[Federal Register Volume 60, Number 159 (Thursday, August 17, 1995)]
[Rules and Regulations]
[Page 42781]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-20433]



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SMALL BUSINESS ADMINISTRATION
13 CFR Part 122


Business Loans--Microloans

AGENCY: Small Business Administration (SBA).

ACTION: Final rule.

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SUMMARY: Section 7(m) of the Small Business Act (15 U.S.C. 636(m)) 
(Act) authorizes the SBA to operate a microloan demonstration program 
(Program) under which the SBA lends funds to qualified intermediaries 
which re-lend amounts of $25,000 or less to eligible small business 
concerns. Under this final rule, an intermediary would be allowed to 
operate across state lines with the written approval of the SBA 
Associate Administrator for Financial Assistance if that person makes a 
determination that it is in the best interest of the small business 
community to allow such intermediary to operate in more than one state.

EFFECTIVE DATE: This rule is effective August 17, 1995.

FOR FURTHER INFORMATION CONTACT: John R. Cox, 202/205-6490.

SUPPLEMENTARY INFORMATION: Section 7(m) of the Act authorizes the SBA 
to operate the Program in which the SBA lends funds to authorized 
intermediaries which re-lend amounts up through $25,000 to eligible 
small business concerns.
    Section 122.61-11(a) of SBA's regulations (13 CFR 122.61-11(a)) 
provides that ``* * * no intermediary may undertake Program activities 
in more than one State''. Since section 7(m) of the Act does not 
prohibit a microloan intermediary from conducting its operations in 
more than one state, SBA believes that the regulation is too broad. 
Circumstances may occur when it would be in the best interest of a 
small business community to authorize a microloan intermediary to 
operate across state lines. On May 5, 1995, SBA published in the 
Federal Register (60 FR 22311) a proposed rule to allow the SBA 
Associate Administrator for Financial Assistance to make a 
determination in that regard. No comments were received so the final 
rule is being published as proposed.

Compliance With Executive Orders 12612, 12778 and 12866, the 
Regulatory Flexibility Act, 5 U.S.C. 601, et seq. and the Paperwork 
Reduction Act, 44 U.S.C. Ch. 35

    For purposes of the Regulatory Flexibility Act, 5 U.S.C. 601 et 
seq., SBA certifies that this final rule will not have a significant 
economic impact on a substantial number of small entities.
    SBA certifies that this final rule will not constitute a 
significant regulatory action for the purposes of Executive Order 
12866, since the change is not likely to result in an annual effect on 
the economy of $100 million or more, nor will this final rule impose 
additional reporting or recordkeeping requirements which would be 
subject to the Paperwork Reduction Act, 44 U.S.C. Chapter 35.
    SBA certifies that this final rule would not have federalism 
implications warranting the preparation of a Federalism Assessment in 
accordance with Executive Order 12612.
    For purposes of Executive Order 12778, SBA certifies that this 
final rule is drafted, to the extent practicable, in accordance with 
the standards set forth in section 2 of that Order.

(Catalog of Federal Domestic Assistance Programs, No. 59.012)

List of Subjects in 13 CFR Part 122

    Loan programs--business, Small businesses.

    Accordingly, pursuant to the authority contained in section 5(b)(6) 
of the Small Business Act (15 U.S.C. 634(b)(6)), SBA amends part 122, 
chapter I, title 13, Code of Federal Regulations, as follows:

PART 122--BUSINESS LOANS

    1. The authority citation for part 122 continues to read as 
follows:

    Authority: 15 U.S.C. 634(b)(6), 636(a), 636(m).

    2. Section 122.61-11(a) is amended by revising the last sentence to 
read as follows:


Sec. 122.61-11  Program procedure.

    (a) Participation of intermediary by State. * * * Further, no 
intermediary may undertake Program activities in more than one State 
unless the SBA Associate Administrator for Financial Assistance 
determines in writing that it would be in the best interest of the 
small business community to operate across State lines.
* * * * *
    Dated: July 31, 1995.
Philip Lader,
Administrator.
[FR Doc. 95-20433 Filed 8-16-95; 8:45 am]
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