Calendar No. 461

106TH CONGRESS

2D SESSION S. 2097

[Report No. 106–243]

A BILL

To authorize loan guarantees in order to facilitate

access to local television broadcast signals inunserved and underserved areas, and for otherpurposes.

MARCH 15, 2000

Reported with an amendment
II

Calendar No. 461

106TH CONGRESS

2D SESSION S. 2097

[Report No. 106–243]

To authorize loan guarantees in order to facilitate access to local television

broadcast signals in unserved and underserved areas, and for other purposes.

IN THE SENATE OF THE UNITED STATES

FEBRUARY 24, 2000

Mr. BURNS (for himself, Mr. GRAMM, Mr. LOTT, Mr. STEVENS, Mr. CRAPO,

Mr. HUTCHINSON, Mr. ALLARD, Mr. BUNNING, Ms. SNOWE, Ms. COLLINS, Mr. GRASSLEY, Mr. ENZI, Mr. THOMAS, Mr. HAGEL, Mr. LUGAR,

and Mr. COCHRAN) introduced the following bill; which was read twice

and referred to the Committee on Banking, Housing, and Urban Affairs

MARCH 15, 2000

Reported under authority of the order of the Senate of March 9, 2000, by

Mr. GRAMM, with an amendment

[Strike out all after the enacting clause and insert the part printed in italic]

A BILL

To authorize loan guarantees in order to facilitate access

to local television broadcast signals in unserved and underserved areas, and for other purposes.

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. SHORT TITLE.

2 This Act may be cited as the ‘‘Launching Our Com3 munities’ Access to Local Television Act of 2000’’.

4 SEC. 2. PURPOSE.

5 The purpose of this Act is to facilitate access, on a

6 technologically neutral basis and by December 31, 2006,

7 to signals of local television stations in unserved areas and

8 underserved areas for the households located in such areas

9 that seek access to such signals.

10 SEC. 3. LOCAL TELEVISION LOAN GUARANTEE BOARD.

11 (a) ESTABLISHMENT.—There is established the

12 LOCAL Television Loan Guarantee Board (in this Act re13 ferred to as the ‘‘Board’’).

14 (b) MEMBERS.—

15 (1) IN GENERAL.—Subject to paragraph (2),

16 the Board shall consist of the following members:

17 (A) The Secretary of the Treasury, or the

18 designee of the Secretary.

19 (B) The Chairman of the Board of Gov20 ernors of the Federal Reserve System, or the

21 designee of the Chairman.

22 (C) The Secretary of Agriculture, or the

23 designee of the Secretary.

24 (2) REQUIREMENT AS TO DESIGNEES.—An in25 dividual may not be designated a member of the

26 Board under paragraph (1) unless the individual is
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1 an officer of the United States pursuant to an ap2 pointment by the President, by and with the advice

3 and consent of the Senate.

4 (c) FUNCTIONS OF THE BOARD.—

5 (1) IN GENERAL.—The Board shall determine

6 whether or not to approve loan guarantees under

7 this Act. The Board shall make such determinations

8 consistent with the purpose of this Act and in ac9 cordance with this subsection and section 4.

10 (2) CONSULTATION AUTHORIZED.—

11 (A) IN GENERAL.—In carrying out its

12 functions under this Act, the Board shall con13 sult with such departments and agencies of the

14 Federal Government as the Board considers ap15 propriate, including the Department of Com16 merce, the Department of Agriculture, the De17 partment of the Treasury, the Department of

18 Justice, the Department of the Interior, the

19 Board of Governors of the Federal Reserve Sys20 tem, the Federal Communications Commission,

21 the Federal Trade Commission, and the Na22 tional Aeronautics and Space Administration.

23 (B) RESPONSE.—A department or agency

24 consulted by the Board under subparagraph (A)

25 shall provide the Board such expertise and as-
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1 sistance as the Board requires to carry out its

2 functions under this Act.

3 (3) APPROVAL BY MAJORITY VOTE.—The deter4 mination of the Board to approve a loan guarantee

5 under this Act shall be by a vote of a majority of

6 the Board.

7 SEC. 4. APPROVAL OF LOAN GUARANTEES.

8 (a) AUTHORITY TO APPROVE LOAN GUARANTEES.—

9 Subject to the provisions of this section and consistent

10 with the purpose of this Act, the Board may approve loan

11 guarantees under this Act

12 (b) REGULATIONS.—

13 (1) REQUIREMENTS.—The Board shall pre14 scribe regulations to implement the provisions of this

15 Act.

16 (2) ELEMENTS.—The regulations prescribed

17 under paragraph (1) shall—

18 (A) set forth the form of any application to

19 be submitted to the Board under this Act;

20 (B) set forth time periods for the review

21 and consideration by the Board of applications

22 to be submitted to the Board under this Act,

23 and for any other action to be taken by the

24 Board with respect to such applications;
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1 (C) provide appropriate safeguards against

2 the evasion of the provisions of this Act;

3 (D) set forth the circumstances in which

4 an applicant, together with any affiliate of an

5 applicant, shall be treated as an applicant for

6 a loan guarantee under this Act;

7 (E) include requirements that appropriate

8 parties submit to the Board any documents and

9 assurances that are required for the administra10 tion of the provisions of this Act; and

11 (F) include such other provisions con12 sistent with the purpose of this Act as the

13 Board considers appropriate.

14 (3) CONSTRUCTION.—(A) Nothing in this Act

15 shall be construed to prohibit the Board from requir16 ing, to the extent and under circumstances consid17 ered appropriate by the Board, that affiliates of an

18 applicant be subject to certain obligations of the ap19 plicant as a condition to the approval or mainte20 nance of a loan guarantee under this Act.

21 (B) If any provision of this Act or the applica22 tion of such provision to any person or entity or cir23 cumstance is held to be invalid by a court of com24 petent jurisdiction, the remainder of this Act, or the

25 application of such provision to such person or entity
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1 or circumstance other than those as to which it is

2 held invalid, shall not be affected thereby.

3 (c) AUTHORITY LIMITED BY APPROPRIATIONS

4 ACTS.—The Board may approve loan guarantees under

5 this Act only to the extent provided for in advance in ap6 propriations Acts.

7 (d) REQUIREMENTS AND CRITERIA APPLICABLE TO

8 APPROVAL.—

9 (1) IN GENERAL.—The Board shall utilize the

10 underwriting criteria developed under subsection (g),

11 and any relevant information provided by the de12 partments and agencies with which the Board

13 consults under section 3, to determine which loans

14 may be eligible for a loan guarantee under this Act.

