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Business Development RLF Grants Guidelines:

Appendix B


Grantees must provide the Appalachian Regional Commission (ARC) a semiannual financial report in the format prescribed by this appendix. The Semiannual Financial Report required of ARC RLF Grantees consists of Schedules B-1, B-2 and B-3 attached to this appendix.

The Semiannual Financial Report should reach ARC not later than one month after the established cut off date. See Table B-1 for ARC RLF grantee semiannual financial report cut off dates. Grantees are to advise ARC if a semiannual report cannot be submitted within this time frame.

Schedule B-1 is the Grantee's Statement of Funds Available from the Inception of the Fund. This schedule provides a cumulative to (cut off) date picture of RLF activity and is required by ARC to evaluate a grantee's use of funds previously advanced. Loan commitments not disbursed as of the cut off date are included in the schedule to assist in the evaluation of a grantee's cash holding (see paragraph VI.D., these guidelines). A loan summary section is included to reconcile with the total Unpaid Principal Balance column of Schedule B-2, and to identify principal balances written off and other specific adjustments made by grantees. The grantee's RLF Manager certifies the semiannual report on the bottom of this schedule.

Schedule B-2 is a listing of all loans having an outstanding principal balance at any time during the reporting period. This schedule provides ARC with a status, as each loan progresses through its term. The schedule requires the identification of delinquent loan status. ARC uses the reported information to obtain current jobs created and jobs saved numbers. ARC evaluates the borrower's job performance against a grantee's operating plan jobs requirement.

Schedule B-3 requires a statement from the grantee on each delinquent loan outlining the actions underway to resolve the situation and/or preserve ARC's financial interests.

Should a grantee's internal accounting system generate local management reports that contain the information required in Schedules B-1 and/or B-2, ARC will accept these alternate reports.

Preparing Schedule B-1

Entries in the Receipts, Disbursements and Set Aside and most in the Loan Summary sections are cumulative dollars from the funds inception. The RLF activity for the current reporting period is added to the preceding report totals to arrive at the new number. ARC will calculate the current reporting period data, if needed.

  1. Thru: Enter the appropriate cut off date, as shown, for a grantee from Table B-1.

    Receipts

  2. Funds Received from ARC: The amount on this line should represent only the cumulative amount of grant funds received by the grantee as a result of advance payments made to close loans. Some older ARC RLF grants had administrative expense components to them. The administrative expense portion of RLF grants should not be included in this number.

  3. Loan Balance Transferred from PCLF 10/1/92: This line is used only by grantees in Pennsylvania. The amounts on this line represent the outstanding PCLF loan balance transferred to these grantees by the Pennsylvania Department of Commerce. Affected grantees have been reporting this number to ARC since that date.

  4. Loan Principal Repayments: This line represents borrower repayments of the principal amount of a loan. Deferred interest, fees, penalty interest etc. are not included as loan principal. Restructured loans created to rephase payments, lengthen the term, etc. have the original unpaid principal as a core. Payments on this line should only identify that portion of a borrower payment that is assigned by a grantee to reduce the original loan principal.

  5. Interest on Loans: Use this line for the portion of a borrower's payment that is designated by the grantee as interest. Penalty interest is reported on the line for late payment fees/interest.

  6. Loan Fees: Fees derived from charges levied on the borrower for specific services such as processing a loan application, servicing a loan, loan closing, etc. are included on this line. This includes repayment additives identified as premiums (points).

  7. Investment Interest: This line is for interest earned on a grantee's unloaned fund balances. Unloaned funds must be placed in interest earning accounts pending new loans.

  8. Late Payment Fees/Interest: Use this line for late payment charges collected from the borrower. These may be an interest penalty or a flat fee for late/delinquent loan payments.

  9. Other: Grantees must explain the income source for this line. Use of this line should be rare given the detail provided in the "Receipts" section.

  10. Total Receipts Available for Disbursement: This line represents all receipts by the RLF program from inception of the fund.

    Disbursements and Set Asides

  11. Loan Balances Assumed from PCLF 10/1/92: This line is used only by grantees in Pennsylvania. The amounts on this line offset the "Loan Balance Transferred from PCLF 10/1/92" line in the "Receipts" section and represent the PCLF loan balances that Pennsylvania grantees have been responsible for collecting. This number always remains the same and has been reported by each Pennsylvania grantee since the above date.

  12. Loans Disbursed by Grantee: The principal amount of all loans disbursed since the inception of the fund. The original principal amount of a loan is the dollar requirement needed by the borrower for the project. If a loan is restructured to change the terms (interest rate or length) or to rephase (defer) or reamortize interest payments the original principal loan amount outstanding does not change.

  13. RLF Administrative Costs: This line is used to record, from the inception of the fund, reasonable and necessary administration costs of the RLF that have been charged against the program income (see paragraphs VI.B.2. & 3., these guidelines). In addition to direct staff expenses, administrative costs may include the costs of required audit (see paragraph VI.F., these guidelines), loan closing costs, filing fees, costs of recovering collateral from delinquent loans, court costs, and indirect support costs of RLF staff.

