42 U.S.C. § 606 — Federal loans for State welfare programs

(a) Loan authority. (1) The Secretary must make loans to any loan-eligible State with a maturity of no more than three years. (2) “Loan-eligible State” means a State that has not received a penalty under section 609(a)(1). (b) Interest. The Secretary must charge and collect interest at the current average market yield on United States marketable obligations whose remaining maturities are comparable to the loan’s maturity. (c) Use. A State may use the loan only for a purpose for which its section 603(a) grant may be used, including (1) welfare anti-fraud activities and (2) assistance under the State program to Indian families that moved from the service area of a tribe with an approved tribal family assistance plan. (d) During fiscal years 1997 through 2003, all loans to one State together may not exceed 10 percent of that State’s family assistance grant. (e) All outstanding loans under this section together may not exceed $1,700,000,000. (f) Money in the Treasury that has not otherwise been appropriated is appropriated as necessary to cover the cost of loans under this section.