897 

 11 



templated, be underwritten upon terms and conditions approved by 

 the Secretary ; 



"(B) bear interest at a rate satisfactory to the Secretary; 

 "(C) contain or be subject to repayment, maturity, and other pro- 

 visions satisfactory to the Secretary ; and 



"(D) contain or be subject to provisions with respect to the protection 

 of the security interest of the United States ; 

 "(6) the approval of the Secretary of the Treasury shall be required with 

 respect to any guarantee made under this section, except that the Secretary 

 of the Treasury may waive this requirement with respect to the issuing of any 

 such obligation when he determines that such issuing does not have a sig- 

 nificant impact on the market for Federal Government and Federal Govern- 

 ment-guaranteed securities ; 



"(7) the Secretary determines that there is reasonable assurance that 

 the issuer of the evidence of indebetedness will be able to make the payments 

 of the principal of and interest on such evidence of indebtedness ; and 

 "(8) no guarantee shall be made after September 30, 1981. 

 "(d) (1) Prior to the time when the first bond or other evidence of indebtedness 

 is guaranteed under this section, the Secretary shall publish in the Federal 

 Register a list of the proposed terms and conditions under which bonds and 

 other evidences of indebtedness will be guaranteed under this section. For at 

 least thirty days following such publication, the Secretary shall receive, and give 

 consideration to, comments from the public concerning such terms and conditions. 

 Following this period, the Secretary shall publish in the Federal Register a 

 final list of the conditions under which bonds and other evidences will be guar- 

 anteed under this section. The initial guarantee made under this section may 

 not be conducted until thirty days after the final list of terms and conditions 

 Ls published. 



"(2) Prior to making any amendment to such final list of terms and conditions, 

 the Secretary shall publish such amendment in the Federal Register and receive, 

 ana give consideration to, comments from the public for at least thirty days 

 following such publication. Following this period, the Secretary shall publish in 

 the Federal Register the final form of the amendment, and such amendment shall 

 not become effective until thirty days after this publication. 



"(e) The full faith and credit of the United States is pledged to the payment 

 of all guarantees made under this section with respect to principal, interest, and 

 any redemption premiums. Any such guarantee made by the Secretary shall 

 be conclusive evidence of the eligibility of the obligation involved for such 

 guarantee, and the validity of any guarantee so made shall be incontestable in 

 the hands of a holder of the guaranteed obligation. 



"(f) The Secretary shall prescribe and collect a fee in connection with 

 guarantees made under this section. This fee may not exceed the amount which 

 the Secretary estimates to be necessary to cover the administrative costs of 

 carrying out this section. Fees collected under this subsection shall be deposited 

 in the revolving fund established under subsection (i). 



"(g) With respect to any obligation guaranteed under this section, the in- 

 terest payment paid on such obligation and received by the purchaser thereof 

 (or his successor in interest) shall be included in gross Income for the purpose 

 of chapter 1 of the Internal Revenue Code of 1954. 



"(h)(1) Payments required to be made as a result of any guarantee made 

 under this section shall be made by the Secretary from funds which may be ap- 

 propriated to the revolving fund established by subsection (i) or from funds 

 obtained from the Secretary of the Treasury and deposited in such revolving 

 fund pursuant to subsection ( i ) ( 2 ) . 



"(2) If there is a default by a coastal state or unit of general purpose local 

 government in any payment of principal or interest due under a bond or other 

 evidence of indebtedne.ss guaranteed by the Secretary under this section, any 

 liolder of such bond or other evidence of indebtetlness may demand payment by 

 the Secretary of the unpaid interest on and the unpaid principal of such obliga- 

 tion as they become due. The Secretary, after investigating the facts presented 

 by the holder, shall pay to the holder the amount which is due him, unless the 

 Secretary finds that there was no default by the coastal state or unit of general 

 purpose local government or that such default has been remedial. If the 

 Secretary makes a payment under this paragraph, the United States shall have 

 a right of reinibursenient against the coastal state or unit of general puri)o.se 

 local government for which the payment was made for the amount of .such 



