---
kind: "section"
citation: "42 U.S.C. § 291e"
title: "42"
title_heading: "The Public Health and Welfare"
number: "291e"
heading: "Projects for construction or modernization"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/42/291e"
units:
  - "Chapter 6A — Public Health Service"
  - "Subchapter IV — Construction and Modernization of Hospitals and Other Medical Facilities"
  - "Part A — Grants and Loans for Construction and Modernization of Hospitals and Other Medical Facilities"
---

# §291e. Projects for construction or modernization

- (a) **Application; contents—** For each [project](/usc/42/13641.md?p=2) pursuant to a [State plan](/usc/42/300d–31.md?p=2) approved under this part, there shall be submitted to the [Surgeon General](/usc/42/201.md?p=b), through the [State agency](/usc/42/300s–3.md?p=12), an application by the [State](/usc/42/201.md?p=f) or a political subdivision thereof or by a public or other [nonprofit](/usc/42/300s–3.md?p=3) [agency](/usc/42/8262.md?p=1). If two or more such [agencies](/usc/42/8262.md?p=1) join in the [project](/usc/42/13641.md?p=2), the application may be filed by one or more of such [agencies](/usc/42/8262.md?p=1). Such application shall set forth—
  - (1) a description of the site for such [project](/usc/42/13641.md?p=2);
  - (2) plans and specifications therefor, in accordance with [regulations](/usc/42/201.md?p=d) prescribed under [section 291c of this title](/usc/42/291c.md);
  - (3) reasonable assurance that title to such site is or will be vested in one or more of the [agencies](/usc/42/8262.md?p=1) filing the application or in a public or other [nonprofit](/usc/42/300s–3.md?p=3) [agency](/usc/42/8262.md?p=1) which is to operate the facility on completion of the [project](/usc/42/13641.md?p=2);
  - (4) reasonable assurance that adequate financial support will be available for the completion of the [project](/usc/42/13641.md?p=2) and for its maintenance and operation when completed;
  - (5) reasonable assurance that all laborers and mechanics employed by contractors or subcontractors in the performance of [construction](/usc/42/300s–3.md?p=7) or [modernization](/usc/42/300s–3.md?p=9) on the [project](/usc/42/13641.md?p=2) will be paid wages at rates not less than those prevailing on similar work in the locality as determined by the [Secretary](/usc/42/201.md?p=c) of Labor in accordance with sections 3141–3144, [3146](/usc/40/3146.md), and [3147](/usc/40/3147.md) of title 40; and the [Secretary](/usc/42/201.md?p=c) of Labor shall have with respect to the labor standards specified in this paragraph the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (15 F.R. 3176) and [section 3145 of title 40](/usc/40/3145.md); and
  - (6) a certification by the [State agency](/usc/42/300s–3.md?p=12) of the Federal share for the [project](/usc/42/13641.md?p=2).
- (b) **Approval by Surgeon General; requisites; additional approval by Secretary of Health and Human Services—** The [Surgeon General](/usc/42/201.md?p=b) shall approve such application if sufficient funds to pay the Federal share of the cost of such [project](/usc/42/13641.md?p=2) are available from the appropriate allotment to the [State](/usc/42/201.md?p=f), and if the [Surgeon General](/usc/42/201.md?p=b) finds (1) that the application contains such reasonable assurance as to title, financial support, and payment of prevailing rates of wages; (2) that the