Union Calendar No. 209

103D CONGRESS

1ST SESSION H. R. 3514

[Report No. 103–381]

A BILL

To clarify the regulatory oversight exercised by the

to certain electric borrowers.Rural Electrification Administration with respect

NOVEMBER 19, 1993

Committed to the Committee of the Whole House on the

State of the Union and ordered to be printed
IB

Union Calendar No. 209

103D CONGRESS

1ST SESSION H. R. 3514

[Report No. 103–381]

To clarify the regulatory oversight exercised by the Rural Electrification

Administration with respect to certain electric borrowers.

IN THE HOUSE OF REPRESENTATIVES

NOVEMBER 16, 1993

Mr. DE LA GARZA (for himself and Mr. ROBERTS) introduced the following

bill; which was referred to the Committee on Agriculture

NOVEMBER 19, 1993

Committed to the Committee of the Whole House on the State of the Union

and ordered to be printed

A BILL

To clarify the regulatory oversight exercised by the Rural

Electrification Administration with respect to certain

electric borrowers.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. ADMINISTRATIVE PROHIBITIONS APPLICABLE

2 TO CERTAIN ELECTRIC BORROWERS.

3 Section 306E of the Rural Electrification Act of 1936

4 is amended to read as follows:

5 ‘‘SEC. 306E. ADMINISTRATIVE PROHIBITIONS APPLICABLE

6 TO CERTAIN ELECTRIC BORROWERS.

7 ‘‘(a) IN GENERAL.—For the purpose of relieving bor8 rowers of unnecessary and burdensome requirements, the

9 Administrator, guided by the practices of private lenders

10 with respect to similar credit risks, shall issue regulations,

11 applicable to any electric borrower under this Act whose

12 net worth exceeds 110 percent of the outstanding principal

13 balance on all loans made or guaranteed to the borrower

14 by the Administrator, to minimize those approval rights,

15 requirements, restrictions, and prohibitions that the Ad16 ministrator otherwise may establish with respect to the op17 erations of such a borrower.

18 ‘‘(b) SUBORDINATION OR SHARING OF LIENS.—At

19 the request of a private lender providing financing to such

20 a borrower for a capital investment, the Administrator

21 shall, expeditiously, either offer to share the government’s

22 lien on the borrower’s system or offer to subordinate the

23 government’s lien on that property financed by the private

24 lender.

25 ‘‘(c) ISSUANCE OF REGULATIONS.—In issuing regu26 lations implementing this section, the Administrator may
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1 establish requirements, guided by the practices of private

2 lenders, to ensure that the security for any loan made or

3 guaranteed under this Act is reasonably adequate.

4 ‘‘(d) AUTHORITY OF THE ADMINISTRATOR.—Nothing

5 in this section limits the authority of the Administrator

6 to establish terms and conditions with respect to the use

7 by borrowers of the proceeds of loans made or guaranteed

8 under this Act or to take any other action specifically au9 thorized by law.’’.

10 SEC. 2. ISSUANCE OF REGULATIONS.

11 The Administrator of the Rural Electrification Ad12 ministration shall issue interim final regulations imple13 menting this Act not later than 180 days after enactment.

14 If the regulations are not issued within such period of

15 time, the Administrator may not, until the Administrator

16 issues such regulations, require prior approval of, establish

17 any requirement, restriction, or prohibition, with respect

18 to the operations of any electric borrower under the Rural

19 Electrification Act of 1936 whose net worth exceeds 100

20 percent of the outstanding principal balance on all loans

21 made or guaranteed to the borrower by the Administrator.