    [Appendix]
    [Detailed Budget Estimates by Agency]
    [Small Business Administration]
    [From the U.S. Government Printing Office, www.gpo.gov]

                         THE BUDGET FOR FISCAL YEAR 1999

    [[Page 1011]]

                          SMALL BUSINESS ADMINISTRATION

        The budget provides $724 million in new budget authority for the
    Small Business Administration (SBA). When combined with anticipated
    carryover and decreased loan subsidy costs, this funding level will
    allow SBA to continue to expand assistance to small businesses at a
    reduced cost to the Federal taxpayer.

        In 1999, SBA proposes to continue to increase its reliance on its
    private sector partners. Two ongoing initiatives will allow SBA to
    complete its transition from in-house servicing and liquidating of its
    $45 billion business and disaster loan portfolio to overseeing its
    private sector partners. First, 7(a) General Business lenders will be
    required to service and liquidate all loans approved after 1997. Second,
    SBA will sell its approximately $10 billion portfolio of defaulted
    guarantees and direct loans beginning in 1998. These initiatives will
    allow SBA to focus its limited resources on expanding assistance to
    small businesses while relying on its private sector partners for
    ``back-end'' activities. The budget estimates that these proposals will
    lead to lower credit, administrative, and subsidy costs.

        The budget proposes growth in programs to expand access to capital,
    assist underserved small businesses, and provide education and training.
    As part of SBA's goal of stretching taxpayers' dollars, the budget
    assumes that disaster loan borrowers pay an interest rate equal to the
    rate on Treasury securities of comparable maturity, capped at 6 percent.

                                  Federal Funds

    General and special funds:

                              Salaries and Expenses

        For necessary expenses, not otherwise provided for, of the Small
    Business Administration as authorized by Public Law 103-403, including
    hire of passenger motor vehicles as authorized by 31 U.S.C. 1343 and
    1344, and not to exceed $3,500 for official reception and representation
    expenses, [$254,200,000, of which: $3,000,000 shall be available for a
    grant to Lackawanna County, Pennsylvania for infrastructure development
    to assist in small business development; $3,000,000 shall be available
    for a grant to the NTTC at Wheeling Jesuit University to continue the
    outreach program to assist small business development; $2,000,000 shall
    be for a grant to Western Carolina University to develop a facility to
    assist in small business and rural economic development; $1,500,000
    shall be available for a grant to the State University of New York to
    develop a facility and operate the Institute of Entrepreneurship for
    small business and workforce development; $1,000,000 shall be for a
    grant for the Genesis Small Business Incubator Facility, Fayetteville,
    Arkansas; and $500,000 shall be available for a continuation grant to
    the Center for Entrepreneurial Opportunity in Greensburg, Pennsylvania,
    to provide for small business consulting and assistance] $281,100,000:
    Provided, That the Administrator is authorized to charge fees to cover
    the cost of publications developed by the Small Business Administration,
    and certain loan servicing activities: Provided further, That,
    notwithstanding 31 U.S.C. 3302, revenues received from all such
    activities shall be credited to this account, to be available for
    carrying out these purposes without further appropriations: Provided
    further, That $75,800,000 shall be available to fund grants for
    performance in fiscal year [1998 or fiscal year 1999] 1999 or fiscal
    year 2000 as authorized by section 21 of the Small Business Act, as
    amended. (Departments of Commerce, Justice, and State, the Judiciary,
    and Related Agencies Appropriations Act, 1998.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-0100-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Government contracting and
            minority enterprise development.          21          24          33
    00.02 Disaster assistance...............         113         108         116
    00.03 Economic development..............         125
    00.04 Management and administration.....          75          91          86
    00.05 Executive direction...............           2           3           3
    00.06 General counsel...................           5           5           6
    00.07 Congressional and legislative
            affairs.........................           1           1           1
    00.08 Hearings and appeals..............           1           1           1
    00.09 Communications and publications...           2           3           3
    00.11 Advocacy..........................           5           4           5
    00.12 Field operations..................           4           5           5
    00.13 Equal employment opportunity and
            civil rights compliance.........           2           2           2
    00.14 Regional and district offices.....         123         126         130
    00.15 Chief financial officer...........           9          10          13
    00.16 Capital Access....................                      37          46
    00.17 Entrepreneurial development.......                      93          94
    00.18 Small disadvantaged businesses....                      12          12
                                               ---------   ---------  ----------
    10.00   Total obligations...............         488         525         556
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested.......                       1           1
    22.00 New budget authority (gross)......         493         525         556
    22.30 Unobligated balance expiring......          -4
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         489         526         557
    23.95 New obligations...................        -488        -525        -556
    24.40 Unobligated balance available, end
            of year: Uninvested.............           1           1
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.00   Appropriation...................         235         254         281
          Permanent:

    68.00   Spending authority from
              offsetting collections:
              Offsetting collections (cash).         258         271         275
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         493         525         556
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Uninvested...         182         171         175
    73.10 New obligations...................         488         525         556
    73.20 Total outlays (gross).............        -495        -517        -549
    73.40 Adjustments in expired accounts...          -4          -4          -4
    74.40 Unpaid obligations, end of year:
            Obligated balance: Uninvested...         171         175         177
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority         180         194         215
    86.93 Outlays from current balances.....          55          54          60
    86.97 Outlays from new permanent
            authority.......................         258         271         275
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         495         517         549
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

            Offsetting collections (cash)
                from:
              Federal sources:
    88.00       Payments from business loan
                  program account...........         -94        -111        -109
    88.00       Payments from disaster loan
                  program account...........        -113        -158        -166
    88.00       Reprogramming of disaster
                  loan subsidy..............         -50
    88.40     Non-Federal sources...........          -1          -2
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........        -258        -271        -275
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................         235         254         281
    90.00 Outlays...........................         237         246         274
    ---------------------------------------------------------------------------

        This appropriation funds salaries, other administrative expenses of
    the Small Business Administration (SBA), and business education and
    training programs. The SBA provides assistance to small businesses and
    to victims of natural disasters through these primary program areas:

    [[Page 1012]]

        Capital Access.--The Associate Deputy Administrator (ADA) for this
    function exercises direction over the following SBA program offices:
    Financial Assistance; Surety Bond Guarantees; Investment; and
    International Trade.

        These offices are responsible for the administration of all SBA
    credit and international trade and lending programs. In 1998, SBA plans
    to continue providing business development and financial assistance for
    small business exporters through U.S. Export Assistance Centers. In
    addition, through special programs such as LowDoc, FASTRAK, Microloan,
    and the Export Working Capital Programs (EWCP), SBA is targeting
    financial assistance to segments of the population that have
    historically been under represented in SBA's credit programs. The SBA's
    efforts to reduce unnecessary paperwork and make the agency more
    customer-friendly have attracted new banks interested in establishing
    partnerships with SBA.

        Entrepreneurial Development.--The Associate Deputy Administrator
    (ADA) for this function exercises direction over the following SBA
    program offices: Women's Business Ownership; Small Business Development
    Centers; Veteran's Affairs; Native American Affairs; and, Business
    Initiatives which includes the Service Corps of Retired Executives.
    These programs provide outreach and technical assistance to small
    business communities, especially women, Veterans, and minorities.

        Government Contracting and Minority Enterprise Development.--The
    Associate Deputy Administrator for this function exercises direction
    over the following SBA program offices: Government Contracting; Minority
    Enterprise Development; Technology; and, Size Standards. These offices
    are responsible for effectively advocating for small businesses in the
    area of government contracting and Federal research and development.
    Government contracting activities are aimed at ensuring that small
    businesses receive a fair share of Federal procurement awards. The
    Minority Enterprise Development programs provide assistance to socially
    and economically disadvantaged small business concerns, primarily in the
    areas of business development and Federal procurement. Through this
    office, SBA assists firms that are owned by disadvantaged persons to
    help them develop into viable competitive businesses in a reasonable
    period of time.

        Disaster Assistance.--The Associate Administrator for the Office of
    Disaster Assistance oversees the Disaster Loan Program which provides
    physical disaster loans to individuals and businesses of any size and
    economic injury loans to small businesses unable to obtain credit
    elsewhere. In addition to Presidentially-declared disasters, the program
    provides loans when a declaration is made by the SBA Administrator.
    Program eligibility is based on financial criteria, and interest rates
    are set according to statutory formulas. In recent years, the average
    interest rate on disaster loans has been about four percent. The budget
    proposes to reduce the cost of disaster loan subsidies by increasing the
    interest rate on disaster loans to the Treasury's cost for securities of
    comparable maturities, capped at six percent.

        Advocacy.--The Chief Counsel for Advocacy is charged by law to be an
    independent voice for small business within the government, and to: (1)
    examine the role of small business in the economy and its contribution
    to competition; (2) evaluate financial markets and the credit needs of
    small business; (3) measure the costs of regulation on small business;
    (4) monitor agency compliance with the Regulatory Flexibility Act (RFA),
    as amended by the Small Business Regulatory Enforcement Fairness Act
    (SBREFA); and (5) appear as ``amicus'' in appeals arising from final
    agency regulatory actions, as appropriate.

    Program Performance

        Small Business Development Centers (SBDCs).--The SBDCs provide long
    term counseling to small businesses at about 1,100 locations in 50
    states. In 1997, more than 600,000 customers were helped, of which
    roughly 40 percent were women and 17 percent were minorities. For 1999,
    the budget proposes $75.8 million.

