According to SBA officials, when a disaster is declared in an area, a staff member from an SBA field operations center, located in Atlanta, Georgia, or Sacramento, California, contacts the area’s SBDC network to identify a site for setting up a business recovery center, which may be the local SBDC office. Officials added that SBDC staff members co-locate in a business recovery center, when possible, so business loan applicants can access SBDC services at the center. Additionally, SBA officials said that SBDCs help SBA by doing the following: conducting local outreach to disaster victims, assisting declined business loan applicants or applicants who have withdrawn their loan applications with applications for reconsideration or re-acceptance, assisting declined applicants in remedying issues that initially precluded loan approvals, and providing business loan applicants with technical assistance, including helping businesses reconstruct business records, helping applicants better understand what is required to complete a loan application, compiling financial statements, and collecting required documents. SBA offers two types of disaster loans for businesses: (1) Physical Disaster Loans, which help replace damaged property or restore property to pre-disaster condition, and (2) Economic Injury Disaster Loans, which provide working capital to help small businesses survive until normal operations resume after a disaster. See table 1 for additional details of both types of disaster business loans. SBA has divided the disaster loan process into three steps: application, verification and loan processing, and closing, as shown in figure 1. This report focuses on step 1, the loan application process. Physical Disaster Loan applicants have 60 days and Economic Injury Disaster Loan applicants have 9 months from the date of disaster declaration to apply for a loan. Disaster victims may apply for a disaster business loan through the Electronic Loan Application online portal or by paper submission. The information from online and paper applications is loaded into SBA’s Disaster Credit Management System, which is the system SBA uses to process loan applications and make determinations for its disaster loan program. The Paperwork Reduction Act seeks to “ensure the greatest possible public benefit from and maximize the utility of information created, collected, maintained, used, shared, and disseminated by or for the Federal Government.” A collection of information, such as forms, includes a request for information from 10 or more persons to be submitted to the federal government. The act requires agencies to establish a process for evaluating and approving collections of information. The act created the Office of Information and Regulatory Affairs (OIRA) within the Office of Management and Budget (OMB) to perform all Paperwork Reduction Act functions. As part of the review process for a collection of information, OMB’s director must determine whether or not an agency’s proposed collection of information should be approved for public use. The director may approve a collection of information for a maximum of 3 years. Agencies are required to renew information collection forms before expiration to maintain a valid OMB control number. In addition to the process requirement, the act includes broader requirements, including that agencies reduce information collection burdens on the public, ensure that the public has timely and equitable access to public information, and improve information technology practices to reduce burden. SBA’s disaster business loan application forms are examples of a collection of information, so each form must be approved by OMB. SBA requires all disaster victims in need of a disaster business loan to submit the applicable loan application forms. To apply for a loan, a disaster victim must complete the required disaster business loan application forms (see app. II) and relevant additional forms: SBA Form 5 – Disaster Business Loan Application; OMB Control Number 3245-0017; expiring on January 31, 2018 (see app. II, fig. 5). SBA Form 413D – Personal Financial Statement; OMB Control Number 3245-0188; expiring on January 31, 2018 (see app. II, fig. 6). SBA Form 1368 – Additional Filing Requirements Economic Injury Disaster Loan and Military Reservist Economic Injury Disaster Loan; OMB Control Number 3245-0017; expiring on January 31, 2018 (see app. II, fig. 7). SBA Form 159D – Fee Disclosure Form and Compensation Agreement; OMB Control Number 3245-0201; expiring on October 31, 2017 (see app. II, fig. 8). Internal Revenue Service (IRS) Form 4506-T – Request for Transcript of Tax Return; OMB Control Number 1545-1872; expiring on December 31, 2016 (see app. II, fig. 9). Figure 2 shows that, according to SBA, in fiscal year 2014 it took a disaster business loan applicant approximately 4.5 hours to complete all the relevant forms, including gathering required documentation such as the most recent tax return. Consistent with the Paperwork Reduction Act’s requirement that agencies establish a review process, SBA’s Records Management Division oversees SBA’s Paperwork Reduction Act Clearance Process, which is documented in a standard operating procedure (SOP). The Paperwork