U.S. Congress - Text of H.R.1427 as Referred in Senate Federal Housing Finance Reform Act of 2007
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Donate NowH.R.1427 - Federal Housing Finance Reform Act of 2007
To reform the regulation of certain housing-related Government-sponsored enterprises, and for other purposes.
| Version | Word Count | Changes From Previous Version | Percent Change |
|---|---|---|---|
| Introduced in House | 58,261 | n/a | n/a |
| Reported in House | 62,017 | 347 | 12% |
| Engrossed in House | 63,605 | 57 | 4% |
| Referred in Senate | 63,308 | 5 Show Changes Hide Changes | 0% |
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HR 1427 EHRFSCommentsClose CommentsPermalink
May 24, 2007
Received; read twice and referred to the Committee on Banking, Housing, and Urban AffairsCommentsClose CommentsPermalink
To reform the regulation of certain housing-related Government-sponsored enterprises, and for other purposes.CommentsClose CommentsPermalink
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, CommentsClose CommentsPermalink
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) Short Title- This Act may be cited as the `Federal Housing Finance Reform Act of 2007'.CommentsClose CommentsPermalink
(b) Table of Contents- The table of contents for this Act is as follows:CommentsClose CommentsPermalink
Sec. 1. Short title and table of contents.CommentsClose CommentsPermalink
Sec. 2. Definitions.CommentsClose CommentsPermalink
TITLE I--REFORM OF REGULATION OF ENTERPRISES AND FEDERAL HOME LOAN BANKS
Subtitle A--Improvement of Safety and Soundness
Sec. 101. Establishment of the Federal Housing Finance Agency.CommentsClose CommentsPermalink
Sec. 102. Duties and authorities of Director.CommentsClose CommentsPermalink
Sec. 103. Federal Housing Enterprise Board.CommentsClose CommentsPermalink
Sec. 104. Authority to require reports by regulated entities.CommentsClose CommentsPermalink
Sec. 105. Disclosure of income and charitable contributions by enterprises.CommentsClose CommentsPermalink
Sec. 106. Assessments.CommentsClose CommentsPermalink
Sec. 107. Examiners and accountants.CommentsClose CommentsPermalink
Sec. 108. Prohibition and withholding of executive compensation.CommentsClose CommentsPermalink
Sec. 109. Reviews of regulated entities.CommentsClose CommentsPermalink
Sec. 110. Inclusion of minorities and women; diversity in Agency workforce.CommentsClose CommentsPermalink
Sec. 111. Regulations and orders.CommentsClose CommentsPermalink
Sec. 112. Non-waiver of privileges.CommentsClose CommentsPermalink
Sec. 113. Risk-Based capital requirements.CommentsClose CommentsPermalink
Sec. 114. Minimum and critical capital levels.CommentsClose CommentsPermalink
Sec. 115. Review of and authority over enterprise assets and liabilities.CommentsClose CommentsPermalink
Sec. 116. Corporate governance of enterprises.CommentsClose CommentsPermalink
Sec. 117. Required registration under Securities Exchange Act of 1934.CommentsClose CommentsPermalink
Sec. 118. Liaison with Financial Institutions Examination Council.CommentsClose CommentsPermalink
Sec. 119. Guarantee fee study.CommentsClose CommentsPermalink
Sec. 120. Conforming amendments.CommentsClose CommentsPermalink
Subtitle B--Improvement of Mission Supervision
Sec. 131. Transfer of product approval and housing goal oversight.CommentsClose CommentsPermalink
Sec. 132. Review of enterprise products.CommentsClose CommentsPermalink
Sec. 133. Conforming loan limits.CommentsClose CommentsPermalink
Sec. 134. Annual housing report regarding regulated entities.CommentsClose CommentsPermalink
Sec. 135. Annual reports by regulated entities on affordable housing stock.CommentsClose CommentsPermalink
Sec. 136. Mortgagor identification requirements for mortgages of regulated entities.CommentsClose CommentsPermalink
Sec. 137. Revision of housing goals.CommentsClose CommentsPermalink
Sec. 138. Duty to serve underserved markets.CommentsClose CommentsPermalink
Sec. 139. Monitoring and enforcing compliance with housing goals.CommentsClose CommentsPermalink
Sec. 140. Affordable Housing Fund.CommentsClose CommentsPermalink
Sec. 141. Consistency with mission.CommentsClose CommentsPermalink
Sec. 142. Enforcement.CommentsClose CommentsPermalink
Sec. 143. Conforming amendments.CommentsClose CommentsPermalink
Subtitle C--Prompt Corrective Action
Sec. 151. Capital classifications.CommentsClose CommentsPermalink
Sec. 152. Supervisory actions applicable to undercapitalized regulated entities.CommentsClose CommentsPermalink
Sec. 153. Supervisory actions applicable to significantly undercapitalized regulated entities.CommentsClose CommentsPermalink
Sec. 154. Authority over critically undercapitalized regulated entities.CommentsClose CommentsPermalink
Sec. 155. Conforming amendments.CommentsClose CommentsPermalink
Subtitle D--Enforcement Actions
Sec. 161. Cease-and-desist proceedings.CommentsClose CommentsPermalink
Sec. 162. Temporary cease-and-desist proceedings.CommentsClose CommentsPermalink
Sec. 163. Prejudgment attachment.CommentsClose CommentsPermalink
Sec. 164. Enforcement and jurisdiction.CommentsClose CommentsPermalink
Sec. 165. Civil money penalties.CommentsClose CommentsPermalink
Sec. 166. Removal and prohibition authority.CommentsClose CommentsPermalink
Sec. 167. Criminal penalty.CommentsClose CommentsPermalink
Sec. 168. Subpoena authority.CommentsClose CommentsPermalink
Sec. 169. Conforming amendments.CommentsClose CommentsPermalink
Subtitle E--General Provisions
Sec. 181. Boards of enterprises.CommentsClose CommentsPermalink
Sec. 182. Report on portfolio operations, safety and soundness, and mission of enterprises.CommentsClose CommentsPermalink
Sec. 183. Conforming and technical amendments.CommentsClose CommentsPermalink
Sec. 184. Study of alternative secondary market systems.CommentsClose CommentsPermalink
Sec. 185. Effective date.CommentsClose CommentsPermalink
TITLE II--FEDERAL HOME LOAN BANKS
Sec. 201. Definitions.CommentsClose CommentsPermalink
Sec. 202. Directors.CommentsClose CommentsPermalink
Sec. 203. Federal Housing Finance Agency oversight of Federal Home Loan Banks.CommentsClose CommentsPermalink
Sec. 204. Joint activities of Banks.CommentsClose CommentsPermalink
Sec. 205. Sharing of information between Federal Home Loan Banks.CommentsClose CommentsPermalink
Sec. 206. Reorganization of Banks and voluntary merger.CommentsClose CommentsPermalink
Sec. 207. Securities and Exchange Commission disclosure.CommentsClose CommentsPermalink
Sec. 208. Community financial institution members.CommentsClose CommentsPermalink
Sec. 209. Technical and conforming amendments.CommentsClose CommentsPermalink
Sec. 210. Study of affordable housing program use for long-term care facilities.CommentsClose CommentsPermalink
Sec. 211. Effective date.CommentsClose CommentsPermalink
TITLE III--TRANSFER OF FUNCTIONS, PERSONNEL, AND PROPERTY OF OFFICE OF FEDERAL HOUSING ENTERPRISE OVERSIGHT, FEDERAL HOUSING FINANCE BOARD, AND DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Subtitle A--Office of Federal Housing Enterprise Oversight
Sec. 301. Abolishment of OFHEO.CommentsClose CommentsPermalink
Sec. 302. Continuation and coordination of certain regulations.CommentsClose CommentsPermalink
Sec. 303. Transfer and rights of employees of OFHEO.CommentsClose CommentsPermalink
Sec. 304. Transfer of property and facilities.CommentsClose CommentsPermalink
Subtitle B--Federal Housing Finance Board
Sec. 321. Abolishment of the Federal Housing Finance Board.CommentsClose CommentsPermalink
Sec. 322. Continuation and coordination of certain regulations.CommentsClose CommentsPermalink
Sec. 323. Transfer and rights of employees of the Federal Housing Finance Board.CommentsClose CommentsPermalink
Sec. 324. Transfer of property and facilities.CommentsClose CommentsPermalink
Subtitle C--Department of Housing and Urban Development
Sec. 341. Termination of enterprise-related functions.CommentsClose CommentsPermalink
Sec. 342. Continuation and coordination of certain regulations.CommentsClose CommentsPermalink
Sec. 343. Transfer and rights of employees of Department of Housing and Urban Development.CommentsClose CommentsPermalink
Sec. 344. Transfer of appropriations, property, and facilities.CommentsClose CommentsPermalink
SEC. 2. DEFINITIONS.
Section 1303 of the Housing and Community Development Act of 1992 (
(1) in paragraph (7), by striking `an enterprise' and inserting `a regulated entity';CommentsClose CommentsPermalink
(2) by striking `the enterprise' each place such term appears (except in paragraphs (4) and (18)) and inserting `the regulated entity';CommentsClose CommentsPermalink
(3) in paragraph (5), by striking `Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development' and inserting `Federal Housing Finance Agency';CommentsClose CommentsPermalink
(4) in each of paragraphs (8), (9), (10), and (19), by striking `Secretary' each place that term appears and inserting `Director';CommentsClose CommentsPermalink
(5) in paragraph (13), by inserting `, with respect to an enterprise,' after `means';CommentsClose CommentsPermalink
(6) by redesignating paragraphs (16) through (19) as paragraphs (20) through (23), respectively;CommentsClose CommentsPermalink
(7) by striking paragraphs (14) and (15) and inserting the following new paragraphs:CommentsClose CommentsPermalink
`(18) REGULATED ENTITY- The term `regulated entity' means--CommentsClose CommentsPermalink
`(A) the Federal National Mortgage Association and any affiliate thereof;CommentsClose CommentsPermalink
`(B) the Federal Home Loan Mortgage Corporation and any affiliate thereof; andCommentsClose CommentsPermalink
`(C) each Federal home loan bank.CommentsClose CommentsPermalink
`(19) REGULATED ENTITY-AFFILIATED PARTY- The term `regulated entity-affiliated party' means--CommentsClose CommentsPermalink
`(A) any director, officer, employee, or agent for, a regulated entity, or controlling shareholder of an enterprise;CommentsClose CommentsPermalink
`(B) any shareholder, affiliate, consultant, or joint venture partner of a regulated entity, and any other person, as determined by the Director (by regulation or on a case-by-case basis) that participates in the conduct of the affairs of a regulated entity, except that a shareholder of a regulated entity shall not be considered to have participated in the affairs of that regulated entity solely by reason of being a member or customer of the regulated entity;CommentsClose CommentsPermalink
`(C) any independent contractor for a regulated entity (including any attorney, appraiser, or accountant), if--CommentsClose CommentsPermalink
`(i) the independent contractor knowingly or recklessly participates in--CommentsClose CommentsPermalink
`(I) any violation of any law or regulation;CommentsClose CommentsPermalink
`(II) any breach of fiduciary duty; orCommentsClose CommentsPermalink
`(III) any unsafe or unsound practice; andCommentsClose CommentsPermalink
`(ii) such violation, breach, or practice caused, or is likely to cause, more than a minimal financial loss to, or a significant adverse effect on, the regulated entity; andCommentsClose CommentsPermalink
`(D) any not-for-profit corporation that receives its principal funding, on an ongoing basis, from any regulated entity.'.CommentsClose CommentsPermalink
(8) by redesignating paragraphs (8) through (13) as paragraphs (12) through (17), respectively; andCommentsClose CommentsPermalink
(9) by inserting after paragraph (7) the following new paragraph:CommentsClose CommentsPermalink
`(11) FEDERAL HOME LOAN BANK- The term `Federal home loan bank' means a bank established under the authority of the Federal Home Loan Bank Act.';CommentsClose CommentsPermalink
(10) by redesignating paragraphs (2) through (7) as paragraphs (5) through (10), respectively; andCommentsClose CommentsPermalink
(11) by inserting after paragraph (1) the following new paragraphs:CommentsClose CommentsPermalink
`(2) AGENCY- The term `Agency' means the Federal Housing Finance Agency.CommentsClose CommentsPermalink
`(3) AUTHORIZING STATUTES- The term `authorizing statutes' means--CommentsClose CommentsPermalink
`(A) the Federal National Mortgage Association Charter Act;CommentsClose CommentsPermalink
`(B) the Federal Home Loan Mortgage Corporation Act; andCommentsClose CommentsPermalink
`(C) the Federal Home Loan Bank Act.CommentsClose CommentsPermalink
`(4) BOARD- The term `Board' means the Federal Housing Enterprise Board established under section 1313B.'.CommentsClose CommentsPermalink
TITLE I--REFORM OF REGULATION OF ENTERPRISES AND FEDERAL HOME LOAN BANKS
Subtitle A--Improvement of Safety and Soundness
SEC. 101. ESTABLISHMENT OF THE FEDERAL HOUSING FINANCE AGENCY.
(a) In General- The Housing and Community Development Act of 1992 (
`SEC. 1311. ESTABLISHMENT OF THE FEDERAL HOUSING FINANCE AGENCY.
`(a) Establishment- There is established the Federal Housing Finance Agency, which shall be an independent agency of the Federal Government.CommentsClose CommentsPermalink
`(b) General Supervisory and Regulatory Authority-CommentsClose CommentsPermalink
`(1) IN GENERAL- Each regulated entity shall, to the extent provided in this title, be subject to the supervision and regulation of the Agency.CommentsClose CommentsPermalink
`(2) AUTHORITY OVER FANNIE MAE, FREDDIE MAC, AND FEDERAL HOME LOAN BANKS- The Director of the Federal Housing Finance Agency shall have general supervisory and regulatory authority over each regulated entity and shall exercise such general regulatory and supervisory authority, including such duties and authorities set forth under section 1313 of this Act, to ensure that the purposes of this Act, the authorizing statutes, and any other applicable law are carried out. The Director shall have the same supervisory and regulatory authority over any joint office of the Federal home loan banks, including the Office of Finance of the Federal Home Loan Banks, as the Director has over the individual Federal home loan banks.CommentsClose CommentsPermalink
`(c) Savings Provision- The authority of the Director to take actions under subtitles B and C shall not in any way limit the general supervisory and regulatory authority granted to the Director.CommentsClose CommentsPermalink
`SEC. 1312. DIRECTOR.
`(a) Establishment of Position- There is established the position of the Director of the Federal Housing Finance Agency, who shall be the head of the Agency.CommentsClose CommentsPermalink
`(b) Appointment; Term-CommentsClose CommentsPermalink
`(1) APPOINTMENT- The Director shall be appointed by the President, by and with the advice and consent of the Senate, from among individuals who are citizens of the United States, have a demonstrated understanding of financial management or oversight, and have a demonstrated understanding of capital markets, including the mortgage securities markets and housing finance.CommentsClose CommentsPermalink
`(2) TERM AND REMOVAL- The Director shall be appointed for a term of 5 years and may be removed by the President only for cause.CommentsClose CommentsPermalink
`(3) VACANCY- A vacancy in the position of Director that occurs before the expiration of the term for which a Director was appointed shall be filled in the manner established under paragraph (1), and the Director appointed to fill such vacancy shall be appointed only for the remainder of such term.CommentsClose CommentsPermalink
`(4) SERVICE AFTER END OF TERM- An individual may serve as the Director after the expiration of the term for which appointed until a successor has been appointed.CommentsClose CommentsPermalink
`(5) TRANSITIONAL PROVISION- Notwithstanding paragraphs (1) and (2), the Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development shall serve as the Director until a successor has been appointed under paragraph (1).CommentsClose CommentsPermalink
`(c) Deputy Director of the Division of Enterprise Regulation-CommentsClose CommentsPermalink
`(1) IN GENERAL- The Agency shall have a Deputy Director of the Division of Enterprise Regulation, who shall be appointed by the Director from among individuals who are citizens of the United States, and have a demonstrated understanding of financial management or oversight and of mortgage securities markets and housing finance.CommentsClose CommentsPermalink
`(2) FUNCTIONS- The Deputy Director of the Division of Enterprise Regulation shall have such functions, powers, and duties with respect to the oversight of the enterprises as the Director shall prescribe.CommentsClose CommentsPermalink
`(d) Deputy Director of the Division of Federal Home Loan Bank Regulation-CommentsClose CommentsPermalink
`(1) IN GENERAL- The Agency shall have a Deputy Director of the Division of Federal Home Loan Bank Regulation, who shall be appointed by the Director from among individuals who are citizens of the United States, have a demonstrated understanding of financial management or oversight and of the Federal Home Loan Bank System and housing finance.CommentsClose CommentsPermalink
`(2) FUNCTIONS- The Deputy Director of the Division of Federal Home Loan Bank Regulation shall have such functions, powers, and duties with respect to the oversight of the Federal home loan banks as the Director shall prescribe.CommentsClose CommentsPermalink
`(e) Deputy Director for Housing-CommentsClose CommentsPermalink
`(1) IN GENERAL- The Agency shall have a Deputy Director for Housing, who shall be appointed by the Director from among individuals who are citizens of the United States, and have a demonstrated understanding of the housing markets and housing finance and of community and economic development.CommentsClose CommentsPermalink
`(2) FUNCTIONS- The Deputy Director for Housing shall have such functions, powers, and duties with respect to the oversight of the housing mission and goals of the enterprises, and with respect to oversight of the housing finance and community and economic development mission of the Federal home loan banks, as the Director shall prescribe.CommentsClose CommentsPermalink
`(f) Limitations- The Director and each of the Deputy Directors may not--CommentsClose CommentsPermalink
`(1) have any direct or indirect financial interest in any regulated entity or regulated entity-affiliated party;CommentsClose CommentsPermalink
`(2) hold any office, position, or employment in any regulated entity or regulated entity-affiliated party; orCommentsClose CommentsPermalink
`(3) have served as an executive officer or director of any regulated entity, or regulated entity-affiliated party, at any time during the 3-year period ending on the date of appointment of such individual as Director or Deputy Director.CommentsClose CommentsPermalink
`(g) Ombudsman- The Director shall establish the position of the Ombudsman in the Agency. The Director shall provide that the Ombudsman will consider complaints and appeals from any regulated entity and any person that has a business relationship with a regulated entity and shall specify the duties and authority of the Ombudsman.'.CommentsClose CommentsPermalink
(b) Appointment of Director- Notwithstanding any other provision of law or of this Act, the President may, any time after the date of the enactment of this Act, appoint an individual to serve as the Director of the Federal Housing Finance Agency, as such office is established by the amendment made by subsection (a). This subsection shall take effect on the date of the enactment of this Act.CommentsClose CommentsPermalink
SEC. 102. DUTIES AND AUTHORITIES OF DIRECTOR.
(a) In General- The Housing and Community Development Act of 1992 (
`SEC. 1313. DUTIES AND AUTHORITIES OF DIRECTOR.
`(a) Duties-CommentsClose CommentsPermalink
`(1) PRINCIPAL DUTIES- The principal duties of the Director shall be--CommentsClose CommentsPermalink
`(A) to oversee the operations of each regulated entity and any joint office of the Federal Home Loan Banks; andCommentsClose CommentsPermalink
`(B) to ensure that--CommentsClose CommentsPermalink
`(i) each regulated entity operates in a safe and sound manner, including maintenance of adequate capital and internal controls;CommentsClose CommentsPermalink
`(ii) the operations and activities of each regulated entity foster liquid, efficient, competitive, and resilient national housing finance markets that minimize the cost of housing finance (including activities relating to mortgages on housing for low- and moderate- income families involving a reasonable economic return that may be less than the return earned on other activities);CommentsClose CommentsPermalink
`(iii) each regulated entity complies with this title and the rules, regulations, guidelines, and orders issued under this title and the authorizing statutes; andCommentsClose CommentsPermalink
`(iv) each regulated entity carries out its statutory mission only through activities that are consistent with this title and the authorizing statutes.CommentsClose CommentsPermalink
`(2) SCOPE OF AUTHORITY- The authority of the Director shall include the authority--CommentsClose CommentsPermalink
`(A) to review and, if warranted based on the principal duties described in paragraph (1), reject any acquisition or transfer of a controlling interest in an enterprise; andCommentsClose CommentsPermalink
`(B) to exercise such incidental powers as may be necessary or appropriate to fulfill the duties and responsibilities of the Director in the supervision and regulation of each regulated entity.CommentsClose CommentsPermalink
`(b) Delegation of Authority- The Director may delegate to officers or employees of the Agency, including each of the Deputy Directors, any of the functions, powers, or duties of the Director, as the Director considers appropriate.CommentsClose CommentsPermalink
`(c) Litigation Authority-CommentsClose CommentsPermalink
`(1) IN GENERAL- In enforcing any provision of this title, any regulation or order prescribed under this title, or any other provision of law, rule, regulation, or order, or in any other action, suit, or proceeding to which the Director is a party or in which the Director is interested, and in the administration of conservatorships and receiverships, the Director may act in the Director's own name and through the Director's own attorneys, or request that the Attorney General of the United States act on behalf of the Director.CommentsClose CommentsPermalink
`(2) CONSULTATION WITH ATTORNEY GENERAL- The Director shall provide notice to, and consult with, the Attorney General of the United States before taking an action under paragraph (1) of this subsection or under section 1344(a), 1345(d), 1348(c), 1372(e), 1375(a), 1376(d), or 1379D(c), except that, if the Director determines that any delay caused by such prior notice and consultation may adversely affect the safety and soundness responsibilities of the Director under this title, the Director shall notify the Attorney General as soon as reasonably possible after taking such action.CommentsClose CommentsPermalink
`(3) SUBJECT TO SUIT- Except as otherwise provided by law, the Director shall be subject to suit (other than suits on claims for money damages) by a regulated entity or director or officer thereof with respect to any matter under this title or any other applicable provision of law, rule, order, or regulation under this title, in the United States district court for the judicial district in which the regulated entity has its principal place of business, or in the United States District Court for the District of Columbia, and the Director may be served with process in the manner prescribed by the Federal Rules of Civil Procedure.CommentsClose CommentsPermalink
`SEC. 1313A. PRUDENTIAL MANAGEMENT AND OPERATIONS STANDARDS.
`(a) Standards- The Director shall establish standards, by regulation, guideline, or order, for each regulated entity relating to--CommentsClose CommentsPermalink
`(1) adequacy of internal controls and information systems, including information security and privacy policies and practices, taking into account the nature and scale of business operations;CommentsClose CommentsPermalink
`(2) independence and adequacy of internal audit systems;CommentsClose CommentsPermalink
`(3) management of credit and counterparty risk, including systems to identify concentrations of credit risk and prudential limits to restrict exposure of the regulated entity to a single counterparty or groups of related counterparties;CommentsClose CommentsPermalink
`(4) management of interest rate risk exposure;CommentsClose CommentsPermalink
`(5) management of market risk, including standards that provide for systems that accurately measure, monitor, and control market risks and, as warranted, that establish limitations on market risk;CommentsClose CommentsPermalink
`(6) adequacy and maintenance of liquidity and reserves;CommentsClose CommentsPermalink
`(7) management of any asset and investment portfolio;CommentsClose CommentsPermalink
`(8) investments and acquisitions by a regulated entity, to ensure that they are consistent with the purposes of this Act and the authorizing statutes;CommentsClose CommentsPermalink
`(9) maintenance of adequate records, in accordance with consistent accounting policies and practices that enable the Director to evaluate the financial condition of the regulated entity;CommentsClose CommentsPermalink
`(10) issuance of subordinated debt by that particular regulated entity, as the Director considers necessary;CommentsClose CommentsPermalink
`(11) overall risk management processes, including adequacy of oversight by senior management and the board of directors and of processes and policies to identify, measure, monitor, and control material risks, including reputational risks, and for adequate, well-tested business resumption plans for all major systems with remote site facilities to protect against disruptive events; andCommentsClose CommentsPermalink
`(12) such other operational and management standards as the Director determines to be appropriate.CommentsClose CommentsPermalink
`(b) Failure To Meet Standards-CommentsClose CommentsPermalink
`(1) PLAN REQUIREMENT-CommentsClose CommentsPermalink
`(A) IN GENERAL- If the Director determines that a regulated entity fails to meet any standard established under subsection (a)--CommentsClose CommentsPermalink
`(i) if such standard is established by regulation, the Director shall require the regulated entity to submit an acceptable plan to the Director within the time allowed under subparagraph (C); andCommentsClose CommentsPermalink
`(ii) if such standard is established by guideline, the Director may require the regulated entity to submit a plan described in clause (i).CommentsClose CommentsPermalink
`(B) CONTENTS- Any plan required under subparagraph (A) shall specify the actions that the regulated entity will take to correct the deficiency. If the regulated entity is undercapitalized, the plan may be a part of the capital restoration plan for the regulated entity under section 1369C.CommentsClose CommentsPermalink
`(C) DEADLINES FOR SUBMISSION AND REVIEW- The Director shall by regulation establish deadlines that--CommentsClose CommentsPermalink
`(i) provide the regulated entities with reasonable time to submit plans required under subparagraph (A), and generally require a regulated entity to submit a plan not later than 30 days after the Director determines that the entity fails to meet any standard established under subsection (a); andCommentsClose CommentsPermalink
`(ii) require the Director to act on plans expeditiously, and generally not later than 30 days after the plan is submitted.CommentsClose CommentsPermalink
`(2) REQUIRED ORDER UPON FAILURE TO SUBMIT OR IMPLEMENT PLAN- If a regulated entity fails to submit an acceptable plan within the time allowed under paragraph (1)(C), or fails in any material respect to implement a plan accepted by the Director, the following shall apply:CommentsClose CommentsPermalink
`(A) REQUIRED CORRECTION OF DEFICIENCY- The Director shall, by order, require the regulated entity to correct the deficiency.CommentsClose CommentsPermalink
`(B) OTHER AUTHORITY- The Director may, by order, take one or more of the following actions until the deficiency is corrected:CommentsClose CommentsPermalink
`(i) Prohibit the regulated entity from permitting its average total assets (as such term is defined in section 1316(b)) during any calendar quarter to exceed its average total assets during the preceding calendar quarter, or restrict the rate at which the average total assets of the entity may increase from one calendar quarter to another.CommentsClose CommentsPermalink
`(ii) Require the regulated entity--CommentsClose CommentsPermalink
`(I) in the case of an enterprise, to increase its ratio of core capital to assets.CommentsClose CommentsPermalink
`(II) in the case of a Federal home loan bank, to increase its ratio of total capital (as such term is defined in section 6(a)(5) of the Federal Home Loan Bank Act (
`(iii) Require the regulated entity to take any other action that the Director determines will better carry out the purposes of this section than any of the actions described in this subparagraph.CommentsClose CommentsPermalink
`(3) MANDATORY RESTRICTIONS- In complying with paragraph (2), the Director shall take one or more of the actions described in clauses (i) through (iii) of paragraph (2)(B) if--CommentsClose CommentsPermalink
`(A) the Director determines that the regulated entity fails to meet any standard prescribed under subsection (a);CommentsClose CommentsPermalink
`(B) the regulated entity has not corrected the deficiency; andCommentsClose CommentsPermalink
`(C) during the 18-month period before the date on which the regulated entity first failed to meet the standard, the entity underwent extraordinary growth, as defined by the Director.CommentsClose CommentsPermalink
`(c) Other Enforcement Authority Not Affected- The authority of the Director under this section is in addition to any other authority of the Director.'.CommentsClose CommentsPermalink
(b) Independence in Congressional Testimony and Recommendations- Section 111 of
SEC. 103. FEDERAL HOUSING ENTERPRISE BOARD.
(a) In General- Title XIII of the Housing and Community Development Act of 1992 (
`SEC. 1313B. FEDERAL HOUSING ENTERPRISE BOARD.
`(a) In General- There is established the Federal Housing Enterprise Board, which shall advise the Director with respect to overall strategies and policies in carrying out the duties of the Director under this title.CommentsClose CommentsPermalink
`(b) Limitations- The Board may not exercise any executive authority, and the Director may not delegate to the Board any of the functions, powers, or duties of the Director.CommentsClose CommentsPermalink
`(c) Composition- The Board shall be comprised of 3 members, of whom--CommentsClose CommentsPermalink
`(1) one member shall be the Secretary of the Treasury;CommentsClose CommentsPermalink
`(2) one member shall be the Secretary of Housing and Urban Development; andCommentsClose CommentsPermalink
`(3) one member shall be the Director, who shall serve as the Chairperson of the Board.CommentsClose CommentsPermalink
`(d) Meetings-CommentsClose CommentsPermalink
`(1) IN GENERAL- The Board shall meet upon notice by the Director, but in no event shall the Board meet less frequently than once every 3 months.CommentsClose CommentsPermalink
`(2) SPECIAL MEETINGS- Either the Secretary of the Treasury or the Secretary of Housing and Urban Development may, upon giving written notice to the Director, require a special meeting of the Board.CommentsClose CommentsPermalink
`(e) Testimony- On an annual basis, the Board shall testify before Congress regarding--CommentsClose CommentsPermalink
`(1) the safety and soundness of the regulated entities;CommentsClose CommentsPermalink
`(2) any material deficiencies in the conduct of the operations of the regulated entities;CommentsClose CommentsPermalink
`(3) the overall operational status of the regulated entities;CommentsClose CommentsPermalink
`(4) an evaluation of the performance of the regulated entities in carrying out their respective missions;CommentsClose CommentsPermalink
`(5) operations, resources, and performance of the Agency; andCommentsClose CommentsPermalink
`(6) such other matters relating to the Agency and its fulfillment of its mission, as the Board determines appropriate.'.CommentsClose CommentsPermalink
(b) Annual Report of the Director- Section 1319B(a) of the Housing and Community Development Act of 1992 (
(1) in paragraph (3), by striking `and' at the end; andCommentsClose CommentsPermalink
(2) by striking paragraph (4) and inserting the following new paragraphs:CommentsClose CommentsPermalink
`(4) an assessment of the Board or any of its members with respect to--CommentsClose CommentsPermalink
`(A) the safety and soundness of the regulated entities;CommentsClose CommentsPermalink
`(B) any material deficiencies in the conduct of the operations of the regulated entities;CommentsClose CommentsPermalink
`(C) the overall operational status of the regulated entities; andCommentsClose CommentsPermalink
`(D) an evaluation of the performance of the regulated entities in carrying out their missions;CommentsClose CommentsPermalink
`(5) operations, resources, and performance of the Agency;CommentsClose CommentsPermalink
`(6) a description of the demographic makeup of the workforce of the Agency and the actions taken pursuant to section 1319A(b) to provide for diversity in the workforce; andCommentsClose CommentsPermalink
`(7) such other matters relating to the Agency and its fulfillment of its mission.'.CommentsClose CommentsPermalink
SEC. 104. AUTHORITY TO REQUIRE REPORTS BY REGULATED ENTITIES.
Section 1314 of the Housing and Community Development Act of 1992 (
(1) in the section heading, by striking `enterprises' and inserting `regulated entities';CommentsClose CommentsPermalink
(2) in subsection (a)--CommentsClose CommentsPermalink
(A) in the subsection heading, by striking `Special Reports and Reports of Financial Condition' and inserting `Regular and Special Reports';CommentsClose CommentsPermalink
(B) in paragraph (1)--CommentsClose CommentsPermalink
(i) in the paragraph heading, by striking `FINANCIAL CONDITION' and inserting `REGULAR REPORTS'; andCommentsClose CommentsPermalink
(ii) by striking `reports of financial condition and operations' and inserting `regular reports on the condition (including financial condition), management, activities, or operations of the regulated entity, as the Director considers appropriate'; andCommentsClose CommentsPermalink
(C) in paragraph (2), after `submit special reports' insert `on any of the topics specified in paragraph (1) or such other topics'; andCommentsClose CommentsPermalink
(3) by adding at the end the following new subsection:CommentsClose CommentsPermalink
`(c) Reports of Fraudulent Financial Transactions-CommentsClose CommentsPermalink
`(1) REQUIREMENT TO REPORT- The Director shall require a regulated entity to submit to the Director a timely report upon discovery by the regulated entity that it has purchased or sold a fraudulent loan or financial instrument or suspects a possible fraud relating to a purchase or sale of any loan or financial instrument. The Director shall require the regulated entities to establish and maintain procedures designed to discover any such transactions.CommentsClose CommentsPermalink
`(2) PROTECTION FROM LIABILITY FOR REPORTS-CommentsClose CommentsPermalink
`(A) IN GENERAL- If a regulated entity makes a report pursuant to paragraph (1), or a regulated entity-affiliated party makes, or requires another to make, such a report, and such report is made in a good faith effort to comply with the requirements of paragraph (1), such regulated entity or regulated entity-affiliated party shall not be liable to any person under any law or regulation of the United States, any constitution, law, or regulation of any State or political subdivision of any State, or under any contract or other legally enforceable agreement (including any arbitration agreement), for such report or for any failure to provide notice of such report to the person who is the subject of such report or any other person identified in the report.CommentsClose CommentsPermalink
`(B) RULE OF CONSTRUCTION- Subparagraph (A) shall not be construed as creating--CommentsClose CommentsPermalink
`(i) any inference that the term `person', as used in such subparagraph, may be construed more broadly than its ordinary usage so as to include any government or agency of government; orCommentsClose CommentsPermalink
`(ii) any immunity against, or otherwise affecting, any civil or criminal action brought by any government or agency of government to enforce any constitution, law, or regulation of such government or agency.'.CommentsClose CommentsPermalink
SEC. 105. DISCLOSURE OF INCOME AND CHARITABLE CONTRIBUTIONS BY ENTERPRISES.
Section 1314 of the Housing and Community Development Act of 1992 (
`(d) Disclosure of Charitable Contributions by Enterprises-CommentsClose CommentsPermalink
`(1) REQUIRED DISCLOSURE- The Director shall, by regulation, require each enterprise to submit a report annually, in a format designated by the Director, containing the following information:CommentsClose CommentsPermalink
`(A) TOTAL VALUE- The total value of contributions made by the enterprise to nonprofit organizations during its previous fiscal year.CommentsClose CommentsPermalink
`(B) SUBSTANTIAL CONTRIBUTIONS- If the value of contributions made by the enterprise to any nonprofit organization during its previous fiscal year exceeds the designated amount, the name of that organization and the value of contributions.CommentsClose CommentsPermalink
`(C) SUBSTANTIAL CONTRIBUTIONS TO INSIDER-AFFILIATED CHARITIES- Identification of each contribution whose value exceeds the designated amount that were made by the enterprise during the enterprise's previous fiscal year to any nonprofit organization of which a director, officer, or controlling person of the enterprise, or a spouse thereof, was a director or trustee, the name of such nonprofit organization, and the value of the contribution.CommentsClose CommentsPermalink
`(2) DEFINITIONS- For purposes of this subsection--CommentsClose CommentsPermalink
`(A) the term `designated amount' means such amount as may be designated by the Director by regulation, consistent with the public interest and the protection of investors for purposes of this subsection; andCommentsClose CommentsPermalink
`(B) the Director may, by such regulations as the Director deems necessary or appropriate in the public interest, define the terms officer and controlling person.CommentsClose CommentsPermalink
`(3) PUBLIC AVAILABILITY- The Director shall make the information submitted pursuant to this subsection publicly available.CommentsClose CommentsPermalink
`(e) Disclosure of Income- Each enterprise shall include, in each annual report filed under section 13 of the Securities Exchange Act of 1934 (
`(1) be presented in a prominent location in each such report and in a manner that permits a ready comparison of such income to income otherwise required to be included in such reports under regulations issued under such section; andCommentsClose CommentsPermalink
`(2) be submitted to the Securities and Exchange Commission in a form and manner suitable for entry into the EDGAR system of such Commission for public availability under such system.'.CommentsClose CommentsPermalink
SEC. 106. ASSESSMENTS.
Section 1316 of the Housing and Community Development Act of 1992 (
(1) by striking subsection (a) and inserting the following new subsection:CommentsClose CommentsPermalink
`(a) Annual Assessments- The Director shall establish and collect from the regulated entities annual assessments in an amount not exceeding the amount sufficient to provide for reasonable costs and expenses of the Agency, including--CommentsClose CommentsPermalink
`(1) the expenses of any examinations under section 1317 of this Act and under section 20 of the Federal Home Loan Bank Act;CommentsClose CommentsPermalink
`(2) the expenses of obtaining any reviews and credit assessments under section 1319;CommentsClose CommentsPermalink
`(3) such amounts in excess of actual expenses for any given year as deemed necessary by the Director to maintain a working capital fund in accordance with subsection (e); andCommentsClose CommentsPermalink
`(4) the wind up of the affairs of the Office of Federal Housing Enterprise Oversight and the Federal Housing Finance Board under title III of the Federal Housing Finance Reform Act of 2007.';CommentsClose CommentsPermalink
(2) in subsection (b)--CommentsClose CommentsPermalink
(A) in the subsection heading, by striking `Enterprises' and inserting `Regulated Entities' ;CommentsClose CommentsPermalink
(B) by realigning paragraph (2) two ems from the left margin, so as to align the left margin of such paragraph with the left margins of paragraph (1);CommentsClose CommentsPermalink
(C) in paragraph (1)--CommentsClose CommentsPermalink
(i) by striking `Each enterprise' and inserting `Each regulated entity';CommentsClose CommentsPermalink
(ii) by striking `each enterprise' and inserting `each regulated entity'; andCommentsClose CommentsPermalink
(iii) by striking `both enterprises' and inserting `all of the regulated entities'; andCommentsClose CommentsPermalink
(D) in paragraph (3)--CommentsClose CommentsPermalink
(i) in subparagraph (B), by striking `subparagraph (A)' and inserting `clause (i)';CommentsClose CommentsPermalink
(ii) by redesignating subparagraphs (A), (B), and (C) as clauses (i), (ii) and (ii), respectively, and realigning such clauses, as so redesignated, so as to be indented 6 ems from the left margin;CommentsClose CommentsPermalink
(iii) by striking the matter that precedes clause (i), as so redesignated, and inserting the following:CommentsClose CommentsPermalink
`(3) DEFINITION OF TOTAL ASSETS- For purposes of this section, the term `total assets' means as follows:CommentsClose CommentsPermalink
`(A) ENTERPRISES- With respect to an enterprise, the sum of--'; andCommentsClose CommentsPermalink
(iv) by adding at the end the following new subparagraph:CommentsClose CommentsPermalink
`(B) FEDERAL HOME LOAN BANKS- With respect to a Federal home loan bank, the total assets of the Bank, as determined by the Director in accordance with generally accepted accounting principles.';CommentsClose CommentsPermalink
(3) by striking subsection (c) and inserting the following new subsection:CommentsClose CommentsPermalink
`(c) Increased Costs of Regulation-CommentsClose CommentsPermalink
`(1) INCREASE FOR INADEQUATE CAPITALIZATION- The semiannual payments made pursuant to subsection (b) by any regulated entity that is not classified (for purposes of subtitle B) as adequately capitalized may be increased, as necessary, in the discretion of the Director to pay additional estimated costs of regulation of the regulated entity.CommentsClose CommentsPermalink
`(2) ADJUSTMENT FOR ENFORCEMENT ACTIVITIES- The Director may adjust the amounts of any semiannual payments for an assessment under subsection (a) that are to be paid pursuant to subsection (b) by a regulated entity, as necessary in the discretion of the Director, to ensure that the costs of enforcement activities under this Act for a regulated entity are borne only by such regulated entity.CommentsClose CommentsPermalink
`(3) ADDITIONAL ASSESSMENT FOR DEFICIENCIES- If at any time, as a result of increased costs of regulation of a regulated entity that is not classified (for purposes of subtitle B) as adequately capitalized or as the result of supervisory or enforcement activities under this Act for a regulated entity, the amount available from any semiannual payment made by such regulated entity pursuant to subsection (b) is insufficient to cover the costs of the Agency with respect to such entity, the Director may make and collect from such regulated entity an immediate assessment to cover the amount of such deficiency for the semiannual period. If, at the end of any semiannual period during which such an assessment is made, any amount remains from such assessment, such remaining amount shall be deducted from the assessment for such regulated entity for the following semiannual period.';CommentsClose CommentsPermalink
(4) in subsection (d), by striking `If' and inserting `Except with respect to amounts collected pursuant to subsection (a)(3), if'; andCommentsClose CommentsPermalink
(5) by striking subsections (e) through (g) and inserting the following new subsections:CommentsClose CommentsPermalink
`(e) Working Capital Fund- At the end of each year for which an assessment under this section is made, the Director shall remit to each regulated entity any amount of assessment collected from such regulated entity that is attributable to subsection (a)(3) and is in excess of the amount the Director deems necessary to maintain a working capital fund.CommentsClose CommentsPermalink
`(f) Treatment of Assessments-CommentsClose CommentsPermalink
`(1) DEPOSIT- Amounts received by the Director from assessments under this section may be deposited by the Director in the manner provided in section 5234 of the Revised Statutes (
`(2) NOT GOVERNMENT FUNDS- The amounts received by the Director from any assessment under this section shall not be construed to be Government or public funds or appropriated money.CommentsClose CommentsPermalink
`(3) NO APPORTIONMENT OF FUNDS- Notwithstanding any other provision of law, the amounts received by the Director from any assessment under this section shall not be subject to apportionment for the purpose of chapter 15 of title 31, United States Code, or under any other authority.CommentsClose CommentsPermalink
`(4) USE OF FUNDS- The Director may use any amounts received by the Director from assessments under this section for compensation of the Director and other employees of the Agency and for all other expenses of the Director and the Agency.CommentsClose CommentsPermalink
`(5) AVAILABILITY OF OVERSIGHT FUND AMOUNTS- Notwithstanding any other provision of law, any amounts remaining in the Federal Housing Enterprises Oversight Fund established under this section (as in effect before the effective date under section 185 of the Federal Housing Finance Reform Act of 2007), and any amounts remaining from assessments on the Federal Home Loan banks pursuant to section 18(b) of the Federal Home Loan Bank Act (
`(6) TREASURY INVESTMENTS-CommentsClose CommentsPermalink
`(A) AUTHORITY- The Director may request the Secretary of the Treasury to invest such portions of amount received by the Director from assessments paid under this section that, in the Director's discretion, are not required to meet the current working needs of the Agency.CommentsClose CommentsPermalink
`(B) GOVERNMENT OBLIGATIONS- Pursuant to a request under subparagraph (A), the Secretary of the Treasury shall invest such amounts in government obligations guaranteed as to principal and interest by the United States with maturities suitable to the needs of Agency and bearing interest at a rate determined by the Secretary of the Treasury taking into consideration current market yields on outstanding marketable obligations of the United States of comparable maturity.CommentsClose CommentsPermalink
`(g) Budget and Financial Management-CommentsClose CommentsPermalink
`(1) FINANCIAL OPERATING PLANS AND FORECASTS- The Director shall provide to the Director of the Office of Management and Budget copies of the Director's financial operating plans and forecasts as prepared by the Director in the ordinary course of the Agency's operations, and copies of the quarterly reports of the Agency's financial condition and results of operations as prepared by the Director in the ordinary course of the Agency's operations.CommentsClose CommentsPermalink
`(2) FINANCIAL STATEMENTS- The Agency shall prepare annually a statement of assets and liabilities and surplus or deficit; a statement of income and expenses; and a statement of sources and application of funds.CommentsClose CommentsPermalink
`(3) FINANCIAL MANAGEMENT SYSTEMS- The Agency shall implement and maintain financial management systems that comply substantially with Federal financial management systems requirements, applicable Federal accounting standards, and that uses a general ledger system that accounts for activity at the transaction level.CommentsClose CommentsPermalink
`(4) ASSERTION OF INTERNAL CONTROLS- The Director shall provide to the Comptroller General an assertion as to the effectiveness of the internal controls that apply to financial reporting by the Agency, using the standards established in
`(5) RULE OF CONSTRUCTION- This subsection may not be construed as implying any obligation on the part of the Director to consult with or obtain the consent or approval of the Director of the Office of Management and Budget with respect to any reports, plans, forecasts, or other information referred to in paragraph (1) or any jurisdiction or oversight over the affairs or operations of the Agency.CommentsClose CommentsPermalink
`(h) Audit of Agency-CommentsClose CommentsPermalink
`(1) IN GENERAL- The Comptroller General shall annually audit the financial transactions of the Agency in accordance with the U.S. generally accepted government auditing standards as may be prescribed by the Comptroller General of the United States. The audit shall be conducted at the place or places where accounts of the Agency are normally kept. The representatives of the Government Accountability Office shall have access to the personnel and to all books, accounts, documents, papers, records (including electronic records), reports, files, and all other papers, automated data, things, or property belonging to or under the control of or used or employed by the Agency pertaining to its financial transactions and necessary to facilitate the audit, and such representatives shall be afforded full facilities for verifying transactions with the balances or securities held by depositories, fiscal agents, and custodians. All such books, accounts, documents, records, reports, files, papers, and property of the Agency shall remain in possession and custody of the Agency. The Comptroller General may obtain and duplicate any such books, accounts, documents, records, working papers, automated data and files, or other information relevant to such audit without cost to the Comptroller General and the Comptroller General's right of access to such information shall be enforceable pursuant to
`(2) REPORT- The Comptroller General shall submit to the Congress a report of each annual audit conducted under this subsection. The report to the Congress shall set forth the scope of the audit and shall include the statement of assets and liabilities and surplus or deficit, the statement of income and expenses, the statement of sources and application of funds, and such comments and information as may be deemed necessary to inform Congress of the financial operations and condition of the Agency, together with such recommendations with respect thereto as the Comptroller General may deem advisable. A copy of each report shall be furnished to the President and to the Agency at the time submitted to the Congress.CommentsClose CommentsPermalink
`(3) ASSISTANCE AND COSTS- For the purpose of conducting an audit under this subsection, the Comptroller General may, in the discretion of the Comptroller General, employ by contract, without regard to
SEC. 107. EXAMINERS AND ACCOUNTANTS.
