15 U.S.C. § 634 : US Code - Section 634: General powers

Search 15 U.S.C. § 634 : US Code - Section 634: General powers

(a) Seal; appointment and compensation of personnel; use of other
services and facilities
The Administration shall have power to adopt, alter, and use a
seal, which shall be judicially noticed. The Administrator is
authorized, subject to the civil service and classification laws,
to select, employ, appoint, and fix the compensation of such
officers, employees, attorneys, and agents as shall be necessary to
carry out the provisions of this chapter; to define their authority
and duties; and to pay the costs of qualification of certain of
them as notaries public. The Administration, with the consent of
any board, commission, independent establishment, or executive
department of the Government, may avail itself on a reimbursable or
nonreimbursable basis of the use of information, services,
facilities (including any field service thereof), officers, and
employees thereof, in carrying out the provisions of this chapter.
(b) Powers of Administrator
In the performance of, and with respect to, the functions,
powers, and duties vested in him by this chapter the Administrator
may -
(1) sue and be sued in any court of record of a State having
general jurisdiction, or in any United States district court, and
jurisdiction is conferred upon such district court to determine
such controversies without regard to the amount in controversy;
but no attachment, injunction, garnishment, or other similar
process, mesne or final, shall be issued against the
Administrator or his property;
(2) under regulations prescribed by him, assign or sell at
public or private sale, or otherwise dispose of for cash or
credit, in his discretion and upon such terms and conditions and
for such consideration as the Administrator shall determine to be
reasonable, any evidence of debt, contract, claim, personal
property, or security assigned to or held by him in connection
with the payment of loans granted under this chapter, and to
collect or compromise all obligations assigned to or held by him
and all legal or equitable rights accruing to him in connection
with the payment of such loans until such time as such
obligations may be referred to the Attorney General for suit or
collection;
(3) deal with, complete, renovate, improve, modernize, insure,
or rent, or sell for cash or credit upon such terms and
conditions and for such consideration as the Administrator shall
determine to be reasonable, any real property conveyed to or
otherwise acquired by him in connection with the payment of loans
granted under this chapter;
(4) pursue to final collection, by way of compromise or
otherwise, all claims against third parties assigned to the
Administrator in connection with loans made by him. This shall
include authority to obtain deficiency judgments or otherwise in
the case of mortgages assigned to the Administrator. Section 5 of
title 41 shall not be construed to apply to any contract of
hazard insurance or to any purchase or contract for services or
supplies on account of property obtained by the Administrator as
a result of loans made under this chapter if the premium therefor
or the amount thereof does not exceed $1,000. The power to convey
and to execute in the name of the Administrator deeds of
conveyance, deeds of release, assignments and satisfactions of
mortgages, and any other written instrument relating to real
property or any interest therein acquired by the Administrator
pursuant to the provisions of this chapter may be exercised by
the Administrator or by any officer or agent appointed by him
without the execution of any express delegation of power or power
of attorney. Nothing in this section shall be construed to
prevent the Administrator from delegating such power by order or
by power of attorney, in his discretion, to any officer or agent
he may appoint;
(5) acquire, in any lawful manner, any property (real,
personal, or mixed, tangible or intangible), whenever deemed
necessary or appropriate to the conduct of the activities
authorized in sections 636(a) and 636(b) of this title;
(6) make such rules and regulations as he deems necessary to
carry out the authority vested in him by or pursuant to this
chapter;
(7) in addition to any powers, functions, privileges and
immunities otherwise vested in him, take any and all actions
(including the procurement of the services of attorneys by
contract in any office where an attorney or attorneys are not or
cannot be economically employed full time to render such
services) when he determines such actions are necessary or
desirable in making, servicing, compromising, modifying,
liquidating, or otherwise dealing with or realizing on loans made
under the provisions of this chapter: Provided, That with respect
to deferred participation loans, the Administrator may, in the
discretion of and pursuant to regulations promulgated by the
Administrator, authorize participating lending institutions to
take actions relating to loan servicing on behalf of the
Administrator, including determining eligibility and
creditworthiness and loan monitoring, collection, and
liquidation;
(8) pay the transportation expenses and per diem in lieu of
subsistence expenses, in accordance with subchapter I of chapter
57 of title 5, for travel of any person employed by the
Administration to render temporary services not in excess of six
months in connection with any disaster referred to in section
636(b) of this title from place of appointment to, and while at,
the disaster area and any other temporary posts of duty and
return upon completion of the assignment: Provided, That the
Administrator may extend the six-month limitation for an
additional six months if the Administrator determines the
extension is necessary to continue efficient disaster loan making
activities;
(9) accept the services and facilities of Federal, State, and
local agencies and groups, both public and private, and utilize
such gratuitous services and facilities as may, from time to
time, be necessary, to further the objectives of section 636(b)
of this title;
(10) upon purchase by the Administration of any deferred
participation entered into under section 636 of this title,
continue to charge a rate of interest not to exceed that
initially charged by the participating institution on the amount
so purchased for the remaining term of the indebtedness;
(11) make such investigations as he deems necessary to
determine whether a recipient of or participant in any assistance
under this chapter or any other person has engaged or is about to
engage in any acts or practices which constitute or will
constitute a violation of any provision of this chapter, or of
any rule or regulation under this chapter, or of any order issued
under this chapter. The Administration shall permit any person to
file with it a statement in writing, under oath or otherwise as
the Administration shall determine, as to all the facts and
circumstances concerning the matter to be investigated. For the
purpose of any investigation, the Administration is empowered to
administer oaths and affirmations, subpena witnesses, compel
their attendance, take evidence, and require the production of
any books, papers, and documents which are relevant to the
inquiry. Such attendance of witnesses and the production of any
such records may be required from any place in the United States.
