[Congressional Record Volume 143, Number 70 (Friday, May 23, 1997)]
[Senate]
[Pages S5133-S5138]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CAMPBELL (for himself and Mr. Inouye):
  S. 818. A bill to improve the economic conditions and supply of 
housing in native American communities by creating the Native American 
Financial Services Organization, and for other purposes; to the 
Committee on Indian Affairs.


    the native american financial services organization Act of 1997

  Mr. CAMPBELL. Mr. President, today I introduce the Native American 
Financial Services Organization Act of 1996 [NAFSO]. This bill, based 
on a similar measure I introduced in the last Congress, seeks to 
provide new opportunity and hope for native American families by 
addressing the serious lack of private capital on Indian reservations.
  Having access to banking services is more than just a convenience. It 
means being able to get a loan to fix a leaky roof. It means getting 
the money to buy computers to start a small business. It means having 
enough money to send your son or daughter to college. It means buying 
your own home.
  Too often, these dreams never become a reality for Indian families. 
Many opportunities and services most of America takes for granted are 
not available in Indian country. Native Americans can't simply walk 
into a local bank to open a checking account or get a loan for a new 
house because for the most part, these institutions are nowhere near 
Indian reservations.
  NAFSO is not about new Government programs or bureaucracy. NAFSO is 
about supporting private banks that will not only provide basic 
services, but take the time to educate people, to bring them into the 
mainstream of financial services and give them a chance to build a home 
or start a business.
  NAFSO gives native Americans the same kind of access to banking 
services that other Americans enjoy. By eliminating provisions dealing 
with the secondary mortgage market, this version of NAFSO allows the 
organization to focus where the rubber meets the road. Working in 
conjunction with the community development financial institutions fund, 
NAFSO's primary role is to expand the availability of basic banking 
services through the creation and support of Native American Financial 
Institutions [NAFI's]. This provides the services that families need 
the most--checking accounts, mortgages, and other basic banking 
services.
  NAFSO will also play a crucial role in assisting NAFI's by providing 
them with much-needed technical assistance and developing specialized 
assistance to overcome barriers to lending on reservations. The 
organization will also work with the secondary market and other 
important financial mechanisms to identify barriers to private lending 
and make recommendations about how banks, Tribes, and government can do 
more to help this process.
  NAFSO does more than support new lending institutions or existing 
Indian-oriented banks and begins to address the historical barriers to 
private banking in Indian country. The trust status of reservation land 
and the inability to transfer title are serious concerns of bankers 
that need to be overcome and understood. Equally as challenging is the 
need to overcome stereotypes about Indian families and their social or 
economic condition. Often, banks decide Indians are not a good credit 
risk without ever having gone to the reservation.
  By providing information and interested in becoming more involved in 
Indian country, NAFSO can foster a new understanding of the real 
challenges we face. It can eliminate some of these misconceptions and 
myths and bring the private market and Indian communities together in 
ways never thought possible before.
  I had hoped that we would be assisted in this process by a report by 
the community development financial institutions fund at the Department 
of Treasury on Indian banking issues. Regrettably, work on that report, 
which was

[[Page S5134]]

due almost 9 months ago, has not yet begun. Nevertheless, I feel that 
we should not delay our work. We need to concentrate now on finding 
real solutions to the economic, social and cultural challenges facing 
tribes and native American families.
  Mr. President, most people agree that Government cannot be the 
solution to all of this great Nation's problems. We can fix the 
Government programs, we can make them more efficient, but now we need 
to get the private sector involved in the challenges facing Indian 
country. The road to economic independence for all native American 
communities is a long one, but this bill is a big step in the right 
direction.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:
                                 S. 818
       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       (a) Short Title.--This Act may be cited as the ``Native 
     American Financial Services Organization Act of 1997''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title.
Sec. 2. Findings.
Sec. 3. Policy.
Sec. 4. Purposes.
Sec. 5. Definitions.

        TITLE I--NATIVE AMERICAN FINANCIAL SERVICES ORGANIZATION

Sec. 101. Establishment of the Organization.
Sec. 102. Authorized assistance and service functions.
Sec. 103. Native American lending services grant.
Sec. 104. Audits.
Sec. 105. Annual housing and economic development reports.
Sec. 106. Advisory Council.

                TITLE II--CAPITALIZATION OF ORGANIZATION

Sec. 201. Capitalization of the Organization.

            TITLE III--REGULATION, EXAMINATION, AND REPORTS

Sec. 301. Regulation, examination, and reports.
Sec. 302. Authority of the Secretary of Housing and Urban Development.

                 TITLE IV--FORMATION OF NEW CORPORATION

Sec. 401. Formation of new corporation.
Sec. 402. Adoption and approval of merger plan.
Sec. 403. Consummation of merger.
Sec. 404. Transition.
Sec. 405. Effect of merger.

               TITLE V--AUTHORIZATIONS OF APPROPRIATIONS

Sec. 501. Authorization of appropriations for Native American Financial 
              Institutions.
Sec. 502. Authorization of appropriations for Organization.

     SEC. 2. FINDINGS.

