--- kind: "section" citation: "42 U.S.C. § 291j–3" title: "42" title_heading: "The Public Health and Welfare" number: "291j–3" heading: "Applications and conditions" release: "119-102" date: "2026-07-12" url: "https://uscodex.org/usc/42/291j-3" units: - "Chapter 6A — Public Health Service" - "Subchapter IV — Construction and Modernization of Hospitals and Other Medical Facilities" - "Part B — Loan Guarantees and Loans for Modernization and Construction of Hospitals and Other Medical Facilities" --- # §291j–3. Applications and conditions - (a) **Contents of applications—** For each [project](/usc/42/13641.md?p=2) for which a guarantee of a loan to a [nonprofit](/usc/42/300s–3.md?p=3) private [agency](/usc/42/8262.md?p=1) or a direct loan to a [public agency](/usc/42/11851.md?p=8) is sought under this part, there shall be submitted to the [Secretary](/usc/42/201.md?p=c), through the [State agency](/usc/42/300s–3.md?p=12) designated in accordance with [section 291d of this title](/usc/42/291d.md), an application by such private [nonprofit](/usc/42/300s–3.md?p=3) [agency](/usc/42/8262.md?p=1) or by such [public agency](/usc/42/11851.md?p=8). If two or more private [nonprofit](/usc/42/300s–3.md?p=3) [agencies](/usc/42/8262.md?p=1), or two or more [public agencies](/usc/42/11851.md?p=8), join in the [project](/usc/42/13641.md?p=2), the application may be filed by one or more such [agencies](/usc/42/8262.md?p=1). Such application shall (1) set forth all of the descriptions, plans, specifications, assurances, and information which are required by the third sentence of [section 291e(a) of this title](/usc/42/291e.md?p=a) (other than clause (6) thereof) with respect to applications submitted under that section, (2) contain such other information as the [Secretary](/usc/42/201.md?p=c) may require to carry out the purposes of this part, and (3) include a certification by the [State agency](/usc/42/300s–3.md?p=12) of the total cost of the [project](/usc/42/13641.md?p=2) and the amount of the loan for which a guarantee is sought under this part, or the amount of the direct loan sought under this part, as the case may be. - (b) **Conditions for approval—** The [Secretary](/usc/42/201.md?p=c) may approve such application only if— - (1) there remains sufficient balance in the allotment determined for such [State](/usc/42/201.md?p=f) pursuant to [section 291j–2 of this title](/usc/42/291j–2.md) to cover the amount of the loan for which a guarantee is sought, or the amount of the direct loan sought (as the case may be), in such application, - (2) he makes each of the findings which are required by clauses (1) through (4) of [section 291e(b) of this title](/usc/42/291e.md?p=b) for the approval of applications for [projects](/usc/42/13641.md?p=2) thereunder (except that, in the case of the finding required under such clause (4) of entitlement of a [project](/usc/42/13641.md?p=2) to a priority established under [section 291c(a) of this title](/usc/42/291c.md?p=a); such finding shall be made without regard to the provisions of clauses [(1)](/usc/42/291c.md?p=a-1) and [(3)](/usc/42/291c.md?p=a-3) of such section), - (3) he finds that there is compliance with [section 291e(e) of this title](/usc/42/291e.md?p=e), - (4) he obtains assurances that the applicant will keep such records, and afford such access thereto, and make such reports, in such form and containing such information, as the [Secretary](/usc/42/201.md?p=c) may reasonably require, and - (5) he also determines, in the case of a loan for which a guarantee is sought, that the terms, conditions, maturity, security (if any), and schedule and amounts of repayments with respect to the loan are sufficient to protect the financial interests of the United States and are otherwise reasonable and in accord with [regulations](/usc/42/201.md?p=d), including a determination that the rate of interest does not exceed such per centum per annum on the principal obligation outstanding as the [Secretary](/usc/42/201.md?p=c) determines to be reasonable, taking into account the range of interest rates prevailing in the private market for similar loans and the risks assumed by the United States. - (c) **Hearing—** No application under this section shall be disapproved until the [Secretary](/usc/42/201.md?p=c) has afforded the [State agency](/usc/42/300s–3.md?p=12) an opportunity for a hearing. - (d) **Amendment of approved applications—** Amendment of an approved application shall be subject to approval in the same manner as an original application. - (e) **Recovery rights; terms and conditions—** - (1) In the case of any loan to a [nonprofit](/usc/42/300s–3.md?p=3) private [agency](/usc/42/8262.md?p=1), the United States shall be entitled to recover from the applicant the amount of any payments made pursuant to any guarantee of such loan under this part, unless the [Secretary](/usc/42/201.md?p=c) for good cause waives its right of recovery, and, upon making any such payment, the United States shall be subrogated to all of the rights of the recipient of the payments with respect to which the guarantee was made. - (2) Guarantees of loans to [nonprofit](/usc/42/300s–3.md?p=3) private [agencies](/usc/42/8262.md?p=1) under this part shall be subject to such further terms and conditions as the [Secretary](/usc/42/201.md?p=c) determines to be necessary to assure that the purposes of this part will be achieved, and, to the extent permitted by [subsection (f)](#f), any of such terms and conditions may be modified by the [Secretary](/usc/42/201.md?p=c) to the extent he determines it to be consistent with the financial interest of the United States. - (f) **Incontestable guarantee—** Any guarantee of a loan to a [nonprofit](/usc/42/300s–3.md?p=3) private [agency](/usc/42/8262.md?p=1) made by the [Secretary](/usc/42/201.md?p=c) pursuant to this part shall be incontestable in the hands of an applicant on whose behalf such guarantee is made, and as to any person who makes or contracts to make a loan to such applicant in reliance thereon, except for fraud or misrepresentation on the part of such applicant or such other person. ## Source credit (July 1, 1944, ch. 373, title VI, § 623, as added Pub. L. 91–296, title II, § 201, June 30, 1970, 84 Stat. 346.)