Page:United States Statutes at Large Volume 101 Part 3.djvu/596

 101 STAT. 1894

Effective date. 42 USC 1471 note.

42 USC 1471.

Loans. 42 USC 1472 note.

State and local governments.

PUBLIC LAW 100-242—FEB. 5, 1988

ing the preceding sentence, the maximum income levels established for purposes of this title for such families and persons in the Virgin Islands shall not be less than the highest such levels established for purposes of this title for such families and persons in American Samoa, Guam, the Northern Mariana Islands, and the Trust Territory of the Pacific Islands.". (2) The amendment made by paragraph (1) shall be applicable to any determination of eligibility for assistance under title V of the Housing Act of 1949 made on or after the date of the enactment of this Act. SEC. 303. ESCROWING TAXES AND INSURANCE. Section 501(e) of the Housing Act of 1949 is amended to read as follows: "(e) The Secretary shall establish procedures under which borrowers under this title are required to make periodic payments for the purpose of taxes, insurance, and other necessary expenses as the Secretary may deem appropriate. Notwithstanding any other provision of law, such payments shall not be considered public funds. The Secretary shall direct the disbursement of the funds at the appropriate time or times for the purposes for which the funds were escrowed. If the prepayments made by the borrower are not sufficient to pay the amount due, advances may be made by the Secretary to pay the costs in full, which advances shall be charged to the account of the borrower, bear interest, and be payable in a timely fashion as determined by the Secretary. The Secretary shall notify a borrower in writing when loan payments are delinquent.". SEC. 304. RURAL HOUSING GUARANTEED LOAN DEMONSTRATION. (a) ESTABLISHMENT OF DEMONSTRATION.—The Secretary of Agriculture (referred to in this section as the "Secretary") shall carry out a rural housing guaranteed loan demonstration program under which the Secretary shall, to the extent of amounts provided in appropriation Acts, provide guaranteed loans in accordance with section 502, section 517(d), and the last sentence of section 521(a)(1)(A), of the Housing Act of 1949. (b) AMOUNT AVAILABLE FOR DEMONSTRATION.—

(1) There shall be available for guaranteed loans under this section for any fiscal year in each State an amount equal to whichever of the following is lower: (A) 10 percent of the total loan authority allocated under section 502 of the Housing Act of 1949 to the State for the fiscal year. (B) The average, during the preceding 3 fiscal years, of the funds allocated to the State under section 502 of the Housing Act of 1949 that have not been utilized. (2) Any amount made available under this subsection that is not used before the last 60 days of a fiscal year shall become available for assistance for low income families or persons under section 502 of the Housing Act of 1949. (c) ELIGIBILITY FOR LOANS.—Loans guaranteed pursuant to this section shall be made only to borrowers with moderate incomes that do not exceed the median income of the area, as determined by the Secretary, with adjustments for smaller and larger families. (d) REPORTS TO CONGRESS.—The Secretary shall submit to the Congress—

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