[Federal Register Volume 64, Number 142 (Monday, July 26, 1999)]
[Rules and Regulations]
[Pages 40282-40283]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-18951]


=======================================================================
-----------------------------------------------------------------------

SMALL BUSINESS ADMINISTRATION

13 CFR Part 114


Administrative Claims Under the Tort Claims Act and 
Representations and Indemnification of SBA Employees

AGENCY: Small Business Administration.

ACTION: Final rule.

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

SUMMARY: With this rule, SBA revises a portion of its regulations 
governing Administrative Claims under the Tort Claims Act. Previously, 
a claim had to be presented to the SBA District Counsel for the SBA 
District Office in the same State as the claim. The SBA District 
Counsel had the authority to deny a tort claim of $5,000 or less or to 
recommend any other action to the SBA General Counsel. This final rule 
provides the same authority to Disaster Area Counsel when the claim is 
based on the acts or omissions of employees of SBA's Disaster 
Assistance Program. It also vests authority to approve or deny a tort 
claim of $25,000 or less with SBA's Associate General Counsel for 
Litigation, rather than the General Counsel.

DATES: This rule is effective July 26, 1999.

FOR FURTHER INFORMATION CONTACT: Timothy C. Treanor, Chief Counsel to 
the Disaster Assistance Program, Office of General Counsel, at (202) 
205-6885.

SUPPLEMENTARY INFORMATION: SBA promulgates, without change, a rule 
which it proposed on April 29, 1999 (64 FR 23027). SBA received no 
comments to the proposed rule.
    Under the Disaster Assistance Program, SBA makes direct loans to 
individual and business victims of natural disasters. SBA makes these 
loans through an organizational structure that is separate and distinct 
from other SBA lending programs. The Disaster Assistance Program 
operates from four permanent Area Offices and from temporary local 
offices that are from time to time established to handle such 
disasters. SBA's Disaster Area Office employees and local office 
employees are located in different offices from other SBA employees and 
report to different managers.
    Under the previous regulation, SBA's District Counsels who are not 
located in disaster offices had exclusive authority to investigate any 
claim arising within the jurisdiction covered by their Districts, 
including claims based on acts or omissions of Disaster Assistance 
employees. District Counsels also had the authority to deny or 
recommend approval of a claim for $5,000 or less. Under the previous 
regulation, District Counsels investigated claims exceeding $5,000 but 
less than $25,000 and forwarded them with a recommendation to SBA's 
General Counsel.
    Under the new regulation, a claimant may file a tort claim against 
SBA for the acts or omissions of an employee of SBA's Disaster 
Assistance Program either at the State's District Office (the one 
closest to the site of the injury if there is more than one District 
Office) or at the nearest Disaster Area Office. The new regulation 
provides authority identical to that of the District Counsel to the 
Disaster Area Counsel to investigate and make recommendations 
concerning claims arising from a Disaster Assistance employee's acts or 
omissions. It also vests the Associate

[[Page 40283]]

General Counsel for Litigation with the authority to decide claims of 
$25,000 or less, which is in line with the Agency's current practice.
    The new regulation also removes inaccurate language from 
Sec. 114.105 concerning the requirement that District Counsel consult 
with the General Counsel before approving claims for less than $5,000 
(the District Counsel does not have the authority to approve such 
claims).
    The new regulation also removes unnecessary language from 
Secs. 114.106 and 114.108 which purport to characterize Sec. 114.107, 
and makes other, minor, technical changes.

Compliance With Executive Orders 12612, 12988, and 12866, the 
Regulatory Flexibility Act (5 U.S.C. 601-612), and the Paperwork 
Reduction Act (44 U.S.C. Ch. 35)

    SBA certifies that this rule does not have a significant economic 
impact on a substantial number of small entities within the meaning of 
Executive Order 12866 or the Regulatory Flexibility Act, 5 U.S.C. 601-
612. It merely changes SBA's internal procedures and serves to make 
tort claim resolution more accessible to the general public. It will 
not have an annual economic effect of $100 million or more, result in a 
major increase in costs or prices, or have a significant adverse effect 
on competition or the United States economy.
    For purposes of the Paperwork Reduction Act, 44 U.S.C. Ch. 35, SBA 
certifies that this rule contains no new reporting or recordkeeping 
requirements.
    For purposes of Executive Order 12612, SBA certifies that this rule 
has no federalism implications warranting the preparation of a 
federalism assessment.
    For purposes of Executive Order 12988, SBA certifies that this rule 
is drafted, to the extent practicable, in accordance with the standards 
set forth in Section 3 of that Order.

