106TH CONGRESS

2D SESSION S. 2097

AN ACT

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,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Launching Our Com5 munities’ Access to Local Television Act of 2000’’.
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1 SEC. 2. PURPOSE.

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

3 technologically neutral basis and by December 31, 2006,

4 to signals of local television stations, and related signals

5 (including high-speed Internet access and National Weath6 er Service warnings), for households located in unserved

7 areas and underserved areas.

8 SEC. 3. LOCAL TELEVISION LOAN GUARANTEE BOARD.

9 (a) ESTABLISHMENT.—There is established the

10 LOCAL Television Loan Guarantee Board (in this Act re11 ferred to as the ‘‘Board’’).

12 (b) MEMBERS.—

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

14 the Board shall consist of the following members:

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

16 designee of the Secretary.

17 (B) The Chairman of the Board of Gov18 ernors of the Federal Reserve System, or the

19 designee of the Chairman.

20 (C) The Secretary of Agriculture, or the

21 designee of the Secretary.

22 (2) REQUIREMENT AS TO DESIGNEES.—An in23 dividual may not be designated a member of the

24 Board under paragraph (1) unless the individual is

25 an officer of the United States pursuant to an ap-
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1 pointment by the President, by and with the advice

2 and consent of the Senate.

3 (c) FUNCTIONS OF THE BOARD.—

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

5 whether or not to approve loan guarantees under

6 this Act. The Board shall make such determinations

7 consistent with the purpose of this Act and in ac8 cordance with this subsection and section 4 of this

9 Act.

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 Administrator (as

14 defined in section 5 of this Act), under the direction

15 of and for approval by the Board, shall prescribe

16 regulations to implement the provisions of this Act

17 and shall do so not later than 120 days after funds

18 authorized to be appropriated under section 9 of this

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

20 (2) ELEMENTS.—The regulations prescribed

21 under paragraph (1) shall—

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

23 be submitted to the Board under this Act;

24 (B) set forth time periods for the review

25 and consideration by the Board of applications
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1 to be submitted to the Board under this Act,

2 and for any other action to be taken by the

3 Board with respect to such applications;

4 (C) provide appropriate safeguards against

5 the evasion of the provisions of this Act;

6 (D) set forth the circumstances in which

7 an applicant, together with any affiliate of an

8 applicant, shall be treated as an applicant for

9 a loan guarantee under this Act;

10 (E) include requirements that appropriate

11 parties submit to the Board any documents and

12 assurances that are required for the administra13 tion of the provisions of this Act; and

14 (F) include such other provisions con15 sistent with the purpose of this Act as the

16 Board considers appropriate.

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

18 shall be construed to prohibit the Board from requir19 ing, to the extent and under circumstances consid20 ered appropriate by the Board, that affiliates of an

21 applicant be subject to certain obligations of the ap22 plicant as a condition to the approval or mainte23 nance of a loan guarantee under this Act.

24 (B) If any provision of this Act or the applica25 tion of such provision to any person or entity or cir-
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1 cumstance is held to be invalid by a court of com2 petent jurisdiction, the remainder of this Act, or the

3 application of such provision to such person or entity

4 or circumstance other than those as to which it is

5 held invalid, shall not be affected thereby.

6 (c) AUTHORITY LIMITED BY APPROPRIATIONS

7 ACTS.—The Board may approve loan guarantees under

8 this Act only to the extent provided for in advance in ap9 propriations Acts. The Board may delegate to the Admin10 istrator (as defined in section 5 of this Act) the authority

11 to approve loan guarantees of up to $20,000,000. To the

12 extent the Administrator is delegated such authority, the

13 Administrator shall comply with the terms of this Act ap14 plicable to the Board.

15 (d) REQUIREMENTS AND CRITERIA APPLICABLE TO

16 APPROVAL.—

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

18 underwriting criteria developed under subsection (g),

19 and any relevant information provided by the de20 partments and agencies with which the Board

