[Code of Federal Regulations]
[Title 13, Volume 1]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 13CFR112.11]

[Page 143]
 
                TITLE 13--BUSINESS CREDIT AND ASSISTANCE
 
                CHAPTER I--SMALL BUSINESS ADMINISTRATION
 
PART 112--NONDISCRIMINATION IN FEDERALLY ASSISTED PROGRAMS OF SBA--EFFECTUATION OF TITLE VI OF THE CIVIL RIGHTS ACT OF 1964--Table of Contents
 
Sec. 112.11  Procedure for effecting compliance.

    (a) General. (1) If there appears to be a failure or threatened 
failure to comply with this part and if the noncompliance or threatened 
noncompliance cannot be corrected by informal means, compliance with 
this part may be effected by suspending, terminating, or refusing any 
financial assistance approved but not yet disbursed to an applicant or, 
in the case of a loan which has been partially disbursed, by refusing to 
make further disbursements. In addition, compliance may be effected by 
any other means authorized by law.
    (2) Such other means may include but are not limited to (i) legal 
action by SBA to enforce its right, embodied in the assurances described 
in Sec. 112.8, to accelerate the maturity of the recipient's obligation; 
(ii) a reference to the Department of Justice with a recommendation that 
appropriate proceedings be brought to enforce any rights of the United 
States under any law of the United States, including other titles of the 
Act; and (iii) any applicable proceedings under State or local law.
    (b) Noncompliance with Sec. 112.8. If an applicant fails or refuses 
to furnish an assurance required under Sec. 112.8 or otherwise fails or 
refuses to comply with a requirement imposed by or pursuant to that 
section Federal financial assistance may be refused in accordance with 
the procedures of paragraph (c) of this section. SBA shall not be 
required to provide assistance in such a case during the pendency of the 
administrative proceedings under such paragraph except that SBA shall 
continue assistance during the pendency of such proceedings where such 
assistance is due and payable pursuant to an application therefor 
approved prior to the effective date of this part. Such proceedings 
shall be conducted in accordance with the provisions of part 134 of this 
chapter by an Administrative Law Judge of the Office of Hearings and 
Appeals, who shall issue an initial decision in the case. The 
Administrator shall be the reviewing official for purposes of 
Sec. 134.228. The applicant's failure to file a timely motion in 
accordance with Secs. 134.222 and 134.211, requesting that the matter be 
scheduled for an oral hearing, shall constitute waiver of the right to 
an oral hearing but shall not prevent the submission of written 
information and argument for the record in accordance with the 
provisions of part 134.
    (c) Conditions precedent. No order suspending, terminating, or 
refusing financial assistance shall become effective until (1) SBA has 
advised the applicant or recipient of his failure to comply and has 
determined that compliance cannot be secured by voluntary means; (2) 
there has been an express finding on the record after an opportunity for 
an oral hearing, of a failure by the applicant or recipient to comply 
with a requirement imposed by or pursuant to this part; (3) the initial 
decision has become final pursuant to Sec. 134.227(b); and (4) the 
expiration of 30 days after SBA has filed with the committee of the 
House and the committee of the Senate having legislative jurisdiction of 
the form of financial assistance involved, a full written report of the 
circumstances and the grounds for such action.
    (d) Other means authorized by law. No action to effect compliance by 
any other means authorized by law shall be taken until (1) SBA has 
determined that compliance cannot be secured by voluntary means; (2) the 
action has been approved by the Administrator or his designee; (3) the 
applicant or recipient or other person has been notified of its failure 
to comply and of the action to be taken to effect compliance; and (4) 
the expiration of at least 10 days from the mailing of such notice to 
the applicant or recipient or other person. During this period of at 
least 10 days from the mailing of such notice to the applicant or 
recipient or other person. During this period of at least 10 days 
additional efforts shall be made to persuade the applicant or recipient 
or other person to comply with this part and to take such corrective 
action as may be appropriate.

[30 FR 298, Jan. 9, 1965, as amended at 38 FR 17934, July 5, 1973; 49 FR 
33629, Aug. 24, 1984; 61 FR 2691, Jan. 29, 1996]

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