[Federal Register Volume 70, Number 209 (Monday, October 31, 2005)]
[Notices]
[Page 62294]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-21588]


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DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service


Guarantee Fee Rates for Guaranteed Loans for Fiscal Year 2006; 
Maximum Portion of Guarantee Authority Available for Fiscal Year 2006

AGENCY: Rural Business-Cooperative Service, USDA.

ACTION: Notice.

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SUMMARY: As set forth in 7 CFR 4279.107(b) and 4280.126(c), Rural 
Development (the Agency) has the authority to charge an annual renewal 
fee for loans made under the Business and Industry (B&I) Guaranteed 
Loan Program and the Renewable Energy and Energy Efficiency 
Improvements (REEEI) Guaranteed Loan Program. Pursuant to that 
authority, the Agency is establishing the renewal fee rate at one-
fourth of 1 percent for the B&I Guaranteed Loan Program and one-eighth 
of 1 percent for the REEEI Guaranteed Loan Program. These rates will 
apply to all loans obligated in fiscal year (FY) 2006 that are made 
under the cited programs. As established in 7 CFR 4279.107 and 
4280.126, 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 percent of guarantee.
    As set forth in 7 CFR 4280.126(a), each fiscal year the Agency 
shall establish the initial guarantee fee rate for loans made under the 
REEEI Guaranteed Loan Program. Pursuant to that authority, the Agency 
is establishing the initial guarantee fee rate at 1 percent for loans 
made in FY 2006.
    As set forth in 7 CFR 4279.107(a) and 4279.119(b)(4), 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 B&I guarantee fee of 1 percent or guaranteed 
loans with a guarantee percentage exceeding 80 percent.
    Allowing the guarantee fee to be reduced to 1 percent or exceeding 
the 80 percent guarantee on certain B&I guaranteed loans that meet the 
conditions set forth in 7 CFR 4279.107 and 4279.119 will increase the 
Agency's ability to focus guarantee assistance on projects which the 
Agency has found particularly meritorious, such as projects in rural 
communities that remain persistently poor, which experience long-term 
population decline and job deterioration, are experiencing trauma as a 
result of natural disaster, or are high impact as defined in 7 CFR 
4279.155(b)(5).
    Not more than 12 percent of the Agency's quarterly apportioned B&I 
guarantee authority will be reserved for loan requests with a guarantee 
fee of 1 percent, and not more than 15 percent of the Agency's 
quarterly apportioned guarantee authority will be reserved for 
guaranteed loan requests with a guaranteed percentage exceeding 80 
percent. Once the above quarterly limits have been reached, all 
additional loans guaranteed during the remainder of that quarter will 
require a 2 percent guarantee fee and not exceed an 80 percent 
guarantee limit.
    Written requests by the Rural Development State Office for approval 
of a guaranteed loan with a 1 percent guarantee fee or a guaranteed 
loan exceeding 80 percent must be forwarded to the National Office, 
Attn: Director, Business and Industry Division, for review and 
consideration prior to obligation of the guaranteed loan. The 
Administrator will provide a written response to the State Office 
confirming approval or disapproval of the request.

Effective Date: October 31, 2005.

FOR FURTHER INFORMATION CONTACT: Rick Bonnet, Special Projects/Programs 
Oversight Division, Rural Business-Cooperative Service, USDA, STOP 
3221, 1400 Independence Avenue, SW., Washington, DC 20250-3221, 
telephone (202) 720-1804.

SUPPLEMENTARY INFORMATION: 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: October 21, 2005.
Peter J. Thomas,
Administrator.
[FR Doc. 05-21588 Filed 10-28-05; 8:45 am]
BILLING CODE 3410-XY-P