15 USC 3721 - Federal loan guarantees for innovative technologies in manufacturing

U.S Code last checked for updates: May 03, 2024

§ 3721.

Federal loan guarantees for innovative technologies in manufacturing

(a)

Establishment

(b)

Eligible projects

A loan guarantee may be made under the program only for a project that re-equips, expands, or establishes a manufacturing facility in the United States—

(1)

to use an innovative technology or an innovative process in manufacturing;

(2)

to manufacture an innovative technology product or an integral component of such a product; or

(3)

to commercialize an innovative product, process, or idea that was developed by research funded in whole or in part by a grant from the Federal government.

(c)

Eligible borrower

(d)

Limitation on amount

(e)

Limitations on loan guarantee

No loan guarantee shall be made unless the Secretary determines that—

(1)

there is a reasonable prospect of repayment of the principal and interest on the obligation by the borrower;

(2)

the amount of the obligation (when combined with amounts available to the borrower from other sources) is sufficient to carry out the project;

(3)

the obligation is not subordinate to other financing;

(4)

the obligation bears interest at a rate that does not exceed a level that the Secretary determines appropriate, taking into account the prevailing rate of interest in the private sector for similar loans and risks; and

(5)

the term of an obligation requires full repayment over a period not to exceed the lesser of—

(A)

30 years; or

(B)

90 percent of the projected useful life, as determined by the Secretary, of the physical asset to be financed by the obligation.

(f)

Defaults

(1)

Payment by Secretary

(A)

In general

(B)

Payment required

(C)

Forbearance

(2)

Subrogation

(A)

In general

If the Secretary makes a payment under paragraph (1), the Secretary shall be subrogated to the rights, as specified in the loan guarantee, of the recipient of the payment or related agreements including, if appropriate, the authority (notwithstanding any other provision of law)—

(i)

to complete, maintain, operate, lease, or otherwise dispose of any property acquired pursuant to such loan guarantee or related agreement; or

(ii)

to permit the borrower, pursuant to an agreement with the Secretary, to continue to pursue the purposes of the project if the Secretary determines that such an agreement is in the public interest.

(B)

Superiority of rights

(3)

Notification

(g)

Terms and conditions

A loan guarantee under this section shall include such detailed terms and conditions as the Secretary determines appropriate—

(1)

to protect the interests of the United States in the case of default; and

(2)

to have available all the patents and technology necessary for any person selected, including the Secretary, to complete and operate the project.

(h)

Consultation

(i)

Fees

(1)

In general

(2)

Availability

Fees collected under this subsection shall—

(A)

be deposited by the Secretary into the Treasury of the United States; and

(B)

remain available until expended, subject to such other conditions as are contained in annual appropriations Acts.

(3)

Limitation

(j)

Records

(1)

In general

(2)

Access

(k)

Full faith and credit

(l)

Regulations

The Secretary shall issue final regulations before making any loan guarantees under the program. The regulations shall include—

(1)

criteria that the Secretary shall use to determine eligibility for loan guarantees under this section, including—

(A)

whether a borrower is a small- or medium-sized manufacturer; and

(B)

whether a borrower demonstrates that a market exists for the innovative technology product, or the integral component of such a product, to be manufactured, as evidenced by written statements of interest from potential purchasers;

(2)

criteria that the Secretary shall use to determine the amount of any fees charged under subsection (i), including criteria related to the amount of the obligation;

(3)

policies and procedures for selecting and monitoring lenders and loan performance; and

(4)

any other policies, procedures, or information necessary to implement this section.

(m)

Audit

(1)

Annual independent audits

(2)

Report

(n)

Report to Congress

(o)

Coordination and nonduplication

(p)

MEP centers

(q)

Minimizing risk

(r)

Sense of Congress

It is the sense of Congress that no loan guarantee shall be made under this section unless the borrower agrees to use a federally-approved electronic employment eligibility verification system to verify the employment eligibility of—

(1)

all persons hired during the contract term by the borrower to perform employment duties within the United States; and

(2)

all persons assigned by the borrower to perform work within the United States on the project.

(s)

Definitions

In this section:

(1)

Cost

(2)

Innovative process

(3)

Innovative technology

(4)

Loan guarantee

(5)

Obligation

(6)

Program

(t)

Authorization of appropriations

(Pub. L. 96–480, § 26, as added Pub. L. 111–358, title VI, § 602, Jan. 4, 2011, 124 Stat. 4026; amended Pub. L. 117–167, div. B, title II, § 10246(b)(2), Aug. 9, 2022, 136 Stat. 1492.)

cite as: 15 USC 3721