[Federal Register Volume 75, Number 34 (Monday, February 22, 2010)]
[Rules and Regulations]
[Pages 7545-7546]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-3395]



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  Federal Register / Vol. 75, No. 34 / Monday, February 22, 2010 / 
Rules and Regulations  

[[Page 7545]]



SMALL BUSINESS ADMINISTRATION

13 CFR Part 123

RIN 3245-AF97


Disaster Home Loans: FEMA Interaction

AGENCY: U.S. Small Business Administration.

ACTION: Direct final rule.

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SUMMARY: SBA is amending its disaster assistance regulations to reflect 
changes to the Small Business Act (Act) made by the Food, Conservation, 
and Energy Act of 2008, which require SBA to promulgate regulations in 
consultation with the Administrator of the Federal Emergency Management 
Agency (FEMA) to ensure that each application for disaster assistance 
is processed by SBA or another appropriate agency in a prompt manner. 
This direct final rule clarifies SBA's process of timely coordination 
with FEMA and other agencies for delivering Federal disaster assistance 
to homeowners and renters who have sustained property damage as a 
result of a disaster declared by the President.

DATES: Effective Date: This rule is effective April 8, 2010 without 
further action, unless significant adverse comment is received on or 
before March 24, 2010. If significant adverse comment is received, SBA 
will publish a timely withdrawal of the rule in the Federal Register.

ADDRESSES: You may submit comments, identified by RIN 3245-AF97, by any 
of the following methods: (1) Federal Rulemaking Portal: http://www.regulations.gov, following the specific instructions for submitting 
comments; (2) FAX (202) 481-2226; or E-mail: [email protected]; or 
(3) Mail/Hand Delivery/Courier: James E. Rivera, Associate 
Administrator for Disaster Assistance, 409 3rd Street, SW., Washington, 
DC 20416.

FOR FURTHER INFORMATION CONTACT: Roger B. Garland, Office of Disaster 
Assistance, 202-205-6734 or [email protected].

SUPPLEMENTARY INFORMATION: SBA makes disaster assistance loans to 
homeowners, renters, and businesses adversely affected by a disaster 
event. SBA works closely with FEMA and other Federal, State, and local 
agencies in the delivery of disaster assistance to victims. Under a 
Presidential disaster declaration, FEMA serves as the coordinating 
agency for all Federal agencies providing disaster assistance, 
including SBA. Most disaster victims register through FEMA for Federal 
disaster assistance. Upon registration, FEMA may provide home repair 
grant assistance to homeowners, within certain limits. FEMA then refers 
victims to SBA to be considered for disaster loan assistance for home 
repair and personal property loss. If SBA is unable to approve a loan, 
a homeowner or renter is referred by SBA to FEMA's Federal Assistance 
to Individuals and Households Program (IHP) to be considered for 
further grant assistance. Additionally, if disaster assistance is 
available from State/local or other agencies (e.g., American Red 
Cross), SBA may refer the disaster victim to the appropriate agency.
    The Food, Conservation, and Energy Act of 2008, Public Law 110-246 
(the Farm Act), enacted on June 18, 2008, requires SBA to ensure that 
its disaster assistance programs are coordinated, to the maximum extent 
practicable, with FEMA's disaster assistance programs. This statute 
also requires SBA to establish regulations, in consultation with FEMA, 
to ensure that each application for disaster assistance is submitted as 
quickly as practicable to SBA or directed to the appropriate agency 
under the circumstances. SBA has consulted with FEMA and is publishing 
this direct final rule to codify the process for timely coordination 
with FEMA and other agencies, and to clarify for the public the initial 
phases of obtaining disaster assistance.

Section-by-Section Analysis

    In order to reflect the provisions of the Farm Act, SBA is adding 
new section 123.108 to its regulations to reflect that when the 
President makes a disaster declaration, an applicant for disaster loan 
assistance for homeowners or renters may be eligible for FEMA IHP grant 
assistance. The new section specifies that, after registering with 
FEMA, the applicant may be referred to SBA for home loan assistance. If 
SBA declines the application, or if the damage amount exceeds the 
maximum SBA loan amount, SBA may refer the applicant to FEMA or another 
appropriate agency for possible grant assistance. This new section, 
which describes existing procedures, makes clear that any such referral 
will be made on a timely basis.

