An Act to provide for financing the economic development of Indians and Indian organizations, and for other purposes.
PL 93-262 (S.1341), enacted 04/12/1974

88 STAT. ] 
PUBLIC LAW 93-262-APR. 12, 1974 
77 
Public Law 93-262 
AN ACT 
To provide for financing the economic development of Indians and Indian 
organizations, and for other purposes. 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled, That this Act may be 
cited as the "Indian Financing Act of 1974". 
DECLARATION OF POLICY 
SEC. 2. It is hereby declared to be the policy of Congress to provide 
capital on a reimbursable basis to help develop and utilize Indian 
resources, both physical and human, to a point where the Indians will 
fully exercise responsibility for the utilization and management of 
their own resources and where they will enjoy a standard of living 
from their own productive efforts comparable to that enjoyed by non-
Indians in neighboring communities. 
DEFINITIONS 
SEC. 3. For the purpose of this Act, the term— 
(a) "Secretary" means the Secretary of the Interior. 
(b) "Indian" means any person who is a member of any Indian 
tribe, band, group, pueblo, or community which is recognized by the 
Federal Government as eligible for services from the Bureau of Indian 
Affairs and any "Native" as defined in the Alaska Native Claims 
Settlement Act (85 Stat. 688). 
(c) "Tribe" means any Indian tribe, band, group, pueblo, or com-
munity, including Native villages and Native groups (including cor-
porations organized by Kenai, Juneau, Sitka, and Kodiak) as defined 
in the Ala'^ka Native Claims Settlement Act, Avhich is recognized by 
the Federal Government as eligible for services from the Bureau of 
Indian Affairs. 
(d) "Reservation" includes Indian reservations, public domain 
Indian allotments, former Indian reservations in Oklahoma, and land 
held by incorporated Native groups, regional corporations, and vil-
lage corporations under the provisions of the Alaska Native Claims 
Settlement Act. 
(e) "Economic enterprise" means any Indian-owned (as defined by 
the Secretary of the Interior) commercial, industrial, or business 
activity established or organized for the purpose of profit: Provided, 
That such Indian ownership shall constitute not less than 51 per 
centum of the enterprise. 
(f) "Organization", unless otherwise specified, shall be the govern-
ing body of any Indian tribe, as defined in subsection (c) hereof, or 
entity established or recognized by such governing body for the pur-
pose of this Act. 
(g) "Other organizations" means any non-Indian individual, firm, 
corporation, partnership, or association. 
SEC. 4. No provision of this or any other Act shall be construed to 
terminate or otherwise curtail the assistance or activities of the Small 
Business Administration or any other Federal agency with respect to 
any Indian tribe, organization, or individual because of their eligibil-
ity for assistance under this Act. 
April 12, 1974 
[S.1341] 
Indian Financ-
ing Act of 1974. 
25 u s e 1451 
note. 
25 u s e 1451. 
25 u s e 1452. 
43 u s e 1602. 
25 u s e 1453. 
443. 
78 
PUBLIC L
A
W 93-262-APR. 12, 1974 
[88 STAT. 
TITLE I—INDIAN EEVOLVING LOAN FUND 
25 use 1461. 
SEC. 101, In order to provide credit that is not available from pri-
vate money markets, all funds that are now or hereafter a part of the 
25 use 470. 
revolving fund authorized by the Act of June 18, 1934 (48 Stat. 986), 
25 use 506. 
tiie ^(^t Qf jyj^g 26, 1936 (49 Stat. 1968), and the Act of April 19, 
25 use 634. 
1950 (64 Stat. 44), as amended and supplemented, including sums 
received in settlement of debts of livestock pursuant to the Act of 
25 use 442, 
May 24, 1950 (64 Stat. 190), and sums collected in repayment of loans 
^^' 
heretofore or hereafter made, and as interest or other charges on loans, 
shall hereafter be administered as a single Indian Eevolving Loan 
Fund. The fund shall be available for loans to Indians having a form 
of organization that is satisfactory to the Secretary and for loans to 
individual Indians who are not members of or eligible for membership 
in an organization which is making loans to its members: Provided^ 
That, where the Secretary determines a rejection of a loan application 
from a member of an organization making loans to its membership 
from moneys borrowed from the fund is unwarranted, he may, in his 
discretion, make a direct loan to such individual from the fund. The 
fund shall also be available for administrative expenses incurred in 
connection therewith. 
