Business and Industry Guaranteed Loan Program, 17616-17618 [05-6869]

Download as PDF 17616 Federal Register / Vol. 70, No. 66 / Thursday, April 7, 2005 / Proposed Rules and shield are used in direct association with a clear description of the process verified points that have been approved by the Branch. (b) Use of the ‘‘USDA Process Verified’’ statement and the ‘‘USDA Process Verified’’ shield shall be approved in writing by Chief prior to use by an applicant. Charges for Service § 62.300 Fees and other costs for service. Fees and other charges will be levied based on the following provisions: (a) Fees for service. Fees for QSVP services shall be based on the time required to provide service calculated to the nearest quarter hour period, including, but not limited to, official assessment time, travel time, and time required to prepare assessment reports. The hourly fee rate shall be $108 per hour. (b) Transportation costs. Applicants are responsible for paying actual travel costs incurred to provide QSVP services including but not limited to: mileage charges for use of privately owned vehicles, rental vehicles and gas, parking, tolls, and public transportation costs such as airfare, train, and taxi service. (c) Per diem costs. The applicant is responsible for paying per diem costs incurred to provide QSVP services away from the auditor’s or USDA officials’ official duty station(s). Per diem costs shall be calculated in accordance with existing travel regulations (41 CFR, subtitle F—Federal Travel Regulation System, chapter 301). (d) Other costs. When costs, other than those costs specified in paragraphs (a), (b), and (c) of this section, are involved in providing the QSVP services, the applicant shall be responsible for these costs. The amount of these costs shall be determined administratively by the Chief. However, the applicant will be notified of these costs before the service is rendered. § 62.301 Payment of fees and other charges. Fees and other charges for QSVP services shall be paid in accordance with the following provisions. Upon receipt of billing for fees and other charges, the applicant shall remit payment within 10 business days by check, electronic funds transfer, draft, or money order made payable to USDA, AMS, in accordance with directions on the billing. Fees and charges shall be paid in advance if required by the auditor or other authorized USDA official. VerDate jul<14>2003 15:06 Apr 06, 2005 Jkt 205001 Miscellaneous OMB Control Number § 62.400 OMB control number assigned pursuant to the Paperwork Reduction Act. The information collection and recordkeeping requirements of this Part have been approved by OMB under 44 U.S.C. Chapter 35 and have been assigned OMB Control Number 0581– 0124. Subpart B—[Reserved] Dated: April 4, 2005. Kenneth C. Clayton, Acting Administrator, Agricultural Marketing Service. [FR Doc. 05–6957 Filed 4–6–05; 8:45 am] BILLING CODE 3410–02–P DEPARTMENT OF AGRICULTURE Rural Business-Cooperative Service Rural Utilities Service 7 CFR Part 4279 RIN 0570–AA54 Business and Industry Guaranteed Loan Program Rural Business-Cooperative Service, USDA. ACTION: Proposed rule. AGENCY: SUMMARY: The Rural BusinessCooperative Service (RBS) proposes to amend its regulation for the Business and Industry (B&I) Guaranteed Loans by modifying the regulations regarding personal and corporate guarantors. This action will standardize the guarantor process. The Agency will create a guarantor form which will be used to obtain the personal or corporate guarantee of anyone owning greater than 20 percent interest in the borrower. The effect of this rule is to allow the Agency to use all remedies available to pursue collection from guarantors, including offset under the Debt Collection Improvement Act. DATES: Written or e-mail comments must be received on or before June 6, 2005, to be assured of consideration. ADDRESSES: You may submit comments to this rule by any of the following methods: • Agency Web site: https:// rdinit.usda.gov/regs/. Follow instructions for submitting comments on the Web site. • E-Mail: comments@usda.gov. Include RIN No. 0570–AA54 in the subject line of the message. PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 • Federal eRulemaking Portal: https:// www.regulations.gov. Follow the instructions for submitting comments. • Mail: Submit written comments via the U.S. Postal Service to the Branch Chief, Regulations and Paperwork Management Branch, U.S. Department of Agriculture, STOP 0742, 1400 Independence Avenue, SW., Washington, DC 20205–0742. • Hand Delivery/Courier: Submit written comments via Federal Express Mail or other courier service requiring a street address to the Branch Chief, Regulations and Paperwork Management Branch, U.S. Department of Agriculture, 300 7th Street, SW., 7th Floor, Washington, DC 20024. All written comments will be available for public inspection during regular work hours at 300 7th Street, SW., 7th Floor, address listed above. FOR FURTHER INFORMATION CONTACT: David Lewis, Business and Industry Loan Servicing Branch, Rural BusinessCooperative Service, U.S. Department of Agriculture, STOP 3224, 1400 Independence Avenue, SW., Washington, DC 20250–3224, telephone (202) 690–0797, or by e-mail to david.lewis@usda.gov. SUPPLEMENTARY INFORMATION: Classification This proposed rule has been reviewed under Executive Order 12866 and determined not to be significant and has not been reviewed by the Office of Management and Budget (OMB). Programs Affected The Catalog of Federal Domestic Assistance number for the program impacted by this action is 10.768, Business and Industry Loans. Intergovernmental Review Business and Industry Guaranteed Loans are subject to the provisions of Executive Order 12372, which require intergovernmental consultation with State and local officials. RBS will conduct intergovernmental consultation in the manner delineated in and 7 CFR part 3015, subpart V, ‘‘Intergovernmental Review of Rural Development Programs and Activities.’’ Civil Justice Reform This proposed rule has been reviewed under Executive Order 12988, Civil Justice Reform. In accordance with this rule, (1) all State and local laws and regulations that are in conflict with this rule will be preempted; (2) no retroactive effect will be given this rule; and (3) administrative proceedings of the National Appeals Division (7 CFR E:\FR\FM\07APP1.SGM 07APP1 Federal Register / Vol. 70, No. 66 / Thursday, April 7, 2005 / Proposed Rules part 11) must be exhausted before bringing suit in court challenging action taken under this rule. Environmental Impact Statement This document has been reviewed in accordance with 7 CFR part 1940, subpart G, ‘‘Environmental Program.’’ RBS has determined that this action does not constitute a major Federal action significantly affecting the quality of the human environment, and in accordance with the National Environmental Policy Act (NEPA) of 1969, 42 U.S.C. 4321 et seq, this regulation is a Categorical Exclusion. Loan applications will be reviewed individually to determine compliance with NEPA. Unfunded Mandates Reform Act Title II of the Unfunded Mandates Reform Act 1995 (UMRA) of, Pub. L. 104–4 of 1995, establishes requirements for Federal Agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, RBS generally must prepare a written statement, including a costbenefit analysis, for proposed and final rules with ‘‘Federal mandates’’ that may result in expenditures to State, local, or tribal governments, in the aggregate, or to the private sector of $100 million or more in any 1 year. When such a statement is needed for a rule, section 205 of UMRA generally requires RBS to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, more costeffective, or least burdensome alternative that achieves the objectives of the rule. This rule contains no Federal mandates (under the regulatory provisions of Title II of the UMRA) for State, local, and tribal governments or the private sector. Thus, this rule is not subject to the requirements of sections 202 and 205 of the UMRA. Regulatory Flexibility Act In compliance with the Regulatory Flexibility Act, RBS has determined that this action would not have a significant economic impact on a substantial number of small entities, because the action will not affect a significant number of small entities, as defined by the Regulatory Flexibility Act (5 U.S.C. 601). RBS made this determination based on the fact that this regulation only impacts those who choose to participate in the program. Small entity applicants will not be impacted to a greater extent than large entity applicants. VerDate jul<14>2003 15:06 Apr 06, 2005 Jkt 205001 Executive Order 13132 It has been determined that, under Executive Order 13132, Federalism, this rule does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment. The provisions contained in this rule will not have a substantial direct effect on States or their political subdivisions or on the distribution of power and responsibilities among the various levels of government. Executive Order 13175 Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, imposes requirements on USDA in the development of regulatory policies that have tribal implications or preempt tribal laws. USDA has determined that the proposed regulation does not have a substantial direct effect on one or more Indian tribe or on either the relationship or the distribution of powers and responsibilities between the Federal Government and the Indian tribes. Thus, the proposed rule is not subject to the requirements of Executive Order 13175. Paperwork Reduction Act In accordance with the Paperwork Reduction Act of 1995, the Agency will seek OMB approval of the reporting requirements contained in this regulation. These reporting and recordkeeping requirements have been previously approved under OMB control number 0570–0017. The estimate of burden is as follows: Estimate of Burden: Public reporting burden for this collection of information is estimated to average 30 minutes per response. Respondents: Lenders and business owners. Estimated Number of Respondents: 142 (based on 1 year). Estimated Number of Responses per Respondent: 1. Estimated Number of Responses: 142. Estimated Total Annual Burden of Respondents: 71 hours. Copies of this information collection can be obtained from Cheryl Thompson, Regulations and Paperwork Management Branch, Support Services Division at (202) 692–0043. Comments: Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of RBS, including whether the information will have practical utility; (b) the accuracy of RBS’s estimate of the burden of the proposed collection of information including the validity of the methodology and assumptions used; (c) PO 00000 Frm 00008 Fmt 4702 Sfmt 4702 17617 ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of the information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology. Comments may be sent to Cheryl Thompson, Regulations and Paperwork Management Branch, Support Services Division, U.S. Department of Agriculture, Rural Development, STOP 0742, 1400 Independence Ave., SW., Washington DC 20550. All responses to the notice will be summarized and included in the request for OMB approval. All comments will also become a matter of public record. Discussion Pursuant to the Debt Collection Improvement Act of 1996 (DCIA), the Agency is required to send debt owed to the Government to the Department of the Treasury (Treasury) for collection. The DCIA covers both guaranteed and direct loans made by the Agency. Some ambiguity has existed regarding the Agency’s ability to collect from guarantors of the borrower’s loan. This rule will end that ambiguity by clearly making guarantors personally liable for any claims paid by the Government. The Agency proposes to establish more uniformity in the guarantees being obtained by lenders. This should result in the program being administered more consistently and the Government recovering more of its loss claims. Currently, guaranteed lenders prepare non-uniform, personal, or corporate guarantees. When there is a loss on the guaranteed loan, the lender pursues these guarantees with mixed recovery results. By implementing this rule, the Agency will treat all guarantors consistently, collect more money on its loss claims, and rectify any ambiguities regarding its ability to refer these debts to Treasury. List of Subjects in 7 CFR Part 4279 Loan programs—business and industry—rural