[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 3715 Introduced in Senate (IS)]







110th CONGRESS
  2d Session
                                S. 3715

     To provide for emergency bridge loan assistance to automobile 
                 manufacturers and component suppliers.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           November 20, 2008

  Mr. Levin (for himself, Mr. Bond, Ms. Stabenow, Mr. Voinovich, Mr. 
Brown, Mr. Specter, and Mr. Casey) introduced the following bill; which 
     was read twice and referred to the Committee on Appropriations

_______________________________________________________________________

                                 A BILL


 
     To provide for emergency bridge loan assistance to automobile 
                 manufacturers and component suppliers.

    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 ``Auto Industry Emergency Bridge Loan 
Act''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Automobile manufacturer or component supplier.--The 
        term ``automobile manufacturer or component supplier'' means an 
        automobile manufacturer or component supplier or any successor 
        thereto.
            (2) Golden parachute payment.--The term ``golden parachute 
        payment'' means any payment to a senior executive officer for 
        departure from a company for any reason.
            (3) Financial viability.--The term ``financial viability'' 
        means, using generally acceptable accounting principles, that 
        there is a reasonable prospect that the applicant will be able 
        to make payments of principal and interest on the loan as and 
        when such payments become due under the terms of the loan 
        documents, and that the applicant has a net present value that 
        is positive.
            (4) Secretary.--The term ``Secretary'' means the Secretary 
        of Commerce.
            (5) Senior executive officer.--The term ``senior executive 
        officer'' means an individual who is one of the top five most 
        highly paid executives of a public company, whose compensation 
        is required to be disclosed pursuant to the Securities Exchange 
        Act of 1934, and any regulations issued thereunder, and 
        nonpublic company counterparts.

SEC. 3. AUTO INDUSTRY EMERGENCY BRIDGE LOAN PROGRAM.

    On or before March 31, 2009, the Secretary shall make loans from 
funds provided under this section to automobile manufacturers or 
component suppliers that have--
            (1) operations in the United States, the failure of which 
        would have a systemic adverse effect on the overall United 
        States economy or a significant loss of United States jobs, as 
        determined by the Secretary;
            (2) operated a manufacturing facility for the purposes of 
        producing automobiles or automobile components in the United 
        States throughout the 20-year period ending on the date of the 
        enactment of this Act; and
            (3) submitted a complete application for a loan under this 
        section pursuant to section 4(a), which has been determined 
        eligible under section 4(b).

SEC. 4. PLAN TO ENSURE FINANCIAL VIABILITY OF BORROWER.

    (a) In General.--At the time of application for a loan under this 
Act, an automobile manufacturer or component supplier shall submit to 
the Secretary a detailed plan that describes how the requested 
Government funds--
            (1) would be utilized to ensure the financial viability of 
        the manufacturer or supplier;
            (2) would stimulate automobile production in the United 
        States; and
            (3) would improve the capacity of the manufacturer or 
        supplier to pursue the timely and aggressive production of 
        energy-efficient advanced technology vehicles.
    (b) Plan Contents.--A plan submitted under this section shall 
detail cost control measures and performance goals and milestones.

SEC. 5. APPLICATIONS, ELIGIBILITY AND DISBURSEMENTS.

    (a) Applications.--On and after the date that is 3 days after the 
date of the enactment of this Act, the Secretary shall accept 
applications for loans under this Act.
    (b) Determination of Eligibility.--Not later than 15 days after the 
date on which the Secretary receives a complete application for a loan 
under subsection (a), the Secretary shall, after consultation with 
other Executive Branch officials, determine whether--
            (1) the applicant meets the requirements described in 
        sections 3 and 4;
            (2) the disbursement of funds and the successful 
        implementation of the required plan would ensure the financial 
        viability of the applicant; and
            (3) the applicant is therefore eligible to receive a loan 
        under this Act.
    (c) Disbursement.--The Secretary shall begin disbursement of the 
proceeds of a loan under this Act to an eligible applicant not later 
than 7 days after the date on which the Secretary receives a disbursal 
request from the applicant.
    (d) Warrants and Debt Instruments.--The Secretary may not make a 
loan under this Act unless the Secretary receives from the automobile 
manufacturer or component supplier a warrant or senior debt instrument 
from the manufacturer made in accordance with the requirements for a 
warrant or senior debt instrument by a financial institution under 
section 113(d) of the Emergency Economic Stabilization Act of 2008 
(division A of Public Law 110-343).

