[Federal Register Volume 85, Number 34 (Thursday, February 20, 2020)]
[Notices]
[Pages 9725-9726]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-03338]


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DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service


Guarantee Fee Rates for Guaranteed Loans for Fiscal Year 2020, 
Maximum Portion of Guarantee Authority Available for Fiscal Year 2020, 
Annual Renewal Fee for Fiscal Year 2020

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) 2020, the 
Maximum Portion of Guarantee Authority Available for FY 2020, and the 
Annual Renewal Fee for FY 2020 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 
appropriated authority, 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: This rule is effective February 20, 2020.

FOR FURTHER INFORMATION CONTACT: Brenda Griffin, USDA, Rural 
Development, Business Programs, Business and Industry Division, STOP 
3224, 1400 Independence Avenue SW, Washington, DC 20250-3224, telephone 
(202) 720-6802, 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 appropriated authority, 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 2020 appropriation, these 
rates will apply to all loans obligated in FY 2020 that are made under 
the B&I Guaranteed Loan Program. As established in 7 CFR 
4279.120(b)(1), the amount of the annual fee on each guaranteed loan 
will be determined by multiplying the annual 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

[[Page 9726]]

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 5 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 5 percent of the Agency's apportioned B&I guarantee 
authority will be reserved for guaranteed loan requests with an 
increased percentage of guarantee. The funds set aside for increased 
percentages of guarantee and reduced guarantee fees, which were set at 
15 percent and 12 percent, respectively pursuant to the 2019 Agency 
notice, now will change to 5 percent for both with this notice. Once 
the respective limits are reached, all additional loans will be at the 
standard fee and guarantee limits. These changes will have the effect 
of reducing the need for USDA to reprogram funds, which can delay when 
funds are made available to borrowers at regular terms and are based on 
past experience in this program. 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.

Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the Office of Information and Regulatory Affairs designated this notice 
as not major, as defined by 5 U.S.C. 804(2).

Non-Discrimination Statement

    In accordance with Federal civil rights law and U.S. Department of 
Agriculture (USDA) civil rights regulations and policies, the USDA, its 
Agencies, offices, and employees, and institutions participating in, or 
administering, USDA programs are prohibited from discriminating based 
on race, color, national origin, religion, sex, gender identity 
(including gender expression), sexual orientation, disability, age, 
marital status, family/parental status, income derived from a public 
assistance program, political beliefs, or reprisal or retaliation for 
prior civil rights activity, in any program or activity conducted or 
funded by USDA (not all bases apply to all programs). Remedies and 
complaint filing deadlines vary by program or incident.
    Persons with disabilities who require alternative means of 
communication for program information (e.g., Braille, large print, 
audiotape, American Sign Language, etc.) should contact the responsible 
Agency or USDA's TARGET Center at (202) 720-2600 (voice and TTY) or 
contact USDA through the Federal Relay Service at (800) 877-8339. 
Additionally, program information may be made available in languages 
other than English.
    To file a program discrimination complaint, complete the USDA 
Program Discrimination Complaint Form, AD-3027, found online at: http://www.ascr.usda.gov/complaint_filing_cust.html and at any USDA office or 
write a letter addressed to USDA and provide in the letter all of the 
information requested in the form. To request a copy of the complaint 
form, call (866) 632-9992. Submit your completed form or letter to USDA 
by:
(1) Mail: U.S. Department of Agriculture, Office of the Assistant 
Secretary for Civil Rights, 1400 Independence Avenue SW, Washington, DC 
20250-9410;
(2) Fax: (202) 690-7442; or
(3) Email: [email protected].
USDA is an equal opportunity provider, employer, and lender.

Mark Brodziski,
Acting Administrator, Rural Business-Cooperative Service.
[FR Doc. 2020-03338 Filed 2-19-20; 8:45 am]
 BILLING CODE 3410-XY-P