        Service Corps of Retired Executives (SCORE).--Using one-on-one
    counseling and workshops, SCORE reaches about 293,000 business owners
    annually using approximately 12,500 counselors through approximately 400
    chapters located across the country. Counseling costs to the Government
    are less than $3 per hour. For 1999, the budget proposes a funding level
    of $3.5 million for this program. For 1999, the budget proposes $9.5
    million for 7(j) assistance, to assist 8(a) firms, Native American
    communities, Alaskan villages, and other economically distressed areas.

        Minority Enterprise Development Program.--This program provides
    business development assistance and Federal contracting opportunities to
    approximately 6,000 firms. In 1997, over 28,700 contracting actions were
    awarded to small disadvantaged businesses under the agency's 8(a)
    program, amounting to more than $6.3 billion in loans.

        Microloan Technical Assistance.--The Microloan Program technical
    assistance component helps small businesses gain access to non-SBA loans
    and assists SBA's microloan program by providing on-going management
    advice and counseling. The program also helps support the
    Administration's initiative to help individuals receiving welfare
    assistance move to work by providing opportunities to start up small
    businesses using SBA-guaranteed microloans. Microloan Technical
    Assistance grants ensure that microloan borrowers are provided the
    necessary education and training needed for them to succeed. The budget
    provides $16.5 million in Microloan grants.

        Women's Business Centers.--Through this program the SBA makes awards
    to private entities to deliver entrepreneurial training programs for
    women business owners or those interested in starting a business. In
    1997, 63 Women's Business Centers were operating in 36 states,
    Washington, DC, and Puerto Rico. Each offers financial, management,
    marketing and technical assistance to current and potential women
    business owners. The 1999 budget request includes $9 million for this
    program to establish 10 to 12 new sites and to continue two initiatives
    begun in 1996: the Women's Business Intranet (which links all of the
    Women's Business Centers), and a virtual demonstration site on the
    Internet, called the Online Women's Business Center, which will allow
    women nationwide to have access to these services.

        Business Information Centers (BIC).--These centers offer self-help
    hardware, software and reference materials, and on-site counseling
    provided by SCORE volunteers. Individuals who are in business or are
    interested in starting a business will find many resources specifically
    targeted at helping businesses grow or find new market niches. For 1999,
    the budget proposes $500 thousand for this program.

        Native American Affairs.--This program supports the economic
    development needs of reservation communities. In 1997, over 385 loans
    were made to Native Americans under the agency's 7(a) program, amounting
    to more than $72 million in loans.

        Business Assistance Publications.--The SBA provides publications on
    a self-funding basis and distributes an estimated 300,000 items to the
    public each year.

        One Stop Capital Shops (OSCS).--One Stop Capital Shops are located
    in Urban Empowerment Zone, Enterprise Community, and Rural Economic Area
    Partnership communities. The objectives of these programs are to
    stimulate and sustain economic development in these economically
    distressed and underserved areas. The OSCS are a delivery mechanism for

    [[Page 1013]]

    existing SBA programs that emphasize the use of public/private
    relationships. The SBA serves as a catalyst by offering its business
    development and capital resources together in one location with other
    federal, state, local, and private sector resources in order to leverage
    and complement those resources and provide better customer service. For
    1999, the Budget proposes $3.1 million.

        Other Services.--The SBA co-sponsors a variety of special activities
    with the for-profit, not-for-profit, and public sectors. Many co-
    sponsored events cost customers between $35 and $100, with comparable
    commercially-sponsored training costing $300 to $800. Among the most
    visible public/private co-sponsorships undertaken is SBA Online, SBA's
    electronic bulletin board for small businesses. The SBA Online system
    has been principally underwritten by Sprint, which has paid the cost of
    all toll-free connections to the system. Between October, 1992, and
    January, 1997, more than one and three-quarter million connections to
    SBA Online were logged, and more than 120,000 individuals used the
    system on a regular basis.

    Performance Goals

        Program and Policy Goals under the GPRA.--President Clinton has made
    small business formation and growth an essential part of his national
    economic plan. The Small Business Administration has focused on the
    following five program and policy goals as part of the plan: (1)
    increase opportunities for small businesses to succeed, including
    increasing access to capital and business development; (2) transform the
    SBA into a 21st century leading edge financial institution; (3) help
    communities and families recover from disasters; (4) lead small business
    participation in welfare-to-work; and (5) serve as a voice for America's
    small businesses.

        SBA Strategic Plan.--It is the mission of the SBA to serve America's
    small businesses in the most cost effective manner possible to help
    preserve free competition, to contribute to strengthening the Nation's
    economy, and to assist disaster-ravaged communities recover from their
    losses.

        Performance Indicators.--In the long run, the Agency's performance
    goal is true economic development and the capacity to assess how SBA
    assistance contributes to helping small businesses succeed. A variety of
    credit and non-credit business output and outcome measures are included
    in the SBA strategic and annual performance plans to measure progress in
    the following areas: businesses created, maintained, and/or expanded;
    jobs created, and revenues generated; cost effective access to quality
    training, counseling and information; private capital leveraged more
    effectively; improved customer satisfaction; reduced paperwork, more
    understandable regulations, and increased compliance; increased use of
    resource partners and more flexible lending; small businesses receiving
    an increased share of Federal procurement and research; efficient
    delivery of disaster service and a greater satisfaction level; and,
    delivery of SBA programs that ``work better and cost less.''

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-0100-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

          Personnel compensation:

    11.1    Full-time permanent.............         146         154         160
    11.3    Other than full-time permanent..           7           7           7
    11.5    Other personnel compensation....           5           5           5
                                               ---------   ---------  ----------
    11.9      Total personnel compensation..         158         166         172
    12.1  Civilian personnel benefits.......          35          43          44
    21.0  Travel and transportation of
            persons.........................           6           5           5
    22.0  Transportation of things..........           1           1           1
    23.1  Rental payments to GSA............          23          26          28
    23.3  Communications, utilities, and
            miscellaneous charges...........          12           9           9
    24.0  Printing and reproduction.........           1           1           1
    25.2  Other services....................          31          35          50
    26.0  Supplies and materials............           1           1           1
    31.0  Equipment.........................           1           1           1
    41.0  Grants, subsidies, and
            contributions...................         105         117         116
          Undistributed:

    92.0    Undistributed...................                      12          12
    92.0    Undistributed (disaster loan
              making).......................          92          83          91
    92.0    Undistributed (disaster loan
              servicing)....................          22          25          25
                                               ---------   ---------  ----------
    99.9    Total obligations...............         488         525         556
    ---------------------------------------------------------------------------

                                  Personnel Summary

    ----------------------------------------------------------------------------
    Identification code 73-0100-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
    1001  Total compensable workyears: Full-
            time equivalent employment......       4,422       4,578       4,822
    ---------------------------------------------------------------------------
        Note.--The personnel summary includes regular (non-disaster) full-
    time equivalents (FTEs) of 2,964, 3,307, and 3,434 in 1997, 1998, and
    1999 respectively.

                           Office of Inspector General

        For necessary expenses of the Office of Inspector General in
    carrying out the provisions of the Inspector General Act of 1978, as
    amended (5 U.S.C. App. 1-11, as amended by Public Law 100-504),
    [$10,000,000] $11,300,000. (Departments of Commerce, Justice, and State,
    the Judiciary, and Related Agencies Appropriations Act, 1998.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-0200-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Management and counsel............           2           2           2
    00.02 Audit.............................           3           3           3
    00.03 Investigations....................           4           5           5
    00.04 Disaster..........................           1           1           1
                                               ---------   ---------  ----------
    10.00   Total obligations...............          10          11          11
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested.......           1           1
    22.00 New budget authority (gross)......          10          10          11
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          11          11          11
    23.95 New obligations...................         -10         -11         -11
    24.40 Unobligated balance available, end
            of year: Uninvested.............           1
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.00   Appropriation...................           9          10          11
          Permanent:

    68.00   Spending authority from
              offsetting collections:
              Offsetting collections (cash).           1           1
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................          10          11          11
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Uninvested...           1                       2
    73.10 New obligations...................          10          11          11
    73.20 Total outlays (gross).............         -11          -9         -11
    74.40 Unpaid obligations, end of year:
            Obligated balance: Uninvested...                       2           2
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority           8           9          10
    86.93 Outlays from current balances.....           2                       1
    86.97 Outlays from new permanent
            authority.......................           1
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........          11           9          11
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

    88.00   Offsetting collections (cash)
              from: Federal sources.........          -1          -1
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................           9           9          11
    90.00 Outlays...........................          10           8          11
    ---------------------------------------------------------------------------

        This appropriation provides funds for agency-wide audit,
    investigative, and inspection/evaluative functions to identify and
    recommend corrections of management or program defi-

    [[Page 1014]]

    ciencies which may create conditions for fraud, waste, or abuse. The
    audit function provides internal audit, external audit, and inspection/
    evaluation oversight activities. Internal audits assess the general
    management and efficiency of SBA program operations. External audits
    review all program participants and their compliance with SBA
    regulations and procedural requirements. Inspection/evaluations address
    specific requirements of program management and effectiveness. The
    investigative function detects and investigates allegations of illegal
    and improper activities involving agency personnel, programs, and
    operations.

