[Federal Register Volume 73, Number 66 (Friday, April 4, 2008)]
[Notices]
[Page 18600]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-7067]


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SMALL BUSINESS ADMINISTRATION


Liquidation and Debt Collection Activities; Fees for Liquidation 
Activities Performed by Authorized CDC Liquidators

AGENCY: U.S. Small Business Administration (SBA).

ACTION: Notice of Compensation Fees Percentages.

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SUMMARY: SBA is setting the compensation fees for Authorized CDC 
Liquidators (``ACLs'') for their liquidation activities on 504 loans 
that have been completed as of the date of this notice, and for ongoing 
liquidation activities being pursued according to an approved 
liquidation plan, at 10% of the net recovery proceeds realized from the 
sale of collateral or other liquidation actions on an individual loan 
up to $25,000 for each such loan and 5% of the realized net recovery 
proceeds above such amounts. SBA is also setting compensation fees for 
liquidations by ACLs of 504 loans where the debenture was purchased 
during the period after May 14, 2007, through the date of this notice, 
and for which a liquidation plan has not yet been approved by SBA, at 
4% of the net recovery proceeds realized from the sale of collateral or 
other liquidation action on an individual loan up to $25,000 for each 
such loan and 2% of the realized net recovery proceeds above such 
amounts.

DATES: These compensation fee percentages are effective as of April 4, 
2008.

FOR FURTHER INFORMATION CONTACT: Walter Intlekofer, Chief, Portfolio 
Management Division, (202) 205-7543, [email protected].

SUPPLEMENTARY INFORMATION:
On April 12, 2007, SBA published in the Federal Register at 72 FR 
18349, a final rule amending the regulations pertaining to guaranteed 
loan and debenture liquidation and litigation cases for the Certified 
Development Company Program and the 7(a) Guaranteed Loan Program. This 
final rule had an effective date of May 14, 2007. In Section 120.542(c) 
of the amended regulations, SBA published the formula for determining 
the compensation fee that SBA would pay to Authorized CDC Liquidators 
for their liquidation actions on 504 loans. SBA stated that the 
compensation fee was to be a percentage (to be published in the Federal 
Register from time to time, but not to exceed 10%) of the net recovery 
proceeds realized from the sale of collateral or other liquidation 
activities, on an individual loan, up to a fee of $25,000 for such 
loan, and a lower percentage (also to be published in the Federal 
Register from time to time, but not to exceed 5%) of the realized net 
recovery proceeds above such amounts.
    SBA recognizes that some ACLs have been performing liquidation 
activities on certain 504 loans since the publication of the final 
rule. Therefore, SBA will provide compensation from its administrative 
budget and on an interim basis, is setting the liquidation compensation 
percentages as follows:
    For all liquidations of 504 loans that have been completed by an 
ACL as of the date of this notice, where the liquidation plan was 
approved by SBA after the date the CDC became an ACL, SBA will pay a 
compensation fee of 10% of the net recovery proceeds realized from the 
sale of collateral or other liquidation actions on an individual loan 
up to $25,000 for each such loan and 5% of the realized net recovery 
proceeds above such amounts.
    For all liquidations currently in progress that are being pursued 
by an ACL in accordance with an SBA approved liquidation plan that was 
approved after the date the CDC became an ACL, SBA will pay a 
compensation fee of 10% of the net recovery proceeds realized from the 
sale of collateral or other liquidation actions on an individual loan 
up to $25,000 for each such loan and 5% of the realized net recovery 
proceeds above such amounts.
    For all liquidations by an ACL on 504 loans for which the 
debentures were purchased after May 14, 2007 (the effective date of the 
final rule), through the date of this notice, and for which a 
liquidation plan has not yet been approved, SBA will pay a compensation 
fee of 4% of the net recovery proceeds realized from the sale of 
collateral or other liquidation actions on an individual loan up to 
$25,000 for each such loan and 2% of the realized net recovery proceeds 
above such amounts. Liquidation plans for these loans must be submitted 
to SBA Commercial Loan Centers in Fresno, CA or Little Rock, AK within 
90 calendar days from the date of this notice.
    For any 504 loan for which the debenture has not yet been 
purchased, SBA is unable to pay any compensation fees at this time. Any 
future change will be communicated in the Federal Register.
    Pursuant to 13 CFR 120.542(c), all requests for compensation fees 
must be received by SBA within nine months from the date of SBA's 
purchase of the defaulted debenture. Fee requests not received within 
such timeframe will be automatically rejected.

    Authority: 13 CFR 120.542.

Grady Hedgespeth,
Director of Financial Assistance.
 [FR Doc. E8-7067 Filed 4-3-08; 8:45 am]
BILLING CODE 8025-01-P