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.....................................................................
(Original Signature of Member)

H. R. ll

114TH CONGRESS
1ST SESSION

To amend the Federal Housing Enterprises Financial Safety and Soundness

Act of 1992 to establish a secondary reserve fund for a housing enterprise under conservatorship to protect taxpayers against loss in the
event of a housing downturn, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

Mrs. BLACKBURN introduced the following bill; which was referred to the
Committee on llllllllllllll

A BILL
To amend the Federal Housing Enterprises Financial Safety
and Soundness Act of 1992 to establish a secondary
reserve fund for a housing enterprise under conservatorship to protect taxpayers against loss in the event of
a housing downturn, 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.

This Act may be cited as the Enterprise Secondary

5 Reserve Taxpayer Protection and Government Account6 ability Act of 2015.

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1

SEC. 2. SECONDARY RESERVE.

Section 1362 of the Federal Housing Enterprises Fi-

3 nancial Safety and Soundness Act of 1992 (12 U.S.C.

4 4612) is amended
5

(1) by striking the section designation and

6
7

heading and inserting the following:

SEC. 1362. MINIMUM CAPITAL LEVELS AND SECONDARY

RESERVE.;

9
10

(2) by redesignating subsections (e) and (f) as

subsections (f) and (g), respectively; and

11

(3) by inserting after subsection (d) the fol-

12

lowing new subsection:

13

(e) SECONDARY RESERVE.

14

(1) ESTABLISHMENT.Notwithstanding any

15

other provision of law, rule, regulation, order, or

16

agreement, the Director shall, by regulation, estab-

17

lish for any enterprise operating in conservatorship

18

pursuant to section 1367 a secondary reserve fund

19

and shall deposit in such fund from any revenues of

20

the enterprise an amount equal to the amounts enu-

21

merated under subsection (a) for the enterprise.

22

(2) MAINTENANCE.Amounts in the sec-

23

ondary reserve fund shall be held in escrow by the

24

enterprise until

25

(A) the Director uses such amounts pur-

26

suant to paragraph (3); or

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1

(B) the Director abolishes the secondary

reserve fund pursuant to paragraph (4).

(3) AVAILABILITY

the Di-

rector determines, in accordance with regulations

issued under paragraph (5), that losses of an enter-

prise operating in conservatorship pursuant to sec-

tion 1367 will exceed amounts available for the en-

terprise under subsections (a), (c), (d), or (f), the

Director shall make a determination, in accordance

10

with such regulation, whether to use funds held in

11

the secondary reserve for the enterprise.

12

(4) ABOLISHMENT.Upon the dissolution of

13

the conservatorship of an enterprise, the Director

14

shall abolish any secondary reserve established under

15

paragraph (1) for the enterprise and amounts re-

16

maining in such reserve upon such abolishment shall

17

revert to meet capital requirements under sub-

18

sections (a), (c), (d), and (f) and then to earnings

19

of the enterprise.

20
21

(5) REGULATIONS.The Director shall issue

regulations establishing

22

(A) standards and procedures for the es-

23

tablishment of a secondary reserve under para-

24

graph (1);

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OF AMOUNTS.If

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1

(B) standards and procedures that the

Director will use to make the determinations

under paragraph (3); and

(C) procedures for abolishment of a sec-

ondary reserve under paragraph (4).

(6) TREATMENT

OF SECONDARY RESERVE.

Any secondary reserve established under this Act for

an enterprise shall not be considered capital, a cap-

ital reserve, or otherwise an asset of the enterprise,

10

other than as part of a capital restoration plan for

11

the enterprise approved under section 1369C, during

12

the pendency of a conservatorship for the enter-

13

prise..

14

SEC. 3. EFFECTIVE DATE.

15

The amendments made by section 2 of this Act shall

16 take effect upon the expiration of the 90-day period begin17 ning on the date of the enactment of this Act and the
18 Director of the Federal Housing Finance Agency shall
19 issue the regulations required under section 1362(e)(5) of
20 the Federal Housing Enterprises Financial Safety and
21 Soundness Act of 1992, added by the amendment made
22 by such section 2, before the expiration of such period.

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