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U.S. Code as of:
01/19/04
Section 5919. Loan guarantees and commitments for alternative fuel demonstration facilities
(a) Statement of purpose
It is the purpose of this section -
(1) to assure adequate Federal support to foster a
demonstration program to produce alternative fuels from coal, oil
shale, biomass, and other domestic resources;
(2) to authorize assistance, through loan guarantees under
subsection )1(! (b) and (y) of this section for construction and
startup and related costs, to demonstration facilities for the
conversion of domestic coal, oil shale, biomass, and other
domestic resources into alternative fuels; and
(3) to gather information about the technological, economic,
environmental, and social costs, benefits, and impacts of such
demonstration facilities.
(b) Issuance of obligations for alternative fuel conversion
facilities; terms and conditions; rules and regulations;
informational requirements; concurrence of Secretary of Treasury
to terms and conditions; pledge of full faith and credit of
United States; cooperative agreements for construction, etc., of
modular facilities; bidding practices
(1) Except as provided in paragraph (5) of this subsection and
subsection (y) of this section the Secretary is authorized, in
accordance with such rules and regulations as he shall prescribe
after consultation with the Secretary of the Treasury, to guarantee
and to make commitments to guarantee, in such manner and subject to
such conditions (not inconsistent with the provisions of this
chapter) as he deems appropriate, the payment of interest on, and
the principal balance of, bonds, debentures, notes, and other
obligations issued by, or on behalf of, any borrower for the
purpose of financing the construction and startup costs of
demonstration facilities for the conversion of domestic coal, oil
shale, biomass, and other domestic resources into alternative
fuels: Provided, That no loan guarantee for a full sized oil shale
facility shall be provided under this section until after
successful demonstration of a modular facility producing between
six and ten thousand barrels per day, taking into account such
considerations as water usage, environmental effects, waste
disposal, labor conditions, health and safety, and the
socioeconomic impacts on local communities: Provided further, That
no loan guarantee shall be available under this subsection for the
manufacture of component parts for demonstration facilities
eligible for assistance under this subsection.
(2) An applicant for any financial assistance under this section
shall provide information to the Secretary in such form and with
such content as the Secretary deems necessary.
(3) Prior to issuing any guarantee under this section the
Secretary shall obtain the concurrence of the Secretary of the
Treasury with respect to the timing, interest rate, and substantial
terms and conditions of such guarantee. The Secretary of the
Treasury shall insure to the maximum extent feasible that the
timing, interest rate, and substantial terms and conditions of such
guarantee will have the minimum possible impact on the capital
markets of the United States, taking into account other Federal
direct and indirect securities activities.
(4) The full faith and credit of the United States is pledged to
the payment of all guarantees issued under this section with
respect to principal and interest.
(5)(A) The Secretary is authorized, in the case of a facility for
the conversion of oil shale to alternative fuels which is
determined by the Secretary pursuant to the proviso in paragraph
(1) of this subsection, to be constructed at a modular size, to
enter into a cooperative agreement with the applicant in accordance
with section 5907 of this title and the other provisions of this
chapter to share the estimated total design and construction costs,
plus operation and maintenance costs, of such modular facility. The
Federal share shall not exceed 75 per centum of such costs. All
receipts for the sale of any products produced during the operation
of the facility shall be used to offset the costs incurred in the
operation and maintenance of the facility. The provisions of
subsections (d), (e), (k), (m), (p), (s), (t), (u), (v), (w), and
(x) of this section shall apply to any such modular facility. The
provisions of this section shall apply to any loan guarantee for
such modular facility.
(B) After successful demonstration of the modular facility, as
determined by the Secretary, the facility is eligible for financial
assistance under this section for purposes of expansion to a full
sized facility and the applicant may purchase the Federal interest
in the modular facility as represented by the Federal share thereof
by means of (i) a cash payment to the United States, or (ii) a
share of the product or sales resulting from such expanded
operation, as determined by the Secretary. If expansion of such
facility is determined not to be warranted by the Secretary, he
may, at the option of the applicant, dispose of the modular
facility to the applicant at not less than fair market value, as
determined by the Secretary as of the date of the disposal, or
otherwise dispose of it, in accordance with applicable provisions
of law, and distribute the net proceeds thereof, after expenses of
such disposal, to the applicant in proportion to the applicant's
share of the costs of such facility.
(6) To the extent possible, loan guarantees shall be issued on
the basis of competitive bidding among guarantee applicants in a
particular technology area.