Consideration of Comments

    SBA believes that this rule is routine and non-controversial since 
it simply implements the statute, and SBA anticipates no significant 
adverse comments to the rulemaking. If SBA receives any adverse 
comments, it will publish a timely withdrawal of this direct final 
rule.

Compliance With Executive Orders 12866, 12988, 13132 and the Regulatory 
Flexibility Act (5 U.S.C. 601-612), and the Paperwork Reduction Act (44 
U.S.C. Ch. 35)

Executive Order 12866

    The Office of Management and Budget (OMB) has determined that this 
rule does not constitute a significant regulatory action under 
Executive Order 12866.

Executive Order 12988

    This action meets applicable standards set forth in sections 3(a) 
and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize 
litigation, eliminate ambiguity, and reduce burden. The action does not 
have retroactive or preemptive effect.

Executive Order 13132

    The final rule will not have substantial direct effects on the 
States, on the relationship between the national government and the 
States, or the distribution of power and responsibilities among the 
various levels of government, because the rule does not alter the 
current relationship between federal, state, and local disaster 
authorities. Therefore, for the purposes of Executive Order 13132, 
Federalism, SBA determines that this final rule has

[[Page 7546]]

no federalism implications warranting preparation of a federalism 
assessment.

Paperwork Reduction Act

    SBA has determined that this final rule does not impose additional 
reporting or recordkeeping requirements under the Paperwork Reduction 
Act, 44 U.S.C., Chapter 35.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA), 5 U.S.C. 601, requires 
administrative agencies to consider the effect of their actions on 
small entities, including small businesses. Pursuant to the RFA, when 
an agency issues a rule, the agency must prepare an analysis to 
determine whether the impact of the rule will have a significant 
economic impact on a substantial number of small entities. However, the 
RFA requires analysis of a rule only where notice and comment 
rulemaking are required. Rules are exempt from Administrative Procedure 
Act (APA) notice and comment requirements and therefore from the RFA 
requirements when the agency for good cause finds (and incorporates the 
finding and brief statement of reasons in the rules issued) that notice 
and public procedure thereon is impracticable, unnecessary, or contrary 
to the public interest. In this case it would be impracticable given 
the emergency nature of the recent legislation authorizing the new 
requirements.

List of Subjects in 13 CFR Part 123

    Disaster assistance, Reporting and recordkeeping requirements.

0
For the reasons set forth in the preamble, the Small Business 
Administration amends 13 CFR part 123 as follows:

PART 123---DISASTER LOAN PROGRAM

0
1. The authority citation for part 123 continues to read as follows:

    Authority:  15 U.S.C. 634(b)(6), 636(b), 636 (c); 657i, Pub. L. 
102-395, 106 Stat. 1828; Pub. L. 103-75, 107 Stat. 739; Pub. L. 106-
50, 113 Stat. 245; Pub. L. 110-246, 112 Stat. 1651.


0
2. Amend Subpart B by adding at the end new Sec.  123.108 to read as 
follows:


Sec.  123.108  How do the SBA disaster loan program and the FEMA grant 
programs interact?

    After a Presidential disaster declaration is made, you may be 
eligible for disaster assistance, including grant assistance, from the 
Federal Emergency Management Agency's (FEMA) Federal Assistance to 
Individuals and Households Program (IHP). After you register with FEMA 
for disaster assistance, FEMA will consider you for IHP assistance, 
which includes housing assistance grants to repair or replace your 
damaged primary residence and temporary housing assistance (including 
rental assistance) to assist you temporarily with a place to live, and 
assistance with personal property, medical, dental and funeral 
expenses. FEMA may also refer you to SBA to apply for loan assistance 
to help repair or rebuild your home and/or to replace personal property 
destroyed during the disaster. If SBA is unable to approve your loan 
application, or if you have damage in excess of the SBA loan amount, 
SBA may refer you, on a timely basis, to FEMA for IHP grant 
consideration to assist with your unmet personal property and 
transportation needs. If you are approved for the SBA disaster loan and 
you have received grant assistance that duplicates the damage covered 
by the SBA loan, such grant assistance must be deducted from your loan 
eligibility as described in section 123.101(c) of the regulations. All 
grant decisions are made by FEMA. Additionally, if additional disaster 
assistance is available from state, local or other agencies, SBA may 
refer you to the appropriate agency for consideration.

    Dated: February 16, 2010.
Karen G. Mills,
Administrator.
[FR Doc. 2010-3395 Filed 2-19-10; 8:45 am]
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