       Congress finds that--
       (1) clause 3 of section 8 of article I of the United States 
     Constitution recognizes the special relationship between the 
     United States and Indian tribes;
       (2) Congress has carried the responsibility of the United 
     States for the protection and preservation of Indian tribes 
     and the resources of Indian tribes through the endorsement of 
     treaties, and the enactment of other laws, including laws 
     that provide for the exercise of administrative authorities;
       (3) despite the availability of abundant natural resources 
     on Indian lands and a rich cultural legacy that accords great 
     value to self-determination, self-reliance, and independence, 
     American Indians, Alaska Natives, and Native Hawaiians suffer 
     rates of unemployment, poverty, poor health, substandard 
     housing, and associated social ills to a greater degree than 
     any other group in the United States;
       (4) the economic success and material well-being of 
     American Indian, Alaska Native, and Native Hawaiian 
     communities depends on the combined efforts of the Federal 
     Government, tribal governments, the private sector, and 
     individuals;
       (5) the lack of employment opportunities and affordable 
     homes in the communities referred to in paragraph (4) is 
     grounded in the almost complete absence of available private 
     capital and private capital institutions to serve those 
     communities;
       (6) the lack of capital referred to in paragraph (5) has 
     resulted in a multigenerational dependence on Federal 
     assistance that is--
       (A) insufficient to address the magnitude of needs; and
       (B) unreliable in availability;
       (7) a review of the history of the United States bears out 
     the fact that solutions to social and economic problems that 
     have been crafted by the Federal Government without the 
     active involvement of local communities and the private 
     sector fail at unacceptably high rates; and
       (8) the twin goals of economic self-sufficiency and 
     political self-determination for American Indians, Alaska 
     Natives, and Native Hawaiians can best be served by making 
     available to address the challenges faced by those groups--
       (A) the resources of the private market;
       (B) adequate capital; and
       (C) technical expertise.

     SEC. 3. POLICY.

       (a) In General.--Based upon the findings and 
     recommendations of the Commission on American Indian, Alaska 
     Native and Native Hawaiian Housing established by the 
     Department of Housing and Urban Development Reform Act of 
     1989, Congress has determined that--
       (1) housing shortages and deplorable living conditions are 
     at crisis proportions in Native American communities 
     throughout the United States; and
       (2) the lack of private capital to finance housing and 
     economic development for Native Americans and Native American 
     communities seriously exacerbates these housing shortages and 
     poor living conditions.
       (b) Policy of the United States To Address Native American 
     Housing Shortage.--It is the policy of the United States to 
     improve the economic conditions and supply of housing in 
     Native American communities throughout the United States by 
     creating the Native American Financial Services Organization 
     to address the housing shortages and poor living conditions 
     described in subsection (a).

     SEC. 4. PURPOSES.

       The purposes of this Act are--
       (1) to help serve the mortgage and other lending needs of 
     Native Americans by assisting in the establishment and 
     organization of Native American Financial Institutions, 
     developing and providing financial expertise and technical 
     assistance to Native American Financial Institutions, 
     including assistance concerning overcoming--
       (A) barriers to lending with respect to Native American 
     lands; and
       (B) the past and present impact of discrimination;
       (2) to promote access to mortgage credit in Native American 
     communities in the United States by increasing the liquidity 
     of financing for housing and improving the distribution of 
     investment capital available for such financing, primarily 
     through Native American Financial Institutions; and
       (3) to promote the infusion of public capital into Native 
     American communities throughout the United States and to 
     direct sources of public and private capital into housing and 
     economic development for Native American individuals and 
     families, primarily through Native American Financial 
     Institutions.

     SEC. 5. DEFINITIONS.

       In this Act:
       (1) Alaska native.--The term ``Alaska Native'' has the 
     meaning given the term ``Native'' by section 3(b) of the 
     Alaska Native Claims Settlement Act.
       (2) Board.--The term ``Board'' means the Board of Directors 
     of the Organization established under section 101(a)(2).
       (3) Chairperson.--The term ``Chairperson'' means the 
     chairperson of the Board.
       (4) Council.--The term ``Council'' means the Advisory 
     Council established under section 106.
       (5) Designated merger date.--The term ``designated merger 
     date'' means the specific calendar date and time of day 
     designated by the Board under section 402(b).
       (6) Department of hawaiian home lands.--The term 
     ``Department of Hawaiian Home Lands'' means the agency that 
     is responsible for the administration of the Hawaiian Homes 
     Commission Act, 1920 (42 Stat. 108 et seq.).
       (7) Fund.--The term ``Fund'' means the Community 
     Development Financial Institutions Fund established under 
     section 104 of the Riegle Community Development and 
     Regulatory Improvement Act of 1994 (12 U.S.C. 4703).
       (8) Indian tribe.--The term ``Indian tribe'' means any 
     Indian tribe, band, nation, or other organized group or 
     community, including any Alaska Native village or regional or 
     village corporation as defined in or established pursuant to 
     the Alaska Native Claims Settlement Act that is recognized as 
     eligible for the special programs and services provided by 
     the Federal Government to Indians because of their status as 
     Indians.
       (9) Merger plan.--The term ``merger plan'' means the plan 
     of merger adopted by the Board under section 402(a).
       (10) Native american.--The term ``Native American'' means 
     any member of an Indian tribe or a Native Hawaiian.
       (11) Native american financial institution.--The term 
     ``Native American Financial Institution'' means a person 
     (other than an individual) that--
       (A) qualifies as a community development financial 
     institution under section 103 of the Riegle Community 
     Development and Regulatory Improvement Act of 1994 (12 U.S.C. 
     4702);
       (B) satisfies the requirements established by subtitle A of 
     title I of the Riegle Community Development and Regulatory 
     Improvement Act of 1994 (12 U.S.C. 4701 et seq.) and the Fund 
     for applicants for assistance from the Fund;
       (C) demonstrates a special interest and expertise in 
     serving the primary economic development and mortgage lending 
     needs of the Native American community; and
       (D) demonstrates that the person has the endorsement of the 
     Native American community that the person intends to serve.

