SBA SOP 50 10 8.1, A.Ch5.D — Historic Properties

iv. SBA Lenders processing the loan under non-delegated procedures must include the executed SBA Form 2481 and clearance from local SBA counsel with the application for review by the SBA loan processing center. b. For SBA Loan transactions where the Borrower, Co-Borrower, and/or Operating Company intends to alter, renovate, rehabilitate, restore, and/or demolish any part of the property or site (regardless of the source of the funds to finance these modifications), the SBA Lender must request a Section 106 review by local SBA counsel.

i. In its request for a Section 106 review to local SBA counsel, the SBA Lender must provide: a) The names of the Borrower, Co-Borrower, and/or Operating Company; b) The SBA Loan Name; c) The results of its due diligence; d) A full and complete description of the planned modifications; and e) A statement regarding whether any of the planned modifications have commenced. If so, SBA Lender must instruct the Borrower, Co-Borrower, and/or Operating Company to stop work, otherwise the SBA Loan may not be approved and/or disbursed. f) If the Borrower, Co-Borrower, and/or Operating Company is under contract for the purchase of the property or site and the seller will not agree to extend the closing deadline to accommodate the Section 106 review process or other extenuating circumstances exist that would cause a hardship if the loan is not approved by SBA until after the completion of the Section 106 review process, the SBA Lender may identify these circumstances in the request. Depending upon the circumstances, SBA may exercise its discretion to issue the SBA Terms and Conditions with a Section 106 review condition consisting of the following or similar language: “Historic Property / Section 106 Review: Pursuant to section 106 of the National Historic Preservation Act and its implementing regulations, prior to the SBA Loan closing and the commencement of any renovations, modifications, or repairs to the Property, Borrower, Co-Borrower, and Operating Company (if applicable) must obtain a historic property review clearance from SBA.”

ii. Local SBA counsel will review the request and may request additional information from the SBA Lender to facilitate the review. a) If local SBA counsel determines during the review that the property or site is not listed on the NRHP and is not eligible to be listed on the NRHP because the property or site does not have any historic significance, local SBA counsel will provide a response to the SBA Lender indicating that a Section 106 review is not required. The response must be retained in the SBA Loan file and may be requested by the SBA loan processing center during application processing. b) If local SBA counsel determines during the review that the property or site is listed on the NRHP or may be eligible to be listed on the NRHP because the property or site has historic significance, and the modifications to the property or site have already commenced, local SBA counsel must perform a Section 110(k) review before proceeding with a Section 106 review under 54 U.S.C. § 306113 and 36 CFR. § 800.9(c). If the modifications to the property or site have not yet commenced, local SBA counsel is not required to perform a section 110(k) review and instead will proceed directly to the Section 106 review. c) If local SBA counsel determines during the review that the property or site is listed on the NRHP or may be eligible to be listed on the NRHP because the property or site has historic significance, local SBA counsel will perform a Section 106 review following the procedures set forth in 36 CFR § 800.4 et seq. i) Among other things, the Section 106 review will involve evaluation of the property or site under the NRHP criteria (located at 36 CFR § 60.4) and consultation with the relevant State Historic Preservation Office (SHPO) regarding the historic significance of the property or site and whether the planned modifications will adversely affect the property or site, including any associated historic district. ii) Depending upon the nature of the review, consultation with additional parties (e.g., Native American Tribes, Native Hawaiian Organizations, local governments) may be required by 36 CFR § 800.4(d)(2). iii) Pursuant to 36 CFR § 800.4(d), the SHPO has thirty (30) days to provide a response to local SBA counsel. The SHPO’s response may consist of a statement of no objection or concurrence with SBA’s determination; an objection to SBA’s determination; or a request for additional information. iv) After receiving the SHPO’s response, local SBA counsel will consult with the Associate General Counsel for Litigation or designee and advise the SBA Lender of the next steps in the review. d) If consultation with the SHPO results in a determination that the property or site does not satisfy the NRHP criteria, or that the property or site satisfies the NRHP criteria but there will not be an adverse effect, local SBA counsel will consult with the Associate General Counsel for Litigation or designee and if no other historic property concerns exist, will receive an approval indicating that the SBA Loan transaction may proceed and will issue a Section 106 review clearance to the SBA Lender. e) SBA Lenders processing the loan under their delegated authority must retain the clearance from local SBA counsel in the SBA Loan file. The clearance must be provided with any guaranty purchase request and may be reviewed by SBA when conducting lender oversight activities. f) SBA Lenders processing the loan under non-delegated procedures must include the clearance from local SBA counsel with the application for review by the SBA loan processing center. g) If consultation with the SHPO results in a determination that the property or site satisfies the NRHP criteria and there will be an adverse effect, SBA must further consult with SHPO and, depending upon the review, other parties to resolve the adverse effect. This may result in a Memorandum of Agreement between SBA and SHPO, and other parties as applicable, regarding the resolution of the adverse effect.