development assistance, Rural areas. Therefore, chapter XLII, title 7, Code of Federal Regulations, is amended as follows: PART 4279—GUARANTEED LOANMAKING 1. The authority citation for part 4279 continues to read as follows: Authority: 7 U.S.C 1989. E:\FR\FM\07APP1.SGM 07APP1 17618 Federal Register / Vol. 70, No. 66 / Thursday, April 7, 2005 / Proposed Rules Subpart B—Business and Industry Loans DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 2. Section 4279.149 is revised to read as follows: [Docket No. FAA–2005–20882; Directorate Identifier 2004–NM–241–AD] § 4279.149 Personal and Corporate Guarantee. (a) Unconditional personal and corporate guarantees are part of the collateral for the loan but are not considered in determining whether a loan is adequately secured for loanmaking purposes. Agency approved personal and corporate guarantees for the full term of the loan and at least equal to the guarantor’s percent interest in the borrower, times the loan amount are required from those owning greater than a 20 percent interest in the borrower, unless the lender documents to the Agency’s satisfaction that collateral, equity, cashflow, and profitability indicate an above-average ability to repay the loan. The guarantors will execute Form RD 4279–14, ‘‘Unconditional Guarantee.’’ A signature section must be created and in accordance with applicable law. The signature block must include the legal name of the individual or entity signing the Guarantee and, where applicable, the name and title of the authorized representative who will execute the document on its behalf. For instructions on how to complete an enforceable signature block that complies with applicable state law, consult with the Regional Attorney. When warranted by an Agency assessment of potential financial risk, Agency approved guarantees may also be required of parent, subsidiaries, or affiliated companies (owning less than a 20 percent interest in the borrower) and require security for any guarantee provided under this section. (b) Exceptions to the requirement for personal guarantees must be requested by the lender and concurred by the Agency approval official on a case-bycase basis. The lender must document that collateral, equity, cashflow, and profitability indicate an above-average ability to repay the loan. Dated: March 24, 2005. Peter J. Thomas, Administrator, Rural Business—Cooperative Service. [FR Doc. 05–6869 Filed 4–6–05; 8:45 am] BILLING CODE 3410–XY–P VerDate jul<14>2003 15:06 Apr 06, 2005 Jkt 205001 14 CFR Part 39 RIN 2120–AA64 Airworthiness Directives; McDonnell Douglas Model DC–10–10, DC–10–10F, DC–10–15, DC–10–30, DC–10–30F (KC– 10A and KDC–10), DC–10–40, DC–10– 40F, MD–10–10F, MD–10–30F, MD–11, and MD–11F Airplanes Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). AGENCY: SUMMARY: The FAA proposes to adopt a new airworthiness directive (AD) for certain McDonnell Douglas airplanes identified above. This proposed AD would require repetitive functional tests for noisy or improper operation of the exterior emergency control handle assemblies of the mid, overwing, and aft passenger doors, and corrective actions if necessary. This proposed AD also would provide for optional terminating action for the repetitive tests. This proposed AD is prompted by a report that the exterior emergency control mechanism handles were inoperative on a McDonnell Douglas MD–11 airplane. We are proposing this AD to prevent failure of the passenger doors to operate properly in an emergency condition, which could delay an emergency evacuation and possibly result in injury to passengers and flightcrew. DATES: We must receive comments on this proposed AD by May 23, 2005. ADDRESSES: Use one of the following addresses to submit comments on this proposed AD. • DOT Docket Web site: Go to https://dms.dot.gov and follow the instructions for sending your comments electronically. • Government-wide rulemaking Web site: Go to https://www.regulations.gov and follow the instructions for sending your comments electronically. • Mail: Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, room PL–401, Washington, DC 20590. • By fax: (202) 493–2251. • Hand Delivery: Room PL–401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. For service information identified in this proposed AD, contact Boeing PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 Commercial Airplanes, Long Beach Division, 3855 Lakewood Boulevard, Long Beach, California 90846, Attention: Data and Service Management, Dept. C1–L5A (D800– 0024). You can examine the contents of this AD docket on the Internet at https:// dms.dot.gov, or in person at the Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., room PL–401, on the plaza level of the Nassif Building, Washington, DC. This docket number is FAA–2005– 20882; the directorate identifier for this docket is 2004–NM–241–AD. FOR FURTHER INFORMATION CONTACT: Ken Sujishi, Aerospace Engineer; Cabin Safety, Mechanical, and Environmental Branch; ANM–150L; FAA; Los Angeles Aircraft Certification Office; 3960 Paramount Boulevard; Lakewood, California 90712–4137; telephone (562) 627–5353; fax (562) 627–5210. SUPPLEMENTARY INFORMATION: Comments Invited We invite you to submit any relevant written data, views, or arguments regarding this proposed AD. Send your comments to an address listed under ADDRESSES. Include ‘‘Docket No. FAA– 2005–20882; Directorate Identifier 2004–NM–241–AD’’ in the subject line of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments submitted by the closing date and may amend the proposed AD in light of those comments. We will post all comments we receive, without change, to https:// dms.dot.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed AD. Using the search function of that Web site, anyone can find and read the comments in any of our dockets, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). You can review DOT’s complete Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477–78), or you can visit https:// dms.dot.gov. Examining the Docket You can examine the AD docket on the Internet at https://dms.dot.gov, or in person at the Docket Management Facility office between 9 a.m. and 5 p.m., Monday through Friday, except E:\FR\FM\07APP1.SGM 07APP1