SEC. 6. REPLENISHMENT OF ADVANCED TECHNOLOGY VEHICLE MANUFACTURING 
              INCENTIVE PROGRAM.

    (a) Equity Sales.--
            (1) Sales authorized.--The Secretary may sell, exercise, or 
        surrender any equity instrument received under this Act.
            (2) Turnaround profits to restore advanced vehicles 
        manufacturing incentive program.--Proceeds received from a 
        sale, exercise, or surrender under paragraph (1) may be 
        credited to the appropriate Government financing account made 
        available to fulfill the advanced technology vehicle 
        manufacturing incentive purpose under section 136 of the Energy 
        Independence and Security Act of 2007 (Public Law 110-140; 42 
        U.S.C. 17013) until the amount loaned under this Act has been 
        repaid.
            (3) Reduction of public debt.--Proceeds received from a 
        sale, exercise, or surrender under paragraph (1) that takes 
        place after the amount loaned under this Act has been repaid in 
        accordance with paragraph (2) may be used to reduce the public 
        debt.
    (b) Repaid Loan Funds.--
            (1) In general.--Loan amounts repaid under this Act may be 
        credited to the appropriate Government financing account made 
        available to fulfill the advanced technology vehicle 
        manufacturing incentive purpose of section 136 of the Energy 
        Independence and Security Act of 2007 until the amount loaned 
        under this Act is repaid.
            (2) Reduction of public debt.--Loan amounts repaid under 
        this Act after the amount loaned under this Act has been repaid 
        may be used to reduce the public debt.

SEC. 7. LIMITS ON EXECUTIVE COMPENSATION.

    (a) Standards Required.--The Secretary shall require any recipient 
of a loan under this Act to meet appropriate standards for executive 
compensation and corporate governance.
    (b) Specific Requirements.--The standards established under 
subsection (a) shall include the following:
            (1) Limits on compensation that exclude incentives for 
        senior executive officers of a recipient of a loan under this 
        Act to take unnecessary and excessive risks that threaten the 
        value of such recipient during the period that the loan is 
        outstanding.
            (2) A provision for the recovery by such recipient of any 
        bonus or incentive compensation paid to a senior executive 
        officer based on statements of earnings, gains, or other 
        criteria that are later found to be materially inaccurate.
            (3) A prohibition on such recipient making any golden 
        parachute payment to a senior executive officer during the 
        period that the loan under this Act is outstanding.
            (4) A prohibition on such recipient paying or accruing any 
        bonus or incentive compensation during the period that the loan 
        under this Act is outstanding to any executive whose annual 
        base compensation exceeds $250,000 (which amount shall be 
        adjusted by the Secretary for inflation).
            (5) A prohibition on any compensation plan that could 
        encourage manipulation of the reported earnings of the 
        recipient to enhance compensation of any of its employees.

SEC. 8. PROHIBITION ON THE USE OF LOAN PROCEEDS FOR LOBBYING 
              ACTIVITIES.

    (a) In General.--A recipient of a loan under this Act may not use 
such funds for any lobbying expenditures or political contributions.
    (b) Definitions.--In this section:
            (1) Lobbying expenditures.--The term ``lobbying 
        expenditures'' has the meaning given the term in section 
        4911(c)(1) of the Internal Revenue Code of 1986.
            (2) Political contributions.--The term ``political 
        contribution'' means any contribution on behalf of a political 
        candidate or to a separate segregated fund described in section 
        316(b)(2)(C) of the Federal Election Campaign Act of 1971 (2 
        U.S.C. 441b(b)(2)(C)).

SEC. 9. PROHIBITION ON PAYMENT OF DIVIDENDS.

    No common stock dividends may be paid by any recipient of a loan 
under this Act for the duration of the loan.

SEC. 10. AUTO INDUSTRY EMERGENCY BRIDGE LOAN OVERSIGHT BOARD.

