7 USC 2009cc - Definitions

U.S Code last checked for updates: Nov 22, 2024

§ 2009cc.

Definitions

In this subchapter:

(1)

Articles

(2)

Developmental capital

(3)

Employee welfare benefit plan; pension plan

(A)

In general

(B)

Inclusions

The terms “employee welfare benefit plan” and “pension plan” include—

(i)

public and private pension or retirement plans subject to this subchapter; and

(ii)

similar plans not covered by this subchapter that have been established, and that are maintained, by the Federal Government or any State (including by a political subdivision, agency, or instrumentality of the Federal Government or a State) for the benefit of employees.

(4)

Equity capital

The term “equity capital” means—

(A)

common or preferred stock or a similar instrument, including subordinated debt with equity features; and

(B)

any other type of equity-like financing that might be necessary to facilitate the purposes of this Act, excluding financing such as senior debt or other types of financing that competes with routine loanmaking of commercial lenders.

(5)

Leverage

The term “leverage” includes—

(A)

debentures purchased or guaranteed by the Secretary;

(B)

participating securities purchased or guaranteed by the Secretary; and

(C)

preferred securities outstanding as of May 13, 2002.

(6)

License

(7)

Limited liability company

(8)

Member

(9)

Operational assistance

(10)

Participation agreement

(11)

Private capital

(A)

In general

The term “private capital” means the total of—

(i)

(I)

the paid-in capital and paid-in surplus of a corporate rural business investment company;

(II)

the contributed capital of the partners of a partnership rural business investment company; or

(III)

the equity investment of the members of a limited liability company rural business investment company; and

(ii)

unfunded binding commitments from investors that meet criteria established by the Secretary to contribute capital to the rural business investment company, except that—

(I)

unfunded commitments may be counted as private capital for purposes of approval by the Secretary of any request for leverage; but

(II)

leverage shall not be funded based on the commitments.

(B)

Exclusions

The term “private capital” does not include—

(i)

any funds borrowed by a rural business investment company from any source;

(ii)

any funds obtained through the issuance of leverage; or

(iii)

any funds obtained directly or indirectly from the Federal Government or any State (including by a political subdivision, agency, or instrumentality of the Federal Government or a State), except for—

(I)

funds obtained from the business revenues (excluding any governmental appropriation) of any federally chartered or government-sponsored enterprise established prior to May 13, 2002;

(II)

funds invested by an employee welfare benefit plan or pension plan; and

(III)

any qualified nonprivate funds (if the investors of the qualified nonprivate funds do not control, directly or indirectly, the management, board of directors, general partners, or members of the rural business investment company).

(12)

Qualified nonprivate funds

The term “qualified nonprivate funds” means any—

(A)

funds directly or indirectly invested in any applicant or rural business investment company on or before May 13, 2002, by any Federal agency, other than the Department of Agriculture, under a provision of law explicitly mandating the inclusion of those funds in the definition of the term “private capital”; and

(B)

funds invested in any applicant or rural business investment company by 1 or more entities of any State (including by a political subdivision, agency, or instrumentality of the State and including any guarantee extended by those entities) in an aggregate amount that does not exceed 33 percent of the private capital of the applicant or rural business investment company.

(13)

Rural business concern

The term “rural business concern” means—

(A)

a public, private, or cooperative for-profit or nonprofit organization;

(B)

a for-profit or nonprofit business controlled by an Indian tribe on a Federal or State reservation or other federally recognized Indian tribal group; or

(C)

any other person or entity;

that primarily operates in a rural area, as determined by the Secretary.

(14)

Rural business investment company

The term “rural business investment company” means a company that—

(A)

has been granted final approval by the Secretary under section 2009cc–3(e) of this title; and

(B)

has entered into a participation agreement with the Secretary.

(15)

Smaller enterprise

The term “smaller enterprise” means any rural business concern that, together with its affiliates—

(A)

has—

(i)

a net financial worth of not more than $6,000,000, as of the date on which assistance is provided under this subchapter to the rural business concern; and

(ii)

an average net income for the 2-year period preceding the date on which assistance is provided under this subchapter to the rural business concern, of not more than $2,000,000, after Federal income taxes (excluding any carryover losses), except that, for purposes of this clause, if the rural business concern is not required by law to pay Federal income taxes at the enterprise level, but is required to pass income through to the shareholders, partners, beneficiaries, or other equitable owners of the business concern, the net income of the business concern shall be determined by allowing a deduction in an amount equal to the total of—

(I)

if the rural business concern is not required by law to pay State (and local, if any) income taxes at the enterprise level, the net income (determined without regard to this clause), multiplied by the marginal State income tax rate (or by the combined State and local income tax rates, as applicable) that would have applied if the business concern were a corporation; and

(II)

the net income (so determined) less any deduction for State (and local) income taxes calculated under subclause (I), multiplied by the marginal Federal income tax rate that would have applied if the rural business concern were a corporation; or

(B)

satisfies the standard industrial classification size standards established by the Administrator of the Small Business Administration for the industry in which the rural business concern is primarily engaged.

(Pub. L. 87–128, title III, § 384A, as added Pub. L. 107–171, title VI, § 6029, May 13, 2002, 116 Stat. 388; amended Pub. L. 115–334, title VI, § 6426(a), Dec. 20, 2018, 132 Stat. 4770.)

cite as: 7 USC 2009cc