Short title

This Act may be cited as the

United States Territories Infrastructure Bond Bank Authorization Act

Definitions

In this Act: (1)

Bank

The term Bank means the United States Territories Infrastructure Bond Bank. (2)

Board

The term Board means the Board of Directors of the United States Territories Infrastructure Bond Bank. (3)

Debt instruments

The term debt instruments means bonds or notes issued by the Bank under authority granted in this Act. (4)

Infrastructure

The term infrastructure means those facilities that are essential for public health, welfare, and safety, such as sewage treatment facilities, municipal water supply and treatment facilities, solid waste facilities, public safety equipment and facilities, roads, traffic control devices and other transportation facilities, sidewalks, buried utility lines and other streetscape improvements, parks and other open space or recreational areas. (5)

Territorial customer

The term territorial customer means any of the governments of the United States territories of American Samoa, Guam, the United States Virgin Islands, or the Commonwealth of the Northern Mariana Islands, or such other territory as shall become eligible in accordance with the provisions of section 14. (6)

Territory

The term territory means a territory of the United States. (7)

Secretary

The term Secretary means the Secretary of the Interior.

Establishment

(a)

In general

The Secretary shall establish, in accordance with this Act, a body corporate and politic, with corporate succession, to be known as the “United States Territories Infrastructure Bond Bank”. The Bank shall not be an agency or instrumentality of the Federal Government, and an officer, employee, or member of the board of the Bank shall not be deemed to be an officer or employee of or agent for the Federal Government by reason of such service. (b)

Purpose

The purpose of the Bank shall be to provide low-cost financing for any territorial customer to construct infrastructure or refinance debt that was acquired to construct infrastructure. (c)

Essential governmental function

The Bank shall be an entity exercising public and essential governmental functions, and the exercise by the Bank of the powers conferred by this Act is deemed to be an essential governmental function of the territories. (d)

Incorporation of Bank

The Secretary shall— (1)incorporate the Bank in a jurisdiction of the United States, under the laws of that jurisdiction, after consultation with the governors of the territories; and (2)organize the initial meeting of the Board of Directors.

Board of directors

(a)

In general

Except as provided in section 14, the Bank shall be governed by a Board of Directors consisting of 5 members as follows: one appointed by the Secretary, and one each appointed by the governors of American Samoa, Guam, the United States Virgin Islands, and the Commonwealth of the Northern Mariana Islands. (b)

Residency

A director from a territory shall be a resident of the territory from which the director was appointed. (c)

Term of office; vacancy; removal

Directors shall serve for a term of 4 years, except that the terms of the members of the initial board shall terminate in a uniformly staggered fashion over the first 4 years of the Bank’s existence as determined by the Secretary. A director may be reappointed. Any vacancy occurring other than by the expiration of a term shall be filled by appointment for the unexpired term. The Secretary may remove a director from office for cause after a public hearing. The Secretary may suspend a director pending the completion of this hearing. (d)

Election of chairman

The Board shall elect a chairman by a simple majority from among the Board’s members. (e)

Oath of office

Each director shall— (1)take and subscribe an oath, upon entering office, to perform the duties of his office faithfully, impartially and justly to the best of his ability, with a record of the oath to be filed with the records of the Bank; (2)submit a report of the director’s personal investment holdings and if the Secretary determines that such holdings conflict with the purposes of this Act, the director must divest himself of such holdings, or vacate the position; and (3)execute a surety bond as required in section 12. (f)

Compensation

All directors shall be reimbursed for reasonable expenses incurred in carrying out their duties under this Act.

Professional staff

(a)

Appointment of President by board

The Board shall appoint a President who shall serve at the pleasure of the Board, and, subject to the authority of the Board, shall exercise general supervision, direction, and control of the affairs of the Bank. The Board of Directors shall determine the duties and compensation of the President. (b)

Employees

The President may employ a general counsel, architects, engineers, accountants, attorneys, financial advisors or experts and any other agents or employees who are required and determine their qualifications, terms of office, duties and compensation.

