Source: https://www.everycrsreport.com/files/20180406_R41184_2655966a6709a6176c98d4c8ba31cae8e84261b1.html
Timestamp: 2020-03-29 11:08:10
Document Index: 403213330

Matched Legal Cases: ['§120', '§120', '§120', '§120', '§120', '§120', '§120', '§120', '§120']

Updated April 6, 2018 (R41184)
Source: U.S. Small Business Administration, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 221, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
The interest rate for 504/CDC debentures is set by the SBA and approved by the Secretary of the Treasury.28 It is based on market conditions for long-term government debt at the time of sale and pegged to an increment above the current market rate for 5-year and 10-year U.S. Treasury issues. The interest rate for 20-year 504/CDC debentures in April 2018 is 4.92%.29 In addition, the SBA sets the maximum interest rate that can be charged by any third-party lender for a commercial loan which funds any portion of the cost of a 504/CDC project. The rate "must be reasonable" and published in the Federal Register. The current maximum interest rate that a third-party lender is allowed to charge for a commercial loan that funds any portion of the cost of a 504/CDC project is 6% greater than the New York prime rate or the maximum interest rate permitted in that state, whichever is less.30
CDCs may apply to the SBA for ALP status. Selection is based on several factors, including the CDC's experience as a CDC, the number of 504/CDC loans approved, the size of the CDC's portfolio, its record of compliance with SBA loan program requirements, and its record of cooperation with all SBA offices.47 The SBA is able to process loan requests from ALP-CDCs more quickly than from regular CDCs because it relies on their credit analysis when making the decision to guarantee the debenture. About one-third of CDCs have ALP status (77 of 226) and they account for about 60% of all 504/CDC lending.48
As of September 30, 2017, 15 CDCs had active PCLP status.52 In recent years, the number and amount of 504/CDC loans made through the PCLP program have declined. In FY2009, 373 PCLP loans amounting to $185.4 million were disbursed. In FY2017, 11 PCLP loans amounting to $10.6 million were disbursed.53
SBA, Office of Congressional and Legislative Affairs, "SBA FY2017 PCLP Annual Report to Congress, April 4, 2018.
The SBA considers the following to be limited or special purpose properties: amusement parks; bowling alleys; car wash properties; cemeteries; clubhouses; cold storage facilities in which more than 50% of total square footage is equipped for refrigeration; dormitories; farms, including dairy facilities; funeral homes with crematoriums; gas stations; golf courses; hospitals, surgery centers, urgent care centers, and other health medical facilities; hotels and motels; marinas; mines; museums; nursing homes, including assisted living facilities; oil wells; quarries, including gravel pits; railroads; sanitary landfills; service centers (e.g., oil and lube, brake, or transmission centers) with pits and in-ground lifts; sports arenas; swimming pools; tennis clubs; theaters; and wineries. SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, pp. 224-225, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
See SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, pp. 252-253, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf. Expansion "includes any project that involves the acquisition, construction or improvement of land, building or equipment for use by the small business applicant." See ibid., p. 253.
SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 251, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
Capital Certified Development Corporation, "504/CDC Program Interest Rates," Austin, TX, at https://www.capitalcdc.com/loan-programs/the-sba-504-program. The interest rate for 20-year 504/CDC debentures was 4.59% in March 2012, 4.01% in January 2013, 4.53% in June 2013, 5.45% in October 2013, 5.29% in April 2014, 4.82% in October 2014, 4.78% in December 2014, 4.55% in February 2015, 4.85% in June 2015, 4.8% in November 2015, 4.87% in January 2016, 4.32% in May 2016, 4.08% in October 2016, 4.59% in December 2016, 4.37% in September 2017, and 4.51% in December 2017.
See SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 260, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
See SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 148, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
See SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, pp. 43-44, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf. The SBA issued a final rule, effective April 21, 2015, that changed the SBA's regulations concerning the CDC's board of directors (13 C.F.R. §120.823). For example, the CDC's board of directors are now required to have at least nine voting directors; at least one voting director who represents the economic, community, or workforce development fields; and at least two voting directors, other than the CDC manager, who represent the commercial lending field. See SBA, "504 and 7(a) Loan Programs Updates," 79 Federal Register 15641, 15644-15646, March 21, 2014.
13 C.F.R. §120.823; and See SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, pp. 45-46, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf. The SBA issued a final rule, effective April 21, 2015, that changed the SBA's regulations concerning the CDC's board of directors and the structure and operations of CDC loan committees (13 C.F.R. §120.823). Under the new rule, loan committees are required to have at least two members (instead of one) with commercial lending experience satisfactory to the SBA. See SBA, "504 and 7(a) Loan Programs Updates," 79 Federal Register 15650, March 21, 2014.
See SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 46, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 64, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 66, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 158, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, pp. 223-224, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 289, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf; and 13 C.F.R. §120.971(a)(1).
SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 292, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf; and 13 C.F.R. §120.883(e).
13 C.F.R. §120.971(a)(3); and SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 292, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
13 C.F.R. §120.971(a)(4); 13 C.F.R. §120.971(a)(5); and SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 292, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
13 C.F.R. §120.971(b); and SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, p. 292, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.
SBA, "SOP 50 10 5(I): Lender and Development Company Loan Programs," effective January 1, 2017, pp. 296-297, at https://www.sba.gov/sites/default/files/sops/SOP_50_10_5_I_FINAL_Clean_Highlighted_Changes.pdf.