15 (2) PREREQUISITES.—In addition to meeting

16 the underwriting criteria under paragraph (1), a

17 loan may not be guaranteed under this Act unless—

18 (A) the loan is made to finance the acqui19 sition, improvement, enhancement, construction,

20 deployment, launch, or rehabilitation of the

21 means by which local television broadcast sig22 nals will be delivered to an unserved area or un23 derserved area;

24 (B) the proceeds of the loan will not be

25 used for operating expenses;
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1 (C) the proposed project, as determined by

2 the Board in consultation with the National

3 Telecommunications and Information Adminis4 tration, is not likely to have a substantial ad5 verse impact on competition that outweighs the

6 benefits of improving access to the signals of a

7 local television station in an unserved area or

8 underserved area;

9 (D) the loan is provided by an insured de10 pository institution (as that term is defined in

11 section 3 of the Federal Deposit Insurance Act)

12 that is acceptable to the Board, and has terms,

13 in the judgment of the Board, that are con14 sistent in material respects with the terms of

15 similar obligations in the private capital mar16 ket;

17 (E) repayment of the loan is required to be

18 made within a term of the lesser of—

19 (i) 25 years from the date of the exe20 cution of the loan; or

21 (ii) the economically useful life, as de22 termined by the Board, of the primary as23 sets to be used in the delivery of the sig24 nals concerned; and
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1 (F) the loan meets any additional criteria

2 developed under subsection (g).

3 (3) PROTECTION OF UNITED STATES FINAN4 CIAL INTERESTS.—The Board may not approve the

5 guarantee of a loan under this Act unless—

6 (A) the Board has been given documenta7 tion, assurances, and access to information and

8 persons necessary, as determined by the Board,

9 to address issues relevant to the review of the

10 loan by the Board for purposes of this Act; and

11 (B) the Board makes a determination in

12 writing that—

13 (i) the assets, facilities, or equipment

14 covered by the loan will be utilized eco15 nomically and efficiently;

16 (ii) the terms, conditions, security,

17 and schedule and amount of repayments of

18 principal and the payment of interest with

19 respect to the loan protect the financial in20 terests of the United States and are rea21 sonable;

22 (iii) all necessary and required regu23 latory and other approvals, spectrum

24 rights, and delivery permissions have been
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1 received for the loan and the project under

2 the loan;

3 (iv) the loan would not be available on

4 reasonable terms and conditions without a

5 loan guarantee under this Act; and

6 (v) repayment of the loan can reason7 ably be expected.

8 (e) PRIORITY CONSIDERATIONS.—

9 (1) TYPE OF MARKET.—

10 (A) PRIORITY CONSIDERATION TO

11 UNSERVED AREAS.—To the maximum extent

12 practicable, the Board shall give priority in the

13 approval of loan guarantees under this Act for

14 projects that will serve unserved areas.

15 (B) PROHIBITION.—The Board may not

16 approve a loan guarantee under this Act for a

17 project that is designed primarily to serve one

18 or more of the 40 most populated designated

19 market areas (as that term is defined in section

20 122(j) of title 17, United States Code).

21 (2) PROJECTS THAT WOULD REDUCE CON22 SUMER COSTS.—To the maximum extent practicable,

23 the Board shall also give priority in the approval of

24 loan guarantees under this Act to projects that

25 would—
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1 (A) offer a separate tier of local broadcast

2 signals, but for applicable Federal, State, or

3 local laws or regulations;

4 (B) provide lower projected costs to con5 sumers of such separate tier; and

6 (C) enable the delivery of local broadcast

7 signals consistent with the purpose of this Act

8 by a means reasonably compatible with existing

9 systems or devices predominantly in use.

10 (f) GUARANTEE LIMITS.—

11 (1) LIMITATION ON AGGREGATE VALUE OF

12 LOANS.—The aggregate value of all loans for which

13 loan guarantees are issued under this Act may not

14 exceed $1,250,000,000.

15 (2) GUARANTEE LEVEL.—A loan guarantee

16 issued under this Act may not exceed an amount

17 equal to 70 percent of a loan meeting in its entirety

18 the requirements of subsection (d)(2)(A). If only a

19 portion of a loan meets the requirements of that

20 subsection, the Board shall determine that percent21 age of the loan meeting such requirements (the ‘‘ap22 plicable portion’’) and may issue a loan guarantee

23 in an amount not exceeding 70 percent of the appli24 cable portion.
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1 (g) UNDERWRITING CRITERIA.—Not later than 180

2 days after the date of the enactment of this Act, the Board

3 shall, in consultation with the Director of the Office of

4 Management and Budget and an independent public ac5 counting firm, develop underwriting criteria relating to the

6 guarantee of loans that are consistent with the purpose

7 of this Act, including appropriate collateral and cash flow

8 levels for loans guaranteed under this Act, and such other

9 matters as the Board considers appropriate.

10 (h) CREDIT RISK PREMIUMS.—

11 (1) ESTABLISHMENT AND ACCEPTANCE.—

12 (A) AUTHORITY.—The Board may estab13 lish and approve the acceptance of credit risk

14 premiums with respect to a loan guarantee

15 under this Act in order to cover the cost, as de16 termined under section 504(b)(1) of the Fed17 eral Credit Reform Act of 1990, of the loan

18 guarantee. To the extent that appropriations of

19 budget authority are insufficient to cover the

20 cost, as so determined, of a loan guarantee

21 under this Act, credit risk premiums shall be

22 accepted from a non-Federal source under this

23 subsection on behalf of the applicant for the

24 loan guarantee.

25 (2) CREDIT RISK PREMIUM AMOUNT.—
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1 (A) IN GENERAL.—The Board shall deter2 mine the amount of any credit risk premium to

3 be accepted with respect to a loan guarantee

4 under this Act on the basis of—

5 (i) the financial and economic cir6 cumstances of the applicant for the loan

7 guarantee, including the amount of collat8 eral offered;

9 (ii) the proposed schedule of loan dis10 bursements;

11 (iii) the business plans of the appli12 cant for providing service;

13 (iv) any financial commitment from a

14 broadcast signal provider; and

15 (v) the concurrence of the Director of

16 the Office of Management and Budget as

17 to the amount of the credit risk premium.

18 (B) PROPORTIONALITY.—To the extent

19 that appropriations of budget authority are suf20 ficient to cover the cost, as determined under

21 section 504(b)(1) of the Federal Credit Reform

22 Act of 1990, of loan guarantees under this Act,

23 the credit risk premium with respect to each

24 loan guarantee shall be reduced proportionately.
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1 (i) JUDICIAL REVIEW.—The decision of the Board to

2 approve or disapprove the making of a loan guarantee

3 under this Act shall not be subject to judicial review.

4 SEC. 5. ADMINISTRATION OF LOAN GUARANTEES.

5 (a) IN GENERAL.—The Administrator of the Rural

6 Utilities Service (in this Act referred to as the ‘‘Adminis7 trator’’) shall issue and otherwise administer loan guaran8 tees that have been approved by the Board in accordance

9 with sections 3 and 4 of this Act.

10 (b) SECURITY FOR PROTECTION OF UNITED STATES

11 FINANCIAL INTERESTS.—

12 (1) TERMS AND CONDITIONS.—An applicant

13 shall agree to such terms and conditions as are sat14 isfactory, in the judgment of the Board, to ensure

15 that, as long as any principal or interest is due and

16 payable on a loan guaranteed under this Act, the

17 applicant—

18 (A) shall maintain assets, equipment, fa19 cilities, and operations on a continuing basis;

20 (B) shall not make any discretionary divi21 dend payments that impair its ability to repay

22 obligations guaranteed under this Act; and

23 (C) shall remain sufficiently capitalized.

