27248 Federal Register / Vol. 74, No. 109 / Tuesday, June 9, 2009 / Rules and Regulations 

a portion of the principal during the life 

of the loan without penalty. 

(f) Number of ARC Loans per small 

business. No small business may obtain 

more than one ARC Loan, but the 

proceeds of the ARC loan may be used 

to pay more than one Qualifying Small 

Business Loan. 

(g) Personal guarantees. Holders of at 

least a 20 percent ownership interest in 

the borrower generally must guarantee 

the ARC Loan. 

(h) Collateral. SBA requires each 

lender to follow the collateral policies 

and procedures that it has established 

and implemented for similarly-sized 

non-SBA guaranteed commercial loans. 

The lender’s collateral policies must be 

commercially reasonable and prudent. 

Lenders will certify that the collateral 

policies applied to the ARC Loan meet 

this standard. Lenders may charge 

borrowers the direct cost of securing 

and liquidating collateral for ARC 

Loans. SBA will reimburse Lenders for 

the direct cost of liquidating collateral 

that are not reimbursed by the borrower 

in the event of default. Reimbursement 

of the direct costs of liquidation by SBA 

to the Lender is limited to the amount 

of the recovery received on the ARC 

Loan. 

(i) Credit criteria. To be approved for 

an ARC Loan, the applicant must be a 

creditworthy small business with a 

reasonable expectation of repayment, 

taking into consideration the following: 

(1) Character, reputation, and credit 

history of the applicant (and the 

Operating Company, if applicable) and 

its Associates; 

(2) Experience and depth of 

management; 

(3) Strength of the business; 

(4) Past earnings, current earnings, 

and projected cash flow; and 

(5) Ability to repay the loan with 

earnings from the business. 

(j) Statement of hardship. In addition 

to the certifications required for 7(a) 

loans generally, ARC Loan recipients 

must submit a statement certifying that 

they are experiencing immediate 

financial hardship and provide 

documentation to support the 

certification. 

(k) Loan application. The provisions 

of § 120.191 do not apply for ARC 

Loans. A lender making an ARC Loan 

will provide an application with 

information on the small business that 

includes the nature and history of the 

business, current and historical 

financial statements (or tax returns), and 

other information that SBA may require. 

(l) Preferences and refinancing. A 

lender may make an ARC Loan to an 

Eligible Borrower that intends to use the 

proceeds of the ARC Loan to make 

periodic payments of principal and 

interest on a Qualifying Small Business 

Loan that is owned or serviced by that 

same lender. The provisions of 

§§ 120.10, 120.536(a)(2) and 120.925 

with regard to Preference for 

repayments without prior SBA approval 

do not apply to ARC Loans. The 

provisions of § 120.201 restricting 

refinancing also do not apply to ARC 

Loans. 

(m) Loan fees. Neither the lender nor 

SBA shall impose any fees or direct 

costs on a borrower of an ARC Loan, 

except that lenders may charge 

borrowers for the direct costs of 

securing and liquidating collateral for 

the ARC Loan. Fees include, but are not 

limited to, points, bonus points, 

prepayment penalties, brokerage fees, 

fees for processing, origination, or 

application, and out of pocket expenses 

(other than the direct costs of securing 

and liquidating collateral). SBA will not 

impose any fees on a lender making an 

ARC Loan. 

(n) Lender reporting. Lenders shall 

report on its ARC Loans in accordance 

with requirements established by SBA 

from time to time for 7a loans and loans 

made under the American Recovery and 

Reinvestment Act of 2009. 

(o) Loan servicing. Each originating 

lender shall service all of its ARC Loans 

in accordance with the existing 

practices and procedures that the 

Lender uses for its non-SBA guaranteed 

commercial loans. In all circumstances, 

such practices and procedures must be 

commercially reasonable and consistent 

with prudent lending standards and in 

accordance with SBA Loan Program 

Requirements as defined in § 120.10. 

SBA’s prior written consent is required 

for servicing actions that may have 

significant exposure implications for 

SBA. SBA may require written notice of 

other servicing actions it considers 

necessary for portfolio management 

purposes. 

(p) Liquidations. Each Lender shall be 

responsible for liquidating any 

defaulted ARC Loan originated by the 

Lender. ARC Loans will be liquidated in 

accordance with the existing practices 

and procedures that the Lender uses for 

its non-SBA guaranteed commercial 

loans. In all circumstances, such 

practices and procedures must be 

commercially reasonable and consistent 

with prudent lending standards and in 

accordance with SBA Loan Program 

Requirements as defined in Section 

120.10. Loans with de minimis value 

may, at the Lender’s request and with 

SBA’s approval, be liquidated by SBA or 

its agent(s). Significant liquidation 

actions taken on ARC Loans must be 

documented. The reimbursement of 

liquidation related fees by SBA to the 

Lender is limited to the amount of the 

recovery on the ARC Loan. 