(a) Examinations- Section 1317 of the Housing and Community Development Act of 1992 (
(1) in subsection (a), by adding after the period at the end the following: `Each examination under this subsection of a regulated entity shall include a review of the procedures required to be established and maintained by the regulated entity pursuant to section 1314(c) (relating to fraudulent financial transactions) and the report regarding each such examination shall describe any problems with such procedures maintained by the regulated entity.';CommentsClose CommentsPermalink
(2) in subsection (b)--CommentsClose CommentsPermalink
(A) by inserting `of a regulated entity' after `under this section'; andCommentsClose CommentsPermalink
(B) by striking `to determine the condition of an enterprise for the purpose of ensuring its financial safety and soundness' and inserting `or appropriate'; andCommentsClose CommentsPermalink
(3) in subsection (c)--CommentsClose CommentsPermalink
(A) in the second sentence, by inserting `to conduct examinations under this section' before the period; andCommentsClose CommentsPermalink
(B) in the third sentence, by striking `from amounts available in the Federal Housing Enterprises Oversight Fund'.CommentsClose CommentsPermalink
(b) Enhanced Authority To Hire Examiners and Accountants- Section 1317 of the Housing and Community Development Act of 1992 (
`(g) Appointment of Accountants, Economists, Specialists, and Examiners-CommentsClose CommentsPermalink
`(1) APPLICABILITY- This section applies with respect to any position of examiner, accountant, specialist in financial markets, specialist in information technology, and economist at the Agency, with respect to supervision and regulation of the regulated entities, that is in the competitive service.CommentsClose CommentsPermalink
`(2) APPOINTMENT AUTHORITY- The Director may appoint candidates to any position described in paragraph (1)--CommentsClose CommentsPermalink
`(A) in accordance with the statutes, rules, and regulations governing appointments in the excepted service; andCommentsClose CommentsPermalink
`(B) notwithstanding any statutes, rules, and regulations governing appointments in the competitive service.CommentsClose CommentsPermalink
`(3) RULE OF CONSTRUCTION- The appointment of a candidate to a position under the authority of this subsection shall not be considered to cause such position to be converted from the competitive service to the excepted service.'.CommentsClose CommentsPermalink
(c) Repeal- Section 20 of the Federal Home Loan Bank Act (
(1) by striking the section heading and inserting the following: `EXAMINATIONS AND GAO AUDITS';CommentsClose CommentsPermalink
(2) in the third sentence, by striking `the Board and' each place such term appears; andCommentsClose CommentsPermalink
(3) by striking the first two sentences and inserting the following: `The Federal home loan banks shall be subject to examinations by the Director to the extent provided in section 1317 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (
SEC. 108. PROHIBITION AND WITHHOLDING OF EXECUTIVE COMPENSATION.
(a) In General- Section 1318 of the Housing and Community Development Act of 1992 (
(1) in the section heading, by striking `of excessive' and inserting `and withholding of executive';CommentsClose CommentsPermalink
(2) by redesignating subsection (b) as subsection (d); andCommentsClose CommentsPermalink
(3) by inserting after subsection (a) the following new subsections:CommentsClose CommentsPermalink
`(b) Factors- In making any determination under subsection (a), the Director may take into consideration any factors the Director considers relevant, including any wrongdoing on the part of the executive officer, and such wrongdoing shall include any fraudulent act or omission, breach of trust or fiduciary duty, violation of law, rule, regulation, order, or written agreement, and insider abuse with respect to the regulated entity. The approval of an agreement or contract pursuant to section 309(d)(3)(B) of the Federal National Mortgage Association Charter Act (
`(c) Withholding of Compensation- In carrying out subsection (a), the Director may require a regulated entity to withhold any payment, transfer, or disbursement of compensation to an executive officer, or to place such compensation in an escrow account, during the review of the reasonableness and comparability of compensation.'.CommentsClose CommentsPermalink
(b) Conforming Amendments-CommentsClose CommentsPermalink
(1) FANNIE MAE- Section 309(d) of the Federal National Mortgage Association Charter Act (
`(4) Notwithstanding any other provision of this section, the corporation shall not transfer, disburse, or pay compensation to any executive officer, or enter into an agreement with such executive officer, without the approval of the Director, for matters being reviewed under section 1318 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (
(2) FREDDIE MAC- Section 303(h) of the Federal Home Loan Mortgage Corporation Act (
`(4) Notwithstanding any other provision of this section, the Corporation shall not transfer, disburse, or pay compensation to any executive officer, or enter into an agreement with such executive officer, without the approval of the Director, for matters being reviewed under section 1318 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (
(3) FEDERAL HOME LOAN BANKS- Section 7 of the Federal Home Loan Bank Act (
`(l) Withholding of Compensation- Notwithstanding any other provision of this section, a Federal home loan bank shall not transfer, disburse, or pay compensation to any executive officer, or enter into an agreement with such executive officer, without the approval of the Director, for matters being reviewed under section 1318 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (
SEC. 109. REVIEWS OF REGULATED ENTITIES.
Section 1319 of the Housing and Community Development Act of 1992 (
(1) by striking the section designation and heading and inserting the following:CommentsClose CommentsPermalink
`SEC. 1319. REVIEWS OF REGULATED ENTITIES.';
andCommentsClose CommentsPermalink
(2) by striking `is a nationally recognized' and all that follows through `1934' and inserting the following: `the Director considers appropriate, including an entity that is registered under section 15 of the Securities Exchange Act of 1934 (
SEC. 110. INCLUSION OF MINORITIES AND WOMEN; DIVERSITY IN AGENCY WORKFORCE.
Section 1319A of the Housing and Community Development Act of 1992 (
(1) in the section heading, by striking `equal opportunity in solicitation of contracts' and inserting `minority and women inclusion; diversity requirements';CommentsClose CommentsPermalink
(2) in subsection (a), by striking `(a) In General- Each enterprise' and inserting `(e) Outreach- Each regulated entity'; andCommentsClose CommentsPermalink
(3) by striking subsection (b);CommentsClose CommentsPermalink
(4) by inserting before subsection (e), as so redesignated by paragraph (2) of this section, the following new subsections:CommentsClose CommentsPermalink
`(a) Office of Minority and Women Inclusion- Each regulated entity shall establish an Office of Minority and Women Inclusion, or designate an office of the entity, that shall be responsible for carrying out this section and all matters of the entity relating to diversity in management, employment, and business activities in accordance with such standards and requirements as the Director shall establish.CommentsClose CommentsPermalink
`(b) Inclusion in All Levels of Business Activities- Each regulated entity shall develop and implement standards and procedures to ensure, to the maximum extent possible, the inclusion and utilization of minorities (as such term is defined in section 1204(c) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (
`(c) Applicability- This section shall apply to all contracts of a regulated entity for services of any kind, including services that require the services of investment banking, asset management entities, broker-dealers, financial services entities, underwriters, accountants, investment consultants, and providers of legal services.CommentsClose CommentsPermalink
`(d) Inclusion in Annual Reports- Each regulated entity shall include, in the annual report submitted by the entity to the Director pursuant to section 309(k) of the Federal National Mortgage Association Charter Act (
(5) by adding at the end the following new subsection:CommentsClose CommentsPermalink
`(f) Diversity in Agency Workforce- The Agency shall take affirmative steps to seek diversity in its workforce at all levels of the agency consistent with the demographic diversity of the United States, which shall include--CommentsClose CommentsPermalink
`(1) heavily recruiting at historically Black colleges and universities, Hispanic-serving institutions, women's colleges, and colleges that typically serve majority minority populations;CommentsClose CommentsPermalink
`(2) sponsoring and recruiting at job fairs in urban communities, and placing employment advertisements in newspapers and magazines oriented toward women and people of color;CommentsClose CommentsPermalink
`(3) partnering with organizations that are focused on developing opportunities for minorities and women to place talented young minorities and women in industry internships, summer employment, and full-time positions; andCommentsClose CommentsPermalink
`(4) where feasible, partnering with inner-city high schools, girls' high schools, and high schools with majority minority populations to establish or enhance financial literacy programs and provide mentoring.'.CommentsClose CommentsPermalink
SEC. 111. REGULATIONS AND ORDERS.
Section 1319G of the Housing and Community Development Act of 1992 (
(1) by striking subsection (a) and inserting the following new subsection:CommentsClose CommentsPermalink
`(a) Authority- The Director shall issue any regulations, guidelines, and orders necessary to carry out the duties of the Director under this title and each of the authorizing statutes to ensure that the purposes of this title and such statutes are accomplished.';CommentsClose CommentsPermalink
(2) in subsection (b), by inserting `, this title, or any of the authorizing statutes' after `under this section'; andCommentsClose CommentsPermalink
(3) by striking subsection (c).CommentsClose CommentsPermalink
SEC. 112. NON-WAIVER OF PRIVILEGES.
Part 1 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (
`SEC. 1319H. PRIVILEGES NOT AFFECTED BY DISCLOSURE.
`(a) In General- The submission by any person of any information to the Agency for any purpose in the course of any supervisory or regulatory process of the Agency shall not be construed as waiving, destroying, or otherwise affecting any privilege such person may claim with respect to such information under Federal or State law as to any person or entity other than the Agency.CommentsClose CommentsPermalink
`(b) Rule of Construction- No provision of subsection (a) may be construed as implying or establishing that--CommentsClose CommentsPermalink
`(1) any person waives any privilege applicable to information that is submitted or transferred under any circumstance to which subsection (a) does not apply; orCommentsClose CommentsPermalink
`(2) any person would waive any privilege applicable to any information by submitting the information to the Agency, but for this subsection.'.CommentsClose CommentsPermalink
SEC. 113. RISK-BASED CAPITAL REQUIREMENTS.
(a) In General- Section 1361 of the Housing and Community Development Act of 1992 (
`SEC. 1361. RISK-BASED CAPITAL LEVELS FOR REGULATED ENTITIES.
`(a) In General-CommentsClose CommentsPermalink
`(1) ENTERPRISES- The Director shall, by regulation, establish risk-based capital requirements for the enterprises to ensure that the enterprises operate in a safe and sound manner, maintaining sufficient capital and reserves to support the risks that arise in the operations and management of the enterprises.CommentsClose CommentsPermalink
`(2) FEDERAL HOME LOAN BANKS- The Director shall establish risk-based capital standards under section 6 of the Federal Home Loan Bank Act for the Federal home loan banks.CommentsClose CommentsPermalink
`(b) Confidentiality of Information- Any person that receives any book, record, or information from the Director or a regulated entity to enable the risk-based capital requirements established under this section to be applied shall--CommentsClose CommentsPermalink
`(1) maintain the confidentiality of the book, record, or information in a manner that is generally consistent with the level of confidentiality established for the material by the Director or the regulated entity; andCommentsClose CommentsPermalink
`(2) be exempt from
`(c) No Limitation- Nothing in this section shall limit the authority of the Director to require other reports or undertakings, or take other action, in furtherance of the responsibilities of the Director under this Act.'.CommentsClose CommentsPermalink
(b) Federal Home Loan Banks Risk-Based Capital- Section 6(a)(3) of the Federal Home Loan Bank Act (
(1) by striking subparagraph (A) and inserting the following new subparagraph:CommentsClose CommentsPermalink
`(A) RISK-BASED CAPITAL STANDARDS- The Director shall, by regulation, establish risk-based capital standards for the Federal home loan banks to ensure that the Federal home loan banks operate in a safe and sound manner, with sufficient permanent capital and reserves to support the risks that arise in the operations and management of the Federal home loans banks.'; andCommentsClose CommentsPermalink
(2) in subparagraph (B), by striking `(A)(ii)' and inserting `(A)'.CommentsClose CommentsPermalink
SEC. 114. MINIMUM AND CRITICAL CAPITAL LEVELS.
(a) Minimum Capital Level- Section 1362 of the Housing and Community Development Act of 1992 (
(1) in subsection (a), by striking `In General' and inserting `Enterprises'; andCommentsClose CommentsPermalink
(2) by striking subsection (b) and inserting the following new subsections:CommentsClose CommentsPermalink
`(b) Federal Home Loan Banks- For purposes of this subtitle, the minimum capital level for each Federal home loan bank shall be the minimum capital required to be maintained to comply with the leverage requirement for the bank established under section 6(a)(2) of the Federal Home Loan Bank Act (
`(c) Establishment of Revised Minimum Capital Levels- Notwithstanding subsections (a) and (b) and notwithstanding the capital classifications of the regulated entities, the Director may, by regulations issued under section 1319G, establish a minimum capital level for the enterprises, for the Federal home loan banks, or for both the enterprises and the banks, that is higher than the level specified in subsection (a) for the enterprises or the level specified in subsection (b) for the Federal home loan banks, to the extent needed to ensure that the regulated entities operate in a safe and sound manner.CommentsClose CommentsPermalink
`(d) Authority To Require Temporary Increase- Notwithstanding subsections (a) and (b) and any minimum capital level established pursuant to subsection (c), the Director may, by order, increase the minimum capital level for a regulated entity on a temporary basis for such period as the Director may provide if the Director--CommentsClose CommentsPermalink
`(1) makes any determination specified in subparagraphs (A) through (C) of section 1364(c)(1);CommentsClose CommentsPermalink
`(2) determines that the regulated entity has violated any of the prudential standards established pursuant to section 1313A and, as a result of such violation, determines that an unsafe and unsound condition exists; orCommentsClose CommentsPermalink
`(3) determines that an unsafe and unsound condition exists, except that a temporary increase in minimum capital imposed on a regulated entity pursuant to this paragraph shall not remain in place for a period of more than 6 months unless the Director makes a renewed determination of the existence of an unsafe and unsound condition.CommentsClose CommentsPermalink
`(e) Authority To Establish Additional Capital and Reserve Requirements for Particular Programs- The Director may, at any time by order or regulation, establish such capital or reserve requirements with respect to any program or activity of a regulated entity as the Director considers appropriate to ensure that the regulated entity operates in a safe and sound manner, with sufficient capital and reserves to support the risks that arise in the operations and management of the regulated entity.CommentsClose CommentsPermalink
`(f) Periodic Review- The Director shall periodically review the amount of core capital maintained by the enterprises, the amount of capital retained by the Federal home loan banks, and the minimum capital levels established for such regulated entities pursuant to this section. The Director shall rescind any temporary minimum capital level increase if the Director determines that the circumstances or facts justifying the temporary increase are no longer present.'.CommentsClose CommentsPermalink
(b) Critical Capital Levels-CommentsClose CommentsPermalink
(1) IN GENERAL- Section 1363 of the Housing and Community Development Act of 1992 (
(A) by striking `For' and inserting `(a) Enterprises- For'; andCommentsClose CommentsPermalink
(B) by adding at the end the following new subsection:CommentsClose CommentsPermalink
`(b) Federal Home Loan Banks-CommentsClose CommentsPermalink
`(1) IN GENERAL- For purposes of this subtitle, the critical capital level for each Federal home loan bank shall be such amount of capital as the Director shall, by regulation require.CommentsClose CommentsPermalink
`(2) CONSIDERATION OF OTHER CRITICAL CAPITAL LEVELS- In establishing the critical capital level under paragraph (1) for the Federal home loan banks, the Director shall take due consideration of the critical capital level established under subsection (a) for the enterprises, with such modifications as the Director determines to be appropriate to reflect the difference in operations between the banks and the enterprises.'.CommentsClose CommentsPermalink
(2) REGULATIONS- Not later than the expiration of the 180-day period beginning on the effective date under section 185, the Director of the Federal Housing Finance Agency shall issue regulations pursuant to section 1363(b) of the Housing and Community Development Act of 1992 (as added by paragraph (1) of this subsection) establishing the critical capital level under such section.CommentsClose CommentsPermalink
SEC. 115. REVIEW OF AND AUTHORITY OVER ENTERPRISE ASSETS AND LIABILITIES.
(a) In General- Subtitle B of title XIII of the Housing and Community Development Act of 1992 (
(1) by striking the subtitle designation and heading and inserting the following:CommentsClose CommentsPermalink
`Subtitle B--Required Capital Levels for Regulated Entities, Special Enforcement Powers, and Reviews of Assets and Liabilities';
andCommentsClose CommentsPermalink
(2) by adding at the end the following new section:CommentsClose CommentsPermalink
`SEC. 1369E. REVIEWS OF ENTERPRISE ASSETS AND LIABILITIES.
`(a) In General- The Director shall, by regulation, establish standards by which the portfolio holdings, or rate of growth of the portfolio holdings, of the enterprises will be deemed to be consistent with the mission and the safe and sound operations of the enterprises. In developing such standards, the Director shall consider--CommentsClose CommentsPermalink
`(1) the size or growth of the mortgage market;CommentsClose CommentsPermalink
`(2) the need for the portfolio in maintaining liquidity or stability of the secondary mortgage market (including the market for the mortgage-backed securities the enterprises issue);CommentsClose CommentsPermalink
`(3) the need for an inventory of mortgages in connection with securitizations;CommentsClose CommentsPermalink
`(4) the need for the portfolio to directly support the affordable housing mission of the enterprises;CommentsClose CommentsPermalink
`(5) the liquidity needs of the enterprises;CommentsClose CommentsPermalink
`(6) any potential risks posed to the enterprises by the nature of the portfolio holdings; andCommentsClose CommentsPermalink
`(7) any additional factors that the Director determines to be necessary to carry out the purpose under the first sentence of this subsection to establish standards for assessing whether the portfolio holdings are consistent with the mission and safe and sound operations of the enterprises.CommentsClose CommentsPermalink
`(b) Temporary Adjustments- The Director may, by order, make temporary adjustments to the established standards for an enterprise or both enterprises, such as during times of economic distress or market disruption.CommentsClose CommentsPermalink
`(c) Authority To Require Disposition or Acquisition- The Director shall monitor the portfolio of each enterprise. Pursuant to subsection (a) and notwithstanding the capital classifications of the enterprises, the Director may, by order, require an enterprise, under such terms and conditions as the Director determines to be appropriate, to dispose of or acquire any asset, if the Director determines that such action is consistent with the purposes of this Act or any of the authorizing statutes.'.CommentsClose CommentsPermalink
(b) Regulations- Not later than the expiration of the 180-day period beginning on the effective date under section 185, the Director of the Federal Housing Finance Agency shall issue regulations pursuant to section 1369E(a) of the Housing and Community Development Act of 1992 (as added by subsection (a) of this section) establishing the portfolio holdings standards under such section.CommentsClose CommentsPermalink
SEC. 116. CORPORATE GOVERNANCE OF ENTERPRISES.
The Housing and Community Development Act of 1992 is amended by inserting before section 1323 (
`SEC. 1322A. CORPORATE GOVERNANCE OF ENTERPRISES.
`(a) Board of Directors-CommentsClose CommentsPermalink
`(1) INDEPENDENCE- A majority of seated members of the board of directors of each enterprise shall be independent board members, as defined under rules set forth by the New York Stock Exchange, as such rules may be amended from time to time.CommentsClose CommentsPermalink
`(2) FREQUENCY OF MEETINGS- To carry out its obligations and duties under applicable laws, rules, regulations, and guidelines, the board of directors of an enterprise shall meet at least eight times a year and not less than once a calendar quarter.CommentsClose CommentsPermalink
`(3) NON-MANAGEMENT BOARD MEMBER MEETINGS- The non-management directors of an enterprise shall meet at regularly scheduled executive sessions without management participation.CommentsClose CommentsPermalink
`(4) QUORUM; PROHIBITION ON PROXIES- For the transaction of business, a quorum of the board of directors of an enterprise shall be at least a majority of the seated board of directors and a board member may not vote by proxy.CommentsClose CommentsPermalink
`(5) INFORMATION- The management of an enterprise shall provide a board member of the enterprise with such adequate and appropriate information that a reasonable board member would find important to the fulfillment of his or her fiduciary duties and obligations.CommentsClose CommentsPermalink
`(6) ANNUAL REVIEW- At least annually, the board of directors of each enterprise shall review, with appropriate professional assistance, the requirements of laws, rules, regulations, and guidelines that are applicable to its activities and duties.CommentsClose CommentsPermalink
`(b) Committees of Boards of Directors-CommentsClose CommentsPermalink
`(1) FREQUENCY OF MEETINGS- Any committee of the board of directors of an enterprise shall meet with sufficient frequency to carry out its obligations and duties under applicable laws, rules, regulations, and guidelines.CommentsClose CommentsPermalink
`(2) REQUIRED COMMITTEES- Each enterprise shall provide for the establishment, however styled, of the following committees of the board of directors:CommentsClose CommentsPermalink
`(A) Audit committee.CommentsClose CommentsPermalink
`(B) Compensation committee.CommentsClose CommentsPermalink
`(C) Nominating/corporate governance committee.CommentsClose CommentsPermalink
Such committees shall be in compliance with the charter, independence, composition, expertise, duties, responsibilities, and other requirements set forth under section 10A(m) of the Securities Exchange Act of 1934 (
`(c) Compensation-CommentsClose CommentsPermalink
`(1) IN GENERAL- The compensation of board members, executive officers, and employees of an enterprise--CommentsClose CommentsPermalink
`(A) shall not be in excess of that which is reasonable and appropriate;CommentsClose CommentsPermalink
`(B) shall be commensurate with the duties and responsibilities of such persons;CommentsClose CommentsPermalink
`(C) shall be consistent with the long-term goals of the enterprise;CommentsClose CommentsPermalink
`(D) shall not focus solely on earnings performance, but shall take into account risk management, operational stability and legal and regulatory compliance as well; andCommentsClose CommentsPermalink
`(E) shall be undertaken in a manner that complies with applicable laws, rules, and regulations.CommentsClose CommentsPermalink
`(2) REIMBURSEMENT- If an enterprise is required to prepare an accounting restatement due to the material noncompliance of the enterprise, as a result of misconduct, with any financial reporting requirement under the securities laws, the chief executive officer and chief financial officer of the enterprise shall reimburse the enterprise as provided under section 304 of the Sarbanes-Oxley Act of 2002 (
`(d) Code of Conduct and Ethics-CommentsClose CommentsPermalink
`(1) IN GENERAL- An enterprise shall establish and administer a written code of conduct and ethics that is reasonably designed to assure the ability of board members, executive officers, and employees of the enterprise to discharge their duties and responsibilities, on behalf of the enterprise, in an objective and impartial manner, and that includes standards required under section 406 of the Sarbanes-Oxley Act of 2002 (
`(2) REVIEW- Not less than once every three years, an enterprise shall review the adequacy of its code of conduct and ethics for consistency with practices appropriate to the enterprise and make any appropriate revisions to such code.CommentsClose CommentsPermalink
`(e) Conduct and Responsibilities of Board of Directors- The board of directors of an enterprise shall be responsible for directing the conduct and affairs of the enterprise in furtherance of the safe and sound operation of the enterprise and shall remain reasonably informed of the condition, activities, and operations of the enterprise. The responsibilities of the board of directors shall include having in place adequate policies and procedures to assure its oversight of, among other matters, the following:CommentsClose CommentsPermalink
`(1) Corporate strategy, major plans of action, risk policy, programs for legal and regulatory compliance and corporate performance, including prudent plans for growth and allocation of adequate resources to manage operations risk.CommentsClose CommentsPermalink
`(2) Hiring and retention of qualified executive officers and succession planning for such executive officers.CommentsClose CommentsPermalink
`(3) Compensation programs of the enterprise.CommentsClose CommentsPermalink
`(4) Integrity of accounting and financial reporting systems of the enterprise, including independent audits and systems of internal control.CommentsClose CommentsPermalink
`(5) Process and adequacy of reporting, disclosures, and communications to shareholders, investors, and potential investors.CommentsClose CommentsPermalink
`(6) Extensions of credit to board members and executive officers.CommentsClose CommentsPermalink
`(7) Responsiveness of executive officers in providing accurate and timely reports to Federal regulators and in addressing the supervisory concerns of Federal regulators in a timely and appropriate manner.CommentsClose CommentsPermalink
`(f) Prohibition of Extensions of Credit- An enterprise may not directly or indirectly, including through any subsidiary, extend or maintain credit, arrange for the extension of credit, or renew an extension of credit, in the form of a personal loan to or for any board member or executive officer of the enterprise, as provided by section 13(k) of the Securities Exchange Act of 1934 (
`(g) Certification of Disclosures- The chief executive officer and the chief financial officer of an enterprise shall review each quarterly report and annual report issued by the enterprise and such reports shall include certifications by such officers as required by section 302 of the Sarbanes-Oxley Act of 2002 (
`(h) Change of Audit Partner- An enterprise may not accept audit services from an external auditing firm if the lead or coordinating audit partner who has primary responsibility for the external audit of the enterprise, or the external audit partner who has responsibility for reviewing the external audit has performed audit services for the enterprise in each of the five previous fiscal years.CommentsClose CommentsPermalink
`(i) Compliance Program-CommentsClose CommentsPermalink
`(1) REQUIREMENT- Each enterprise shall establish and maintain a compliance program that is reasonably designed to assure that the enterprise complies with applicable laws, rules, regulations, and internal controls.CommentsClose CommentsPermalink
`(2) COMPLIANCE OFFICER- The compliance program of an enterprise shall be headed by a compliance officer, however styled, who reports directly to the chief executive officer of the enterprise. The compliance officer shall report regularly to the board of directors or an appropriate committee of the board of directors on compliance with and the adequacy of current compliance policies and procedures of the enterprise, and shall recommend any adjustments to such policies and procedures that the compliance officer considers necessary and appropriate.CommentsClose CommentsPermalink
`(j) Risk Management Program-CommentsClose CommentsPermalink
`(1) REQUIREMENT- Each enterprise shall establish and maintain a risk management program that is reasonably designed to manage the risks of the operations of the enterprise.CommentsClose CommentsPermalink
`(2) RISK MANAGEMENT OFFICER- The risk management program of an enterprise shall be headed by a risk management officer, however styled, who reports directly to the chief executive officer of the enterprise. The risk management officer shall report regularly to the board of directors or an appropriate committee of the board of directors on compliance with and the adequacy of current risk management policies and procedures of the enterprise, and shall recommend any adjustments to such policies and procedures that the risk management officer considers necessary and appropriate.CommentsClose CommentsPermalink
`(k) Compliance With Other Laws-CommentsClose CommentsPermalink
`(1) DEREGISTERED OR UNREGISTERED COMMON STOCK- If an enterprise deregisters or has not registered its common stock with the Securities and Exchange Commission under the Securities Exchange Act of 1934, the enterprise shall comply or continue to comply with sections 10A(m) and 13(k) of the Securities Exchange Act of 1934 (
`(2) REGISTERED COMMON STOCK- An enterprise that has its common stock registered with the Securities and Exchange Commission shall maintain such registered status, unless it provides 60 days prior written notice to the Director stating its intent to deregister and its understanding that it will remain subject to the requirements of the sections of the Securities Exchange Act of 1934 and the Sarbanes-Oxley Act of 2002, subject to such requirements as provided by subsection (l) of this section.CommentsClose CommentsPermalink
`(l) Other Matters- The Director may from time to time establish standards, by regulation, order, or guideline, regarding such other corporate governance matters of the enterprises as the Director considers appropriate.CommentsClose CommentsPermalink
`(m) Modification of Standards- In connection with standards of Federal or State law (including the Revised Model Corporation Act) or New York Stock Exchange rules that are made applicable to an enterprise by section 1710.10 of the Director's rules (12 CFR 1710.10) and by subsections (a), (b), (g), (i), (j), and (k) of this section, the Director, in the Director's sole discretion, may modify the standards contained in this section or in part 1710 of the Director's rules (12 CFR Part 1710) in accordance with
SEC. 117. REQUIRED REGISTRATION UNDER SECURITIES EXCHANGE ACT OF 1934.
The Housing and Community Development Act of 1992 is amended by adding after section 1322A, as added by the preceding provisions of this Act, the following new section:CommentsClose CommentsPermalink
`SEC. 1322B. REQUIRED REGISTRATION UNDER SECURITIES EXCHANGE ACT OF 1934.
`(a) In General- Each regulated entity shall register at least one class of the capital stock of such regulated entity, and maintain such registration with the Securities and Exchange Commission, under the Securities Exchange Act of 1934.CommentsClose CommentsPermalink
`(b) Enterprises- Each enterprise shall comply with sections 14 and 16 of the Securities Exchange Act of 1934.'.CommentsClose CommentsPermalink
SEC. 118. LIAISON WITH FINANCIAL INSTITUTIONS EXAMINATION COUNCIL.
Section 1007 of the Federal Financial Institutions Examination Council Act of 1978 (
(1) in the section heading, by inserting after `STATE' the following: `AND FEDERAL HOUSING FINANCE AGENCY'; andCommentsClose CommentsPermalink
(2) by inserting after `financial institutions' the following: `, and one representative of the Federal Housing Finance Agency,'.CommentsClose CommentsPermalink
SEC. 119. GUARANTEE FEE STUDY.
(a) In General- The Director of the Federal Housing Finance Agency, in consultation with the heads of the federal banking agencies, shall, not later than 18 months after the date of the enactment of this Act, submit to the Congress a study concerning the pricing, transparency and reporting of the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, and the Federal home loan banks with regard to guarantee fees and concerning analogous practices, transparency and reporting requirements (including advances pricing practices by the Federal Home Loan Banks) of other participants in the business of mortgage purchases and securitization.CommentsClose CommentsPermalink
(b) Factors- The study required by this section shall examine various factors such as credit risk, counterparty risk considerations, economic value considerations, and volume considerations used by the regulated entities (as such term is defined in section 1303 of the Housing and Community Development Act of 1992) included in the study in setting the amount of fees they charge.CommentsClose CommentsPermalink
(c) Contents of Report- The report required under subsection (a) shall identify and analyze--CommentsClose CommentsPermalink
(1) the factors used by each enterprise (as such term is defined in section 1303 of the Housing and Community Development Act of 1992) in determining the amount of the guarantee fees it charges;CommentsClose CommentsPermalink
(2) the total revenue the enterprises earn from guarantee fees;CommentsClose CommentsPermalink
(3) the total costs incurred by the enterprises for providing guarantees;CommentsClose CommentsPermalink
(4) the average guarantee fee charged by the enterprises;CommentsClose CommentsPermalink
(5) an analysis of how and why the guarantee fees charged differ from such fees charged during the previous year;CommentsClose CommentsPermalink
(6) a breakdown of the revenue and costs associated with providing guarantees, based on product type and risk classifications; andCommentsClose CommentsPermalink
(7) other relevant information on guarantee fees with other participants in the mortgage and securitization business.CommentsClose CommentsPermalink
(d) Protection of Information- Nothing in this section may be construed to require or authorize the Director of the Federal Housing Finance Agency, in connection with the study mandated by this section, to disclose information of the enterprises or other organization that is confidential or proprietary.CommentsClose CommentsPermalink
(e) Effective Date- This section shall take effect on the date of the enactment of this Act.CommentsClose CommentsPermalink
SEC. 120. CONFORMING AMENDMENTS.
(a) 1992 Act- Part 1 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (
(1) by striking `an enterprise' each place such term appears in such part (except in sections 1313(a)(2)(A), 1313A(b)(2)(B)(ii)(I), and 1316(b)(3)) and inserting `a regulated entity';CommentsClose CommentsPermalink
(2) by striking `the enterprise' each place such term appears in such part (except in section 1316(b)(3)) and inserting `the regulated entity';CommentsClose CommentsPermalink
(3) by striking `the enterprises' each place such term appears in such part (except in sections 1312(c)(2), and 1312(e)(2)) and inserting `the regulated entities';CommentsClose CommentsPermalink
(4) by striking `each enterprise' each place such term appears in such part and inserting `each regulated entity';CommentsClose CommentsPermalink
(5) by striking `Office' each place such term appears in such part (except in sections 1311(b)(2), 1312(b)(5), 1315(b), and 1316(a)(4), (g), and (h), 1317(c), and 1319A(a)) and inserting `Agency';CommentsClose CommentsPermalink
(6) in section 1315 (
(A) in subsection (a)--CommentsClose CommentsPermalink
(i) in the subsection heading, by striking `Office Personnel' and inserting `In General'; andCommentsClose CommentsPermalink
(ii) by striking `The' and inserting `Subject to title III of the Federal Housing Finance Reform Act of 2007, the';CommentsClose CommentsPermalink
(B) by striking subsections (d) and (f); andCommentsClose CommentsPermalink
(C) by redesignating subsection (e) as subsection (d);CommentsClose CommentsPermalink
(7) in section 1319B (
(8) in section 1319F (
(b) Amendments to Fannie Mae Charter Act- The Federal National Mortgage Association Charter Act (
(1) by striking `Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development' each place such term appears, and inserting `Director of the Federal Housing Finance Agency', in--CommentsClose CommentsPermalink
(A) section 303(c)(2) (
(B) section 309(d)(3)(B) (
(C) section 309(k)(1); andCommentsClose CommentsPermalink
(2) in section 309--CommentsClose CommentsPermalink
(A) in subsections (d)(3)(A) and (n)(1), by striking `Banking, Finance and Urban Affairs' each place such term appears and inserting `Financial Services'; andCommentsClose CommentsPermalink
(B) in subsection (m)--CommentsClose CommentsPermalink
(i) in paragraph (1), by striking `Secretary' the second place such term appears and inserting `Director';CommentsClose CommentsPermalink
(ii) in paragraph (2), by striking `Secretary' the second place such term appears and inserting `Director'; andCommentsClose CommentsPermalink
(iii) by striking `Secretary' each other place such term appears and inserting `Director of the Federal Housing Finance Agency'; andCommentsClose CommentsPermalink
(C) in subsection (n), by striking `Secretary' each place such term appears and inserting `Director of the Federal Housing Finance Agency'.CommentsClose CommentsPermalink
(c) Amendments to Freddie Mac Act- The Federal Home Loan Mortgage Corporation Act is amended--CommentsClose CommentsPermalink
(1) by striking `Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development' each place such term appears, and inserting `Director of the Federal Housing Finance Agency', in--CommentsClose CommentsPermalink
(A) section 303(b)(2) (
(B) section 303(h)(2) (
(C) section 307(c)(1) (
(2) in sections 303(h)(1) and 307(f)(1) (
(3) in section 306(i) (
(A) by striking `1316(c)' and inserting `306(c)'; andCommentsClose CommentsPermalink
(B) by striking `section 106' and inserting `section 1316'; andCommentsClose CommentsPermalink
(4) in section 307 (
(A) in subsection (e)--CommentsClose CommentsPermalink
(i) in paragraph (1), by striking `Secretary' the second place such term appears and inserting `Director';CommentsClose CommentsPermalink
(ii) in paragraph (2), by striking `Secretary' the second place such term appears and inserting `Director'; andCommentsClose CommentsPermalink
(iii) by striking `Secretary' each other place such term appears and inserting `Director of the Federal Housing Finance Agency'; andCommentsClose CommentsPermalink
(B) in subsection (f), by striking `Secretary' each place such term appears and inserting `Director of the Federal Housing Finance Agency'.CommentsClose CommentsPermalink
Subtitle B--Improvement of Mission Supervision
SEC. 131. TRANSFER OF PRODUCT APPROVAL AND HOUSING GOAL OVERSIGHT.
Part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (
(1) by striking the designation and heading for the part and inserting the following:CommentsClose CommentsPermalink
`PART 2--PRODUCT APPROVAL BY DIRECTOR, CORPORATE GOVERNANCE, AND ESTABLISHMENT OF HOUSING GOALS';
andCommentsClose CommentsPermalink
(2) by striking sections 1321 and 1322.CommentsClose CommentsPermalink
SEC. 132. REVIEW OF ENTERPRISE PRODUCTS.
(a) In General- Part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 is amended by inserting before section 1323 (
`SEC. 1321. PRIOR APPROVAL AUTHORITY FOR PRODUCTS OF ENTERPRISES.
`(a) In General- The Director shall require each enterprise to obtain the approval of the Director for any product of the enterprise before initially offering the product.CommentsClose CommentsPermalink
`(b) Standard for Approval- In considering any request for approval of a product pursuant to subsection (a), the Director shall make a determination that--CommentsClose CommentsPermalink
`(1) in the case of a product of the Federal National Mortgage Association, the Director determines that the product is authorized under paragraph (2), (3), (4), or (5) of section 302(b) or section 304 of the Federal National Mortgage Association Charter Act, (
`(2) in the case of a product of the Federal Home Loan Mortgage Corporation, the Director determines that the product is authorized under paragraph (1), (4), or (5) of section 305(a) of the Federal Home Loan Mortgage Corporation Act (
`(3) the product is in the public interest;CommentsClose CommentsPermalink
`(4) the product is consistent with the safety and soundness of the enterprise or the mortgage finance system; andCommentsClose CommentsPermalink
`(5) the product does not materially impair the efficiency of the mortgage finance system.CommentsClose CommentsPermalink
`(c) Procedure for Approval-CommentsClose CommentsPermalink
`(1) SUBMISSION OF REQUEST- An enterprise shall submit to the Director a written request for approval of a product that describes the product in such form as prescribed by order or regulation of the Director.CommentsClose CommentsPermalink
`(2) REQUEST FOR PUBLIC COMMENT- Immediately upon receipt of a request for approval of a product, as required under paragraph (1), the Director shall publish notice of such request and of the period for public comment pursuant to paragraph (3) regarding the product, and a description of the product proposed by the request. The Director shall give interested parties the opportunity to respond in writing to the proposed product.CommentsClose CommentsPermalink
`(3) PUBLIC COMMENT PERIOD- During the 30-day period beginning on the date of publication pursuant to paragraph (2) of a request for approval of a product, the Director shall receive public comments regarding the proposed product.CommentsClose CommentsPermalink
`(4) OFFERING OF PRODUCT-CommentsClose CommentsPermalink
`(A) IN GENERAL- Not later than 30 days after the close of the public comment period described in paragraph (3), the Director shall approve or deny the product, specifying the grounds for such decision in writing.CommentsClose CommentsPermalink
`(B) FAILURE TO ACT- If the Director fails to act within the 30-day period described in subparagraph (A), the enterprise may offer the product.CommentsClose CommentsPermalink
`(d) Expedited Review-CommentsClose CommentsPermalink
`(1) DETERMINATION AND NOTICE- If an enterprise determines that any new activity, service, undertaking, or offering is not a product, as defined in subsection (f), the enterprise shall provide written notice to the Director prior to the commencement of such activity, service, undertaking, or offering.CommentsClose CommentsPermalink
`(2) DIRECTOR DETERMINATION OF APPLICABLE PROCEDURE- Immediately upon receipt of any notice pursuant to paragraph (1), the Director shall make a determination under paragraph (3).CommentsClose CommentsPermalink
`(3) DETERMINATION AND TREATMENT AS PRODUCT- If the Director determines that any new activity, service, undertaking, or offering consists of, relates to, or involves a product--CommentsClose CommentsPermalink
`(A) the Director shall notify the enterprise of the determination;CommentsClose CommentsPermalink
`(B) the new activity, service, undertaking, or offering described in the notice under paragraph (1) shall be considered a product for purposes of this section; andCommentsClose CommentsPermalink
`(C) the enterprise shall withdraw its request or submit a written request for approval of the product pursuant to subsection (c).CommentsClose CommentsPermalink
`(e) Conditional Approval- The Director may conditionally approve the offering of any product by an enterprise, and may establish terms, conditions, or limitations with respect to such product with which the enterprise must comply in order to offer such product.CommentsClose CommentsPermalink
`(f) Definition of Product- For purposes of this section, the term `product' does not include--CommentsClose CommentsPermalink
`(1) the automated loan underwriting system of an enterprise in existence as of the date of the enactment of the Federal Housing Finance Reform Act of 2007, including any upgrade to the technology, operating system, or software to operate the underwriting system; orCommentsClose CommentsPermalink
`(2) any modification to the mortgage terms and conditions or mortgage underwriting criteria relating to the mortgages that are purchased or guaranteed by an enterprise: Provided, That such modifications do not alter the underlying transaction so as to include services or financing, other than residential mortgage financing, or create significant new exposure to risk for the enterprise or the holder of the mortgage.CommentsClose CommentsPermalink
`(g) No Limitation- Nothing in this section shall be deemed to restrict--CommentsClose CommentsPermalink
`(1) the safety and soundness authority of the Director over all new and existing products or activities; orCommentsClose CommentsPermalink
`(2) the authority of the Director to review all new and existing products or activities to determine that such products or activities are consistent with the statutory mission of the enterprise.'.CommentsClose CommentsPermalink
(b) Conforming Amendments-CommentsClose CommentsPermalink
(1) FANNIE MAE- Section 302(b)(6) of the Federal National Mortgage Association Charter Act (
(A) by striking `implement any new program' and inserting `initially offer any product';CommentsClose CommentsPermalink
(B) by striking `section 1303' and inserting `section 1321(f)'; andCommentsClose CommentsPermalink
(C) by striking `before obtaining the approval of the Secretary under section 1322' and inserting `except in accordance with section 1321'.CommentsClose CommentsPermalink
(2) FREDDIE MAC- Section 305(c) of the Federal Home Loan Mortgage Corporation Act (
(A) by striking `implement any new program' and inserting `initially offer any product';CommentsClose CommentsPermalink
(B) by striking `section 1303' and inserting `section 1321(f)'; andCommentsClose CommentsPermalink
(C) by striking `before obtaining the approval of the Secretary under section 1322' and inserting `except in accordance with section 1321'.CommentsClose CommentsPermalink
(3) 1992 ACT- Section 1303 of the Housing and Community Development Act of 1992 (
(A) by striking paragraph (17) (relating to the definition of `new program'); andCommentsClose CommentsPermalink
(B) by redesignating paragraphs (18) through (23) as paragraphs (17) through (22), respectively.CommentsClose CommentsPermalink
SEC. 133. CONFORMING LOAN LIMITS.
