voice and TTY) or
contact USDA through the Federal Relay Service at (800) 877-8339.
Additionally, program information may be made available in languages
other than English.
To file a program discrimination complaint, complete the USDA
Program Discrimination Complaint Form, AD-3027, found online at: http://www.ascr.usda.gov/complaint_filing_cust.html and at any USDA office or
write a letter addressed to USDA and provide in the letter all of the
information requested in the form. To request a copy of the complaint
form, call (866) 632-9992. Submit your completed form or letter to USDA
by:
(1) Mail: U.S. Department of Agriculture, Office of the Assistant
Secretary for Civil Rights, 1400 Independence Avenue SW, Washington, DC
20250-9410;
(2) Fax: (202) 690-7442; or
(3) Email: [email protected].
USDA is an equal opportunity provider, employer, and lender.
Mark Brodziski,
Acting Administrator, Rural Business-Cooperative Service.
[FR Doc. 2020-03338 Filed 2-19-20; 8:45 am]
BILLING CODE 3410-XY-P
