42 U.S.C. § 5184
Community disaster loans
Grants hereunder shall be in an amount not to exceed 50 per centum of allowable project costs. Loans shall be for a term not to exceed 40 years at a per annum interest rate of 5 per centum and shall be on such terms and conditions as the Secretary of Commerce shall determine. In determining the amount of a grant assistance for any project, the Secretary of Commerce may take into consideration such factors as are established by regulation and are consistent with the purposes of this Act.
(a) In general
The President is authorized to make loans to any local government which may suffer a substantial loss of tax and other revenues as a result of a major disaster, and has demonstrated a need for financial assistance in order to perform its governmental functions.
(b) Amount
The amount of any such loan shall be based on need, shall not exceed—
(1)
25 percent of the annual operating budget of that local government for the fiscal year in which the major disaster occurs, and shall not exceed $5,000,000; or
(2)
if the loss of tax and other revenues of the local government as a result of the major disaster is at least 75 percent of the annual operating budget of that local government for the fiscal year in which the major disaster occurs, 50 percent of the annual operating budget of that local government for the fiscal year in which the major disaster occurs, and shall not exceed $5,000,000.
(c) Repayment
(1) Cancellation
Repayment of all or any part of such loan to the extent that revenues of the local government during the three full fiscal year period following the major disaster are insufficient to meet the operating budget of the local government, including additional disaster-related expenses of a municipal operation character shall be cancelled.
(2) Condition on continuing eligibility
A local government shall not be eligible for further assistance under this section during any period in which the local government is in arrears with respect to a required repayment of a loan under this section.
(d) Effect on other assistance
Any loans made under this section shall not reduce or otherwise affect any grants or other assistance under this chapter.
( Pub. L. 93–288, title IV, § 417 , formerly § 414(a), (b), May 22, 1974 , 88 Stat. 158 ; renumbered § 417, Pub. L. 100–707, title I, § 106(j) , Nov. 23, 1988 , 102 Stat. 4705 ; Pub. L. 106–390, title II, § 207 , Oct. 30, 2000 , 114 Stat. 1571 ; Pub. L. 109–347, title VI, § 608 , Oct. 13, 2006 , 120 Stat. 1942 .)