
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 7USC936e]

 
                          TITLE 7--AGRICULTURE
 
         CHAPTER 31--RURAL ELECTRIFICATION AND TELEPHONE SERVICE
 
    SUBCHAPTER III--RURAL ELECTRIC AND TELEPHONE DIRECT LOAN PROGRAMS
 
Sec. 936e. Administrative prohibitions applicable to certain 
        electric borrowers
        

(a) In general

    For the purpose of relieving borrowers of unnecessary and burdensome 
requirements, the Secretary, guided by the practices of private lenders 
with respect to similar credit risks, shall issue regulations, 
applicable to any electric borrower under this chapter whose net worth 
exceeds 110 percent of the outstanding principal balance on all loans 
made or guaranteed to the borrower by the Secretary, to minimize those 
approval rights, requirements, restrictions, and prohibitions that the 
Secretary otherwise may establish with respect to the operations of such 
a borrower.

(b) Subordination or sharing of liens

    At the request of a private lender providing financing to such a 
borrower for a capital investment, the Secretary shall, expeditiously, 
either offer to share the government's lien on the borrower's system or 
offer to subordinate the government's lien on that property financed by 
the private lender.

(c) Issuance of regulations

    In issuing regulations implementing this section, the Secretary may 
establish requirements, guided by the practices of private lenders, to 
ensure that the security for any loan made or guaranteed under this 
chapter is reasonably adequate.

(d) Authority of Secretary

    Nothing in this section limits the authority of the Secretary to 
establish terms and conditions with respect to the use by borrowers of 
the proceeds of loans made or guaranteed under this chapter or to take 
any other action specifically authorized by law.

(May 20, 1936, ch. 432, title III, Sec. 306E, as added Pub. L. 103-129, 
Sec. 2(c)(7), Nov. 1, 1993, 107 Stat. 1365; amended Pub. L. 103-201, 
Sec. 1, Dec. 17, 1993, 107 Stat. 2342; Pub. L. 103-354, title II, 
Sec. 235(a)(8), (13), Oct. 13, 1994, 108 Stat. 3221.)


                               Amendments

    1994--Pub. L. 103-354 substituted ``Secretary'' for 
``Administrator'' in heading of subsec. (d) and wherever appearing in 
text.
    1993--Pub. L. 103-201 inserted ``certain'' before ``electric'' in 
section catchline and amended text generally. Prior to amendment, text 
read as follows: ``The Administrator may not require prior approval of, 
impose any requirement, restriction, or prohibition with respect to the 
operations of, or deny or delay the granting of a lien accommodation to, 
any electric borrower under this chapter whose net worth exceeds 110 
percent of the outstanding principal balance on all loans made or 
guaranteed to the borrower by the Administrator.''


                               Regulations

    Section 2 of Pub. L. 103-201 provided that: ``The Administrator of 
the Rural Electrification Administration shall issue interim final 
regulations implementing this Act [amending this section] not later than 
180 days after enactment [Dec. 17, 1993]. If the regulations are not 
issued within such period of time, the Administrator may not, until the 
Administrator issues such regulations, require prior approval of, 
establish any requirement, restriction, or prohibition, with respect to 
the operations of any electric borrower under the Rural Electrification 
Act of 1936 [7 U.S.C. 90 et seq.] whose net worth exceeds 110 percent of 
the outstanding principal balance on all loans made or guaranteed to the 
borrower by the Administrator.''