Bank authority and prohibitions

(a)

Authority To issue general obligations, bonds, or notes

The Bank may issue general obligations, bonds, or notes in such principal amounts as the Board deems necessary to provide funds for any purpose authorized in this Act, including— (1)making loans; (2)paying, funding, or refunding of the principal of, or interest or redemption premiums on, any bonds or notes issued by it whether the bonds or notes or interest to be funded or refunded have or have not become due; (3)establishing or increasing of reserves to secure or to pay bonds or notes or interest thereon, and (4)paying all other costs or expenses of the Bank, during the initial 2 years of operation, that are incident to carrying out the Bank’s purposes and powers. (b)

General powers

The Bank may exercise the general powers of a bond bank, such as the power to— (1)sue and be sued; (2)adopt an official seal and alter the seal at pleasure; (3)adopt bylaws and make and enforce rules for the conduct of its business and for use of its services and facilities; (4)maintain an office at any place within the United States; (5)acquire, hold, use and dispose of its income, revenues, funds and moneys; (6)acquire, rent, lease, hold, use and dispose of other personal property for its purposes; (7)borrow money and issue its negotiable general obligation debt instruments payable from revenues or funds of the Bank, subject only to agreements with the holders of particular bonds or notes pledging particular revenues or funds, and to provide for and secure the payment thereof and to provide for the rights of the holders thereof, and to purchase, hold and dispose of any of its debt instruments; Except as otherwise provided herein or by the Bank, every issue of bonds or notes shall be general obligations; (8)obtain additional security for bonds or notes by a pledge of any grant or contributions from the United States, a State or territory, or any other governmental unit, or any person, firm or corporation, or a pledge of any income or revenues, funds or moneys of the Bank from any source whatsoever; (9)fix and revise from time to time and charge and collect fees and charges for the use of its services or facilities; (10)accept gifts or grants of property, funds, money, materials, labor, supplies or services from the United States of America or from any governmental unit or any person, firm or corporation, and carry out the terms or provisions or make agreements with respect to any gifts or grants, and to do any and all things necessary and appropriate in connection with procuring, acceptance or disposition of gifts or grants; (11)do anything authorized by this Act, through its officers, agents or employees or by contracts with any person, firm or corporation; (12)enter into and enforce all contracts necessary and appropriate for the purposes of the Bank or pertaining to any loan to a governmental unit or any purchase or sale of municipal bonds or revenue bonds or other investments or to the performance of its duties and execution or carrying out of any of its powers under this Act; (13)purchase or hold municipal bonds and revenue bonds at such prices and in such manner as the Bank deems advisable, and sell municipal bonds and revenue bonds acquired or held by it at such prices without relation to cost and in such manner as the Bank deems advisable; (14)invest any funds or moneys of the Bank not immediately required for loan to governmental units and for the purchase of municipal bonds or revenue bonds, in the same manner as permitted for investment of funds belonging to the territories or held in the treasury, except as otherwise provided by this Act; (15)prescribe any form of application or procedure required of a governmental unit for the loan or purchase of its municipal bonds or revenue bonds, fix the terms and conditions of that loan or purchase, and enter into agreements with governmental units with respect to any loan or purchase; (16)consider the need, desirability or eligibility of the loan to a territorial customer, the ability of the territorial customer to secure borrowed money from other sources and the costs thereof, and the particular public improvement or purpose to be financed by the municipal bonds or revenue bonds to be purchased by the Bank; (17)charge for its costs and services in review or consideration of any proposed loan to a territorial customer or purchase of municipal bonds or revenue bonds of a territorial customer, including a charge for such costs or services, whether or not the loan is made or the municipal bonds or revenue bonds are purchased; (18)establish any terms and provisions with respect to any purchase of municipal bonds or revenue bonds by the Bank, including date and maturities of the bonds, provisions as to redemption or payment prior to maturity, and any other matters which are necessary or advisable in the judgment of the Bank; (19)conduct examinations and hearings and to hear testimony and take proof, under oath or affirmation, at public or private hearings, on any matter material for its information and necessary to carry out this Act; (20)issue subpoenas requiring the attendance of witnesses and the production of books and papers pertinent to any hearing before the Bank, or before one or more of the directors of the Bank appointed by it to conduct the hearing; (21)apply to any court, having territorial jurisdiction of the offense, to have punished for contempt any witness who refuses to obey a subpoena, or who refuses to be sworn or affirmed to testify, or who is guilty of any contempt after summons to appear; (22)procure insurance against any losses in connection with its property, operations or assets in such amounts and from such insurers as it deems desirable; (23)consent, to the extent permitted under its contracts with the holders of bonds or notes of the Bank, to any modification of the rate of interest, time and payment of any installment of principal or interest, security or any other term of bond or note, contract or agreement of any kind to which the Bank is a party; and (24)issue Bank bonds or notes which are secured by neither the reserve fund nor the revenue bond reserve fund, but which may be secured by such other funds and accounts as may be authorized by the Bank from time-to-time. (c)