(a) Fannie Mae-CommentsClose CommentsPermalink
(1) GENERAL LIMIT- Section 302(b)(2) of the Federal National Mortgage Association Charter Act (
(A) in the 4th sentence, by striking `the Resolution Trust Corporation,'; andCommentsClose CommentsPermalink
(B) by striking the 7th and 8th sentences and inserting the following new sentences: `For 2007, such limitations shall not exceed $417,000 for a mortgage secured by a single-family residence, $533,850 for a mortgage secured by a 2-family residence, $645,300 for a mortgage secured by a 3-family residence, and $801,950 for a mortgage secured by a 4-family residence, except that such maximum limitations shall be adjusted effective January 1 of each year beginning with 2008, subject to the limitations in this paragraph. Each adjustment shall be made by adding to or subtracting from each such amount (as it may have been previously adjusted) a percentage thereof equal to the percentage increase or decrease, during the most recent 12-month or four-quarter period ending before the time of determining such annual adjustment, in the housing price index maintained by the Director of the Federal Housing Finance Agency (pursuant to section 1322 of the Housing and Community Development Act of 1992 (
(2) HIGH-COST AREA LIMIT- Section 302(b)(2) of the Federal National Mortgage Association Charter Act is (
(b) Freddie Mac-CommentsClose CommentsPermalink
(1) GENERAL LIMIT- Section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act (
(A) in the 3rd sentence, by striking `the Resolution Trust Corporation,'; andCommentsClose CommentsPermalink
(B) by striking the 6th and 7th sentences and inserting the following new sentences: `For 2007, such limitations shall not exceed $417,000 for a mortgage secured by a single-family residence, $533,850 for a mortgage secured by a 2-family residence, $645,300 for a mortgage secured by a 3-family residence, and $801,950 for a mortgage secured by a 4-family residence, except that such maximum limitations shall be adjusted effective January 1 of each year beginning with 2008, subject to the limitations in this paragraph. Each adjustment shall be made by adding to or subtracting from each such amount (as it may have been previously adjusted) a percentage thereof equal to the percentage increase or decrease, during the most recent 12-month or four-quarter period ending before the time of determining such annual adjustment, in the housing price index maintained by the Director of the Federal Housing Finance Agency (pursuant to section 1322 of the Housing and Community Development Act of 1992 (
(2) HIGH-COST AREA LIMIT- Section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act is amended by adding after the period at the end the following: `Such foregoing limitations shall also be increased with respect to properties of a particular size located in any area for which the median price for such size residence exceeds the foregoing limitation for such size residence, to the lesser of 150 percent of such foregoing limitation for such size residence or the amount that is equal to the median price in such area for such size residence, except that, subject to the order, if any, issued by the Director of the Federal Housing Finance Agency pursuant to section 133(d)(3) of the Federal Housing Finance Reform Act of 2007, such increase shall apply only with respect to mortgages on which are based securities issued and sold by the Corporation.'.CommentsClose CommentsPermalink
(c) Housing Price Index- Subpart A of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (as amended by the preceding provisions of this Act) is amended by inserting after section 1321 (as added by section 132 of this Act) the following new section:CommentsClose CommentsPermalink
`SEC. 1322. HOUSING PRICE INDEX.
`(a) In General- The Director shall establish and maintain a method of assessing the national average 1-family house price for use for adjusting the conforming loan limitations of the enterprises. In establishing such method, the Director shall take into consideration the monthly survey of all major lenders conducted by the Federal Housing Finance Agency to determine the national average 1-family house price, the House Price Index maintained by the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development before the effective date under section 185 of the Federal Housing Finance Reform Act of 2007, any appropriate house price indexes of the Bureau of the Census of the Department of Commerce, and any other indexes or measures that the Director considers appropriate.CommentsClose CommentsPermalink
`(b) GAO Audit-CommentsClose CommentsPermalink
`(1) IN GENERAL- At such times as are required under paragraph (2), the Comptroller General of the United States shall conduct an audit of the methodology established by the Director under subsection (a) to determine whether the methodology established is an accurate and appropriate means of measuring changes to the national average 1-family house price.CommentsClose CommentsPermalink
`(2) TIMING- An audit referred to in paragraph (1) shall be conducted and completed not later than the expiration of the 180-day period that begins upon each of the following dates:CommentsClose CommentsPermalink
`(A) ESTABLISHMENT- The date upon which such methodology is initially established under subsection (a) in final form by the Director.CommentsClose CommentsPermalink
`(B) MODIFICATION OR AMENDMENT- Each date upon which any modification or amendment to such methodology is adopted in final form by the Director.CommentsClose CommentsPermalink
`(3) REPORT- Within 30 days of the completion of any audit conducted under this subsection, the Comptroller General shall submit a report detailing the results and conclusions of the audit to the Director, the Committee on Financial Services of the House of Representatives, and the Committee on Banking, Housing, and Urban Affairs of the Senate.'.CommentsClose CommentsPermalink
(d) Conditions on Conforming Loan Limit for High-Cost Areas-CommentsClose CommentsPermalink
(1) STUDY- The Director of the Federal Housing Finance Agency shall conduct a study under this subsection during the six-month period beginning on the effective date under section 185 of this Act.CommentsClose CommentsPermalink
(2) ISSUES- The study under this subsection shall determine--CommentsClose CommentsPermalink
(A) the effect that restricting the conforming loan limits for high-cost areas only to mortgages on which are based securities issued and sold by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation (as provided in the last sentence of section 302(b)(2) of the Federal National Mortgage Association Charter Act and the last sentence of section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act, pursuant to the amendments made by subsections (a)(2) and (b)(2) of this section) would have on the cost to borrowers for mortgages on housing in such high-cost areas;CommentsClose CommentsPermalink
(B) the effects that such restrictions would have on the availability of mortgages for housing in such high-cost areas; andCommentsClose CommentsPermalink
(C) the extent to which the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation will be able to issue and sell securities based on mortgages for housing located in such high-cost areas.CommentsClose CommentsPermalink
(3) DETERMINATION-CommentsClose CommentsPermalink
(A) IN GENERAL- Not later than the expiration of the six-month period specified in paragraph (1), the Director of the Federal Housing Finance Agency shall make a determination, based on the results of the study under this subsection, of whether the restriction of conforming loan limits for high-cost areas only to mortgages on which are based securities issued and sold by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation (as provided in the amendments made by subsections (a)(2) and (b)(2) of this section) will result in an increase in the cost to borrowers for mortgages on housing in such high-cost areas.CommentsClose CommentsPermalink
(B) ORDER- If such determination is that costs to borrowers on housing in such high-cost areas will be increased by such restrictions, the Director may issue an order terminating such restrictions, in whole or in part.CommentsClose CommentsPermalink
(4) PUBLICATION- Not later than the expiration of the six-month period specified in paragraph (1), the Director of the Federal Housing Finance Agency shall cause to be published in the Federal Register--CommentsClose CommentsPermalink
(A) a report that--CommentsClose CommentsPermalink
(i) describes the study under this subsection; andCommentsClose CommentsPermalink
(ii) sets forth the conclusions of the study regarding the issues to be determined under paragraph (2); andCommentsClose CommentsPermalink
(B) notice of the determination of the Director under paragraph (3); andCommentsClose CommentsPermalink
(C) the order of the Director under paragraph (3).CommentsClose CommentsPermalink
(5) DEFINITION- For purposes of this subsection, the term `conforming loan limits for high-cost areas' means the dollar amount limitations applicable under the section 302(b)(2) of the Federal National Mortgage Association Charter Act and section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act (as amended by subsections (a) and (b) of this section) for areas described in the last sentence of such sections (as so amended).CommentsClose CommentsPermalink
SEC. 134. ANNUAL HOUSING REPORT REGARDING REGULATED ENTITIES.
(a) In General- The Housing and Community Development Act of 1992 is amended by striking section 1324 (
`SEC. 1324. ANNUAL HOUSING REPORT REGARDING REGULATED ENTITIES.
`(a) In General- After reviewing and analyzing the reports submitted under section 309(n) of the Federal National Mortgage Association Charter Act, section 307(f) of the Federal Home Loan Mortgage Corporation Act, and section 10(j)(11) of the Federal Home Loan Bank Act (
`(b) Contents- The report shall--CommentsClose CommentsPermalink
`(1) discuss the extent to which--CommentsClose CommentsPermalink
`(A) each enterprise is achieving the annual housing goals established under subpart B of this part;CommentsClose CommentsPermalink
`(B) each enterprise is complying with section 1337;CommentsClose CommentsPermalink
`(C) each Federal home loan bank is complying with section 10(j) of the Federal Home Loan Bank Act; andCommentsClose CommentsPermalink
`(D) each regulated entity is achieving the purposes of the regulated entity established by law;CommentsClose CommentsPermalink
`(2) aggregate and analyze relevant data on income to assess the compliance by each enterprise with the housing goals established under subpart B;CommentsClose CommentsPermalink
`(3) aggregate and analyze data on income, race, and gender by census tract and other relevant classifications, and compare such data with larger demographic, housing, and economic trends;CommentsClose CommentsPermalink
`(4) examine actions that--CommentsClose CommentsPermalink
`(A) each enterprise has undertaken or could undertake to promote and expand the annual goals established under subpart B and the purposes of the enterprise established by law; andCommentsClose CommentsPermalink
`(B) each Federal home loan bank has taken or could undertake to promote and expand the community investment program and affordable housing program of the bank established under section subsections (i) and (j) of section 10 of the Federal Home Loan Bank Act;CommentsClose CommentsPermalink
`(5) examine the primary and secondary multifamily housing mortgage markets and describe--CommentsClose CommentsPermalink
`(A) the availability and liquidity of mortgage credit;CommentsClose CommentsPermalink
`(B) the status of efforts to provide standard credit terms and underwriting guidelines for multifamily housing and to securitize such mortgage products; andCommentsClose CommentsPermalink
`(C) any factors inhibiting such standardization and securitization;CommentsClose CommentsPermalink
`(6) examine actions each regulated entity has undertaken and could undertake to promote and expand opportunities for first-time homebuyers, including the use of alternative credit scoring;CommentsClose CommentsPermalink
`(7) describe any actions taken under section 1325(5) with respect to originators found to violate fair lending procedures;CommentsClose CommentsPermalink
`(8) discuss and analyze existing conditions and trends, including conditions and trends relating to pricing, in the housing markets and mortgage markets; andCommentsClose CommentsPermalink
`(9) identify the extent to which each enterprise is involved in mortgage purchases and secondary market activities involving subprime loans (as identified in accordance with the regulations issued pursuant to section 134(b) of the Federal Housing Finance Reform Act of 2007) and compare the characteristics of subprime loans purchased and securitized by the enterprises to other loans purchased and securitized by the enterprises.CommentsClose CommentsPermalink
`(c) Data Collection and Reporting-CommentsClose CommentsPermalink
`(1) IN GENERAL- To assist the Director in analyzing the matters described in subsection (b) and establishing the methodology described in section 1322, the Director shall conduct, on a monthly basis, a survey of mortgage markets in accordance with this subsection.CommentsClose CommentsPermalink
`(2) DATA POINTS- Each monthly survey conducted by the Director under paragraph (1) shall collect data on--CommentsClose CommentsPermalink
`(A) the characteristics of individual mortgages that are eligible for purchase by the enterprises and the characteristics of individual mortgages that are not eligible for purchase by the enterprises including, in both cases, information concerning--CommentsClose CommentsPermalink
`(i) the price of the house that secures the mortgage;CommentsClose CommentsPermalink
`(ii) the loan-to-value ratio of the mortgage, which shall reflect any secondary liens on the relevant property;CommentsClose CommentsPermalink
`(iii) the terms of the mortgage;CommentsClose CommentsPermalink
`(iv) the creditworthiness of the borrower or borrowers; andCommentsClose CommentsPermalink
`(v) whether the mortgage, in the case of a conforming mortgage, was purchased by an enterprise; andCommentsClose CommentsPermalink
`(B) such other matters as the Director determines to be appropriate.CommentsClose CommentsPermalink
`(3) PUBLIC AVAILABILITY- The Director shall make any data collected by the Director in connection with the conduct of a monthly survey available to the public in a timely manner, provided that the Director may modify the data released to the public to ensure that the data is not released in an identifiable form.CommentsClose CommentsPermalink
`(4) DEFINITION- For purposes of this subsection, the term `identifiable form' means any representation of information that permits the identity of a borrower to which the information relates to be reasonably inferred by either direct or indirect means.'.CommentsClose CommentsPermalink
(b) Standards for Subprime Loans- The Director shall, not later than one year after the effective date under section 185, by regulations issued under section 1316G of the Housing and Community Development Act of 1992, establish standards by which mortgages purchased and mortgages purchased and securitized shall be characterized as subprime for the purpose of, and only for the purpose of, complying with the reporting requirement under section 1324(b)(9) of such Act.CommentsClose CommentsPermalink
SEC. 135. ANNUAL REPORTS BY REGULATED ENTITIES ON AFFORDABLE HOUSING STOCK.
The Housing and Community Development Act of 1992 is amended by inserting after section 1328 (
`SEC. 1329. ANNUAL REPORTS ON AFFORDABLE HOUSING STOCK.
`(a) In General- To obtain information helpful in applying the formula under section 1337(c)(2) for the affordable housing program under such section and for other appropriate uses, the regulated entities shall conduct, or provide for the conducting of, a study on an annual basis to determine the levels of affordable housing inventory, and the changes in such levels, in communities throughout the United States.CommentsClose CommentsPermalink
`(b) Contents- The annual study under this section shall determine, for the United States, each State, and each community within each State--CommentsClose CommentsPermalink
`(1) the level of affordable housing inventory, including affordable rental dwelling units and affordable homeownership dwelling units;CommentsClose CommentsPermalink
`(2) any changes to the level of such inventory during the 12-month period of the study under this section, including--CommentsClose CommentsPermalink
`(A) any additions to such inventory, disaggregated by the category of such additions (including new construction or housing conversion);CommentsClose CommentsPermalink
`(B) any subtractions from such inventory, disaggregated by the category of such subtractions (including abandonment, demolition, or upgrade to market-rate housing);CommentsClose CommentsPermalink
`(C) the number of new affordable dwelling units placed in service; andCommentsClose CommentsPermalink
`(D) the number of affordable housing dwelling units withdrawn from service;CommentsClose CommentsPermalink
`(3) the types of financing used to build any dwelling units added to such inventory level and the period during which such units are required to remain affordable;CommentsClose CommentsPermalink
`(4) any excess demand for affordable housing, including the number of households on rental housing waiting lists and the tenure of the wait on such lists; andCommentsClose CommentsPermalink
`(5) such other information as the Director may require.CommentsClose CommentsPermalink
`(c) Report- For each annual study conducted pursuant to this section, the regulated entities shall submit to the Congress, and make publicly available, a report setting forth the findings of the study.CommentsClose CommentsPermalink
`(d) Regulations and Timing- The Director shall, by regulation, establish requirements for the studies and reports under this section, including deadlines for the submission of such annual reports and standards for determining affordable housing.'.CommentsClose CommentsPermalink
SEC. 136. MORTGAGOR IDENTIFICATION REQUIREMENTS FOR MORTGAGES OF REGULATED ENTITIES.
(a) In General- Subpart A of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (
`SEC. 1330. MORTGAGOR IDENTIFICATION REQUIREMENTS FOR MORTGAGES OF REGULATED ENTITIES.
`(a) Limitation- The Director shall by regulation establish standards, and shall enforce compliance with such standards, that--CommentsClose CommentsPermalink
`(1) prohibit the enterprises from the purchase, service, holding, selling, lending on the security of, or otherwise dealing with any mortgage on a one- to four-family residence that will be used as the principal residence of the mortgagor that does not meet the requirements under subsection (b); andCommentsClose CommentsPermalink
`(2) prohibit the Federal home loan banks from providing any advances to a member for use in financing, and from accepting as collateral for any advance to a member, any mortgage on a one- to four-family residence that will be used as the principal residence of the mortgagor that does not meet the requirements under subsection (b).CommentsClose CommentsPermalink
`(b) Identification Requirements- The requirements under this subsection with respect to a mortgage are that the mortgagor have, at the time of settlement on the mortgage, a Social Security account number.'.CommentsClose CommentsPermalink
(b) Fannie Mae- Section 304 of the Federal National Mortgage Association Charter Act (
`(g) Prohibition Regarding Mortgagor Identification Requirement- Nothing in this Act may be construed to authorize the corporation to purchase, service, hold, sell, lend on the security of, or otherwise deal with any mortgage that the corporation is prohibited from so dealing with under the standards issued under section 1330 of the Housing and Community Development Act of 1992 by the Director of the Federal Housing Finance Agency.'.CommentsClose CommentsPermalink
(c) Freddie Mac- Section 305 of the Federal Home Loan Mortgage Corporation Act (
`(d) Prohibition Regarding Mortgagor Identification Requirements- Nothing in this Act may be construed to authorize the Corporation to purchase, service, hold, sell, lend on the security of, or otherwise deal with any mortgage that the Corporation is prohibited from so dealing with under the standards issued under section 1330 of the Housing and Community Development Act of 1992 by the Director of the Federal Housing Finance Agency.'.CommentsClose CommentsPermalink
(d) Federal Home Loan Banks- Section 10(a) of the Federal Home Loan Bank Act (
(1) by redesignating paragraph (6) as paragraph (7); andCommentsClose CommentsPermalink
(2) by inserting after paragraph (5) the following new paragraph:CommentsClose CommentsPermalink
`(6) PROHIBITION REGARDING MORTGAGOR IDENTIFICATION REQUIREMENTS- Nothing in this Act may be construed to authorize a Federal Home Loan Bank to provide any advance to a member for use in financing, or accept as collateral for an advance under this section, any mortgage that a Bank is prohibited from so accepting under the standards issued under section 1330 of the Housing and Community Development Act of 1992 by the Director of the Federal Housing Finance Agency.'.CommentsClose CommentsPermalink
SEC. 137. REVISION OF HOUSING GOALS.
(a) Housing Goals- The Housing and Community Development Act of 1992 is amended by striking sections 1331 through 1334 (
`SEC. 1331. ESTABLISHMENT OF HOUSING GOALS.
`(a) In General- The Director shall establish, effective for the first year that begins after the effective date under section 185 of the Federal Housing Finance Reform Act of 2007 and each year thereafter, annual housing goals, with respect to the mortgage purchases by the enterprises, as follows:CommentsClose CommentsPermalink
`(1) SINGLE FAMILY HOUSING GOALS- Three single-family housing goals under section 1332.CommentsClose CommentsPermalink
`(2) MULTIFAMILY SPECIAL AFFORDABLE HOUSING GOALS- A multifamily special affordable housing goal under section 1333.CommentsClose CommentsPermalink
`(b) Eliminating Interest Rate Disparities-CommentsClose CommentsPermalink
`(1) IN GENERAL- Upon request by the Director, an enterprise shall provide to the Director, in a form determined by the Director, data the Director may review to determine whether there exist disparities in interest rates charged on mortgages to borrowers who are minorities as compared with comparable mortgages to borrowers of similar creditworthiness who are not minorities.CommentsClose CommentsPermalink
`(2) REMEDIAL ACTIONS UPON PRELIMINARY FINDING- Upon a preliminary finding by the Director that a pattern of disparities in interest rates with respect to any lender or lenders exists pursuant to the data provided by an enterprise in paragraph (1), the Director shall--CommentsClose CommentsPermalink
`(A) refer the preliminary finding to the appropriate regulatory or enforcement agency for further review;CommentsClose CommentsPermalink
`(B) require the enterprise to submit additional data with respect to any lender or lenders, as appropriate and to the extent practicable, to the Director who shall submit any such additional data to the regulatory or enforcement agency for appropriate action; andCommentsClose CommentsPermalink
`(C) require the enterprise to undertake remedial actions, as appropriate, pursuant to section 1325(5) (
`(3) ANNUAL REPORT TO CONGRESS- The Director shall submit to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate a report describing the actions taken, and being taken, by the Director to carry out this subsection. No such report shall identify any lender or lenders who have not been found to have engaged in discriminatory lending practices pursuant to a final adjudication on the record, and after opportunity for an administrative hearing, in accordance with subchapter II of chapter 5 of title 5, United States Code.CommentsClose CommentsPermalink
`(4) PROTECTION OF IDENTITY OF INDIVIDUALS- In carrying out this subsection, the Director shall ensure that no property-related or financial information that would enable a borrower to be identified shall be made public.CommentsClose CommentsPermalink
`(c) Timing- The Director shall establish an annual deadline by which the Director shall establish the annual housing goals under this subpart for each year, taking into consideration the need for the enterprises to reasonably and sufficiently plan their operations and activities in advance, including operations and activities necessary to meet such annual goals.CommentsClose CommentsPermalink
`SEC. 1332. SINGLE-FAMILY HOUSING GOALS.
`(a) In General- The Director shall establish annual goals for the purchase by each enterprise of conventional, conforming, single-family, purchase money mortgages financing owner-occupied and rental housing for each of the following categories of families:CommentsClose CommentsPermalink
`(1) Low-income families.CommentsClose CommentsPermalink
`(2) Families that reside in low-income areas.CommentsClose CommentsPermalink
`(3) Very low-income families.CommentsClose CommentsPermalink
`(b) Refinance Subgoal-CommentsClose CommentsPermalink
`(1) IN GENERAL- The Director shall establish a separate subgoal within each goal under subsection (a)(1) for the purchase by each enterprise of mortgages for low-income families on single family housing given to pay off or prepay an existing loan secured by the same property. The Director shall, for each year, determine whether each enterprise has complied with the subgoal under this subsection in the same manner provided under this section for determining compliance with the housing goals.CommentsClose CommentsPermalink
`(2) ENFORCEMENT- For purposes of section 1336, the subgoal established under paragraph (1) of this subsection shall be considered to be a housing goal established under this section. Such subgoal shall not be enforceable under any other provision of this title (including subpart C of this part) other than section 1336 or under any provision of the Federal National Mortgage Association Charter Act or the Federal Home Loan Mortgage Corporation Act.CommentsClose CommentsPermalink
`(c) Determination of Compliance- The Director shall determine, for each year that the housing goals under this section are in effect pursuant to section 1331(a), whether each enterprise has complied with the single-family housing goals established under this section for such year. An enterprise shall be considered to be in compliance with such a goal for a year only if, for each of the types of families described in subsection (a), the percentage of the number of conventional, conforming, single-family, owner-occupied or rental, as applicable, purchase money mortgages purchased by each enterprise in such year that serve such families, meets or exceeds the target for the year for such type of family that is established under subsection (d).CommentsClose CommentsPermalink
`(d) Annual Targets-CommentsClose CommentsPermalink
`(1) IN GENERAL- Except as provided in paragraph (2), for each of the types of families described in subsection (a), the target under this subsection for a year shall be the average percentage, for the three years that most recently precede such year and for which information under the Home Mortgage Disclosure Act of 1975 is publicly available, of the number of conventional, conforming, single-family, owner-occupied or rental, as applicable, purchase money mortgages originated in such year that serves such type of family, as determined by the Director using the information obtained and determined pursuant to paragraphs (3) and (4).CommentsClose CommentsPermalink
`(2) AUTHORITY TO INCREASE TARGETS-CommentsClose CommentsPermalink
`(A) IN GENERAL- The Director may, for any year, establish by regulation, for any or all of the types of families described in subsection (a), percentage targets that are higher than the percentages for such year determined pursuant to paragraph (1), to reflect expected changes in market performance related to such information under the Home Mortgage Disclosure Act of 1975.CommentsClose CommentsPermalink
`(B) FACTORS- In establishing any targets pursuant to subparagraph (A), the Director shall consider the following factors:CommentsClose CommentsPermalink
`(i) National housing needs.CommentsClose CommentsPermalink
`(ii) Economic, housing, and demographic conditions.CommentsClose CommentsPermalink
`(iii) The performance and effort of the enterprises toward achieving the housing goals under this section in previous years.CommentsClose CommentsPermalink
`(iv) The size of the conventional mortgage market serving each of the types of families described in subsection (a) relative to the size of the overall conventional mortgage market.CommentsClose CommentsPermalink
`(v) The ability of the enterprise to lead the industry in making mortgage credit available.CommentsClose CommentsPermalink
`(vi) The need to maintain the sound financial condition of the enterprises.CommentsClose CommentsPermalink
`(3) HMDA INFORMATION- The Director shall annually obtain information submitted in compliance with the Home Mortgage Disclosure Act of 1975 regarding conventional, conforming, single-family, owner-occupied or rental, as applicable, purchase money mortgages originated and purchased for the previous year.CommentsClose CommentsPermalink
`(4) CONFORMING MORTGAGES- In determining whether a mortgage is a conforming mortgage for purposes of this paragraph, the Director shall consider the original principal balance of the mortgage loan to be the principal balance as reported in the information referred to in paragraph (3), as rounded to the nearest thousand dollars.CommentsClose CommentsPermalink
`(e) Notice of Determination and Enterprise Comment-CommentsClose CommentsPermalink
`(1) NOTICE- Within 30 days of making a determination under subsection (c) regarding a compliance of an enterprise for a year with a housing goal established under this section and before any public disclosure thereof, the Director shall provide notice of the determination to the enterprise, which shall include an analysis and comparison, by the Director, of the performance of the enterprise for the year and the targets for the year under subsection (d).CommentsClose CommentsPermalink
`(2) COMMENT PERIOD- The Director shall provide each enterprise an opportunity to comment on the determination during the 30-day period beginning upon receipt by the enterprise of the notice.CommentsClose CommentsPermalink
`(f) Use of Borrower Income- In monitoring the performance of each enterprise pursuant to the housing goals under this section and evaluating such performance (for purposes of section 1336), the Director shall consider a mortgagor's income to be such income at the time of origination of the mortgage.CommentsClose CommentsPermalink
`(g) Consideration of Units in Single-Family Rental Housing- In establishing any goal under this subpart, the Director may take into consideration the number of housing units financed by any mortgage on single-family rental housing purchased by an enterprise.CommentsClose CommentsPermalink
`SEC. 1333. MULTIFAMILY SPECIAL AFFORDABLE HOUSING GOAL.
`(a) Establishment-CommentsClose CommentsPermalink
`(1) IN GENERAL- The Director shall establish, by regulation, an annual goal for the purchase by each enterprise of each of the following types of mortgages on multifamily housing:CommentsClose CommentsPermalink
`(A) Mortgages that finance dwelling units for low-income families.CommentsClose CommentsPermalink
`(B) Mortgages that finance dwelling units for very low-income families.CommentsClose CommentsPermalink
`(C) Mortgages that finance dwelling units assisted by the low-income housing tax credit under section 42 of the Internal Revenue Code of 1986.CommentsClose CommentsPermalink
`(2) ADDITIONAL REQUIREMENTS FOR SMALLER PROJECTS- The Director shall establish, within the goal under this section, additional requirements for the purchase by each enterprise of mortgages described in paragraph (1) for multifamily housing projects of a smaller or limited size, which may be based on the number of dwelling units in the project or the amount of the mortgage, or both, and shall include multifamily housing projects of such smaller sizes as are typical among such projects that serve rural areas.CommentsClose CommentsPermalink
`(3) FACTORS- In establishing the goal under this section relating to mortgages on multifamily housing for an enterprise for a year, the Director shall consider--CommentsClose CommentsPermalink
`(A) national multifamily mortgage credit needs;CommentsClose CommentsPermalink
`(B) the performance and effort of the enterprise in making mortgage credit available for multifamily housing in previous years;CommentsClose CommentsPermalink
`(C) the size of the multifamily mortgage market;CommentsClose CommentsPermalink
`(D) the ability of the enterprise to lead the industry in making mortgage credit available, especially for underserved markets, such as for small multifamily projects of 5 to 50 units, multifamily properties in need of rehabilitation, and multifamily properties located in rural areas; andCommentsClose CommentsPermalink
`(E) the need to maintain the sound financial condition of the enterprise.CommentsClose CommentsPermalink
`(b) Units Financed by Housing Finance Agency Bonds- The Director shall give credit toward the achievement of the multifamily special affordable housing goal under this section (for purposes of section 1336) to dwelling units in multifamily housing that otherwise qualifies under such goal and that is financed by tax-exempt or taxable bonds issued by a State or local housing finance agency, but only if such bonds--CommentsClose CommentsPermalink
`(1) are secured by a guarantee of the enterprise; orCommentsClose CommentsPermalink
`(2) are not investment grade and are purchased by the enterprise.CommentsClose CommentsPermalink
`(c) Use of Tenant Income or Rent- The Director shall monitor the performance of each enterprise in meeting the goals established under this section and shall evaluate such performance (for purposes of section 1336) based on--CommentsClose CommentsPermalink
`(1) the income of the prospective or actual tenants of the property, where such data are available; orCommentsClose CommentsPermalink
`(2) where the data referred to in paragraph (1) are not available, rent levels affordable to low-income and very low-income families.CommentsClose CommentsPermalink
A rent level shall be considered to be affordable for purposes of this subsection for an income category referred to in this subsection if it does not exceed 30 percent of the maximum income level of such income category, with appropriate adjustments for unit size as measured by the number of bedrooms.CommentsClose CommentsPermalink
`(d) Determination of Compliance- The Director shall, for each year that the housing goal under this section is in effect pursuant to section 1331(a), determine whether each enterprise has complied with such goal and the additional requirements under subsection (a)(2).CommentsClose CommentsPermalink
`SEC. 1334. DISCRETIONARY ADJUSTMENT OF HOUSING GOALS.
`(a) Authority- An enterprise may petition the Director in writing at any time during a year to reduce the level of any goal for such year established pursuant to this subpart.CommentsClose CommentsPermalink
`(b) Standard for Reduction- The Director may reduce the level for a goal pursuant to such a petition only if--CommentsClose CommentsPermalink
`(1) market and economic conditions or the financial condition of the enterprise require such action; orCommentsClose CommentsPermalink
`(2) efforts to meet the goal would result in the constraint of liquidity, over-investment in certain market segments, or other consequences contrary to the intent of this subpart, or section 301(3) of the Federal National Mortgage Association Charter Act (
`(c) Determination- The Director shall make a determination regarding any proposed reduction within 30 days of receipt of the petition regarding the reduction. The Director may extend such period for a single additional 15-day period, but only if the Director requests additional information from the enterprise. A denial by the Director to reduce the level of any goal under this section may be appealed to the United States District Court for the District of Columbia or the United States district court in the jurisdiction in which the headquarters of an enterprise is located.'.CommentsClose CommentsPermalink
(b) Conforming Amendments- The Housing and Community Development Act of 1992 is amended--CommentsClose CommentsPermalink
(1) in section 1335(a) (
(2) in section 1336(a)(1) (
(c) Definitions- Section 1303 of the Housing and Community Development Act of 1992 (
(1) in paragraph (22) (relating to the definition of `very low-income'), by striking `60 percent' each place such term appears and inserting `50 percent';CommentsClose CommentsPermalink
(2) by redesignating paragraphs (19) through (22) as paragraphs (23) through (26), respectively;CommentsClose CommentsPermalink
(3) by inserting after paragraph (18) the following new paragraph:CommentsClose CommentsPermalink
`(22) RURAL AREA- The term `rural area' has the meaning given such term in section 520 of the Housing Act of 1949 (
(4) by redesignating paragraphs (13) through (18) as paragraphs (16) through (21), respectively;CommentsClose CommentsPermalink
(5) by inserting after paragraph (12) the following new paragraph:CommentsClose CommentsPermalink
`(15) LOW-INCOME AREA- The term `low income area' means a census tract or block numbering area in which the median income does not exceed 80 percent of the median income for the area in which such census tract or block numbering area is located, and, for the purposes of section 1332(a)(2), shall include families having incomes not greater than 100 percent of the area median income who reside in minority census tracts.';CommentsClose CommentsPermalink
(6) by redesignating paragraphs (11) and (12) as paragraphs (13) and (14), respectively;CommentsClose CommentsPermalink
(7) by inserting after paragraph (10) the following new paragraph:CommentsClose CommentsPermalink
`(12) EXTREMELY LOW-INCOME- The term `extremely low-income' means--CommentsClose CommentsPermalink
`(A) in the case of owner-occupied units, income not in excess of 30 percent of the area median income; andCommentsClose CommentsPermalink
`(B) in the case of rental units, income not in excess of 30 percent of the area median income, with adjustments for smaller and larger families, as determined by the Secretary.';CommentsClose CommentsPermalink
(8) by redesignating paragraphs (7) through (10) as paragraphs (8) through (11), respectively; andCommentsClose CommentsPermalink
(9) by inserting after paragraph (6) the following new paragraph:CommentsClose CommentsPermalink
`(7) CONFORMING MORTGAGE- The term `conforming mortgage' means, with respect to an enterprise, a conventional mortgage having an original principal obligation that does not exceed the dollar limitation, in effect at the time of such origination, under, as applicable--CommentsClose CommentsPermalink
`(A) section 302(b)(2) of the Federal National Mortgage Association Charter Act; orCommentsClose CommentsPermalink
`(B) section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act.'.CommentsClose CommentsPermalink
SEC. 138. DUTY TO SERVE UNDERSERVED MARKETS.
(a) Establishment and Evaluation of Performance- Section 1335 of the Housing and Community Development Act of 1992 (
(1) in the section heading, by inserting `duty to serve underserved markets and' before `other';CommentsClose CommentsPermalink
(2) by striking subsection (b);CommentsClose CommentsPermalink
(3) in subsection (a)--CommentsClose CommentsPermalink
(A) in the matter preceding paragraph (1), by inserting `and to carry out the duty under subsection (a) of this section' before `, each enterprise shall';CommentsClose CommentsPermalink
(B) in paragraph (3), by inserting `and' after the semicolon at the end;CommentsClose CommentsPermalink
(C) in paragraph (4), by striking `; and' and inserting a period;CommentsClose CommentsPermalink
(D) by striking paragraph (5); andCommentsClose CommentsPermalink
(E) by redesignating such subsection as subsection (b);CommentsClose CommentsPermalink
(4) by inserting before subsection (b) (as so redesignated by paragraph (3)(E) of this subsection) the following new subsection:CommentsClose CommentsPermalink
`(a) Duty To Serve Underserved Markets-CommentsClose CommentsPermalink
`(1) DUTY- In accordance with the purpose of the enterprises under section 301(3) of the Federal National Mortgage Association Charter Act (
`(2) UNDERSERVED MARKETS- To meet its duty under paragraph (1), each enterprise shall comply with the following requirements with respect to the following underserved markets:CommentsClose CommentsPermalink
`(A) MANUFACTURED HOUSING- The enterprise shall lead the industry in developing loan products and flexible underwriting guidelines to facilitate a secondary market for mortgages on manufactured homes for very low-, low-, and moderate-income families.CommentsClose CommentsPermalink
`(B) AFFORDABLE HOUSING PRESERVATION- The enterprise shall lead the industry in developing loan products and flexible underwriting guidelines to facilitate a secondary market to preserve housing affordable to very low-, low-, and moderate-income families, including housing projects subsidized under--CommentsClose CommentsPermalink
`(i) the project-based and tenant-based rental assistance programs under section 8 of the United States Housing Act of 1937;CommentsClose CommentsPermalink
`(ii) the program under section 236 of the National Housing Act;CommentsClose CommentsPermalink
`(iii) the below-market interest rate mortgage program under section 221(d)(4) of the National Housing Act;CommentsClose CommentsPermalink
`(iv) the supportive housing for the elderly program under section 202 of the Housing Act of 1959;CommentsClose CommentsPermalink
`(v) the supportive housing program for persons with disabilities under section 811 of the Cranston-Gonzalez National Affordable Housing Act;CommentsClose CommentsPermalink
`(vi) the programs under title IV of the McKinney-Vento Homeless Assistance Act (
`(vii) the rural rental housing program under section 515 of the Housing Act of 1949.CommentsClose CommentsPermalink
`(C) RURAL AND OTHER UNDERSERVED MARKETS- The enterprise shall lead the industry in developing loan products and flexible underwriting guidelines to facilitate a secondary market for mortgages on housing for very low-, low-, and moderate-income families in rural areas, and for mortgages for housing for any other underserved market for very low-, low-, and moderate-income families that the Secretary identifies as lacking adequate credit through conventional lending sources. Such underserved markets may be identified by borrower type, market segment, or geographic area.'; andCommentsClose CommentsPermalink
(5) by adding at the end the following new subsection:CommentsClose CommentsPermalink
`(c) Evaluation and Reporting of Compliance-CommentsClose CommentsPermalink
`(1) IN GENERAL- Not later than 6 months after the effective date under section 185 of the Federal Housing Finance Reform Act of 2007, the Director shall establish a manner for evaluating whether, and the extent to which, the enterprises have complied with the duty under subsection (a) to serve underserved markets and for rating the extent of such compliance. Using such method, the Director shall, for each year, evaluate such compliance and rate the performance of each enterprise as to extent of compliance. The Director shall include such evaluation and rating for each enterprise for a year in the report for that year submitted pursuant to section 1319B(a).CommentsClose CommentsPermalink
`(2) SEPARATE EVALUATIONS- In determining whether an enterprise has complied with the duty referred to in paragraph (1), the Director shall separately evaluate whether the enterprise has complied with such duty with respect to each of the underserved markets identified in subsection (a), taking into consideration--CommentsClose CommentsPermalink
`(A) the development of loan products and more flexible underwriting guidelines;CommentsClose CommentsPermalink
`(B) the extent of outreach to qualified loan sellers in each of such underserved markets; andCommentsClose CommentsPermalink
`(C) the volume of loans purchased in each of such underserved markets.CommentsClose CommentsPermalink
`(3) MANUFACTURED HOUSING MARKET- In determining whether an enterprise has complied with the duty under subparagraph (A) of subsection (a)(2), the Director may consider loans secured by both real and personal property.'.CommentsClose CommentsPermalink
(b) Enforcement- Subsection (a) of section 1336 of the Housing and Community Development Act of 1992 (
(1) in paragraph (1), by inserting `and with the duty under section 1335(a) of each enterprise with respect to underserved markets,' before `as provided in this section'; andCommentsClose CommentsPermalink
(2) by adding at the end of such subsection, as amended by the preceding provisions of this title, the following new paragraph:CommentsClose CommentsPermalink
`(4) ENFORCEMENT OF DUTY TO PROVIDE MORTGAGE CREDIT TO UNDERSERVED MARKETS- The duty under section 1335(a) of each enterprise to serve underserved markets (as determined in accordance with section 1335(c)) shall be enforceable under this section to the same extent and under the same provisions that the housing goals established under this subpart are enforceable. Such duty shall not be enforceable under any other provision of this title (including subpart C of this part) other than this section or under any provision of the Federal National Mortgage Association Charter Act or the Federal Home Loan Mortgage Corporation Act.'.CommentsClose CommentsPermalink
SEC. 139. MONITORING AND ENFORCING COMPLIANCE WITH HOUSING GOALS.
(a) Additional Credit for Certain Mortgages- Section 1336(a) of the Housing and Community Development Act of 1992 (
(1) in paragraph (2), by inserting `, except as provided in paragraph (4),' after `which'; andCommentsClose CommentsPermalink
(2) by adding at the end the following new paragraph:CommentsClose CommentsPermalink
`(5) ADDITIONAL CREDIT- The Director shall assign more than 125 percent credit toward achievement, under this section, of the housing goals for mortgage purchase activities of the enterprises that comply with the requirements of such goals and support--CommentsClose CommentsPermalink
`(A) housing that meets energy efficiency or other environmental standards that are established by a Federal, State, or local governmental authority with respect to the geographic area where the housing is located or are otherwise widely recognized; orCommentsClose CommentsPermalink
`(B) housing that includes a licensed childcare center.CommentsClose CommentsPermalink
The availability of additional credit under this paragraph shall not be used to increase any housing goal, subgoal, or target established under this subpart.'.CommentsClose CommentsPermalink
(b) Monitoring and Enforcement- Section 1336 of the Housing and Community Development Act of 1992 (
(1) in subsection (b)--CommentsClose CommentsPermalink
(A) in the subsection heading, by inserting `Preliminary' before `Determination';CommentsClose CommentsPermalink
(B) by striking paragraph (1) and inserting the following new paragraph:CommentsClose CommentsPermalink
`(1) NOTICE- If the Director preliminarily determines that an enterprise has failed, or that there is a substantial probability that an enterprise will fail, to meet any housing goal established under this subpart, the Director shall provide written notice to the enterprise of such a preliminary determination, the reasons for such determination, and the information on which the Director based the determination.';CommentsClose CommentsPermalink
(C) in paragraph (2)--CommentsClose CommentsPermalink
(i) in subparagraph (A), by inserting `finally' before `determining';CommentsClose CommentsPermalink
(ii) by striking subparagraphs (B) and (C) and inserting the following new subparagraph:CommentsClose CommentsPermalink
`(B) EXTENSION OR SHORTENING OF PERIOD- The Director may--CommentsClose CommentsPermalink
`(i) extend the period under subparagraph (A) for good cause for not more than 30 additional days; andCommentsClose CommentsPermalink
`(ii) shorten the period under subparagraph (A) for good cause.'; andCommentsClose CommentsPermalink
(iii) by redesignating subparagraph (D) as subparagraph (C); andCommentsClose CommentsPermalink
(D) in paragraph (3)--CommentsClose CommentsPermalink
(i) in subparagraph (A), by striking `determine' and inserting `issue a final determination of';CommentsClose CommentsPermalink
(ii) in subparagraph (B), by inserting `final' before `determinations'; andCommentsClose CommentsPermalink
(iii) in subparagraph (C)--CommentsClose CommentsPermalink
(I) by striking `Committee on Banking, Finance and Urban Affairs' and inserting `Committee on Financial Services'; andCommentsClose CommentsPermalink
(II) by inserting `final' before `determination' each place such term appears; andCommentsClose CommentsPermalink
(2) in subsection (c)--CommentsClose CommentsPermalink
(A) by striking the subsection designation and heading and all that follows through the end of paragraph (1) and inserting the following:CommentsClose CommentsPermalink
`(c) Cease and Desist Orders, Civil Money Penalties, and Remedies Including Housing Plans-CommentsClose CommentsPermalink
`(1) REQUIREMENT- If the Director finds, pursuant to subsection (b), that there is a substantial probability that an enterprise will fail, or has actually failed, to meet any housing goal under this subpart and that the achievement of the housing goal was or is feasible, the Director may require that the enterprise submit a housing plan under this subsection. If the Director makes such a finding and the enterprise refuses to submit such a plan, submits an unacceptable plan, fails to comply with the plan or the Director finds that the enterprise has failed to meet any housing goal under this subpart, in addition to requiring an enterprise to submit a housing plan, the Director may issue a cease and desist order in accordance with section 1341, impose civil money penalties in accordance with section 1345, or order other remedies as set forth in paragraph (7) of this subsection.';CommentsClose CommentsPermalink
(B) in paragraph (2)--CommentsClose CommentsPermalink
(i) by striking `CONTENTS- Each housing plan' and inserting `HOUSING PLAN- If the Director requires a housing plan under this section, such a plan'; andCommentsClose CommentsPermalink
(ii) in subparagraph (B), by inserting `and changes in its operations' after `improvements';CommentsClose CommentsPermalink
(C) in paragraph (3)--CommentsClose CommentsPermalink
(i) by inserting `comply with any remedial action or' before `submit a housing plan'; andCommentsClose CommentsPermalink
(ii) by striking `under subsection (b)(3) that a housing plan is required';CommentsClose CommentsPermalink
(D) in paragraph (4), by striking the first two sentences and inserting the following: `The Director shall review each submission by an enterprise, including a housing plan submitted under this subsection, and not later than 30 days after submission, approve or disapprove the plan or other action. The Director may extend the period for approval or disapproval for a single additional 30-day period if the Director determines such extension necessary.'; andCommentsClose CommentsPermalink
(E) by adding at the end the following new paragraph:CommentsClose CommentsPermalink
`(7) ADDITIONAL REMEDIES FOR FAILURE TO MEET GOALS- In addition to ordering a housing plan under this section, issuing cease and desist orders under section 1341, and ordering civil money penalties under section 1345, the Director may seek other actions when an enterprise fails to meet a goal, and exercise appropriate enforcement authority available to the Director under this Act to prohibit the enterprise from initially offering any product (as such term is defined in section 1321(f)) or engaging in any new activities, services, undertakings, and offerings and to order the enterprise to suspend products and activities, services, undertakings, and offerings pending its achievement of the goal.'.CommentsClose CommentsPermalink
SEC. 140. AFFORDABLE HOUSING FUND.