21 consults under section 3, to determine which loans

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

23 (2) PREREQUISITES.—In addition to meeting

24 the underwriting criteria under paragraph (1), a

25 loan may not be guaranteed under this Act unless—
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1 (A) the loan is made to finance the acqui2 sition, improvement, enhancement, construction,

3 deployment, launch, or rehabilitation of the

4 means by which local television broadcast sig5 nals, and related signals (including high-speed

6 Internet access and National Weather Service

7 warnings), will be delivered to an unserved area

8 or underserved area;

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

10 used for operating expenses;

11 (C) the proposed project, as determined by

12 the Board in consultation with the National

13 Telecommunications and Information Adminis14 tration, is not likely to have a substantial ad15 verse impact on competition that outweighs the

16 benefits of improving access to the signals of a

17 local television station in an unserved area or

18 underserved area;

19 (D)(i) the loan (including Other Debt, as

20 defined in subsection (f)(2)(B))—

21 (I) is provided by any entity engaged

22 in the business of commercial lending—

23 (aa) if the loan is made in ac24 cordance with loan-to-one-borrower

25 and affiliate transaction restrictions to
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1 which the entity is subject under ap2 plicable law; or

3 (bb) if item (aa) does not apply,

4 the loan is made only to a borrower

5 that is not an affiliate of the entity

6 and only if the amount of the loan

7 and all outstanding loans by that enti8 ty to that borrower and any of its af9 filiates does not exceed 10 percent of

10 the net equity of the entity; or

11 (II) is provided by a nonprofit cor12 poration, including the National Rural

13 Utilities Cooperative Finance Corporation,

14 engaged primarily in commercial lending, if

15 the Board determines that such nonprofit

16 corporation has one or more issues of out17 standing long-term debt that is rated with18 in the highest 3 rating categories of a na19 tionally recognized statistical rating orga20 nization, and, if the Board determines that

21 the making of the loan by such nonprofit

22 corporation will cause a decline in the debt

23 rating mentioned above, the Board at its

24 discretion may disapprove the loan guar25 antee on this basis;
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1 (ii)(I) no loan (including Other Debt as de2 fined in subsection (f)(2)(B)) may be made for

3 purposes of this Act by a governmental entity

4 or affiliate thereof, or by the Federal Agricul5 tural Mortgage Corporation, or any institution

6 supervised by the Office of Federal Housing

7 Enterprise Oversight, the Federal Housing Fi8 nance Board, or any affiliate of such entities;

9 (II) any loan (including Other Debt as de10 fined in subsection (f)(2)(B)) must have terms,

11 in the judgment of the Board, that are con12 sistent in material respects with the terms of

13 similar obligations in the private capital mar14 ket;

15 (III) for purposes of clause (i)(I)(bb), the

16 term ‘‘net equity’’ means the value of the total

17 assets of the entity, less the total liabilities of

18 the entity, as recorded under generally accepted

19 accounting principles for the fiscal quarter

20 ended immediately prior to the date on which

21 the subject loan is approved;

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

23 made within a term of the lesser of—

24 (i) 25 years from the date of the exe25 cution of the loan; or
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1 (ii) the economically useful life, as de2 termined by the Board or in consultation

3 with persons or entities deemed appro4 priate by the Board, of the primary assets

5 to be used in the delivery of the signals

6 concerned; and

7 (F) the loan meets any additional criteria

8 developed under subsection (g).

