U.S. Code > Title 42 The Public Health and Welfare > CHAPTER 6A—PUBLIC HEALTH SERVICE > SUBCHAPTER II—GENERAL POWERS AND DUTIES > Part D—Primary Health Care > subpart iii—scholarship program and loan repayment program > § 254p. Special loans for former Corps members to enter private practice

§ 254p. Special loans for former Corps members to enter private practice

(a) Persons entitled; conditions
The Secretary may, out of appropriations authorized under section 254k of this title, make one loan to a Corps member who has agreed in writing—
(1) to engage in the private full-time clinical practice of the profession of the member in a health professional shortage area (designated under section 254e of this title) for a period of not less than 2 years which—
(A) in the case of a Corps member who is required to complete a period of obligated service under this subpart, begins not later than 1 year after the date on which such individual completes such period of obligated service; and
(B) in the case of an individual who is not required to complete a period of obligated service under this subpart, begins at such time as the Secretary considers appropriate;
(2) to conduct such practice in accordance with section 254n (b)(1) of this title; and
(3) to such additional conditions as the Secretary may require to carry out this section.
Such a loan shall be used to assist such individual in meeting the costs of beginning the practice of such individual’s profession in accordance with such agreement, including the costs of acquiring equipment and renovating facilities for use in providing health services, and of hiring nurses and other personnel to assist in providing health services. Such loan may not be used for the purchase or construction of any building.
(b) Amount of loan; maximum interest rate
(1) The amount of a loan under subsection (a) of this section to an individual shall not exceed $25,000.
(2) The interest rate for any such loan shall not exceed an annual rate of 5 percent.
(c) Application for loan; submission and approval; interest rates and repayment terms
The Secretary may not make a loan under this section unless an application therefor has been submitted to, and approved by, the Secretary. The Secretary shall, by regulation, set interest rates and repayment terms for loans under this section.
(d) Breach of agreement; notice; determination of liability
If the Secretary determines that an individual has breached a written agreement entered into under subsection (a) of this section, he shall, as soon as practicable after making such determination, notify the individual of such determination. If within 60 days after the date of giving such notice, such individual is not practicing his profession in accordance with the agreement under such subsection and has not provided assurances satisfactory to the Secretary that he will not knowingly violate such agreement again, the United States shall be entitled to recover from such individual—
(1) in the case of an individual who has received a grant under this section (as in effect prior to October 1, 1984), an amount determined under section 254o (b) of this title, except that in applying the formula contained in such section “f” shall be the sum of the amount of the grant made under subsection (a) of this section to such individual and the interest on such amount which would be payable if at the time it was paid it was a loan bearing interest at the maximum legal prevailing rate, “t” shall be the number of months that such individual agreed to practice his profession under such agreement, and “s” shall be the number of months that such individual practices his profession in accordance with such agreement; and
(2) in the case of an individual who has received a loan under this section, the full amount of the principal and interest owed by such individual under this section.