(c) Prerequisites
The Secretary, with due regard for the need for competition,
shall guarantee or make a commitment to guarantee any obligation
under subsection (b) or (y) of this section only if -
(1) the Secretary is satisfied that the financial assistance
applied for is necessary to encourage financial participation;
(2) the amount guaranteed to any borrower at any time does not
exceed -
(A) an amount equal to 75 per centum of the project cost of
the demonstration facility as estimated at the time the
guarantee is issued, which cost shall not include amounts
expended for facilities and equipment used in the extraction of
a mineral other than coal or shale, and in the case of coal
only to the extent that the Secretary determines that the coal
is to be converted to alternative fuel; and
(B) an amount equal to 60 per centum of that portion of the
actual total project cost of any demonstration facility which
exceeds the project cost of such facility as estimated at the
time the loan guarantee is issued;
(3) the Secretary has determined that there will be a continued
reasonable assurance of full repayment;
(4) the obligation is subject to the condition that it not be
subordinated to any other financing;
(5) the Secretary has determined, taking into consideration all
reasonably available forms of assistance under this section and
other Federal and State statutes, that the impacts resulting from
the proposed demonstration facility have been fully evaluated by
the borrower, the Secretary, and the Governor of the affected
State, and that effective steps have been taken or will be taken
in a timely manner to finance community planning and development
costs resulting from such facility under this section, under
other provisions of law, or by other means;
(6) the maximum maturity of the obligation does not exceed
twenty years, or 90 per centum of the projected useful economic
life of the physical assets of the demonstration facility covered
by the guarantee, whichever is less, as determined by the
Secretary;
(7) the Secretary has determined that, in the case of any
demonstration or modular facility planned to be located on Indian
lands, the appropriate Indian tribe, with the approval of the
Secretary of the Interior, has given written consent to such
location;
(8) the obligation provides for the orderly and ratable
retirement of the obligation and includes sinking fund
provisions, installment payment provisions or other methods of
payments and reserves as may be reasonably required by the
Secretary. Prior to approving any repayment schedule the
Secretary may consider the date on which operating revenues are
anticipated to be generated by the project. To the maximum extent
possible repayment or provision therefor shall be required to be
made in equal payments payable at equal intervals; and
(9) the obligation provides that the Secretary shall, after a
period of not less than ten years from issuance of the
obligation, taking into consideration whether the Government's
needs for information to be derived from the project have been
substantially met and whether the project is capable of
commercial operation, determine the feasibility and advisability
of terminating the Federal participation in the project. In the
event that such determination is positive, the Secretary shall
notify the borrower and provide the borrower with not less than
two nor more than three years in which to find alternative
financing. At the expiration of the designated period of time, if
the borrower has been unable to secure alternative financing, the
Secretary is authorized to collect from the borrower an
additional fee of 1 per centum per annum on the remaining
obligation to which the Federal guarantee applies.
(d) Repealed. Pub. L. 96-470, title I, Sec. 109, Oct. 19, 1980, 94
Stat. 2239
(e) Impact on communities, States, and Indian tribes; notice to
State and local officials; procedures applicable for further
action by Secretary subsequent to negative recommendation by
State Governor; criteria and determinations relating to approval
by Secretary of construction and operation plans; establishment,
membership, etc., of advisory panel
(1) As soon as the Secretary knows the geographic location of a
proposed facility for which a guarantee or a commitment to
guarantee or cooperative agreement is sought under this section, he
shall inform the Governor of the State, and officials of each
political subdivision and Indian tribe, as appropriate, in which
the facility would be located or which would be impacted by such
facility. The Secretary shall not guarantee or make a commitment to
guarantee or enter into a cooperative agreement under subsection
(b) or subsection (y) of this section, if the Governor of the State
in which the proposed facility would be located recommends that
such action not be taken, unless the Secretary finds that there is
an overriding national interest in taking such action in order to
achieve the purpose of this section. If the Secretary decides to
guarantee or make a commitment to guarantee or enter into a
cooperative agreement despite a Governor's recommendation not to
take such action, the Secretary shall communicate, in writing, to
the Governor reasons for not concurring with such recommendation.
This Secretary's decision, pursuant to this subsection, shall be
final unless determined upon judicial review initiated by the
Governor to be unlawful by the reviewing court pursuant to section
706(2)(A) through (D) of title 5. Such review shall take place in
the United States court of appeals for the circuit in which the
State involved is located, upon application made within ninety days
from the date of such decision. The Secretary shall, by regulation,
establish procedures for review of, and comment on, the proposed
facility by States, local political subdivisions, and Indian tribes
which may be impacted by such facility, and the general public.
(2) The Secretary shall review and approve the plans of the
applicant for the construction and operation of any demonstration
and related facilities constructed or to be constructed with
assistance under this section. Such plans and the actual
construction shall include such monitoring and other data-gathering
costs associated with such facility as are required by the
comprehensive plan and program under this section. The Secretary
shall determine the estimated total cost of such demonstration
facility, including, but not limited to, construction costs,
startup costs, costs to political subdivisions and Indian tribe by
such facility, and cost of any water storage facilities needed in
connection with such demonstration facility, and determine who
shall pay such costs. Such determination shall not be binding upon
the States, political subdivisions, or Indian tribes.
