§9812 — Title 42 The Public Health and Welfare | U.S. Code

Summary

The Secretary can make or guarantee loans to help build businesses and community projects. Eligible borrowers include community development groups, families, local cooperatives and their designated support organizations, nonprofits (including those helped under chapter 106), and public or nonprofit agencies. The Secretary must only approve a loan if there is a reasonable chance it will be paid back, the loan cannot be gotten on fair terms elsewhere, and the loan plus other money will be enough to finish the project. The Secretary can change interest rates, delay payments, collect or settle debts, and take other needed actions. A Development Loan Fund is created with two revolving accounts: the Rural Development Loan Fund and the Community Development Loan Fund. The rural fund includes leftover money from part A of title III of the Economic Opportunity Act of 1964 as of September 19, 1972, and other deposits. The community fund gets deposits from appropriations, and the Secretary may add money to it in any year when at least $60,000,000 in grants to community development corporations has been made from those appropriations.

Title 42, §9812

The Public Health and Welfare — Source: USLM XML via OLRC

(a)The Secretary is authorized to make or guarantee loans (either directly or in cooperation with banks or other organizations through agreements to participate on an immediate or deferred basis) to community development corporations, to families and local cooperatives and the designated supportive organizations of cooperatives eligible for financial assistance under this subchapter, to private nonprofit organizations receiving assistance under chapter 106 of this title, or to public and private nonprofit organizations or agencies, for business facilities and community development projects, including community development credit unions, which the Secretary determines will carry out the purposes of this part. No loans, guarantees, or other financial assistance shall be provided under this section unless the Secretary determines that—

(1)there is reasonable assurance of repayment of the loan;

(2)the loan is not otherwise available on reasonable terms from private sources or other Federal, State, or local programs; and

(3)the amount of the loan, together with other funds available, is adequate to assure completion of the project or achievement of the purposes for which the loan is made.

(b)The Secretary is authorized to adjust interest rates, grant moratoriums on repayment of principal and interest, collect or compromise any obligations held by the Secretary, and to take such other actions in respect to such loans as the Secretary shall determine to be necessary or appropriate, consistent with the purposes of this section.

(c)(1)To carry out the lending and guaranty functions authorized under this part, there shall be established a Development Loan Fund consisting of two separate accounts, one of which shall be a revolving fund called the Rural Development Loan Fund and the other of which shall be a revolving fund called the Community Development Loan Fund. The capital of each such revolving fund shall remain available until expended.

(2)The Rural Development Loan Fund shall consist of the remaining funds provided for in part A of title III of the Economic Opportunity Act of 1964 [42 U.S.C. 2841 et seq.], as in effect on September 19, 1972, and such amounts as may be deposited in such fund by the Secretary out of funds made available from appropriations for purposes of carrying out this part. The Secretary shall utilize the services of the Farmers Home Administration,11 So in original. The comma probably should not appear. or the Rural Development Administration in administering such fund.

(3)The Community Development Loan Fund shall consist of such amounts as may be deposited in such fund by the Secretary out of funds made available from appropriations for purposes of carrying out this subchapter. The Secretary may make deposits in the Community Development Loan Fund in any fiscal year in which the Secretary has made available for grants to community development corporations under this subchapter not less than $60,000,000 out of funds made available from appropriations for purposes of carrying out this subchapter.

Notes & Related Subsidiaries

Editorial Notes

References in Text

Chapter 106 of this title, referred to in subsec. (a), was in the original “subtitle B of this title”, meaning subtitle B (§ 671 et seq.) of title VI of Pub. L. 97–35, Aug. 13, 1981, 95 Stat. 511, known as the Community Services Block Grant Act, which is classified generally to chapter 106 (§ 9901 et seq.) of this title. For complete classification of this Act to the Code, see

Short Title

note set out under section 9901 of this title and Tables. The Economic Opportunity Act of 1964, referred to in subsec. (c)(2), is Pub. L. 88–452, Aug. 20, 1964, 78 Stat. 508. Part A of title III of the Economic Opportunity Act of 1964 was classified generally to part A (§ 2841 et seq.) of subchapter III of chapter 34 of this title prior to repeal by Pub. L. 97–35, title VI, § 683(a), Aug. 13, 1981, 95 Stat. 519. For complete classification of this Act to the Code, see Tables.

Amendments

1990—Subsec. (c)(2). Pub. L. 101–624 inserted “, or the Rural Development Administration” after “Farmers Home Administration”.

Statutory Notes and Related Subsidiaries

Transfer of Functions

Functions relating to administration of Community Development Credit Union Revolving Loan Fund transferred from Secretary of Health and Human Services to National Credit Union Administration Board by Pub. L. 99–609, set out as a note under section 9822 of this title.

§9812 Development loan fund