12 USC 4707 - Assistance provided by Fund

U.S Code last checked for updates: Apr 26, 2024

§ 4707.

Assistance provided by Fund

(a)

Forms of assistance

(1)

In general

The Fund may provide—

(A)

financial assistance through equity investments, deposits, credit union shares, loans, and grants; and

(B)

technical assistance—

(i)

directly;

(ii)

through grants; or

(iii)

by contracting with organizations that possess expertise in community development finance, without regard to whether the organizations receive or are eligible to receive assistance under this subchapter.

(2)

Equity investments

(A)

Limitation on equity investments

(B)

Fund deemed not to control

(3)

Deposits

(4)

Limitations on obligations

(b)

Uses of financial assistance

(1)

In general

Financial assistance made available under this subchapter may be used by assisted community development financial institutions to serve investment areas or targeted populations by developing or supporting—

(A)

commercial facilities that promote revitalization, community stability, or job creation or retention;

(B)

businesses that—

(i)

provide jobs for low-income people or are owned by low-income people; or

(ii)

enhance the availability of products and services to low-income people;

(C)

community facilities;

(D)

the provision of basic financial services;

(E)

housing that is principally affordable to low-income people, except that assistance used to facilitate homeownership shall only be used for services and lending products—

(i)

that serve low-income people; and

(ii)

that—

(I)

are not provided by other lenders in the area; or

(II)

complement the services and lending products provided by other lenders that serve the investment area or targeted population; and

(F)

other businesses and activities deemed appropriate by the Fund.

(2)

Limitations

(c)

Uses of technical assistance

(1)

Types of activities

(2)

Availability of technical assistance

(d)

Amount of assistance

(1)

In general

(2)

Exception

The Fund may provide not more than $3,750,000 of assistance in addition to the amount specified in paragraph (1) during the same 3-year period to an existing community development financial institution that proposes to establish a subsidiary or affiliate for the purpose of serving an investment area or targeted population outside of any State and outside of any metropolitan area presently served by the institution, if—

(A)

the subsidiary or affiliate—

(i)

would be a community development financial institution; and

(ii)

independently—

(I)

meets the selection criteria described in section 4704 of this title; and

(II)

satisfies the selection criteria of section 4706 of this title; and

(B)

no other application for assistance to serve the investment area or targeted population has been submitted to the Administrator within a reasonable period of time preceding the date of receipt of the application at issue.

(3)

Timing of assistance

(e)

Matching requirements

(1)

In general

(2)

Exception

In the case of an applicant with severe constraints on available sources of matching funds, the Fund may permit an applicant to comply with the matching requirements of paragraph (1) by—

(A)

reducing such matching requirement by 50 percent; or

(B)

permitting an applicant to provide matching funds in a form to be determined at the discretion of the Fund, if such applicant—

(i)

has total assets of less than $100,000;

(ii)

serves nonmetropolitan or rural areas; and

(iii)

is not requesting more than $25,000 in assistance.

(3)

Limitation

(4)

Construction of “Federal Government funds”

(f)

Terms and conditions

(1)

Soundness of unregulated institutions

The Fund shall—

(A)

ensure, to the maximum extent practicable, that each community development financial institution (other than an insured community development financial institution or depository institution holding company) assisted under this subchapter is financially and managerially sound and maintains appropriate internal controls;

(B)

require such institution to submit, not less than once during each 18-month period, a statement of financial condition audited by an independent certified public accountant as part of the report required by section 4714(e)(1) of this title; and

(C)

require that all assistance granted under this section is used by the community development financial institution or community development partnership in a manner consistent with the purposes of this subchapter.

(2)

Assistance agreement

(A)

In general

(B)

Performance goals

(C)

Sanctions

The agreement shall provide that, in the event of fraud, mismanagement, noncompliance with this subchapter, or noncompliance with the terms of the agreement, the Fund, in its discretion, may—

(i)

require changes to the performance goals imposed pursuant to subparagraph (B);

(ii)

require changes to the strategic plan submitted pursuant to section 4704(b)(2) of this title;

(iii)

revoke approval of the application;

(iv)

reduce or terminate assistance;

(v)

require repayment of assistance;

(vi)

bar an applicant from reapplying for assistance from the Fund; and

(vii)

take such other actions as the Fund deems appropriate.

(D)

Consultation with tribal governments

(g)

Authority to sell equity investments and loans

(h)

No authority to limit supervision and regulation

(Pub. L. 103–325, title I, § 108, Sept. 23, 1994, 108 Stat. 2172.)

cite as: 12 USC 4707