plans and specifications are in accord with the [regulations](/usc/42/201.md?p=d) prescribed pursuant to [section 291c of this title](/usc/42/291c.md); (3) that the application is in conformity with the [State plan](/usc/42/300d–31.md?p=2) approved under [section 291d of this title](/usc/42/291d.md) and contains an assurance that in the operation of the [project](/usc/42/13641.md?p=2) there will be compliance with the applicable requirements of the [regulations](/usc/42/201.md?p=d) prescribed under [section 291c(e) of this title](/usc/42/291c.md?p=e), and with [State](/usc/42/201.md?p=f) standards for operation and maintenance; and (4) that the application has been approved and recommended by the [State agency](/usc/42/300s–3.md?p=12), opportunity has been provided, prior to such approval and recommendation, for consideration of the [project](/usc/42/13641.md?p=2) by the public or [nonprofit](/usc/42/300s–3.md?p=3) private [agency](/usc/42/8262.md?p=1) or organization which has developed the comprehensive regional, metropolitan area, or other local area plan or plans referred to in [section 246(b) of this title](/usc/42/246.md?p=b) covering the area in which such [project](/usc/42/13641.md?p=2) is to be located or, if there is no such [agency](/usc/42/8262.md?p=1) or organization, by the [State agency](/usc/42/300s–3.md?p=12) administering or supervising the administration of the [State plan](/usc/42/300d–31.md?p=2) approved under [section 246(a) of this title](/usc/42/246.md?p=a), and the application is for a [project](/usc/42/13641.md?p=2) which is entitled to priority over other [projects](/usc/42/13641.md?p=2) within the [State](/usc/42/201.md?p=f) in accordance with the [regulations](/usc/42/201.md?p=d) prescribed pursuant to [section 291c(a) of this title](/usc/42/291c.md?p=a). Notwithstanding the preceding sentence, the [Surgeon General](/usc/42/201.md?p=b) may approve such an application for a [project](/usc/42/13641.md?p=2) for [construction](/usc/42/300s–3.md?p=7) or [modernization](/usc/42/300s–3.md?p=9) of a [rehabilitation facility](/usc/42/300s–3.md?p=5) only if it is also approved by the [Secretary](/usc/42/201.md?p=c) of Health and Human [Services](/usc/42/201.md?p=a).
- (c) **Opportunity for hearing required prior to disapproval—** No application shall be disapproved until the [Surgeon General](/usc/42/201.md?p=b) has afforded the [State agency](/usc/42/300s–3.md?p=12) an opportunity for a hearing.
- (d) **Amendments subject to same approval as original applications—** Amendment of any approved application shall be subject to approval in the same manner as an original application.
- (e) **Outpatient facilities; requirements of applicants—** Notwithstanding any other provision of this subchapter, no application for an outpatient facility shall be approved under this section unless the applicant is (1) a [State](/usc/42/201.md?p=f), political subdivision, or [public agency](/usc/42/11851.md?p=8), or (2) a [corporation](/usc/42/2297h.md?p=2) or association which owns and operates a [nonprofit](/usc/42/300s–3.md?p=3) [hospital](/usc/42/300s–3.md?p=1) (as defined in [section 291o](/usc/42/291o.md) of this title) or which provides reasonable assurance that the [services](/usc/42/201.md?p=a) of a general [hospital](/usc/42/300s–3.md?p=1) will be available to patients of such facility who are in need of [hospital](/usc/42/300s–3.md?p=1) care.