(q) Purchase requests. Any purchase 

request to SBA to honor its guaranty on 

a defaulted ARC Loan shall be made by 

the originating lender. Lenders may 

request SBA to purchase an ARC Loan 

when there has been an uncured 

payment default exceeding 60 days or 

when the borrower has declared 

bankruptcy. SBA requires Lenders to 

submit loans for purchase no later than 

120 days after the earliest uncured 

payment default on the ARC Loan. 

Additionally, SBA may honor its 

guarantee and require a Lender to 

submit an ARC Loan for purchase at any 

time. Except as noted above, the Lender 

is required to complete all recovery 

actions on the ARC Loan after purchase. 

(r) Prohibition on secondary market 

sales and loan participations. A lender 

may not sell an ARC loan into the 

secondary market nor may a lender 

participate a portion of an ARC loan 

with another lender. 

(s) Loan volume. SBA reserves the 

right to allocate loan volume under the 

ARC Loan Program among Lenders (as 

defined in § 120.10). 

(t) Delegated authority. SBA may 

allow lenders to use their delegated 

authority to process ARC Loans. 

(u) Personal resources test. The 

personal resources test provisions of 

§ 120.102 do not apply to ARC Loans. 

(v) Statutory loan limit. The 

provisions of § 120.151 do not apply to 

ARC Loans. 

Karen G. Mills, 

Administrator. 

[FR Doc. E9–13480 Filed 6–8–09; 8:45 am] 

BILLING CODE 8025–01–P 

CONSUMER PRODUCT SAFETY 

COMMISSION 

16 CFR Part 1500 

Labeling Amendment of Blasting Caps 

AGENCY: Consumer Product Safety 

Commission. 

ACTION: Final rule. 

SUMMARY: The Consumer Product Safety 

Commission (Commission or CPSC) is 

issuing a final rule to supplement the 

current definition of ‘‘blasting cap’’ in 

its regulations under the Federal 

Hazardous Substances Act. The final 

rule simply uses the term ‘‘detonator’’ in 

addition to the term ‘‘blasting cap’’ to 

reflect the current usage of those terms 

in the explosives industry. 

DATES: The final rule becomes effective 

June 9, 2009. 

Federal Register / Vol. 74, No. 109 / Tuesday, June 9, 2009 / Rules and Regulations 27249 

FOR FURTHER INFORMATION CONTACT: 

Hyun Sun Kim, Office of the General 

Counsel, Consumer Product Safety 

Commission, 4330 East West Highway, 

Bethesda, MD 20814; telephone (301) 

504–7632, e-mail hkim@cpsc.gov. 

SUPPLEMENTARY INFORMATION: 

A. Background 

The regulations promulgated under 

the Federal Hazardous Substances Act 

(FHSA), 15 U.S.C. 1261–1276, require 

cautionary labeling of hazardous 

substances. 16 CFR part 1500. Under 16 

CFR 1500.83(a)(35), individual blasting 

caps are exempt from bearing the 

statement, ‘‘Keep out of the reach of 

children,’’ or its practical equivalent, if: 

(i) Each cap bears conspicuously in the 

largest type size practicable the 

statement, ‘‘DANGEROUS—BLASTING 

CAPS—EXPLOSIVE’’ and; (ii) the outer 

carton and any accompanying printed 

matter bear appropriate, complete 

cautionary labeling. 

On October 16, 2006, the Institute of 

Makers of Explosives (IME) petitioned 

the Commission to amend the 

regulations at 16 CFR 1500.83(a)(35), to 

allow the use of the term ‘‘detonator’’ to 

be used interchangeably with the term 

‘‘blasting cap.’’ The petition was 

docketed as HP 07–1 and, on December 

12, 2006, the Commission published a 

notice in the Federal Register (71 FR 

74488) stating that it had received the 

petition and inviting public comment 

on the petition. No comments were 

received. 

IME specifically requested adding the 

term ‘‘detonator’’ to the regulation as 

follows (added text is underlined): 

Individual detonators or blasting caps are 

exempt from bearing the statement, ‘‘Keep 

out of the reach of children,’’ or its practical 

equivalent, if: 

(i) Each detonator or cap bears 

conspicuously in the largest type size 

practicable the statement, ‘‘DANGEROUS— 

BLASTING CAPS—EXPLOSIVE’’ or 

‘‘DANGEROUS—DETONATOR—

EXPLOSIVE’’; 

According to IME, the terms 

‘‘detonator’’ and ‘‘blasting cap’’ 

generally are synonymous in the 

explosives community. IME asserts that 

the term ‘‘detonator’’ may be interpreted 

as being more inclusive and is more 

commonly used than the term ‘‘blasting 

cap.’’ To minimize the possibility that 

an individual may not take 

recommended precautions when 

handling initiating devices, IME states 

that it has encouraged the use of the 

term ‘‘detonator’’ instead of the term 

‘‘blasting cap’’ whenever possible. IME 

states that there is no practical benefit 

to requiring the use of both the term 

‘‘detonator’’ and ‘‘blasting cap’’ on 

printed warnings given the limited 

space available on small detonators. 

