42 U.S.C. § 300q — Loan and loan guarantee authority

(a) Covered projects. (1) Until September 30, 1982, the Secretary could make loans from the fund set up under section 300q–2(d) to any public or nonprofit private entity, for projects to: (A) discontinue unneeded hospital services or facilities; (B) convert unneeded hospital services and facilities into needed health services, including outpatient facilities and long-term care facilities; (C) renovate and modernize medical facilities, especially to fix safety hazards, meet licensing or accreditation standards, or replace outdated facilities; (D) build new outpatient medical facilities; or (E) build new inpatient medical facilities in areas that recently grew fast in population. (2)(A) During that same period, the Secretary could also guarantee loans made by private lenders, or by the Federal Financing Bank, to public or nonprofit entities for those same kinds of projects — promising to cover the principal and interest if the borrower defaulted. (B) If a guaranteed loan went to an entity in an urban or rural poverty area, the Secretary could pay the lender enough to cut the loan's normal interest rate by up to half, if the Secretary found the project couldn't happen without that help. (b) Amount of loans for medical facilities projects and such projects in urban or rural poverty areas. A direct or guaranteed loan, added to any other help the project gets under part B, normally can't cover more than 90 percent of the project's cost. In an urban or rural poverty area, that combined help can cover up to 100 percent of the cost. (c) Limitation on cumulative total of principal of outstanding loans. The total unpaid principal across all guaranteed and direct loans at any one time can't exceed whatever limit Congress sets in its appropriations laws. (d) Administrative assistance of Department of Housing and Urban Development. With HUD's consent, the Secretary must get HUD's help running this part of the program, to keep it efficient and economical.