[Federal Register Volume 60, Number 95 (Wednesday, May 17, 1995)]
[Rules and Regulations]
[Pages 26350-26351]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-12154]



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DEPARTMENT OF AGRICULTURE
Rural Housing and Community Development Service; Rural Business and 
Cooperative Development Service; Rural Utilities Service; Consolidated 
Farm Service Agency

7 CFR Part 1980

RIN 0575-AB84


Business and Industrial Loan Program

AGENCIES: Rural Housing and Community Development Service, Rural 
Business and Cooperative Development Service, Rural Utilities Service, 
and Consolidated Farm Service Agency, USDA.

ACTION: Final rule.

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SUMMARY: The Rural Business and Cooperative Development Service 
(RBCDS), (pursuant to section 234 of the Department of Agriculture 
Reorganization Act of 1994 (Pub. L. 103-354, October 13, 1994) and the 
Secretary's decision to implement such Authority) is the successor to 
the Rural Development Administration (RDA), which is the successor to 
the Farmers Home Administration (FmHA). RBCDS amends the Business and 
Industry Loan Servicing regulations to clarify the procedure for 
categorizing and classifying loans according to payment frequency 
criteria. The intended effect is to clarify procedures for classifying 
and categorizing loan payment history.

EFFECTIVE DATE: May 17, 1995.

FOR FURTHER INFORMATION CONTACT: Kenneth E. Hennings, Senior Loan 
Specialist, Business and Industry Division, RBCDS (formerly RDA), U.S. 
Department of Agriculture, Room 6337, South Agriculture Building, 14th 
Street and Independence Avenue, SW., Washington, DC, 20250-0700, 
Telephone: (202) 690-3809.

SUPPLEMENTARY INFORMATION:

Classification

    This rule has been determined to be not-significant for purposes of 
Executive Order 12866 and therefore has not been reviewed by the Office 
of Management and Budget (OMB).

Programs Affected

    The Catalog of Federal Domestic Assistance program impacted by this 
action is: 10.768, Business and Industrial Loans.

Intergovernmental Review

    The Business and Industrial Loan programs are subject to the 
provisions of Executive Order 12372 which requires intergovernmental 
consultation with State and local officials. RBCDS has conducted 
intergovernmental consultation in the manner delineated in FmHA 
Instruction 1940-J, ``Intergovernmental Review of Farmers Home 
Administration Programs and Activities.''

Civil Justice Reform

    This final rule has been reviewed under Executive Order 12778, 
Civil Justice Reform. (In accordance with this rule:) (1) All state and 
local laws and regulations that are in conflict with this rule will be 
preempted; (2) no retroactive effect will be given to this rule; and 
(3) administrative proceedings in accordance with the regulations of 
the agency at 7 C.F.R. 1900-B or those regulations published by the 
Department of Agriculture to implement the provisions of the National 
Appeals Division as mandated by the Department of Agriculture 
Reorganization Act of 1994 must be exhausted before bringing suit in 
court challenging action taken under this rule unless those regulations 
specifically allow bringing suit at an earlier time.

Paperwork Reduction Act

    The information collection requirements contained in this 
regulation have been approved by the Office of Management and Budget 
(OMB) under the provisions of 44 U.S.C. Chapter 35 and have been 
assigned OMB control number 0575-0029 in accordance with the Paperwork 
Reduction Act of 1980. This rule does not revise or impose any new 
information collection or recordkeeping requirement from those approved 
by OMB.
Environmental Impact Statement

    This document has been reviewed in accordance with 7 CFR Part 1940, 
subpart G, ``Environmental Program.'' RBCDS has determined that this 
action does not constitute a major Federal action significantly 
affecting the quality of the human environment, and in accordance with 
the National Environmental Policy Act of 1969, Public Law 91-190, an 
Environmental Impact Statement is not required.

Background

    The regulations for Business and Industrial guaranteed loans 
require the lender to classify each loan in accordance with specific 
criteria set out in the regulations. It has been discovered that loans 
that are in compliance with requirements and have been current for more 
than 23 months but still have an outstanding balance of more than two-
thirds of the original loan amount do not fit the criteria provided for 
in any classification. This action is to revise the criteria so that 
those loans will be included in the current non-problem classification.

Comments

    On June 24, 1994, FmHA published a proposed rule with a comment 
period ending on August 23, 1994 in the Federal Register (59 FR 32660) 
to revise the loan classification criteria so that those loans that 
have been current for more than 23 months but still have an outstanding 
balance of more than two-thirds of the original loan amount will be 
included in the current non-problem classification. There were no 
comments on the proposed rule.

List of Subjects in 7 CFR Part 1980

    Loan programs--Business and industry, Rural development assistance, 
Rural areas.

    Accordingly, part 1980 of chapter XVIII, title 7 of the Code of 
Federal Regulations is amended as follows:

PART 1980--GENERAL

    1. The authority citation for part 1980 continues to read as 
follows:

    Authority: 7 U.S.C. 1989; 42 U.S.C. 1480; 7 U.S.C. 301; 7 CFR 
2.23; 7 CFR 2.70.

Subpart E--Business and Industrial Loan Program

    2. Section 1980.469 is amended by revising paragraph (c)(3) to read 
as follows:


Sec. 1980.469  Loan servicing.

* * * * *
    (c) * * * [[Page 26351]] 
    (3) Current Non-problem Classification--Those loans that are 
current and are in compliance with all loan conditions and B&I 
regulations but do not meet all the criteria for a Seasoned Loan 
classification. All loans not classified as Seasoned or Current Non-
problem will be reported on the quarterly status report with 
documentation of the details of the reason(s) for the assigned 
classification.
* * * * *
    Dated: March 28, 1995.
Michael V. Dunn,
Acting Under Secretary, Rural Economic and Community Development.
[FR Doc. 95-12154 Filed 5-16-95; 8:45 am]
BILLING CODE 3410-32-U