Agencies

[Federal Register Volume 70, Number 66 (Thursday, April 7, 2005)]
[Proposed Rules]
[Pages 17616-17618]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-6869]


-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service

Rural Utilities Service

7 CFR Part 4279

RIN 0570-AA54


Business and Industry Guaranteed Loan Program

AGENCY: Rural Business-Cooperative Service, USDA.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Rural Business-Cooperative Service (RBS) proposes to amend 
its regulation for the Business and Industry (B&I) Guaranteed Loans by 
modifying the regulations regarding personal and corporate guarantors. 
This action will standardize the guarantor process. The Agency will 
create a guarantor form which will be used to obtain the personal or 
corporate guarantee of anyone owning greater than 20 percent interest 
in the borrower. The effect of this rule is to allow the Agency to use 
all remedies available to pursue collection from guarantors, including 
offset under the Debt Collection Improvement Act.

DATES: Written or e-mail comments must be received on or before June 6, 
2005, to be assured of consideration.

ADDRESSES: You may submit comments to this rule by any of the following 
methods:
     Agency Web site: https://rdinit.usda.gov/regs/. Follow 
instructions for submitting comments on the Web site.
     E-Mail: comments@usda.gov. Include RIN No. 0570-AA54 in 
the subject line of the message.
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     Mail: Submit written comments via the U.S. Postal Service 
to the Branch Chief, Regulations and Paperwork Management Branch, U.S. 
Department of Agriculture, STOP 0742, 1400 Independence Avenue, SW., 
Washington, DC 20205-0742.
     Hand Delivery/Courier: Submit written comments via Federal 
Express Mail or other courier service requiring a street address to the 
Branch Chief, Regulations and Paperwork Management Branch, U.S. 
Department of Agriculture, 300 7th Street, SW., 7th Floor, Washington, 
DC 20024.
    All written comments will be available for public inspection during 
regular work hours at 300 7th Street, SW., 7th Floor, address listed 
above.

