§ 4743. — Approving States for participation.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC4743]
TITLE 12--BANKS AND BANKING
CHAPTER 47--COMMUNITY DEVELOPMENT BANKING
SUBCHAPTER II--SMALL BUSINESS CAPITAL ENHANCEMENT
Sec. 4743. Approving States for participation
(a) Application
Any State may apply to the Fund for approval to be a participating
State under the Program and to be eligible for reimbursement by the Fund
pursuant to section 4747 of this title.
(b) Approval criteria
The Fund shall approve a State to be a participating State, if--
(1) a specific department or agency of the State has been
designated to implement the Program;
(2) all legal actions necessary to enable such designated
department or agency to implement the Program have been
accomplished;
(3) funds in the amount of at least $1 for every 2 people
residing in the State (as of the last decennial census for which
data have been released) are available and have been legally
committed to contributions by the State to reserve funds, with such
funds being available without time limit and without requiring
additional legal action, except that such requirements shall not be
construed to limit the authority of the State to take action at a
later time that results in the termination of its obligation to
enroll loans and make contributions to reserve funds;
(4) the State has prescribed a form of participation agreement
to be entered into between it and each participating financial
institution that is consistent with the requirements and purposes of
this subchapter; and
(5) the State and the Fund have executed a reimbursement
agreement that conforms to the requirements of this subchapter.
(c) Existing State programs
(1) In general
A State that is not a participating State, but that has its own
capital access program providing portfolio insurance for business
loans (based on a separate loss reserve fund for each financial
institution), may apply at any time to the Fund to be approved to be
a participating State. The Fund shall approve such State to be a
participating State, and to be eligible for reimbursements by the
Fund pursuant to section 4747 of this title, if the State--
(A) satisfies the requirements of subsections (a) and (b) of
this section; and
(B) certifies that each affected financial institution has
satisfied the requirements of section 4744 of this title.
(2) Applicable terms of participation
(A) Status of institutions
If a State is approved for participation under paragraph
(1), each financial institution with a participation agreement
in effect with the participating State shall immediately be
considered a participating financial institution. Reimbursements
may be made under section 4747 \1\ of this title in connection
with all contributions made to the reserve fund by the State in
connection with lending that occurs on or after the date on
which the Fund approves the State for participation.
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\1\ See References in Text note below.
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(B) Effective date of participation
If an amended participation agreement that conforms with
section 4745 of this title is required in order to secure
participation approval by the Fund, contributions subject to
reimbursement under section 4747 of this title shall include
only those contributions made to a reserve fund with respect to
loans enrolled on or after the date that an amended
participation agreement between the participating State and the
participating financial institution becomes effective.
(C) Use of accumulated reserve funds
A State that is approved for participation in accordance
with this subsection may continue to implement the program \2\
utilizing the reserve funds accumulated under the State program.
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\2\ So in original. Probably should be capitalized.
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(d) Prior appropriations requirement
The Fund shall not approve a State for participation in the Program
until at least $50,000,000 has been appropriated to the Fund (subject to
an appropriations Act), without fiscal year limitation, for the purpose
of making reimbursements pursuant to section 4747 of this title and
otherwise carrying out this subchapter.
(e) Amendments to agreements
If a State that has been approved to be a participating State wishes
to amend its form of participation agreement and continue to be a
participating State, such State shall submit such amendment for review
by the Fund in accordance with subsection (b)(4) of this section. Any
such amendment shall become effective only after it has been approved by
the Fund.
(Pub. L. 103-325, title II, Sec. 253, Sept. 23, 1994, 108 Stat. 2205.)
References in Text
Section 4747 of this title, referred to in subsec. (c)(2)(A), was in
the original ``section 237'' and was translated as reading ``section
257'' meaning section 257 of Pub. L. 103-325, to reflect the probable
intent of Congress. Pub. L. 103-325 does not contain a section 237.
Section Referred to in Other Sections
This section is referred to in sections 4742, 4746, 4748 of this
title.