        The 1999 budget requests $11.3 million to support critical oversight
    of SBA's business loan portfolio and other programs. The OIG oversight
    efforts and investigative activities: (1) enhance the SBA's efficiency
    and effectiveness; (2) serve to deter fraud and abuse in agency
    programs; and, (3) consistently demonstrate a high rate of return on
    invested funds.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-0200-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
    11.1  Personnel compensation: Full-time
            permanent.......................           8           9           9
    12.1  Civilian personnel benefits.......           1           2           2
    92.0  Undistributed.....................           1
                                               ---------   ---------  ----------
    99.9    Total obligations...............          10          11          11
    ---------------------------------------------------------------------------

                                  Personnel Summary

    ----------------------------------------------------------------------------
    Identification code 73-0200-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
    1001  Total compensable workyears: Full-
            time equivalent employment......         110         112         116
    ---------------------------------------------------------------------------

    Public enterprise funds:

                      Surety Bond Guarantees Revolving Fund

        For additional capital for the ``Surety Bond Guarantees Revolving
    Fund'', authorized by the Small Business Investment Act, as amended,
    [$3,500,000] $3,300,000, to remain available without fiscal year
    limitation as authorized by 15 U.S.C. 631 note. (Departments of
    Commerce, Justice, and State, the Judiciary, and Related Agencies
    Appropriations Act, 1998.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4156-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct program activity...........           2           2
    09.01 Reimbursable obligations..........           9          11          10
                                               ---------   ---------  ----------
    10.00   Total obligations...............          11          13          10
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested.......           1           2           4
    22.00 New budget authority (gross)......          12          15          15
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          13          17          19
    23.95 New obligations...................         -11         -13         -10
    24.40 Unobligated balance available, end
            of year: Uninvested.............           2           4           9
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.00   Appropriation...................           4           4           3
          Permanent:

    68.00   Spending authority from
              offsetting collections:
              Offsetting collections (cash).           8          11          12
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................          12          15          15
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Uninvested...          41          40          40
    73.10 New obligations...................          11          13          10
    73.20 Total outlays (gross).............         -12         -13         -10
    74.40 Unpaid obligations, end of year:
            Obligated balance: Uninvested...          40          40          40
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority           4           4           3
    86.97 Outlays from new permanent
            authority.......................           8           9           7
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........          12          13          10
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

    88.40   Offsetting collections (cash)
              from: Non-Federal sources.....          -8         -11         -12
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................           4           4           3
    90.00 Outlays...........................           4           2          -2
    ---------------------------------------------------------------------------

        Under this program, the Small Business Administration guarantees a
    portion of the losses sustained by a surety company as a result of the
    issuance of a bid, payment, and/or performance bond to a small business
    concern.

        In 1999, the budget proposes a program level anticipated to
    accommodate expected demand from the preferred surety bond program
    authorized in P.L. 100-590. The SBA will continue to rely on both
    preferred and prior approval sureties to deliver this program, with SBA
    oversight.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4156-0-3-376    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................          16             12            21             21
    0102  Expense...........................         -16            -12           -16            -16
                                            ------------ --------------  ------------  -------------
    0109  Net loss..........................                                        5              5
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4156-0-3-376    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
    1101  Federal assets: Fund balances with
            Treasury........................          43             42            43             43
    1206  Non-Federal assets: Receivables,
            net.............................                                        2              2
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................          43             42            45             45
        LIABILITIES:
    2201  Non-Federal liabilities: Accounts
            payable.........................          41             40            36             36
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............          41             40            36             36
        NET POSITION:
    3100  Appropriated capital..............         321            325           326            326
    3300  Cumulative results of operations..        -320           -323          -317           -317
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............           1              2             9              9
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position          42             42            45             45
    -----------------------------------------------------------------------------------------------

    Credit accounts:

                         Business Loans Program Account

        For the cost of direct loans, $5,724,000; to be available until
    expended, and for [For] the cost of guaranteed loans, [$181,232,000]
    $163,000,000, as authorized by 15 U.S.C. 631 note, of which $45,000,000
    shall remain available until September 30, [1999] 2000: Provided, That
    such costs, including the cost of modifying such loans, shall be as
    defined in section 502 of the Congressional Budget Act of 1974: Provided
    further, That during fiscal year [1998] 1999, commitments to guarantee
    loans under section 503 of the Small Business Investment Act of 1958, as
    amended, shall not exceed [the amount of financings authorized under
    section 20(n)(2)(B) of the Small Business Act, as amended]
    $3,000,000,000[: Provided further, That during fiscal year 1998,
    commitments for general business loans authorized under section 7(a) of
    the Small Business Act, as amended, shall not exceed $10,000,000,000
    without prior notification of the Commit-

    [[Page 1015]]

    tees on Appropriations of the House of Representatives and Senate in
    accordance with section 605 of this Act].
         In addition, for administrative expenses to carry out the direct
    and guaranteed loan programs, $94,000,000, which may be transferred to
    and merged with the appropriations for Salaries and Expenses.
    (Departments of Commerce, Justice, and State, the Judiciary, and Related
    Agencies Appropriations Act, 1998.)

                  Unavailable Collections (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-1154-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Balance, start of year:
    01.99 Balance, start of year............                      16         495
        Receipts:
    02.01 Business loan program downward
            reestimate of subsidy...........          16         479          44
                                               ---------   ---------  ----------
    04.00 Total: Balances and collections...          16         495         539
    07.99 Total balance, end of year........          16         495         539
    ---------------------------------------------------------------------------

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-1154-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct loan subsidy...............           3           2           6
    00.02 Guaranteed loan subsidy...........         186         221         176
    00.07 Reestimate of loan guarantee
            subsidy.........................                     280
    00.08 Interest on reestimates of loan
            guarantee subsidy...............                      23
    00.09 Administrative expenses...........          94          94          94
    00.10 Microloan grants (in S&E).........                       2
                                               ---------   ---------  ----------
    10.00   Total obligations...............         283         622         276
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested.......          62          57          13
    22.00 New budget authority (gross)......         279         578         263
    22.30 Unobligated balance expiring......          -1
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         340         635         276
    23.95 New obligations...................        -283        -622        -276
    24.40 Unobligated balance available, end
            of year: Uninvested.............          57          13
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.00   Appropriation...................         279         275         263
          Permanent:

    60.05   Appropriation (indefinite)......                     303
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         279         578         263
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Uninvested...          93         118         162
    73.10 New obligations...................         283         622         276
    73.20 Total outlays (gross).............        -258        -578        -269
    74.40 Unpaid obligations, end of year:
            Obligated balance: Uninvested...         118         162         169
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority         175         173         166
    86.93 Outlays from current balances.....          83         104         102
    86.97 Outlays from new permanent
            authority.......................                     303
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         258         578         269
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................         279         578         263
    90.00 Outlays...........................         258         578         269
    ---------------------------------------------------------------------------

    Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in
                                millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-1154-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Direct loan levels supportable by subsidy
                    budget authority:
    1150  Micro loans.......................           7          29          60
                                               ---------   ---------  ----------
    1159    Total direct loan levels........           7          29          60
        Direct loan subsidy (in percent):
    1320  Micro loans.......................        8.86       10.31        9.54
                                               ---------   ---------  ----------
    1329    Weighted average subsidy rate...        8.86       10.31        9.54
        Direct loan subsidy budget authority:
    1330  Micro loans.......................           1           3           6
                                               ---------   ---------  ----------
    1339    Total subsidy budget authority..           1           3           6
        Direct loan subsidy outlays:
    1340  Micro loans.......................           1           1           3
                                               ---------   ---------  ----------
    1349    Total subsidy outlays...........           1           1           3
    ----------------------------------------------------------------------------

        Guaranteed loan levels supportable by subsidy
                    budget authority:
    2150  General business--7(a)............       8,956       9,190      11,007
    2150  General business--7(a) DELTA......          31          60         102
    2150  Section 504.......................       1,417       3,000       3,000
    2150  Section 504 DELTA.................           3          27          18
    2150  SBIC debentures...................         139         446         546
    2150  SBIC participating securities.....         234         526         550
    2150  Micro loan guarantees.............           3          10          12
                                               ---------   ---------  ----------
    2159    Total loan guarantee levels.....      10,783      13,259      15,235
        Guaranteed loan subsidy (in percent):
    2320  General business--7(a)............        1.93        2.14        1.39
    2320  General business--7(a) DELTA......        3.47        3.36        2.08
    2320  Section 504.......................        0.00        0.00        0.00
    2320  Section 504 DELTA.................        1.01        0.72        1.29
    2320  SBIC debentures...................        3.19        1.94        1.38
    2320  SBIC participating securities.....        3.29        2.20        2.19
    2320  Micro loan guarantees.............        8.21        8.15        7.97
                                               ---------   ---------  ----------
    2329    Weighted average subsidy rate...        2.12        1.51        1.51
        Guaranteed loan subsidy budget authority:
    2330  General business--7(a)............         173         197         153
    2330  General business--7(a) DELTA......           1           2           2
    2330  Section 504 DELTA.................
    2330  SBIC debentures...................           4           9           8
    2330  SBIC participating securities.....           8          12          12
    2330  Micro loan guarantees.............                       1           1
                                               ---------   ---------  ----------
    2339    Total subsidy budget authority..         186         221         176
        Guaranteed loan subsidy outlays:
    2340  General business--7(a)............         173         186         173
    2340  General business--7(a) DELTA......           1           5           2
    2340  Section 504.......................
    2340  Section 504 DELTA.................
    2340  SBIC debentures...................           4           7           6
    2340  SBIC participating securities.....           7           9           8
    2340  Micro loan guarantees.............                       1           1
                                               ---------   ---------  ----------
    2349    Total subsidy outlays...........         185         208         190
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this account
    records, for this program, the subsidy costs associated with the direct
    loans obligated and loan guarantees committed in 1992 and beyond
    (including modifications of direct loans or loan guarantees that
    resulted from obligations or commitments in any year), as well as
    administrative expenses of this program. The subsidy amounts are
    estimated on a present value basis; the administrative expenses are
    estimated on a cash basis.

