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Pennsylvania Code (Last Updated: April 5, 2016) |
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Title 12. COMMERCE, TRADE AND LOCAL GOVERNMENT |
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PART V. Community Affairs and Development |
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Subpart C. Community Development and Housing |
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Chapter 141. Community Development Grant Program |
Section 141.307. Limitations on loan commitments—public entities
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(a) The repayment period for a guaranteed loan may not exceed 20 years.
(b) The security offered by the Department to HUD will include a pledge of all grants made to the State or for which the State may become eligible under applicable Federal law and regulations.
(c) The State may provide an additional guarantee from sources other than the public entity’s annual CDBG grant. The additional State guarantee will supersede the use of the public entity’s CDBG grant funds as a source to guarantee debt payments for a section 108 loan.
(d) A public entity shall pledge the full amount of CDBG grants to be received during the period of the loan guarantee. Grant amounts for any year sufficient to pay current debt service may not be expended until the debt service for that year has been paid, or until the public entity provides the Department with satisfactory evidence that funds to pay current debt service have been placed in a trust account.
(e) Loans must be amortized on an annual basis, unless otherwise approved in writing by the Department.
(f) A public entity shall enter into a contract with the Department and HUD, in a form acceptable to the Department and HUD, for the repayment of notes or other obligations guaranteed under this section, § § 141.301—141.305, 141.308 and 141.309.
(g) Security in addition to a pledge of CDBG allocations will be required when the pledge of the allocations is not sufficient to protect all of the potential liability of the Department.
The provisions of this § 141.307 adopted August 21, 1992, effective August 22, 1992, 22 Pa.B. 4313; amended January 20, 2006, effective January 21, 2006, 36 Pa.B. 283. Immediately preceding text appears at serial pages (231105) to (231106).
Notation
The provisions of this § 141.307 issued under the Community Development Block Grant Entitlement Program for Nonurban Counties and Certain Other Municipalities (35 P. S. § § 1751—1765).
This section cited in 12 Pa. Code § 141.301 (relating to purpose); 12 Pa. Code § 141.302 (relating to definitions); 12 Pa. Code § 141.308 (relating to CDBG requirement); and 12 Pa. Code § 141.309 (relating to Department approval).