(a) In General- The Housing and Community Development Act of 1992 is amended by striking sections 1337 and 1338 (
`SEC. 1337. AFFORDABLE HOUSING FUND.
`(a) Establishment and Purpose- The Director, in consultation with the Secretary of Housing and Urban Development, shall establish and manage an affordable housing fund in accordance with this section, which shall be funded with amounts allocated by the enterprises under subsection (b). The purpose of the affordable housing fund shall be to provide formula grants to grantees for use--CommentsClose CommentsPermalink
`(1) to increase homeownership for extremely low-and very low-income families;CommentsClose CommentsPermalink
`(2) to increase investment in housing in low-income areas, and areas designated as qualified census tracts or an area of chronic economic distress pursuant to section 143(j) of the Internal Revenue Code of 1986 (
`(3) to increase and preserve the supply of rental and owner-occupied housing for extremely low- and very low-income families;CommentsClose CommentsPermalink
`(4) to increase investment in public infrastructure development in connection with housing assisted under this section; andCommentsClose CommentsPermalink
`(5) to leverage investments from other sources in affordable housing and in public infrastructure development in connection with housing assisted under this section.CommentsClose CommentsPermalink
`(b) Allocation of Amounts by Enterprises-CommentsClose CommentsPermalink
`(1) IN GENERAL- In accordance with regulations issued by the Director under subsection (m) and subject to paragraph (2) of this subsection and subsection (i)(5), each enterprise shall allocate to the affordable housing fund established under subsection (a), in each of the years 2007 through 2011, an amount equal to 1.2 basis points for each dollar of the average total mortgage portfolio of the enterprise during the preceding year.CommentsClose CommentsPermalink
`(2) SUSPENSION OF CONTRIBUTIONS- The Director shall temporarily suspend the allocation under paragraph (1) by an enterprise to the affordable housing fund upon a finding by the Director that such allocations--CommentsClose CommentsPermalink
`(A) are contributing, or would contribute, to the financial instability of the enterprise;CommentsClose CommentsPermalink
`(B) are causing, or would cause, the enterprise to be classified as undercapitalized; orCommentsClose CommentsPermalink
`(C) are preventing, or would prevent, the enterprise from successfully completing a capital restoration plan under section 1369C.CommentsClose CommentsPermalink
`(3) 5-year SUNSET AND REPORT-CommentsClose CommentsPermalink
`(A) SUNSET- The enterprises shall not be required to make allocations to the affordable housing fund in 2012 or in any year thereafter.CommentsClose CommentsPermalink
`(B) REPORT ON PROGRAM CONTINUANCE- Not later than June 30, 2011, the Director shall submit to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate a report making recommendations on whether the program under this section, including the requirement for the enterprises to make allocations to the affordable housing fund, should be extended and on any modifications for the program.CommentsClose CommentsPermalink
`(4) PROHIBITION OF PASS-THROUGH OF COST OF ALLOCATIONS- The Director shall, by regulation, prohibit each enterprise from redirecting such costs, through increased charges or fees, or decreased premiums, or in any other manner, to the originators of mortgages purchased or securitized by the enterprise.CommentsClose CommentsPermalink
`(c) Affordable Housing Needs Formulas-CommentsClose CommentsPermalink
`(1) ALLOCATION FOR 2007-CommentsClose CommentsPermalink
`(A) ALLOCATION PERCENTAGES FOR LOUISIANA AND MISSISSIPPI- For purposes of subsection (d)(1)(A), the allocation percentages for 2007 for the grantees under this section for such year shall be as follows:CommentsClose CommentsPermalink
`(i) The allocation percentage for the Louisiana Housing Finance Agency shall be 75 percent.CommentsClose CommentsPermalink
`(ii) The allocation percentage for the Mississippi Development Authority shall be 25 percent.CommentsClose CommentsPermalink
`(B) USE IN DISASTER AREAS- Affordable housing grant amounts for 2007 shall be used only as provided in subsection (g) only for such eligible activities in areas that were subject to a declaration by the President of a major disaster or emergency under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (
`(2) ALLOCATION FORMULA FOR OTHER YEARS- The Secretary of Housing and Urban Development shall, by regulation, establish a formula to allocate, among the States (as such term is defined in section 1303) and federally recognized Indian tribes, the amounts provided by the enterprises in each year referred to subsection (b)(1), other than 2007, to the affordable housing fund established under this section. The formula shall be based on the following factors, with respect to each State and tribe:CommentsClose CommentsPermalink
`(A) The ratio of the population of the State or federally recognized Indian tribe to the aggregate population of all the States and tribes.CommentsClose CommentsPermalink
`(B) The percentage of families in the State or federally recognized Indian tribe that pay more than 50 percent of their annual income for housing costs.CommentsClose CommentsPermalink
`(C) The percentage of persons in the State or federally recognized Indian tribe that are members of extremely low- or very low-income families.CommentsClose CommentsPermalink
`(D) The cost of developing or carrying out rehabilitation of housing in the State or for the federally recognized Indian tribe.CommentsClose CommentsPermalink
`(E) The percentage of families in the State or federally recognized Indian tribe that live in substandard housing.CommentsClose CommentsPermalink
`(F) The percentage of housing stock in the State or for the federally recognized Indian tribe that is extremely old housing.CommentsClose CommentsPermalink
`(G) Any other factors that the Secretary determines to be appropriate.CommentsClose CommentsPermalink
`(3) FAILURE TO ESTABLISH- If, in any year referred to in subsection (b)(1), other than 2007, the regulations establishing the formula required under paragraph (2) of this subsection have not been issued by the date that the Director determines the amounts described in subsection (d)(1) to be available for affordable housing fund grants in such year, for purposes of such year any amounts for a State (as such term is defined in section 1303 of this Act) that would otherwise be determined under subsection (d) by applying the formula established pursuant to paragraph (2) of this subsection shall be determined instead by applying, for such State, the percentage that is equal to the percentage of the total amounts made available for such year for allocation under subtitle A of title II of the Cranston-Gonzalez National Affordable Housing Act (
`(d) Allocation of Formula Amount; Grants-CommentsClose CommentsPermalink
`(1) FORMULA AMOUNT- For each year referred to in subsection (b)(1), the Director shall determine the formula amount under this section for each grantee, which shall be the amount determined for such grantee--CommentsClose CommentsPermalink
`(A) for 2007, by applying the allocation percentages under subparagraph (A) of subsection (c)(1) to the sum of the total amounts allocated by the enterprises to the affordable housing fund for such year, less any amounts used pursuant to subsection (i)(1); andCommentsClose CommentsPermalink
`(B) for any other year referred to in subsection (b)(1) (other than 2007), by applying the formula established pursuant to paragraph (2) of subsection (c) to the sum of the total amounts allocated by the enterprises to the affordable housing fund for such year and any recaptured amounts available pursuant to subsection (i)(4), less any amounts used pursuant to subsection (i)(1).CommentsClose CommentsPermalink
`(2) NOTICE- In each year referred to in subsection (b)(1), not later than 60 days after the date that the Director determines the amounts described in paragraph (1) to be available for affordable housing fund grants to grantees in such year, the Director shall cause to be published in the Federal Register a notice that such amounts shall be so available.CommentsClose CommentsPermalink
`(3) GRANT AMOUNT-CommentsClose CommentsPermalink
`(A) IN GENERAL- For each year referred to in subsection (b)(1), the Director shall make a grant from amounts in the affordable housing fund to each grantee in an amount that is, except as provided in subparagraph (B), equal to the formula amount under this section for the grantee. A grantee may designate a State housing finance agency, housing and community development entity, tribally designated housing entity (as such term is defined in section 4 of the Native American Housing Assistance and Self-Determination Act of 1997 (
`(B) REDUCTION FOR FAILURE TO OBTAIN RETURN OF MISUSED FUNDS- If in any year a grantee fails to obtain reimbursement or return of the full amount required under subsection (j)(1)(B) to be reimbursed or returned to the grantee during such year--CommentsClose CommentsPermalink
`(i) except as provided in clause (ii)--CommentsClose CommentsPermalink
`(I) the amount of the grant for the grantee for the succeeding year, as determined pursuant to subparagraph (A), shall be reduced by the amount by which such amounts required to be reimbursed or returned exceed the amount actually reimbursed or returned; andCommentsClose CommentsPermalink
`(II) the amount of the grant for the succeeding year for each other grantee whose grant is not reduced pursuant to subclause (I) shall be increased by the amount determined by applying the formula established pursuant to subsection (c)(2) to the total amount of all reductions for all grantees for such year pursuant to subclause (I); orCommentsClose CommentsPermalink
`(ii) in any case in which such failure to obtain reimbursement or return occurs during a year immediately preceding a year in which grants under this subsection will not be made, the grantee shall pay to the Director for reallocation among the other grantees an amount equal to the amount of the reduction for the grantee that would otherwise apply under clause (i)(I).CommentsClose CommentsPermalink
`(e) Grantee Allocation Plans-CommentsClose CommentsPermalink
`(1) IN GENERAL- For each year that a grantee receives affordable housing fund grant amounts, the grantee shall establish an allocation plan in accordance with this subsection, which shall be a plan for the distribution of such grant amounts of the grantee for such year that--CommentsClose CommentsPermalink
`(A) is based on priority housing needs, as determined by the grantee in accordance with the regulations established under subsection (m)(2)(C);CommentsClose CommentsPermalink
`(B) complies with subsection (f); andCommentsClose CommentsPermalink
`(C) includes performance goals, benchmarks, and timetables for the grantee for the production, preservation, and rehabilitation of affordable rental and homeownership housing with such grant amounts that comply with the requirements established by the Director pursuant to subsection (m)(2)(F).CommentsClose CommentsPermalink
`(2) ESTABLISHMENT- In establishing an allocation plan, a grantee shall notify the public of the establishment of the plan, provide an opportunity for public comments regarding the plan, consider any public comments received, and make the completed plan available to the public.CommentsClose CommentsPermalink
`(3) CONTENTS- An allocation plan of a grantee shall set forth the requirements for eligible recipients under subsection (h) to apply to the grantee to receive assistance from affordable housing fund grant amounts, including a requirement that each such application include--CommentsClose CommentsPermalink
`(A) a description of the eligible activities to be conducted using such assistance; andCommentsClose CommentsPermalink
`(B) a certification by the eligible recipient applying for such assistance that any housing units assisted with such assistance will comply with the requirements under this section.CommentsClose CommentsPermalink
`(f) Selection of Activities Funded Using Affordable Housing Fund Grant Amounts- Affordable housing fund grant amounts of a grantee may be used, or committed for use, only for activities that--CommentsClose CommentsPermalink
`(1) are eligible under subsection (g) for such use;CommentsClose CommentsPermalink
`(2) comply with the applicable allocation plan under subsection (e) of the grantee; andCommentsClose CommentsPermalink
`(3) are selected for funding by the grantee in accordance with the process and criteria for such selection established pursuant to subsection (m)(2)(C).CommentsClose CommentsPermalink
`(g) Eligible Activities- Affordable housing fund grant amounts of a grantee shall be eligible for use, or for commitment for use, only for assistance for--CommentsClose CommentsPermalink
`(1) the production, preservation, and rehabilitation of rental housing, including housing under the programs identified in section 1335(a)(2)(B), except that such grant amounts may be used for the benefit only of extremely low- and very low-income families;CommentsClose CommentsPermalink
`(2) the production, preservation, and rehabilitation of housing for homeownership, including such forms as downpayment assistance, closing cost assistance, and assistance for interest-rate buy-downs, that--CommentsClose CommentsPermalink
`(A) is available for purchase only for use as a principal residence by families that qualify both as--CommentsClose CommentsPermalink
`(i) extremely low- and very-low income families at the times described in subparagraphs (A) through (C) of section 215(b)(2) of the Cranston-Gonzalez National Affordable Housing Act (
`(ii) first-time homebuyers, as such term is defined in section 104 of the Cranston-Gonzalez National Affordable Housing Act (
`(B) has an initial purchase price that meets the requirements of section 215(b)(1) of the Cranston-Gonzalez National Affordable Housing Act;CommentsClose CommentsPermalink
`(C) is subject to the same resale restrictions established under section 215(b)(3) of the Cranston-Gonzalez National Affordable Housing Act and applicable to the participating jurisdiction that is the State in which such housing is located; andCommentsClose CommentsPermalink
`(D) is made available for purchase only by, or in the case of assistance under this paragraph, is made available only to, homebuyers who have, before purchase--CommentsClose CommentsPermalink
`(i) completed a program of counseling with respect to the responsibilities and financial management involved in homeownership that is approved by the Director; except that the Director may, at the request of a State, waive the requirements of this subparagraph with respect to a geographic area or areas within the State if: (I) the travel time or distance involved in providing counseling with respect to such area or areas, as otherwise required under this subparagraph, on an in-person basis is excessive or the cost of such travel is prohibitive; and (II) the State provides alternative forms of counseling for such area or areas, which may include interactive telephone counseling, on-line counseling, interactive video counseling, and interactive home study counseling and a program of financial literacy and education to promote an understanding of consumer, economic, and personal finance issues and concepts, including saving for retirement, managing credit, long-term care, and estate planning and education on predatory lending, identity theft, and financial abuse schemes relating to homeownership that is approved by the Director, except that entities providing such counseling shall not discriminate against any particular form of housing; andCommentsClose CommentsPermalink
`(ii) demonstrated, in accordance with regulations as the Director shall issue setting forth requirements for sufficient evidence, that they are lawfully present in the United States; andCommentsClose CommentsPermalink
`(3) public infrastructure development activities in connection with housing activities funded under paragraph (1) or (2).CommentsClose CommentsPermalink
`(h) Eligible Recipients- Affordable housing fund grant amounts of a grantee may be provided only to a recipient that is an organization, agency, or other entity (including a for-profit entity, a nonprofit entity, and a faith-based organization) that--CommentsClose CommentsPermalink
`(1) has demonstrated experience and capacity to conduct an eligible activity under (g), as evidenced by its ability to--CommentsClose CommentsPermalink
`(A) own, construct or rehabilitate, manage, and operate an affordable multifamily rental housing development;CommentsClose CommentsPermalink
`(B) design, construct or rehabilitate, and market affordable housing for homeownership;CommentsClose CommentsPermalink
`(C) provide forms of assistance, such as downpayments, closing costs, or interest-rate buy-downs, for purchasers; orCommentsClose CommentsPermalink
`(D) construct related public infrastructure development activities in connection with such housing activities;CommentsClose CommentsPermalink
`(2) demonstrates the ability and financial capacity to undertake, comply, and manage the eligible activity;CommentsClose CommentsPermalink
`(3) demonstrates its familiarly with the requirements of any other Federal, State or local housing program that will be used in conjunction with such grant amounts to ensure compliance with all applicable requirements and regulations of such programs; andCommentsClose CommentsPermalink
`(4) makes such assurances to the grantee as the Director shall, by regulation, require to ensure that the recipient will comply with the requirements of this section during the entire period that begins upon selection of the recipient to receive such grant amounts and ending upon the conclusion of all activities under subsection (g) that are engaged in by the recipient and funded with such grant amounts.CommentsClose CommentsPermalink
`(i) Limitations on Use-CommentsClose CommentsPermalink
`(1) REQUIRED AMOUNT FOR REFCORP- Of the aggregate amount allocated pursuant to subsection (b) in each year to the affordable housing fund, 25 percent shall be used as provided in section 21B(f)(2)(E) of the Federal Home Loan Bank Act (
`(2) REQUIRED AMOUNT FOR HOMEOWNERSHIP ACTIVITIES- Of the aggregate amount of affordable housing fund grant amounts provided in each year to a grantee, not less than 10 percent shall be used for activities under paragraph (2) of subsection (g).CommentsClose CommentsPermalink
`(3) MAXIMUM AMOUNT FOR PUBLIC INFRASTRUCTURE DEVELOPMENT ACTIVITIES IN CONNECTION WITH AFFORDABLE HOUSING ACTIVITIES- Of the aggregate amount of affordable housing fund grant amounts provided in each year to a grantee, not more than 12.5 percent may be used for activities under paragraph (3) of subsection (g).CommentsClose CommentsPermalink
`(4) DEADLINE FOR COMMITMENT OR USE- Any affordable housing fund grant amounts of a grantee shall be used or committed for use within two years of the date of that such grant amounts are made available to the grantee. The Director shall recapture into the affordable housing fund any such amounts not so used or committed for use and allocate such amounts under subsection (d)(1) in the first year after such recapture.CommentsClose CommentsPermalink
`(5) USE OF RETURNS- The Director shall, by regulation provide that any return on a loan or other investment of any affordable housing fund grant amounts of a grantee shall be treated, for purposes of availability to and use by the grantee, as affordable housing fund grant amounts.CommentsClose CommentsPermalink
`(6) PROHIBITED USES- The Director shall--CommentsClose CommentsPermalink
`(A) by regulation, set forth prohibited uses of affordable housing fund grant amounts, which shall include use for--CommentsClose CommentsPermalink
`(i) political activities;CommentsClose CommentsPermalink
`(ii) advocacy;CommentsClose CommentsPermalink
`(iii) lobbying, whether directly or through other parties;CommentsClose CommentsPermalink
`(iv) counseling services;CommentsClose CommentsPermalink
`(v) travel expenses; andCommentsClose CommentsPermalink
`(vi) preparing or providing advice on tax returns;CommentsClose CommentsPermalink
`(B) by regulation, provide that, except as provided in subparagraph (C), affordable housing fund grant amounts of a grantee may not be used for administrative, outreach, or other costs of--CommentsClose CommentsPermalink
`(i) the grantee; orCommentsClose CommentsPermalink
`(ii) any recipient of such grant amounts; andCommentsClose CommentsPermalink
`(C) by regulation, limit the amount of any affordable housing fund grant amounts of the grantee for a year that may be used for administrative costs of the grantee of carrying out the program required under this section to a percentage of such grant amounts of the grantee for such year, which may not exceed 10 percent.CommentsClose CommentsPermalink
`(7) PROHIBITION OF CONSIDERATION OF USE FOR MEETING HOUSING GOALS OR DUTY TO SERVE- In determining compliance with the housing goals under this subpart and the duty to serve underserved markets under section 1335, the Director may not consider any affordable housing fund grant amounts used under this section for eligible activities under subsection (g). The Director shall give credit toward the achievement of such housing goals and such duty to serve underserved markets to purchases by the enterprises of mortgages for housing that receives funding from affordable housing fund grant amounts, but only to the extent that such purchases by the enterprises are funded other than with such grant amounts.CommentsClose CommentsPermalink
`(8) ACCEPTABLE IDENTIFICATION REQUIREMENT FOR OCCUPANCY OR ASSISTANCE-CommentsClose CommentsPermalink
`(A) IN GENERAL- Any assistance provided with any affordable housing grant amounts may not be made available to, or on behalf of, any individual or household unless the individual provides, or, in the case of a household, all adult members of the household provide, personal identification in one of the following forms:CommentsClose CommentsPermalink
`(i) SOCIAL SECURITY CARD WITH PHOTO IDENTIFICATION CARD OR REAL ID ACT IDENTIFICATION-CommentsClose CommentsPermalink
`(I) A social security card accompanied by a photo identification card issued by the Federal Government or a State Government; orCommentsClose CommentsPermalink
`(II) A driver's license or identification card issued by a State in the case of a State that is in compliance with title II of the REAL ID Act of 2005 (title II of division B of
`(ii) PASSPORT- A passport issued by the United States or a foreign government.CommentsClose CommentsPermalink
`(iii) USCIS PHOTO IDENTIFICATION CARD- A photo identification card issued by the Secretary of Homeland Security (acting through the Director of the United States Citizenship and Immigration Services).CommentsClose CommentsPermalink
`(B) REGULATIONS- The Director shall, by regulation, require that each grantee and recipient take such actions as the Director considers necessary to ensure compliance with the requirements of subparagraph (A).CommentsClose CommentsPermalink
`(j) Accountability of Recipients and Grantees-CommentsClose CommentsPermalink
`(1) RECIPIENTS-CommentsClose CommentsPermalink
`(A) TRACKING OF FUNDS- The Director shall--CommentsClose CommentsPermalink
`(i) require each grantee to develop and maintain a system to ensure that each recipient of assistance from affordable housing fund grant amounts of the grantee uses such amounts in accordance with this section, the regulations issued under this section, and any requirements or conditions under which such amounts were provided; andCommentsClose CommentsPermalink
`(ii) establish minimum requirements for agreements, between the grantee and recipients, regarding assistance from the affordable housing fund grant amounts of the grantee, which shall include--CommentsClose CommentsPermalink
`(I) appropriate continuing financial and project reporting, record retention, and audit requirements for the duration of the grant to the recipient to ensure compliance with the limitations and requirements of this section and the regulations under this section; andCommentsClose CommentsPermalink
`(II) any other requirements that the Director determines are necessary to ensure appropriate grant administration and compliance.CommentsClose CommentsPermalink
`(B) MISUSE OF FUNDS-CommentsClose CommentsPermalink
`(i) REIMBURSEMENT REQUIREMENT- If any recipient of assistance from affordable housing fund grant amounts of a grantee is determined, in accordance with clause (ii), to have used any such amounts in a manner that is materially in violation of this section, the regulations issued under this section, or any requirements or conditions under which such amounts were provided, the grantee shall require that, within 12 months after the determination of such misuse, the recipient shall reimburse the grantee for such misused amounts and return to the grantee any amounts from the affordable housing fund grant amounts of the grantee that remain unused or uncommitted for use. The remedies under this clause are in addition to any other remedies that may be available under law.CommentsClose CommentsPermalink
`(ii) DETERMINATION- A determination is made in accordance with this clause if the determination is--CommentsClose CommentsPermalink
`(I) made by the Director; orCommentsClose CommentsPermalink
`(II)(aa) made by the grantee;CommentsClose CommentsPermalink
`(bb) the grantee provides notification of the determination to the Director for review, in the discretion of the Director, of the determination; andCommentsClose CommentsPermalink
`(cc) the Director does not subsequently reverse the determination.CommentsClose CommentsPermalink
`(2) GRANTEES-CommentsClose CommentsPermalink
`(A) REPORT-CommentsClose CommentsPermalink
`(i) IN GENERAL- The Director shall require each grantee receiving affordable housing fund grant amounts for a year to submit a report, for such year, to the Director that--CommentsClose CommentsPermalink
`(I) describes the activities funded under this section during such year with the affordable housing fund grant amounts of the grantee; andCommentsClose CommentsPermalink
`(II) the manner in which the grantee complied during such year with the allocation plan established pursuant to subsection (e) for the grantee.CommentsClose CommentsPermalink
`(ii) PUBLIC AVAILABILITY- The Director shall make such reports pursuant to this subparagraph publicly available.CommentsClose CommentsPermalink
`(B) MISUSE OF FUNDS- If the Director determines, after reasonable notice and opportunity for hearing, that a grantee has failed to comply substantially with any provision of this section and until the Director is satisfied that there is no longer any such failure to comply, the Director shall--CommentsClose CommentsPermalink
`(i) reduce the amount of assistance under this section to the grantee by an amount equal to the amount affordable housing fund grant amounts which were not used in accordance with this section;CommentsClose CommentsPermalink
`(ii) require the grantee to repay the Director an amount equal to the amount of the amount affordable housing fund grant amounts which were not used in accordance with this section;CommentsClose CommentsPermalink
`(iii) limit the availability of assistance under this section to the grantee to activities or recipients not affected by such failure to comply; orCommentsClose CommentsPermalink
`(iv) terminate any assistance under this section to the grantee.CommentsClose CommentsPermalink
`(k) Capital Requirements- The utilization or commitment of amounts from the affordable housing fund shall not be subject to the risk-based capital requirements established pursuant to section 1361(a).CommentsClose CommentsPermalink
`(l) Definitions- For purposes of this section, the following definitions shall apply:CommentsClose CommentsPermalink
`(1) AFFORDABLE HOUSING FUND GRANT AMOUNTS- The term `affordable housing fund grant amounts' means amounts from the affordable housing fund established under subsection (a) that are provided to a grantee pursuant to subsection (d)(3).CommentsClose CommentsPermalink
`(2) GRANTEE- The term `grantee' means--CommentsClose CommentsPermalink
`(A) with respect to 2007, the Louisiana Housing Finance Agency and the Mississippi Development Authority; andCommentsClose CommentsPermalink
`(B) with respect to the years referred to in subsection (b)(1), other than 2007, each State (as such term is defined in section 1303) and each federally recognized Indian tribe.CommentsClose CommentsPermalink
`(3) RECIPIENT- The term `recipient' means an entity meeting the requirements under subsection (h) that receives assistance from a grantee from affordable housing fund grant amounts of the grantee.CommentsClose CommentsPermalink
`(4) TOTAL MORTGAGE PORTFOLIO- The term `total mortgage portfolio' means, with respect to a year, the sum, for all mortgages outstanding during that year in any form, including whole loans, mortgage-backed securities, participation certificates, or other structured securities backed by mortgages, of the dollar amount of the unpaid outstanding principal balances under such mortgages. Such term includes all such mortgages or securitized obligations, whether retained in portfolio, or sold in any form. The Director is authorized to promulgate rules further defining such term as necessary to implement this section and to address market developments.CommentsClose CommentsPermalink
`(5) VERY-LOW INCOME FAMILY- The term `very low-income family' has the meaning given such term in section 1303, except that such term includes any family that resides in a rural area that has an income that does not exceed the poverty line (as such term is defined in section 673(2) of the Omnibus Budget Reconciliation Act of 1981 (
`(m) Regulations-CommentsClose CommentsPermalink
`(1) IN GENERAL- The Director, in consultation with the Secretary of Housing and Urban Development, shall issue regulations to carry out this section.CommentsClose CommentsPermalink
`(2) REQUIRED CONTENTS- The regulations issued under this subsection shall include--CommentsClose CommentsPermalink
`(A) a requirement that the Director ensure that the program of each grantee for use of affordable housing fund grant amounts of the grantee is audited not less than annually to ensure compliance with this section;CommentsClose CommentsPermalink
`(B) authority for the Director to audit, provide for an audit, or otherwise verify a grantee's activities, to ensure compliance with this section;CommentsClose CommentsPermalink
`(C) requirements for a process for application to, and selection by, each grantee for activities meeting the grantee's priority housing needs to be funded with affordable housing fund grant amounts of the grantee, which shall provide for priority in funding to be based upon--CommentsClose CommentsPermalink
`(i) greatest impact;CommentsClose CommentsPermalink
`(ii) geographic diversity;CommentsClose CommentsPermalink
`(iii) ability to obligate amounts and undertake activities so funded in a timely manner;CommentsClose CommentsPermalink
`(iv) in the case of rental housing projects under subsection (g)(1), the extent to which rents for units in the project funded are affordable, especially for extremely low-income families;CommentsClose CommentsPermalink
`(v) in the case of rental housing projects under subsection (g)(1), the extent of the duration for which such rents will remain affordable;CommentsClose CommentsPermalink
`(vi) the extent to which the application makes use of other funding sources; andCommentsClose CommentsPermalink
`(vii) the merits of an applicant's proposed eligible activity;CommentsClose CommentsPermalink
`(D) requirements to ensure that amounts provided to a grantee from the affordable housing fund that are used for rental housing under subsection (g)(1) are used only for the benefit of extremely low- and very-low income families;CommentsClose CommentsPermalink
`(E) limitations on public infrastructure development activities that are eligible pursuant to subsection (g)(3) for funding with affordable housing fund grant amounts and requirements for the connection between such activities and housing activities funded under paragraph (1) or (2) of subsection (g); andCommentsClose CommentsPermalink
`(F) requirements and standards for establishment, by grantees (including the grantees for 2007 pursuant to subsection (l)(2)(A)), of performance goals, benchmarks, and timetables for the production, preservation, and rehabilitation of affordable rental and homeownership housing with affordable housing fund grant amounts.CommentsClose CommentsPermalink
`(n) Enforcement of Requirements on Enterprise- Compliance by the enterprises with the requirements under this section shall be enforceable under subpart C. Any reference in such subpart to this part or to an order, rule, or regulation under this part specifically includes this section and any order, rule, or regulation under this section.CommentsClose CommentsPermalink
`(o) Affordable Housing Trust Fund- If, after the enactment of this Act, in any year, there is enacted any provision of Federal law establishing an affordable housing trust fund other than under this title for use only for grants to provide affordable rental housing and affordable homeownership opportunities, and the subsequent year is a year referred to in subsection (b)(1), the Director shall in such subsequent year and any remaining years referred to in subsection (b)(1) transfer to such affordable housing trust fund the aggregate amount allocated pursuant to subsection (b) in such year to the affordable housing fund under this section, less any amounts used pursuant to subsection (i)(1). For such subsequent and remaining years, the provisions of subsections (c) and (d) shall not apply. Notwithstanding any other provision of law, assistance provided using amounts transferred to such affordable housing trust fund pursuant to this subsection may not be used for any of the activities specified in clauses (i) through (vi) of subsection (i)(6). Nothing in this subsection shall be construed to alter the terms and conditions of the affordable housing fund under this section or to extend the life of such fund.CommentsClose CommentsPermalink
`(p) Funding Accountability and Transparency- Any grant under this section to a grantee from the affordable housing fund established under subsection (a), any assistance provided to a recipient by a grantee from affordable housing fund grant amounts, and any grant, award, or other assistance from an affordable housing trust fund referred to in subsection (o) shall be considered a Federal award for purposes of the Federal Funding Accountability and Transparency Act of 2006 (
(b) Timely Establishment of Affordable Housing Needs Formula-CommentsClose CommentsPermalink
(1) IN GENERAL- The Secretary of Housing and Urban Development shall, not later than the effective date under section 185 of this Act, issue the regulations establishing the affordable housing needs formulas in accordance with the provisions of section 1337(c)(2) of the Housing and Community Development Act of 1992, as such section is amended by subsection (a) of this section.CommentsClose CommentsPermalink
(2) EFFECTIVE DATE- This subsection shall take effect on the date of the enactment of this Act.CommentsClose CommentsPermalink
(c) REFCORP Payments- Section 21B(f)(2) of the Federal Home Loan Bank Act (
(1) in subparagraph (E), by striking `and (D)' and inserting `(D), and (E)';CommentsClose CommentsPermalink
(2) by redesignating subparagraph (E) as subparagraph (F); andCommentsClose CommentsPermalink
(3) by inserting after subparagraph (D) the following new subparagraph:CommentsClose CommentsPermalink
`(E) PAYMENTS BY FANNIE MAE AND FREDDIE MAC- To the extent that the amounts available pursuant to subparagraphs (A), (B), (C), and (D) are insufficient to cover the amount of interest payments, each enterprise (as such term is defined in section 1303 of the Housing and Community Development Act of 1992 (
(d) GAO Report- The Comptroller General shall conduct a study to determine the effects that the affordable housing fund established under section 1337 of the Housing and Community Development Act of 1992, as added by the amendment made by subsection (a) of this section, will have on the availability and affordability of credit for homebuyers, including the effects on such credit of the requirement under such section 1337(b) that the Federal National Mortgage Association and Federal Home Loan Mortgage Corporation make allocations of amounts to such fund based on the average total mortgage portfolios, and the extent to which the costs of such allocation requirement will be borne by such entities or will be passed on to homebuyers. Not later than the expiration of the 12-month period beginning on the date of the enactment of this Act, the Comptroller General shall submit a report to the Congress setting forth the results and conclusions of such study. This subsection shall take effect on the date of the enactment of this Act.CommentsClose CommentsPermalink
SEC. 141. CONSISTENCY WITH MISSION.
Subpart B of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (
`SEC. 1338. CONSISTENCY WITH MISSION.
`This subpart may not be construed to authorize an enterprise to engage in any program or activity that contravenes or is inconsistent with the Federal National Mortgage Association Charter Act or the Federal Home Loan Mortgage Corporation Act.'.CommentsClose CommentsPermalink
SEC. 142. ENFORCEMENT.
(a) Cease-and-Desist Proceedings- Section 1341 of the Housing and Community Development Act of 1992 (
(1) by striking subsection (a) and inserting the following new subsection:CommentsClose CommentsPermalink
`(a) Grounds for Issuance- The Director may issue and serve a notice of charges under this section upon an enterprise if the Director determines--CommentsClose CommentsPermalink
`(1) the enterprise has failed to meet any housing goal established under subpart B, following a written notice and determination of such failure in accordance with section 1336;CommentsClose CommentsPermalink
`(2) the enterprise has failed to submit a report under section 1314, following a notice of such failure, an opportunity for comment by the enterprise, and a final determination by the Director;CommentsClose CommentsPermalink
`(3) the enterprise has failed to submit the information required under subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act, or subsection (e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act;CommentsClose CommentsPermalink
`(4) the enterprise has violated any provision of this part or any order, rule or regulation under this part;CommentsClose CommentsPermalink
`(5) the enterprise has failed to submit a housing plan that complies with section 1336(c) within the applicable period; orCommentsClose CommentsPermalink
`(6) the enterprise has failed to comply with a housing plan under section 1336(c).';CommentsClose CommentsPermalink
(2) in subsection (b)(2), by striking `requiring the enterprise to' and all that follows through the end of the paragraph and inserting the following: `requiring the enterprise to--CommentsClose CommentsPermalink
`(A) comply with the goal or goals;CommentsClose CommentsPermalink
`(B) submit a report under section 1314;CommentsClose CommentsPermalink
`(C) comply with any provision this part or any order, rule or regulation under such part;CommentsClose CommentsPermalink
`(D) submit a housing plan in compliance with section 1336(c);CommentsClose CommentsPermalink
`(E) comply with a housing plan submitted under section 1336(c); orCommentsClose CommentsPermalink
`(F) provide the information required under subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act or subsection (e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act, as applicable.';CommentsClose CommentsPermalink
(3) in subsection (c), by inserting `date of the' before `service of the order'; andCommentsClose CommentsPermalink
(4) by striking subsection (d).CommentsClose CommentsPermalink
(b) Authority of Director To Enforce Notices and Orders- Section 1344 of the Housing and Community Development Act of 1992 (
`(a) Enforcement- The Director may, in the discretion of the Director, apply to the United States District Court for the District of Columbia, or the United States district court within the jurisdiction of which the headquarters of the enterprise is located, for the enforcement of any effective and outstanding notice or order issued under section 1341 or 1345, or request that the Attorney General of the United States bring such an action. Such court shall have jurisdiction and power to order and require compliance with such notice or order.'.CommentsClose CommentsPermalink
(c) Civil Money Penalties- Section 1345 of the Housing and Community Development Act of 1992 (
(1) by striking subsections (a) and (b) and inserting the following new subsections:CommentsClose CommentsPermalink
`(a) Authority- The Director may impose a civil money penalty, in accordance with the provisions of this section, on any enterprise that has failed to--CommentsClose CommentsPermalink
`(1) meet any housing goal established under subpart B, following a written notice and determination of such failure in accordance with section 1336(b);CommentsClose CommentsPermalink
`(2) submit a report under section 1314, following a notice of such failure, an opportunity for comment by the enterprise, and a final determination by the Director;CommentsClose CommentsPermalink
`(3) submit the information required under subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act, or subsection (e) or (f) of section 307 of the Federal Home Loan Mortgage Corporation Act;CommentsClose CommentsPermalink
`(4) comply with any provision of this part or any order, rule or regulation under this part;CommentsClose CommentsPermalink
`(5) submit a housing plan pursuant to section 1336(c) within the required period; orCommentsClose CommentsPermalink
`(6) comply with a housing plan for the enterprise under section 1336(c).CommentsClose CommentsPermalink
`(b) Amount of Penalty- The amount of the penalty, as determined by the Director, may not exceed--CommentsClose CommentsPermalink
`(1) for any failure described in paragraph (1), (5), or (6) of subsection (a), $50,000 for each day that the failure occurs; andCommentsClose CommentsPermalink
`(2) for any failure described in paragraph (2), (3), or (4) of subsection (a), $20,000 for each day that the failure occurs.';CommentsClose CommentsPermalink
(2) in subsection (c)--CommentsClose CommentsPermalink
(A) in paragraph (1)--CommentsClose CommentsPermalink
(i) in subparagraph (A), by inserting `and' after the semicolon at the end;CommentsClose CommentsPermalink
(ii) in subparagraph (B), by striking `; and' and inserting a period; andCommentsClose CommentsPermalink
(iii) by striking subparagraph (C); andCommentsClose CommentsPermalink
(B) in paragraph (2), by inserting after the period at the end the following: `In determining the penalty under subsection (a)(1), the Director shall give consideration to the length of time the enterprise should reasonably take to achieve the goal.';CommentsClose CommentsPermalink
(3) in the first sentence of subsection (d)--CommentsClose CommentsPermalink
(A) by striking `request the Attorney General of the United States to' and inserting `, in the discretion of the Director,'; andCommentsClose CommentsPermalink
(B) by inserting `, or request that the Attorney General of the United States bring such an action' before the period at the end;CommentsClose CommentsPermalink
(4) by striking subsection (f); andCommentsClose CommentsPermalink
(5) by redesignating subsection (g) as subsection (f).CommentsClose CommentsPermalink
(d) Enforcement of Subpoenas- Section 1348(c) of the Housing and Community Development Act of 1992 (
(1) by striking `request the Attorney General of the United States to' and inserting `, in the discretion of the Director,'; andCommentsClose CommentsPermalink
(2) by inserting `or request that the Attorney General of the United States bring such an action,' after `District of Columbia,'.CommentsClose CommentsPermalink
(e) Conforming Amendment- The heading for subpart C of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 is amended to read as follows:CommentsClose CommentsPermalink
`Subpart C--Enforcement'.
SEC. 143. CONFORMING AMENDMENTS.
Part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (
(1) by striking `Secretary' each place such term appears in such part and inserting `Director';CommentsClose CommentsPermalink
(2) in the section heading for section 1323 (
(3) by striking section 1327 (
(4) by striking section 1328 (
(5) by redesignating section 1329 (as amended by section 135) as section 1327;CommentsClose CommentsPermalink
(6) in sections 1345(c)(1)(A), 1346(a), and 1346(b) (
(7) by striking section 1349 (
Subtitle C--Prompt Corrective Action
SEC. 151. CAPITAL CLASSIFICATIONS.
