§12185 Limitations on use of funds

Summary

No more than 50 percent of an organization’s total investment under this subpart can come from a line of credit. Up to 10 percent of the line can be used for training, technical help, or for planning, developing, and managing economic development projects. Community development corporations are encouraged to get help from other experienced CDCs, and the Secretary must help find and arrange that help. To draw from the line, an organization must follow the Secretary’s procedures and show the CDC it will provide local and private contributions as required by section 12182(b)(2)(D), join the CDC in a loan, guarantee, or investment for a designated business, and commit at least the same amount it plans to draw. Any returns from these investments may only be used for the purposes listed in section 12181 and must be reinvested in the community where they came from.