24 (2) COLLATERAL.—
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1 (A) EXISTENCE OF ADEQUATE COLLAT2 ERAL.—An applicant shall provide the Board

3 such documentation as is necessary, in the

4 judgment of the Board, to provide satisfactory

5 evidence that appropriate and adequate collat6 eral secures a loan guaranteed under this Act.

7 (B) FORM OF COLLATERAL.—Collateral re8 quired by subparagraph (A) shall consist solely

9 of assets of the applicant, any affiliate of the

10 applicant, or both (whichever the Board con11 siders appropriate), including primary assets to

12 be used in the delivery of signals for which the

13 loan is guaranteed.

14 (C) REVIEW OF VALUATION.—The value of

15 collateral securing a loan guaranteed under this

16 Act may be reviewed by the Board, and may be

17 adjusted downward by the Board if the Board

18 reasonably believes such adjustment is appro19 priate.

20 (3) LIEN ON INTERESTS IN ASSETS.—Upon the

21 Board’s approval of a loan guarantee under this Act,

22 the Administrator shall have liens on assets securing

23 the loan, which shall be superior to all other liens on

24 such assets, and the value of the assets (based on

25 a determination satisfactory to the Board) subject to
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1 the liens shall be at least equal to the unpaid bal2 ance of the loan amount covered by the loan guar3 antee.

4 (4) PERFECTED SECURITY INTEREST.—With

5 respect to a loan guaranteed under this Act, the Ad6 ministrator and the lender shall have a perfected se7 curity interest in assets securing the loan that are

8 fully sufficient to protect the financial interests of

9 the United States and the lender.

10 (5) INSURANCE.—In accordance with practices

11 in the private capital market, as determined by the

12 Board, the applicant for a loan guarantee under this

13 Act shall obtain, at its expense, insurance sufficient

14 to protect the financial interests of the United

15 States, as determined by the Board.

16 (c) ASSIGNMENT OF LOAN GUARANTEES.—The hold17 er of a loan guarantee under this Act may assign the loan

18 guaranteed under this Act in whole or in part, subject to

19 such requirements as the Board may prescribe.

20 (d) MODIFICATION.—The Board may approve the

21 modification of any term or condition of a loan guarantee

22 under this Act, including the rate of interest, time of pay23 ment of principal or interest, or security requirements only

24 if—
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1 (1) the modification is consistent with the fi2 nancial interests of the United States;

3 (2) consent has been obtained from the parties

4 to the loan agreement;

5 (3) the modification is consistent with the un6 derwriting criteria developed under section 4(g);

7 (4) the modification does not adversely affect

8 the interest of the Federal Government in the assets

9 or collateral of the applicant;

10 (5) the modification does not adversely affect

11 the ability of the applicant to repay the loan; and

12 (6) the National Telecommunications and Infor13 mation Administration has been consulted by the

14 Board regarding the modification.

15 (e) PERFORMANCE SCHEDULES.—

16 (1) PERFORMANCE SCHEDULES.—An applicant

17 for a loan guarantee under this Act for a project

18 covered by section 4(e)(1) shall enter into stipulated

19 performance schedules with the Administrator with

20 respect to the signals to be provided through the

21 project.

22 (2) PENALTY.—The Administrator may assess

23 against and collect from an applicant described in

24 paragraph (1) a penalty not to exceed 3 times the

25 interest due on the guaranteed loan of the applicant
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1 under this Act if the applicant fails to meet its stip2 ulated performance schedule under that paragraph.

3 (f) COMPLIANCE.—The Administrator, in cooperation

4 with the Board and as the regulations of the Board may

5 provide, shall enforce compliance by an applicant, and any

6 other party to a loan guarantee for whose benefit assist7 ance under this Act is intended, with the provisions of this

8 Act, any regulations under this Act, and the terms and

9 conditions of the loan guarantee, including through the

10 submittal of such reports and documents as the Board

11 may require in regulations prescribed by the Board and

12 through regular periodic inspections and audits.

13 (g) COMMERCIAL VALIDITY.—A loan guarantee

14 under this Act shall be incontestable—

15 (1) in the hands of an applicant on whose be16 half the loan guarantee is made, unless the applicant

17 engaged in fraud or misrepresentation in securing

18 the loan guarantee; and

19 (2) as to any person or entity (or their respec20 tive successor in interest) who makes or contracts to

21 make a loan to the applicant for the loan guarantee

22 in reliance thereon, unless such person or entity (or

23 respective successor in interest) engaged in fraud or

24 misrepresentation in making or contracting to make

25 such loan.
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1 (h) DEFAULTS.—The Board shall prescribe regula2 tions governing defaults on loans guaranteed under this

3 Act, including the administration of the payment of guar4 anteed amounts upon default.

5 (i) RECOVERY OF PAYMENTS.—

6 (1) IN GENERAL.—The Administrator shall be

7 entitled to recover from an applicant for a loan

8 guarantee under this Act the amount of any pay9 ment made to the holder of the guarantee with re10 spect to the loan.

11 (2) SUBROGATION.—Upon making a payment

12 described in paragraph (1), the Administrator shall

13 be subrogated to all rights of the party to whom the

14 payment is made with respect to the guarantee

15 which was the basis for the payment.

16 (3) DISPOSITION OF PROPERTY.—

17 (A) SALE OR DISPOSAL.—The Adminis18 trator shall, in an orderly and efficient manner,

19 sell or otherwise dispose of any property or

20 other interests obtained under this Act in a

21 manner that maximizes taxpayer return and is

22 consistent with the financial interests of the

23 United States.

24 (B) MAINTENANCE.—The Administrator

25 shall maintain in a cost-effective and reasonable
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1 manner any property pending sale or disposal

2 of such property under subparagraph (A).

3 (j) ACTION AGAINST OBLIGOR.—

4 (1) AUTHORITY TO BRING CIVIL ACTION.—The

5 Administrator may bring a civil action in an appro6 priate district court of the United States in the

7 name of the United States or of the holder of the

8 obligation in the event of a default on a loan guar9 anteed under this Act. The holder of a loan guar10 antee shall make available to the Administrator all

11 records and evidence necessary to prosecute the civil

12 action.

13 (2) FULLY SATISFYING OBLIGATIONS OWED

14 THE UNITED STATES.—The Administrator may ac15 cept property in satisfaction of any sums owed the

16 United States as a result of a default on a loan

17 guaranteed under this Act, but only to the extent

18 that any cash accepted by the Administrator is not

19 sufficient to satisfy fully the sums owed as a result

20 of the default.

21 (k) BREACH OF CONDITIONS.—The Administrator

22 shall commence a civil action in a court of appropriate

23 jurisdiction to enjoin any activity which the Board finds

24 is in violation of this Act, the regulations under this Act,

25 or any conditions which were duly agreed to, and to secure
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1 any other appropriate relief, including relief against any

2 affiliate of the applicant.

3 (l) ATTACHMENT.—No attachment or execution may

4 be issued against the Administrator or any property in the

5 control of the Administrator pursuant to this Act before

6 the entry of a final judgment (as to which all rights of

7 appeal have expired) by a State, Federal, or other court

8 of competent jurisdiction against the Administrator in a

9 proceeding for such action.

10 (m) FEES.—

11 (1) APPLICATION FEE.—The Board may charge

12 and collect from an applicant for a loan guarantee

13 under this Act a fee to cover the cost of the Board

14 in making necessary determinations and findings

15 with respect to the loan guarantee application under

16 this Act. The amount of the fee shall be reasonable.

17 (2) LOAN GUARANTEE ORIGINATION FEE.—The

18 Board may charge, and the Administrator may col19 lect, a loan guarantee origination fee with respect to

20 the issuance of a loan guarantee under this Act.

21 (3) USE OF FEES COLLECTED.—Any fee col22 lected under this subsection shall be used to offset

23 administrative costs under this Act, including costs

24 of the Board and of the Administrator.

25 (n) REQUIREMENTS RELATING TO AFFILIATES.—
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1 (1) INDEMNIFICATION.—An affiliate of an ap2 plicant for a loan guarantee under this Act shall in3 demnify the United States for any losses that the

4 United States incurs as a result of—

5 (A) a judgment against the applicant or

6 any of its affiliates;

7 (B) any breach by the applicant or any of

8 its affiliates of their obligations under the loan

9 guarantee agreement;

10 (C) any violation of the provisions of this

11 Act, and the regulations prescribed under this

12 Act, by the applicant or any of its affiliates;

13 (D) any penalties incurred by the applicant

14 or any of its affiliates for any reason, including

15 violation of a stipulated performance schedule

16 under subsection (e); and

17 (E) any other circumstances that the

18 Board considers appropriate.

19 (2) LIMITATION ON TRANSFER OF LOAN PRO20 CEEDS.—An applicant for a loan guarantee under

21 this Act may not transfer any part of the proceeds

22 of the loan to an affiliate.

23 (o) EFFECT OF BANKRUPTCY.—(1) Notwithstanding

24 any other provision of law, whenever any person or entity

25 is indebted to the United States as a result of any loan
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1 guarantee issued under this Act and such person or entity

2 is insolvent or is a debtor in a case under title 11, United

3 States Code, the debts due to the United States shall be

4 satisfied first.

5 (2) A discharge in bankruptcy under title 11, United

6 States Code, shall not release a person or entity from an

7 obligation to the United States in connection with a loan

8 guarantee under this Act.

9 SEC. 6. ANNUAL AUDIT.

10 (a) REQUIREMENT.—The Comptroller General of the

11 United States shall conduct on an annual basis an audit

12 of the administration of the provisions of this Act.

13 (b) REPORT.—The Comptroller General shall submit

14 to the Committee on Banking, Housing, and Urban Af15 fairs of the Senate and the Committee on Banking and

16 Financial Services of the House of Representatives a re17 port on each audit conducted under subsection (a).

18 SEC. 7. SUNSET.

19 No loan guarantee may be approved under this Act

20 after December 31, 2006.

21 SEC. 8. RETRANSMISSION OF LOCAL TELEVISION BROAD22 CAST STATIONS.

23 An applicant shall be subject to applicable rights, ob24 ligations, and limitations of title 17, United States Code.

25 If a local broadcast station requests carriage of its signal
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1 and is located in a market not served by a satellite carrier

2 providing service under a statutory license under section

3 122 of title 17, United States Code, the applicant shall

4 carry the signal of that station without charge, and shall

5 be subject to the applicable rights, obligations, and limita6 tions of sections 338, 614, and 615 of the Communica7 tions Act of 1934.

8 SEC. 9. DEFINITIONS.

9 In this Act:

10 (1) AFFILIATE.—The term ‘‘affiliate’’—

11 (A) means any person or entity that con12 trols, or is controlled by, or is under common

13 control with, another person or entity; and

14 (B) may include any individual who is a di15 rector or senior management officer of an affil16 iate, a shareholder controlling more than 25

17 percent of the voting securities of an affiliate,

18 or more than 25 percent of the ownership inter19 est in an affiliate not organized in stock form.

20 (2) UNSERVED AREA.—The term ‘‘unserved

21 area’’ means any area (as determined using stand22 ards employed by the Federal Communications Com23 mission) that—
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1 (A) is outside the grade B contour of the

2 local television broadcast signals serving a par3 ticular dominant market area; and

4 (B) does not have access to such signals by

5 other widely marketed means.

6 (3) UNDERSERVED AREA.—The term ‘‘under7 served area’’ means any area that does not receive

8 local television broadcast signals over a commercial

9 for-profit direct-to-home satellite distribution system.

10 (4) COMMON TERMS.—Except as provided in

11 paragraphs (1) through (3), any term used in this

12 Act that is defined in the Communications Act of

13 1934 (47 U.S.C. 151 et seq.) has the meaning given

14 that term in the Communications Act of 1934.

15 SEC. 10. AUTHORIZATIONS OF APPROPRIATIONS.

16 (a) COST OF LOAN GUARANTEES.—For the cost of

17 the loans guaranteed under this Act, including the cost

18 of modifying the loans, as defined in section 502 of the

19 Congressional Budget Act of 1974 (2 U.S.C. 661(a)),

20 there are authorized to be appropriated for fiscal years

21 2001 through 2006, such amounts as may be necessary.

22 (b) COST OF ADMINISTRATION.—There is hereby au23 thorized to be appropriated such sums as may be nec24 essary to carry out the provisions of this Act, other than

25 to cover costs under subsection (a).
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1 (c) AVAILABILITY.—Any amounts appropriated pur2 suant to the authorizations of appropriations in sub3 sections (a) and (b) shall remain available until expended.

4 SECTION 1. SHORT TITLE.

5 This Act may be cited as the ‘‘Launching Our Commu6 nities’ Access to Local Television Act of 2000’’.

7 SEC. 2. PURPOSE.

8 The purpose of this Act is to facilitate access, on a

9 technologically neutral basis and by December 31, 2006, to

10 signals of local television stations for households located in

11 unserved areas and underserved areas.

12 SEC. 3. LOCAL TELEVISION LOAN GUARANTEE BOARD.

13 (a) ESTABLISHMENT.—There is established the

14 LOCAL Television Loan Guarantee Board (in this Act re15 ferred to as the ‘‘Board’’).

16 (b) MEMBERS.—

17 (1) IN GENERAL.—Subject to paragraph (2), the

18 Board shall consist of the following members:

19 (A) The Secretary of the Treasury, or the

20 designee of the Secretary.

21 (B) The Chairman of the Board of Gov22 ernors of the Federal Reserve System, or the des23 ignee of the Chairman.

24 (C) The Secretary of Agriculture, or the des25 ignee of the Secretary.
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1 (2) REQUIREMENT AS TO DESIGNEES.—An indi2 vidual may not be designated a member of the Board

3 under paragraph (1) unless the individual is an offi4 cer of the United States pursuant to an appointment

5 by the President, by and with the advice and consent

6 of the Senate.

7 (c) FUNCTIONS OF THE BOARD.—

8 (1) IN GENERAL.—The Board shall determine

9 whether or not to approve loan guarantees under this

10 Act. The Board shall make such determinations con11 sistent with the purpose of this Act and in accordance

12 with this subsection and section 4 of this Act.

13 (2) CONSULTATION AUTHORIZED.—

14 (A) IN GENERAL.—In carrying out its func15 tions under this Act, the Board shall consult

16 with such departments and agencies of the Fed17 eral Government as the Board considers appro18 priate, including the Department of Commerce,

19 the Department of Agriculture, the Department

20 of the Treasury, the Department of Justice, the

21 Department of the Interior, the Board of Gov22 ernors of the Federal Reserve System, the Federal

23 Communications Commission, the Federal Trade

24 Commission, and the National Aeronautics and

25 Space Administration.
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1 (B) RESPONSE.—A department or agency

2 consulted by the Board under subparagraph (A)

3 shall provide the Board such expertise and as4 sistance as the Board requires to carry out its

5 functions under this Act.

6 (3) APPROVAL BY MAJORITY VOTE.—The deter7 mination of the Board to approve a loan guarantee

8 under this Act shall be by a vote of a majority of the

9 Board.

10 SEC. 4. APPROVAL OF LOAN GUARANTEES.

11 (a) AUTHORITY TO APPROVE LOAN GUARANTEES.—

12 Subject to the provisions of this section and consistent with

13 the purpose of this Act, the Board may approve loan guar14 antees under this Act.

15 (b) REGULATIONS.—

16 (1) REQUIREMENTS.—The Administrator (as de17 fined in section 5 of this Act), under the direction of

18 and for approval by the Board, shall prescribe regula19 tions to implement the provisions of this Act and

20 shall do so not later than 120 days after funds au21 thorized to be appropriated under section 10 of this

22 Act have been appropriated in a bill signed into law.

23 (2) ELEMENTS.—The regulations prescribed

24 under paragraph (1) shall—
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1 (A) set forth the form of any application to

2 be submitted to the Board under this Act;

3 (B) set forth time periods for the review and

4 consideration by the Board of applications to be

5 submitted to the Board under this Act, and for

6 any other action to be taken by the Board with

7 respect to such applications;

8 (C) provide appropriate safeguards against

9 the evasion of the provisions of this Act;

10 (D) set forth the circumstances in which an

11 applicant, together with any affiliate of an ap12 plicant, shall be treated as an applicant for a

13 loan guarantee under this Act;

14 (E) include requirements that appropriate

15 parties submit to the Board any documents and

16 assurances that are required for the administra17 tion of the provisions of this Act; and

18 (F) include such other provisions consistent

19 with the purpose of this Act as the Board con20 siders appropriate.

21 (3) CONSTRUCTION.—(A) Nothing in this Act

22 shall be construed to prohibit the Board from requir23 ing, to the extent and under circumstances considered

24 appropriate by the Board, that affiliates of an appli25 cant be subject to certain obligations of the applicant
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•S 2097 RS

1 as a condition to the approval or maintenance of a

2 loan guarantee under this Act.

3 (B) If any provision of this Act or the applica4 tion of such provision to any person or entity or cir5 cumstance is held to be invalid by a court of com6 petent jurisdiction, the remainder of this Act, or the

7 application of such provision to such person or entity

8 or circumstance other than those as to which it is held

9 invalid, shall not be affected thereby.

10 (c) AUTHORITY LIMITED BY APPROPRIATIONS ACTS.—

11 The Board may approve loan guarantees under this Act

12 only to the extent provided for in advance in appropria13 tions Acts. The Board may delegate to the Administrator

14 (as defined in section 5 of this Act) the authority to approve

15 loan guarantees of up to $20,000,000. To the extent the Ad16 ministrator is delegated such authority, the Administrator

17 shall comply with the terms of this Act applicable to the

18 Board.

19 (d) REQUIREMENTS AND CRITERIA APPLICABLE TO

20 APPROVAL.—

21 (1) IN GENERAL.—The Board shall utilize the

22 underwriting criteria developed under subsection (g),

23 and any relevant information provided by the depart24 ments and agencies with which the Board consults
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1 under section 3, to determine which loans may be eli2 gible for a loan guarantee under this Act.

3 (2) PREREQUISITES.—In addition to meeting the

4 underwriting criteria under paragraph (1), a loan

5 may not be guaranteed under this Act unless—

6 (A) the loan is made to finance the acquisi7 tion, improvement, enhancement, construction,

8 deployment, launch, or rehabilitation of the

9 means by which local television broadcast signals

10 will be delivered to an unserved area or under11 served area;

12 (B) the proceeds of the loan will not be used

13 for operating expenses;

14 (C) the proposed project, as determined by

15 the Board in consultation with the National

16 Telecommunications and Information Adminis17 tration, is not likely to have a substantial ad18 verse impact on competition that outweighs the

19 benefits of improving access to the signals of a

20 local television station in an unserved area or

21 underserved area;

22 (D) the loan is provided by an insured de23 pository institution (as that term is defined in

24 section 3 of the Federal Deposit Insurance Act)

25 that is acceptable to the Board, and has terms,
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•S 2097 RS

1 in the judgment of the Board, that are consistent

2 in material respects with the terms of similar ob3 ligations in the private capital market;

4 (E) repayment of the loan is required to be

5 made within a term of the lesser of—

6 (i) 25 years from the date of the execu7 tion of the loan; or

8 (ii) the economically useful life, as de9 termined by the Board or in consultation

10 with persons or entities deemed appropriate

11 by the Board, of the primary assets to be

12 used in the delivery of the signals con13 cerned; and

14 (F) the loan meets any additional criteria

15 developed under subsection (g).

16 (3) PROTECTION OF UNITED STATES FINANCIAL

17 INTERESTS.—The Board may not approve the guar18 antee of a loan under this Act unless—

19 (A) the Board has been given documenta20 tion, assurances, and access to information, per21 sons, and entities necessary, as determined by

22 the Board, to address issues relevant to the re23 view of the loan by the Board for purposes of

24 this Act; and
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1 (B) the Board makes a determination in

2 writing that—

3 (i) to the best of its knowledge upon

4 due inquiry, the assets, facilities, or equip5 ment covered by the loan will be utilized

6 economically and efficiently;

7 (ii) the terms, conditions, security, and

8 schedule and amount of repayments of prin9 cipal and the payment of interest with re10 spect to the loan protect the financial inter11 ests of the United States and are reasonable;

12 (iii) to the extent possible, the value of

13 collateral provided by an applicant is at

14 least equal to the unpaid balance of the loan

15 amount covered by the loan guarantee (the

16 ‘‘Amount’’ for purposes of this clause); and

17 if the value of collateral provided by an ap18 plicant is less than the Amount, the addi19 tional required collateral is provided by any

20 affiliate of the applicant; and if the com21 bined value of collateral provided by an ap22 plicant and any affiliate is not at least

23 equal to the Amount, the collateral from

24 such affiliate represents all of such affili25 ate’s assets;
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•S 2097 RS

1 (iv) all necessary and required regu2 latory and other approvals, spectrum rights,

3 and delivery permissions have been received

4 for the loan, the project under the loan, and

5 the Other Debt, if any, under subsection

6 (f)(2)(B);

7 (v) the loan would not be available on

8 reasonable terms and conditions without a

9 loan guarantee under this Act; and

10 (vi) repayment of the loan can reason11 ably be expected.