(a) In General- Section 1364 of the Housing and Community Development Act of 1992 (
(1) in the heading for subsection (a), by striking `In General' and inserting `Enterprises'.CommentsClose CommentsPermalink
(2) in subsection (c)--CommentsClose CommentsPermalink
(A) by striking `subsection (b)' and inserting `subsection (c)';CommentsClose CommentsPermalink
(B) by striking `enterprises' and inserting `regulated entities'; andCommentsClose CommentsPermalink
(C) by striking the last sentence;CommentsClose CommentsPermalink
(3) by redesignating subsections (c) (as so amended by paragraph (2) of this subsection) and (d) as subsections (d) and (f), respectively;CommentsClose CommentsPermalink
(4) by striking subsection (b) and inserting the following new subsections:CommentsClose CommentsPermalink
`(b) Federal Home Loan Banks-CommentsClose CommentsPermalink
`(1) ESTABLISHMENT AND CRITERIA- For purposes of this subtitle, the Director shall, by regulation--CommentsClose CommentsPermalink
`(A) establish the capital classifications specified under paragraph (2) for the Federal home loan banks;CommentsClose CommentsPermalink
`(B) establish criteria for each such capital classification based on the amount and types of capital held by a bank and the risk-based, minimum, and critical capital levels for the banks and taking due consideration of the capital classifications established under subsection (a) for the enterprises, with such modifications as the Director determines to be appropriate to reflect the difference in operations between the banks and the enterprises; andCommentsClose CommentsPermalink
`(C) shall classify the Federal home loan banks according to such capital classifications.CommentsClose CommentsPermalink
`(2) CLASSIFICATIONS- The capital classifications specified under this paragraph are--CommentsClose CommentsPermalink
`(A) adequately capitalized;CommentsClose CommentsPermalink
`(B) undercapitalized;CommentsClose CommentsPermalink
`(C) significantly undercapitalized; andCommentsClose CommentsPermalink
`(D) critically undercapitalized.CommentsClose CommentsPermalink
`(c) Discretionary Classification-CommentsClose CommentsPermalink
`(1) GROUNDS FOR RECLASSIFICATION- The Director may reclassify a regulated entity under paragraph (2) if--CommentsClose CommentsPermalink
`(A) at any time, the Director determines in writing that the regulated entity is engaging in conduct that could result in a rapid depletion of core or total capital or, in the case of an enterprise, that the value of the property subject to mortgages held or securitized by the enterprise has decreased significantly;CommentsClose CommentsPermalink
`(B) after notice and an opportunity for hearing, the Director determines that the regulated entity is in an unsafe or unsound condition; orCommentsClose CommentsPermalink
`(C) pursuant to section 1371(b), the Director deems the regulated entity to be engaging in an unsafe or unsound practice.CommentsClose CommentsPermalink
`(2) RECLASSIFICATION- In addition to any other action authorized under this title, including the reclassification of a regulated entity for any reason not specified in this subsection, if the Director takes any action described in paragraph (1) the Director may classify a regulated entity--CommentsClose CommentsPermalink
`(A) as undercapitalized, if the regulated entity is otherwise classified as adequately capitalized;CommentsClose CommentsPermalink
`(B) as significantly undercapitalized, if the regulated entity is otherwise classified as undercapitalized; andCommentsClose CommentsPermalink
`(C) as critically undercapitalized, if the regulated entity is otherwise classified as significantly undercapitalized.'; andCommentsClose CommentsPermalink
(5) by inserting after subsection (d) (as so redesignated by paragraph (3) of this subsection), the following new subsection:CommentsClose CommentsPermalink
`(e) Restriction on Capital Distributions-CommentsClose CommentsPermalink
`(1) IN GENERAL- A regulated entity shall make no capital distribution if, after making the distribution, the regulated entity would be undercapitalized.CommentsClose CommentsPermalink
`(2) EXCEPTION- Notwithstanding paragraph (1), the Director may permit a regulated entity, to the extent appropriate or applicable, to repurchase, redeem, retire, or otherwise acquire shares or ownership interests if the repurchase, redemption, retirement, or other acquisition--CommentsClose CommentsPermalink
`(A) is made in connection with the issuance of additional shares or obligations of the regulated entity in at least an equivalent amount; andCommentsClose CommentsPermalink
`(B) will reduce the financial obligations of the regulated entity or otherwise improve the financial condition of the entity.'.CommentsClose CommentsPermalink
(b) Regulations- Not later than the expiration of the 180-day period beginning on the effective date under section 185, the Director of the Federal Housing Finance Agency shall issue regulations to carry out section 1364(b) of the Housing and Community Development Act of 1992 (as added by paragraph (4) of this subsection), relating to capital classifications for the Federal home loan banks.CommentsClose CommentsPermalink
SEC. 152. SUPERVISORY ACTIONS APPLICABLE TO UNDERCAPITALIZED REGULATED ENTITIES.
Section 1365 of the Housing and Community Development Act of 1992 (
(1) in the section heading, by striking `enterprises' and inserting `regulated entities';CommentsClose CommentsPermalink
(2) in subsection (a)--CommentsClose CommentsPermalink
(A) by redesignating paragraphs (1) and (2) as paragraphs (2) and (3), respectively;CommentsClose CommentsPermalink
(B) by inserting before paragraph (2), as so redesignated by subparagraph (A) of this paragraph, the following paragraph:CommentsClose CommentsPermalink
`(1) REQUIRED MONITORING- The Director shall--CommentsClose CommentsPermalink
`(A) closely monitor the condition of any regulated entity that is classified as undercapitalized;CommentsClose CommentsPermalink
`(B) closely monitor compliance with the capital restoration plan, restrictions, and requirements imposed under this section; andCommentsClose CommentsPermalink
`(C) periodically review the plan, restrictions, and requirements applicable to the undercapitalized regulated entity to determine whether the plan, restrictions, and requirements are achieving the purpose of this section.'; andCommentsClose CommentsPermalink
(C) by inserting at the end the following new paragraphs:CommentsClose CommentsPermalink
`(4) RESTRICTION OF ASSET GROWTH- A regulated entity that is classified as undercapitalized shall not permit its average total assets (as such term is defined in section 1316(b) during any calendar quarter to exceed its average total assets during the preceding calendar quarter unless--CommentsClose CommentsPermalink
`(A) the Director has accepted the capital restoration plan of the regulated entity;CommentsClose CommentsPermalink
`(B) any increase in total assets is consistent with the plan; andCommentsClose CommentsPermalink
`(C) the ratio of total capital to assets for the regulated entity increases during the calendar quarter at a rate sufficient to enable the entity to become adequately capitalized within a reasonable time.CommentsClose CommentsPermalink
`(5) PRIOR APPROVAL OF ACQUISITIONS, NEW PRODUCTS, AND NEW ACTIVITIES- A regulated entity that is classified as undercapitalized shall not, directly or indirectly, acquire any interest in any entity or initially offer any new product (as such term is defined in section 1321(f)) or engage in any new activity, service, undertaking, or offering unless--CommentsClose CommentsPermalink
`(A) the Director has accepted the capital restoration plan of the regulated entity, the entity is implementing the plan, and the Director determines that the proposed action is consistent with and will further the achievement of the plan; orCommentsClose CommentsPermalink
`(B) the Director determines that the proposed action will further the purpose of this section.';CommentsClose CommentsPermalink
(3) in the subsection heading for subsection (b), by striking `From Undercapitalized to Significantly Undercapitalized'; andCommentsClose CommentsPermalink
(4) by striking subsection (c) and inserting the following new subsection:CommentsClose CommentsPermalink
`(c) Other Discretionary Safeguards- The Director may take, with respect to a regulated entity that is classified as undercapitalized, any of the actions authorized to be taken under section 1366 with respect to a regulated entity that is classified as significantly undercapitalized, if the Director determines that such actions are necessary to carry out the purpose of this subtitle.'.CommentsClose CommentsPermalink
SEC. 153. SUPERVISORY ACTIONS APPLICABLE TO SIGNIFICANTLY UNDERCAPITALIZED REGULATED ENTITIES.
Section 1366 of the Housing and Community Development Act of 1992 (
(1) in the section heading, by striking `enterprises' and inserting `regulated entities';CommentsClose CommentsPermalink
(2) in subsection (a)(2)(A), by striking `enterprise' the last place such term appears;CommentsClose CommentsPermalink
(3) in subsection (b)--CommentsClose CommentsPermalink
(A) in the subsection heading, by striking `Discretionary Supervisory Actions' and inserting `Specific Actions'.CommentsClose CommentsPermalink
(B) in the matter preceding paragraph (1), by striking `may, at any time, take any' and inserting `shall carry out this section by taking, at any time, one or more';CommentsClose CommentsPermalink
(C) by redesignating paragraphs (5) and (6) as paragraphs (6) and (7), respectively;CommentsClose CommentsPermalink
(D) by inserting after paragraph (4) the following new paragraph:CommentsClose CommentsPermalink
`(5) IMPROVEMENT OF MANAGEMENT- Take one or more of the following actions:CommentsClose CommentsPermalink
`(A) NEW ELECTION OF BOARD- Order a new election for the board of directors of the regulated entity.CommentsClose CommentsPermalink
`(B) DISMISSAL OF DIRECTORS OR EXECUTIVE OFFICERS- Require the regulated entity to dismiss from office any director or executive officer who had held office for more than 180 days immediately before the entity became undercapitalized. Dismissal under this subparagraph shall not be construed to be a removal pursuant to the Director's enforcement powers provided in section 1377.CommentsClose CommentsPermalink
`(C) EMPLOY QUALIFIED EXECUTIVE OFFICERS- Require the regulated entity to employ qualified executive officers (who, if the Director so specifies, shall be subject to approval by the Director).'; andCommentsClose CommentsPermalink
(E) by inserting at the end the following new paragraph:CommentsClose CommentsPermalink
`(8) OTHER ACTION- Require the regulated entity to take any other action that the Director determines will better carry out the purpose of this section than any of the actions specified in this paragraph.';CommentsClose CommentsPermalink
(4) by redesignating subsection (c) as subsection (d); andCommentsClose CommentsPermalink
(5) by inserting after subsection (b) the following new subsection:CommentsClose CommentsPermalink
`(c) Restriction on Compensation of Executive Officers- A regulated entity that is classified as significantly undercapitalized may not, without prior written approval by the Director--CommentsClose CommentsPermalink
`(1) pay any bonus to any executive officer; orCommentsClose CommentsPermalink
`(2) provide compensation to any executive officer at a rate exceeding that officer's average rate of compensation (excluding bonuses, stock options, and profit sharing) during the 12 calendar months preceding the calendar month in which the regulated entity became undercapitalized.'.CommentsClose CommentsPermalink
SEC. 154. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED REGULATED ENTITIES.
(a) In General- Section 1367 of the Housing and Community Development Act of 1992 (
`SEC. 1367. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED REGULATED ENTITIES.
`(a) Appointment of Agency as Conservator or Receiver-CommentsClose CommentsPermalink
`(1) IN GENERAL- Notwithstanding any other provision of Federal or State law, if any of the grounds under paragraph (3) exist, at the discretion of the Director, the Director may establish a conservatorship or receivership, as appropriate, for the purpose of reorganizing, rehabilitating, or winding up the affairs of a regulated entity.CommentsClose CommentsPermalink
`(2) APPOINTMENT- In any conservatorship or receivership established under this section, the Director shall appoint the Agency as conservator or receiver.CommentsClose CommentsPermalink
`(3) GROUNDS FOR APPOINTMENT- The grounds for appointing a conservator or receiver for a regulated entity are as follows:CommentsClose CommentsPermalink
`(A) ASSETS INSUFFICIENT FOR OBLIGATIONS- The assets of the regulated entity are less than the obligations of the regulated entity to its creditors and others.CommentsClose CommentsPermalink
`(B) SUBSTANTIAL DISSIPATION- Substantial dissipation of assets or earnings due to--CommentsClose CommentsPermalink
`(i) any violation of any provision of Federal or State law; orCommentsClose CommentsPermalink
`(ii) any unsafe or unsound practice.CommentsClose CommentsPermalink
`(C) UNSAFE OR UNSOUND CONDITION- An unsafe or unsound condition to transact business.CommentsClose CommentsPermalink
`(D) CEASE-AND-DESIST ORDERS- Any willful violation of a cease-and-desist order that has become final.CommentsClose CommentsPermalink
`(E) CONCEALMENT- Any concealment of the books, papers, records, or assets of the regulated entity, or any refusal to submit the books, papers, records, or affairs of the regulated entity, for inspection to any examiner or to any lawful agent of the Director.CommentsClose CommentsPermalink
`(F) INABILITY TO MEET OBLIGATIONS- The regulated entity is likely to be unable to pay its obligations or meet the demands of its creditors in the normal course of business.CommentsClose CommentsPermalink
`(G) LOSSES- The regulated entity has incurred or is likely to incur losses that will deplete all or substantially all of its capital, and there is no reasonable prospect for the regulated entity to become adequately capitalized (as defined in section 1364(a)(1)).CommentsClose CommentsPermalink
`(H) VIOLATIONS OF LAW- Any violation of any law or regulation, or any unsafe or unsound practice or condition that is likely to--CommentsClose CommentsPermalink
`(i) cause insolvency or substantial dissipation of assets or earnings; orCommentsClose CommentsPermalink
`(ii) weaken the condition of the regulated entity.CommentsClose CommentsPermalink
`(I) CONSENT- The regulated entity, by resolution of its board of directors or its shareholders or members, consents to the appointment.CommentsClose CommentsPermalink
`(J) UNDERCAPITALIZATION- The regulated entity is undercapitalized or significantly undercapitalized (as defined in section 1364(a)(3) or in regulations issued pursuant to section 1364(b), as applicable), and--CommentsClose CommentsPermalink
`(i) has no reasonable prospect of becoming adequately capitalized;CommentsClose CommentsPermalink
`(ii) fails to become adequately capitalized, as required by--CommentsClose CommentsPermalink
`(I) section 1365(a)(1) with respect to an undercapitalized regulated entity; orCommentsClose CommentsPermalink
`(II) section 1366(a)(1) with respect to a significantly undercapitalized regulated entity;CommentsClose CommentsPermalink
`(iii) fails to submit a capital restoration plan acceptable to the Agency within the time prescribed under section 1369C; orCommentsClose CommentsPermalink
`(iv) materially fails to implement a capital restoration plan submitted and accepted under section 1369C.CommentsClose CommentsPermalink
`(K) CRITICAL UNDERCAPITALIZATION- The regulated entity is critically undercapitalized, as defined in section 1364(a)(4) or in regulations issued pursuant to section 1364(b), as applicable.CommentsClose CommentsPermalink
`(L) MONEY LAUNDERING- The Attorney General notifies the Director in writing that the regulated entity has been found guilty of a criminal offense under section 1956 or 1957 of title 18, United States Code, or section 5322 or 5324 of title 31, United States Code.CommentsClose CommentsPermalink
`(4) MANDATORY RECEIVERSHIP-CommentsClose CommentsPermalink
`(A) IN GENERAL- The Director shall appoint the Agency as receiver for a regulated entity if the Director determines, in writing, that--CommentsClose CommentsPermalink
`(i) the assets of the regulated entity are, and during the preceding 30 calendar days have been, less than the obligations of the regulated entity to its creditors and others; orCommentsClose CommentsPermalink
`(ii) the regulated entity is not, and during the preceding 30 calendar days has not been, generally paying the debts of the regulated entity (other than debts that are the subject of a bona fide dispute) as such debts become due.CommentsClose CommentsPermalink
`(B) PERIODIC DETERMINATION REQUIRED FOR CRITICALLY UNDER CAPITALIZED REGULATED ENTITY- If a regulated entity is critically undercapitalized, the Director shall make a determination, in writing, as to whether the regulated entity meets the criteria specified in clause (i) or (ii) of subparagraph (A)--CommentsClose CommentsPermalink
`(i) not later than 30 calendar days after the regulated entity initially becomes critically undercapitalized; andCommentsClose CommentsPermalink
`(ii) at least once during each succeeding 30-calendar day period.CommentsClose CommentsPermalink
`(C) DETERMINATION NOT REQUIRED IF RECEIVERSHIP ALREADY IN PLACE- Subparagraph (B) shall not apply with respect to a regulated entity in any period during which the Agency serves as receiver for the regulated entity.CommentsClose CommentsPermalink
`(D) RECEIVERSHIP TERMINATES CONSERVATORSHIP- The appointment under this section of the Agency as receiver of a regulated entity shall immediately terminate any conservatorship established under this title for the regulated entity.CommentsClose CommentsPermalink
`(5) JUDICIAL REVIEW-CommentsClose CommentsPermalink
`(A) IN GENERAL- If the Agency is appointed conservator or receiver under this section, the regulated entity may, within 30 days of such appointment, bring an action in the United States District Court for the judicial district in which the principal place of business of such regulated entity is located, or in the United States District Court for the District of Columbia, for an order requiring the Agency to remove itself as conservator or receiver.CommentsClose CommentsPermalink
`(B) REVIEW- Upon the filing of an action under subparagraph (A), the court shall, upon the merits, dismiss such action or direct the Agency to remove itself as such conservator or receiver.CommentsClose CommentsPermalink
`(6) DIRECTORS NOT LIABLE FOR ACQUIESCING IN APPOINTMENT OF CONSERVATOR OR RECEIVER- The members of the board of directors of a regulated entity shall not be liable to the shareholders or creditors of the regulated entity for acquiescing in or consenting in good faith to the appointment of the Agency as conservator or receiver for that regulated entity.CommentsClose CommentsPermalink
`(7) AGENCY NOT SUBJECT TO ANY OTHER FEDERAL AGENCY- When acting as conservator or receiver, the Agency shall not be subject to the direction or supervision of any other agency of the United States or any State in the exercise of the rights, powers, and privileges of the Agency.CommentsClose CommentsPermalink
`(b) Powers and Duties of the Agency as Conservator or Receiver-CommentsClose CommentsPermalink
`(1) RULEMAKING AUTHORITY OF THE AGENCY- The Agency may prescribe such regulations as the Agency determines to be appropriate regarding the conduct of conservatorships or receiverships.CommentsClose CommentsPermalink
`(2) GENERAL POWERS-CommentsClose CommentsPermalink
`(A) SUCCESSOR TO REGULATED ENTITY- The Agency shall, as conservator or receiver, and by operation of law, immediately succeed to--CommentsClose CommentsPermalink
`(i) all rights, titles, powers, and privileges of the regulated entity, and of any stockholder, officer, or director of such regulated entity with respect to the regulated entity and the assets of the regulated entity; andCommentsClose CommentsPermalink
`(ii) title to the books, records, and assets of any other legal custodian of such regulated entity.CommentsClose CommentsPermalink
`(B) OPERATE THE REGULATED ENTITY- The Agency may, as conservator or receiver--CommentsClose CommentsPermalink
`(i) take over the assets of and operate the regulated entity with all the powers of the shareholders, the directors, and the officers of the regulated entity and conduct all business of the regulated entity;CommentsClose CommentsPermalink
`(ii) collect all obligations and money due the regulated entity;CommentsClose CommentsPermalink
`(iii) perform all functions of the regulated entity in the name of the regulated entity which are consistent with the appointment as conservator or receiver; andCommentsClose CommentsPermalink
`(iv) preserve and conserve the assets and property of such regulated entity.CommentsClose CommentsPermalink
`(C) FUNCTIONS OF OFFICERS, DIRECTORS, AND SHAREHOLDERS OF A REGULATED ENTITY- The Agency may, by regulation or order, provide for the exercise of any function by any stockholder, director, or officer of any regulated entity for which the Agency has been named conservator or receiver.CommentsClose CommentsPermalink
`(D) POWERS AS CONSERVATOR- The Agency may, as conservator, take such action as may be--CommentsClose CommentsPermalink
`(i) necessary to put the regulated entity in a sound and solvent condition; andCommentsClose CommentsPermalink
`(ii) appropriate to carry on the business of the regulated entity and preserve and conserve the assets and property of the regulated entity, including, if two or more Federal home loan banks have been placed in conservatorship contemporaneously, merging two or more such banks into a single Federal home loan bank.CommentsClose CommentsPermalink
`(E) ADDITIONAL POWERS AS RECEIVER- The Agency may, as receiver, place the regulated entity in liquidation and proceed to realize upon the assets of the regulated entity, having due regard to the conditions of the housing finance market.CommentsClose CommentsPermalink
`(F) ORGANIZATION OF NEW REGULATED ENTITIES- The Agency may, as receiver, organize a successor regulated entity that will operate pursuant to subsection (i).CommentsClose CommentsPermalink
`(G) TRANSFER OF ASSETS AND LIABILITIES- The Agency may, as conservator or receiver, transfer any asset or liability of the regulated entity in default without any approval, assignment, or consent with respect to such transfer. Any Federal home loan bank may, with the approval of the Agency, acquire the assets of any Bank in conservatorship or receivership, and assume the liabilities of such Bank.CommentsClose CommentsPermalink
`(H) PAYMENT OF VALID OBLIGATIONS- The Agency, as conservator or receiver, shall, to the extent of proceeds realized from the performance of contracts or sale of the assets of a regulated entity, pay all valid obligations of the regulated entity in accordance with the prescriptions and limitations of this section.CommentsClose CommentsPermalink
`(I) SUBPOENA AUTHORITY-CommentsClose CommentsPermalink
`(i) IN GENERAL-CommentsClose CommentsPermalink
`(I) IN GENERAL- The Agency may, as conservator or receiver, and for purposes of carrying out any power, authority, or duty with respect to a regulated entity (including determining any claim against the regulated entity and determining and realizing upon any asset of any person in the course of collecting money due the regulated entity), exercise any power established under section 1348.CommentsClose CommentsPermalink
`(II) APPLICABILITY OF LAW- The provisions of section 1348 shall apply with respect to the exercise of any power exercised under this subparagraph in the same manner as such provisions apply under that section.CommentsClose CommentsPermalink
`(ii) AUTHORITY OF DIRECTOR- A subpoena or subpoena duces tecum may be issued under clause (i) only by, or with the written approval of, the Director, or the designee of the Director.CommentsClose CommentsPermalink
`(iii) RULE OF CONSTRUCTION- This subsection shall not be construed to limit any rights that the Agency, in any capacity, might otherwise have under section 1317 or 1379D.CommentsClose CommentsPermalink
`(J) CONTRACTING FOR SERVICES- The Agency may, as conservator or receiver, provide by contract for the carrying out of any of its functions, activities, actions, or duties as conservator or receiver.CommentsClose CommentsPermalink
`(K) INCIDENTAL POWERS- The Agency may, as conservator or receiver--CommentsClose CommentsPermalink
`(i) exercise all powers and authorities specifically granted to conservators or receivers, respectively, under this section, and such incidental powers as shall be necessary to carry out such powers; andCommentsClose CommentsPermalink
`(ii) take any action authorized by this section, which the Agency determines is in the best interests of the regulated entity or the Agency.CommentsClose CommentsPermalink
`(3) AUTHORITY OF RECEIVER TO DETERMINE CLAIMS-CommentsClose CommentsPermalink
`(A) IN GENERAL- The Agency may, as receiver, determine claims in accordance with the requirements of this subsection and any regulations prescribed under paragraph (4).CommentsClose CommentsPermalink
`(B) NOTICE REQUIREMENTS- The receiver, in any case involving the liquidation or winding up of the affairs of a closed regulated entity, shall--CommentsClose CommentsPermalink
`(i) promptly publish a notice to the creditors of the regulated entity to present their claims, together with proof, to the receiver by a date specified in the notice which shall be not less than 90 days after the publication of such notice; andCommentsClose CommentsPermalink
`(ii) republish such notice approximately 1 month and 2 months, respectively, after the publication under clause (i).CommentsClose CommentsPermalink
`(C) MAILING REQUIRED- The receiver shall mail a notice similar to the notice published under subparagraph (B)(i) at the time of such publication to any creditor shown on the books of the regulated entity--CommentsClose CommentsPermalink
`(i) at the last address of the creditor appearing in such books; orCommentsClose CommentsPermalink
`(ii) upon discovery of the name and address of a claimant not appearing on the books of the regulated entity within 30 days after the discovery of such name and address.CommentsClose CommentsPermalink
`(4) RULEMAKING AUTHORITY RELATING TO DETERMINATION OF CLAIMS- Subject to subsection (c), the Director may prescribe regulations regarding the allowance or disallowance of claims by the receiver and providing for administrative determination of claims and review of such determination.CommentsClose CommentsPermalink
`(5) PROCEDURES FOR DETERMINATION OF CLAIMS-CommentsClose CommentsPermalink
`(A) DETERMINATION PERIOD-CommentsClose CommentsPermalink
`(i) IN GENERAL- Before the end of the 180-day period beginning on the date on which any claim against a regulated entity is filed with the Agency as receiver, the Agency shall determine whether to allow or disallow the claim and shall notify the claimant of any determination with respect to such claim.CommentsClose CommentsPermalink
`(ii) EXTENSION OF TIME- The period described in clause (i) may be extended by a written agreement between the claimant and the Agency.CommentsClose CommentsPermalink
`(iii) MAILING OF NOTICE SUFFICIENT- The notification requirements of clause (i) shall be deemed to be satisfied if the notice of any determination with respect to any claim is mailed to the last address of the claimant which appears--CommentsClose CommentsPermalink
`(I) on the books of the regulated entity;CommentsClose CommentsPermalink
`(II) in the claim filed by the claimant; orCommentsClose CommentsPermalink
`(III) in documents submitted in proof of the claim.CommentsClose CommentsPermalink
`(iv) CONTENTS OF NOTICE OF DISALLOWANCE- If any claim filed under clause (i) is disallowed, the notice to the claimant shall contain--CommentsClose CommentsPermalink
`(I) a statement of each reason for the disallowance; andCommentsClose CommentsPermalink
`(II) the procedures available for obtaining agency review of the determination to disallow the claim or judicial determination of the claim.CommentsClose CommentsPermalink
`(B) ALLOWANCE OF PROVEN CLAIM- The receiver shall allow any claim received on or before the date specified in the notice published under paragraph (3)(B)(i), or the date specified in the notice required under paragraph (3)(C), which is proved to the satisfaction of the receiver.CommentsClose CommentsPermalink
`(C) DISALLOWANCE OF CLAIMS FILED AFTER END OF FILING PERIOD- Claims filed after the date specified in the notice published under paragraph (3)(B)(i), or the date specified under paragraph (3)(C), shall be disallowed and such disallowance shall be final.CommentsClose CommentsPermalink
`(D) AUTHORITY TO DISALLOW CLAIMS-CommentsClose CommentsPermalink
`(i) IN GENERAL- The receiver may disallow any portion of any claim by a creditor or claim of security, preference, or priority which is not proved to the satisfaction of the receiver.CommentsClose CommentsPermalink
`(ii) PAYMENTS TO LESS THAN FULLY SECURED CREDITORS- In the case of a claim of a creditor against a regulated entity which is secured by any property or other asset of such regulated entity, the receiver--CommentsClose CommentsPermalink
`(I) may treat the portion of such claim which exceeds an amount equal to the fair market value of such property or other asset as an unsecured claim against the regulated entity; andCommentsClose CommentsPermalink
`(II) may not make any payment with respect to such unsecured portion of the claim other than in connection with the disposition of all claims of unsecured creditors of the regulated entity.CommentsClose CommentsPermalink
`(iii) EXCEPTIONS- No provision of this paragraph shall apply with respect to any extension of credit from any Federal Reserve Bank, Federal home loan bank, or the Treasury of the United States.CommentsClose CommentsPermalink
`(E) NO JUDICIAL REVIEW OF DETERMINATION PURSUANT TO SUBPARAGRAPH (D)- No court may review the determination of the Agency under subparagraph (D) to disallow a claim. This subparagraph shall not affect the authority of a claimant to obtain de novo judicial review of a claim pursuant to paragraph (6).CommentsClose CommentsPermalink
`(F) LEGAL EFFECT OF FILING-CommentsClose CommentsPermalink
`(i) STATUTE OF LIMITATION TOLLED- For purposes of any applicable statute of limitations, the filing of a claim with the receiver shall constitute a commencement of an action.CommentsClose CommentsPermalink
`(ii) NO PREJUDICE TO OTHER ACTIONS- Subject to paragraph (10), the filing of a claim with the receiver shall not prejudice any right of the claimant to continue any action which was filed before the date of the appointment of the receiver, subject to the determination of claims by the receiver.CommentsClose CommentsPermalink
`(6) PROVISION FOR JUDICIAL DETERMINATION OF CLAIMS-CommentsClose CommentsPermalink
`(A) IN GENERAL- The claimant may file suit on a claim (or continue an action commenced before the appointment of the receiver) in the district or territorial court of the United States for the district within which the principal place of business of the regulated entity is located or the United States District Court for the District of Columbia (and such court shall have jurisdiction to hear such claim), before the end of the 60-day period beginning on the earlier of--CommentsClose CommentsPermalink
`(i) the end of the period described in paragraph (5)(A)(i) with respect to any claim against a regulated entity for which the Agency is receiver; orCommentsClose CommentsPermalink
`(ii) the date of any notice of disallowance of such claim pursuant to paragraph (5)(A)(i).CommentsClose CommentsPermalink
`(B) STATUTE OF LIMITATIONS- A claim shall be deemed to be disallowed (other than any portion of such claim which was allowed by the receiver), and such disallowance shall be final, and the claimant shall have no further rights or remedies with respect to such claim, if the claimant fails, before the end of the 60-day period described under subparagraph (A), to file suit on such claim (or continue an action commenced before the appointment of the receiver).CommentsClose CommentsPermalink
`(7) REVIEW OF CLAIMS-CommentsClose CommentsPermalink
`(A) OTHER REVIEW PROCEDURES-CommentsClose CommentsPermalink
`(i) IN GENERAL- The Agency shall establish such alternative dispute resolution processes as may be appropriate for the resolution of claims filed under paragraph (5)(A)(i).CommentsClose CommentsPermalink
`(ii) CRITERIA- In establishing alternative dispute resolution processes, the Agency shall strive for procedures which are expeditious, fair, independent, and low cost.CommentsClose CommentsPermalink
`(iii) VOLUNTARY BINDING OR NONBINDING PROCEDURES- The Agency may establish both binding and nonbinding processes, which may be conducted by any government or private party. All parties, including the claimant and the Agency, must agree to the use of the process in a particular case.CommentsClose CommentsPermalink
`(B) CONSIDERATION OF INCENTIVES- The Agency shall seek to develop incentives for claimants to participate in the alternative dispute resolution process.CommentsClose CommentsPermalink
`(8) EXPEDITED DETERMINATION OF CLAIMS-CommentsClose CommentsPermalink
`(A) ESTABLISHMENT REQUIRED- The Agency shall establish a procedure for expedited relief outside of the routine claims process established under paragraph (5) for claimants who--CommentsClose CommentsPermalink
`(i) allege the existence of legally valid and enforceable or perfected security interests in assets of any regulated entity for which the Agency has been appointed receiver; andCommentsClose CommentsPermalink
`(ii) allege that irreparable injury will occur if the routine claims procedure is followed.CommentsClose CommentsPermalink
`(B) DETERMINATION PERIOD- Before the end of the 90-day period beginning on the date any claim is filed in accordance with the procedures established under subparagraph (A), the Director shall--CommentsClose CommentsPermalink
`(i) determine--CommentsClose CommentsPermalink
`(I) whether to allow or disallow such claim; orCommentsClose CommentsPermalink
`(II) whether such claim should be determined pursuant to the procedures established under paragraph (5); andCommentsClose CommentsPermalink
`(ii) notify the claimant of the determination, and if the claim is disallowed, provide a statement of each reason for the disallowance and the procedure for obtaining agency review or judicial determination.CommentsClose CommentsPermalink
`(C) PERIOD FOR FILING OR RENEWING SUIT- Any claimant who files a request for expedited relief shall be permitted to file a suit, or to continue a suit filed before the appointment of the receiver, seeking a determination of the rights of the claimant with respect to such security interest after the earlier of--CommentsClose CommentsPermalink
`(i) the end of the 90-day period beginning on the date of the filing of a request for expedited relief; orCommentsClose CommentsPermalink
`(ii) the date the Agency denies the claim.CommentsClose CommentsPermalink
`(D) STATUTE OF LIMITATIONS- If an action described under subparagraph (C) is not filed, or the motion to renew a previously filed suit is not made, before the end of the 30-day period beginning on the date on which such action or motion may be filed under subparagraph (B), the claim shall be deemed to be disallowed as of the end of such period (other than any portion of such claim which was allowed by the receiver), such disallowance shall be final, and the claimant shall have no further rights or remedies with respect to such claim.CommentsClose CommentsPermalink
`(E) LEGAL EFFECT OF FILING-CommentsClose CommentsPermalink
`(i) STATUTE OF LIMITATION TOLLED- For purposes of any applicable statute of limitations, the filing of a claim with the receiver shall constitute a commencement of an action.CommentsClose CommentsPermalink
`(ii) NO PREJUDICE TO OTHER ACTIONS- Subject to paragraph (10), the filing of a claim with the receiver shall not prejudice any right of the claimant to continue any action that was filed before the appointment of the receiver, subject to the determination of claims by the receiver.CommentsClose CommentsPermalink
`(9) PAYMENT OF CLAIMS-CommentsClose CommentsPermalink
`(A) IN GENERAL- The receiver may, in the discretion of the receiver, and to the extent funds are available from the assets of the regulated entity, pay creditor claims, in such manner and amounts as are authorized under this section, which are--CommentsClose CommentsPermalink
`(i) allowed by the receiver;CommentsClose CommentsPermalink
`(ii) approved by the Agency pursuant to a final determination pursuant to paragraph (7) or (8); orCommentsClose CommentsPermalink
`(iii) determined by the final judgment of any court of competent jurisdiction.CommentsClose CommentsPermalink
`(B) AGREEMENTS AGAINST THE INTEREST OF THE AGENCY- No agreement that tends to diminish or defeat the interest of the Agency in any asset acquired by the Agency as receiver under this section shall be valid against the Agency unless such agreement is in writing, and executed by an authorized official of the regulated entity, except that such requirements for qualified financial contracts shall be applied in a manner consistent with reasonable business trading practices in the financial contracts market.CommentsClose CommentsPermalink
`(C) PAYMENT OF DIVIDENDS ON CLAIMS- The receiver may, in the sole discretion of the receiver, pay from the assets of the regulated entity dividends on proved claims at any time, and no liability shall attach to the Agency, by reason of any such payment, for failure to pay dividends to a claimant whose claim is not proved at the time of any such payment.CommentsClose CommentsPermalink
`(D) RULEMAKING AUTHORITY OF THE DIRECTOR- The Director may prescribe such rules, including definitions of terms, as the Director deems appropriate to establish a single uniform interest rate for, or to make payments of post-insolvency interest to creditors holding proven claims against the receivership estates of regulated entities following satisfaction by the receiver of the principal amount of all creditor claims.CommentsClose CommentsPermalink
`(10) SUSPENSION OF LEGAL ACTIONS-CommentsClose CommentsPermalink
`(A) IN GENERAL- After the appointment of a conservator or receiver for a regulated entity, the conservator or receiver may, in any judicial action or proceeding to which such regulated entity is or becomes a party, request a stay for a period not to exceed--CommentsClose CommentsPermalink
`(i) 45 days, in the case of any conservator; andCommentsClose CommentsPermalink
`(ii) 90 days, in the case of any receiver.CommentsClose CommentsPermalink
`(B) GRANT OF STAY BY ALL COURTS REQUIRED- Upon receipt of a request by any conservator or receiver under subparagraph (A) for a stay of any judicial action or proceeding in any court with jurisdiction of such action or proceeding, the court shall grant such stay as to all parties.CommentsClose CommentsPermalink
`(11) ADDITIONAL RIGHTS AND DUTIES-CommentsClose CommentsPermalink
`(A) PRIOR FINAL ADJUDICATION- The Agency shall abide by any final unappealable judgment of any court of competent jurisdiction which was rendered before the appointment of the Agency as conservator or receiver.CommentsClose CommentsPermalink
`(B) RIGHTS AND REMEDIES OF CONSERVATOR OR RECEIVER- In the event of any appealable judgment, the Agency as conservator or receiver shall--CommentsClose CommentsPermalink
`(i) have all the rights and remedies available to the regulated entity (before the appointment of such conservator or receiver) and the Agency, including removal to Federal court and all appellate rights; andCommentsClose CommentsPermalink
`(ii) not be required to post any bond in order to pursue such remedies.CommentsClose CommentsPermalink
`(C) NO ATTACHMENT OR EXECUTION- No attachment or execution may issue by any court upon assets in the possession of the receiver.CommentsClose CommentsPermalink
`(D) LIMITATION ON JUDICIAL REVIEW- Except as otherwise provided in this subsection, no court shall have jurisdiction over--CommentsClose CommentsPermalink
`(i) any claim or action for payment from, or any action seeking a determination of rights with respect to, the assets of any regulated entity for which the Agency has been appointed receiver; orCommentsClose CommentsPermalink
`(ii) any claim relating to any act or omission of such regulated entity or the Agency as receiver.CommentsClose CommentsPermalink
`(E) DISPOSITION OF ASSETS- In exercising any right, power, privilege, or authority as conservator or receiver in connection with any sale or disposition of assets of a regulated entity for which the Agency has been appointed conservator or receiver, the Agency shall conduct its operations in a manner which maintains stability in the housing finance markets and, to the extent consistent with that goal--CommentsClose CommentsPermalink
`(i) maximizes the net present value return from the sale or disposition of such assets;CommentsClose CommentsPermalink
`(ii) minimizes the amount of any loss realized in the resolution of cases; andCommentsClose CommentsPermalink
`(iii) ensures adequate competition and fair and consistent treatment of offerors.CommentsClose CommentsPermalink
`(12) STATUTE OF LIMITATIONS FOR ACTIONS BROUGHT BY CONSERVATOR OR RECEIVER-CommentsClose CommentsPermalink
`(A) IN GENERAL- Notwithstanding any provision of any contract, the applicable statute of limitations with regard to any action brought by the Agency as conservator or receiver shall be--CommentsClose CommentsPermalink
`(i) in the case of any contract claim, the longer of--CommentsClose CommentsPermalink
`(I) the 6-year period beginning on the date the claim accrues; orCommentsClose CommentsPermalink
`(II) the period applicable under State law; andCommentsClose CommentsPermalink
`(ii) in the case of any tort claim, the longer of--CommentsClose CommentsPermalink
`(I) the 3-year period beginning on the date the claim accrues; orCommentsClose CommentsPermalink
`(II) the period applicable under State law.CommentsClose CommentsPermalink
`(B) DETERMINATION OF THE DATE ON WHICH A CLAIM ACCRUES- For purposes of subparagraph (A), the date on which the statute of limitations begins to run on any claim described in such subparagraph shall be the later of--CommentsClose CommentsPermalink
`(i) the date of the appointment of the Agency as conservator or receiver; orCommentsClose CommentsPermalink
`(ii) the date on which the cause of action accrues.CommentsClose CommentsPermalink
`(13) REVIVAL OF EXPIRED STATE CAUSES OF ACTION-CommentsClose CommentsPermalink
`(A) IN GENERAL- In the case of any tort claim described under subparagraph (B) for which the statute of limitations applicable under State law with respect to such claim has expired not more than 5 years before the appointment of the Agency as conservator or receiver, the Agency may bring an action as conservator or receiver on such claim without regard to the expiration of the statute of limitation applicable under State law.CommentsClose CommentsPermalink
`(B) CLAIMS DESCRIBED- A tort claim referred to under subparagraph (A) is a claim arising from fraud, intentional misconduct resulting in unjust enrichment, or intentional misconduct resulting in substantial loss to the regulated entity.CommentsClose CommentsPermalink
`(14) ACCOUNTING AND RECORDKEEPING REQUIREMENTS-CommentsClose CommentsPermalink
`(A) IN GENERAL- The Agency as conservator or receiver shall, consistent with the accounting and reporting practices and procedures established by the Agency, maintain a full accounting of each conservatorship and receivership or other disposition of a regulated entity in default.CommentsClose CommentsPermalink
`(B) ANNUAL ACCOUNTING OR REPORT- With respect to each conservatorship or receivership, the Agency shall make an annual accounting or report available to the Board, the Comptroller General of the United States, the Committee on Banking, Housing, and Urban Affairs of the Senate, and the Committee on Financial Services of the House of Representatives.CommentsClose CommentsPermalink
`(C) AVAILABILITY OF REPORTS- Any report prepared under subparagraph (B) shall be made available by the Agency upon request to any shareholder of a regulated entity or any member of the public.CommentsClose CommentsPermalink
`(D) RECORDKEEPING REQUIREMENT- After the end of the 6-year period beginning on the date that the conservatorship or receivership is terminated by the Director, the Agency may destroy any records of such regulated entity which the Agency, in the discretion of the Agency, determines to be unnecessary unless directed not to do so by a court of competent jurisdiction or governmental agency, or prohibited by law.CommentsClose CommentsPermalink
`(15) FRAUDULENT TRANSFERS-CommentsClose CommentsPermalink
`(A) IN GENERAL- The Agency, as conservator or receiver, may avoid a transfer of any interest of a regulated entity-affiliated party, or any person who the conservator or receiver determines is a debtor of the regulated entity, in property, or any obligation incurred by such party or person, that was made within 5 years of the date on which the Agency was appointed conservator or receiver, if such party or person voluntarily or involuntarily made such transfer or incurred such liability with the intent to hinder, delay, or defraud the regulated entity, the Agency, the conservator, or receiver.CommentsClose CommentsPermalink
`(B) RIGHT OF RECOVERY- To the extent a transfer is avoided under subparagraph (A), the conservator or receiver may recover, for the benefit of the regulated entity, the property transferred, or, if a court so orders, the value of such property (at the time of such transfer) from--CommentsClose CommentsPermalink
`(i) the initial transferee of such transfer or the regulated entity-affiliated party or person for whose benefit such transfer was made; orCommentsClose CommentsPermalink
`(ii) any immediate or mediate transferee of any such initial transferee.CommentsClose CommentsPermalink
`(C) RIGHTS OF TRANSFEREE OR OBLIGEE- The conservator or receiver may not recover under subparagraph (B) from--CommentsClose CommentsPermalink
`(i) any transferee that takes for value, including satisfaction or securing of a present or antecedent debt, in good faith; orCommentsClose CommentsPermalink
`(ii) any immediate or mediate good faith transferee of such transferee.CommentsClose CommentsPermalink
`(D) RIGHTS UNDER THIS PARAGRAPH- The rights under this paragraph of the conservator or receiver described under subparagraph (A) shall be superior to any rights of a trustee or any other party (other than any party which is a Federal agency) under title 11, United States Code.CommentsClose CommentsPermalink
`(16) ATTACHMENT OF ASSETS AND OTHER INJUNCTIVE RELIEF- Subject to paragraph (17), any court of competent jurisdiction may, at the request of the conservator or receiver, issue an order in accordance with Rule 65 of the Federal Rules of Civil Procedure, including an order placing the assets of any person designated by the Agency or such conservator under the control of the court, and appointing a trustee to hold such assets.CommentsClose CommentsPermalink
`(17) STANDARDS OF PROOF- Rule 65 of the Federal Rules of Civil Procedure shall apply with respect to any proceeding under paragraph (16) without regard to the requirement of such rule that the applicant show that the injury, loss, or damage is irreparable and immediate.CommentsClose CommentsPermalink
`(18) TREATMENT OF CLAIMS ARISING FROM BREACH OF CONTRACTS EXECUTED BY THE RECEIVER OR CONSERVATOR-CommentsClose CommentsPermalink
`(A) IN GENERAL- Notwithstanding any other provision of this subsection, any final and unappealable judgment for monetary damages entered against a receiver or conservator for the breach of an agreement executed or approved in writing by such receiver or conservator after the date of its appointment, shall be paid as an administrative expense of the receiver or conservator.CommentsClose CommentsPermalink
`(B) NO LIMITATION OF POWER- Nothing in this paragraph shall be construed to limit the power of a receiver or conservator to exercise any rights under contract or law, including to terminate, breach, cancel, or otherwise discontinue such agreement.CommentsClose CommentsPermalink
`(19) GENERAL EXCEPTIONS-CommentsClose CommentsPermalink
`(A) LIMITATIONS- The rights of a conservator or receiver appointed under this section shall be subject to the limitations on the powers of a receiver under sections 402 through 407 of the Federal Deposit Insurance Corporation Improvement Act of 1991 (
`(B) MORTGAGES HELD IN TRUST-CommentsClose CommentsPermalink
`(i) IN GENERAL- Any mortgage, pool of mortgages, or interest in a pool of mortgages, held in trust, custodial, or agency capacity by a regulated entity for the benefit of persons other than the regulated entity shall not be available to satisfy the claims of creditors generally.CommentsClose CommentsPermalink
`(ii) HOLDING OF MORTGAGES- Any mortgage, pool of mortgages, or interest in a pool of mortgages, described under clause (i) shall be held by the conservator or receiver appointed under this section for the beneficial owners of such mortgage, pool of mortgages, or interest in a pool of mortgages in accordance with the terms of the agreement creating such trust, custodial, or other agency arrangement.CommentsClose CommentsPermalink
`(iii) LIABILITY OF RECEIVER- The liability of a receiver appointed under this section for damages shall, in the case of any contingent or unliquidated claim relating to the mortgages held in trust, be estimated in accordance set forth in the regulations of the Director.CommentsClose CommentsPermalink
`(c) Priority of Expenses and Unsecured Claims-CommentsClose CommentsPermalink
`(1) IN GENERAL- Unsecured claims against a regulated entity, or a receiver, that are proven to the satisfaction of the receiver shall have priority in the following order:CommentsClose CommentsPermalink
`(A) Administrative expenses of the receiver.CommentsClose CommentsPermalink
`(B) Any other general or senior liability of the regulated entity and claims of other Federal home loan banks arising from their payment obligations (including joint and several payment obligations).CommentsClose CommentsPermalink
`(C) Any obligation subordinated to general creditors.CommentsClose CommentsPermalink
`(D) Any obligation to shareholders or members arising as a result of their status as shareholder or members.CommentsClose CommentsPermalink
`(2) CREDITORS SIMILARLY SITUATED- All creditors that are similarly situated under paragraph (1) shall be treated in a similar manner, except that the Agency may make such other payments to creditors necessary to maximize the present value return from the sale or disposition or such regulated entity's assets or to minimize the amount of any loss realized in the resolution of cases so long as all creditors similarly situated receive not less than the amount provided under subsection (e)(2).CommentsClose CommentsPermalink
`(3) DEFINITION- The term `administrative expenses of the receiver' shall include the actual, necessary costs and expenses incurred by the receiver in preserving the assets of the regulated entity or liquidating or otherwise resolving the affairs of the regulated entity. Such expenses shall include obligations that are incurred by the receiver after appointment as receiver that the Director determines are necessary and appropriate to facilitate the smooth and orderly liquidation or other resolution of the regulated entity.CommentsClose CommentsPermalink
`(d) Provisions Relating to Contracts Entered Into Before Appointment of Conservator or Receiver-CommentsClose CommentsPermalink
`(1) AUTHORITY TO REPUDIATE CONTRACTS- In addition to any other rights a conservator or receiver may have, the conservator or receiver for any regulated entity may disaffirm or repudiate any contract or lease--CommentsClose CommentsPermalink
`(A) to which such regulated entity is a party;CommentsClose CommentsPermalink
`(B) the performance of which the conservator or receiver, in its sole discretion, determines to be burdensome; andCommentsClose CommentsPermalink
`(C) the disaffirmance or repudiation of which the conservator or receiver determines, in its sole discretion, will promote the orderly administration of the affairs of the regulated entity.CommentsClose CommentsPermalink
`(2) TIMING OF REPUDIATION- The conservator or receiver shall determine whether or not to exercise the rights of repudiation under this subsection within a reasonable period following such appointment.CommentsClose CommentsPermalink
`(3) CLAIMS FOR DAMAGES FOR REPUDIATION-CommentsClose CommentsPermalink
`(A) IN GENERAL- Except as otherwise provided under subparagraph (C) and paragraphs (4), (5), and (6), the liability of the conservator or receiver for the disaffirmance or repudiation of any contract pursuant to paragraph (1) shall be--CommentsClose CommentsPermalink
`(i) limited to actual direct compensatory damages; andCommentsClose CommentsPermalink
`(ii) determined as of--CommentsClose CommentsPermalink
`(I) the date of the appointment of the conservator or receiver; orCommentsClose CommentsPermalink
`(II) in the case of any contract or agreement referred to in paragraph (8), the date of the disaffirmance or repudiation of such contract or agreement.CommentsClose CommentsPermalink
`(B) NO LIABILITY FOR OTHER DAMAGES- For purposes of subparagraph (A), the term `actual direct compensatory damages' shall not include--CommentsClose CommentsPermalink
`(i) punitive or exemplary damages;CommentsClose CommentsPermalink
`(ii) damages for lost profits or opportunity; orCommentsClose CommentsPermalink
`(iii) damages for pain and suffering.CommentsClose CommentsPermalink
`(C) MEASURE OF DAMAGES FOR REPUDIATION OF FINANCIAL CONTRACTS- In the case of any qualified financial contract or agreement to which paragraph (8) applies, compensatory damages shall be--CommentsClose CommentsPermalink
`(i) deemed to include normal and reasonable costs of cover or other reasonable measures of damages utilized in the industries for such contract and agreement claims; andCommentsClose CommentsPermalink
`(ii) paid in accordance with this subsection and subsection (e), except as otherwise specifically provided in this section.CommentsClose CommentsPermalink
`(4) LEASES UNDER WHICH THE REGULATED ENTITY IS THE LESSEE-CommentsClose CommentsPermalink
`(A) IN GENERAL- If the conservator or receiver disaffirms or repudiates a lease under which the regulated entity was the lessee, the conservator or receiver shall not be liable for any damages (other than damages determined under subparagraph (B)) for the disaffirmance or repudiation of such lease.CommentsClose CommentsPermalink
`(B) PAYMENTS OF RENT- Notwithstanding subparagraph (A), the lessor under a lease to which that subparagraph applies shall--CommentsClose CommentsPermalink
`(i) be entitled to the contractual rent accruing before the later of the date--CommentsClose CommentsPermalink
`(I) the notice of disaffirmance or repudiation is mailed; orCommentsClose CommentsPermalink
`(II) the disaffirmance or repudiation becomes effective, unless the lessor is in default or breach of the terms of the lease;CommentsClose CommentsPermalink
`(ii) have no claim for damages under any acceleration clause or other penalty provision in the lease; andCommentsClose CommentsPermalink
`(iii) have a claim for any unpaid rent, subject to all appropriate offsets and defenses, due as of the date of the appointment, which shall be paid in accordance with this subsection and subsection (e).CommentsClose CommentsPermalink
`(5) LEASES UNDER WHICH THE REGULATED ENTITY IS THE LESSOR-CommentsClose CommentsPermalink
`(A) IN GENERAL- If the conservator or receiver repudiates an unexpired written lease of real property of the regulated entity under which the regulated entity is the lessor and the lessee is not, as of the date of such repudiation, in default, the lessee under such lease may either--CommentsClose CommentsPermalink
`(i) treat the lease as terminated by such repudiation; orCommentsClose CommentsPermalink
`(ii) remain in possession of the leasehold interest for the balance of the term of the lease, unless the lessee defaults under the terms of the lease after the date of such repudiation.CommentsClose CommentsPermalink
`(B) PROVISIONS APPLICABLE TO LESSEE REMAINING IN POSSESSION- If any lessee under a lease described under subparagraph (A) remains in possession of a leasehold interest under clause (ii) of such subparagraph--CommentsClose CommentsPermalink
`(i) the lessee--CommentsClose CommentsPermalink
`(I) shall continue to pay the contractual rent pursuant to the terms of the lease after the date of the repudiation of such lease; andCommentsClose CommentsPermalink
`(II) may offset against any rent payment which accrues after the date of the repudiation of the lease, and any damages which accrue after such date due to the nonperformance of any obligation of the regulated entity under the lease after such date; andCommentsClose CommentsPermalink
`(ii) the conservator or receiver shall not be liable to the lessee for any damages arising after such date as a result of the repudiation other than the amount of any offset allowed under clause (i)(II).CommentsClose CommentsPermalink
`(6) CONTRACTS FOR THE SALE OF REAL PROPERTY-CommentsClose CommentsPermalink
`(A) IN GENERAL- If the conservator or receiver repudiates any contract for the sale of real property and the purchaser of such real property under such contract is in possession, and is not, as of the date of such repudiation, in default, such purchaser may either--CommentsClose CommentsPermalink
`(i) treat the contract as terminated by such repudiation; orCommentsClose CommentsPermalink
`(ii) remain in possession of such real property.CommentsClose CommentsPermalink
`(B) PROVISIONS APPLICABLE TO PURCHASER REMAINING IN POSSESSION- If any purchaser of real property under any contract described under subparagraph (A) remains in possession of such property under clause (ii) of such subparagraph--CommentsClose CommentsPermalink
`(i) the purchaser--CommentsClose CommentsPermalink
`(I) shall continue to make all payments due under the contract after the date of the repudiation of the contract; andCommentsClose CommentsPermalink
`(II) may offset against any such payments any damages which accrue after such date due to the nonperformance (after such date) of any obligation of the regulated entity under the contract; andCommentsClose CommentsPermalink
`(ii) the conservator or receiver shall--CommentsClose CommentsPermalink
`(I) not be liable to the purchaser for any damages arising after such date as a result of the repudiation other than the amount of any offset allowed under clause (i)(II);CommentsClose CommentsPermalink
`(II) deliver title to the purchaser in accordance with the provisions of the contract; andCommentsClose CommentsPermalink
`(III) have no obligation under the contract other than the performance required under subclause (II).CommentsClose CommentsPermalink
`(C) ASSIGNMENT AND SALE ALLOWED-CommentsClose CommentsPermalink
`(i) IN GENERAL- No provision of this paragraph shall be construed as limiting the right of the conservator or receiver to assign the contract described under subparagraph (A), and sell the property subject to the contract and the provisions of this paragraph.CommentsClose CommentsPermalink
`(ii) NO LIABILITY AFTER ASSIGNMENT AND SALE- If an assignment and sale described under clause (i) is consummated, the conservator or receiver shall have no further liability under the contract described under subparagraph (A), or with respect to the real property which was the subject of such contract.CommentsClose CommentsPermalink
`(7) PROVISIONS APPLICABLE TO SERVICE CONTRACTS-CommentsClose CommentsPermalink
`(A) SERVICES PERFORMED BEFORE APPOINTMENT- In the case of any contract for services between any person and any regulated entity for which the Agency has been appointed conservator or receiver, any claim of such person for services performed before the appointment of the conservator or the receiver shall be--CommentsClose CommentsPermalink
`(i) a claim to be paid in accordance with subsections (b) and (e); andCommentsClose CommentsPermalink
`(ii) deemed to have arisen as of the date the conservator or receiver was appointed.CommentsClose CommentsPermalink
`(B) SERVICES PERFORMED AFTER APPOINTMENT AND PRIOR TO REPUDIATION- If, in the case of any contract for services described under subparagraph (A), the conservator or receiver accepts performance by the other person before the conservator or receiver makes any determination to exercise the right of repudiation of such contract under this section--CommentsClose CommentsPermalink
`(i) the other party shall be paid under the terms of the contract for the services performed; andCommentsClose CommentsPermalink
`(ii) the amount of such payment shall be treated as an administrative expense of the conservatorship or receivership.CommentsClose CommentsPermalink
`(C) ACCEPTANCE OF PERFORMANCE NO BAR TO SUBSEQUENT REPUDIATION- The acceptance by any conservator or receiver of services referred to under subparagraph (B) in connection with a contract described in such subparagraph shall not affect the right of the conservator or receiver to repudiate such contract under this section at any time after such performance.CommentsClose CommentsPermalink
`(8) CERTAIN QUALIFIED FINANCIAL CONTRACTS-CommentsClose CommentsPermalink
`(A) RIGHTS OF PARTIES TO CONTRACTS- Subject to paragraphs (9) and (10) and notwithstanding any other provision of this Act, any other Federal law, or the law of any State, no person shall be stayed or prohibited from exercising--CommentsClose CommentsPermalink
`(i) any right such person has to cause the termination, liquidation, or acceleration of any qualified financial contract with a regulated entity that arises upon the appointment of the Agency as receiver for such regulated entity at any time after such appointment;CommentsClose CommentsPermalink
`(ii) any right under any security agreement or arrangement or other credit enhancement relating to one or more qualified financial contracts described in clause (i); orCommentsClose CommentsPermalink
`(iii) any right to offset or net out any termination value, payment amount, or other transfer obligation arising under or in connection with 1 or more contracts and agreements described in clause (i), including any master agreement for such contracts or agreements.CommentsClose CommentsPermalink
`(B) APPLICABILITY OF OTHER PROVISIONS- Paragraph (10) of subsection (b) shall apply in the case of any judicial action or proceeding brought against any receiver referred to under subparagraph (A), or the regulated entity for which such receiver was appointed, by any party to a contract or agreement described under subparagraph (A)(i) with such regulated entity.CommentsClose CommentsPermalink
`(C) CERTAIN TRANSFERS NOT AVOIDABLE-CommentsClose CommentsPermalink
`(i) IN GENERAL- Notwithstanding paragraph (11) or any other Federal or State laws relating to the avoidance of preferential or fraudulent transfers, the Agency, whether acting as such or as conservator or receiver of a regulated entity, may not avoid any transfer of money or other property in connection with any qualified financial contract with a regulated entity.CommentsClose CommentsPermalink
`(ii) EXCEPTION FOR CERTAIN TRANSFERS- Clause (i) shall not apply to any transfer of money or other property in connection with any qualified financial contract with a regulated entity if the Agency determines that the transferee had actual intent to hinder, delay, or defraud such regulated entity, the creditors of such regulated entity, or any conservator or receiver appointed for such regulated entity.CommentsClose CommentsPermalink
`(D) CERTAIN CONTRACTS AND AGREEMENTS DEFINED- In this subsection:CommentsClose CommentsPermalink
`(i) QUALIFIED FINANCIAL CONTRACT- The term `qualified financial contract' means any securities contract, commodity contract, forward contract, repurchase agreement, swap agreement, and any similar agreement that the Agency determines by regulation, resolution, or order to be a qualified financial contract for purposes of this paragraph.CommentsClose CommentsPermalink
`(ii) SECURITIES CONTRACT- The term `securities contract'--CommentsClose CommentsPermalink
`(I) means a contract for the purchase, sale, or loan of a security, a certificate of deposit, a mortgage loan, or any interest in a mortgage loan, a group or index of securities, certificates of deposit, or mortgage loans or interests therein (including any interest therein or based on the value thereof) or any option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option, and including any repurchase or reverse repurchase transaction on any such security, certificate of deposit, mortgage loan, interest, group or index, or option;CommentsClose CommentsPermalink
`(II) does not include any purchase, sale, or repurchase obligation under a participation in a commercial mortgage loan unless the Agency determines by regulation, resolution, or order to include any such agreement within the meaning of such term;CommentsClose CommentsPermalink
`(III) means any option entered into on a national securities exchange relating to foreign currencies;CommentsClose CommentsPermalink
`(IV) means the guarantee by or to any securities clearing agency of any settlement of cash, securities, certificates of deposit, mortgage loans or interests therein, group or index of securities, certificates of deposit, or mortgage loans or interests therein (including any interest therein or based on the value thereof) or option on any of the foregoing, including any option to purchase or sell any such security, certificate of deposit, mortgage loan, interest, group or index, or option;CommentsClose CommentsPermalink
`(V) means any margin loan;CommentsClose CommentsPermalink
`(VI) means any other agreement or transaction that is similar to any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink
`(VII) means any combination of the agreements or transactions referred to in this clause;CommentsClose CommentsPermalink
`(VIII) means any option to enter into any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink
`(IX) means a master agreement that provides for an agreement or transaction referred to in subclause (I), (III), (IV), (V), (VI), (VII), or (VIII), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a securities contract under this clause, except that the master agreement shall be considered to be a securities contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (III), (IV), (V), (VI), (VII), or (VIII); andCommentsClose CommentsPermalink
`(X) means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause.CommentsClose CommentsPermalink
`(iii) COMMODITY CONTRACT- The term `commodity contract' means--CommentsClose CommentsPermalink
`(I) with respect to a futures commission merchant, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade;CommentsClose CommentsPermalink
`(II) with respect to a foreign futures commission merchant, a foreign future;CommentsClose CommentsPermalink
`(III) with respect to a leverage transaction merchant, a leverage transaction;CommentsClose CommentsPermalink
`(IV) with respect to a clearing organization, a contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization, or commodity option traded on, or subject to the rules of, a contract market or board of trade that is cleared by such clearing organization;CommentsClose CommentsPermalink
`(V) with respect to a commodity options dealer, a commodity option;CommentsClose CommentsPermalink
`(VI) any other agreement or transaction that is similar to any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink
`(VII) any combination of the agreements or transactions referred to in this clause;CommentsClose CommentsPermalink
`(VIII) any option to enter into any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink
`(IX) a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), (III), (IV), (V), (VI), (VII), or (VIII), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a commodity contract under this clause, except that the master agreement shall be considered to be a commodity contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), (III), (IV), (V), (VI), (VII), or (VIII); orCommentsClose CommentsPermalink
`(X) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in this clause, including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in this clause.CommentsClose CommentsPermalink
`(iv) FORWARD CONTRACT- The term `forward contract' means--CommentsClose CommentsPermalink
`(I) a contract (other than a commodity contract) for the purchase, sale, or transfer of a commodity or any similar good, article, service, right, or interest which is presently or in the future becomes the subject of dealing in the forward contract trade, or product or byproduct thereof, with a maturity date more than 2 days after the date the contract is entered into, including, a repurchase transaction, reverse repurchase transaction, consignment, lease, swap, hedge transaction, deposit, loan, option, allocated transaction, unallocated transaction, or any other similar agreement;CommentsClose CommentsPermalink
`(II) any combination of agreements or transactions referred to in subclauses (I) and (III);CommentsClose CommentsPermalink
`(III) any option to enter into any agreement or transaction referred to in subclause (I) or (II);CommentsClose CommentsPermalink
`(IV) a master agreement that provides for an agreement or transaction referred to in subclauses (I), (II), or (III), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a forward contract under this clause, except that the master agreement shall be considered to be a forward contract under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), or (III); orCommentsClose CommentsPermalink
`(V) any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (II), (III), or (IV), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause.CommentsClose CommentsPermalink
`(v) REPURCHASE AGREEMENT- The term `repurchase agreement' (which definition also applies to a reverse repurchase agreement)--CommentsClose CommentsPermalink
`(I) means an agreement, including related terms, which provides for the transfer of one or more certificates of deposit, mortgage-related securities (as such term is defined in the Securities Exchange Act of 1934), mortgage loans, interests in mortgage-related securities or mortgage loans, eligible bankers' acceptances, qualified foreign government securities or securities that are direct obligations of, or that are fully guaranteed by, the United States or any agency of the United States against the transfer of funds by the transferee of such certificates of deposit, eligible bankers' acceptances, securities, mortgage loans, or interests with a simultaneous agreement by such transferee to transfer to the transferor thereof certificates of deposit, eligible bankers' acceptances, securities, mortgage loans, or interests as described above, at a date certain not later than 1 year after such transfers or on demand, against the transfer of funds, or any other similar agreement;CommentsClose CommentsPermalink
`(II) does not include any repurchase obligation under a participation in a commercial mortgage loan unless the Agency determines by regulation, resolution, or order to include any such participation within the meaning of such term;CommentsClose CommentsPermalink
`(III) means any combination of agreements or transactions referred to in subclauses (I) and (IV);CommentsClose CommentsPermalink
`(IV) means any option to enter into any agreement or transaction referred to in subclause (I) or (III);CommentsClose CommentsPermalink
`(V) means a master agreement that provides for an agreement or transaction referred to in subclause (I), (III), or (IV), together with all supplements to any such master agreement, without regard to whether the master agreement provides for an agreement or transaction that is not a repurchase agreement under this clause, except that the master agreement shall be considered to be a repurchase agreement under this subclause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (III), or (IV); andCommentsClose CommentsPermalink
`(VI) means any security agreement or arrangement or other credit enhancement related to any agreement or transaction referred to in subclause (I), (III), (IV), or (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause.CommentsClose CommentsPermalink
For purposes of this clause, the term `qualified foreign government security' means a security that is a direct obligation of, or that is fully guaranteed by, the central government of a member of the Organization for Economic Cooperation and Development (as determined by regulation or order adopted by the appropriate Federal banking authority).CommentsClose CommentsPermalink
`(vi) SWAP AGREEMENT- The term `swap agreement' means--CommentsClose CommentsPermalink
`(I) any agreement, including the terms and conditions incorporated by reference in any such agreement, which is an interest rate swap, option, future, or forward agreement, including a rate floor, rate cap, rate collar, cross-currency rate swap, and basis swap; a spot, same day-tomorrow, tomorrow-next, forward, or other foreign exchange or precious metals agreement; a currency swap, option, future, or forward agreement; an equity index or equity swap, option, future, or forward agreement; a debt index or debt swap, option, future, or forward agreement; a total return, credit spread or credit swap, option, future, or forward agreement; a commodity index or commodity swap, option, future, or forward agreement; or a weather swap, weather derivative, or weather option;CommentsClose CommentsPermalink
`(II) any agreement or transaction that is similar to any other agreement or transaction referred to in this clause and that is of a type that has been, is presently, or in the future becomes, the subject of recurrent dealings in the swap markets (including terms and conditions incorporated by reference in such agreement) and that is a forward, swap, future, or option on one or more rates, currencies, commodities, equity securities or other equity instruments, debt securities or other debt instruments, quantitative measures associated with an occurrence, extent of an occurrence, or contingency associated with a financial, commercial, or economic consequence, or economic or financial indices or measures of economic or financial risk or value;CommentsClose CommentsPermalink
`(III) any combination of agreements or transactions referred to in this clause;CommentsClose CommentsPermalink
`(IV) any option to enter into any agreement or transaction referred to in this clause;CommentsClose CommentsPermalink
`(V) a master agreement that provides for an agreement or transaction referred to in subclause (I), (II), (III), or (IV), together with all supplements to any such master agreement, without regard to whether the master agreement contains an agreement or transaction that is not a swap agreement under this clause, except that the master agreement shall be considered to be a swap agreement under this clause only with respect to each agreement or transaction under the master agreement that is referred to in subclause (I), (II), (III), or (IV); andCommentsClose CommentsPermalink
`(VI) any security agreement or arrangement or other credit enhancement related to any agreements or transactions referred to in subclause (I), (II), (III), (IV), or (V), including any guarantee or reimbursement obligation in connection with any agreement or transaction referred to in any such subclause.CommentsClose CommentsPermalink
Such term is applicable for purposes of this subsection only and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any swap agreement under any other statute, regulation, or rule, including the Securities Act of 1933, the Securities Exchange Act of 1934, the Public Utility Holding Company Act of 1935, the Trust Indenture Act of 1939, the Investment Company Act of 1940, the Investment Advisers Act of 1940, the Securities Investor Protection Act of 1970, the Commodity Exchange Act, the Gramm-Leach-Bliley Act, and the Legal Certainty for Bank Products Act of 2000.CommentsClose CommentsPermalink
`(vii) TREATMENT OF MASTER AGREEMENT AS ONE AGREEMENT- Any master agreement for any contract or agreement described in any preceding clause of this subparagraph (or any master agreement for such master agreement or agreements), together with all supplements to such master agreement, shall be treated as a single agreement and a single qualified financial contract. If a master agreement contains provisions relating to agreements or transactions that are not themselves qualified financial contracts, the master agreement shall be deemed to be a qualified financial contract only with respect to those transactions that are themselves qualified financial contracts.CommentsClose CommentsPermalink
`(viii) TRANSFER- The term `transfer' means every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with property or with an interest in property, including retention of title as a security interest and foreclosure of the regulated entity's equity of redemption.CommentsClose CommentsPermalink
`(E) CERTAIN PROTECTIONS IN EVENT OF APPOINTMENT OF CONSERVATOR- Notwithstanding any other provision of this Act (other than paragraph (13) of this subsection), any other Federal law, or the law of any State, no person shall be stayed or prohibited from exercising--CommentsClose CommentsPermalink
`(i) any right such person has to cause the termination, liquidation, or acceleration of any qualified financial contract with a regulated entity in a conservatorship based upon a default under such financial contract which is enforceable under applicable noninsolvency law;CommentsClose CommentsPermalink
`(ii) any right under any security agreement or arrangement or other credit enhancement relating to one or more such qualified financial contracts; orCommentsClose CommentsPermalink
`(iii) any right to offset or net out any termination values, payment amounts, or other transfer obligations arising under or in connection with such qualified financial contracts.CommentsClose CommentsPermalink
`(F) CLARIFICATION- No provision of law shall be construed as limiting the right or power of the Agency, or authorizing any court or agency to limit or delay, in any manner, the right or power of the Agency to transfer any qualified financial contract in accordance with paragraphs (9) and (10) of this subsection or to disaffirm or repudiate any such contract in accordance with subsection (d)(1) of this section.CommentsClose CommentsPermalink
`(G) WALKAWAY CLAUSES NOT EFFECTIVE-CommentsClose CommentsPermalink
`(i) IN GENERAL- Notwithstanding the provisions of subparagraphs (A) and (E), and sections 403 and 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991, no walkaway clause shall be enforceable in a qualified financial contract of a regulated entity in default.CommentsClose CommentsPermalink
`(ii) WALKAWAY CLAUSE DEFINED- For purposes of this subparagraph, the term `walkaway clause' means a provision in a qualified financial contract that, after calculation of a value of a party's position or an amount due to or from 1 of the parties in accordance with its terms upon termination, liquidation, or acceleration of the qualified financial contract, either does not create a payment obligation of a party or extinguishes a payment obligation of a party in whole or in part solely because of such party's status as a nondefaulting party.CommentsClose CommentsPermalink
`(9) TRANSFER OF QUALIFIED FINANCIAL CONTRACTS- In making any transfer of assets or liabilities of a regulated entity in default which includes any qualified financial contract, the conservator or receiver for such regulated entity shall either--CommentsClose CommentsPermalink
`(A) transfer to 1 person--CommentsClose CommentsPermalink
`(i) all qualified financial contracts between any person (or any affiliate of such person) and the regulated entity in default;CommentsClose CommentsPermalink
`(ii) all claims of such person (or any affiliate of such person) against such regulated entity under any such contract (other than any claim which, under the terms of any such contract, is subordinated to the claims of general unsecured creditors of such regulated entity);CommentsClose CommentsPermalink
`(iii) all claims of such regulated entity against such person (or any affiliate of such person) under any such contract; andCommentsClose CommentsPermalink
`(iv) all property securing or any other credit enhancement for any contract described in clause (i) or any claim described in clause (ii) or (iii) under any such contract; orCommentsClose CommentsPermalink
`(B) transfer none of the financial contracts, claims, or property referred to under subparagraph (A) (with respect to such person and any affiliate of such person).CommentsClose CommentsPermalink
`(10) NOTIFICATION OF TRANSFER-CommentsClose CommentsPermalink
`(A) IN GENERAL- If--CommentsClose CommentsPermalink
`(i) the conservator or receiver for a regulated entity in default makes any transfer of the assets and liabilities of such regulated entity, andCommentsClose CommentsPermalink
`(ii) the transfer includes any qualified financial contract,CommentsClose CommentsPermalink
the conservator or receiver shall notify any person who is a party to any such contract of such transfer by 5:00 p.m. (eastern time) on the business day following the date of the appointment of the receiver in the case of a receivership, or the business day following such transfer in the case of a conservatorship.CommentsClose CommentsPermalink
`(B) CERTAIN RIGHTS NOT ENFORCEABLE-CommentsClose CommentsPermalink
`(i) RECEIVERSHIP- A person who is a party to a qualified financial contract with a regulated entity may not exercise any right that such person has to terminate, liquidate, or net such contract under paragraph (8)(A) of this subsection or section 403 or 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991, solely by reason of or incidental to the appointment of a receiver for the regulated entity (or the insolvency or financial condition of the regulated entity for which the receiver has been appointed)--CommentsClose CommentsPermalink
`(I) until 5:00 p.m. (eastern time) on the business day following the date of the appointment of the receiver; orCommentsClose CommentsPermalink
`(II) after the person has received notice that the contract has been transferred pursuant to paragraph (9)(A).CommentsClose CommentsPermalink
`(ii) CONSERVATORSHIP- A person who is a party to a qualified financial contract with a regulated entity may not exercise any right that such person has to terminate, liquidate, or net such contract under paragraph (8)(E) of this subsection or section 403 or 404 of the Federal Deposit Insurance Corporation Improvement Act of 1991, solely by reason of or incidental to the appointment of a conservator for the regulated entity (or the insolvency or financial condition of the regulated entity for which the conservator has been appointed).CommentsClose CommentsPermalink
`(iii) NOTICE- For purposes of this paragraph, the Agency as receiver or conservator of a regulated entity shall be deemed to have notified a person who is a party to a qualified financial contract with such regulated entity if the Agency has taken steps reasonably calculated to provide notice to such person by the time specified in subparagraph (A).CommentsClose CommentsPermalink
`(C) BUSINESS DAY DEFINED- For purposes of this paragraph, the term `business day' means any day other than any Saturday, Sunday, or any day on which either the New York Stock Exchange or the Federal Reserve Bank of New York is closed.CommentsClose CommentsPermalink
`(11) DISAFFIRMANCE OR REPUDIATION OF QUALIFIED FINANCIAL CONTRACTS- In exercising the rights of disaffirmance or repudiation of a conservator or receiver with respect to any qualified financial contract to which a regulated entity is a party, the conservator or receiver for such institution shall either--CommentsClose CommentsPermalink
`(A) disaffirm or repudiate all qualified financial contracts between--CommentsClose CommentsPermalink
`(i) any person or any affiliate of such person; andCommentsClose CommentsPermalink
`(ii) the regulated entity in default; orCommentsClose CommentsPermalink
`(B) disaffirm or repudiate none of the qualified financial contracts referred to in subparagraph (A) (with respect to such person or any affiliate of such person).CommentsClose CommentsPermalink
`(12) CERTAIN SECURITY INTERESTS NOT AVOIDABLE- No provision of this subsection shall be construed as permitting the avoidance of any legally enforceable or perfected security interest in any of the assets of any regulated entity, except where such an interest is taken in contemplation of the insolvency of the regulated entity, or with the intent to hinder, delay, or defraud the regulated entity or the creditors of such regulated entity.CommentsClose CommentsPermalink
`(13) AUTHORITY TO ENFORCE CONTRACTS-CommentsClose CommentsPermalink
`(A) IN GENERAL- Notwithstanding any provision of a contract providing for termination, default, acceleration, or exercise of rights upon, or solely by reason of, insolvency or the appointment of a conservator or receiver, the conservator or receiver may enforce any contract or regulated entity bond entered into by the regulated entity.CommentsClose CommentsPermalink
`(B) CERTAIN RIGHTS NOT AFFECTED- No provision of this paragraph may be construed as impairing or affecting any right of the conservator or receiver to enforce or recover under a director's or officer's liability insurance contract or surety bond under other applicable law.CommentsClose CommentsPermalink
`(C) CONSENT REQUIREMENT-CommentsClose CommentsPermalink
`(i) IN GENERAL- Except as otherwise provided under this section, no person may exercise any right or power to terminate, accelerate, or declare a default under any contract to which a regulated entity is a party, or to obtain possession of or exercise control over any property of the regulated entity, or affect any contractual rights of the regulated entity, without the consent of the conservator or receiver, as appropriate, for a period of--CommentsClose CommentsPermalink
`(I) 45 days after the date of appointment of a conservator; orCommentsClose CommentsPermalink
`(II) 90 days after the date of appointment of a receiver.CommentsClose CommentsPermalink
`(ii) EXCEPTIONS- This paragraph shall--CommentsClose CommentsPermalink
`(I) not apply to a director's or officer's liability insurance contract;CommentsClose CommentsPermalink
`(II) not apply to the rights of parties to any qualified financial contracts under subsection (d)(8); andCommentsClose CommentsPermalink
`(III) not be construed as permitting the conservator or receiver to fail to comply with otherwise enforceable provisions of such contracts.CommentsClose CommentsPermalink
`(14) SAVINGS CLAUSE- The meanings of terms used in this subsection are applicable for purposes of this subsection only, and shall not be construed or applied so as to challenge or affect the characterization, definition, or treatment of any similar terms under any other statute, regulation, or rule, including the Gramm-Leach-Bliley Act, the Legal Certainty for Bank Products Act of 2000, the securities laws (as that term is defined in section 3(a)(47) of the Securities Exchange Act of 1934), and the Commodity Exchange Act.CommentsClose CommentsPermalink
`(15) EXCEPTION FOR FEDERAL RESERVE AND FEDERAL HOME LOAN BANKS- No provision of this subsection shall apply with respect to--CommentsClose CommentsPermalink
`(A) any extension of credit from any Federal home loan bank or Federal Reserve Bank to any regulated entity; orCommentsClose CommentsPermalink
`(B) any security interest in the assets of the regulated entity securing any such extension of credit.CommentsClose CommentsPermalink
`(e) Valuation of Claims in Default-CommentsClose CommentsPermalink
`(1) IN GENERAL- Notwithstanding any other provision of Federal law or the law of any State, and regardless of the method which the Agency determines to utilize with respect to a regulated entity in default or in danger of default, including transactions authorized under subsection (i), this subsection shall govern the rights of the creditors of such regulated entity.CommentsClose CommentsPermalink
`(2) MAXIMUM LIABILITY- The maximum liability of the Agency, acting as receiver or in any other capacity, to any person having a claim against the receiver or the regulated entity for which such receiver is appointed shall equal the lesser of--CommentsClose CommentsPermalink
`(A) the amount such claimant would have received if the Agency had liquidated the assets and liabilities of such regulated entity without exercising the authority of the Agency under subsection (i) of this section; orCommentsClose CommentsPermalink
`(B) the amount of proceeds realized from the performance of contracts or sale of the assets of the regulated entity.CommentsClose CommentsPermalink
`(f) Limitation on Court Action- Except as provided in this section or at the request of the Director, no court may take any action to restrain or affect the exercise of powers or functions of the Agency as a conservator or a receiver.CommentsClose CommentsPermalink
`(g) Liability of Directors and Officers-CommentsClose CommentsPermalink
`(1) IN GENERAL- A director or officer of a regulated entity may be held personally liable for monetary damages in any civil action by, on behalf of, or at the request or direction of the Agency, which action is prosecuted wholly or partially for the benefit of the Agency--CommentsClose CommentsPermalink
`(A) acting as conservator or receiver of such regulated entity, orCommentsClose CommentsPermalink
`(B) acting based upon a suit, claim, or cause of action purchased from, assigned by, or otherwise conveyed by such receiver or conservator,CommentsClose CommentsPermalink
for gross negligence, including any similar conduct or conduct that demonstrates a greater disregard of a duty of care (than gross negligence) including intentional tortious conduct, as such terms are defined and determined under applicable State law.CommentsClose CommentsPermalink
`(2) NO LIMITATION- Nothing in this paragraph shall impair or affect any right of the Agency under other applicable law.CommentsClose CommentsPermalink
`(h) Damages- In any proceeding related to any claim against a director, officer, employee, agent, attorney, accountant, appraiser, or any other party employed by or providing services to a regulated entity, recoverable damages determined to result from the improvident or otherwise improper use or investment of any assets of the regulated entity shall include principal losses and appropriate interest.CommentsClose CommentsPermalink
`(i) Limited-Life Regulated Entities-CommentsClose CommentsPermalink
`(1) ORGANIZATION-CommentsClose CommentsPermalink
`(A) PURPOSE- If a regulated entity is in default, or if the Agency anticipates that a regulated entity will default, the Agency may organize a limited-life regulated entity with those powers and attributes of the regulated entity in default or in danger of default that the Director determines necessary, subject to the provisions of this subsection. The Director shall grant a temporary charter to the limited-life regulated entity, and the limited-life regulated entity shall operate subject to that charter.CommentsClose CommentsPermalink
`(B) AUTHORITIES- Upon the creation of a limited-life regulated entity under subparagraph (A), the limited-life regulated entity may--CommentsClose CommentsPermalink
`(i) assume such liabilities of the regulated entity that is in default or in danger of default as the Agency may, in its discretion, determine to be appropriate, provided that the liabilities assumed shall not exceed the amount of assets of the limited-life regulated entity;CommentsClose CommentsPermalink
`(ii) purchase such assets of the regulated entity that is in default, or in danger of default, as the Agency may, in its discretion, determine to be appropriate; andCommentsClose CommentsPermalink
`(iii) perform any other temporary function which the Agency may, in its discretion, prescribe in accordance with this section.CommentsClose CommentsPermalink
`(2) CHARTER-CommentsClose CommentsPermalink
`(A) CONDITIONS- The Agency may grant a temporary charter if the Agency determines that the continued operation of the regulated entity in default or in danger of default is in the best interest of the national economy and the housing markets.CommentsClose CommentsPermalink
`(B) TREATMENT AS BEING IN DEFAULT FOR CERTAIN PURPOSES- A limited-life regulated entity shall be treated as a regulated entity in default at such times and for such purposes as the Agency may, in its discretion, determine.CommentsClose CommentsPermalink
`(C) MANAGEMENT- A limited-life regulated entity, upon the granting of its charter, shall be under the management of a board of directors consisting of not fewer than 5 nor more than 10 members appointed by the Agency.CommentsClose CommentsPermalink
`(D) BYLAWS- The board of directors of a limited-life regulated entity shall adopt such bylaws as may be approved by the Agency.CommentsClose CommentsPermalink
`(3) CAPITAL STOCK- No capital stock need be paid into a limited-life regulated entity by the Agency.CommentsClose CommentsPermalink
`(4) INVESTMENTS- Funds of a limited-life regulated entity shall be kept on hand in cash, invested in obligations of the United States or obligations guaranteed as to principal and interest by the United States, or deposited with the Agency, or any Federal Reserve bank.CommentsClose CommentsPermalink
`(5) EXEMPT STATUS- Notwithstanding any other provision of Federal or State law, the limited-life regulated entity, its franchise, property, and income shall be exempt from all taxation now or hereafter imposed by the United States, by any territory, dependency, or possession thereof, or by any State, county, municipality, or local taxing authority.CommentsClose CommentsPermalink
`(6) WINDING UP-CommentsClose CommentsPermalink
`(A) IN GENERAL- Subject to subparagraph (B), unless Congress authorizes the sale of the capital stock of the limited-life regulated entity, not later than 2 years after the date of its organization, the Agency shall wind up the affairs of the limited-life regulated entity.CommentsClose CommentsPermalink
`(B) EXTENSION- The Director may, in the discretion of the Director, extend the status of the limited-life regulated entity for 3 additional 1-year periods.CommentsClose CommentsPermalink
`(7) TRANSFER OF ASSETS AND LIABILITIES-CommentsClose CommentsPermalink
`(A) IN GENERAL-CommentsClose CommentsPermalink
`(i) TRANSFER OF ASSETS AND LIABILITIES- The Agency, as receiver, may transfer any assets and liabilities of a regulated entity in default, or in danger of default, to the limited-life regulated entity in accordance with paragraph (1).CommentsClose CommentsPermalink
`(ii) SUBSEQUENT TRANSFERS- At any time after a charter is transferred to a limited-life regulated entity, the Agency, as receiver, may transfer any assets and liabilities of such regulated entity in default, or in danger in default, as the Agency may, in its discretion, determine to be appropriate in accordance with paragraph (1).CommentsClose CommentsPermalink
`(iii) EFFECTIVE WITHOUT APPROVAL- The transfer of any assets or liabilities of a regulated entity in default, or in danger of default, transferred to a limited-life regulated entity shall be effective without any further approval under Federal or State law, assignment, or consent with respect thereto.CommentsClose CommentsPermalink
`(8) PROCEEDS- To the extent that available proceeds from the limited-life regulated entity exceed amounts required to pay obligations, such proceeds may be paid to the regulated entity in default, or in danger of default.CommentsClose CommentsPermalink
`(9) POWERS-CommentsClose CommentsPermalink
`(A) IN GENERAL- Each limited-life regulated entity created under this subsection shall have all corporate powers of, and be subject to the same provisions of law as, the regulated entity in default or in danger of default to which it relates, except that--CommentsClose CommentsPermalink
`(i) the Agency may--CommentsClose CommentsPermalink
`(I) remove the directors of a limited-life regulated entity; andCommentsClose CommentsPermalink
`(II) fix the compensation of members of the board of directors and senior management, as determined by the Agency in its discretion, of a limited-life regulated entity;CommentsClose CommentsPermalink
`(ii) the Agency may indemnify the representatives for purposes of paragraph (1)(B), and the directors, officers, employees, and agents of a limited-life regulated entity on such terms as the Agency determines to be appropriate; andCommentsClose CommentsPermalink
`(iii) the board of directors of a limited-life regulated entity--CommentsClose CommentsPermalink
`(I) shall elect a chairperson who may also serve in the position of chief executive officer, except that such person shall not serve either as chairperson or as chief executive officer without the prior approval of the Agency; andCommentsClose CommentsPermalink
`(II) may appoint a chief executive officer who is not also the chairperson, except that such person shall not serve as chief executive officer without the prior approval of the Agency.CommentsClose CommentsPermalink
`(B) STAY OF JUDICIAL ACTION- Any judicial action to which a limited-life regulated entity becomes a party by virtue of its acquisition of any assets or assumption of any liabilities of a regulated entity in default shall be stayed from further proceedings for a period of up to 45 days at the request of the limited-life regulated entity. Such period may be modified upon the consent of all parties.CommentsClose CommentsPermalink
`(10) OBTAINING OF CREDIT AND INCURRING OF DEBT-CommentsClose CommentsPermalink
`(A) IN GENERAL- The limited-life regulated entity may obtain unsecured credit and incur unsecured debt in the ordinary course of business.CommentsClose CommentsPermalink
`(B) INABILITY TO OBTAIN CREDIT- If the limited-life regulated entity is unable to obtain unsecured credit the Director may authorize the obtaining of credit or the incurring of debt--CommentsClose CommentsPermalink
`(i) with priority over any or all administrative expenses;CommentsClose CommentsPermalink
`(ii) secured by a lien on property that is not otherwise subject to a lien; orCommentsClose CommentsPermalink
`(iii) secured by a junior lien on property that is subject to a lien.CommentsClose CommentsPermalink
`(C) LIMITATIONS-CommentsClose CommentsPermalink
`(i) IN GENERAL- The Director, after notice and a hearing, may authorize the obtaining of credit or the incurring of debt secured by a senior or equal lien on property that is subject to a lien (other than mortgages that collateralize the mortgage-backed securities issued or guaranteed by the regulated entity) only if--CommentsClose CommentsPermalink
`(I) the limited-life regulated entity is unable to obtain such credit otherwise; andCommentsClose CommentsPermalink
`(II) there is adequate protection of the interest of the holder of the lien on the property which such senior or equal lien is proposed to be granted.CommentsClose CommentsPermalink
`(ii) BURDEN OF PROOF- In any hearing under this subsection, the Director has the burden of proof on the issue of adequate protection.CommentsClose CommentsPermalink
`(D) EFFECT ON DEBTS AND LIENS- The reversal or modification on appeal of an authorization under this paragraph to obtain credit or incur debt, or of a grant under this section of a priority or a lien, does not affect the validity of any debt so incurred, or any priority or lien so granted, to an entity that extended such credit in good faith, whether or not such entity knew of the pendency of the appeal, unless such authorization and the incurring of such debt, or the granting of such priority or lien, were stayed pending appeal.CommentsClose CommentsPermalink
`(11) ISSUANCE OF PREFERRED DEBT- A limited-life regulated entity may, subject to the approval of the Director and subject to such terms and conditions as the Director may prescribe, issue notes, bonds, or other debt obligations of a class to which all other debt obligations of the limited-life regulated entity shall be subordinate in right and payment.CommentsClose CommentsPermalink
`(12) NO FEDERAL STATUS-CommentsClose CommentsPermalink
`(A) AGENCY STATUS- A limited-life regulated entity is not an agency, establishment, or instrumentality of the United States.CommentsClose CommentsPermalink
`(B) EMPLOYEE STATUS- Representatives for purposes of paragraph (1)(B), interim directors, directors, officers, employees, or agents of a limited-life regulated entity are not, solely by virtue of service in any such capacity, officers or employees of the United States. Any employee of the Agency or of any Federal instrumentality who serves at the request of the Agency as a representative for purposes of paragraph (1)(B), interim director, director, officer, employee, or agent of a limited-life regulated entity shall not--CommentsClose CommentsPermalink
`(i) solely by virtue of service in any such capacity lose any existing status as an officer or employee of the United States for purposes of title 5, United States Code, or any other provision of law; orCommentsClose CommentsPermalink
`(ii) receive any salary or benefits for service in any such capacity with respect to a limited-life regulated entity in addition to such salary or benefits as are obtained through employment with the Agency or such Federal instrumentality.CommentsClose CommentsPermalink
`(13) ADDITIONAL POWERS- In addition to any other powers granted under this subsection, a limited-life regulated entity may--CommentsClose CommentsPermalink
`(A) extend a maturity date or change in an interest rate or other term of outstanding securities;CommentsClose CommentsPermalink
`(B) issue securities of the limited-life regulated entity, for cash, for property, for existing securities, or in exchange for claims or interests, or for any other appropriate purposes; andCommentsClose CommentsPermalink
`(C) take any other action not inconsistent with this section.CommentsClose CommentsPermalink
`(j) Other Exemptions- When acting as a receiver, the following provisions shall apply with respect to the Agency:CommentsClose CommentsPermalink
`(1) EXEMPTION FROM TAXATION- The Agency, including its franchise, its capital, reserves, and surplus, and its income, shall be exempt from all taxation imposed by any State, country, municipality, or local taxing authority, except that any real property of the Agency shall be subject to State, territorial, county, municipal, or local taxation to the same extent according to its value as other real property is taxed, except that, notwithstanding the failure of any person to challenge an assessment under State law of the value of such property, and the tax thereon, shall be determined as of the period for which such tax is imposed.CommentsClose CommentsPermalink
`(2) EXEMPTION FROM ATTACHMENT AND LIENS- No property of the Agency shall be subject to levy, attachment, garnishment, foreclosure, or sale without the consent of the Agency, nor shall any involuntary lien attach to the property of the Agency.CommentsClose CommentsPermalink
`(3) EXEMPTION FROM PENALTIES AND FINES- The Agency shall not be liable for any amounts in the nature of penalties or fines, including those arising from the failure of any person to pay any real property, personal property, probate, or recording tax or any recording or filing fees when due.CommentsClose CommentsPermalink
`(k) Prohibition of Charter Revocation- In no case may a receiver appointed pursuant to this section revoke, annul, or terminate the charter of a regulated entity.'.CommentsClose CommentsPermalink
(b) Conforming Amendments-CommentsClose CommentsPermalink
(1) HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1992- Subtitle B of title XIII of the Housing and Community Development Act of 1992 is amended by striking sections 1369 (
(2) FEDERAL HOME LOAN BANKS- Section 25 of the Federal Home Loan Bank Act (
`SEC. 25. SUCCESSION OF FEDERAL HOME LOAN BANKS.