        Budget authority is not requested for the section 504 loan program
    in 1999.

        General Business Assistance.--The Small Business Administration
    guarantees loans under its section 7(a) General Business Loan program to
    small businesses that are unable to obtain private financing. These
    loans must be of such value or so secured as to reasonably assure
    repayment. No loan may be made unless the financial assistance is not
    otherwise available on reasonable terms. Under the guarantee plan, the
    SBA agrees to purchase the guaranteed portion of the loan only upon
    default.

        Investment Company Assistance.--A primary function of small business
    investment companies is to provide a source of equity capital or long-
    term loans to new or expanding small businesses. The Small Business
    Investment Act, as amended, authorizes the SBA to guarantee the timely
    payment of all principal and interest, as scheduled, on debentures
    issued by such companies. In addition, since 1994, the SBA has
    guaranteed the performance of participating securities issued by these
    companies.

    [[Page 1016]]

        Development Company Assistance.--Under the Small Business Investment
    Act, the SBA makes loans through State and local development companies
    to small businesses. Through these programs, the SBA promotes economic
    development and job creation and maintenance by stimulating the flow of
    long-term financing to small business concerns for projects involving
    fixed assets. These projects are designed to create or retain a
    meaningful number of jobs in the communities affected, with a special
    emphasis on distressed areas.

    Program Performance

        Program performance and policy goals.--SBA has the following program
    performance and policy objectives to support its first GPRA goal of
    increasing small business opportunities to succeed: (1) focusing lending
    on ``traditionally under-served'' small businesses; (2) offering
    specialized financing, such as venture capital, export financing, and
    bonding opportunities; (3) improving methods of providing credit
    assistance through electronic lending, less documentation, centralized
    functions, and one-stop capital access points; (4) reducing costs by
    maintaining a high quality portfolio through an improved liquidation
    process; and, (5) effectively implementing a loan asset sales program.

        Performance Indicators.--During the past three years SBA has focused
    on quantitative, measureable lending goals for underserved segments of
    the small business market in each of SBA's districts, e.g., minorities,
    women, and small exporters. The SBA began this process in 1994 when it
    established internal performance agreements that contained two-year
    lending goals. Using goal monitoring, the agency is able to track, on a
    regular basis, the status of each district office's progress in meeting
    these goals.

        Appropriate finance program effectiveness assessment involves the
    consideration of a number of indicators. First, effec- tiveness can be
    assessed by loan-making activity levels--the number and dollar amount of
    loans guaranteed by SBA. Second, effectiveness can be measured by the
    health of the loan portfolio--its currency and default figures, and the
    agency's ultimate record on loan recovery. Beyond these very tangible
    indicators of success are the more difficult-to-measure indicators.
    These include such things as the economic benefits that accrue to the
    small business, its employees, and the community in which it is located.

        The number and dollar volume of loans made under the section 7(a)
    loan program has increased dramatically in recent years. In 1992, SBA
    made or guaranteed approximately 24,000 loans totaling about $5.9
    billion. In 1997, the SBA approved approximately 45,000 loans totaling
    about $9.5 billion. The section 504 program has also shown impressive
    growth. In 1992, the SBA provided about 2,000 financings totaling nearly
    $560 million. By 1997, those figures had increased to about 6,900
    financings for $1.4 billion. Performance measures to be used in 1999 to
    assess progress in achieving the above goals follow.

    ------------------------------------------------------------------------
                  Outputs                              Outcomes
    ------------------------------------------------------------------------
     Number and dollar value of   Financial viability:
     guaranteed loans.                    higher percentages of business
     Percentages of loans going   still in business after five
     to underserved markets.              years, and higher percentage of
     Client access to SBA         borrowers who fully repay loans.
     services (customer satisfaction).    Numbers of businesses
     Percentage of loans taken    created, expanded and/or
     that are current.                    maintained.
     More flexible credit         Jobs created and revenue
     delivery instruments developed.      generated.
    ------------------------------------------------------------------------

        Section 7(a): Reflecting ongoing improvement of 7(a) loan portfolio
    performance, SBA's Liquidation Improvement Project, and technical
    refinements that improved SBA's credit subsidy model, the baseline
    (current services) 7(a) subsidy rate declines from 2.19 percent to 1.39
    percent. This decrease is also attributable to improved agency credit
    risk analysis. The budget includes no policy changes to the 7(a) program
    in 1999.

        Section 504: The 1999 subsidy rate reflects further improved 504
    loan performance. The current pass-through fee charged to borrowers will
    be reduced from .775 to .729 to maintain the baseline subsidy rate at
    zero percent.

        Loan asset sales: As part of SBA's transition from loan servicing to
    lender oversight, SBA will sell all direct and defaulted business loans,
    and disaster loans, over the next 3 years. These sales will allow SBA to
    focus its limited resources on expanding access to capital rather than
    servicing and liquidating a growing portfolio. The budget estimates that
    SBA's business loan assets will be sold at a net gain to the Government.

        Microloan Program: The Microloan programs were reauthorized and made
    permanent by P.L. 105-135 in 1997. The Administration is requesting $6.7
    million in subsidy budget authority for these programs in 1999.

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-1154-0-1-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
    25.2  Other services....................          94          96          94
    41.0  Grants, subsidies, and
            contributions...................         189         526         182
                                               ---------   ---------  ----------
    99.9    Total obligations...............         283         622         276
    ---------------------------------------------------------------------------

                     Business Direct Loan Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4148-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct loans......................           6          30          60
    00.02 Interest on Treasury borrowing....          26          28          30
                                               ---------   ---------  ----------
    10.00   Total obligations...............          32          58          90
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested.......         183         260         231
    22.00 New financing authority (gross)...         124          67         114
    22.60 Redemption of debt................         -15         -38         -38
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         292         289         307
    23.95 New obligations...................         -32         -58         -90
    24.40 Unobligated balance available, end
            of year: Uninvested.............         260         231         217
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    67.15 Authority to borrow (indefinite)..          68          10          40
          Spending authority from offsetting
              collections:

    68.00   Offsetting collections (cash)...          47          54          71
    68.10   Change in receivables from
              program account...............           9           3           3
                                               ---------   ---------  ----------
    68.90     Spending authority from
                offsetting collections
                (total).....................          56          57          74
                                               ---------   ---------  ----------
    70.00   Total new financing authority
              (gross).......................         124          67         114
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
          Unpaid obligations, start of year:

    72.40   Obligated balance: Uninvested...          59          34          39
    72.95   Receivables from program account          18          27          30
                                               ---------   ---------  ----------
    72.99     Total unpaid obligations,
                start of year...............          77          61          69
    73.10 New obligations...................          32          58          90
    73.20 Total financing disbursements
            (gross).........................         -48         -50         -61
          Unpaid obligations, end of year:

    74.40   Obligated balance: Uninvested...          34          39          65
    74.95   Receivables from program account          27          30          33
                                               ---------   ---------  ----------

    [[Page 1017]]

    74.99     Total unpaid obligations, end
                of year.....................          61          69          98
    87.00 Total financing disbursements
            (gross).........................          48          50          61
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

            Offsetting collections (cash)
                from:
    88.00     Federal sources: Payments from
                program account.............          -8         -12         -16
    88.25     Interest on uninvested funds..         -19         -20         -21
              Non-Federal sources:
    88.40       Repayments of principal, net         -14         -15         -16
    88.40       Interest received on loans..          -6          -7          -8
    88.40       Proceeds from loan asset
                  sale......................                                 -10
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........         -47         -54         -71
    88.95 Change in receivables from program
            accounts........................          -9          -3          -3
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............          68          10          40
    90.00 Financing disbursements...........          -1          -4         -10
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4148-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on obligations:
    1111  Limitation on direct loans........
    1131  Direct loan obligations exempt
            from limitation.................          24          19          20
                                               ---------   ---------  ----------
    1150    Total direct loan obligations...          24          19          20
    ----------------------------------------------------------------------------

        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........         161         151         137
    1231  Disbursements: Direct loan
            disbursements...................           8          13          30
    1251  Repayments: Repayments and
            prepayments.....................         -14         -15         -16
    1262  Adjustments: Discount on loan
            asset sales to the public or
            discounted......................                      -4         -60
    1264  Write-offs for default: Other
            adjustments, net................          -4          -8          -8
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........         151         137          83
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this non-
    budgetary account records all cash flows to and from the Government
    resulting from direct loans obligated in 1992 and beyond (including
    modifications of direct loans that resulted from obligations in any
    year). The amounts in this account are a means of financing and are not
    included in the budget totals.

