§ 1948.124 - FmHA or its successor agency under Public Law 103-354 evaluation of application.

(a) FmHA or its successor agency under Public Law 103-354 will input the necessary data via terminal screens into the Rural Community Facility Tracking System (RCFTS). If FmHA or its successor agency under Public Law 103-354 so desires, a Form FmHA 2033-34, “Management System Card—Business and Industry,” may be prepared in accordance with FmHA Instruction 2033-F.

(b) Applications will be organized in a loan file in accordance with FmHA Instruction 2033-A. The intermediary's Internal Revenue Service (IRS) tax number preceded by State and County code numbers will constitute the case number to be used on all FmHA or its successor agency under Public Law 103-354 forms.

(c) The FmHA or its successor agency under Public Law 103-354 Administrator or designee will complete Form FmHA 1948-2, IRP Project Summary, evaluate the application and make a determination whether: the intermediary is eligible; the proposed loan is for an eligible purpose; there is reasonable assurance of repayment ability, sufficient collateral, and sufficient equity; there is a need for an environmental impact statement or environmental mitigation; there are any unresolved intergovernmental consultation issues; and the proposed loan complies with all applicable statutes and regulations. If FmHA or its successor agency under Public Law 103-354 determines it is unable to provide the loan, the intermediary will be informed in writing. Such notification will include the reasons for denial of the loan. If FmHA or its successor agency under Public Law 103-354 is able to provide the loan, it will provide the intermediary a letter of conditions listing all requirements for such loan.

(1) Requirements listed in letters of conditions will ordinarily include: maximum amount of loan which may be considered, terms of loan, description of the use of loan funds, verification requirements, disbursement of funds, security requirements, and audit reports required.

(2) The letter of conditions will contain the following paragraphs:

(3) The Administrator or designee is the only person authorized to execute the letter of conditions.

(d) Immediately after reviewing the conditions and requirements in the letter of conditions, the intermediary should complete, sign and return the Form FmHA 422-46 to the FmHA or its successor agency under Public Law 103-354 Administrator. If certain conditions cannot be met, the borrower may propose alternate conditions to FmHA or its successor agency under Public Law 103-354. The Administrator or designee must concur with any changes made to the initially issued or proposed letter of conditions.

(e) If at any time prior to loan approval it is decided that favorable action will not be taken on an application, FmHA or its successor agency under Public Law 103-354 will notify the applicant in writing of the reasons why the request was not favorably considered. The notification to the applicant will state that a review of this decision by FmHA or its successor agency under Public Law 103-354 may be requested by the applicant in accordance with subpart B of part 1900 of this chapter.