Economic de- 
SEC. 102. Loaus may be made for any purpose which will promote 
om^uon.' 
the economic development of (a) the individual Indian borrower, 
25 use 1462. 
including loans for educational purposes, and (b) the Indian organi-
zation and its members including loans by such organizations to 
other organizations and investments in other organizations regard-
less of whether they are organizations of Indians: Provided^ That not 
more than 50 per centum of loan made to an organization shall be used 
by such organization for the purpose of making loans to or invest-
ments in non-Indian organizations. 
25 use 1463. 
SEC. 103. Loans may be made only when, in the judgment of the 
Secretary, there is a reasonable prospect of repayment, and only to 
applicants who in the opinion of the Secretary are unable to obtain 
financing from other sources on reasonable terms and conditions. 
Interest rate. 
SEC. 104, Loaus sliall be for terms that do not exceed thirty years 
25 use 1464. 
^^^ shall bear interest at (a) a rate determined by the Secretary of 
the Treasury taking into consideration the market yield on municipal 
bonds: Provided^ That in no event shall the rate be greater than the 
rate determined by the Secretary of the Treasury taking into consider-
ation the current average yield on outstanding marketable obligations 
of the United States of comparable maturity, plus (b) such additional 
charge, if any, toward covering other costs of the program as the Sec-
retary may determine to be consistent with its purpose: Provided^ 
That educational loans may provide for interest to be deferred while 
the borrower is in school or in the military service. 
25 use 1465. 
SEC. 105. The Secretary may cancel, adjust, compromise, or reduce 
the amount of any loan or any portion thereof heretofore or hereafter 
made from the revolving loan fund established by this title and its 
predecessor constituent funds which he determines to be uncollectable 
in whole or in part, or which is collectable only at an unreasonable cost, 
or when such action would, in his judgment, be in the best interests of 
the United States: Provided^ That proceedings pursuant to this sen-
tence shall be effective only after following the procedure prescribed 
by the Act of July 1, 1932 '(47 Stat. 564, 25 U.S.C, 386a), He may also 
adjust, compromise, subordinate, or modify the terms of any mortgage, 
lease, assignment, contract, agreement, or other document taken to 
secure such loans. 
h^"l^'*lV,, 
SEC. 106, Title to any land purchased by a tribe or by an individual 
" """ ' '" 
Indian with loans made from the revolving loan fund may be taken 
25 use 1466. 
88 STAT. ] 
PUBLIC LAW 93-262-APR. 12, 1974 
79 
in trust unless the land is located outside the boundaries of a reserva-
tion or a tribal consolidation area approved by the Secretary. Title 
to any land purchased by a tribe or an individual Indian which is out-
side the boundaries of the reservation or approved consolidation area 
may be taken in trust if the purchaser was the owner of trust or 
restricted interests in the land before the purchase, otherwise title 
shall be taken in the name of the purchasers without any restriction 
on alienation, control, or use. Title to any personal property purchased 
with a loan from the revolving loan fund shall be taken in the name of 
the purchaser. 
SEC. 107, Any organization receiving a loan from the revolving loan 
fund shall be required to assign to the United States as security for 
the loan all securities acquired in connection with the loans made to its 
members from such funds unless the Secretary determines that the 
repayment of the loan to the United States is otherwise reasonably 
assured. 
SEC. 108. There is authorized to be appropriated, to provide capital 
and to restore any impairment of capital for the revolving loan fund 
$50,000,000 exclusive of prior authorizations and appropriations. 
SEC. 109. The Secretary shall promulgate rules and regulations to 
carry out the provisions of this title. 
25 use 1467. 
Appropriation, 
25 use 1468. 
Rules and reg-
ulations. 
25 u s e 1469. 
