7 U.S.C. § 2009g — Guarantee and commitment to guarantee

Page 1194 TITLE 7—AGRICULTURE § 2009g (g) Expenditure of funds by State (1) In general Payments to a State from a grant under this section for a fiscal year shall be obligated by the State in the fiscal year or in the suc- ceeding fiscal year. A State shall obligate funds under this section to provide assistance to rural areas. (2) Failure to obligate If a State fails to obligate payments in ac- cordance with paragraph (1), the Secretary shall make an equal reduction in the amount of payments provided to the State under this section for the immediately succeeding fiscal year. (3) Noncompliance (A) Review The Secretary shall review and monitor State compliance with this section. (B) Penalty If the Secretary finds that there has been misuse of grant funds provided under this section, or noncompliance with any of the terms and conditions of a grant, after rea- sonable notice and opportunity for a hear- ing— (i) the Secretary shall notify the State of the finding; and (ii) no further payments to the State shall be made with respect to the programs funded under this section until the Sec- retary is satisfied that there is no longer any failure to comply or that the non- compliance will be promptly corrected. (C) Other sanctions In the case of a finding of noncompliance made pursuant to subparagraph (B), the Sec- retary may, in addition to, or in lieu of, im- posing the sanctions described in subpara- graph (B), impose other appropriate sanc- tions, including recoupment of money im- properly expended for purposes prohibited or not authorized by this section and disquali- fication from the receipt of financial assist- ance under this section. (h) No entitlement to contract, grant, or assist- ance Nothing in this subchapter— (1) entitles any person to assistance or a contract or grant; or (2) limits the right of a State to impose addi- tional limitations or conditions on assistance or a contract or grant under this section. (Pub. L. 87–128, title III, § 381G, as added Pub. L. 104–127, title VII, § 761, Apr. 4, 1996, 110 Stat. 1143; amended Pub. L. 107–171, title VI, § 6026(c), May 13, 2002, 116 Stat. 372.) Editorial Notes AMENDMENTS 2002—Subsec. (a)(1), (2). Pub. L. 107–171, § 6026(c)(1), substituted ‘‘section 2009d(f) of this title’’ for ‘‘section 2009d(g) of this title’’. Subsec. (b)(1). Pub. L. 107–171, § 6026(c)(2), substituted ‘‘section 2009d(g) of this title’’ for ‘‘section 2009d(h) of this title’’. § 2009g. Guarantee and commitment to guarantee loans (a) ‘‘Eligible public entity’’ defined In this section, the term ‘‘eligible public enti- ty’’ means any unit of general local government. (b) Guarantee and commitment The Secretary, on such terms and conditions as the Secretary may prescribe, may guarantee and make commitments to guarantee notes or other obligations issued by eligible public enti- ties, or by public agencies designated by the eli- gible public entities, for the purposes of financ- ing rural development activities authorized and funded under section 2009f of this title. (c) Limitation The Secretary may not make a guarantee or commitment to guarantee with respect to a note or other obligation if the total amount of out- standing notes or obligations guaranteed under this section (excluding any amount repaid under the contract entered into under subsection (e)(1)(A)) for issuers in the State would exceed an amount equal to 5 times the sum of the total amount of grants made to the State under sec- tion 2009f of this title. (d) Payment of principal, interest, and costs Notwithstanding any other provision of this subchapter, a State to which a grant is made under section 2009f of this title may use the grant (including program income derived from the grant) to pay principal and interest due (in- cluding such servicing, underwriting, or other costs as may be specified in regulations of the Secretary) on any note or other obligation guar- anteed under this section. (e) Repayment contract; security (1) In general To ensure the repayment of notes or other obligations and charges incurred under this section and as a condition for receiving the guarantees, the Secretary shall require the issuer to— (A) enter into a contract, in a form accept- able to the Secretary, for repayment of notes or other obligations guaranteed under this section; (B) pledge any grant for which the issuer may become eligible under this subchapter; and (C) furnish, at the discretion of the Sec- retary, such other security as may be con- sidered appropriate by the Secretary in making the guarantees. (2) Security To assist in ensuring the repayment of notes or other obligations and charges incurred under this section, a State shall pledge any grant for which the State may become eligible under this subchapter as security for notes or other obligations and charges issued under this section by any eligible