[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5276 Introduced in House (IH)]

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114th CONGRESS
  2d Session
                                H. R. 5276

  To prohibit the provision of Federal funds to State, territory, and 
local governments for payment of obligations, to prohibit the Board of 
  Governors of the Federal Reserve System from financially assisting 
          State and local governments, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 18, 2016

Mr. Barr (for himself, Mr. Pittenger, Mr. Stewart, Mrs. Blackburn, Mr. 
Rokita, Mr. Yoder, Mr. Harris, Mr. Yoho, Mr. Jenkins of West Virginia, 
 Mr. Meadows, Mr. Bridenstine, Mr. Stutzman, Mr. Pompeo, Mr. Mulvaney, 
Mr. Brat, Mr. Jody B. Hice of Georgia, Mr. Rice of South Carolina, Mr. 
  Byrne, Mr. Walker, Mr. Fincher, Mr. Grothman, Mr. Babin, Mr. Austin 
Scott of Georgia, and Mrs. Lummis) introduced the following bill; which 
 was referred to the Committee on Oversight and Government Reform, and 
in addition to the Committee on Financial Services, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL


 
  To prohibit the provision of Federal funds to State, territory, and 
local governments for payment of obligations, to prohibit the Board of 
  Governors of the Federal Reserve System from financially assisting 
          State and local governments, and for other purposes.

    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 ``No Bailouts for State, Territory, 
and Local Governments Act''.

SEC. 2. PROHIBITION ON THE USE OF FEDERAL FUNDS TO PAY STATE AND LOCAL 
              OBLIGATIONS.

    (a) In General.--Notwithstanding any other provision of law, no 
Federal funds may be used to purchase or guarantee obligations of, 
issue lines of credit to, or provide direct or indirect grants-in-aid 
to any State government, municipal government, local government, or 
county government which, on or after January 1, 2013, has filed for 
bankruptcy, has defaulted on its obligations, is at risk of defaulting, 
or is likely to default, absent such assistance from the United States 
Government, if such purchase, guarantee, extension of credit, or grant 
is made for the purpose of assisting the government in--
            (1) avoiding defaulting on the payment of principal or 
        interest due on an obligation of the government; or
            (2) curing such a default.
    (b) Limit on Use of Borrowed Funds.--The Secretary of the Treasury 
shall not, directly or indirectly, use general fund revenues or funds 
borrowed pursuant to title 31, United States Code, to purchase or 
guarantee any asset or obligation of any State government, municipal 
government, local government, or county government, or otherwise to 
assist such government entity, if, on or after January 1, 2013, that 
State government, municipal government, or county government has filed 
for bankruptcy, defaulted on its obligations, is at risk of defaulting, 
or is likely to default, absent such assistance from the United States 
Government, if such purchase, guarantee, extension of credit, or grant 
is made for the purpose of assisting the government in--
            (1) avoiding defaulting on the payment of principal or 
        interest due on an obligation of the government; or
            (2) curing such a default.
    (c) Prohibition on Federal Reserve Assistance.--Notwithstanding any 
other provision of law, the Board of Governors of the Federal Reserve 
System shall not provide or extend to, or authorize with respect to, 
any State government, municipal government, local government, county 
government, or other entity that has taxing authority or bonding 
authority, any funds, loan guarantees, credits, or any other financial 
instrument or other authority, including the purchasing of the bonds of 
such State, municipality, locality, county, or other bonding authority, 
or to otherwise assist such government entity under any authority of 
the Board of Governors, if such purchase, guarantee, extension of 
credit, or grant is made for the purpose of assisting the government 
in--
            (1) avoiding defaulting on the payment of principal or 
        interest due on an obligation of the government; or
            (2) curing such a default.
    (d) Limitation.--Subsections (a) through (c) shall not apply to 
Federal assistance provided in response to a natural disaster.
    (e) State Defined.--For purposes of this section, the term 
``State'' means any of the several States, the District of Columbia, 
and any territory or possession of the United States.
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