TITLE II—LOAN GUAKANTY AND INSURANCE 
SEC. 201. In order to provide access to private money sources which 
otherwise would not be available, the Secretary is authorized (a) to 
guarantee not to exceed 90 per centum of the unpaid principal and 
interest due on any loan made to any organization of Indians having 
a form or organization satisfactory to the Secretary, and to individual 
Indians who are not members of or eligible for membership in an 
organization which is making loans to its members; and (b) in lieu 
of such guaranty, to insure loans under an agreement approved by 
the Secretary whereby the lender will be reimbursed for losses in an 
amount not to exceed 15 per centum of the aggregate of such loans 
made by it, but not to exceed 90 per centum of the loss on any one 
loan. 
SEC. 202. The Secretary shall fix such premium charges for the 
insurance and guarantee of loans as are in his judgment adequate to 
cover expenses and probable losses, and deposit receipts from such 
charges in the Indian Loan Guaranty and Insurance Fund established 
pursuant'to section 217(a) of this title. 
SEC. 203. Loans guaranteed or insured pursuant to this title shall 
bear interest (exclusive of premium charges for insurance, and service 
charge, if any) at rates not to exceed such per centum per annum on 
the principal obligation outstanding as the Secretary determines to be 
reasonable taking into consideration the range of interest rates pre-
vailing in the private market for similar loans and the risks assumed 
by the United States. 
SEC. 204. The application for a loan to be guaranteed hereunder shall 
be submitted to the Secretary for prior approval. Upon approval, the 
Secretary shall issue a certificate as evidence of the guaranty. Such 
certificate shall be issued only when, in the judgment of the Secretary, 
there is a reasonable prospect of repayment. No loan to an individual 
Indian may be guaranteed or insured which would cause the total 
unpaid principal indebtedness to exceed $100,000. No loan to an eco-
nomic enterprise (as defined in section 3) in excess of $100,000, or such 
lower amount as the Secretary may determine to be appropriate, shall 
be insured unless prior approval of the loan is obtained from the 
Secretary. 
25 
use 1481. 
Premium 
charges. 
25 
use 1482. 
Interest rate. 
25 use 1483. 
Application. 
25 use 1484. 
25 use 
25 use 
26 use 
seq. 
25 use 
1485. 
1486. 
1 et 
1487. 
80 
PUBLIC LAW 93-262-APR. 12, 1974 
[88 STAT. 
SEC. 205. Any loan guaranteed hereunder, including the security 
given therefor, may be sold or assigned by the lender to any financial 
institution subject to examination and supervision by an agency of the 
United States or of any State or the District of Columbia. 
SEC. 206. Loans made by any agency or instrumentality of the Fed-
eral Government, or by an organization of Indians from funds bor-
rowed from the United States, and loans the interest on which is not 
included in gross income for the purposes of chapter 1 of the Internal 
Revenue Code of 1954, as amended, shall not be eligible for guaranty 
or insurance hereunder. 
SEC. 207. Any loans insured hereunder shall be restricted to those 
made by a financial institution subject to examination and supervision 
by an agency of the United States, a State, or the District of Colum-
bia, and to loans made by Indian organizations from their own funds 
to other tribes or organizations of Indians. 
25 use 1488. 
SEC. 208. Loans guaranteed hereunder may be made by any lender 
satisfactory to the Secretary, except as provided in section 206. The 
liability under the guaranty shall decrease or increase pro rata with 
any decrease or increase in the unpaid portion of the obligation. 
25 use 1489. 
SEC. 209. Any loan made bj^ any national bank or Federal savings 
and loan association, or by any bank, trust company, building and loan 
association, or insurance company authorized to do business in the 
District of Columbia, at least 20 per centum of which is guaranteed 
hereunder, may be made without regard to the limitations and restric-
tions of any other Federal statute with respect to (a) ratio of amount 
of loan to the value of the property; (b) maturity of loans; (c) 
requirement of mortgage or other security; (d) priority of lien; or 
(e) percentage of assets which may be invested in real estate loans. 
Loans, matu- 
SEC. 210. The maturity of any loan guaranteed or insured hereunder 
2
^
5 use 1490. 
shall not exceed thirty years. 