  14. 14. Grant Funds Returned to ARC: This line is used for:

    1. Excess unloaned funds returned to ARC since the inception of the fund as required by paragraph VI.D., these guidelines, and

    2. The return of grant funds since the inception of the fund by the grantee for other reasons, such as an erroneous payment, loan postponed or cancelled, etc.

       

  15. Program Income Set Asides: This line is used to record the amount of program income a grantee has set aside since the inception of the fund, based upon specific authority (contract amendment) provided by ARC.

  16. Other: Grantees must specifically identify and explain each type of disbursement shown on this line. Use of this line should be rare given the detail provided in the "Disbursements and Set Asides" section.

  17. Total Disbursed and Set Aside: This line should represent the total of all disbursements and set asides since the inception of the fund.

  18. Funds Available for Loans: This line is the difference between the amount on the Total Receipts Available for Disbursements line and the amount on the Total Disbursed and Set Aside line.

    Loans Committed

  19. End of Period Loan Commitments: Enter on this line the amount of approved loans that have been committed to but not closed as of the end of the reporting period.

  20. Net Loanable Funds Available to the Grantee: This line represents the amount of unencumbered loan funds available for new loans on the cut off date.

    Loan Summary

  21. Total Loans Disbursed and Balances Assumed: On this line place the total of the amounts on the Loan Balances Assumed from PCLF 10/1/92, if appropriate, and Loans Disbursed by Grantee lines from the Disbursements and Set Asides section above.

  22. Loan Principal Repayments: On this line place the amount of loan repayments from the Loan Principal Repayments line in the Receipts section.

  23. Unpaid Principal Balance: Calculate the difference between items 21. & 22. above.

  24. Loan Balances Written Off: On this line record the cumulative amount of loans written off by the Grantee's loan approval authority.

  25. Grantee Adjustments: Grantees must specifically identify each type of adjustment. Attach a continuation sheet explaining the adjustment if necessary.

  26. Reported Balance of Loans Outstanding: This amount must agree with the total of column 6 on Schedule B-2.

Preparing Schedule B-2

Schedule B-2 is a listing of a Grantee's outstanding loan balances during the reporting period. The loan principal balances shown on this schedule, column 6, are, in aggregate, the Reported Balance of Loans Outstanding at the bottom of Schedule B-2 (see the * on each schedule). All loans having a principal balance during the reporting period are included on this schedule. Loans that were fully repaid in a previous period or written off in a previous period should not be shown on the schedule for the current period.

  1. Reporting Period Ending: Enter the appropriate cut off date, as shown, for the grantee in Table B-1.

  2. Column 1, Name, City/Co. & State of Borrower: Enter identification information of the borrower. If the borrower's business is not located in a city, show only the county and state in which located.

  3. Column 2, Original Loan Amount: Enter the original amount borrowed. Even though a loan may be restructured or a deferred interest accrual is amortized, only the unpaid balance of the original loan that is an integral part of the borrower's project is entered in this column.

  4. 4. Column 3, Date Loan Closed: Enter the loan closing date in the following format: month/day/year. For example (04/01/98).

  5. Column 4, Interest Rate: Enter the rate as a percentage.

  6. Column 5, Term of Loan: Show term as years and months.

  7. Column 6, Principal Balance as of Cut Off Date: If a loan had a principal balance at the beginning of the current reporting period, it is reported for the current period with the principal balance at the end of the period. The reported balance would be zero if the loan was paid off or written off during the reporting period.

  8. Column 7, Loan Current? Or How Long Delinquent?: Enter yes, or how long the loan has been delinquent, in months.

  9. Column 8, Jobs Created(C)/Jobs Saved(S): The schedule should show the most current success in creating and saving jobs during the reporting period.

Preparing Schedule B-3

Schedule B-3 is used to report grantee actions taken to resolve the delinquent status of certain loans. Please refer to the grantee's RLF Operating Plan for a definition of a delinquent loan. Do not use this schedule to report late payments that do not meet a grantee's definition of a delinquent unpaid principal balance.

  1. Reporting Period Ending: Enter the appropriate cut off date, as shown, for the grantee in Table B-1.
  2. Column 1, Name of Borrower: Enter the borrower's name as shown on Schedule B-2.
  3. Column 2, Delinquent Unpaid Principal Balance: Enter only that portion of the unpaid principal balance that is considered delinquent under the reporting grantee's established criteria for declaring a loan or portion thereof delinquent.

  4. Column 3, Narrative Statement of Actions: Report the actions taken by the grantee to collect delinquent balances or other actions necessary to restructure (work out) a loan payment amortization that will bring the loan current. Report actions by the grantee to recover collateralized property as a result of non-payment of a loan.


ARC Business Development RLF Guidelines | Appendix A | The RLF Form | Table B-1 | Schedule B-1 | Schedule B-2 | Schedule B-3 | Appendix C