The Church Arson Prevention Act of 1996 (the Act) authorizes certain Federal departments to implement procedures to address the destructive consequences of acts of arson and terrorism carried out against places of worship. Section 4 of the Act directs HUD to publish regulations governing the provision of loan guarantees to financial institutions that make loans to certain nonprofit organizations adversely affected by such acts. This final rule implements section 4 of the Act. Specifically, this rule establishes the procedures, terms, and conditions by which HUD will guarantee loans to assist nonprofit organizations in financing activities designed to rebuild and rehabilitate structures, to replace and restore personal property, and to finance other eligible activities as provided for in this final rule. In addition, HUD anticipates forming a cooperative venture and participating with other entities in the pooling of funds so as to better achieve the objectives of the Act and this final rule.