IME does not advocate replacing the 

term ‘‘blasting cap’’ with ‘‘detonator’’ at 

this time. 

The Commission believes that the 

technical amendment will convey 

useful information concerning the scope 

of the labeling requirements for these 

devises. Because the term ‘‘detonator’’ is 

used widely, including ‘‘detonator’’ in 

16 CFR 1500.83(a)(35) will clarify that 

either a blasting cap or a detonator must 

bear conspicuously in the largest type 

size practicable the statement, 

‘‘DANGEROUS—BLASTING CAPS—- 

EXPLOSIVE’’ or ‘‘DANGEROUS— 

DETONATOR—EXPLOSIVE’’ as 

applicable. The inclusion of the term 

detonator also will increase safety 

awareness by warning individuals to 

take precautions when handling these 

types of devices whether they are 

referred to as blasting caps or 

detonators. Because this amendment is 

technical in nature rather than 

substantive, notice and comment are not 

necessary. See 5 U.S.C. 553(b)(3)(B). 

Moreover, the amendment does not 

change the substantive obligations of 

manufacturers of these devises. 

Accordingly, there is no need to delay 

the effective date. Id. 553 (d)(3). 

List of Subjects in 16 CFR Part 1500 

Consumer protection, Hazardous 

materials, Hazardous substances, 

Imports, Infants and children, Labeling, 

Law enforcement, Toys. 

Conclusion 

■ For the reasons discussed the 

Commission amends 16 CFR 1500.83 to 

read as follows: 

PART 1500—[AMENDED] 

■ 1. The authority citation for part 1500 

continues to read as follows: 

Authority: 15 U.S.C. 1261–1277. 

■ 2. Revise paragraphs 

(a)(35)introductory text and (a)(35)(i) of 

§ 1500.83 to read as follows: 

§ 1500.83 Exemptions for small packages, 

minor hazards, and special circumstances. 

(a) * * * 

(35) Individual detonators or blasting 

caps are exempt from bearing the 

statement, ‘‘Keep out of the reach of 

children,’’ or its practical equivalent, if: 

(i) Each detonator or cap bears 

conspicuously in the largest type size 

practicable the statement, 

‘‘DANGEROUS—BLASTING CAPS— 

EXPLOSIVE’’ or ‘‘DANGEROUS— 

DETONATOR—EXPLOSIVE’’; and 

* * * * * 

Dated: June 3, 2009. 

Todd A. Stevenson, 

Secretary, Consumer Product Safety 

Commission. 

[FR Doc. E9–13365 Filed 6–8–09; 8:45 am] 

BILLING CODE 6355–01–P 

DEPARTMENT OF HOMELAND 

SECURITY 

Coast Guard 

33 CFR Part 117 

[USCG–2009–0286] 

Drawbridge Operation Regulations; 

New Haven Harbor, Quinnipiac and Mill 

Rivers, CT, Test Schedule Change 

AGENCY: Coast Guard, DHS. 

ACTION: Notice of temporary deviation 

from regulations; request for comments. 

SUMMARY: The Commander, First Coast 

Guard District, has issued a temporary 

deviation from the regulation governing 

the operation of three bridges; the Ferry 

Street Bridge and the Grand Avenue 

Bridge across the Quinnipiac River, and 

the Chapel Street Bridge across the Mill 

River, all at New Haven, Connecticut. 

This deviation will test a change to the 

drawbridge operation schedule to 

determine whether a permanent change 

to the schedule is needed. 

DATES: This deviation is effective from 

May 1, 2009 through October 26, 2009. 

Comments must reach the Coast Guard 

on or before November 15, 2009. 

ADDRESSES: You may submit comments 

identified by docket number USCG– 

2009–0286 using any one of the 

following methods: 

(1) Federal eRulemaking Portal: 

http://www.regulations.gov. 

(2) Fax: (202) 493–2251. 

(3) Mail: Docket Management Facility 

(M–30), U.S. Department of 

Transportation, West Building ground 

floor, Room W12–140, 1200 New Jersey 

Avenue, SE., Washington, DC 20590– 

0001. 

(4) Hand Delivery: Same as mail 

address above, between 9 a.m. and 5 

p.m., Monday through Friday, except 

Federal holidays. The telephone number 

is 202–366–9329. 

FOR FURTHER INFORMATION CONTACT: If 

you have questions on this proposed 

rule, call Ms. Judy Leung-Yee, Project 

Officer, First Coast Guard District, 

telephone 212–668–7165. If you have 

questions on viewing or submitting 

material to the docket, call Renee V. 

Wright, Program Manager, Docket 

Operations, telephone 202–366–9826. 

SUPPLEMENTARY INFORMATION: