U.S.C. Code title 7-chap50-subchapt.-sec.19

§ 1925

TITLE 7—AGRICULTURE

nated subpars. (A) and (B) as pars. (1) and (2), respectively, and struck out former subsec. (c) which read as
follows: ‘‘Loans may also be made or insured under this
subchapter to any farm owners or tenants without regard to the requirements of clauses (1), (2), and (3) of
section 1922 of this title for the purposes of meeting
Federal, State, or local requirements for agricultural,
animal, or poultry waste pollution abatement and control facilities, including the construction, modification, or relocation of farm or other structures necessary to comply with such pollution abatement requirements.’’
1991—Subsecs. (a), (d). Pub. L. 102–237 redesignated
subsec. (d) as (a) and moved it to appear before subsec.
(b) and struck out former subsec. (a) which read as follows: ‘‘Loans may also be made or insured under this
subchapter to any farmowners or tenants without regard to the requirements of section 1922(1), (2), and (3)
of this title for the purposes only of land and water development, use and conservation, not including recreational uses and facilities, and without regard to the
requirements of section 1922(2) and (3) of this title, to
farmowners or tenants to finance outdoor recreational
enterprises or to convert to recreational uses their
farming or ranching operations, including those heretofore financed under this chapter.’’
1990—Subsec. (d). Pub. L. 101–624 added subsec. (d).
1978—Subsec. (a). Pub. L. 95–334, § 102(1), struck out
‘‘individual’’ after ‘‘title, to’’.
Subsec. (c). Pub. L. 95–334, § 102(2), added subsec. (c).
1972—Pub. L. 92–419 designated existing provisions as
subsec. (a) and struck out item (a) and (b) designations
appearing before ‘‘to any farmowners’’ and ‘‘without regard to’’, respectively, and added subsec. (b).
1968—Pub. L. 90–488 designated existing provisions as
cl. (a), excluded recreational uses and facilities, and
added cl. (b).
EFFECTIVE DATE OF 2008 AMENDMENT
Amendment of this section and repeal of Pub. L.
110–234 by Pub. L. 110–246 effective May 22, 2008, the
date of enactment of Pub. L. 110–234, see section 4 of
Pub. L. 110–246, set out as an Effective Date note under
section 8701 of this title.
EFFECTIVE DATE OF 1991 AMENDMENT
Amendment by Pub. L. 102–237 effective as if included
in the provision of the Food, Agriculture, Conservation,
and Trade Act of 1990, Pub. L. 101–624, to which the
amendment relates, see section 1101(b)(3) of Pub. L.
102–237, set out as a note under section 1421 of this title.

§ 1925. Limitations on amount of farm ownership
loans
(a) In general
The Secretary shall make or insure no loan
under sections 1922, 1923, 1924, 1934, and 1935 of
this title that would cause the unpaid indebtedness under such sections of any one borrower to
exceed the smaller of (1) the value of the farm or
other security, or (2) in the case of a loan other
than a loan guaranteed by the Secretary,
$300,000, or, in the case of a loan guaranteed by
the Secretary, $700,000 (increased, beginning
with fiscal year 2000, by the inflation percentage
applicable to the fiscal year in which the loan is
guaranteed and reduced by the amount of any
unpaid indebtedness of the borrower on loans
under subchapter II that are guaranteed by the
Secretary).
(b) Determination of value
In determining the value of the farm, the Secretary shall consider appraisals made by competent appraisers under rules established by the
Secretary.

Page 1012

(c) Inflation percentage
For purposes of this section, the inflation percentage applicable to a fiscal year is the percentage (if any) by which—
(1) the average of the Prices Paid By Farmers Index (as compiled by the National Agricultural Statistics Service of the Department
of Agriculture) for the 12-month period ending
on August 31 of the immediately preceding fiscal year; exceeds
(2) the average of such index (as so defined)
for the 12-month period ending on August 31,
1996.
(Pub. L. 87–128, title III, § 305, Aug. 8, 1961, 75
Stat. 308; Pub. L. 91–620, § 1, Dec. 31, 1970, 84 Stat.
1862; Pub. L. 92–419, title I, § 103, Aug. 30, 1972, 86
Stat. 658; Pub. L. 91–524, title VIII, § 807, as added
Pub. L. 93–86, § 1(27)(B), Aug. 10, 1973, 87 Stat. 237;
Pub. L. 95–334, title I, § 103, Aug. 4, 1978, 92 Stat.
421; Pub. L. 102–554, § 3, Oct. 28, 1992, 106 Stat.
4142; Pub. L. 105–277, div. A, § 101(a) [title VIII,
§ 806(a)], Oct. 21, 1998, 112 Stat. 2681, 2681–39; Pub.
L. 110–234, title V, § 5003, May 22, 2008, 122 Stat.
1144; Pub. L. 110–246, § 4(a), title V, § 5003, June 18,
2008, 122 Stat. 1664, 1905.)
CODIFICATION
Pub. L. 110–234 and Pub. L. 110–246 made identical
amendments to this section. The amendments by Pub.
L. 110–234 were repealed by section 4(a) of Pub. L.
110–246.
AMENDMENTS
2008—Subsec. (a)(2). Pub. L. 110–246, § 5003, substituted
‘‘$300,000’’ for ‘‘$200,000’’.
1998—Pub. L. 105–277 inserted section catchline, designated first sentence as subsec. (a), inserted heading,
and substituted ‘‘$700,000 (increased, beginning with fiscal year 2000, by the inflation percentage applicable to
the fiscal year in which the loan is guaranteed and reduced by the amount of any unpaid indebtedness of the
borrower on loans under subchapter II that are guaranteed by the Secretary)’’ for ‘‘$300,000’’, designated second sentence as subsec. (b) and inserted heading, and
added subsec. (c).
1992—Pub. L. 102–554 inserted reference to section 1935
of this title.
1978—Pub. L. 95–334 substituted provisions setting
forth requirements for loans under sections 1922, 1923,
1924, and 1934 of this title for provisions setting forth
requirements for loans under sections 1922, 1923, and
1924 of this title.
1973—Pub. L. 91–524, § 807, as added by Pub. L. 93–86,
substituted ‘‘$225,000’’ for ‘‘$100,000’’ in cl. (a), added cl.
(b), and redesignated former cl. (b) as (c).
1972—Pub. L. 92–419 struck out ‘‘normal’’ before
‘‘value’’ in first and second sentences and before ‘‘market value’’ in last sentence.
1970—Pub. L. 91–620 substituted ‘‘$100,000’’ for
‘‘$60,000’’.
EFFECTIVE DATE OF 2008 AMENDMENT
Amendment of this section and repeal of Pub. L.
110–234 by Pub. L. 110–246 effective May 22, 2008, the
date of enactment of Pub. L. 110–234, see section 4 of
Pub. L. 110–246, set out as an Effective Date note under
section 8701 of this title.

§ 1926. Water and waste facility loans and grants
(a) In general
(1) The Secretary is also authorized to make
or insure loans to associations, including corporations not operated for profit, Indian tribes
on Federal and State reservations and other fed-

Page 1013

TITLE 7—AGRICULTURE

erally recognized Indian tribes, and public and
quasi-public agencies to provide for the application or establishment of soil conservation practices, shifts in land use, the conservation, development, use, and control of water, and the installation or improvement of drainage or waste
disposal facilities, recreational developments,
and essential community facilities including
necessary related equipment, all primarily serving farmers, ranchers, farm tenants, farm laborers, rural businesses, and other rural residents,
and to furnish financial assistance or other aid
in planning projects for such purposes. The Secretary may also make or insure loans to communities that have been designated as rural empowerment zones or rural enterprise communities pursuant to part I of subchapter U of
chapter 1 of title 26, or as rural enterprise communities pursuant to section 766 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 1999 (Public Law 105–277; 112 Stat.
2681, 2681–37), to provide for the installation or
improvement of essential community facilities
including necessary related equipment, and to
furnish financial assistance or other aid in planning projects for such purposes. The Secretary
may also make loans to any borrower to whom
a loan has been made under the Rural Electrification Act of 1936 (7 U.S.C. 901 et seq.), for
the conservation, development, use, and control
of water, and the installation of drainage or
waste disposal facilities, primarily serving farmers, ranchers, farm tenants, farm laborers, rural
businesses, and other rural residents. When any
loan made for a purpose specified in this paragraph is sold out of the Agricultural Credit Insurance Fund as an insured loan, the interest or
other income thereon paid to an insured holder
shall be included in gross income for purposes of
chapter 1 of title 26. With respect to loans of less
than $500,000 made or insured under this paragraph that are evidenced by notes and mortgages, as distinguished from bond issues, borrowers shall not be required to appoint bond
counsel to review the legal validity of the loan
whenever the Secretary has available legal
counsel to perform such review.
(2) WATER, WASTE DISPOSAL, AND WASTEWATER
FACILITY GRANTS.—
(A) AUTHORITY.—
(i) IN GENERAL.—The Secretary is authorized to make grants to such associations to
finance specific projects for works for the
development, storage, treatment, purification, or distribution of water or the collection, treatment, or disposal of waste in rural
areas.
(ii) AMOUNT.—The amount of any grant
made under the authority of this subparagraph shall not exceed 75 per centum of the
development cost of the project to serve the
area which the association determines can
be feasibly served by the facility and to adequately serve the reasonably foreseeable
growth needs of the area.
(iii) GRANT RATE.—The Secretary shall fix
the grant rate for each project in conformity
with regulations issued by the Secretary
that shall provide for a graduated scale of
grant rates establishing higher rates for

§ 1926

projects in communities that have lower
community population and income levels.
(B) REVOLVING FUNDS FOR FINANCING WATER
AND WASTEWATER PROJECTS.—
(i) IN GENERAL.—The Secretary may make
grants to qualified private, nonprofit entities to capitalize revolving funds for the purpose of providing financing to eligible entities for—
(I) predevelopment costs associated with
proposed water and wastewater projects or
with existing water and wastewater systems; and
(II) short-term costs incurred for replacement equipment, small-scale extension services, or other small capital
projects that are not part of the regular
operations and maintenance activities of
existing water and wastewater systems.
(ii) ELIGIBLE ENTITIES.—To be eligible to
obtain financing from a revolving fund under
clause (i), an eligible entity must be eligible
to obtain a loan, loan guarantee, or grant
under paragraph (1) or this paragraph.
(iii) MAXIMUM AMOUNT OF FINANCING.—The
amount of financing made to an eligible entity under this subparagraph shall not exceed—
(I) $100,000 for costs described in clause
(i)(I); and
(II) $100,000 for costs described in clause
(i)(II).
(iv) TERM.—The term of financing provided
to an eligible entity under this subparagraph
shall not exceed 10 years.
(v) ADMINISTRATION.—The Secretary shall
limit the amount of grant funds that may be
used by a grant recipient for administrative
costs incurred under this subparagraph.
(vi) ANNUAL REPORT.—A nonprofit entity
receiving a grant under this subparagraph
shall submit to the Secretary an annual report that describes the number and size of
communities served and the type of financing provided.
(vii) AUTHORIZATION OF APPROPRIATIONS.—
There are authorized to be appropriated to
carry out this subparagraph $30,000,000 for
each of fiscal years 2008 through 2018.
(C) SPECIAL EVALUATION ASSISTANCE FOR
RURAL COMMUNITIES AND HOUSEHOLDS PROGRAM.—
(i) IN GENERAL.—The Secretary may establish the Special Evaluation Assistance for
Rural
Communities
and
Households
(SEARCH)
program,
to
make
predevelopment planning grants for feasibility
studies, design assistance, and technical assistance, to financially distressed communities in rural areas with populations of 2,500
or fewer inhabitants for water and waste disposal projects described in paragraph (1),
this paragraph, and paragraph (24).
(ii) TERMS.—
(I) DOCUMENTATION.—With respect to
grants made under this subparagraph, the
Secretary shall require the lowest amount
of documentation practicable.
(II) MATCHING.—Notwithstanding any
other provisions in this subsection, the

§ 1926

TITLE 7—AGRICULTURE
Secretary may fund up to 100 percent of
the eligible costs of grants provided under
this subparagraph, as determined by the
Secretary.

(iii) FUNDING.—The Secretary may use not
more than 4 percent of the total amount of
funds made available for a fiscal year for
water, waste disposal, and essential community facility activities under this chapter to
carry out this subparagraph.
(iv) RELATIONSHIP TO OTHER AUTHORITY.—
The funds and authorities provided under
this subparagraph are in addition to any
other funds or authorities the Secretary
may have to carry out activities described in
clause (i).
(3) No grant shall be made under paragraph (2)
of this subsection in connection with any
project unless the Secretary determines that the
project (i) will serve a rural area which, if such
project is carried out, is not likely to decline in
population below that for which the project was
designed, (ii) is designed and constructed so that
adequate capacity will or can be made available
to serve the present population of the area to
the extent feasible and to serve the reasonably
foreseeable growth needs of the area, and (iii) is
necessary for an orderly community development consistent with a comprehensive community water, waste disposal, or other development
plan of the rural area.
(4)(A) The term ‘‘development cost’’ means the
cost of construction of a facility and the land,
easements, and rights-of-way, and water rights
necessary to the construction and operation of
the facility.
(B) The term ‘‘project’’ shall include facilities
providing central service or facilities serving individual properties, or both.
(5) APPLICATION REQUIREMENTS.—Not earlier
than 60 days before a preliminary application is
filed for a loan under paragraph (1) or a grant
under paragraph (2) for a water or waste disposal
purpose, a notice of the intent of the applicant
to apply for the loan or grant shall be published
in a general circulation newspaper. The selection of engineers for a project design shall be
done by a request for proposals by the applicant.
(6) The Secretary may make grants aggregating not to exceed $30,000,000 in any fiscal year to
public bodies or such other agencies as the Secretary may determine having authority to prepare comprehensive plans for the development of
water or waste disposal systems in rural areas
which do not have funds available for immediate
undertaking of the preparation of such plan.
(7) Repealed. Pub. L. 107–171, title VI,
§ 6020(b)(1), May 13, 2002, 116 Stat. 363.
(8) In each instance where the Secretary receives two or more applications for financial assistance for projects that would serve substantially the same group of residents within a single rural area, and one such application is submitted by a city, town, county or other unit of
general local government, he shall, in the absence of substantial reasons to the contrary,
provide such assistance to such city, town, county or other unit of general local government.
(9) CONFORMITY WITH STATE DRINKING WATER
STANDARDS.—No Federal funds shall be made

Page 1014

available under this section for a water system
unless the Secretary determines that the water
system will make significant progress toward
meeting the standards established under title
XIV of the Public Health Service Act (commonly known as the ‘‘Safe Drinking Water
Act’’) (42 U.S.C. 300f et seq.).
(10) CONFORMITY WITH FEDERAL AND STATE
WATER POLLUTION CONTROL STANDARDS.—No Federal funds shall be made available under this
section for a water treatment discharge or waste
disposal system unless the Secretary determines
that the effluent from the system conforms with
applicable Federal and State water pollution
control standards.
(11) Repealed. Pub. L. 113–79, title VI, § 6012(b),
Feb. 7, 2014, 128 Stat. 845.
(12)(A) The Secretary shall, in cooperation
with institutions eligible to receive funds under
the Act of July 2, 1862 (12 Stat. 503–505, as
amended; 7 U.S.C. 301–305, 307 and 308), or the
Act of August 30, 1890 (26 Stat. 417–419, as amended; 7 U.S.C. 321–326 and 328), including the
Tuskegee Institute and State, substate, and regional planning bodies, establish a system for
the dissemination of information and technical
assistance on federally sponsored or funded programs. The system shall be for the use of institutions eligible to receive funds under the Act of
July 2, 1862 (12 Stat. 503–505, as amended; 7
U.S.C. 301–305, 307, and 308), or the Act of August
30, 1890 (26 Stat. 417–419, as amended; 7 U.S.C.
321–326 and 328), including the Tuskegee Institute and State, substate, and regional planning
bodies, and other persons concerned with rural
development.
(B) The informational system developed under
this paragraph shall contain all pertinent information, including, but not limited to, information contained in the Federal Procurement Data
System, Federal Assistance Program Retrieval
System, Catalogue of Federal Domestic Assistance, Geographic Distribution of Federal Funds,
United States Census, and Code of Federal Regulations.
(C) The Secretary shall obtain from all other
Federal departments and agencies comprehensive, relevant, and applicable information on
programs under their jurisdiction that are operated in rural areas.
(D) Of the sums authorized to be appropriated
to carry out the provisions of this chapter, not
more than $1,000,000 per year may be expended to
carry out the provisions of this paragraph.
(13) In the making of loans and grants for community waste disposal and water facilities under
paragraphs (1) and (2) of this subsection the Secretary shall accord highest priority to the application of any municipality or other public agency (including an Indian tribe on a Federal or
State reservation or other federally recognized
Indian tribal group) in a rural community having a population not in excess of five thousand
five hundred and which, in the case of water facility loans, has a community water supply system, where the Secretary determines that due
to unanticipated diminution or deterioration of
its water supply, immediate action is needed, or
in the case of waste disposal, has a community
waste disposal system, where the Secretary determines that due to unanticipated occurrences

Page 1015

TITLE 7—AGRICULTURE

the system is not adequate to the needs of the
community. The Secretary shall utilize the Soil
Conservation Service in rendering technical assistance to applicants under this paragraph to
the extent he deems appropriate.
(14) RURAL WATER AND WASTEWATER TECHNICAL
ASSISTANCE AND TRAINING PROGRAMS.—
(A) IN GENERAL.—The Secretary may make
grants to private nonprofit organizations for
the purpose of enabling them to provide to associations described in paragraph (1) of this
subsection technical assistance and training
to—
(i) identify, and evaluate alternative solutions to, problems relating to the obtaining,
storage, treatment, purification, or distribution of water or the collection, treatment, or
disposal of waste in rural areas;
(ii) prepare applications to receive financial assistance for any purpose specified in
paragraph (2) of this subsection from any
public or private source; and
(iii) improve the operation and maintenance practices at any existing works for
the storage, treatment, purification, or distribution of water or the collection, treatment, or disposal of waste in rural areas.
(B) SELECTION PRIORITY.—In selecting recipients of grants to be made under subparagraph
(A), the Secretary shall give priority to private nonprofit organizations that have experience in providing the technical assistance and
training described in subparagraph (A) to associations serving rural areas in which residents
have low income and in which water supply
systems or waste facilities are unhealthful.
(C) FUNDING.—Not less than 1 nor more than
3 percent of any funds appropriated to carry
out paragraph (2) of this subsection for any fiscal year shall be reserved for grants under subparagraph (A) unless the applications, qualifying for grants, received by the Secretary from
eligible nonprofit organizations for the fiscal
year total less than 1 per centum of those
funds.
(15) In the case of water and waste disposal facility projects serving more than one separate
rural community, the Secretary shall use the
median population level and the community income level of all the separate communities to be
served in applying the standards specified in
paragraph (2) of this subsection and section
1927(a)(3)(A) of this title.
(16) Grants under paragraph (2) of this subsection may be used to pay the local share requirements of another Federal grant-in-aid program to the extent permitted under the law providing for such grant-in-aid program.
(17)(A) In the approval and administration of a
loan made under paragraph (1) for a water or
waste disposal facility, the Secretary shall consider fully any recommendation made by the
loan applicant or borrower concerning the technical design and choice of materials to be used
for such facility.
(B) If the Secretary determines that a design
or materials, other than those that were recommended, should be used in the water or waste
disposal facility, the Secretary shall provide
such applicant or borrower with a comprehensive justification for such determination.

§ 1926

(18) In making or insuring loans or making
grants under this subsection, the Secretary may
not condition approval of such loans or grants
upon any requirement, condition or certification
other than those specified under this chapter.
(19) COMMUNITY FACILITIES GRANT PROGRAM.—
(A) IN GENERAL.—The Secretary may make
grants, in a total amount not to exceed
$10,000,000 for any fiscal year, to associations,
units of general local government, nonprofit
corporations, Indian tribes (as such term is defined under section 450b(e) of title 25),,1 and
federally recognized Indian tribes to provide
the Federal share of the cost of developing
specific essential community facilities in
rural areas.
(B) FEDERAL SHARE.—
(i) IN GENERAL.—Except as provided in
clauses (ii) and (iii), the Secretary shall, by
regulation, establish the amount of the Federal share of the cost of the facility under
this paragraph.
(ii) MAXIMUM AMOUNT.—The amount of a
grant provided under this paragraph for a facility shall not exceed 75 percent of the cost
of developing the facility.
(iii) GRADUATED SCALE.—The Secretary
shall provide for a graduated scale for the
amount of the Federal share provided under
this paragraph, with higher Federal shares
for facilities in communities that have lower
community population and income levels, as
determined by the Secretary.
(20) COMMUNITY FACILITIES GRANT PROGRAM FOR
RURAL COMMUNITIES WITH EXTREME UNEMPLOYMENT AND SEVERE ECONOMIC DEPRESSION.—
(A) DEFINITION OF NOT EMPLOYED RATE.—In
this paragraph, the term ‘‘not employed rate’’,
with respect to a community, means the percentage of individuals over the age of 18 who
reside within the community and who are
ready, willing, and able to be employed but are
unable to find employment, as determined by
the department of labor of the State in which
the community is located.
(B) GRANT AUTHORITY.—The Secretary may
make grants to associations, units of general
local government, nonprofit corporations, and
Indian tribes (as defined in section 450b of title
25) in a State to provide the Federal share of
the cost of developing specific essential community facilities in rural communities with
respect to which the not employed rate is
greater than the lesser of—
(i) 500 percent of the average national unemployment rate on November 9, 2000, as determined by the Bureau of Labor Statistics;
or
(ii) 200 percent of the average national unemployment rate during the Great Depression, as determined by the Bureau of Labor
Statistics.
(C) FEDERAL SHARE.—Paragraph (19)(B) shall
apply to a grant made under this paragraph.
(D) AUTHORIZATION OF APPROPRIATIONS.—
There are authorized to be appropriated to
carry out this paragraph $50,000,000 for fiscal
year 2001 and such sums as are necessary for
1 So

in original.

§ 1926

TITLE 7—AGRICULTURE

each subsequent fiscal year, of which not more
than 5 percent of the amount made available
for a fiscal year shall be available for community planning and implementation.
(E) RURAL BROADBAND.—Notwithstanding
subparagraph (C), the Secretary may make
grants to State agencies for use by regulatory
commissions in states 2 with rural communities without local broadband service to establish a competitively, technologically neutral grant program to telecommunications
carriers or cable operators that establish common carrier facilities and services which, in
the commission’s determination, will result in
the long-term availability to such communities of affordable broadband services which
are used for the provision of high speed Internet access.
(21) COMMUNITY FACILITIES GRANT PROGRAM FOR
RURAL COMMUNITIES WITH HIGH LEVELS OF OUT-MIGRATION OR LOSS OF POPULATION.—
(A) GRANT AUTHORITY.—The Secretary may
make grants to associations, units of general
local government, nonprofit corporations, and
Indian tribes (as defined in section 450b of title
25) in a State to provide the Federal share of
the cost of developing specific essential community facilities in any geographic area—
(i) that is represented by—
(I) any political subdivision of a State;
(II) an Indian tribe on a Federal or State
reservation; or
(III) other federally recognized Indian
tribal group;
(ii) that is located in a rural area (as defined in section 2009 3 of this title);
(iii) with respect to which, during the most
recent 5-year period, the net out-migration
of inhabitants, or other population loss,
from the area equals or exceeds 5 percent of
the population of the area; and
(iv) that has a median household income
that is less than the nonmetropolitan median household income of the United States.
(B) FEDERAL SHARE.—Paragraph (19)(B) shall
apply to a grant made under this paragraph.
(C) Authorization of appropriations.—There
are authorized to be appropriated to carry out
this paragraph $50,000,000 for fiscal year 2001
and such sums as are necessary for each subsequent fiscal year, of which not more than 5
percent of the amount made available for a fiscal year shall be available for community
planning and implementation.
(22) RURAL WATER AND WASTEWATER CIRCUIT
RIDER PROGRAM.—
(A) IN GENERAL.—The Secretary shall continue a national rural water and wastewater
circuit rider program that—
(i) is consistent with the activities and results of the program conducted before February 7, 2014, as determined by the Secretary; and
(ii) receives funding from the Secretary,
acting through the Rural Utilities Service.
(B) AUTHORIZATION OF APPROPRIATIONS.—
There is authorized to be appropriated to
2 So

in original. Probably should be capitalized.
References in Text note below.

3 See

Page 1016

carry out this paragraph $20,000,000 for fiscal
year 2014 and each fiscal year thereafter.
(23) MULTIJURISDICTIONAL REGIONAL PLANNING
ORGANIZATIONS.—
(A) GRANTS.—The Secretary shall provide
grants to multijurisdictional regional planning and development organizations to pay
the Federal share of the cost of providing assistance to local governments to improve the
infrastructure, services, and business development capabilities of local governments and
local economic development organizations.
(B) PRIORITY.—In determining which organizations will receive a grant under this paragraph, the Secretary shall give priority to an
organization that—
(i) serves a rural area that, during the
most recent 5-year period—
(I) had a net out-migration of inhabitants, or other population loss, from the
rural area that equals or exceeds 5 percent
of the population of the rural area; or
(II) had a median household income that
is less than the nonmetropolitan median
household income of the applicable State;
and
(ii) has a history of providing substantive
assistance to local governments and economic development organizations.
(C) FEDERAL SHARE.—A grant provided under
this paragraph shall be for not more than 75
percent of the cost of providing assistance described in subparagraph (A).
(D) MAXIMUM AMOUNT OF GRANTS.—The
amount of a grant provided to an organization
under this paragraph shall not exceed $100,000.
(E) AUTHORIZATION OF APPROPRIATIONS.—
There is authorized to be appropriated to
carry out this paragraph $30,000,000 for each of
fiscal years 2003 through 2007.
(24) LOAN GUARANTEES FOR WATER, WASTEWATER, AND ESSENTIAL COMMUNITY FACILITIES
LOANS.—
(A) IN GENERAL.—The Secretary may guarantee a loan made to finance a community facility or water or waste facility project in a rural
area, including a loan financed by the net proceeds of a bond described in section 142(a) of
title 26.
(B) REQUIREMENTS.—To be eligible for a loan
guarantee under subparagraph (A), an individual or entity offering to purchase the loan
shall demonstrate to the Secretary that the
person has—
(i) the capabilities and resources necessary
to service the loan in a manner that ensures
the continued performance of the loan, as
determined by the Secretary; and
(ii) the ability to generate capital to provide borrowers of the loan with the additional credit necessary to properly service
the loan.
(C) USE OF LOAN GUARANTEES FOR COMMUNITY
FACILITIES.—The Secretary shall consider the
benefits to communities that result from
using loan guarantees in carrying out the
community facilities program and, to the
maximum extent practicable, use guarantees
to enhance community involvement.

Page 1017

TITLE 7—AGRICULTURE

(25) TRIBAL COLLEGE AND UNIVERSITY ESSENTIAL
COMMUNITY FACILITIES.—
(A) IN GENERAL.—The Secretary may make
grants to an entity that is a Tribal College or
University (as defined in section 1059c of title
20) to provide the Federal share of the cost of
developing specific Tribal College or University essential community facilities in rural
areas.
(B) FEDERAL SHARE.—The Secretary shall establish the maximum percentage of the cost of
the facility that may be covered by a grant
under this paragraph, except that the Secretary may not require non-Federal financial
support in an amount that is greater than 5
percent of the total cost of the facility.
(C) AUTHORIZATION OF APPROPRIATIONS.—
There is authorized to be appropriated to
carry out this paragraph $10,000,000 for each of
fiscal years 2008 through 2018.
(26) ESSENTIAL COMMUNITY FACILITIES TECHNICAL ASSISTANCE AND TRAINING.—
(A) IN GENERAL.—The Secretary may make
grants to public bodies and private nonprofit
corporations (such as States, counties, cities,
townships, and incorporated towns and villages, boroughs, authorities, districts, and Indian tribes on Federal and State reservations)
that will serve rural areas for the purpose of
enabling the public bodies and private nonprofit corporations to provide to associations
described in paragraph (1) technical assistance
and training, with respect to essential community facilities programs authorized under this
subsection—
(i) to assist communities in identifying
and planning for community facility needs;
(ii) to identify public and private resources
to finance community facility needs;
(iii) to prepare reports and surveys necessary to request financial assistance to develop community facilities;
(iv) to prepare applications for financial
assistance;
(v) to improve the management, including
financial management, related to the operation of community facilities; or
(vi) to assist with other areas of need identified by the Secretary.
(B) SELECTION PRIORITY.—In selecting recipients of grants under this paragraph, the Secretary shall give priority to private, nonprofit,
or public organizations that have experience
in providing technical assistance and training
to rural entities.
(C) FUNDING.—Not less than 3 nor more than
5 percent of any funds appropriated to carry
out each of the essential community facilities
grant, loan and loan guarantee programs as
authorized under this subsection for a fiscal
year shall be reserved for grants under this
paragraph.
(b) Curtailment or limitation of service prohibited
The service provided or made available
through any such association shall not be curtailed or limited by inclusion of the area served
by such association within the boundaries of any
municipal corporation or other public body, or

§ 1926

by the granting of any private franchise for
similar service within such area during the term
of such loan; nor shall the happening of any such
event be the basis of requiring such association
to secure any franchise, license, or permit as a
condition to continuing to serve the area served
by the association at the time of the occurrence
of such event.
(c) Repealed. Pub. L. 91–606, title III, § 302(2),
Dec. 31, 1970, 84 Stat. 1759
(d) Carryover of unused authorizations for appropriations
Any amounts appropriated under this section
shall remain available until expended, and any
amounts authorized for any fiscal year under
this section but not appropriated may be appropriated for any succeeding fiscal year.
(Pub. L. 87–128, title III, § 306, Aug. 8, 1961, 75
Stat. 308; Pub. L. 87–703, title IV, § 401(2), Sept.
27, 1962, 76 Stat. 632; Pub. L. 89–240, § 1, Oct. 7,
1965, 79 Stat. 931; Pub. L. 89–769, § 6(b), Nov. 6,
1966, 80 Stat. 1318; Pub. L. 90–488, §§ 3–5, Aug. 15,
1968, 82 Stat. 770; Pub. L. 91–524, title VIII,
§ 806(a), Nov. 30, 1970, 84 Stat. 1383; Pub. L. 91–606,
title III, § 302(2), Dec. 31, 1970, 84 Stat. 1759; Pub.
L. 91–617, § 1(a), Dec. 31, 1970, 84 Stat. 1855; Pub.
L. 92–419, title I, §§ 104–112, Aug. 30, 1972, 86 Stat.
658, 659; Pub. L. 91–524, title VIII, § 816(c), as
added Pub. L. 93–86, § 1(27)(B), Aug. 10, 1973, 87
Stat. 240; Pub. L. 95–334, title I, §§ 104–107(a), Aug.
4, 1978, 92 Stat. 421, 422; Pub. L. 96–355, § 7, Sept.
24, 1980, 94 Stat. 1174; Pub. L. 96–438, § 2(1), Oct.
13, 1980, 94 Stat. 1871; Pub. L. 97–35, title I, § 121,
Aug. 13, 1981, 95 Stat. 368; Pub. L. 99–198, title
XIII, § 1304(a), Dec. 23, 1985, 99 Stat. 1519; Pub. L.
99–514, § 2, Oct. 22, 1986, 100 Stat. 2095; Pub. L.
101–624, title XXIII, §§ 2316(b), 2321, 2328, 2329,
2341, 2342, 2393, Nov. 28, 1990, 104 Stat. 4008, 4010,
4017, 4026, 4027, 4057; Pub. L. 102–237, title VII,
§ 701(a), (h)(1)(A), (B), Dec. 13, 1991, 105 Stat. 1879,
1880; Pub. L. 103–129, § 3, Nov. 1, 1993, 107 Stat.
1366; Pub. L. 103–354, title II, § 235(b)(5), Oct. 13,
1994, 108 Stat. 3222; Pub. L. 104–127, title VII,
§§ 741(a), 758, 763, Apr. 4, 1996, 110 Stat. 1122, 1132,
1148; Pub. L. 106–387, § 1(a) [title VII, § 773], Oct.
28, 2000, 114 Stat. 1549, 1549A–45; Pub. L. 106–472,
title III, §§ 304(a), 305(a), Nov. 9, 2000, 114 Stat.
2070, 2071; Pub. L. 107–76, title VII, § 762, Nov. 28,
2001, 115 Stat. 743; Pub. L. 107–171, title VI,
§§ 6001–6007(a), 6008, 6020(b)(1), May 13, 2002, 116
Stat. 352–355, 363; Pub. L. 110–234, title VI, §§ 6001,
6002(a), 6003–6007, title VII, § 7511(c)(3), May 22,
2008, 122 Stat. 1161, 1162, 1267; Pub. L. 110–246,
§ 4(a), title VI, §§ 6001, 6002(a), 6003–6007, title VII,
§ 7511(c)(3), June 18, 2008, 122 Stat. 1664, 1923, 1924,
2029; Pub. L. 113–79, title VI, §§ 6001–6006, 6012(b),
Feb. 7, 2014, 128 Stat. 841, 842, 845.)
REFERENCES IN TEXT
Section 766 of the Agriculture, Rural Development,
Food and Drug Administration, and Related Agencies
Appropriations Act, 1999, referred to in subsec. (a)(1), is
Pub. L. 105–277, div. A, § 101(a)[title VII, § 766], Oct. 21,
1998, 112 Stat. 2681, 2681–37, which is not classified to the
Code.
The Rural Electrification Act of 1936, referred to in
subsec. (a)(1), is act May 20, 1936, ch. 432, 49 Stat. 1363,
as amended, which is classified generally to chapter 31
(§ 901 et seq.) of this title. For complete classification of
this Act to the Code, see section 901 of this title and
Tables.

TITLE 7—AGRICULTURE

§ 1926

For definition of ‘‘this chapter’’, referred to in subsec. (a)(2)(C)(iii), (12)(D), (18), see note set out under
section 1921 of this title.
The Public Health Service Act, referred to in subsec.
(a)(9), is act July 1, 1944, ch. 373, 58 Stat. 682, as amended. Title XIV of the Act, known as the Safe Drinking
Water Act, is classified principally to subchapter XII
(§ 300f et seq.) of chapter 6A of Title 42, The Public
Health and Welfare. For complete classification of
these Acts to the Code, see Short Title note and Short
Title of 1974 Amendments note set out under section 201
of Title 42 and Tables.
Act of July 2, 1862 (12 Stat. 503–505, as amended; 7
U.S.C. 301–305, 307 and 308), referred to in subsec.
(a)(12)(A), is act July 2, 1862, ch. 130, 12 Stat. 503, popularly known as the ‘‘Morrill Act’’ and also as the ‘‘First
Morrill Act’’, which is classified generally to subchapter I (§ 301 et seq.) of chapter 13 of this title. For
complete classification of this Act to the Code, see
Short Title note set out under section 301 of this title
and Tables.
Act of August 30, 1890 (26 Stat. 417–419, as amended; 7
U.S.C. 321–326 and 328), referred to in subsec. (a)(12)(A),
is act Aug. 30, 1890, ch. 841, 26 Stat. 417, as amended,
popularly known as the Agricultural College Act of 1890
and also as the Second Morrill Act, which is classified
generally to subchapter II (§ 321 et seq.) of chapter 13 of
this title. For complete classification of this Act to the
Code, see Short Title note set out under section 321 of
this title and Tables.
Section 2009 of this title, referred to in subsec.
(a)(21)(A)(ii), was subsequently amended, and no longer
defines the term ‘‘rural area’’.
CODIFICATION
Pub. L. 110–234 and Pub. L. 110–246 made identical
amendments to this section. The amendments by Pub.
L. 110–234 were repealed by section 4(a) of Pub. L.
110–246.
AMENDMENTS
2014—Subsec. (a)(2)(B)(vii). Pub. L. 113–79, § 6001, substituted ‘‘2018’’ for ‘‘2012’’.
Subsec. (a)(11). Pub. L. 113–79, § 6012(b), struck out
par. (11) which related to rural business opportunity
grants.
Subsec. (a)(19)(C). Pub. L. 113–79, § 6002, struck out
subpar. (C) which related to reservation of funds for
child day care facilities.
Subsec. (a)(22). Pub. L. 113–79, § 6003, added par. (22)
and struck out former par. (22) which related to rural
water and wastewater circuit rider program.
Subsec. (a)(24)(C). Pub. L. 113–79, § 6004, added subpar.
(C).
Subsec. (a)(25)(C). Pub. L. 113–79, § 6005, substituted
‘‘2018’’ for ‘‘2012’’.
Subsec. (a)(26). Pub. L. 113–79, § 6006, added par. (26).
2008—Subsec. (a)(2)(B)(vii). Pub. L. 110–246, § 6001, substituted ‘‘2008 through 2012’’ for ‘‘2002 through 2007’’.
Subsec. (a)(2)(C). Pub. L. 110–246, § 6002(a), added subpar. (C).
Subsec. (a)(11)(C). Pub. L. 110–246, § 7511(c)(3), substituted ‘‘the National Institute of Food and Agriculture’’ for ‘‘the Cooperative State Research, Education, and Extension Service’’.
Subsec. (a)(11)(D). Pub. L. 110–246, § 6003, substituted
‘‘2008 through 2012’’ for ‘‘1996 through 2007’’.
Subsec. (a)(19)(C)(ii). Pub. L. 110–246, § 6004, substituted ‘‘June’’ for ‘‘April’’.
Subsec. (a)(20)(E). Pub. L. 110–246, § 6005, substituted
‘‘State’’ for ‘‘state’’ and struck out ‘‘dial-up Internet
access or’’ before ‘‘broadband service’’.
Subsec. (a)(22)(C). Pub. L. 110–246, § 6006, substituted
‘‘$25,000,000 for fiscal year 2008’’ for ‘‘$15,000,000 for fiscal
year 2003’’.
Subsec. (a)(25)(A). Pub. L. 110–246, § 6007(1), substituted ‘‘grants to an entity that is a Tribal College or
University’’ for ‘‘grants to tribal colleges and universities’’ and ‘‘specific Tribal College or University’’ for
‘‘specific tribal college or university’’.

Page 1018

Subsec. (a)(25)(B). Pub. L. 110–246, § 6007(2), added subpar. (B) and struck out former subpar. (B) which directed the Secretary to establish the maximum percentage of the cost of the facility that could be covered
by a grant, provided that the amount of a grant was
not to exceed 75 percent of the cost of developing the
facility, and directed the Secretary to provide for a
graduated scale that would provide higher percentages
for facilities in communities with lower community
population and income levels.
Subsec. (a)(25)(C). Pub. L. 110–246, § 6007(3), substituted ‘‘2008 through 2012’’ for ‘‘2003 through 2007’’.
2002—Subsec. (a)(1). Pub. L. 107–171, § 6001, inserted
after first sentence ‘‘The Secretary may also make or
insure loans to communities that have been designated
as rural empowerment zones or rural enterprise communities pursuant to part I of subchapter U of chapter
1 of title 26, or as rural enterprise communities pursuant to section 766 of the Agriculture, Rural Development, Food and Drug Administration, and Related
Agencies Appropriations Act, 1999 (Public Law 105–277;
112 Stat. 2681, 2681–37), to provide for the installation or
improvement of essential community facilities including necessary related equipment, and to furnish financial assistance or other aid in planning projects for
such purposes.’’
Subsec. (a)(2). Pub. L. 107–171, § 6002, inserted heading,
designated existing provisions as subpar. (A) and inserted heading, designated first sentence of subpar. (A)
as cl. (i), inserted heading, and struck out ‘‘aggregating
not to exceed $590,000,000 in any fiscal year’’ after ‘‘authorized to make grants’’, designated second sentence
of subpar. (A) as cl. (ii), inserted heading, and substituted ‘‘subparagraph’’ for ‘‘paragraph’’, designated
third sentence of subpar. (A) as cl. (iii) and inserted
heading, and added subpar. (B).
Subsec. (a)(7). Pub. L. 107–171, § 6020(b)(1), struck out
heading and text of par. (7). Text read as follows: ‘‘For
the purpose of water and waste disposal grants and direct and guaranteed loans provided under paragraphs
(1) and (2), the terms ‘rural’ and ‘rural area’ mean a
city, town, or unincorporated area that has a population of no more than 10,000 inhabitants.’’
Subsec. (a)(11)(D). Pub. L. 107–171, § 6003, substituted
‘‘$15,000,000’’ for ‘‘$7,500,000’’ and ‘‘2007’’ for ‘‘2002’’.
Subsec. (a)(19)(C). Pub. L. 107–171, § 6004, added subpar.
(C).
Subsec. (a)(22) to (25). Pub. L. 107–171, §§ 6005–6007(a),
6008, added pars. (22) to (25).
2001—Subsec. (a)(20)(E). Pub. L. 107–76 added subpar.
(E).
2000—Subsec. (a)(19)(A). Pub. L. 106–387, which directed amendment of section 306(a)(19)(A) of the Consolidated Farmers Home Administration Act of 1961 by
inserting ‘‘, Indian tribes (as such term is defined
under section 450b(e) of title 25),’’ after ‘‘nonprofit corporations’’, was executed to this section, which is section 306(a)(19)(A) of the Consolidated Farm and Rural
Development Act, to reflect the probable intent of Congress.
Subsec. (a)(20). Pub. L. 106–472, § 304(a), added par. (20).
Subsec. (a)(21). Pub. L. 106–472, § 305(a), added par. (21).
1996—Subsec. (a)(2). Pub. L. 104–127, § 741(a)(1), substituted ‘‘$590,000,000’’ for ‘‘$500,000,000’’.
Subsec. (a)(5). Pub. L. 104–127, § 758, added par. (5).
Subsec. (a)(7). Pub. L. 104–127, § 741(a)(2), added par. (7)
and struck out former par. (7) which read as follows:
‘‘As used in this chapter, the terms ‘rural’ and ‘rural
area’ shall not include any area in any city or town
which has a population in excess of ten thousand inhabitants, except that (A) for the purpose of loans for essential community facilities under subsection (a)(1) of
this section, the terms ‘rural’ and ‘rural area’ may include any area in any city or town that has a population not in excess of twenty thousand inhabitants;
and (B) for purposes of loans and grants for private
business enterprises under sections 1924(b), 1932 and
1942(b), (c), and (d) of this title the terms ‘rural’ and
‘rural area’ may include all territory of a State that is
not within the outer boundary of any city having a pop-

Page 1019

TITLE 7—AGRICULTURE

ulation of fifty thousand or more and its immediately
adjacent urbanized and urbanizing areas with a population density of more than one hundred persons per
square mile, as determined by the Secretary of Agriculture according to the latest decennial census of the
United States: Provided, That special consideration for
such loans and grants shall be given to areas other than
cities having a population of more than twenty-five
thousand.’’
Subsec. (a)(9), (10). Pub. L. 104–127, § 741(a)(3), added
pars. (9) and (10) and struck out former pars. (9) and (10)
which read as follows:
‘‘(9) No Federal funds shall be authorized for use unless it be certified by the appropriate State water pollution control agency that the water supply system authorized will not result in pollution of waters of the
State in excess of standards established by that agency.
‘‘(10) In the case of sewers and waste disposal systems, no Federal funds shall be advanced hereunder unless the appropriate State water pollution control
agency shall certify that the effluent therefrom shall
conform with appropriate State and Federal water pollution control standards when and where established.’’
Subsec. (a)(11). Pub. L. 104–127, § 741(a)(3), added par.
(11) and struck out former par. (11) which authorized
grants to public bodies, private nonprofit community
development corporations or entities, or other agencies
to enable such recipients to (1) identify and analyze
business opportunities, including opportunities in export markets, that would use local rural economic and
human resources, (2) identify, train, and provide technical assistance to existing or prospective rural entrepreneurs and managers, (3) establish business support
centers and otherwise assist in creation of new rural
businesses, development of methods of financing local
businesses, and enhancing capacity of local individuals
and entities to engage in sound economic activities,
and (4) conduct regional, community, and local economic development planning and coordination, and
leadership development.
Subsec. (a)(14). Pub. L. 104–127, § 741(a)(6)(A)–(D)(i), inserted par. heading and headings for subpars. (A) to (C),
and realigned margins of subpars. and cls. (i) to (iii) of
subpar. (A).
Pub. L. 104–127, § 741(a)(4), (5), redesignated par. (16) as
(14) and struck out former par. (14) which read as follows:
‘‘(14)(A) The Secretary, under such reasonable rules
and conditions as he shall establish, shall make grants
to eligible volunteer fire departments for up to 50 per
centum of the cost of firefighting equipment needed by
such departments but which such departments are unable to purchase through the resources otherwise available to them, and for the cost of the training necessary
to enable such departments to use such equipment efficiently.
‘‘(B) For the purposes of this subsection, the term ‘eligible volunteer fire department’ means any established volunteer fire department in a rural town, village, or unincorporated area where the population is
less than two thousand but greater than two hundred,
as reasonably determined by the Secretary.’’
Subsec. (a)(14)(C). Pub. L. 104–127, § 741(a)(6)(D)(ii),
which directed substitution of ‘‘3 percent of any funds
appropriated’’ for ‘‘2 per centum of any funds provided
in appropriations Acts’’, was executed by making the
substitution for ‘‘2 per centum of any funds provided in
Appropriations Acts’’, to reflect the probable intent of
Congress.
Subsec. (a)(15). Pub. L. 104–127, § 741(a)(4), (5), redesignated par. (17) as (15) and struck out former par. (15)
which authorized making or insuring of loans to associations, including corporations not operated for profit,
Indian tribes on Federal and State reservations and
other federally recognized Indian tribes, and public and
quasi-public agencies, for purpose of financing construction, acquisition, and operation of transmission
facilities for any electric system owned and operated
by a public body located in a rural area which was, as
of October 1, 1976, receiving bulk power from designated
agencies of Department of the Interior.

§ 1926

Subsec. (a)(16) to (18). Pub. L. 104–127, § 741(a)(5), redesignated pars. (18) to (20) as (16) to (18), respectively.
Former pars. (16) to (18) redesignated (14) to (16), respectively.
Subsec. (a)(19). Pub. L. 104–127, § 763, added par. (19).
Pub. L. 104–127, § 741(a)(5), redesignated par. (19) as
(17).
Subsec. (a)(20). Pub. L. 104–127, § 741(a)(5), redesignated par. (20) as (18).
1994—Subsec. (a)(15)(C), (D). Pub. L. 103–354 redesignated subpar. (D) as (C) and struck out former subpar.
(C) which read as follows: ‘‘The Administrator of the
Rural Electrification Administration shall administer
loans made or insured under this paragraph.’’
1993—Subsec. (a)(1). Pub. L. 103–129 inserted after first
sentence ‘‘The Secretary may also make loans to any
borrower to whom a loan has been made under the
Rural Electrification Act of 1936 (7 U.S.C. 901 et seq.),
for the conservation, development, use, and control of
water, and the installation of drainage or waste disposal facilities, primarily serving farmers, ranchers,
farm tenants, farm laborers, rural businesses, and other
rural residents.’’
1991—Subsec. (a)(11)(B)(ii). Pub. L. 102–237, § 701(a)(1),
in subcl. (I) inserted ‘‘and’’ after semicolon and in
subcl. (II) substituted a period for ‘‘; and’’.
Subsec. (a)(12)(D), (20). Pub. L. 102–237, § 701(h)(1)(A),
(B), substituted ‘‘this chapter’’ for ‘‘this Act’’.
Subsec. (a)(21). Pub. L. 102–237, § 701(a)(2), struck out
par. (21) which was identical to par. (20).
1990—Subsec. (a)(1). Pub. L. 101–624, § 2328, inserted
‘‘rural businesses,’’ after ‘‘farm laborers,’’.
Subsec. (a)(2). Pub. L. 101–624, § 2321, struck out
‘‘: Provided, That for fiscal years commencing after
September 30, 1981, such grants may not exceed
$154,900,000 in any fiscal year’’ after ‘‘in rural areas’’.
Subsec. (a)(3). Pub. L. 101–624, § 2316(b), struck out
‘‘and not inconsistent with any planned development
provided in any State, multijurisdictional, county, or
municipal plan approved by competent authority for
the area in which the rural community is located, and
the Secretary shall require the submission of all applications for financial assistance under this section to
the multijurisdictional substate areawide general purpose planning and development agency that has been
officially designated as a clearinghouse agency under
Office of Management and Budget Circular A–95 and to
the county or municipal government having jurisdiction over the area in which the proposed project is to
be located for review and comment within a designated
period of time not to exceed 30 days concerning among
other considerations, the effect of the project upon the
areawide goals and plans of such agency or government. No loan under this section shall be made that is
inconsistent with any multijurisdictional planning and
development district areawide plan of such agency. The
Secretary is authorized to reimburse such agency or
government for the cost of making the required review.
Until October 1, 1973, the Secretary may make grants
prior to the completion of the comprehensive plan, if
the preparation of such plan has been undertaken for
the area’’ after ‘‘of the rural area’’.
Subsec. (a)(11). Pub. L. 101–624, §§ 2341, 2342, amended
par. (11) generally. Prior to amendment, par. (11) read
as follows: ‘‘The Secretary may make grants, not to exceed $15,000,000 annually, to public bodies or such other
agencies as the Secretary may select to provide rural
development technical assistance, rural community
leadership development, and community and areawide
rural development planning.’’
Subsec. (a)(20). Pub. L. 101–624, § 2329, added par. (20).
Subsec. (a)(21). Pub. L. 101–624, § 2393, added par. (21).
1986—Subsec. (a)(1), (15)(B). Pub. L. 99–514 substituted
‘‘Internal Revenue Code of 1986’’ for ‘‘Internal Revenue
Code of 1954’’, which for purposes of codification was
translated as ‘‘title 26’’ thus requiring no change in
text.
1985—Subsec. (a)(2). Pub. L. 99–198 provided for graduated scale of grant rates for each project and higher
rates in communities having lower community population and income levels.

§ 1926

TITLE 7—AGRICULTURE

Subsec. (a)(16) to (19). Pub. L. 99–198 added pars. (16)
to (19).
1981—Subsec. (a)(2). Pub. L. 97–35 inserted provisions
limiting grants for fiscal years after Sept. 30, 1981.
1980—Subsec. (a)(7). Pub. L. 96–438 provided that for
the purpose of loans for essential community facilities
under subsection (a)(1) of this section, terms ‘‘rural’’
and ‘‘rural area’’ may include any area in any city or
town with a population not in excess of twenty thousand.
Subsec. (a)(11) to (15). Pub. L. 96–355 in par. (11) substituted provisions authorizing annual grants not to
exceed $15,000,000 for rural development technical assistance, rural community leadership development,
etc., for provisions authorizing annual grants not to exceed $10,000,000 for preparation of comprehensive plans
for rural development or designated aspects of such
rural development, added par. (12), and redesignated
former pars. (12) to (14) as (13) to (15), respectively.
1978—Subsec. (a)(1). Pub. L. 95–334, § 104, inserted provisions respecting bond counsel requirements for loans
under $500,000.
Subsec. (a)(2). Pub. L. 95–334, § 105, substituted
‘‘$500,000,000’’ for ‘‘$300,000,000’’ and ‘‘75’’ for ‘‘50’’.
Subsec. (a)(7). Pub. L. 95–334, § 106, struck out references to the Commonwealth of Puerto Rico and the
Virgin Islands.
Subsec. (a)(14). Pub. L. 95–334, § 107(a), added par. (14).
1973—Subsec. (a)(13). Pub. L. 91–524, title VIII, § 816(c),
as added by Pub. L. 93–86 added par. (13).
1972—Subsec. (a)(1). Pub. L. 92–419, § 104(1), (2), authorized loans to Indian tribes on Federal and State reservations and other federally recognized Indian tribes
and included as an allowable use provision for essential
community facilities including necessary related
equipment, respectively.
Subsec. (a)(2). Pub. L. 92–419, § 105, substituted
‘‘$300,000,000’’ for ‘‘$100,000,000’’.
Subsec. (a)(3). Pub. L. 92–419, §§ 106, 107, substituted
‘‘project’’ for ‘‘facility’’ where first appearing; in item
(i), substituted ‘‘project’’ for ‘‘facility’’ and inserted in
such text ‘‘, if such project is carried out,’’; in item (ii),
substituted ‘‘will or can be’’ for ‘‘will be or can be’’;
substituted ‘‘and (iii)’’ for ‘‘or (iii)’’ and in such item
(iii), substituted ‘‘an orderly community development
consistent with a comprehensive community water,
waste disposal, or other development plan’’ and ‘‘development provided in any State, multijurisdictional,
county, or municipal plan approved by competent authority’’ for ‘‘orderly community development consistent with a comprehensive community water or sewer
development plan’’ and ‘‘development under State,
county, or municipal plans approved as official plans
by competent authority’’, substituted ‘‘Secretary shall
require the submission of all applications for financial
assistance under this section to the multijurisdictional
substate areawide general purpose planning and development agency that has been officially designated as a
clearinghouse agency under Office of Management and
Budget Circular A–95 and to the county or municipal
government having jurisdiction over the area in which
the proposed project is to be located for review and
comment within a designated period of time not to exceed 30 days concerning among other considerations,
the effect of the project upon the areawide goals and
plans of such agency or government’’ for ‘‘Secretary
shall establish regulations requiring the submission of
all applications for financial assistance under this
chapter to the county or municipal government in
which the proposed project is to be located for review
and comment by such agency within a designated period of time’’; prohibited loans inconsistent with multijurisdictional planning and development district areawide plan of the agency; authorized agency or government reimbursement for cost of making the review; and
extended authority for making grants prior to completion of the comprehensive plan from Oct. 1, 1971 to Oct.
1, 1973.
Subsec. (a)(5). Pub. L. 92–419, § 110, struck out provisions of former par. (5) which prohibited any loan or

Page 1020

grant under subsec. (a) of this section which would
cause the unpaid principal indebtedness of any association under this chapter and Act Aug. 28, 1937, as amended (superseded by this chapter), together with amount
of any assistance in the form of a grant to exceed
$4,000,000 at any one time.
Subsec. (a)(6). Pub. L. 92–419, § 108, substituted
‘‘$30,000,000’’ for ‘‘$15,000,000’’, struck out ‘‘official’’ before ‘‘comprehensive plans’’, and substituted ‘‘waste
disposal systems’’ for ‘‘sewer systems’’.
Subsec. (a)(7). Pub. L. 92–419, § 109, substituted definition of ‘‘rural’’ and ‘‘rural area’’ as excluding an area
in a city or town with a population in excess of ten
thousand inhabitants for prior provision for rural areas
for purposes of water and waste disposal projects excluding an area in a city or town with a population in
excess of 5,500 inhabitants, provided exception provision and special consideration for loans and grants to
areas other than cities having a population of more
than twenty-five thousand.
Subsec. (a)(11), (12). Pub. L. 92–419, §§ 111, 112, added
pars. (11) and (12).
1970—Subsec. (a)(1). Pub. L. 91–617 required inclusion
in gross income of the interest or other income paid to
an insured holder when any loan made for a purpose
specified in subsec. (a)(1) is sold out of the Agricultural
Credit Insurance Fund as an insured loan.
Subsec. (c). Pub. L. 91–606 repealed subsec. (c), added
by Pub. L. 89–769, § 6(b), Nov. 6, 1966, 80 Stat. 1318, which
related to loans to associations in areas suffering major
disasters. See section 4401 et seq. of Title 42, The Public
Health and Welfare.
Subsec. (d). Pub. L. 91–524 added subsec. (d).
1968—Subsec. (a). Pub. L. 90–488 substituted
‘‘$100,000,000’’ for ‘‘$50,000,000’’ in par. (2), ‘‘1971’’ for
‘‘1968’’ in par. (3), and ‘‘$15,000,000’’ for ‘‘$5,000,000’’ in
par. (6), respectively.
1966—Subsec. (c). Pub. L. 89–769 added subsec. (c).
1965—Subsec. (a). Pub. L. 89–240 designated existing
provisions as par. (1), struck out ‘‘including the development of recreational facilities’’ after ‘‘shifts in land
use’’, substituted ‘‘drainage or waste disposal facilities’’ for ‘‘drainage facilities’’, inserted ‘‘and recreational developments’’, deleted provisions which prohibited loans which would cause an association’s unpaid principal indebtedness to exceed $500,000, in the
case of direct loans and $1,000,000 in the case of insured
loans at any one time, and added pars. (2) to (10).
1962—Subsec. (a). Pub. L. 87–703 authorized loans to be
made or insured to provide for the application or establishment of shifts in land use including the development of recreational facilities.
EFFECTIVE DATE OF 2008 AMENDMENT
Amendment of this section and repeal of Pub. L.
110–234 by Pub. L. 110–246 effective May 22, 2008, the
date of enactment of Pub. L. 110–234, except as otherwise provided, see section 4 of Pub. L. 110–246, set out
as an Effective Date note under section 8701 of this
title.
Amendment by section 7511(c)(3) of Pub. L. 110–246 effective Oct. 1, 2009, see section 7511(c) of Pub. L. 110–246,
set out as a note under section 1522 of this title.
EFFECTIVE DATE OF 1991 AMENDMENT
Amendment by section 701(a) of Pub. L. 102–237 effective as if included in the provision of the Food, Agriculture, Conservation, and Trade Act of 1990, Pub. L.
101–624, to which the amendment relates, and amendment by section 701(h)(1)(A), (B) of Pub. L. 102–237 to
any provision specified therein effective as if included
in act that added provision so specified at the time
such act became law, see section 1101(b)(6), (c) of Pub.
L. 102–237, set out as a note under section 1421 of this
title.
EFFECTIVE DATE OF 1980 AMENDMENT
Amendment by Pub. L. 96–355 effective Oct. 1, 1980,
see section 10 of Pub. L. 96–355, set out as an Effective
Date note under section 2204b of this title.