9 (3) PROTECTION OF UNITED STATES FINAN10 CIAL INTERESTS.—The Board may not approve the

11 guarantee of a loan under this Act unless—

12 (A) the Board has been given documenta13 tion, assurances, and access to information,

14 persons, and entities necessary, as determined

15 by the Board, to address issues relevant to the

16 review of the loan by the Board for purposes of

17 this Act; and

18 (B) the Board makes a determination in

19 writing that—

20 (i) to the best of its knowledge upon

21 due inquiry, the assets, facilities, or equip22 ment covered by the loan will be utilized

23 economically and efficiently;

24 (ii) the terms, conditions, security,

25 and schedule and amount of repayments of
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1 principal and the payment of interest with

2 respect to the loan protect the financial in3 terests of the United States and are rea4 sonable;

5 (iii) to the extent possible, the value

6 of collateral provided by an applicant is at

7 least equal to the unpaid balance of the

8 loan amount covered by the loan guarantee

9 (the ‘‘Amount’’ for purposes of this

10 clause); and if the value of collateral pro11 vided by an applicant is less than the

12 Amount, the additional required collateral

13 is provided by any affiliate of the appli14 cant; and if the combined value of collat15 eral provided by an applicant and any affil16 iate is not at least equal to the Amount,

17 the collateral from such affiliate represents

18 all of such affiliate’s assets;

19 (iv) all necessary and required regu20 latory and other approvals, spectrum

21 rights, and delivery permissions have been

22 received for the loan, the project under the

23 loan, and the Other Debt, if any, under

24 subsection (f)(2)(B);
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1 (v) the loan would not be available on

2 reasonable terms and conditions without a

3 loan guarantee under this Act; and

4 (vi) repayment of the loan can reason5 ably be expected.

6 (e) CONSIDERATIONS.—

7 (1) TYPE OF MARKET.—

8 (A) PRIORITY CONSIDERATIONS.—To the

9 maximum extent practicable, the Board shall

10 give priority in the approval of loan guarantees

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

12 projects that will serve the greatest number of

13 households in unserved areas and the number

14 of States (including noncontiguous States); and

15 second, to projects that will serve the greatest

16 number of households in underserved areas. In

17 each instance, the Board shall consider the

18 project’s efficiency in providing service given

19 the area to be served.

20 (B) ADDITIONAL CONSIDERATIONS.—To

21 the maximum extent practicable, the Board

22 should give additional consideration to projects

23 which also provide related signals (including

24 high-speed Internet access and National Weath25 er Service warnings).
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1 (C) PROHIBITION.—The Board may not

2 approve a loan guarantee under this Act for a

3 project that is designed primarily to serve 1 or

4 more of the 40 most populated designated mar5 ket areas (as that term is defined in section

6 122(j) of title 17, United States Code).

7 (2) OTHER CONSIDERATIONS.—The Board shall

8 consider other factors, which shall include projects

9 that would—

10 (A) offer a separate tier of local broadcast

11 signals, but for applicable Federal, State, or

12 local laws or regulations;

13 (B) provide lower projected costs to con14 sumers of such separate tier; and

15 (C) enable the delivery of local broadcast

16 signals consistent with the purpose of this Act

17 by a means reasonably compatible with existing

18 systems or devices predominantly in use.

19 (f) GUARANTEE LIMITS.—

20 (1) LIMITATION ON AGGREGATE VALUE OF

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

22 loan guarantees are issued under this Act (including

23 the unguaranteed portion of loans issued under

24 paragraph (2)(A)) and Other Debt under paragraph

25 (2)(B) may not exceed $1,250,000,000.
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1 (2) GUARANTEE LEVEL.—A loan guarantee

2 issued under this Act—

3 (A) may not exceed an amount equal to 80

4 percent of a loan meeting in its entirety the re5 quirements of subsection (d)(2)(A). If only a

6 portion of a loan meets the requirements of

7 that subsection, the Board shall determine that

8 percentage of the loan meeting such require9 ments (the ‘‘applicable portion’’) and may issue

10 a loan guarantee in an amount not exceeding

11 80 percent of the applicable portion; or

12 (B) may, as to a loan meeting in its en13 tirety the requirements of subsection (d)(2)(A),

14 cover the amount of such loan only if that loan

15 is for an amount not exceeding 80 percent of

16 the total debt financing for the project, and

17 other debt financing (also meeting in its en18 tirety the requirements of subsection (d)(2)(A))

19 from the same source for a total amount not

20 less than 20 percent of the total debt financing

21 for the project (‘‘Other Debt’’) has been ap22 proved.

