[Federal Register Volume 82, Number 83 (Tuesday, May 2, 2017)]
[Notices]
[Page 20457]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-08790]


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DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service


Guarantee Fee Rates for Guaranteed Loans for Fiscal Year 2017; 
Maximum Portion of Guarantee Authority Available for Fiscal Year 2017; 
Annual Renewal Fee for Fiscal Year 2017

AGENCY: Rural Business-Cooperative Service, USDA.

ACTION: Notice.

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SUMMARY: This notice helps to improve applicants' awareness of the 
Guarantee Fee rates for Guaranteed Loans for Fiscal Year (FY) 2017, 
Maximum Portion of Guarantee Authority Available for FY 2017, Annual 
Renewal Fee for FY 2017 when applying for guaranteed loans under the 
Business and Industry (B&I) Guaranteed Loan Program.
    The Agency has the authority to charge a guarantee fee and an 
annual renewal fee for loans made under the B&I Guaranteed Loan 
Program. Pursuant to that authority, and subject to the current 
Continuing Resolution, the Agency is establishing an initial guarantee 
fee rate of 3 percent and an annual renewal fee rate of one-half of 1 
percent for the B&I Guaranteed Loan Program.
    The initial guarantee fee is paid at the time the Loan Note 
Guarantee is issued. The annual renewal fee is paid by the lender to 
the Agency once a year. Payment of the annual renewal fee is required 
in order to maintain the enforceability of the guarantee.

DATES: Effective May 2, 2017.

FOR FURTHER INFORMATION CONTACT: Nichelle Daniels, USDA, Rural 
Development, Business Programs, Business and Industry Division, STOP 
3224, 1400 Independence Avenue SW., Washington, DC 20250-3224, 
telephone (202) 720-0786, email [email protected].

SUPPLEMENTARY INFORMATION: As set forth in 7 CFR 4279.120, the Agency 
has the authority to charge an initial guarantee fee and an annual 
renewal fee for loans made under the B&I Guaranteed Loan Program. 
Pursuant to that authority, and subject to the current continuing 
resolution, the Agency is establishing an initial guarantee fee rate of 
3 percent and an annual renewal fee rate of one-half of 1 percent for 
the B&I Guaranteed Loan Program. Unless precluded by a subsequent FY 
2017 appropriation, these rates will apply to all loans obligated in FY 
2017 that are made under the B&I Guaranteed Loan Program. As 
established in 7 CFR 4279.120(b)(1), the amount of the fee on each 
guaranteed loan will be determined by multiplying the fee rate by the 
outstanding principal loan balance as of December 31, multiplied by the 
percentage of guarantee.
    As set forth in 7 CFR 4279.120(a) and 4279.119(b), each fiscal 
year, the Agency shall establish a limit on the maximum portion of B&I 
guarantee authority available for that fiscal year that may be used to 
guarantee loans with a reduced guarantee fee or guaranteed loans with 
an increased percentage of guarantee. The Agency has established that 
not more than 12 percent of the Agency's apportioned B&I guarantee 
authority will be reserved for loan guarantee requests with a reduced 
fee, and not more than 15 percent of the Agency's apportioned B&I 
guarantee authority will be reserved for guaranteed loan requests with 
an increased percentage of guarantee. Once the respective limits are 
reached, all additional loans will be at the standard fee and guarantee 
limits.
    Allowing a reduced guarantee fee or increased percentage of 
guarantee on certain B&I guaranteed loans that meet the conditions set 
forth in 7 CFR 4279.120 and 4279.119 will increase the Agency's ability 
to focus guarantee assistance on projects that the Agency has found 
particularly meritorious. Subject to annual limits set by the Agency in 
this notice, the Agency may charge a reduced guarantee fee if requested 
by the lender for loans of $5 million or less when the borrower's 
business supports value-added agriculture and results in farmers 
benefitting financially, promotes access to healthy foods, or is a high 
impact business development investment located in a rural community 
that is experiencing long-term population decline; has remained in 
poverty for the last 30 years; is experiencing trauma as a result of 
natural disaster; is located in a city or county with an unemployment 
rate 125 percent of the statewide rate or greater; or is located within 
the boundaries of a federally recognized Indian tribe's reservation or 
within tribal trust lands or within land owned by an Alaska Native 
Regional or Village Corporation as defined by the Alaska Native Claims 
Settlement Act. Subject to annual limits set by the Agency in this 
notice, the Agency may allow increased percentages of guarantee for 
high-priority projects or loans where the lender needs the increased 
percentage of guarantee due to its legal or regulatory lending limit.
    This action has been reviewed and determined not to be a rule or 
regulation as defined in Executive Order 12866, as amended by Executive 
Order 13258.

    Dated: April 18, 2017.
Chadwick O. Parker,
Acting Administrator, Rural Business-Cooperative Service.
[FR Doc. 2017-08790 Filed 5-1-17; 8:45 am]
BILLING CODE 3410-XY-P