Reduction Act requires an agency to establish a process to evaluate an information collection. SBA’s 2006 Forms Management Program, SOP 00 30 3, provides written operating procedures for the agency’s Paperwork Reduction Act clearance process. Figure 3 shows the overall process. First, Records Management Division officials identify which SBA forms will expire in 6 months, determine the program office responsible for each form, and issue an expiration memorandum to the program office with a timeline to complete the Paperwork Reduction Act clearance process. The Records Management Division uses the Regulatory Information Service Center and Office of Information and Regulatory Affairs Consolidated Information System, OMB’s electronic system, to identify which collections of information, such as loan application forms, will expire in 6 months. Next, Records Management Division officials said they solicit public comments and coordinate with the relevant program offices as well as Office of General Counsel (OGC) and Office of Inspector General (OIG) to evaluate the information collection. After the internal reviews are completed, the Records Management Division submits the Paperwork Reduction Act submission package to OMB electronically and concurrently posts a 30-day Federal Register notice seeking public comment on the proposed collection of information. Following this comment period, OMB notifies SBA whether it has approved SBA’s Paperwork Reduction Act submission package and, if approved, provides the OMB control number and expiration date for the approved forms. SBA’s requirement that program offices complete and sign routing forms aligns with Paperwork Reduction Act requirements that the head of an agency certify that the information collection is necessary for the proper performance of the agency’s functions. The Records Management Division coordinates the program office reviews. For example, ODA oversees the renewal of Forms 5 and 1368. Two forms, OMB Form 83-I and SBA’s Form 58, document that program offices involved in the collection of information have reviewed and approved the Paperwork Reduction Act submission package. The first form is OMB Form 83-I, which is OMB’s Paperwork Reduction Act submission form that an agency uses to certify that it is in compliance with the Paperwork Reduction Act requirements by identifying the type and purpose of the collection information being submitted to OMB. Form 83-I also includes a supporting statement, which justifies the necessity of a collection of information and use of statistical methods to reduce burden, if applicable. The second form is SBA’s Form 58, which is SBA’s Record of Clearance and Approval that tracks the completion of SBA’s Paperwork Reduction Act Clearance Process. SBA program offices responsible for the renewal of the collection of information, such as ODA, complete these forms and document approval by the necessary SBA stakeholders. SBA’s requirement that OGC review and provide feedback on each Paperwork Reduction Act submission package before it is sent to OMB conforms to the act’s requirements for independent review of the information collection. The Paperwork Reduction Act requires an agency to establish an independent process that evaluates whether or not the Paperwork Reduction Act submission package meets the act’s requirements. SBA Form 58 allows the involved program offices and OGC to review the Paperwork Reduction Act submission package and verify its compliance with the act’s requirements. OGC officials stated that they review OMB Form 83-I, supporting statements, and applicable information collection instruments to ensure compliance with Paperwork Reduction Act requirements. OGC also determines whether recent statutory, regulatory, or other changes are reflected in the collection of information and described in the supporting statement document. OIG also reviews and comments on each Paperwork Reduction Act submission package before it is sent to OMB. According to OIG officials, their comments are intended to make the program stronger and address difficulties encountered in criminal, civil, or administrative matters that changes to the form could help avoid in the future. OIG officials said they also review for clarity and check for issues and deficiencies that OIG has identified in prior audits. OIG officials stated that they do not sign the SBA Form 58 to preserve their independence and not create a perception that the OIG endorses a program office’s document. According to SBA, the agency’s policy to have both OGC and OIG review and have OGC sign- off on a Paperwork Reduction Act submission package helps the agency not only to achieve its goal of getting OMB to approve the package prior to the expiration of a disaster business loan form, but also to identify and address risks or areas of noncompliance. Consistent with applicable federal internal controls, SBA has a monitoring system to identify and remedy deficiencies in the Paperwork Reduction Act clearance process. Federal internal control standards state that management should establish and operate activities to monitor controls and that management should also remediate identified internal control deficiencies on a timely basis.