23 (g) UNDERWRITING CRITERIA.—Within the period

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

25 consultation with the Director of the Office of Manage-
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1 ment and Budget and an independent public accounting

2 firm, develop underwriting criteria relating to the guar3 antee of loans that are consistent with the purpose of this

4 Act, including appropriate collateral and cash flow levels

5 for loans guaranteed under this Act, and such other mat6 ters as the Board considers appropriate.

7 (h) CREDIT RISK PREMIUMS.—

8 (1) ESTABLISHMENT AND ACCEPTANCE.—The

9 Board may establish and approve the acceptance of

10 credit risk premiums with respect to a loan guar11 antee under this Act in order to cover the cost, as

12 determined under section 504(b)(1) of the Federal

13 Credit Reform Act of 1990, of the loan guarantee.

14 To the extent that appropriations of budget author15 ity are insufficient to cover the cost, as so deter16 mined, of a loan guarantee under this Act, credit

17 risk premiums shall be accepted from a non-Federal

18 source under this subsection on behalf of the appli19 cant for the loan guarantee.

20 (2) CREDIT RISK PREMIUM AMOUNT.—

21 (A) IN GENERAL.—The Board shall deter22 mine the amount of any credit risk premium to

23 be accepted with respect to a loan guarantee

24 under this Act on the basis of—
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1 (i) the financial and economic cir2 cumstances of the applicant for the loan

3 guarantee, including the amount of collat4 eral offered;

5 (ii) the proposed schedule of loan dis6 bursements;

7 (iii) the business plans of the appli8 cant for providing service;

9 (iv) any financial commitment from a

10 broadcast signal provider; and

11 (v) the concurrence of the Director of

12 the Office of Management and Budget as

13 to the amount of the credit risk premium.

14 (B) PROPORTIONALITY.—To the extent

15 that appropriations of budget authority are suf16 ficient to cover the cost, as determined under

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

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

19 the credit risk premium with respect to each

20 loan guarantee shall be reduced proportionately.

21 (C) PAYMENT OF PREMIUMS.—Credit risk

22 premiums under this subsection shall be paid to

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

24 in the Treasury which shall accrue interest and
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1 such interest shall be retained by the account,

2 subject to subparagraph (D).

3 (D) DEDUCTIONS FROM ESCROW AC4 COUNT.—If a default occurs with respect to any

5 loan guaranteed under this Act and the default

6 is not cured in accordance with the terms of the

7 underlying loan or loan guarantee agreement,

8 the Administrator, in accordance with sub9 sections (h) and (i) of section 5 of this Act,

10 shall liquidate, or shall cause to be liquidated,

11 all assets collateralizing such loan as to which

12 it has a lien or security interest. Any shortfall

13 between the proceeds of the liquidation net of

14 costs and expenses relating to the liquidation,

15 and the guarantee amount paid pursuant to

16 this Act shall be deducted from funds in the

17 Escrow Account and credited to the Adminis18 trator for payment of such shortfall. At such

19 time as determined under subsection (d)(2)(E)

20 when all loans guaranteed under this Act have

21 been repaid or otherwise satisfied in accordance

22 with this Act and the regulations promulgated

23 hereunder, remaining funds in the Escrow Ac24 count, if any, shall be refunded, on a pro rata

25 basis, to applicants whose loans guaranteed
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1 under this Act were not in default, or where

2 any default was cured in accordance with the

3 terms of the underlying loan or loan guarantee

4 agreement.