public entity in the State. (f) Pledged grants for repayments Notwithstanding any other provision of this subchapter, the Secretary may apply grants pledged pursuant to paragraphs (1)(B) and (2) of Page 1195 TITLE 7—AGRICULTURE § 2009aa subsection (e) to any repayments due the United States as a result of the guarantees. (g) Outstanding obligations The total amount of outstanding obligations guaranteed on a cumulative basis by the Sec- retary pursuant to subsection (b) shall not at any time exceed such amount as may be author- ized to be appropriated for such purpose for any fiscal year. (h) Purchase of guaranteed obligations by Fed- eral Financing Bank Notes or other obligations guaranteed under this section may not be purchased by the Fed- eral Financing Bank. (i) Full faith and credit The full faith and credit of the United States is pledged to the payment of all guarantees made under this section. Any such guarantee made by the Secretary shall be conclusive evi- dence of the eligibility of the obligations for the guarantee with respect to principal and interest. The validity of the guarantee shall be incontest- able in the hands of a holder of the guaranteed obligations. (Pub. L. 87–128, title III, § 381H, as added Pub. L. 104–127, title VII, § 761, Apr. 4, 1996, 110 Stat. 1145.) § 2009h. Local involvement An application for assistance under this sub- chapter shall include evidence of significant community support for the project for which the assistance is requested. In the case of assistance for a community facilities or infrastructure project, the evidence shall be in the form of a certification of support for the project from each affected general purpose local government. (Pub. L. 87–128, title III, § 381I, as added Pub. L. 104–127, title VII, § 761, Apr. 4, 1996, 110 Stat. 1146.) § 2009i. Interstate collaboration The Secretary shall permit the establishment of voluntary pooling arrangements among States, and regional fund-sharing agreements, to carry out projects receiving assistance under this subchapter. (Pub. L. 87–128, title III, § 381J, as added Pub. L. 104–127, title VII, § 761, Apr. 4, 1996, 110 Stat. 1146.) § 2009j. Annual report (a) In general The Secretary, in collaboration with State, local, public, and private entities, State rural development councils, and community-based or- ganizations, shall prepare an annual report that contains evaluations, assessments, and perform- ance outcomes concerning the rural community advancement programs carried out under this subchapter. (b) Submission Not later than March 1 of each year, the Sec- retary shall— (1) submit the report required by subsection (a) to Congress and the chief executives of the States participating in the program estab- lished under this subchapter; and (2) make the report available to State and local participants. (Pub. L. 87–128, title III, § 381K, as added Pub. L. 104–127, title VII, § 761, Apr. 4, 1996, 110 Stat. 1146.) § 2009k. Rural development interagency working group (a) In general The Secretary shall provide leadership within the Executive branch for, and assume responsi- bility for, establishing an interagency working group chaired by the Secretary. (b) Duties The working group shall establish policy for, coordinate, make recommendations with respect to, and evaluate the performance of, all Federal rural development efforts. (Pub. L. 87–128, title III, § 381L, as added Pub. L. 104–127, title VII, § 761, Apr. 4, 1996, 110 Stat. 1146.) § 2009l. Duties of Rural Economic and Commu- nity Development State Offices In carrying out this subchapter, the Director of a Rural Economic and Community Develop- ment State Office shall— (1) to the maximum extent practicable, en- sure that the State strategic plan referred to in section 2009c of this title is implemented; (2) coordinate community development ob- jectives within the State; (3) establish links between local, State, and field office program administrators of the De- partment of Agriculture; (4) ensure that recipient communities com- ply with applicable Federal and State laws and requirements; and (5) integrate State development programs with assistance under this subchapter. (Pub. L. 87–128, title III, § 381M, as added Pub. L. 104–127, title VII, § 761, Apr. 4, 1996, 110 Stat. 1146.) § 2009m. Electronic transfer The Secretary shall transfer funds in accord- ance with this subchapter through electronic transfer as soon as practicable after April 4, 1996. (Pub. L. 87–128, title III, § 381N, as added Pub. L. 104–127, title VII, § 761, Apr. 4, 1996, 110 Stat. 1147.) § 2009n. Repealed. Pub. L. 107–171, title VI, § 6026(b), May 13, 2002, 116 Stat. 372 Section, Pub. L. 87–128, title III, § 381O, as added Pub. L. 104–127, title VII, § 761, Apr. 4, 1996, 110 Stat. 1147, re- lated to rural venture capital demonstration program. SUBCHAPTER VI—DELTA REGIONAL AUTHORITY § 2009aa. Definitions In this subchapter: