OMB Control Number 3245-0017
SBA Form 5, Disaster Business Loan Application
Form 1368, Additional Filing Requirements, Economic Injury Disaster Loan (EIDL), and Military Reservist Economic Injury Disaster Loan (MREIDL)
The purpose of this submission is to request an extension of the SBA’s Form 5, “Disaster Business Loan Application”-- the paper version of the application and the Electronic Loan Application (ELA) - and Form 1368, “Additional Filing Requirements, Economic Injury Disaster Loan (EIDL) and Military Reservists Economic Injury Disaster Loan (MREIDL).”
The following changes were made to the SBA Form 5:
Removed the Sole Proprietor checkbox on page one (Sole Proprietor applicants will not use the SBA Form 5C).
Added new filing requirement information regarding non-profit organizations (including Houses of Worship, Associations, etc.)
Changed Form 8821 to Form 4506T for the tax transcript request.
No changes were made to the SBA Form 1368.
Justification
Explain the circumstances that make the collection of information necessary. Identify any legal or administrative requirements that necessitate the collection. Attach a copy of the appropriate section of each statute and regulation mandating or authorizing the collection of information.
Section 7(b) of the Small Business Act, 15 USC 636, as amended, authorizes the Small Business Administration to make disaster loans to businesses. Three separate programs are authorized: 7(b) (1) physical disaster loans, 7(b) (2) economic injury disaster loans, and 7(b) (3) Military Reservist Economic Injury loans. Copies of all relevant citations are attached. OMB Circular A-129, Policies for Federal Credit Programs and Receivables, requires federal agencies to determine, among other things, whether loan applicants comply with statutory, regulatory, and administrative eligibility and other requirements for loan assistance. This information collection helps SBA to make that determination.
The requirement for the use of the Form 5 is found in the Standard Operating Procedure (SOP) for Disaster Assistance, SOP 50 30 8, appendix 5 and 6 (attached).
Indicate how, by whom, and for what purpose the information is to be used. Except for a new collection, indicate the actual use the agency has made of the information received from the current collection.
The business loan application (Form 5 and the ELA) is used for SBA’s three business loan programs: physical disaster loans, economic injury loans and Military Reservist economic injury loans. Nonprofit applicants, including churches and homeowner associations, also use the business loan application to apply for physical disaster loans and economic injury loans. The form is used to collect the basic information necessary to support a loan application from all business applicants, except for sole proprietors who will now use SBA Form 5C. SBA Form 1368, “Additional Filing Requirements, Economic Injury Disaster Loan (EIDL), and Military Reservist Economic Injury Disaster Loan (MREIDL) is used for economic injury disaster loans as a supplement to the business application form to establish the cause and extent of eligible economic injury resulting from a physical disaster. Applicants must supply the requested information in order to receive benefits from these programs. Applicants subject to this request are business or nonprofit entities. The Office of Disaster Assistance’s (ODA’s) loan officers and others use the collected information to make eligibility and credit decisions in order to approve or disapprove a loan.
Describe whether, and to what extent, the collection of information involves the use of automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g. permitting electronic submission of responses, and the basis for the decision for adopting this means of collection. Also describe any consideration of using information technology to reduce the burden.
The ELA is part of SBA’s Disaster Credit Management System (DCMS), ODA’s loan processing system, and gives loan applicants the option of completing the application on-line and submitting it electronically to SBA. The use of the ELA portal also allows disaster loan applicants to retrieve and modify existing data records resulting in minimal reduced data entry on their part.
Describe efforts to identify duplication. Show specifically why any similar information already available cannot be used or modified for use for the purposes described in item 2 above.
The information required on the application is applicant and time specific and is not otherwise available. No other application form or format is required.
If the collection of information impacts small businesses or other small entities (Item 5 of OMB Form 83-I), describe any methods used to minimize burden.
This information collection impacts small businesses; however, it will not have a significant economic impact on them.
Describe the consequence to the Federal program or policy activities if the collection is not conducted or is conducted less frequently, as well as any technical or legal obstacles to reducing burden.
If this information were not collected, ODA could not process any loan requests because there would be no basis upon which to make eligibility or credit decisions. Since this information is only collected once, it cannot be collected less frequently.
Explain any special circumstances that would cause an information collection to be conducted in a manner, etc.
No special circumstances exist. No confidential information is required that is not protected to the extent permitted by law including the Privacy Act and Freedom of Information Act.
If applicable, provide a copy and identify the date and page number of publication in the Federal Register of the agency's notice, required by 5 CFR 1320.8(d), soliciting comments on the information collection prior to submission to OMB. Summarize public comments received. Describe efforts to consult with persons outside the agency to obtain their views.
Comments were solicited in a Federal Register notice published July 27, 2017 in Vol 82 FR 35021, copy attached. The comment period closed on September 25, 2017 and no comments were received.
Explain any decision to provide any payment or gift to respondents, other than remuneration of contractors or grantees.
There are no payments made or gifts given to respondents.
Describe any assurance of confidentiality provided to respondents and the basis for the assurance in statute, regulation, or agency policy.
The information collected is protected to the extent permitted by law, including the Privacy Act, 5 U.S.C. 552a and the Freedom of Information Act, 5 U.S.C. 552, and becomes a part of SBA’s System of Records (SBA 20). Notice of the rights afforded loan applicants regarding disclosure of or access to confidential information is part of the loan application.
Provide additional justification for any questions of a sensitive nature, such as sexual behavior and attitudes, religious beliefs, and other matters that are commonly considered private. This justification should include the reasons why the agency considers the questions necessary, specific uses to be made of the information, explanation to be given to persons from whom the information is requested, and any steps to be taken to obtain their consent.