5 (i) JUDICIAL REVIEW.—The decision of the Board to

6 approve or disapprove the making of a loan guarantee

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

8 SEC. 5. ADMINISTRATION OF LOAN GUARANTEES.

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

10 Utilities Service (in this Act referred to as the ‘‘Adminis11 trator’’) shall issue and otherwise administer loan guaran12 tees that have been approved by the Board in accordance

13 with sections 3 and 4 of this Act.

14 (b) SECURITY FOR PROTECTION OF UNITED STATES

15 FINANCIAL INTERESTS.—

16 (1) TERMS AND CONDITIONS.—An applicant

17 shall agree to such terms and conditions as are sat18 isfactory, in the judgment of the Board, to ensure

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

20 payable on a loan guaranteed under this Act, the

21 applicant—

22 (A) shall maintain assets, equipment, fa23 cilities, and operations on a continuing basis;
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1 (B) shall not make any discretionary divi2 dend payments that impair its ability to repay

3 obligations guaranteed under this Act; and

4 (C) shall remain sufficiently capitalized.

5 (2) COLLATERAL.—

6 (A) EXISTENCE OF ADEQUATE COLLAT7 ERAL.—An applicant shall provide the Board

8 such documentation as is necessary, in the

9 judgment of the Board, to provide satisfactory

10 evidence that appropriate and adequate collat11 eral secures a loan guaranteed under this Act.

12 (B) FORM OF COLLATERAL.—Collateral re13 quired by subparagraph (A) shall consist solely

14 of assets of the applicant, any affiliate of the

15 applicant, or both (whichever the Board con16 siders appropriate), including primary assets to

17 be used in the delivery of signals for which the

18 loan is guaranteed.

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

20 collateral securing a loan guaranteed under this

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

22 adjusted downward by the Board if the Board

23 reasonably believes such adjustment is appro24 priate.
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1 (3) LIEN ON INTERESTS IN ASSETS.—Upon the

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

3 the Administrator shall have liens on assets securing

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

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

6 a determination satisfactory to the Board) subject to

7 the liens shall be at least equal to the unpaid bal8 ance of the loan amount covered by the loan guar9 antee, or that value approved by the Board under

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

11 (4) PERFECTED SECURITY INTEREST.—With

12 respect to a loan guaranteed under this Act, the Ad13 ministrator and the lender shall have a perfected se14 curity interest in assets securing the loan that are

15 fully sufficient to protect the financial interests of

16 the United States and the lender.

17 (5) INSURANCE.—In accordance with practices

18 in the private capital market, as determined by the

19 Board, the applicant for a loan guarantee under this

20 Act shall obtain, at its expense, insurance sufficient

21 to protect the financial interests of the United

22 States, as determined by the Board.

23 (c) ASSIGNMENT OF LOAN GUARANTEES.—The hold24 er of a loan guarantee under this Act may assign the loan
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1 guaranteed under this Act in whole or in part, subject to

2 such requirements as the Board may prescribe.

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

4 modification of any term or condition of a loan guarantee

5 or a loan guaranteed under this Act, including the rate

6 of interest, time of payment of principal or interest, or

7 security requirements only if—

8 (1) the modification is consistent with the fi9 nancial interests of the United States;

10 (2) consent has been obtained from the parties

11 to the loan agreement;

12 (3) the modification is consistent with the un13 derwriting criteria developed under section 4(g) of

14 this Act;

15 (4) the modification does not adversely affect

16 the interest of the Federal Government in the assets

17 or collateral of the applicant;

18 (5) the modification does not adversely affect

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

20 (6) the National Telecommunications and Infor21 mation Administration has been consulted by the

22 Board regarding the modification.

23 (e) PERFORMANCE SCHEDULES.—

24 (1) PERFORMANCE SCHEDULES.—An applicant

25 for a loan guarantee under this Act for a project
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1 covered by section 4(e)(1) of this Act shall enter into

2 stipulated performance schedules with the Adminis3 trator with respect to the signals to be provided

4 through the project.