In case of contumacy by, or refusal to obey a subpena issued to,
any person, including a recipient or participant, the
Administration may invoke the aid of any court of the United
States within the jurisdiction of which such investigation or
proceeding is carried on, or where such person resides or carries
on business, in requiring the attendance and testimony of
witnesses and the production of books, papers, and documents; and
such court may issue an order requiring such person to appear
before the Administration, there to produce records, if so
ordered, or to give testimony touching the matter under
investigation. Any failure to obey such order of the court may be
punished by such court as a contempt thereof. All process in any
such case may be served in the judicial district whereof such
person is an inhabitant or wherever he may be found;
(12) impose, retain, and use only those fees which are
specifically authorized by law or which are in effect on
September 30, 1994, and in the amounts and at the rates in effect
on such date, except that the Administrator may, subject to
approval in appropriations Acts, impose, retain, and utilize,
additional fees -
(A) not to exceed $100 for each loan servicing action (other
than a loan assumption) requested after disbursement of the
loan, including any substitution of collateral, release or
substitution of a guarantor, reamortization, or similar action;
(B) not to exceed $300 for loan assumptions;
(C) not to exceed 1 percent of the amount of requested
financings under title III of the Small Business Investment Act
of 1958 [15 U.S.C. 681 et seq.] for which the applicant
requests a commitment from the Administration for funding
during the following year; and
(D) to recover the direct, incremental cost involved in the
production and dissemination of compilations of information
produced by the Administration under the authority of this
chapter and the Small Business Investment Act of 1958 [15
U.S.C. 661 et seq.];
(13) collect, retain and utilize, subject to approval in
appropriations Acts, any amounts collected by fiscal transfer
agents and not used by such agent as payment of the cost of loan
pooling or debenture servicing operations, except that amounts
collected under this paragraph and paragraph (12) shall be
utilized solely to facilitate the administration of the program
that generated the excess amounts; and
(14) require any lender authorized to make loans under section
636 of this title to pay examination and review fees, which shall
be deposited in the account for salaries and expenses of the
Administration, and shall be available for the costs of
examinations, reviews, and other lender oversight activities.
(c) Procurement of experts and consultants; compensation and
expenses
To such extent as he finds necessary to carry out the provisions
of this chapter, the Administrator is authorized to procure the
temporary (not in excess of one year) or intermittent services of
experts or consultants or organizations thereof, including
stenographic reporting services, by contract or appointment, and in
such cases such services shall be without regard to the civil-
service and classification laws and, except in the case of
stenographic reporting services by organizations, without regard to
section 5 of title 41. Any individual so employed may be
compensated at a rate not in excess of the daily equivalent of the
highest rate payable under section 5332 of title 5, including
travel time, and, while such individual is away from his or her
home or regular place of business, he or she may be allowed travel
expenses (including per diem in lieu of subsistence) as authorized
by section 5703 of title 5.
(d) Safety deposit box rentals
Section 3324(a) and (b) of title 31 shall not apply to
prepayments of rentals made by the Administration on safety deposit
boxes used by the Administration for the safeguarding of
instruments held as security for loans or for the safeguarding of
other documents.