List of Subjects in 13 CFR Part 114

    Tort claims.

    For the reasons stated in the preamble, the SBA amends 13 CFR part 
114 as follows:

PART 114--ADMINISTRATIVE CLAIMS UNDER THE FEDERAL TORT CLAIMS ACT 
AND REPRESENTATION AND INDEMNIFICATION OF SBA EMPLOYEES

Subpart A--Administrative Tort Claims

    1. The authority citation for part 114 continues to read as 
follows:

    Authority: 15 U.S.C. 634 (b)(1), (b)(6); 28 U.S.C. 2672; 28 CFR 
14.11.

    2. Revise Sec. 114.102 to read as follows:


Sec. 114.102  When, where and how do I present a claim?

    (a) When. You must present your claim within 2 years of the date of 
accrual.
    (b) Where. You may present your claim at the SBA District Office 
nearest to the site of the action giving rise to the claim and within 
the same state as the site. If your claim is based on the acts or 
omissions of an employee of SBA's Disaster Assistance Program, you may 
present your claim either to the appropriate SBA District Office or to 
the Disaster Assistance Office nearest to the site of the action giving 
rise to the claim.
    (c) How. You must use an official form which can be obtained from 
the SBA office where you file the claim or give other written notice of 
your claim, stating the specific amount of your alleged damages and 
providing enough information to enable SBA to investigate your claim. 
You may present your claim in person or by mail, but your claim will 
not be considered presented until SBA receives the written information.
    3. In Sec. 114.105, revise paragraphs (b) and (c) to read as 
follows:


Sec. 114.105  Who investigates and considers my claim?

    * * * * *
    (b) In those cases in which SBA investigates your claim, and which 
arise out of the acts or omissions of employees other than employees of 
the Disaster Assistance Program, the SBA District Counsel in the office 
with jurisdiction over the site where the action giving rise to the 
claim occurred will investigate and make recommendations or 
determination with respect to your claim. In those cases in which SBA 
investigates your claim, and which arise out of acts or omissions of 
Disaster Assistance Program employees, the SBA Disaster Area Counsel in 
the office with jurisdiction over the site where the action giving rise 
to the claim occurred will investigate and make recommendations or a 
determination with respect to your claim. The District Counsel, or 
Disaster Area Counsel, where appropriate, may negotiate with you, and 
is authorized to use alternative dispute resolution mechanisms, which 
are nonbinding on SBA, when they may promote the prompt, fair and 
efficient resolution of your claim.
    (c) If your claim is for $5,000 or less, the District Counsel or 
Disaster Area Counsel who investigates your claim may deny the claim, 
or may recommend approval, compromise, or settlement of the claim to 
the Associate General Counsel for Litigation, who will in such a case 
take final action.
    4. Revise Sec. 114.106 to read as follows:


Sec. 114.106  What if my claim exceeds $5,000?

    The District Counsel or Disaster Area Counsel, as appropriate, must 
review and investigate your claim and forward it with a report and 
recommendation to the Associate General Counsel for Litigation, who may 
approve or deny an award, compromise, or settlement of claims in excess 
of $5,000, but not exceeding $25,000.
    5. Revise Sec. 114.108 to read as follows:


Sec. 114.108  What if my claim is approved?

    SBA will notify you in writing if it approves your claim. The 
District Counsel or Disaster Area Counsel investigating your claim will 
forward to you, your agent or legal representative the forms necessary 
to indicate satisfaction of your claim and your acceptance of the 
payment. Acceptance by you, your agent or your legal representative of 
any award, compromise or settlement releases all your claims against 
the United States under the Federal Tort Claims Act. This means that it 
binds you, your agent or your legal representative, and any other 
person on whose behalf or for whose benefit the claim was presented. It 
also constitutes a complete release of your claim against the United 
States and its employees. If you are represented by counsel, SBA will 
designate you and your counsel as joint payees and will deliver the 
check to counsel. Payment is contingent upon the waiver of your claim 
and is subject to the availability of appropriated funds.

    Dated: July 20, 1999.
Aida Alvarez,
Administrator.
[FR Doc. 99-18951 Filed 7-23-99; 8:45 am]
BILLING CODE 8025-01-P