7 U.S.C. § 934 — Authorized financial transactions; interim

Page 534 TITLE 7—AGRICULTURE § 933 (B) The Secretary shall account for the assets, liabilities, income, expenses, and equity of the fund attributable to telephone loan operations in the telephone account. (3)(A) The assets accounted for in the electric account shall be available solely for electrifica- tion loan operations under this chapter. (B) The assets accounted for in the telephone account shall be available solely for telephone loan operations under this chapter (other than under subchapter IV). (May 20, 1936, ch. 432, title III, § 302, as added Pub. L. 92–12, § 2, May 7, 1971, 85 Stat. 30; amend- ed Pub. L. 93–32, § 2, May 11, 1973, 87 Stat. 66; Pub. L. 101–624, title XXIII, § 2359, Nov. 28, 1990, 104 Stat. 4041; Pub. L. 103–354, title II, § 235(a)(13), Oct. 13, 1994, 108 Stat. 3221; Pub. L. 104–127, title VII, § 772(b)(2), Apr. 4, 1996, 110 Stat. 1149.) Editorial Notes REFERENCES IN TEXT Section 905 of this title, referred to in subsecs. (a) and (b)(1), was repealed by Pub. L. 104–127, title VII, § 774(a), Apr. 4, 1996, 110 Stat. 1150. AMENDMENTS 1996—Subsec. (b)(2). Pub. L. 104–127 struck out ‘‘pursu- ant to section 903(a) of this title’’ after ‘‘purposes’’. 1994—Subsecs. (a), (b)(2), (4), (5), (c)(1), (2). Pub. L. 103–354 substituted ‘‘Secretary’’ for ‘‘Administrator’’ wherever appearing. 1990—Subsec. (c). Pub. L. 101–624 added subsec. (c). 1973—Pub. L. 93–32 substituted provisions setting out the liabilities of the Rural Electrification and Tele- phone Revolving Fund and the allowable purposes for which fund assets shall be available, for provisions, that the monies in the rural telephone account should remain on deposit in the Treasury of the United States until disbursed. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1973 AMENDMENT Amendment by Pub. L. 93–32 effective May 11, 1973, see section 12 of Pub. L. 93–32, set out as an Effective Date note under section 930 of this title. EFFECTIVE DATE Section effective May 7, 1971, see section 7 of Pub. L. 92–12, set out as a note under section 931 of this title. § 933. Moneys in the Rural Electrification and Telephone Revolving Fund Moneys in the fund shall remain on deposit in the Treasury of the United States until dis- bursed. (May 20, 1936, ch. 432, title III, § 303, as added Pub. L. 93–32, § 2, May 11, 1973, 87 Stat. 67.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective May 11, 1973, see section 12 of Pub. L. 93–32, set out as a note under section 930 of this title. § 934. Authorized financial transactions; interim notes; purchase of obligations for resale; sale of notes and certificates; liens (a) The Secretary is authorized to make and issue interim notes to the Secretary of the Treasury for the purpose of obtaining funds nec- essary for discharging obligations of the fund and for making loans, advances and authorized expenditures out of the fund. Such notes shall be in such form and denominations and have such maturities and be subject to such terms and conditions as may be agreed upon by the Sec- retary and the Secretary of the Treasury. Such notes shall bear interest at a rate fixed by the Secretary of the Treasury, taking into consider- ation the current average market yield of out- standing marketable obligations of the United States having maturities comparable to the notes issued by the Secretary under this section. The Secretary of the Treasury is authorized and directed to purchase any notes of the Secretary issued hereunder, and, for that purpose, the Sec- retary of the Treasury 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 such securi- ties may be issued under such chapter are ex- tended to include the purchase of notes issued by the Secretary. All redemptions, purchases, and sales by the Secretary of the Treasury of such notes shall be treated as public debt trans- actions of the United States: Provided, however, That such interim notes to the Secretary of the Treasury shall not be included in the totals of the budget of the United States Government and shall be exempt from any general limitation im- posed by statute on expenditures and net lend- ing (budget outlays) of the United States. (b) The Secretary of the Treasury is author- ized and directed to purchase for resale obliga- tions insured through the fund when offered by the Secretary. Such resales shall be upon such terms and conditions as the Secretary of the Treasury shall determine. Purchases and resales by the Secretary of the Treasury hereunder shall not be included in the totals of the budget of the United States Government and shall be exempt from any general limitation imposed by statute on expenditures and not lending (budget outlays) of the United States. (c) The Secretary may, on an insured basis or otherwise, sell and assign any notes in the fund or sell certificates of beneficial ownership there- in to the Secretary of the Treasury or in the pri- vate market. Any sale by the Secretary of notes individually or in blocks shall be treated as a sale of assets for the purposes of chapter 11 of title 31, notwithstanding the fact that the Sec- retary, under an agreement with the purchaser or purchasers, holds the debt instruments evi- dencing the loans and holds or reinvests pay- ments thereon as trustee and custodian for the purchaser or purchasers of the individual note or of the certificate of beneficial ownership in a number of such notes. Security instruments taken by the Secretary in connection with any notes in the fund may constitute liens running to the United States notwithstanding the fact that such notes may be thereafter held by pur- chasers thereof. (May 20, 1936, ch. 432, title III, § 304, as added Pub. L. 93–32, § 2, May 11, 1973, 87 Stat. 67; amended Pub. L. 103–354, title II, § 235(a)(13), Oct. 13, 1994, 108 Stat. 3221.) Page 535 TITLE 7—AGRICULTURE § 935 Editorial Notes CODIFICATION In subsecs. (a) and (c), ‘‘chapter 31 of title 31’’, ‘‘such chapter’’, and ‘‘chapter 11 of title 31’’ substituted for ‘‘the Second Liberty Bond Act, as amended’’, ‘‘such Act, as amended’’, and ‘‘the Budget and Accounting Act, 1921 [31 U.S.C. 1 et seq.]’’, respectively, on author- ity of Pub. L. 97–258, § 4(b), Sept. 13, 1982, 96 Stat. 1067, the first section of which enacted Title 31, Money and Finance. AMENDMENTS 1994—Pub. L. 103–354 substituted ‘‘Secretary’’ for ‘‘Ad- ministrator’’ wherever appearing. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective May 11, 1973, see section 12 of Pub. L. 93–32, set out as a note under section 930 of this title. § 935. Insured loans; interest rates and lending levels (a) In general The Secretary is authorized to make insured loans under this subchapter and at the interest rates hereinafter provided to the full extent of the assets available in the fund, subject only to limitations as to amounts authorized for loans and advances as may be from time to time im- posed by the Congress of the United States for loans to be made in any one year, which amounts shall remain available until expended: Provided, That the Congress in the annual appro- priation Act may also authorize the transfer of any excess cash in the fund for deposit into the Treasury as miscellaneous receipts: And provided further, That any such loans and advances shall not be included in the totals of the budget of the United States Government and shall be exempt from any general limitation imposed by statute on expenditures and net lending (budget out- lays) of the United States. (b) Insured loans Loans made under this section shall be insured by the Secretary when purchased by a lender. As used in this chapter, an insured loan is one which is made, held, and serviced by the Sec- retary, and sold and insured by the Secretary hereunder; such loans shall be sold and insured by the Secretary without undue delay. (c) Insured electric loans (1) Hardship loans (A) In general The Secretary shall make insured electric loans, to the extent of qualifying applica- tions for the loans, at an interest rate of 5 percent per year to any applicant for a loan who meets each of the following require- ments: (i) The average revenue per kilowatt- hour sold by the applicant is not less than 120 percent of the average revenue per kil- owatt-hour sold by all utilities in the State in which the applicant provides serv- ice. (ii) The average residential revenue per kilowatt-hour sold by the applicant is not less than 120 percent of the average resi- dential revenue per kilowatt-hour sold by all utilities in the State in which the ap- plicant provides service. (iii) The average per capita income of the residents receiving electric service from the applicant is less than the average per capita income of the residents of the State in which the applicant provides serv- ice, or the median household income of the households receiving electric service from the applicant is less than the median household income of the households in the State. (B) Severe hardship loans In addition to hardship loans that are made under subparagraph (A), the Secretary may make an insured electric loan at an in- terest rate of 5 percent per year to an appli- cant for a loan if, in the sole discretion of the Secretary, the applicant has experienced a severe hardship. (C) Limitation Except as provided in subparagraph (D), the Secretary may not make a loan under this paragraph to an applicant for the pur- pose of furnishing or improving electric service to a consumer located in an urban area (as defined by the Bureau of the Census) if the average number of consumers per mile of line of the total electric system of the ap- plicant exceeds 17. (D) Extremely high rates In addition to hardship loans that are made under subparagraphs (A) and (B), the Secretary shall make insured electric loans, to the extent of qualifying applications for the loans, at an interest rate of 5 percent per year to any applicant for a loan whose resi- dential revenue exceeds 15.0 cents per kilo- watt-hour sold. A qualifying application from such an applicant for the purpose of furnishing or improving electric service to a consumer located outside of an urbanized area shall not be subject to the conditions or limitation of subparagraph (A) or (C). (2) Municipal rate loans (A) In general The Secretary shall make insured electric loans, to the extent of qualifying applica- tions for the loans, at the interest rate de- scribed in subparagraph (B) for the term or terms selected by the applicant pursuant to subparagraph (C). (B) Interest rate (i) In general Subject to clause (ii), the interest rate described in this subparagraph on a loan to a qualifying applicant shall be— (I) the interest rate determined by the Secretary to be equal to the current market yield on outstanding municipal obligations with remaining periods to maturity similar to the term selected by the applicant pursuant to subparagraph (C), but not greater than the rate deter- mined under section 1927(a)(3)(A) of this title that is based on the current market