EDA Revises Regulations for Revolving Loan Fund Program

摘要

The Economic Development Administration (EDA) has revised the regulations for its revolving loan fund (RLF) program to conform to guidance issued in response to a 2007 Office of Inspector General (OIG) report and make sure that all RLF recipients follow program requirements. An interim final rule was published in the October 22 Federal Register for immediate effect, and comments are due December 22. Under one change, RLF capital can no longer be used to guarantee loans. While the guarantee authority has rarely been used, EDA has decided that guarantees are too risky since they are backed only by the assets in the RLF. In addition, to strengthen program monitoring and ensure that RLF capital is used for loans that are consistent with the RLF plan or other EDA-approved purposes, the revised rules require a compliance and loan quality review by an independent third party every three years.