§421e Municipal and Industrial Water Supply Delivery and Distribution; Allocation of Loan Funds; Loan Repayment Contract Requirements; Rate of Interest

Summary

Municipal and industrial water delivery and distribution are allowed project purposes under sections 421a to 421h unless the law that approved the project says otherwise. When needed, loan money must be split between irrigation and municipal/industrial uses in a way the Secretary accepts. Loan contracts must make the borrower pay interest each year on the unpaid loan amount that is assigned to municipal and industrial uses (including interest during construction). The interest rate must be the rate in the project’s authorizing law, or if none is given, the rate the Secretary of the Treasury sets at the start of the fiscal year when the contract or contract change is signed. That rate is based on the Treasury’s average interest on its marketable public debt that is neither due nor callable for fifteen years, rounded to the nearest one-eighth of 1 percent.