[Code of Federal Regulations]
[Title 13, Volume 1]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 13CFR123.202]

[Page 353]
 
                TITLE 13--BUSINESS CREDIT AND ASSISTANCE
 
                CHAPTER I--SMALL BUSINESS ADMINISTRATION
 
PART 123_DISASTER LOAN PROGRAM--Table of Contents
 
               Subpart C_Physical Disaster Business Loans
 
Sec.  123.202  How much can my business borrow with a physical disaster 

business loan?

    (a) Disaster business loans, including both physical disaster and 
economic injury loans to the same borrower, together with its 
affiliates, cannot exceed the lesser of the uncompensated physical loss 
and economic injury or $1.5 million. Physical disaster loans may include 
amounts to meet current building code requirements. If your business is 
a major source of employment, SBA may waive the $1.5 million limitation. 
A major source of employment is a business concern which has one or more 
locations in the disaster area which:
    (1) Employed 10 percent or more of the entire work force within the 
commuting area of a geographically identifiable community (no larger 
than a county), provided that the commuting area does not extend more 
than 50 miles from such community; or
    (2) Employed 5 percent of the work force in an industry within the 
disaster area and, if the concern is a non-manufacturing concern, 
employed no less than 50 employees in the disaster area, or if the 
concern is a manufacturing concern, employed no less than 150 employees 
in the disaster area; or
    (3) Employed no less than 250 employees within the disaster area.
    (b) SBA will consider waiving the $1.5 million loan limit only if:
    (1) Your damaged location or locations are out of business or in 
imminent danger of going out of business as a result of the disaster, 
and a loan in excess of $1.5 million is necessary to reopen or keep open 
the damaged locations in order to avoid substantial unemployment in the 
disaster area; and
    (2) You have used all reasonably available funds from your business, 
its affiliates and its principal owners (20% or greater ownership 
interest) and all available credit elsewhere (as described in Sec.  
123.104) to alleviate your physical damage and economic injury.
    (c) Physical disaster business borrowers may request refinancing of 
liens on both damaged real property and machinery and equipment, but for 
an amount reduced by insurance or other compensation. To do so, your 
business property must be totally destroyed or substantially damaged, 
which means:
    (1) 40 percent or more of the aggregate value (lesser of market 
value or replacement cost at the time of the disaster) of the damaged 
real property (including land) and damaged machinery and equipment; or
    (2) 50 percent or more of the aggregate value (lesser of market 
value or replacement cost at the time of the disaster) of the damaged 
real property (excluding land) and damaged machinery and equipment.
    (d) Loan funds allocated for repair or replacement of landscaping or 
recreational facilities may not exceed $5,000 unless the landscaping or 
recreational facilities fulfilled a functional need or contributed to 
the generation of business.

[61 FR 3304, Jan. 31, 1996, as amended at 63 FR 46644, Sept. 2, 1998]