Defaults. 
SEC. 211. In the event of a default of a loan guaranteed hereunder, 
25 use 1491. 
^Y^^ holder of the guaranty certificate may immediately notify the 
Secretary in writing of such default and the Secretary shall thereupon 
pay to such holder the pro rata portion of the amount guaranteed and 
shall be subrogated to the rights of the holder of the guaranty and 
receive an assignment of the obligation and security. The Secretary 
may cancel the uncollectable portion of any obligation, to which he 
has an assignment or a subrogated right under this section: Provided, 
That proceedings pursuant to this sentence shall be effective only after 
following the procedure prescribed by the Act of July 1, 1932 (47 
Stat. 564, 25 U.S.C. 386a). Nothing in this section shall be construed 
to preclude any forbearance for the benefit of the borrower as may be 
agreed upon by the parties to the loan and approved by the Secretary. 
The Secretary may establish the date, not later than the date of judg-
ment and decree of foreclosure or sale, upon which accrual of interest 
or charges shall cease. 
h°^,f<f^',.f>o 
S^c- ^12- When a lender suffers a loss on a loan insured hereunder, 
oc T
T
o
r
. ,„r>o 
including accrued interest, a claim therefor shall be submitted to the 
Secretary. If the Secretary finds that the loss has been suffered, he 
shall reimburse the lender therefor: Provided, That the amount pay-
able to the lender for a loss on any one loan shall not exceed 90 per 
centum of such loss: Provided further, That no reimbursement may 
be made for losses in excess of 15 per centum of the aggregate of 
insured loans made by the lender: Provided further, That before any 
reimbursement is made, all reasonable collection efforts shall have been 
exhausted by the lender, and the security for the loan shall have been 
liquidated to the extent feasible, and the proceeds applied on the debt. 
Upon reimbursement, in w^hole or in part, to the lender, the note or 
judgment evidencing the debt shall be assigned to the United States, 
25 use 1492. 
88 STAT. ] 
PUBLIC LAW 93-262-APR. 12, 1974 
81 
and the lender shall have no further claim against the borrower or the 
United States. The Secretary shall then take such further collection 
action as may be warranted, or may cancel the uncollectable portion 
of any debt assigned pursuant hereto. The Secretary may establish 
a date upon which accrual of interest or charges shall cease. 
SEC. 213. Whenever the Secretary finds that any lender or holder of ,„^°ft'j;„\^""^^' 
a guaranty certificate fails to maintain adequate accounting records, 
25 use 1493. 
or to demonstrate proper ability to service adequately loans guaran-
teed or insured, or to exercise proper credit judgment, or has willfully 
or negligently engaged in practices otherwise detrimental to the 
interests of a borrower or of the United States, he may refuse, either 
temporarily or permanently, to guarantee or insure any further loans 
made by such lender or holder, and may bar such lender or holder 
from acquiring additional loans guaranteed or insured hereunder: 
Provided^ That the Secretary shall not refuse to pay a valid guaranty 
or insurance claim on loans previously made in good faith. 
SEC. 214. Any evidence of guaranty or insurance issued by the Sec- 
Eligibility. 
retary shall be conclusive evidence of the eligibility of the loan for 
guaranty or insurance under the provisions of this Act and the amount 
of such guaranty or insurance: Provided^ That nothing in this section 
shall preclude the Secretary from establishing, as against the original 
lender, defenses based on fraud or material misrepresentation or bar 
him from establishing, by regulations in force at the date of such 
issuance or disbursement, whichever is the earlier, partial defenses to 
the amount payable on the guaranty or insurance. 
SEC. 215. Title to any land purchased by a tribe or by an individual 
'^^'^'^ titles. 
Indian with loans guaranteed or insured pursuant to this title may 
be taken in trust, unless the land is located outside the boundaries of 
a reservation or a tribal consolidation area approved by the Secretary. 
Title to any land purchased by a tribe or an individual Indian which 
is outside the boundaries of the reservation or approved consolida-
tion area may be taken in trust if the purchaser was the owner of 
trust or restricted interests in the land before the purchase, otherwise 
title shall be taken in the name of the purchaser without any restric-
tion on alienation, control, or use. Title to any personal property pur-
chased with loans guaranteed or insured hereunder shall be taken in 
the name of the purchaser. 
SEC. 216. The financial transactions of the Secretary incident to or 
25 use 1496. 
arising out of the guarantee or insurance of loans, and the acquisition, 
management, and disposition of property, real, personal, or mixed, 
incident to such activities, shall be final and conclusive upon all officers 
of the Government. With respect to matters arising out of the guar-
anty or insurance program authorized by this title, and notwithstand-
ing the provisions of any other laws, the Secretary may— 
(a) sue and be sued in his official capacity in any court of com-
petent jurisdiction; 
(b) subject to the specific limitations in this title, consent to 
the modification, with respect to the rate of interest, time of 
payment on principal or interest or any portion thereof, security, 
or any other provisions of any note, contract, mortgage, or other 
instrument securing a loan which has been guaranteed or insured 
hereunder; 
(c) subject to the specific limitations in this title, pay, or com-
promise, any claim on, or arising because of any loan guaranty or 
insurance; 
(d) subject to the specific limitations in this title, pay, com-
promise, waive, or release any right, title, claim, lien, or demand, 
however acquired, including, but not limited to, any equity or 
right of redemption; 
82 
PUBLIC LAW 93-262-APR. 12, 1974 
[88 STAT. 
Indian Loan 
Guaranty and 
Insurance Fund. 
25 use 1497. 
Rules and reg-
ulations. 
25 u s e 1498. 
(e) purchase at any sale, public or private, upon such terms 
and for such prices as he determines to be reasonable, and take 
title to property, real, personal, or mixed; and similarly sell, at 
public or private sale, exchange, assign, convey, or otherwise dis-
pose of such property; and 
(f) complete, administer, operate, obtain, and pay for insur-
ance on, and maintain, renovate, repair, modernize, lease, or other-
wise deal with any property acquired or held pursuant to the 
guaranty or insurance program authorized by this title. 
SEC. 217. (a) There is hereby created an Indian Loan Guaranty and 
Insurance Fund (hereinafter referred to as the "fund") which shall 
be available to the Secretary as a revolving fund without fiscal year 
limitation for carrying out the provisions of this title. 
(b) The Secretary may use the fund for the purpose of fulfilling the 
obligations with respect to loans guaranteed or insured under this 
title, but the aggregate of such loans which are insured or guaranteed 
by the Secretary shall be limited to $200,000,000. 
(c) All funds, claims, notes, mortgages, contracts, and property 
acquired by the Secretary under this section, and all collections and 
proceeds therefrom, shall constitute assets of the fund; and all liabili-
ties and obligations of such assets shall be liabilities and obligations 
of the fund. The Secretary is authorized to make agreements with 
respect to servicing loans held, guaranteed, or insured by him under 
this title and purchasing such guaranteed or insured loans on such 
terms and conditions as he may prescribe. 
(d) The Secretary may also utilize the fund to pay taxes, insurance, 
prior liens, expenses necessary to make fiscal adjustments in connec-
tion with the application and transmittal of collections, and other 
expenses and advances to protect the Secretary for loans which are 
guaranteed or insured under this title or held by the Secretaiy, to 
acquire such security property at foreclosure sale or otherwise, and to 
pay administrative expenses. 
SEC. 218. The Secretary shall promulgate rules and regulations to 
carry out the provisions of this title. 
TITLE III—INTEREST SUBSIDIES AND 
ADMINISTRATIVE 
E X P E N S E S 
25 u s e 1511. 
Appropriation. 
25 u s e 1512. 
SEC. 301. The Secretary is authorized under such rules and regula-
tions as he may prescribe to pay as an interest subsidy on loans which 
are guaranteed or insured under the provisions of title II of this Act 
amounts which are necessary to reduce the rate payable by the bor-
rower to the rate determined under section 104 of this Act. 
SEC. 302. There are authorized to be appropriated to the Secretary 
(a) to carry out the provisions of sections 217 and 301 of this Act, such 
sums to remain available until expended, and (b) for administrative 
expenses under this Act not to exceed $20,000,000 in each of the fiscal 
years 1975,1976, and 1977. 
TITLE IV—INDIAN BUSINESS GRANTS 
Indian Busi-
ness Develop-
ment Program. 
Establishment. 
25 use 1521. 
SEC. 401. There is established within the Department of the Interior 
the Indian Business Development Program whose purpose is to stimu-
late and increase Indian entrepreneurship and employment by provid-
ing equity capital through nonreimbursable grants made by the 
Secretary of the Interior to Indians and Indian tribes to establish and 
expand profit-making Indian-owned economic enterprises on or near 
reservations. 
88 STAT. ] 
PUBLIC LAW 93-263-APR. 12, 1974 
83 
SEC. 402. (a) No orant in excess of $50,000, or such lower amount 
conditions. 
as the Secretary may determme to be appropriate, may be made to an 
= ^^-^ = • 
Indian or Indian tribe. 
(b) A grant may be made only to an applicant who, in the opinion 
of the Secretary, is unable to obtain adequate financing for its eco-
nomic enterprise from other sources: Provided^ That prior to making 
any grant under this title, the Secretary shall assure that, where practi-
cal, the applicant has reasonably made available for the economic 
enterprise funds from the applicant's own financial resources. 
(c) No grant may be made to an applicant who is unable to obtain 
at least 60 per centum of the necessary funds for the economic enter-
prise from other sources. 
SEC. 403. There are authorized to be appropriated not to exceed the Appropriation. 
sum of $10,000,000 for each of the fiscal years 1975,1976, and 1977 for 
^^ ^^^ '"^• 
the purposes of this title. 
SEC. 404. The Secretary of the Interior is authorized to prescribe ^i^^^^^^g ^"'^ ''^^" 
such rules and regulations as may be necessary to carry out the pur- 
25 use is24. 
poses of this Act. 
TITLE V 
SEC. 501. Concurrent with the making or guaranteeing of any loan 
25 use 1541. 
under titles I and I I and with the making of a grant under title IV of 
this Act, the purpose of which is to fund the development of an eco-
nomic enterprise, the Secretary shall insure that the loan or grant 
applicant shall be provided competent management and technical 
assistance consistent with the nature of the enterprise being funded. 
SEC. 502. For the purpose of providing the assistance required under ^^ff^"^""^ cooper-
section 501, the Secretary is authorized to cooperate with the Small °'"" 
Business Administration and ACTION and other Federal agencies in 
the use of existing programs of this character in those agencies. In 
addition, the Secretary is authorized to enter into contracts with 
private organizations for providing such services and assistance. 
SEC. 503. For the purpose of entering into contracts pursuant to 
Funds, umita-
section 502 of this title, the Secretary is authorized to use not to 
exceed 5 per centum of any funds appropriated for any fiscal year 
pursuant to section 302 of this Act. 
Approved April 12, 1974. ' 
Public Law 93-263 
AN ACT 
April 12, 1974 
To amend the Foreign Service Buildings Act, 1926, to authorize additional 
[H. R. 12465] 
appropriations for the fiscal year 1974. 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled^ That subsection (g) 
Foreign service 
of section 4 of the Foreign Service Buildings Act, 1926 (22 U.S.C. ^igie'T^enl^' 
295), is amended— 
ments. 
(1) by striking out "$590,000" in subparagraph (1)(A) and 
inserting in lieu thereof "$631,000"; 
(2) by striking out "$160,000" in subparagraph (1) (C) and 
inserting in lieu thereof "$204,000"; 
(3) by striking out "$2,218,000" in subparagraph (1) (E) and 
inserting in lieu thereof "$2,287,000"; and 
(4) by striking out "$45,800,000" and "$21,700,000" in para-
graph (2) and inserting in lieu thereof "$48,532,000" and 
"$23,066,000", respectively. 
Approved April 12, 1974. 
ation. 
25 use 1542. 
tion. 
25 use 1543.