1. (a) A borrower who receives a loan from the rural electrification revolving loan fund may use the loan only to pay for capital improvements that extend the borrower's transmission and distribution system to customers not previously receiving service from a public utility. A borrower may not use the loan to provide electric power generation or fuel storage facilities, or for reconstruction or upgrade of existing transmission and distribution lines.
2. (b) A borrower who receives a loan from the rural electrification revolving loan fund shall use money available to the borrower, other than the proceeds of the loan, to acquire and install one transformer, one span of line, one pole, and one service drop for each customer to who immediate service is provided. The borrower may use proceeds of the loan to pay for additional costs of providing service to a customer receiving immediate service that are not paid by the customer.

(Eff. 2/16/96, Register 137)