FOR FURTHER INFORMATION CONTACT: David Lewis, Business and Industry 
Loan Servicing Branch, Rural Business-Cooperative Service, U.S. 
Department of Agriculture, STOP 3224, 1400 Independence Avenue, SW., 
Washington, DC 20250-3224, telephone (202) 690-0797, or by e-mail to 
david.lewis@usda.gov.

SUPPLEMENTARY INFORMATION:

Classification

    This proposed rule has been reviewed under Executive Order 12866 
and determined not to be significant and has not been reviewed by the 
Office of Management and Budget (OMB).

Programs Affected

    The Catalog of Federal Domestic Assistance number for the program 
impacted by this action is 10.768, Business and Industry Loans.

Intergovernmental Review

    Business and Industry Guaranteed Loans are subject to the 
provisions of Executive Order 12372, which require intergovernmental 
consultation with State and local officials. RBS will conduct 
intergovernmental consultation in the manner delineated in and 7 CFR 
part 3015, subpart V, ``Intergovernmental Review of Rural Development 
Programs and Activities.''

Civil Justice Reform

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. In accordance with this rule, (1) all State and 
local laws and regulations that are in conflict with this rule will be 
preempted; (2) no retroactive effect will be given this rule; and (3) 
administrative proceedings of the National Appeals Division (7 CFR

[[Page 17617]]

part 11) must be exhausted before bringing suit in court challenging 
action taken under this rule.

Environmental Impact Statement

    This document has been reviewed in accordance with 7 CFR part 1940, 
subpart G, ``Environmental Program.'' RBS has determined that this 
action does not constitute a major Federal action significantly 
affecting the quality of the human environment, and in accordance with 
the National Environmental Policy Act (NEPA) of 1969, 42 U.S.C. 4321 et 
seq, this regulation is a Categorical Exclusion. Loan applications will 
be reviewed individually to determine compliance with NEPA.

Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act 1995 (UMRA) of, Pub. 
L. 104-4 of 1995, establishes requirements for Federal Agencies to 
assess the effects of their regulatory actions on State, local, and 
tribal governments and the private sector. Under section 202 of the 
UMRA, RBS generally must prepare a written statement, including a cost-
benefit analysis, for proposed and final rules with ``Federal 
mandates'' that may result in expenditures to State, local, or tribal 
governments, in the aggregate, or to the private sector of $100 million 
or more in any 1 year. When such a statement is needed for a rule, 
section 205 of UMRA generally requires RBS to identify and consider a 
reasonable number of regulatory alternatives and adopt the least 
costly, more cost-effective, or least burdensome alternative that 
achieves the objectives of the rule. This rule contains no Federal 
mandates (under the regulatory provisions of Title II of the UMRA) for 
State, local, and tribal governments or the private sector. Thus, this 
rule is not subject to the requirements of sections 202 and 205 of the 
UMRA.

Regulatory Flexibility Act

    In compliance with the Regulatory Flexibility Act, RBS has 
determined that this action would not have a significant economic 
impact on a substantial number of small entities, because the action 
will not affect a significant number of small entities, as defined by 
the Regulatory Flexibility Act (5 U.S.C. 601). RBS made this 
determination based on the fact that this regulation only impacts those 
who choose to participate in the program. Small entity applicants will 
not be impacted to a greater extent than large entity applicants.

Executive Order 13132

    It has been determined that, under Executive Order 13132, 
Federalism, this rule does not have sufficient federalism implications 
to warrant the preparation of a Federalism Assessment. The provisions 
contained in this rule will not have a substantial direct effect on 
States or their political subdivisions or on the distribution of power 
and responsibilities among the various levels of government.