5 (2) PENALTY.—The Administrator may assess

6 against and collect from an applicant described in

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

8 interest due on the guaranteed loan of the applicant

9 under this Act if the applicant fails to meet its stip10 ulated performance schedule under that paragraph.

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

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

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

14 other party to a loan guarantee for whose benefit assist15 ance under this Act is intended, with the provisions of this

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

17 conditions of the loan guarantee, including through the

18 submittal of such reports and documents as the Board

19 may require in regulations prescribed by the Board and

20 through regular periodic inspections and audits.

21 (g) COMMERCIAL VALIDITY.—A loan guarantee

22 under this Act shall be incontestable—

23 (1) in the hands of an applicant on whose be24 half the loan guarantee is made, unless the applicant
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1 engaged in fraud or misrepresentation in securing

2 the loan guarantee; and

3 (2) as to any person or entity (or their respec4 tive successor in interest) who makes or contracts to

5 make a loan to the applicant for the loan guarantee

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

7 respective successor in interest) engaged in fraud or

8 misrepresentation in making or contracting to make

9 such loan.

10 (h) DEFAULTS.—The Board shall prescribe regula11 tions governing defaults on loans guaranteed under this

12 Act, including the administration of the payment of guar13 anteed amounts upon default.

14 (i) RECOVERY OF PAYMENTS.—

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

16 entitled to recover from an applicant for a loan

17 guarantee under this Act the amount of any pay18 ment made to the holder of the guarantee with re19 spect to the loan.

20 (2) SUBROGATION.—Upon making a payment

21 described in paragraph (1), the Administrator shall

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

23 payment is made with respect to the guarantee

24 which was the basis for the payment.

25 (3) DISPOSITION OF PROPERTY.—
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1 (A) SALE OR DISPOSAL.—The Adminis2 trator shall, in an orderly and efficient manner,

3 sell or otherwise dispose of any property or

4 other interests obtained under this Act in a

5 manner that maximizes taxpayer return and is

6 consistent with the financial interests of the

7 United States.

8 (B) MAINTENANCE.—The Administrator

9 shall maintain in a cost-effective and reasonable

10 manner any property or other interests pending

11 sale or disposal of such property or other inter12 ests under subparagraph (A).

13 (j) ACTION AGAINST OBLIGOR.—

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

15 Administrator may bring a civil action in an appro16 priate district court of the United States in the

17 name of the United States or of the holder of the

18 obligation in the event of a default on a loan guar19 anteed under this Act. The holder of a loan guar20 antee shall make available to the Administrator all

21 records and evidence necessary to prosecute the civil

22 action.

23 (2) FULLY SATISFYING OBLIGATIONS OWED

24 THE UNITED STATES.—The Administrator may ac25 cept property in satisfaction of any sums owed the
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1 United States as a result of a default on a loan

2 guaranteed under this Act, but only to the extent

3 that any cash accepted by the Administrator is not

4 sufficient to satisfy fully the sums owed as a result

5 of the default.

6 (k) BREACH OF CONDITIONS.—The Administrator

7 shall commence a civil action in a court of appropriate

8 jurisdiction to enjoin any activity which the Board finds

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

10 or any conditions which were duly agreed to, and to secure

11 any other appropriate relief, including relief against any

12 affiliate of the applicant.

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

14 be issued against the Administrator or any property in the

15 control of the Administrator pursuant to this Act before

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

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

18 of competent jurisdiction against the Administrator in a

19 proceeding for such action.

20 (m) FEES.—

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

22 and collect from an applicant for a loan guarantee

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

24 in making necessary determinations and findings
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1 with respect to the loan guarantee application under

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

3 (2) LOAN GUARANTEE ORIGINATION FEE.—The

4 Board may charge, and the Administrator may col5 lect, a loan guarantee origination fee with respect to

6 the issuance of a loan guarantee under this Act.

7 (3) USE OF FEES COLLECTED.—Any fee col8 lected under this subsection shall be used to offset

9 administrative costs under this Act, including costs

10 of the Board and of the Administrator.