`Each Federal Home Loan Bank shall have succession until it is voluntarily merged with another Bank under this Act, or until it is merged, reorganized, rehabilitated, liquidated, or otherwise wound up by the Director in accordance with the provisions of section 1367 of the Housing and Community Development Act of 1992, or by further Act of Congress.'.CommentsClose CommentsPermalink
SEC. 155. CONFORMING AMENDMENTS.
Title XIII of the Housing and Community Development Act of 1992, as amended by the preceding provisions of this Act, is further amended--CommentsClose CommentsPermalink
(1) in sections 1365 (
(A) by striking `An enterprise' each place such term appears and inserting `A regulated entity';CommentsClose CommentsPermalink
(B) by striking `an enterprise' each place such term appears and inserting `a regulated entity'; andCommentsClose CommentsPermalink
(C) by striking `the enterprise' each place such term appears and inserting `the regulated entity';CommentsClose CommentsPermalink
(2) in section 1366 (
(A) in subsection (b)(7), by striking `section 1369 (excluding subsection (a)(1) and (2))' and inserting `section 1367'; andCommentsClose CommentsPermalink
(B) in subsection (d), by striking `the enterprises' and inserting `the regulated entities';CommentsClose CommentsPermalink
(3) in section 1368(d) (
(4) in section 1369C (
(A) in subsection (a)(4), by striking `activities (including existing and new programs)' and inserting `activities, services, undertakings, and offerings (including existing and new products (as such term is defined in section 1321(f))'; andCommentsClose CommentsPermalink
(B) in subsection (c), by striking `any enterprise' and inserting `any regulated entity'; andCommentsClose CommentsPermalink
(5) in subsections (a) and (d) of section 1369D, by striking `section 1366 or 1367 or action under section 1369)' each place such phrase appears and inserting `section 1367)'.CommentsClose CommentsPermalink
Subtitle D--Enforcement Actions
SEC. 161. CEASE-AND-DESIST PROCEEDINGS.
Section 1371 of the Housing and Community Development Act of 1992 (
(1) by striking subsections (a) and (b) and inserting the following new subsections:CommentsClose CommentsPermalink
`(a) Issuance for Unsafe or Unsound Practices and Violations of Rules or Laws- If, in the opinion of the Director, a regulated entity or any regulated entity-affiliated party is engaging or has engaged, or the Director has reasonable cause to believe that the regulated entity or any regulated entity-affiliated party is about to engage, in an unsafe or unsound practice in conducting the business of the regulated entity or is violating or has violated, or the Director has reasonable cause to believe that the regulated entity or any regulated entity-affiliated party is about to violate, a law, rule, or regulation, or any condition imposed in writing by the Director in connection with the granting of any application or other request by the regulated entity or any written agreement entered into with the Director, the Director may issue and serve upon the regulated entity or such party a notice of charges in respect thereof. The Director may not, pursuant to this section, enforce compliance with any housing goal established under subpart B of part 2 of subtitle A of this title, with section 1336 or 1337 of this title, with subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act (
`(b) Issuance for Unsatisfactory Rating- If a regulated entity receives, in its most recent report of examination, a less-than-satisfactory rating for asset quality, management, earnings, or liquidity, the Director may (if the deficiency is not corrected) deem the regulated entity to be engaging in an unsafe or unsound practice for purposes of this subsection.';CommentsClose CommentsPermalink
(2) in subsection (c)(2), by striking `enterprise, executive officer, or director' and inserting `regulated entity or regulated entity-affiliated party'; andCommentsClose CommentsPermalink
(3) in subsection (d)--CommentsClose CommentsPermalink
(A) in the matter preceding paragraph (1), by striking `enterprise, executive officer, or director' and inserting `regulated entity or regulated entity-affiliated party';CommentsClose CommentsPermalink
(B) in paragraph (1)--CommentsClose CommentsPermalink
(i) by striking `an executive officer or a director' and inserting `a regulated entity affiliated party'; andCommentsClose CommentsPermalink
(ii) by inserting `(including reimbursement of compensation under section 1318)' after `reimbursement';CommentsClose CommentsPermalink
(C) in paragraph (6), by striking `and' at the end;CommentsClose CommentsPermalink
(D) by redesignating paragraph (7) as paragraph (8); andCommentsClose CommentsPermalink
(E) by inserting after paragraph (6) the following new paragraph:CommentsClose CommentsPermalink
`(7) to effect an attachment on a regulated entity or regulated entity-affiliated party subject to an order under this section or section 1372; and'.CommentsClose CommentsPermalink
SEC. 162. TEMPORARY CEASE-AND-DESIST PROCEEDINGS.
Section 1372 of the Housing and Community Development Act of 1992 (
(1) by striking subsection (a) and inserting the following new subsection:CommentsClose CommentsPermalink
`(a) Grounds for Issuance- Whenever the Director determines that the violation or threatened violation or the unsafe or unsound practice or practices specified in the notice of charges served upon the regulated entity or any regulated entity-affiliated party pursuant to section 1371(a), or the continuation thereof, is likely to cause insolvency or significant dissipation of assets or earnings of the regulated entity, or is likely to weaken the condition of the regulated entity prior to the completion of the proceedings conducted pursuant to sections 1371 and 1373, the Director may issue a temporary order requiring the regulated entity or such party to cease and desist from any such violation or practice and to take affirmative action to prevent or remedy such insolvency, dissipation, condition, or prejudice pending completion of such proceedings. Such order may include any requirement authorized under section 1371(d).';CommentsClose CommentsPermalink
(2) in subsection (b), by striking `enterprise, executive officer, or director' and inserting `regulated entity or regulated entity-affiliated party';CommentsClose CommentsPermalink
(3) in subsection (d)--CommentsClose CommentsPermalink
(A) by striking `An enterprise, executive officer, or director' and inserting `A regulated entity or regulated entity-affiliated party'; andCommentsClose CommentsPermalink
(B) by striking `the enterprise, executive officer, or director' and inserting `the regulated entity or regulated entity-affiliated party'; andCommentsClose CommentsPermalink
(4) by striking subsection (e) and in inserting the following new subsection:CommentsClose CommentsPermalink
`(e) Enforcement- In the case of violation or threatened violation of, or failure to obey, a temporary cease-and-desist order issued pursuant to this section, the Director may apply to the United States District Court for the District of Columbia or the United States district court within the jurisdiction of which the headquarters of the regulated entity is located, for an injunction to enforce such order, and, if the court determines that there has been such violation or threatened violation or failure to obey, it shall be the duty of the court to issue such injunction.'.CommentsClose CommentsPermalink
SEC. 163. PREJUDGMENT ATTACHMENT.
The Housing and Community Development Act of 1992 is amended by inserting after section 1375 (
`SEC. 1375A. PREJUDGMENT ATTACHMENT.
`(a) In General- In any action brought pursuant to this title, or in actions brought in aid of, or to enforce an order in, any administrative or other civil action for money damages, restitution, or civil money penalties brought pursuant to this title, the court may, upon application of the Director or Attorney General, as applicable, issue a restraining order that--CommentsClose CommentsPermalink
`(1) prohibits any person subject to the proceeding from withdrawing, transferring, removing, dissipating, or disposing of any funds, assets or other property; andCommentsClose CommentsPermalink
`(2) appoints a person on a temporary basis to administer the restraining order.CommentsClose CommentsPermalink
`(b) Standard-CommentsClose CommentsPermalink
`(1) SHOWING- Rule 65 of the Federal Rules of Civil Procedure shall apply with respect to any proceeding under subsection (a) without regard to the requirement of such rule that the applicant show that the injury, loss, or damage is irreparable and immediate.CommentsClose CommentsPermalink
`(2) STATE PROCEEDING- If, in the case of any proceeding in a State court, the court determines that rules of civil procedure available under the laws of such State provide substantially similar protections to a party's right to due process as Rule 65 (as modified with respect to such proceeding by paragraph (1)), the relief sought under subsection (a) may be requested under the laws of such State.'.CommentsClose CommentsPermalink
SEC. 164. ENFORCEMENT AND JURISDICTION.
Section 1375 of the Housing and Community Development Act of 1992 (
(1) by striking subsection (a) and inserting the following new subsection:CommentsClose CommentsPermalink
`(a) Enforcement- The Director may, in the discretion of the Director, apply to the United States District Court for the District of Columbia, or the United States district court within the jurisdiction of which the headquarters of the regulated entity is located, for the enforcement of any effective and outstanding notice or order issued under this subtitle or subtitle B, or request that the Attorney General of the United States bring such an action. Such court shall have jurisdiction and power to order and require compliance with such notice or order.'; andCommentsClose CommentsPermalink
(2) in subsection (b), by striking `or 1376' and inserting `1376, or 1377'.CommentsClose CommentsPermalink
SEC. 165. CIVIL MONEY PENALTIES.
Section 1376 of the Housing and Community Development Act of 1992 (
(1) in subsection (a)--CommentsClose CommentsPermalink
(A) in the matter preceding paragraph (1), by striking `, or any executive officer or director' and inserting `or any regulated-entity affiliated party'; andCommentsClose CommentsPermalink
(B) in paragraph (1)--CommentsClose CommentsPermalink
(i) by striking `the Federal National Mortgage Association Charter Act, the Federal Home Loan Mortgage Corporation Act' and inserting `any provision of any of the authorizing statutes';CommentsClose CommentsPermalink
(ii) by striking `or Act' and inserting `or statute';CommentsClose CommentsPermalink
(iii) by striking `or subsection' and inserting `, subsection'; andCommentsClose CommentsPermalink
(iv) by inserting `, or paragraph (5) or (12) of section 10(j) of the Federal Home Loan Bank Act' before the semicolon at the end;CommentsClose CommentsPermalink
(2) by striking subsection (b) and inserting the following new subsection:CommentsClose CommentsPermalink
`(b) Amount of Penalty-CommentsClose CommentsPermalink
`(1) FIRST TIER- Any regulated entity which, or any regulated entity-affiliated party who--CommentsClose CommentsPermalink
`(A) violates any provision of this title, any provision of any of the authorizing statutes, or any order, condition, rule, or regulation under any such title or statute, except that the Director may not, pursuant to this section, enforce compliance with any housing goal established under subpart B of part 2 of subtitle A of this title, with section 1336 or 1337 of this title, with subsection (m) or (n) of section 309 of the Federal National Mortgage Association Charter Act (
`(B) violates any final or temporary order or notice issued pursuant to this title;CommentsClose CommentsPermalink
`(C) violates any condition imposed in writing by the Director in connection with the grant of any application or other request by such regulated entity; orCommentsClose CommentsPermalink
`(D) violates any written agreement between the regulated entity and the Director,CommentsClose CommentsPermalink
shall forfeit and pay a civil money penalty of not more than $10,000 for each day during which such violation continues.CommentsClose CommentsPermalink
`(2) SECOND TIER- Notwithstanding paragraph (1)--CommentsClose CommentsPermalink
`(A) if a regulated entity, or a regulated entity-affiliated party--CommentsClose CommentsPermalink
`(i) commits any violation described in any subparagraph of paragraph (1);CommentsClose CommentsPermalink
`(ii) recklessly engages in an unsafe or unsound practice in conducting the affairs of such regulated entity; orCommentsClose CommentsPermalink
`(iii) breaches any fiduciary duty; andCommentsClose CommentsPermalink
`(B) the violation, practice, or breach--CommentsClose CommentsPermalink
`(i) is part of a pattern of misconduct;CommentsClose CommentsPermalink
`(ii) causes or is likely to cause more than a minimal loss to such regulated entity; orCommentsClose CommentsPermalink
`(iii) results in pecuniary gain or other benefit to such party,CommentsClose CommentsPermalink
the regulated entity or regulated entity-affiliated party shall forfeit and pay a civil penalty of not more than $50,000 for each day during which such violation, practice, or breach continues.CommentsClose CommentsPermalink
`(3) THIRD TIER- Notwithstanding paragraphs (1) and (2), any regulated entity which, or any regulated entity-affiliated party who--CommentsClose CommentsPermalink
`(A) knowingly--CommentsClose CommentsPermalink
`(i) commits any violation or engages in any conduct described in any subparagraph of paragraph (1);CommentsClose CommentsPermalink
`(ii) engages in any unsafe or unsound practice in conducting the affairs of such regulated entity; orCommentsClose CommentsPermalink
`(iii) breaches any fiduciary duty; andCommentsClose CommentsPermalink
`(B) knowingly or recklessly causes a substantial loss to such regulated entity or a substantial pecuniary gain or other benefit to such party by reason of such violation, practice, or breach,CommentsClose CommentsPermalink
shall forfeit and pay a civil penalty in an amount not to exceed the applicable maximum amount determined under paragraph (4) for each day during which such violation, practice, or breach continues.CommentsClose CommentsPermalink
`(4) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION DESCRIBED IN PARAGRAPH (3)- The maximum daily amount of any civil penalty which may be assessed pursuant to paragraph (3) for any violation, practice, or breach described in such paragraph is--CommentsClose CommentsPermalink
`(A) in the case of any person other than a regulated entity, an amount not to exceed $2,000,000; andCommentsClose CommentsPermalink
`(B) in the case of any regulated entity, $2,000,000.';CommentsClose CommentsPermalink
(3) in subsection (c)(1)(B), by striking `enterprise, executive officer, or director' and inserting `regulated entity or regulated entity-affiliated party';CommentsClose CommentsPermalink
(4) in subsection (d), by striking the first sentence and inserting the following: `If a regulated entity or regulated entity-affiliated party fails to comply with an order of the Director imposing a civil money penalty under this section, after the order is no longer subject to review as provided under subsection (c)(1) and section 1374, the Director may, in the discretion of the Director, bring an action in the United States District Court for the District of Columbia, or the United States district court within the jurisdiction of which the headquarters of the regulated entity is located, to obtain a monetary judgment against the regulated entity or regulated entity affiliated party and such other relief as may be available, or request that the Attorney General of the United States bring such an action.'; andCommentsClose CommentsPermalink
(5) in subsection (g), by striking `subsection (b)(3)' and inserting `this section, unless authorized by the Director by rule, regulation, or order'.CommentsClose CommentsPermalink
SEC. 166. REMOVAL AND PROHIBITION AUTHORITY.
(a) In General- Subtitle C of title XIII of the Housing and Community Development Act of 1992 is amended--CommentsClose CommentsPermalink
(1) by redesignating sections 1377, 1378, 1379, 1379A, and 1379B (
(2) by inserting after section 1376 (
`SEC. 1377. REMOVAL AND PROHIBITION AUTHORITY.
`(a) Authority To Issue Order- Whenever the Director determines that--CommentsClose CommentsPermalink
`(1) any regulated entity-affiliated party has, directly or indirectly--CommentsClose CommentsPermalink
`(A) violated--CommentsClose CommentsPermalink
`(i) any law or regulation;CommentsClose CommentsPermalink
`(ii) any cease-and-desist order which has become final;CommentsClose CommentsPermalink
`(iii) any condition imposed in writing by the Director in connection with the grant of any application or other request by such regulated entity; orCommentsClose CommentsPermalink
`(iv) any written agreement between such regulated entity and the Director;CommentsClose CommentsPermalink
`(B) engaged or participated in any unsafe or unsound practice in connection with any regulated entity; orCommentsClose CommentsPermalink
`(C) committed or engaged in any act, omission, or practice which constitutes a breach of such party's fiduciary duty;CommentsClose CommentsPermalink
`(2) by reason of the violation, practice, or breach described in any subparagraph of paragraph (1)--CommentsClose CommentsPermalink
`(A) such regulated entity has suffered or will probably suffer financial loss or other damage; orCommentsClose CommentsPermalink
`(B) such party has received financial gain or other benefit by reason of such violation, practice, or breach; andCommentsClose CommentsPermalink
`(3) such violation, practice, or breach--CommentsClose CommentsPermalink
`(A) involves personal dishonesty on the part of such party; orCommentsClose CommentsPermalink
`(B) demonstrates willful or continuing disregard by such party for the safety or soundness of such regulated entity, the Director may serve upon such party a written notice of the Director's intention to remove such party from office or to prohibit any further participation by such party, in any manner, in the conduct of the affairs of any regulated entity.CommentsClose CommentsPermalink
`(b) Suspension Order-CommentsClose CommentsPermalink
`(1) SUSPENSION OR PROHIBITION AUTHORITY- If the Director serves written notice under subsection (a) to any regulated entity-affiliated party of the Director's intention to issue an order under such subsection, the Director may--CommentsClose CommentsPermalink
`(A) suspend such party from office or prohibit such party from further participation in any manner in the conduct of the affairs of the regulated entity, if the Director--CommentsClose CommentsPermalink
`(i) determines that such action is necessary for the protection of the regulated entity; andCommentsClose CommentsPermalink
`(ii) serves such party with written notice of the suspension order; andCommentsClose CommentsPermalink
`(B) prohibit the regulated entity from releasing to or on behalf of the regulated entity-affiliated party any compensation or other payment of money or other thing of current or potential value in connection with any resignation, removal, retirement, or other termination of employment or office of the party.CommentsClose CommentsPermalink
`(2) EFFECTIVE PERIOD- Any suspension order issued under this subsection--CommentsClose CommentsPermalink
`(A) shall become effective upon service; andCommentsClose CommentsPermalink
`(B) unless a court issues a stay of such order under subsection (g) of this section, shall remain in effect and enforceable until--CommentsClose CommentsPermalink
`(i) the date the Director dismisses the charges contained in the notice served under subsection (a) with respect to such party; orCommentsClose CommentsPermalink
`(ii) the effective date of an order issued by the Director to such party under subsection (a).CommentsClose CommentsPermalink
`(3) COPY OF ORDER- If the Director issues a suspension order under this subsection to any regulated entity-affiliated party, the Director shall serve a copy of such order on any regulated entity with which such party is affiliated at the time such order is issued.CommentsClose CommentsPermalink
`(c) Notice, Hearing, and Order- A notice of intention to remove a regulated entity-affiliated party from office or to prohibit such party from participating in the conduct of the affairs of a regulated entity shall contain a statement of the facts constituting grounds for such action, and shall fix a time and place at which a hearing will be held on such action. Such hearing shall be fixed for a date not earlier than 30 days nor later than 60 days after the date of service of such notice, unless an earlier or a later date is set by the Director at the request of (1) such party, and for good cause shown, or (2) the Attorney General of the United States. Unless such party shall appear at the hearing in person or by a duly authorized representative, such party shall be deemed to have consented to the issuance of an order of such removal or prohibition. In the event of such consent, or if upon the record made at any such hearing the Director shall find that any of the grounds specified in such notice have been established, the Director may issue such orders of suspension or removal from office, or prohibition from participation in the conduct of the affairs of the regulated entity, as it may deem appropriate, together with an order prohibiting compensation described in subsection (b)(1)(B). Any such order shall become effective at the expiration of 30 days after service upon such regulated entity and such party (except in the case of an order issued upon consent, which shall become effective at the time specified therein). Such order shall remain effective and enforceable except to such extent as it is stayed, modified, terminated, or set aside by action of the Director or a reviewing court.CommentsClose CommentsPermalink
`(d) Prohibition of Certain Specific Activities- Any person subject to an order issued under this section shall not--CommentsClose CommentsPermalink
`(1) participate in any manner in the conduct of the affairs of any regulated entity;CommentsClose CommentsPermalink
`(2) solicit, procure, transfer, attempt to transfer, vote, or attempt to vote any proxy, consent, or authorization with respect to any voting rights in any regulated entity;CommentsClose CommentsPermalink
`(3) violate any voting agreement previously approved by the Director; orCommentsClose CommentsPermalink
`(4) vote for a director, or serve or act as a regulated entity-affiliated party.CommentsClose CommentsPermalink
`(e) Industry-Wide Prohibition-CommentsClose CommentsPermalink
`(1) IN GENERAL- Except as provided in paragraph (2), any person who, pursuant to an order issued under this section, has been removed or suspended from office in a regulated entity or prohibited from participating in the conduct of the affairs of a regulated entity may not, while such order is in effect, continue or commence to hold any office in, or participate in any manner in the conduct of the affairs of, any regulated entity.CommentsClose CommentsPermalink
`(2) EXCEPTION IF DIRECTOR PROVIDES WRITTEN CONSENT- If, on or after the date an order is issued under this section which removes or suspends from office any regulated entity-affiliated party or prohibits such party from participating in the conduct of the affairs of a regulated entity, such party receives the written consent of the Director, the order shall, to the extent of such consent, cease to apply to such party with respect to the regulated entity described in the written consent. If the Director grants such a written consent, it shall publicly disclose such consent.CommentsClose CommentsPermalink
`(3) VIOLATION OF PARAGRAPH (1) TREATED AS VIOLATION OF ORDER- Any violation of paragraph (1) by any person who is subject to an order described in such subsection shall be treated as a violation of the order.CommentsClose CommentsPermalink
`(f) Applicability- This section shall only apply to a person who is an individual, unless the Director specifically finds that it should apply to a corporation, firm, or other business enterprise.CommentsClose CommentsPermalink
`(g) Stay of Suspension and Prohibition of Regulated Entity-Affiliated Party- Within 10 days after any regulated entity-affiliated party has been suspended from office and/or prohibited from participation in the conduct of the affairs of a regulated entity under this section, such party may apply to the United States District Court for the District of Columbia, or the United States district court for the judicial district in which the headquarters of the regulated entity is located, for a stay of such suspension and/or prohibition and any prohibition under subsection (b)(1)(B) pending the completion of the administrative proceedings pursuant to the notice served upon such party under this section, and such court shall have jurisdiction to stay such suspension and/or prohibition.CommentsClose CommentsPermalink
`(h) Suspension or Removal of Regulated Entity-Affiliated Party Charged With Felony-CommentsClose CommentsPermalink
`(1) SUSPENSION OR PROHIBITION-CommentsClose CommentsPermalink
`(A) IN GENERAL- Whenever any regulated entity-affiliated party is charged in any information, indictment, or complaint, with the commission of or participation in a crime involving dishonesty or breach of trust which is punishable by imprisonment for a term exceeding one year under State or Federal law, the Director may, if continued service or participation by such party may pose a threat to the regulated entity or impair public confidence in the regulated entity, by written notice served upon such party--CommentsClose CommentsPermalink
`(i) suspend such party from office or prohibit such party from further participation in any manner in the conduct of the affairs of any regulated entity; andCommentsClose CommentsPermalink
`(ii) prohibit the regulated entity from releasing to or on behalf of the regulated entity-affiliated party any compensation or other payment of money or other thing of current or potential value in connection with the period of any such suspension or with any resignation, removal, retirement, or other termination of employment or office of the party.CommentsClose CommentsPermalink
`(B) PROVISIONS APPLICABLE TO NOTICE-CommentsClose CommentsPermalink
`(i) COPY- A copy of any notice under paragraph (1)(A) shall also be served upon the regulated entity.CommentsClose CommentsPermalink
`(ii) EFFECTIVE PERIOD- A suspension or prohibition under subparagraph (A) shall remain in effect until the information, indictment, or complaint referred to in such subparagraph is finally disposed of or until terminated by the Director.CommentsClose CommentsPermalink
`(2) REMOVAL OR PROHIBITION-CommentsClose CommentsPermalink
`(A) IN GENERAL- If a judgment of conviction or an agreement to enter a pretrial diversion or other similar program is entered against a regulated entity-affiliated party in connection with a crime described in paragraph (1)(A), at such time as such judgment is not subject to further appellate review, the Director may, if continued service or participation by such party may pose a threat to the regulated entity or impair public confidence in the regulated entity, issue and serve upon such party an order that--CommentsClose CommentsPermalink
`(i) removes such party from office or prohibits such party from further participation in any manner in the conduct of the affairs of the regulated entity without the prior written consent of the Director; andCommentsClose CommentsPermalink
`(ii) prohibits the regulated entity from releasing to or on behalf of the regulated entity-affiliated party any compensation or other payment of money or other thing of current or potential value in connection with the termination of employment or office of the party.CommentsClose CommentsPermalink
`(B) PROVISIONS APPLICABLE TO ORDER-CommentsClose CommentsPermalink
`(i) COPY- A copy of any order under paragraph (2)(A) shall also be served upon the regulated entity, whereupon the regulated entity-affiliated party who is subject to the order (if a director or an officer) shall cease to be a director or officer of such regulated entity.CommentsClose CommentsPermalink
`(ii) EFFECT OF ACQUITTAL- A finding of not guilty or other disposition of the charge shall not preclude the Director from instituting proceedings after such finding or disposition to remove such party from office or to prohibit further participation in regulated entity affairs, and to prohibit compensation or other payment of money or other thing of current or potential value in connection with any resignation, removal, retirement, or other termination of employment or office of the party, pursuant to subsections (a), (d), or (e) of this section.CommentsClose CommentsPermalink
`(iii) EFFECTIVE PERIOD- Any notice of suspension or order of removal issued under this subsection shall remain effective and outstanding until the completion of any hearing or appeal authorized under paragraph (4) unless terminated by the Director.CommentsClose CommentsPermalink
`(3) AUTHORITY OF REMAINING BOARD MEMBERS- If at any time, because of the suspension of one or more directors pursuant to this section, there shall be on the board of directors of a regulated entity less than a quorum of directors not so suspended, all powers and functions vested in or exercisable by such board shall vest in and be exercisable by the director or directors on the board not so suspended, until such time as there shall be a quorum of the board of directors. In the event all of the directors of a regulated entity are suspended pursuant to this section, the Director shall appoint persons to serve temporarily as directors in their place and stead pending the termination of such suspensions, or until such time as those who have been suspended cease to be directors of the regulated entity and their respective successors take office.CommentsClose CommentsPermalink
`(4) HEARING REGARDING CONTINUED PARTICIPATION- Within 30 days from service of any notice of suspension or order of removal issued pursuant to paragraph (1) or (2) of this subsection, the regulated entity-affiliated party concerned may request in writing an opportunity to appear before the Director to show that the continued service to or participation in the conduct of the affairs of the regulated entity by such party does not, or is not likely to, pose a threat to the interests of the regulated entity or threaten to impair public confidence in the regulated entity. Upon receipt of any such request, the Director shall fix a time (not more than 30 days after receipt of such request, unless extended at the request of such party) and place at which such party may appear, personally or through counsel, before one or more members of the Director or designated employees of the Director to submit written materials (or, at the discretion of the Director, oral testimony) and oral argument. Within 60 days of such hearing, the Director shall notify such party whether the suspension or prohibition from participation in any manner in the conduct of the affairs of the regulated entity will be continued, terminated, or otherwise modified, or whether the order removing such party from office or prohibiting such party from further participation in any manner in the conduct of the affairs of the regulated entity, and prohibiting compensation in connection with termination will be rescinded or otherwise modified. Such notification shall contain a statement of the basis for the Director's decision, if adverse to such party. The Director is authorized to prescribe such rules as may be necessary to effectuate the purposes of this subsection.CommentsClose CommentsPermalink
`(i) Hearings and Judicial Review-CommentsClose CommentsPermalink
`(1) VENUE AND PROCEDURE- Any hearing provided for in this section shall be held in the District of Columbia or in the Federal judicial district in which the headquarters of the regulated entity is located, unless the party afforded the hearing consents to another place, and shall be conducted in accordance with the provisions of chapter 5 of title 5, United States Code. After such hearing, and within 90 days after the Director has notified the parties that the case has been submitted to it for final decision, it shall render its decision (which shall include findings of fact upon which its decision is predicated) and shall issue and serve upon each party to the proceeding an order or orders consistent with the provisions of this section. Judicial review of any such order shall be exclusively as provided in this subsection. Unless a petition for review is timely filed in a court of appeals of the United States, as provided in paragraph (2), and thereafter until the record in the proceeding has been filed as so provided, the Director may at any time, upon such notice and in such manner as it shall deem proper, modify, terminate, or set aside any such order. Upon such filing of the record, the Director may modify, terminate, or set aside any such order with permission of the court.CommentsClose CommentsPermalink
`(2) REVIEW OF ORDER- Any party to any proceeding under paragraph (1) may obtain a review of any order served pursuant to paragraph (1) (other than an order issued with the consent of the regulated entity or the regulated entity-affiliated party concerned, or an order issued under subsection (h) of this section) by the filing in the United States Court of Appeals for the District of Columbia Circuit or court of appeals of the United States for the circuit in which the headquarters of the regulated entity is located, within 30 days after the date of service of such order, a written petition praying that the order of the Director be modified, terminated, or set aside. A copy of such petition shall be forthwith transmitted by the clerk of the court to the Director, and thereupon the Director shall file in the court the record in the proceeding, as provided in
`(3) PROCEEDINGS NOT TREATED AS STAY- The commencement of proceedings for judicial review under paragraph (2) shall not, unless specifically ordered by the court, operate as a stay of any order issued by the Director.'.CommentsClose CommentsPermalink
(b) Conforming Amendments-CommentsClose CommentsPermalink
(1) 1992 ACT- Section 1317(f) of the Housing and Community Development Act of 1992 (
(2) FANNIE MAE CHARTER ACT- The second sentence of subsection (b) of section 308 of the Federal National Mortgage Association Charter Act (
(3) FREDDIE MAC ACT- The second sentence of subparagraph (A) of section 303(a)(2) of the Federal Home Loan Mortgage Corporation Act (
SEC. 167. CRIMINAL PENALTY.
Subtitle C of title XIII of the Housing and Community Development Act of 1992 (
`SEC. 1378. CRIMINAL PENALTY.
`Whoever, being subject to an order in effect under section 1377, without the prior written approval of the Director, knowingly participates, directly or indirectly, in any manner (including by engaging in an activity specifically prohibited in such an order) in the conduct of the affairs of any regulated entity shall, notwithstanding section 3571 of title 18, be fined not more than $1,000,000, imprisoned for not more than 5 years, or both.'.CommentsClose CommentsPermalink
SEC. 168. SUBPOENA AUTHORITY.
Section 1379D(c) of the Housing and Community Development Act of 1992 (
(1) by striking `request the Attorney General of the United States to' and inserting `, in the discretion of the Director,';CommentsClose CommentsPermalink
(2) by inserting `or request that the Attorney General of the United States bring such an action,' after `District of Columbia,'; andCommentsClose CommentsPermalink
(3) by striking `or may, under the direction and control of the Attorney General, bring such an action'.CommentsClose CommentsPermalink
SEC. 169. CONFORMING AMENDMENTS.
Subtitle C of title XIII of the Housing and Community Development Act of 1992 (
(1) in section 1372(c)(1) (
(2) in section 1379 (
(A) by inserting `, or of a regulated entity-affiliated party,' before `shall not affect'; andCommentsClose CommentsPermalink
(B) by striking `such director or executive officer' each place such term appears and inserting `such director, executive officer, or regulated entity-affiliated party';CommentsClose CommentsPermalink
(3) in section 1379A (
(4) by striking `An enterprise' each place such term appears in such subtitle and inserting `A regulated entity';CommentsClose CommentsPermalink
(5) by striking `an enterprise' each place such term appears in such subtitle and inserting `a regulated entity';CommentsClose CommentsPermalink
(6) by striking `the enterprise' each place such term appears in such subtitle and inserting `the regulated entity'; andCommentsClose CommentsPermalink
(7) by striking `any enterprise' each place such term appears in such subtitle and inserting `any regulated entity'.CommentsClose CommentsPermalink
Subtitle E--General Provisions
SEC. 181. BOARDS OF ENTERPRISES.
(a) Fannie Mae-CommentsClose CommentsPermalink
(1) IN GENERAL- Section 308(b) of the Federal National Mortgage Association Charter Act (
(A) in the first sentence, by striking `eighteen persons, five of whom shall be appointed annually by the President of the United States, and the remainder of whom' and inserting `13 persons, or such other number that the Director determines appropriate, who';CommentsClose CommentsPermalink
(B) in the second sentence, by striking `appointed by the President';CommentsClose CommentsPermalink
(C) in the third sentence--CommentsClose CommentsPermalink
(i) by striking `appointed or'; andCommentsClose CommentsPermalink
(ii) by striking `, except that any such appointed member may be removed from office by the President for good cause';CommentsClose CommentsPermalink
(D) in the fourth sentence, by striking `elective'; andCommentsClose CommentsPermalink
(E) by striking the fifth sentence.CommentsClose CommentsPermalink
(2) TRANSITIONAL PROVISION- The amendments made by paragraph (1) shall not apply to any appointed position of the board of directors of the Federal National Mortgage Association until the expiration of the annual term for such position during which the effective date under Section 185 occurs.CommentsClose CommentsPermalink
(b) Freddie Mac-CommentsClose CommentsPermalink
(1) IN GENERAL- Section 303(a)(2) of the Federal Home Loan Mortgage Corporation Act (
(A) in subparagraph (A)--CommentsClose CommentsPermalink
(i) in the first sentence, by striking `18 persons, 5 of whom shall be appointed annually by the President of the United States and the remainder of whom' and inserting `13 persons, or such other number as the Director determines appropriate, who'; andCommentsClose CommentsPermalink
(ii) in the second sentence, by striking `appointed by the President of the United States';CommentsClose CommentsPermalink
(B) in subparagraph (B)--CommentsClose CommentsPermalink
(i) by striking `such or'; andCommentsClose CommentsPermalink
(ii) by striking `, except that any appointed member may be removed from office by the President for good cause'; andCommentsClose CommentsPermalink
(C) in subparagraph (C)--CommentsClose CommentsPermalink
(i) by striking the first sentence; andCommentsClose CommentsPermalink
(ii) by striking `elective'.CommentsClose CommentsPermalink
(2) TRANSITIONAL PROVISION- The amendments made by paragraph (1) shall not apply to any appointed position of the board of directors of the Federal Home Loan Mortgage Corporation until the expiration of the annual term for such position during which the effective date under Section 185 occurs.CommentsClose CommentsPermalink
SEC. 182. REPORT ON PORTFOLIO OPERATIONS, SAFETY AND SOUNDNESS, AND MISSION OF ENTERPRISES.
Not later than the expiration of the 12-month period beginning on the effective date under section 185, the Director of the Federal Housing Finance Agency shall submit a report to the Congress which shall include--CommentsClose CommentsPermalink
(1) a description of the portfolio holdings of the enterprises (as such term is defined in section 1303 of the Housing and Community Development Act of 1992 (
(2) a description of the risk implications for the enterprises of such holdings and the consequent risk management undertaken by the enterprises (including the use of derivatives for hedging purposes), compared with off-balance sheet liabilities of the enterprises (including mortgage-backed securities guaranteed by the enterprises);CommentsClose CommentsPermalink
(3) an analysis of portfolio holdings for safety and soundness purposes;CommentsClose CommentsPermalink
(4) an assessment of whether portfolio holdings fulfill the mission purposes of the enterprises under the Federal National Mortgage Association Charter Act and the Federal Home Loan Mortgage Corporation Act; andCommentsClose CommentsPermalink
(5) an analysis of the potential systemic risk implications for the enterprises, the housing and capital markets, and the financial system of portfolio holdings, and whether such holdings should be limited or reduced over time.CommentsClose CommentsPermalink
SEC. 183. CONFORMING AND TECHNICAL AMENDMENTS.
(a) 1992 Act- Title XIII of the Housing and Community Development Act of 1992 is amended by striking section 1383 (
(b) Title 18, United States Code-
(c) Flood Disaster Protection Act of 1973- Section 102(f)(3)(A) of the Flood Disaster Protection Act of 1973 (
(d) Department of Housing and Urban Development Act- Section 5 of the Department of Housing and Urban Development Act (
(e) Title 5, United States Code-CommentsClose CommentsPermalink
(1) Director's PAY RATE-
`Director of the Federal Housing Finance Agency.'.CommentsClose CommentsPermalink
(2) EXCLUSION FROM SENIOR EXECUTIVE SERVICE-
(A) by striking `the Federal Housing Finance Board,'; andCommentsClose CommentsPermalink
(B) by striking `the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development' and inserting `the Federal Housing Finance Agency'.CommentsClose CommentsPermalink
(f) Inspector General Act of 1978- Section 8G(a)(2) of the Inspector General Act of 1978 (5 U.S.C. App.) is amended by striking `Federal Housing Finance Board' and inserting `Federal Housing Finance Agency'.CommentsClose CommentsPermalink
(g) Federal Deposit Insurance Act- Section 11(t)(2)(A) of the Federal Deposit Insurance Act (12 U.S.C.1821(t)(2)(A)) is amended by adding at the end the following new clause:CommentsClose CommentsPermalink
`(vii) The Federal Housing Finance Agency.'.CommentsClose CommentsPermalink
(h) 1997 Emergency Supplemental Appropriations Act- Section 10001 of the 1997 Emergency Supplemental Appropriations Act for Recovery From Natural Disasters, and for Overseas Peacekeeping Efforts, Including Those In Bosnia (
(1) by striking `the Government National Mortgage Association, and the Office of Federal Housing Enterprise Oversight' and inserting `and the Government National Mortgage Association'; andCommentsClose CommentsPermalink
(2) by striking `, the Government National Mortgage Association, or the Office of Federal Housing Enterprise Oversight' and inserting `or the Government National Mortgage Association'.CommentsClose CommentsPermalink
(i) National Homeownership Trust Act- Section 302(b)(4) of the Cranston-Gonzalez National Affordable Housing Act (
SEC. 184. STUDY OF ALTERNATIVE SECONDARY MARKET SYSTEMS.
(a) In General- The Director of the Federal Housing Finance Agency, in consultation with the Board of Governors of the Federal Reserve System, the Secretary of the Treasury, and the Secretary of Housing and Urban Development, shall conduct a comprehensive study of the effects on financial and housing finance markets of alternatives to the current secondary market system for housing finance, taking into consideration changes in the structure of financial and housing finance markets and institutions since the creation of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.CommentsClose CommentsPermalink
(b) Contents- The study under this section shall--CommentsClose CommentsPermalink
(1) include, among the alternatives to the current secondary market system analyzed--CommentsClose CommentsPermalink
(A) repeal of the chartering Acts for the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation;CommentsClose CommentsPermalink
(B) establishing bank-like mechanisms for granting new charters for limited purposed mortgage securitization entities;CommentsClose CommentsPermalink
(C) permitting the Director of the Federal Housing Finance Agency to grant new charters for limited purpose mortgage securitization entities, which shall include analyzing the terms on which such charters should be granted, including whether such charters should be sold, or whether such charters and the charters for the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation should be taxed or otherwise assessed a monetary price; andCommentsClose CommentsPermalink
(D) such other alternatives as the Director considers appropriate;CommentsClose CommentsPermalink
(2) examine all of the issues involved in making the transition to a completely private secondary mortgage market system;CommentsClose CommentsPermalink
(3) examine the technological advancements the private sector has made in providing liquidity in the secondary mortgage market and how such advancements have affected liquidity in the secondary mortgage market; andCommentsClose CommentsPermalink
(4) examine how taxpayers would be impacted by each alternative system, including the complete privatization of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.CommentsClose CommentsPermalink
(c) Report- The Director of the Federal Housing Finance Agency shall submit a report to the Congress on the study not later than the expiration of the 24-month period beginning on the effective date under section 185.CommentsClose CommentsPermalink
SEC. 185. EFFECTIVE DATE.
Except as specifically provided otherwise in this title, this title shall take effect on and the amendments made by this title shall take effect on, and shall apply beginning on, the expiration of the 6-month period beginning on the date of the enactment of this Act.CommentsClose CommentsPermalink
TITLE II--FEDERAL HOME LOAN BANKS
SEC. 201. DEFINITIONS.
Section 2 of the Federal Home Loan Bank Act (
(1) by striking paragraphs (1), (10), and (11);CommentsClose CommentsPermalink
(2) by redesignating paragraphs (2) through (9) as paragraphs (1) through (8), respectively;CommentsClose CommentsPermalink
(3) by redesignating paragraphs (12) and (13) as paragraphs (9) and (10), respectively; andCommentsClose CommentsPermalink
(4) by adding at the end the following:CommentsClose CommentsPermalink
`(11) DIRECTOR- The term `Director' means the Director of the Federal Housing Finance Agency.CommentsClose CommentsPermalink
`(12) AGENCY- The term `Agency' means the Federal Housing Finance Agency.'.CommentsClose CommentsPermalink
SEC. 202. DIRECTORS.
