[Federal Register Volume 62, Number 45 (Friday, March 7, 1997)]
[Proposed Rules]
[Pages 10483-10488]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-5223]
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DEPARTMENT OF AGRICULTURE
Rural Telephone Bank
7 CFR Part 1610
Rural Utilities Service
7 CFR Parts 1735, 1737, 1739, and 1746
Rural Telephone Bank and Telecommunications Program Loan
Policies, Types of Loans, Loan Requirements
AGENCY: Rural Utilities Service and Rural Telephone Bank, USDA.
ACTION: Proposed rule.
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SUMMARY: The Rural Utilities Service (RUS) proposes to amend its
regulations to incorporate changes to the telecommunications loan
program
[[Page 10484]]
required by the 1996 Farm Bill and the regulatory reinvention
initiative of the Vice President's National Performance Review. RUS has
reviewed the regulations concerning the telecommunications program and
the Rural Telephone Bank loan policies and requirements to determine
whether they are necessary, impose the least possible burden consistent
with safety and soundness, and are written in a clear, straightforward
manner. As a result of this review, the RUS telecommunications program
proposes to update and streamline its regulations and policy
statements. In addition, this regulation proposes to eliminate some
policies and procedures that have become obsolete.
DATES: Written comments must be received by RUS or carry a postmark or
equivalent not later than May 6, 1997.
ADDRESSES: Submit written comments to Jonathan Claffey, Acting Deputy
Director, Advanced Telecommunications Services Staff, Rural Utilities
Service, 1400 Independence Ave., SW., STOP 1701, Room 2919, South
Building, Washington, DC 20250-1701. RUS requests a signed original and
three copies of all comments (7 CFR part 1700). All comments received
will be made available for public inspection at room 4034, South
Building, U.S. Department of Agriculture, Washington, DC, between 8:00
a.m. and 4:00 p.m. (7 CFR part 1.27(b)).
FOR FURTHER INFORMATION CONTACT: Cheryl Gamboney, Analyst, Advanced
Telecommunications Services Staff, (address as above). Telephone: (202)
720-0415. Facsimile: (202) 720-2734.
SUPPLEMENTARY INFORMATION:
Classification
This proposed rule has been determined to be not significant and
has not been reviewed by the Office of Management and Budget under
Executive Order 12866.
Civil Justice Reform
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. RUS has determined that this proposed rule meets
the applicable standards provided in Sec. 3. of the Executive Order.
Regulatory Flexibility Act Certification
Pursuant to section 605(b) of the Regulatory Flexibility Act, 5
U.S.C. 605(b), RUS certifies that this proposed rule will not have a
significant economic impact on a substantial number of small entities.
If a rule has a significant economic impact on a substantial number of
small entities, the Regulatory Flexibility Act requires agencies to
analyze regulatory options that would minimize any significant impact
of a rule on small entities. The application for loans under the RUS
telecommunications program are discretionary, regulatory requirements
will, therefore, apply only to those entities which choose to apply for
funding.
This action is being taken as part of the National Performance
Review program to eliminate excess regulations and to improve the
quality of those that remain in effect. This proposed rule simply
reduces the Times Interest Earned Ratio requirement for all borrowers,
simplifies current cash distribution and investment requirements for
all borrowers, and standardizes determination of loan maturity. This
proposed rule is consistent with RUS' continuing effort to devolve, in
particular, cash management authority to the borrowers. It is also
consistent with the goals of the regulatory reinvention initiative of
the National Performance Review.
Information Collection and Recordkeeping Requirements
A notice of public comments was issued in the Federal Register on
February 25, 1997, at 62 FR 8421 requesting approval by the Office of
Management and Budget (OMB) pursuant to the Paperwork Reduction Act of
1995 (44 U.S.C. Chapter 35, as amended) under control number 0572-0079.
Send questions or comments regarding this burden or any other
aspect of these collections of information, including suggestions for
reducing the burden, to F. Lamont Heppe, Jr., Director, Program Support
and Regulatory Analysis, Rural Utilities Service, STOP 1522,
Washington, DC 20250-1522.
National Environmental Policy Act Certification
RUS has determined that this proposed rule will not significantly
affect the quality of the human environment as defined by the National
Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.). Therefore,
this action does not require an environmental impact statement or
assessment.