(e) Undertaking or suspension of payment obligation; period;
extension of maturity; repayment agreement; "required payments"
defined
(1) Subject to the requirements and conditions contained in this
subsection, upon application by a small business concern which is
the recipient of a loan made under this chapter, the Administration
may undertake the small business concern's obligation to make the
required payments under such loan or may suspend such obligation if
the loan was a direct loan made by the Administration. While such
payments are being made by the Administration pursuant to the
undertaking of such obligation or while such obligation is
suspended, no such payment with respect to the loan may be required
from the small business concern.
(2) The Administration may undertake or suspend for a period of
not to exceed 5 years any small business concern's obligation under
this subsection only if -
(A) without such undertaking or suspension of the obligation,
the small business concern would, in the sole discretion of the
Administration, become insolvent or remain insolvent;
(B) with the undertaking or suspension of the obligation, the
small business concern would, in the sole discretion of the
Administration, become or remain a viable small business entity;
and
(C) the small business concern executes an agreement in writing
satisfactory to the Administration as provided by paragraph (4).
(3) Notwithstanding the provisions of sections 636(a)(4)(C) and
636(i)(1) of this title, the Administration may extend the maturity
of any loan on which the Administration undertakes or suspends the
obligation pursuant to this subsection for a corresponding period
of time.
(4)(A) Prior to the undertaking or suspension by the
Administration of any small business concern's obligation under
this subsection, the Administration, consistent with the purposes
sought to be achieved herein, shall require the small business
concern to agree in writing to repay to it the aggregate amount of
the payments which were required under the loan during the period
for which such obligation was undertaken or suspended, either -
(i) by periodic payments not less in amount or less frequently
falling due than those which were due under the loan during such
period, or
(ii) pursuant to a repayment schedule agreed upon by the
Administration and the small business concern, or
(iii) by a combination of the payments described in clause (i)
and clause (ii).
(B) In addition to requiring the small business concern to
execute the agreement described in subparagraph (A), the
Administration shall, prior to the undertaking or suspension of the
obligation, take such action, and require the small business
concern to take such action as the Administration deems appropriate
in the circumstances, including the provision of such security as
the Administration deems necessary or appropriate to insure that
the rights and interests of the lender (Small Business
Administration or participant) will be safeguarded adequately
during and after the period in which such obligation is so
undertaken or suspended.
(5) The term "required payments" with respect to any loan means
payments of principal and interest under the loan.
(f) Sale of guaranteed portion of loans by lender or subsequent
holder; limitations; secondary market
(1) The guaranteed portion of any loan made pursuant to this
chapter may be sold by the lender, and by any subsequent holder,
consistent with regulations on such sales as the Administration
shall establish, subject to the following limitations:
(A) prior to the Administration's approval of the sale, or upon
any subsequent resale, of any loan guaranteed by the
Administration, if the lender certifies that such loan has been
properly closed and that the lender has substantially complied
with the provisions of the guarantee agreement and the
regulations of the Administration, the Administration shall
review and approve only materials not previously approved;
(B) all fees due the Administration on a guaranteed loan shall
have been paid in full prior to any sale; and
(C) each loan, except each loan made under section 636(a)(14)
of this title, shall have been fully disbursed to the borrower
prior to any sale.
(2) After a loan is sold in the secondary market, the lender
shall remain obligated under its guarantee agreement with the
Administration, and shall continue to service the loan in a manner
consistent with the terms and conditions of such agreement.
(3) The Administration shall develop such procedures as are
necessary for the facilitation, administration, and promotion of
secondary market operations, and for assessing the increase of
small business access to capital at reasonable rates and terms as a
result of secondary market operations. Beginning on March 31, 1997,
the sale of the unguaranteed portion of any loan made under section
636(a) of this title shall not be permitted until a final
regulation that applies uniformly to both depository institutions
and other lenders is promulgated by the Administration setting
forth the terms and conditions under which such sales can be
permitted, including maintenance of appropriate reserve
requirements and other safeguards to protect the safety and
soundness of the program.
(4) Nothing in this subsection or subsection (g) of this section
shall be interpreted to impede or extinguish the right of the
borrower or the successor in interest to such borrower to prepay
(in whole or in part) any loan made pursuant to section 636(a) of
this title, the guaranteed portion of which may be included in such
trust or pool, or to impede or extinguish the rights of any party
pursuant to section 636(a)(6)(C) of this title or subsection (e) of
this section.
(g) Trust certificates; guarantee of timely payments of principal
and interest; full faith and credit of United States; collection
of fees; subrogation
(1) The Administration is authorized to issue trust certificates
representing ownership of all or a fractional part of the
guaranteed portion of one or more loans which have been guaranteed
by the Administration under this chapter, or under section 696 of
this title: Provided, That such trust certificates shall be based
on and backed by a trust or pool approved by the Administration and
composed solely of the entire guaranteed portion of such loans.
