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Federal Register / Vol. 86, No. 92 / Friday, May 14, 2021 / Rules and Regulations telephone: 202 6925233; email:
david.chestnut@usda.gov.
SUPPLEMENTARY INFORMATION:

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I. Background Rural Development is a mission area within USDA comprising the Rural Utilities Service, Rural Housing Service, and Rural Business-Cooperative Service.
Rural Developments mission is to increase economic opportunity and improve the quality of life for all rural Americans. Rural Development meets its mission by providing loans, loan guarantees, grants and technical assistance through more than 40
programs aimed at creating and improving housing, business, and infrastructure throughout rural America.
The Rural Microentrepreneur Assistance Program, administered by the Rural Business-Cooperative Service, was authorized by Section 379E of the Consolidated Farm and Rural Development Act ConAct. The ConAct established the RMAP to provide loans and grants to support microentrepreneurs in the development and ongoing success of rural microenterprises. The loans establish or augment a rural microentrepreneur revolving loan fund and the grants provide technical assistance and training to microenterprises.
II. Discussion of Public Comments From Interim Rule On May 28, 2010, the Agency published an interim rule with comments in the Federal Register 75
FR 30114 implementing RMAP. The interim rule was amended by the correcting amendments published in the Federal Register on July 19, 2010 75 FR
41695. Twenty-nine combined comments were received from one industry respondent, five sponsoring organizations and one individual. The Agency reviewed and considered all comments that were received. The following discusses each comment and the Agencys response:
Comment: The Loan Loss Reserve Fund LLRF usage and replenishment is too restrictive and a more workable approach is to utilize the Intermediary Relending Program IRP regulation 7
CFR 4274D.
Agency response: The Agency agreed, and the regulation has been revised to be more in line with the Intermediary Relending Program IRP.
Comment: Having a hard deadline of 90 days to close the loans was too difficult to meet in some cases.
Agency response: The Agency agreed, and the language was changed to permit the Agency, with justification and at its sole discretion, to extend the closing
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date deadline when circumstances warrant.
Comment: Concern was expressed for only being able to draw down funds to make loans every quarter as being unworkable. The 30-day micro borrower loan closing should be eliminated.
Agency response: The Agency agreed, and language was changed from must to should for the draw of funds which will allow the drawdown of funds as needed. The Agency disagrees with a change to the microborrower 30-day loan closing requirements as a Microenterprise Development Organizations MDO should only draw down funds for an identified project.
This prevents an MDO from paying interest on unused funds in their account that are not generating revenue for the program loan repayment.
Comment: The Agency should make it clear that one of the Agencys remedies for loan default was to withhold all mandatory grant payments until the microlender comes back into compliance.
Agency response: The Agency agreed, and the information has been delineated in the loan servicing section.
Comment: Making the Agency responsible to approve all key personnel changes is intrusive. The Legislative Affairs notification is set forth in another Rural Development regulation and is not needed here.
Agency response: The Agency agreed but will still require notification of significant personnel changes as such changes may impact the MDOs ability to manage a revolving loan fund. The Legislative Notification has been removed from Section 4280.313.
Comment: The technical assistance only grant portion of the regulation is not authorized by the Farm Bill, but rather technical assistance training grants are authorized by the Farm Bill.
Additionally, the current regulation ignores the training aspect of the law.
Agency response: The technical assistance only grant provisions are in the authorizing statute and were not eliminated in the 2018 Farm Bill language. Agency agreed with the training provisions comment and the regulation has been changed in Section 4280.313 to reflect that these grants should be for training type technical assistance to active and potential mircoborrowers as well as any microlenders who may wish to strengthen their technical skills through training.
Comment: Most commenters included comments on scoring: abandon the dual application system, scoring is subjective, scoring is overly complex, TA grant scoring does not reflect
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operating realities, scoring disfavors microlenders who specialize in servicing traditionally underserved populations, disfavors smaller MDOs who need to use the legally allowed 10
percent for administrative expenses, scoring uses vague definitions of current and delinquent borrowers, disfavors non-rural MDOs, and disfavors MDOs who provide training versus those MDOs who only make loans.
Agency response: The Agency considered each of the comments and reviewed the scoring system for possible revisions. Changes are described in Section III below.
Comment: Several comments were made concerning application processing. One of the commenters stated that a Loan Fund Work Plan or Scope of Work should be required of all applicants, and that some forms listed for the applicant to complete were internal forms and should be deleted.
Agency response: The Agency agreed, and the regulation has been revised to require a work plan from all applicants 4280.316c1 and internal forms have been removed from the applicants requirements.
Comment: One group of commenters cited several existing laws which define significant outmigration as a locality which has a loss of 10 percent or more in population in the past 20 years.
Agency response: The Agency agreed, and the definition was changed to conform with the definition used by the Economic Research Service.
Comment: The definition of full-time equivalent does not agree with other Rural Development definitions.
Agency response: The Agency agreed, and the definition was revised to be similar to other Agency regulations.
Comment: The definition of delinquency should be redefined to the dollars and number of loans behind more than 30 days in any one-year period.
Agency response: The Agency agreed in principle and included in the definition that the year be the federal fiscal year. Delinquency parameters were added to 4280.311e4 to better define satisfactory performance.
Comment: Non-profit organizations cannot have citizenship and the wording should be changed to state organized under the laws of the state.
Agency response: The Agency agrees that non-profit entities have no ownership but retain its requirement that non-profit entities must be controlled by a majority of US citizens.
The provisions for state organization of a non-profit remains in 4280.310a2
and a tribal provision is now included in that section as well.

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