(a) Election- Section 7 of the Federal Home Loan Bank Act (
(1) by striking subsection (a) and inserting the following:CommentsClose CommentsPermalink
`(a) Number; Election; Qualifications; Conflicts of Interest-CommentsClose CommentsPermalink
`(1) IN GENERAL- The management of each Federal Home Loan Bank shall be vested in a board of 13 directors, or such other number as the Director determines appropriate, each of whom shall be a citizen of the United States. All directors of a Bank who are not independent directors pursuant to paragraph (3) shall be elected by the members.CommentsClose CommentsPermalink
`(2) MEMBER DIRECTORS- A majority of the directors of each Bank shall be officers or directors of a member of such Bank that is located in the district in which such Bank is located.CommentsClose CommentsPermalink
`(3) INDEPENDENT DIRECTORS- At least two-fifths of the directors of each Bank shall be independent directors, who shall be appointed by the Director of the Federal Housing Finance Agency from a list of individuals recommended by the Federal Housing Enterprise Board. The Federal Housing Enterprise Board may recommend individuals who are identified by the Board's own independent process or included on a list of individuals recommended by the board of directors of the Bank involved, which shall be submitted to the Federal Housing Enterprise Board by such board of directors. The number of individuals on any such list submitted by a Bank's board of directors shall be equal to at least two times the number of independent directorships to be filled. All independent directors appointed shall meet the following criteria:CommentsClose CommentsPermalink
`(A) IN GENERAL- Each independent director shall be a bona fide resident of the district in which such Bank is located.CommentsClose CommentsPermalink
`(B) PUBLIC INTEREST DIRECTORS- At least 2 of the independent directors under this paragraph of each Bank shall be representatives chosen from organizations with more than a 2-year history of representing consumer or community interests on banking services, credit needs, housing, community development, economic development, or financial consumer protections.CommentsClose CommentsPermalink
`(C) OTHER DIRECTORS-CommentsClose CommentsPermalink
`(i) QUALIFICATIONS- Each independent director that is not a public interest director under subparagraph (B) shall have demonstrated knowledge of, or experience in, financial management, auditing and accounting, risk management practices, derivatives, project development, or organizational management, or such other knowledge or expertise as the Director may provide by regulation.CommentsClose CommentsPermalink
`(ii) CONSULTATION WITH BANKS- In appointing other directors to serve on the board of a Federal home loan bank, the Director of the Federal Housing Finance Agency may consult with each Federal home loan bank about the knowledge, skills, and expertise needed to assist the board in better fulfilling its responsibilities.CommentsClose CommentsPermalink
`(D) CONFLICTS OF INTEREST- Notwithstanding subsection (f)(2), an independent director under this paragraph of a Bank may not, during such director's term of office, serve as an officer of any Federal Home Loan Bank or as a director or officer of any member of a Bank.CommentsClose CommentsPermalink
`(E) COMMUNITY DEMOGRAPHICS- In appointing independent directors of a Bank pursuant to this paragraph, the Director shall take into consideration the demographic makeup of the community most served by the Affordable Housing Program of the Bank pursuant to section 10(j).';CommentsClose CommentsPermalink
(2) in the first sentence of subsection (b), by striking `elective directorship' and inserting `member directorship established pursuant to subsection (a)(2)';CommentsClose CommentsPermalink
(3) in subsection (c)--CommentsClose CommentsPermalink
(A) by striking `elective' each place such term appears and inserting `member', except--CommentsClose CommentsPermalink
(i) in the second sentence, the second place such term appears; andCommentsClose CommentsPermalink
(ii) each place such term appears in the fifth sentence;CommentsClose CommentsPermalink
(B) in the first sentence, by inserting after `less than one' the following: `or two, as determined by the board of directors of the appropriate Federal home loan bank,'; andCommentsClose CommentsPermalink
(C) in the second sentence--CommentsClose CommentsPermalink
(i) by inserting `(A) except as provided in clause (B) of this sentence,' before `if at any time'; andCommentsClose CommentsPermalink
(ii) by inserting before the period at the end the following: `, and (B) clause (A) of this sentence shall not apply to the directorships of any Federal home loan bank resulting from the merger of any two or more such banks'; andCommentsClose CommentsPermalink
(4) by striking `elective' each place such term appears (except in subsections (c), (e), and (f)).CommentsClose CommentsPermalink
(b) Terms-CommentsClose CommentsPermalink
(1) IN GENERAL- Section 7(d) of the Federal Home Loan Bank Act (
(A) in the first sentence, by striking `3 years' and inserting `4 years'; andCommentsClose CommentsPermalink
(B) in the second sentence--CommentsClose CommentsPermalink
(i) by striking `Federal Home Loan Bank System Modernization Act of 1999' and inserting `Federal Housing Finance Reform Act of 2007'; andCommentsClose CommentsPermalink
(ii) by striking `1/3' and inserting `1/4'.CommentsClose CommentsPermalink
(2) SAVINGS PROVISION- The amendments made by paragraph (1) shall not apply to the term of office of any director of a Federal home loan bank who is serving as of the effective date of this title under section 211, including any director elected to fill a vacancy in any such office.CommentsClose CommentsPermalink
(c) Continued Service of Independent Directors After Expiration of Term- Section 7(f)(2) of the Federal Home Loan Bank Act (
(1) in the second sentence, by striking `or the term of such office expires, whichever occurs first';CommentsClose CommentsPermalink
(2) by adding at the end the following new sentence: `An independent Bank director may continue to serve as a director after the expiration of the term of such director until a successor is appointed.';CommentsClose CommentsPermalink
(3) in the paragraph heading, by striking `APPOINTED' and inserting `INDEPENDENT'; andCommentsClose CommentsPermalink
(4) by striking `appointive' each place such term appears and inserting `independent'.CommentsClose CommentsPermalink
(d) Conforming Amendments- Section 7(f)(3) of the Federal Home Loan Bank Act (
(1) in the paragraph heading, by striking `ELECTED' and inserting `MEMBER'; andCommentsClose CommentsPermalink
(2) by striking `elective' each place such term appears in the first and third sentences and inserting `member'.CommentsClose CommentsPermalink
(e) Compensation- Subsection (i) of section 7 of the Federal Home Loan Bank Act (
`(i) Directors' Compensation-CommentsClose CommentsPermalink
`(1) IN GENERAL- Each Federal home loan bank may pay the directors on the board of directors for the bank reasonable and appropriate compensation for the time required of such directors, and reasonable and appropriate expenses incurred by such directors, in connection with service on the board of directors, in accordance with resolutions adopted by the board of directors and subject to the approval of the Director.CommentsClose CommentsPermalink
`(2) ANNUAL REPORT BY THE BOARD- The Director shall include, in the annual report submitted to the Congress pursuant to section 1319B of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, information regarding the compensation and expenses paid by the Federal home loan banks to the directors on the boards of directors of the banks.'.CommentsClose CommentsPermalink
(f) Transition Rule- Any member of the board of directors of a Federal Home Loan Bank serving as of the effective date under section 211 may continue to serve as a member of such board of directors for the remainder of the term of such office as provided in section 7 of the Federal Home Loan Bank Act, as in effect before such effective date.CommentsClose CommentsPermalink
SEC. 203. FEDERAL HOUSING FINANCE AGENCY OVERSIGHT OF FEDERAL HOME LOAN BANKS.
The Federal Home Loan Bank Act (
(1) by striking sections 2A and 2B (
(2) in section 6 (
(A) in subsection (b)(1), in the matter preceding subparagraph (A), by striking `Finance Board approval' and inserting `approval by the Director'; andCommentsClose CommentsPermalink
(B) in each of subsections (c)(4)(B) and (d)(2), by striking `Finance Board regulations' each place that term appears and inserting `regulations of the Director';CommentsClose CommentsPermalink
(3) in section 8 (
(4) in section 10(b) (
(5) in section 10 (
`(k) Monitoring and Enforcing Compliance With Affordable Housing and Community Investment Program Requirements- The requirements under subsection (i) and (j) that the Banks establish Community Investment and Affordable Housing Programs, respectively, and contribute to the Affordable Housing Program, shall be enforceable by the Director with respect to the Banks in the same manner and to the same extent as the housing goals under subpart B of part 2 of subtitle A of title XIII of the Housing and Community Development Act of 1992 (
(6) in section 11 (
(A) in subsection (b)--CommentsClose CommentsPermalink
(i) in the first sentence--CommentsClose CommentsPermalink
(I) by striking `The Board' and inserting `The Office of Finance, as agent for the Banks,'; andCommentsClose CommentsPermalink
(II) by striking `the Board' and inserting `such Office'; andCommentsClose CommentsPermalink
(ii) in the second and fourth sentences, by striking `the Board' each place such term appears and inserting `the Office of Finance';CommentsClose CommentsPermalink
(B) in subsection (c)--CommentsClose CommentsPermalink
(i) by striking `the Board' the first place such term appears and inserting `the Office of Finance, as agent for the Banks,'; andCommentsClose CommentsPermalink
(ii) by striking `the Board' the second place such term appears and inserting `such Office'; andCommentsClose CommentsPermalink
(C) in subsection (f)--CommentsClose CommentsPermalink
(i) by striking the two commas after `permit' and inserting `or'; andCommentsClose CommentsPermalink
(ii) by striking the comma after `require';CommentsClose CommentsPermalink
(7) in section 15 (
(8) in section 18 (
(9) in section 21 (
(A) in subsection (b)--CommentsClose CommentsPermalink
(i) in paragraph (5), by striking `Chairperson of the Federal Housing Finance Board' and inserting `Director'; andCommentsClose CommentsPermalink
(ii) in the heading for paragraph (8), by striking `FEDERAL HOUSING FINANCE BOARD' and inserting `DIRECTOR'; andCommentsClose CommentsPermalink
(B) in subsection (i), in the heading for paragraph (2), by striking `FEDERAL HOUSING FINANCE BOARD' and inserting `DIRECTOR';CommentsClose CommentsPermalink
(10) in section 23 (
(11) by striking `the Board' each place such term appears in such Act (except in section 15 (
(12) by striking `The Board' each place such term appears in such Act (except in sections 7(e) (
(13) by striking `the Board's' each place such term appears in such Act and inserting `the Director's';CommentsClose CommentsPermalink
(14) by striking `The Board's' each place such term appears in such Act and inserting `The Director's';CommentsClose CommentsPermalink
(15) by striking `the Finance Board' each place such term appears in such Act and inserting `the Director';CommentsClose CommentsPermalink
(16) by striking `Federal Housing Finance Board' each place such term appears and inserting `Director';CommentsClose CommentsPermalink
(17) in section 11(i) (
(18) in section 21(e)(9) (
SEC. 204. JOINT ACTIVITIES OF BANKS.
Section 11 of the Federal Home Loan Bank Act (
`(l) Joint Activities- Subject to the regulation of the Director, any two or more Federal Home Loan Banks may establish a joint office for the purpose of performing functions for, or providing services to, the Banks on a common or collective basis, or may require that the Office of Finance perform such functions or services, but only if the Banks are otherwise authorized to perform such functions or services individually.'.CommentsClose CommentsPermalink
SEC. 205. SHARING OF INFORMATION BETWEEN FEDERAL HOME LOAN BANKS.
(a) In General- The Federal Home Loan Bank Act is amended by inserting after section 20 (
`SEC. 20A. SHARING OF INFORMATION BETWEEN FEDERAL HOME LOAN BANKS.
`(a) Regulatory Authority- The Director shall prescribe such regulations as may be necessary to ensure that each Federal Home Loan Bank has access to information that the Bank needs to determine the nature and extent of its joint and several liability.CommentsClose CommentsPermalink
`(b) No Waiver of Privilege- The Director shall not be deemed to have waived any privilege applicable to any information concerning a Federal Home Loan Bank by transferring, or permitting the transfer of, that information to any other Federal Home Loan Bank for the purpose of enabling the recipient to evaluate the nature and extent of its joint and several liability.'.CommentsClose CommentsPermalink
(b) Regulations- The regulations required under the amendment made by subsection (a) shall be issued in final form not later than 6 months after the effective date under section 211 of this Act.CommentsClose CommentsPermalink
SEC. 206. REORGANIZATION OF BANKS AND VOLUNTARY MERGER.
Section 26 of the Federal Home Loan Bank Act (
(1) by inserting `(a) Reorganization- ' before `Whenever'; andCommentsClose CommentsPermalink
(2) by striking `liquidated or' each place such phrase appears;CommentsClose CommentsPermalink
(3) by striking `liquidation or'; andCommentsClose CommentsPermalink
(4) by adding at the end the following new subsection:CommentsClose CommentsPermalink
`(b) Voluntary Mergers- Any two or more Banks may, with the approval of the Director, and the approval of the boards of directors of the Banks involved, merge. The Director shall promulgate regulations establishing the conditions and procedures for the consideration and approval of any such voluntary merger, including the procedures for Bank member approval.'.CommentsClose CommentsPermalink
SEC. 207. SECURITIES AND EXCHANGE COMMISSION DISCLOSURE.
(a) In General- The Federal Home Loan Banks shall be exempt from compliance with--CommentsClose CommentsPermalink
(1) sections 13(e), 14(a), 14(c), and 17A of the Securities Exchange Act of 1934 and related Commission regulations; andCommentsClose CommentsPermalink
(2) section 15 of that Act and related Securities and Exchange Commission regulations with respect to transactions in capital stock of the Banks.CommentsClose CommentsPermalink
(b) Member Exemption- The members of the Federal Home Loan Banks shall be exempt from compliance with sections 13(d), 13(f), 13(g), 14(d), and 16 of the Securities Exchange Act of 1934 and related Securities and Exchange Commission regulations with respect to their ownership of, or transactions in, capital stock of the Federal Home Loan Banks.CommentsClose CommentsPermalink
(c) Exempted and Government Securities-CommentsClose CommentsPermalink
(1) CAPITAL STOCK- The capital stock issued by each of the Federal Home Loan Banks under section 6 of the Federal Home Loan Bank Act are--CommentsClose CommentsPermalink
(A) exempted securities within the meaning of section 3(a)(2) of the Securities Act of 1933; andCommentsClose CommentsPermalink
(B) `exempted securities' within the meaning of section 3(a)(12)(A) of the Securities Exchange Act of 1934.CommentsClose CommentsPermalink
(2) OTHER OBLIGATIONS- The debentures, bonds, and other obligations issued under section 11 of the Federal Home Loan Bank Act are--CommentsClose CommentsPermalink
(A) exempted securities within the meaning of section 3(a)(2) of the Securities Act of 1933;CommentsClose CommentsPermalink
(B) `government securities' within the meaning of section 3(a)(42) of the Securities Exchange Act of 1934;CommentsClose CommentsPermalink
(C) excluded from the definition of `government securities broker' within section 3(a)(43) of the Securities Exchange Act of 1934;CommentsClose CommentsPermalink
(D) excluded from the definition of `government securities dealer' within section 3(a)(44) of the Securities Exchange Act of 1934; andCommentsClose CommentsPermalink
(E) `government securities' within the meaning of section 2(a)(16) of the Investment Company Act of 1940.CommentsClose CommentsPermalink
(d) Exemption From Reporting Requirements- The Federal Home Loan Banks shall be exempt from periodic reporting requirements pertaining to--CommentsClose CommentsPermalink
(1) the disclosure of related party transactions that occur in the ordinary course of business of the Banks with their members; andCommentsClose CommentsPermalink
(2) the disclosure of unregistered sales of equity securities.CommentsClose CommentsPermalink
(e) Tender Offers- The Securities and Exchange Commission's rules relating to tender offers shall not apply in connection with transactions in capital stock of the Federal Home Loan Banks.CommentsClose CommentsPermalink
(f) Regulations- In issuing any final regulations to implement provisions of this section, the Securities and Exchange Commission shall consider the distinctive characteristics of the Federal Home Loan Banks when evaluating the accounting treatment with respect to the payment to Resolution Funding Corporation, the role of the combined financial statements of the twelve Banks, the accounting classification of redeemable capital stock, and the accounting treatment related to the joint and several nature of the obligations of the Banks.CommentsClose CommentsPermalink
SEC. 208. COMMUNITY FINANCIAL INSTITUTION MEMBERS.
(a) Total Asset Requirement- Paragraph (10) of section 2 of the Federal Home Loan Bank Act (
(b) Use of Advances for Community Development Activities- Section 10(a) of the Federal Home Loan Bank Act (
(1) in paragraph (2)(B)--CommentsClose CommentsPermalink
(A) by striking `and'; andCommentsClose CommentsPermalink
(B) by inserting `, and community development activities' before the period at the end;CommentsClose CommentsPermalink
(2) in paragraph (3)(E), by inserting `or community development activities' after `agriculture,'; andCommentsClose CommentsPermalink
(3) in paragraph (6)--CommentsClose CommentsPermalink
(A) by striking `and'; andCommentsClose CommentsPermalink
(B) by inserting `, and `community development activities' before `shall'.CommentsClose CommentsPermalink
SEC. 209. TECHNICAL AND CONFORMING AMENDMENTS.
(a) Right to Financial Privacy Act of 1978- Section 1113(o) of the Right to Financial Privacy Act of 1978 (
(1) by striking `Federal Housing Finance Board' and inserting `Federal Housing Finance Agency'; andCommentsClose CommentsPermalink
(2) by striking `Federal Housing Finance Board's' and inserting `Federal Housing Finance Agency's'.CommentsClose CommentsPermalink
(b) Riegle Community Development and Regulatory Improvement Act of 1994- Section 117(e) of the Riegle Community Development and Regulatory Improvement Act of 1994 (
(c) Title 18, United States Code- Title 18, United States Code, is amended by striking `Federal Housing Finance Board' each place such term appears in each of sections 212, 657, 1006, 1014, and inserting `Federal Housing Finance Agency'.CommentsClose CommentsPermalink
(d) MARA Act of 1997- Section 517(b)(4) of the Multifamily Assisted Housing Reform and Affordability Act of 1997 (
(e) Title 44, United States Code-
(f) Access to Local TV Act of 2000- Section 1004(d)(2)(D)(iii) of the Launching Our Communities' Access to Local Television Act of 2000 (
(g) Sarbanes-Oxley Act of 2002- Section 105(b)(5)(B)(ii)(II) of the Sarbanes-Oxley Act of 2002 (
SEC. 210. STUDY OF AFFORDABLE HOUSING PROGRAM USE FOR LONG-TERM CARE FACILITIES.
The Comptroller General shall conduct a study of the use of affordable housing programs of the Federal home loan banks under section 10(j) of the Federal Home Loan Bank Act to determine how and the extent to which such programs are used to assist long-term care facilities for low- and moderate-income individuals, and the effectiveness and adequacy of such assistance in meeting the needs of affected communities. The study shall examine the applicability of such use to the affordable housing programs required to be established by the enterprises pursuant to the amendment made by section 139 of this Act. The Comptroller General shall submit a report to the Director of the Federal Housing Finance Agency and the Congress regarding the results of the study not later than the expiration of the 1-year period beginning on the date of the enactment of this Act. This section shall take effect on the date of the enactment of this Act.CommentsClose CommentsPermalink
SEC. 211. EFFECTIVE DATE.
Except as specifically provided otherwise in this title, this title shall take effect on and the amendments made by this title shall take effect on, and shall apply beginning on, the expiration of the 6-month period beginning on the date of the enactment of this Act.CommentsClose CommentsPermalink
TITLE III--TRANSFER OF FUNCTIONS, PERSONNEL, AND PROPERTY OF OFFICE OF FEDERAL HOUSING ENTERPRISE OVERSIGHT, FEDERAL HOUSING FINANCE BOARD, AND DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Subtitle A--Office of Federal Housing Enterprise Oversight
SEC. 301. ABOLISHMENT OF OFHEO.
(a) In General- Effective at the end of the 6-month period beginning on the date of the enactment of this Act, the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development and the positions of the Director and Deputy Director of such Office are abolished.CommentsClose CommentsPermalink
(b) Disposition of Affairs- During the 6-month period beginning on the date of the enactment of this Act, the Director of the Office of Federal Housing Enterprise Oversight shall, for the purpose of winding up the affairs of the Office of Federal Housing Enterprise Oversight and in addition to carrying out its other responsibilities under law--CommentsClose CommentsPermalink
(1) manage the employees of such Office and provide for the payment of the compensation and benefits of any such employee which accrue before the effective date of the transfer of such employee pursuant to section 303; andCommentsClose CommentsPermalink
(2) may take any other action necessary for the purpose of winding up the affairs of the Office.CommentsClose CommentsPermalink
(c) Status of Employees Before Transfer- The amendments made by title I and the abolishment of the Office of Federal Housing Enterprise Oversight under subsection (a) of this section may not be construed to affect the status of any employee of such Office as employees of an agency of the United States for purposes of any other provision of law before the effective date of the transfer of any such employee pursuant to section 303.CommentsClose CommentsPermalink
(d) Use of Property and Services-CommentsClose CommentsPermalink
(1) PROPERTY- The Director of the Federal Housing Finance Agency may use the property of the Office of Federal Housing Enterprise Oversight to perform functions which have been transferred to the Director of the Federal Housing Finance Agency for such time as is reasonable to facilitate the orderly transfer of functions transferred pursuant to any other provision of this Act or any amendment made by this Act to any other provision of law.CommentsClose CommentsPermalink
(2) AGENCY SERVICES- Any agency, department, or other instrumentality of the United States, and any successor to any such agency, department, or instrumentality, which was providing supporting services to the Office of Federal Housing Enterprise Oversight before the expiration of the period under subsection (a) in connection with functions that are transferred to the Director of the Federal Housing Finance Agency shall--CommentsClose CommentsPermalink
(A) continue to provide such services, on a reimbursable basis, until the transfer of such functions is complete; andCommentsClose CommentsPermalink
(B) consult with any such agency to coordinate and facilitate a prompt and reasonable transition.CommentsClose CommentsPermalink
(e) Savings Provisions-CommentsClose CommentsPermalink
(1) EXISTING RIGHTS, DUTIES, AND OBLIGATIONS NOT AFFECTED- Subsection (a) shall not affect the validity of any right, duty, or obligation of the United States, the Director of the Office of Federal Housing Enterprise Oversight, or any other person, which--CommentsClose CommentsPermalink
(A) arises under or pursuant to the title XIII of the Housing and Community Development Act of 1992, the Federal National Mortgage Association Charter Act, the Federal Home Loan Mortgage Corporation Act, or any other provision of law applicable with respect to such Office; andCommentsClose CommentsPermalink
(B) existed on the day before the abolishment under subsection (a) of this section.CommentsClose CommentsPermalink
(2) CONTINUATION OF SUITS- No action or other proceeding commenced by or against the Director of the Office of Federal Housing Enterprise Oversight in connection with functions that are transferred to the Director of the Federal Housing Finance Agency shall abate by reason of the enactment of this Act, except that the Director of the Federal Housing Finance Agency shall be substituted for the Director of the Office of Federal Housing Enterprise Oversight as a party to any such action or proceeding.CommentsClose CommentsPermalink
SEC. 302. CONTINUATION AND COORDINATION OF CERTAIN REGULATIONS.
All regulations, orders, determinations, and resolutions that--CommentsClose CommentsPermalink
(1) were issued, made, prescribed, or allowed to become effective by--CommentsClose CommentsPermalink
(A) the Office of Federal Housing Enterprise Oversight; orCommentsClose CommentsPermalink
(B) a court of competent jurisdiction and that relate to functions transferred by this subtitle; andCommentsClose CommentsPermalink
(2) are in effect on the date of the abolishment under section 301(a) of this Act, shall remain in effect according to the terms of such regulations, orders, determinations, and resolutions, and shall be enforceable by or against the Director of the Federal Housing Finance Agency until modified, terminated, set aside, or superseded in accordance with applicable law by such Director, as the case may be, any court of competent jurisdiction, or operation of law.CommentsClose CommentsPermalink
SEC. 303. TRANSFER AND RIGHTS OF EMPLOYEES OF OFHEO.
(a) Transfer- Each employee of the Office of Federal Housing Enterprise Oversight shall be transferred to the Federal Housing Finance Agency for employment no later than the date of the abolishment under section 301(a) of this Act and such transfer shall be deemed a transfer of function for purposes of
(b) Guaranteed Positions- Each employee transferred under subsection (a) shall be guaranteed a position with the same status, tenure, grade, and pay as that held on the day immediately preceding the transfer. Each such employee holding a permanent position shall not be involuntarily separated or reduced in grade or compensation for 12 months after the date of transfer, except for cause or, if the employee is a temporary employee, separated in accordance with the terms of the appointment.CommentsClose CommentsPermalink
(c) Appointment Authority for Excepted Service Employees-CommentsClose CommentsPermalink
(1) IN GENERAL- In the case of employees occupying positions in the excepted service, any appointment authority established pursuant to law or regulations of the Office of Personnel Management for filling such positions shall be transferred, subject to paragraph (2).CommentsClose CommentsPermalink
(2) DECLINE OF TRANSFER- The Director of the Federal Housing Finance Agency may decline a transfer of authority under paragraph (1) (and the employees appointed pursuant thereto) to the extent that such authority relates to positions excepted from the competitive service because of their confidential, policy-making, policy-determining, or policy-advocating character.CommentsClose CommentsPermalink
(d) Reorganization- If the Director of the Federal Housing Finance Agency determines, after the end of the 1-year period beginning on the date of the abolishment under section 301(a), that a reorganization of the combined work force is required, that reorganization shall be deemed a major reorganization for purposes of affording affected employees retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code.CommentsClose CommentsPermalink
(e) Employee Benefit Programs- Any employee of the Office of Federal Housing Enterprise Oversight accepting employment with the Director of the Federal Housing Finance Agency as a result of a transfer under subsection (a) may retain for 12 months after the date such transfer occurs membership in any employee benefit program of the Federal Housing Finance Agency or the Office of Federal Housing Enterprise Oversight, as applicable, including insurance, to which such employee belongs on the date of the abolishment under section 301(a) if--CommentsClose CommentsPermalink
(1) the employee does not elect to give up the benefit or membership in the program; andCommentsClose CommentsPermalink
(2) the benefit or program is continued by the Director of the Federal Housing Finance Agency,CommentsClose CommentsPermalink
The difference in the costs between the benefits which would have been provided by such agency and those provided by this section shall be paid by the Director of the Federal Housing Finance Agency. If any employee elects to give up membership in a health insurance program or the health insurance program is not continued by such Director, the employee shall be permitted to select an alternate Federal health insurance program within 30 days of such election or notice, without regard to any other regularly scheduled open season.CommentsClose CommentsPermalink
SEC. 304. TRANSFER OF PROPERTY AND FACILITIES.
Upon the abolishment under section 301(a), all property of the Office of Federal Housing Enterprise Oversight shall transfer to the Director of the Federal Housing Finance Agency.CommentsClose CommentsPermalink
Subtitle B--Federal Housing Finance Board
SEC. 321. ABOLISHMENT OF THE FEDERAL HOUSING FINANCE BOARD.
(a) In General- Effective at the end of the 6-month period beginning on the date of enactment of this Act, the Federal Housing Finance Board (in this title referred to as the `Board') is abolished.CommentsClose CommentsPermalink
(b) Disposition of Affairs- During the 6-month period beginning on the date of enactment of this Act, the Board, for the purpose of winding up the affairs of the Board and in addition to carrying out its other responsibilities under law--CommentsClose CommentsPermalink
(1) shall manage the employees of such Board and provide for the payment of the compensation and benefits of any such employee which accrue before the effective date of the transfer of such employee under section 323; andCommentsClose CommentsPermalink
(2) may take any other action necessary for the purpose of winding up the affairs of the Board.CommentsClose CommentsPermalink
(c) Status of Employees Before Transfer- The amendments made by titles I and II and the abolishment of the Board under subsection (a) may not be construed to affect the status of any employee of such Board as employees of an agency of the United States for purposes of any other provision of law before the effective date of the transfer of any such employee under section 323.CommentsClose CommentsPermalink
(d) Use of Property and Services-CommentsClose CommentsPermalink
(1) PROPERTY- The Director of the Federal Housing Finance Agency may use the property of the Board to perform functions which have been transferred to the Director of the Federal Housing Finance Agency for such time as is reasonable to facilitate the orderly transfer of functions transferred under any other provision of this Act or any amendment made by this Act to any other provision of law.CommentsClose CommentsPermalink
(2) AGENCY SERVICES- Any agency, department, or other instrumentality of the United States, and any successor to any such agency, department, or instrumentality, which was providing supporting services to the Board before the expiration of the period under subsection (a) in connection with functions that are transferred to the Director of the Federal Housing Finance Agency shall--CommentsClose CommentsPermalink
(A) continue to provide such services, on a reimbursable basis, until the transfer of such functions is complete; andCommentsClose CommentsPermalink
(B) consult with any such agency to coordinate and facilitate a prompt and reasonable transition.CommentsClose CommentsPermalink
(e) Savings Provisions-CommentsClose CommentsPermalink
(1) EXISTING RIGHTS, DUTIES, AND OBLIGATIONS NOT AFFECTED- Subsection (a) shall not affect the validity of any right, duty, or obligation of the United States, a member of the Board, or any other person, which--CommentsClose CommentsPermalink
(A) arises under the Federal Home Loan Bank Act or any other provision of law applicable with respect to such Board; andCommentsClose CommentsPermalink
(B) existed on the day before the effective date of the abolishment under subsection (a).CommentsClose CommentsPermalink
(2) CONTINUATION OF SUITS- No action or other proceeding commenced by or against the Board in connection with functions that are transferred to the Director of the Federal Housing Finance Agency shall abate by reason of the enactment of this Act, except that the Director of the Federal Housing Finance Agency shall be substituted for the Board or any member thereof as a party to any such action or proceeding.CommentsClose CommentsPermalink
SEC. 322. CONTINUATION AND COORDINATION OF CERTAIN REGULATIONS.
(a) In General- All regulations, orders, determinations, and resolutions described under subsection (b) shall remain in effect according to the terms of such regulations, orders, determinations, and resolutions, and shall be enforceable by or against the Director of the Federal Housing Finance Agency until modified, terminated, set aside, or superseded in accordance with applicable law by such Director, any court of competent jurisdiction, or operation of law.CommentsClose CommentsPermalink
(b) Applicability- A regulation, order, determination, or resolution is described under this subsection if it--CommentsClose CommentsPermalink
(1) was issued, made, prescribed, or allowed to become effective by--CommentsClose CommentsPermalink
(A) the Board; orCommentsClose CommentsPermalink
(B) a court of competent jurisdiction and relates to functions transferred by this subtitle; andCommentsClose CommentsPermalink
(2) is in effect on the effective date of the abolishment under section 321(a).CommentsClose CommentsPermalink
SEC. 323. TRANSFER AND RIGHTS OF EMPLOYEES OF THE FEDERAL HOUSING FINANCE BOARD.
(a) Transfer- Each employee of the Board shall be transferred to the Federal Housing Finance Agency for employment not later than the effective date of the abolishment under section 321(a), and such transfer shall be deemed a transfer of function for purposes of
(b) Guaranteed Positions- Each employee transferred under subsection (a) shall be guaranteed a position with the same status, tenure, grade, and pay as that held on the day immediately preceding the transfer. Each such employee holding a permanent position shall not be involuntarily separated or reduced in grade or compensation for 12 months after the date of transfer, except for cause or, if the employee is a temporary employee, separated in accordance with the terms of the appointment.CommentsClose CommentsPermalink
(c) Appointment Authority for Excepted and Senior Executive Service Employees-CommentsClose CommentsPermalink
(1) IN GENERAL- In the case of employees occupying positions in the excepted service or the Senior Executive Service, any appointment authority established under law or by regulations of the Office of Personnel Management for filling such positions shall be transferred, subject to paragraph (2).CommentsClose CommentsPermalink
(2) DECLINE OF TRANSFER- The Director of the Federal Housing Finance Agency may decline a transfer of authority under paragraph (1) to the extent that such authority relates to positions excepted from the competitive service because of their confidential, policymaking, policy-determining, or policy-advocating character, and noncareer positions in the Senior Executive Service (within the meaning of
(d) Reorganization- If the Director of the Federal Housing Finance Agency determines, after the end of the 1-year period beginning on the effective date of the abolishment under section 321(a), that a reorganization of the combined workforce is required, that reorganization shall be deemed a major reorganization for purposes of affording affected employees retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code.CommentsClose CommentsPermalink
(e) Employee Benefit Programs-CommentsClose CommentsPermalink
(1) IN GENERAL- Any employee of the Board accepting employment with the Federal Housing Finance Agency as a result of a transfer under subsection (a) may retain for 12 months after the date on which such transfer occurs membership in any employee benefit program of the Federal Housing Finance Agency or the Board, as applicable, including insurance, to which such employee belongs on the effective date of the abolishment under section 321(a) if--CommentsClose CommentsPermalink
(A) the employee does not elect to give up the benefit or membership in the program; andCommentsClose CommentsPermalink
(B) the benefit or program is continued by the Director of the Federal Housing Finance Agency.CommentsClose CommentsPermalink
(2) COST DIFFERENTIAL- The difference in the costs between the benefits which would have been provided by the Board and those provided by this section shall be paid by the Director of the Federal Housing Finance Agency. If any employee elects to give up membership in a health insurance program or the health insurance program is not continued by such Director, the employee shall be permitted to select an alternate Federal health insurance program within 30 days after such election or notice, without regard to any other regularly scheduled open season.CommentsClose CommentsPermalink
SEC. 324. TRANSFER OF PROPERTY AND FACILITIES.
Upon the effective date of the abolishment under section 321(a), all property of the Board shall transfer to the Director of the Federal Housing Finance Agency.CommentsClose CommentsPermalink
Subtitle C--Department of Housing and Urban Development
SEC. 341. TERMINATION OF ENTERPRISE-RELATED FUNCTIONS.
(a) Termination Date- For purposes of this subtitle, the term `termination date' means the date that occurs 6 months after the date of the enactment of this Act.CommentsClose CommentsPermalink
(b) Determination of Transferred Functions and Employees-CommentsClose CommentsPermalink
(1) IN GENERAL- Not later than the expiration of the 3-month period beginning on the date of the enactment of this Act, the Secretary, in consultation with the Director of the Office of Federal Housing Enterprise Oversight, shall determine--CommentsClose CommentsPermalink
(A) the functions, duties, and activities of the Secretary of Housing and Urban Development regarding oversight or regulation of the enterprises under or pursuant to the authorizing statutes, title XIII of the Housing and Community Development Act of 1992, and any other provisions of law, as in effect before the date of the enactment of this Act, but not including any such functions, duties, and activities of the Director of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development and such Office; andCommentsClose CommentsPermalink
(B) the employees of the Department of Housing and Urban Development necessary to perform such functions, duties, and activities.CommentsClose CommentsPermalink
(2) ENTERPRISE-RELATED FUNCTIONS- For purposes of this subtitle, the term `enterprise-related functions of the Department' means the functions, duties, and activities of the Department of Housing and Urban Development determined under paragraph (1)(A).CommentsClose CommentsPermalink
(3) ENTERPRISE-RELATED EMPLOYEES- For purposes of this subtitle, the term `enterprise-related employees of the Department' means the employees of the Department of Housing and Urban Development determined under paragraph (1)(B).CommentsClose CommentsPermalink
(c) Disposition of Affairs- During the 6-month period beginning on the date of enactment of this Act, the Secretary of Housing and Urban Development (in this title referred to as the `Secretary'), for the purpose of winding up the affairs of the Secretary regarding the enterprise-related functions of the Department of Housing and Urban Development (in this title referred to as the `Department') and in addition to carrying out the Secretary's other responsibilities under law regarding such functions--CommentsClose CommentsPermalink
(1) shall manage the enterprise-related employees of the Department and provide for the payment of the compensation and benefits of any such employee which accrue before the effective date of the transfer of any such employee under section 343; andCommentsClose CommentsPermalink
(2) may take any other action necessary for the purpose of winding up the enterprise-related functions of the Department.CommentsClose CommentsPermalink
(d) Status of Employees Before Transfer- The amendments made by titles I and II and the termination of the enterprise-related functions of the Department under subsection (b) may not be construed to affect the status of any employee of the Department as employees of an agency of the United States for purposes of any other provision of law before the effective date of the transfer of any such employee under section 343.CommentsClose CommentsPermalink
(e) Use of Property and Services-CommentsClose CommentsPermalink
(1) PROPERTY- The Director of the Federal Housing Finance Agency may use the property of the Secretary to perform functions which have been transferred to the Director of the Federal Housing Finance Agency for such time as is reasonable to facilitate the orderly transfer of functions transferred under any other provision of this Act or any amendment made by this Act to any other provision of law.CommentsClose CommentsPermalink
(2) AGENCY SERVICES- Any agency, department, or other instrumentality of the United States, and any successor to any such agency, department, or instrumentality, which was providing supporting services to the Secretary regarding enterprise-related functions of the Department before the termination date under subsection (a) in connection with such functions that are transferred to the Director of the Federal Housing Finance Agency shall--CommentsClose CommentsPermalink
(A) continue to provide such services, on a reimbursable basis, until the transfer of such functions is complete; andCommentsClose CommentsPermalink
(B) consult with any such agency to coordinate and facilitate a prompt and reasonable transition.CommentsClose CommentsPermalink
(f) Savings Provisions-CommentsClose CommentsPermalink
(1) EXISTING RIGHTS, DUTIES, AND OBLIGATIONS NOT AFFECTED- Subsection (a) shall not affect the validity of any right, duty, or obligation of the United States, the Secretary, or any other person, which--CommentsClose CommentsPermalink
(A) arises under the authorizing statutes, title XIII of the Housing and Community Development Act of 1992, or any other provision of law applicable with respect to the Secretary, in connection with the enterprise-related functions of the Department; andCommentsClose CommentsPermalink
(B) existed on the day before the termination date under subsection (a).CommentsClose CommentsPermalink
(2) CONTINUATION OF SUITS- No action or other proceeding commenced by or against the Secretary in connection with the enterprise-related functions of the Department shall abate by reason of the enactment of this Act, except that the Director of the Federal Housing Finance Agency shall be substituted for the Secretary or any member thereof as a party to any such action or proceeding.CommentsClose CommentsPermalink
SEC. 342. CONTINUATION AND COORDINATION OF CERTAIN REGULATIONS.
(a) In General- All regulations, orders, and determinations described in subsection (b) shall remain in effect according to the terms of such regulations, orders, determinations, and resolutions, and shall be enforceable by or against the Director of the Federal Housing Finance Agency until modified, terminated, set aside, or superseded in accordance with applicable law by such Director, any court of competent jurisdiction, or operation of law.CommentsClose CommentsPermalink
(b) Applicability- A regulation, order, or determination is described under this subsection if it--CommentsClose CommentsPermalink
(1) was issued, made, prescribed, or allowed to become effective by--CommentsClose CommentsPermalink
(A) the Secretary; orCommentsClose CommentsPermalink
(B) a court of competent jurisdiction and that relate to the enterprise-related functions of the Department; andCommentsClose CommentsPermalink
(2) is in effect on the termination date under section 341(a).CommentsClose CommentsPermalink
SEC. 343. TRANSFER AND RIGHTS OF EMPLOYEES OF DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT.
(a) Transfer-CommentsClose CommentsPermalink
(1) IN GENERAL- Except as provided in paragraph (2), each enterprise-related employee of the Department shall be transferred to the Federal Housing Finance Agency for employment not later than the termination date under section 341(a) and such transfer shall be deemed a transfer of function for purposes of
(2) AUTHORITY TO DECLINE- An enterprise-related employee of the Department may, in the discretion of the employee, decline transfer under paragraph (1) to a position in the Federal Housing Finance Agency and shall be guaranteed a position in the Department with the same status, tenure, grade, and pay as that held on the day immediately preceding the date that such declination was made. Each such employee holding a permanent position shall not be involuntarily separated or reduced in grade or compensation for 12 months after the date that the transfer would otherwise have occurred, except for cause or, if the employee is a temporary employee, separated in accordance with the terms of the appointment.CommentsClose CommentsPermalink
(b) Guaranteed Positions- Each enterprise-related employee of the Department transferred under subsection (a) shall be guaranteed a position with the same status, tenure, grade, and pay as that held on the day immediately preceding the transfer. Each such employee holding a permanent position shall not be involuntarily separated or reduced in grade or compensation for 12 months after the date of transfer, except for cause or, if the employee is a temporary employee, separated in accordance with the terms of the appointment.CommentsClose CommentsPermalink
(c) Appointment Authority for Excepted and Senior Executive Service Employees-CommentsClose CommentsPermalink
(1) IN GENERAL- In the case of employees occupying positions in the excepted service or the Senior Executive Service, any appointment authority established under law or by regulations of the Office of Personnel Management for filling such positions shall be transferred, subject to paragraph (2).CommentsClose CommentsPermalink
(2) DECLINE OF TRANSFER- The Director of the Federal Housing Finance Agency may decline a transfer of authority under paragraph (1) (and the employees appointed pursuant thereto) to the extent that such authority relates to positions excepted from the competitive service because of their confidential, policymaking, policy-determining, or policy-advocating character, and noncareer positions in the Senior Executive Service (within the meaning of
(d) Reorganization- If the Director of the Federal Housing Finance Agency determines, after the end of the 1-year period beginning on the termination date under section 341(a), that a reorganization of the combined workforce is required, that reorganization shall be deemed a major reorganization for purposes of affording affected employees retirement under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code.CommentsClose CommentsPermalink
(e) Employee Benefit Programs-CommentsClose CommentsPermalink
(1) IN GENERAL- Any enterprise-related employee of the Department accepting employment with the Federal Housing Finance Agency as a result of a transfer under subsection (a) may retain for 12 months after the date on which such transfer occurs membership in any employee benefit program of the Federal Housing Finance Agency or the Department, as applicable, including insurance, to which such employee belongs on the termination date under section 341(a) if--CommentsClose CommentsPermalink
(A) the employee does not elect to give up the benefit or membership in the program; andCommentsClose CommentsPermalink
(B) the benefit or program is continued by the Director of the Federal Housing Finance Agency.CommentsClose CommentsPermalink
(2) COST DIFFERENTIAL- The difference in the costs between the benefits which would have been provided by the Department and those provided by this section shall be paid by the Director of the Federal Housing Finance Agency. If any employee elects to give up membership in a health insurance program or the health insurance program is not continued by such Director, the employee shall be permitted to select an alternate Federal health insurance program within 30 days after such election or notice, without regard to any other regularly scheduled open season.CommentsClose CommentsPermalink
SEC. 344. TRANSFER OF APPROPRIATIONS, PROPERTY, AND FACILITIES.
Upon the termination date under section 341(a), all assets, liabilities, contracts, property, records, and unexpended balances of appropriations, authorizations, allocations, and other funds employed, held, used, arising from, available to, or to be made available to the Department in connection with enterprise-related functions of the Department shall transfer to the Director of the Federal Housing Finance Agency. Unexpended funds transferred by this section shall be used only for the purposes for which the funds were originally authorized and appropriated.CommentsClose CommentsPermalink
Passed the House of Representatives May 22, 2007.CommentsClose CommentsPermalink
Attest:CommentsClose CommentsPermalink
Clerk.
Clerk.CommentsClose CommentsPermalink
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