(2) The Administration is authorized, upon such terms and
conditions as are deemed appropriate, to guarantee the timely
payment of the principal of and interest on trust certificates
issued by the Administration or its agent for purposes of this
subsection. Such guarantee shall be limited to the extent of
principal and interest on the guaranteed portions of loans which
compose the trust or pool. In the event that a loan in such trust
or pool is prepaid, either voluntarily or in the event of default,
the guarantee of timely payment of principal and interest on the
trust certificates shall be reduced in proportion to the amount of
principal and interest such prepaid loan represents in the trust or
pool. Interest on prepaid or defaulted loans shall accrue and be
guaranteed by the Administration only through the date of payment
on the guarantee. During the term of the trust certificate, it may
be called for redemption due to prepayment or default of all loans
constituting the pool.
(3) The full faith and credit of the United States is pledged to
the payment of all amounts which may be required to be paid under
any guarantee of such trust certificates issued by the
Administration or its agent pursuant to this subsection.
(4)(A) The Administration may collect a fee for any loan
guarantee sold into the secondary market under subsection (f) of
this section in an amount equal to not more than 50 percent of the
portion of the sale price that exceeds 110 percent of the
outstanding principal amount of the portion of the loan guaranteed
by the Administration. Any such fee imposed by the Administration
shall be collected by the Administration or by the agent which
carries out on behalf of the Administration the central
registration functions required by subsection (h) of this section
and shall be paid to the Administration and used solely to reduce
the subsidy on loans guaranteed under section 636(a) of this title:
Provided, That such fee shall not be charged to the borrower whose
loan is guaranteed: and, Provided further, That nothing herein
shall preclude any agent of the Administration from collecting a
fee approved by the Administration for the functions described in
subsection (h)(2) (!1) of this section.
(B) The Administration is authorized to impose and collect,
either directly or through a fiscal and transfer agent, a
reasonable penalty on late payments of the fee authorized under
subparagraph (A) in an amount not to exceed 5 percent of such fee
per month plus interest.
(C) The Administration may contract with an agent to carry out,
on behalf of the Administration, the assessment and collection of
the annual fee established under section 636(a)(23) of this title.
The agent may receive, as compensation for services, any interest
earned on the fee while in the control of the agent before the time
at which the agent is contractually required to remit the fee to
the Administration.
(5)(A) In the event the Administration pays a claim under a
guarantee issued under this subsection, it shall be subrogated
fully to the rights satisfied by such payment.
(B) No State or local law, and no Federal law, shall preclude or
limit the exercise by the Administration of its ownership rights in
the portions of loans constituting the trust or pool against which
the trust certificates are issued.
(h) Central registration of loans and trust certificates; contracts
with agent; disclosures by sellers of guaranteed portions of
loans; regulation of brokers and dealers; electronic registration
(1) Upon the adoption of final rules and regulations, the
Administration shall -
(A) provide for a central registration of all loans and trust
certificates sold pursuant to subsections (f) and (g) of this
section;
(B) contract with an agent to carry out on behalf of the
Administration the central registration functions of this section
and the issuance of trust certificates to facilitate pooling.
Such agent shall provide a fidelity bond or insurance in such
amounts as the Administration determines to be necessary to fully
protect the interest of the Government;
(C) prior to any sale, require the seller to disclose to a
purchaser of the guaranteed portion of a loan guaranteed under
this chapter and to the purchaser of a trust certificate issued
pursuant to subsection (g) of this section, information on the
terms, conditions, and yield of such instrument. As used in this
paragraph, if the instrument being sold is a loan, the term
"seller" does not include (A) an entity which made the loan or
(B) any individual or entity which sells three or fewer
guaranteed loans per year; and
(D) have the authority to regulate brokers and dealers in
guaranteed loans and trust certificates sold pursuant to
subsections (f) and (g) of this section.
(2) The agent described in paragraph (1)(B) may be compensated
through any of the fees assessed under this section and any
interest earned on any funds collected by the agent while such
funds are in the control of the agent and before the time at which
the agent is contractually required to transfer such funds to the
Administration or to the holders of the trust certificates, as
appropriate.
(3) Nothing in this subsection shall prohibit the utilization of
a book-entry or other electronic form of registration for trust
certificates. The Administration may, with the consent of the
Secretary of the Treasury, use the book-entry system of the Federal
Reserve System.