12 (e) CONSIDERATIONS.—

13 (1) TYPE OF MARKET.—

14 (A) PRIORITY CONSIDERATIONS.—To the

15 maximum extent practicable, the Board shall

16 give priority in the approval of loan guarantees

17 under this Act in the following order: First, to

18 projects that will serve the greatest number of

19 households in unserved areas; and second, to

20 projects that will serve the greatest number of

21 households in underserved areas. In each in22 stance, the Board shall consider the project’s esti23 mated cost per household to be served.

24 (B) PROHIBITION.—The Board may not ap25 prove a loan guarantee under this Act for a
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1 project that is designed primarily to serve 1 or

2 more of the 40 most populated designated market

3 areas (as that term is defined in section 122(j)

4 of title 17, United States Code).

5 (2) OTHER CONSIDERATIONS.—The Board shall

6 consider other factors, which shall include projects

7 that would—

8 (A) offer a separate tier of local broadcast

9 signals, but for applicable Federal, State, or

10 local laws or regulations;

11 (B) provide lower projected costs to con12 sumers of such separate tier; and

13 (C) enable the delivery of local broadcast

14 signals consistent with the purpose of this Act by

15 a means reasonably compatible with existing

16 systems or devices predominantly in use.

17 (f) GUARANTEE LIMITS.—

18 (1) LIMITATION ON AGGREGATE VALUE OF

19 LOANS.—The aggregate value of all loans for which

20 loan guarantees are issued under this Act (including

21 the unguaranteed portion of loans issued under para22 graph (2)(A)) and Other Debt under paragraph

23 (2)(B) may not exceed $1,250,000,000.

24 (2) GUARANTEE LEVEL.—A loan guarantee

25 issued under this Act—
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1 (A) may not exceed an amount equal to 80

2 percent of a loan meeting in its entirety the re3 quirements of subsection (d)(2)(A). If only a por4 tion of a loan meets the requirements of that sub5 section, the Board shall determine that percent6 age of the loan meeting such requirements (the

7 ‘‘applicable portion’’) and may issue a loan

8 guarantee in an amount not exceeding 80 per9 cent of the applicable portion; or

10 (B) may, as to a loan meeting in its en11 tirety the requirements of subsection (d)(2)(A),

12 cover the amount of such loan only if that loan

13 is for an amount not exceeding 80 percent of the

14 total debt financing for the project, and other

15 debt financing (also meeting in its entirety the

16 requirements of subsection (d)(2)(A)) from the

17 same source for a total amount not less than 20

18 percent of the total debt financing for the project

19 (‘‘Other Debt’’) has been approved.

20 (g) UNDERWRITING CRITERIA.—Within the period

21 provided for under subsection (b)(1), the Board shall, in

22 consultation with the Director of the Office of Management

23 and Budget and an independent public accounting firm,

24 develop underwriting criteria relating to the guarantee of

25 loans that are consistent with the purpose of this Act, in-
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•S 2097 RS

1 cluding appropriate collateral and cash flow levels for loans

2 guaranteed under this Act, and such other matters as the

3 Board considers appropriate.

4 (h) CREDIT RISK PREMIUMS.—

5 (1) ESTABLISHMENT AND ACCEPTANCE.—The

6 Board may establish and approve the acceptance of

7 credit risk premiums with respect to a loan guarantee

8 under this Act in order to cover the cost, as deter9 mined under section 504(b)(1) of the Federal Credit

10 Reform Act of 1990, of the loan guarantee. To the ex11 tent that appropriations of budget authority are in12 sufficient to cover the cost, as so determined, of a loan

13 guarantee under this Act, credit risk premiums shall

14 be accepted from a non-Federal source under this sub15 section on behalf of the applicant for the loan guar16 antee.

17 (2) CREDIT RISK PREMIUM AMOUNT.—

18 (A) IN GENERAL.—The Board shall deter19 mine the amount of any credit risk premium to

20 be accepted with respect to a loan guarantee

21 under this Act on the basis of—

22 (i) the financial and economic cir23 cumstances of the applicant for the loan

24 guarantee, including the amount of collat25 eral offered;
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•S 2097 RS

1 (ii) the proposed schedule of loan dis2 bursements;

3 (iii) the business plans of the applicant

4 for providing service;

5 (iv) any financial commitment from a

6 broadcast signal provider; and

7 (v) the concurrence of the Director of

8 the Office of Management and Budget as to

9 the amount of the credit risk premium.

10 (B) PROPORTIONALITY.—To the extent that

11 appropriations of budget authority are sufficient

12 to cover the cost, as determined under section

13 504(b)(1) of the Federal Credit Reform Act of

14 1990, of loan guarantees under this Act, the

15 credit risk premium with respect to each loan

16 guarantee shall be reduced proportionately.

17 (C) PAYMENT OF PREMIUMS.—Credit risk

18 premiums under this subsection shall be paid to

19 an account (the ‘‘Escrow Account’’) established

20 in the Treasury which shall accrue interest and

21 such interest shall be retained by the account,

22 subject to subparagraph (D).

23 (D) DEDUCTIONS FROM ESCROW AC24 COUNT.—If a default occurs with respect to any

25 loan guaranteed under this Act and the default
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•S 2097 RS

1 is not cured in accordance with the terms of the

2 underlying loan or loan guarantee agreement,

3 the Administrator, in accordance with sub4 sections (h) and (i) of section 5 of this Act, shall

5 liquidate, or shall cause to be liquidated, all as6 sets collateralizing such loan as to which it has

7 a lien or security interest. Any shortfall between

8 the proceeds of the liquidation net of costs and

9 expenses relating to the liquidation, and the

10 guarantee amount paid pursuant to this Act

11 shall be deducted from funds in the Escrow Ac12 count and credited to the Administrator for pay13 ment of such shortfall. At such time as deter14 mined under subsection (d)(2)(E) when all loans

15 guaranteed under this Act have been repaid or

16 otherwise satisfied in accordance with this Act

17 and the regulations promulgated hereunder, re18 maining funds in the Escrow Account, if any,

19 shall be refunded, on a pro rata basis, to appli20 cants whose loans guaranteed under this Act

21 were not in default, or where any default was

22 cured in accordance with the terms of the under23 lying loan or loan guarantee agreement.
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1 (i) JUDICIAL REVIEW.—The decision of the Board to

2 approve or disapprove the making of a loan guarantee

3 under this Act shall not be subject to judicial review.

4 SEC. 5. ADMINISTRATION OF LOAN GUARANTEES.

5 (a) IN GENERAL.—The Administrator of the Rural

6 Utilities Service (in this Act referred to as the ‘‘Adminis7 trator’’) shall issue and otherwise administer loan guaran8 tees that have been approved by the Board in accordance

9 with sections 3 and 4 of this Act.

10 (b) SECURITY FOR PROTECTION OF UNITED STATES

11 FINANCIAL INTERESTS.—

12 (1) TERMS AND CONDITIONS.—An applicant

13 shall agree to such terms and conditions as are satis14 factory, in the judgment of the Board, to ensure that,

15 as long as any principal or interest is due and pay16 able on a loan guaranteed under this Act, the

17 applicant—

18 (A) shall maintain assets, equipment, facili19 ties, and operations on a continuing basis;

20 (B) shall not make any discretionary divi21 dend payments that impair its ability to repay

22 obligations guaranteed under this Act; and

23 (C) shall remain sufficiently capitalized.

24 (2) COLLATERAL.—
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•S 2097 RS

1 (A) EXISTENCE OF ADEQUATE COLLAT2 ERAL.—An applicant shall provide the Board

3 such documentation as is necessary, in the judg4 ment of the Board, to provide satisfactory evi5 dence that appropriate and adequate collateral

6 secures a loan guaranteed under this Act.

7 (B) FORM OF COLLATERAL.—Collateral re8 quired by subparagraph (A) shall consist solely

9 of assets of the applicant, any affiliate of the ap10 plicant, or both (whichever the Board considers

11 appropriate), including primary assets to be

12 used in the delivery of signals for which the loan

13 is guaranteed.

14 (C) REVIEW OF VALUATION.—The value of

15 collateral securing a loan guaranteed under this

16 Act may be reviewed by the Board, and may be

17 adjusted downward by the Board if the Board

18 reasonably believes such adjustment is appro19 priate.

20 (3) LIEN ON INTERESTS IN ASSETS.—Upon the

21 Board’s approval of a loan guarantee under this Act,

22 the Administrator shall have liens on assets securing

23 the loan, which shall be superior to all other liens on

24 such assets, and the value of the assets (based on a de25 termination satisfactory to the Board) subject to the
41

•S 2097 RS

1 liens shall be at least equal to the unpaid balance of

2 the loan amount covered by the loan guarantee, or

3 that value approved by the Board under section

4 4(d)(3)(B)(iii) of this Act.

5 (4) PERFECTED SECURITY INTEREST.—With re6 spect to a loan guaranteed under this Act, the Admin7 istrator and the lender shall have a perfected security

8 interest in assets securing the loan that are fully suf9 ficient to protect the financial interests of the United

10 States and the lender.

11 (5) INSURANCE.—In accordance with practices

12 in the private capital market, as determined by the

13 Board, the applicant for a loan guarantee under this

14 Act shall obtain, at its expense, insurance sufficient

15 to protect the financial interests of the United States,

16 as determined by the Board.

17 (c) ASSIGNMENT OF LOAN GUARANTEES.—The holder

18 of a loan guarantee under this Act may assign the loan

19 guaranteed under this Act in whole or in part, subject to

20 such requirements as the Board may prescribe.

21 (d) MODIFICATION.—The Board may approve the

22 modification of any term or condition of a loan guarantee

23 or a loan guaranteed under this Act, including the rate of

24 interest, time of payment of principal or interest, or secu25 rity requirements only if—
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1 (1) the modification is consistent with the finan2 cial interests of the United States;

3 (2) consent has been obtained from the parties to

4 the loan agreement;

5 (3) the modification is consistent with the under6 writing criteria developed under section 4(g) of this

7 Act;

8 (4) the modification does not adversely affect the

9 interest of the Federal Government in the assets or

10 collateral of the applicant;

11 (5) the modification does not adversely affect the

12 ability of the applicant to repay the loan; and

13 (6) the National Telecommunications and Infor14 mation Administration has been consulted by the

15 Board regarding the modification.

16 (e) PERFORMANCE SCHEDULES.—

17 (1) PERFORMANCE SCHEDULES.—An applicant

18 for a loan guarantee under this Act for a project cov19 ered by section 4(e)(1) of this Act shall enter into

20 stipulated performance schedules with the Adminis21 trator with respect to the signals to be provided

22 through the project.

23 (2) PENALTY.—The Administrator may assess

24 against and collect from an applicant described in

25 paragraph (1) a penalty not to exceed 3 times the in-
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1 terest due on the guaranteed loan of the applicant

2 under this Act if the applicant fails to meet its stipu3 lated performance schedule under that paragraph.

4 (f) COMPLIANCE.—The Administrator, in cooperation

5 with the Board and as the regulations of the Board may

6 provide, shall enforce compliance by an applicant, and any

7 other party to a loan guarantee for whose benefit assistance

8 under this Act is intended, with the provisions of this Act,

9 any regulations under this Act, and the terms and condi10 tions of the loan guarantee, including through the submittal

11 of such reports and documents as the Board may require

12 in regulations prescribed by the Board and through regular

13 periodic inspections and audits.

14 (g) COMMERCIAL VALIDITY.—A loan guarantee under

15 this Act shall be incontestable—

16 (1) in the hands of an applicant on whose behalf

17 the loan guarantee is made, unless the applicant en18 gaged in fraud or misrepresentation in securing the

19 loan guarantee; and

20 (2) as to any person or entity (or their respective

21 successor in interest) who makes or contracts to make

22 a loan to the applicant for the loan guarantee in reli23 ance thereon, unless such person or entity (or respec24 tive successor in interest) engaged in fraud or mis-
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1 representation in making or contracting to make such

2 loan.

3 (h) DEFAULTS.—The Board shall prescribe regulations

4 governing defaults on loans guaranteed under this Act, in5 cluding the administration of the payment of guaranteed

6 amounts upon default.

7 (i) RECOVERY OF PAYMENTS.—

8 (1) IN GENERAL.—The Administrator shall be

9 entitled to recover from an applicant for a loan guar10 antee under this Act the amount of any payment

11 made to the holder of the guarantee with respect to the

12 loan.

13 (2) SUBROGATION.—Upon making a payment

14 described in paragraph (1), the Administrator shall

15 be subrogated to all rights of the party to whom the

16 payment is made with respect to the guarantee which

17 was the basis for the payment.

18 (3) DISPOSITION OF PROPERTY.—

19 (A) SALE OR DISPOSAL.—The Adminis20 trator shall, in an orderly and efficient manner,

21 sell or otherwise dispose of any property or other

22 interests obtained under this Act in a manner

23 that maximizes taxpayer return and is con24 sistent with the financial interests of the United

25 States.
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1 (B) MAINTENANCE.—The Administrator

2 shall maintain in a cost-effective and reasonable

3 manner any property or other interests pending

4 sale or disposal of such property or other inter5 ests under subparagraph (A).

6 (j) ACTION AGAINST OBLIGOR.—

7 (1) AUTHORITY TO BRING CIVIL ACTION.—The

8 Administrator may bring a civil action in an appro9 priate district court of the United States in the name

10 of the United States or of the holder of the obligation

11 in the event of a default on a loan guaranteed under

12 this Act. The holder of a loan guarantee shall make

13 available to the Administrator all records and evi14 dence necessary to prosecute the civil action.

15 (2) FULLY SATISFYING OBLIGATIONS OWED THE

16 UNITED STATES.—The Administrator may accept

17 property in satisfaction of any sums owed the United

18 States as a result of a default on a loan guaranteed

19 under this Act, but only to the extent that any cash

20 accepted by the Administrator is not sufficient to sat21 isfy fully the sums owed as a result of the default.

22 (k) BREACH OF CONDITIONS.—The Administrator

23 shall commence a civil action in a court of appropriate ju24 risdiction to enjoin any activity which the Board finds is

25 in violation of this Act, the regulations under this Act, or
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1 any conditions which were duly agreed to, and to secure

2 any other appropriate relief, including relief against any

3 affiliate of the applicant.

4 (l) ATTACHMENT.—No attachment or execution may be

5 issued against the Administrator or any property in the

6 control of the Administrator pursuant to this Act before the

7 entry of a final judgment (as to which all rights of appeal

8 have expired) by a Federal, State, or other court of com9 petent jurisdiction against the Administrator in a pro10 ceeding for such action.

11 (m) FEES.—

12 (1) APPLICATION FEE.—The Board may charge

13 and collect from an applicant for a loan guarantee

14 under this Act a fee to cover the cost of the Board in

15 making necessary determinations and findings with

16 respect to the loan guarantee application under this

17 Act. The amount of the fee shall be reasonable.

18 (2) LOAN GUARANTEE ORIGINATION FEE.—The

19 Board may charge, and the Administrator may col20 lect, a loan guarantee origination fee with respect to

21 the issuance of a loan guarantee under this Act.

22 (3) USE OF FEES COLLECTED.—Any fee collected

23 under this subsection shall be used to offset adminis24 trative costs under this Act, including costs of the

25 Board and of the Administrator.
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1 (n) REQUIREMENTS RELATING TO AFFILIATES.—

2 (1) INDEMNIFICATION.—The United States shall

3 be indemnified by any affiliate (acceptable to the

4 Board) of an applicant for a loan guarantee under

5 this Act for any losses that the United States incurs

6 as a result of—

7 (A) a judgment against the applicant or

8 any of its affiliates;

9 (B) any breach by the applicant or any of

10 its affiliates of their obligations under the loan

11 guarantee agreement;

12 (C) any violation of the provisions of this

13 Act, and the regulations prescribed under this

14 Act, by the applicant or any of its affiliates;

15 (D) any penalties incurred by the applicant

16 or any of its affiliates for any reason, including

17 violation of a stipulated performance schedule

18 under subsection (e); and

19 (E) any other circumstances that the Board

20 considers appropriate.

21 (2) LIMITATION ON TRANSFER OF LOAN PRO22 CEEDS.—An applicant for a loan guarantee under

23 this Act may not transfer any part of the proceeds of

24 the loan to an affiliate.
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1 (o) EFFECT OF BANKRUPTCY.—(1) Notwithstanding

2 any other provision of law, whenever any person or entity

3 is indebted to the United States as a result of any loan

4 guarantee issued under this Act and such person or entity

5 is insolvent or is a debtor in a case under title 11, United

6 States Code, the debts due to the United States shall be sat7 isfied first.

8 (2) A discharge in bankruptcy under title 11, United

9 States Code, shall not release a person or entity from an

10 obligation to the United States in connection with a loan

11 guarantee under this Act.

12 SEC. 6. ANNUAL AUDIT.

13 (a) REQUIREMENT.—The Comptroller General of the

14 United States shall conduct on an annual basis an audit

15 of the administration of the provisions of this Act.

16 (b) REPORT.—The Comptroller General shall submit

17 to the Committee on Banking, Housing, and Urban Affairs

18 of the Senate and the Committee on Banking and Financial

19 Services of the House of Representatives a report on each

20 audit conducted under subsection (a).

21 SEC. 7. SUNSET.

22 No loan guarantee may be approved under this Act

23 after December 31, 2006.
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1 SEC. 8. RETRANSMISSION OF LOCAL TELEVISION BROAD2 CAST STATIONS.

3 An applicant shall be subject to applicable rights, obli4 gations, and limitations of title 17, United States Code. If

5 a local broadcast station requests carriage of its signal and

6 is located in a market not served by a satellite carrier pro7 viding service under a statutory license under section 122

8 of title 17, United States Code, the applicant shall carry

9 the signal of that station without charge, and shall be sub10 ject to the applicable rights, obligations, and limitations of

11 sections 338, 614, and 615 of the Communications Act of

12 1934.

13 SEC. 9. DEFINITIONS.

14 In this Act:

15 (1) AFFILIATE.—The term ‘‘affiliate’’—

16 (A) means any person or entity that con17 trols, or is controlled by, or is under common

18 control with, another person or entity; and

19 (B) may include any individual who is a

20 director or senior management officer of an affil21 iate, a shareholder controlling more than 25 per22 cent of the voting securities of an affiliate, or

23 more than 25 percent of the ownership interest

24 in an affiliate not organized in stock form.

25 (2) UNSERVED AREA.—The term ‘‘unserved

26 area’’ means any area that—
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1 (A) is outside the grade B contour (as deter2 mined using standards employed by the Federal

3 Communications Commission) of the local tele4 vision broadcast signals serving a particular des5 ignated market area; and

6 (B) does not have access to such signals by

7 other widely marketed means.

8 (3) UNDERSERVED AREA.—The term ‘‘under9 served area’’ means any area that—

10 (A) is outside the grade A contour (as deter11 mined using standards employed by the Federal

12 Communications Commission) of the local tele13 vision broadcast signals serving a particular des14 ignated market area; and

15 (B) has access to local television broadcast

16 signals from not more than one commercial, for17 profit multichannel video provider.

18 (4) COMMON TERMS.—Except as provided in

19 paragraphs (1) through (3), any term used in this

20 Act that is defined in the Communications Act of

21 1934 (47 U.S.C. 151 et seq.) has the meaning given

22 that term in the Communications Act of 1934.

23 SEC. 10. AUTHORIZATIONS OF APPROPRIATIONS.

24 (a) COST OF LOAN GUARANTEES.—For the cost of the

25 loans guaranteed under this Act, including the cost of modi-
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1 fying the loans, as defined in section 502 of the Congres2 sional Budget Act of 1974 (2 U.S.C. 661(a)), there are au3 thorized to be appropriated for fiscal years 2001 through

4 2006, such amounts as may be necessary.

5 (b) COST OF ADMINISTRATION.—There is hereby au6 thorized to be appropriated such sums as may be necessary

7 to carry out the provisions of this Act, other than to cover

8 costs under subsection (a).

9 (c) AVAILABILITY.—Any amounts appropriated pursu10 ant to the authorizations of appropriations in subsections

11 (a) and (b) shall remain available until expended.