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7 U.S.C. 1926 (a)(2)(B).
69 FR 59772, Oct. 6, 2004, unless otherwise noted.
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(a) Grant proceeds shall be used solely for the purpose of establishing the revolving loan fund to provide loans to eligible entities for:
(1) Pre-development costs associated with proposed water and wastewater projects or with existing water and wastewater systems, and
(2) Short-term costs incurred for replacement equipment, small-scale extension of services, or other small capital projects that are not part of the regular operations and maintenance activities of existing water and wastewater systems.
(b) A grant recipient may not use grant funds in any manner inconsistent with the terms of the grant agreement.