Questions of a “sensitive” nature are solicited in this collection. This information is asked so that ODA can make an informed credit and eligibility determination.
SBA requests information such as birth date and financial and criminal records information. This information is required in order for an applicant to receive a benefit under SBA’s Disaster Loan Program. This information helps SBA to assess whether there is a reasonable assurance of loan repayment.
This collection also requests taxpayer identification numbers, including Social Security numbers. The Debt Collection Improvement Act requires any agency administering a Federal loan program (such as SBA’s disaster assistance program) to require persons applying for a loan to provide their taxpayer identifying number 31 U.S.C. 7701(b). The primary reason is to enable the agency to collect and report on any delinquent loan amounts. In general, Social Security numbers enable SBA to distinguish between people with the same or similar name and to conduct investigations, as necessary, to determine whether a potential recipient of SBA assistance is engaged in or has engaged in any practices that violate the Small Business Act.
Provide estimates of the hour burden of the collection of information, well as the hour cost burden. Indicate the number of respondents, frequency of response, annual hour and cost burden, and an explanation of how the burden was estimated.
Estimates are broken down by specific loan program and are based on an average of loan applications accepted during the last five fiscal years; however, the high and low activity years (FY 13 & FY 14, respectively) have been excluded to arrive at an average three-year period.
The computation is below:
For Physical Business and EIDL loan program:
Fiscal Year Business/EIDL Loan Applications Accepted
15 1,225
16 3,347
17 4,322
Total: 8,894
8,894 divided by 3 = 2,965 average loan applications accepted (number of respondents).
For MREIDL program:
Fiscal Year MREIDL Loan Applications Accepted
15 2
16 5
17 8
Total: 15
15 divided by 3 = 5 average loan applications accepted (number of respondents). For FY17, approximately 93% of all applications were accepted using the ELA.
TOTAL RESPONDENTS (for both programs) = 2,965 + 5 = 2,970
PUBLIC BURDEN-Hours
The SBA Form 5 (regardless of format) is filled out by 100 percent of disaster business loan applicants and takes an estimated 2 hours to complete.
2,970 respondents x 2 = 5,940 public burden hours for both programs.
The SBA Form 1368 is completed by 33% of applicants who complete the SBA Form 5. Additionally, the SBA Form 1368 is filled out by applicants for the MREIDL program.
33% of 2,970 respondents for Business/EIDL loans = 980
5 respondents for MREIDL loans = 5
980 + 5 = 985 hours for SBA Form 1368
5,940 + 985 = 6,925 TOTAL PUBLIC BURDEN HOURS
PUBLIC BURDEN-Cost
The cost estimate for a respondent is based on GS 9, step 1 ($24.24 per hour-RUS), which is the level of expertise (minimal) that is required to respond. The annual hourly cost estimate is calculated below:
SBA Form 5 (paper and ELA): 5,940 burden hours x $24.24 + 20 percent overhead for printing, etc. = $172,783
SBA 1368: 985 burden hours x $24.24 + 20 percent overhead = $28,652
$172,783 + $28,652 = $201,435 TOTAL COST TO RESPONDENT
Provide an estimate for the total annual cost burden to respondents or record keepers resulting from the collection of information. Do not include hour cost burden from above.
No additional annual costs beyond those identified in #12 above are anticipated.
Provide estimates of annualized costs to the Federal Government. Also provide a description of the method used to estimate cost, including a quantification of hours, operational expenses (such as equipment, overhead, printing, and support staff), and any other expense that would not have been incurred without this collection of information.
AGENCY BURDEN
2,970 respondents at approximately 5 hours on average for direct processing (which takes into consideration both economic injury applications that may require more processing time as well as simple business applications that require less processing time). Agency burden hours are as follows:
2,970 respondents x 5 hours per application = 14,850 Agency Burden hours.
The annual cost estimate for the Agency is based on a GS 11, Step 1 at $29.33 per hour-RUS (typical expertise required for processing applications) and is calculated as follows:
14,850 hours x $29.33 per hour = $435,551 plus 30 percent for printing
supplies, leased equipment, etc. = $566,216 cost to Agency.
15. Explain reasons for any program changes or adjustments reported in Items 13 or 14 of the OMB Form 83-I.
Burden and cost information decreased with this submission as compared to the last submission due to the fact that there was a decrease in the number of applications accepted and sole proprietor applicants no longer use this form (they now use the SBA Form SBA Form 5C, Disaster Home/Sole Proprietor Loan Application).
For collection of information whose results will be published, outline plans for tabulation and pubication. Address complex analytical techniques. Provide time schedules for the entire project.
Published SBA disaster loan data includes verified loss and approved loan amount totals for both home and business disaster loans, segmented by city, county, zip code and state. The information is published quarterly on the SBA.gov website.
If seeking approval to not display the expiration date for OMB approval of the information collection, explain the reasons why the display would be inappropriate.
SBA will display the expiration date of OMB approval.
Explain each exception to the certiifcation statement identified in Item 19, “Certfication for Paperwork Reduction Act Submission,” of OMB Form 83-I.
There are no exceptions to the certification statement.
Describe (including a numerical estimate) the potential respondent universe and any sampling or other respondent selection method to be used.
Not Applicable
| File Type | application/vnd.openxmlformats-officedocument.wordprocessingml.document |
| File Title | Supporting Statement |
| Author | Cindy Pitts |
| File Modified | 0000-00-00 |
| File Created | 2021-01-21 |