Program Affected
The program described by this proposed rule is listed in the
Catalog of Federal Domestic Assistance Programs under 10.851, Rural
Telecommunications Loans and Loan Guarantees, and 10.582, Rural
Telephone Bank Loans. This catalog is available on a subscription basis
from the Superintendent of Documents, the United States Government
Printing Office, Washington, DC 20402.
Intergovernmental Review
This program is excluded from the scope of Executive Order 12372,
Intergovernmental Consultation. A Notice of Final Rule entitled
Department Programs and Activities Excluded from Executive Order 12372
(50 FR 47034) exempts RUS and Rural Telephone Bank loans and loan
guarantees to governmental and non-governmental entities from coverage
under this Order.
Unfunded Mandate
This rule contains no Federal mandates (under the regulatory
provisions of Title II of the Unfunded Mandate Reform Act) for State,
local, and tribal governments or the private sector. Thus today's rule
is not subject to the requirements of sections 202 and 205 of the
Unfunded Mandate Reform Act.
Background
The Federal Agriculture Improvement and Reform Act of 1996 (Pub. L.
104-127) amended Section 309 of the Rural Electrification Act of 1936,
as amended (7 U.S.C. 901 et seq.)(RE Act), by eliminating the provision
that allows RUS telecommunications borrowers to determine the term of a
loan made under Title 3 of the RE Act at the time the loan application
is submitted.
The present maximum loan period is 35 years. With rapidly changing
technology, obsolescence is occurring more quickly; therefore,
borrowers are depreciating their facilities at a faster rate. If plant
financed is retired and replaced by new plant before the loan is
repaid, earnings from this new plant will have to be used to pay the
old loan and any new loan used to finance the replacement facilities.
If the loan period is longer than the depreciation period and the
capital recovered through depreciation is not used to replace plant,
the loan could be undercollateralized and the borrower's rate base
would be eroded.
RUS is, therefore, proposing that the loan period for RUS and Rural
Telephone Bank (Bank) loans not exceed the expected composite economic
life of the facilities to be financed; expected composite economic life
means the depreciated life plus three years. Bank borrowers may request
a repayment period that is longer than the expected composite economic
life of
[[Page 10485]]
the facilities financed by the loan. Such borrowers, however, will be
required to provide additional security for the loan by maintaining a
funded reserve. The maximum loan period for all loans will remain at 35
years.
Further, under existing regulations, if the loan maturity period
selected by the borrower exceeds the expected composite economic life
of the facilities financed by a period of more than three years, the
loan would be conditioned upon the borrower electing to maintain either
a net plant to secured debt ratio of at least 1.2, or a funded reserve
in such amount that the balance of the reserve plus the value of the
facilities less depreciation be at least equal to the remaining
principal payments on the loan. RUS is proposing to offer, subject to
certain conditions, borrowers subject to the funded reserve or net
plant to secured debt ratio requirements an option to replace those
notes with notes that match the remaining composite economic life of
the facilities financed, as determined by the feasibility study
prepared in connection with the loan. Borrowers meeting these
conditions replacing Bank notes will not be required to pay a
prepayment premium, if such requirement is contained in the original
note.
To optimize the use of loan funds, RUS proposes to limit the size
of RUS cost-of-money loans and Bank loans made to individual borrowers
in order to distribute the amount of RUS cost-of-money and Bank funds
appropriated among a greater number of borrowers. Section 201 of the RE
Act, in part, clearly states that, ``* * * The Administrator in making
such loans shall, insofar as possible, obtain assurance that the
telecommunications service to be furnished or improved thereby will be
made available to the widest practical number of rural users * * *''.
In fiscal years 1991 through 1995, the Agriculture Appropriation
Acts had established loan levels for the Bank in amounts insufficient
to provide for the total number of applications completed and on hand
at the end of those fiscal years. If the Bank had limited the amount of
individual loans to no more than 10 percent of the lending authority,
approximately $35.6 million of Bank funding over those five years would
have been available to other borrowers. Correspondingly, approximately
$25.6 million of RUS cost-of-money funding also would have been
available to other borrowers.
Moreover, recent Federal action affecting RUS and Bank borrowers is
the Telecommunications Act of 1996, a broad and far-reaching reform of
communications law that is expected to change notably the
telecommunications industry. The Telecommunications Act will provide
for a more competitive, deregulated national telecommunications policy
framework. Of greatest immediate relevance for RUS and Bank borrowers
are forthcoming regulations by the Federal Communications Commission
concerning certain provisions of the Telecommunications Act. Pending
the outcome of these forthcoming regulations, RUS borrowers have
temporarily delayed plans for major network construction. However, now
more than ever, the need and importance of RUS telecommunications loans
is crucial for future development of telecommunications infrastructure
in rural America. As a direct result of RUS's telecommunications loans,
rural communities have been enjoying access to advanced
telecommunications services.