[[Page S5135]]

       (12) Native american lender.--The term ``Native American 
     lender'' means a Native American governing body, Native 
     American housing authority, or other Native American 
     Financial Institution that acts as a primary mortgage or 
     economic development lender in a Native American community.
       (13) Native hawaiian.--The term ``Native Hawaiian'' has the 
     meaning given that term in section 201 of the Hawaiian Homes 
     Commission Act, 1920 (42 Stat. 108).
       (14) New corporation.--The term ``new corporation'' means 
     the corporation formed in accordance with title IV.
       (15) Organization.--The term ``Organization'' means the 
     Native American Financial Services Organization established 
     under section 101.
       (16) Secretary.--The term ``Secretary'' means the Secretary 
     of Housing and Urban Development.
       (17) Transition period.--The term ``transition period'' 
     means the period beginning on the date on which the merger 
     plan is approved by the Secretary and ending on the 
     designated merger date.
        TITLE I--NATIVE AMERICAN FINANCIAL SERVICES ORGANIZATION

     SEC. 101. ESTABLISHMENT OF THE ORGANIZATION.

       (a) Creation; Board of Directors; Policies; Principal 
     Office; Membership; Vacancies.--
       (1) Creation.--
       (A) In general.--There is established and chartered a 
     corporation to be known as the Native American Financial 
     Services Organization.
       (B) Period of time.--The Organization shall be a 
     congressionally chartered body corporate until the earlier 
     of--
       (i) the designated merger date; or
       (ii) the date on which the charter is surrendered by the 
     Organization.
       (C) Changes to charter.--The right to revise, amend, or 
     modify the Organization charter is specifically and 
     exclusively reserved to Congress.
       (2) Board of directors; principal office.--
       (A) Board.--The powers of the Organization shall be vested 
     in a Board of Directors. The Board shall determine the 
     policies that govern the operations and management of the 
     Organization.
       (B) Principal office; residency.--The principal office of 
     the Organization shall be in the District of Columbia. For 
     purposes of venue, the Organization shall be considered to be 
     a resident of the District of Columbia.
       (3) Membership.--
       (A) In general.--
       (i) Nine members.--Except as provided in clause (ii), the 
     Board shall consist of 9 members, 3 of whom shall be 
     appointed by the President and 6 of whom shall be elected by 
     the class A stockholders, in accordance with the bylaws of 
     the Organization.
       (ii) Thirteen members.--If class B stock is issued under 
     section 201(b), the Board shall consist of 13 members, 9 of 
     whom shall be appointed and elected in accordance with clause 
     (i) and 4 of whom shall be elected by the class B 
     stockholders, in accordance with the bylaws of the 
     Organization.
       (B) Terms.--Each member of the Board shall be elected or 
     appointed for a 4-year term, except that the members of the 
     initial Board shall be elected or appointed for the following 
     terms:
       (i) Of the 3 members appointed by the President--

       (I) 1 member shall be appointed for a 2-year term;
       (II) 1 member shall be appointed for a 3-year term; and
       (III) 1 member shall be appointed for a 4-year term;

     as designated by the President at the time of the 
     appointments.
       (ii) Of the 6 members elected by the class A stockholders--

       (I) 2 members shall each be elected for a 2-year term;
       (II) 2 members shall each be elected for a 3-year term; and
       (III) 2 members shall each be elected for a 4-year term.

       (iii) If class B stock is issued and 4 additional members 
     are elected by the class B stockholders--

       (I) 1 member shall be elected for a 2-year term;
       (II) 1 member shall be elected for a 3-year term; and
       (III) 2 members shall each be elected for a 4-year term.