## Source credit

(July 1, 1944, ch. 373, title VI, § 605, as added Pub. L. 88–443, § 3(a), Aug. 18, 1964, 78 Stat. 453; amended Pub. L. 91–296, title I, §§ 111(a), 116(e), June 30, 1970, 84 Stat. 340, 342; Pub. L. 96–88, title V, § 509(b), Oct. 17, 1979, 93 Stat. 695.)

## Notes

### Editorial Notes

### References in Text

Reorganization Plan Numbered 14 of 1950, referred to in subsec. (a)(5), is set out in the Appendix to Title 5, Government Organization and Employees.

### Codification

In subsec. (a) (5), “sections 3141–3144, 3146, and 3147 of title 40” substituted for “the Davis-Bacon Act, as amended (40 U.S.C. 276a—276a–5)” and “section 3145 of title 40” substituted for “section 2 of the Act of June 13, 1934, as amended (40 U.S.C. 276c)” on authority of Pub. L. 107–217, § 5(c), Aug. 21, 2002, 116 Stat. 1303, the first section of which enacted Title 40, Public Buildings, Property, and Works.

### Prior Provisions

A prior section 291e, act July 1944, ch. 373, title VI, § 622, as added Aug. 13, 1946, ch. 958, § 2, 60 Stat. 1041; amended 1953 Reorg. Plan No. 1, §§ 5, 8, eff. Apr. 11, 1953, 18 F.R. 2053, 67 Stat. 631, authorized Surgeon General to prescribe general regulations, prior to the general amendment of this subchapter by Pub. L. 88–443. See section 291c of this title.

A prior section 291h(a), (c), act July 1, 1944, ch. 373, title VI, § 625, as added Aug. 13, 1946, ch. 958, § 2, 60 Stat. 1041; amended Oct. 25, 1949, ch. 722, § 8, 63 Stat. 901, related to subject matter similar to this section, prior to the general amendment of this subchapter by Pub. L. 88–443.

A prior section 291v(d), act July 1, 1944, ch. 373, title VI, § 654, as added July 12, 1954, ch. 471, § 3, 68 Stat. 463, related to subject matter similar to this section, prior to the general amendment of this subchapter by Pub. L. 88–443.

### Amendments

1970—Subsec. (b)(4). Pub. L. 91–296, § 111(a), inserted provisions requiring that the appropriate area wide health planning agency be given an opportunity to consider the project for which an application is made before approval is given.

Subsec. (e). Pub. L. 91–296, § 116(e), substituted “an outpatient facility” for “a diagnostic or treatment center” and inserted provisions extending coverage to include corporations and associations which, although not owning or operating hospitals offer services of a general hospital to patients in need of hospital care.

### Statutory Notes and Related Subsidiaries

### Change of Name

“Secretary of Health and Human Services” substituted for “Secretary of Health, Education, and Welfare” in subsec. (b) pursuant to section 509(b) of Pub. L. 96–88, which is classified to section 3508(b) of Title 20, Education.

### Effective Date of 1970 Amendment

Pub. L. 91–296, title I, § 111(a), June 30, 1970, 84 Stat. 340, provided that the amendment made by that section is effective with respect to applications approved under this subchapter after June 30, 1970.

Pub. L. 91–296, title I, § 116(e), June 30, 1970, 84 Stat. 342, applicable with respect to applications approved under this subchapter after June 30, 1970, see section 116(g) of Pub. L. 91–296, set out as a note under section 291o of this title.

### Applications Approved Prior to Aug. 18, 1964

Pub. L. 88–443, § 3(b)(1), Aug. 18, 1964, 78 Stat. 462, providing that applications approved, and allotments appropriated prior to Aug. 18, 1964, shall be governed by this subchapter as in effect prior to such date, is set out as an Effective Date note under section 291 of this title.

### Funds for Modernization Projects; Conditions To Be Met Before Approval

Pub. L. 88–443, § 3(b)(5), Aug. 18, 1964, 78 Stat. 462, provided that no application with respect to a modernization project may be approved for purposes of receiving funds from an allotment under section 291(a)(2) of this title before July 1, 1965, or before a State plan has been approved, as well as certain other requirements. See Effective Date note set out under section 291 of this title.

### Executive Documents

### Transfer of Functions

Office of Surgeon General abolished by section 3 of Reorg. Plan No. 3 of 1966, eff. June 25, 1966, 31 F.R. 8855, 80 Stat. 1610, and functions thereof transferred to Secretary of Health, Education, and Welfare by section 1 of Reorg. Plan No. 3 of 1966, set out as a note under section 202 of this title. Office of Surgeon General reestablished within the Office of the Assistant Secretary for Health, see Notice of Department of Health and Human Services, Office of the Assistant Secretary for Health, Mar. 30, 1987, 52 F.R. 11754.