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Repayment of principal may be re -used only for eligible uses and is subject to restrictions <br />on the timing of the use of funds. Interest payments received prior to the end of the period of <br />performance will be considered an addition to the total award and may be used for any purpose <br />that is an eligible use of funds under the statute and final rule. Recipients are not subject to <br />restrictions under 2 CFR 200.307(e)(1) with respect to such payments. <br />For loans with maturities longer than December 31, 2026, the recipient must estimate the <br />cost to the recipient of extending the loan over the life of the loan. In other words, at origination, <br />the recipient must measure the projected cost of the loan and may use SLFRF funds for the <br />projected cost of the loan. Recipients have two options for estimating this amount: they may <br />estimate the subsidy cost (i.e., net present value of estimated cash flows) or the discounted cash <br />flow under current expected credit losses (i.e., CECL method). See further guidance issued by <br />Treasury for further explanation.381 <br />Public Comment: Many commenters asked for further clarification on the treatment of <br />loans and the calculation of "costs incurred." Some commenters requested that grants made for <br />eligible activities prior to December 31, 2024 to a revolving loan fund, an economic <br />development corporation, a land bank, or a similar facility should be considered obligated and <br />expended at the time of the grant. This would allow funds to be expended by the grantee beyond <br />the covered period and for funds returned to the grantee to be re -invested in further uses outside <br />of the covered period. <br />Treasury Response: The final rule maintains the treatment of loans from the interim final <br />rule and subsequent guidance, as discussed above. This approach is consistent with the statutory <br />381 See FAQ 4.11. Coronavirus State and Local Fiscal Recovery Funds, Frequently Asked Questions, as of July 19, <br />2021; https://home.treasury.gov/system/files/1 3 6/SLFRPFAQ.pdf. <br />367 <br />