22 U.S.C. § 2186 : US Code - Section 2186: Loan guarantees to Israel program

Search 22 U.S.C. § 2186 : US Code - Section 2186: Loan guarantees to Israel program

(a) In general
Subject to the terms and conditions of this section, during the
period beginning October 1, 1992, and ending September 30, 1997,
the President is authorized to issue guarantees against losses
incurred in connection with loans to Israel made as a result of
Israel's extraordinary humanitarian effort to resettle and absorb
immigrants into Israel from the republics of the former Soviet
Union, Ethiopia and other countries. In the event that less than
the full amount authorized to be issued under subsection (b) of
this section is issued in such period, the authority to issue the
balance of such guarantees shall be available in the fiscal year
ending on September 30, 1998.
(b) Fiscal year levels
The President is authorized to issue guarantees in furtherance of
the purposes of this section. Subject to subsection (d) of this
section, the total principal amount of guarantees which may be
issued by the President under this section shall be up to
$10,000,000,000 which may be issued as follows:
(1) in fiscal year 1993, up to $2,000,000,000 may be issued on
October 1, 1992 or thereafter;
(2) subject to subsection (d) of this section, in fiscal years
1994 through 1997, up to $2,000,000,000 in each fiscal year may
be issued on October 1 or thereafter.
(3) If less than the full amount of guarantees authorized to be
made available in a fiscal year pursuant to paragraphs (1) and
(2) of this subsection is issued to Israel during that fiscal
year, the authority to issue the balance of such guarantees shall
extend to any subsequent fiscal year ending on or before
September 30, 1998.
(4)(A) Not later than September 1 of each year during the
period in which the President is authorized to issue loan
guarantees under subsection (a) of this section, beginning in
fiscal year 1993, the President shall notify the appropriate
congressional committees in writing of his intentions regarding
the exercise of that authority for the fiscal year beginning on
October 1 of that year, including a statement of the total
principal amount of guarantees, if any, that the President
proposes to issue for that fiscal year.
(B) For purposes of this paragraph, the term "appropriate
congressional committees" means the Committee on Appropriations
and the Committee on Foreign Relations of the Senate and the
Committee on Appropriations and the Committee on Foreign Affairs
of the House of Representatives.
(c) Use of guarantees
Guarantees may be issued under this section only to support
activities in the geographic areas which were subject to the
administration of the Government of Israel before June 5, 1967.
(d) Limitation on guarantee amount
The amount of authorized but unissued guarantees that the
President is authorized to issue as specified in subsection (b) of
this section shall be reduced by an amount equal to the amount
extended or estimated to have been extended by the Government of
Israel during the previous year for activities which the President
determines are inconsistent with the objectives of this section or
understandings reached between the United States Government and the
Government of Israel regarding the implementation of the loan
program. The President shall submit a report to Congress no later
than September 30 of each fiscal year during the pendency of the
program specifying the amount calculated under this subsection and
that will be deducted from the amount of guarantees authorized to
be issued in the next fiscal year.
(e) Fees
(1) Fees charged for the loan guarantee program under this
section each year shall be an aggregate annual origination fee
equal to the estimated subsidy cost of the guarantees issued under
this section for that year, calculated by the Office of Management
and Budget for the Federal Credit Reform Act of 1990 [2 U.S.C. 661
et seq.]. This shall also include an amount for the administrative
expenses of the Agency for International Development in
administering the program under this section. All such fees shall
be paid by the Government of Israel to the Government of the United
States. Funds made available for Israel under part 4 of subchapter
II of this chapter, may be utilized by the Government of Israel to
pay such fees to the United States Government. No further
appropriations of subsidy cost are needed for the loan guarantee
authorized hereunder for fiscal year 1993 and the four succeeding
fiscal years.
(2) The origination fee shall be payable to the United States
Government on a pro rata basis as each guarantee for each loan or
increment is issued.
(f) Authority to suspend
Except as provided in subsections (l) and (m) of this section,
the President shall determine the terms and conditions for issuing
guarantees. If the President determines that these terms and
conditions have been breached, the President may suspend or
terminate the provision of all or part of the additional loan
guarantees not yet issued under this section. Upon making such a
determination to suspend or terminate the provision of loan
guarantees, the President shall submit to the Speaker of the House
of Representatives and the President Pro Tempore of the Senate his
determination to do so, including the basis for such suspension or
termination.
(g) Procedures for suspension or termination
Any suspension or termination pursuant to subsection (f) of this
section shall be in accordance with the following procedures:
(1) Upon making a determination to suspend or terminate the
provision of loan guarantees, the President shall submit to the
Speaker of the House of Representatives and the President Pro
Tempore of the Senate his determination to do so, including the
basis for such suspension or termination.