(3) There is hereby established a panel to advise the Secretary
on matters relating to the program authorized by this section,
including, but not limited to, the impact of the demonstration
facilities on communities and States and Indian tribes, the
environmental and health and safety effects of such facilities, and
the means, measures, and planning for preventing or mitigating such
impacts, and other matters relating to the development of
alternative fuels and other energy sources under this section. The
panel shall include such Governors or their designees as shall be
designated by the Chairman of the National Governors Conference.
Representatives of Indian tribes, industry, environmental
organizations, and the general public shall be appointed by the
Secretary. The Chairman of the panel shall be selected by the
Secretary. No person shall be appointed to the panel who has a
financial interest in any applicant applying for assistance under
this section. Members of the panel shall serve without
compensation. The provisions of section 5816(e) of this title shall
apply to the panel.
(f) Termination, cancellation, revocation; conclusiveness;
contestability
Except in accordance with reasonable terms and conditions
contained in the written contract of guarantee, no guarantee issued
or commitment to guarantee made under this section shall be
terminated, canceled, or otherwise revoked. Such a guarantee or
commitment shall be conclusive evidence that the underlying
obligation is in compliance with the provisions of this section and
that such obligation has been approved and is legal as to
principal, interest, and other terms. Subject to the conditions of
the guarantee or commitment to guarantee, such a guarantee shall be
incontestable in the hands of the holder of the guaranteed
obligation, except as to fraud or material misrepresentation on the
part of the holder.
(g) Default by borrower; procedures applicable to payment by
Secretary and rights of subrogation; notice to Attorney General
by Secretary for further action; protection for benefit of United
States of patents and technologies of defaulting project through
agreements, etc.
(1) If there is a default by the borrower, as defined in
regulations promulgated by the Secretary and in the guarantee
contract, the holder of the obligation shall have the right to
demand payment of the unpaid amount from the Secretary. Within such
period as may be specified in the guarantee or related agreements,
the Secretary shall pay to the holder of the obligation the unpaid
interest on, and unpaid principal of, the guaranteed obligation as
to which the borrower has defaulted, unless the Secretary finds
that there was no default by the borrower in the payment of
interest or principal or that such default has been remedied.
Nothing in this section shall be construed to preclude any
forebearance by the holder of the obligation for the benefit of the
borrower which may be agreed upon by the parties to the guaranteed
obligation and approved by the Secretary.
(2) If the Secretary makes a payment under paragraph (1) of this
subsection, the Secretary shall be subrogated to the rights of the
recipient of such payment (and such subrogation shall be expressly
set forth in the guarantee or related agreements), including the
authority to complete, maintain, operate, lease, or otherwise
dispose of any property acquired pursuant to such guarantee or
related agreements, or any other property of the borrower (of a
value equal to the amount of such payment) to the extent that the
guarantee applies to amounts in excess of the estimated project
cost under subsection (c)(2)(B) of this section, without regard to
the provisions of the Federal Property and Administrative Services
Act of 1949, as amended,)2(! except section 207 of that Act,)2(! or
any other law, or to permit the borrower, pursuant to an agreement
with the Secretary, to continue to pursue the purposes of the
demonstration facility if the Secretary determines that this is in
the public interest. The rights of the Secretary with respect to
any property acquired pursuant to such guarantee or related
agreements, shall be superior to the rights of any other person
with respect to such property.
(3) In the event of a default on any guarantee under this
section, the Secretary shall notify the Attorney General, who shall
take such action as may be appropriate to recover the amounts of
any payments made under paragraph (1) including any payment of
principal and interest under subsection (h) of this section from
such assets of the defaulting borrower as are associated with the
demonstration facility, or from any other security included in the
terms of the guarantee.
(4) For purposes of this section, patents, including any
inventions for which a waiver was made by the Secretary under
section 5908 of this title, and technology resulting from the
demonstration facility, shall be treated as project assets of such
facility. The guarantee agreement shall include such detailed terms
and conditions as the Secretary deems appropriate to protect the
interests of the United States in the case of default and to have
available all the patents and technology necessary for any person
selected, including, but not limited to the Secretary, to complete
and operate the defaulting project. Furthermore, the guarantee
agreement shall contain a provision specifying that patents,
technology, and other proprietary rights which are necessary for
the completion or operation of the demonstration facility shall be
available to the United States and its designees on equitable
terms, including due consideration to the amount of the United
States default payments. Inventions made or conceived in the course
of or under such guarantee, title to which is vested in the United
States under this chapter, shall not be treated as project assets
of such facility for disposal purposes under this subsection,
unless the Secretary determines in writing that it is in the best
interests of the United States to do so.