11 (n) REQUIREMENTS RELATING TO AFFILIATES.—

12 (1) INDEMNIFICATION.—The United States

13 shall be indemnified by any affiliate (acceptable to

14 the Board) of an applicant for a loan guarantee

15 under this Act for any losses that the United States

16 incurs as a result of—

17 (A) a judgment against the applicant or

18 any of its affiliates;

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

20 its affiliates of their obligations under the loan

21 guarantee agreement;

22 (C) any violation of the provisions of this

23 Act, and the regulations prescribed under this

24 Act, by the applicant or any of its affiliates;
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1 (D) any penalties incurred by the applicant

2 or any of its affiliates for any reason, including

3 violation of a stipulated performance schedule

4 under subsection (e); and

5 (E) any other circumstances that the

6 Board considers appropriate.

7 (2) LIMITATION ON TRANSFER OF LOAN PRO8 CEEDS.—An applicant for a loan guarantee under

9 this Act may not transfer any part of the proceeds

10 of the loan to an affiliate.

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

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

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

14 guarantee issued under this Act and such person or entity

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

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

17 satisfied first.

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

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

20 obligation to the United States in connection with a loan

21 guarantee under this Act.

22 SEC. 6. ANNUAL AUDIT.

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

24 United States shall conduct on an annual basis an audit

25 of the administration of the provisions of this Act.
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1 (b) REPORT.—The Comptroller General shall submit

2 to the Committee on Banking, Housing, and Urban Af3 fairs of the Senate and the Committee on Banking and

4 Financial Services of the House of Representatives a re5 port on each audit conducted under subsection (a).

6 SEC. 7. SUNSET.

7 No loan guarantee may be approved under this Act

8 after December 31, 2006.

9 SEC. 8. DEFINITIONS.

10 In this Act:

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

12 (A) means any person or entity that con13 trols, or is controlled by, or is under common

14 control with, another person or entity; and

15 (B) may include any individual who is a di16 rector or senior management officer of an affil17 iate, a shareholder controlling more than 25

18 percent of the voting securities of an affiliate,

19 or more than 25 percent of the ownership inter20 est in an affiliate not organized in stock form.

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

22 area’’ means any area that—

23 (A) is outside the grade B contour (as de24 termined using standards employed by the Fed25 eral Communications Commission) of the local
29

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1 television broadcast signals serving a particular

2 designated market area; and

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

4 other widely marketed means.

5 (3) UNDERSERVED AREA.—The term ‘‘under6 served area’’ means any area that—

7 (A) is outside the grade A contour (as de8 termined using standards employed by the Fed9 eral Communications Commission) of the local

10 television broadcast signals serving a particular

11 designated market area; and

12 (B) has access to local television broadcast

13 signals from not more than one commercial,

14 for-profit multichannel video provider.

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

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

17 Act that is defined in the Communications Act of

18 1934 (47 U.S.C. 151 et seq.) has the meaning given

19 that term in the Communications Act of 1934.

20 SEC. 9. AUTHORIZATIONS OF APPROPRIATIONS.

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

22 the loans guaranteed under this Act, including the cost

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

24 Congressional Budget Act of 1974 (2 U.S.C. 661(a)),
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1 there are authorized to be appropriated for fiscal years

2 2001 through 2006, such amounts as may be necessary.

3 (b) COST OF ADMINISTRATION.—There is hereby au4 thorized to be appropriated such sums as may be nec5 essary to carry out the provisions of this Act, other than

6 to cover costs under subsection (a).

7 (c) AVAILABILITY.—Any amounts appropriated pur8 suant to the authorizations of appropriations in sub9 sections (a) and (b) shall remain available until expended.

Passed the Senate March 30, 2000.

Attest:

Secretary.
106TH CONGRESS

2D SESSION S. 2097

AN ACT

To authorize loan guarantees in order to facilitate

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