Prohibitions

The Bank may not— (1)make loans of money to any person, firm or corporation other than a government or a governmental agency or subdivision, or purchase securities issued by any person, firm or corporation other than a governmental unit or for investment except as provided in this Act; (2)issue bills of credit, or accept deposits of money for time or demand deposit, or administer trust, or engage in any form or manner in, or in the conduct of, any private or commercial banking business, or act as a savings bank or savings and loan association; (3) be or constitute a bank or trust company within the jurisdiction or under the control of the comptroller of the currency of the United States of America or the department of the treasury thereof; or (4)be or constitute a bank, banker or dealer in securities within the meaning of or subject to the provisions of any securities, securities exchange, or securities dealers law, of the United States of America or of the territories or of any State.

Bylaws

The Board shall adopt, consistent with this Act and with concurrence from the Secretary, an appropriate bylaws, charter or operating model that shall describe— (1)the operational structure of the Bank, including the banks powers and limitation; (2)a description of the Bank’s fund and account structure; (3)procedures for payments and defaults; and (4)minimum borrower requirements.

Security

(a)

Aid interception

An interception of any Federal aid intended for a United States territory that has defaulted on an obligation to the Bank may be implemented, subject to the following conditions— (1)the Federal aid to be intercepted was explicit in the debt instrument signed by the territorial customer and the Bank; (2)the member or members of the Board appointed by the Secretary agreed to the specific designation in the debt instrument of sources of Federal aid that would be intercepted; (3)the Bank provides the Secretary with written certification of the default and a request to intercept the Federal Aid, and sends notice of the certification to the territorial customer; and (4)the Bank provides notice to the Federal departments or agencies administering those funds payable to the territorial customer that were explicit in the debt instrument. (b)

Directed payment

Following receipt of the written certification from the Bank provided for in subsection (a), the Secretary shall notify the Secretary of the Treasury of the default and the Federal aid to be intercepted. The Secretary of the Treasury shall pay the Federal aid funds that are intercepted to the Bank on the account of the territorial customer to defray principal and interest owed according the debt instrument.

Reports

The Bank shall prepare and submit to each official who has appointed a member of the Board a report on activities of the Bank for the preceding calendar year, and an audit of its books and accounts by in independent certified public accountant, within 90 days of the end of the calendar year. The report and audit shall be made available by request to the public.

10.

United States and territorial governments not obligated

(a)

United states not obligated

The deposit of Federal funds into the Bank established under this Act shall not be construed as a commitment, guarantee, or obligation on the part of the United States to any third party, nor shall any third party have any right against the United States for payment solely by virtue of the contribution. Any security or debt-financing instrument issued by the infrastructure bank shall expressly state that the security or instrument does not constitute a commitment, guarantee, or obligation of the United States. (b)

Obligations of territorial governments

A territorial customer is liable only for its obligations to the Bank, and not for the obligations and actions of the Bank.

11.

Local authority

Prior to a territory receiving financial assistance from the Bank, the Governor of the territory must sign or concur in a certification that the territory has appropriate legal authority to avail itself of the financial assistance offered by the Bank.

12.

Administration

(a)

Expenses

All expenses incurred by the Bank in carrying out the purposes of this Act shall be payable solely from revenues or fees collected by the Bank, except as provided in section 6(a) of this Act. (b)

Surety bonds

The following surety bonds to be paid by the Bank shall be required of the officials of the Bank— (1)$50,000 for the Chairman of the Board; (2)$50,000 for the President of the Bank; and (3)$25,000 for a member of the Board.

13.

Tax exemption

All activities, instruments, property, and income of the Bank shall be exempt from all manner of Federal, State, and local taxation.

14.

Additional participation

(a)

Extended eligibility

After the initial 5 years of the Bank’s existence, the Secretary, with the concurrence of each of the Governors of the American Samoa, Guam, the United States Virgin Islands, and the Commonwealth of the Northern Mariana Islands, may invite the governor of another United States territory to appoint a member of the Board and, at such time as the new member has been appointed, extend eligibility to that territory for Bank services. (b)

Voting members

If the number of voting members on the Board is an even number, the Secretary shall appoint another member.