(h) Contracts to pay, and payment of principal and interest by
Secretary of unpaid balance of guaranteed obligations;
prerequisites
With respect to any obligation guaranteed under this section, the
Secretary is authorized to enter into a contract to pay, and to
pay, holders of the obligations, for and on behalf of the
borrowers, from the fund established by this section, the principal
and interest payments which become due and payable on the unpaid
balance of such obligation if the Secretary finds that -
(1) the borrower is unable to meet such payments and is not in
default; it is in the public interest to permit the borrower to
continue to pursue the purposes of such demonstration facility;
and the probable net benefit to the Federal Government in paying
such principal and interest will be greater than that which would
result in the event of a default;
(2) the amount of such payment which the Secretary 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; and
(3) the borrower agrees to reimburse the Secretary for such
payment on terms and conditions, including interest, which are
satisfactory to the Secretary.
(i) Time for issuance of regulations; procedures applicable to
issuance of regulations and amendments
Regulations required by this section shall be issued within one
hundred and eighty days after February 25, 1978. All regulations
under this section and any amendments thereto shall be issued in
accordance with section 553 of title 5.
(j) Fees for guarantees of obligations; determination of amounts;
excepted guarantees
The Secretary shall charge and collect fees for guarantees of
obligations authorized by subsection (b)(1) of this section, in
amounts which (1) are sufficient in the judgment of the Secretary
to cover the applicable administrative costs, and (2) reflect the
percentage of projects costs guaranteed. In no event shall the fee
be less than 1 per centum per annum of the outstanding indebtedness
covered by the guarantee. Nothing in this subsection shall be
construed to apply to community planning and development assistance
pursuant to subsection (k) of this section.
(k) Community development and planning assistance guarantees; terms
and conditions; rules and regulations; concurrence of Secretary
of Treasury to terms and conditions; payment of taxes in event of
default by borrower; additional direct loans and grants;
redemption of debt obligations; funding requirements and
authorizations; facility title vesting and status upon default
(1) In accordance with such rules and regulations as the
Secretary in consultation with the Secretary of the Treasury shall
prescribe, and subject to such terms and conditions as he deems
appropriate, the Secretary is authorized, for the purpose of
financing essential community development and planning which
directly result from, or are necessitated by, one or more
demonstration facilities assisted under this section to -
(A) guarantee and make commitments to guarantee the payment of
interest on, and the principal balance of obligations for such
financing issued by eligible States, political subdivisions, or
Indian tribes,
(B) guarantee and make commitments to guarantee the payment of
taxes imposed on such demonstration facilities by eligible
non-Federal taxing authorities which taxes are earmarked by such
authorities to support the payment of interest and principal on
obligations for such financing, and
(C) require that the applicant for assistance for a
demonstration facility under this section advance sums to
eligible States, political subdivisions, and Indian tribes to pay
for the financing of such development and planning: Provided,
That the State, political subdivision, or Indian tribe agrees to
provide tax abatement credits over the life of the facilities for
such payments by such applicant.
(2) Prior to issuing any guarantee under this subsection, the
Secretary shall obtain the concurrence of the Secretary of the
Treasury with respect to the timing, interest rate, and substantial
terms and conditions of such guarantee. The Secretary of the
Treasury shall insure to the maximum extent feasible that the
timing, interest rate, and substantial terms and conditions of such
guarantee will have the minimum possible impact on the capital
markets of the United States, taking into account other Federal
direct and indirect securities activities.
(3) In the event of any default by the borrower in the payment of
taxes guaranteed by the Secretary under this subsection, the
Secretary shall pay out of the fund established by this section
such taxes at the time or times they may fall due, and shall have
by reason of such payment a claim against the borrower for all sums
paid plus interest.
(4) If after consultation with the State, political subdivision,
or Indian tribe, the Secretary finds that the financial assistance
programs of paragraph (1) of this subsection will not result in
sufficient funds to carry out the purposes of this subsection, then
the Secretary may -
(A) make direct loans to the eligible States, political
subdivisions, or Indian tribes for such purposes: Provided, That
such loans shall be made on such reasonable terms and conditions
as the Secretary shall prescribe: Provided further, That the
Secretary may waive repayment of all or part of a loan made under
this paragraph, including interest, if the State or political
subdivision or Indian tribe involved demonstrates to the
satisfaction of the Secretary that due to a change in
circumstances there will be net adverse impacts resulting from
such demonstration facility that would probably cause such State,
subdivision, or tribe to default on the loan; or
(B) require that any community development and planning costs
which are associated with, or result from, such demonstration
facility and which are determined by the Secretary to be
appropriate for such inclusion shall be included in the total
costs of the demonstration facility.
(5) The Secretary is further authorized to make grants to States,
political subdivisions, or Indian tribes for studying and planning
for the potential economic, environmental, and social consequences
of demonstration facilities, and for establishing related
management expertise.
