[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.)