Sec. 606. Loan terms and repayment

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Section 502(g)(1) ( 45 U.S.C. 822(g)(1) ) is amended by striking 35 years from the date of its execution and inserting the lesser of 35 years after the date of substantial completion of the project or the estimated useful life of the rail equipment or facilities to be acquired, rehabilitated, improved, developed, or established . Section 502(j) ( 45 U.S.C. 822(j) ) is amended— in paragraph (1), by striking the sixth anniversary date of the original loan disbursement and inserting 5 years after the date of substantial completion ; and by adding at the end the following:

If at any time after the date of substantial completion the project is unable to generate sufficient revenues to pay the scheduled loan repayments of principal and interest on the direct loan, the Secretary, subject to subparagraph (B), may allow, for a maximum aggregate time of 1 year over the duration of the direct loan, the obligor to add unpaid principal and interest to the outstanding balance of the direct loan. A payment deferred under subparagraph

(A)shall— continue to accrue interest under paragraph

(2)until the loan is fully repaid; and be scheduled to be amortized over the remaining term of the loan. Any excess revenues that remain after satisfying scheduled debt service requirements on the project obligations and direct loan and all deposit requirements under the terms of any trust agreement, bond resolution, or similar agreement securing project obligations may be applied annually to prepay the direct loan without penalty. The direct loan may be prepaid at any time without penalty from the proceeds of refinancing from non-Federal funding sources. . Section 502 ( 45 U.S.C. 822 ) is amended by adding at the end the following: Subject to paragraph

(2)and as soon as practicable after substantial completion of a project, the Secretary, after notifying the obligor, may sell to another entity or reoffer into the capital markets a direct loan for the project if the Secretary determines that the sale or reoffering has a high probability of being made on favorable terms. In making a sale or reoffering under paragraph (1), the Secretary may not change the original terms and conditions of the secured loan without the prior written consent of the obligor . Section 502 ( 45 U.S.C. 822 ), as amended in subsection (c), is further amended by adding at the end the following: Except as provided in paragraph (2)(B), a direct loan shall not be subordinated to the claims of any holder of project obligations in the event of bankruptcy, insolvency, or liquidation of the obligor. The Secretary may waive the requirement under paragraph

(1)for a public agency borrower that is financing ongoing capital programs and has outstanding senior bonds under a preexisting indenture if— the direct loan is rated in the A category or higher; the direct loan is secured and payable from pledged revenues not affected by project performance, such as a tax-based revenue pledge or a system-backed pledge of project revenues; and the program share, under this title, of eligible project costs is 50 percent or less. The Secretary may impose limitations for the waiver of the nonsubordination requirement under this paragraph if the Secretary determines that such limitations would be in the financial interest of the Federal Government. .

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45 USC 822(g)(1)
45 USC 822(j)
45 USC 822

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Sec. 606

Loan terms and repayment

Cite45 USC 822(g)(1)

Cite45 USC 822(j)

Cite45 USC 822

Cites 3Cited by 0 across 0 sources