(6) At any time the Secretary may, with the concurrence of the
Secretary of the Treasury, redeem, in whole or in part, out of the
fund established by this section, the debt obligations guaranteed
or the debt obligations for which tax payments are guaranteed under
this subsection.
(7) When one or more States, political subdivisions, or Indian
tribes would be eligible for assistance under this subsection, but
for the fact that construction and operation of the demonstration
facilities occurs outside its jurisdiction, the Secretary is
authorized to provide, to the greatest extent possible,
arrangements for equitable sharing of such assistance.
(8) Such amounts as may be necessary for direct loans and grants
pursuant to this subsection shall be available as provided in
annual authorization Acts.
(9) The Secretary, if appropriate, shall provide assistance in
the financing of up to 100 per centum of the costs of the required
community development and planning pursuant to this subsection.
(10) In carrying out the provisions of this subsection, the
Secretary shall provide that title to any facility receiving
financial assistance under this subsection shall vest in the
applicable State, political subdivision, or Indian tribe, as
appropriate, and in the case of default by the borrower on a loan
guarantee such facility shall not be considered a project asset for
the purposes of subsection (g) of this section.
(l) Annual reporting requirements; contents, etc.
(1) The Secretary is directed to submit a report to the Congress
within one hundred and eighty days after February 25, 1978, setting
forth his recommendations on the best opportunities to implement a
program of Federal financial assistance with the objective of
demonstrating production and conservation of energy. Such report
shall be updated and submitted to Congress at least annually and
shall include specific comments and recommendations by the
Secretary of the Treasury on the methods and procedures set forth
in subparagraph (B)(viii) of this subsection, including their
adequacy, and changes necessary to satisfy the objectives stated in
this subsection. This report shall include -
(A) a study of the purchase or commitment to purchase by the
Federal Government, for the use by the United States, of all or a
portion of the products of any alternative fuel facilities
constructed pursuant to this program as a direct or an alternate
form of Federal assistance, which assistance, if recommended,
shall be carried out pursuant to section 5906(a)(4) of this
title; and
(B) a comprehensive plan and program to acquire information and
evaluate the environmental, economic, social, and technological
impacts of the demonstration program under this section. In
preparing such a comprehensive plan and program, the Secretary
shall consult with the Environmental Protection Agency, the
Department of Housing and Urban Development, the Department of
the Interior, the Department of Agriculture, and the Department
of the Treasury, and shall include therein, but not be limited
to, the following:
(i) information about potential demonstration facilities
proposed in the program under this section;
(ii) any significant adverse impacts which may result from
any activity included in the program;
(iii) the extent to which it is feasible to commercialize the
technologies as they affect different regions of the Nation;
(iv) proposed regulations required to carry out the purposes
of this section;
(v) a list of Federal agencies, governmental entities, and
other persons that will be consulted or utilized to implement
the program;
(vi) the methods and procedures by which the information
gathered under the program will be analyzed and disseminated;
(vii) a plan for the study and monitoring of the health
effects of such facilities on workers and other persons,
including, but not limited to, any carcinogenic effect of
alternative fuels; and
(viii) the methods and procedures to insure that (I) the use
of the Federal assistance for demonstration facilities is kept
to the minimum level necessary for the information objectives
of this section, (II) the impact of loan guarantees on the
capital markets of the United States is minimized, taking into
account other Federal direct and indirect securities
activities, and any economic sectors which may be negatively
impacted as a result of the reduction of capital by the
placement of guaranteed loans, and (III) the granting of
Federal loan guarantees under this chapter does not impede
movement toward improvement in the climate for attracting
private capital to develop alternative fuels without continued
direct Federal incentives.
(2) The Secretary shall annually submit a detailed report to the
Congress concerning -
(A) the actions taken or not taken by the Secretary under this
section during the preceding fiscal year, and including, but not
be limited to (i) a discussion of the status of each
demonstration facility and related facilities financed under this
section, including progress made in the development of such
facilities, and the expected or actual production from each such
facility, including byproduct production therefrom, and the
distribution of such products and byproducts, (ii) a detailed
statement of the financial conditions of each such demonstration
facility, (iii) data concerning the environmental, community, and
health and safety impacts of each such facility and the actions
taken or planned to prevent or mitigate such impacts, (iv) the
administrative and other costs incurred by the Secretary and
other Federal agencies in carrying out this program, and (v) such
other data as may be helpful in keeping Congress and the public
fully and currently informed about the program authorized by this
section; and
(B) the activities of the fund referred to in subsection (n) of
this section during the preceding fiscal year, including a
statement of the amount and source of fees or other moneys,
property, or assets deposited into the funds, all payments made,
the notes or other obligations issued by the Secretary, and such
other data as may be appropriate.
