[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 160 Introduced in House (IH)]
106th CONGRESS
1st Session
H. R. 160
To amend title II of the Social Security Act to ensure the integrity of
the Social Security trust funds by providing for investment of such
trust funds in marketable interest-bearing obligations of the United
States, and to protect such trust funds from the public debt limit.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 6, 1999
Mr. Royce (for himself, Mr. Campbell, Mr. Hutchinson, Mrs. Bono, Mr.
Miller of Florida, Mr. Norwood, Mr. LaTourette, Mr. Regula, and Mr.
McIntosh) introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend title II of the Social Security Act to ensure the integrity of
the Social Security trust funds by providing for investment of such
trust funds in marketable interest-bearing obligations of the United
States, and to protect such trust funds from the public debt limit.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Social Security Strengthening and
Protection Act of 1999''.
SEC. 2. INVESTMENT OF THE FEDERAL OLD-AGE AND SURVIVORS INSURANCE TRUST
FUND AND THE FEDERAL DISABILITY INSURANCE TRUST FUND.
(a) In General.--Section 201(d) of the Social Security Act (42
U.S.C. 401(d)) is amended--
(1) by inserting ``(1)'' after ``(d)'';
(2) by striking ``Such investments may be made only'' and
inserting the following: ``Except as provided in paragraphs (2)
and (3), such investments may be made only'';
(3) by striking the last sentence; and
(4) by adding at the end the following new paragraphs:
``(2)(A) As of the end of each fiscal year, the Managing Trustee
shall determine--
``(i) the surplus (if any) in the total budget of the
Government of the United States, and
``(ii) the total amount of the Trust Funds then invested in
obligations issued pursuant to paragraph (1).
``(B) During the following fiscal year, the Managing Trustee shall
purchase qualified investments, with amounts otherwise available in the
general fund of the Treasury, at original issue or on the market, at a
total cost equal to at least 90 percent of the surplus referred to in
subparagraph (A)(i), except that such total cost may not exceed the
total amount referred to in subparagraph (A)(ii).
``(C) Upon the purchase of qualified investments pursuant to
subparagraph (B), the Managing Trustee shall redeem, with such
qualified investments, obligations which have been issued pursuant to
paragraph (1) and are held by either of the Trust Funds. Such qualified
investments shall be held by the Trust Fund until liquidation of such
qualified investments is necessary to meet current withdrawals or is
otherwise determined by the Managing Trustee to be in the public
interest.
``(D) Effective for fiscal years beginning after such time as all
obligations issued pursuant to paragraph (1) and held by the Trust
Funds have been redeemed with qualified investments pursuant to
subparagraph (C), the Managing Trustee shall invest only in qualified
investments such portion of each Trust Fund as is not, in his judgment,
required to meet current withdrawals.
``(E) The Managing Trustee shall exercise his authority under this
paragraph solely for the benefit of the beneficiaries under the old-
age, survivors, and disability insurance program under this title.
``(3) For purposes of paragraph (2)--
``(A)(i) The term `qualified investment' means a marketable
interest-bearing obligation of the United States, purchased on
original issue or at the market price, which meets the
requirements of clause (ii).
``(ii) An obligation referred to in clause (i) meets the
requirements of this section if such obligation--
``(I) has a maturity fixed with due regard for the
needs of the Trust Funds,
``(II) bears interest at a rate at least equal to
the average market yield (computed by the Managing
Trustee on the basis of market quotations as of the end
of the calendar month next preceding the date of
purchase) on all marketable interest-bearing
obligations of the United States then forming a part of
the public debt which are not due or callable until
after the expiration of four years from the end of such
calendar month, and
``(III) is subject to an option to redeem such
obligations at any time at the purchase price.
``(B) The term `total budget of the United States
Government' means all spending and receipt accounts of the
United States Government that are designated as on-budget or
off-budget accounts.
``(4) The preceding provisions of this subsection shall be subject
to such reforms of the old-age, survivors, and disability insurance
program under this title as may be provided in legislation enacted
after the date of the enactment of the Social Security Strengthening
and Protection Act of 1999.''.
(b) Effective Date.--The amendments made by this section shall
apply with respect to fiscal years beginning on or after October 1,
2000.
SEC. 3. PROTECTION OF THE SOCIAL SECURITY TRUST FUNDS FROM THE PUBLIC
DEBT LIMIT.
(a) Protection of Trust Funds.--Notwithstanding any other provision
of law--
(1) no officer or employee of the United States may--
(A) delay the deposit of any amount into (or delay
the credit of any amount to) the Federal Old-Age and
Survivors Insurance Trust Fund or the Federal
Disability Insurance Trust Fund or otherwise vary from
the normal terms, procedures, or timing for making such
deposits or credits, or
(B) refrain from the investment in public debt
obligations of amounts in either of such Trust Funds,
if a purpose of such action or inaction is to not increase the
amount of outstanding public debt obligations, and
(2) no officer or employee of the United States may
disinvest amounts in either of such Trust Funds which are
invested in public debt obligations if a purpose of the
disinvestment is to reduce the amount of outstanding public
debt obligations.
(b) Protection of Benefits and Expenditures for Administrative
Expenses.--
(1) In general.--Notwithstanding subsection (a), during any
period for which cash benefits or administrative expenses would
not otherwise be payable from the Federal Old-Age and Survivors
Insurance Trust Fund or the Federal Disability Insurance Trust
Fund by reason of an inability to issue further public debt
obligations because of the applicable public debt limit, public
debt obligations held by such Trust Fund shall be sold or
redeemed only for the purpose of making payment of such
benefits or administrative expenses and only to the extent cash
assets of such Trust Fund are not available from month to month
for making payment of such benefits or administrative expenses.
(2) Issuance of corresponding debt.--For purposes of
undertaking the sale or redemption of public debt obligations
held by the Federal Old-Age and Survivors Insurance Trust Fund
or the Federal Disability Insurance Trust Fund pursuant to
paragraph (1), the Secretary of the Treasury may issue
corresponding public debt obligations to the public, in order
to obtain the cash necessary for payment of benefits or
administrative expenses from such Trust Fund, notwithstanding
the public debt limit.
(3) Advance notice of sale or redemption.--Not less than 3
days prior to the date on which, by reason of the public debt
limit, the Secretary of the Treasury expects to undertake a
sale or redemption authorized under paragraph (1), the
Secretary of the Treasury shall report to each House of the
Congress and to the Comptroller General of the United States
regarding the expected sale or redemption. Upon receipt of such
report, the Comptroller General shall review the extent of
compliance with subsection (a) and paragraphs (1) and (2) of
this subsection and shall issue such findings and
recommendations to each House of the Congress as the
Comptroller General considers necessary and appropriate.
(c) Public Debt Obligation.--For purposes of this section, the term
``public debt obligation'' means any obligation subject to the public
debt limit established under section 3101 of title 31, United States
Code.
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