Executive Order 13175

    Executive Order 13175, Consultation and Coordination with Indian 
Tribal Governments, imposes requirements on USDA in the development of 
regulatory policies that have tribal implications or preempt tribal 
laws. USDA has determined that the proposed regulation does not have a 
substantial direct effect on one or more Indian tribe or on either the 
relationship or the distribution of powers and responsibilities between 
the Federal Government and the Indian tribes. Thus, the proposed rule 
is not subject to the requirements of Executive Order 13175.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995, the Agency 
will seek OMB approval of the reporting requirements contained in this 
regulation. These reporting and recordkeeping requirements have been 
previously approved under OMB control number 0570-0017. The estimate of 
burden is as follows:
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 30 minutes per response.
    Respondents: Lenders and business owners.
    Estimated Number of Respondents: 142 (based on 1 year).
    Estimated Number of Responses per Respondent: 1.
    Estimated Number of Responses: 142.
    Estimated Total Annual Burden of Respondents: 71 hours.
    Copies of this information collection can be obtained from Cheryl 
Thompson, Regulations and Paperwork Management Branch, Support Services 
Division at (202) 692-0043.
    Comments: Comments are invited on: (a) Whether the proposed 
collection of information is necessary for the proper performance of 
the functions of RBS, including whether the information will have 
practical utility; (b) the accuracy of RBS's estimate of the burden of 
the proposed collection of information including the validity of the 
methodology and assumptions used; (c) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (d) ways 
to minimize the burden of the collection of the information on those 
who are to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology. Comments may be sent to Cheryl 
Thompson, Regulations and Paperwork Management Branch, Support Services 
Division, U.S. Department of Agriculture, Rural Development, STOP 0742, 
1400 Independence Ave., SW., Washington DC 20550. All responses to the 
notice will be summarized and included in the request for OMB approval. 
All comments will also become a matter of public record.

Discussion

    Pursuant to the Debt Collection Improvement Act of 1996 (DCIA), the 
Agency is required to send debt owed to the Government to the 
Department of the Treasury (Treasury) for collection. The DCIA covers 
both guaranteed and direct loans made by the Agency. Some ambiguity has 
existed regarding the Agency's ability to collect from guarantors of 
the borrower's loan. This rule will end that ambiguity by clearly 
making guarantors personally liable for any claims paid by the 
Government.
    The Agency proposes to establish more uniformity in the guarantees 
being obtained by lenders. This should result in the program being 
administered more consistently and the Government recovering more of 
its loss claims. Currently, guaranteed lenders prepare non-uniform, 
personal, or corporate guarantees. When there is a loss on the 
guaranteed loan, the lender pursues these guarantees with mixed 
recovery results. By implementing this rule, the Agency will treat all 
guarantors consistently, collect more money on its loss claims, and 
rectify any ambiguities regarding its ability to refer these debts to 
Treasury.

List of Subjects in 7 CFR Part 4279

    Loan programs--business and industry--rural development assistance, 
Rural areas.

    Therefore, chapter XLII, title 7, Code of Federal Regulations, is 
amended as follows:

PART 4279--GUARANTEED LOANMAKING

    1. The authority citation for part 4279 continues to read as 
follows:

    Authority: 7 U.S.C 1989.

[[Page 17618]]

Subpart B--Business and Industry Loans

    2. Section 4279.149 is revised to read as follows:


Sec.  4279.149  Personal and Corporate Guarantee.

    (a) Unconditional personal and corporate guarantees are part of the 
collateral for the loan but are not considered in determining whether a 
loan is adequately secured for loanmaking purposes. Agency approved 
personal and corporate guarantees for the full term of the loan and at 
least equal to the guarantor's percent interest in the borrower, times 
the loan amount are required from those owning greater than a 20 
percent interest in the borrower, unless the lender documents to the 
Agency's satisfaction that collateral, equity, cashflow, and 
profitability indicate an above-average ability to repay the loan. The 
guarantors will execute Form RD 4279-14, ``Unconditional Guarantee.'' A 
signature section must be created and in accordance with applicable 
law. The signature block must include the legal name of the individual 
or entity signing the Guarantee and, where applicable, the name and 
title of the authorized representative who will execute the document on 
its behalf. For instructions on how to complete an enforceable 
signature block that complies with applicable state law, consult with 
the Regional Attorney. When warranted by an Agency assessment of 
potential financial risk, Agency approved guarantees may also be 
required of parent, subsidiaries, or affiliated companies (owning less 
than a 20 percent interest in the borrower) and require security for 
any guarantee provided under this section.
    (b) Exceptions to the requirement for personal guarantees must be 
requested by the lender and concurred by the Agency approval official 
on a case-by-case basis. The lender must document that collateral, 
equity, cashflow, and profitability indicate an above-average ability 
to repay the loan.

    Dated: March 24, 2005.
Peter J. Thomas,
Administrator, Rural Business--Cooperative Service.
[FR Doc. 05-6869 Filed 4-6-05; 8:45 am]
BILLING CODE 3410-XY-P
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.