115TH CONGRESS

2nd SESSION

 

 

115TH CONGRESS

2nd SESSION

H. R.

To require the sale of distressed notes and other obligations, and for other purposes.


IN THE HOUSE OF REPRESENTATIVES

Mr. KELLY of Pennsylvania introduced the following bill; which was referred to the Committee on ____________


A BILL

To require the sale of distressed notes and other obligations, and for other purposes.

1 Be it enacted by the Senate and House of Representa-

2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Generating American

5 Income and Infrastructure Now Act’’’.

6 SEC. 2. REQUIRED SALE OF DISTRESSED NOTES AND

7 OTHER OBLIGATIONS.

8 (a) IN GENERAL.—

 

 
 

                                                          2

1                (1) COORDINATION OF SALE OF DISTRESSED

2      NOTES.—The Secretary of Agriculture shall sell,

3      under terms established by the Secretary of the

4      Treasury, distressed notes and other obligations held

5      by the Department of Agriculture.

6                (2) DEPOSIT OF PROCEEDS.—Of the proceeds

7      from the sale of the notes and obligations pursuant

8      to paragraph (1)— 

9                     (A) 50 percent shall be deposited in an ac- 

10             count specifically designated for purposes of

11              carrying out infrastructure projects in low-in-

12              come communities (as defined in section 45D(e)

13              of the Internal Revenue Code of 1986); and

14                   (B) 50 percent shall be retained in the

15              Treasury for purposes of deficit reduction.

16      (b) TERMS AND PROCEDURES OF SALES.—

17              (1) FAIR MARKET VALUATION.—The Secretary

18      of the Treasury shall consult with the Secretary of

19      Agriculture to establish a fair market valuation for

20      the sale of the distressed notes or other obligations

21      pursuant to this section.

22               (2) NO RECOURSE OR LIABILITY.—The sale of

23      distressed notes or other obligations pursuant to this

24      section shall be on a nonrecourse basis. The Sec-

25      retary of Agriculture and any subsequent purchaser

 

                                                           3

1      of such notes or other obligations sold on a non-

2      recourse basis shall be relieved of any responsibilities

3      that might have been imposed had the borrower re-

4      mained indebted to the Secretary of Agriculture.

5                (3) CONTRACT PROVISIONS.—The sale of dis-

6      tressed notes or other obligations pursuant to this

7      section shall not alter the terms specified in the note

8      or other obligation.

9                (4) NOTIFICATION; NOTICE AND COMMENT.—

10      Not less than 60 days before the sale of a distressed

11      note or other obligation pursuant to this section, the

12      Secretary of Agriculture shall notify the borrower

13      that the Department of Agriculture intends to sell

14      such note or other obligation.

15                (5) NOTICE AND COMMENT.—During the 60-

16      day period before the sale of a distressed note or

17      other obligation under this section, the Secretary of

18      Agriculture shall provide an opportunity for notice

19      and public comment in a manner that protects the

20      personally identifiable information relating to the

21      borrower.

22                (6) BORROWER OPPORTUNITY TO REFI

23      NANCE.—A borrower may pay off a distressed note

24      or other obligation at a discount to par value ena-

25      bling the borrower to refinance the note or other ob-

 

                                                          4

1      ligation through a private market loan within 30

2      days after the borrower receives notification of the

3      intent to sell such note or other obligation pursuant 4 to paragraph (4).

5                (7) BEST PRICE.—The Secretary of Agriculture

6      shall obtain the highest possible return from the

7      sales of distressed notes or other obligations under

8      this section and may conduct sales on a competitive

9      bidding or negotiated process, in amounts suffi-

10      ciently large to assure market interest.

11                (8) FINANCIAL ADVISOR.—In order to assure

12      the highest possible return, the Secretary of Agri-

13      culture may employ public finance advisors from

14     micro-, woman-, and minority-owned businesses, as

15      defined by the Small Business Administration.

16               (9) LOAN SERVICING.—Before selling any dis-

17      tressed note or other obligation under this section,

18      the Secretary of Agriculture shall require persons of-

19      fering to purchase the note or other obligation to

20      demonstrate—

 21                   (A) an ability or resources to provide such

22                servicing, with respect to the distressed note or

23               other obligation, that the Secretary of the

24               Treasury determines to be necessary to ensure

25               the continued performance on the loan; and

 

                                                         5

1                      (B) the ability to generate capital to pro-

2               vide the borrowers of the distressed notes or

3               other obligations such additional credit as may

4               be necessary in proper servicing of such notes

5               or other obligations.

6           (c) GAO REPORT.—Not later than one year after the

7      date of the enactment of this Act, the Comptroller General

8      of the United States shall submit to Congress a report

9      on the sale of distressed notes or other obligations of the

10    Department of Agriculture under this section. Such report

11     shall include the recommendation of the Comptroller Gen-

12    eral of the United States with respect to whether such a

13     ale should be undertaken by other Federal agencies.