(2) Such a suspension or termination shall cease to be
effective if Congress enacts, within 30 days of submission, a
joint resolution authorizing the assistance notwithstanding the
suspension.
(3) Any such joint resolution shall be considered in the Senate
in accordance with the provisions of section 601(b) of the
International Security Assistance and Arms Export Control Act of
1976.
(4) For the purpose of expediting the consideration and
enactment of joint resolutions under this subsection, a motion to
proceed to the consideration of any such joint resolution after
it has been reported by the appropriate committee shall be
treated as highly privileged in the House of Representatives.
(5) In the event that the President suspends the provision of
additional loan guarantees under subsection (f) of this section
and Congress does not enact a joint resolution pursuant to this
subsection, the provision of additional loan guarantees under the
program established by this section may be resumed only if the
President determines and so reports to Congress that the reasons
for the suspension have been resolved or that the resumption is
otherwise in the national interest.
(h) Economic context
The effective absorption of immigrants into Israel from the
republics of the former Soviet Union and Ethiopia within the
private sector requires large investment and economic restructuring
to promote market efficiency and thereby contribute to productive
employment and sustainable growth. Congress recognizes that the
Government of Israel is developing an economic strategy designed to
achieve these goals, and that the Government of Israel intends to
adopt a comprehensive, multi-year economic strategy based on
prudent macroeconomic policies and structural reforms. Congress
also recognizes that these policies are being designed to reduce
direct involvement of the government in the economic system and to
promote private enterprise, important prerequisites for economic
stability and sustainable growth.
(i) Consultations
It is the sense of the Congress that, as agreed between the two
Governments and in order to further the policies specified in
subsection (h) of this section, Israel and the United States should
continue to engage in consultations concerning economic and
financial measures, including structural and other reforms, that
Israel should undertake during the pendency of this program to
enable its economy to absorb and resettle immigrants and to
accommodate the increased debt burden that will result from loans
guaranteed pursuant to this section. It is the sense of the
Congress that these consultations on economic measures should
address progress and plans in the areas of budget policies,
privatization, trade liberalization, financial and capital markets,
labor markets, competition policy, and deregulation.
(j) Goods and services
During the pendency of the loan program authorized under this
section, it is anticipated that, in the context of the economic
reforms undertaken pursuant to subsections (h) and (i) of this
section, Israel's increased population due to its absorption of
immigrants, and the liberalization by the Government of Israel of
its trade policy with the United States, the amount of United
States investment goods and services purchased for use in or with
respect to the country of Israel will substantially increase.
(k) Reports
The President shall report to Congress by December 31 of each
fiscal year until December 31, 1999, regarding the implementation
of this section.
(l) Applicability of certain sections
Section 2183 of this title shall apply to guarantees issued under
subsection (a) of this section in the same manner as such section
applies to guarantees issued under section 2182 of this title,
except that subsections (a), (e)(1), (g), and (j) of section 2183
of this title shall not apply to such guarantees and except that,
to the extent section 2183 of this title is inconsistent with the
Federal Credit Reform Act of 1990 [2 U.S.C. 661 et seq.], that Act
shall apply. Loans shall be guaranteed under this section without
regard to sections 2181, 2182, and 2198(c) of this title.
Notwithstanding section 2183(f) of this title, the interest rate
for loans guaranteed under this section may include a reasonable
fee to cover the costs and fees incurred by the borrower in
connection with this program or financing under this section in the
event the borrower elects not to finance such costs or fees out of
loan principal. Guarantees once issued hereunder shall be
unconditional and fully and freely transferable.
(m) Terms and conditions
(1) Each loan guarantee issued under this section shall guarantee
100 percent of the principal and interest payable on such loans.
(2) The standard terms of any loan or increment guaranteed under
this section shall be 30 years with semiannual payments of interest
only over the first 10 years, and with semiannual payments of
principal and interest on a level payment basis, over the last 20
years thereof, except that the guaranteed loan or any increments
issued in a single transaction may include obligations having
different maturities, interest rates, and payment terms if the
aggregate scheduled debt service for all obligations issued in a
single transaction equals the debt service for a single loan or
increment of like amount having the standard terms described in
this sentence. The guarantor shall not have the right to accelerate
any guaranteed loan or increment or to pay any amounts in respect
of the guarantees issued other than in accordance with the original
payment terms of the loan. For purposes of determining the maximum
principal amount of any loan or increment to be guaranteed under
this section, the principal amount of each such loan or increment
shall be -
(A) in the case of any loan issued on a discount basis, the
original issue price (excluding any transaction costs) thereof;
or
(B) in the case of any loan issue (!1) on an interest-bearing
basis, the stated principal amount thereof.