13 C.F.R. § 115.31 Guarantee percentage.
Title 13 - Business Credit and Assistance
(a) Ninety percent. SBA reimburses a Prior Approval Surety for 90% of the Loss incurred and paid if: (1) The total amount of the Contract at the time of Execution of the bond is $100,000 or less; or (2) The bond was issued on behalf of a small business owned and controlled by socially and economically disadvantaged individuals or on behalf of a qualified HUBZone small business concern. (b) Eighty percent. SBA reimburses a Prior Approval Surety in an amount not to exceed 80% of the Loss incurred and paid on bonds for Contracts in excess of $100,000 which are executed on behalf of non-disadvantaged concerns. (c) Contract increase to over $100,000. If the Contract amount increases to more than $100,000 after Execution of the bond, the guarantee percentage decreases by one percentage point for each $5,000 of increase or part thereof, but it does not decrease below 80%. This provision applies only to guarantees which qualify under paragraph (a)(1) of this section. (d) Contract increase to over $2,000,000. If the Contract amount increases above the statutory limit of $2,000,000 after Execution of the bond, SBA's share of the Loss is limited to that percentage of the increased Contract amount which the statutory limit represents, multiplied by the guarantee percentage approved by SBA. For example if a Contract amount increases to $2,100,000, SBA's share of the Loss under an 80% guarantee is limited to 76.1% [2,000,000 / 2,100,000 = 95.2% × 80% = 76.1%]. (e) Contract decrease to $100,000 or less. If the Contract amount decreases to $100,000 or less after Execution of the bond, SBA's guarantee percentage increases to 90% if the Surety provides SBA with evidence supporting the decrease and any other information or documents requested. [61 FR 3271, Jan. 31, 1996, as amended at 64 FR 18324, Apr. 14, 1999; 66 FR 30804, June 8, 2001]
Title 13: Business Credit and Assistance
PART 115—SURETY BOND GUARANTEE
Subpart B—Guarantees Subject to Prior Approval
§ 115.31 Guarantee percentage.
