§ 1944.173 - Loan and grant approval—delegation of authority.

The State Director and District Director are authorized to approve loans and/or grants in accordance with this subpart and subpart A of part 1901 of this chapter. The State Director may delegate loan or grant approval in writing to State Office employees other than District Directors. No LH grant may be approved by the State Director without the prior consent of the National Office.

(a) Action before loan or grant approval. The loan or grant approval official is responsible for reviewing the docket to determine that the proposed loan and/or grant complies with all pertinent regulations, instructions, and directives. In making this review, the approval official will determine that:

(1) The applicant is eligible.

(2) The funds are requested for authorized purposes.

(3) The proposed loan or grant is sound.

(4) The security is adequate for the loan.

(5) All preapproval requirements have been met.

(6) Compliance with title VI of the Civil Rights Act will be met.

(7) All other requirements will be met.

(b) Approval of loan or grant. When a loan or grant is approved:

(1) The approving official will prepare and sign Form FmHA or its successor agency under Public Law 103-354 1944-51 in an original and one copy. The State Director, District Director or a designee will record the obligation of loan and/or grant funds for the project through a field office terminal in accordance with the FMI for Form FmHA or its successor agency under Public Law 103-354 1944-51 and the MFH User Procedure.

(2) The individual obligating the loan or grant will record the date and time of the obligation and sign Form FmHA or its successor agency under Public Law 103-354 1944-51 in accordance with the FMI.

(3) The obligation date of loan and/or grant funds will be confirmed through use of field terminals the following work day.

(4) The Finance Office will mail the State Office Form FmHA or its successor agency under Public Law 103-354 1944-57, “MFH Acknowledgement of Obligated Funds/Check Request,” confirming the reservation of funds with the obligation date inserted as required by the FMI for Form FmHA or its successor agency under Public Law 103-354 1944-57. Form FmHA or its successor agency under Public Law 103-354 1944-57 will be prepared and distributed in accordance with the FMI.

(5) Form FmHA or its successor agency under Public Law 103-354 1944-51 will not be mailed to the Finance Office unless there is an excessive time period in which the terminals are not operable. Immediately after confirming the reservation of funds for not-for-profit organizations and public bodies, through use of the terminal operating station, the State Director will call the Information Division in the National Office as required by subpart C of part 2015 of this chapter. Notice of approval to the applicant will be accomplished by mailing the applicant's signed copy of Form FmHA or its successor agency under Public Law 103-354 1944-51 on the obligation date. The State Director, District Director or a designee will record the actual date of applicant notification on the original of Form FmHA or its successor agency under Public Law 103-354 1944-51 and include the original of the form as a permanent part of the District Office project file with a copy in the State Office file.

(6) Determine the maximum rental rates to be charged domestic farm labor for occupancy of the housing, and advise the applicant, in writing, of these maximum rates. In determining the maximum rental rates due consideration must be given to the income and earning capacity of the prospective occupants of the housing and the cost of operating and maintaining such housing. As a general guide, the rental charges should not exceed 25 percent of the occupant families’ estimated adjusted annual income.

(c) Disapproval of or adverse action on a loan or grant. When a loan and/or grant is disapproved or if adverse action is taken, the reasons for such action will be shown on the original Form FmHA or its successor agency under Public Law 103-354 1944-51. Form FmHA or its successor agency under Public Law 103-354 1944-51 will be initialed and dated. The District Director will notify the applicant in writing of the disapproval of or adverse action on the loan or grant and the reasons therefore and advise them of their right to appeal in accordance with subpart B of part 1900 of this chapter. The disapproved docket will then be handled in accordance with Form FmHA or its successor agency under Public Law 103-354 Instruction 2033-A which is available in any FmHA or its successor agency under Public Law 103-354 office. Any appeals as a result of disapproval or adverse action will be handled in accordance with subpart B of part 1900 of this chapter.