[Federal Register Volume 69, Number 27 (Tuesday, February 10, 2004)]
[Notices]
[Page 6251]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-2764]


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DEPARTMENT OF AGRICULTURE

Rural Utilities Service


Financing for Household Water Well Systems

AGENCY: Rural Utilities Service, USDA.

ACTION: Notice of inquiry.

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SUMMARY: The Water and Environmental Program within the Rural Utilities 
Service (RUS) is developing regulations to implement section 306E of 
the Consolidated Farm and Rural Development Act (CONACT). The Agency 
seeks written comments about the prospective grant program to an entity 
that will establish a lending program for the construction, 
refurbishing, and servicing of individually-owned household water well 
systems in rural areas that are or will be owned by the eligible 
individuals. RUS believes it is beneficial to have the public's input 
before drafting regulations and this notice of inquiry will allow the 
public's opinion to be considered in the drafting of those regulations.

DATES: Interested parties must submit written comments on or before 
March 11, 2004.

ADDRESSES: You may submit comments by any of the following methods:
     E-mail: [email protected]. Include in the 
subject line of the message ``Water Well Systems.'' The e-mail must 
identify, in the text of the message, the name of the individual (and 
name of the entity if applicable) who is submitting the comment.
     Mail: Addressed to Richard Annan, Acting 
Director, Program Development and Regulatory Analysis, Rural Utilities 
Service, United States Department of Agriculture, 1400 Independence 
Avenue, SW., STOP 1522, Washington, DC 20250-1522.
     Hand Delivery/Courier: Addressed to Richard 
Annan, Acting Director, Program Development and Regulatory Analysis, 
Rural Utilities Service, United States Department of Agriculture, 1400 
Independence Avenue, SW., Room 5168-S, Washington, DC 20250-1522
    RUS requires, in hard copy, a signed original and 3 copies of all 
written comments (7 CFR 1700.4). Comments will be available for public 
inspection during normal business hours (7 CFR part 1).

FOR FURTHER INFROMATION CONTACT: Gary Morgan, Assistant Administrator, 
Water and Environmental Programs, Rural Utilities Service, United 
States Department of Agriculture, 1400 Independence Avenue, SW., stop 
1548 room 5145-S, Washington, DC 20250-1548. Phone: 202-690-2670. Fax: 
202-720-0718. E-mail: [email protected].

SUPPLEMENTARY INFORMATION:

Background

    On May 13, 2002, the Farm Security and Rural Investment Act of 2002 
(Farm Bill) was signed into law as Public Law 107-171. The CONACT was 
amended by section 6012 of the Farm Bill, by adding a grant program to 
establish a lending program. For this program, the Secretary may make 
grants to private nonprofit organizations for the purpose of providing 
loans to eligible individuals for the construction, refurbishing, and 
servicing of individual household water well systems in rural areas 
that are or will be owned by the eligible individuals.
    An ``eligible individual'' means an individual who is a member of a 
household the members of which have a combined income (for the most 
recent 12-month period for which the information is available) that is 
not more than 100 percent of the median nonmetropolitan household 
income for the State or territory in which the individual resides, 
according to the most recent decennial census of the United States.
    The terms of a loan made with grant funds are as follows: (a) Shall 
have an interest rate of 1 percent; (b) shall have a term not to exceed 
20 years; and (c) shall not exceed $8,000 for each water well system.
    A recipient of a grant made under this section may use grant funds 
to pay administrative expenses associated with providing the assistance 
described in the above paragraph.
    The Secretary may give priority points to an applicant that has 
substantial expertise and experience in promoting the safe and 
productive use of individually-owned household water well systems and 
ground water.
    This program is authorized to be appropriated $10,000,000 for each 
of fiscal years (FY) 2003 through 2007.
    There was no funding appropriated in FY 2003. However, the 
appropriations bill for FY 2004 includes $500,000 for the grant 
program; therefore RUS is proceeding with the development of a 
regulation in order to implement the program.
    RUS encourages interested parties to review the Act in its entirety 
on the USDA Web site at http://www.usda.gov/farmbill/.

Request for Comment

    RUS is requesting comment and discussion on the following topics:
    1. RUS is interested in comments regarding grantees' experience 
with individual household water systems and the importance of having a 
staff with both technical and lending experience.
    2. In similar RD programs, there is either a requirement that the 
grantee provide matching funds or that the applicant receives 
additional priority for providing larger matching funds. Should there 
be a requirement to leverage funds? Also, should RUS give priority 
points to those who do leverage funds?
    3. What percentage of financing should be allowed and what 
percentage of the project costs should the borrower cover?
    4. Should administrative and servicing fees be an eligible grant 
purpose? If so, what should be the limit on those fees?
    5. RUS is considering the use of the Central Servicing Center for 
servicing the loans, including processing loan payments, reviewing 
financial statements, and other responsibilities involved in loan 
servicing.
    6. Several RD lending programs are limited to applicants who cannot 
obtain financing from commercial sources at reasonable rates and terms. 
How should the homeowner show an inability to obtain financing from 
other sources?
    7. What should be eligible and ineligible loan purposes?
    RUS invites interested parties including, but not limited to, 
financial and lending institutions, well drillers, trade associations, 
consumer groups and individuals to provide RUS, any information or 
analyses they believe to be relevant to the issues discussed in this 
Notice and to the implementation of the grant program.

    Dated: January 16, 2004.
Hilda Gay Legg,
Administrator, Rural Utilities Service.
[FR Doc. 04-2764 Filed 2-9-04; 8:45 am]
BILLING CODE 3410-15-P