Page 1021

TITLE 7—AGRICULTURE

EFFECTIVE DATE OF 1978 AMENDMENT
Pub. L. 95–334, title I, § 105, Aug. 4, 1978, 92 Stat. 421,
provided that the amendment made by that section is
effective Oct. 1, 1978.
EFFECTIVE DATE OF 1970 AMENDMENTS
Pub. L. 91–617, § 1(b), Dec. 31, 1970, 84 Stat. 1855, provided that: ‘‘The amendment made by subsection (a)
[amending this section] shall apply to the insured loans
sold out of the Agricultural Credit Insurance Fund
after the date of the enactment of this Act [Dec. 31,
1970].’’
Amendment by Pub. L. 91–606 effective Dec. 31, 1970,
see section 304 of Pub. L. 91–606, set out as a note under
section 165 of Title 26, Internal Revenue Code.
EFFECTIVE DATE OF 1966 AMENDMENT
Amendment by Pub. L. 89–769 applicable with respect
to any major disaster occurring after Oct. 3, 1964, see
section 14 of Pub. L. 89–769.
TRANSFER OF FUNCTIONS
Powers, duties, and assets of agencies, offices, and
other entities within Department of Agriculture relating to rural development functions transferred to Rural
Development Administration by section 2302(b) of Pub.
L. 101–624.
ASSISTANCE IN RURAL ALASKA
Pub. L. 106–387, § 1(a) [title VII, § 736], Oct. 28, 2000, 114
Stat. 1549, 1549A–33, provided that: ‘‘Notwithstanding
any other provision of law, for any fiscal year, in the
case of a high cost, isolated rural area of the State of
Alaska that is not connected to a road system—
‘‘(1) in the case of assistance provided by the Rural
Housing Service for single family housing under title
V of the Housing Act of 1949 (7 [42] U.S.C. 1471 et seq.),
the maximum income level for the assistance shall be
150 percent of the average income level in metropolitan areas of the State;
‘‘(2) in the case of community facility loans and
grants provided under paragraphs (1) and (19), respectively, of section 306(a) of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1926(a)) and assistance provided under programs carried out by the
Rural Utilities Service, the maximum income level
for the loans, grants, and assistance shall be 150 percent of the average income level in nonmetropolitan
areas of the State;
‘‘(3) in the case of a business and industry guaranteed loan made under section 310B(a)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C.
1932(a)(1)), to the extent permitted under that Act,
the Secretary of Agriculture shall—
‘‘(A) guarantee the repayment of 90 percent of the
principal and interest due on the loan; and
‘‘(B) charge a loan origination and servicing fee in
an amount not to exceed 1 percent of the amount of
the loan; and
‘‘(4) in the case of assistance provided under the
Rural Community Development Initiative for fiscal
year 2001 carried out under the rural community advancement program established under subtitle E of
the Consolidated Farm and Rural Development Act (7
U.S.C. 2009 et seq.), the median household income
level, and the not employed rate, with respect to applicants for assistance under the Initiative shall be
scored on a community-by-community basis.’’
TEMPORARY EXPANDED ELIGIBILITY OF CERTAIN TIMBER-DEPENDENT COMMUNITIES IN PACIFIC NORTHWEST
FOR LOANS AND GRANTS FROM RURAL DEVELOPMENT
ADMINISTRATION
Pub. L. 103–427, Oct. 31, 1994, 108 Stat. 4373, provided
that:
‘‘(a) FINDINGS.—Congress finds the following:
‘‘(1) Timber-dependent communities in the Pacific
Northwest have contributed significantly to the eco-

§ 1926–1

nomic needs of the United States and have helped ensure an adequate national supply of timber and timber products.
‘‘(2) A significant portion of the timber traditionally harvested in the Pacific Northwest is derived
from Federal forest lands, and these forests have
played an important role in sustaining local economies.
‘‘(b) EXPANDED ELIGIBILITY.—During the period beginning on the date of the enactment of this Act [Oct. 31,
1994] and ending on September 30, 1998, the terms ‘rural’
and ‘rural area’, as used in the Consolidated Farm and
Rural Development Act (7 U.S.C. 1921 et seq.), shall include any town, city, or municipality—
‘‘(1) part or all of which lies within 100 miles of the
boundary of a national forest covered by the Federal
document entitled ‘Forest Plan for a Sustainable
Economy and a Sustainable Environment’, dated
July 1, 1993;
‘‘(2) that is located in a county in which at least 15
percent of the total primary and secondary labor and
proprietor income is derived from forestry, wood
products, or forest-related industries such as recreation and tourism; and
‘‘(3) that has a population of not more than 25,000
inhabitants.
‘‘(c) EFFECT ON STATE ALLOTMENTS OF FUNDS.—This
section shall not be taken into consideration in allotting funds to the various States for purposes of the
Consolidated Farm and Rural Development Act (7
U.S.C. 1921 et seq.), or otherwise affect or alter the
manner under which such funds were allotted to States
before the date of the enactment of this Act [Oct. 31,
1994].’’
RURAL WASTEWATER TREATMENT CIRCUIT RIDER
PROGRAM
Pub. L. 101–624, title XXIII, § 2324, Nov. 28, 1990, 104
Stat. 4013, directed Secretary to establish national
rural wastewater circuit rider grant program that was
to be modeled after existing National Rural Water Association Rural Water Circuit Rider Program that received funding from Farmers Home Administration and
authorized $4,000,000 for each fiscal year to carry out
such program, prior to repeal by Pub. L. 104–127, title
VII, § 703, Apr. 4, 1996, 110 Stat. 1108.
INTEREST RATE RESTRUCTURING FOR CERTAIN
BORROWERS
Pub. L. 100–233, title VI, § 615(b)(2), Jan. 6, 1988, 101
Stat. 1682, provided that: ‘‘Effective July 29, 1987, the
interest rate charged on any loan of $2,000,000 or more
made on such date under section 306 [7 U.S.C. 1926] to
any nonprofit corporation shall be the interest rate
quoted to such nonprofit corporation by the Farmers
Home Administration on June 22, 1987, in the request
for obligation of funds made with respect to the loan.’’
LEASE OF CERTAIN ACQUIRED PROPERTY
Pub. L. 100–233, title VI, § 620, Jan. 6, 1988, 101 Stat.
1684, provided that: ‘‘Notwithstanding any other provision of law, the Secretary of Agriculture may lease to
public or private nonprofit organizations, for a nominal
rent, any facilities acquired in connection with the disposition of a loan made by the Secretary under section
306 [7 U.S.C. 1926]. Any such lease shall be for such reasonable period of time as the Secretary determines is
appropriate.’’

§ 1926–1. Repealed. Pub. L. 104–127, title VII,
§ 702, Apr. 4, 1996, 110 Stat. 1108
Section, Pub. L. 101–624, title XXIII, § 2322, Nov. 28,
1990, 104 Stat. 4010; Pub. L. 102–237, title VII, § 702(f),
Dec. 13, 1991, 105 Stat. 1880; Pub. L. 103–354, title II,
§ 235(b)(6), Oct. 13, 1994, 108 Stat. 3222, related to water
and waste facility financing, including provisions relating to authority, limitation, priority, coordination,
terms, private sector capital, appropriations, repay-