The President is authorized to make loans to any local government which may suffer a substantial loss of tax and other revenues as a result of a major disaster, and has demonstrated a need for financial assistance in order to perform its governmental functions.
The amount of any such loan shall be based on need, shall not exceed—
(1) 25 percent of the annual operating budget of that local government for the fiscal year in which the major disaster occurs, and shall not exceed $5,000,000; or
(2) if the loss of tax and other revenues of the local government as a result of the major disaster is at least 75 percent of the annual operating budget of that local government for the fiscal year in which the major disaster occurs, 50 percent of the annual operating budget of that local government for the fiscal year in which the major disaster occurs, and shall not exceed $5,000,000.
Repayment of all or any part of such loan to the extent that revenues of the local government during the three full fiscal year period following the major disaster are insufficient to meet the operating budget of the local government, including additional disaster-related expenses of a municipal operation character shall be cancelled.
A local government shall not be eligible for further assistance under this section during any period in which the local government is in arrears with respect to a required repayment of a loan under this section.
Any loans made under this section shall not reduce or otherwise affect any grants or other assistance under this chapter.
(Pub. L. 93–288, title IV, §417, formerly §414(a), (b), May 22, 1974, 88 Stat. 158; renumbered §417, Pub. L. 100–707, title I, §106(j), Nov. 23, 1988, 102 Stat. 4705; Pub. L. 106–390, title II, §207, Oct. 30, 2000, 114 Stat. 1571; Pub. L. 109–347, title VI, §608, Oct. 13, 2006, 120 Stat. 1942.)
This chapter, referred to in subsec. (d), was in the original "this Act", meaning Pub. L. 93–288, May 22, 1974, 88 Stat. 143. For complete classification of this Act to the Code, see Short Title note set out under section 5121 of this title and Tables.
Prior to renumbering as section 417, section 414 of Pub. L. 93–288 contained a subsec. (c) which was repealed by Pub. L. 97–258, §5(b), Sept. 13, 1982, 96 Stat. 1082.
A prior section 417 of Pub. L. 93–288 was renumbered section 420 by Pub. L. 100–707 and is classified to section 5187 of this title.
2006—Subsec. (b). Pub. L. 109–347 substituted "exceed—
"(1) 25 percent"
for "exceed 25 per centum" and "; or" for period at end and added par. (2).
2000—Pub. L. 106–390, §207(1)–(3), designated first sentence of subsec. (a) as subsec. (a) and inserted subsec. heading, designated second sentence of subsec. (a) as subsec. (b) and inserted subsec. heading, and designated third sentence of subsec. (a) as subsec. (c)(1) and inserted subsec. and par. headings. Former subsec. (b) redesignated (d).
Subsec. (b). Pub. L. 106–390, §207(5), substituted "shall not exceed" for "and shall not exceed" and inserted before period at end ", and shall not exceed $5,000,000".
Subsec. (c)(2). Pub. L. 106–390, §207(6), added par. (2).
Subsec. (d). Pub. L. 106–390, §207(4), redesignated subsec. (b) as (d) and inserted subsec. heading.
Pub. L. 95–31, title I, May 23, 1977, 91 Stat. 169, provided: "That this Act be cited as the 'Community Emergency Drought Relief Act of 1977'.
"(b) The Secretary of Commerce may designate any area in the United States as an emergency drought impact area if he or she finds that a major and continuing adverse drought condition exists and is expected to continue, and such condition is causing significant hardships on the affected areas.
"(c) Eligible applicants shall be those States or political subdivisions of States with a population of ten thousand or more, Indian tribes, or public or private nonprofit organizations within areas designated pursuant to subsection (b) of this section.
"(d) Projects assisted under this Act shall be only those with respect to which assurances can be given to the satisfaction of the Secretary of Commerce that the work can be completed by April 30, 1978, or within such extended time as the Secretary may approve in exceptional circumstances.
"(b) Funds available to the Secretary for this Act shall be available for expenditure for drought impact projects conducted heretofore by eligible applicants during fiscal year 1977 if such projects are found to be compatible with the broad purposes of this Act."