       (C) Qualifications.--Each member appointed by the President 
     shall have expertise in 1 or more of the following areas:
       (i) Native American housing and economic development 
     programs.
       (ii) Financing in Native American communities.
       (iii) Native American governing bodies and court systems.
       (iv) Restricted and trust land issues, economic 
     development, and small consumer loans.
       (D) Members of indian tribes.--Not less than 2 of the 
     members appointed by the President shall each be an member of 
     an Indian tribe who is enrolled in accordance with the 
     applicable requirements of that Indian tribe.
       (E) Chairperson.--The Board shall select a Chairperson from 
     among its members, except that the initial Chairperson shall 
     be selected from among the members of the initial Board who 
     have been appointed or elected to serve for a 4-year term.
       (F) Vacancies.--
       (i) Appointed members.--Any vacancy in the appointed 
     membership of the Board shall be filled by appointment by the 
     President, but only for the unexpired portion of the term.
       (ii) Elected members.--Any vacancy in the elected 
     membership of the Board shall be filled by appointment by the 
     Board, but only for the unexpired portion of the term.
       (G) Transitions.--Any member of the Board may continue to 
     serve after the expiration of the term for which the member 
     was appointed or elected until a qualified successor has been 
     appointed or elected.
       (b) Powers of the Organization.--The Organization--
       (1) shall adopt bylaws, consistent with this Act, 
     regulating, among other things, the manner in which--
       (A) the business of the Organization shall be conducted;
       (B) the elected members of the Board shall be elected;
       (C) the stock of the Organization shall be issued, held, 
     and disposed of;
       (D) the property of the Organization shall be disposed of; 
     and
       (E) the powers and privileges granted to the Organization 
     by this Act and other law shall be exercised;
       (2) may make and perform contracts, agreements, and 
     commitments, including entering into a cooperative agreement 
     with the Secretary;
       (3) may prescribe and impose fees and charges for services 
     provided by the Organization;
       (4) may, if such settlement, adjustment, compromise, 
     release, or waiver is not adverse to the interests of the 
     United States--
       (A) settle, adjust, and compromise; and
       (B) with or without consideration or benefit to the 
     Organization, release or waive in whole or in part, in 
     advance or otherwise, any claim, demand, or right of, by, or 
     against the Organization;
       (5) may sue and be sued, complain and defend, in any 
     tribal, Federal, State, or other court;
       (6) may acquire, take, hold, and own, and to deal with and 
     dispose of any property;
       (7) may determine the necessary expenditures of the 
     Organization and the manner in which such expenditures shall 
     be incurred, allowed, and paid, and appoint, employ, and fix 
     and provide for the compensation and benefits of officers, 
     employees, attorneys, and agents as the Board determines 
     reasonable and not inconsistent with this section;
       (8) may incorporate a new corporation under State, District 
     of Columbia, or tribal law, as provided in section 401;
       (9) may adopt a plan of merger, as provided in section 402;
       (10) may consummate the merger of the Organization into the 
     new corporation, as provided in section 403; and
       (11) may have succession until the designated merger date 
     or any earlier date on which the Organization surrenders its 
     Federal charter.
       (c) Investment of Funds; Designation as Depositary, 
     Custodian, or Agent.--
       (1) Investment of funds.--Funds of the Organization that 
     are not required to meet current operating expenses shall be 
     invested in obligations of, or obligations guaranteed by, the 
     United States or any agency thereof, or in obligations, 
     participations, or other instruments that are lawful 
     investments for fiduciary, trust, or public funds.
       (2) Designation as depositary, custodian, or agent.--Any 
     Federal Reserve bank or Federal home loan bank, or any bank 
     as to which at the time of its designation by the 
     Organization there is outstanding a designation by the 
     Secretary of the Treasury as a general or other depositary of 
     public money, may--
       (A) be designated by the Organization as a depositary or 
     custodian or as a fiscal or other agent of the Organization; 
     and
       (B) act as such depositary, custodian, or agent.
       (d) Actions By and Against the Organization.--
     Notwithstanding section 1349 of title 28, United States Code, 
     or any other provision of law--
       (1) the Organization shall be deemed to be an agency 
     covered under sections 1345 and 1442 of title 28, United 
     States Code;
       (2) any civil action to which the Organization is a party 
     shall be deemed to arise under the laws of the United States, 
     and the appropriate district court of the United States shall 
     have original jurisdiction over any such action, without 
     regard to amount or value; and
       (3) in any case in which all remedies have been exhausted 
     in accordance with the applicable ordinances of an Indian 
     tribe, in any civil or other action, case, or controversy in 
     a tribal court, court of a State, or in any court other than 
     a district court of the United States, to which the 
     Organization is a party, may at any time before the 
     commencement of the trial be removed by the Organization, 
     without the giving of any bond or security and by following 
     any procedure for removal of causes in effect at the time of 
     the removal--
       (A) to the district court of the United States for the 
     district and division in which the action is pending; or
       (B) if there is no such district court, to the district 
     court of the United States for the District of Columbia.

     SEC. 102. AUTHORIZED ASSISTANCE AND SERVICE FUNCTIONS.

       The Organization may--

[[Page S5136]]

       (1) assist in the planning establishment and organization 
     of Native American Financial Institutions;
       (2) develop and provide financial expertise and technical 
     assistance to Native American Financial Institutions, 
     including methods of underwriting, securing, servicing, 
     packaging, and selling mortgage and small commercial and 
     consumer loans;
       (3) develop and provide specialized technical assistance on 
     overcoming barriers to primary mortgage lending on Native 
     American lands, including issues related to trust lands, 
     discrimination, high operating costs, and inapplicability of 
     standard underwriting criteria;
       (4) provide mortgage underwriting assistance (but not in 
     originating loans) under contract to Native American 
     Financial Institutions;
       (5) work with the Federal National Mortgage Association, 
     the Federal Home Loan Mortgage Corporation, and other 
     participants in the secondary market for home mortgage 
     instruments in identifying and eliminating barriers to the 
     purchase of Native American mortgage loans originated by 
     Native American Financial Institutions and other lenders in 
     Native American communities;
       (6) obtain capital investments in the Organization from 
     Indian tribes, Native American organizations, and other 
     entities;
       (7) act as an information clearinghouse by providing 
     information on financial practices to Native American 
     Financial Institutions;
       (8) monitor and report to Congress on the performance of 
     Native American Financial Institutions in meeting the 
     economic development and housing credit needs of Native 
     Americans; and
       (9) provide any of the services described in this section 
     directly, or under a contract authorizing another national or 
     regional Native American financial services provider to 
     assist the Organization in carrying out the purposes of this 
     Act.

     SEC. 103. NATIVE AMERICAN LENDING SERVICES GRANT.

