Title 7 - Sec. 904

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[Laws in effect as of January 7, 2003]
[Document not affected by Public Laws enacted between
January 7, 2003 and February 12, 2003]
[CITE: 7USC904]

TITLE 7--AGRICULTURE

CHAPTER 31--RURAL ELECTRIFICATION AND TELEPHONE SERVICE

SUBCHAPTER I--RURAL ELECTRIFICATION

Sec. 904. Loans by Secretary of Agriculture for electrical
plants and transmission lines; preferences; consent of State
authorities

The Secretary is authorized and empowered, from the sums
hereinbefore authorized, to make loans for rural electrification to
persons, corporations, States, Territories, and subdivisions and
agencies thereof, municipalities, peoples' utility districts and
cooperative, nonprofit, or limited-dividend associations, organized
under the laws of any State or Territory of the United States, for the
purpose of financing the construction and operation of generating
plants, electric transmission and distribution lines or systems for the
furnishing and improving of electric service to persons in rural areas,
including by assisting electric borrowers to implement demand side
management, energy conservation programs, and on-grid and off-grid
renewable energy systems, and loans, from funds available under section
903 of this title, to cooperative associations and municipalities for
the purpose of enabling said cooperative associations, and
municipalities to the extent that such indebtedness was incurred with
respect to electric transmission and distribution lines or systems or
portions thereof serving persons in rural areas, to discharge or
refinance long-term debts owned by them to the Tennessee Valley
Authority on account of loans made or credit extended under the terms of
the Tennessee Valley Authority Act of 1933, as amended [16 U.S.C. 831 et
seq.]: Provided, That the Secretary, in making such loans, shall give
preference to States, Territories, and subdivisions and agencies
thereof, municipalities, peoples' utility districts, and cooperative,
nonprofit, or limited-dividend associations, the projects of which
comply with the requirements of this chapter. Such loans shall be on
such terms and conditions relating to the expenditure of the moneys
loaned and the security therefor as the Secretary shall determine and
may be made payable in whole or in part out of the income, except that
no loan for the construction, operation, or enlargement of any
generating plant shall be made unless the consent of the State authority
having jurisdiction in the premises is first obtained. Loans under this
section shall not be made unless the Secretary finds and certifies that
in his judgment the security therefor is reasonably adequate and such
loan will be repaid within the time agreed.

(May 20, 1936, ch. 432, title I, Sec. 4, 49 Stat. 1365; Sept. 21, 1944,
ch. 412, title V, Secs. 502(a), 503, 58 Stat. 739, 740; Dec. 23, 1944,
ch. 725, 58 Stat. 925; June 29, 1948, ch. 703, 62 Stat. 1070; Oct. 28,
1949, ch. 776, Secs. 2, 4(e), 63 Stat. 948; June 15, 1955, ch. 139,
Sec. 2, 69 Stat. 132; Pub. L. 103-129, Sec. 2(c)(2), Nov. 1, 1993, 107
Stat. 1363; Pub. L. 103-354, title II, Sec. 235(a)(13), Oct. 13, 1994,
108 Stat. 3221; Pub. L. 104-127, title VII, Sec. 773, Apr. 4, 1996, 110
Stat. 1149.)

References in Text

The Tennessee Valley Authority Act of 1933, as amended, referred to
in text, is act May 18, 1933. ch. 32. 48 Stat. 58, as amended, which is
classified generally to chapter 12A (Sec. 831 et seq.) of Title 16,
Conservation. For complete classification of this Act to the Code, see
section 831 of Title 16 and Tables.

Amendments

1996--Pub. L. 104-127, in first sentence, struck out ``for the
furnishing of electric energy to persons in rural areas who are not
receiving central station service and'' after ``transmission and
distribution lines or systems'' and substituted ``section 903 of this
title,'' for ``the provisions of sections 903(d) and 903(e) of this
title but without regard to the 25 per centum limitation therein
contained,'', in second sentence, substituted ``, except that'' for ``:
Provided, further, That all such loans shall be self-liquidating within
a period of not to exceed thirty-five years, and shall bear interest at
the rate of 2 per centum per annum; interest rates on the unmatured and
unpaid balance of any loans made pursuant to this section prior to
September 21, 1944, shall be adjusted to 2 per centum per annum, and the
maturity date of any such loans may be readjusted to occur at a date not
beyond thirty-five years from the date of such loan: And provided
further, That'', and in third sentence, struck out ``and section 905 of
this title'' before ``shall not be made''.
1994--Pub. L. 103-354 substituted ``Secretary'' for
``Administrator''.
1993--Pub. L. 103-129 inserted ``and for the furnishing and
improving of electric service to persons in rural areas, including by
assisting electric borrowers to implement demand side management, energy
conservation programs, and on-grid and off-grid renewable energy
systems'' after ``central station service''.
1955--Act June 15, 1955, substituted ``25 per centum'' for ``10 per
centum''.
1949--Act Oct. 28, 1949, inserted ``for rural electrification''
after ``to make loans'' in first sentence, and inserted ``title I,'' in
credit of act May 20, 1936.
1948--Act June 29, 1948, permitted certain municipalities to
refinance with R.E.A. their indebtedness with T.V.A.
1944--Act Dec. 23, 1944, inserted provision authorizing loans to
cooperative associations to enable them to discharge or refinance debts
owed to the Tennessee Valley Authority.
Act Sept. 21, 1944, extended limit of self-liquidating period from
25 to 35 years and changing the rate of interest.

Section Referred to in Other Sections

This section is referred to in sections 907, 912, 922, 931, 932,
936b, 948 of this title; title 16 section 2708.