(3) The annual reports required by this subsection shall be a
part of the annual report required by section 5914 )3(! of this
title, except that the matters required to be reported by this
subsection shall be clearly set out and identified in such annual
reports. Such reports and the one-hundred-and-eighty-day report
required in paragraph (1) of this subsection shall be transmitted
to the Speaker of the House of Representatives and the House
Committee on Science, Space, and Technology and to the President of
the Senate and the Committee on Energy and Natural Resources of the
Senate.
(m) Congressional finalization of guarantee, etc., subsequent to
report to Congressional committees; scope of authority
Prior to issuing any guarantee or commitment to guarantee or
cooperative agreement pursuant to subsection (b) or subsection (y)
of this section the Secretary shall submit to the Committee on
Science, Space, and Technology of the House of Representatives and
the Committee on Energy and Natural Resources of the Senate a full
and complete report on the proposed demonstration facility and such
guarantee, agreement, or contract. Such guarantee, commitment to
guarantee, cooperative agreement, or contract shall not be
finalized under the authority granted by this section prior to the
expiration of ninety calendar days (not including any day on which
either House of Congress is not in session because of an
adjournment of more than three calendar days to a day certain) from
the date on which such report is received by such committees:
Provided, That, where the cost of a demonstration facility to be
assisted with a guarantee or cooperative agreement pursuant to
subsection (b) or subsection (y) of this section exceeds
$50,000,000 such guarantee or commitment to guarantee or
cooperative agreement shall not be finalized unless (1) the making
of such guarantee or commitment or agreement is specifically
authorized by legislation hereafter enacted by the Congress or (2)
both Houses pass a resolution stating in substance that the
Congress favors the making of such guarantee or commitment or
agreement.
(n) Revolving fund; creation; funding; payments and transfers to
general fund of Treasury; issuance, redemption, etc., of notes or
obligations; applicability to direct loans or planning grants
(1) There is hereby created within the Treasury a separate fund
(hereafter in this section called the "fund") which shall be
available to the Secretary without fiscal year limitation as a
revolving fund for the purpose of carrying out the program
authorized by subsection (b)(1) of this section and subsections
(g), (h), (k), and (y) of this section.
(2) There are hereby authorized to be appropriated to the fund
for administrative expenses from time to time such amounts as may
be necessary to carry out the purposes of the applicable provisions
of this section, including, but not limited to, the payments of
interest and principal and the payment of interest differentials
and redemption of debt. All amounts received by the Secretary as
interest payments or repayments of principal on loans which are
guaranteed under this section, fees, and any other moneys,
property, or assets derived by him from operations under this
section shall be deposited in the fund.
(3) All payments on obligations, appropriate expenses (including
reimbursements to other Government accounts), and repayments
pursuant to operations of the Secretary under this section shall be
paid from the fund subject to appropriations. If at any time the
Secretary determines that moneys in the fund exceed the present and
reasonably foreseeable future requirements of the fund, such excess
shall be transferred to the general fund of the Treasury.
(4) If at any time the moneys available in the fund are
insufficient to enable the Secretary to discharge his
responsibilities as authorized by subsections (b)(1), (g), (h), and
(y) of this section, the Secretary shall issue to the Secretary of
the Treasury notes or other obligations in such forms and
denominations, bearing such maturities, and subject to such terms
and conditions as may be prescribed by the Secretary of the
Treasury. Redemption of such notes or obligations shall be made by
the Secretary from appropriations or other moneys available under
paragraph (2) of this subsection for loan guarantees authorized by
subsection (b)(1) of this section and subsections (g), (h), (k),
and (y) of this section. Such notes or other obligations shall bear
interest at a rate determined by the Secretary of the Treasury,
which shall be not less than a rate determined by taking into
consideration the average market yield on outstanding marketable
obligations of the United States of comparable maturities during
the month preceding the issuance of the notes or other obligations.
The Secretary of the Treasury may at any time sell any of the notes
or other obligations acquired by him under this subsection.
(5) The provisions of this subsection do not apply to direct
loans or planning grants made under subsection (k) of this section.
(o) Definitions
For the purposes of this section, the term -
(1) "State" means any State of the United States, the District
of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin
Islands, American Samoa, any territory or possession of the
United States,
(2) "United States" means the several States, the Commonwealth
of Puerto Rico, the Virgin Islands, Guam, and American Samoa,
(3) "borrower" or "applicant" shall include any individual,
firm, corporation, company, partnership, association, society,
trust, joint venture, joint stock company, or other non-Federal
entity, and
(4) "biomass" shall include, but is not limited to, animal and
timber waste, municipal and industrial waste, sewage, sludge, and
oceanic and terrestrial crops.
(p) Citizenship or nationality requirements for applicants; waiver
(1) An applicant seeking a guarantee or cooperative agreement
under subsection (b) or subsection (y) of 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
citizen or national of the United States unless the Secretary
determines that it satisfactorily meets all the requirements of
section 802 of title 46, Appendix, for determining such
citizenship, except that the provisions in subsection (a) of such
section 802 concerning (A) the citizenship of officers or directors
of a corporation, and (B) the interest required to be owned in the
case of a corporation, association, or partnership operating a
vessel in the coastwise trade, shall not be applicable.
