[Code of Federal Regulations]
[Title 7, Volume 11]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1779.24]

[Page 1012-1013]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER XVII--RURAL UTILITIES SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 1779--WATER AND WASTE DISPOSAL PROGRAMS GUARANTEED LOANS--Table of Contents
 
Sec. 1779.24  Eligible loan purposes.

    (a) To construct, enlarge, extend, or otherwise improve rural 
drinking water, sanitary sewage, solid waste disposal, and storm 
wastewater disposal facilities.
    (b) To construct or relocate public buildings, roads, bridges, 
fences, or utilities, and to make other public improvements necessary 
for the successful operation or protection of facilities authorized in 
paragraph (a) of this section.
    (c) To relocate private buildings, roads, bridges, fences, or 
utilities, and other private improvements necessary for the successful 
operation or protection of facilities authorized in paragraph (a) of 
this section.
    (d) For payment of other utility connection charges as provided in 
service contracts between utility systems.
    (e) When a necessary part of the project relates to those facilities 
authorized in paragraphs (a), (b), (c) or (d)

[[Page 1013]]

of this section the following may be considered:
    (1) Reasonable fees and costs such as: legal, engineering, 
administrative services, fiscal advisory, recording, environmental 
analyses and surveys, possible salvage or other mitigation measures, 
planning, establishing or acquiring rights;
    (2) Costs of acquiring interest in land: rights, such as water 
rights; leases; permits; rights-of-way; and other evidence of land or 
water control or protection necessary for development of the facility;
    (3) Purchasing or renting equipment necessary to install, operate, 
maintain, extend, or protect facilities;
    (4) Cost of additional applicant labor and other expenses necessary 
to install and extend service;
    (5) In unusual cases such as a low-income area, the cost for 
connecting the user to the main service line;
    (6) Interest incurred during construction in conjunction with 
multiple advances or interest on interim financing;
    (7) Initial operating expenses, including interest, for a period 
ordinarily not exceeding one year when the applicant is unable to pay 
such expenses;
    (8) The purchase of existing facilities when it is necessary either 
to improve service or prevent the loss of service; and
    (9) Refinancing non-Agency debts incurred by, or on behalf of, an 
applicant when all of the following conditions exist:
    (i) The debts being refinanced are a secondary part of the total 
loan unless the debt being refinanced is an Agency direct loan;
    (ii) The debts were incurred for the facility or service being 
financed or any part thereof; and
    (iii) Arrangements cannot be made with the creditors to extend or 
modify the terms of the debts so that a sound basis will exist for 
making a loan.
    (10) Refinancing Agency debts.