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4148-0-3-376    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Investments in US securities:

    1106    Federal assets: Receivables, net         302            310           319            319
          Net value of assets related to
              post-1991 direct loans
              receivable:

    1401    Direct loans receivable, gross..         120            123           137             83
    1405    Allowance for subsidy cost (-)..         -53            -54           -56            -56
                                            ------------ --------------  ------------  -------------
    1499      Net present value of assets
                related to direct loans.....          67             69            81             27
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................         369            379           400            346
        LIABILITIES:
    2104  Federal liabilities: Resources
            payable to Treasury.............         369            379           400            346
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............         369            379           400            346
        NET POSITION:
    3100  Appropriated capital..............
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position         369            379           400            346
    -----------------------------------------------------------------------------------------------

                   Business Guaranteed Loan Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4149-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Default claims....................         396         401         401
    00.02 Payment of downward reestimate to
            receipt account.................                     665
    00.03 Payment to liquidation account....                      83         550
    00.04 Negative subsidy from loan asset
            sales...........................                       2          44
    00.05 Other Expenses....................          42          40          40
                                               ---------   ---------  ----------
    10.00   Total obligations...............         438       1,191       1,035
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested.......       1,307       1,651       1,487
    22.00 New financing authority (gross)...         782       1,027       1,037
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       2,089       2,678       2,524
    23.95 New obligations...................        -438      -1,191      -1,035
    24.40 Unobligated balance available, end
            of year: Uninvested.............       1,651       1,487       1,489
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
          Spending authority from offsetting
              collections:

    68.00   Offsetting collections (cash)...         552       1,027       1,037
    68.10   Change in receivables from
              program account...............         230
                                               ---------   ---------  ----------
    68.90     Spending authority from
                offsetting collections
                (total).....................         782       1,027       1,037
                                               ---------   ---------  ----------
    70.00   Total new financing authority
              (gross).......................         782       1,027       1,037
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
          Unpaid obligations, start of year:

    72.40   Obligated balance: Uninvested...         -51        -150        -150
    72.95   Receivables from program account         126         356         356
                                               ---------   ---------  ----------
    72.99     Total unpaid obligations,
                start of year...............          75         206         206
    73.10 New obligations...................         438       1,191       1,035
    73.20 Total financing disbursements
            (gross).........................        -307      -1,191      -1,035
          Unpaid obligations, end of year:

    74.40   Obligated balance: Uninvested...        -150        -150        -150
    74.95   Receivables from program account         356         356         356
                                               ---------   ---------  ----------
    74.99     Total unpaid obligations, end
                of year.....................         206         206         206
    87.00 Total financing disbursements
            (gross).........................         307       1,191       1,035
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

            Offsetting collections (cash)
                from:
              Federal sources:
    88.00       Payments from program
                  account...................        -187        -179        -179
    88.00       Payment from program
                  account--Reestimates......                    -293
    88.25     Interest on uninvested funds..         -65         -65         -65
              Non-Federal sources:
    88.40       Fees........................        -243        -183        -183
    88.40       Proceeds from loan asset
                  sales.....................                     -83        -386
    88.40       Recoveries..................         -57        -224        -224
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........        -552      -1,027      -1,037
    88.95 Change in receivables from program
            accounts........................        -230
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............
    90.00 Financing disbursements...........        -245         164          -2
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4149-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on commitments:
    2111  Limitation on guaranteed loans
            made by private lenders.........
    2131  Guaranteed loan commitments exempt
            from limitation.................      10,641      11,887      11,660
                                               ---------   ---------  ----------
    2150    Total guaranteed loan
              commitments...................      10,641      11,887      11,660
    ----------------------------------------------------------------------------

        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........      24,630      28,452      32,378
    2231  Disbursements of new guaranteed
            loans...........................       6,955       7,143       7,336
    2251  Repayments and prepayments........      -2,723      -2,796      -2,872

    [[Page 1018]]

    2261  Adjustments: Terminations for
            default that result in loans
            receivable......................        -410        -421        -432
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........      28,452      32,378      36,410
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..      23,282      26,455      29,713
    ----------------------------------------------------------------------------

        Addendum:
          Cumulative balance of defaulted guaranteed
              loans that result in loans receivable:

    2310    Outstanding, start of year......         628         870       1,119
    2331    Disbursements for guaranteed
              loan claims...................         410         421         432
    2351    Repayments of loans receivable..         -63         -65         -67
    2361    Write-offs of loans receivable..        -105        -107        -360
    2364    Other adjustments, net..........                                -440
                                               ---------   ---------  ----------
    2390      Outstanding, end of year......         870       1,119         684
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this non-
    budgetary account records all cash flows to and from the Government
    resulting from loan guarantees committed in 1992 and beyond (including
    modifications of loan guarantees that resulted from commitments in any
    year). The amounts in this account are a means of financing and are not
    included in the budget totals.

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4149-0-3-376    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....       1,257          1,291         1,326          1,326
            Investments in US securities:
    1106      Receivables, net..............         164            168           173            173
          Net value of assets related to
              post-1991 acquired defaulted
              guaranteed loans receivable:

    1501    Defaulted guaranteed loans
              receivable, gross.............         628            870         1,119            684
    1502    Interest receivable.............          45             46            47             47
    1505    Allowance for subsidy cost (-)..        -331           -340          -349           -349
                                            ------------ --------------  ------------  -------------
    1599      Net present value of assets
                related to defaulted
                guaranteed loans............         342            576           817            382
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       1,763          2,035         2,316          1,881
        LIABILITIES:
    2204  Non-Federal liabilities:
            Liabilities for loan guarantees.       1,763          2,035         2,316          1,881
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............       1,763          2,035         2,316          1,881
        NET POSITION:
    3100  Appropriated capital..............
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       1,763          2,035         2,316          1,881
    -----------------------------------------------------------------------------------------------

                     Business Loan Fund Liquidating Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4154-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Interest Expense to Treasury......          70          30          30
    00.02 Defaults on guarantee loans.......         327         318         318
    00.03 Other Expenses....................         184          50          50
                                               ---------   ---------  ----------
    10.00   Total obligations...............         581         398         398
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

            Uninvested:
    21.40     Uninvested....................           1           1
    21.40     Uninvested....................         337         367
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............         338         368
    22.00 New budget authority (gross)......         653         505         972
    22.40 Capital transfer to general fund..                    -434        -533
    22.60 Redemption of debt................         -42         -41         -41
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         949         398         398
    23.95 New obligations...................        -581        -398        -398
          Unobligated balance available, end of year:

            Uninvested:
    24.40     Uninvested....................           1
    24.40     Uninvested....................         367
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................         368
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............         653         505         972
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Uninvested...         389         621         671
    73.10 New obligations...................         581         398         398
    73.20 Total outlays (gross).............        -349        -348        -348
    74.40 Unpaid obligations, end of year:
            Obligated balance: Uninvested...         621         671         721
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................         349         348         348
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

            Offsetting collections (cash)
                from:
    88.00     Federal sources...............                     -83        -550
              Non-Federal sources:
                Loan repayments:

    88.40         Financing programs........        -282        -153        -153
    88.40         Investment programs.......         -37         -28         -28
    88.40         SBIC obligations..........          -5
    88.40         Section 503 development
                    obligations.............         -27         -26         -26
                Interest income:

    88.40         Financing programs........        -120        -117        -117
    88.40         Investment programs.......         -48         -23         -23
    88.40         Other income..............        -124         -65         -65
    88.40         Section 503 Prepayments...         -10         -10         -10
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........        -653        -505        -972
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................        -305        -157        -624
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4154-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
              Business Loan Fund, Direct
                  Loans
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........       1,352       1,050         518
    1232  Disbursements: Purchase of loans
            assets from the public..........         117          90          69
    1251  Repayments: Repayments and
            prepayments.....................        -208        -101         -90
    1262  Adjustments: Discount on loan
            asset sales to the public or
            discounted......................                    -439        -439
    1263  Write-offs for default: Direct
            loans...........................        -211         -82         -58
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........       1,050         518
    ----------------------------------------------------------------------------

              Small Business Investment
                  Company, Direct Loans
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........
    1251  Repayments: Repayments and
            prepayments.....................
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........
    ----------------------------------------------------------------------------

              Section 503 Development
                  Company, Direct Loans
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........         318         275         242
          Repayments:

    1251    Repayments and prepayments......         -28         -20         -18

    [[Page 1019]]

    1252    Proceeds from loan asset sales
              to the public or discounted...         -15         -13        -112
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........         275         242         112
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4154-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
              Business Loan Fund, Loan
                  Guarantees
        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........       6,383       5,341       4,491
    2231  Disbursements of new guaranteed
            loans...........................           1           1           1
    2251  Repayments and prepayments........        -896        -750        -630
          Adjustments:

    2261    Terminations for default that
              result in loans receivable....        -135         -91         -61
    2264    Other adjustments, net..........         -12         -10          -8
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........       5,341       4,491       3,793
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..       4,598       3,866       3,263
    ----------------------------------------------------------------------------

        Addendum:
          Cumulative balance of defaulted guaranteed
              loans that result in loans receivable:

    2310    Outstanding, start of year......       1,255       1,390       1,331
    2331    Disbursements for guaranteed
              loan claims...................         135          91          61
    2361    Write-offs of loans receivable..                     -67        -450
    2364    Other adjustments, net..........                     -83        -550
                                               ---------   ---------  ----------
    2390      Outstanding, end of year......       1,390       1,331         392
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this account
    records, for this program, all cash flows to and from the Government
    resulting from direct loans obligated and loan guarantees committed
    prior to 1992. This account is shown on a cash basis. All new activity
    in this program in 1992 and beyond (including modifications of direct
    loans or loan guarantees that resulted from obligations or commitments
    in any year) is recorded in corresponding program and financing
    accounts.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4154-0-3-376    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................         189            191           234            220
    0102  Expense...........................         149           -134          -184           -160
                                            ------------ --------------  ------------  -------------
    0109  Net loss..........................         338             57            50             60
    -----------------------------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4154-0-3-376    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

    1101    Fund balances with Treasury.....         727            794           866            866
            Investments in US securities:
    1104      Agency securities, par........         160            214           286            286
    1107      Advances and prepayments......           9              7             5              5
          Non-Federal assets:

    1206    Receivables, net................         816            780           745            745
    1207    Advances and prepayments........           7              7             7              7
          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............       1,671          1,325           760            112
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................      -1,114           -787          -401           -401
                                            ------------ --------------  ------------  -------------
    1699      Value of assets related to
                direct loans................         557            538           359           -289
    1901  Other Federal assets: Other assets          61             37            23             23
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       2,337          2,377         2,291          1,643
        LIABILITIES:
          Federal liabilities:

    2101    Accounts payable................       1,667          1,694         1,604          1,056
    2102    Interest payable................          94             96            96             96
            Debt:
    2103      Debt to the FFB...............         318            325           327            227
    2103      SBIC and development company
                participation certificates..           7              7             7              7
          Non-Federal liabilities:

    2201    Accounts payable................          15             15            15             15
    2204    Liabilities for loan guarantees.          71             72            73             73
    2207    Other Liabilities...............         165            168           169            169
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............       2,337          2,377         2,291          1,643
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       2,337          2,377         2,291          1,643
    -----------------------------------------------------------------------------------------------

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4154-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
    42.0  Insurance claims and indemnities..         511         368         368
    43.0  Interest and dividends............          70          30          30
                                               ---------   ---------  ----------
    99.9    Total obligations...............         581         398         398
    ---------------------------------------------------------------------------

                         Disaster Loans Program Account

        [For the cost of direct loans authorized by section 7(b) of the
    Small Business Act, as amended, $23,200,000, to remain available until
    expended: Provided, That such costs, including the cost of modifying
    such loans, shall be as defined in section 502 of the Congressional
    Budget Act of 1974.]
        [In addition, for] For administrative expenses to carry out the
    direct loan program, [$150,000,000, including not to exceed $500,000 for
    the Office of Inspector General of the Small Business Administration for
    audits and reviews of disaster loans and the disaster loan program, and
    said sums shall be transferred to and merged with appropriations for the
    Office of Inspector General] $166,000,000, which may be transferred to
    and merged with appropriations for Salaries and Expenses. (Departments
    of Commerce, Justice, and State, the Judiciary, and Related Agencies
    Appropriations Act, 1998.)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-1152-0-1-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct loan subsidy...............         192         184          53
    00.05 Upward reestimate of direct loan
            subsidy.........................                      33
    00.06 Interest on direct loan subsidy...                       3
    00.09 Administrative expense............         164         158         166
                                               ---------   ---------  ----------
    10.00   Total obligations...............         356         378         219
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested.......         164         190          56
    22.00 New budget authority (gross)......         327         209         166
    22.10 Resources available from
            recoveries of prior year
            obligations.....................          55          35          20
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         546         434         242
    23.95 New obligations...................        -356        -378        -219
    24.40 Unobligated balance available, end
            of year: Uninvested.............         190          56          23
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
          Current:

    40.00   Appropriation...................         327         173         166
          Permanent:

    60.05   Appropriation (indefinite)......                      36
                                               ---------   ---------  ----------
    70.00   Total new budget authority
              (gross).......................         327         209         166
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Uninvested...         123          70          98
    73.10 New obligations...................         356         376         219
    73.20 Total outlays (gross).............        -354        -315        -246
    73.45 Adjustments in unexpired accounts.         -55         -35         -20
    74.40 Unpaid obligations, end of year:
            Obligated balance: Uninvested...          70          98          51
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.90 Outlays from new current authority         217         133         128
    86.93 Outlays from current balances.....         137         182         118
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         354         315         246
    ----------------------------------------------------------------------------

    [[Page 1020]]

        Net budget authority and outlays:
    89.00 Budget authority..................         327         209         166
    90.00 Outlays...........................         354         315         246
    ---------------------------------------------------------------------------

    Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in
                                millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-1152-0-1-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Direct loan levels supportable by subsidy
                    budget authority:
    1150  Direct Disaster Loans.............         961         785         237
                                               ---------   ---------  ----------
    1159    Total direct loan levels........         961         785         237
        Direct loan subsidy (in percent):
    1320  Subsidy rate......................       20.02       23.46       22.36
                                               ---------   ---------  ----------
    1329    Weighted average subsidy rate...       20.02       23.46       22.36
        Direct loan subsidy budget authority:
    1330  Disaster subsidy budget authority.         192         184          53
                                               ---------   ---------  ----------
    1339    Total subsidy budget authority..         192         184          53
        Direct loan subsidy outlays:
    1340  Disaster subsidy outlays..........         190         159          70
                                               ---------   ---------  ----------
    1349    Total subsidy outlays...........         190         159          70
    ----------------------------------------------------------------------------

        Administrative expense data:
    3510  Budget authority..................         164         156         166
    3590  Outlays from new authority........         164         156         166
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this account
    records, for loans made pursuant to section 7(b) of the Small Business
    Act, as amended, the subsidy costs associated with the direct loans
    obligated in 1992 and beyond (including modifications of direct loans or
    loan guarantees that resulted from obligations or commitments in any
    year), as well as administrative expenses of this program. The subsidy
    amounts are estimated on a present value basis; the administrative
    expenses are estimated on a cash basis.

        Disaster loans made pursuant to Section 7(b) of the Small Business
    Act are the primary form of Federal assistance for non-farm, private
    sector disaster losses. For this reason, the program is the only form of
    SBA assistance not limited to small businesses. Through this program,
    SBA helps homeowners, renters, businesses of all sizes, and non-profit
    organizations pay for the cost of rebuilding. Pursuant to the Small
    Business Act, the government subsidizes borrowers who have incurred
    uninsured losses or economic injury as the result of a natural disaster.
    These loans are also a critical source of economic stimulation in
    disaster-ravaged communities, helping to spur employment and stabilize
    the local tax base. Eligibility is based on financial criteria. There
    are three loan programs: physical disaster loans to individuals;
    physical disaster loans to businesses of any size; and, economic injury
    loans to small businesses without credit available elsewhere.

    Program Performance

        Over the 42 year history of the program, SBA has helped almost 1.3
    million disaster victims by providing more than $25 billion in disaster
    assistance. Over 90 percent has been to borrowers that otherwise would
    not have been able to rebuild. During 1997 alone, SBA approved nearly
    30,000 disaster loans, exceeding $1 billion to homeowners, renters, and
    businesses.

        Program Performance and Policy Goals.--The SBA program performance
    and policy goals are to: 1) provide disaster assistance to victims in
    the most effective and cost efficient manner; 2) deliver an effective
    program that achieves its public policy objectives; 3) provide customer-
    focused assistance that satisfactorily accommodates the needs of all
    disaster victims; 4) simplify and streamline the loan-making process by
    re-engineering forms, procedures and processes; and, 5) effectively
    implement the proposed asset sales program.

        Performance Indicators.--A true assessment of program effectivess is
    a long-term process, and there is much to learn about the true extent
    that the disaster loan program contributes to effective recovery. In the
    short term, SBA is committed to providing cost-effective delivery and
    high satisfaction levels to the customers who use its services. In the
    long run, the agency's goal is to facilitate true economic recovery and
    assess how the program's business recovery assistance contributes to the
    rebuilding of a local or regional economy. Performance measures to be
    used in 1998 to assess progress in achieving the above goals follow.

    ------------------------------------------------------------------------
                      Outputs                       Intermediate Outcomes
    ------------------------------------------------------------------------
    Loan decision within 7 to 20 days--number,  Increased funds available at
     percent.                                    time of need.
    Initial disbursement ordered 4 days after   Improved customer
     receipt of loan closing documents--         satisfaction due to
     number, percent.                            simplified and less
                                                 burdensome processes.
    Loans approved--number, dollar              Reduced costs to Government.
      amount.
    ------------------------------------------------------------------------

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-1152-0-1-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
    25.2  Other services....................         164         158         166
    41.0  Grants, subsidies, and
            contributions...................         192         220          53
                                               ---------   ---------  ----------
    99.9    Total obligations...............         356         378         219
    ---------------------------------------------------------------------------

                         Disaster Loans Program Account

                  (Legislative proposal, not subject to PAYGO)

    Summary of Loan Levels, Subsidy Budget Authority and Outlays by Program (in
                                millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-1152-2-1-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Direct loan levels supportable by subsidy
                    budget authority:
    1150  Direct Disaster Loans.............                                 664
                                               ---------   ---------  ----------
    1159    Total direct loan levels........                                 664
        Direct loan subsidy (in percent):
    1320  Subsidy rate......................                              -16.43
                                               ---------   ---------  ----------
    1329    Weighted average subsidy rate...                              -16.43
        Direct loan subsidy budget authority:
    1330  Disaster subsidy budget authority.
                                               ---------   ---------  ----------
    1339    Total subsidy budget authority..
        Direct loan subsidy outlays:
    1340  Disaster subsidy outlays..........
                                               ---------   ---------  ----------
    1349    Total subsidy outlays...........
    ---------------------------------------------------------------------------

        Under current law, the interest rates on Small Business
    Administration (SBA) disaster loans are set by statutory formulas. A
    lower rate, not to exceed four percent, is available to applicants
    without credit available from private lenders. A higher rate, not to
    exceed eight percent, is charged to borrowers who have credit available
    from private sources. To create a stronger incentive for households and
    businesses to plan for and to mitigate against the costs of disasters
    and to reduce the costs of these loans to the Government, the budget
    proposes to increase the interest rate on SBA disaster loans to the U.S.
    Treasury's cost for securities of comparable maturity, subject to a cap
    of six percent. For borrowers with access to credit elsewhere, the
    interest rate would be pegged above the comparable Treasury rate. These
    changes would reduce the subsidy for these loans from 22.36 percent to
    5.93 percent, which will allow more loans to be provided with a given
    amount of budget authority.

    [[Page 1021]]

        In 1999, this proposal would allow the estimated volume of $901
    million in disaster loans to be financed entirely with unobligated
    balances carried forward from 1998. As a result, no appropriation of new
    budget authority is requested for the Disaster Loan Program Account for
    1999. Without the proposed increase in interest rates, the carryover
    from 1998 would finance only $237 million of new disaster loans in 1999.

                     Disaster Direct Loan Financing Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4150-0-3-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct loans......................         961         785         287
    00.02 Interest on Treasury borrowing....         589         477         547
    00.03 Payment of downward reestimate to
            receipt account.................                     294
    00.04 Payment of interest on downward
            reestimates to receipt account..                      96
    00.10 Asset sale payment to liquidating
            account.........................                                 421
                                               ---------   ---------  ----------
    10.00   Total obligations...............       1,550       1,652       1,255
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested.......       4,195       4,003       4,003
    22.00 New financing authority (gross)...       1,550       1,652       1,468
    22.60 Redemption of debt................        -192
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......       5,553       5,655       5,471
    23.95 New obligations...................      -1,550      -1,652      -1,255
    24.40 Unobligated balance available, end
            of year: Uninvested.............       4,003       4,003       4,216
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    67.15 Authority to borrow (indefinite)..       1,550       1,560         834
          Spending authority from offsetting
              collections:

    68.00   Offsetting collections (cash)...         841       1,298       1,516
    68.10   Change in receivables from
              program account...............         -25          -4         -58
    68.47   Portion applied to debt
              reduction (-).................        -816      -1,202        -824
                                               ---------   ---------  ----------
    68.90     Spending authority from
                offsetting collections
                (total).....................                      92         634
                                               ---------   ---------  ----------
    70.00   Total new financing authority
              (gross).......................       1,550       1,652       1,468
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
          Unpaid obligations, start of year:

    72.40   Obligated balance: Uninvested...         605         992       1,037
    72.95   Receivables from program account         122          97          93
                                               ---------   ---------  ----------
    72.99     Total unpaid obligations,
                start of year...............         727       1,089       1,130
    73.10 New obligations...................       1,550       1,652       1,255
    73.20 Total financing disbursements
            (gross).........................      -1,188      -1,611        -682
          Unpaid obligations, end of year:

    74.40   Obligated balance: Uninvested...         992       1,037       1,668
    74.95   Receivables from program account          97          93          35
                                               ---------   ---------  ----------
    74.99     Total unpaid obligations, end
                of year.....................       1,089       1,130       1,703
    87.00 Total financing disbursements
            (gross).........................       1,188       1,611         682
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

            Offsetting collections (cash)
                from:
              Federal sources:
    88.00       Payments from program
                  account...................        -192        -184         -53
    88.00       Payments from program
                  account--Reestimates......                    -390
              Non-Federal sources:
    88.40       Repayments of principal, net        -123        -161        -208
    88.40       Interest received on loans..        -526        -563        -621
    88.40       Proceeds from loan sales....                                -634
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........        -841      -1,298      -1,516
    88.95 Change in receivables from program
            accounts........................          25           4          58
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............         734         358          10
    90.00 Financing disbursements...........         347         313        -834
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4150-0-3-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on obligations:
    1111  Limitation on direct loans........
    1131  Direct loan obligations exempt
            from limitation.................         961         785         901
                                               ---------   ---------  ----------
    1150    Total direct loan obligations...         961         785         901
    ----------------------------------------------------------------------------

        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........       7,227       7,891       8,027
    1231  Disbursements: Direct loan
            disbursements...................       1,168         744         135
          Repayments:

    1251    Repayments and prepayments......        -427        -502        -665
    1252    Proceeds from loan asset sales
              to the public or discounted...                                -213
    1264  Write-offs for default: Other
            adjustments, net................         -77        -106        -116
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........       7,891       8,027       7,168
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this non-
    budgetary account records all cash flows to and from the Government
    resulting from direct loans obligated in 1992 and beyond (including
    modifications of direct loans that resulted from obligations in any
    year). The amounts in this account are a means of financing and are not
    included in the budget totals.

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4150-0-3-453    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Federal assets:

            Investments in US securities:
              Receivables, net:
    1106        Program account.............         227            146            32              6
    1106        Interest Receivables........                      1,984         1,772          1,928
          Net value of assets related to
              post-1991 direct loans
              receivable:

    1401    Direct loans receivable, gross..       7,227          7,891         8,027          7,168
    1405    Allowance for subsidy cost (-)..        -248           -192          -184            -53
                                            ------------ --------------  ------------  -------------
    1499      Net present value of assets
                related to direct loans.....       6,979          7,699         7,843          7,115
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       7,206          9,829         9,647          9,049
        LIABILITIES:
    2104  Federal liabilities: Resources
            payable to Treasury.............       6,979          9,683         9,615          9,043
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............       6,979          9,683         9,615          9,043
        NET POSITION:
    3100  Appropriated capital..............         227            146            32              6
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............         227            146            32              6
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       7,206          9,829         9,647          9,049
    -----------------------------------------------------------------------------------------------

                     Disaster Direct Loan Financing Account

                  (Legislative proposal, not subject to PAYGO)

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4150-2-3-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct loans......................                                 664
    00.02 Interest on Treasury borrowing....                                   7
                                               ---------   ---------  ----------
    10.00   Total obligations...............                                 671
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    22.00 New financing authority (gross)...                                 671
    23.95 New obligations...................                                -671
    ----------------------------------------------------------------------------

        New financing authority (gross), detail:
    67.15 Authority to borrow (indefinite)..                                 679
          Spending authority from offsetting
              collections:

    68.00   Offsetting collections (cash)...                                  48
    68.47   Portion applied to debt
              reduction (-).................                                 -56
                                               ---------   ---------  ----------

    [[Page 1022]]

    68.90     Spending authority from
                offsetting collections
                (total).....................                                  -8
                                               ---------   ---------  ----------
    70.00   Total new financing authority
              (gross).......................                                 671
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................                                 671
    73.20 Total financing disbursements
            (gross).........................                                -470
    74.40 Unpaid obligations, end of year:
            Obligated balance: Uninvested...                                 201
    87.00 Total financing disbursements
            (gross).........................                                 470
    ----------------------------------------------------------------------------

        Offsets:
          Against gross financing authority and
              financing disbursements:

            Offsetting collections (cash)
                from:
              Non-Federal sources:
    88.40       Repayments of principal, net                                  -2
    88.40       Interest received on loans..                                 -46
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........                                 -48
    ----------------------------------------------------------------------------

        Net financing authority and financing
            disbursements:
    89.00 Financing authority...............                                 623
    90.00 Financing disbursements...........                                 422
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4150-2-3-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Position with respect to appropriations act
                    limitation on obligations:
    1111  Limitation on direct loans........
    1131  Direct loan obligations exempt
            from limitation.................                                 615
                                               ---------   ---------  ----------
    1150    Total direct loan obligations...                                 615
    ----------------------------------------------------------------------------

        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........
    1231  Disbursements: Direct loan
            disbursements...................                                 398
    1251  Repayments: Repayments and
            prepayments.....................                                 -41
    1264  Write-offs for default: Other
            adjustments, net................                                  -9
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........                                 348
    ---------------------------------------------------------------------------

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4150-2-3-453    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
          Net value of assets related to
              post-1991 direct loans
              receivable:

    1401    Direct loans receivable, gross..                                                     298
                                            ------------ --------------  ------------  -------------
    1499      Net present value of assets
                related to direct loans.....                                                     298
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................                                                     298
        LIABILITIES:
    2104  Federal liabilities: Resources
            payable to Treasury.............                                                     298
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............                                                     298
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position                                                     298
    -----------------------------------------------------------------------------------------------

                     Disaster Loan Fund Liquidating Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4153-0-3-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    01.01 Interest expense to Treasury......          68          58          38
    01.03 Other expenses....................          27           8           6
                                               ---------   ---------  ----------
    10.00   Total obligations...............          95          66          44
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
    21.40 Unobligated balance available,
            start of year: Uninvested.......         177         221
    22.00 New budget authority (gross)......         313         258         615
    22.40 Capital transfer to general fund..        -174        -413        -571
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......         316          66          44
    23.95 New obligations...................         -95         -66         -44
          Unobligated balance available, end of year:

            Uninvested:
    24.40     Uninvested....................           1
    24.40     Uninvested....................         220
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................         221
    ----------------------------------------------------------------------------

        New budget authority (gross), detail:
    68.00 Spending authority from offsetting
            collections (gross): Offsetting
            collections (cash)..............         313         258         615
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    72.40 Unpaid obligations, start of year:
            Obligated balance: Uninvested...          79          70          67
    73.10 New obligations...................          95          66          44
    73.20 Total outlays (gross).............        -104         -69         -64
    74.40 Unpaid obligations, end of year:
            Obligated balance: Uninvested...          70          67          47
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.97 Outlays from new permanent
            authority.......................          95          64          60
    86.98 Outlays from permanent balances...           9           5           4
                                               ---------   ---------  ----------
    87.00   Total outlays (gross)...........         104          69          64
    ----------------------------------------------------------------------------

        Offsets:
          Against gross budget authority and outlays:

            Offsetting collections (cash)
                from:
              Non-Federal sources:
    88.40       Loan repayments.............        -198        -192        -149
    88.40       Interest income.............         -72         -58         -38
    88.40       Other income................         -43          -8          -7
    88.40       Recovery on Loan
                  Cancellations.............
    88.40       Proceeds from loan asset
                  sales.....................                                -421
                                               ---------   ---------  ----------
    88.90       Total, offsetting
                  collections (cash)........        -313        -258        -615
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................        -209        -189        -551
    ---------------------------------------------------------------------------

                   Status of Direct Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4153-0-3-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Cumulative balance of direct loans
                    outstanding:
    1210  Outstanding, start of year........       1,677       1,457       1,230
          Repayments:

    1251    Repayments and prepayments......        -199        -192        -149
    1252    Proceeds from loan asset sales
              to the public or discounted...                                -421
    1263  Write-offs for default: Direct
            loans...........................         -21         -35         -27
                                               ---------   ---------  ----------
    1290    Outstanding, end of year........       1,457       1,230         633
    ---------------------------------------------------------------------------

        As required by the Federal Credit Reform Act of 1990, this account
    records, for this program, all cash flows to and from the Government
    resulting from direct loans obligated prior to 1992. This account is
    shown on a cash basis. All new activity in this program in 1992 and
    beyond (including modifications of direct loans or loan guarantees that
    resulted from obligations or commitments in any year) is recorded in
    corresponding program and financing accounts.

                            Statement of Operations (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4153-0-3-453    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
    0101  Revenue...........................          93             72            65            103
    0102  Expense...........................        -102            -78           -77            -90
                                            ------------ --------------  ------------  -------------
    0109  Net income or loss (-)............          -9             -6           -12             13
    -----------------------------------------------------------------------------------------------

    [[Page 1023]]

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4153-0-3-453    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
    1101  Federal assets: Fund balances with
            Treasury........................         256            290           255            235
    1206  Non-Federal assets: Receivables,
            net.............................         111             75            59             39
          Net value of assets related to
              pre-1992 direct loans
              receivable and acquired
              defaulted guaranteed loans
              receivable:

    1601    Direct loans, gross.............       1,677          1,457         1,230            633
    1603    Allowance for estimated
              uncollectible loans and
              interest (-)..................        -129           -107           -93            -87
                                            ------------ --------------  ------------  -------------
    1699      Value of assets related to
                direct loans................       1,548          1,350         1,137            546
          Other Federal assets:

    1801    Cash and other monetary assets..                          4             1              1
    1803    Property, plant and equipment,
              net...........................           5
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................       1,920          1,719         1,452            821
        LIABILITIES:
    2102  Federal liabilities: Interest
            payable.........................          78             68            52             40
    2201  Non-Federal liabilities: Accounts
            payable.........................       1,842          1,651         1,400          1,102
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............       1,920          1,719         1,452          1,142
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position       1,920          1,719         1,452          1,142
    -----------------------------------------------------------------------------------------------

                   Object Classification (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4153-0-3-453      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
    25.2  Other services....................          27           8           6
    43.0  Interest and dividends............          68          58          38
                                               ---------   ---------  ----------
    99.9    Total obligations...............          95          66          44
    ---------------------------------------------------------------------------

              Pollution Control Equipment Fund Liquidating Account

                   Program and Financing (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4147-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------

        Obligations by program activity:
    00.01 Direct program....................           1
                                               ---------   ---------  ----------
    10.00   Total obligations (object class
              42.0).........................           1
    ----------------------------------------------------------------------------

        Budgetary resources available for obligation:
          Unobligated balance available, start of year:

            Uninvested:
    21.40     Uninvested....................          14          12
    21.40     Uninvested....................          -1
                                               ---------   ---------  ----------
    21.99     Total unobligated balance,
                start of year...............          13          12
    22.40 Capital transfer to general fund..                     -12
                                               ---------   ---------  ----------
    23.90   Total budgetary resources
              available for obligation......          13
    23.95 New obligations...................          -1
          Unobligated balance available, end of year:

            Uninvested:
    24.40     Uninvested....................          12
    24.40     Uninvested....................
                                               ---------   ---------  ----------
    24.99   Total unobligated balance, end
              of year.......................          12
    ----------------------------------------------------------------------------

        Change in unpaid obligations:
    73.10 New obligations...................           1
    73.20 Total outlays (gross).............          -1
    ----------------------------------------------------------------------------

        Outlays (gross), detail:
    86.98 Outlays from permanent balances...           1
    ----------------------------------------------------------------------------

        Net budget authority and outlays:
    89.00 Budget authority..................
    90.00 Outlays...........................
    ---------------------------------------------------------------------------

                 Status of Guaranteed Loans (in millions of dollars)

    ----------------------------------------------------------------------------
    Identification code 73-4147-0-3-376      1997 actual   1998 est.   1999 est.
    ----------------------------------------------------------------------------
        Cumulative balance of guaranteed loans
                    outstanding:
    2210  Outstanding, start of year........          86          76          65
          Adjustments:

    2261    Terminations for default that
              result in loans receivable....                      -1
    2264    Other adjustments, net..........         -10         -10         -11
                                               ---------   ---------  ----------
    2290    Outstanding, end of year........          76          65          54
    ----------------------------------------------------------------------------

        Memorandum:
    2299  Guaranteed amount of guaranteed
            loans outstanding, end of year..          76          65          54
    ----------------------------------------------------------------------------

        Addendum:
          Cumulative balance of defaulted guaranteed
              loans that result in loans receivable:

    2310    Outstanding, start of year......          47          48          43
    2331    Disbursements for guaranteed
              loan claims...................           1           1
    2351    Repayments of loans receivable..                      -6
                                               ---------   ---------  ----------
    2390      Outstanding, end of year......          48          43          43
    ---------------------------------------------------------------------------

        Public Law 94-305 established this fund to alleviate the adverse
    impact of pollution regulations on small businesses. As a result of the
    elimination of tax exempt financing associated with the Pollution
    Control Guaranteed program, no new activity is anticipated for this
    program.

        During 1992, the Small Business Administration started the process
    of redeeming a large number of outstanding bonds on which it has taken
    over loan payments. Most of these targeted bonds are ten years old and
    voluntary redemption is now viable under the bond documents. Redemption
    of these obligations would preclude the SBA from paying excessive
    interest over the next ten years.

                                 Balance Sheet (in millions of dollars)

    -----------------------------------------------------------------------------------------------
    Identification code   73-4147-0-3-376    1996 actual    1997 actual     1998 est.      1999 est.
    -----------------------------------------------------------------------------------------------
        ASSETS:
    1101  Federal assets: Fund balances with
            Treasury........................          13             13            12             10
    1206  Non-Federal assets: Receivables,
            net.............................           9              9             9              9
    1701  Net value of assets related to
            pre-1992 direct loans receivable
            and acquired defaulted
            guaranteed loans receivable:
            Defaulted guaranteed loans,
            gross...........................           6              6             8              8
                                            ------------ --------------  ------------  -------------
    1999    Total assets....................          28             28            29             27
        LIABILITIES:
    2104  Federal liabilities: Resources
            payable to Treasury.............          28             18            22             21
    2201  Non-Federal liabilities: Accounts
            payable.........................
                                            ------------ --------------  ------------  -------------
    2999    Total liabilities...............          28             18            22             21
        NET POSITION:
    3100  Appropriated capital..............
    3300  Cumulative results of operations..
    3600  Other.............................           1             10             7              6
                                            ------------ --------------  ------------  -------------
    3999    Total net position..............           1             10             7              6
                                            ------------ --------------  ------------  -------------
    4999  Total liabilities and net position          29             28            29             27
    -----------------------------------------------------------------------------------------------

             Administrative Provision--Small Business Administration

        Not to exceed 5 percent of any appropriation made available for the
    current fiscal year for the Small Business Administration in this Act
    may be transferred between such appropriations, but no such
    appropriation shall be increased by more than 10 percent by any such
    transfers: Provided, That any transfer pursuant to this paragraph shall
    be treated as a reprogramming of funds under section 605 of this Act and
    shall not be available for obligation or expenditure except in
    compliance with the procedures set forth in that section. (Departments
    of Commerce, Justice, and State, the Judiciary, and Related Agencies
    Appropriations Act, 1998.)