EMERGENCY LOAN GUARANTEE.

SEC. 431. EMERGENCY LOAN GUARANTEE. (a) In General.— (1) Provision for guarantee.— Subject to the terms and conditions established by or under this subsection, the Secretary of the Treasury shall guarantee the repayment of any amount not to exceed $180,000,000 borrowed by the State of Rhode Island and Providence Plantations (hereafter in this section referred to as the “State of Rhode Island”), or the Depositors Economic Protection Corporation established by such State, to expedite the repayment of depositors at State-chartered banks and credit unions in receivership in such State and to facilitate the resolution of such receiverships. (2) Loan collateral required as condition for guarantee.— The Secretary of the Treasury may not guarantee the repayment of any amount under paragraph (1) unless the amount of any loan for which the guarantee is sought is fully secured as follows: (A) A first lien on assets held or controlled by the Depositors Economic Protection Corporation and the proceeds from the sale of such assets, are irrevocably pledged to the extent necessary to provide collateral for the guarantee. (B) If the liens and assets described in subparagraph (A) are insufficient to fully secure the guarantee, then a first lien on any assets held or controlled by the State of Rhode Island or any instrumentality of the State of Rhode Island and the proceeds from the sale of such assets, are irrevocably pledged to the extent necessary to provide collateral for the guarantee. (C) If the liens and assets described in subparagraphs (A) and (B) are insufficient to fully secure the guarantee, then any revenue from the State sales tax which is dedicated to the Depositors Economic Protection Corporation under the law of the State of Rhode Island in excess of the amount necessary to pay principal and interest on any obligation of the State or the Corporation issued before the date of the loan is irrevocably dedicated to the extent necessary to provide collateral for the guarantee. (3) Guarantee fees.— The Secretary may assess and collect with respect to loans guaranteed under this subsection an annual guarantee fee computed daily at a rate which may not exceed one-half of 1 percent of the outstanding principal amount of the guaranteed loan. (4) Pledge of certain income for repayment.— The Secretary may not guarantee under this section the repayment of any loan proposed to be made to the Depositors Economic Protection Corporation unless, for each fiscal year of the Depositors Economic Protection Corporation, all rents, issues, profits, products, proceeds, revenues, and other income (including insurance proceeds and condemnation awards) received by the Corporation from, or attributable to, the assets pledged to the United States in accordance with this subsection, in excess of the amount necessary to pay the interest, or principal and 105 STAT. 2380interest on any loan to the Corporation guaranteed under paragraph (1) that is payable in such fiscal year are irrevocably pledged to be deposited into a sinking fund or defeasance fund maintained by the Corporation and are irrevocably pledged and dedicated to the repayment of the principal of such guaranteed loan in the inverse order of the maturity of such principal installments. (5) Investment grade rating.— The Secretary may not guarantee under this section the repayment of any loan proposed to be made to the State of Rhode Island or the Depositors Economic Protection Corporation unless each such proposed loan has received a rating (for purposes of which the collateral securing the guarantee is considered to be securing the loan) of— (A) the highest investment grade from a nationally recognized statistical rating organization; (B) not less than 1 less than the investment grade rating from 2 nationally recognized statistical rating organizations; or (C) not less than 2 less than the highest investment grade from 2 nationally recognized statistical rating organizations to the extent that— (i) a rating of not less than 1 less than the highest investment grade rating from 2 nationally recognized statistical rating organization has not been achieved through the use of all of the collateral listed in subsection (a)(2)(A) and the available collateral under subparagraph (B) or (C) of subsection (a)(2) at the time of the State of Rhode Island’s request for the loan guarantee; and (ii) representatives of the State of Rhode Island and the Secretary are able to agree upon the lesser grade rating based on changes negotiated to other terms of this subtitle, including the purchase of bond insurance. (6) Terms.— (A) In general.— The guarantee provided for in this subsection shall be with respect to a loan which— (i) is made not more than 1 year after the date of enactment of this Act; (ii) will mature not later than 8 years after the date of such loan; and (iii) is scheduled to be repaid in equal installments of principal during the last 4 years of the repayment term of such loan. (B) Authority to vary time periods.— The Secretary and the duly authorized representative of the State of Rhode Island may, by mutual agreement, modify any durational requirement specified in subparagraph (A). (7) Additional terms and conditions.— Except as otherwise provided in this subsection, the terms and conditions of any loan guarantee under this section shall be established by mutual agreement of the Secretary of the Treasury and the duly authorized representative of the State of Rhode Island. (b) Appropriation of Amounts.— There are hereby appropriated to the Secretary of the Treasury such sums as may be necessary for any fiscal year to meet the obligation of the United States under subsection (a)(1).