    (a) Establishment.--There is established the Auto Industry 
Emergency Bridge Loan Oversight Board (in this section referred to as 
the ``Board''), which shall be responsible for reviewing and providing 
advice concerning the exercise of authority under this Act, including--
            (1) the progress of the applicant in meeting the 
        performance goals and milestones under its financial viability 
        plan required under section 4;
            (2) recommending changes, as necessary and appropriate, to 
        the Secretary in meeting the goals and milestones under the 
        financial viability plan, and senior management and board of 
        directors to the automobile manufacturers and component 
        suppliers assisted under this Act; and
            (3) reporting any suspected fraud, misrepresentation, or 
        malfeasance to the Inspector General of the Department of 
        Commerce or the Attorney General of the United States, 
        consistent with section 535(b) of title 28, United States Code.
    (b) Membership.--The Board shall be comprised of--
            (1) the Secretary of Commerce;
            (2) the Secretary of Energy;
            (3) the Secretary of Transportation;
            (4) the Secretary of the Treasury;
            (5) the Secretary of Labor; and
            (6) the Administrator of the Environmental Protection 
        Agency.
    (c) Chairperson.--The chairperson of the Board shall be the 
Secretary of Commerce.
    (d) Meetings.--The Board shall meet--
            (1) not later than 14 days after the first disbursement of 
        funds provided under this Act; and
            (2) not less frequently than monthly thereafter.
    (e) Reports.--The Board shall report to the appropriate committees 
of Congress, not less frequently than quarterly, on the matters 
described under this section.
    (f) Oversight of Transactions and Financial Condition.--
            (1) Duty to inform.--During the period in which any loan 
        extended under this Act remains outstanding, the recipient of 
        such loan shall promptly inform the Secretary and the Board 
        of--
                    (A) any asset sale, investment, or commitment for 
                any asset sale or investment proposed to be entered 
                into by such recipient that has a value in excess of 
                $25,000,000; and
                    (B) any other material change in the financial 
                condition of such recipient.
            (2) Authority of the secretary.--During the period in which 
        any loan extended under this Act remains outstanding, the 
        Secretary, in consultation with the Board, may--
                    (A) promptly review any asset sale or investment 
                described in paragraph (1) or any commitment for such 
                asset sale or investment; and
                    (B) direct the recipient of the loan that it should 
                not consummate such proposed sale or investment or 
                commitment for such sale or investment.
            (3) Regulations.--The Board may establish, by regulation, 
        procedures for conducting any review under this subsection.
    (g) Termination.--The Board, and its authority under this section, 
shall terminate not later than 6 months after the date on which the 
last loan amounts under this section are repaid.

SEC. 11. PRIORITIZATION OF LOAN ALLOCATIONS.

    In allocating loan amounts under this Act, the Secretary shall 
consider the magnitude of the impact of the manufacturing operations of 
the applicant in the United States on the overall economy of the United 
States and other segments of the automobile industry, including the 
impact on levels of employment, domestic manufacturing of automobiles 
and automobile components, and automobile dealerships.

SEC. 12. RATE OF INTEREST.

    The annual rate of interest for a loan under this Act shall be--
     (a) 5 percent during the 5-year period beginning on the date on 
which the Secretary disburses the loan; and
    (b) 9 percent after the end of the period described in paragraph 
(1).

SEC. 13. NO PREPAYMENT PENALTY.

    A loan made under this Act shall be prepayable without penalty at 
any time.

SEC. 14. DISCHARGE.

    A discharge under title 11, United States Code, shall not discharge 
the borrower from any debt for funds authorized to be disbursed under 
this Act.

SEC. 15. FEES.

    (a) In General.--The Secretary may charge and collect fees for 
disbursements under this Act in amounts that the Secretary determines 
are sufficient to cover applicable administrative expenses.
    (b) Availability.--Fees collected under this section--
            (1) shall be deposited by the Secretary into the Treasury 
        of the United States;
            (2) shall be used by the Secretary to pay administrative 
        expenses of making awards and loans under this Act; and
            (3) shall remain available until expended, without further 
        appropriation.

SEC. 16. JUDICIAL REVIEW AND RELATED MATTERS.

    (a) Standards.--Actions by the Secretary pursuant to the authority 
of this Act shall be subject to chapter 7 of title 5, United States 
Code, including that such final actions shall be held unlawful and set 
aside if found to be arbitrary, capricious, an abuse of discretion, or 
not in accordance with law.
    (b) Limitations on Equitable Relief.--
            (1) Injunction.--No injunction or other form of equitable 
        relief shall be issued against the Secretary for actions 
        pursuant to this Act, other than to remedy a violation of the 
        Constitution.
            (2) Temporary restraining order.--Any request for a 
        temporary restraining order against the Secretary for actions 
        pursuant to this Act shall be considered and granted or denied 
        by the court within 3 days of the date of the request.
            (3) Preliminary injunction.--Any request for a preliminary 
        injunction against the Secretary for actions pursuant to this 
        Act shall be considered and granted or denied by the court on 
        an expedited basis consistent with the provisions of rule 
        65(b)(3) of the Federal Rules of Civil Procedure, or any 
        successor to such rule.
            (4) Permanent injunction.--Any request for a permanent 
        injunction against the Secretary for actions pursuant to this 
        Act shall be considered and granted or denied by the court on 
        an expedited basis. Whenever possible, the court shall 
        consolidate trial on the merits with any hearing on a request 
        for a preliminary injunction, consistent with the provisions of 
        rule 65(a)(2) of the Federal Rules of Civil Procedure, or any 
        successor to such rule.
            (5) Limitation on actions by participating companies.--No 
        action or claims may be brought against the Secretary by any 
        person that divests its assets with respect to its 
        participation in a program under this Act, except as provided 
        in paragraph (1), other than as expressly provided in a written 
        contract with the Secretary.
            (6) Stays.--Any injunction or other form of equitable 
        relief issued against the Secretary for actions pursuant to 
        this Act shall be automatically stayed. The stay shall be 
        lifted, unless the Secretary seeks a stay from a higher court 
        within 3 calendar days after the date on which the relief is 
        issued.
    (c) Savings Clause.--Any exercise of the authority of the Secretary 
pursuant to this section shall not impair the claims or defenses that 
would otherwise apply with respect to persons other than the Secretary.

SEC. 17. FUNDING.

    (a) In General.--The $7,500,000,000 appropriated for fiscal year 
2009 for direct loans under section 129 of the Consolidated Security, 
Disaster Assistance, and Continuing Appropriations Act, 2009 (division 
A of Public Law 110-329) is rescinded.
    (b) Appropriations.--There is appropriated to the Secretary of 
Commerce $7,500,000,000 to the ``Department of Commerce--Emergency 
Bridge Loan Program Account'' for the cost of direct loans authorized 
under this Act, which shall remain available until expended. 
Commitments for direct loans using such amount shall not exceed 
$25,000,000,000 in total loan principal. The cost of such direct loans, 
including the cost of modifying such loans, shall be calculated in 
accordance with section 502 of the Congressional Budget Act of 1974 (2 
U.S.C. 661a).
    (c) Transfers for Direct Loans.--Following the receipt of a notice 
from the Secretary of Energy certifying the approval of a loan under 
the program authorized under section 136 of the Energy Independence and 
Security Act of 2007 (Public Law 110-140; 42 U.S.C. 17013), the 
Secretary may transfer amounts made available under this Act to the 
Secretary of Energy, in an amount sufficient for the cost of the direct 
loans if such transfer would not cause the Secretary to exceed the 
total appropriation and total commitment level authorized under 
subsection (b). Any amounts so transferred shall be available to the 
Secretary of Energy without fiscal year limitation and subject to the 
terms and conditions described in section 129 of the Consolidated 
Security, Disaster Assistance, and Continuing Appropriations Act, 2009.
    (d) Use of Remaining Amounts.--Amounts appropriated under 
subsection (b) which remain available after March 31, 2009, shall be 
transferred to the Secretary of Energy and shall be used to carry out 
section 136 of the Energy Independence and Security Act of 2007, 
subject to the terms and conditions described in section 129 of the 
Consolidated Security, Disaster Assistance, and Continuing 
Appropriations Act, 2009.

SEC. 18. COORDINATION WITH OTHER LAWS REGARDING PROMOTION OF ADVANCED 
              TECHNOLOGY VEHICLE MANUFACTURING.

    Nothing in the Act may be construed as altering, affecting, or 
superseding the provisions of section 136 of the Energy Independence 
and Security Act of 2007, relating to the technology requirements for 
energy efficient vehicles.
                                 <all>