[Code of Federal Regulations]
[Title 24, Volume 3]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 24CFR570.432]

[Page 101]
 
                 TITLE 24--HOUSING AND URBAN DEVELOPMENT
 
  CHAPTER V--OFFICE OF ASSISTANT SECRETARY FOR COMMUNITY PLANNING AND 
        DEVELOPMENT, DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
 
PART 570_COMMUNITY DEVELOPMENT BLOCK GRANTS--Table of Contents
 
                     Subpart F_Small Cities Program
 
Sec. 570.432  Repayment of section 108 loans.

    Notwithstanding any other provision of this subpart, a unit of 
general local government in a nonentitlement area where the State has 
not elected to administer the CDBG program shall be eligible for Small 
Cities Grant assistance hereunder for the sole purpose of paying any 
amounts due on debt obligations issued by such unit of general local 
government (or its designated public agency) and guaranteed by the 
Secretary pursuant to section 108 of the Act (see subpart M of this 
part). The award of grant assistance for such purpose shall be 
consistent with section 106(d)(3)(B) of the Act, in such amount, and 
subject to such conditions as the Secretary may determine. Since 
guaranteed loan funds (as defined in Sec. 570.701) are required to be 
used in accordance with national and primary objective requirements, and 
other applicable requirements of this part, any grant made to make 
payments on the debt obligations evidencing the guaranteed loan shall be 
presumed to meet such requirements, unless HUD determines that the 
guaranteed loan funds were not used in accordance with such 
requirements. Any such determination by HUD shall not prevent the making 
of the grant in the amount of the payment due, but it may be grounds for 
HUD to take appropriate action under subpart O of this part based on the 
original noncompliance.