Title 43 — Public LandsRelease 119-73not60

§2423 Loan Guarantees

Title 43 › Chapter 42— RURAL WATER SUPPLY › Subchapter II— TWENTY-FIRST CENTURY WATER WORKS › § 2423

Last updated Apr 5, 2026|Official source

Summary

If money is provided by Congress, the Secretary may promise lenders that the government will back loans for projects that meet the rules in section 2422. These guarantees are meant to add to private or lender financing for the project. Guarantees must include terms the Secretary thinks protect U.S. money. A guarantee cannot cover more than 90% of the project's estimated cost when issued. Interest rates must be set by the Secretary, taking into account similar private loans and risks. The loan must be fully paid off within 40 years and cannot be junior to other financing. Any prepayment or refinancing must be agreed to by the non-Federal borrower and the lender and approved by the Secretary.

Full Legal Text

Title 43, §2423

Public Lands — Source: USLM XML via OLRC

(a)Subject to the availability of appropriations, the Secretary may make available to lenders for a project meeting the eligibility criteria established in section 2422 of this title loan guarantees to supplement private-sector or lender financing for the project.

(b)(1)Loan guarantees under this section for a project shall be on such terms and conditions and contain such covenants, representations, warranties, and requirements as the Secretary determines to be appropriate to protect the financial interests of the United States.

(2)Loan guarantees by the Secretary shall not exceed an amount equal to 90 percent of the cost of the project that is the subject of the loan guarantee, as estimated at the time at which the loan guarantee is issued.

(3)An obligation shall bear interest at a rate that does not exceed a level that the Secretary determines to be appropriate, taking into account the prevailing rate of interest in the private sector for similar loans and risks.

(4)A loan guarantee under this section shall provide for complete amortization of the loan guarantee within not more than 40 years.

(5)An obligation shall be subject to the condition that the obligation is not subordinate to other financing.

(c)Any prepayment or refinancing terms on a loan guarantee shall be negotiated between the non-Federal borrower and the lender with the consent of the Secretary.

Reference

Citations & Metadata

Citation

43 U.S.C. § 2423

Title 43 — Public Lands

Last Updated

Apr 5, 2026

Release point: 119-73not60