To continue fulfilling RUS's mission of ensuring that rural
telecommunications providers have the means to modernize their
networks, to fully effect the mandated area coverage provision of the
RE Act, and to achieve maximum use of funds available, RUS is proposing
to limit the loan amount to any single borrower in a fiscal year to,
generally, no more than 10 percent of the lending authority from
appropriations in any fiscal year. This proposed regulation would
optimize the use of a limited source of loan funding by distributing
the amount of funding available among the greatest number of applicants
in an economical, efficient, and orderly manner.
In general, the security documents required in connection with RUS
loans, Bank loans, and RUS guarantees contain provisions requiring
borrowers to maintain a certain Times Interest Earned Ratio (TIER)
level. In particular, under existing regulations, borrowers are
required to maintain after the end of the Forecast Period a TIER equal
to the projected TIER determined by the feasibility study prepared in
connection with the loan, but not greater than 1.75. RUS proposes to
reduce the maximum TIER maintenance requirement to no more than 1.50
for all borrowers receiving any type of loan after the effective date
of the final rule. In 1995 almost ninety percent of RUS's reporting
borrowers had a TIER greater than 1.5.
Section 205 of the RE Act and the RUS mortgage documents, contain
RUS's policy regarding investments and distributions of assets by
borrowers. In general, borrowers with a certain minimum net worth
requirement are permitted to make capital distributions without RUS
approval in a cumulative amount up to a limit set by a formula that
considers the borrowers past financial performance. The calculation
used to determine a borrower's allowable distribution level has, over
the years, become exceedingly complex. RUS is simplifying its policy by
eliminating the complex formula used to determine the allowable level
of distributions and investments and replacing it with a more
straightforward process which can readily be calculated from a
borrower's current financial statements. The new requirements limit the
amount of distributions and investments relative to the borrower's
current net worth. To facilitate the availability of cash flow to
support diversified activities, RUS proposes predefined tests, using
current annual financial data only, for determining the level of
permitted distributions and investments. This approach would recognize
and provide for diversity among borrowers without creating undue
complexity. RUS's new policy regarding investments and distributions of
assets by borrowers will be in all mortgages for loans approved after
the effective date of the final rule. Borrowers that have not received
a loan after the effective date of the final rule may request the
Administrator to apply the new requirements to them.
For over 25 years it has been the RUS preferred design to bury
outside plant (e.g., buried wire and cable telecommunications
facilities and associated material) whenever economically feasible.
This method of construction minimizes potential impairment of
borrowers' facilities due to damage caused by storms and other natural
catastrophes. Based on its long experience in this type of design, RUS
proposes to adopt the policy that it will finance only buried plant for
all loans unless RUS determines that buried plant is not economically
feasible.
RUS further proposes to make technical corrections to final
regulations which were reorganized and redesignated on September 27,
1990, at 55 FR 39393. In particular, certain regulations contained
cross references which inadvertently had not been updated. This action
is simply a correction to these regulations with no change to
substance. Changes to regulatory text are merely to update cross
references. As currently published, the final regulations may prove to
be misleading.
On August 27, 1991, at 56 FR 42461, RUS published 7 CFR parts 1739
and 1746 that established pre-and post-loan policies for 90 percent RUS
guarantees
[[Page 10486]]
of certain loans from qualified private lenders. This program was
authorized under section 314 of the RE Act. The Rural Electrification
Loan Restructuring Act of 1993, Public Law 103-129, signed by President
Clinton on November 1, 1993, amended section 314 of the RE Act to
abolish this 90 percent guarantee program. RUS is, therefore, removing
7 CFR parts 1739 and 1746.
List of Subjects
7 CFR Part 1610
Accounting, Loan programs--communications, Reporting and
recordkeeping requirements, Rural areas, Telecommunications.
7 CFR Part 1735
Accounting, Loan programs--communications, Reporting and
recordkeeping requirements, Rural areas, Telecommunications.
7 CFR Part 1737
Accounting, Loan programs--communications, Reporting and
recordkeeping requirements, Rural areas, Telecommunications.
7 CFR Part 1739
Accounting, Guaranteed program, Loan programs--communications,
Reporting and recordkeeping requirements, Rural areas,
Telecommunications.
7 CFR Part 1746
Accounting, Guaranteed program, Loan programs--communications,
Reporting and recordkeeping requirements, Rural areas,
Telecommunications.
For the reasons set forth in the preamble, and under the authority
of 7 U.S.C. 901 et. seq., chapters XVI and XVII of Title 7 of the Code
of Federal Regulations are proposed to be amended as follows:
CHAPTER XVI
PART 1610--LOAN POLICIES
1. The authority citation for part 1610 continues to read as
follows:
Authority: 7 U.S.C. 941 et seq.; Pub. L. 103-354, 108 Stat. 3178
(7 U.S.C. 6941, et. seq.).
2. In Sec. 1610.6, new paragraph (d) is added to read as follows:
Sec. 1610.6 Concurrent Bank and RUS cost-of-money loans.
* * * * *
(d) Generally, no more than 10 percent of lending authority from
appropriations in any fiscal year for Bank and RUS cost-of-money loans
may be loaned to a single borrower. The Bank will publish by notice in
the Federal Register the dollar limit that may be loaned to a single
borrower in that particular fiscal year based on approved Bank and RUS
lending authority.
3. In Sec. 1610.11, a new paragraph (c) is added to read as
follows:
Sec. 1610.11 Prepayments.
* * * * *
(c) Borrowers that qualify to issue a refunding note or notes in
accordance with 7 CFR 1735.43, Payments on loans, shall not be required
to pay a prepayment premium on all payments made in accordance with the
new payment schedule.
CHAPTER XVII
PART 1735--GENERAL POLICIES, TYPES OF LOANS, LOAN REQUIREMENTS--
TELECOMMUNICATIONS PROGRAM
1. The part heading for part 1735 is revised as set forth above.
1a. The authority citation for part 1735 is revised to read as
follows:
Authority: 7 U.S.C. 901 et seq., 1921 et seq.; Pub. L. 103-354,
108 Stat. 3178 (7 U.S.C. 6941 et. seq.).
2. In Sec. 1735.2, the definition of Construction fund is amended
by removing the reference ``See 7 CFR part 1758.'', the definitions for
Adjusted assets and Adjusted net worth are removed, and new definitions
Cash distribution, Net worth, and Total assets are added in
alphabetical order to read as follows:
Sec. 1735.2 Definitions.
* * * * *
Cash distribution means investments, guarantees, extensions of
credit, advances, loans, non-affiliated company joint ventures, and
affiliated company investments. Not included in this definition are
qualified investments (see 7 CFR part 1744, subpart D).
* * * * *
Net worth has the meaning as defined in the mortgage with RUS.
* * * * *
Total assets has the meaning as defined in the mortgage with RUS.
3. In Sec. 1735.3, the first sentence is revised to read as
follows:
Sec. 1735.3 Availability of forms.
Single copies of RUS forms and publications cited in this part are
available from Program Support Regulatory Analysis, Rural Utilities
Service, STOP 1522, 1400 Independence Ave., SW., Washington, DC 20250-
1522. * * *
4. In Sec. 1735.17, paragraph (c) is revised to read as follows:
Sec. 1735.17 Facilities financed.
* * * * *
(c) RUS will not make any type of loan to finance the following
items:
(1) Station apparatus (including PBX and key systems) not owned by
the borrower and any associated inside wiring;
(2) Certain duplicative facilities, see Sec. 1735.12;
(3) Facilities to serve subscribers outside the local exchange
service area of the borrower unless those facilities are necessary to
furnishing or improving telecommunications service within the
borrower's service areas;
(4) Facilities to provide service other than 1-party; and
(5) System designs or facilities to provide service that cannot
withstand or are not designed to minimize damage caused by storms and
other natural catastrophes, including, but not limited to hurricanes,
floods, tornadoes, mudslides, lightning, windstorms, hail, fire, and
smoke.
* * * * *
5. In Sec. 1735.22, paragraph (g) is redesignated as new paragraph
(i), paragraph (f) is revised, and new paragraphs (g) and (h) are added
to read as follows:
Sec. 1735.22 Loan security.
* * * * *
(f) For purposes of determining compliance with TIER requirements,
unless a borrower whose existing mortgage contains TIER maintenance
requirements notifies RUS in writing differently, RUS will apply the
requirements described in paragraph (g) of this section to the borrower
regardless of the provisions of the borrower's existing mortgage.
(g) For loans approved after [effective date of final rule] loan
contracts and mortgages covering hardship loans, RUS cost-of-money
loans, RTB loans, and guaranteed loans will contain a provision
requiring the borrower to maintain a TIER of at least 1.0 during the
Forecast Period. At the end of the Forecast Period, the borrower shall
be required to maintain, at a minimum, a TIER at least equal to the
projected TIER determined by the feasibility study prepared in
connection with the loan, but at least 1.0 and not greater than 1.5.
(h) Nothing in this section shall affect any rights of supplemental
lenders under the RUS mortgage, or other creditors of the borrower, to
limit a borrower's TIER requirement to a level
[[Page 10487]]
above that established in paragraph (g) of this section.
* * * * *
6. In Sec. 1735.31, paragraphs (d) and (e) are redesignated as new
paragraphs (e) and (f), and new paragraph (d) is added to read as
follows:
Sec. 1735.31 RUS cost-of-money and RTB loans.
* * * * *
(d) Generally, no more than 10 percent of lending authority from
appropriations in any fiscal year for RUS cost-of-money and RTB loans
may be loaned to a single borrower. RUS will publish by notice in the
Federal Register the dollar limit that may be loaned to a single
borrower in that particular fiscal year based on approved RUS and RTB
lending authority.
* * * * *
7. Section 1735.33 is added to read as follows:
Sec. 1735.33 Variable interest rate loans.
After June 10, 1991, and prior to November 1, 1993, RUS made
certain variable rate loans at interest rates less than 5 percent but
not less than 2 percent. For those borrowers that received variable
rate loans, this section describes the method by which interest rates
are adjusted. The interest rate used in determining feasibility is the
rate charged to the borrower until the end of the Forecast Period for
that loan. At the end of the Forecast Period, the interest rate for the
loan may be annually adjusted by the Administrator upward to a rate not
greater than 5 percent, or downward to a rate not less than the rate
determined in the feasibility study on which the loan was based, based
on the borrower's ability to pay debt service and maintain a minimum
TIER of 1.0. Downward and upward adjustments will be rounded down to
the nearest one-half or whole percent. To make this adjustment,
projections set forth in the loan feasibility study will be revised
annually by RUS (beginning within four months after the end of the
Forecast Period) to reflect updated revenue and expense factors based
on the borrower's current operating condition. Any such adjustment will
be effective on July 1 of the year in which the adjustment was
determined. If the Administrator determines that the borrower is
capable of meeting the minimum TIER requirements of Sec. 1735.22(f) at
a loan interest rate of 5 percent on a loan made as described in this
section, then the loan interest rate shall be fixed, for the remainder
of the loan repayment period , at the standard interest rate of 5
percent.
8. In Sec. 1735.43, paragraph (a) is revised, paragraph (b) is
redesignated as new paragraph (f), and new paragraphs (b) through (e)
are added to read as follows:
Sec. 1735.43 Payments on Loans.
(a) Except as described in this paragraph (a), RUS loans approved
after [effective date of final rule] must be repaid with interest
within a period that, rounded to the nearest whole year, equals the
expected composite economic life of the facilities to be financed, as
calculated by RUS; expected composite economic life means the
depreciated life plus three years. The expected composite economic life
shall be based on the depreciation rates for the facilities financed by
the loan. In states where the borrower must obtain state regulatory
commission approval of depreciation rates, the depreciation rates used
shall be the rates currently approved by the state commission or rates
for which the borrower has received state commission approval. In cases
where a state regulatory commission does not approve depreciation
rates, the expected composite economic life shall be based on the most
recent median depreciation rates published by RUS for all borrowers
(see 7 CFR 1737.70). Borrowers may request a repayment period that is
longer or shorter than the expected composite economic life of the
facilities financed. If the Administrator determines that, if a shorter
period is likely to cause the borrower to experience hardship, the
Administrator may agree to approve a period longer than requested. A
shorter period may be approved as long as the Administrator determines
that the loan remains feasible.
(b) Borrowers with RTB loans approved after [effective date of
final rule] with a maturity that exceeds the expected composite
economic life of the facilities to be financed by the loan by a period
of more than three years, release of funds included in the loan shall
be conditioned upon the borrower establishing and maintaining, pursuant
to a plan approved by RUS, a funded reserve in such an amount that the
balance of the reserve plus the value of the facilities less
depreciation shall at all times be at least equal to the remaining
principal payments on the loan. Funding of the reserve must begin
within one year of approval of release of funds and must continue
regularly over the expected composite economic life of the facilities
financed.
(c) Borrowers that have demonstrated to the satisfaction of the
Administrator an inability to maintain the funded reserve or net plant
to secured debt ratio requirements, if any, contained in their
mortgage, may elect to replace notes with an original maturity that
exceeded the composite economic life of the facilities financed with
notes bearing a shorter maturity approximating the expected composite
economic life of the facilities financed, if this will result in a
shorter maturity for the loan. The principal balance of the notes
(hereinafter in this section called the ``refunding notes'') issued to
refund and substitute for the original notes would be the unpaid
principal balance of the original notes. The refunding notes would
mature at a date no later than the remaining economic life of the
facilities financed by the loan, plus three years. Interest on the
original note must continue to be paid through the closing date. All
other payment terms, including the rate of interest on the refunding
notes, would remain unchanged. Disposition of funds in the funded
reserve will be determined by RUS at the closing date. RUS will notify
the borrower in writing of the amendment of loan payment requirements
and the terms and conditions thereof.
(d) A borrower qualifying under paragraph (c) of this section shall
not be required to pay a prepayment premium on such portion of the
payments under its new notes as exceeds the payments required under the
notes being replaced.
(e) To apply for refunding notes, borrowers must send to the Area
Office the following:
(1) A certified copy of a board resolution requesting an amendment
of loan payment requirements and that certain notes be replaced;
(2) If applicable, evidence of approval by the regulatory body with
jurisdiction over the telecommunications service provided by the
borrower to issue refunding notes; and
(3) Such other documents as may be required by the RUS.
* * * * *
9. In Sec. 1735.46, paragraphs (b), (c) and (d) are revised,
paragraphs (e) and (f) are removed, and paragraphs (g) and (h) are
redesignated as paragraphs (e) and (f) to read as follows:
Sec. 1735.46 Loan security documents.
* * * * *
(b) Loan security documents of borrowers with loans approved after
[effective date of final rule] will provide limits on allowable cash
distributions in any calendar year as follows:
(1) No more than 25 percent of the prior calendar year's net
earnings or margins if the borrower's net worth is at
[[Page 10488]]
least 1 percent of its total assets after the distribution is made;
(2) No more than 50 percent of the prior calendar year's net
earnings or margins if the borrower's net worth is at least 20 percent
of its total assets after the distribution is made;
(3) No more than 75 percent of the prior calendar year's net
earnings or margins if the borrower's net worth is at least 30 percent
of its total assets after the distribution is made; or
(4) No limit on distributions if the borrower's net worth is at
least 40 percent of its total assets after the distribution is made.
(c) Borrowers that have not received a loan after [effective date
of final rule] may request the Administrator to apply these
requirements to them. Borrowers may request in writing that RUS
substitute the new requirements described in paragraphs (b)(1) through
(b)(4) of this section. Upon request by the borrower, the provisions of
the borrower's loan documents restricting cash distributions or
investments shall not be enforced to the extent that such provisions
are inconsistent with this section.
(d) Rural development investments meeting the criteria set forth in
7 CFR part 1744, subpart D, will not be counted against a borrower's
allowable cash distributions in any calendar year (7 U.S.C. 926).
* * * * *
Sec. 1735.60 [Amended]
10. Sec. 1735.60, paragraph (a) introductory text is amended by
removing the reference ``(see 7 CFR part 1758)'' and paragraph (a)(3)
is removed.
Sec. 1735.76 [Amended]
11. Sec. 1735.76, the second ``or'' is removed and the word ``of''
is added in its place.
PART 1737--PRE-LOAN POLICIES AND PROCEDURES COMMON TO INSURED AND
GUARANTEED TELECOMMUNICATIONS LOANS
12. The part heading for part 1737 is revised as set forth above.
13. The authority citation for part 1737 is revised to read as
follows:
Authority: 7 U.S.C. 901 et seq., 1921 et seq.; Pub. L. 103-354,
108 Stat. 3178 (7 U.S.C. 6941 et. seq.).
Sec. 1737.70 [Amended]
14. In Sec. 1737.70, paragraph (d) is removed and reserved.
PART 1739--[REMOVED]
15. Part 1739 is removed.
PART 1746--[REMOVED]
16. Part 1746 is removed.
Dated: February 24, 1997.
Jill Long Thompson,
Under Secretary, Rural Development.
[FR Doc. 97-5223 Filed 3-6-97; 8:45 am]
BILLING CODE 3410-15-P