15 U.S.C. § 2509 — Loan guarantees

Page 1843 TITLE 15—COMMERCE AND TRADE § 2509 AMENDMENTS 1978—Subsecs. (d), (e). Pub. L. 95–238 added subsecs. (d) and (e). Statutory Notes and Related Subsidiaries TRANSFER OF FUNCTIONS ‘‘Secretary of Energy’’ substituted for ‘‘Adminis- trator’’ in subsecs. (a) to (c) and the first time it ap- pears in subsec. (e) pursuant to section 301(a) of Pub. L. 95–91, see Codification note set out under section 2502 of this title. § 2508. Encouragement and protection of small business (a) Opportunity to participate The Secretary of Energy shall take such steps as are feasible to assure that small business con- cerns have a realistic and adequate opportunity to participate in the project. (b) Reservation of funds To assist in accomplishing the objectives of subsection (a), the Secretary of Energy shall re- serve, for contracts with small business con- cerns, a reasonable portion of the funds made available pursuant to this chapter for research, development, or demonstration of electric or hy- brid vehicles. (c) Contract terms and conditions; planning grants The Secretary of Energy shall, in addition to the requirements set forth in subsections (a) and (b)— (1) include in all contracts for research, de- velopment, or demonstration of electric or hy- brid vehicles such terms, conditions, and pay- ment schedules as may assist in meeting the needs of small business concerns, and shall take steps to avoid the inclusion in such con- tracts of any terms, conditions, or penalties which would tend to prevent such concerns from participating in the program under this chapter; and (2) make planning grants available to quali- fied small business concerns which require as- sistance in developing, submitting, and enter- ing into such contracts. (Pub. L. 94–413, § 9, Sept. 17, 1976, 90 Stat. 1266; Pub. L. 95–91, title III, § 301(a), Aug. 4, 1977, 91 Stat. 577.) Statutory Notes and Related Subsidiaries TRANSFER OF FUNCTIONS ‘‘Secretary of Energy’’ substituted in text for ‘‘Ad- ministrator’’ pursuant to section 301(a) of Pub. L. 95–91, see Codification note set out under section 2502 of this title. § 2509. Loan guarantees (a) Congressional policy It is the policy of the Congress to assist in the introduction into the Nation’s transportation fleet of electric and hybrid vehicles and to as- sure that qualified small business concerns and other qualified borrowers are not excluded from participation in such development due to lack of adequate capital. Accordingly, it is the policy of the Congress to provide guarantees of loans made for such purposes. (b) Encouragement of commercial production; purpose of loans In order to encourage the commercial produc- tion of electric and hybrid vehicles, the Sec- retary of Energy is authorized to guarantee, and to enter into commitments to guarantee, prin- cipal and interest on loans made by lenders to qualified borrowers, primarily small business concerns, for the purposes of— (1) research and development related to elec- tric and hybrid vehicle technology; (2) prototype development for such vehicles and parts thereof; (3) construction of capital equipment related to research on, and development and produc- tion of, electric and hybrid vehicles and com- ponents; or (4) initial operating expenses associated with the development and production of electric and hybrid vehicles and components. (c) Maximum amount of loan guarantee Any guarantee under this section shall apply only to so much of the principal amount of the loan involved as does not exceed 90 percentum of the aggregate cost of the activity with respect to which the loan is made. (d) Terms and conditions of guarantee Loan guarantees under this section shall be on such terms and conditions as the Secretary of Energy determines, except that a guarantee shall be made under this section only if— (1) the loan bears interest at a rate not to exceed such annual percent on the principal obligation outstanding as the Secretary of En- ergy determines to be reasonable, taking into account the range of interest rates prevailing in the private sector for similar loans and risks by the United States; (2) the terms of such loan require full repay- ment over a period not to exceed 15 years; (3) in the judgment of the Secretary of En- ergy, the amount of the loan (when combined with amounts available to the qualified bor- rower from other sources) will be sufficient to carry out the activity with respect to which the loan is made; (4) in the judgment of the Secretary of En- ergy, there is reasonable assurance of repay- ment of the loan by the qualified borrower; and (5) no loan shall be guaranteed by the Sec- retary of Energy under subsection (b) unless the Secretary of Energy finds that no other reasonable means of financing or refinancing is reasonably available to the applicant. (e) Maximum guarantee per loan; maximum of aggregate guarantees; Electric and Hybrid Vehicle Development Fund; establishment, funding, etc. (1) The amount of the guarantee of any loan shall not exceed $3,000,000, unless the Secretary of Energy finds that a higher guarantee level for specific loan guarantees is necessary in order to carry out the purposes of this chapter. If the Secretary of Energy makes such finding, he shall immediately report that finding to the Speaker of the House of Representatives, the President of the Senate, the Committee on Science, Space, and Technology of the House of Page 1844 TITLE 15—COMMERCE AND TRADE § 2509 Representatives, and the Committee on Com- merce, Science, and Transportation of the Sen- ate. (2) The aggregate amount of guarantees out- standing under this section at any one time shall not exceed $60,000,000. (3)(A) There is established in the Treasury of the United States an Electric and Hybrid Vehi- cle Development Fund (hereinafter in this para- graph referred to as the ‘‘fund’’), which shall be available to the Secretary of Energy for car- rying out the loan guarantee and principal and interest assistance program authorized by this chapter, including the payment of administra- tive expenses incurred in connection therewith. Moneys in the fund not needed for current oper- ations may, with the approval of the Secretary of the Treasury, be invested in bonds or other obligations of, or guaranteed by, the United States. (B) There shall be paid into the fund such part of the amounts appropriated pursuant to section 2514 of this title as the Secretary of Energy deems necessary to carry out the purposes of this chapter and such amounts as may be re- turned to the United States pursuant to sub- section (g) of this section, and the amounts in the fund shall remain available until expended, except that after the expiration of the 7-year pe- riod established by subsection (h) of this section such amounts in the fund as are not required to secure outstanding guarantee obligations shall be paid into the general fund of the Treasury. (C) If at any time the moneys available in the fund are insufficient to enable the Secretary of Energy to discharge his responsibilities under this section, he shall issue to the Secretary of the Treasury notes or other obligations in such forms and denominations, bearing such matu- rities, and subject to such terms and conditions as may be prescribed by the Secretary of the Treasury. This borrowing authority shall be ef- fective only to such extent or in such amounts as are specified in appropriation Acts. Such au- thority shall be without fiscal year limitation. Redemption of such notes or obligations shall be made by the Secretary of Energy from appro- priations or other moneys available under this chapter. Such notes or other obligations shall bear interest at a rate determined by the Sec- retary of the Treasury, which shall not be less than a rate determined by taking into consider- ation the average market yield on outstanding marketable obligations of the United States of comparable maturities during the month pre- ceding the issuance of the notes or other obliga- tions. The Secretary of the Treasury shall pur- chase any notes or other obligations issued here- under and for that purpose he is authorized to use as a public debt transaction the proceeds from the sale of any securities issued under chapter 31 of title 31, and the purposes for which securities may be issued under that chapter are extended to include any purchase of such notes or obligations. The Secretary of the Treasury may at any time sell any of the notes or other obligations acquired by him under this sub- section. All redemptions, purchases, and sales by the Secretary of the Treasury of such notes or other obligations shall be treated as public debt transactions of the United States. (D) Business-type financial reports covering the operations of the fund shall be submitted to the Congress by the Secretary of Energy annu- ally upon the completion of the appropriate ac- counting period. (f) Qualified borrower As used in this section, the term ‘‘qualified borrower’’ means any partnership, corporation, or other legal entity which (as determined by the Secretary of Energy) has presented satisfac- tory evidence of an interest in electric or hybrid vehicle technology and is capable of performing research or completing the development and production of electric or hybrid vehicles or any components thereof in an acceptable manner. (g) Payment of principal and interest; default; re- covery of losses (1) With respect to any loan guaranteed pursu- ant to this section, the Secretary of Energy is authorized to enter into a contract to pay, and to pay, the lender for and on behalf of the bor- rower the principal and interest charges which become due and payable on the unpaid balance of such loan if the Secretary of Energy finds— (A) that the borrower is unable to meet prin- cipal and interest charges, that it is in the public interest to permit the borrower to con- tinue to pursue the purposes of the project, and that the probable net cost to the Federal Government in paying such principal will be less than that which would result in the event of a default; and (B) that the amount of such principal and in- terest charges which the Secretary of Energy is authorized to pay shall be no greater than the amount of principal and interest which the borrower is obligated to pay under the loan agreement. (2) In the event of any default by a qualified borrower on a guaranteed loan, the Secretary of Energy is authorized to make payment in ac- cordance with the guarantee, and the Attorney General shall take such action as may be appro- priate to recover the amounts of such payments (including any payment of principal and interest under paragraph (1)) from such assets of the de- faulting borrower as are associated with the ac- tivity with respect to which the loan was made or from any other surety included in the terms of the guarantee. (h) Seven year limitation No loan guarantee shall be made, or interest assistance contracts entered into, pursuant to this section, after the expiration of the 7-year period following September 17, 1976. (i) Citizenship of applicant; corporations; waiver An applicant seeking a guarantee under this section must be a citizen or national of the United States. A corporation, partnership, firm, or association shall not be deemed to be a cit- izen or national of the United States unless the Secretary of Energy determines that it satisfac- torily meets all the requirements of section 50501 of title 46, for determining such citizen- ship, except that the provisions in subsections (a) and (b) of such section 50501 concerning (1) the citizenship of officers or directors of a cor- poration, and (2) the interest required to be Page 1845 TITLE 15—COMMERCE AND TRADE § 2512 1 See References in Text note below. owned in the case of a corporation, association, or partnership operating a vessel in the coast- wise trade, shall not be applicable. The Sec- retary of Energy, in consultation with the Sec- retary of State, may waive such requirements in the case of a corporation, partnership, firm, or association, controlling interest in which is owned by citizens of countries which are partici- pants in the International Energy Agreement. (j) Pledge of full faith and credit of United States The full faith and credit of the United States is pledged to the payment of all obligations in- curred under this section. (Pub. L. 94–413, § 10, Sept. 17, 1976, 90 Stat. 1267; Pub. L. 95–91, title III, § 301(a), Aug. 4, 1977, 91 Stat. 577; Pub. L. 95–238, title VI, § 603, Feb. 25, 1978, 92 Stat. 93; Pub. L. 103–437, § 5(d)(2), Nov. 2, 1994, 108 Stat. 4582.) Editorial Notes CODIFICATION In subsec. (e)(3)(C), ‘‘chapter 31 of title 31’’ and ‘‘that chapter’’ substituted for ‘‘the Second Liberty Bond Act, as amended’’ and ‘‘that Act’’, respectively, on au- thority of Pub. L. 97–258, § 4(b), Sept. 13, 1982, 96 Stat. 1067, the first section of which enacted Title 31, Money and Finance. In subsec. (i), ‘‘section 50501 of title 46’’ substituted for ‘‘section 2 of the Shipping Act of 1916 (46 U.S.C. 802)’’ and ‘‘subsections (a) and (b) of such section 50501’’ substituted for ‘‘subsection (a) of such section 2’’ on au- thority of Pub. L. 109–304, § 18(c), Oct. 6, 2006, 120 Stat. 1709, section 8(b) of which enacted parts A and B of sub- title V of Title 46, Shipping. AMENDMENTS 1994—Subsec. (e)(1). Pub. L. 103–437 substituted ‘‘Com- mittee on Science, Space, and Technology’’ for ‘‘Com- mittee on Science and Technology’’ and ‘‘Committee on Commerce, Science, and Transportation’’ for ‘‘Com- mittee on Commerce’’. 1978—Subsec. (e)(3). Pub. L. 95–238, § 603(a)(1), added par. (3). Subsec. (g). Pub. L. 95–238, § 603(b), inserted provisions relating to payment of principal by the Administrator. Subsec. (h). Pub. L. 95–238, § 603(c), substituted ‘‘7’’ for ‘‘5’’. Subsec. (j). Pub. L. 95–238, § 603(a)(2), added subsec. (j). Statutory Notes and Related Subsidiaries TRANSFER OF FUNCTIONS ‘‘Secretary of Energy’’ substituted for ‘‘Adminis- trator’’ in subsecs. (b), (d), (e)(1), (f), and (i) pursuant to section 301(a) of Pub. L. 95–91, see Codification note set out under section 2502 of this title. § 2510. Use of electric and hybrid vehicles by Federal agencies The Postmaster General of the United States Postal Service, the Administrator of the Gen- eral Services Administration, the Secretary of Defense, and the heads of other Federal agencies shall— (1) carry out a study of the practicability of using electric and hybrid vehicles in the per- formance of some or all of the functions of their agencies; and (2) arrange for the introduction of electric and hybrid vehicles into their fleets as soon as possible. For competitive procurement purposes in pur- chasing such vehicles, life-cycle costing and any beneficial air pollution control characteristics of electric and hybrid vehicles shall be fully taken into account. If the head of the agency in- volved determines that electric or hybrid vehi- cles are technologically practicable, but that they are not completely economically competi- tive with conventional vehicles, the Secretary of Energy may, for purposes of the demonstration program described in section 2506 of this title, pay to such agency the incremental costs of the electric or hybrid vehicles, including differential operating costs. (Pub. L. 94–413, § 11, Sept. 17, 1976, 90 Stat. 1268; Pub. L. 95–91, title III, § 301(a), Aug. 4, 1977, 91 Stat. 577.) Statutory Notes and Related Subsidiaries TRANSFER OF FUNCTIONS ‘‘Secretary of Energy’’ substituted in text for ‘‘Ad- ministrator’’ pursuant to section 301(a) of Pub. L. 95–91, see Codification note set out under section 2502 of this title. § 2511. Patents Section 5908 of title 42 shall apply to any con- tract (including any assignment, substitution of parties, or subcontract thereunder), entered into, made, or issued by the Secretary of Energy pursuant to section 2507 of this title. (Pub. L. 94–413, § 12, Sept. 17, 1976, 90 Stat. 1269; Pub. L. 95–91, title III, § 301(a), Aug. 4, 1977, 91 Stat. 577.) Statutory Notes and Related Subsidiaries TRANSFER OF FUNCTIONS ‘‘Secretary of Energy’’ substituted in text for ‘‘Ad- ministrator’’ pursuant to section 301(a) of Pub. L. 95–91, see Codification note set out under section 2502 of this title. § 2512. Studies (a) Bias of surface transportation systems; sub- mission of report The Secretary of Energy shall conduct a study to determine the existence of any tax, regu- latory, traffic, urban design, rural electrical, or other institutional factor which tends or may tend to bias surface transportation systems to- ward vehicles of particular characteristics. The Secretary of Energy shall submit a report to the Congress on the findings and conclusions of such study, within 1 year after September 17, 1976. The report shall include any legislative or other recommendations of the Secretary of Energy. (b) Material demand and pollution effect; impact statement The Secretary of Energy shall conduct a con- tinuing assessment of the long-range material demand and pollution effects which may result from or in connection with the electrification of urban traffic. Such assessment shall include a statement of the Secretary of Energy’s current findings in each report submitted under section 2513 1 of this title. Any environmental impact statement which may be filed under a Federal