       (a) Initial Grant Payment.--If the Secretary and the 
     Organization enter into a cooperative agreement for the 
     Organization to provide technical assistance and other 
     services to Native American Financial Institutions, such 
     agreement shall, to the extent that funds are available as 
     provided in section 502, provide that the initial grant 
     payment, anticipated to be $5,000,000, shall be made when all 
     members of the initial Board have been appointed under 
     section 101.
       (b) Payment of Grant Balance.--The payment of the grant 
     balance of $5,000,000 shall be made to the Organization not 
     later than 1 year after the date on which the initial grant 
     payment is made under subsection (a).

     SEC. 104. AUDITS.

       (a) Independent Audits.--
       (1) In general.--The Organization shall have an annual 
     independent audit made of its financial statements by an 
     independent public accountant in accordance with generally 
     accepted auditing standards.
       (2) Determinations.--In conducting an audit under this 
     subsection, the independent public accountant shall determine 
     and report on whether the financial statements of the 
     Organization--
       (A) are presented fairly in accordance with generally 
     accepted accounting principles; and
       (B) to the extent determined necessary by the Secretary, 
     comply with any disclosure requirements imposed under section 
     301.
       (b) GAO Audits.--
       (1) In general.--Beginning after the first 2 years of the 
     operation of the Organization, unless an earlier date is 
     required by any other statute, grant, or agreement, the 
     programs, activities, receipts, expenditures, and financial 
     transactions of the Organization shall be subject to audit by 
     the Comptroller General of the United States under such rules 
     and regulations as may be prescribed by the Comptroller 
     General.
       (2) Access.--To carry out this subsection, the 
     representatives of the General Accounting Office shall--
       (A) have access to all books, accounts, financial records, 
     reports, files, and all other papers, things, or property 
     belonging to or in use by the Organization and necessary to 
     facilitate the audit;
       (B) be afforded full facilities for verifying transactions 
     with the balances or securities held by depositaries, fiscal 
     agents, and custodians; and
       (C) have access, upon request to the Organization or any 
     auditor for an audit of the Organization under subsection 
     (a), to any books, accounts, financial records, reports, 
     files, or other papers, or property belonging to or in use by 
     the Organization and used in any such audit and to any 
     papers, records, files, and reports of the auditor used in 
     such an audit.
       (3) Reports.--The Comptroller General of the United States 
     shall submit to Congress a report on each audit conducted 
     under this subsection.
       (4) Reimbursement.--The Organization shall reimburse the 
     General Accounting Office for the full cost of any audit 
     conducted under this subsection.

     SEC. 105. ANNUAL HOUSING AND ECONOMIC DEVELOPMENT REPORTS.

       Not later than 1 year after the date of enactment of this 
     Act, and annually thereafter, the Organization shall collect, 
     maintain, and provide to the Secretary, in a form determined 
     by the Secretary, such data as the Secretary determines to be 
     appropriate with respect to the activities of the 
     Organization relating to economic development.

     SEC. 106. ADVISORY COUNCIL.

       (a) Establishment.--The Board shall establish an Advisory 
     Council in accordance with this section.
       (b) Membership.--
       (1) In general.--The Council shall consist of 13 members, 
     who shall be appointed by the Board, including 1 
     representative from each of the 12 districts established by 
     the Bureau of Indian Affairs and 1 representative from the 
     State of Hawaii.
       (2) Qualifications.--Not less than 6 of the members of the 
     Council shall have financial expertise, and not less than 9 
     members of the Council shall be Native Americans.
       (3) Terms.--Each member of the Council shall be appointed 
     for a 4-year term, except that the initial Council shall be 
     appointed, as designated by the Board at the time of 
     appointment, as follows:
       (A) Four members shall each be appointed for a 2-year term.
       (B) Four members shall each be appointed for a 3-year term.
       (C) Five members shall each be appointed for a 4-year term.
       (c) Duties.--The Council shall advise the Board on all 
     policy matters of the Organization. Through the regional 
     representation of its members, the Council shall provide 
     information to the Board from all sectors of the Native 
     American community.
                TITLE II--CAPITALIZATION OF ORGANIZATION

     SEC. 201. CAPITALIZATION OF THE ORGANIZATION.

       (a) Class A Stock.--The class A stock of the Organization 
     shall--
       (1) be issued only to Indian tribes and the Department of 
     Hawaiian Home Lands;
       (2) be allocated--
       (A) with respect to Indian tribes, on the basis of Indian 
     tribe population, as determined by the Secretary in 
     consultation with the Secretary of the Interior, in such 
     manner as to issue 1 share for each member of an Indian 
     tribe; and
       (B) with respect to the Department of Hawaiian Home Lands, 
     on the basis of the number of current leases at the time of 
     allocation;
       (3) have such par value and other characteristics as the 
     Organization shall provide;
       (4) be issued in such manner as voting rights may only be 
     vested upon purchase of those rights from the Organization by 
     an Indian tribe or the Department of Hawaiian Home Lands, 
     each share being entitled to 1 vote; and
       (5) be nontransferable.
       (b) Class B Stock.--
       (1) In general.--The Organization may issue class B stock 
     evidencing capital contributions in the manner and amount, 
     and subject to any limitations on concentration of ownership, 
     as may be established by the Organization.
       (2) Characteristics.--Any class B stock issued under 
     paragraph (1) shall--
       (A) be available for purchase by investors;
       (B) be entitled to such dividends as may be declared by the 
     Board in accordance with subsection (c);
       (C) have such par value and other characteristics as the 
     Organization shall provide;
       (D) be vested with voting rights, each share being entitled 
     to 1 vote; and
       (E) be transferable only on the books of the Organization.
       (c) Charges and Fees; Earnings.--
       (1) Charges and fees.--The Organization may impose charges 
     or fees, which may be regarded as elements of pricing, with 
     the objectives that--
       (A) all costs and expenses of the operations of the 
     Organization should be within the income of the Organization 
     derived from such operations; and
       (B) such operations would be fully self-supporting.
       (2) Earnings.--All earnings from the operations of the 
     Organization shall be annually transferred to the general 
     surplus account of the Organization. At any time, funds in 
     the general surplus account may, in the discretion of the 
     Board, be transferred to the reserves of the Organization.
       (d) Capital Distributions.--
       (1) In general.--Except as provided in paragraph (2), the 
     Organization may make such capital distributions (as such 
     term is defined in section 1303 of the Federal Housing 
     Enterprise Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4502)) as may be declared by the Board. All capital 
     distributions shall be charged against the general surplus 
     account of the Organization.
       (2) Restriction.--The Organization may not make any capital 
     distribution that would decrease the total capital (as such 
     term is defined in section 1303 of the Federal Housing 
     Enterprise Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4502)) of the Organization to an amount less than the 
     capital level for the Organization established under section 
     301, without prior written approval of the distribution by 
     the Secretary.
            TITLE III--REGULATION, EXAMINATION, AND REPORTS

     SEC. 301. REGULATION, EXAMINATION, AND REPORTS.

       (a) In General.--The Organization shall be subject to the 
     regulatory authority of the Department of Housing and Urban 
     Development with respect to all matters relating to the 
     financial safety and soundness of the Organization.

[[Page S5137]]

       (b) Duty of Secretary.--The Secretary shall ensure that the 
     Organization is adequately capitalized and operating safely 
     as a congressionally chartered body corporate.
       (c) Reports to Secretary.--
       (1) Annual reports.--Not later than 1 year after the date 
     of enactment of this Act, and annually thereafter, the 
     Organization shall submit to the Secretary a report 
     describing the financial condition and operations of the 
     Organization. The report shall be in such form, contain such 
     information, and be submitted on such date as the Secretary 
     shall require.
       (2) Contents of reports.--Each report submitted under this 
     subsection shall contain a declaration by the president, vice 
     president, treasurer, or any other officer of the 
     Organization designated by the Board to make such 
     declaration, that the report is true and correct to the best 
     of the knowledge and belief of that officer.

     SEC. 302. AUTHORITY OF THE SECRETARY OF HOUSING AND URBAN 
                   DEVELOPMENT.

       The Secretary shall--
       (1) have general regulatory power over the Organization; 
     and
       (2) issue such rules and regulations applicable to the 
     Organization as the Secretary determines to be necessary or 
     appropriate to ensure that the purposes specified in section 
     4 are accomplished.
                 TITLE IV--FORMATION OF NEW CORPORATION

     SEC. 401. FORMATION OF NEW CORPORATION.

       (a) In General.--In order to continue the accomplishment of 
     the purposes specified in section 3 beyond the terms of the 
     charter of the Organization, the Board shall, not later than 
     10 years after the date of enactment of this Act, cause the 
     formation of a new corporation under the laws of any tribe, 
     any State, or the District of Columbia.
       (b) Powers of New Corporation Not Prescribed.--Except as 
     provided in this section, the new corporation may have any 
     corporate powers and attributes permitted under the laws of 
     the jurisdiction of its incorporation which the Board shall 
     determine, in its business judgment, to be appropriate.
       (c) Use of NAFSO Name Prohibited.--The new corporation may 
     not use in any manner the name ``Native American Financial 
     Services Organization'' or ``NAFSO'' or any variation 
     thereof.

     SEC. 402. ADOPTION AND APPROVAL OF MERGER PLAN.

       (a) In General.--Not later than 10 years after the date of 
     enactment of this Act and after consultation with the Indian 
     tribes that are stockholders of class A stock referred to in 
     section 201(a), the Board shall prepare, adopt, and submit to 
     the Secretary for approval, a plan for merging the 
     Organization into the new corporation.
       (b) Designated Merger Date.--
       (1) In general.--The Board shall establish the designated 
     merger date in the merger plan as a specific calendar date on 
     which, and time of day at which, the merger of the 
     Organization into the new corporation shall take effect.
       (2) Changes.--The Board may change the designated merger 
     date in the merger plan by adopting an amended plan of 
     merger.
       (3) Restriction.--Except as provided in paragraph (4), the 
     designated merger date in the merger plan or any amended 
     merger plan shall not be later than 11 years after the date 
     of enactment of this Act.
       (4) Exception.--Subject to the restriction contained in 
     paragraph (5), the Board may adopt an amended plan of merger 
     that designates a date later than 11 years after the date of 
     enactment of this Act if the Board submits to the Secretary a 
     report--
       (A) stating that an orderly merger of the Organization into 
     the new corporation is not feasible before the latest date 
     designated by the Board;
       (B) explaining why an orderly merger of the Organization 
     into the new corporation is not feasible before the latest 
     date designated by the Board;
       (C) describing the steps that have been taken to consummate 
     an orderly merger of the Organization into the new 
     corporation not later than 11 years after the date of 
     enactment of this Act; and
       (D) describing the steps that will be taken to consummate 
     an orderly and timely merger of the Organization into the new 
     corporation.
       (5) Limitation.--The date designated by the Board in an 
     amended merger plan shall not be later than 12 years after 
     the date of enactment of this Act.
       (6) Consummation of merger.--The consummation of an orderly 
     and timely merger of the Organization into the new 
     corporation shall not occur later than 13 years after the 
     date of enactment of this Act.
       (c) Governmental Approvals of Merger Plan Required.--The 
     merger plan or any amended merger plan shall take effect on 
     the date on which the plan is approved by the Secretary.
       (d) Revision of Disapproved Merger Plan Required.--If the 
     Secretary disapproves the merger plan or any amended merger 
     plan--
       (1) the Secretary shall--
       (A) notify the Organization of such disapproval; and
       (B) indicate the reasons for the disapproval; and
       (2) not later than 30 days after the date of notification 
     of disapproval under paragraph (1), the Organization shall 
     submit to the Secretary for approval, an amended merger plan 
     responsive to the reasons for the disapproval indicated in 
     that notification.
       (e) No Stockholder Approval of Merger Plan Required.--The 
     approval or consent of the stockholders of the Organization 
     shall not be required to accomplish the merger of the 
     Organization into the new corporation.

     SEC. 403. CONSUMMATION OF MERGER.

       The Board shall ensure that the merger of the Organization 
     into the new corporation is accomplished in accordance with--
       (1) a merger plan approved by the Secretary under section 
     402; and
       (2) all applicable laws of the jurisdiction in which the 
     new corporation is incorporated.

     SEC. 404. TRANSITION.

       Except as provided in this section, the Organization shall, 
     during the transition period, continue to have all of the 
     rights, privileges, duties, and obligations, and shall be 
     subject to all of the limitations and restrictions, set forth 
     in this Act.

     SEC. 405. EFFECT OF MERGER.

       (a) Transfer of Assets and Liabilities.--On the designated 
     merger date, all property, real, personal, and mixed, all 
     debts due on any account, and any other interest, of or 
     belonging to or due to the Organization, shall be transferred 
     to and vested in the new corporation without further act or 
     deed, and title to any property, whether real, personal, or 
     mixed, shall not in any way be impaired by reason of the 
     merger.
       (b) Termination of the Organization and its Federal 
     Charter.--On the designated merger date--
       (1) the surviving corporation of the merger shall be the 
     new corporation;
       (2) the Federal charter of the Organization shall 
     terminate; and
       (3) the separate existence of the Organization shall 
     terminate.
       (c) References to the Organization in Law.--After the 
     designated merger date, any reference to the Organization in 
     any law or regulation shall be deemed to refer to the new 
     corporation.
       (d) Savings Clause.--
       (1) Proceedings.--The merger of the Organization into the 
     new corporation shall not abate any proceeding commenced by 
     or against the Organization before the designated merger 
     date, except that the new corporation shall be substituted 
     for the Organization as a party to any such proceeding as of 
     the designated merger date.
       (2) Contracts and agreements.--All contracts and agreements 
     to which the Organization is a party and which are in effect 
     on the day before the designated merger date shall continue 
     in effect according to their terms, except that the new 
     corporation shall be substituted for the Organization as a 
     party to those contracts and agreements as of the designated 
     merger date.
               TITLE V--AUTHORIZATIONS OF APPROPRIATIONS

     SEC. 501. AUTHORIZATION OF APPROPRIATIONS FOR NATIVE AMERICAN 
                   FINANCIAL INSTITUTIONS.

       (a) In General.--There are authorized to be appropriated to 
     the Fund, without fiscal year limitation, $20,000,000 to 
     provide financial assistance to Native American Financial 
     Institutions.
       (b) Not Matching Funds.--To the extent that a Native 
     American Financial Institution receives a portion of an 
     appropriation made under subsection (a), such funds shall not 
     be considered to be matching funds required of the Native 
     American Financial Institution under section 108(e) of the 
     Riegle Community Development and Regulatory Improvement Act 
     of 1994 (12 U.S.C. 4707(e)).

     SEC. 502. AUTHORIZATION OF APPROPRIATIONS FOR ORGANIZATION.

       The Secretary may, subject to the availability of 
     appropriations, provide not more than $10,000,000 for the 
     funding of a cooperative agreement to be entered into by the 
     Secretary and the Organization for technical assistance and 
     other services to be provided by the Organization to Native 
     American Financial Institutions.

                         ADDITIONAL COSPONSORS


                                 S. 102

  At the request of Mr. Breaux, the name of the Senator from Florida 
[Mr. Graham] was added as a cosponsor of S. 102, a bill to amend title 
XVIII of the Social Security Act to improve medicare treatment and 
education for beneficiaries with diabetes by providing coverage of 
diabetes outpatient self-management training services and uniform 
coverage of blood-testing strips for individuals with diabetes.


                                 S. 387

  At the request of Mr. Hatch, the name of the Senator from Michigan 
[Mr. Abraham] was added as a cosponsor of S. 387, a bill to amend the 
Internal Revenue Code of 1986 to provide equity to exports of software.


                                 S. 394

  At the request of Mr. Hatch, the name of the Senator from South 
Dakota [Mr. Daschle] was added as a cosponsor of S. 394, a bill to 
partially restore compensation levels to their past equivalent in terms 
of real income and establish the procedure for adjusting future 
compensation of justices and judges of the United States.


                                 S. 415

  At the request of Mr. Baucus, the name of the Senator from Iowa [Mr.

[[Page S5138]]

Harkin] was added as a cosponsor of S. 415, a bill to amend the 
medicare program under title XVIII of the Social Security Act to 
improve rural health services, and for other purposes.


                                 S. 428

  At the request of Mr. Kohl, the name of the Senator from New Jersey 
[Mr. Lautenberg] was added as a cosponsor of S. 428, a bill to amend 
chapter 44 of title 18, United States Code, to improve the safety of 
handguns.


                                 S. 567

  At the request of Mr. Smith, the name of the Senator from Arkansas 
[Mr. Hutchinson] was added as a cosponsor of S. 567, a bill to permit 
revocation by members of the clergy of their exemption from Social 
Security coverage.


                                 S. 623

  At the request of Mr. Inouye, the name of the Senator from California 
[Mrs. Feinstein] was added as a cosponsor of S. 623, a bill to amend 
title 38, United States Code, to deem certain service in the organized 
military forces of the Government of the Commonwealth of the Philipines 
and the Philippine Scouts to have been active service for purposes of 
benefits under programs administered by the Secretary of Veterans 
Affairs.


                                 S. 711

  At the request of Mr. Breaux, the names of the Senator from 
Massachusetts [Mr. Kerry] and the Senator from New Mexico [Mr. 
Domenici] were added as cosponsors of S. 711, a bill to amend the 
Internal Revenue Code of 1986 to simplify the method of payment of 
taxes on distilled spirits.


                                 S. 716

  At the request of Mr. Craig, the name of the Senator from Wyoming 
[Mr. Thomas] was added as a cosponsor of S. 716, a bill to establish a 
Joint United States-Canada Commission on Cattle and Beef to identify, 
and recommend means of resolving, national, regional, and provincial 
trade-distorting differences between the countries with respect to the 
production, processing, and sale of cattle and beef, and for other 
purposes.


                                 S. 732

  At the request of Mr. Faircloth, the names of the Senator from 
Arizona [Mr. Kyl], the Senator from Oklahoma [Mr. Nickles], the Senator 
from Utah [Mr. Hatch], the Senator from Tennessee [Mr. Thompson], the 
Senator from Rhode Island [Mr. Chafee], the Senator from Alaska [Mr. 
Stevens], and the Senator from Iowa [Mr. Grassley] were added as 
cosponsors of S. 732, a bill to require the Secretary of the Treasury 
to mint and issue coins in commemoration of the centennial anniversary 
of the first manned flight of Orville and Wilbur Wright in Kitty Hawk, 
North Carolina, on December 17, 1903.


                                 S. 755

  At the request of Mr. Campbell, the name of the Senator from New 
Hampshire [Mr. Gregg] was added as a cosponsor of S. 755, a bill to 
amend title 10, United States Code, to restore the provisions of 
chapter 76 of that title (relating to missing persons] as in effect 
before the amendments made by the National Defense Authorization Act 
for fiscal year 1997 and to make other improvements to that chapter.


                                 S. 797

  At the request of Mr. Chafee, the name of the Senator from 
Mississippi [Mr. Lott] was added as a cosponsor of S. 797, a bill to 
amend the John F. Kennedy Center Act to authorize the design and 
construction of additions to the parking garage and certain site 
improvements, and for other purposes.


                       Senate Joint Resolution 6

  At the request of Mrs. Feinstein, the name of the Senator from 
Connecticut [Mr. Lieberman] was added as a cosponsor of Senate Joint 
Resolution 6, a joint resolution proposing an amendment to the 
Constitution of the United States to protect the rights of crime 
victims.


                          Senate Resolution 57

  At the request of Mr. Dorgan, the name of the Senator from Tennessee 
[Mr. Thompson] was added as a cosponsor of Senate Resolution 57, a 
resolution to support the commemoration of the bicentennial of the 
Lewis and Clark Expedition.


                          Senate Resolution 82

  At the request of Mr. Bennett, the names of the Senator from Florida 
[Mr. Graham], the Senator from Tennessee [Mr. Thompson], the Senator 
from Ohio [Mr. DeWine], the Senator from Arkansas [Mr. Hutchinson], the 
Senator from Kentucky [Mr. McConnell], and the Senator from Oklahoma 
[Mr. Inhofe] were added as cosponsors of Senate Resolution 82, a 
resolution expressing the sense of the Senate to urge the Clinton 
administration to enforce the provisions of the Iran-Iraq Arms Non-
Proliferation Act of 1992 with respect to the acquisition by Iran of C-
802 cruise missiles.


                           Amendment No. 314

  At the request of Mr. Wellstone the name of the Senator from Illinois 
[Ms. Moseley-Braun] was added as a cosponsor of amendment No. 314 
proposed to Senate Concurrent Resolution 27, an original concurrent 
resolution setting forth the congressional budget for the U.S. 
Government for fiscal years 1998, 1999, 2000, 2001, and 2002.


                           Amendment No. 316

  At the request of Mr. Abraham the names of the Senator from North 
Carolina [Mr. Faircloth], the Senator from Colorado [Mr. Allard], and 
the Senator from Texas [Mrs. Hutchison] were added as cosponsors of 
amendment No. 316 proposed to Senate Concurrent Resolution 27, an 
original concurrent resolution setting forth the congressional budget 
for the U.S. Government for fiscal years 1998, 1999, 2000, 2001, and 
2002.

                          ____________________