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Notice

Gulf Opportunity Pilot Loan Program (GO Loan Pilot)

Document Details

Information about this document as published in the Federal Register.

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This document has been published in the Federal Register. Use the PDF linked in the document sidebar for the official electronic format.

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AGENCY:

U.S. Small Business Administration (SBA).

ACTION:

Notice of extension of waiver of regulatory provisions.

SUMMARY:

This notice announces the extension of the “Notice of waiver of regulatory provisions” for SBA's GO Loan Pilot until September 30, 2011. Due to the scope and magnitude of the devastation to Presidentially-declared disaster areas resulting from Hurricanes Katrina and Rita as well as the further devastation by the BP Oil Spill that began on April 20, 2010, the Agency is extending its full guaranty and streamlined and centralized loan processing available through the GO Loan Pilot to small businesses in the eligible parishes/counties through September 30, 2011.

DATES:

The waiver of regulatory provisions published in the Federal Register on November 17, 2005, is extended under this Notice until September 30, 2011.

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FOR FURTHER INFORMATION CONTACT:

Gail Hepler, Office of Financial Assistance, U.S. Small Business Administration, 409 Third Street, SW., Washington, DC 20416; Telephone (202) 205-7530; gail.hepler@sba.gov.

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SUPPLEMENTARY INFORMATION:

On November 8, 2005, SBA initiated the GO Loan Pilot program which was designed to provide expedited small business financial assistance to businesses located in those communities severely impacted by Hurricanes Katrina and Rita. Under this unique initiative, SBA provides its full (85%) guaranty and streamlined and centralized loan processing to all eligible lenders that agree to make expedited SBA 7(a) loans available to small businesses located in, locating to or re-locating in the parishes/counties that have been Presidentially-declared as disaster areas resulting from Hurricanes Katrina and Rita, plus any contiguous parishes/counties.

To maximize the effectiveness of the GO Loan Pilot, on November 17, 2005, SBA published a notice in the Federal Register waiving for the GO Loan Pilot certain Agency regulations for the 7(a) Business Loan Program. (70 FR 69645). Because the pilot was designed as a temporary program scheduled to expire on September 30, 2006, and was extended to September 30, 2010, the waiver of certain Agency regulations also is due to expire on September 30, 2010. However, the Agency believes that there is a continuing, substantial need for the specific SBA assistance provided by this pilot in the affected areas.

When compared to other similarly-sized Section 7(a) loans, the GO Loan portfolio is performing very well, at about one-half the rate of liquidation and one-quarter the rate of loan purchase compared to all other 7(a) loans of $150,000 or less. In addition, the demand for GO Loans has continued during FY2010 in response to the ongoing need to rebuild the Gulf Coast areas devastated by Hurricanes Katrina and Rita. The annualized number of GO Loans approved in FY 2010 is about the same as the number of approvals for FY 2009 at approximately 560 loans per year. Also, the Deepwater BP oil spill that began April 20, 2010, has further devastated the Gulf Coast region and adversely affected many small businesses.

Thus, the Agency believes it is appropriate to extend this unique and vital program through September 30, 2011. Accordingly, the SBA is also extending its waiver of the Agency regulations identified in the Federal Register notice at 70 FR 69645 through September 30, 2011. SBA's waiver of these provisions is authorized by regulations. These waivers apply only to those loans approved under the GO Loan Pilot and will last only for the duration of the Pilot, which expires September 30, 2011. As part of the GO Loan Pilot, these waivers apply only to those small businesses located in, locating to, or relocating in the parishes/counties that have been Presidentially-declared as disaster areas resulting from Hurricanes Katrina or Rita, plus any contiguous parishes/counties. A list of all eligible parishes/counties will be included in an SBA procedural notice that will announce the extension of the GO Loan Pilot.

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Authority: 15 U.S.C. 636(a)(24); 13 CFR 120.3.

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Eric R. Zarnikow,

Associate Administrator, Office of Capital Access.

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[FR Doc. 2010-21436 Filed 8-27-10; 8:45 am]

BILLING CODE 8025-01-P