Page:United States Statutes at Large Volume 84 Part 1.djvu/407

 84 STAT. ]

PUBLIC LAW 91-296-JUNE 30, 1970

349

a PROVISIONS APPLICABLE 'W LOANS TO P U B L I C F A C I L I T I E S

"SEC. 627. (a)(1) Any loan made by the Secretary to a public Interest rates. agency under this part for the modernization or construction of a public hospital or other health facility shall require such public agency to pay interest thereon at a rate comparable to the current rate of interest prevailing with respect to loans, to nonprofit private agencies, which are guaranteed under this part, for the modernization or construction of similar facilities in the same or similar areas, minus 3 per centum per annum. "(2)(A) No loan to a public agency shall be made under this part unless— "(i) the Secretary is reasonably satisfied that such agency will be able to make payments of principal and interest thereon when due, and " (ii) such agency provides the Secretary with reasonable assurances that there will be available to such agency such additional funds as may be necessary to complete the project with respect to which such loan is requested. " (B) Any loan to a public agency shall have such security, have such maturity date, be repayable in such installments, and be subject to such other terms and conditions (including provision for recovery in case of default) as the Secretary determines to be necessary to carry out the purposes of this part while adequately protecting the financial interests of the United States. " (3) I n making loans to public agencies under this part, the Secre- Distribution. tary shall give due regard to achieving an equitable geographical distribution of such loans. " (b)(1) The Secretary shall from time to time, but with due regard Sale. to the financial interests of the United States, sell loans referred to in subsection (a)(1) either on the private market or to the Federal National Mortgage Association in accordance with section 302 of the Federal National Mortgage Association Charter Act. post^^p.%50^' "(2) Any loan so sold shall be sold for an amount which is equal 12'use 1717. (or approximately equal) to the amount of the unpaid principal of such loan as of the time of sale. " (c)(1) The Secretary is authorized to enter into an agreement Agreements. with the purchaser of any loan sold under this part under which the Secretary agrees— " (A) to guarantee to such purchaser (and any successor in interest to such purchaser) payment of the principal and interest payable under such loan, and (B) to pay as an interest subsidy to such purchaser (and any successor in interest of such purchaser) amounts which when added to the amount of interest payable on such loan, are eq^uivalent to a reasonable rate of interest on such loan as determined by the Secretary, after taking into account the range of prevailing interest rates in the private market on similar loans and the risks assumed by the United States. " (2) Any such agreement— " (A) may provide that the Secretary shall act as agent of any such purchaser, for the purpose of collecting from the public agency to which such loan was made and paying over to such purchaser, any payments of principal and interest payable by such agency under such loan; " (B) may provide for the repurchase by the Secretary of any such loan on such terms and conditions as may be specified in the agreement;

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