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COMPTROLLER GENERAL OF TIlE UNITED STATES
I1 WASHINGTON D.C. 205411
B.-2096B0 FE 2 4. 1983
The Honorable John D. Dingell ..to...
House of Representativet ....
Dear Mr. Dingellr
Your letter of Qctober 22, 1982, requested that ve inve.s-
tigate the availability of ,the Economic Development Revolving
Fund (the Fund) for the purpose 9f making direct loans to
qualified businesses during the current fisc4l year, In our
view, the Fund is available for, this purpose in its entirety
during this fiscal. year, although the Economic Development Ad-
ministration (EDA) is not required to make any direct loans.
To resolve this question 1inNovember we requested
EDA's formal written comments on the Fund's availability, and
2) In December we nie, informally ,with ODA and Commerce Depart-
ment representatives, At our iecebermeeting EDA present:ed
some preliminary an lysis on why the Fuid Might: not be avhil-
able. Basically, it argued then that the lack of a current
appropriation spec'L'tially earmarked for.d(Iirect loans, coupled
with the history of restrictions which have been placed' on the
Fund in annual approprigtion acts, have pu't the-Fund off
limits. The Commerce Department's Formal',',response , dated
February 4, 1983 (enclosed for your inormation), does not
dispute our legal finding that the Fund is available.. How-
ever, it cites the current appropriation, an ~rnalysis of
congressional intent and the previous restrictions'on the Fund
as reasons why it should not use the Fund for direct loans
this year or in the future.
The Fund was created by the Public Works and Economilc
Development Act of 1965 (PWEDA) to underwrite Federal finan-
cial assistance to businesses and to public works and rede- /
velopment projects. Section 203 of PWEDA, provides that:
Funds obtained by the Secretary under
section 201 [authorizatibon for appropriations
to ca'rry out public works and business loan
programs], loan funds obtained.under section
403 (authorization of appropriations for rede-
velopment projects], and collections and repay-*
ments received under this Act, shall be
deposited in an economic development revolving
fund, * * * which is hereby established in the
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