(2) The Secretary, in consultation with the Secretary 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 participants in the
International Energy Agreement.
(q) Transfer of part of program to other agency or authority
No part of the program authorized by this section shall be
transferred to any other agency or authority, except pursuant to
Act of Congress enacted after February 25, 1978.
(r) Statutory provisions applicable to inventions
Inventions made or conceived in the course of or under a
guarantee authorized by this section shall be subject to the title
and waiver requirements and conditions of section 5908 of this
title.
(s) Compliance by persons receiving financial assistance with
Federal and State environmental, etc., laws and regulations, and
licensing requirements
Nothing in this section shall be construed as affecting the
obligations of any person receiving financial assistance pursuant
to this section to comply with Federal and State environmental,
land use, water, and health and safety laws and regulations or to
obtain applicable Federal and State permits, licenses, and
certificates.
(t) Availability of information; procedures applicable; scope of
disclosure; persons to whom disclosure may be made; "person"
defined
The information maintained by the Secretary under this section
shall be made available to the public subject to the provision of
section 552 of title 5 and section 1905 of title 18 and to other
Government agencies in a manner that will facilitate its
dissemination: Provided, That upon a showing satisfactory to the
Secretary by any person that any information, or portion thereof
obtained under this section by the Secretary directly or indirectly
from such person would, if made public, divulge (1) trade secrets
or (2) other proprietary information of such person, the Secretary
shall not disclose such information and disclosure thereof shall be
punishable under section 1905 of title 18: Provided further, That
the Secretary shall, upon request, provide such information to (A)
any delegate of the Secretary for the purpose of carrying out this
chapter, and (B) the Attorney General, the Secretary of
Agriculture, the Secretary of the Interior, the Federal Trade
Commission, the Environmental Protection Agency, the General
Accounting Office, other Federal agencies, or heads of other
Federal agencies, when necessary to carry out their duties and
responsibilities under this and other statutes, but such agencies
and agency heads shall not release such information to the public.
This section is not authority to withhold information from
Congress, or from any committee of Congress upon request of the
Chairman. For the purposes of this subsection, the term "person"
shall include the borrower.
(u) Scope of exercise of statutory authorities
Notwithstanding any other provision of this section, the
authority provided in this section to make guarantees or
commitments to guarantee or enter into cooperative agreements under
subsection (b)(1) or subsection (y) of this section, to make
guarantees or commitments to guarantees, or to make loans or
grants, under subsection (k) of this section, to make contracts
under subsection (h) of this section, and to use fees and receipts
collected under subsections (b), (j), and (y) of this section, and
the authorities provided under subsection (n) of this section shall
be effective only to the extent provided, without fiscal year
limitation, in appropriation Acts enacted after February 25, 1978.
(v) Nondiscrimination requirements; scope of exemption from
requirements for Indian tribes
No person in the United States shall on the grounds of race,
color, religion, national origin, or sex, be excluded from
participation in, be denied benefits of, or be subjected to
discrimination under any program or activity funded in whole or in
part with assistance made available under this section: Provided,
That Indian tribes are exempt from the operation of this
subsection: Provided further, That such exemption shall be limited
to the planning and provision of public facilities which are
located on reservations and which are provided for members of the
affected Indian tribes as the primary beneficiaries.
(w) Participation by small business concerns in program
In carrying out his functions under this section, the Secretary
shall provide a realistic and adequate opportunity for small
business concerns to participate in the program to the optimum
extent feasible consistent with the size and nature of each
project.
(x) Recordkeeping requirements; audit by Comptroller General; labor
standards at construction facilities
(1) Recipients of financial assistance under this section shall
keep such records and other pertinent documents, as the Secretary
shall prescribe by regulation, including, but not limited to,
records which fully disclose the disposition of the proceeds of
such assistance, the cost of any facility, the total cost of the
provision of public facilities for which assistance was used and
such other records as the Secretary may require to facilitate an
effective audit. The Secretary and the Comptroller General of the
United States, or their duly authorized representative shall have
access, for the purpose of audit, to such records and other
pertinent documents.
(2) All laborers and mechanics employed by contractors or
subcontractors in the performance of construction work financed in
whole or in part with assistance under this section shall be paid
wages at rates not less than those prevailing on similar
construction in the locality as determined by the Secretary of
Labor in accordance with sections 3141-3144, 3146, and 3147 of
title 40. The Secretary of Labor shall have, with respect to such
labor standards, the authority and functions set forth in
Reorganization Plan Numbered 14 of 1950 (15 F.R. 3176; 64 Stat.
1267) and section 3145 of title 40.
(y) Issuance of obligations for synthetic fuel conversion
facilities and municipal organic waste energy generation
facilities; rules and regulations; statutory provisions
inapplicable; limitation on outstanding indebtedness; additional
procedural requirements and terms and conditions applicable
(1) The Secretary is authorized in accordance with such rules and
regulations as he shall prescribe after consultation with the
Secretary of the Treasury, to guarantee and to make commitments to
guarantee the payment of interest on, and the principal balance of,
bonds, debentures, notes, and other obligations issued by or on
behalf of any borrower for the purpose of (A) financing the
construction and startup costs of demonstration facilities for the
conversion of municipal or industrial waste, sewage sludge, or
other municipal organic wastes into synthetic fuels, and (B)
financing the construction and startup costs of demonstration
facilities to generate desirable forms of energy (including
synthetic fuels) from municipal or industrial waste, sewage sludge,
or other municipal organic waste. With respect to a guarantee or a
commitment to guarantee authorized by this subsection; the
following subsections of this section shall not apply: (b)(1),
(b)(5), (c)(2), (c)(5), (c)(6), (c)(7), (c)(8), (c)(9), (e)(3),
(j), (k), and (q).
(2) In the case where the Secretary seeks to guarantee or to make
commitments to guarantee as provided by this subsection he is
authorized to incur an outstanding indebtedness which at no time
shall exceed $300,000,000.
(3) The Secretary shall apply the following provisions thereto:
(A) With respect to any demonstration facility for the
conversion of solid waste (as the term is defined in the Resource
Conservation and Recovery Act (42 U.S.C. 6903)), the Secretary,
prior to issuing any guarantee under this section, must be in
receipt of a certification from the Secretary of the
Environmental Protection Agency and any appropriate State or
areawide solid waste management planning agency that the proposed
application for a guarantee is consistent with any applicable
suggested guidelines published pursuant to section 1008(a) of the
Resource Conservation and Recovery Act [42 U.S.C. 6907(a)], and
any applicable State or regional solid waste management plan.
(B) The amount guaranteed shall not exceed 75 per centum of the
total cost of the commercial demonstration facility, as
determined by the Secretary: Provided, That the amount guaranteed
may not exceed 90 per centum of the total cost of the commercial
demonstration facility during the period of construction and
startup.
(C) The maximum maturity of the obligation shall not exceed
thirty years, or 90 per centum of the projected useful economic
life of the physical assets of the commercial demonstration
facility covered by the guarantee, whichever is less, as
determined by the Secretary.
(D) The Secretary shall charge and collect fees for guarantees
of obligations in amounts sufficient in the judgment of the
Secretary to cover the applicable administrative costs and
probable losses on guaranteed obligations, but in any event not
to exceed 1 per centum per annum of the outstanding indebtedness
covered by the guarantee.
(E) No part of the program authorized by this section shall be
transferred to any other agency or authority, except pursuant to
Act of Congress enacted after February 25, 1978: Provided, That
project agreements entered into pursuant to this section for any
commercial demonstration facility for the conversion or
bioconversion of solid waste (as that term is defined in the
Resource Conservation and Recovery Act [42 U.S.C. 6901 et seq.])
shall be administered in accordance with the May 7, 1976,
Interagency Agreement between the Environmental Protection Agency
and the Energy Research and Development Administration on the
Development of Energy From Solid Wastes, and provided
specifically that in accordance with this agreement (i) for those
energy-related projects of mutual interest, planning will be
conducted jointly by the Environmental Protection Agency and the
Secretary, following which project responsibility will be
assigned to one agency; (ii) energy-related projects for recovery
of synthetic fuels or other forms of energy from solid waste
shall be the responsibility of the Secretary; and (iii) the
Environmental Protection Agency shall retain responsibility for
the environmental, economic, and institutional aspects of solid
waste projects and for assurance that such projects are
consistent with any applicable suggested guidelines pursuant to
section 1008 of the Resource Conservation and Recovery Act of
1976, as amended [42 U.S.C. 6907], and any applicable State or
regional solid waste management plan.
(F) With respect to any obligation which is issued after
February 25, 1978, by, or in behalf of, any State, political
subdivision, or Indian tribe and which is either guaranteed
under, or supported by taxes levied by said issuer which are
guaranteed under, this section, the interest paid on such
obligation and received by the purchaser thereof (or the
purchaser's successor in interest) shall be included in gross
income for the purpose of chapter 1 of title 26: Provided, That
the Secretary shall pay to such issuer out of the fund
established by this section such portion of the interest on such
obligations, as determined by the Secretary of the Treasury to be
appropriate after taking into account current market yields (i)
on obligations of said issuer, if any, and (ii) on other
obligations with similar terms and conditions the interest on
which is not so included in gross income for purposes of chapter
1 of title 26, and in accordance with, such terms and conditions
as the Secretary of the Treasury shall require.
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