[Congressional Record Volume 154, Number 105 (Tuesday, June 24, 2008)]
[Senate]
[Pages S6027-S6079]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                           TEXT OF AMENDMENTS

  SA 5030. Mr. ROBERTS (for himself and Mr. Brownback) submitted an 
amendment intended to be proposed to amendment SA 4983 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mr. Shelby)) to the bill H.R. 3221, 
moving the United States toward greater energy independence and 
security, developing innovative new technologies, reducing carbon 
emissions, creating green jobs, protecting consumers, increasing clean 
renewable energy production, and modernizing our energy infrastructure, 
and to amend the Internal Revenue Code of 1986 to provide tax 
incentives for the production of renewable energy and energy 
conservation; which was ordered to lie on the table; as follows:

       On page 615, between lines 2 and 3, insert the following:

     SEC. 3083. EXTENSION OF CERTAIN BONUS DEPRECIATION PLACED IN 
                   SERVICE REQUIREMENTS.

       Section 15345(d)(1) of Public Law 110-246 is amended--
         (1) by striking ``December 31, 2008'' in subparagraph (C) 
     and inserting ``December 31, 2010'', and
         (2) by striking ``December 31, 2009'' in subparagraph (D) 
     and inserting ``December 31, 2011''.
                                 ______
                                 
  SA 5031. Mr. DeMINT submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 133, strike line 10 and all that follows through 
     page 160, line 17.
                                 ______
                                 
  SA 5032. Mr. DeMINT submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       Beginning on page 615, line 4, strike all through page 623, 
     line 12.
                                 ______
                                 
  SA 5033. Mr. DeMINT submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 506, strike line 16 and all that follows through 
     page 518, line 3.
                                 ______
                                 
  SA 5034. Mr. DeMINT submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 414, strike line 24 and all that follows through 
     page 415, line 3.
                                 ______
                                 
  SA 5035. Mr. GRASSLEY (for himself, Mr. Harkin, Mr. Durbin, Mr. 
Coleman, Mrs. McCaskill, Mr. Bond, Mr. Lugar, Mr. Bayh, Ms. Klobuchar, 
and Mr. Obama) submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3211, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       At the end of subtitle A of title III of division C, insert 
     the following:

     SEC. ___. TEMPORARY TAX RELIEF FOR AREAS DAMAGED BY 2008 
                   MIDWESTERN SEVERE STORMS, TORNADOS, AND 
                   FLOODING.

       (a) In General.--Subject to the modifications described in 
     this section, the following provisions of or relating to the 
     Internal Revenue Code of 1986 shall apply to any Midwestern 
     disaster area in addition to the areas to which such 
     provisions otherwise apply:
       (1) Go zone benefits.--
       (A) Section 1400N (relating to tax benefits) other than 
     subsections (b), (i), and (j) thereof.
       (B) Section 1400O (relating to education tax benefits).
       (C) Section 1400P (relating to housing tax benefits).
       (D) Section 1400Q (relating to special rules for use of 
     retirement funds).
       (E) Section 1400R(a) (relating to employee retention credit 
     for employers).
       (F) Section 1400S (relating to additional tax relief) other 
     than subsection (d) thereof.
       (G) Section 1400T (relating to special rules for mortgage 
     revenue bonds).
       (2) Other benefits included in katrina emergency tax relief 
     act of 2005.--Sections 302, 303, 304, 401, and 405 of the 
     Katrina Emergency Tax Relief Act of 2005.
       (3) Other benefits.--Section 3082(a) of this Act (relating 
     to use of amended income tax returns to take into account 
     receipt of certain casualty loss grants by disallowing 
     previously taken casualty loss deductions).
       (b) Midwestern Disaster Area.--
       (1) In general.--For purposes of this section and for 
     applying the substitutions described in subsections (d) and 
     (e), the term ``Midwestern disaster area'' means an area--
       (A) with respect to which a major disaster has been 
     declared by the President after May 20, 2008, and before 
     August 1, 2008, under section 401 of the Robert T. Stafford 
     Disaster Relief and Emergency Assistance Act by reason of 
     severe storms, tornados, or flooding occurring in any of the 
     States of Arkansas, Illinois, Indiana, Iowa, Kansas, 
     Michigan, Minnesota, Missouri, and Wisconsin, and
       (B) determined by the President to warrant individual or 
     individual and public assistance from the Federal Government 
     under such Act with respect to damages attributable to such 
     severe storms, tornados, or flooding.
       (2) Certain benefits available to areas eligible only for 
     public assistance.--For purposes of applying this section to 
     benefits under the following provisions, paragraph (1) shall 
     be applied without regard to subparagraph (B):
       (A) Sections 1400Q, 1400S(b), and 1400S(d) of the Internal 
     Revenue Code of 1986.
       (B) Sections 302, 401, and 405 of the Katrina Emergency Tax 
     Relief Act of 2005.
       (c) References.--
       (1) Area.--Any reference in such provisions to the 
     Hurricane Katrina disaster area or the Gulf Opportunity Zone 
     shall be treated as a reference to any Midwestern disaster 
     area and any reference to the Hurricane Katrina disaster area 
     or the Gulf Opportunity Zone within a State shall be treated 
     as a reference to all Midwestern disaster areas within the 
     State.

[[Page S6028]]

       (2) Items attributable to disaster.--Any reference in such 
     provisions to any loss, damage, or other item attributable to 
     Hurricane Katrina shall be treated as a reference to any 
     loss, damage, or other item attributable to the severe 
     storms, tornados, or flooding giving rise to any Presidential 
     declaration described in subsection (b)(1)(A).
       (3) Applicable disaster date.--For purposes of applying the 
     substitutions described in subsections (d) and (e), the term 
     ``applicable disaster date'' means, with respect to any 
     Midwestern disaster area, the date on which the severe 
     storms, tornados, or flooding giving rise to the Presidential 
     declaration described in subsection (b)(1)(A) occurred.
       (d) Modifications to 1986 Code.--The following provisions 
     of the Internal Revenue Code of 1986 shall be applied with 
     the following modifications:
       (1) Tax-exempt bond financing.--Section 1400N(a)--
       (A) by substituting ``qualified Midwestern disaster area 
     bond'' for ``qualified Gulf Opportunity Zone Bond'' each 
     place it appears,
       (B) by substituting ``any State in which a Midwestern 
     disaster area is located'' for ``the State of Alabama, 
     Louisiana, or Mississippi'' in paragraph (2)(B),
       (C) by substituting ``designated for purposes of this 
     section (on the basis of providing assistance to areas in the 
     order in which such assistance is most needed)'' for 
     ``designated for purposes of this section'' in paragraph 
     (2)(C),
       (D) by substituting ``January 1, 2013'' for ``January 1, 
     2011'' in paragraph (2)(D),
       (E) in paragraph (3)(A)--
       (i) by substituting ``$5,000'' for ``$2,500'', and
       (ii) by substituting ``before the earliest applicable 
     disaster date for Midwestern disaster areas within the 
     State'' for ``before August 28, 2005'',
       (F) by substituting ``qualified Midwestern disaster area 
     repair or construction'' for ``qualified GO Zone repair or 
     construction'' each place it appears, and
       (G) by substituting ``after the date of the enactment of 
     the Housing and Economic Recovery Act of 2008 and before 
     January 1, 2013'' for ``after the date of the enactment of 
     this paragraph and before January 1, 2011'' in paragraph 
     (7)(C).
       (2) Low-income housing credit.--Section 1400N(c)--
       (A) only with respect to calendar years 2009, 2010, and 
     2011,
       (B) by substituting ``Disaster Recovery Assistance housing 
     amount'' for ``Gulf Opportunity housing amount'',
       (C) by substituting ``before the earliest applicable 
     disaster date for Midwestern disaster areas within the 
     State'' for ``before August 28, 2005'' in paragraph (1)(B), 
     and
       (D) determined without regard to paragraphs (2), (3), (4), 
     (5), and (6) thereof.
       (3) Special allowance for certain property acquired on or 
     after the applicable disaster date.--Section 1400N(d)--
       (A) by substituting ``qualified Disaster Recovery 
     Assistance property'' for ``qualified Gulf Opportunity Zone 
     property'' each place it appears,
       (B) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' each place it appears,
       (C) by substituting ``December 31, 2011'' for ``December 
     31, 2007'' in paragraph (2)(A)(v),
       (D) by substituting ``December 31, 2012'' for ``December 
     31, 2008'' in paragraph (2)(A)(v),
       (E) by substituting ``the day before the applicable 
     disaster date'' for ``August 27, 2005'' in paragraph (3)(A), 
     and
       (F) determined without regard to paragraph (6) thereof.
       (4) Increase in expensing under section 179.--Section 
     1400N(e), by substituting ``qualified section 179 Disaster 
     Recovery Assistance property'' for ``qualified section 179 
     Gulf Opportunity Zone property'' each place it appears.
       (5) Expensing for certain demolition and clean-up costs.--
     Section 1400N(f)--
       (A) by substituting ``qualified Disaster Recovery 
     Assistance clean-up cost'' for ``qualified Gulf Opportunity 
     Zone clean-up cost'' each place it appears, and
       (B) by substituting ``beginning on the applicable disaster 
     date and ending on December 31, 2010'' for ``beginning on 
     August 28, 2005, and ending on December 31, 2007'' in 
     paragraph (2).
       (6) Extension of expensing for environmental remediation 
     costs.--Section 1400N(g)--
       (A) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' each place it appears,
       (B) by substituting ``January 1, 2011'' for ``January 1, 
     2008'' in paragraph (1), and
       (C) by substituting ``December 31, 2010'' for ``December 
     31, 2007''.
       (7) Increase in rehabilitation credit.--Section 1400N(h)--
       (A) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'', and
       (B) by substituting ``January 1, 2011'' for ``January 1, 
     2008'' in paragraph (1).
       (8) Treatment of net operating losses attributable to 
     disaster losses.--Section 1400N(k)--
       (A) by substituting ``qualified Disaster Recovery 
     Assistance loss'' for ``qualified Gulf Opportunity Zone 
     loss'' each place it appears,
       (B) by substituting ``after the day before the applicable 
     disaster date, and before January 1, 2011'' for ``after 
     August 27, 2005, and before January 1, 2008'' each place it 
     appears,
       (C) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' in paragraph (2)(B)(ii)(I),
       (D) by substituting ``qualified Disaster Recovery 
     Assistance property'' for ``qualified Gulf Opportunity Zone 
     property'' in paragraph (2)(B)(iv), and
       (E) by substituting ``qualified Disaster Recovery 
     Assistance casualty loss'' for ``qualified Gulf Opportunity 
     Zone casualty loss'' each place it appears.
       (9) Credit to holders of tax credit bonds.--Section 
     1400N(l)--
       (A) by substituting ``Midwestern tax credit bond'' for 
     ``Gulf tax credit bond'' each place it appears,
       (B) by substituting ``any State in which a Midwestern 
     disaster area is located'' for ``the State of Alabama, 
     Louisiana, or Mississippi'' in paragraph (4)(A)(i),
       (C) by substituting ``after December 31, 2008 and before 
     January 1, 2010'' for ``after December 31, 2005, and before 
     January 1, 2007'',
       (D) by substituting ``shall not exceed $100,000,000.'' for 
     ``shall not exceed'' and all that follows in paragraph 
     (4)(C), and
       (E) by substituting ``the earliest applicable disaster date 
     for Midwestern disaster areas within the State'' for ``August 
     28, 2005'' in paragraph (5)(A).
       (10) New markets tax credit.--Section 1400N(m)--
       (A) by substituting ``$300,000,000 for 2009 and 2010'' for 
     ``$300,000,000 for 2005 and 2006'' in paragraph (2)(A), and
       (B) by substituting ``$400,000,000 for 2011'' for 
     ``$400,000,000 for 2007'' in paragraph (2)(B).
       (11) Education tax benefits.--Section 1400O, by 
     substituting ``2008 or 2009'' for ``2005 or 2006''.
       (12) Housing tax benefits.--Section 1400P, by substituting 
     ``the applicable disaster date'' for ``August 28, 2005'' in 
     subsection (c)(1).
       (13) Special rules for use of retirement funds.--Section 
     1400Q--
       (A) by substituting ``qualified Disaster Recovery 
     Assistance distribution'' for ``qualified hurricane 
     distribution'' each place it appears,
       (B) by substituting ``on or after the applicable disaster 
     date and before January 1, 2010'' for ``on or after August 
     25, 2005, and before January 1, 2007'' in subsection 
     (a)(4)(A)(i),
       (C) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' in subsections (a)(4)(A)(i) and 
     (c)(3)(B),
       (D) by disregarding clauses (ii) and (iii) of subsection 
     (a)(4)(A) thereof,
       (E) by substituting ``qualified storm damage distribution'' 
     for ``qualified Katrina distribution'' each place it appears,
       (F) by substituting ``after the date which is 6 months 
     before the applicable disaster date and before the date which 
     is the day after the applicable disaster date'' for ``after 
     February 28, 2005, and before August 29, 2005'' in subsection 
     (b)(2)(B)(ii),
       (G) by substituting ``the Midwestern disaster area, but not 
     so purchased or constructed on account of severe storms, 
     tornados, or flooding giving rise to the designation of the 
     area as a disaster area'' for ``the Hurricane Katrina 
     disaster area, but not so purchased or constructed on account 
     of Hurricane Katrina'' in subsection (b)(2)(B)(iii),
       (H) by substituting ``beginning on the applicable disaster 
     date and ending on the date which is 5 months after the date 
     of the enactment of the Housing and Economic Recovery Act of 
     2008'' for ``beginning on August 25, 2005, and ending on 
     February 28, 2006'' in subsection (b)(3)(A),
       (I) by substituting ``qualified storm damage individual'' 
     for ``qualified Hurricane Katrina individual'' each place it 
     appears,
       (J) by substituting ``December 31, 2009'' for ``December 
     31, 2006'' in subsection (c)(2)(A),
       (K) by substituting ``beginning on the date of the 
     enactment of the Housing and Economic Recovery Act of 2008 
     and ending on December 31, 2009'' for ``beginning on 
     September 24, 2005, and ending on December 31, 2006'' in 
     subsection (c)(4)(A)(i),
       (L) by substituting ``the applicable disaster date'' for 
     ``August 25, 2005'' in subsection (c)(4)(A)(ii), and
       (M) by substituting ``January 1, 2010'' for ``January 1, 
     2007'' in subsection (d)(2)(A)(ii).
       (14) Employee retention credit for employers affected by 
     severe storms, tornados, and flooding.--Section 1400R(a)--
       (A) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' each place it appears,
       (B) by substituting ``January 1, 2009'' for ``January 1, 
     2006'' both places it appears, and
       (C) only with respect to eligible employers who employed an 
     average of not more than 200 employees on business days 
     during the taxable year before the applicable disaster date.
       (15) Temporary suspension of limitations on charitable 
     contributions.--Section 1400S(a), by substituting the 
     following paragraph for paragraph (4) thereof:
       ``(4) Qualified contributions.--
       ``(A) In general.--For purposes of this subsection, the 
     term `qualified contribution' means any charitable 
     contribution (as defined in section 170(c)) if--
       ``(i) such contribution--

       ``(I) is paid during the period beginning on the earliest 
     applicable disaster date for all States and ending on 
     December 31, 2008, in cash to an organization described in 
     section 170(b)(1)(A), and
       ``(II) is made for relief efforts in 1 or more Midwestern 
     disaster areas,

[[Page S6029]]

       ``(ii) the taxpayer obtains from such organization 
     contemporaneous written acknowledgment (within the meaning of 
     section 170(f)(8)) that such contribution was used (or is to 
     be used) for relief efforts in 1 or more Midwestern disaster 
     areas, and
       ``(iii) the taxpayer has elected the application of this 
     subsection with respect to such contribution.
       ``(B) Exception.--Such term shall not include a 
     contribution by a donor if the contribution is--
       ``(i) to an organization described in section 509(a)(3), or
       ``(ii) for establishment of a new, or maintenance of an 
     existing, donor advised fund (as defined in section 
     4966(d)(2)).
       ``(C) Application of election to partnerships and s 
     corporations.--In the case of a partnership or S corporation, 
     the election under subparagraph (A)(iii) shall be made 
     separately by each partner or shareholder.''.
       (16) Suspension of certain limitations on personal casualty 
     losses.--Section 1400S(b)(1), by substituting ``the 
     applicable disaster date'' for ``August 25, 2005''.
       (17) Special rule for determining earned income.--Section 
     1400S(d)--
       (A) by treating an individual as a qualified individual if 
     such individual's principal place of abode on the applicable 
     disaster date was located in a Midwestern disaster area,
       (B) by treating the applicable disaster date with respect 
     to any such individual as the applicable date for purposes of 
     such subsection, and
       (C) by treating an area as described in paragraph 
     (2)(B)(ii) thereof if the area is a Midwestern disaster area 
     only by reason of subsection (b)(2) of this section (relating 
     to areas eligible only for public assistance)
       (18) Adjustments regarding taxpayer and dependency 
     status.--Section 1400S(e), by substituting ``2008 or 2009'' 
     for ``2005 or 2006''.
       (e) Modifications to Katrina Emergency Tax Relief Act of 
     2005.--The following provisions of the Katrina Emergency Tax 
     Relief Act of 2005 shall be applied with the following 
     modifications:
       (1) Additional exemption for housing displaced 
     individual.--Section 302--
       (A) by substituting ``Midwestern displaced individual'' for 
     ``Hurricane Katrina displaced individual'' each place it 
     appears, and
       (B) by treating an area as a core disaster area for 
     purposes of applying subsection (c) thereof if the area is a 
     Midwestern disaster area without regard to subsection (b)(2) 
     of this section (relating to areas eligible only for public 
     assistance).
       (2) Increase in standard mileage rate.--Section 303, by 
     substituting ``beginning on the applicable disaster date and 
     ending on December 31, 2009'' for ``beginning on August 25, 
     2005, and ending on December 31, 2006''.
       (3) Mileage reimbursements for charitable volunteers.--
     Section 304--
       (A) by substituting ``beginning on the applicable disaster 
     date and ending on December 31, 2009'' for ``beginning on 
     August 25, 2005, and ending on December 31, 2006'' in 
     subsection (a), and
       (B) by substituting ``the applicable disaster date'' for 
     ``August 25, 2005'' in subsection (a).
       (4) Exclusion of certain cancellation of indebtedness 
     income.--Section 401--
       (A) by treating an individual whose principal place of 
     abode on the applicable disaster date was in a Midwestern 
     disaster area (determined without regard to subsection (b)(2) 
     of this section) as an individual described in subsection 
     (b)(1) thereof, and by treating an individual whose principal 
     place of abode on the applicable disaster date was in a 
     Midwestern disaster area solely by reason of subsection 
     (b)(2) of this section as an individual described in 
     subsection (b)(2) thereof,
       (B) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' both places it appears, and
       (C) by substituting ``January 1, 2010'' for ``January 1, 
     2007'' in subsection (e).
       (5) Extension of replacement period for nonrecognition of 
     gain.--Section 405, by substituting ``on or after the 
     applicable disaster date'' for ``on or after August 25, 
     2005''.

     SEC. ___. ENHANCED CHARITABLE DEDUCTIONS FOR CONTRIBUTIONS OF 
                   FOOD INVENTORY.

       (a) Increased Amount of Deduction.--
       (1) In general.--Clause (iv) of section 170(e)(3)(C) 
     (relating to termination) of the Internal Revenue Code of 
     1986 is amended by striking ``December 31, 2007'' and 
     inserting ``December 31, 2009''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply to contributions made after December 31, 2007.
       (b) Temporary Suspension of Limitations on Charitable 
     Contributions.--
       (1) In general.--Section 170(b) of such Code is amended by 
     adding at the end the following new paragraph:
       ``(3) Temporary suspension of limitations on charitable 
     contributions.--In the case of a qualified farmer or rancher 
     (as defined in paragraph (1)(E)(v)), any charitable 
     contribution of food--
       ``(A) to which subsection (e)(3)(C) applies (without regard 
     to clause (ii) thereof), and
       ``(B) which is made during the period beginning on the date 
     of the enactment of this paragraph and before January 1, 
     2009,
     shall be treated for purposes of paragraph (1)(E) or (2)(B), 
     whichever is applicable, as if it were a qualified 
     conservation contribution which is made by a qualified farmer 
     or rancher and which otherwise meets the requirements of such 
     paragraph.''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. ___. EXTENSION OF ENHANCED CHARITABLE DEDUCTION FOR 
                   CONTRIBUTIONS OF BOOK INVENTORY.

       (a) Extension.--Clause (iv) of section 170(e)(3)(D) of the 
     Internal Revenue Code of 1986 (relating to termination) of 
     the Internal Revenue Code of 1986 is amended by striking 
     ``December 31, 2007'' and inserting ``December 31, 2009''.
       (b) Clerical Amendment.--Clause (iii) of section 
     170(e)(3)(D) of such Code (relating to certification by 
     donee) is amended by inserting ``of books'' after ``to any 
     contribution''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to contributions made after December 31, 2007.

     SEC. ___. REPORTING REQUIREMENTS RELATING TO DISASTER RELIEF 
                   CONTRIBUTIONS.

       (a) In General.--Section 6033(b) of the Internal Revenue 
     Code of 1986 (relating to returns of certain organizations 
     described in section 501(c)(3)) is amended by striking 
     ``and'' at the end of paragraph (13), by redesignating 
     paragraph (14) as paragraph (15), and by adding after 
     paragraph (13) the following new paragraph:
       ``(14) such information as the Secretary may require with 
     respect to disaster relief activities, including the amount 
     and use of qualified contributions to which section 1400S(a) 
     applies, and''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to returns the due date for which (determined 
     without regard to any extension) occurs after December 31, 
     2008.
                                 ______
                                 
  SA 5036. Mr. COBURN submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       At the appropriate place, insert the following:

     SEC. ____. PROTECTION OF TAXPAYERS.

       Notwithstanding any other provision of this Act, title III 
     of Division B of this Act shall not take effect.
                                 ______
                                 
  SA 5037. Mr. BAYH (for himself, Mr. Nelson of Nebraska, and Ms. 
Klobuchar) submitted an amendment intended to be proposed to amendment 
SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and Mr. 
Shelby)) to the bill H.R. 3221, moving the United States toward greater 
energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       Beginning on page 573, line 12, strike through page 574, 
     line 14, and insert the following:
       ``(8) Real property tax deduction.--For purposes of 
     paragraph (1), the real property tax deduction is the lesser 
     of--
       ``(A) the amount allowable as a deduction under this 
     chapter for State and local taxes described in section 
     164(a)(1), or
       ``(B) $500 ($1,000 in the case of a joint return).

     Any taxes taken into account under section 62(a) shall not be 
     taken into account under this paragraph.''.
                                 ______
                                 
  SA 5038. Mrs. LINCOLN (for herself and Mr. Pryor) submitted an 
amendment intended to be proposed to amendment SA 4983 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mr. Shelby)) to the bill H.R. 3221, 
moving the United States toward greater energy independence and 
security, developing innovative new technologies, reducing carbon 
emissions, creating green jobs, protecting consumers, increasing clean 
renewable energy production, and modernizing our energy infrastructure, 
and to amend the Internal Revenue Code of 1986 to provide tax 
incentives for the production of renewable energy and energy 
conservation; which was ordered to lie on the table; as follows:

       At the end of subtitle A of title III of division C, insert 
     the following:

[[Page S6030]]

     SEC. ___. TEMPORARY TAX RELIEF FOR AREAS DAMAGED BY 2008 
                   MIDWESTERN SEVERE STORMS, TORNADOS, AND 
                   FLOODING.

       (a) In General.--Subject to the modifications described in 
     this section, the following provisions of or relating to the 
     Internal Revenue Code of 1986 shall apply to any Midwestern 
     disaster area in addition to the areas to which such 
     provisions otherwise apply:
       (1) Go zone benefits.--
       (A) Section 1400N (relating to tax benefits) other than 
     subsections (b), (i), and (j) thereof.
       (B) Section 1400O (relating to education tax benefits).
       (C) Section 1400P (relating to housing tax benefits).
       (D) Section 1400Q (relating to special rules for use of 
     retirement funds).
       (E) Section 1400R(a) (relating to employee retention credit 
     for employers).
       (F) Section 1400S (relating to additional tax relief) other 
     than subsection (d) thereof.
       (G) Section 1400T (relating to special rules for mortgage 
     revenue bonds).
       (2) Other benefits included in katrina emergency tax relief 
     act of 2005.--Sections 302, 303, 304, 401, and 405 of the 
     Katrina Emergency Tax Relief Act of 2005.
       (3) Other benefits.--Section 3082(a) of this Act (relating 
     to use of amended income tax returns to take into account 
     receipt of certain casualty loss grants by disallowing 
     previously taken casualty loss deductions).
       (b) Midwestern Disaster Area.--
       (1) In general.--For purposes of this section and for 
     applying the substitutions described in subsections (d) and 
     (e), the term ``Midwestern disaster area'' means an area--
       (A) with respect to which a major disaster has been 
     declared by the President after May 20, 2008, and before 
     August 1, 2008, under section 401 of the Robert T. Stafford 
     Disaster Relief and Emergency Assistance Act by reason of 
     severe storms, tornados, or flooding occurring in any of the 
     States of Arkansas, Illinois, Indiana, Iowa, Kansas, 
     Michigan, Minnesota, Missouri, and Wisconsin, and
       (B) determined by the President to warrant individual or 
     individual and public assistance from the Federal Government 
     under such Act with respect to damages attributable to such 
     severe storms, tornados, or flooding.

     In the case of a State with respect to which the President 
     during the period beginning on January 1, 2008, and ending on 
     July 31, 2008, has declared major disasters under such Act 
     with respect to at least 75 percent of the counties of such 
     State, subparagraph (A) shall be applied by substituting 
     ``December 31, 2007'' for ``May 20, 2008''.
       (2) Certain benefits available to areas eligible only for 
     public assistance.--For purposes of applying this section to 
     benefits under the following provisions, paragraph (1) shall 
     be applied without regard to subparagraph (B):
       (A) Sections 1400Q, 1400S(b), and 1400S(d) of the Internal 
     Revenue Code of 1986.
       (B) Sections 302, 401, and 405 of the Katrina Emergency Tax 
     Relief Act of 2005.
       (c) References.--
       (1) Area.--Any reference in such provisions to the 
     Hurricane Katrina disaster area or the Gulf Opportunity Zone 
     shall be treated as a reference to any Midwestern disaster 
     area and any reference to the Hurricane Katrina disaster area 
     or the Gulf Opportunity Zone within a State shall be treated 
     as a reference to all Midwestern disaster areas within the 
     State.
       (2) Items attributable to disaster.--Any reference in such 
     provisions to any loss, damage, or other item attributable to 
     Hurricane Katrina shall be treated as a reference to any 
     loss, damage, or other item attributable to the severe 
     storms, tornados, or flooding giving rise to any Presidential 
     declaration described in subsection (b)(1)(A).
       (3) Applicable disaster date.--For purposes of applying the 
     substitutions described in subsections (d) and (e), the term 
     ``applicable disaster date'' means, with respect to any 
     Midwestern disaster area, the date on which the severe 
     storms, tornados, or flooding giving rise to the Presidential 
     declaration described in subsection (b)(1)(A) occurred.
       (d) Modifications to 1986 Code.--The following provisions 
     of the Internal Revenue Code of 1986 shall be applied with 
     the following modifications:
       (1) Tax-exempt bond financing.--Section 1400N(a)--
       (A) by substituting ``qualified Midwestern disaster area 
     bond'' for ``qualified Gulf Opportunity Zone Bond'' each 
     place it appears,
       (B) by substituting ``any State in which a Midwestern 
     disaster area is located'' for ``the State of Alabama, 
     Louisiana, or Mississippi'' in paragraph (2)(B),
       (C) by substituting ``designated for purposes of this 
     section (on the basis of providing assistance to areas in the 
     order in which such assistance is most needed)'' for 
     ``designated for purposes of this section'' in paragraph 
     (2)(C),
       (D) by substituting ``January 1, 2013'' for ``January 1, 
     2011'' in paragraph (2)(D),
       (E) in paragraph (3)(A)--
       (i) by substituting ``$5,000'' for ``$2,500'', and
       (ii) by substituting ``before the earliest applicable 
     disaster date for Midwestern disaster areas within the 
     State'' for ``before August 28, 2005'',
       (F) by substituting ``qualified Midwestern disaster area 
     repair or construction'' for ``qualified GO Zone repair or 
     construction'' each place it appears, and
       (G) by substituting ``after the date of the enactment of 
     the Housing and Economic Recovery Act of 2008 and before 
     January 1, 2013'' for ``after the date of the enactment of 
     this paragraph and before January 1, 2011'' in paragraph 
     (7)(C).
       (2) Low-income housing credit.--Section 1400N(c)--
       (A) only with respect to calendar years 2009, 2010, and 
     2011,
       (B) by substituting ``Disaster Recovery Assistance housing 
     amount'' for ``Gulf Opportunity housing amount'',
       (C) by substituting ``before the earliest applicable 
     disaster date for Midwestern disaster areas within the 
     State'' for ``before August 28, 2005'' in paragraph (1)(B), 
     and
       (D) determined without regard to paragraphs (2), (3), (4), 
     (5), and (6) thereof.
       (3) Special allowance for certain property acquired on or 
     after the applicable disaster date.--Section 1400N(d)--
       (A) by substituting ``qualified Disaster Recovery 
     Assistance property'' for ``qualified Gulf Opportunity Zone 
     property'' each place it appears,
       (B) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' each place it appears,
       (C) by substituting ``December 31, 2011'' for ``December 
     31, 2007'' in paragraph (2)(A)(v),
       (D) by substituting ``December 31, 2012'' for ``December 
     31, 2008'' in paragraph (2)(A)(v),
       (E) by substituting ``the day before the applicable 
     disaster date'' for ``August 27, 2005'' in paragraph (3)(A), 
     and
       (F) determined without regard to paragraph (6) thereof.
       (4) Increase in expensing under section 179.--Section 
     1400N(e), by substituting ``qualified section 179 Disaster 
     Recovery Assistance property'' for ``qualified section 179 
     Gulf Opportunity Zone property'' each place it appears.
       (5) Expensing for certain demolition and clean-up costs.--
     Section 1400N(f)--
       (A) by substituting ``qualified Disaster Recovery 
     Assistance clean-up cost'' for ``qualified Gulf Opportunity 
     Zone clean-up cost'' each place it appears, and
       (B) by substituting ``beginning on the applicable disaster 
     date and ending on December 31, 2010'' for ``beginning on 
     August 28, 2005, and ending on December 31, 2007'' in 
     paragraph (2).
       (6) Extension of expensing for environmental remediation 
     costs.--Section 1400N(g)--
       (A) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' each place it appears,
       (B) by substituting ``January 1, 2011'' for ``January 1, 
     2008'' in paragraph (1), and
       (C) by substituting ``December 31, 2010'' for ``December 
     31, 2007''.
       (7) Increase in rehabilitation credit.--Section 1400N(h)--
       (A) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'', and
       (B) by substituting ``January 1, 2011'' for ``January 1, 
     2008'' in paragraph (1).
       (8) Treatment of net operating losses attributable to 
     disaster losses.--Section 1400N(k)--
       (A) by substituting ``qualified Disaster Recovery 
     Assistance loss'' for ``qualified Gulf Opportunity Zone 
     loss'' each place it appears,
       (B) by substituting ``after the day before the applicable 
     disaster date, and before January 1, 2011'' for ``after 
     August 27, 2005, and before January 1, 2008'' each place it 
     appears,
       (C) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' in paragraph (2)(B)(ii)(I),
       (D) by substituting ``qualified Disaster Recovery 
     Assistance property'' for ``qualified Gulf Opportunity Zone 
     property'' in paragraph (2)(B)(iv), and
       (E) by substituting ``qualified Disaster Recovery 
     Assistance casualty loss'' for ``qualified Gulf Opportunity 
     Zone casualty loss'' each place it appears.
       (9) Credit to holders of tax credit bonds.--Section 
     1400N(l)--
       (A) by substituting ``Midwestern tax credit bond'' for 
     ``Gulf tax credit bond'' each place it appears,
       (B) by substituting ``any State in which a Midwestern 
     disaster area is located'' for ``the State of Alabama, 
     Louisiana, or Mississippi'' in paragraph (4)(A)(i),
       (C) by substituting ``after December 31, 2008 and before 
     January 1, 2010'' for ``after December 31, 2005, and before 
     January 1, 2007'',
       (D) by substituting ``shall not exceed $100,000,000.'' for 
     ``shall not exceed'' and all that follows in paragraph 
     (4)(C), and
       (E) by substituting ``the earliest applicable disaster date 
     for Midwestern disaster areas within the State'' for ``August 
     28, 2005'' in paragraph (5)(A).
       (10) New markets tax credit.--Section 1400N(m)--
       (A) by substituting ``$300,000,000 for 2009 and 2010'' for 
     ``$300,000,000 for 2005 and 2006'' in paragraph (2)(A), and
       (B) by substituting ``$400,000,000 for 2011'' for 
     ``$400,000,000 for 2007'' in paragraph (2)(B).
       (11) Education tax benefits.--Section 1400O, by 
     substituting ``2008 or 2009'' for ``2005 or 2006''.
       (12) Housing tax benefits.--Section 1400P, by substituting 
     ``the applicable disaster date'' for ``August 28, 2005'' in 
     subsection (c)(1).
       (13) Special rules for use of retirement funds.--Section 
     1400Q--

[[Page S6031]]

       (A) by substituting ``qualified Disaster Recovery 
     Assistance distribution'' for ``qualified hurricane 
     distribution'' each place it appears,
       (B) by substituting ``on or after the applicable disaster 
     date and before January 1, 2010'' for ``on or after August 
     25, 2005, and before January 1, 2007'' in subsection 
     (a)(4)(A)(i),
       (C) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' in subsections (a)(4)(A)(i) and 
     (c)(3)(B),
       (D) by disregarding clauses (ii) and (iii) of subsection 
     (a)(4)(A) thereof,
       (E) by substituting ``qualified storm damage distribution'' 
     for ``qualified Katrina distribution'' each place it appears,
       (F) by substituting ``after the date which is 6 months 
     before the applicable disaster date and before the date which 
     is the day after the applicable disaster date'' for ``after 
     February 28, 2005, and before August 29, 2005'' in subsection 
     (b)(2)(B)(ii),
       (G) by substituting ``the Midwestern disaster area, but not 
     so purchased or constructed on account of severe storms, 
     tornados, or flooding giving rise to the designation of the 
     area as a disaster area'' for ``the Hurricane Katrina 
     disaster area, but not so purchased or constructed on account 
     of Hurricane Katrina'' in subsection (b)(2)(B)(iii),
       (H) by substituting ``beginning on the applicable disaster 
     date and ending on the date which is 5 months after the date 
     of the enactment of the Housing and Economic Recovery Act of 
     2008'' for ``beginning on August 25, 2005, and ending on 
     February 28, 2006'' in subsection (b)(3)(A),
       (I) by substituting ``qualified storm damage individual'' 
     for ``qualified Hurricane Katrina individual'' each place it 
     appears,
       (J) by substituting ``December 31, 2009'' for ``December 
     31, 2006'' in subsection (c)(2)(A),
       (K) by substituting ``beginning on the date of the 
     enactment of the Housing and Economic Recovery Act of 2008 
     and ending on December 31, 2009'' for ``beginning on 
     September 24, 2005, and ending on December 31, 2006'' in 
     subsection (c)(4)(A)(i),
       (L) by substituting ``the applicable disaster date'' for 
     ``August 25, 2005'' in subsection (c)(4)(A)(ii), and
       (M) by substituting ``January 1, 2010'' for ``January 1, 
     2007'' in subsection (d)(2)(A)(ii).
       (14) Employee retention credit for employers affected by 
     severe storms, tornados, and flooding.--Section 1400R(a)--
       (A) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' each place it appears,
       (B) by substituting ``January 1, 2009'' for ``January 1, 
     2006'' both places it appears, and
       (C) only with respect to eligible employers who employed an 
     average of not more than 200 employees on business days 
     during the taxable year before the applicable disaster date.
       (15) Temporary suspension of limitations on charitable 
     contributions.--Section 1400S(a), by substituting the 
     following paragraph for paragraph (4) thereof:
       ``(4) Qualified contributions.--
       ``(A) In general.--For purposes of this subsection, the 
     term `qualified contribution' means any charitable 
     contribution (as defined in section 170(c)) if--
       ``(i) such contribution--

       ``(I) is paid during the period beginning on the earliest 
     applicable disaster date for all States and ending on 
     December 31, 2008, in cash to an organization described in 
     section 170(b)(1)(A), and
       ``(II) is made for relief efforts in 1 or more Midwestern 
     disaster areas,

       ``(ii) the taxpayer obtains from such organization 
     contemporaneous written acknowledgment (within the meaning of 
     section 170(f)(8)) that such contribution was used (or is to 
     be used) for relief efforts in 1 or more Midwestern disaster 
     areas, and
       ``(iii) the taxpayer has elected the application of this 
     subsection with respect to such contribution.
       ``(B) Exception.--Such term shall not include a 
     contribution by a donor if the contribution is--
       ``(i) to an organization described in section 509(a)(3), or
       ``(ii) for establishment of a new, or maintenance of an 
     existing, donor advised fund (as defined in section 
     4966(d)(2)).
       ``(C) Application of election to partnerships and s 
     corporations.--In the case of a partnership or S corporation, 
     the election under subparagraph (A)(iii) shall be made 
     separately by each partner or shareholder.''.
       (16) Suspension of certain limitations on personal casualty 
     losses.--Section 1400S(b)(1), by substituting ``the 
     applicable disaster date'' for ``August 25, 2005''.
       (17) Special rule for determining earned income.--Section 
     1400S(d)--
       (A) by treating an individual as a qualified individual if 
     such individual's principal place of abode on the applicable 
     disaster date was located in a Midwestern disaster area,
       (B) by treating the applicable disaster date with respect 
     to any such individual as the applicable date for purposes of 
     such subsection, and
       (C) by treating an area as described in paragraph 
     (2)(B)(ii) thereof if the area is a Midwestern disaster area 
     only by reason of subsection (b)(2) of this section (relating 
     to areas eligible only for public assistance)
       (18) Adjustments regarding taxpayer and dependency 
     status.--Section 1400S(e), by substituting ``2008 or 2009'' 
     for ``2005 or 2006''.
       (e) Modifications to Katrina Emergency Tax Relief Act of 
     2005.--The following provisions of the Katrina Emergency Tax 
     Relief Act of 2005 shall be applied with the following 
     modifications:
       (1) Additional exemption for housing displaced 
     individual.--Section 302--
       (A) by substituting ``Midwestern displaced individual'' for 
     ``Hurricane Katrina displaced individual'' each place it 
     appears, and
       (B) by treating an area as a core disaster area for 
     purposes of applying subsection (c) thereof if the area is a 
     Midwestern disaster area without regard to subsection (b)(2) 
     of this section (relating to areas eligible only for public 
     assistance).
       (2) Increase in standard mileage rate.--Section 303, by 
     substituting ``beginning on the applicable disaster date and 
     ending on December 31, 2009'' for ``beginning on August 25, 
     2005, and ending on December 31, 2006''.
       (3) Mileage reimbursements for charitable volunteers.--
     Section 304--
       (A) by substituting ``beginning on the applicable disaster 
     date and ending on December 31, 2009'' for ``beginning on 
     August 25, 2005, and ending on December 31, 2006'' in 
     subsection (a), and
       (B) by substituting ``the applicable disaster date'' for 
     ``August 25, 2005'' in subsection (a).
       (4) Exclusion of certain cancellation of indebtedness 
     income.--Section 401--
       (A) by treating an individual whose principal place of 
     abode on the applicable disaster date was in a Midwestern 
     disaster area (determined without regard to subsection (b)(2) 
     of this section) as an individual described in subsection 
     (b)(1) thereof, and by treating an individual whose principal 
     place of abode on the applicable disaster date was in a 
     Midwestern disaster area solely by reason of subsection 
     (b)(2) of this section as an individual described in 
     subsection (b)(2) thereof,
       (B) by substituting ``the applicable disaster date'' for 
     ``August 28, 2005'' both places it appears, and
       (C) by substituting ``January 1, 2010'' for ``January 1, 
     2007'' in subsection (e).
       (5) Extension of replacement period for nonrecognition of 
     gain.--Section 405, by substituting ``on or after the 
     applicable disaster date'' for ``on or after August 25, 
     2005''.

     SEC. ___. ENHANCED CHARITABLE DEDUCTIONS FOR CONTRIBUTIONS OF 
                   FOOD INVENTORY.

       (a) Increased Amount of Deduction.--
       (1) In general.--Clause (iv) of section 170(e)(3)(C) 
     (relating to termination) of the Internal Revenue Code of 
     1986 is amended by striking ``December 31, 2007'' and 
     inserting ``December 31, 2009''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply to contributions made after December 31, 2007.
       (b) Temporary Suspension of Limitations on Charitable 
     Contributions.--
       (1) In general.--Section 170(b) of such Code is amended by 
     adding at the end the following new paragraph:
       ``(3) Temporary suspension of limitations on charitable 
     contributions.--In the case of a qualified farmer or rancher 
     (as defined in paragraph (1)(E)(v)), any charitable 
     contribution of food--
       ``(A) to which subsection (e)(3)(C) applies (without regard 
     to clause (ii) thereof), and
       ``(B) which is made during the period beginning on the date 
     of the enactment of this paragraph and before January 1, 
     2009,

     shall be treated for purposes of paragraph (1)(E) or (2)(B), 
     whichever is applicable, as if it were a qualified 
     conservation contribution which is made by a qualified farmer 
     or rancher and which otherwise meets the requirements of such 
     paragraph.''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. ___. EXTENSION OF ENHANCED CHARITABLE DEDUCTION FOR 
                   CONTRIBUTIONS OF BOOK INVENTORY.

       (a) Extension.--Clause (iv) of section 170(e)(3)(D) of the 
     Internal Revenue Code of 1986 (relating to termination) of 
     the Internal Revenue Code of 1986 is amended by striking 
     ``December 31, 2007'' and inserting ``December 31, 2009''.
       (b) Clerical Amendment.--Clause (iii) of section 
     170(e)(3)(D) of such Code (relating to certification by 
     donee) is amended by inserting ``of books'' after ``to any 
     contribution''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to contributions made after December 31, 2007.

     SEC. ___. REPORTING REQUIREMENTS RELATING TO DISASTER RELIEF 
                   CONTRIBUTIONS.

       (a) In General.--Section 6033(b) of the Internal Revenue 
     Code of 1986 (relating to returns of certain organizations 
     described in section 501(c)(3)) is amended by striking 
     ``and'' at the end of paragraph (13), by redesignating 
     paragraph (14) as paragraph (15), and by adding after 
     paragraph (13) the following new paragraph:
       ``(14) such information as the Secretary may require with 
     respect to disaster relief activities, including the amount 
     and use of qualified contributions to which section 1400S(a) 
     applies, and''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to returns the due date for which (determined 
     without regard to any extension) occurs after December 31, 
     2008.
                                 ______
                                 
  SA 5039. Mr. SCHUMER submitted an amendment intended to be proposed 
by him to the bill H.R. 3221, moving the United States toward greater 
energy independence and security, developing innovative new 
technologies, reducing

[[Page S6032]]

carbon emissions, creating green jobs, protecting consumers, increasing 
clean renewable energy production, and modernizing our energy 
infrastructure, and to amend the Internal Revenue Code of 1986 to 
provide tax incentives for the production of renewable energy and 
energy conservation; which was ordered to lie on the table; as follows:

       On page 455, between lines 14 and 15, insert the following:

     SEC. 1606. VALUATION OF MULTIFAMILY PROPERTIES IN 
                   NONCOMPETITIVE SALES BY HUD TO STATES AND 
                   LOCALITIES.

       Subtitle A of title II of the Deficit Reduction Act of 2005 
     (Public Law 109-171; 120 Stat. 7) is amended by adding at the 
     end the following new section:

     ``SEC. 2004. VALUATION OF MULTIFAMILY PROPERTIES IN 
                   NONCOMPETITIVE SALES BY HUD TO STATES AND 
                   LOCALITIES.

       ``Notwithstanding any other provision of law, in 
     determining the market value of any multifamily real property 
     or multifamily loan for any noncompetitive sale to a State or 
     local government entity occurring during fiscal years 2008, 
     2009, or 2010, the Secretary shall consider, but not be 
     limited to, industry standard appraisal practices, including 
     the cost of repairs needed to bring the property at least to 
     minimum State and local code standards and of maintaining the 
     existing affordability restrictions imposed by the Secretary 
     on the multifamily real property or multifamily loan.''.
                                 ______
                                 
  SA 5040. Ms. LANDRIEU (for herself, Mr. Grassley, Mr. Harkin, and Mr. 
Wicker) submitted an amendment intended to be proposed to amendment SA 
4983 proposed by Mr. Reid (for Mr. Dodd (for himself and Mr. Shelby)) 
to the bill H.R. 3221, moving the United States toward greater energy 
independence and security, developing innovative new technologies, 
reducing carbon emissions, creating green jobs, protecting consumers, 
increasing clean renewable energy production, and modernizing our 
energy infrastructure, and to amend the Internal Revenue Code of 1986 
to provide tax incentives for the production of renewable energy and 
energy conservation; which was ordered to lie on the table; as follows:

       On page 510, strike lines 1 through 5, and insert the 
     following:
       (C) establish land banks for homes that have been 
     foreclosed upon;
       (D) demolish blighted structures; and
       (E) redevelop demolished, blighted, or vacant properties, 
     including those damaged or destroyed in areas subject to a 
     disaster declaration by the President under title IV of the 
     Robert T. Stafford Disaster Relief and Emergency Assistance 
     Act (42 U.S.C. 5121 et seq.).
                                 ______
                                 
  SA 5041. Mr. CASEY (for himself and Mr. Specter) submitted an 
amendment intended to be proposed to amendment SA 4983 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mr. Shelby)) to the bill H.R. 3221, 
moving the United States toward greater energy independence and 
security, developing innovative new technologies, reducing carbon 
emissions, creating green jobs, protecting consumers, increasing clean 
renewable energy production, and modernizing our energy infrastructure, 
and to amend the Internal Revenue Code of 1986 to provide tax 
incentives for the production of renewable energy and energy 
conservation; which was ordered to lie on the table; as follows:

       On page 455, between lines 14 and 15, insert the following:

     SEC. 1606. SENSE OF THE SENATE ON THE JOINT EFFORTS OF THE 
                   CITY OF PHILADELPHIA AND PHILADELPHIA COURT OF 
                   COMMON PLEAS TO PREVENT HOME FORECLOSURES.

       (a) Findings.--The Senate finds that--
       (1) the Mortgage Bankers Association reported this month 
     that over 1,000,000 homes have entered foreclosure 
     proceedings, the highest rate of such proceedings ever 
     recorded;
       (2) the Center for Responsible Lending reports that 
     7,200,000 families now hold a subprime loan;
       (3) the Joint Economic Committee of the Congress estimates 
     that from the third quarter of 2007 through the fourth 
     quarter of 2009 there will be 45,470 subprime foreclosures in 
     Pennsylvania;
       (4) the Joint Economic Committee further predicts that the 
     cumulative loss in property value resulting from these 
     foreclosures will exceed $2,400,000,000 and the estimated 
     loss in property taxes will be $34,000,000;
       (5) the Pew Charitable Trusts reports that 1,684,475 
     Pennsylvania homeowners will experience home devaluation due 
     to subprime foreclosures in 2008 and 2009;
       (6) a 2005 Freddie Mac/Roper poll of homeowners indicates 
     that more than 6 in 10 delinquent borrowers are not aware of 
     services that lenders offer to individuals having trouble 
     with their mortgage;
       (7) the Department of Housing and Urban Development program 
     statistics show that 96 percent of the families that receive 
     housing counseling services avoid foreclosure;
       (8) Philadelphia County reported 730 properties filed for 
     foreclosure in April 2008, more foreclosure filings than any 
     other county in Pennsylvania;
       (9) the Center for Responsible Lending estimates that 
     Philadelphia County could lose up to 4,444 homes to 
     foreclosure; and
       (10) it has been over 1 year since the first legislation 
     dealing with the subprime mortgage crisis was introduced in 
     the Senate to consider housing legislation that provides 
     homeowners with relief and that alleviates the foreclosure 
     crisis.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that--
       (1) the City of Philadelphia and the Philadelphia Court of 
     Common Pleas should be commended for their efforts to 
     facilitate negotations between borrowers and lenders to 
     attempt to restructure loan terms and prevent foreclosures;
       (2) the commitment of such entitites to their home 
     foreclosure prevention program, such program's requirement of 
     mandatory counseling for delinquent borrowers, and such 
     program's use of professional housing counselors to negotiate 
     between lenders and homeowners represent the best practices 
     in the industry; and
       (3) the Secretary of Housing and Urban Development should, 
     to the extent possible, inform other cities about the 
     Philadelphia program and advise such other cities that the 
     funds provided under section 2401 may be used to defray the 
     cost of similar foreclosure prevention programs.
                                 ______
                                 
  SA 5042. Mr. WYDEN (for himself, Mr. Smith, Ms. Cantwell, and Mrs. 
Murray) submitted an amendment intended to be proposed to amendment SA 
4983 proposed by Mr. Reid (for Mr. Dodd (for himself and Mr. Shelby)) 
to the bill H.R. 3221, moving the United States toward greater energy 
independence and security; developing innovative new technologies, 
reducing carbon emissions, creating green jobs, protecting consumers, 
increasing clean renewable energy production, and modernizing our 
energy infrastructure, and to amend the Internal Revenue Code of 1986 
to provide tax incentives for the production of renewable energy and 
energy conservation; which was ordered to lie on the table; as follows:

       On page 614, line 23, insert ``, but only with respect to 
     property the acquisition of which has not occurred, or the 
     construction, reconstruction, or renovation of which has not 
     begun, before the date of the enactment of the Housing 
     Assistance Tax Act of 2008'' after ``Alabama''.
                                 ______
                                 
  SA 5043. Mr. BINGAMAN (for himself and Mr. Domenici) submitted an 
amendment intended to be proposed to amendment SA 4983 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mr. Shelby)) to the bill H.R. 3221, 
moving the United States toward greater energy independence and 
security; developing innovative new technologies, reducing carbon 
emissions, creating green jobs, protecting consumers, increasing clean 
renewable energy production, and modernizing our energy infrastructure, 
and to amend the Internal Revenue Code of 1986 to provide tax 
incentives for the production of renewable energy and energy 
conservation; which was ordered to lie on the table; as follows:

       At the appropriate place, insert the following:

     SEC. _____. INCREASING ACCESS AND UNDERSTANDING OF ENERGY 
                   EFFICIENT MORTGAGES.

       (a) Definition.--As used in this section, the term ``energy 
     efficient mortgage'' has the same meaning as given that term 
     in paragraph (24) of section 104 of the Cranston-Gonzalez 
     National Affordable Housing Act (42 U.S.C. 12704(24)).
       (b) Recommendations To Eliminate Barriers to Use of Energy 
     Efficient Mortgages.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this section, the Secretary of Housing and Urban 
     Development, in conjunction with the Secretary of Energy and 
     the Administrator of the Environmental Protection Agency, 
     shall consult with the residential mortgage industry and 
     States to develop recommendations to eliminate the barriers 
     that exist to increasing the availability, use, and purchase 
     of energy efficient mortgages, including such barriers as--
       (A) the lack of reliable and accessible information on such 
     mortgages, including estimated energy savings and other 
     benefits of energy efficient housing;
       (B) the confusion regarding underwriting requirements and 
     differences among various energy efficient mortgage programs;
       (C) the complex and time consuming process of securing such 
     mortgages;
       (D) the lack of publicly available research on the default 
     risk of such mortgages; and
       (E) the availability of certified or accredited home energy 
     rating services.
       (2) Report to congress.--The Secretary of Housing and Urban 
     Development shall submit a report to Congress that--
       (A) summarizes the recommendations developed under 
     paragraph (1); and

[[Page S6033]]

       (B) includes any recommendations for statutory, regulatory, 
     or administrative changes the Secretary deems necessary to 
     institute such recommendations.
       (c) Energy Efficient Mortgages Outreach Campaign.--
       (1) In general.--The Secretary of Housing and Urban 
     Development, in consultation and coordination with the 
     Secretary of Energy, the Administrator of the Environmental 
     Protection Agency, and State Energy and Housing Finance 
     Directors, shall carry out an education and outreach campaign 
     to inform and educate consumers, home builders, residential 
     lenders, and other real estate professionals on the 
     availability, benefits, and advantages of--
       (A) improved energy efficiency in housing; and
       (B) energy efficient mortgages.
       (2) Authorization of appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     the education and outreach campaign described under paragraph 
     (1).
                                 ______
                                 
  SA 5044. Mrs. LINCOLN (for herself and Mr. Smith) submitted an 
amendment intended to be proposed to amendment SA 4983 proposed by Mr. 
Reid (for Mr. Dodd (for himself and Mr. Shelby)) to the bill H.R. 3221, 
moving the United States toward greater energy independence and 
security; developing innovative new technologies, reducing carbon 
emissions, creating green jobs, protecting consumers, increasing clean 
renewable energy production, and modernizing our energy infrastructure, 
and to amend the Internal Revenue Code of 1986 to provide tax 
incentives for the production of renewable energy and energy 
conservation; which was ordered to lie on the table; as follows:

       On page 587, line 24, insert ``and `80 percent of the class 
     life of such property' shall be substituted for `20 years' in 
     paragraph (1)(B)(ii)(III) thereof'' after ``thereof''.
                                 ______
                                 
  SA 5045. Mr. BAUCUS submitted an amendment intended to be proposed by 
him to the bill H.R. 3221, moving the United States toward greater 
energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 630, after line 2, insert the following:

                    TITLE IV--ENERGY TAX INCENTIVES

                Subtitle A--Energy Production Incentives

                  PART I--RENEWABLE ENERGY INCENTIVES

     SEC. 3101. RENEWABLE ENERGY CREDIT.

       (a) Extension of Credit.--
       (1) 1-year extension for wind facilities.--Paragraph (1) of 
     section 45(d) is amended by striking ``January 1, 2009'' and 
     inserting ``January 1, 2010''.
       (2) 3-year extension for certain other facilities.--Each of 
     the following provisions of section 45(d) is amended by 
     striking ``January 1, 2009'' and inserting ``January 1, 
     2012'':
       (A) Clauses (i) and (ii) of paragraph (2)(A).
       (B) Clauses (i)(I) and (ii) of paragraph (3)(A).
       (C) Paragraph (4).
       (D) Paragraph (5).
       (E) Paragraph (6).
       (F) Paragraph (7).
       (G) Subparagraphs (A) and (B) of paragraph (9).
       (b) Modification of Credit Phaseout.--
       (1) Repeal of phaseout.--Subsection (b) of section 45 is 
     amended--
       (A) by striking paragraph (1), and
       (B) by striking ``the 8 cent amount in paragraph (1),'' in 
     paragraph (2) thereof.
       (2) Limitation based on investment in facility.--Subsection 
     (b) of section 45 is amended by inserting before paragraph 
     (2) the following new paragraph:
       ``(1) Limitation based on investment in facility.--
       ``(A) In general.--In the case of any qualified facility 
     originally placed in service after December 31, 2009, the 
     amount of the credit determined under subsection (a) for any 
     taxable year with respect to electricity produced at such 
     facility shall not exceed the product of--
       ``(i) the applicable percentage with respect to such 
     facility, multiplied by
       ``(ii) the eligible basis of such facility.
       ``(B) Carryforward of unused limitation and excess 
     credit.--
       ``(i) Unused limitation.--If the limitation imposed under 
     subparagraph (A) with respect to any facility for any taxable 
     year exceeds the prelimitation credit for such facility for 
     such taxable year, the limitation imposed under subparagraph 
     (A) with respect to such facility for the succeeding taxable 
     year shall be increased by the amount of such excess.
       ``(ii) Excess credit.--If the prelimitation credit with 
     respect to any facility for any taxable year exceeds the 
     limitation imposed under subparagraph (A) with respect to 
     such facility for such taxable year, the credit determined 
     under subsection (a) with respect to such facility for the 
     succeeding taxable year (determined before the application of 
     subparagraph (A) for such succeeding taxable year) shall be 
     increased by the amount of such excess. With respect to any 
     facility, no amount may be carried forward under this clause 
     to any taxable year beginning after the 10-year period 
     described in subsection (a)(2)(A)(ii) with respect to such 
     facility.
       ``(iii) Prelimitation credit.--The term `prelimitation 
     credit' with respect to any facility for a taxable year means 
     the credit determined under subsection (a) with respect to 
     such facility for such taxable year, determined without 
     regard to subparagraph (A) and after taking into account any 
     increase for such taxable year under clause (ii).
       ``(C) Applicable percentage.--For purposes of this 
     paragraph--
       ``(i) In general.--The term `applicable percentage' means, 
     with respect to any facility, the appropriate percentage 
     prescribed by the Secretary for the month in which such 
     facility is originally placed in service.
       ``(ii) Method of prescribing applicable percentages.--The 
     applicable percentages prescribed by the Secretary for any 
     month under clause (i) shall be percentages which yield over 
     a 10-year period amounts of limitation under subparagraph (A) 
     which have a present value equal to 35 percent of the 
     eligible basis of the facility.
       ``(iii) Method of discounting.--The present value under 
     clause (ii) shall be determined--

       ``(I) as of the last day of the 1st year of the 10-year 
     period referred to in clause (ii),
       ``(II) by using a discount rate equal to the greater of 110 
     percent of the Federal long-term rate as in effect under 
     section 1274(d) for the month preceding the month for which 
     the applicable percentage is being prescribed, or 4.5 
     percent, and
       ``(III) by taking into account the limitation under 
     subparagraph (A) for any year on the last day of such year.

       ``(D) Eligible basis.--For purposes of this paragraph--
       ``(i) In general.--The term `eligible basis' means, with 
     respect to any facility, the sum of--

       ``(I) the basis of such facility determined as of the time 
     that such facility is originally placed in service, and
       ``(II) the portion of the basis of any shared qualified 
     property which is properly allocable to such facility under 
     clause (ii).

       ``(ii) Rules for allocation.--For purposes of subclause 
     (II) of clause (i), the basis of shared qualified property 
     shall be allocated among all qualified facilities which are 
     projected to be placed in service and which require 
     utilization of such property in proportion to projected 
     generation from such facilities.
       ``(iii) Shared qualified property.--For purposes of this 
     paragraph, the term `shared qualified property' means, with 
     respect to any facility, any property described in section 
     168(e)(3)(B)(vi)--

       ``(I) which a qualified facility will require for 
     utilization of such facility, and
       ``(II) which is not a qualified facility.

       ``(iv) Special rule relating to geothermal facilities.--In 
     the case of any qualified facility using geothermal energy to 
     produce electricity, the basis of such facility for purposes 
     of this paragraph shall be determined as though intangible 
     drilling and development costs described in section 263(c) 
     were capitalized rather than expensed.
       ``(E) Special rule for first and last year of credit 
     period.--In the case of any taxable year any portion of which 
     is not within the 10-year period described in subsection 
     (a)(2)(A)(ii) with respect to any facility, the amount of the 
     limitation under subparagraph (A) with respect to such 
     facility shall be reduced by an amount which bears the same 
     ratio to the amount of such limitation (determined without 
     regard to this subparagraph) as such portion of the taxable 
     year which is not within such period bears to the entire 
     taxable year.
       ``(F) Election to treat all facilities placed in service in 
     a year as 1 facility.--At the election of the taxpayer, all 
     qualified facilities which are part of the same project and 
     which are placed in service during the same calendar year 
     shall be treated for purposes of this section as 1 facility 
     which is placed in service at the mid-point of such year or 
     the first day of the following calendar year.''.
       (c) Trash Facility Clarification.--Paragraph (7) of section 
     45(d) is amended--
       (1) by striking ``facility which burns'' and inserting 
     ``facility (other than a facility described in paragraph (6)) 
     which uses'', and
       (2) by striking ``combustion''.
       (d) Expansion of Biomass Facilities.--
       (1) Open-loop biomass facilities.--Paragraph (3) of section 
     45(d) is amended by redesignating subparagraph (B) as 
     subparagraph (C) and by inserting after subparagraph (A) the 
     following new subparagraph:
       ``(B) Expansion of facility.--Such term shall include a new 
     unit placed in service after the date of the enactment of 
     this subparagraph in connection with a facility described in 
     subparagraph (A), but only to the extent of the increased 
     amount of electricity produced at the facility by reason of 
     such new unit.''.
       (2) Closed-loop biomass facilities.--Paragraph (2) of 
     section 45(d) is amended by redesignating subparagraph (B) as 
     subparagraph (C) and inserting after subparagraph (A) the 
     following new subparagraph:

[[Page S6034]]

       ``(B) Expansion of facility.--Such term shall include a new 
     unit placed in service after the date of the enactment of 
     this subparagraph in connection with a facility described in 
     subparagraph (A)(i), but only to the extent of the increased 
     amount of electricity produced at the facility by reason of 
     such new unit.''.
       (e) Sales of Net Electricity to Regulated Public Utilities 
     Treated as Sales to Unrelated Persons.--Paragraph (4) of 
     section 45(e) is amended by adding at the end the following 
     new sentence: ``The net amount of electricity sold by any 
     taxpayer to a regulated public utility (as defined in section 
     7701(a)(33)) shall be treated as sold to an unrelated 
     person.''.
       (f) Modification of Rules for Hydropower Production.--
     Subparagraph (C) of section 45(c)(8) is amended to read as 
     follows:
       ``(C) Nonhydroelectric dam.--For purposes of subparagraph 
     (A), a facility is described in this subparagraph if--
       ``(i) the hydroelectric project installed on the 
     nonhydroelectric dam is licensed by the Federal Energy 
     Regulatory Commission and meets all other applicable 
     environmental, licensing, and regulatory requirements,
       ``(ii) the nonhydroelectric dam was placed in service 
     before the date of the enactment of this paragraph and 
     operated for flood control, navigation, or water supply 
     purposes and did not produce hydroelectric power on the date 
     of the enactment of this paragraph, and
       ``(iii) the hydroelectric project is operated so that the 
     water surface elevation at any given location and time that 
     would have occurred in the absence of the hydroelectric 
     project is maintained, subject to any license requirements 
     imposed under applicable law that change the water surface 
     elevation for the purpose of improving environmental quality 
     of the affected waterway.

     The Secretary, in consultation with the Federal Energy 
     Regulatory Commission, shall certify if a hydroelectric 
     project licensed at a nonhydroelectric dam meets the criteria 
     in clause (iii). Nothing in this section shall affect the 
     standards under which the Federal Energy Regulatory 
     Commission issues licenses for and regulates hydropower 
     projects under part I of the Federal Power Act.''.
       (g) Effective Date.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall apply 
     to property originally placed in service after December 31, 
     2008.
       (2) Repeal of credit phaseout.--The amendments made by 
     subsection (b)(1) shall apply to taxable years ending after 
     December 31, 2008.
       (3) Limitation based on investment in facility.--The 
     amendment made by subsection (b)(2) shall apply to property 
     originally placed in service after December 31, 2009.
       (4) Trash facility clarification; sales to related 
     regulated public utilities.--The amendments made by 
     subsections (c) and (e) shall apply to electricity produced 
     and sold after the date of the enactment of this Act.
       (5) Expansion of biomass facilities.--The amendments made 
     by subsection (d) shall apply to property placed in service 
     after the date of the enactment of this Act.

     SEC. 3102. PRODUCTION CREDIT FOR ELECTRICITY PRODUCED FROM 
                   MARINE RENEWABLES.

       (a) In General.--Paragraph (1) of section 45(c) is amended 
     by striking ``and'' at the end of subparagraph (G), by 
     striking the period at the end of subparagraph (H) and 
     inserting ``, and'', and by adding at the end the following 
     new subparagraph:
       ``(I) marine and hydrokinetic renewable energy.''.
       (b) Marine Renewables.--Subsection (c) of section 45 is 
     amended by adding at the end the following new paragraph:
       ``(10) Marine and hydrokinetic renewable energy.--
       ``(A) In general.--The term `marine and hydrokinetic 
     renewable energy' means energy derived from--
       ``(i) waves, tides, and currents in oceans, estuaries, and 
     tidal areas,
       ``(ii) free flowing water in rivers, lakes, and streams,
       ``(iii) free flowing water in an irrigation system, canal, 
     or other man-made channel, including projects that utilize 
     nonmechanical structures to accelerate the flow of water for 
     electric power production purposes, or
       ``(iv) differentials in ocean temperature (ocean thermal 
     energy conversion).
       ``(B) Exceptions.--Such term shall not include any energy 
     which is derived from any source which utilizes a dam, 
     diversionary structure (except as provided in subparagraph 
     (A)(iii)), or impoundment for electric power production 
     purposes.''.
       (c) Definition of Facility.--Subsection (d) of section 45 
     is amended by adding at the end the following new paragraph:
       ``(11) Marine and hydrokinetic renewable energy 
     facilities.--In the case of a facility producing electricity 
     from marine and hydrokinetic renewable energy, the term 
     `qualified facility' means any facility owned by the 
     taxpayer--
       ``(A) which has a nameplate capacity rating of at least 150 
     kilowatts, and
       ``(B) which is originally placed in service on or after the 
     date of the enactment of this paragraph and before January 1, 
     2012.''.
       (d) Credit Rate.--Subparagraph (A) of section 45(b)(4) is 
     amended by striking ``or (9)'' and inserting ``(9), or 
     (11)''.
       (e) Coordination With Small Irrigation Power.--Paragraph 
     (5) of section 45(d), as amended by section 3101, is amended 
     by striking ``January 1, 2012'' and inserting ``the date of 
     the enactment of paragraph (11)''.
       (f) Effective Date.--The amendments made by this section 
     shall apply to electricity produced and sold after the date 
     of the enactment of this Act, in taxable years ending after 
     such date.

     SEC. 3103. ENERGY CREDIT.

       (a) Extension of Credit.--
       (1) Solar energy property.--Paragraphs (2)(A)(i)(II) and 
     (3)(A)(ii) of section 48(a) are each amended by striking 
     ``January 1, 2009'' and inserting ``January 1, 2015''.
       (2) Fuel cell property.--Subparagraph (E) of section 
     48(c)(1) is amended by striking ``December 31, 2008'' and 
     inserting ``December 31, 2014''.
       (3) Microturbine property.--Subparagraph (E) of section 
     48(c)(2) is amended by striking ``December 31, 2008'' and 
     inserting ``December 31, 2014''.
       (b) Allowance of Energy Credit Against Alternative Minimum 
     Tax.--Subparagraph (B) of section 38(c)(4) is amended by 
     striking ``and'' at the end of clause (iii), by redesignating 
     clause (iv) as clause (v), and by inserting after clause 
     (iii) the following new clause:
       ``(iv) the credit determined under section 46 to the extent 
     that such credit is attributable to the energy credit 
     determined under section 48, and''.
       (c) Energy Credit for Combined Heat and Power System 
     Property.--
       (1) In general.--Section 48(a)(3)(A) (defining energy 
     property) is amended by striking ``or'' at the end of clause 
     (iii), by inserting ``or'' at the end of clause (iv), and by 
     adding at the end the following new clause:
       ``(v) combined heat and power system property,''.
       (2) Combined heat and power system property.--Section 48 is 
     amended by adding at the end the following new subsection:
       ``(d) Combined Heat and Power System Property.--For 
     purposes of subsection (a)(3)(A)(v)--
       ``(1) Combined heat and power system property.--The term 
     `combined heat and power system property' means property 
     comprising a system--
       ``(A) which uses the same energy source for the 
     simultaneous or sequential generation of electrical power, 
     mechanical shaft power, or both, in combination with the 
     generation of steam or other forms of useful thermal energy 
     (including heating and cooling applications),
       ``(B) which produces--
       ``(i) at least 20 percent of its total useful energy in the 
     form of thermal energy which is not used to produce 
     electrical or mechanical power (or combination thereof), and
       ``(ii) at least 20 percent of its total useful energy in 
     the form of electrical or mechanical power (or combination 
     thereof),
       ``(C) the energy efficiency percentage of which exceeds 60 
     percent, and
       ``(D) which is placed in service before January 1, 2015.
       ``(2) Limitation.--
       ``(A) In general.--In the case of combined heat and power 
     system property with an electrical capacity in excess of the 
     applicable capacity placed in service during the taxable 
     year, the credit under subsection (a)(1) (determined without 
     regard to this paragraph) for such year shall be equal to the 
     amount which bears the same ratio to such credit as the 
     applicable capacity bears to the capacity of such property.
       ``(B) Applicable capacity.--For purposes of subparagraph 
     (A), the term `applicable capacity' means 15 megawatts or a 
     mechanical energy capacity of more than 20,000 horsepower or 
     an equivalent combination of electrical and mechanical energy 
     capacities.
       ``(C) Maximum capacity.--The term `combined heat and power 
     system property' shall not include any property comprising a 
     system if such system has a capacity in excess of 50 
     megawatts or a mechanical energy capacity in excess of 67,000 
     horsepower or an equivalent combination of electrical and 
     mechanical energy capacities.
       ``(3) Special rules.--
       ``(A) Energy efficiency percentage.--For purposes of this 
     subsection, the energy efficiency percentage of a system is 
     the fraction--
       ``(i) the numerator of which is the total useful 
     electrical, thermal, and mechanical power produced by the 
     system at normal operating rates, and expected to be consumed 
     in its normal application, and
       ``(ii) the denominator of which is the lower heating value 
     of the fuel sources for the system.
       ``(B) Determinations made on btu basis.--The energy 
     efficiency percentage and the percentages under paragraph 
     (1)(B) shall be determined on a Btu basis.
       ``(C) Input and output property not included.--The term 
     `combined heat and power system property' does not include 
     property used to transport the energy source to the facility 
     or to distribute energy produced by the facility.
       ``(4) Systems using biomass.--If a system is designed to 
     use biomass (within the meaning of paragraphs (2) and (3) of 
     section 45(c) without regard to the last sentence of 
     paragraph (3)(A)) for at least 90 percent of the energy 
     source--
       ``(A) paragraph (1)(C) shall not apply, but
       ``(B) the amount of credit determined under subsection (a) 
     with respect to such system shall not exceed the amount which

[[Page S6035]]

     bears the same ratio to such amount of credit (determined 
     without regard to this paragraph) as the energy efficiency 
     percentage of such system bears to 60 percent.''.
       (d) Increase of Credit Limitation for Fuel Cell Property.--
     Subparagraph (B) of section 48(c)(1) is amended by striking 
     ``$500'' and inserting ``$1,500''.
       (e) Public Utility Property Taken Into Account.--
       (1) In general.--Paragraph (3) of section 48(a) is amended 
     by striking the second sentence thereof.
       (2) Conforming amendments.--
       (A) Paragraph (1) of section 48(c) is amended by striking 
     subparagraph (D) and redesignating subparagraph (E) as 
     subparagraph (D).
       (B) Paragraph (2) of section 48(c) is amended by striking 
     subparagraph (D) and redesignating subparagraph (E) as 
     subparagraph (D).
       (f) Effective Date.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall take 
     effect on the date of the enactment of this Act.
       (2) Allowance against alternative minimum tax.--The 
     amendments made by subsection (b) shall apply to credits 
     determined under section 46 of the Internal Revenue Code of 
     1986 in taxable years beginning after the date of the 
     enactment of this Act and to carrybacks of such credits.
       (3) Combined heat and power and fuel cell property.--The 
     amendments made by subsections (c) and (d) shall apply to 
     periods after the date of the enactment of this Act, in 
     taxable years ending after such date, under rules similar to 
     the rules of section 48(m) of the Internal Revenue Code of 
     1986 (as in effect on the day before the date of the 
     enactment of the Revenue Reconciliation Act of 1990).
       (4)  Public utility property.--The amendments made by 
     subsection (e) shall apply to periods after February 13, 
     2008, in taxable years ending after such date, under rules 
     similar to the rules of section 48(m) of the Internal Revenue 
     Code of 1986 (as in effect on the day before the date of the 
     enactment of the Revenue Reconciliation Act of 1990).

     SEC. 3104. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT PROPERTY.

       (a) Extension.--Section 25D(g) is amended by striking 
     ``December 31, 2008'' and inserting ``December 31, 2014''.
       (b) Maximum Credit for Solar Electric Property.--
       (1) In general.--Section 25D(b)(1)(A) is amended by 
     striking ``$2,000'' and inserting ``$4,000''.
       (2) Conforming amendment.--Section 25D(e)(4)(A)(i) is 
     amended by striking ``$6,667'' and inserting ``$13,333''.
       (c) Credit for Residential Wind Property.--
       (1) In general.--Section 25D(a) is amended by striking 
     ``and'' at the end of paragraph (2), by striking the period 
     at the end of paragraph (3) and inserting ``, and'', and by 
     adding at the end the following new paragraph:
       ``(4) 30 percent of the qualified small wind energy 
     property expenditures made by the taxpayer during such 
     year.''.
       (2) Limitation.--Section 25D(b)(1) is amended by striking 
     ``and'' at the end of subparagraph (B), by striking the 
     period at the end of subparagraph (C) and inserting ``, 
     and'', and by adding at the end the following new 
     subparagraph:
       ``(D) $500 with respect to each half kilowatt of capacity 
     (not to exceed $4,000) of wind turbines for which qualified 
     small wind energy property expenditures are made.''.
       (3) Qualified small wind energy property expenditures.--
       (A) In general.--Section 25D(d) is amended by adding at the 
     end the following new paragraph:
       ``(4) Qualified small wind energy property expenditure.--
     The term `qualified small wind energy property expenditure' 
     means an expenditure for property which uses a wind turbine 
     to generate electricity for use in connection with a dwelling 
     unit located in the United States and used as a residence by 
     the taxpayer.''.
       (B) No double benefit.--Section 45(d)(1) is amended by 
     adding at the end the following new sentence: ``Such term 
     shall not include any facility with respect to which any 
     qualified small wind energy property expenditure (as defined 
     in subsection (d)(4) of section 25D) is taken into account in 
     determining the credit under such section.''.
       (4) Maximum expenditures in case of joint occupancy.--
     Section 25D(e)(4)(A) is amended by striking ``and'' at the 
     end of clause (ii), by striking the period at the end of 
     clause (iii) and inserting ``, and'', and by adding at the 
     end the following new clause:
       ``(iv) $1,667 in the case of each half kilowatt of capacity 
     (not to exceed $13,333) of wind turbines for which qualified 
     small wind energy property expenditures are made.''.
       (d) Credit for Geothermal Heat pump Systems.--
       (1) In general.--Section 25D(a), as amended by subsection 
     (c), is amended by striking ``and'' at the end of paragraph 
     (3), by striking the period at the end of paragraph (4) and 
     inserting ``, and'', and by adding at the end the following 
     new paragraph:
       ``(5) 30 percent of the qualified geothermal heat pump 
     property expenditures made by the taxpayer during such 
     year.''.
       (2) Limitation.--Section 25D(b)(1), as amended by 
     subsection (c), is amended by striking ``and'' at the end of 
     subparagraph (C), by striking the period at the end of 
     subparagraph (D) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(E) $2,000 with respect to any qualified geothermal heat 
     pump property expenditures.''.
       (3) Qualified geothermal heat pump property expenditure.--
     Section 25D(d), as amended by subsection (c), is amended by 
     adding at the end the following new paragraph:
       ``(5) Qualified geothermal heat pump property 
     expenditure.--
       ``(A) In general.--The term `qualified geothermal heat pump 
     property expenditure' means an expenditure for qualified 
     geothermal heat pump property installed on or in connection 
     with a dwelling unit located in the United States and used as 
     a residence by the taxpayer.
       ``(B) Qualified geothermal heat pump property.--The term 
     `qualified geothermal heat pump property' means any equipment 
     which--
       ``(i) uses the ground or ground water as a thermal energy 
     source to heat the dwelling unit referred to in subparagraph 
     (A) or as a thermal energy sink to cool such dwelling unit, 
     and
       ``(ii) meets the requirements of the Energy Star program 
     which are in effect at the time that the expenditure for such 
     equipment is made.''.
       (4) Maximum expenditures in case of joint occupancy.--
     Section 25D(e)(4)(A), as amended by subsection (c), is 
     amended by striking ``and'' at the end of clause (iii), by 
     striking the period at the end of clause (iv) and inserting 
     ``, and'', and by adding at the end the following new clause:
       ``(v) $6,667 in the case of any qualified geothermal heat 
     pump property expenditures.''.
       (e) Credit Allowed Against Alternative Minimum Tax.--
       (1) In general.--Subsection (c) of section 25D is amended 
     to read as follows:
       ``(c) Limitation Based on Amount of Tax; Carryforward of 
     Unused Credit.--
       ``(1) Limitation based on amount of tax.--In the case of a 
     taxable year to which section 26(a)(2) does not apply, the 
     credit allowed under subsection (a) for the taxable year 
     shall not exceed the excess of--
       ``(A) the sum of the regular tax liability (as defined in 
     section 26(b)) plus the tax imposed by section 55, over
       ``(B) the sum of the credits allowable under this subpart 
     (other than this section) and section 27 for the taxable 
     year.
       ``(2) Carryforward of unused credit.--
       ``(A) Rule for years in which all personal credits allowed 
     against regular and alternative minimum tax.--In the case of 
     a taxable year to which section 26(a)(2) applies, if the 
     credit allowable under subsection (a) exceeds the limitation 
     imposed by section 26(a)(2) for such taxable year reduced by 
     the sum of the credits allowable under this subpart (other 
     than this section), such excess shall be carried to the 
     succeeding taxable year and added to the credit allowable 
     under subsection (a) for such succeeding taxable year.
       ``(B) Rule for other years.--In the case of a taxable year 
     to which section 26(a)(2) does not apply, if the credit 
     allowable under subsection (a) exceeds the limitation imposed 
     by paragraph (1) for such taxable year, such excess shall be 
     carried to the succeeding taxable year and added to the 
     credit allowable under subsection (a) for such succeeding 
     taxable year.''.
       (2) Conforming amendments.--
       (A) Section 23(b)(4)(B) is amended by inserting ``and 
     section 25D'' after ``this section''.
       (B) Section 24(b)(3)(B) is amended by striking ``and 25B'' 
     and inserting ``, 25B, and 25D''.
       (C) Section 25B(g)(2) is amended by striking ``section 23'' 
     and inserting ``sections 23 and 25D''.
       (D) Section 26(a)(1) is amended by striking ``and 25B'' and 
     inserting ``25B, and 25D''.
       (f) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     apply to taxable years beginning after December 31, 2007.
       (2) Application of egtrra sunset.--The amendments made by 
     subparagraphs (A) and (B) of subsection (e)(2) shall be 
     subject to title IX of the Economic Growth and Tax Relief 
     Reconciliation Act of 2001 in the same manner as the 
     provisions of such Act to which such amendments relate.

     SEC. 3105. SPECIAL RULE TO IMPLEMENT FERC AND STATE ELECTRIC 
                   RESTRUCTURING POLICY.

       (a) Extension for Qualified Electric Utilities.--
       (1) In general.--Paragraph (3) of section 451(i) is amended 
     by inserting ``(before January 1, 2010, in the case of a 
     qualified electric utility)'' after ``January 1, 2008''.
       (2) Qualified electric utility.--Subsection (i) of section 
     451 is amended by redesignating paragraphs (6) through (10) 
     as paragraphs (7) through (11), respectively, and by 
     inserting after paragraph (5) the following new paragraph:
       ``(6) Qualified electric utility.--For purposes of this 
     subsection, the term `qualified electric utility' means a 
     person that, as of the date of the qualifying electric 
     transmission transaction, is vertically integrated, in that 
     it is both--
       ``(A) a transmitting utility (as defined in section 3(23) 
     of the Federal Power Act (16 U.S.C. 796(23))) with respect to 
     the transmission facilities to which the election under this 
     subsection applies, and

[[Page S6036]]

       ``(B) an electric utility (as defined in section 3(22) of 
     the Federal Power Act (16 U.S.C. 796(22))).''.
       (b) Extension of Period for Transfer of Operational Control 
     Authorized by FERC.--Clause (ii) of section 451(i)(4)(B) is 
     amended by striking ``December 31, 2007'' and inserting ``the 
     date which is 4 years after the close of the taxable year in 
     which the transaction occurs''.
       (c) Property Located Outside the United States Not Treated 
     as Exempt Utility Property.--Paragraph (5) of section 451(i) 
     is amended by adding at the end the following new 
     subparagraph:
       ``(C) Exception for property located outside the united 
     states.--The term `exempt utility property' shall not include 
     any property which is located outside the United States.''.
       (d) Effective Dates.--
       (1) Extension.--The amendments made by subsection (a) shall 
     apply to transactions after December 31, 2007.
       (2) Transfers of operational control.--The amendment made 
     by subsection (b) shall take effect as if included in section 
     909 of the American Jobs Creation Act of 2004.
       (3) Exception for property located outside the united 
     states.--The amendment made by subsection (c) shall apply to 
     transactions after the date of the enactment of this Act.

     SEC. 3106. NEW CLEAN RENEWABLE ENERGY BONDS.

       (a) In General.--Subpart I of part IV of subchapter A of 
     chapter 1 is amended by adding at the end the following new 
     section:

     ``SEC. 54C. NEW CLEAN RENEWABLE ENERGY BONDS.

       ``(a) New Clean Renewable Energy Bond.--For purposes of 
     this subpart, the term `new clean renewable energy bond' 
     means any bond issued as part of an issue if--
       ``(1) 100 percent of the available project proceeds of such 
     issue are to be used for capital expenditures incurred by 
     governmental bodies, public power providers, or cooperative 
     electric companies for one or more qualified renewable energy 
     facilities,
       ``(2) the bond is issued by a qualified issuer, and
       ``(3) the issuer designates such bond for purposes of this 
     section.
       ``(b) Reduced Credit Amount.--The annual credit determined 
     under section 54A(b) with respect to any new clean renewable 
     energy bond shall be 70 percent of the amount so determined 
     without regard to this subsection.
       ``(c) Limitation on Amount of Bonds Designated.--
       ``(1) In general.--The maximum aggregate face amount of 
     bonds which may be designated under subsection (a) by any 
     issuer shall not exceed the limitation amount allocated under 
     this subsection to such issuer.
       ``(2) National limitation on amount of bonds designated.--
     There is a national new clean renewable energy bond 
     limitation of $2,000,000,000 which shall be allocated by the 
     Secretary as provided in paragraph (3), except that--
       ``(A) not more than 33\1/3\ percent thereof may be 
     allocated to qualified projects of public power providers,
       ``(B) not more than 33\1/3\ percent thereof may be 
     allocated to qualified projects of governmental bodies, and
       ``(C) not more than 33\1/3\ percent thereof may be 
     allocated to qualified projects of cooperative electric 
     companies.
       ``(3) Method of allocation.--
       ``(A) Allocation among public power providers.--After the 
     Secretary determines the qualified projects of public power 
     providers which are appropriate for receiving an allocation 
     of the national new clean renewable energy bond limitation, 
     the Secretary shall, to the maximum extent practicable, make 
     allocations among such projects in such manner that the 
     amount allocated to each such project bears the same ratio to 
     the cost of such project as the limitation under paragraph 
     (2)(A) bears to the cost of all such projects.
       ``(B) Allocation among governmental bodies and cooperative 
     electric companies.--The Secretary shall make allocations of 
     the amount of the national new clean renewable energy bond 
     limitation described in paragraphs (2)(B) and (2)(C) among 
     qualified projects of governmental bodies and cooperative 
     electric companies, respectively, in such manner as the 
     Secretary determines appropriate.
       ``(d) Definitions.--For purposes of this section--
       ``(1) Qualified renewable energy facility.--The term 
     `qualified renewable energy facility' means a qualified 
     facility (as determined under section 45(d) without regard to 
     paragraphs (8) and (10) thereof and to any placed in service 
     date) owned by a public power provider, a governmental body, 
     or a cooperative electric company.
       ``(2) Public power provider.--The term `public power 
     provider' means a State utility with a service obligation, as 
     such terms are defined in section 217 of the Federal Power 
     Act (as in effect on the date of the enactment of this 
     paragraph).
       ``(3) Governmental body.--The term `governmental body' 
     means any State or Indian tribal government, or any political 
     subdivision thereof.
       ``(4) Cooperative electric company.--The term `cooperative 
     electric company' means a mutual or cooperative electric 
     company described in section 501(c)(12) or section 
     1381(a)(2)(C).
       ``(5) Clean renewable energy bond lender.--The term `clean 
     renewable energy bond lender' means a lender which is a 
     cooperative which is owned by, or has outstanding loans to, 
     100 or more cooperative electric companies and is in 
     existence on February 1, 2002, and shall include any 
     affiliated entity which is controlled by such lender.
       ``(6) Qualified issuer.--The term `qualified issuer' means 
     a public power provider, a cooperative electric company, a 
     governmental body, a clean renewable energy bond lender, or a 
     not-for-profit electric utility which has received a loan or 
     loan guarantee under the Rural Electrification Act.''.
       (b) Conforming Amendments.--
       (1) Paragraph (1) of section 54A(d) is amended to read as 
     follows:
       ``(1) Qualified tax credit bond.--The term `qualified tax 
     credit bond' means--
       ``(A) a qualified forestry conservation bond, or
       ``(B) a new clean renewable energy bond,
     which is part of an issue that meets requirements of 
     paragraphs (2), (3), (4), (5), and (6).''.
       (2) Subparagraph (C) of section 54A(d)(2) is amended to 
     read as follows:
       ``(C) Qualified purpose.--For purposes of this paragraph, 
     the term `qualified purpose' means--
       ``(i) in the case of a qualified forestry conservation 
     bond, a purpose specified in section 54B(e), and
       ``(ii) in the case of a new clean renewable energy bond, a 
     purpose specified in section 54C(a)(1).''.
       (3) The table of sections for subpart I of part IV of 
     subchapter A of chapter 1 is amended by adding at the end the 
     following new item:

``Sec. 54C. Qualified clean renewable energy bonds.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to obligations issued after the date of the 
     enactment of this Act.

                 PART II--CARBON MITIGATION PROVISIONS

     SEC. 3111. EXPANSION AND MODIFICATION OF ADVANCED COAL 
                   PROJECT INVESTMENT CREDIT.

       (a) Modification of Credit Amount.--Section 48A(a) is 
     amended by striking ``and'' at the end of paragraph (1), by 
     striking the period at the end of paragraph (2) and inserting 
     ``, and'', and by adding at the end the following new 
     paragraph:
       ``(3) 30 percent of the qualified investment for such 
     taxable year in the case of projects described in clause 
     (iii) of subsection (d)(3)(B).''.
       (b) Expansion of Aggregate Credits.--Section 48A(d)(3)(A) 
     is amended by striking ``$1,300,000,000'' and inserting 
     ``$2,550,000,000''.
       (c) Authorization of Additional Projects.--
       (1) In general.--Subparagraph (B) of section 48A(d)(3) is 
     amended to read as follows:
       ``(B) Particular projects.--Of the dollar amount in 
     subparagraph (A), the Secretary is authorized to certify--
       ``(i) $800,000,000 for integrated gasification combined 
     cycle projects the application for which is submitted during 
     the period described in paragraph (2)(A)(i),
       ``(ii) $500,000,000 for projects which use other advanced 
     coal-based generation technologies the application for which 
     is submitted during the period described in paragraph 
     (2)(A)(i), and
       ``(iii) $1,250,000,000 for advanced coal-based generation 
     technology projects the application for which is submitted 
     during the period described in paragraph (2)(A)(ii).''.
       (2) Application period for additional projects.--
     Subparagraph (A) of section 48A(d)(2) is amended to read as 
     follows:
       ``(A) Application period.--Each applicant for certification 
     under this paragraph shall submit an application meeting the 
     requirements of subparagraph (B). An applicant may only 
     submit an application--
       ``(i) for an allocation from the dollar amount specified in 
     clause (i) or (ii) of paragraph (3)(B) during the 3-year 
     period beginning on the date the Secretary establishes the 
     program under paragraph (1), and
       ``(ii) for an allocation from the dollar amount specified 
     in paragraph (3)(B)(iii) during the 3-year period beginning 
     at the earlier of the termination of the period described in 
     clause (i) or the date prescribed by the Secretary.''.
       (3) Capture and sequestration of carbon dioxide emissions 
     requirement.--
       (A) In general.--Section 48A(e)(1) is amended by striking 
     ``and'' at the end of subparagraph (E), by striking the 
     period at the end of subparagraph (F) and inserting ``; 
     and'', and by adding at the end the following new 
     subparagraph:
       ``(G) in the case of any project the application for which 
     is submitted during the period described in subsection 
     (d)(2)(A)(ii), the project includes equipment which separates 
     and sequesters at least 65 percent (70 percent in the case of 
     an application for reallocated credits under subsection 
     (d)(4)) of such project's total carbon dioxide emissions.''.
       (B) Highest priority for projects which sequester carbon 
     dioxide emissions.--Section 48A(e)(3) is amended by striking 
     ``and'' at the end of subparagraph (A)(iii), by striking the 
     period at the end of subparagraph (B)(iii) and inserting ``, 
     and'', and by adding at the end the following new 
     subparagraph:
       ``(C) give highest priority to projects with the greatest 
     separation and sequestration percentage of total carbon 
     dioxide emissions.''.

[[Page S6037]]

       (C) Recapture of credit for failure to sequester.--Section 
     48A is amended by adding at the end the following new 
     subsection:
       ``(i) Recapture of Credit for Failure To Sequester.--The 
     Secretary shall provide for recapturing the benefit of any 
     credit allowable under subsection (a) with respect to any 
     project which fails to attain or maintain the separation and 
     sequestration requirements of subsection (e)(1)(G).''.
       (4) Additional priority for research partnerships.--Section 
     48A(e)(3)(B), as amended by paragraph (3)(B), is amended--
       (A) by striking ``and'' at the end of clause (ii),
       (B) by redesignating clause (iii) as clause (iv), and
       (C) by inserting after clause (ii) the following new 
     clause:
       ``(iii) applicant participants who have a research 
     partnership with an eligible educational institution (as 
     defined in section 529(e)(5)), and''.
       (5) Clerical amendment.--Section 48A(e)(3) is amended by 
     striking ``integrated gasification combined cycle'' in the 
     heading and inserting ``certain''.
       (d) Disclosure of Allocations.--Section 48A(d) is amended 
     by adding at the end the following new paragraph:
       ``(5) Disclosure of allocations.--The Secretary shall, upon 
     making a certification under this subsection or section 
     48B(d), publicly disclose the identity of the applicant and 
     the amount of the credit certified with respect to such 
     applicant.''.
       (e) Effective Dates.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall apply 
     to credits the application for which is submitted during the 
     period described in section 48A(d)(2)(A)(ii) of the Internal 
     Revenue Code of 1986 and which are allocated or reallocated 
     after the date of the enactment of this Act.
       (2) Disclosure of allocations.--The amendment made by 
     subsection (d) shall apply to certifications made after the 
     date of the enactment of this Act.
       (3) Clerical amendment.--The amendment made by subsection 
     (c)(5) shall take effect as if included in the amendment made 
     by section 1307(b) of the Energy Tax Incentives Act of 2005.

     SEC. 3112. EXPANSION AND MODIFICATION OF COAL GASIFICATION 
                   INVESTMENT CREDIT.

       (a) Modification of Credit Amount.--Section 48B(a) is 
     amended by inserting ``(30 percent in the case of credits 
     allocated under subsection (d)(1)(B))'' after ``20 percent''.
       (b) Expansion of Aggregate Credits.--Section 48B(d)(1) is 
     amended by striking ``shall not exceed $350,000,000'' and all 
     that follows and inserting ``shall not exceed--
       ``(A) $350,000,000, plus
       ``(B) $250,000,000 for qualifying gasification projects 
     that include equipment which separates and sequesters at 
     least 75 percent of such project's total carbon dioxide 
     emissions.''.
       (c) Recapture of Credit for Failure To Sequester.--Section 
     48B is amended by adding at the end the following new 
     subsection:
       ``(f) Recapture of Credit for Failure To Sequester.--The 
     Secretary shall provide for recapturing the benefit of any 
     credit allowable under subsection (a) with respect to any 
     project which fails to attain or maintain the separation and 
     sequestration requirements for such project under subsection 
     (d)(1).''.
       (d) Selection Priorities.--Section 48B(d) is amended by 
     adding at the end the following new paragraph:
       ``(4) Selection priorities.--In determining which 
     qualifying gasification projects to certify under this 
     section, the Secretary shall--
       ``(A) give highest priority to projects with the greatest 
     separation and sequestration percentage of total carbon 
     dioxide emissions, and
       ``(B) give high priority to applicant participants who have 
     a research partnership with an eligible educational 
     institution (as defined in section 529(e)(5)).''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to credits described in section 48B(d)(1)(B) of 
     the Internal Revenue Code of 1986 which are allocated or 
     reallocated after the date of the enactment of this Act.

     SEC. 3113. TEMPORARY INCREASE IN COAL EXCISE TAX.

       Paragraph (2) of section 4121(e) is amended--
       (1) by striking ``January 1, 2014'' in subparagraph (A) and 
     inserting ``December 31, 2018'', and
       (2) by striking ``January 1 after 1981'' in subparagraph 
     (B) and inserting ``December 31 after 2007''.

     SEC. 3114. SPECIAL RULES FOR REFUND OF THE COAL EXCISE TAX TO 
                   CERTAIN COAL PRODUCERS AND EXPORTERS.

       (a) Refund.--
       (1) Coal producers.--
       (A) In general.--Notwithstanding subsections (a)(1) and (c) 
     of section 6416 and section 6511 of the Internal Revenue Code 
     of 1986, if--
       (i) a coal producer establishes that such coal producer, or 
     a party related to such coal producer, exported coal produced 
     by such coal producer to a foreign country or shipped coal 
     produced by such coal producer to a possession of the United 
     States, or caused such coal to be exported or shipped, the 
     export or shipment of which was other than through an 
     exporter who meets the requirements of paragraph (2),
       (ii) such coal producer filed an excise tax return on or 
     after October 1, 1990, and on or before the date of the 
     enactment of this Act, and
       (iii) such coal producer files a claim for refund with the 
     Secretary not later than the close of the 30-day period 
     beginning on the date of the enactment of this Act,
     then the Secretary shall pay to such coal producer an amount 
     equal to the tax paid under section 4121 of such Code on such 
     coal exported or shipped by the coal producer or a party 
     related to such coal producer, or caused by the coal producer 
     or a party related to such coal producer to be exported or 
     shipped.
       (B) Special rules for certain taxpayers.--For purposes of 
     this section--
       (i) In general.--If a coal producer or a party related to a 
     coal producer has received a judgment described in clause 
     (iii), such coal producer shall be deemed to have established 
     the export of coal to a foreign country or shipment of coal 
     to a possession of the United States under subparagraph 
     (A)(i).
       (ii) Amount of payment.--If a taxpayer described in clause 
     (i) is entitled to a payment under subparagraph (A), the 
     amount of such payment shall be reduced by any amount paid 
     pursuant to the judgment described in clause (iii).
       (iii) Judgment described.--A judgment is described in this 
     subparagraph if such judgment--

       (I) is made by a court of competent jurisdiction within the 
     United States,
       (II) relates to the constitutionality of any tax paid on 
     exported coal under section 4121 of the Internal Revenue Code 
     of 1986, and
       (III) is in favor of the coal producer or the party related 
     to the coal producer.

       (2) Exporters.--Notwithstanding subsections (a)(1) and (c) 
     of section 6416 and section 6511 of the Internal Revenue Code 
     of 1986, and a judgment described in paragraph (1)(B)(iii) of 
     this subsection, if--
       (A) an exporter establishes that such exporter exported 
     coal to a foreign country or shipped coal to a possession of 
     the United States, or caused such coal to be so exported or 
     shipped,
       (B) such exporter filed a tax return on or after October 1, 
     1990, and on or before the date of the enactment of this Act, 
     and
       (C) such exporter files a claim for refund with the 
     Secretary not later than the close of the 30-day period 
     beginning on the date of the enactment of this Act,
     then the Secretary shall pay to such exporter an amount equal 
     to $0.825 per ton of such coal exported by the exporter or 
     caused to be exported or shipped, or caused to be exported or 
     shipped, by the exporter.
       (b) Limitations.--Subsection (a) shall not apply with 
     respect to exported coal if a settlement with the Federal 
     Government has been made with and accepted by, the coal 
     producer, a party related to such coal producer, or the 
     exporter, of such coal, as of the date that the claim is 
     filed under this section with respect to such exported coal. 
     For purposes of this subsection, the term ``settlement with 
     the Federal Government'' shall not include any settlement or 
     stipulation entered into as of the date of the enactment of 
     this Act, the terms of which contemplate a judgment 
     concerning which any party has reserved the right to file an 
     appeal, or has filed an appeal.
       (c) Subsequent Refund Prohibited.--No refund shall be made 
     under this section to the extent that a credit or refund of 
     such tax on such exported or shipped coal has been paid to 
     any person.
       (d) Definitions.--For purposes of this section--
       (1) Coal producer.--The term ``coal producer'' means the 
     person in whom is vested ownership of the coal immediately 
     after the coal is severed from the ground, without regard to 
     the existence of any contractual arrangement for the sale or 
     other disposition of the coal or the payment of any royalties 
     between the producer and third parties. The term includes any 
     person who extracts coal from coal waste refuse piles or from 
     the silt waste product which results from the wet washing (or 
     similar processing) of coal.
       (2) Exporter.--The term ``exporter'' means a person, other 
     than a coal producer, who does not have a contract, fee 
     arrangement, or any other agreement with a producer or seller 
     of such coal to export or ship such coal to a third party on 
     behalf of the producer or seller of such coal and--
       (A) is indicated in the shipper's export declaration or 
     other documentation as the exporter of record, or
       (B) actually exported such coal to a foreign country or 
     shipped such coal to a possession of the United States, or 
     caused such coal to be so exported or shipped.
       (3) Related party.--The term ``a party related to such coal 
     producer'' means a person who--
       (A) is related to such coal producer through any degree of 
     common management, stock ownership, or voting control,
       (B) is related (within the meaning of section 144(a)(3) of 
     the Internal Revenue Code of 1986) to such coal producer, or
       (C) has a contract, fee arrangement, or any other agreement 
     with such coal producer to sell such coal to a third party on 
     behalf of such coal producer.
       (4) Secretary.--The term ``Secretary'' means the Secretary 
     of Treasury or the Secretary's designee.
       (e) Timing of Refund.--With respect to any claim for refund 
     filed pursuant to this section, the Secretary shall determine 
     whether the requirements of this section are met not later 
     than 180 days after such claim is filed. If the Secretary 
     determines that the

[[Page S6038]]

     requirements of this section are met, the claim for refund 
     shall be paid not later than 180 days after the Secretary 
     makes such determination.
       (f) Interest.--Any refund paid pursuant to this section 
     shall be paid by the Secretary with interest from the date of 
     overpayment determined by using the overpayment rate and 
     method under section 6621 of the Internal Revenue Code of 
     1986.
       (g) Denial of Double Benefit.--The payment under subsection 
     (a) with respect to any coal shall not exceed--
       (1) in the case of a payment to a coal producer, the amount 
     of tax paid under section 4121 of the Internal Revenue Code 
     of 1986 with respect to such coal by such coal producer or a 
     party related to such coal producer, and
       (2) in the case of a payment to an exporter, an amount 
     equal to $0.825 per ton with respect to such coal exported by 
     the exporter or caused to be exported by the exporter.
       (h) Application of Section.--This section applies only to 
     claims on coal exported or shipped on or after October 1, 
     1990, through the date of the enactment of this Act.
       (i) Standing Not Conferred.--
       (1) Exporters.--With respect to exporters, this section 
     shall not confer standing upon an exporter to commence, or 
     intervene in, any judicial or administrative proceeding 
     concerning a claim for refund by a coal producer of any 
     Federal or State tax, fee, or royalty paid by the coal 
     producer.
       (2) Coal producers.--With respect to coal producers, this 
     section shall not confer standing upon a coal producer to 
     commence, or intervene in, any judicial or administrative 
     proceeding concerning a claim for refund by an exporter of 
     any Federal or State tax, fee, or royalty paid by the 
     producer and alleged to have been passed on to an exporter.

     SEC. 3115. CARBON AUDIT OF THE TAX CODE.

       (a) Study.--The Secretary of the Treasury shall enter into 
     an agreement with the National Academy of Sciences to 
     undertake a comprehensive review of the Internal Revenue Code 
     of 1986 to identify the types of and specific tax provisions 
     that have the largest effects on carbon and other greenhouse 
     gas emissions and to estimate the magnitude of those effects.
       (b) Report.--Not later than 2 years after the date of 
     enactment of this Act, the National Academy of Sciences shall 
     submit to Congress a report containing the results of study 
     authorized under this section.
       (c) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $1,500,000 for 
     the period of fiscal years 2008 and 2009.

    Subtitle B--Transportation and Domestic Fuel Security Provisions

     SEC. 3121. INCLUSION OF CELLULOSIC BIOFUEL IN BONUS 
                   DEPRECIATION FOR BIOMASS ETHANOL PLANT 
                   PROPERTY.

       (a) In General.--Paragraph (3) of section 168(l) is amended 
     to read as follows:
       ``(3) Cellulosic biofuel.--The term `cellulosic biofuel' 
     means any liquid fuel which is produced from any 
     lignocellulosic or hemicellulosic matter that is available on 
     a renewable or recurring basis.''.
       (b) Conforming Amendments.--Subsection (l) of section 168 
     is amended--
       (1) by striking ``cellulosic biomass ethanol'' each place 
     it appears and inserting ``cellulosic biofuel'',
       (2) by striking ``Cellulosic Biomass Ethanol'' in the 
     heading of such subsection and inserting ``Cellulosic 
     Biofuel'', and
       (3) by striking ``cellulosic biomass ethanol'' in the 
     heading of paragraph (2) thereof and inserting ``cellulosic 
     biofuel''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after the date of 
     the enactment of this Act, in taxable years ending after such 
     date.

     SEC. 3122. CREDITS FOR BIODIESEL AND RENEWABLE DIESEL.

       (a) In General.--Sections 40A(g), 6426(c)(6), and 
     6427(e)(5)(B) are each amended by striking ``December 31, 
     2008'' and inserting ``December 31, 2009''.
       (b) Increase in Rate of Credit.--
       (1) Income tax credit.--Paragraphs (1)(A) and (2)(A) of 
     section 40A(b) are each amended by striking ``50 cents'' and 
     inserting ``$1.00''.
       (2) Excise tax credit.--Paragraph (2) of section 6426(c) is 
     amended to read as follows:
       ``(2) Applicable amount.--For purposes of this subsection, 
     the applicable amount is $1.00.''.
       (3) Conforming amendments.--
       (A) Subsection (b) of section 40A is amended by striking 
     paragraph (3) and by redesignating paragraphs (4) and (5) as 
     paragraphs (3) and (4), respectively.
       (B) Paragraph (2) of section 40A(f) is amended to read as 
     follows:
       ``(2) Exception.--Subsection (b)(4) shall not apply with 
     respect to renewable diesel.''.
       (C) Paragraphs (2) and (3) of section 40A(e) are each 
     amended by striking ``subsection (b)(5)(C)'' and inserting 
     ``subsection (b)(4)(C)''.
       (D) Clause (ii) of section 40A(d)(3)(C) is amended by 
     striking ``subsection (b)(5)(B)'' and inserting ``subsection 
     (b)(4)(B)''.
       (c) Uniform Treatment of Diesel Produced From Biomass.--
     Paragraph (3) of section 40A(f) is amended--
       (1) by striking ``diesel fuel'' and inserting ``liquid 
     fuel'',
       (2) by striking ``using a thermal depolymerization 
     process'', and
       (3) by striking ``or D396'' in subparagraph (B) and 
     inserting ``, D396, or other equivalent standard approved by 
     the Secretary''.
       (d) Coproduction of Renewable Diesel With Petroleum 
     Feedstock.--
       (1) In general.--Paragraph (3) of section 40A(f) (defining 
     renewable diesel) is amended by adding at the end the 
     following new sentence: ``Such term does not include any fuel 
     derived from coprocessing biomass with a feedstock which is 
     not biomass. For purposes of this paragraph, the term 
     `biomass' has the meaning given such term by section 
     45K(c)(3).''.
       (2) Conforming amendment.--Paragraph (3) of section 40A(f) 
     is amended by striking ``(as defined in section 45K(c)(3))''.
       (e) Eligibility of Certain Aviation Fuel.--Paragraph (3) of 
     section 40A(f) (defining renewable diesel) is amended by 
     adding at the end the following: ``The term `renewable 
     diesel' also means fuel derived from biomass which meets the 
     requirements of a Department of Defense specification for 
     military jet fuel or an American Society of Testing and 
     Materials specification for aviation turbine fuel.''.
       (f) Effective Date.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall apply 
     to fuel produced, and sold or used, after December 31, 2008.
       (2) Coproduction of renewable diesel with petroleum 
     feedstock.--The amendments made by subsection (d) shall apply 
     to fuel produced, and sold or used, after the date of the 
     enactment of this Act.

     SEC. 3123. CLARIFICATION THAT CREDITS FOR FUEL ARE DESIGNED 
                   TO PROVIDE AN INCENTIVE FOR UNITED STATES 
                   PRODUCTION.

       (a) Alcohol Fuels Credit.--Paragraph (6) of section 40(d) 
     is amended to read as follows:
       ``(6) Limitation to alcohol with connection to the united 
     states.--No credit shall be determined under this section 
     with respect to any alcohol which is produced outside the 
     United States for use as a fuel outside the United States. 
     For purposes of this paragraph, the term `United States' 
     includes any possession of the United States.''.
       (b) Biodiesel Fuels Credit.--Subsection (d) of section 40A 
     is amended by adding at the end the following new paragraph:
       ``(5) Limitation to biodiesel with connection to the united 
     states.--No credit shall be determined under this section 
     with respect to any biodiesel which is produced outside the 
     United States for use as a fuel outside the United States. 
     For purposes of this paragraph, the term `United States' 
     includes any possession of the United States.''.
       (c) Excise Tax Credit.--
       (1) In general.--Section 6426 is amended by adding at the 
     end the following new subsection:
       ``(i) Limitation to Fuels With Connection to the United 
     States.--
       ``(1) Alcohol.--No credit shall be determined under this 
     section with respect to any alcohol which is produced outside 
     the United States for use as a fuel outside the United 
     States.
       ``(2) Biodiesel and alternative fuels.--No credit shall be 
     determined under this section with respect to any biodiesel 
     or alternative fuel which is produced outside the United 
     States for use as a fuel outside the United States.

     For purposes of this subsection, the term `United States' 
     includes any possession of the United States.''.
       (2) Conforming amendment.--Subsection (e) of section 6427 
     is amended by redesignating paragraph (5) as paragraph (6) 
     and by inserting after paragraph (4) the following new 
     paragraph:
       ``(5) Limitation to fuels with connection to the united 
     states.--No amount shall be payable under paragraph (1) or 
     (2) with respect to any mixture or alternative fuel if credit 
     is not allowed with respect to such mixture or alternative 
     fuel by reason of section 6426(i).''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to claims for credit or payment made on or after 
     May 15, 2008.

     SEC. 3124. CREDIT FOR NEW QUALIFIED PLUG-IN ELECTRIC DRIVE 
                   MOTOR VEHICLES.

       (a) In General.--Subpart B of part IV of subchapter A of 
     chapter 1 is amended by adding at the end the following new 
     section:

     ``SEC. 30D. NEW QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR 
                   VEHICLES.

       ``(a) Allowance of Credit.--There shall be allowed as a 
     credit against the tax imposed by this chapter for the 
     taxable year an amount equal to the sum of the credit amounts 
     determined under subsection (b) with respect to each new 
     qualified plug-in electric drive motor vehicle placed in 
     service by the taxpayer during the taxable year.
       ``(b) Per Vehicle Dollar Limitation.--
       ``(1) In general.--The amount determined under this 
     subsection with respect to any new qualified plug-in electric 
     drive motor vehicle is the sum of the amounts determined 
     under paragraphs (2) and (3) with respect to such vehicle.
       ``(2) Base amount.--The amount determined under this 
     paragraph is $3,000.
       ``(3) Battery capacity.--In the case of a vehicle which 
     draws propulsion energy from a battery with not less than 5 
     kilowatt hours of capacity, the amount determined under this 
     paragraph is $200, plus $200 for each kilowatt hour of 
     capacity in excess of 5 kilowatt hours. The amount determined 
     under this paragraph shall not exceed $2,000.
       ``(c) Application With Other Credits.--
       ``(1) Business credit treated as part of general business 
     credit.--So much of the

[[Page S6039]]

     credit which would be allowed under subsection (a) for any 
     taxable year (determined without regard to this subsection) 
     that is attributable to property of a character subject to an 
     allowance for depreciation shall be treated as a credit 
     listed in section 38(b) for such taxable year (and not 
     allowed under subsection (a)).
       ``(2) Personal credit.--
       ``(A) In general.--For purposes of this title, the credit 
     allowed under subsection (a) for any taxable year (determined 
     after application of paragraph (1)) shall be treated as a 
     credit allowable under subpart A for such taxable year.
       ``(B) Limitation based on amount of tax.--In the case of a 
     taxable year to which section 26(a)(2) does not apply, the 
     credit allowed under subsection (a) for any taxable year 
     (determined after application of paragraph (1)) shall not 
     exceed the excess of--
       ``(i) the sum of the regular tax liability (as defined in 
     section 26(b)) plus the tax imposed by section 55, over
       ``(ii) the sum of the credits allowable under subpart A 
     (other than this section and sections 23 and 25D) and section 
     27 for the taxable year.
       ``(d) New Qualified Plug-In Electric Drive Motor Vehicle.--
     For purposes of this section--
       ``(1) In general.--The term `new qualified plug-in electric 
     drive motor vehicle' means a motor vehicle (as defined in 
     section 30(c)(2))--
       ``(A) the original use of which commences with the 
     taxpayer,
       ``(B) which is acquired for use or lease by the taxpayer 
     and not for resale,
       ``(C) which is made by a manufacturer,
       ``(D) which has a gross vehicle weight rating of less than 
     14,000 pounds,
       ``(E) which has received a certificate of conformity under 
     the Clean Air Act and meets or exceeds the Bin 5 Tier II 
     emission standard established in regulations prescribed by 
     the Administrator of the Environmental Protection Agency 
     under section 202(i) of the Clean Air Act for that make and 
     model year vehicle, and
       ``(F) which is propelled to a significant extent by an 
     electric motor which draws electricity from a battery which--
       ``(i) has a capacity of not less than 4 kilowatt hours, and
       ``(ii) is capable of being recharged from an external 
     source of electricity.
       ``(2) Exception.--The term `new qualified plug-in electric 
     drive motor vehicle' shall not include any vehicle which is 
     not a passenger automobile or light truck if such vehicle has 
     a gross vehicle weight rating of less than 8,500 pounds.
       ``(3) Other terms.--The terms `passenger automobile', 
     `light truck', and `manufacturer' have the meanings given 
     such terms in regulations prescribed by the Administrator of 
     the Environmental Protection Agency for purposes of the 
     administration of title II of the Clean Air Act (42 U.S.C. 
     7521 et seq.).
       ``(4) Battery capacity.--The term `capacity' means, with 
     respect to any battery, the quantity of electricity which the 
     battery is capable of storing, expressed in kilowatt hours, 
     as measured from a 100 percent state of charge to a 0 percent 
     state of charge.
       ``(e) Limitation on Number of New Qualified Plug-In 
     Electric Drive Motor Vehicles Eligible for Credit.--
       ``(1) In general.--In the case of a new qualified plug-in 
     electric drive motor vehicle sold during the phaseout period, 
     only the applicable percentage of the credit otherwise 
     allowable under subsection (a) shall be allowed.
       ``(2) Phaseout period.--For purposes of this subsection, 
     the phaseout period is the period beginning with the second 
     calendar quarter following the calendar quarter which 
     includes the first date on which the number of new qualified 
     plug-in electric drive motor vehicles manufactured by the 
     manufacturer of the vehicle referred to in paragraph (1) sold 
     for use in the United States after the date of the enactment 
     of this section, is at least 60,000.
       ``(3) Applicable percentage.--For purposes of paragraph 
     (1), the applicable percentage is--
       ``(A) 50 percent for the first 2 calendar quarters of the 
     phaseout period,
       ``(B) 25 percent for the 3d and 4th calendar quarters of 
     the phaseout period, and
       ``(C) 0 percent for each calendar quarter thereafter.
       ``(4) Controlled groups.--Rules similar to the rules of 
     section 30B(f)(4) shall apply for purposes of this 
     subsection.
       ``(f) Special Rules.--
       ``(1) Basis reduction.--The basis of any property for which 
     a credit is allowable under subsection (a) shall be reduced 
     by the amount of such credit (determined without regard to 
     subsection (c)).
       ``(2) Recapture.--The Secretary shall, by regulations, 
     provide for recapturing the benefit of any credit allowable 
     under subsection (a) with respect to any property which 
     ceases to be property eligible for such credit.
       ``(3) Property used outside united states, etc., not 
     qualified.--No credit shall be allowed under subsection (a) 
     with respect to any property referred to in section 50(b)(1) 
     or with respect to the portion of the cost of any property 
     taken into account under section 179.
       ``(4) Election not to take credit.--No credit shall be 
     allowed under subsection (a) for any vehicle if the taxpayer 
     elects to not have this section apply to such vehicle.
       ``(5) Property used by tax-exempt entity; interaction with 
     air quality and motor vehicle safety standards.--Rules 
     similar to the rules of paragraphs (6) and (10) of section 
     30B(h) shall apply for purposes of this section.''.
       (b) Coordination With Alternative Motor Vehicle Credit.--
     Section 30B(d)(3) is amended by adding at the end the 
     following new subparagraph:
       ``(D) Exclusion of plug-in vehicles.--Any vehicle with 
     respect to which a credit is allowable under section 30D 
     (determined without regard to subsection (c) thereof) shall 
     not be taken into account under this section.''.
       (c) Credit Made Part of General Business Credit.--Section 
     38(b) is amended--
       (1) by striking ``and'' each place it appears at the end of 
     any paragraph,
       (2) by striking ``plus'' each place it appears at the end 
     of any paragraph,
       (3) by striking the period at the end of paragraph (32) and 
     inserting ``, plus'', and
       (4) by adding at the end the following new paragraph:
       ``(33) the portion of the new qualified plug-in electric 
     drive motor vehicle credit to which section 30D(c)(1) 
     applies.''.
       (d) Conforming Amendments.--
       (1)(A) Section 24(b)(3)(B), as amended by section 104, is 
     amended by striking ``and 25D'' and inserting ``25D, and 
     30D''.
       (B) Section 25(e)(1)(C)(ii) is amended by inserting 
     ``30D,'' after ``25D,''.
       (C) Section 25B(g)(2), as amended by section 104, is 
     amended by striking ``and 25D'' and inserting ``, 25D, and 
     30D''.
       (D) Section 26(a)(1), as amended by section 104, is amended 
     by striking ``and 25D'' and inserting ``25D, and 30D''.
       (E) Section 1400C(d)(2) is amended by striking ``and 25D'' 
     and inserting ``25D, and 30D''.
       (2) Section 1016(a) is amended by striking ``and'' at the 
     end of paragraph (35), by striking the period at the end of 
     paragraph (36) and inserting ``, and'', and by adding at the 
     end the following new paragraph:
       ``(37) to the extent provided in section 30D(f)(1).''.
       (3) Section 6501(m) is amended by inserting ``30D(f)(4),'' 
     after ``30C(e)(5),''.
       (4) The table of sections for subpart B of part IV of 
     subchapter A of chapter 1 is amended by adding at the end the 
     following new item:

``Sec. 30D. New qualified plug-in electric drive motor vehicles.''.
       (e) Treatment of Alternative Motor Vehicle Credit as a 
     Personal Credit.--
       (1) In general.--Paragraph (2) of section 30B(g) is amended 
     to read as follows:
       ``(2) Personal credit.--The credit allowed under subsection 
     (a) for any taxable year (after application of paragraph (1)) 
     shall be treated as a credit allowable under subpart A for 
     such taxable year.''.
       (2) Conforming amendments.--
       (A) Subparagraph (A) of section 30C(d)(2) is amended by 
     striking ``sections 27, 30, and 30B'' and inserting 
     ``sections 27 and 30''.
       (B) Paragraph (3) of section 55(c) is amended by striking 
     ``30B(g)(2),''.
       (f) Effective Date.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall apply 
     to taxable years beginning after December 31, 2008.
       (2) Treatment of alternative motor vehicle credit as 
     personal credit.--The amendments made by subsection (e) shall 
     apply to taxable years beginning after December 31, 2007.
       (g) Application of EGTRRA Sunset.--The amendment made by 
     subsection (d)(1)(A) shall be subject to title IX of the 
     Economic Growth and Tax Relief Reconciliation Act of 2001 in 
     the same manner as the provision of such Act to which such 
     amendment relates.

     SEC. 3125. EXCLUSION FROM HEAVY TRUCK TAX FOR IDLING 
                   REDUCTION UNITS AND ADVANCED INSULATION.

       (a) In General.--Section 4053 is amended by adding at the 
     end the following new paragraphs:
       ``(9) Idling reduction device.--Any device or system of 
     devices which--
       ``(A) is designed to provide to a vehicle those services 
     (such as heat, air conditioning, or electricity) that would 
     otherwise require the operation of the main drive engine 
     while the vehicle is temporarily parked or remains stationary 
     using one or more devices affixed to a tractor, and
       ``(B) is determined by the Administrator of the 
     Environmental Protection Agency, in consultation with the 
     Secretary of Energy and the Secretary of Transportation, to 
     reduce idling of such vehicle at a motor vehicle rest stop or 
     other location where such vehicles are temporarily parked or 
     remain stationary.
       ``(10) Advanced insulation.--Any insulation that has an R 
     value of not less than R35 per inch.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to sales or installations after the date of the 
     enactment of this Act.

     SEC. 3126. RESTRUCTURING OF NEW YORK LIBERTY ZONE TAX 
                   CREDITS.

       (a) In General.--Part I of subchapter Y of chapter 1 is 
     amended by redesignating section 1400L as section 1400K and 
     by adding at the end the following new section:

     ``SEC. 1400L. NEW YORK LIBERTY ZONE TAX CREDITS.

       ``(a) In General.--In the case of a New York Liberty Zone 
     governmental unit, there shall be allowed as a credit against 
     any taxes imposed for any payroll period by section 3402 for 
     which such governmental unit is liable under section 3403 an 
     amount equal to so

[[Page S6040]]

     much of the portion of the qualifying project expenditure 
     amount allocated under subsection (b)(3) to such governmental 
     unit for the calendar year as is allocated by such 
     governmental unit to such period under subsection (b)(4).
       ``(b) Qualifying Project Expenditure Amount.--For purposes 
     of this section--
       ``(1) In general.--The term `qualifying project expenditure 
     amount' means, with respect to any calendar year, the sum 
     of--
       ``(A) the total expenditures paid or incurred during such 
     calendar year by all New York Liberty Zone governmental units 
     and the Port Authority of New York and New Jersey for any 
     portion of qualifying projects located wholly within the City 
     of New York, New York, and
       ``(B) any such expenditures--
       ``(i) paid or incurred in any preceding calendar year which 
     begins after the date of enactment of this section, and
       ``(ii) not previously allocated under paragraph (3).
       ``(2) Qualifying project.--The term `qualifying project' 
     means any transportation infrastructure project, including 
     highways, mass transit systems, railroads, airports, ports, 
     and waterways, in or connecting with the New York Liberty 
     Zone (as defined in section 1400K(h)), which is designated as 
     a qualifying project under this section jointly by the 
     Governor of the State of New York and the Mayor of the City 
     of New York, New York.
       ``(3) General allocation.--
       ``(A) In general.--The Governor of the State of New York 
     and the Mayor of the City of New York, New York, shall 
     jointly allocate to each New York Liberty Zone governmental 
     unit the portion of the qualifying project expenditure amount 
     which may be taken into account by such governmental unit 
     under subsection (a) for any calendar year in the credit 
     period.
       ``(B) Aggregate limit.--The aggregate amount which may be 
     allocated under subparagraph (A) for all calendar years in 
     the credit period shall not exceed $2,000,000,000.
       ``(C) Annual limit.--The aggregate amount which may be 
     allocated under subparagraph (A) for any calendar year in the 
     credit period shall not exceed the sum of--
       ``(i) $115,000,000 ($425,000,000 in the case of the last 2 
     years in the credit period), plus
       ``(ii) the aggregate amount authorized to be allocated 
     under this paragraph for all preceding calendar years in the 
     credit period which was not so allocated.
       ``(D) Unallocated amounts at end of credit period.--If, as 
     of the close of the credit period, the amount under 
     subparagraph (B) exceeds the aggregate amount allocated under 
     subparagraph (A) for all calendar years in the credit period, 
     the Governor of the State of New York and the Mayor of the 
     City of New York, New York, may jointly allocate to New York 
     Liberty Zone governmental units for any calendar year in the 
     5-year period following the credit period an amount equal 
     to--
       ``(i) the lesser of--

       ``(I) such excess, or
       ``(II) the qualifying project expenditure amount for such 
     calendar year, reduced by

       ``(ii) the aggregate amount allocated under this 
     subparagraph for all preceding calendar years.
       ``(4) Allocation to payroll periods.--Each New York Liberty 
     Zone governmental unit which has been allocated a portion of 
     the qualifying project expenditure amount under paragraph (3) 
     for a calendar year may allocate such portion to payroll 
     periods beginning in such calendar year as such governmental 
     unit determines appropriate.
       ``(c) Carryover of Unused Allocations.--
       ``(1) In general.--Except as provided in paragraph (2), if 
     the amount allocated under subsection (b)(3) to a New York 
     Liberty Zone governmental unit for any calendar year exceeds 
     the aggregate taxes imposed by section 3402 for which such 
     governmental unit is liable under section 3403 for periods 
     beginning in such year, such excess shall be carried to the 
     succeeding calendar year and added to the allocation of such 
     governmental unit for such succeeding calendar year.
       ``(2) Reallocation.--If a New York Liberty Zone 
     governmental unit does not use an amount allocated to it 
     under subsection (b)(3) within the time prescribed by the 
     Governor of the State of New York and the Mayor of the City 
     of New York, New York, then such amount shall after such time 
     be treated for purposes of subsection (b)(3) in the same 
     manner as if it had never been allocated.
       ``(d) Definitions and Special Rules.--For purposes of this 
     section--
       ``(1) Credit period.--The term `credit period' means the 
     12-year period beginning on January 1, 2009.
       ``(2) New york liberty zone governmental unit.--The term 
     `New York Liberty Zone governmental unit' means--
       ``(A) the State of New York,
       ``(B) the City of New York, New York, and
       ``(C) any agency or instrumentality of such State or City.
       ``(3) Treatment of funds.--Any expenditure for a qualifying 
     project taken into account for purposes of the credit under 
     this section shall be considered State and local funds for 
     the purpose of any Federal program.
       ``(4) Treatment of credit amounts for purposes of 
     withholding taxes.--For purposes of this title, a New York 
     Liberty Zone governmental unit shall be treated as having 
     paid to the Secretary, on the day on which wages are paid to 
     employees, an amount equal to the amount of the credit 
     allowed to such entity under subsection (a) with respect to 
     such wages, but only if such governmental unit deducts and 
     withholds wages for such payroll period under section 3401 
     (relating to wage withholding).
       ``(e) Reporting.--The Governor of the State of New York and 
     the Mayor of the City of New York, New York, shall jointly 
     submit to the Secretary an annual report--
       ``(1) which certifies--
       ``(A) the qualifying project expenditure amount for the 
     calendar year, and
       ``(B) the amount allocated to each New York Liberty Zone 
     governmental unit under subsection (b)(3) for the calendar 
     year, and
       ``(2) includes such other information as the Secretary may 
     require to carry out this section.
       ``(f) Guidance.--The Secretary may prescribe such guidance 
     as may be necessary or appropriate to ensure compliance with 
     the purposes of this section.''.
       (b) Termination of Special Allowance and Expensing.--
     Subparagraph (A) of section 1400K(b)(2), as redesignated by 
     subsection (a), is amended by striking the parenthetical 
     therein and inserting ``(in the case of nonresidential real 
     property and residential rental property, the date of the 
     enactment of the Federal Housing Finance Regulatory Reform 
     Act of 2008 or, if acquired pursuant to a binding contract in 
     effect on such enactment date, December 31, 2009)''.
       (c) Conforming Amendments.--
       (1) Section 38(c)(3)(B) is amended by striking ``section 
     1400L(a)'' and inserting ``section 1400K(a)''.
       (2) Section 168(k)(2)(D)(ii) is amended by striking 
     ``section 1400L(c)(2)'' and inserting ``section 
     1400K(c)(2)''.
       (3) The table of sections for part I of subchapter Y of 
     chapter 1 is amended by redesignating the item relating to 
     section 1400L as an item relating to section 1400K and by 
     inserting after such item the following new item:

``Sec. 1400L. New York Liberty Zone tax credits.''.
       (d) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.

     SEC. 3127. TRANSPORTATION FRINGE BENEFIT TO BICYCLE 
                   COMMUTERS.

       (a) In General.--Paragraph (1) of section 132(f) is amended 
     by adding at the end the following:
       ``(D) Any qualified bicycle commuting reimbursement.''.
       (b) Limitation on Exclusion.--Paragraph (2) of section 
     132(f) is amended by striking ``and'' at the end of 
     subparagraph (A), by striking the period at the end of 
     subparagraph (B) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(C) the applicable annual limitation in the case of any 
     qualified bicycle commuting reimbursement.''.
       (c) Definitions.--Paragraph (5) of section 132(f) is 
     amended by adding at the end the following:
       ``(F) Definitions related to bicycle commuting 
     reimbursement.--
       ``(i) Qualified bicycle commuting reimbursement.--The term 
     `qualified bicycle commuting reimbursement' means, with 
     respect to any calendar year, any employer reimbursement 
     during the 15-month period beginning with the first day of 
     such calendar year for reasonable expenses incurred by the 
     employee during such calendar year for the purchase of a 
     bicycle and bicycle improvements, repair, and storage, if 
     such bicycle is regularly used for travel between the 
     employee's residence and place of employment.
       ``(ii) Applicable annual limitation.--The term `applicable 
     annual limitation' means, with respect to any employee for 
     any calendar year, the product of $20 multiplied by the 
     number of qualified bicycle commuting months during such 
     year.
       ``(iii) Qualified bicycle commuting month.--The term 
     `qualified bicycle commuting month' means, with respect to 
     any employee, any month during which such employee--

       ``(I) regularly uses the bicycle for a substantial portion 
     of the travel between the employee's residence and place of 
     employment, and
       ``(II) does not receive any benefit described in 
     subparagraph (A), (B), or (C) of paragraph (1).''.

       (d) Constructive Receipt of Benefit.--Paragraph (4) of 
     section 132(f) is amended by inserting ``(other than a 
     qualified bicycle commuting reimbursement)'' after 
     ``qualified transportation fringe''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2008.

     SEC. 3128. ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY 
                   CREDIT.

       (a) Increase in Credit Amount.--Section 30C is amended--
       (1) by striking ``30 percent'' in subsection (a) and 
     inserting ``50 percent'', and
       (2) by striking ``$30,000'' in subsection (b)(1) and 
     inserting ``$50,000''.
       (b) Extension of Credit.--Paragraph (2) of section 30C(g) 
     is amended by striking ``December 31, 2009'' and inserting 
     ``December 31, 2010''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after the date of 
     the enactment of this Act, in taxable years ending after such 
     date.

[[Page S6041]]

       Subtitle C--Energy Conservation and Efficiency Provisions

     SEC. 3141. QUALIFIED ENERGY CONSERVATION BONDS.

       (a) In General.--Subpart I of part IV of subchapter A of 
     chapter 1, as amended by section 3106, is amended by adding 
     at the end the following new section:

     ``SEC. 54D. QUALIFIED ENERGY CONSERVATION BONDS.

       ``(a) Qualified Energy Conservation Bond.--For purposes of 
     this subchapter, the term `qualified energy conservation 
     bond' means any bond issued as part of an issue if--
       ``(1) 100 percent of the available project proceeds of such 
     issue are to be used for one or more qualified conservation 
     purposes,
       ``(2) the bond is issued by a State or local government, 
     and
       ``(3) the issuer designates such bond for purposes of this 
     section.
       ``(b) Reduced Credit Amount.--The annual credit determined 
     under section 54A(b) with respect to any qualified energy 
     conservation bond shall be 70 percent of the amount so 
     determined without regard to this subsection.
       ``(c) Limitation on Amount of Bonds Designated.--The 
     maximum aggregate face amount of bonds which may be 
     designated under subsection (a) by any issuer shall not 
     exceed the limitation amount allocated to such issuer under 
     subsection (e).
       ``(d) National Limitation on Amount of Bonds Designated.--
     There is a national qualified energy conservation bond 
     limitation of $3,000,000,000.
       ``(e) Allocations.--
       ``(1) In general.--The limitation applicable under 
     subsection (d) shall be allocated by the Secretary among the 
     States in proportion to the population of the States.
       ``(2) Allocations to largest local governments.--
       ``(A) In general.--In the case of any State in which there 
     is a large local government, each such local government shall 
     be allocated a portion of such State's allocation which bears 
     the same ratio to the State's allocation (determined without 
     regard to this subparagraph) as the population of such large 
     local government bears to the population of such State.
       ``(B) Allocation of unused limitation to state.--The amount 
     allocated under this subsection to a large local government 
     may be reallocated by such local government to the State in 
     which such local government is located.
       ``(C) Large local government.--For purposes of this 
     section, the term `large local government' means any 
     municipality or county if such municipality or county has a 
     population of 100,000 or more.
       ``(3) Allocation to issuers; restriction on private 
     activity bonds.--Any allocation under this subsection to a 
     State or large local government shall be allocated by such 
     State or large local government to issuers within the State 
     in a manner that results in not less than 70 percent of the 
     allocation to such State or large local government being used 
     to designate bonds which are not private activity bonds.
       ``(f) Qualified Conservation Purpose.--For purposes of this 
     section--
       ``(1) In general.--The term `qualified conservation 
     purpose' means any of the following:
       ``(A) Capital expenditures incurred for purposes of--
       ``(i) reducing energy consumption in publicly-owned 
     buildings by at least 20 percent,
       ``(ii) implementing green community programs,
       ``(iii) rural development involving the production of 
     electricity from renewable energy resources, or
       ``(iv) any qualified facility (as determined under section 
     45(d) without regard to paragraphs (8) and (10) thereof and 
     without regard to any placed in service date).
       ``(B) Expenditures with respect to research facilities, and 
     research grants, to support research in--
       ``(i) development of cellulosic ethanol or other nonfossil 
     fuels,
       ``(ii) technologies for the capture and sequestration of 
     carbon dioxide produced through the use of fossil fuels,
       ``(iii) increasing the efficiency of existing technologies 
     for producing nonfossil fuels,
       ``(iv) automobile battery technologies and other 
     technologies to reduce fossil fuel consumption in 
     transportation, or
       ``(v) technologies to reduce energy use in buildings.
       ``(C) Mass commuting facilities and related facilities that 
     reduce the consumption of energy, including expenditures to 
     reduce pollution from vehicles used for mass commuting.
       ``(D) Demonstration projects designed to promote the 
     commercialization of--
       ``(i) green building technology,
       ``(ii) conversion of agricultural waste for use in the 
     production of fuel or otherwise,
       ``(iii) advanced battery manufacturing technologies,
       ``(iv) technologies to reduce peak use of electricity, or
       ``(v) technologies for the capture and sequestration of 
     carbon dioxide emitted from combusting fossil fuels in order 
     to produce electricity.
       ``(E) Public education campaigns to promote energy 
     efficiency.
       ``(2) Special rules for private activity bonds.--For 
     purposes of this section, in the case of any private activity 
     bond, the term `qualified conservation purposes' shall not 
     include any expenditure which is not a capital expenditure.
       ``(g) Population.--
       ``(1) In general.--The population of any State or local 
     government shall be determined for purposes of this section 
     as provided in section 146(j) for the calendar year which 
     includes the date of the enactment of this section.
       ``(2) Special rule for counties.--In determining the 
     population of any county for purposes of this section, any 
     population of such county which is taken into account in 
     determining the population of any municipality which is a 
     large local government shall not be taken into account in 
     determining the population of such county.
       ``(h) Application to Indian Tribal Governments.--An Indian 
     tribal government shall be treated for purposes of this 
     section in the same manner as a large local government, 
     except that--
       ``(1) an Indian tribal government shall be treated for 
     purposes of subsection (e) as located within a State to the 
     extent of so much of the population of such government as 
     resides within such State, and
       ``(2) any bond issued by an Indian tribal government shall 
     be treated as a qualified energy conservation bond only if 
     issued as part of an issue the available project proceeds of 
     which are used for purposes for which such Indian tribal 
     government could issue bonds to which section 103(a) 
     applies.''.
       (b) Conforming Amendments.--
       (1) Paragraph (1) of section 54A(d), as amended by section 
     3106, is amended to read as follows:
       ``(1) Qualified tax credit bond.--The term `qualified tax 
     credit bond' means--
       ``(A) a qualified forestry conservation bond,
       ``(B) a new clean renewable energy bond, or
       ``(C) a qualified energy conservation bond,
     which is part of an issue that meets requirements of 
     paragraphs (2), (3), (4), (5), and (6).''.
       (2) Subparagraph (C) of section 54A(d)(2), as amended by 
     section 3106, is amended to read as follows:
       ``(C) Qualified purpose.--For purposes of this paragraph, 
     the term `qualified purpose' means--
       ``(i) in the case of a qualified forestry conservation 
     bond, a purpose specified in section 54B(e),
       ``(ii) in the case of a new clean renewable energy bond, a 
     purpose specified in section 54C(a)(1), and
       ``(iii) in the case of a qualified energy conservation 
     bond, a purpose specified in section 54D(a)(1).''.
       (3) The table of sections for subpart I of part IV of 
     subchapter A of chapter 1 is amended by adding at the end the 
     following new item:

``Sec. 54D. Qualified energy conservation bonds.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to obligations issued after the date of the 
     enactment of this Act.

     SEC. 3142. CREDIT FOR NONBUSINESS ENERGY PROPERTY.

       (a) Extension of Credit.--Section 25C(g) is amended by 
     striking ``December 31, 2007'' and inserting ``December 31, 
     2008''.
       (b) Qualified Biomass Fuel Property.--
       (1) In general.--Section 25C(d)(3) is amended--
       (A) by striking ``and'' at the end of subparagraph (D),
       (B) by striking the period at the end of subparagraph (E) 
     and inserting ``, and'', and
       (C) by adding at the end the following new subparagraph:
       ``(F) a stove which uses the burning of biomass fuel to 
     heat a dwelling unit located in the United States and used as 
     a residence by the taxpayer, or to heat water for use in such 
     a dwelling unit, and which has a thermal efficiency rating of 
     at least 75 percent.''.
       (2) Biomass fuel.--Section 25C(d) is amended by adding at 
     the end the following new paragraph:
       ``(6) Biomass fuel.--The term `biomass fuel' means any 
     plant-derived fuel available on a renewable or recurring 
     basis, including agricultural crops and trees, wood and wood 
     waste and residues (including wood pellets), plants 
     (including aquatic plants), grasses, residues, and fibers.''.
       (c) Coordination With Credit for Qualified Geothermal Heat 
     Pump Property Expenditures.--
       (1) In general.--Paragraph (3) of section 25C(d), as 
     amended by subsection (b), is amended by striking 
     subparagraph (C) and by redesignating subparagraphs (D), (E), 
     and (F) as subparagraphs (C), (D), and (E), respectively.
       (2) Conforming amendment.--Subparagraph (C) of section 
     25C(d)(2) is amended to read as follows:
       ``(C) Requirements and standards for air conditioners and 
     heat pumps.--The standards and requirements prescribed by the 
     Secretary under subparagraph (B) with respect to the energy 
     efficiency ratio (EER) for central air conditioners and 
     electric heat pumps--
       ``(i) shall require measurements to be based on published 
     data which is tested by manufacturers at 95 degrees 
     Fahrenheit, and
       ``(ii) may be based on the certified data of the Air 
     Conditioning and Refrigeration Institute that are prepared in 
     partnership with the Consortium for Energy Efficiency.''.
       (d) Modification of Qualified Energy Efficiency 
     Improvements.--
       (1) In general.--Paragraph (1) of section 25C(c) is amended 
     by inserting ``, or an asphalt roof with appropriate cooling 
     granules,'' before ``which meet the Energy Star program 
     requirements''.

[[Page S6042]]

       (2) Building envelope component.--Subparagraph (D) of 
     section 25C(c)(2) is amended--
       (A) by inserting ``or asphalt roof'' after ``metal roof'', 
     and
       (B) by inserting ``or cooling granules'' after ``pigmented 
     coatings''.
       (e) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made this section shall apply to expenditures made 
     after December 31, 2007.
       (2) Modification of qualified energy efficiency 
     improvements.--The amendments made by subsection (d) shall 
     apply to property placed in service after the date of the 
     enactment of this Act.

     SEC. 3143. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.

       Subsection (h) of section 179D is amended by striking 
     ``December 31, 2008'' and inserting ``December 31, 2013''.

     SEC. 3144. MODIFICATIONS OF ENERGY EFFICIENT APPLIANCE CREDIT 
                   FOR APPLIANCES PRODUCED AFTER 2007.

       (a) In General.--Subsection (b) of section 45M is amended 
     to read as follows:
       ``(b) Applicable Amount.--For purposes of subsection (a)--
       ``(1) Dishwashers.--The applicable amount is--
       ``(A) $45 in the case of a dishwasher which is manufactured 
     in calendar year 2008 or 2009 and which uses no more than 324 
     kilowatt hours per year and 5.8 gallons per cycle, and
       ``(B) $75 in the case of a dishwasher which is manufactured 
     in calendar year 2008, 2009, or 2010 and which uses no more 
     than 307 kilowatt hours per year and 5.0 gallons per cycle 
     (5.5 gallons per cycle for dishwashers designed for greater 
     than 12 place settings).
       ``(2) Clothes washers.--The applicable amount is--
       ``(A) $75 in the case of a residential top-loading clothes 
     washer manufactured in calendar year 2008 which meets or 
     exceeds a 1.72 modified energy factor and does not exceed a 
     8.0 water consumption factor,
       ``(B) $125 in the case of a residential top-loading clothes 
     washer manufactured in calendar year 2008 or 2009 which meets 
     or exceeds a 1.8 modified energy factor and does not exceed a 
     7.5 water consumption factor,
       ``(C) $150 in the case of a residential or commercial 
     clothes washer manufactured in calendar year 2008, 2009, or 
     2010 which meets or exceeds 2.0 modified energy factor and 
     does not exceed a 6.0 water consumption factor, and
       ``(D) $250 in the case of a residential or commercial 
     clothes washer manufactured in calendar year 2008, 2009, or 
     2010 which meets or exceeds 2.2 modified energy factor and 
     does not exceed a 4.5 water consumption factor.
       ``(3) Refrigerators.--The applicable amount is--
       ``(A) $50 in the case of a refrigerator which is 
     manufactured in calendar year 2008, and consumes at least 20 
     percent but not more than 22.9 percent less kilowatt hours 
     per year than the 2001 energy conservation standards,
       ``(B) $75 in the case of a refrigerator which is 
     manufactured in calendar year 2008 or 2009, and consumes at 
     least 23 percent but no more than 24.9 percent less kilowatt 
     hours per year than the 2001 energy conservation standards,
       ``(C) $100 in the case of a refrigerator which is 
     manufactured in calendar year 2008, 2009, or 2010, and 
     consumes at least 25 percent but not more than 29.9 percent 
     less kilowatt hours per year than the 2001 energy 
     conservation standards, and
       ``(D) $200 in the case of a refrigerator manufactured in 
     calendar year 2008, 2009, or 2010 and which consumes at least 
     30 percent less energy than the 2001 energy conservation 
     standards.''.
       (b) Eligible Production.--
       (1) Similar treatment for all appliances.--Subsection (c) 
     of section 45M is amended--
       (A) by striking paragraph (2),
       (B) by striking ``(1) In general'' and all that follows 
     through ``the eligible'' and inserting ``The eligible'',
       (C) by moving the text of such subsection in line with the 
     subsection heading, and
       (D) by redesignating subparagraphs (A) and (B) as 
     paragraphs (1) and (2), respectively, and by moving such 
     paragraphs 2 ems to the left.
       (2) Modification of base period.--Paragraph (2) of section 
     45M(c), as amended by paragraph (1), is amended by striking 
     ``3-calendar year'' and inserting ``2-calendar year''.
       (c) Types of Energy Efficient Appliances.--Subsection (d) 
     of section 45M (defining types of energy efficient 
     appliances) is amended to read as follows:
       ``(d) Types of Energy Efficient Appliance.--For purposes of 
     this section, the types of energy efficient appliances are--
       ``(1) dishwashers described in subsection (b)(1),
       ``(2) clothes washers described in subsection (b)(2), and
       ``(3) refrigerators described in subsection (b)(3).''.
       (d) Aggregate Credit Amount Allowed.--
       (1) Increase in limit.--Paragraph (1) of section 45M(e) is 
     amended to read as follows:
       ``(1) Aggregate credit amount allowed.--The aggregate 
     amount of credit allowed under subsection (a) with respect to 
     a taxpayer for any taxable year shall not exceed $75,000,000 
     reduced by the amount of the credit allowed under subsection 
     (a) to the taxpayer (or any predecessor) for all prior 
     taxable years beginning after December 31, 2007.''.
       (2) Exception for certain refrigerator and clothes 
     washers.--Paragraph (2) of section 45M(e) is amended to read 
     as follows:
       ``(2) Amount allowed for certain refrigerators and clothes 
     washers.--Refrigerators described in subsection (b)(3)(D) and 
     clothes washers described in subsection (b)(2)(D) shall not 
     be taken into account under paragraph (1).''.
       (e) Qualified Energy Efficient Appliances.--
       (1) In general.--Paragraph (1) of section 45M(f) (defining 
     qualified energy efficient appliance) is amended to read as 
     follows:
       ``(1) Qualified energy efficient appliance.--The term 
     `qualified energy efficient appliance' means--
       ``(A) any dishwasher described in subsection (b)(1),
       ``(B) any clothes washer described in subsection (b)(2), 
     and
       ``(C) any refrigerator described in subsection (b)(3).''.
       (2) Clothes washer.--Section 45M(f)(3) is amended by 
     inserting ``commercial'' before ``residential'' the second 
     place it appears.
       (3) Top-loading clothes washer.--Subsection (f) of section 
     45M is amended by redesignating paragraphs (4), (5), (6), and 
     (7) as paragraphs (5), (6), (7), and (8), respectively, and 
     by inserting after paragraph (3) the following new paragraph:
       ``(4) Top-loading clothes washer.--The term `top-loading 
     clothes washer' means a clothes washer which has the clothes 
     container compartment access located on the top of the 
     machine and which operates on a vertical axis.''.
       (4) Replacement of energy factor.--Section 45M(f)(6), as 
     redesignated by paragraph (3), is amended to read as follows:
       ``(6) Modified energy factor.--The term `modified energy 
     factor' means the modified energy factor established by the 
     Department of Energy for compliance with the Federal energy 
     conservation standard.''.
       (5) Gallons per cycle; water consumption factor.--Section 
     45M(f), as amended by paragraph (3), is amended by adding at 
     the end the following:
       ``(9) Gallons per cycle.--The term `gallons per cycle' 
     means, with respect to a dishwasher, the amount of water, 
     expressed in gallons, required to complete a normal cycle of 
     a dishwasher.
       ``(10) Water consumption factor.--The term `water 
     consumption factor' means, with respect to a clothes washer, 
     the quotient of the total weighted per-cycle water 
     consumption divided by the cubic foot (or liter) capacity of 
     the clothes washer.''.
       (f) Effective Date.--The amendments made by this section 
     shall apply to appliances produced after December 31, 2007.

     SEC. 3145. ACCELERATED RECOVERY PERIOD FOR DEPRECIATION OF 
                   SMART METERS AND SMART GRID SYSTEMS.

       (a) In General.--Section 168(e)(3)(D) is amended by 
     striking ``and'' at the end of clause (i), by striking the 
     period at the end of clause (ii) and inserting a comma, and 
     by inserting after clause (ii) the following new clauses:
       ``(iii) any qualified smart electric meter, and
       ``(iv) any qualified smart electric grid system.''.
       (b) Definitions.--Section 168(i) is amended by inserting at 
     the end the following new paragraph:
       ``(18) Qualified smart electric meters.--
       ``(A) In general.--The term `qualified smart electric 
     meter' means any smart electric meter which is placed in 
     service by a taxpayer who is a supplier of electric energy or 
     a provider of electric energy services.
       ``(B) Smart electric meter.--For purposes of subparagraph 
     (A), the term `smart electric meter' means any time-based 
     meter and related communication equipment which is capable of 
     being used by the taxpayer as part of a system that--
       ``(i) measures and records electricity usage data on a 
     time-differentiated basis in at least 24 separate time 
     segments per day,
       ``(ii) provides for the exchange of information between 
     supplier or provider and the customer's electric meter in 
     support of time-based rates or other forms of demand 
     response,
       ``(iii) provides data to such supplier or provider so that 
     the supplier or provider can provide energy usage information 
     to customers electronically, and
       ``(iv) provides net metering.
       ``(19) Qualified smart electric grid systems.--
       ``(A) In general.--The term `qualified smart electric grid 
     system' means any smart grid property used as part of a 
     system for electric distribution grid communications, 
     monitoring, and management placed in service by a taxpayer 
     who is a supplier of electric energy or a provider of 
     electric energy services.
       ``(B) Smart grid property.--For the purposes of 
     subparagraph (A), the term `smart grid property' means 
     electronics and related equipment that is capable of--
       ``(i) sensing, collecting, and monitoring data of or from 
     all portions of a utility's electric distribution grid,
       ``(ii) providing real-time, two-way communications to 
     monitor or manage such grid, and
       ``(iii) providing real time analysis of and event 
     prediction based upon collected data that can be used to 
     improve electric distribution system reliability, quality, 
     and performance.''.

[[Page S6043]]

       (c) Continued Application of 150 Percent Declining Balance 
     Method.--Paragraph (2) of section 168(b) is amended by 
     striking ``or'' at the end of subparagraph (B), by 
     redesignating subparagraph (C) as subparagraph (D), and by 
     inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) any property (other than property described in 
     paragraph (3)) which is a qualified smart electric meter or 
     qualified smart electric grid system, or''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after the date of 
     the enactment of this Act.

     SEC. 3146. QUALIFIED GREEN BUILDING AND SUSTAINABLE DESIGN 
                   PROJECTS.

       (a) In General.--Paragraph (8) of section 142(l) is amended 
     by striking ``September 30, 2009'' and inserting ``September 
     30, 2012''.
       (b) Treatment of Current Refunding Bonds.--Paragraph (9) of 
     section 142(l) is amended by striking ``October 1, 2009'' and 
     inserting ``October 1, 2012''.
       (c) Accountability.--The second sentence of section 701(d) 
     of the American Jobs Creation Act of 2004 is amended by 
     striking ``issuance,'' and inserting ``issuance of the last 
     issue with respect to such project,''.

                     Subtitle D--Revenue Provisions

     SEC. 3151. NONQUALIFIED DEFERRED COMPENSATION FROM CERTAIN 
                   TAX INDIFFERENT PARTIES.

       (a) In General.--Subpart B of part II of subchapter E of 
     chapter 1 is amended by inserting after section 457 the 
     following new section:

     ``SEC. 457A. NONQUALIFIED DEFERRED COMPENSATION FROM CERTAIN 
                   TAX INDIFFERENT PARTIES.

       ``(a) In General.--Any compensation which is deferred under 
     a nonqualified deferred compensation plan of a nonqualified 
     entity shall be includible in gross income when there is no 
     substantial risk of forfeiture of the rights to such 
     compensation.
       ``(b) Nonqualified Entity.--For purposes of this section, 
     the term `nonqualified entity' means--
       ``(1) any foreign corporation unless substantially all of 
     its income is--
       ``(A) effectively connected with the conduct of a trade or 
     business in the United States, or
       ``(B) subject to a comprehensive foreign income tax, and
       ``(2) any partnership unless substantially all of its 
     income is allocated to persons other than--
       ``(A) foreign persons with respect to whom such income is 
     not subject to a comprehensive foreign income tax, and
       ``(B) organizations which are exempt from tax under this 
     title.
       ``(c) Determinability of Amounts of Compensation.--
       ``(1) In general.--If the amount of any compensation is not 
     determinable at the time that such compensation is otherwise 
     includible in gross income under subsection (a)--
       ``(A) such amount shall be so includible in gross income 
     when determinable, and
       ``(B) the tax imposed under this chapter for the taxable 
     year in which such compensation is includible in gross income 
     shall be increased by the sum of--
       ``(i) the amount of interest determined under paragraph 
     (2), and
       ``(ii) an amount equal to 20 percent of the amount of such 
     compensation.
       ``(2) Interest.--For purposes of paragraph (1)(B)(i), the 
     interest determined under this paragraph for any taxable year 
     is the amount of interest at the underpayment rate under 
     section 6621 plus 1 percentage point on the underpayments 
     that would have occurred had the deferred compensation been 
     includible in gross income for the taxable year in which 
     first deferred or, if later, the first taxable year in which 
     such deferred compensation is not subject to a substantial 
     risk of forfeiture.
       ``(d) Other Definitions and Special Rules.--For purposes of 
     this section--
       ``(1) Substantial risk of forfeiture.--
       ``(A) In general.--The rights of a person to compensation 
     shall be treated as subject to a substantial risk of 
     forfeiture only if such person's rights to such compensation 
     are conditioned upon the future performance of substantial 
     services by any individual.
       ``(B) Exception for compensation based on gain recognized 
     on an investment asset.--
       ``(i) In general.--To the extent provided in regulations 
     prescribed by the Secretary, if compensation is determined 
     solely by reference to the amount of gain recognized on the 
     disposition of an investment asset, such compensation shall 
     be treated as subject to a substantial risk of forfeiture 
     until the date of such disposition.
       ``(ii) Investment asset.--For purposes of clause (i), the 
     term `investment asset' means any single asset (other than an 
     investment fund or similar entity)--

       ``(I) acquired directly by an investment fund or similar 
     entity,
       ``(II) with respect to which such entity does not (nor does 
     any person related to such entity) participate in the active 
     management of such asset (or if such asset is an interest in 
     an entity, in the active management of the activities of such 
     entity), and
       ``(III) substantially all of any gain on the disposition of 
     which (other than such deferred compensation) is allocated to 
     investors in such entity.

       ``(iii) Coordination with special rule.--Paragraph (3)(B) 
     shall not apply to any compensation to which clause (i) 
     applies.
       ``(2) Comprehensive foreign income tax.--The term 
     `comprehensive foreign income tax' means, with respect to any 
     foreign person, the income tax of a foreign country if--
       ``(A) such person is eligible for the benefits of a 
     comprehensive income tax treaty between such foreign country 
     and the United States, or
       ``(B) such person demonstrates to the satisfaction of the 
     Secretary that such foreign country has a comprehensive 
     income tax.
       ``(3) Nonqualified deferred compensation plan.--
       ``(A) In general.--The term `nonqualified deferred 
     compensation plan' has the meaning given such term under 
     section 409A(d), except that such term shall include any plan 
     that provides a right to compensation based on the 
     appreciation in value of a specified number of equity units 
     of the service recipient.
       ``(B) Exception.--Compensation shall not be treated as 
     deferred for purposes of this section if the service provider 
     receives payment of such compensation not later than 12 
     months after the end of the taxable year of the service 
     recipient during which the right to the payment of such 
     compensation is no longer subject to a substantial risk of 
     forfeiture.
       ``(4) Exception for certain compensation with respect to 
     effectively connected income.--In the case a foreign 
     corporation with income which is taxable under section 882, 
     this section shall not apply to compensation which, had such 
     compensation had been paid in cash on the date that such 
     compensation ceased to be subject to a substantial risk of 
     forfeiture, would have been deductible by such foreign 
     corporation against such income.
       ``(5) Application of rules.--Rules similar to the rules of 
     paragraphs (5) and (6) of section 409A(d) shall apply.
       ``(e) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary or appropriate to carry out 
     the purposes of this section, including regulations 
     disregarding a substantial risk of forfeiture in cases where 
     necessary to carry out the purposes of this section.''.
       (b) Conforming Amendment.--Section 26(b)(2), as amended by 
     section 3011, is amended by striking ``and'' at the end of 
     subparagraph (V), by striking the period at the end of 
     subparagraph (W) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(X) section 457A(c)(1)(B) (relating to determinability of 
     amounts of compensation).''.
       (c) Clerical Amendment.--The table of sections of subpart B 
     of part II of subchapter E of chapter 1 is amended by 
     inserting after the item relating to section 457 the 
     following new item:

``Sec. 457A. Nonqualified deferred compensation from certain tax 
              indifferent parties.''.
       (d) Effective Date.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the amendments made by this section shall apply 
     to amounts deferred which are attributable to services 
     performed after December 31, 2008.
       (2) Application to existing deferrals.--In the case of any 
     amount deferred to which the amendments made by this section 
     do not apply solely by reason of the fact that the amount is 
     attributable to services performed before January 1, 2009, to 
     the extent such amount is not includible in gross income in a 
     taxable year beginning before 2018, such amounts shall be 
     includible in gross income in the later of--
       (A) the last taxable year beginning before 2018, or
       (B) the taxable year in which there is no substantial risk 
     of forfeiture of the rights to such compensation (determined 
     in the same manner as determined for purposes of section 457A 
     of the Internal Revenue Code of 1986, as added by this 
     section).
       (3) Charitable contributions of existing deferrals 
     permitted.--
       (A) In general.--Subsection (b) of section 170 of the 
     Internal Revenue Code of 1986 shall not apply to (and 
     subsections (b) and (d) of such section shall be applied 
     without regard to) so much of the taxpayer's qualified 
     contributions made during the taxpayer's last taxable year 
     beginning before 2018 as does not exceed the taxpayer's 
     qualified inclusion amount. For purposes of subsection (b) of 
     section 170 of such Code, the taxpayer's contribution base 
     for such last taxable year shall be reduced by the amount of 
     the taxpayer's qualified contributions to which such 
     subsection does not apply by reason the preceding sentence.
       (B) Qualified contributions.--For purposes of this 
     paragraph, the term ``qualified contributions'' means the 
     aggregate charitable contributions (as defined in section 
     170(c) of such Code) paid in cash by the taxpayer to 
     organizations described in section 170(b)(1)(A) of such Code 
     (other than any organization described in section 509(a)(3) 
     of such Code or any fund or account described in section 
     4966(d)(2) of such Code).
       (C) Qualified inclusion amount.--For purposes of this 
     paragraph, the term ``qualified inclusion amount'' means the 
     amount includible in the taxpayer's gross income for the last 
     taxable year beginning before 2018 by reason of paragraph 
     (2).
       (4) Accelerated payments.--No later than 120 days after the 
     date of the enactment of

[[Page S6044]]

     this Act, the Secretary shall issue guidance providing a 
     limited period of time during which a nonqualified deferred 
     compensation arrangement attributable to services performed 
     on or before December 31, 2008, may, without violating the 
     requirements of section 409A(a) of the Internal Revenue Code 
     of 1986, be amended to conform the date of distribution to 
     the date the amounts are required to be included in income.
       (5) Certain back-to-back arrangements.--If the taxpayer is 
     also a service recipient and maintains one or more 
     nonqualified deferred compensation arrangements for its 
     service providers under which any amount is attributable to 
     services performed on or before December 31, 2008, the 
     guidance issued under paragraph (4) shall permit such 
     arrangements to be amended to conform the dates of 
     distribution under such arrangement to the date amounts are 
     required to be included in the income of such taxpayer under 
     this subsection.
       (6) Accelerated payment not treated as material 
     modification.--Any amendment to a nonqualified deferred 
     compensation arrangement made pursuant to paragraph (4) or 
     (5) shall not be treated as a material modification of the 
     arrangement for purposes of section 409A of the Internal 
     Revenue Code of 1986.
                                 ______
                                 
  SA 5046. Mr. CORNYN (for himself, Mrs. Boxer, Mr. Roberts, Mr. Pryor, 
Mr. Isakson, and Mr. Salazar) submitted an amendment intended to be 
proposed by him to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       At the appropriate place, insert the following:

     SEC. __. REQUIRING MORTGAGE DISCLOSURE.

       (a) In General.--Section 102(a)(4)(A) of the Ethics in 
     Government Act of 1978 (5 U.S.C. App) is amended by inserting 
     after ``spouse'' the following: ``, except that this 
     exception shall not apply to a reporting individual described 
     in section 101(f)(9)''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall take effect 1 month after the date of enactment of this 
     Act.
                                 ______
                                 
  SA 5047. Mr. ENSIGN submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 82, strike line 4 and all that follows through page 
     401, line 4, and insert the following:
       ``(iii) each enterprise received credit towards achieving 
     each of its goals resulting from a transaction or activity 
     pursuant to section 1331(b)(2); and
       ``(iv) each enterprise is achieving the purposes of the 
     enterprise established by law; and
       ``(B) the actions that each enterprise could undertake to 
     promote and expand the purposes of the enterprise;
       ``(2) aggregate and analyze relevant data on income to 
     assess the compliance of each enterprise with the housing 
     goals established under subpart B;
       ``(3) aggregate and analyze data on income, race, and 
     gender by census tract and other relevant classifications, 
     and compare such data with larger demographic, housing, and 
     economic trends;
       ``(4) identify the extent to which each enterprise is 
     involved in mortgage purchases and secondary market 
     activities involving subprime and nontraditional loans;
       ``(5) compare the characteristics of subprime and 
     nontraditional loans both purchased and securitized by each 
     enterprise to other loans purchased and securitized by each 
     enterprise; and
       ``(6) compare the characteristics of high-cost loans 
     purchased and securitized, where such securities are not held 
     on portfolio to loans purchased and securitized, where such 
     securities are either retained on portfolio or repurchased by 
     the enterprise, including such characteristics as--
       ``(A) the purchase price of the property that secures the 
     mortgage;
       ``(B) the loan-to-value ratio of the mortgage, which shall 
     reflect any secondary liens on the relevant property;
       ``(C) the terms of the mortgage;
       ``(D) the creditworthiness of the borrower; and
       ``(E) any other relevant data, as determined by the 
     Director.
       ``(c) Data Collection and Reporting.--
       ``(1) In general.--To assist the Director in analyzing the 
     matters described in subsection (b), the Director shall 
     conduct, on a monthly basis, a survey of mortgage markets in 
     accordance with this subsection.
       ``(2) Data points.--Each monthly survey conducted by the 
     Director under paragraph (1) shall collect data on--
       ``(A) the characteristics of individual mortgages that are 
     eligible for purchase by the enterprises and the 
     characteristics of individual mortgages that are not eligible 
     for purchase by the enterprises including, in both cases, 
     information concerning--
       ``(i) the price of the house that secures the mortgage;
       ``(ii) the loan-to-value ratio of the mortgage, which shall 
     reflect any secondary liens on the relevant property;
       ``(iii) the terms of the mortgage;
       ``(iv) the creditworthiness of the borrower or borrowers; 
     and
       ``(v) whether the mortgage, in the case of a conforming 
     mortgage, was purchased by an enterprise;
       ``(B) the characteristics of individual subprime and 
     nontraditional mortgages that are eligible for purchase by 
     the enterprises and the characteristics of borrowers under 
     such mortgages, including the creditworthiness of such 
     borrowers and determination whether such borrowers would 
     qualify for prime lending; and
       ``(C) such other matters as the Director determines to be 
     appropriate.
       ``(3) Public availability.--The Director shall make any 
     data collected by the Director in connection with the conduct 
     of a monthly survey available to the public in a timely 
     manner, provided that the Director may modify the data 
     released to the public to ensure that the data--
       ``(A) is not released in an identifiable form; and
       ``(B) is not otherwise obtainable from other publicly 
     available data sets.
       ``(4) Definition.--For purposes of this subsection, the 
     term `identifiable form' means any representation of 
     information that permits the identity of a borrower to which 
     the information relates to be reasonably inferred by either 
     direct or indirect means.''.

     SEC. 1126. PUBLIC USE DATABASE.

       Section 1323 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (42 U.S.C. 4543) is 
     amended--
       (1) in subsection (a)--
       (A) by striking ``(a) In General.--The Secretary'' and 
     inserting the following:
       ``(a) Availability.--
       ``(1) In general.--The Director''; and
       (B) by adding at the end the following new paragraph:
       ``(2) Census tract level reporting.--Such data shall 
     include the data elements required to be reported under the 
     Home Mortgage Disclosure Act of 1975, at the census tract 
     level.'';
       (2) in subsection (b)(2), by inserting before the period at 
     the end the following: ``or with subsection (a)(2)''; and
       (3) by adding at the end the following new subsection:
       ``(d) Timing.--Data submitted under this section by an 
     enterprise in connection with a provision referred to in 
     subsection (a) shall be made publicly available in accordance 
     with this section not later than September 30 of the year 
     following the year to which the data relates.''.

     SEC. 1127. REPORTING OF MORTGAGE DATA.

       Section 1326 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4546) is 
     amended--
       (1) in subsection (a), by striking ``The Director'' and 
     inserting ``Subject to subsection (d), the Director''; and
       (2) by adding at the end the following:
       ``(d) Mortgage Information.--Subject to privacy 
     considerations, as described in section 304(j) of the Home 
     Mortgage Disclosure Act of 1975 (12 U.S.C. 2803(j)), the 
     Director shall, by regulation or order, provide that certain 
     information relating to single family mortgage data of the 
     enterprises shall be disclosed to the public, in order to 
     make available to the public--
       ``(1) the same data from the enterprises that is required 
     of insured depository institutions under the Home Mortgage 
     Disclosure Act of 1975; and
       ``(2) information collected by the Director under section 
     1324(b)(6).''.

     SEC. 1128. REVISION OF HOUSING GOALS.

       (a) Repeal.--Sections 1331 through 1334 of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4561 through 4564) are hereby repealed.
       (b) Housing Goal.--The Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 is amended by 
     inserting before section 1335 the following:

     ``SEC. 1331. ESTABLISHMENT OF HOUSING GOALS.

       ``(a) In General.--The Director shall, by regulation, 
     establish effective for the first calendar year that begins 
     after the date of enactment of the Federal Housing Finance 
     Regulatory Reform Act of 2008, and each year thereafter, 
     annual housing goals, as described under this subpart, with 
     respect to the mortgage purchases by the enterprises.
       ``(b) Special Counting Requirements.--
       ``(1) In general.--The Director shall determine whether an 
     enterprise shall receive full, partial, or no credit for a 
     transaction toward achievement of any of the housing

[[Page S6045]]

     goals established pursuant to this section or sections 1332 
     through 1334.
       ``(2) Considerations.--In making any determination under 
     paragraph (1), the Director shall consider whether a 
     transaction or activity of an enterprise is substantially 
     equivalent to a mortgage purchase and either (A) creates a 
     new market, or (B) adds liquidity to an existing market, 
     provided however that the terms and conditions of such 
     mortgage purchase is neither determined to be unacceptable, 
     nor contrary to good lending practices, and otherwise 
     promotes sustainable homeownership and further, that such 
     mortgage purchase actually fulfills the purposes of the 
     enterprise and is in accordance with the chartering Act of 
     such enterprise.
       ``(c) Eliminating Interest Rate Disparities.--
       ``(1) In general.--In establishing and implementing the 
     housing goals under this subpart, the Director shall require 
     the enterprises to disclose appropriate information to allow 
     the Director to assess if there are any disparities in 
     interest rates charged on mortgages to borrowers who are 
     minorities, as compared with borrowers of similar 
     creditworthiness who are not minorities, as evidenced in 
     reports pursuant to the Home Mortgage Disclosure Act of 1975.
       ``(2) Report to congress on disparities.--Upon a finding by 
     the Director that a pattern of disparities in interest rates 
     exists pursuant to the information provided by an enterprise 
     under paragraph (1), the Director shall--
       ``(A) forward to the Committee on Banking, Housing, and 
     Urban Affairs of the Senate and the Committee on Financial 
     Services of the House of Representatives a report detailing 
     the disparities; and
       ``(B) forward the report prepared under subparagraph (A) to 
     any other appropriate regulatory or enforcement agency.
       ``(3) Identity of individuals not disclosed.--In carrying 
     out this subsection, the Director shall ensure that no 
     personally identifiable financial information that would 
     enable an individual borrower to be reasonably identified 
     shall be made public.
       ``(d) Timing.--The Director shall establish an annual 
     deadline for the establishment of housing goals described in 
     subsection (a), taking into consideration the need for the 
     enterprises to reasonably and sufficiently plan their 
     operations and activities in advance, including operations 
     and activities necessary to meet such goals.

     ``SEC. 1331A. DISCRETIONARY ADJUSTMENT OF HOUSING GOALS.

       ``(a) Authority.--
       ``(1) Review.--The Director shall review the 
     appropriateness of each goal established pursuant to this 
     subpart at least once during each year to assure that given 
     current market conditions that each such goal is feasible.
       ``(2) Petition to reduce.--An enterprise may petition the 
     Director in writing at any time during a year to reduce the 
     level of any goal for such year established pursuant to this 
     subpart.
       ``(b) Standard for Reduction.--The Director may reduce the 
     level for a goal pursuant to such a petition only if--
       ``(1) market and economic conditions or the financial 
     condition of the enterprise require such action; or
       ``(2) efforts to meet the goal would result in the 
     constraint of liquidity, over-investment in certain market 
     segments, or other consequences contrary to the intent of 
     this subpart, section 301(3) of the Federal National Mortgage 
     Association Charter Act (12 U.S.C. 1716(3)), or section 
     301(b)(3) of the Federal Home Loan Mortgage Corporation Act 
     (12 U.S.C. 1451 note), as applicable.
       ``(c) Determination.--
       ``(1) 30-day period.--If an enterprise submits a petition 
     for reduction to the Director under subsection (a)(2), the 
     Director shall make a determination regarding any proposed 
     reduction within 30 days of receipt of the petition.
       ``(2) Extension.--The Director may extend the period 
     described in paragraph (1) for a single additional 15-day 
     period, but only if the Director requests additional 
     information from the enterprise.

     ``SEC. 1332. SINGLE-FAMILY HOUSING GOALS.

       ``(a) Establishment of Goals.--
       ``(1) In general.--The Director shall establish annual 
     goals for the purchase by each enterprise of conventional, 
     conforming, single-family, owner-occupied, purchase money 
     mortgages financing housing for each of the following:
       ``(A) Low-income families.
       ``(B) Families that reside in low-income areas.
       ``(C) Very low-income families.
       ``(2) Goals as percentage of total purchase money mortgage 
     purchases.--The goals established under paragraph (1) shall 
     be established as a percentage of the total number of single-
     family dwelling units financed by single-family purchase 
     money mortgage purchases of the enterprise.
       ``(b) Determination of Compliance.--
       ``(1) In general.--The Director shall determine, for each 
     year that the housing goals under this section are in effect 
     pursuant to section 1331(a), whether each enterprise has 
     complied with the single-family housing goals established 
     under this section for such year.
       ``(2) Compliance requirements.--An enterprise shall be 
     considered to be in compliance with a goal described under 
     subsection (a) for a year, only if, for each of the types of 
     families described in subsection (a), the percentage of the 
     number of conventional, conforming, single-family, owner-
     occupied, purchase money mortgages purchased by the 
     enterprise in such year that serve such families, meets or 
     exceeds the target established under subsection (c) for the 
     year for such type of family.
       ``(c) Annual Targets.--
       ``(1) In general.--The Director shall establish annual 
     targets for each goal described in subsection (a).
       ``(2) Considerations.--In establishing annual targets under 
     paragraph (1), the Director shall consider--
       ``(A) national housing needs;
       ``(B) economic, housing, and demographic conditions;
       ``(C) the performance and effort of the enterprises toward 
     achieving the housing goals under this section in previous 
     years;
       ``(D) the ability of the enterprise to lead the industry in 
     making mortgage credit available;
       ``(E) recent information submitted in compliance with the 
     Home Mortgage Disclosure Act of 1975 and such other reliable 
     mortgage data as may be available;
       ``(F) the size of the purchase money conventional mortgage 
     market serving each of the types of families described in 
     subsection (a), relative to the size of the overall purchase 
     money mortgage market; and
       ``(G) the need to maintain the sound financial condition of 
     the enterprises.
       ``(3) High-cost loans and inappropriate lending 
     practices.--In establishing annual targets under paragraph 
     (1), the Director shall not consider segments of the market 
     determined to be unacceptable or contrary to good lending 
     practices pursuant to section 1331(b)(2).
       ``(d) Notice of Determination and Enterprise Comment.--
       ``(1) Notice.--Within 30 days of making a determination 
     under subsection (b) regarding compliance of an enterprise 
     for a year with the housing goals established under this 
     section and before any public disclosure thereof, the 
     Director shall provide notice of the determination to the 
     enterprise, which shall include an analysis and comparison, 
     by the Director, of the performance of the enterprise for the 
     year and the targets for the year under subsection (c).
       ``(2) Comment period.--The Director shall provide each 
     enterprise and the public an opportunity to comment on the 
     determination during the 30-day period beginning upon receipt 
     by the enterprise of the notice.
       ``(e) Use of Borrower Income.--In monitoring the 
     performance of each enterprise pursuant to the housing goals 
     under this section and evaluating such performance (for 
     purposes of section 1336), the Director shall consider a 
     mortgagor's income to be the income of the mortgagor at the 
     time of origination of the mortgage.
       ``(f) Consideration of Properties With Rental Units.--
     Mortgages financing 1-to-4 unit owner-occupied properties 
     shall count toward the achievement of the single-family 
     housing goal under this section, if such properties otherwise 
     meet the requirements under this section notwithstanding the 
     use of 1 or more units for rental purposes.

     ``SEC. 1333. SINGLE-FAMILY HOUSING REFINANCE GOALS.

       ``(a) Prepayment of Existing Loans.--
       ``(1) In general.--The Director shall establish annual 
     goals for the purchase by each enterprise of mortgages on 
     conventional, conforming, single-family, owner-occupied 
     housing given to pay off or prepay an existing loan served by 
     the same property for each of the following:
       ``(A) Low-income families.
       ``(B) Families that reside in low-income areas.
       ``(C) Very low-income families.
       ``(2) Goals as percentage of total refinancing mortgage 
     purchases.--The goals described under paragraph (1) shall be 
     established as a percentage of the total number of single-
     family dwelling units refinanced by mortgage purchases of 
     each enterprise.
       ``(b) Determination of Compliance.--
       ``(1) In general.--The Director shall determine, for each 
     year that the housing goals under this section are in effect 
     pursuant to section 1331(a), whether each enterprise has 
     complied with the single-family housing refinance goals 
     established under this section for such year.
       ``(2) Compliance.--An enterprise shall be considered to be 
     in compliance with the goals of this section for a year, only 
     if, for each of the types of families described in subsection 
     (a), the percentage of the number of conventional, 
     conforming, single-family, owner-occupied refinancing 
     mortgages purchased by each enterprise in such year that 
     serve such families, meets or exceeds the target for the year 
     for such type of family that is established under subsection 
     (c).
       ``(c) Annual Targets.--
       ``(1) In general.--The Director shall establish annual 
     targets for each goal described in subsection (a).
       ``(2) Considerations.--In establishing annual targets under 
     paragraph (1), the Director shall consider--
       ``(A) national housing needs;
       ``(B) economic, housing, and demographic conditions;
       ``(C) the performance and effort of the enterprises toward 
     achieving the housing goals under this section in previous 
     years;
       ``(D) the ability of the enterprise to lead the industry in 
     making mortgage credit available;

[[Page S6046]]

       ``(E) recent information submitted in compliance with the 
     Home Mortgage Disclosure Act of 1975 and such other reliable 
     mortgage data as may be available;
       ``(F) the size of the purchase money conventional mortgage 
     market serving each of the types of families described in 
     subsection (a), relative to the size of the overall purchase 
     money mortgage market; and
       ``(G) the need to maintain the sound financial condition of 
     the enterprises.
       ``(d) Notice of Determination and Enterprise Comment.--
       ``(1) Notice.--Within 30 days of making a determination 
     under subsection (b) regarding compliance of an enterprise 
     for a year with the housing goals established under this 
     section and before any public disclosure thereof, the 
     Director shall provide notice of the determination to the 
     enterprise, which shall include an analysis and comparison, 
     by the Director, of the performance of the enterprise for the 
     year and the targets for the year under subsection (c).
       ``(2) Comment period.--The Director shall provide each 
     enterprise and the public an opportunity to comment on the 
     determination during the 30-day period beginning upon receipt 
     by the enterprise of the notice.
       ``(e) Use of Borrower Income.--In monitoring the 
     performance of each enterprise pursuant to the housing goals 
     under this section and evaluating such performance (for 
     purposes of section 1336), the Director shall consider a 
     mortgagor's income to be the income of the mortgagor at the 
     time of origination of the mortgage.

     ``SEC. 1334. MULTIFAMILY SPECIAL AFFORDABLE HOUSING GOAL.

       ``(a) Establishment.--
       ``(1) In general.--The Director shall establish, by 
     regulation, by unit, dollar volume, or percentage of 
     multifamily activity, as determined by the Director, an 
     annual goal for the purchase by each enterprise of--
       ``(A) mortgages that finance dwelling units affordable to 
     very low-income families; and
       ``(B) mortgages that finance dwelling units assisted by the 
     low-income housing tax credit under section 42 of the 
     Internal Revenue Code of 1986.
       ``(2) Additional requirements for smaller projects.--The 
     Director shall establish, within the housing goal established 
     under this section, additional requirements for the purchase 
     by each enterprise of mortgages described in paragraph (1) 
     for multifamily housing projects of a smaller or limited 
     size, which may be based on the number of dwelling units in 
     the project or the amount of the mortgage, or both, and shall 
     include multifamily housing projects of 5 to 50 units (as 
     adjusted by the Director), or with mortgages of up to 
     $5,000,000 (as adjusted by the Director).
       ``(3) Factors.--The Director shall establish the goal and 
     additional requirements under this section taking into 
     consideration--
       ``(A) national multifamily mortgage credit needs;
       ``(B) the performance and effort of the enterprise in 
     making mortgage credit available for multifamily housing in 
     previous years;
       ``(C) the size of the multifamily mortgage market, 
     including the size of the small multifamily mortgage market;
       ``(D) the most recent information available for the 
     Residential Survey published by the Census Bureau, and such 
     other reliable data as may be available regarding multifamily 
     mortgages;
       ``(E) the ability of the enterprise to lead the industry in 
     expanding mortgage credit availability at favorable terms, 
     especially for underserved markets, such as for--
       ``(i) small multifamily projects;
       ``(ii) multifamily properties in need of preservation and 
     rehabilitation; and
       ``(iii) multifamily properties located in rural areas; and
       ``(F) the need to maintain the sound financial condition of 
     the enterprise.
       ``(b) Units Financed by Housing Finance Agency Bonds.--The 
     Director may give credit toward the achievement of the 
     multifamily special affordable housing goal under this 
     section (for purposes of section 1336) to dwelling units in 
     multifamily housing projects that otherwise qualify under 
     such goal and that are financed by tax-exempt or taxable 
     bonds issued by a State or local housing finance agency, but 
     only if such bonds--
       ``(1) are secured by a guarantee of the enterprise; or
       ``(2) are not investment grade and are purchased by the 
     enterprise.
       ``(c) Use of Tenant Rent Level.--
       ``(1) In general.--The Director shall monitor the 
     performance of each enterprise in meeting the goal 
     established under this section and shall evaluate such 
     performance (for purposes of section 1336) based on whether 
     the rent levels are affordable to low-income and very low-
     income families.
       ``(2) Rent level.--A rent level shall be considered to be 
     affordable for purposes of this subsection for an income 
     category referred to in this subsection if it does not exceed 
     30 percent of the maximum income level of such income 
     category, with appropriate adjustments for unit size as 
     measured by the number of bedrooms.
       ``(d) Determination of Compliance.--
       ``(1) In general.--The Director shall, for each year that 
     the housing goal under this section is in effect pursuant to 
     section 1331(a), determine whether each enterprise has 
     complied with such goal and the additional requirements under 
     subsection (a)(2).
       ``(2) Compliance.--An enterprise shall be considered to be 
     in compliance with the goal described under subsection (a) 
     for a year only if the multifamily mortgage purchases of the 
     enterprise meet or exceed the goal for the year established 
     under subsection (a).
       ``(e) Consideration of Units in Single-Family Rental 
     Housing.--In establishing the goal under this section, the 
     Director may take into consideration the number of housing 
     units financed by any mortgage purchased by an enterprise on 
     single-family rental housing that is not owner-occupied.
       ``(f) Removing Credit.--The Director shall subtract from 
     the units or mortgages counted toward the goal established 
     under this section in a current year any units or mortgages 
     credited toward such goal in a prior year if an enterprise 
     requires a lender to repurchase, or reimburse for losses, or 
     indemnify the enterprise against potential losses on such 
     units or mortgages.
       ``(g) Notice of Determination and Enterprise Comment.--
       ``(1) Notice.--Within 30 days of making a determination 
     under subsection (d) regarding compliance of an enterprise 
     for a year with the housing goal established under this 
     section and before any public disclosure thereof, the 
     Director shall provide notice of the determination to the 
     enterprise, which shall include an analysis and comparison, 
     by the Director, of the performance of the enterprise for the 
     year and the goal for the year under subsection (a).
       ``(2) Comment period.--The Director shall provide each 
     enterprise and the public an opportunity to comment on the 
     determination during the 30-day period beginning upon receipt 
     by the enterprise of the notice.''.
       (c) Conforming Amendments.--The Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 is amended--
       (1) in section 1335(a) (12 U.S.C. 4565(a)), in the matter 
     preceding paragraph (1), by striking ``low- and moderate-
     income housing goal'' and all that follows through ``section 
     1334'' and inserting ``housing goals established under this 
     subpart''; and
       (2) in section 1336(a)(1) (12 U.S.C. 4566(a)(1)), by 
     striking ``sections 1332, 1333, and 1334,'' and inserting 
     ``this subpart''.
       (d) Definitions.--Section 1303 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4502) is amended--
       (1) by striking paragraph (24), as so designated by section 
     1002 of this Act, and inserting the following:
       ``(24) Very low-income.--
       ``(A) In general.--The term `very low-income' means--
       ``(i) in the case of owner-occupied units, families having 
     incomes not greater than 50 percent of the area median 
     income; and
       ``(ii) in the case of rental units, families having incomes 
     not greater than 50 percent of the area median income, with 
     adjustments for smaller and larger families, as determined by 
     the Director.
       ``(B) Rule of construction.--For purposes of section 1338 
     and 1339, the term `very low-income' means--
       ``(i) in the case of owner-occupied units, income in excess 
     of 30 percent but not greater than 50 percent of the area 
     median income; and
       ``(ii) in the case of rental units, income in excess of 30 
     percent but not greater than 50 percent of the area median 
     income, with adjustments for smaller and larger families, as 
     determined by the Director.''; and
       (2) by adding at the end the following:
       ``(26) Conforming mortgage.--The term `conforming mortgage' 
     means, with respect to an enterprise, a conventional mortgage 
     having an original principal obligation that does not exceed 
     the applicable dollar limitation, in effect at the time of 
     such origination, under--
       ``(A) section 302(b)(2) of the Federal National Mortgage 
     Association Charter Act; or
       ``(B) section 305(a)(2) of the Federal Home Loan Mortgage 
     Corporation Act.
       ``(27) Extremely low-income.--The term `extremely low-
     income' means--
       ``(A) in the case of owner-occupied units, income not in 
     excess of 30 percent of the area median income; and
       ``(B) in the case of rental units, income not in excess of 
     30 percent of the area median income, with adjustments for 
     smaller and larger families, as determined by the Director.
       ``(28) Low-income area.--The term `low-income area' means a 
     census tract or block numbering area in which the median 
     income does not exceed 80 percent of the median income for 
     the area in which such census tract or block numbering area 
     is located, and, for the purposes of section 1332(a)(2), 
     shall include families having incomes not greater than 100 
     percent of the area median income who reside in minority 
     census tracts.
       ``(29) Minority census tract.--The term `minority census 
     tract' means a census tract that has a minority population of 
     at least 30 percent and a median family income of less than 
     100 percent of the area family median income.
       ``(30) Shortage of standard rental units both affordable 
     and available to extremely low-income renter households.--
       ``(A) In general.--The term `shortage of standard rental 
     units both affordable and available to extremely low-income 
     renter households' means the gap between--
       ``(i) the number of units with complete plumbing and 
     kitchen facilities with a rent that is 30 percent or less of 
     30 percent of the adjusted area median income as determined 
     by the Director that are occupied by extremely low-income 
     renter households or are vacant for rent; and

[[Page S6047]]

       ``(ii) the number of extremely low-income renter 
     households.
       ``(B) Rule of construction.--If the number of units 
     described in subparagraph (A)(i) exceeds the number of 
     extremely low-income households as described in subparagraph 
     (A)(ii), there is no shortage.
       ``(31) Shortage of standard rental units both affordable 
     and available to very low-income renter households.--
       ``(A) In general.--The term `shortage of standard rental 
     units both affordable and available to very low-income renter 
     households' means the gap between--
       ``(i) the number of units with complete plumbing and 
     kitchen facilities with a rent that is 30 percent or less of 
     50 percent of the adjusted area median income as determined 
     by the Director that are occupied by either extremely low- or 
     very low-income renter households or are vacant for rent; and
       ``(ii) the number of extremely low- and very low-income 
     renter households.
       ``(B) Rule of construction.--If the number of units 
     described in subparagraph (A)(i) exceeds the number of 
     extremely low- and very low-income households as described in 
     subparagraph (A)(ii), there is no shortage.''.

     SEC. 1129. DUTY TO SERVE UNDERSERVED MARKETS.

       (a) Establishment and Evaluation of Performance.--Section 
     1335 of the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992 (12 U.S.C. 4565) is amended--
       (1) in the section heading, by inserting ``duty to serve 
     underserved markets and'' before ``other'';
       (2) by striking subsection (b);
       (3) in subsection (a)--
       (A) in the matter preceding paragraph (1), by inserting 
     ``and to carry out the duty under subsection (a) of this 
     section'' before ``, each enterprise shall'';
       (B) in paragraph (3), by inserting ``and'' after the 
     semicolon at the end;
       (C) in paragraph (4), by striking ``; and'' and inserting a 
     period;
       (D) by striking paragraph (5); and
       (E) by redesignating such subsection as subsection (b);
       (4) by inserting before subsection (b) (as so redesignated 
     by paragraph (3)(E) of this subsection) the following new 
     subsection:
       ``(a) Duty to Serve Underserved Markets.--
       ``(1) Duty.--In accordance with the purpose of the 
     enterprises under section 301(3) of the Federal National 
     Mortgage Association Charter Act (12 U.S.C. 1716) and section 
     301(b)(3) of the Federal Home Loan Mortgage Corporation Act 
     (12 U.S.C. 1451 note) to undertake activities relating to 
     mortgages on housing for very low-, low-, and moderate-income 
     families involving a reasonable economic return that may be 
     less than the return earned on other activities, each 
     enterprise shall have the duty to increase the liquidity of 
     mortgage investments and improve the distribution of 
     investment capital available for mortgage financing for 
     underserved markets by purchasing or securitizing mortgage 
     investments.
       ``(2) Underserved markets.--To meet its duty under 
     paragraph (1), each enterprise shall comply with the 
     following requirements with respect to the following 
     underserved markets:
       ``(A) Manufactured housing.--The enterprise shall lead the 
     industry in developing loan products and flexible 
     underwriting guidelines to facilitate a secondary market for 
     mortgages on manufactured homes for very low-, low-, and 
     moderate-income families.
       ``(B) Affordable housing preservation.--The enterprise 
     shall lead the industry in developing loan products and 
     flexible underwriting guidelines to facilitate a secondary 
     market to preserve housing affordable to very low-, low-, and 
     moderate-income families, including housing projects 
     subsidized under--
       ``(i) the project-based and tenant-based rental assistance 
     programs under section 8 of the United States Housing Act of 
     1937;
       ``(ii) the program under section 236 of the National 
     Housing Act;
       ``(iii) the below-market interest rate mortgage program 
     under section 221(d)(4) of the National Housing Act;
       ``(iv) the supportive housing for the elderly program under 
     section 202 of the Housing Act of 1959;
       ``(v) the supportive housing program for persons with 
     disabilities under section 811 of the Cranston-Gonzalez 
     National Affordable Housing Act;
       ``(vi) the programs under title IV of the McKinney-Vento 
     Homeless Assistance Act (42 U.S.C. 11361 et seq.), but only 
     permanent supportive housing projects subsidized under such 
     programs; and
       ``(vii) the rural rental housing program under section 515 
     of the Housing Act of 1949.
       ``(C) Rural and other underserved markets.--The enterprise 
     shall lead the industry in developing loan products and 
     flexible underwriting guidelines to facilitate a secondary 
     market for mortgages on housing for very low-, low-, and 
     moderate-income families in rural areas, and for mortgages 
     for housing for any other underserved market for very low-, 
     low-, and moderate-income families that the Director 
     identifies as lacking adequate credit through conventional 
     lending sources. Such underserved markets may be identified 
     by borrower type, market segment, or geographic area.''; and
       (5) by adding at the end the following new subsection:
       ``(c) Evaluation and Reporting of Compliance.--
       ``(1) In general.--Not later than 6 months after the 
     effective date of the Federal Housing Finance Regulatory 
     Reform Act of 2008, the Director shall establish a manner for 
     evaluating whether, and the extent to which, the enterprises 
     have complied with the duty under subsection (a) to serve 
     underserved markets and for rating the extent of such 
     compliance. Using such method, the Director shall, for each 
     year, evaluate such compliance and rate the performance of 
     each enterprise as to extent of compliance. The Director 
     shall include such evaluation and rating for each enterprise 
     for a year in the report for that year submitted pursuant to 
     section 1319B(a).
       ``(2) Separate evaluations.--In determining whether an 
     enterprise has complied with the duty referred to in 
     paragraph (1), the Director shall separately evaluate whether 
     the enterprise has complied with such duty with respect to 
     each of the underserved markets identified in subsection (a), 
     taking into consideration--
       ``(A) the development of loan products and more flexible 
     underwriting guidelines;
       ``(B) the extent of outreach to qualified loan sellers in 
     each of such underserved markets; and
       ``(C) the volume of loans purchased in each of such 
     underserved markets.
       ``(3) Manufactured housing market.--In determining whether 
     an enterprise has complied with the duty under subparagraph 
     (A) of subsection (a)(2), the Director may consider loans 
     secured by both real and personal property.''.
       (b) Enforcement.--Subsection (a) of section 1336 of the 
     Housing and Community Development Act of 1992 (12 U.S.C. 
     4566(a)) is amended--
       (1) in paragraph (1), by inserting ``and with the duty 
     under section 1335(a) of each enterprise with respect to 
     underserved markets,'' before ``as provided in this 
     section''; and
       (2) by adding at the end of such subsection, as amended by 
     the preceding provisions of this subtitle, the following new 
     paragraph:
       ``(4) Enforcement of duty to provide mortgage credit to 
     underserved markets.--The duty under section 1335(a) of each 
     enterprise to serve underserved markets (as determined in 
     accordance with section 1335(c)) shall be enforceable under 
     this section to the same extent and under the same provisions 
     that the housing goals established under this subpart are 
     enforceable. Such duty shall not be enforceable under any 
     other provision of this title (including subpart C of this 
     part) other than this section or under any provision of the 
     Federal National Mortgage Association Charter Act or the 
     Federal Home Loan Mortgage Corporation Act.''.

     SEC. 1130. MONITORING AND ENFORCING COMPLIANCE WITH HOUSING 
                   GOALS.

       (a) In General.--Section 1336 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4566) is amended by striking subsections (b) and (c) 
     and inserting the following:
       ``(b) Notice and Preliminary Determination of Failure To 
     Meet Goals.--
       ``(1) Notice.--If the Director preliminarily determines 
     that an enterprise has failed, or that there is a substantial 
     probability that an enterprise will fail, to meet any housing 
     goal under this subpart, the Director shall provide written 
     notice to the enterprise of such a preliminary determination, 
     the reasons for such determination, and the information on 
     which the Director based the determination.
       ``(2) Response period.--
       ``(A) In general.--During the 30-day period beginning on 
     the date on which an enterprise is provided notice under 
     paragraph (1), the enterprise may submit to the Director any 
     written information that the enterprise considers appropriate 
     for consideration by the Director in finally determining 
     whether such failure has occurred or whether the achievement 
     of such goal was or is feasible.
       ``(B) Extended period.--The Director may extend the period 
     under subparagraph (A) for good cause for not more than 30 
     additional days.
       ``(C) Shortened period.--The Director may shorten the 
     period under subparagraph (A) for good cause.
       ``(D) Failure to respond.--The failure of an enterprise to 
     provide information during the 30-day period under this 
     paragraph (as extended or shortened) shall waive any right of 
     the enterprise to comment on the proposed determination or 
     action of the Director.
       ``(3) Consideration of information and final 
     determination.--
       ``(A) In general.--After the expiration of the response 
     period under paragraph (2), or upon receipt of information 
     provided during such period by the enterprise, whichever 
     occurs earlier, the Director shall issue a final 
     determination on--
       ``(i) whether the enterprise has failed, or there is a 
     substantial probability that the enterprise will fail, to 
     meet the housing goal; and
       ``(ii) whether (taking into consideration market and 
     economic conditions and the financial condition of the 
     enterprise) the achievement of the housing goal was or is 
     feasible.
       ``(B) Considerations.--In making a final determination 
     under subparagraph (A), the Director shall take into 
     consideration any relevant information submitted by the 
     enterprise during the response period.
       ``(C) Notice.--The Director shall provide written notice, 
     including a response to any

[[Page S6048]]

     information submitted during the response period, to the 
     enterprise, the Committee on Banking, Housing, and Urban 
     Affairs of the Senate, and the Committee on Financial 
     Services of the House of Representatives, of--
       ``(i) each final determination under this paragraph that an 
     enterprise has failed, or that there is a substantial 
     probability that the enterprise will fail, to meet a housing 
     goal;
       ``(ii) each final determination that the achievement of a 
     housing goal was or is feasible; and
       ``(iii) the reasons for each such final determination.
       ``(c) Cease and Desist, Civil Money Penalties, and Remedies 
     Including Housing Plans.--
       ``(1) Requirement.--If the Director finds, pursuant to 
     subsection (b), that there is a substantial probability that 
     an enterprise will fail, or has actually failed, to meet any 
     housing goal under this subpart, and that the achievement of 
     the housing goal was or is feasible, the Director may require 
     that the enterprise submit a housing plan under this 
     subsection. If the Director makes such a finding and the 
     enterprise refuses to submit such a plan, submits an 
     unacceptable plan, fails to comply with the plan, or the 
     Director finds that the enterprise has failed to meet any 
     housing goal under this subpart, in addition to requiring an 
     enterprise to submit a housing plan, the Director may issue a 
     cease and desist order in accordance with section 1341, 
     impose civil money penalties in accordance with section 1345, 
     or order other remedies as set forth in paragraph (7).
       ``(2) Housing plan.--If the Director requires a housing 
     plan under this subsection, such a plan shall be--
       ``(A) a feasible plan describing the specific actions the 
     enterprise will take--
       ``(i) to achieve the goal for the next calendar year; and
       ``(ii) if the Director determines that there is a 
     substantial probability that the enterprise will fail to meet 
     a goal in the current year, to make such improvements and 
     changes in its operations as are reasonable in the remainder 
     of such year; and
       ``(B) sufficiently specific to enable the Director to 
     monitor compliance periodically.
       ``(3) Deadline for submission.--The Director shall 
     establish a deadline for an enterprise to comply with any 
     remedial action or submit a housing plan to the Director, 
     which may not be more than 45 days after the enterprise is 
     provided notice. The Director may extend the deadline to the 
     extent that the Director determines necessary. Any extension 
     of the deadline shall be in writing and for a time certain.
       ``(4) Approval.--The Director shall review each submission 
     by an enterprise, including a housing plan submitted under 
     this subsection, and, not later than 30 days after 
     submission, approve or disapprove the plan or other action. 
     The Director may extend the period for approval or 
     disapproval for a single additional 30-day period if the 
     Director determines it necessary. The Director shall approve 
     any plan that the Director determines is likely to succeed, 
     and conforms with the Federal National Mortgage Association 
     Charter Act or the Federal Home Loan Mortgage Corporation Act 
     (as applicable), this title, and any other applicable 
     provision of law.
       ``(5) Notice of approval and disapproval.--The Director 
     shall provide written notice to any enterprise submitting a 
     housing plan of the approval or disapproval of the plan 
     (which shall include the reasons for any disapproval of the 
     plan) and of any extension of the period for approval or 
     disapproval.
       ``(6) Resubmission.--If the initial housing plan submitted 
     by an enterprise under this section is disapproved, the 
     enterprise shall submit an amended plan acceptable to the 
     Director not later than 15 days after such disapproval, or 
     such longer period that the Director determines is in the 
     public interest.
       ``(7) Additional remedies for failure to meet goals.--In 
     addition to ordering a housing plan under this section, 
     issuing cease and desist orders under section 1341, and 
     ordering civil money penalties under section 1345, the 
     Director may--
       ``(A) seek other actions when an enterprise fails to meet a 
     goal; and
       ``(B) exercise appropriate enforcement authority available 
     to the Director under this Act.''.
       (b) Conforming Amendment.--The heading for subpart C of 
     part 2 of subtitle A of the Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 is amended to read 
     as follows:

                      ``Subpart C--Enforcement''.

       (c) Cease and Desist Proceedings .--
       (1) Repeal.--Section 1341 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4581) is hereby repealed.
       (2) Cease and desist proceedings.--The Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 is 
     amended by inserting before section 1342 the following:

     ``SEC. 1341. CEASE AND DESIST PROCEEDINGS.

       ``(a) Grounds for Issuance.--The Director may issue and 
     serve a notice of charges under this section upon an 
     enterprise if the Director determines that--
       ``(1) the enterprise has failed to meet any housing goal 
     established under subpart B, following a written notice and 
     determination of such failure in accordance with section 
     1336;
       ``(2) the enterprise has failed to submit a report under 
     section 1327, following a notice of such failure, an 
     opportunity for comment by the enterprise, and a final 
     determination by the Director;
       ``(3) the enterprise has failed to submit the information 
     required under subsection (m) or (n) of section 309 of the 
     Federal National Mortgage Association Charter Act, or 
     subsection (e) or (f) of section 307 of the Federal Home Loan 
     Mortgage Corporation Act;
       ``(4) the enterprise has violated any provision of part 2 
     of this title or any order, rule, or regulation under part 2;
       ``(5) the enterprise has failed to submit a housing plan or 
     perform its responsibilities under a remedial order that 
     substantially complies with section 1336(c) within the 
     applicable period; or
       ``(6) the enterprise has failed to comply with a housing 
     plan under section 1336(c).
       ``(b) Procedure.--
       ``(1) Notice of charges.--Each notice of charges issued 
     under this section shall contain a statement of the facts 
     constituting the alleged conduct and shall fix a time and 
     place at which a hearing will be held to determine on the 
     record whether an order to cease and desist from such conduct 
     should issue.
       ``(2) Issuance of order.--If the Director finds on the 
     record made at a hearing described in paragraph (1) that any 
     conduct specified in the notice of charges has been 
     established (or the enterprise consents pursuant to section 
     1342(a)(4)), the Director may issue and serve upon the 
     enterprise an order requiring the enterprise to--
       ``(A) comply with the goals;
       ``(B) submit a report under section 1327;
       ``(C) comply with any provision of part 2 of this title or 
     any order, rule, or regulation under part 2;
       ``(D) submit a housing plan in compliance with section 
     1336(c);
       ``(E) comply with the housing plan in compliance with 
     section 1336(c); or
       ``(F) provide the information required under subsection (m) 
     or (n) of section 309 of the Federal National Mortgage 
     Association Charter Act, or subsection (e) or (f) of section 
     307 of the Federal Home Loan Mortgage Corporation Act.
       ``(c) Effective Date.--An order under this section shall 
     become effective upon the expiration of the 30-day period 
     beginning on the date of service of the order upon the 
     enterprise (except in the case of an order issued upon 
     consent, which shall become effective at the time specified 
     therein), and shall remain effective and enforceable as 
     provided in the order, except to the extent that the order is 
     stayed, modified, terminated, or set aside by action of the 
     Director or otherwise, as provided in this subpart.''.
       (d) Civil Money Penalties.--
       (1) Repeal.--Section 1345 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4585) is hereby repealed.
       (2) Civil money penalties.--The Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 is amended by 
     inserting after section 1344 the following:

     ``SEC. 1345. CIVIL MONEY PENALTIES.

       ``(a) Authority.--The Director may impose a civil money 
     penalty, in accordance with the provisions of this section, 
     on any enterprise that has failed to--
       ``(1) meet any housing goal established under subpart B, 
     following a written notice and determination of such failure 
     in accordance with section 1336(b);
       ``(2) submit a report under section 1327, following a 
     notice of such failure, an opportunity for comment by the 
     enterprise, and a final determination by the Director;
       ``(3) submit the information required under subsection (m) 
     or (n) of section 309 of the Federal National Mortgage 
     Association Charter Act or subsection (e) or (f) of section 
     307 of the Federal Home Loan Mortgage Corporation Act;
       ``(4) comply with any provision of part 2 of this title or 
     any order, rule, or regulation under part 2;
       ``(5) submit a housing plan or perform its responsibilities 
     under a remedial order issued pursuant to section 1336(c) 
     within the required period; or
       ``(6) comply with a housing plan for the enterprise under 
     section 1336(c).
       ``(b) Amount of Penalty.--The amount of a penalty under 
     this section, as determined by the Director, may not exceed--
       ``(1) for any failure described in paragraph (1), (5), or 
     (6) of subsection (a), $100,000 for each day that the failure 
     occurs; and
       ``(2) for any failure described in paragraph (2), (3), or 
     (4) of subsection (a), $50,000 for each day that the failure 
     occurs.
       ``(c) Procedures.--
       ``(1) Establishment.--The Director shall establish 
     standards and procedures governing the imposition of civil 
     money penalties under this section. Such standards and 
     procedures--
       ``(A) shall provide for the Director to notify the 
     enterprise in writing of the determination of the Director to 
     impose the penalty, which shall be made on the record;
       ``(B) shall provide for the imposition of a penalty only 
     after the enterprise has been given an opportunity for a 
     hearing on the record pursuant to section 1342; and
       ``(C) may provide for review by the Director of any 
     determination or order, or interlocutory ruling, arising from 
     a hearing.
       ``(2) Factors in determining amount of penalty.--In 
     determining the amount of a penalty under this section, the 
     Director shall give consideration to factors including--

[[Page S6049]]

       ``(A) the gravity of the offense;
       ``(B) any history of prior offenses;
       ``(C) ability to pay the penalty;
       ``(D) injury to the public;
       ``(E) benefits received;
       ``(F) deterrence of future violations;
       ``(G) the length of time that the enterprise should 
     reasonably take to achieve the goal; and
       ``(H) such other factors as the Director may determine, by 
     regulation, to be appropriate.
       ``(d) Action to Collect Penalty.--If an enterprise fails to 
     comply with an order by the Director imposing a civil money 
     penalty under this section, after the order is no longer 
     subject to review, as provided in sections 1342 and 1343, the 
     Director may bring an action in the United States District 
     Court for the District of Columbia to obtain a monetary 
     judgment against the enterprise, and such other relief as may 
     be available. The monetary judgment may, in the court's 
     discretion, include the attorneys' fees and other expenses 
     incurred by the United States in connection with the action. 
     In an action under this subsection, the validity and 
     appropriateness of the order imposing the penalty shall not 
     be subject to review.
       ``(e) Settlement by Director.--The Director may compromise, 
     modify, or remit any civil money penalty which may be, or has 
     been, imposed under this section.
       ``(f) Deposit of Penalties.--The Director shall use any 
     civil money penalties collected under this section to help 
     fund the Housing Trust Fund established under section 
     1338.''.
       (e) Director Authority.--
       (1) Authority to bring a civil action.--Section 1344(a) of 
     the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992 (12 U.S.C. 4584) is amended by striking 
     ``The Secretary may request the Attorney General of the 
     United States to bring a civil action'' and inserting ``The 
     Director may bring a civil action''.
       (2) Subpoena enforcement.--Section 1348(c) of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4588(c)) is amended by inserting ``may bring 
     an action or'' before ``may request''.
       (3) Conforming amendments.--Subpart C of part 2 of subtitle 
     A of the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992 (12 U.S.C. 4581 et seq.) is amended by 
     striking ``Secretary'' each place that term appears and 
     inserting ``Director'' in each of--
       (A) section 1342 (12 U.S.C. 4582);
       (B) section 1343 (12 U.S.C. 4583);
       (C) section 1346 (12 U.S.C. 4586);
       (D) section 1347 (12 U.S.C. 4587); and
       (E) section 1348 (12 U.S.C. 4588).

     SEC. 1131. AFFORDABLE HOUSING PROGRAMS.

       (a) Repeal.--Section 1337 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4567) is hereby repealed.
       (b) Housing Trust Funds.--The Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 (12 U.S.C. 1301 et 
     seq.) is amended by inserting after section 1336 the 
     following:

     ``SEC. 1337. AFFORDABLE HOUSING APPROPRIATIONS.

       ``(a) Authorization of Appropriations.--
       ``(1) In general.--There are authorized to be appropriated 
     such sums as are necessary to carry out the provisions of 
     sections 1338 and 1339.
       ``(2) Allocation.--Of the amounts authorized to be 
     appropriated under paragraph (1)--
       ``(A) 65 percent of such amounts shall be allocated to the 
     Secretary of Housing and Urban Development to fund the 
     Housing Trust Fund established under section 1338; and
       ``(B) 35 percent of such amounts shall be allocated to fund 
     the Capital Magnet Fund established pursuant to section 1339.
       ``(b) Required Amount for HOPE Reserve Fund.--Of the 
     aggregate amount allocated under subsection (a), 25 percent 
     shall be deposited into a fund established in the Treasury of 
     the United States by the Secretary of the Treasury for such 
     purpose.
       ``(c) Limitation.--No funds under this title may be used in 
     conjunction with property taken by eminent domain, unless 
     eminent domain is employed only for a public use, except 
     that, for purposes of this section, public use shall not be 
     construed to include economic development that primarily 
     benefits any private entity.

     ``SEC. 1338. HOUSING TRUST FUND.

       ``(a) Establishment and Purpose.--The Secretary of Housing 
     and Urban Development (in this section referred to as the 
     `Secretary') shall establish and manage a Housing Trust Fund, 
     which shall be funded with amounts appropriated under section 
     1337 and any amounts as are or may be transferred or credited 
     to such Housing Trust Fund under any other provisions of law. 
     The purpose of the Housing Trust Fund under this section is 
     to provide grants to States for use--
       ``(1) to increase and preserve the supply of rental housing 
     for extremely low- and very low-income families, including 
     homeless families; and
       ``(2) to increase homeownership for extremely low- and very 
     low-income families.
       ``(b) Allocations for HOPE Bond Payments.--
       ``(1) In general.--Notwithstanding subsection (c), to help 
     address the mortgage crisis, of the amounts appropriated 
     under section 1337(a) in excess of amounts described in 
     section 1337(b)--
       ``(A) 100 percent of such excess shall be used to reimburse 
     the Treasury for payments made pursuant to section 
     257(w)(1)(C) of the National Housing Act in calendar year 
     2009;
       ``(B) 50 percent of such excess shall be used to reimburse 
     the Treasury for such payments in calendar year 2010; and
       ``(C) 25 percent of such excess shall be used to reimburse 
     the Treasury for such payments in calendar year 2011.
       ``(2) Excess funds.--At the termination of the HOPE for 
     Homeowners Program established under section 257 of the 
     National Housing Act, if amounts used to reimburse the 
     Treasury under paragraph (1) exceed the total net cost to the 
     Government of the HOPE for Homeowners Program, such amounts 
     shall be used for their original purpose, as described in 
     subparagraphs (A) and (B) of section 1337(a)(2).
       ``(3) Treasury fund.--The amounts referred to in 
     subparagraphs (A) through (C) of paragraph (1) shall be 
     deposited into a fund established in the Treasury of the 
     United States by the Secretary of the Treasury for such 
     purpose.
       ``(c) Allocation for Housing Trust Fund in Fiscal Year 2010 
     and Subsequent Years.--
       ``(1) In general.--Except as provided in subsection (b), 
     the Secretary shall distribute the amounts appropriated for 
     the Housing Trust Fund under this section to provide 
     affordable housing as described in this subsection.
       ``(2) Permissible designees.--A State receiving grant 
     amounts under this subsection may designate a State housing 
     finance agency, housing and community development entity, 
     tribally designated housing entity (as such term is defined 
     in section 4 of the Native American Housing Assistance and 
     Self-Determination Act of 1997 (25 U.S.C. 4103)), or any 
     other qualified instrumentality of the State to receive such 
     grant amounts.
       ``(3) Distribution to states by needs-based formula.--
       ``(A) In general.--The Secretary shall, by regulation, 
     establish a formula within 12 months of the date of enactment 
     of the Federal Housing Finance Regulatory Reform Act of 2008, 
     to distribute amounts made available under this subsection to 
     each State to provide affordable housing to extremely low- 
     and very low-income households.
       ``(B) Basis for formula.--The formula required under 
     subparagraph (A) shall include the following:
       ``(i) The ratio of the shortage of standard rental units 
     both affordable and available to extremely low-income renter 
     households in the State to the aggregate shortage of standard 
     rental units both affordable and available to extremely low-
     income renter households in all the States.
       ``(ii) The ratio of the shortage of standard rental units 
     both affordable and available to very low-income renter 
     households in the State to the aggregate shortage of standard 
     rental units both affordable and available to very low-income 
     renter households in all the States.
       ``(iii) The ratio of extremely low-income renter households 
     in the State living with either (I) incomplete kitchen or 
     plumbing facilities, (II) more than 1 person per room, or 
     (III) paying more than 50 percent of income for housing 
     costs, to the aggregate number of extremely low-income renter 
     households living with either (IV) incomplete kitchen or 
     plumbing facilities, (V) more than 1 person per room, or (VI) 
     paying more than 50 percent of income for housing costs in 
     all the States.
       ``(iv) The ratio of very low-income renter households in 
     the State paying more than 50 percent of income on rent 
     relative to the aggregate number of very low-income renter 
     households paying more than 50 percent of income on rent in 
     all the States.
       ``(v) The resulting sum calculated from the factors 
     described in clauses (i) through (iv) shall be multiplied by 
     the relative cost of construction in the State. For purposes 
     of this subclause, the term `cost of construction'--

       ``(I) means the cost of construction or building 
     rehabilitation in the State relative to the national cost of 
     construction or building rehabilitation; and
       ``(II) shall be calculated such that values higher than 1.0 
     indicate that the State's construction costs are higher than 
     the national average, a value of 1.0 indicates that the 
     State's construction costs are exactly the same as the 
     national average, and values lower than 1.0 indicate that the 
     State's cost of construction are lower than the national 
     average.

       ``(C) Priority.--The formula required under subparagraph 
     (A) shall give priority emphasis and consideration to the 
     factor described in subparagraph (B)(i).
       ``(4) Allocation of grant amounts.--
       ``(A) Notice.--Not later than 60 days after the date that 
     the Secretary determines the formula amounts described in 
     paragraph (3), the Secretary shall caused to be published in 
     the Federal Register a notice that such amounts shall be so 
     available.
       ``(B) Grant amount.--In each fiscal year other than fiscal 
     year 2009, the Secretary shall make a grant to each State in 
     an amount that is equal to the formula amount determined 
     under paragraph (3) for that State.
       ``(C) Minimum state allocations.--If the formula amount 
     determined under paragraph (3) for a fiscal year would 
     allocate less than $3,000,000 to any State, the allocation 
     for such State shall be $3,000,000, and the increase shall be 
     deducted pro rata from the allocations made to all other 
     States.

[[Page S6050]]

       ``(5) Allocation plans required.--
       ``(A) In general.--For each year that a State or State 
     designated entity receives a grant under this subsection, the 
     State or State designated entity shall establish an 
     allocation plan. Such plan shall--
       ``(i) set forth a plan for the distribution of grant 
     amounts received by the State or State designated entity for 
     such year;
       ``(ii) be based on priority housing needs, as determined by 
     the State or State designated entity in accordance with the 
     regulations established under subsection (g)(2)(C);
       ``(iii) comply with paragraph (6); and
       ``(iv) include performance goals that comply with the 
     requirements established by the Secretary pursuant to 
     subsection (g)(2).
       ``(B) Establishment.--In establishing an allocation plan 
     under this paragraph, a State or State designated entity 
     shall--
       ``(i) notify the public of the establishment of the plan;
       ``(ii) provide an opportunity for public comments regarding 
     the plan;
       ``(iii) consider any public comments received regarding the 
     plan; and
       ``(iv) make the completed plan available to the public.
       ``(C) Contents.--An allocation plan of a State or State 
     designated entity under this paragraph shall set forth the 
     requirements for eligible recipients under paragraph (8) to 
     apply for such grant amounts, including a requirement that 
     each such application include--
       ``(i) a description of the eligible activities to be 
     conducted using such assistance; and
       ``(ii) a certification by the eligible recipient applying 
     for such assistance that any housing units assisted with such 
     assistance will comply with the requirements under this 
     section.
       ``(6) Selection of activities funded using housing trust 
     fund grant amounts.--Grant amounts received by a State or 
     State designated entity under this subsection may be used, or 
     committed for use, only for activities that--
       ``(A) are eligible under paragraph (7) for such use;
       ``(B) comply with the applicable allocation plan of the 
     State or State designated entity under paragraph (5); and
       ``(C) are selected for funding by the State or State 
     designated entity in accordance with the process and criteria 
     for such selection established pursuant to subsection 
     (g)(2)(C).
       ``(7) Eligible activities.--Grant amounts allocated to a 
     State or State designated entity under this subsection shall 
     be eligible for use, or for commitment for use, only for 
     assistance for--
       ``(A) the production, preservation, and rehabilitation of 
     rental housing, including housing under the programs 
     identified in section 1335(a)(2)(B) and for operating costs, 
     except that not less than 75 percent of such grant amounts 
     shall be used for the benefit only of extremely low-income 
     families and not more than 25 percent for the benefit only of 
     very low-income families; and
       ``(B) the production, preservation, and rehabilitation of 
     housing for homeownership, including such forms as down 
     payment assistance, closing cost assistance, and assistance 
     for interest rate buy-downs, that--
       ``(i) is available for purchase only for use as a principal 
     residence by families that qualify both as--

       ``(I) extremely low- and very low-income families at the 
     times described in subparagraphs (A) through (C) of section 
     215(b)(2) of the Cranston-Gonzalez National Affordable 
     Housing Act (42 U.S.C. 12745(b)(2)); and
       ``(II) first-time homebuyers, as such term is defined in 
     section 104 of the Cranston-Gonzalez National Affordable 
     Housing Act (42 U.S.C. 12704), except that any reference in 
     such section to assistance under title II of such Act shall 
     for purposes of this subsection be considered to refer to 
     assistance from affordable housing fund grant amounts;

       ``(ii) has an initial purchase price that meets the 
     requirements of section 215(b)(1) of the Cranston-Gonzalez 
     National Affordable Housing Act;
       ``(iii) is subject to the same resale restrictions 
     established under section 215(b)(3) of the Cranston-Gonzalez 
     National Affordable Housing Act and applicable to the 
     participating jurisdiction that is the State in which such 
     housing is located; and
       ``(iv) is made available for purchase only by, or in the 
     case of assistance under this subsection, is made available 
     only to homebuyers who have, before purchase completed a 
     program of independent financial education and counseling 
     from an eligible organization that meets the requirements of 
     section 132 of the Federal Housing Finance Regulatory Reform 
     Act of 2008.
       ``(8) Eligible recipients.--Grant amounts allocated to a 
     State or State designated entity under this subsection may be 
     provided only to a recipient that is an organization, agency, 
     or other entity (including a for-profit entity or a nonprofit 
     entity) that--
       ``(A) has demonstrated experience and capacity to conduct 
     an eligible activity under paragraph (7), as evidenced by its 
     ability to--
       ``(i) own, construct or rehabilitate, manage, and operate 
     an affordable multifamily rental housing development;
       ``(ii) design, construct or rehabilitate, and market 
     affordable housing for homeownership; or
       ``(iii) provide forms of assistance, such as down payments, 
     closing costs, or interest rate buy-downs for purchasers;
       ``(B) demonstrates the ability and financial capacity to 
     undertake, comply, and manage the eligible activity;
       ``(C) demonstrates its familiarity with the requirements of 
     any other Federal, State, or local housing program that will 
     be used in conjunction with such grant amounts to ensure 
     compliance with all applicable requirements and regulations 
     of such programs; and
       ``(D) makes such assurances to the State or State 
     designated entity as the Secretary shall, by regulation, 
     require to ensure that the recipient will comply with the 
     requirements of this subsection during the entire period that 
     begins upon selection of the recipient to receive such grant 
     amounts and ending upon the conclusion of all activities 
     under paragraph (8) that are engaged in by the recipient and 
     funded with such grant amounts.
       ``(9) Limitations on use.--
       ``(A) Required amount for homeownership activities.--Of the 
     aggregate amount allocated to a State or State designated 
     entity under this subsection not more than 10 percent shall 
     be used for activities under subparagraph (B) of paragraph 
     (7).
       ``(B) Deadline for commitment or use.--Grant amounts 
     allocated to a State or State designated entity under this 
     subsection shall be used or committed for use within 2 years 
     of the date that such grant amounts are made available to the 
     State or State designated entity. The Secretary shall 
     recapture any such amounts not so used or committed for use 
     and reallocate such amounts under this subsection in the 
     first year after such recapture.
       ``(C) Use of returns.--The Secretary shall, by regulation, 
     provide that any return on a loan or other investment of any 
     grant amount used by a State or State designated entity to 
     provide a loan under this subsection shall be treated, for 
     purposes of availability to and use by the State or State 
     designated entity, as a grant amount authorized under this 
     subsection.
       ``(D) Prohibited uses.--The Secretary shall, by 
     regulation--
       ``(i) set forth prohibited uses of grant amounts allocated 
     under this subsection, which shall include use for--

       ``(I) political activities;
       ``(II) advocacy;
       ``(III) lobbying, whether directly or through other 
     parties;
       ``(IV) counseling services;
       ``(V) travel expenses; and
       ``(VI) preparing or providing advice on tax returns;

       ``(ii) provide that, except as provided in clause (iii), 
     grant amounts of a State or State designated entity may not 
     be used for administrative, outreach, or other costs of--

       ``(I) the State or State designated entity; or
       ``(II) any other recipient of such grant amounts; and

       ``(iii) limit the amount of any grant amounts for a year 
     that may be used by the State or State designated entity for 
     administrative costs of carrying out the program required 
     under this subsection, including home ownership counseling, 
     to a percentage of such grant amounts of the State or State 
     designated entity for such year, which may not exceed 10 
     percent.
       ``(E) Prohibition of consideration of use for meeting 
     housing goals or duty to serve.--In determining compliance 
     with the housing goals under this subpart and the duty to 
     serve underserved markets under section 1335, the Director 
     may not consider any grant amounts used under this section 
     for eligible activities under paragraph (7). The Director 
     shall give credit toward the achievement of such housing 
     goals and such duty to serve underserved markets to purchases 
     by the enterprises of mortgages for housing that receives 
     funding from such grant amounts, but only to the extent that 
     such purchases by the enterprises are funded other than with 
     such grant amounts.
       ``(d) Reduction for Failure to Obtain Return of Misused 
     Funds.--If in any year a State or State designated entity 
     fails to obtain reimbursement or return of the full amount 
     required under subsection (e)(1)(B) to be reimbursed or 
     returned to the State or State designated entity during such 
     year--
       ``(1) except as provided in paragraph (2)--
       ``(A) the amount of the grant for the State or State 
     designated entity for the succeeding year, as determined 
     pursuant to this section, shall be reduced by the amount by 
     which such amounts required to be reimbursed or returned 
     exceed the amount actually reimbursed or returned; and
       ``(B) the amount of the grant for the succeeding year for 
     each other State or State designated entity whose grant is 
     not reduced pursuant to subparagraph (A) shall be increased 
     by the amount determined by applying the formula established 
     pursuant to this section to the total amount of all 
     reductions for all State or State designated entities for 
     such year pursuant to subparagraph (A); or
       ``(2) in any case in which such failure to obtain 
     reimbursement or return occurs during a year immediately 
     preceding a year in which grants under this section will not 
     be made, the State or State designated entity shall pay to 
     the Secretary for reallocation among the other grantees an 
     amount equal to the amount of the reduction for the entity 
     that would otherwise apply under paragraph (1)(A).
       ``(e) Accountability of Recipients and Grantees.--
       ``(1) Recipients.--
       ``(A) Tracking of funds.--The Secretary shall--

[[Page S6051]]

       ``(i) require each State or State designated entity to 
     develop and maintain a system to ensure that each recipient 
     of assistance under this section uses such amounts in 
     accordance with this section, the regulations issued under 
     this section, and any requirements or conditions under which 
     such amounts were provided; and
       ``(ii) establish minimum requirements for agreements, 
     between the State or State designated entity and recipients, 
     regarding assistance under this section, which shall 
     include--

       ``(I) appropriate periodic financial and project reporting, 
     record retention, and audit requirements for the duration of 
     the assistance to the recipient to ensure compliance with the 
     limitations and requirements of this section and the 
     regulations under this section; and
       ``(II) any other requirements that the Secretary determines 
     are necessary to ensure appropriate administration and 
     compliance.

       ``(B) Misuse of funds.--
       ``(i) Reimbursement requirement.--If any recipient of 
     assistance under this section is determined, in accordance 
     with clause (ii), to have used any such amounts in a manner 
     that is materially in violation of this section, the 
     regulations issued under this section, or any requirements or 
     conditions under which such amounts were provided, the State 
     or State designated entity shall require that, within 12 
     months after the determination of such misuse, the recipient 
     shall reimburse the State or State designated entity for such 
     misused amounts and return to the State or State designated 
     entity any such amounts that remain unused or uncommitted for 
     use. The remedies under this clause are in addition to any 
     other remedies that may be available under law.
       ``(ii) Determination.--A determination is made in 
     accordance with this clause if the determination is made by 
     the Secretary or made by the State or State designated 
     entity, provided that--

       ``(I) the State or State designated entity provides 
     notification of the determination to the Secretary for 
     review, in the discretion of the Secretary, of the 
     determination; and
       ``(II) the Secretary does not subsequently reverse the 
     determination.

       ``(2) Grantees.--
       ``(A) Report.--
       ``(i) In general.--The Secretary shall require each State 
     or State designated entity receiving grant amounts in any 
     given year under this section to submit a report, for such 
     year, to the Secretary that--

       ``(I) describes the activities funded under this section 
     during such year with such grant amounts; and
       ``(II) the manner in which the State or State designated 
     entity complied during such year with any allocation plan 
     established pursuant to subsection (c).

       ``(ii) Public availability.--The Secretary shall make such 
     reports pursuant to this subparagraph publicly available.
       ``(B) Misuse of funds.--If the Secretary determines, after 
     reasonable notice and opportunity for hearing, that a State 
     or State designated entity has failed to comply substantially 
     with any provision of this section, and until the Secretary 
     is satisfied that there is no longer any such failure to 
     comply, the Secretary shall--
       ``(i) reduce the amount of assistance under this section to 
     the State or State designated entity by an amount equal to 
     the amount of grant amounts which were not used in accordance 
     with this section;
       ``(ii) require the State or State designated entity to 
     repay the Secretary any amount of the grant which was not 
     used in accordance with this section;
       ``(iii) limit the availability of assistance under this 
     section to the State or State designated entity to activities 
     or recipients not affected by such failure to comply; or
       ``(iv) terminate any assistance under this section to the 
     State or State designated entity.
       ``(f) Definitions.--For purposes of this section, the 
     following definitions shall apply:
       ``(1) Extremely low-income renter household.--The term 
     `extremely low-income renter household' means a household 
     whose income is not in excess of 30 percent of the area 
     median income, with adjustments for smaller and larger 
     families, as determined by the Secretary.
       ``(2) Recipient.--The term `recipient' means an individual 
     or entity that receives assistance from a State or State 
     designated entity from amounts made available to the State or 
     State designated entity under this section.
       ``(3) Shortage of standard rental units both affordable and 
     available to extremely low-income renter households.--
       ``(A) In general.--The term `shortage of standard rental 
     units both affordable and available to extremely low-income 
     renter households' means for any State or other geographical 
     area the gap between--
       ``(i) the number of units with complete plumbing and 
     kitchen facilities with a rent that is 30 percent or less of 
     30 percent of the adjusted area median income as determined 
     by the Secretary that are occupied by extremely low-income 
     renter households or are vacant for rent; and
       ``(ii) the number of extremely low-income renter 
     households.
       ``(B) Rule of construction.--If the number of units 
     described in subparagraph (A)(i) exceeds the number of 
     extremely low-income households as described in subparagraph 
     (A)(ii), there is no shortage.
       ``(4) Shortage of standard rental units both affordable and 
     available to very low-income renter households.--
       ``(A) In general.--The term `shortage of standard rental 
     units both affordable and available to very low-income renter 
     households' means for any State or other geographical area 
     the gap between--
       ``(i) the number of units with complete plumbing and 
     kitchen facilities with a rent that is 30 percent or less of 
     50 percent of the adjusted area median income as determined 
     by the Secretary that are occupied by very low-income renter 
     households or are vacant for rent; and
       ``(ii) the number of very low-income renter households.
       ``(B) Rule of construction.--If the number of units 
     described in subparagraph (A)(i) exceeds the number of very 
     low-income households as described in subparagraph (A)(ii), 
     there is no shortage.
       ``(5) Very low-income family.--The term `very low-income 
     family' has the meaning given such term in section 1303, 
     except that such term includes any family that resides in a 
     rural area that has an income that does not exceed the 
     poverty line (as such term is defined in section 673(2) of 
     the Omnibus Budget Reconciliation Act of 1981 (42 U.S.C. 
     9902(2)), including any revision required by such section) 
     applicable to a family of the size involved.
       ``(6) Very low-income renter households.--The term `very 
     low-income renter households' means a household whose income 
     is in excess of 30 percent but not greater than 50 percent of 
     the area median income, with adjustments for smaller and 
     larger families, as determined by the Secretary.
       ``(g) Regulations.--
       ``(1) In general.--The Secretary shall issue regulations to 
     carry out this section.
       ``(2) Required contents.--The regulations issued under this 
     subsection shall include--
       ``(A) a requirement that the Secretary ensure that the use 
     of grant amounts under this section by States or State 
     designated entities is audited not less than annually to 
     ensure compliance with this section;
       ``(B) authority for the Secretary to audit, provide for an 
     audit, or otherwise verify a State or State designated 
     entity's activities to ensure compliance with this section;
       ``(C) requirements for a process for application to, and 
     selection by, each State or State designated entity for 
     activities meeting the State or State designated entity's 
     priority housing needs to be funded with grant amounts under 
     this section, which shall provide for priority in funding to 
     be based upon--
       ``(i) geographic diversity;
       ``(ii) ability to obligate amounts and undertake activities 
     so funded in a timely manner;
       ``(iii) in the case of rental housing projects under 
     subsection (c)(7)(A), the extent to which rents for units in 
     the project funded are affordable, especially for extremely 
     low-income families;
       ``(iv) in the case of rental housing projects under 
     subsection (c)(7)(A), the extent of the duration for which 
     such rents will remain affordable;
       ``(v) the extent to which the application makes use of 
     other funding sources; and
       ``(vi) the merits of an applicant's proposed eligible 
     activity;
       ``(D) requirements to ensure that grant amounts provided to 
     a State or State designated entity under this section that 
     are used for rental housing under subsection (c)(7)(A) are 
     used only for the benefit of extremely low- and very low-
     income families; and
       ``(E) requirements and standards for establishment, by a 
     State or State designated entity, for use of grant amounts in 
     2009 and subsequent years of performance goals, benchmarks, 
     and timetables for the production, preservation, and 
     rehabilitation of affordable rental and homeownership housing 
     with such grant amounts.
       ``(h) Affordable Housing Trust Fund.--If, after the date of 
     enactment of the Federal Housing Finance Regulatory Reform 
     Act of 2008, in any year, there is enacted any provision of 
     Federal law establishing an affordable housing trust fund 
     other than under this title for use only for grants to 
     provide affordable rental housing and affordable 
     homeownership opportunities, and the subsequent year is a 
     year referred to in subsection (c), the Secretary shall in 
     such subsequent year and any remaining years referred to in 
     subsection (c) transfer to such affordable housing trust fund 
     the aggregate amount allocated pursuant to subsection (c) in 
     such year. Notwithstanding any other provision of law, 
     assistance provided using amounts transferred to such 
     affordable housing trust fund pursuant to this subsection may 
     not be used for any of the activities specified in clauses 
     (i) through (vi) of subsection (c)(9)(D).
       ``(i) Funding Accountability and Transparency.--Any grant 
     under this section to a grantee by a State or State 
     designated entity, any assistance provided to a recipient by 
     a State or State designated entity, and any grant, award, or 
     other assistance from an affordable housing trust fund 
     referred to in subsection (h) shall be considered a Federal 
     award for purposes of the Federal Funding Accountability and 
     Transparency Act of 2006 (31 U.S.C. 6101 note). Upon the 
     request of the Director of the Office of Management and 
     Budget, the Secretary shall obtain and provide such 
     information regarding any such

[[Page S6052]]

     grants, assistance, and awards as the Director of the Office 
     of Management and Budget considers necessary to comply with 
     the requirements of such Act, as applicable, pursuant to the 
     preceding sentence.

     ``SEC. 1339. CAPITAL MAGNET FUND.

       ``(a) Establishment.--There is established in the Treasury 
     of the United States a trust fund to be known as the Capital 
     Magnet Fund, which shall be a special account within the 
     Community Development Financial Institutions Fund.
       ``(b) Deposits to Trust Fund.--The Capital Magnet Fund 
     shall consist of--
       ``(1) any amounts appropriated to the Fund pursuant to 
     section 1337(a); and
       ``(2) any amounts as are or may be transferred or credited 
     to such Fund under any other provisions of law.''.
       ``(c) Expenditures From Trust Fund.--Amounts in the Capital 
     Magnet Fund shall be available to the Secretary of the 
     Treasury to carry out a competitive grant program to attract 
     private capital for and increase investment in--
       ``(1) the development, preservation, rehabilitation, or 
     purchase of affordable housing for primarily extremely low-, 
     very low-, and low-income families; and
       ``(2) economic development activities or community service 
     facilities, such as day care centers, workforce development 
     centers, and health care clinics, which in conjunction with 
     affordable housing activities implement a concerted strategy 
     to stabilize or revitalize a low-income area or underserved 
     rural area.
       ``(d) Federal Assistance.--All assistance provided using 
     amounts in the Capital Magnet Fund shall be considered to be 
     Federal financial assistance.
       ``(e) Eligible Grantees.--A grant under this section may be 
     made, pursuant to such requirements as the Secretary of the 
     Treasury shall establish for experience and success in 
     attracting private financing and carrying out the types of 
     activities proposed under the application of the grantee, 
     only to--
       ``(1) a Treasury certified community development financial 
     institution; or
       ``(2) a nonprofit organization having as 1 of its principal 
     purposes the development or management of affordable housing.
       ``(f) Eligible Uses.--Grant amounts awarded from the 
     Capital Magnet Fund pursuant to this section may be used for 
     the purposes described in paragraphs (1) and (2) of 
     subsection (c), including for the following uses:
       ``(1) To provide loan loss reserves.
       ``(2) To capitalize a revolving loan fund.
       ``(3) To capitalize an affordable housing fund.
       ``(4) To capitalize a fund to support activities described 
     in subsection (c)(2).
       ``(5) For risk-sharing loans.
       ``(g) Applications.--
       ``(1) In general.--The Secretary of the Treasury shall 
     provide, in a competitive application process established by 
     regulation, for eligible grantees under subsection (e) to 
     submit applications for Capital Magnet Fund grants to the 
     Secretary at such time and in such manner as the Secretary 
     shall determine.
       ``(2) Content of application.--The application required 
     under paragraph (1) shall include a detailed description of--
       ``(A) the types of affordable housing, economic, and 
     community revitalization projects that support or sustain 
     residents of an affordable housing project funded by a grant 
     under this section for which such grant amounts would be 
     used, including the proposed use of eligible grants as 
     authorized under this section;
       ``(B) the types, sources, and amounts of other funding for 
     such projects; and
       ``(C) the expected time frame of any grant used for such 
     project.
       ``(h) Grant Limitation.--
       ``(1) In general.--Any 1 eligible grantee and its 
     subsidiaries and affiliates may not be awarded more than 15 
     percent of the aggregate funds available for grants during 
     any year from the Capital Magnet Fund.
       ``(2) Geographic diversity.--
       ``(A) Goal.--The Secretary of the Treasury shall seek to 
     fund activities in geographically diverse areas of economic 
     distress, including metropolitan and underserved rural areas 
     in every State.
       ``(B) Diversity defined.--For purposes of this paragraph, 
     geographic diversity includes those areas that meet objective 
     criteria of economic distress developed by the Secretary of 
     the Treasury, which may include--
       ``(i) the percentage of low-income families or the extent 
     of poverty;
       ``(ii) the rate of unemployment or underemployment;
       ``(iii) extent of blight and disinvestment;
       ``(iv) projects that target extremely low-, very low-, and 
     low-income families in or outside a designated economic 
     distress area; or
       ``(v) any other criteria designated by the Secretary of the 
     Treasury.
       ``(3) Leverage of funds.--Each grant from the Capital 
     Magnet Fund awarded under this section shall be reasonably 
     expected to result in eligible housing, or economic and 
     community development projects that support or sustain an 
     affordable housing project funded by a grant under this 
     section whose aggregate costs total at least 10 times the 
     grant amount.
       ``(4) Commitment for use deadline.--Amounts made available 
     for grants under this section shall be committed for use 
     within 2 years of the date of such allocation. The Secretary 
     of the Treasury shall recapture into the Capital Magnet Fund 
     any amounts not so used or committed for use and allocate 
     such amounts in the first year after such recapture.
       ``(5) Lobbying restrictions.--No assistance or amounts made 
     available under this section may be expended by an eligible 
     grantee to pay any person to influence or attempt to 
     influence any agency, elected official, officer or employee 
     of a State or local government in connection with the making, 
     award, extension, continuation, renewal, amendment, or 
     modification of any State or local government contract, 
     grant, loan, or cooperative agreement as such terms are 
     defined in section 1352 of title 31, United States Code.
       ``(6) Prohibition of consideration of use for meeting 
     housing goals or duty to serve.--In determining the 
     compliance of the enterprises with the housing goals under 
     this section and the duty to serve underserved markets under 
     section 1335, the Director of the Federal Housing Finance 
     Agency may not consider any Capital Magnet Fund amounts used 
     under this section for eligible activities under subsection 
     (f). The Director of the Federal Housing Finance Agency shall 
     give credit toward the achievement of such housing goals and 
     such duty to serve underserved markets to purchases by the 
     enterprises of mortgages for housing that receives funding 
     from Capital Magnet Fund grant amounts, but only to the 
     extent that such purchases by the enterprises are funded 
     other than with such grant amounts.
       ``(7) Accountability of recipients and grantees.--
       ``(A) Tracking of funds.--The Secretary of the Treasury 
     shall--
       ``(i) require each grantee to develop and maintain a system 
     to ensure that each recipient of assistance from the Capital 
     Magnet Fund uses such amounts in accordance with this 
     section, the regulations issued under this section, and any 
     requirements or conditions under which such amounts were 
     provided; and
       ``(ii) establish minimum requirements for agreements, 
     between the grantee and the Capital Magnet Fund, regarding 
     assistance from the Capital Magnet Fund, which shall 
     include--

       ``(I) appropriate periodic financial and project reporting, 
     record retention, and audit requirements for the duration of 
     the grant to the recipient to ensure compliance with the 
     limitations and requirements of this section and the 
     regulations under this section; and
       ``(II) any other requirements that the Secretary determines 
     are necessary to ensure appropriate grant administration and 
     compliance.

       ``(B) Misuse of funds.--If the Secretary of the Treasury 
     determines, after reasonable notice and opportunity for 
     hearing, that a grantee has failed to comply substantially 
     with any provision of this section and until the Secretary is 
     satisfied that there is no longer any such failure to comply, 
     the Secretary shall--
       ``(i) reduce the amount of assistance under this section to 
     the grantee by an amount equal to the amount of Capital 
     Magnet Fund grant amounts which were not used in accordance 
     with this section;
       ``(ii) require the grantee to repay the Secretary any 
     amount of the Capital Magnet Fund grant amounts which were 
     not used in accordance with this section;
       ``(iii) limit the availability of assistance under this 
     section to the grantee to activities or recipients not 
     affected by such failure to comply; or
       ``(iv) terminate any assistance under this section to the 
     grantee.
       ``(i) Periodic Reports.--
       ``(1) In general.--The Secretary of the Treasury shall 
     submit a report, on a periodic basis, to the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives describing the activities to be funded under 
     this section.
       ``(2) Reports available to public.--The Secretary of the 
     Treasury shall make the reports required under paragraph (1) 
     publicly available.
       ``(j) Regulations.--
       ``(1) In general.--The Secretary of the Treasury shall 
     issue regulations to carry out this section.
       ``(2) Required contents.--The regulations issued under this 
     subsection shall include--
       ``(A) authority for the Secretary to audit, provide for an 
     audit, or otherwise verify an enterprise's activities, to 
     ensure compliance with this section;
       ``(B) a requirement that the Secretary ensure that the 
     allocation of each enterprise is audited not less than 
     annually to ensure compliance with this section; and
       ``(C) requirements for a process for application to, and 
     selection by, the Secretary for activities to be funded with 
     amounts from the Capital Magnet Fund, which shall provide 
     that--
       ``(i) funds be fairly distributed to urban, suburban, and 
     rural areas; and
       ``(ii) selection shall be based upon specific criteria, 
     including a prioritization of funding based upon--

       ``(I) the ability to use such funds to generate additional 
     investments;
       ``(II) affordable housing need (taking into account the 
     distinct needs of different regions of the country); and
       ``(III) ability to obligate amounts and undertake 
     activities so funded in a timely manner.''.

[[Page S6053]]

     SEC. 1132. FINANCIAL EDUCATION AND COUNSELING.

       (a) Goals.--Financial education and counseling under this 
     section shall have the goal of--
       (1) increasing the financial knowledge and decision making 
     capabilities of prospective homebuyers;
       (2) assisting prospective homebuyers to develop monthly 
     budgets, build personal savings, finance or plan for major 
     purchases, reduce their debt, improve their financial 
     stability, and set and reach their financial goals;
       (3) helping prospective homebuyers to improve their credit 
     scores by understanding the relationship between their credit 
     histories and their credit scores; and
       (4) educating prospective homebuyers about the options 
     available to build savings for short- and long-term goals.
       (b) Grants.--
       (1) In general.--The Secretary of the Treasury (in this 
     section referred to as the ``Secretary'') shall make grants 
     to eligible organizations to enable such organizations to 
     provide a range of financial education and counseling 
     services to prospective homebuyers.
       (2) Selection.--The Secretary shall select eligible 
     organizations to receive assistance under this section based 
     on their experience and ability to provide financial 
     education and counseling services that result in documented 
     positive behavioral changes.
       (c) Eligible Organizations.--
       (1) In general.--For purposes of this section, the term 
     ``eligible organization'' means an organization that is--
       (A) certified in accordance with section 106(e)(1) of the 
     Housing and Urban Development Act of 1968 (12 U.S.C. 
     1701x(e)); or
       (B) certified by the Office of Financial Education of the 
     Department of the Treasury for purposes of this section, in 
     accordance with paragraph (2).
       (2) OFE certification.--To be certified by the Office of 
     Financial Education for purposes of this section, an eligible 
     organization shall be--
       (A) a housing counseling agency certified by the Secretary 
     of Housing and Urban Development under section 106(e) of the 
     Housing and Urban Development Act of 1968;
       (B) a State, local, or tribal government agency;
       (C) a community development financial institution (as 
     defined in section 103(5) of the Community Development 
     Banking and Financial Institutions Act of 1994 (12 U.S.C. 
     4702(5)) or a credit union; or
       (D) any collaborative effort of entities described in any 
     of subparagraphs (A) through (C).
       (d) Authority for Pilot Projects.--
       (1) In general.--The Secretary of the Treasury shall 
     authorize not more than 5 pilot project grants to eligible 
     organizations under subsection (c) in order to--
       (A) carry out the services under this section; and
       (B) provide such other services that will improve the 
     financial stability and economic condition of low- and 
     moderate-income and low-wealth individuals.
       (2) Goal.--The goal of the pilot project grants under this 
     subsection is to--
       (A) identify successful methods resulting in positive 
     behavioral change for financial empowerment; and
       (B) establish program models for organizations to carry out 
     effective counseling services.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary such sums as are 
     necessary to carry out this section and for the provision of 
     additional financial educational services.
       (f) Study and Report on Effectiveness and Impact.--
       (1) In general.--The Comptroller General of the United 
     States shall conduct a study on the effectiveness and impact 
     of the grant program established under this section. Not 
     later than 3 years after the date of enactment of this Act, 
     the Comptroller General shall submit a report on the results 
     of such study to the Committee on Banking, Housing, and Urban 
     Affairs of the Senate and the Committee on Financial Services 
     of the House of Representatives.
       (2) Content of study.--The study required under paragraph 
     (1) shall include an evaluation of the following:
       (A) The effectiveness of the grant program established 
     under this section in improving the financial situation of 
     homeowners and prospective homebuyers served by the grant 
     program.
       (B) The extent to which financial education and counseling 
     services have resulted in positive behavioral changes.
       (C) The effectiveness and quality of the eligible 
     organizations providing financial education and counseling 
     services under the grant program.
       (g) Regulations.--The Secretary is authorized to promulgate 
     such regulations as may be necessary to implement and 
     administer the grant program authorized by this section.

     SEC. 1133. TRANSFER AND RIGHTS OF CERTAIN HUD EMPLOYEES.

       (a) Transfer.--Each employee of the Department of Housing 
     and Urban Development whose position responsibilities 
     primarily involve the establishment and enforcement of the 
     housing goals under subpart B of part 2 of subtitle A of the 
     Federal Housing Enterprises Financial Safety and Soundness 
     Act of 1992 (12 U.S.C. 4561 et seq.) shall be transferred to 
     the Federal Housing Finance Agency for employment, not later 
     than the effective date of the Federal Housing Finance 
     Regulatory Reform Act of 2008, and such transfer shall be 
     deemed a transfer of function for purposes of section 3503 of 
     title 5, United States Code.
       (b) Guaranteed Positions.--
       (1) In general.--Each employee transferred under subsection 
     (a) shall be guaranteed a position with the same status, 
     tenure, grade, and pay as that held on the day immediately 
     preceding the transfer.
       (2) No involuntary separation or reduction.--An employee 
     transferred under subsection (a) holding a permanent position 
     on the day immediately preceding the transfer may not be 
     involuntarily separated or reduced in grade or compensation 
     during the 12-month period beginning on the date of transfer, 
     except for cause, or, in the case of a temporary employee, 
     separated in accordance with the terms of the appointment of 
     the employee.
       (c) Appointment Authority for Excepted and Senior Executive 
     Service Employees.--
       (1) In general.--In the case of an employee occupying a 
     position in the excepted service or the Senior Executive 
     Service, any appointment authority established under law or 
     by regulations of the Office of Personnel Management for 
     filling such position shall be transferred, subject to 
     paragraph (2).
       (2) Decline of transfer.--The Director may decline a 
     transfer of authority under paragraph (1) to the extent that 
     such authority relates to--
       (A) a position excepted from the competitive service 
     because of its confidential, policymaking, policy-
     determining, or policy-advocating character; or
       (B) a noncareer position in the Senior Executive Service 
     (within the meaning of section 3132(a)(7) of title 5, United 
     States Code).
       (d) Reorganization.--If the Director determines, after the 
     end of the 1-year period beginning on the effective date of 
     the Federal Housing Finance Regulatory Reform Act of 2008, 
     that a reorganization of the combined workforce is required, 
     that reorganization shall be deemed a major reorganization 
     for purposes of affording affected employee retirement under 
     section 8336(d)(2) or 8414(b)(1)(B) of title 5, United States 
     Code.
       (e) Employee Benefit Programs.--
       (1) In general.--Any employee described under subsection 
     (a) accepting employment with the Agency as a result of a 
     transfer under subsection (a) may retain, for 12 months after 
     the date on which such transfer occurs, membership in any 
     employee benefit program of the Agency or the Department of 
     Housing and Urban Development, as applicable, including 
     insurance, to which such employee belongs on such effective 
     date, if--
       (A) the employee does not elect to give up the benefit or 
     membership in the program; and
       (B) the benefit or program is continued by the Director of 
     the Federal Housing Finance Agency.
       (2) Cost differential.--
       (A) In general.--The difference in the costs between the 
     benefits which would have been provided by the Department of 
     Housing and Urban Development and those provided by this 
     section shall be paid by the Director.
       (B) Health insurance.--If any employee elects to give up 
     membership in a health insurance program or the health 
     insurance program is not continued by the Director, the 
     employee shall be permitted to select an alternate Federal 
     health insurance program not later than 30 days after the 
     date of such election or notice, without regard to any other 
     regularly scheduled open season.

                  Subtitle C--Prompt Corrective Action

     SEC. 1141. CRITICAL CAPITAL LEVELS.

       (a) In General.--Section 1363 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4613) is amended--
       (1) by striking ``For'' and inserting ``(a) Enterprises.--
     For''; and
       (2) by adding at the end the following new subsection:
       ``(b) Federal Home Loan Banks.--
       ``(1) In general.--For purposes of this subtitle, the 
     critical capital level for each Federal Home Loan Bank shall 
     be such amount of capital as the Director shall, by 
     regulation, require.
       ``(2) Consideration of other critical capital levels.--In 
     establishing the critical capital level under paragraph (1) 
     for the Federal Home Loan Banks, the Director shall take due 
     consideration of the critical capital level established under 
     subsection (a) for the enterprises, with such modifications 
     as the Director determines to be appropriate to reflect the 
     difference in operations between the banks and the 
     enterprises.''.
       (b) Regulations.--Not later than the expiration of the 180-
     day period beginning on the date of enactment of this Act, 
     the Director of the Federal Housing Finance Agency shall 
     issue regulations pursuant to section 1363(b) of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (as added by this section) establishing the critical 
     capital level under such section.

     SEC. 1142. CAPITAL CLASSIFICATIONS.

       (a) In General.--Section 1364 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4614) is amended--
       (1) in the heading for subsection (a) by striking ``In 
     General'' and inserting ``Enterprises'';
       (2) in subsection (c)--
       (A) by striking ``subsection (b)'' and inserting 
     ``subsection (c)'';

[[Page S6054]]

       (B) by striking ``enterprises'' and inserting ``regulated 
     entities''; and
       (C) by striking the last sentence;
       (3) by redesignating subsections (c) (as so amended by 
     paragraph (2) of this subsection) and (d) as subsections (d) 
     and (f), respectively;
       (4) by striking subsection (b) and inserting the following:
       ``(b) Federal Home Loan Banks.--
       ``(1) Establishment and criteria.--For purposes of this 
     subtitle, the Director shall, by regulation--
       ``(A) establish the capital classifications specified under 
     paragraph (2) for the Federal Home Loan Banks;
       ``(B) establish criteria for each such capital 
     classification based on the amount and types of capital held 
     by a bank and the risk-based, minimum, and critical capital 
     levels for the banks and taking due consideration of the 
     capital classifications established under subsection (a) for 
     the enterprises, with such modifications as the Director 
     determines to be appropriate to reflect the difference in 
     operations between the banks and the enterprises; and
       ``(C) shall classify the Federal Home Loan Banks according 
     to such capital classifications.
       ``(2) Classifications.--The capital classifications 
     specified under this paragraph are--
       ``(A) adequately capitalized;
       ``(B) undercapitalized;
       ``(C) significantly undercapitalized; and
       ``(D) critically undercapitalized.
       ``(c) Discretionary Classification.--
       ``(1) Grounds for reclassification.--The Director may 
     reclassify a regulated entity under paragraph (2) if--
       ``(A) at any time, the Director determines in writing that 
     the regulated entity is engaging in conduct that could result 
     in a rapid depletion of core or total capital or the value of 
     collateral pledged as security has decreased significantly or 
     that the value of the property subject to any mortgage held 
     by the regulated entity (or securitized in the case of an 
     enterprise) has decreased significantly;
       ``(B) after notice and an opportunity for hearing, the 
     Director determines that the regulated entity is in an unsafe 
     or unsound condition; or
       ``(C) pursuant to section 1371(b), the Director deems the 
     regulated entity to be engaging in an unsafe or unsound 
     practice.
       ``(2) Reclassification.--In addition to any other action 
     authorized under this title, including the reclassification 
     of a regulated entity for any reason not specified in this 
     subsection, if the Director takes any action described in 
     paragraph (1), the Director may classify a regulated entity--
       ``(A) as undercapitalized, if the regulated entity is 
     otherwise classified as adequately capitalized;
       ``(B) as significantly undercapitalized, if the regulated 
     entity is otherwise classified as undercapitalized; and
       ``(C) as critically undercapitalized, if the regulated 
     entity is otherwise classified as significantly 
     undercapitalized.''; and
       (5) by inserting after subsection (d) (as so redesignated 
     by paragraph (3) of this subsection), the following new 
     subsection:
       ``(e) Restriction on Capital Distributions.--
       ``(1) In general.--A regulated entity shall make no capital 
     distribution if, after making the distribution, the regulated 
     entity would be undercapitalized.
       ``(2) Exception.--Notwithstanding paragraph (1), the 
     Director may permit a regulated entity, to the extent 
     appropriate or applicable, to repurchase, redeem, retire, or 
     otherwise acquire shares or ownership interests if the 
     repurchase, redemption, retirement, or other acquisition--
       ``(A) is made in connection with the issuance of additional 
     shares or obligations of the regulated entity in at least an 
     equivalent amount; and
       ``(B) will reduce the financial obligations of the 
     regulated entity or otherwise improve the financial condition 
     of the entity.''.
       (b) Regulations.--Not later than the expiration of the 180-
     day period beginning on the date of enactment of this Act, 
     the Director of the Federal Housing Finance Agency shall 
     issue regulations to carry out section 1364(b) of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (as added by this section), relating to capital 
     classifications for the Federal Home Loan Banks.

     SEC. 1143. SUPERVISORY ACTIONS APPLICABLE TO UNDERCAPITALIZED 
                   REGULATED ENTITIES.

       Section 1365 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4615) is 
     amended--
       (1) by striking ``the enterprise'' each place that term 
     appears and inserting ``the regulated entity'';
       (2) by striking ``An enterprise'' each place that term 
     appears and inserting ``A regulated entity'';
       (3) by striking ``an enterprise'' each place that term 
     appears and inserting ``a regulated entity'';
       (4) in subsection (a)--
       (A) by redesignating paragraphs (1) and (2) as paragraphs 
     (2) and (3), respectively;
       (B) by inserting before paragraph (2), as redesignated, the 
     following:
       ``(1) Required monitoring.--The Director shall--
       ``(A) closely monitor the condition of any undercapitalized 
     regulated entity;
       ``(B) closely monitor compliance with the capital 
     restoration plan, restrictions, and requirements imposed on 
     an undercapitalized regulated entity under this section; and
       ``(C) periodically review the plan, restrictions, and 
     requirements applicable to an undercapitalized regulated 
     entity to determine whether the plan, restrictions, and 
     requirements are achieving the purpose of this section.''; 
     and
       (C) by adding at the end the following:
       ``(4) Restriction of asset growth.--An undercapitalized 
     regulated entity shall not permit its average total assets 
     during any calendar quarter to exceed its average total 
     assets during the preceding calendar quarter, unless--
       ``(A) the Director has accepted the capital restoration 
     plan of the regulated entity;
       ``(B) any increase in total assets is consistent with the 
     capital restoration plan; and
       ``(C) the ratio of tangible equity to assets of the 
     regulated entity increases during the calendar quarter at a 
     rate sufficient to enable the regulated entity to become 
     adequately capitalized within a reasonable time.
       ``(5) Prior approval of acquisitions and new activities.--
     An undercapitalized regulated entity shall not, directly or 
     indirectly, acquire any interest in any entity or engage in 
     any new activity, unless--
       ``(A) the Director has accepted the capital restoration 
     plan of the regulated entity, the regulated entity is 
     implementing the plan, and the Director determines that the 
     proposed action is consistent with and will further the 
     achievement of the plan; or
       ``(B) the Director determines that the proposed action will 
     further the purpose of this subtitle.'';
       (5) in subsection (b)--
       (A) in the subsection heading, by striking 
     ``Discretionary'';
       (B) in the matter preceding paragraph (1), by striking 
     ``may'' and inserting ``shall''; and
       (C) in paragraph (2)--
       (i) by striking ``make, in good faith, reasonable efforts 
     necessary to''; and
       (ii) by striking the period at the end and inserting ``in 
     any material respect.''; and
       (6) by striking subsection (c) and inserting the following:
       ``(c) Other Discretionary Safeguards.--The Director may 
     take, with respect to an undercapitalized regulated entity, 
     any of the actions authorized to be taken under section 1366 
     with respect to a significantly undercapitalized regulated 
     entity, if the Director determines that such actions are 
     necessary to carry out the purpose of this subtitle.''.

     SEC. 1144. SUPERVISORY ACTIONS APPLICABLE TO SIGNIFICANTLY 
                   UNDERCAPITALIZED REGULATED ENTITIES.

       Section 1366 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4616) is 
     amended--
       (1) in subsection (a)(2), by striking ``undercapitalized 
     enterprise'' and inserting ``undercapitalized'';
       (2) by striking ``the enterprise'' each place that term 
     appears and inserting ``the regulated entity'';
       (3) by striking ``An enterprise'' each place that term 
     appears and inserting ``A regulated entity'';
       (4) by striking ``an enterprise'' each place that term 
     appears and inserting ``a regulated entity'';
       (5) in subsection (b)--
       (A) in the subsection heading, by striking ``Discretionary 
     Supervisory'' and inserting ``Specific'';
       (B) in the matter preceding paragraph (1), by striking 
     ``may, at any time, take any'' and inserting ``shall carry 
     out this section by taking, at any time, 1 or more'';
       (C) by striking paragraph (6);
       (D) by redesignating paragraph (5) as paragraph (6);
       (E) by inserting after paragraph (4) the following:
       ``(5) Improvement of management.--Take 1 or more of the 
     following actions:
       ``(A) New election of board.--Order a new election for the 
     board of directors of the regulated entity.
       ``(B) Dismissal of directors or executive officers.--
     Require the regulated entity to dismiss from office any 
     director or executive officer who had held office for more 
     than 180 days immediately before the date on which the 
     regulated entity became undercapitalized. Dismissal under 
     this subparagraph shall not be construed to be a removal 
     pursuant to the enforcement powers of the Director under 
     section 1377.
       ``(C) Employ qualified executive officers.--Require the 
     regulated entity to employ qualified executive officers (who, 
     if the Director so specifies, shall be subject to approval by 
     the Director).''; and
       (F) by adding at the end the following:
       ``(7) Other action.--Require the regulated entity to take 
     any other action that the Director determines will better 
     carry out the purpose of this section than any of the other 
     actions specified in this subsection.''; and
       (6) by striking subsection (c) and inserting the following:
       ``(c) Restriction on Compensation of Executive Officers.--A 
     regulated entity that is classified as significantly 
     undercapitalized in accordance with section 1364 may not, 
     without prior written approval by the Director--
       ``(1) pay any bonus to any executive officer; or
       ``(2) provide compensation to any executive officer at a 
     rate exceeding the average rate of compensation of that 
     officer (excluding bonuses, stock options, and profit 
     sharing) during the 12 calendar months preceding the

[[Page S6055]]

     calendar month in which the regulated entity became 
     significantly undercapitalized.''.

     SEC. 1145. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED 
                   REGULATED ENTITIES.

       (a) In General.--Section 1367 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4617) is amended to read as follows:

     ``SEC. 1367. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED 
                   REGULATED ENTITIES.

       ``(a) Appointment of the Agency as Conservator or 
     Receiver.--
       ``(1) In general.--Notwithstanding any other provision of 
     Federal or State law, the Director may appoint the Agency as 
     conservator or receiver for a regulated entity in the manner 
     provided under paragraph (2) or (4). All references to the 
     conservator or receiver under this section are references to 
     the Agency acting as conservator or receiver.
       ``(2) Discretionary appointment.--The Agency may, at the 
     discretion of the Director, be appointed conservator or 
     receiver for the purpose of reorganizing, rehabilitating, or 
     winding up the affairs of a regulated entity.
       ``(3) Grounds for discretionary appointment of conservator 
     or receiver.--The grounds for appointing conservator or 
     receiver for any regulated entity under paragraph (2) are as 
     follows:
       ``(A) Substantial dissipation.--Substantial dissipation of 
     assets or earnings due to--
       ``(i) any violation of any provision of Federal or State 
     law; or
       ``(ii) any unsafe or unsound practice.
       ``(B) Unsafe or unsound condition.--An unsafe or unsound 
     condition to transact business.
       ``(C) Cease and desist orders.--Any willful violation of a 
     cease and desist order that has become final.
       ``(D) Concealment.--Any concealment of the books, papers, 
     records, or assets of the regulated entity, or any refusal to 
     submit the books, papers, records, or affairs of the 
     regulated entity, for inspection to any examiner or to any 
     lawful agent of the Director.
       ``(E) Inability to meet obligations.--The regulated entity 
     is likely to be unable to pay its obligations or meet the 
     demands of its creditors in the normal course of business.
       ``(F) Losses.--The regulated entity has incurred or is 
     likely to incur losses that will deplete all or substantially 
     all of its capital, and there is no reasonable prospect for 
     the regulated entity to become adequately capitalized (as 
     defined in section 1364(a)(1)).
       ``(G) Violations of law.--Any violation of any law or 
     regulation, or any unsafe or unsound practice or condition 
     that is likely to--
       ``(i) cause insolvency or substantial dissipation of assets 
     or earnings; or
       ``(ii) weaken the condition of the regulated entity.
       ``(H) Consent.--The regulated entity, by resolution of its 
     board of directors or its shareholders or members, consents 
     to the appointment.
       ``(I) Undercapitalization.--The regulated entity is 
     undercapitalized or significantly undercapitalized (as 
     defined in section 1364(a)(3)), and--
       ``(i) has no reasonable prospect of becoming adequately 
     capitalized;
       ``(ii) fails to become adequately capitalized, as required 
     by--

       ``(I) section 1365(a)(1) with respect to a regulated 
     entity; or
       ``(II) section 1366(a)(1) with respect to a significantly 
     undercapitalized regulated entity;

       ``(iii) fails to submit a capital restoration plan 
     acceptable to the Agency within the time prescribed under 
     section 1369C; or
       ``(iv) materially fails to implement a capital restoration 
     plan submitted and accepted under section 1369C.
       ``(J) Critical undercapitalization.--The regulated entity 
     is critically undercapitalized, as defined in section 
     1364(a)(4).
       ``(K) Money laundering.--The Attorney General notifies the 
     Director in writing that the regulated entity has been found 
     guilty of a criminal offense under section 1956 or 1957 of 
     title 18, United States Code, or section 5322 or 5324 of 
     title 31, United States Code.
       ``(4) Mandatory receivership.--
       ``(A) In general.--The Director shall appoint the Agency as 
     receiver for a regulated entity if the Director determines, 
     in writing, that--
       ``(i) the assets of the regulated entity are, and during 
     the preceding 60 calendar days have been, less than the 
     obligations of the regulated entity to its creditors and 
     others; or
       ``(ii) the regulated entity is not, and during the 
     preceding 60 calendar days has not been, generally paying the 
     debts of the regulated entity (other than debts that are the 
     subject of a bona fide dispute) as such debts become due.
       ``(B) Periodic determination required for critically 
     undercapitalized regulated entity.--If a regulated entity is 
     critically undercapitalized, the Director shall make a 
     determination, in writing, as to whether the regulated entity 
     meets the criteria specified in clause (i) or (ii) of 
     subparagraph (A)--
       ``(i) not later than 30 calendar days after the regulated 
     entity initially becomes critically undercapitalized; and
       ``(ii) at least once during each succeeding 30-calendar day 
     period.
       ``(C) Determination not required if receivership already in 
     place.--Subparagraph (B) does not apply with respect to a 
     regulated entity in any period during which the Agency serves 
     as receiver for the regulated entity.
       ``(D) Receivership terminates conservatorship.--The 
     appointment of the Agency as receiver of a regulated entity 
     under this section shall immediately terminate any 
     conservatorship established for the regulated entity under 
     this title.
       ``(5) Judicial review.--
       ``(A) In general.--If the Agency is appointed conservator 
     or receiver under this section, the regulated entity may, 
     within 30 days of such appointment, bring an action in the 
     United States district court for the judicial district in 
     which the home office of such regulated entity is located, or 
     in the United States District Court for the District of 
     Columbia, for an order requiring the Agency to remove itself 
     as conservator or receiver.
       ``(B) Review.--Upon the filing of an action under 
     subparagraph (A), the court shall, upon the merits, dismiss 
     such action or direct the Agency to remove itself as such 
     conservator or receiver.
       ``(6) Directors not liable for acquiescing in appointment 
     of conservator or receiver.--The members of the board of 
     directors of a regulated entity shall not be liable to the 
     shareholders or creditors of the regulated entity for 
     acquiescing in or consenting in good faith to the appointment 
     of the Agency as conservator or receiver for that regulated 
     entity.
       ``(7) Agency not subject to any other federal agency.--When 
     acting as conservator or receiver, the Agency shall not be 
     subject to the direction or supervision of any other agency 
     of the United States or any State in the exercise of the 
     rights, powers, and privileges of the Agency.
       ``(b) Powers and Duties of the Agency as Conservator or 
     Receiver.--
       ``(1) Rulemaking authority of the agency.--The Agency may 
     prescribe such regulations as the Agency determines to be 
     appropriate regarding the conduct of conservatorships or 
     receiverships.
       ``(2) General powers.--
       ``(A) Successor to regulated entity.--The Agency shall, as 
     conservator or receiver, and by operation of law, immediately 
     succeed to--
       ``(i) all rights, titles, powers, and privileges of the 
     regulated entity, and of any stockholder, officer, or 
     director of such regulated entity with respect to the 
     regulated entity and the assets of the regulated entity; and
       ``(ii) title to the books, records, and assets of any other 
     legal custodian of such regulated entity.
       ``(B) Operate the regulated entity.--The Agency may, as 
     conservator or receiver--
       ``(i) take over the assets of and operate the regulated 
     entity with all the powers of the shareholders, the 
     directors, and the officers of the regulated entity and 
     conduct all business of the regulated entity;
       ``(ii) collect all obligations and money due the regulated 
     entity;
       ``(iii) perform all functions of the regulated entity in 
     the name of the regulated entity which are consistent with 
     the appointment as conservator or receiver;
       ``(iv) preserve and conserve the assets and property of the 
     regulated entity; and
       ``(v) provide by contract for assistance in fulfilling any 
     function, activity, action, or duty of the Agency as 
     conservator or receiver.
       ``(C) Functions of officers, directors, and shareholders of 
     a regulated entity.--The Agency may, by regulation or order, 
     provide for the exercise of any function by any stockholder, 
     director, or officer of any regulated entity for which the 
     Agency has been named conservator or receiver.
       ``(D) Powers as conservator.--The Agency may, as 
     conservator, take such action as may be--
       ``(i) necessary to put the regulated entity in a sound and 
     solvent condition; and
       ``(ii) appropriate to carry on the business of the 
     regulated entity and preserve and conserve the assets and 
     property of the regulated entity.
       ``(E) Additional powers as receiver.--In any case in which 
     the Agency is acting as receiver, the Agency shall place the 
     regulated entity in liquidation and proceed to realize upon 
     the assets of the regulated entity in such manner as the 
     Agency deems appropriate, including through the sale of 
     assets, the transfer of assets to a limited-life regulated 
     entity established under subsection (i), or the exercise of 
     any other rights or privileges granted to the Agency under 
     this paragraph.
       ``(F) Organization of new enterprise.--The Agency shall, as 
     receiver for an enterprise, organize a successor enterprise 
     that will operate pursuant to subsection (i).
       ``(G) Transfer or sale of assets and liabilities.--The 
     Agency may, as conservator or receiver, transfer or sell any 
     asset or liability of the regulated entity in default, and 
     may do so without any approval, assignment, or consent with 
     respect to such transfer or sale.
       ``(H) Payment of valid obligations.--The Agency, as 
     conservator or receiver, shall, to the extent of proceeds 
     realized from the performance of contracts or sale of the 
     assets of a regulated entity, pay all valid obligations of 
     the regulated entity that are due and payable at the time of 
     the appointment of the Agency as conservator or receiver, in 
     accordance with the prescriptions and limitations of this 
     section.
       ``(I) Subpoena authority.--
       ``(i) In general.--

       ``(I) Agency authority.--The Agency may, as conservator or 
     receiver, and for purposes

[[Page S6056]]

     of carrying out any power, authority, or duty with respect to 
     a regulated entity (including determining any claim against 
     the regulated entity and determining and realizing upon any 
     asset of any person in the course of collecting money due the 
     regulated entity), exercise any power established under 
     section 1348.
       ``(II) Applicability of law.--The provisions of section 
     1348 shall apply with respect to the exercise of any power 
     under this subparagraph, in the same manner as such 
     provisions apply under that section.

       ``(ii) Subpoena.--A subpoena or subpoena duces tecum may be 
     issued under clause (i) only by, or with the written approval 
     of, the Director, or the designee of the Director.
       ``(iii) Rule of construction.--This subsection shall not be 
     construed to limit any rights that the Agency, in any 
     capacity, might otherwise have under section 1317 or 1379B.
       ``(J) Incidental powers.--The Agency may, as conservator or 
     receiver--
       ``(i) exercise all powers and authorities specifically 
     granted to conservators or receivers, respectively, under 
     this section, and such incidental powers as shall be 
     necessary to carry out such powers; and
       ``(ii) take any action authorized by this section, which 
     the Agency determines is in the best interests of the 
     regulated entity or the Agency.
       ``(K) Other provisions.--
       ``(i) Shareholders and creditors of failed regulated 
     entity.--Notwithstanding any other provision of law, the 
     appointment of the Agency as receiver for a regulated entity 
     pursuant to paragraph (2) or (4) of subsection (a) and its 
     succession, by operation of law, to the rights, titles, 
     powers, and privileges described in subsection (b)(2)(A) 
     shall terminate all rights and claims that the stockholders 
     and creditors of the regulated entity may have against the 
     assets or charter of the regulated entity or the Agency 
     arising as a result of their status as stockholders or 
     creditors, except for their right to payment, resolution, or 
     other satisfaction of their claims, as permitted under 
     subsections (b)(9), (c), and (e).
       ``(ii) Assets of regulated entity.--Notwithstanding any 
     other provision of law, for purposes of this section, the 
     charter of a regulated entity shall not be considered an 
     asset of the regulated entity.
       ``(3) Authority of receiver to determine claims.--
       ``(A) In general.--The Agency may, as receiver, determine 
     claims in accordance with the requirements of this subsection 
     and any regulations prescribed under paragraph (4).
       ``(B) Notice requirements.--The receiver, in any case 
     involving the liquidation or winding up of the affairs of a 
     closed regulated entity, shall--
       ``(i) promptly publish a notice to the creditors of the 
     regulated entity to present their claims, together with 
     proof, to the receiver by a date specified in the notice 
     which shall be not less than 90 days after the date of 
     publication of such notice; and
       ``(ii) republish such notice approximately 1 month and 2 
     months, respectively, after the date of publication under 
     clause (i).
       ``(C) Mailing required.--The receiver shall mail a notice 
     similar to the notice published under subparagraph (B)(i) at 
     the time of such publication to any creditor shown on the 
     books of the regulated entity--
       ``(i) at the last address of the creditor appearing in such 
     books; or
       ``(ii) upon discovery of the name and address of a claimant 
     not appearing on the books of the regulated entity, within 30 
     days after the discovery of such name and address.
       ``(4) Rulemaking authority relating to determination of 
     claims.--Subject to subsection (c), the Director may 
     prescribe regulations regarding the allowance or disallowance 
     of claims by the receiver and providing for administrative 
     determination of claims and review of such determination.
       ``(5) Procedures for determination of claims.--
       ``(A) Determination period.--
       ``(i) In general.--Before the end of the 180-day period 
     beginning on the date on which any claim against a regulated 
     entity is filed with the Agency as receiver, the Agency shall 
     determine whether to allow or disallow the claim and shall 
     notify the claimant of any determination with respect to such 
     claim.
       ``(ii) Extension of time.--The period described in clause 
     (i) may be extended by a written agreement between the 
     claimant and the Agency.
       ``(iii) Mailing of notice sufficient.--The requirements of 
     clause (i) shall be deemed to be satisfied if the notice of 
     any determination with respect to any claim is mailed to the 
     last address of the claimant which appears--

       ``(I) on the books of the regulated entity;
       ``(II) in the claim filed by the claimant; or
       ``(III) in documents submitted in proof of the claim.

       ``(iv) Contents of notice of disallowance.--If any claim 
     filed under clause (i) is disallowed, the notice to the 
     claimant shall contain--

       ``(I) a statement of each reason for the disallowance; and
       ``(II) the procedures available for obtaining agency review 
     of the determination to disallow the claim or judicial 
     determination of the claim.

       ``(B) Allowance of proven claim.--The receiver shall allow 
     any claim received on or before the date specified in the 
     notice published under paragraph (3)(B)(i) by the receiver 
     from any claimant which is proved to the satisfaction of the 
     receiver.
       ``(C) Disallowance of claims filed after filing period.--
     Claims filed after the date specified in the notice published 
     under paragraph (3)(B)(i), or the date specified under 
     paragraph (3)(C), shall be disallowed and such disallowance 
     shall be final.
       ``(D) Authority to disallow claims.--
       ``(i) In general.--The receiver may disallow any portion of 
     any claim by a creditor or claim of security, preference, or 
     priority which is not proved to the satisfaction of the 
     receiver.
       ``(ii) Payments to less than fully secured creditors.--In 
     the case of a claim of a creditor against a regulated entity 
     which is secured by any property or other asset of such 
     regulated entity, the receiver--

       ``(I) may treat the portion of such claim which exceeds an 
     amount equal to the fair market value of such property or 
     other asset as an unsecured claim against the regulated 
     entity; and
       ``(II) may not make any payment with respect to such 
     unsecured portion of the claim, other than in connection with 
     the disposition of all claims of unsecured creditors of the 
     regulated entity.

       ``(iii) Exceptions.--No provision of this paragraph shall 
     apply with respect to--

       ``(I) any extension of credit from any Federal Reserve 
     Bank, Federal Home Loan Bank, or the United States Treasury; 
     or
       ``(II) any security interest in the assets of the regulated 
     entity securing any such extension of credit.

       ``(E) No judicial review of determination pursuant to 
     subparagraph (d).--No court may review the determination of 
     the Agency under subparagraph (D) to disallow a claim.
       ``(F) Legal effect of filing.--
       ``(i) Statute of limitation tolled.--For purposes of any 
     applicable statute of limitations, the filing of a claim with 
     the receiver shall constitute a commencement of an action.
       ``(ii) No prejudice to other actions.--Subject to paragraph 
     (10), the filing of a claim with the receiver shall not 
     prejudice any right of the claimant to continue any action 
     which was filed before the date of the appointment of the 
     receiver, subject to the determination of claims by the 
     receiver.
       ``(6) Provision for judicial determination of claims.--
       ``(A) In general.--The claimant may file suit on a claim 
     (or continue an action commenced before the appointment of 
     the receiver) in the district or territorial court of the 
     United States for the district within which the principal 
     place of business of the regulated entity is located or the 
     United States District Court for the District of Columbia 
     (and such court shall have jurisdiction to hear such claim), 
     before the end of the 60-day period beginning on the earlier 
     of--
       ``(i) the end of the period described in paragraph 
     (5)(A)(i) with respect to any claim against a regulated 
     entity for which the Agency is receiver; or
       ``(ii) the date of any notice of disallowance of such claim 
     pursuant to paragraph (5)(A)(i).
       ``(B) Statute of limitations.--A claim shall be deemed to 
     be disallowed (other than any portion of such claim which was 
     allowed by the receiver), and such disallowance shall be 
     final, and the claimant shall have no further rights or 
     remedies with respect to such claim, if the claimant fails, 
     before the end of the 60-day period described under 
     subparagraph (A), to file suit on such claim (or continue an 
     action commenced before the appointment of the receiver).
       ``(7) Review of claims.--
       ``(A) Other review procedures.--
       ``(i) In general.--The Agency shall establish such 
     alternative dispute resolution processes as may be 
     appropriate for the resolution of claims filed under 
     paragraph (5)(A)(i).
       ``(ii) Criteria.--In establishing alternative dispute 
     resolution processes, the Agency shall strive for procedures 
     which are expeditious, fair, independent, and low cost.
       ``(iii) Voluntary binding or nonbinding procedures.--The 
     Agency may establish both binding and nonbinding processes 
     under this subparagraph, which may be conducted by any 
     government or private party. All parties, including the 
     claimant and the Agency, must agree to the use of the process 
     in a particular case.
       ``(B) Consideration of incentives.--The Agency shall seek 
     to develop incentives for claimants to participate in the 
     alternative dispute resolution process.
       ``(8) Expedited determination of claims.--
       ``(A) Establishment required.--The Agency shall establish a 
     procedure for expedited relief outside of the routine claims 
     process established under paragraph (5) for claimants who--
       ``(i) allege the existence of legally valid and enforceable 
     or perfected security interests in assets of any regulated 
     entity for which the Agency has been appointed receiver; and
       ``(ii) allege that irreparable injury will occur if the 
     routine claims procedure is followed.
       ``(B) Determination period.--Before the end of the 90-day 
     period beginning on the date on which any claim is filed in 
     accordance with the procedures established under subparagraph 
     (A), the Director shall--
       ``(i) determine--

       ``(I) whether to allow or disallow such claim; or

[[Page S6057]]

       ``(II) whether such claim should be determined pursuant to 
     the procedures established under paragraph (5); and

       ``(ii) notify the claimant of the determination, and if the 
     claim is disallowed, provide a statement of each reason for 
     the disallowance and the procedure for obtaining agency 
     review or judicial determination.
       ``(C) Period for filing or renewing suit.--Any claimant who 
     files a request for expedited relief shall be permitted to 
     file a suit, or to continue a suit filed before the date of 
     appointment of the receiver, seeking a determination of the 
     rights of the claimant with respect to such security interest 
     after the earlier of--
       ``(i) the end of the 90-day period beginning on the date of 
     the filing of a request for expedited relief; or
       ``(ii) the date on which the Agency denies the claim.
       ``(D) Statute of limitations.--If an action described under 
     subparagraph (C) is not filed, or the motion to renew a 
     previously filed suit is not made, before the end of the 30-
     day period beginning on the date on which such action or 
     motion may be filed under subparagraph (B), the claim shall 
     be deemed to be disallowed as of the end of such period 
     (other than any portion of such claim which was allowed by 
     the receiver), such disallowance shall be final, and the 
     claimant shall have no further rights or remedies with 
     respect to such claim.
       ``(E) Legal effect of filing.--
       ``(i) Statute of limitation tolled.--For purposes of any 
     applicable statute of limitations, the filing of a claim with 
     the receiver shall constitute a commencement of an action.
       ``(ii) No prejudice to other actions.--Subject to paragraph 
     (10), the filing of a claim with the receiver shall not 
     prejudice any right of the claimant to continue any action 
     that was filed before the appointment of the receiver, 
     subject to the determination of claims by the receiver.
       ``(9) Payment of claims.--
       ``(A) In general.--The receiver may, in the discretion of 
     the receiver, and to the extent that funds are available from 
     the assets of the regulated entity, pay creditor claims, in 
     such manner and amounts as are authorized under this section, 
     which are--
       ``(i) allowed by the receiver;
       ``(ii) approved by the Agency pursuant to a final 
     determination pursuant to paragraph (7) or (8); or
       ``(iii) determined by the final judgment of any court of 
     competent jurisdiction.
       ``(B) Agreements against the interest of the agency.--No 
     agreement that tends to diminish or defeat the interest of 
     the Agency in any asset acquired by the Agency as receiver 
     under this section shall be valid against the Agency unless 
     such agreement is in writing and executed by an authorized 
     officer or representative of the regulated entity.
       ``(C) Payment of dividends on claims.--The receiver may, in 
     the sole discretion of the receiver, pay from the assets of 
     the regulated entity dividends on proved claims at any time, 
     and no liability shall attach to the Agency by reason of any 
     such payment, for failure to pay dividends to a claimant 
     whose claim is not proved at the time of any such payment.
       ``(D) Rulemaking authority of the director.--The Director 
     may prescribe such rules, including definitions of terms, as 
     the Director deems appropriate to establish a single uniform 
     interest rate for, or to make payments of post-insolvency 
     interest to creditors holding proven claims against the 
     receivership estates of the regulated entity, following 
     satisfaction by the receiver of the principal amount of all 
     creditor claims.
       ``(10) Suspension of legal actions.--
       ``(A) In general.--After the appointment of a conservator 
     or receiver for a regulated entity, the conservator or 
     receiver may, in any judicial action or proceeding to which 
     such regulated entity is or becomes a party, request a stay 
     for a period not to exceed--
       ``(i) 45 days, in the case of any conservator; and
       ``(ii) 90 days, in the case of any receiver.
       ``(B) Grant of stay by all courts required.--Upon receipt 
     of a request by the conservator or receiver under 
     subparagraph (A) for a stay of any judicial action or 
     proceeding in any court with jurisdiction of such action or 
     proceeding, the court shall grant such stay as to all 
     parties.
       ``(11) Additional rights and duties.--
       ``(A) Prior final adjudication.--The Agency shall abide by 
     any final unappealable judgment of any court of competent 
     jurisdiction which was rendered before the appointment of the 
     Agency as conservator or receiver.
       ``(B) Rights and remedies of conservator or receiver.--In 
     the event of any appealable judgment, the Agency as 
     conservator or receiver--
       ``(i) shall have all of the rights and remedies available 
     to the regulated entity (before the appointment of such 
     conservator or receiver) and the Agency, including removal to 
     Federal court and all appellate rights; and
       ``(ii) shall not be required to post any bond in order to 
     pursue such remedies.
       ``(C) No attachment or execution.--No attachment or 
     execution may issue by any court upon assets in the 
     possession of the receiver, or upon the charter, of a 
     regulated entity for which the Agency has been appointed 
     receiver.
       ``(D) Limitation on judicial review.--Except as otherwise 
     provided in this subsection, no court shall have jurisdiction 
     over--
       ``(i) any claim or action for payment from, or any action 
     seeking a determination of rights with respect to, the assets 
     or charter of any regulated entity for which the Agency has 
     been appointed receiver; or
       ``(ii) any claim relating to any act or omission of such 
     regulated entity or the Agency as receiver.
       ``(E) Disposition of assets.--In exercising any right, 
     power, privilege, or authority as conservator or receiver in 
     connection with any sale or disposition of assets of a 
     regulated entity for which the Agency has been appointed 
     conservator or receiver, the Agency shall conduct its 
     operations in a manner which--
       ``(i) maximizes the net present value return from the sale 
     or disposition of such assets;
       ``(ii) minimizes the amount of any loss realized in the 
     resolution of cases; and
       ``(iii) ensures adequate competition and fair and 
     consistent treatment of offerors.
       ``(12) Statute of limitations for actions brought by 
     conservator or receiver.--
       ``(A) In general.--Notwithstanding any provision of any 
     contract, the applicable statute of limitations with regard 
     to any action brought by the Agency as conservator or 
     receiver shall be--
       ``(i) in the case of any contract claim, the longer of--

       ``(I) the 6-year period beginning on the date on which the 
     claim accrues; or
       ``(II) the period applicable under State law; and

       ``(ii) in the case of any tort claim, the longer of--

       ``(I) the 3-year period beginning on the date on which the 
     claim accrues; or
       ``(II) the period applicable under State law.

       ``(B) Determination of the date on which a claim accrues.--
     For purposes of subparagraph (A), the date on which the 
     statute of limitations begins to run on any claim described 
     in such subparagraph shall be the later of--
       ``(i) the date of the appointment of the Agency as 
     conservator or receiver; or
       ``(ii) the date on which the cause of action accrues.
       ``(13) Revival of expired state causes of action.--
       ``(A) In general.--In the case of any tort claim described 
     under clause (ii) for which the statute of limitations 
     applicable under State law with respect to such claim has 
     expired not more than 5 years before the appointment of the 
     Agency as conservator or receiver, the Agency may bring an 
     action as conservator or receiver on such claim without 
     regard to the expiration of the statute of limitations 
     applicable under State law.
       ``(B) Claims described.--A tort claim referred to under 
     clause (i) is a claim arising from fraud, intentional 
     misconduct resulting in unjust enrichment, or intentional 
     misconduct resulting in substantial loss to the regulated 
     entity.
       ``(14) Accounting and recordkeeping requirements.--
       ``(A) In general.--The Agency as conservator or receiver 
     shall, consistent with the accounting and reporting practices 
     and procedures established by the Agency, maintain a full 
     accounting of each conservatorship and receivership or other 
     disposition of a regulated entity in default.
       ``(B) Annual accounting or report.--With respect to each 
     conservatorship or receivership, the Agency shall make an 
     annual accounting or report available to the Board, the 
     Comptroller General of the United States, the Committee on 
     Banking, Housing, and Urban Affairs of the Senate, and the 
     Committee on Financial Services of the House of 
     Representatives.
       ``(C) Availability of reports.--Any report prepared under 
     subparagraph (B) shall be made available by the Agency upon 
     request to any shareholder of a regulated entity or any 
     member of the public.
       ``(D) Recordkeeping requirement.--After the end of the 6-
     year period beginning on the date on which the 
     conservatorship or receivership is terminated by the 
     Director, the Agency may destroy any records of such 
     regulated entity which the Agency, in the discretion of the 
     Agency, determines to be unnecessary, unless directed not to 
     do so by a court of competent jurisdiction or governmental 
     agency, or prohibited by law.
       ``(15) Fraudulent transfers.--
       ``(A) In general.--The Agency, as conservator or receiver, 
     may avoid a transfer of any interest of an entity-affiliated 
     party, or any person determined by the conservator or 
     receiver to be a debtor of the regulated entity, in property, 
     or any obligation incurred by such party or person, that was 
     made within 5 years of the date on which the Agency was 
     appointed conservator or receiver, if such party or person 
     voluntarily or involuntarily made such transfer or incurred 
     such liability with the intent to hinder, delay, or defraud 
     the regulated entity, the Agency, the conservator, or 
     receiver.
       ``(B) Right of recovery.--To the extent a transfer is 
     avoided under subparagraph (A), the conservator or receiver 
     may recover, for the benefit of the regulated entity, the 
     property transferred, or, if a court so orders, the value of 
     such property (at the time of such transfer) from--
       ``(i) the initial transferee of such transfer or the 
     entity-affiliated party or person for whose benefit such 
     transfer was made; or
       ``(ii) any immediate or mediate transferee of any such 
     initial transferee.

[[Page S6058]]

       ``(C) Rights of transferee or obligee.--The conservator or 
     receiver may not recover under subparagraph (B) from--
       ``(i) any transferee that takes for value, including 
     satisfaction or securing of a present or antecedent debt, in 
     good faith; or
       ``(ii) any immediate or mediate good faith transferee of 
     such transferee.
       ``(D) Rights under this paragraph.--The rights under this 
     paragraph of the conservator or receiver described under 
     subparagraph (A) shall be superior to any rights of a trustee 
     or any other party (other than any party which is a Federal 
     agency) under title 11, United States Code.
       ``(16) Attachment of assets and other injunctive relief.--
     Subject to paragraph (17), any court of competent 
     jurisdiction may, at the request of the conservator or 
     receiver, issue an order in accordance with rule 65 of the 
     Federal Rules of Civil Procedure, including an order placing 
     the assets of any person designated by the conservator or 
     receiver under the control of the court, and appointing a 
     trustee to hold such assets.
       ``(17) Standards of proof.--Rule 65 of the Federal Rules of 
     Civil Procedure shall apply with respect to any proceeding 
     under paragraph (16) without regard to the requirement of 
     such rule that the applicant show that the injury, loss, or 
     damage is irreparable and immediate.
       ``(18) Treatment of claims arising from breach of contracts 
     executed by the conservator or receiver.--
       ``(A) In general.--Notwithstanding any other provision of 
     this subsection, any final and unappealable judgment for 
     monetary damages entered against the conservator or receiver 
     for the breach of an agreement executed or approved in 
     writing by the conservator or receiver after the date of its 
     appointment, shall be paid as an administrative expense of 
     the conservator or receiver.
       ``(B) No limitation of power.--Nothing in this paragraph 
     shall be construed to limit the power of the conservator or 
     receiver to exercise any rights under contract or law, 
     including to terminate, breach, cancel, or otherwise 
     discontinue such agreement.
       ``(19) General exceptions.--
       ``(A) Limitations.--The rights of the conservator or 
     receiver appointed under this section shall be subject to the 
     limitations on the powers of a receiver under sections 402 
     through 407 of the Federal Deposit Insurance Corporation 
     Improvement Act of 1991 (12 U.S.C. 4402 through 4407).
       ``(B) Mortgages held in trust.--
       ``(i) In general.--Any mortgage, pool of mortgages, or 
     interest in a pool of mortgages held in trust, custodial, or 
     agency capacity by a regulated entity for the benefit of any 
     person other than the regulated entity shall not be available 
     to satisfy the claims of creditors generally, except that 
     nothing in this clause shall be construed to expand or 
     otherwise affect the authority of any regulated entity.
       ``(ii) Holding of mortgages.--Any mortgage, pool of 
     mortgages, or interest in a pool of mortgages described in 
     clause (i) shall be held by the conservator or receiver 
     appointed under this section for the beneficial owners of 
     such mortgage, pool of mortgages, or interest in accordance 
     with the terms of the agreement creating such trust, 
     custodial, or other agency arrangement.
       ``(iii) Liability of conservator or receiver.--The 
     liability of the conservator or receiver appointed under this 
     section for damages shall, in the case of any contingent or 
     unliquidated claim relating to the mortgages held in trust, 
     be estimated in accordance with the regulations of the 
     Director.
       ``(c) Priority of Expenses and Unsecured Claims.--
       ``(1) In general.--Unsecured claims against a regulated 
     entity, or the receiver therefor, that are proven to the 
     satisfaction of the receiver shall have priority in the 
     following order:
       ``(A) Administrative expenses of the receiver.
       ``(B) Any other general or senior liability of the 
     regulated entity (which is not a liability described under 
     subparagraph (C) or (D).
       ``(C) Any obligation subordinated to general creditors 
     (which is not an obligation described under subparagraph 
     (D)).
       ``(D) Any obligation to shareholders or members arising as 
     a result of their status as shareholder or members.
       ``(2) Creditors similarly situated.--All creditors that are 
     similarly situated under paragraph (1) shall be treated in a 
     similar manner, except that the receiver may take any action 
     (including making payments) that does not comply with this 
     subsection, if--
       ``(A) the Director determines that such action is necessary 
     to maximize the value of the assets of the regulated entity, 
     to maximize the present value return from the sale or other 
     disposition of the assets of the regulated entity, or to 
     minimize the amount of any loss realized upon the sale or 
     other disposition of the assets of the regulated entity; and
       ``(B) all creditors that are similarly situated under 
     paragraph (1) receive not less than the amount provided in 
     subsection (e)(2).
       ``(3) Definition.--As used in this subsection, the term 
     `administrative expenses of the receiver' includes--
       ``(A) the actual, necessary costs and expenses incurred by 
     the receiver in preserving the assets of a failed regulated 
     entity or liquidating or otherwise resolving the affairs of a 
     failed regulated entity; and
       ``(B) any obligations that the receiver determines are 
     necessary and appropriate to facilitate the smooth and 
     orderly liquidation or other resolution of the regulated 
     entity.
       ``(d) Provisions Relating to Contracts Entered Into Before 
     Appointment of Conservator or Receiver.--
       ``(1) Authority to repudiate contracts.--In addition to any 
     other rights a conservator or receiver may have, the 
     conservator or receiver for any regulated entity may 
     disaffirm or repudiate any contract or lease--
       ``(A) to which such regulated entity is a party;
       ``(B) the performance of which the conservator or receiver, 
     in its sole discretion, determines to be burdensome; and
       ``(C) the disaffirmance or repudiation of which the 
     conservator or receiver determines, in its sole discretion, 
     will promote the orderly administration of the affairs of the 
     regulated entity.
       ``(2) Timing of repudiation.--The conservator or receiver 
     shall determine whether or not to exercise the rights of 
     repudiation under this subsection within a reasonable period 
     following such appointment.
       ``(3) Claims for damages for repudiation.--
       ``(A) In general.--Except as otherwise provided under 
     subparagraph (C) and paragraphs (4), (5), and (6), the 
     liability of the conservator or receiver for the 
     disaffirmance or repudiation of any contract pursuant to 
     paragraph (1) shall be--
       ``(i) limited to actual direct compensatory damages; and
       ``(ii) determined as of--

       ``(I) the date of the appointment of the conservator or 
     receiver; or
       ``(II) in the case of any contract or agreement referred to 
     in paragraph (8), the date of the disaffirmance or 
     repudiation of such contract or agreement.

       ``(B) No liability for other damages.--For purposes of 
     subparagraph (A), the term `actual direct compensatory 
     damages' shall not include--
       ``(i) punitive or exemplary damages;
       ``(ii) damages for lost profits or opportunity; or
       ``(iii) damages for pain and suffering.
       ``(C) Measure of damages for repudiation of financial 
     contracts.--In the case of any qualified financial contract 
     or agreement to which paragraph (8) applies, compensatory 
     damages shall be--
       ``(i) deemed to include normal and reasonable costs of 
     cover or other reasonable measures of damages utilized in the 
     industries for such contract and agreement claims; and
       ``(ii) paid in accordance with this subsection and 
     subsection (e), except as otherwise specifically provided in 
     this section.
       ``(4) Leases under which the regulated entity is the 
     lessee.--
       ``(A) In general.--If the conservator or receiver 
     disaffirms or repudiates a lease under which the regulated 
     entity was the lessee, the conservator or receiver shall not 
     be liable for any damages (other than damages determined 
     under subparagraph (B)) for the disaffirmance or repudiation 
     of such lease.
       ``(B) Payments of rent.--Notwithstanding subparagraph (A), 
     the lessor under a lease to which that subparagraph applies 
     shall--
       ``(i) be entitled to the contractual rent accruing before 
     the later of the date on which--

       ``(I) the notice of disaffirmance or repudiation is mailed; 
     or
       ``(II) the disaffirmance or repudiation becomes effective, 
     unless the lessor is in default or breach of the terms of the 
     lease;

       ``(ii) have no claim for damages under any acceleration 
     clause or other penalty provision in the lease; and
       ``(iii) have a claim for any unpaid rent, subject to all 
     appropriate offsets and defenses, due as of the date of the 
     appointment, which shall be paid in accordance with this 
     subsection and subsection (e).
       ``(5) Leases under which the regulated entity is the 
     lessor.--
       ``(A) In general.--If the conservator or receiver 
     repudiates an unexpired written lease of real property of the 
     regulated entity under which the regulated entity is the 
     lessor and the lessee is not, as of the date of such 
     repudiation, in default, the lessee under such lease may 
     either--
       ``(i) treat the lease as terminated by such repudiation; or
       ``(ii) remain in possession of the leasehold interest for 
     the balance of the term of the lease, unless the lessee 
     defaults under the terms of the lease after the date of such 
     repudiation.
       ``(B) Provisions applicable to lessee remaining in 
     possession.--If any lessee under a lease described under 
     subparagraph (A) remains in possession of a leasehold 
     interest under clause (ii) of subparagraph (A)--
       ``(i) the lessee--

       ``(I) shall continue to pay the contractual rent pursuant 
     to the terms of the lease after the date of the repudiation 
     of such lease; and
       ``(II) may offset against any rent payment which accrues 
     after the date of the repudiation of the lease, and any 
     damages which accrue after such date due to the 
     nonperformance of any obligation of the regulated entity 
     under the lease after such date; and

       ``(ii) the conservator or receiver shall not be liable to 
     the lessee for any damages arising after such date as a 
     result of the repudiation, other than the amount of any 
     offset allowed under clause (i)(II).
       ``(6) Contracts for the sale of real property.--

[[Page S6059]]

       ``(A) In general.--If the conservator or receiver 
     repudiates any contract for the sale of real property and the 
     purchaser of such real property under such contract is in 
     possession, and is not, as of the date of such repudiation, 
     in default, such purchaser may either--
       ``(i) treat the contract as terminated by such repudiation; 
     or
       ``(ii) remain in possession of such real property.
       ``(B) Provisions applicable to purchaser remaining in 
     possession.--If any purchaser of real property under any 
     contract described under subparagraph (A) remains in 
     possession of such property under clause (ii) of subparagraph 
     (A)--
       ``(i) the purchaser--

       ``(I) shall continue to make all payments due under the 
     contract after the date of the repudiation of the contract; 
     and
       ``(II) may offset against any such payments any damages 
     which accrue after such date due to the nonperformance (after 
     such date) of any obligation of the regulated entity under 
     the contract; and

       ``(ii) the conservator or receiver shall--

       ``(I) not be liable to the purchaser for any damages 
     arising after such date as a result of the repudiation, other 
     than the amount of any offset allowed under clause (i)(II);
       ``(II) deliver title to the purchaser in accordance with 
     the provisions of the contract; and
       ``(III) have no obligation under the contract other than 
     the performance required under subclause (II).

       ``(C) Assignment and sale allowed.--
       ``(i) In general.--No provision of this paragraph shall be 
     construed as limiting the right of the conservator or 
     receiver to assign the contract described under subparagraph 
     (A), and sell the property subject to the contract and the 
     provisions of this paragraph.
       ``(ii) No liability after assignment and sale.--If an 
     assignment and sale described under clause (i) is 
     consummated, the conservator or receiver shall have no 
     further liability under the contract described under 
     subparagraph (A), or with respect to the real property which 
     was the subject of such contract.
       ``(7) Service contracts.--
       ``(A) Services performed before appointment.--In the case 
     of any contract for services between any person and any 
     regulated entity for which the Agency has been appointed 
     conservator or receiver, any claim of such person for 
     services performed before the appointment of the conservator 
     or receiver shall be--
       ``(i) a claim to be paid in accordance with subsections (b) 
     and (e); and
       ``(ii) deemed to have arisen as of the date on which the 
     conservator or receiver was appointed.
       ``(B) Services performed after appointment and prior to 
     repudiation.--If, in the case of any contract for services 
     described under subparagraph (A), the conservator or receiver 
     accepts performance by the other person before the 
     conservator or receiver makes any determination to exercise 
     the right of repudiation of such contract under this 
     section--
       ``(i) the other party shall be paid under the terms of the 
     contract for the services performed; and
       ``(ii) the amount of such payment shall be treated as an 
     administrative expense of the conservatorship or 
     receivership.
       ``(C) Acceptance of performance no bar to subsequent 
     repudiation.--The acceptance by the conservator or receiver 
     of services referred to under subparagraph (B) in connection 
     with a contract described in such subparagraph shall not 
     affect the right of the conservator or receiver to repudiate 
     such contract under this section at any time after such 
     performance.
       ``(8) Certain qualified financial contracts.--
       ``(A) Rights of parties to contracts.--Subject to 
     paragraphs (9) and (10), and notwithstanding any other 
     provision of this title (other than subsection (b)(9)(B) of 
     this section), any other Federal law, or the law of any 
     State, no person shall be stayed or prohibited from 
     exercising--
       ``(i) any right of that person to cause the termination, 
     liquidation, or acceleration of any qualified financial 
     contract with a regulated entity that arises upon the 
     appointment of the Agency as receiver for such regulated 
     entity at any time after such appointment;
       ``(ii) any right under any security agreement or 
     arrangement or other credit enhancement relating to one or 
     more qualified financial contracts; or
       ``(iii) any right to offset or net out any termination 
     value, payment amount, or other transfer obligation arising 
     under or in connection with 1 or more contracts and 
     agreements described in clause (i), including any master 
     agreement for such contracts or agreements.
       ``(B) Applicability of other provisions.--Subsection 
     (b)(10) shall apply in the case of any judicial action or 
     proceeding brought against any receiver referred to under 
     subparagraph (A), or the regulated entity for which such 
     receiver was appointed, by any party to a contract or 
     agreement described under subparagraph (A)(i) with such 
     regulated entity.
       ``(C) Certain transfers not avoidable.--
       ``(i) In general.--Notwithstanding paragraph (11), or any 
     other provision of Federal or State law relating to the 
     avoidance of preferential or fraudulent transfers, the 
     Agency, whether acting as such or as conservator or receiver 
     of a regulated entity, may not avoid any transfer of money or 
     other property in connection with any qualified financial 
     contract with a regulated entity.
       ``(ii) Exception for certain transfers.--Clause (i) shall 
     not apply to any transfer of money or other property in 
     connection with any qualified financial contract with a 
     regulated entity if the Agency determines that the transferee 
     had actual intent to hinder, delay, or defraud such regulated 
     entity, the creditors of such regulated entity, or any 
     conservator or receiver appointed for such regulated entity.
       ``(D) Certain contracts and agreements defined.--In this 
     subsection the following definitions shall apply:
       ``(i) Qualified financial contract.--The term `qualified 
     financial contract' means any securities contract, commodity 
     contract, forward contract, repurchase agreement, swap 
     agreement, and any similar agreement that the Agency 
     determines by regulation, resolution, or order to be a 
     qualified financial contract for purposes of this paragraph.
       ``(ii) Securities contract.--The term `securities 
     contract'--

       ``(I) means a contract for the purchase, sale, or loan of a 
     security, a certificate of deposit, a mortgage loan, or any 
     interest in a mortgage loan, a group or index of securities, 
     certificates of deposit, or mortgage loans or interests 
     therein (including any interest therein or based on the value 
     thereof) or any option on any of the foregoing, including any 
     option to purchase or sell any such security, certificate of 
     deposit, mortgage loan, interest, group or index, or option, 
     and including any repurchase or reverse repurchase 
     transaction on any such security, certificate of deposit, 
     mortgage loan, interest, group or index, or option;
       ``(II) does not include any purchase, sale, or repurchase 
     obligation under a participation in a commercial mortgage 
     loan, unless the Agency determines by regulation, resolution, 
     or order to include any such agreement within the meaning of 
     such term;
       ``(III) means any option entered into on a national 
     securities exchange relating to foreign currencies;
       ``(IV) means the guarantee by or to any securities clearing 
     agency of any settlement of cash, securities, certificates of 
     deposit, mortgage loans or interests therein, group or index 
     of securities, certificates of deposit, or mortgage loans or 
     interests therein (including any interest therein or based on 
     the value thereof) or option on any of the foregoing, 
     including any option to purchase or sell any such security, 
     certificate of deposit, mortgage loan, interest, group or 
     index, or option;
       ``(V) means any margin loan;
       ``(VI) means any other agreement or transaction that is 
     similar to any agreement or transaction referred to in this 
     clause;
       ``(VII) means any combination of the agreements or 
     transactions referred to in this clause;
       ``(VIII) means any option to enter into any agreement or 
     transaction referred to in this clause;
       ``(IX) means a master agreement that provides for an 
     agreement or transaction referred to in subclause (I), (III), 
     (IV), (V), (VI), (VII), or (VIII), together with all 
     supplements to any such master agreement, without regard to 
     whether the master agreement provides for an agreement or 
     transaction that is not a securities contract under this 
     clause, except that the master agreement shall be considered 
     to be a securities contract under this clause only with 
     respect to each agreement or transaction under the master 
     agreement that is referred to in subclause (I), (III), (IV), 
     (V), (VI), (VII), or (VIII); and
       ``(X) means any security agreement or arrangement or other 
     credit enhancement related to any agreement or transaction 
     referred to in this clause, including any guarantee or 
     reimbursement obligation in connection with any agreement or 
     transaction referred to in this clause.

       ``(iii) Commodity contract.--The term `commodity contract' 
     means--

       ``(I) with respect to a futures commission merchant, a 
     contract for the purchase or sale of a commodity for future 
     delivery on, or subject to the rules of, a contract market or 
     board of trade;
       ``(II) with respect to a foreign futures commission 
     merchant, a foreign future;
       ``(III) with respect to a leverage transaction merchant, a 
     leverage transaction;
       ``(IV) with respect to a clearing organization, a contract 
     for the purchase or sale of a commodity for future delivery 
     on, or subject to the rules of, a contract market or board of 
     trade that is cleared by such clearing organization, or 
     commodity option traded on, or subject to the rules of, a 
     contract market or board of trade that is cleared by such 
     clearing organization;
       ``(V) with respect to a commodity options dealer, a 
     commodity option;
       ``(VI) any other agreement or transaction that is similar 
     to any agreement or transaction referred to in this clause;
       ``(VII) any combination of the agreements or transactions 
     referred to in this clause;
       ``(VIII) any option to enter into any agreement or 
     transaction referred to in this clause;
       ``(IX) a master agreement that provides for an agreement or 
     transaction referred to in subclause (I), (II), (III), (IV), 
     (V), (VI), (VII), or (VIII), together with all supplements to 
     any such master agreement, without regard

[[Page S6060]]

     to whether the master agreement provides for an agreement or 
     transaction that is not a commodity contract under this 
     clause, except that the master agreement shall be considered 
     to be a commodity contract under this clause only with 
     respect to each agreement or transaction under the master 
     agreement that is referred to in subclause (I), (II), (III), 
     (IV), (V), (VI), (VII), or (VIII); or
       ``(X) any security agreement or arrangement or other credit 
     enhancement related to any agreement or transaction referred 
     to in this clause, including any guarantee or reimbursement 
     obligation in connection with any agreement or transaction 
     referred to in this clause.

       ``(iv) Forward contract.--The term `forward contract' 
     means--

       ``(I) a contract (other than a commodity contract) for the 
     purchase, sale, or transfer of a commodity or any similar 
     good, article, service, right, or interest which is presently 
     or in the future becomes the subject of dealing in the 
     forward contract trade, or product or byproduct thereof, with 
     a maturity date more than 2 days after the date on which the 
     contract is entered into, including a repurchase transaction, 
     reverse repurchase transaction, consignment, lease, swap, 
     hedge transaction, deposit, loan, option, allocated 
     transaction, unallocated transaction, or any other similar 
     agreement;
       ``(II) any combination of agreements or transactions 
     referred to in subclauses (I) and (III);
       ``(III) any option to enter into any agreement or 
     transaction referred to in subclause (I) or (II);
       ``(IV) a master agreement that provides for an agreement or 
     transaction referred to in subclauses (I), (II), or (III), 
     together with all supplements to any such master agreement, 
     without regard to whether the master agreement provides for 
     an agreement or transaction that is not a forward contract 
     under this clause, except that the master agreement shall be 
     considered to be a forward contract under this clause only 
     with respect to each agreement or transaction under the 
     master agreement that is referred to in subclause (I), (II), 
     or (III); or
       ``(V) any security agreement or arrangement or other credit 
     enhancement related to any agreement or transaction referred 
     to in subclause (I), (II), (III), or (IV), including any 
     guarantee or reimbursement obligation in connection with any 
     agreement or transaction referred to in any such subclause.

       ``(v) Repurchase agreement.--The term `repurchase 
     agreement' (including a reverse repurchase agreement)--

       ``(I) means an agreement, including related terms, which 
     provides for the transfer of one or more certificates of 
     deposit, mortgage-related securities (as such term is defined 
     in section 3 of the Securities Exchange Act of 1934), 
     mortgage loans, interests in mortgage-related securities or 
     mortgage loans, eligible bankers' acceptances, qualified 
     foreign government securities (defined for purposes of this 
     clause as a security that is a direct obligation of, or that 
     is fully guaranteed by, the central government of a member of 
     the Organization for Economic Cooperation and Development, as 
     determined by regulation or order adopted by the appropriate 
     Federal banking authority), or securities that are direct 
     obligations of, or that are fully guaranteed by, the United 
     States or any agency of the United States against the 
     transfer of funds by the transferee of such certificates of 
     deposit, eligible bankers' acceptances, securities, mortgage 
     loans, or interests with a simultaneous agreement by such 
     transferee to transfer to the transferor thereof certificates 
     of deposit, eligible bankers' acceptances, securities, 
     mortgage loans, or interests as described above, at a date 
     certain not later than 1 year after such transfers or on 
     demand, against the transfer of funds, or any other similar 
     agreement;
       ``(II) does not include any repurchase obligation under a 
     participation in a commercial mortgage loan, unless the 
     Agency determines by regulation, resolution, or order to 
     include any such participation within the meaning of such 
     term;
       ``(III) means any combination of agreements or transactions 
     referred to in subclauses (I) and (IV);
       ``(IV) means any option to enter into any agreement or 
     transaction referred to in subclause (I) or (III);
       ``(V) means a master agreement that provides for an 
     agreement or transaction referred to in subclause (I), (III), 
     or (IV), together with all supplements to any such master 
     agreement, without regard to whether the master agreement 
     provides for an agreement or transaction that is not a 
     repurchase agreement under this clause, except that the 
     master agreement shall be considered to be a repurchase 
     agreement under this subclause only with respect to each 
     agreement or transaction under the master agreement that is 
     referred to in subclause (I), (III), or (IV); and
       ``(VI) means any security agreement or arrangement or other 
     credit enhancement related to any agreement or transaction 
     referred to in subclause (I), (III), (IV), or (V), including 
     any guarantee or reimbursement obligation in connection with 
     any agreement or transaction referred to in any such 
     subclause.

       ``(vi) Swap agreement.--The term `swap agreement' means--

       ``(I) any agreement, including the terms and conditions 
     incorporated by reference in any such agreement, which is an 
     interest rate swap, option, future, or forward agreement, 
     including a rate floor, rate cap, rate collar, cross-currency 
     rate swap, and basis swap; a spot, same day-tomorrow, 
     tomorrow-next, forward, or other foreign exchange or precious 
     metals agreement; a currency swap, option, future, or forward 
     agreement; an equity index or equity swap, option, future, or 
     forward agreement; a debt index or debt swap, option, future, 
     or forward agreement; a total return, credit spread or credit 
     swap, option, future, or forward agreement; a commodity index 
     or commodity swap, option, future, or forward agreement; or a 
     weather swap, weather derivative, or weather option;
       ``(II) any agreement or transaction that is similar to any 
     other agreement or transaction referred to in this clause and 
     that is of a type that has been, is presently, or in the 
     future becomes, the subject of recurrent dealings in the swap 
     markets (including terms and conditions incorporated by 
     reference in such agreement) and that is a forward, swap, 
     future, or option on one or more rates, currencies, 
     commodities, equity securities or other equity instruments, 
     debt securities or other debt instruments, quantitative 
     measures associated with an occurrence, extent of an 
     occurrence, or contingency associated with a financial, 
     commercial, or economic consequence, or economic or financial 
     indices or measures of economic or financial risk or value;
       ``(III) any combination of agreements or transactions 
     referred to in this clause;
       ``(IV) any option to enter into any agreement or 
     transaction referred to in this clause;
       ``(V) a master agreement that provides for an agreement or 
     transaction referred to in subclause (I), (II), (III), or 
     (IV), together with all supplements to any such master 
     agreement, without regard to whether the master agreement 
     contains an agreement or transaction that is not a swap 
     agreement under this clause, except that the master agreement 
     shall be considered to be a swap agreement under this clause 
     only with respect to each agreement or transaction under the 
     master agreement that is referred to in subclause (I), (II), 
     (III), or (IV); and
       ``(VI) any security agreement or arrangement or other 
     credit enhancement related to any agreements or transactions 
     referred to in subclause (I), (II), (III), (IV), or (V), 
     including any guarantee or reimbursement obligation in 
     connection with any agreement or transaction referred to in 
     any such subclause.

       ``(vii) Treatment of master agreement as one agreement.--
     Any master agreement for any contract or agreement described 
     in any preceding clause of this subparagraph (or any master 
     agreement for such master agreement or agreements), together 
     with all supplements to such master agreement, shall be 
     treated as a single agreement and a single qualified 
     financial contract. If a master agreement contains provisions 
     relating to agreements or transactions that are not 
     themselves qualified financial contracts, the master 
     agreement shall be deemed to be a qualified financial 
     contract only with respect to those transactions that are 
     themselves qualified financial contracts.
       ``(viii) Transfer.--The term `transfer' means every mode, 
     direct or indirect, absolute or conditional, voluntary or 
     involuntary, of disposing of or parting with property or with 
     an interest in property, including retention of title as a 
     security interest and foreclosure of the equity of redemption 
     of the regulated entity.
       ``(E) Certain protections in event of appointment of 
     conservator.--Notwithstanding any other provision of this 
     section, any other Federal law, or the law of any State 
     (other than paragraph (10) of this subsection and subsection 
     (b)(9)(B)), no person shall be stayed or prohibited from 
     exercising--
       ``(i) any right such person has to cause the termination, 
     liquidation, or acceleration of any qualified financial 
     contract with a regulated entity in a conservatorship based 
     upon a default under such financial contract which is 
     enforceable under applicable noninsolvency law;
       ``(ii) any right under any security agreement or 
     arrangement or other credit enhancement relating to 1 or more 
     such qualified financial contracts; or
       ``(iii) any right to offset or net out any termination 
     values, payment amounts, or other transfer obligations 
     arising under or in connection with such qualified financial 
     contracts.
       ``(F) Clarification.--No provision of law shall be 
     construed as limiting the right or power of the Agency, or 
     authorizing any court or agency to limit or delay in any 
     manner, the right or power of the Agency to transfer any 
     qualified financial contract in accordance with paragraphs 
     (9) and (10), or to disaffirm or repudiate any such contract 
     in accordance with subsection (d)(1).
       ``(G) Walkaway clauses not effective.--
       ``(i) In general.--Notwithstanding the provisions of 
     subparagraphs (A) and (E), and sections 403 and 404 of the 
     Federal Deposit Insurance Corporation Improvement Act of 
     1991, no walkaway clause shall be enforceable in a qualified 
     financial contract of a regulated entity in default.
       ``(ii) Walkaway clause defined.--For purposes of this 
     subparagraph, the term `walkaway clause' means a provision in 
     a qualified financial contract that, after calculation of a 
     value of a party's position or an amount due to or from 1 of 
     the parties in accordance with its terms upon termination, 
     liquidation, or acceleration of the qualified financial 
     contract, either does not create a

[[Page S6061]]

     payment obligation of a party or extinguishes a payment 
     obligation of a party in whole or in part solely because of 
     the status of such party as a nondefaulting party.
       ``(9) Transfer of qualified financial contracts.--In making 
     any transfer of assets or liabilities of a regulated entity 
     in default which includes any qualified financial contract, 
     the conservator or receiver for such regulated entity shall 
     either--
       ``(A) transfer to 1 person--
       ``(i) all qualified financial contracts between any person 
     (or any affiliate of such person) and the regulated entity in 
     default;
       ``(ii) all claims of such person (or any affiliate of such 
     person) against such regulated entity under any such contract 
     (other than any claim which, under the terms of any such 
     contract, is subordinated to the claims of general unsecured 
     creditors of such regulated entity);
       ``(iii) all claims of such regulated entity against such 
     person (or any affiliate of such person) under any such 
     contract; and
       ``(iv) all property securing, or any other credit 
     enhancement for any contract described in clause (i), or any 
     claim described in clause (ii) or (iii) under any such 
     contract; or
       ``(B) transfer none of the financial contracts, claims, or 
     property referred to under subparagraph (A) (with respect to 
     such person and any affiliate of such person).
       ``(10) Notification of transfer.--
       ``(A) In general.--The conservator or receiver shall notify 
     any person that is a party to a contract or transfer by 5:00 
     p.m. (Eastern Standard Time) on the business day following 
     the date of the appointment of the receiver in the case of a 
     receivership, or the business day following such transfer in 
     the case of a conservatorship, if--
       ``(i) the conservator or receiver for a regulated entity in 
     default makes any transfer of the assets and liabilities of 
     such regulated entity; and
       ``(ii) such transfer includes any qualified financial 
     contract.
       ``(B) Certain rights not enforceable.--
       ``(i) Receivership.--A person who is a party to a qualified 
     financial contract with a regulated entity may not exercise 
     any right that such person has to terminate, liquidate, or 
     net such contract under paragraph (8)(A) of this subsection 
     or under section 403 or 404 of the Federal Deposit Insurance 
     Corporation Improvement Act of 1991, solely by reason of or 
     incidental to the appointment of a receiver for the regulated 
     entity (or the insolvency or financial condition of the 
     regulated entity for which the receiver has been appointed)--

       ``(I) until 5:00 p.m. (Eastern Standard Time) on the 
     business day following the date of the appointment of the 
     receiver; or
       ``(II) after the person has received notice that the 
     contract has been transferred pursuant to paragraph (9)(A).

       ``(ii) Conservatorship.--A person who is a party to a 
     qualified financial contract with a regulated entity may not 
     exercise any right that such person has to terminate, 
     liquidate, or net such contract under paragraph (8)(E) of 
     this subsection or under section 403 or 404 of the Federal 
     Deposit Insurance Corporation Improvement Act of 1991, solely 
     by reason of or incidental to the appointment of a 
     conservator for the regulated entity (or the insolvency or 
     financial condition of the regulated entity for which the 
     conservator has been appointed).
       ``(iii) Notice.--For purposes of this paragraph, the 
     conservator or receiver of a regulated entity shall be deemed 
     to have notified a person who is a party to a qualified 
     financial contract with such regulated entity, if the 
     conservator or receiver has taken steps reasonably calculated 
     to provide notice to such person by the time specified in 
     subparagraph (A).
       ``(C) Business day defined.--For purposes of this 
     paragraph, the term `business day' means any day other than 
     any Saturday, Sunday, or any day on which either the New York 
     Stock Exchange or the Federal Reserve Bank of New York is 
     closed.
       ``(11) Disaffirmance or repudiation of qualified financial 
     contracts.--In exercising the rights of disaffirmance or 
     repudiation of a conservator or receiver with respect to any 
     qualified financial contract to which a regulated entity is a 
     party, the conservator or receiver for such institution shall 
     either--
       ``(A) disaffirm or repudiate all qualified financial 
     contracts between--
       ``(i) any person or any affiliate of such person; and
       ``(ii) the regulated entity in default; or
       ``(B) disaffirm or repudiate none of the qualified 
     financial contracts referred to in subparagraph (A) (with 
     respect to such person or any affiliate of such person).
       ``(12) Certain security interests not avoidable.--No 
     provision of this subsection shall be construed as permitting 
     the avoidance of any legally enforceable or perfected 
     security interest in any of the assets of any regulated 
     entity, except where such an interest is taken in 
     contemplation of the insolvency of the regulated entity, or 
     with the intent to hinder, delay, or defraud the regulated 
     entity or the creditors of such regulated entity.
       ``(13) Authority to enforce contracts.--
       ``(A) In general.--Notwithstanding any provision of a 
     contract providing for termination, default, acceleration, or 
     exercise of rights upon, or solely by reason of, insolvency 
     or the appointment of, or the exercise of rights or powers 
     by, a conservator or receiver, the conservator or receiver 
     may enforce any contract, other than a contract for liability 
     insurance for a director or officer, or a contract or a 
     regulated entity bond, entered into by the regulated entity.
       ``(B) Certain rights not affected.--No provision of this 
     paragraph may be construed as impairing or affecting any 
     right of the conservator or receiver to enforce or recover 
     under a liability insurance contract for an officer or 
     director, or regulated entity bond under other applicable 
     law.
       ``(C) Consent requirement.--
       ``(i) In general.--Except as otherwise provided under this 
     section, no person may exercise any right or power to 
     terminate, accelerate, or declare a default under any 
     contract to which a regulated entity is a party, or to obtain 
     possession of or exercise control over any property of the 
     regulated entity, or affect any contractual rights of the 
     regulated entity, without the consent of the conservator or 
     receiver, as appropriate, for a period of--

       ``(I) 45 days after the date of appointment of a 
     conservator; or
       ``(II) 90 days after the date of appointment of a receiver.

       ``(ii) Exceptions.--This subparagraph shall not--

       ``(I) apply to a contract for liability insurance for an 
     officer or director;
       ``(II) apply to the rights of parties to certain qualified 
     financial contracts under subsection (d)(8); and
       ``(III) be construed as permitting the conservator or 
     receiver to fail to comply with otherwise enforceable 
     provisions of such contracts.

       ``(14) Savings clause.--The meanings of terms used in this 
     subsection are applicable for purposes of this subsection 
     only, and shall not be construed or applied so as to 
     challenge or affect the characterization, definition, or 
     treatment of any similar terms under any other statute, 
     regulation, or rule, including the Gramm-Leach-Bliley Act, 
     the Legal Certainty for Bank Products Act of 2000, the 
     securities laws (as that term is defined in section 3(a)(47) 
     of the Securities Exchange Act of 1934), and the Commodity 
     Exchange Act.
       ``(15) Exception for federal reserve and federal home loan 
     banks.--No provision of this subsection shall apply with 
     respect to--
       ``(A) any extension of credit from any Federal Home Loan 
     Bank or Federal Reserve Bank to any regulated entity; or
       ``(B) any security interest in the assets of the regulated 
     entity securing any such extension of credit.
       ``(e) Valuation of Claims in Default.--
       ``(1) In general.--Notwithstanding any other provision of 
     Federal law or the law of any State, and regardless of the 
     method which the Agency determines to utilize with respect to 
     a regulated entity in default or in danger of default, 
     including transactions authorized under subsection (i), this 
     subsection shall govern the rights of the creditors of such 
     regulated entity.
       ``(2) Maximum liability.--The maximum liability of the 
     Agency, acting as receiver or in any other capacity, to any 
     person having a claim against the receiver or the regulated 
     entity for which such receiver is appointed shall be not more 
     than the amount that such claimant would have received if the 
     Agency had liquidated the assets and liabilities of the 
     regulated entity without exercising the authority of the 
     Agency under subsection (i).
       ``(f) Limitation on Court Action.--Except as provided in 
     this section or at the request of the Director, no court may 
     take any action to restrain or affect the exercise of powers 
     or functions of the Agency as a conservator or a receiver.
       ``(g) Liability of Directors and Officers.--
       ``(1) In general.--A director or officer of a regulated 
     entity may be held personally liable for monetary damages in 
     any civil action described in paragraph (2) brought by, on 
     behalf of, or at the request or direction of the Agency, and 
     prosecuted wholly or partially for the benefit of the 
     Agency--
       ``(A) acting as conservator or receiver of such regulated 
     entity; or
       ``(B) acting based upon a suit, claim, or cause of action 
     purchased from, assigned by, or otherwise conveyed by such 
     receiver or conservator.
       ``(2) Actions addressed.--Paragraph (1) applies in any 
     civil action for gross negligence, including any similar 
     conduct or conduct that demonstrates a greater disregard of a 
     duty of care than gross negligence, including intentional 
     tortious conduct, as such terms are defined and determined 
     under applicable State law.
       ``(3) No limitation.--Nothing in this subsection shall 
     impair or affect any right of the Agency under other 
     applicable law.
       ``(h) Damages.--In any proceeding related to any claim 
     against a director, officer, employee, agent, attorney, 
     accountant, appraiser, or any other party employed by or 
     providing services to a regulated entity, recoverable damages 
     determined to result from the improvident or otherwise 
     improper use or investment of any assets of the regulated 
     entity shall include principal losses and appropriate 
     interest.
       ``(i) Limited-Life Regulated Entities.--
       ``(1) Organization.--
       ``(A) Purpose.--The Agency, as receiver appointed pursuant 
     to subsection (a)--
       ``(i) may, in the case of a Federal Home Loan Bank, 
     organize a limited-life regulated entity with those powers 
     and attributes of the Federal Home Loan Bank in default or in 
     danger of default as the Director determines necessary, 
     subject to the provisions of this

[[Page S6062]]

     subsection, and the Director shall grant a temporary charter 
     to that limited-life regulated entity, and that limited-life 
     regulated entity shall operate subject to that charter; and
       ``(ii) shall, in the case of an enterprise, organize a 
     limited-life regulated entity with respect to that enterprise 
     in accordance with this subsection.
       ``(B) Authorities.--Upon the creation of a limited-life 
     regulated entity under subparagraph (A), the limited-life 
     regulated entity may--
       ``(i) assume such liabilities of the regulated entity that 
     is in default or in danger of default as the Agency may, in 
     its discretion, determine to be appropriate, except that the 
     liabilities assumed shall not exceed the amount of assets 
     purchased or transferred from the regulated entity to the 
     limited-life regulated entity;
       ``(ii) purchase such assets of the regulated entity that is 
     in default, or in danger of default as the Agency may, in its 
     discretion, determine to be appropriate; and
       ``(iii) perform any other temporary function which the 
     Agency may, in its discretion, prescribe in accordance with 
     this section.
       ``(2) Charter and establishment.--
       ``(A) Transfer of charter.--
       ``(i) Fannie mae.--If the Agency is appointed as receiver 
     for the Federal National Mortgage Association, the limited-
     life regulated entity established under this subsection with 
     respect to such enterprise shall, by operation of law and 
     immediately upon its organization--

       ``(I) succeed to the charter of the Federal National 
     Mortgage Association, as set forth in the Federal National 
     Mortgage Association Charter Act; and
       ``(II) thereafter operate in accordance with, and subject 
     to, such charter, this Act, and any other provision of law to 
     which the Federal National Mortgage Association is subject, 
     except as otherwise provided in this subsection.

       ``(ii) Freddie mac.--If the Agency is appointed as receiver 
     for the Federal Home Loan Mortgage Corporation, the limited-
     life regulated entity established under this subsection with 
     respect to such enterprise shall, by operation of law and 
     immediately upon its organization--

       ``(I) succeed to the charter of the Federal Home Loan 
     Mortgage Corporation, as set forth in the Federal Home Loan 
     Mortgage Corporation Charter Act; and
       ``(II) thereafter operate in accordance with, and subject 
     to, such charter, this Act, and any other provision of law to 
     which the Federal Home Loan Mortgage Corporation is subject, 
     except as otherwise provided in this subsection.

       ``(B) Interests in and assets and obligations of regulated 
     entity in default.--Notwithstanding subparagraph (A) or any 
     other provision of law--
       ``(i) a limited-life regulated entity shall assume, 
     acquire, or succeed to the assets or liabilities of a 
     regulated entity only to the extent that such assets or 
     liabilities are transferred by the Agency to the limited-life 
     regulated entity in accordance with, and subject to the 
     restrictions set forth in, paragraph (1)(B);
       ``(ii) a limited-life regulated entity shall not assume, 
     acquire, or succeed to any obligation that a regulated entity 
     for which a receiver has been appointed may have to any 
     shareholder of the regulated entity that arises as a result 
     of the status of that person as a shareholder of the 
     regulated entity; and
       ``(iii) no shareholder or creditor of a regulated entity 
     shall have any right or claim against the charter of the 
     regulated entity once the Agency has been appointed receiver 
     for the regulated entity and a limited-life regulated entity 
     succeeds to the charter pursuant to subparagraph (A).
       ``(C) Limited-life regulated entity treated as being in 
     default for certain purposes.--A limited-life regulated 
     entity shall be treated as a regulated entity in default at 
     such times and for such purposes as the Agency may, in its 
     discretion, determine.
       ``(D) Management.--Upon its establishment, a limited-life 
     regulated entity shall be under the management of a board of 
     directors consisting of not fewer than 5 nor more than 10 
     members appointed by the Agency.
       ``(E) Bylaws.--The board of directors of a limited-life 
     regulated entity shall adopt such bylaws as may be approved 
     by the Agency.
       ``(3) Capital stock.--
       ``(A) No agency requirement.--The Agency is not required to 
     pay capital stock into a limited-life regulated entity or to 
     issue any capital stock on behalf of a limited-life regulated 
     entity established under this subsection.
       ``(B) Authority.--If the Director determines that such 
     action is advisable, the Agency may cause capital stock or 
     other securities of a limited-life regulated entity 
     established with respect to an enterprise to be issued and 
     offered for sale, in such amounts and on such terms and 
     conditions as the Director may determine, in the discretion 
     of the Director.
       ``(4) Investments.--Funds of a limited-life regulated 
     entity shall be kept on hand in cash, invested in obligations 
     of the United States or obligations guaranteed as to 
     principal and interest by the United States, or deposited 
     with the Agency, or any Federal reserve bank.
       ``(5) Exempt tax status.--Notwithstanding any other 
     provision of Federal or State law, a limited-life regulated 
     entity, its franchise, property, and income shall be exempt 
     from all taxation now or hereafter imposed by the United 
     States, by any territory, dependency, or possession thereof, 
     or by any State, county, municipality, or local taxing 
     authority.
       ``(6) Winding up.--
       ``(A) In general.--Subject to subparagraphs (B) and (C), 
     not later than 2 years after the date of its organization, 
     the Agency shall wind up the affairs of a limited-life 
     regulated entity.
       ``(B) Extension.--The Director may, in the discretion of 
     the Director, extend the status of a limited-life regulated 
     entity for 3 additional 1-year periods.
       ``(C) Termination of status as limited-life regulated 
     entity.--
       ``(i) In general.--Upon the sale by the Agency of 80 
     percent or more of the capital stock of a limited-life 
     regulated entity, as defined in clause (iv), to 1 or more 
     persons (other than the Agency)--

       ``(I) the status of the limited-life regulated entity as 
     such shall terminate; and
       ``(II) the entity shall cease to be a limited-life 
     regulated entity for purposes of this subsection.

       ``(ii) Divestiture of remaining stock, if any.--

       ``(I) In general.--Not later than 1 year after the date on 
     which the status of a limited-life regulated entity is 
     terminated pursuant to clause (i), the Agency shall sell to 1 
     or more persons (other than the Agency) any remaining capital 
     stock of the former limited-life regulated entity.
       ``(II) Extension authorized.--The Director may extend the 
     period referred to in subclause (I) for not longer than an 
     additional 2 years, if the Director determines that such 
     action would be in the public interest.

       ``(iii) Savings clause.--Notwithstanding any provision of 
     law, other than clause (ii), the Agency shall not be required 
     to sell the capital stock of an enterprise or a limited-life 
     regulated entity established with respect to an enterprise.
       ``(iv) Applicability.--This subparagraph applies only with 
     respect to a limited-life regulated entity that is 
     established with respect to an enterprise.
       ``(7) Transfer of assets and liabilities.--
       ``(A) In general.--
       ``(i) Transfer of assets and liabilities.--The Agency, as 
     receiver, may transfer any assets and liabilities of a 
     regulated entity in default, or in danger of default, to the 
     limited-life regulated entity in accordance with and subject 
     to the restrictions of paragraph (1).
       ``(ii) Subsequent transfers.--At any time after the 
     establishment of a limited-life regulated entity, the Agency, 
     as receiver, may transfer any assets and liabilities of the 
     regulated entity in default, or in danger of default, as the 
     Agency may, in its discretion, determine to be appropriate in 
     accordance with and subject to the restrictions of paragraph 
     (1).
       ``(iii) Effective without approval.--The transfer of any 
     assets or liabilities of a regulated entity in default or in 
     danger of default to a limited-life regulated entity shall be 
     effective without any further approval under Federal or State 
     law, assignment, or consent with respect thereto.
       ``(iv) Equitable treatment of similarly situated 
     creditors.--The Agency shall treat all creditors of a 
     regulated entity in default or in danger of default that are 
     similarly situated under subsection (c)(1) in a similar 
     manner in exercising the authority of the Agency under this 
     subsection to transfer any assets or liabilities of the 
     regulated entity to the limited-life regulated entity 
     established with respect to such regulated entity, except 
     that the Agency may take actions (including making payments) 
     that do not comply with this clause, if--

       ``(I) the Director determines that such actions are 
     necessary to maximize the value of the assets of the 
     regulated entity, to maximize the present value return from 
     the sale or other disposition of the assets of the regulated 
     entity, or to minimize the amount of any loss realized upon 
     the sale or other disposition of the assets of the regulated 
     entity; and
       ``(II) all creditors that are similarly situated under 
     subsection (c)(1) receive not less than the amount provided 
     in subsection (e)(2).

       ``(v) Limitation on transfer of liabilities.--
     Notwithstanding any other provision of law, the aggregate 
     amount of liabilities of a regulated entity that are 
     transferred to, or assumed by, a limited-life regulated 
     entity may not exceed the aggregate amount of assets of the 
     regulated entity that are transferred to, or purchased by, 
     the limited-life regulated entity.
       ``(8) Regulations.--The Agency may promulgate such 
     regulations as the Agency determines to be necessary or 
     appropriate to implement this subsection.
       ``(9) Powers of limited-life regulated entities.--
       ``(A) In general.--Each limited-life regulated entity 
     created under this subsection shall have all corporate powers 
     of, and be subject to the same provisions of law as, the 
     regulated entity in default or in danger of default to which 
     it relates, except that--
       ``(i) the Agency may--

       ``(I) remove the directors of a limited-life regulated 
     entity;
       ``(II) fix the compensation of members of the board of 
     directors and senior management, as determined by the Agency 
     in its discretion, of a limited-life regulated entity; and

[[Page S6063]]

       ``(III) indemnify the representatives for purposes of 
     paragraph (1)(B), and the directors, officers, employees, and 
     agents of a limited-life regulated entity on such terms as 
     the Agency determines to be appropriate; and

       ``(ii) the board of directors of a limited-life regulated 
     entity--

       ``(I) shall elect a chairperson who may also serve in the 
     position of chief executive officer, except that such person 
     shall not serve either as chairperson or as chief executive 
     officer without the prior approval of the Agency; and
       ``(II) may appoint a chief executive officer who is not 
     also the chairperson, except that such person shall not serve 
     as chief executive officer without the prior approval of the 
     Agency.

       ``(B) Stay of judicial action.--Any judicial action to 
     which a limited-life regulated entity becomes a party by 
     virtue of its acquisition of any assets or assumption of any 
     liabilities of a regulated entity in default shall be stayed 
     from further proceedings for a period of not longer than 45 
     days, at the request of the limited-life regulated entity. 
     Such period may be modified upon the consent of all parties.
       ``(10) No federal status.--
       ``(A) Agency status.--A limited-life regulated entity is 
     not an agency, establishment, or instrumentality of the 
     United States.
       ``(B) Employee status.--Representatives for purposes of 
     paragraph (1)(B), interim directors, directors, officers, 
     employees, or agents of a limited-life regulated entity are 
     not, solely by virtue of service in any such capacity, 
     officers or employees of the United States. Any employee of 
     the Agency or of any Federal instrumentality who serves at 
     the request of the Agency as a representative for purposes of 
     paragraph (1)(B), interim director, director, officer, 
     employee, or agent of a limited-life regulated entity shall 
     not--
       ``(i) solely by virtue of service in any such capacity lose 
     any existing status as an officer or employee of the United 
     States for purposes of title 5, United States Code, or any 
     other provision of law; or
       ``(ii) receive any salary or benefits for service in any 
     such capacity with respect to a limited-life regulated entity 
     in addition to such salary or benefits as are obtained 
     through employment with the Agency or such Federal 
     instrumentality.
       ``(11) Authority to obtain credit.--
       ``(A) In general.--A limited-life regulated entity may 
     obtain unsecured credit and issue unsecured debt.
       ``(B) Inability to obtain credit.--If a limited-life 
     regulated entity is unable to obtain unsecured credit or 
     issue unsecured debt, the Director may authorize the 
     obtaining of credit or the issuance of debt by the limited-
     life regulated entity--
       ``(i) with priority over any or all of the obligations of 
     the limited-life regulated entity;
       ``(ii) secured by a lien on property of the limited-life 
     regulated entity that is not otherwise subject to a lien; or
       ``(iii) secured by a junior lien on property of the 
     limited-life regulated entity that is subject to a lien.
       ``(C) Limitations.--
       ``(i) In general.--The Director, after notice and a 
     hearing, may authorize the obtaining of credit or the 
     issuance of debt by a limited-life regulated entity that is 
     secured by a senior or equal lien on property of the limited-
     life regulated entity that is subject to a lien (other than 
     mortgages that collateralize the mortgage-backed securities 
     issued or guaranteed by an enterprise) only if--

       ``(I) the limited-life regulated entity is unable to 
     otherwise obtain such credit or issue such debt; and
       ``(II) there is adequate protection of the interest of the 
     holder of the lien on the property with respect to which such 
     senior or equal lien is proposed to be granted.

       ``(D) Burden of proof.--In any hearing under this 
     subsection, the Director has the burden of proof on the issue 
     of adequate protection.
       ``(12) Affect on debts and liens.--The reversal or 
     modification on appeal of an authorization under this 
     subsection to obtain credit or issue debt, or of a grant 
     under this section of a priority or a lien, does not affect 
     the validity of any debt so issued, or any priority or lien 
     so granted, to an entity that extended such credit in good 
     faith, whether or not such entity knew of the pendency of the 
     appeal, unless such authorization and the issuance of such 
     debt, or the granting of such priority or lien, were stayed 
     pending appeal.
       ``(j) Other Agency Exemptions.--
       ``(1) Applicability.--The provisions of this subsection 
     shall apply with respect to the Agency in any case in which 
     the Agency is acting as a conservator or a receiver.
       ``(2) Taxation.--The Agency, including its franchise, its 
     capital, reserves, and surplus, and its income, shall be 
     exempt from all taxation imposed by any State, county, 
     municipality, or local taxing authority, except that any real 
     property of the Agency shall be subject to State, 
     territorial, county, municipal, or local taxation to the same 
     extent according to its value as other real property is 
     taxed, except that, notwithstanding the failure of any person 
     to challenge an assessment under State law of the value of 
     such property, and the tax thereon, shall be determined as of 
     the period for which such tax is imposed.
       ``(3) Property protection.--No property of the Agency shall 
     be subject to levy, attachment, garnishment, foreclosure, or 
     sale without the consent of the Agency, nor shall any 
     involuntary lien attach to the property of the Agency.
       ``(4) Penalties and fines.--The Agency shall not be liable 
     for any amounts in the nature of penalties or fines, 
     including those arising from the failure of any person to pay 
     any real property, personal property, probate, or recording 
     tax or any recording or filing fees when due.
       ``(k) Prohibition of Charter Revocation.--In no case may 
     the receiver appointed pursuant to this section revoke, 
     annul, or terminate the charter of an enterprise.''.
       (b) Technical and Conforming Amendments.--The Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4501 et seq.) is amended--
       (1) in section 1368 (12 U.S.C. 4618)--
       (A) by striking ``an enterprise'' each place that term 
     appears and inserting ``a regulated entity''; and
       (B) by striking ``the enterprise'' each place that term 
     appears and inserting ``the regulated entity'';
       (2) in section 1369C (12 U.S.C. 4622), by striking 
     ``enterprise'' each place that term appears and inserting 
     ``regulated entity'';
       (3) in section 1369D (12 U.S.C. 4623)--
       (A) by striking ``an enterprise'' each place that term 
     appears and inserting ``a regulated entity''; and
       (B) in subsection (a)(1), by striking ``An enterprise'' and 
     inserting ``A regulated entity''; and
       (4) by striking sections 1369, 1369A, and 1369B (12 U.S.C. 
     4619, 4620, and 4621).

                    Subtitle D--Enforcement Actions

     SEC. 1151. CEASE AND DESIST PROCEEDINGS.

       Section 1371 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4631) is 
     amended--
       (1) by striking subsections (a) and (b) and inserting the 
     following:
       ``(a) Issuance for Unsafe or Unsound Practices and 
     Violations.--
       ``(1) Authority of director.--If, in the opinion of the 
     Director, a regulated entity or any entity-affiliated party 
     is engaging or has engaged, or the Director has reasonable 
     cause to believe that the regulated entity or any entity-
     affiliated party is about to engage, in an unsafe or unsound 
     practice in conducting the business of the regulated entity 
     or the Office of Finance, or is violating or has violated, or 
     the Director has reasonable cause to believe is about to 
     violate, a law, rule, regulation, or order, or any condition 
     imposed in writing by the Director in connection with the 
     granting of any application or other request by the regulated 
     entity or the Office of Finance or any written agreement 
     entered into with the Director, the Director may issue and 
     serve upon the regulated entity or entity-affiliated party a 
     notice of charges in respect thereof.
       ``(2) Limitation.--The Director may not, pursuant to this 
     section, enforce compliance with any housing goal established 
     under subpart B of part 2 of subtitle A of this title, with 
     section 1336 of this title, with subsection (m) or (n) of 
     section 309 of the Federal National Mortgage Association 
     Charter Act (12 U.S.C. 1723a(m), (n)), with subsection (e) or 
     (f) of section 307 of the Federal Home Loan Mortgage 
     Corporation Act (12 U.S.C. 1456(e), (f)), or with paragraph 
     (5) of section 10(j) of the Federal Home Loan Bank Act (12 
     U.S.C. 1430(j)).
       ``(b) Issuance for Unsatisfactory Rating.--If a regulated 
     entity receives, in its most recent report of examination, a 
     less-than-satisfactory rating for asset quality, management, 
     earnings, or liquidity, the Director may (if the deficiency 
     is not corrected) deem the regulated entity to be engaging in 
     an unsafe or unsound practice for purposes of subsection 
     (a).'';
       (2) in subsection (c)--
       (A) in paragraph (1), by inserting before the period at the 
     end the following: ``, unless the party served with a notice 
     of charges shall appear at the hearing personally or by a 
     duly authorized representative, the party shall be deemed to 
     have consented to the issuance of the cease and desist 
     order''; and
       (B) in paragraph (2)--
       (i) by striking ``or director'' and inserting ``director, 
     or entity-affiliated party''; and
       (ii) by inserting ``or entity-affiliated party'' before 
     ``consents'';
       (3) in each of subsections (c), (d), and (e)--
       (A) by striking ``the enterprise'' each place that term 
     appears and inserting ``the regulated entity'';
       (B) by striking ``an enterprise'' each place that term 
     appears and inserting ``a regulated entity''; and
       (C) by striking ``conduct'' each place that term appears 
     and inserting ``practice'';
       (4) in subsection (d)--
       (A) in the matter preceding paragraph (1)--
       (i) by striking ``or director'' and inserting ``director, 
     or entity-affiliated party''; and
       (ii) by inserting ``to require a regulated entity or 
     entity-affiliated party'' after ``includes the authority'';
       (B) in paragraph (1)--
       (i) by striking ``to require an executive officer or a 
     director to''; and
       (ii) by striking ``loss'' and all that follows through 
     ``person'' and inserting ``loss, if'';
       (iii) in subparagraph (A), by inserting ``such entity or 
     party or finance facility'' before ``was''; and
       (iv) by striking subparagraph (B) and inserting the 
     following:
       ``(B) the violation or practice involved a reckless 
     disregard for the law or any applicable regulations or prior 
     order of the Director;''; and

[[Page S6064]]

       (C) in paragraph (4), by inserting ``loan or'' before 
     ``asset'';
       (5) in subsection (e), by inserting ``or entity-affiliated 
     party''--
       (A) before ``or any executive''; and
       (B) before the period at the end; and
       (6) in subsection (f)--
       (A) by striking ``enterprise'' and inserting ``regulated 
     entity, finance facility,''; and
       (B) by striking ``or director'' and inserting ``director, 
     or entity-affiliated party''.

     SEC. 1152. TEMPORARY CEASE AND DESIST PROCEEDINGS.

       Section 1372 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4632) is 
     amended--
       (1) by striking subsection (a) and inserting the following:
       ``(a) Grounds for Issuance.--
       ``(1) In general.--If the Director determines that the 
     actions specified in the notice of charges served upon a 
     regulated entity or any entity-affiliated party pursuant to 
     section 1371(a), or the continuation thereof, is likely to 
     cause insolvency or significant dissipation of assets or 
     earnings of that entity, or is likely to weaken the condition 
     of that entity prior to the completion of the proceedings 
     conducted pursuant to sections 1371 and 1373, the Director 
     may--
       ``(A) issue a temporary order requiring that regulated 
     entity or entity-affiliated party to cease and desist from 
     any such violation or practice; and
       ``(B) require that regulated entity or entity-affiliated 
     party to take affirmative action to prevent or remedy such 
     insolvency, dissipation, condition, or prejudice pending 
     completion of such proceedings.
       ``(2) Additional requirements.--An order issued under 
     paragraph (1) may include any requirement authorized under 
     subsection 1371(d).'';
       (2) in subsection (b)--
       (A) by striking ``or director'' and inserting ``director, 
     or entity-affiliated party''; and
       (B) by striking ``enterprise'' each place that term appears 
     and inserting ``regulated entity'';
       (3) in subsection (c), by striking ``enterprise'' each 
     place that term appears and inserting ``regulated entity'';
       (4) in subsection (d)--
       (A) by striking ``or director'' each place that term 
     appears and inserting ``director, or entity-affiliated 
     party''; and
       (B) by striking ``An enterprise'' and inserting ``A 
     regulated entity''; and
       (5) in subsection (e)--
       (A) by striking ``request the Attorney General of the 
     United States to''; and
       (B) by striking ``or may, under the direction and control 
     of the Attorney General, bring such action''.

     SEC. 1153. REMOVAL AND PROHIBITION AUTHORITY.

       (a) In General.--Part 1 of subtitle C of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4631 et seq.) is amended--
       (1) by redesignating sections 1377 through 1379B (12 U.S.C. 
     4637-4641) as sections 1379 through 1379D, respectively; and
       (2) by inserting after section 1376 (12 U.S.C. 4636) the 
     following:

     ``SEC. 1377. REMOVAL AND PROHIBITION AUTHORITY.

       ``(a) Authority to Issue Order.--
       ``(1) In general.--The Director may serve upon a party 
     described in paragraph (2), or any officer, director, or 
     management of the Office of Finance a written notice of the 
     intention of the Director to suspend or remove such party 
     from office, or prohibit any further participation by such 
     party, in any manner, in the conduct of the affairs of the 
     regulated entity.
       ``(2) Applicability.--A party described in this paragraph 
     is an entity-affiliated party or any officer, director, or 
     management of the Office of Finance, if the Director 
     determines that--
       ``(A) that party, officer, or director has, directly or 
     indirectly--
       ``(i) violated--

       ``(I) any law or regulation;
       ``(II) any cease and desist order which has become final;
       ``(III) any condition imposed in writing by the Director in 
     connection with the grant of any application or other request 
     by such regulated entity; or
       ``(IV) any written agreement between such regulated entity 
     and the Director;

       ``(ii) engaged or participated in any unsafe or unsound 
     practice in connection with any regulated entity or business 
     institution; or
       ``(iii) committed or engaged in any act, omission, or 
     practice which constitutes a breach of such party's fiduciary 
     duty;
       ``(B) by reason of the violation, practice, or breach 
     described in subparagraph (A)--
       ``(i) such regulated entity or business institution has 
     suffered or will probably suffer financial loss or other 
     damage; or
       ``(ii) such party has received financial gain or other 
     benefit; and
       ``(C) the violation, practice, or breach described in 
     subparagraph (A)--
       ``(i) involves personal dishonesty on the part of such 
     party; or
       ``(ii) demonstrates willful or continuing disregard by such 
     party for the safety or soundness of such regulated entity or 
     business institution.
       ``(b) Suspension Order.--
       ``(1) Suspension or prohibition authority.--If the Director 
     serves written notice under subsection (a) upon a party 
     subject to that subsection (a), the Director may, by order, 
     suspend or remove such party from office, or prohibit such 
     party from further participation in any manner in the conduct 
     of the affairs of the regulated entity, if the Director--
       ``(A) determines that such action is necessary for the 
     protection of the regulated entity; and
       ``(B) serves such party with written notice of the order.
       ``(2) Effective period.--Any order issued under this 
     subsection--
       ``(A) shall become effective upon service; and
       ``(B) unless a court issues a stay of such order under 
     subsection (g), shall remain in effect and enforceable 
     until--
       ``(i) the date on which the Director dismisses the charges 
     contained in the notice served under subsection (a) with 
     respect to such party; or
       ``(ii) the effective date of an order issued under 
     subsection (b).
       ``(3) Copy of order.--If the Director issues an order under 
     subsection (b) to any party, the Director shall serve a copy 
     of such order on any regulated entity with which such party 
     is affiliated at the time such order is issued.
       ``(c) Notice, Hearing, and Order.--
       ``(1) Notice.--A notice under subsection (a) of the 
     intention of the Director to issue an order under this 
     section shall contain a statement of the facts constituting 
     grounds for such action, and shall fix a time and place at 
     which a hearing will be held on such action.
       ``(2) Timing of hearing.--A hearing shall be fixed for a 
     date not earlier than 30 days, nor later than 60 days, after 
     the date of service of notice under subsection (a), unless an 
     earlier or a later date is set by the Director at the request 
     of--
       ``(A) the party receiving such notice, and good cause is 
     shown; or
       ``(B) the Attorney General of the United States.
       ``(3) Consent.--Unless the party that is the subject of a 
     notice delivered under subsection (a) appears at the hearing 
     in person or by a duly authorized representative, such party 
     shall be deemed to have consented to the issuance of an order 
     under this section.
       ``(4) Issuance of order of suspension.--The Director may 
     issue an order under this section, as the Director may deem 
     appropriate, if--
       ``(A) a party is deemed to have consented to the issuance 
     of an order under paragraph (3); or
       ``(B) upon the record made at the hearing, the Director 
     finds that any of the grounds specified in the notice have 
     been established.
       ``(5) Effectiveness of order.--Any order issued under 
     paragraph (4) shall become effective at the expiration of 30 
     days after the date of service upon the relevant regulated 
     entity and party (except in the case of an order issued upon 
     consent under paragraph (3), which shall become effective at 
     the time specified therein). Such order shall remain 
     effective and enforceable except to such extent as it is 
     stayed, modified, terminated, or set aside by action of the 
     Director or a reviewing court.
       ``(d) Prohibition of Certain Specific Activities.--Any 
     person subject to an order issued under this section shall 
     not--
       ``(1) participate in any manner in the conduct of the 
     affairs of any regulated entity or the Office of Finance;
       ``(2) solicit, procure, transfer, attempt to transfer, 
     vote, or attempt to vote any proxy, consent, or authorization 
     with respect to any voting rights in any regulated entity;
       ``(3) violate any voting agreement previously approved by 
     the Director; or
       ``(4) vote for a director, or serve or act as an entity-
     affiliated party of a regulated entity or as an officer or 
     director of the Office of Finance.
       ``(e) Industry-Wide Prohibition.--
       ``(1) In general.--Except as provided in paragraph (2), any 
     person who, pursuant to an order issued under this section, 
     has been removed or suspended from office in a regulated 
     entity or the Office of Finance, or prohibited from 
     participating in the conduct of the affairs of a regulated 
     entity or the Office of Finance, may not, while such order is 
     in effect, continue or commence to hold any office in, or 
     participate in any manner in the conduct of the affairs of, 
     any regulated entity or the Office of Finance.
       ``(2) Exception if director provides written consent.--If, 
     on or after the date on which an order is issued under this 
     section which removes or suspends from office any party, or 
     prohibits such party from participating in the conduct of the 
     affairs of a regulated entity or the Office of Finance, such 
     party receives the written consent of the Director, the order 
     shall, to the extent of such consent, cease to apply to such 
     party with respect to the regulated entity or such Office of 
     Finance described in the written consent. Any such consent 
     shall be publicly disclosed.
       ``(3) Violation of paragraph (1) treated as violation of 
     order.--Any violation of paragraph (1) by any person who is 
     subject to an order issued under subsection (h) shall be 
     treated as a violation of the order.
       ``(f) Applicability.--This section shall only apply to a 
     person who is an individual, unless the Director specifically 
     finds that it should apply to a corporation, firm, or other 
     business entity.
       ``(g) Stay of Suspension and Prohibition of Entity-
     Affiliated Party.--Not later than 10 days after the date on 
     which any entity-affiliated party has been suspended from 
     office or prohibited from participation in the conduct of the 
     affairs of a regulated entity

[[Page S6065]]

     under this section, such party may apply to the United States 
     District Court for the District of Columbia, or the United 
     States district court for the judicial district in which the 
     headquarters of the regulated entity is located, for a stay 
     of such suspension or prohibition pending the completion of 
     the administrative proceedings pursuant to subsection (c). 
     The court shall have jurisdiction to stay such suspension or 
     prohibition.
       ``(h) Suspension or Removal of Entity-Affiliated Party 
     Charged With Felony.--
       ``(1) Suspension or prohibition.--
       ``(A) In general.--Whenever any entity-affiliated party is 
     charged in any information, indictment, or complaint, with 
     the commission of or participation in a crime involving 
     dishonesty or breach of trust which is punishable by 
     imprisonment for a term exceeding 1 year under Federal or 
     State law, the Director may, if continued service or 
     participation by such party may pose a threat to the 
     regulated entity or impair public confidence in the regulated 
     entity, by written notice served upon such party, suspend 
     such party from office or prohibit such party from further 
     participation in any manner in the conduct of the affairs of 
     any regulated entity.
       ``(B) Provisions applicable to notice.--
       ``(i) Copy.--A copy of any notice under subparagraph (A) 
     shall be served upon the relevant regulated entity.
       ``(ii) Effective period.--A suspension or prohibition under 
     subparagraph (A) shall remain in effect until the 
     information, indictment, or complaint referred to in 
     subparagraph (A) is finally disposed of, or until terminated 
     by the Director.
       ``(2) Removal or prohibition.--
       ``(A) In general.--If a judgment of conviction or an 
     agreement to enter a pretrial diversion or other similar 
     program is entered against an entity-affiliated party in 
     connection with a crime described in paragraph (1)(A), at 
     such time as such judgment is not subject to further 
     appellate review, the Director may, if continued service or 
     participation by such party may pose a threat to the 
     regulated entity or impair public confidence in the regulated 
     entity, issue and serve upon such party an order removing 
     such party from office or prohibiting such party from further 
     participation in any manner in the conduct of the affairs of 
     the regulated entity without the prior written consent of the 
     Director.
       ``(B) Provisions applicable to order.--
       ``(i) Copy.--A copy of any order under subparagraph (A) 
     shall be served upon the relevant regulated entity, at which 
     time the entity-affiliated party who is subject to the order 
     (if a director or an officer) shall cease to be a director or 
     officer of such regulated entity.
       ``(ii) Effect of acquittal.--A finding of not guilty or 
     other disposition of the charge shall not preclude the 
     Director from instituting proceedings after such finding or 
     disposition to remove a party from office or to prohibit 
     further participation in the affairs of a regulated entity 
     pursuant to subsection (a) or (b).
       ``(iii) Effective period.--Unless terminated by the 
     Director, any notice of suspension or order of removal issued 
     under this subsection shall remain effective and outstanding 
     until the completion of any hearing or appeal authorized 
     under paragraph (4).
       ``(3) Authority of remaining board members.--
       ``(A) In general.--If at any time, because of the 
     suspension of 1 or more directors pursuant to this section, 
     there shall be on the board of directors of a regulated 
     entity less than a quorum of directors not so suspended, all 
     powers and functions vested in or exercisable by such board 
     shall vest in and be exercisable by the director or directors 
     on the board not so suspended, until such time as there shall 
     be a quorum of the board of directors.
       ``(B) Appointment of temporary directors.--If all of the 
     directors of a regulated entity are suspended pursuant to 
     this section, the Director shall appoint persons to serve 
     temporarily as directors pending the termination of such 
     suspensions, or until such time as those who have been 
     suspended cease to be directors of the regulated entity and 
     their respective successors take office.
       ``(4) Hearing regarding continued participation.--
       ``(A) In general.--Not later than 30 days after the date of 
     service of any notice of suspension or order of removal 
     issued pursuant to paragraph (1) or (2), the entity-
     affiliated party may request in writing an opportunity to 
     appear before the Director to show that the continued service 
     or participation in the conduct of the affairs of the 
     regulated entity by such party does not, or is not likely to, 
     pose a threat to the interests of the regulated entity, or 
     threaten to impair public confidence in the regulated entity.
       ``(B) Timing and form of hearing.--Upon receipt of a 
     request for a hearing under subparagraph (A), the Director 
     shall fix a time (not later than 30 days after the date of 
     receipt of such request, unless extended at the request of 
     such party) and place at which the entity-affiliated party 
     may appear, personally or through counsel, before the 
     Director or 1 or more designated employees of the Director to 
     submit written materials (or, at the discretion of the 
     Director, oral testimony) and oral argument.
       ``(C) Determination.--Not later than 60 days after the date 
     of a hearing under subparagraph (B), the Director shall 
     notify the entity-affiliated party whether the suspension or 
     prohibition from participation in any manner in the conduct 
     of the affairs of the regulated entity will be continued, 
     terminated, or otherwise modified, or whether the order 
     removing such party from office or prohibiting such party 
     from further participation in any manner in the conduct of 
     the affairs of the regulated entity will be rescinded or 
     otherwise modified. Such notification shall contain a 
     statement of the basis for any adverse decision of the 
     Director.
       ``(5) Rules.--The Director is authorized to prescribe such 
     rules as may be necessary to carry out this subsection.''.
       (b) Conforming Amendments.--
       (1) Safety and soundness act.--Subtitle C of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4501 et seq.) is amended--
       (A) in section 1317(f), by striking ``section 1379B'' and 
     inserting ``section 1379D'';
       (B) in section 1373(a)--
       (i) in paragraph (1), by striking ``or 1376(c)'' and 
     inserting ``, 1376(c), or 1377'';
       (ii) in paragraph (2), by inserting ``or 1377'' 
     after''1371''; and
       (iii) in paragraph (4), by inserting ``or removal or 
     prohibition'' after ``cease and desist''; and
       (C) in section 1374(a)--
       (i) by striking ``or 1376'' and inserting ``1313B , 1376, 
     or 1377''; and
       (ii) by striking ``such section'' and inserting ``this 
     title''.
       (2) Fannie mae charter act.--Section 308(b) of the Federal 
     National Mortgage Association Charter Act (12 U.S.C. 1723(b)) 
     is amended in the second sentence, by striking ``The'' and 
     inserting ``Except to the extent that action under section 
     1377 of the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992 temporarily results in a lesser number, 
     the''.
       (3) Freddie mac charter act.--Section 303(a)(2)(A) of the 
     Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
     1452(a)(2)(A)) is amended, in the second sentence, by 
     striking ``The'' and inserting ``Except to the extent action 
     under section 1377 of the Federal Housing Enterprises 
     Financial Safety and Soundness Act of 1992 temporarily 
     results in a lesser number, the''.

     SEC. 1154. ENFORCEMENT AND JURISDICTION.

       Section 1375 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4635) is 
     amended--
       (1) by striking subsection (a) and inserting the following 
     new subsection:
       ``(a) Enforcement.--The Director may, in the discretion of 
     the Director, apply to the United States District Court for 
     the District of Columbia, or the United States district court 
     within the jurisdiction of which the headquarters of the 
     regulated entity is located, for the enforcement of any 
     effective and outstanding notice or order issued under this 
     subtitle or subtitle B, or request that the Attorney General 
     of the United States bring such an action. Such court shall 
     have jurisdiction and power to order and require compliance 
     with such notice or order.''; and
       (2) in subsection (b), by striking ``or 1376'' and 
     inserting ``1313B, 1376, or 1377''.

     SEC. 1155. CIVIL MONEY PENALTIES.

       Section 1376 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4636) is 
     amended--
       (1) by striking subsection (a) and inserting the following:
       ``(a) In General.--The Director may impose a civil money 
     penalty in accordance with this section on any regulated 
     entity or any entity-affiliated party. The Director shall not 
     impose a civil penalty in accordance with this section on any 
     regulated entity or any entity-affiliated party for any 
     violation that is addressed under section 1345(a).'';
       (2) by striking subsection (b) and inserting the following:
       ``(b) Amount of Penalty.--
       ``(1) First tier.--A regulated entity or entity-affiliated 
     party shall forfeit and pay a civil penalty of not more than 
     $10,000 for each day during which a violation continues, if 
     such regulated entity or party--
       ``(A) violates any provision of this title, the authorizing 
     statutes, or any order, condition, rule, or regulation under 
     this title or any authorizing statute;
       ``(B) violates any final or temporary order or notice 
     issued pursuant to this title;
       ``(C) violates any condition imposed in writing by the 
     Director in connection with the grant of any application or 
     other request by such regulated entity; or
       ``(D) violates any written agreement between the regulated 
     entity and the Director.
       ``(2) Second tier.--Notwithstanding paragraph (1), a 
     regulated entity or entity-affiliated party shall forfeit and 
     pay a civil penalty of not more than $50,000 for each day 
     during which a violation, practice, or breach continues, if--
       ``(A) the regulated entity or entity-affiliated party, 
     respectively--
       ``(i) commits any violation described in any subparagraph 
     of paragraph (1);
       ``(ii) recklessly engages in an unsafe or unsound practice 
     in conducting the affairs of the regulated entity; or
       ``(iii) breaches any fiduciary duty; and
       ``(B) the violation, practice, or breach--
       ``(i) is part of a pattern of misconduct;
       ``(ii) causes or is likely to cause more than a minimal 
     loss to the regulated entity; or
       ``(iii) results in pecuniary gain or other benefit to such 
     party.
       ``(3) Third tier.--Notwithstanding paragraphs (1) and (2), 
     any regulated entity or entity-affiliated party shall forfeit 
     and pay a civil penalty in an amount not to exceed the

[[Page S6066]]

     applicable maximum amount determined under paragraph (4) for 
     each day during which such violation, practice, or breach 
     continues, if such regulated entity or entity-affiliated 
     party--
       ``(A) knowingly--
       ``(i) commits any violation described in any subparagraph 
     of paragraph (1);
       ``(ii) engages in any unsafe or unsound practice in 
     conducting the affairs of the regulated entity; or
       ``(iii) breaches any fiduciary duty; and
       ``(B) knowingly or recklessly causes a substantial loss to 
     the regulated entity or a substantial pecuniary gain or other 
     benefit to such party by reason of such violation, practice, 
     or breach.
       ``(4) Maximum amounts of penalties for any violation 
     described in paragraph (3).--The maximum daily amount of any 
     civil penalty which may be assessed pursuant to paragraph (3) 
     for any violation, practice, or breach described in paragraph 
     (3) is--
       ``(A) in the case of any entity-affiliated party, an amount 
     not to exceed $2,000,000; and
       ``(B) in the case of any regulated entity, $2,000,000.'';
       (3) in subsection (c)--
       (A) by striking ``enterprise'' each place that term appears 
     and inserting ``regulated entity'';
       (B) by inserting ``or entity-affiliated party'' before ``in 
     writing''; and
       (C) by inserting ``or entity-affiliated party'' before 
     ``has been given'';
       (4) in subsection (d)--
       (A) by striking ``or director'' each place such term 
     appears and inserting ``director, or entity-affiliated 
     party'';
       (B) by striking ``an enterprise'' and inserting ``a 
     regulated entity'';
       (C) by striking ``the enterprise'' and inserting ``the 
     regulated entity'';
       (D) by striking ``request the Attorney General of the 
     United States to'';
       (E) by inserting ``, or the United States district court 
     within the jurisdiction of which the headquarters of the 
     regulated entity is located,'' after ``District of 
     Columbia'';
       (F) by striking ``, or may, under the direction and control 
     of the Attorney General of the United States, bring such an 
     action''; and
       (G) by striking ``and section 1374''; and
       (5) in subsection (g), by striking ``An enterprise'' and 
     inserting ``A regulated entity''.

     SEC. 1156. CRIMINAL PENALTY.

       (a) In General.--Subtitle C of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4631 et seq.) is amended by inserting after section 
     1377, as added by this Act, the following:

     ``SEC. 1378. CRIMINAL PENALTY.

       ``Whoever, being subject to an order in effect under 
     section 1377, without the prior written approval of the 
     Director, knowingly participates, directly or indirectly, in 
     any manner (including by engaging in an activity specifically 
     prohibited in such an order) in the conduct of the affairs of 
     any regulated entity shall, notwithstanding section 3571 of 
     title 18, be fined not more than $1,000,000, imprisoned for 
     not more than 5 years, or both.''.
       (b) Technical and Conforming Amendments.--The Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992 (12 U.S.C. 4501 et seq.) is amended--
       (1) in section 1379 (as so designated by this Act)--
       (A) by striking ``an enterprise'' and inserting ``a 
     regulated entity''; and
       (B) by striking ``the enterprise'' and inserting ``the 
     regulated entity'';
       (2) in section 1379A (as so designated by this Act), by 
     striking ``an enterprise'' and inserting ``a regulated 
     entity'';
       (3) in section 1379B(c) (as so designated by this Act), by 
     striking ``enterprise'' and inserting ``regulated entity''; 
     and
       (4) in section 1379D (as so designated by this Act), by 
     striking ``enterprise'' and inserting ``regulated entity''.

     SEC. 1157. NOTICE AFTER SEPARATION FROM SERVICE.

       Section 1379 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4637), as so 
     designated by this Act, is amended--
       (1) by striking ``2-year'' and inserting ``6-year'';
       (2) by striking ``a director or executive officer of an 
     enterprise'' and inserting ``an entity-affiliated party'';
       (3) by striking ``director or officer'' each place that 
     term appears and inserting ``entity-affiliated party''; and
       (4) by striking ``enterprise.'' and inserting ``regulated 
     entity.''.

     SEC. 1158. SUBPOENA AUTHORITY.

       (a) In General.--Section 1379B of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4641) is amended--
       (1) in subsection (a)--
       (A) in the matter preceding paragraph (1)--
       (i) by striking ``administrative'';
       (ii) by inserting ``, examination, or investigation'' after 
     ``proceeding'';
       (iii) by striking ``subtitle'' and inserting ``title''; and
       (iv) by inserting ``or any designated representative 
     thereof, including any person designated to conduct any 
     hearing under this subtitle'' after ``Director''; and
       (B) in paragraph (4), by striking ``issued by the 
     Director'';
       (2) in subsection (b), by inserting ``or in any territory 
     or other place subject to the jurisdiction of the United 
     States'' after ``State'';
       (3) by striking subsection (c) and inserting the following:
       ``(c) Enforcement.--
       ``(1) In general.--The Director, or any party to 
     proceedings under this subtitle, may apply to the United 
     States District Court for the District of Columbia, or the 
     United States district court for the judicial district of the 
     United States in any territory in which such proceeding is 
     being conducted, or where the witness resides or carries on 
     business, for enforcement of any subpoena or subpoena duces 
     tecum issued pursuant to this section.
       ``(2) Power of court.--The courts described under paragraph 
     (1) shall have the jurisdiction and power to order and 
     require compliance with any subpoena issued under paragraph 
     (1).'';
       (4) in subsection (d), by inserting ``enterprise-affiliated 
     party'' before ``may allow''; and
       (5) by adding at the end the following:
       ``(e) Penalties.--A person shall be guilty of a 
     misdemeanor, and upon conviction, shall be subject to a fine 
     of not more than $1,000 or to imprisonment for a term of not 
     more than 1 year, or both, if that person willfully fails or 
     refuses, in disobedience of a subpoena issued under 
     subsection (c), to--
       ``(1) attend court;
       ``(2) testify in court;
       ``(3) answer any lawful inquiry; or
       ``(4) produce books, papers, correspondence, contracts, 
     agreements, or such other records as requested in the 
     subpoena.''.

                     Subtitle E--General Provisions

     SEC. 1161. CONFORMING AND TECHNICAL AMENDMENTS.

       (a) Amendments to 1992 Act.--The Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992 (12 
     U.S.C. 4501 et seq.), as amended by this Act, is amended--
       (1) in section 1315 (12 U.S.C. 4515)--
       (A) in subsection (a)--
       (i) by striking ``(a) Office Personnel.--The'' and 
     inserting ``(a) In General.--Subject to title III of the 
     Federal Housing Finance Regulatory Reform Act of 2008, the''; 
     and
       (ii) by striking ``the Office'' each place that term 
     appears and inserting ``the Agency'';
       (B) in subsection (c), by striking ``the Office'' and 
     inserting ``the Agency'';
       (C) in subsection (e), by striking ``the Office'' and 
     inserting ``the Agency'';
       (D) by striking subsection (d) and redesignating subsection 
     (e) as subsection (d); and
       (E) by striking subsection (f);
       (2) in section 1319A (12 U.S.C. 4520)--
       (A) by striking ``(a) In General.--''; and
       (B) by striking subsection (b);
       (3) in section 1364(c) (12 U.S.C. 4614(c)), by striking the 
     last sentence;
       (4) by striking section 1383 (12 U.S.C. 1451 note);
       (5) in each of sections 1319D, 1319E, and 1319F (12 U.S.C. 
     4523, 4524, 4525) by striking ``the Office'' each place that 
     term appears and inserting ``the Agency''; and
       (6) in each of sections 1319B and 1369(a)(3) (12 U.S.C. 
     4521, 4619(a)(3)), by striking ``Committee on Banking, 
     Finance and Urban Affairs'' each place such term appears and 
     inserting ``Committee on Financial Services''.
       (b) Amendments to Fannie Mae Charter Act.--The Federal 
     National Mortgage Association Charter Act (12 U.S.C. 1716 et 
     seq.) is amended--
       (1) in each of sections 303(c)(2) (12 U.S.C. 1718(c)(2)), 
     309(d)(3)(B) (12 U.S.C. 1723a(d)(3)(B)), and 309(k)(1) (12 
     U.S.C. 1723a(k)(1)), by striking ``Director of the Office of 
     Federal Housing Enterprise Oversight of the Department of 
     Housing and Urban Development'' each place that term appears, 
     and inserting ``Director of the Federal Housing Finance 
     Agency''; and
       (2) in section 309--
       (A) in subsection (m) (12 U.S.C. 1723a(m))--
       (i) in paragraph (1), by striking ``to the Secretary, in a 
     form determined by the Secretary'' and inserting ``to the 
     Director of the Federal Housing Finance Agency, in a form 
     determined by the Director''; and
       (ii) in paragraph (2), by striking ``to the Secretary, in a 
     form determined by the Secretary'' and inserting ``to the 
     Director of the Federal Housing Finance Agency, in a form 
     determined by the Director'';
       (B) in subsection (n) (12 U.S.C. 1723a(n))--
       (i) in paragraph (1), by striking ``and the Secretary'' and 
     inserting ``and the Director of the Federal Housing Finance 
     Agency''; and
       (ii) in paragraph (2), by striking ``Secretary'' each place 
     that term appears and inserting ``Director of the Federal 
     Housing Finance Agency''; and
       (C) in paragraph (3)(B), by striking ``Secretary'' and 
     inserting ``Director of the Federal Housing Finance Agency''.
       (c) Amendments to Freddie Mac Charter Act.--The Federal 
     Home Loan Mortgage Corporation Act (12 U.S.C. 1451 et seq.) 
     is amended--
       (1) in each of sections 303(b)(2) (12 U.S.C. 1452(b)(2)), 
     303(h)(2) (12 U.S.C. 1452(h)(2)), and section 307(c)(1) (12 
     U.S.C. 1456(c)(1)), by striking ``Director of the Office of 
     Federal Housing Enterprise Oversight of the Department of 
     Housing and Urban Development'' each place that term appears, 
     and inserting ``Director of the Federal Housing Finance 
     Agency'';
       (2) in section 306 (12 U.S.C. 1455)--
       (A) in subsection (c)(2), by inserting ``the'' after 
     ``Secretary of'';

[[Page S6067]]

       (B) in subsection (i)--
       (i) by striking ``section 1316(c)'' and inserting ``section 
     306(c)''; and
       (ii) by striking ``section 106'' and inserting ``section 
     1316''; and
       (C) in subsection (j)(2), by striking ``of substantially'' 
     and inserting ``or substantially''; and
       (3) in section 307 (12 U.S.C. 1456)--
       (A) in subsection (e)--
       (i) in paragraph (1), by striking ``to the Secretary, in a 
     form determined by the Secretary'' and inserting ``to the 
     Director of the Federal Housing Finance Agency, in a form 
     determined by the Director''; and
       (ii) in paragraph (2), by striking ``to the Secretary, in a 
     form determined by the Secretary'' and inserting ``to the 
     Director of the Federal Housing Finance Agency, in a form 
     determined by the Director''; and
       (B) in subsection (f)--
       (i) in paragraph (1), by striking ``and the Secretary'' and 
     inserting ``and the Director of the Federal Housing Finance 
     Agency'';
       (ii) in paragraph (2), by striking ``the Secretary'' each 
     place that term appears and inserting ``the Director of the 
     Federal Housing Finance Agency''; and
       (iii) in paragraph (3)(B), by striking ``Secretary'' and 
     inserting ``Director of the Federal Housing Finance Agency''.
       (d) Amendment to Title 18, United States Code.--Section 
     1905 of title 18, United States Code, is amended by striking 
     ``Office of Federal Housing Enterprise Oversight'' and 
     inserting ``Federal Housing Finance Agency''.
       (e) Amendments to Flood Disaster Protection Act of 1973.--
     Section 102(f)(3)(A) of the Flood Disaster Protection Act of 
     1973 (42 U.S.C. 4012a(f)(3)(A)) is amended by striking 
     ``Director of the Office of Federal Housing Enterprise 
     Oversight of the Department of Housing and Urban 
     Development'' and inserting ``Director of the Federal Housing 
     Finance Agency''.
       (f) Amendment to Department of Housing and Urban 
     Development Act.--Section 5 of the Department of Housing and 
     Urban Development Act (42 U.S.C. 3534) is amended by striking 
     subsection (d).
       (g) Amendments to Title 5, United States Code.--Title 5, 
     United States Code, is amended--
       (1) in section 5313, by striking the item relating to the 
     Director of the Office of Federal Housing Enterprise 
     Oversight, Department of Housing and Urban Development and 
     inserting the following new item:
       ``Director of the Federal Housing Finance Agency.''; and
       (2) in section 3132(a)(1)--
       (A) in subparagraph (B), by striking ``,, and'' and 
     inserting ``, and'';
       (B) in subparagraph (D)--
       (i) by striking ``the Federal Housing Finance Board'';
       (ii) by striking ``the Office of Federal Housing Enterprise 
     Oversight of the Department of Housing and Urban 
     Development'' and inserting ``the Federal Housing Finance 
     Agency''; and
       (iii) by striking ``or or'' at the end;
       (C) in subparagraph (E), as added by section 
     8(d)(1)(B)(iii) of Public Law 107-123, by adding ``or'' at 
     the end; and
       (D) by redesignating subparagraph (E), as added by section 
     10702(c)(1)(C) of Public Law 107-171, as subparagraph (F).
       (h) Amendment to Sarbanes-Oxley Act.--Section 
     105(b)(5)(B)(ii)(II) of the Sarbanes-Oxley Act of 2002 (15 
     U.S.C. 7215(b)(5)(B)(ii)(II)) is amended by inserting ``and 
     the Director of the Federal Housing Finance Agency,'' after 
     ``Commission,''.
       (i) Amendment to Federal Deposit Insurance Act.--Section 
     11(t)(2)(A) of the Federal Deposit Insurance Act (12 U.S.C. 
     1821(t)(2)(A)) is amended by adding at the end the following:
       ``(vii) Federal Housing Finance Agency.''.

     SEC. 1162. PRESIDENTIALLY-APPOINTED DIRECTORS OF ENTERPRISES.

       (a) Fannie Mae.--
       (1) In general.--Section 308(b) of the Federal National 
     Mortgage Association Charter Act (12 U.S.C. 1723(b)) is 
     amended--
       (A) in the first sentence, by striking ``eighteen persons, 
     five of whom shall be appointed annually by the President of 
     the United States, and the remainder of whom'' and inserting 
     ``13 persons, or such other number that the Director 
     determines appropriate, who'';
       (B) in the second sentence, by striking ``appointed by the 
     President'';
       (C) in the third sentence--
       (i) by striking ``appointed or''; and
       (ii) by striking ``, except that any such appointed member 
     may be removed from office by the President for good cause'';
       (D) in the fourth sentence, by striking ``elective''; and
       (E) by striking the fifth sentence.
       (2) Transitional provision.--The amendments made by 
     paragraph (1) shall not apply to any appointed position of 
     the board of directors of the Federal National Mortgage 
     Association until the expiration of the annual term for such 
     position during which the effective date under section 1163 
     occurs.
       (b) Freddie Mac.--
       (1) In general.--Section 303(a)(2) of the Federal Home Loan 
     Mortgage Corporation Act (12 U.S.C. 1452(a)(2)) is amended--
       (A) in subparagraph (A)--
       (i) in the first sentence, by striking ``18 persons, 5 of 
     whom shall be appointed annually by the President of the 
     United States and the remainder of whom'' and inserting ``13 
     persons, or such other number as the Director determines 
     appropriate, who''; and
       (ii) in the second sentence, by striking ``appointed by the 
     President of the United States'';
       (B) in subparagraph (B)--
       (i) by striking ``such or''; and
       (ii) by striking ``, except that any appointed member may 
     be removed from office by the President for good cause''; and
       (C) in subparagraph (C)--
       (i) by striking the first sentence; and
       (ii) by striking ``elective''.
       (2) Transitional provision.--The amendments made by 
     paragraph (1) shall not apply to any appointed position of 
     the board of directors of the Federal Home Loan Mortgage 
     Corporation until the expiration of the annual term for such 
     position during which the effective date under section 1163 
     occurs.

     SEC. 1163. EFFECTIVE DATE.

       Except as otherwise specifically provided in this title, 
     this title and the amendments made by this title shall take 
     effect on, and shall apply beginning on, the date of 
     enactment of this Act.

                   TITLE II--FEDERAL HOME LOAN BANKS

     SEC. 1201. RECOGNITION OF DISTINCTIONS BETWEEN THE 
                   ENTERPRISES AND THE FEDERAL HOME LOAN BANKS.

       Section 1313 of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992 (12 U.S.C. 4513) is amended 
     by adding at the end the following:
       ``(f) Recognition of Distinctions Between the Enterprises 
     and the Federal Home Loan Banks.--Prior to promulgating any 
     regulation or taking any other formal or informal agency 
     action of general applicability relating to the Federal Home 
     Loan Banks, including the issuance of an advisory document or 
     examination guidance, the Director shall consider the 
     differences between the Federal Home Loan Banks and the 
     enterprises with respect to--
       ``(1) the Banks'--
       ``(A) cooperative ownership structure;
       ``(B) the mission of providing liquidity to members;
       ``(C) affordable housing and community development mission;
       ``(D) capital structure; and
       ``(E) joint and several liability; and
       ``(2) any other differences that the Director considers 
     appropriate.''.

     SEC. 1202. DIRECTORS.

       Section 7 of the Federal Home Loan Bank Act (12 U.S.C. 
     1427) is amended--
       (1) by striking subsection (a) and inserting the following:
       ``(a) Number; Election; Qualifications; Conflicts of 
     Interest.--
       ``(1) In general.--Subject to paragraphs (2) through (4), 
     the management of each Federal Home Loan Bank shall be vested 
     in a board of 13 directors, or such other number as the 
     Director determines appropriate.
       ``(2) Board makeup.--The board of directors of each Bank 
     shall be comprised of--
       ``(A) member directors, who shall comprise at least the 
     majority of the members of the board of directors; and
       ``(B) independent directors, who shall comprise not fewer 
     than \2/5\ of the members of the board of directors.
       ``(3) Selection criteria.--
       ``(A) In general.--Each member of the board of directors 
     shall be--
       ``(i) elected by plurality vote of the members, in 
     accordance with procedures established under this section; 
     and
       ``(ii) a citizen of the United States.
       ``(B) Independent director criteria.--
       ``(i) In general.--Each independent director that is not a 
     public interest director under clause (ii) shall have 
     demonstrated knowledge of, or experience in, financial 
     management, auditing and accounting, risk management 
     practices, derivatives, project development, or 
     organizational management, or such other knowledge or 
     expertise as the Director may provide by regulation.
       ``(ii) Public interest.--Not fewer than 2 of the 
     independent directors shall have more than 4 years of 
     experience in representing consumer or community interests on 
     banking services, credit needs, housing, or financial 
     consumer protections.
       ``(iii) Conflicts of interest.--No independent director 
     may, during the term of service on the board of directors, 
     serve as an officer of any Federal Home Loan Bank or as a 
     director, officer, or employee of any member of a Bank, or of 
     any person that receives advances from a Bank.
       ``(4) Definitions.--For purposes of this section, the 
     following definitions shall apply:
       ``(A) Independent director.--The terms `independent 
     director' and `independent directorship' mean a member of the 
     board of directors of a Federal Home Loan Bank who is a bona 
     fide resident of the district in which the Federal Home Loan 
     Bank is located, or the directorship held by such a person, 
     respectively.
       ``(B) Member director.--The terms `member director' and 
     `member directorship' mean a member of the board of directors 
     of a Federal Home Loan Bank who is an officer or director of 
     a member institution that is located in the district in which 
     the Federal Home Loan Bank is located, or the directorship 
     held by such a person, respectively.'';
       (2) by striking ``elective'' each place that term appears, 
     other than in subsections (d), (e), and (f), and inserting 
     ``member'';
       (3) in subsection (b)--
       (A) by striking the subsection heading and all that follows 
     through ``Each elective directorship'' and inserting the 
     following:
       ``(b) Directorships.--
       ``(1) Member directorships.--Each member directorship''; 
     and
       (B) by adding at the end the following:

[[Page S6068]]

       ``(2) Independent directorships.--
       ``(A) Elections.--Each independent director--
       ``(i) shall be elected by the members entitled to vote, 
     from among eligible persons nominated, after consultation 
     with the Advisory Council of the Bank, by the board of 
     directors of the Bank; and
       ``(ii) shall be elected by a plurality of the votes of the 
     members of the Bank at large, with each member having the 
     number of votes for each such directorship as it has under 
     paragraph (1) in an election to fill member directorships.
       ``(B) Criteria.--Nominees shall meet all applicable 
     requirements prescribed in this section.
       ``(C) Nomination and election procedures.--Procedures for 
     nomination and election of independent directors shall be 
     prescribed by the bylaws of each Federal Home Loan Bank, in a 
     manner consistent with the rules and regulations of the 
     Agency.'';
       (4) in subsection (c)--
       (A) by striking ``elective'' each place that term appears 
     and inserting ``member'', except--
       (i) in the second sentence, the second place that term 
     appears; and
       (ii) each place that term appears in the fifth sentence; 
     and
       (B) in the second sentence--
       (i) by inserting ``(A) except as provided in clause (B) of 
     this sentence,'' before ``if at any time''; and
       (ii) by inserting before the period at the end the 
     following: ``, and (B) clause (A) of this sentence shall not 
     apply to the directorships of any Federal Home Loan Bank 
     resulting from the merger of any 2 or more such Banks'';
       (5) in subsection (d)--
       (A) in the first sentence--
       (i) by striking ``, whether elected or appointed,''; and
       (ii) by striking ``3 years'' and inserting ``4 years'';
       (B) in the second sentence--
       (i) by striking ``Federal Home Loan Bank System 
     Modernization Act of 1999'' and inserting ``Federal Housing 
     Finance Regulatory Reform Act of 2008'';
       (ii) by striking ``\1/3\'' and inserting ``\1/4\''; and
       (iii) by striking ``or appointed''; and
       (C) in the third sentence--
       (i) by striking ``an elective'' each place that term 
     appears and inserting ``a''; and
       (ii) by striking ``in any elective directorship or elective 
     directorships'';
       (6) in subsection (f)--
       (A) by striking paragraph (2);
       (B) by striking ``appointed or'' each place that term 
     appears; and
       (C) in paragraph (3)--
       (i) by striking ``(3) Elected bank directors.--'' and 
     inserting ``(2) Election process.--''; and
       (ii) by striking ``elective'' each place that term appears;
       (7) in subsection (i)--
       (A) in paragraph (1), by striking ``Subject to paragraph 
     (2), each'' and inserting ``Each''; and
       (B) by striking paragraph (2) and inserting the following:
       ``(2) Annual report.--The Director shall include, in the 
     annual report submitted to the Congress pursuant to section 
     1319B of the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992, information regarding the compensation 
     and expenses paid by the Federal Home Loan Banks to the 
     directors on the boards of directors of the Banks.''; and
       (8) by adding at the end the following:
       ``(l) Transition Rule.--Any member of the board of 
     directors of a Bank elected or appointed in accordance with 
     this section prior to the date of enactment of this 
     subsection may continue to serve as a member of that board of 
     directors for the remainder of the existing term of 
     service.''.

     SEC. 1203. DEFINITIONS.

       Section 2 of the Federal Home Loan Bank Act (12 U.S.C. 
     1422) is amended--
       (1) by striking paragraphs (1), (10), and (11);
       (2) by redesignating paragraphs (2) through (9) as 
     paragraphs (1) through (8), respectively;
       (3) by redesignating paragraphs (12) and (13) as paragraphs 
     (9) and (10), respectively; and
       (4) by adding at the end the following:
       ``(11) Director.--The term `Director' means the Director of 
     the Federal Housing Finance Agency.
       ``(12) Agency.--The term `Agency' means the Federal Housing 
     Finance Agency, established under section 1311 of the Federal 
     Housing Enterprises Financial Safety and Soundness Act of 
     1992.''.

     SEC. 1204. AGENCY OVERSIGHT OF FEDERAL HOME LOAN BANKS.

       The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.), 
     other than in provisions of that Act added or amended 
     otherwise by this Act, is amended--
       (1) by striking sections 2A and 2B (12 U.S.C. 1422a, 
     1422b);
       (2) by striking section 18 (12 U.S.C. 1438) and inserting 
     the following:

     ``SEC. 18. ADMINISTRATIVE PROVISIONS.

       ``(a) Acquisition Authority.--The Director of the Office of 
     Thrift Supervision, utilizing the services of the 
     Administrator of General Services (hereinafter referred to as 
     the `Administrator'), and subject to any limitation hereon 
     which may hereafter be imposed in appropriation Acts, is 
     hereby authorized--
       ``(1) to acquire, in the name of the United States, real 
     property in the District of Columbia, for the purposes set 
     forth in this section;
       ``(2) to construct, develop, furnish, and equip such 
     buildings thereon and such facilities as in its judgment may 
     be appropriate to provide, to such extent as the Director of 
     the Office of Thrift Supervision may deem advisable, suitable 
     and adequate quarters and facilities for the Director of the 
     Office of Thrift Supervision and the agencies under its 
     administration or supervision;
       ``(3) to enlarge, remodel, or reconstruct any of the same; 
     and
       ``(4) to make or enter into contracts for any of the 
     foregoing.
       ``(b) Advances.--The Director of the Office of Thrift 
     Supervision may require of the respective banks, and they 
     shall make to the Director of the Office of Thrift 
     Supervision, such advances of funds for the purposes set out 
     in subsection (a) as in the sole judgment of the Director of 
     the Office of Thrift Supervision may from time to time be 
     advisable. Such advances shall be apportioned by the Director 
     of the Office of Thrift Supervision among the banks in 
     proportion to the total assets of the respective banks, 
     determined in such manner and as of such times as the 
     Director of the Office of Thrift Supervision may prescribe. 
     Each such advance shall bear interest at the rate of 4 \1/2\ 
     per centum per annum from the date of the advance and shall 
     be repaid by the Director of the Office of Thrift Supervision 
     in such installments and over such period, not longer than 
     twenty-five years from the making of the advance, as the 
     Director of the Office of Thrift Supervision may determine. 
     Payments of interest and principal upon such advances shall 
     be made from receipts of the Director of the Office of Thrift 
     Supervision or from other sources which may from time to time 
     be available to the Director of the Office of Thrift 
     Supervision. The obligation of the Director of the Office of 
     Thrift Supervision to make any such payment shall not be 
     regarded as an obligation of the United States. To such 
     extent as the Director of the Office of Thrift Supervision 
     may prescribe any such obligation shall be regarded as a 
     legal investment for the purposes of subsections (g) and (h) 
     of section 11 and for the purposes of section 16.
       ``(c) Plans and Designs.--The plans and designs for such 
     buildings and facilities and for any such enlargement, 
     remodeling, or reconstruction shall, to such extent as the 
     chairperson of the Director of the Office of Thrift 
     Supervision may request, be subject to the approval of the 
     Director.
       ``(d) Custody, Management and Control.--Upon the making of 
     arrangements mutually agreeable to the Director of the Office 
     of Thrift Supervision and the Administrator, which 
     arrangements may be modified from time to time by mutual 
     agreement between them and may include but shall not be 
     limited to the making of payments by the Director of the 
     Office of Thrift Supervision and such agencies to the 
     Administrator and by the Administrator to the Director of the 
     Office of Thrift Supervision, the custody, management, and 
     control of such buildings and facilities and of such real 
     property shall be vested in the Administrator in accordance 
     therewith. Until the making of such arrangements, such 
     custody, management, and control, including the assignment 
     and allotment and the reassignment and reallotment of 
     building and other space, shall be vested in the Director of 
     the Office of Thrift Supervision.
       ``(e) Proceeds.--Any proceeds (including advances) received 
     by the Director of the Office of Thrift Supervision in 
     connection with this subsection, and any proceeds from the 
     sale or other disposition of real or other property acquired 
     by the Director of the Office of Thrift Supervision under 
     this section, shall be considered as receipts of the Director 
     of the Office of Thrift Supervision, and obligations and 
     expenditures of the Director of the Office of Thrift 
     Supervision and such agencies in connection with this section 
     shall not be considered as administrative expenses. As used 
     in this section, the term `property' shall include interests 
     in property.
       ``(f) Budget Program.--
       ``(1) In general.--With respect to its functions under this 
     section, the Director of the Office of Thrift Supervision 
     shall--
       ``(A) annually prepare and submit a budget program as 
     provided in title I of the Government Corporation Control Act 
     with regard to wholly owned Government corporations, and for 
     purposes of this paragraph, the terms `wholly owned 
     Government corporations' and `Government corporations', 
     wherever used in such title, shall include the Director of 
     the Office of Thrift Supervision; and
       ``(B) maintain an integral set of accounts which shall be 
     audited by the General Accounting Office in accordance with 
     the principles and procedures applicable to commercial 
     corporate transactions, as provided in such title, and no 
     other settlement or adjustment shall be required with respect 
     to transactions under this section or with respect to claims, 
     demands, or accounts by or against any person arising 
     thereunder.
       ``(2) Miscellaneous provisions.--The first budget program 
     shall be for the first full fiscal year beginning on or after 
     the date of enactment of this subsection. Except as otherwise 
     provided in this section or by the Director of the Office of 
     Thrift Supervision, the provisions of this section and the 
     functions thereby or thereunder subsisting shall be 
     applicable and exercisable notwithstanding and without regard 
     to the Act of June 20, 1938 (D.C. Code, secs. 5-413--5-428), 
     except that the proviso of section 16 thereof shall apply

[[Page S6069]]

     to any building constructed under this section, and section 
     306 of the Act of July 30, 1947 (61 Stat. 584), or any other 
     provision of law relating to the construction, alteration, 
     repair, or furnishing of public or other buildings or 
     structures or the obtaining of sites therefor, but any person 
     or body in whom any such function is vested may provide for 
     delegation or redelegation of the exercise of such function.
       ``(g) Limitation.--No obligation shall be incurred and no 
     expenditure, except in liquidation of obligation, shall be 
     made pursuant to paragraphs (1) and (2) of subsection (a), if 
     the total amount of all obligations incurred pursuant thereto 
     would thereupon exceed $13,200,000, or such greater amount as 
     may be provided in an appropriations Act or other law.''.
       (3) in section 11 (12 U.S.C. 1431)--
       (A) in subsection (b)--
       (i) in the first sentence--

       (I) by striking ``The Board'' and inserting ``The Office of 
     Finance, as agent for the Banks,''; and
       (II) by striking ``the Board'' and inserting ``such 
     Office''; and

       (ii) in the second and fourth sentences, by striking ``the 
     Board'' each place such term appears and inserting ``the 
     Office of Finance'';
       (B) in subsection (c)--
       (i) by striking ``the Board'' the first place such term 
     appears and inserting ``the Office of Finance, as agent for 
     the Banks,''; and
       (ii) by striking ``the Board'' the second place such term 
     appears and inserting ``such Office''; and
       (C) in subsection (f)--
       (i) by striking the 2 commas after ``permit'' and inserting 
     ``or''; and
       (ii) by striking the comma after ``require'';
       (4) in section 6 (12 U.S.C. 1426)--
       (A) in subsection (b)(1), in the matter preceding 
     subparagraph (A), by striking ``Finance Board approval'' and 
     inserting ``approval by the Director''; and
       (B) in each of subsections (c)(4)(B) and (d)(2), by 
     striking ``Finance Board regulations'' each place that term 
     appears and inserting ``regulations of the Director'';
       (5) in section 10(b) (12 U.S.C. 1430(b))--
       (A) in the subsection heading, by striking ``Formal Board 
     Resolution'' and inserting ``Approval of Director''; and
       (B) by striking ``by formal resolution'';
       (6) in section 21(b)(5) (12 U.S.C. 1441(b)(5)), by striking 
     ``Chairperson of the Federal Housing Finance Board'' and 
     inserting ``Director'';
       (7) in section 15 (12 U.S.C. 1435), by inserting ``or the 
     Director'' after ``the Board'';
       (8) by striking ``the Board'' each place that term appears 
     and inserting ``the Director'';
       (9) by striking ``The Board'' each place that term appears 
     and inserting ``The Director'';
       (10) by striking ``the Finance Board'' each place that term 
     appears and inserting ``the Director'';
       (11) by striking ``The Finance Board'' each place that term 
     appears and inserting ``The Director''; and
       (12) by striking ``Federal Housing Finance Board'' each 
     place that term appears and inserting ``Director''.

     SEC. 1205. HOUSING GOALS.

       The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.) is 
     amended by inserting after section 10b the following new 
     section:

     ``SEC. 10C. HOUSING GOALS.

       ``(a) In General.--The Director shall establish housing 
     goals with respect to the purchase of mortgages, if any, by 
     the Federal Home Loan Banks. Such goals shall be consistent 
     with the goals established under sections 1331 through 1334 
     of the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992.
       ``(b) Considerations.--In establishing the goals required 
     by subsection (a), the Director shall consider the unique 
     mission and ownership structure of the Federal Home Loan 
     Banks.
       ``(c) Transition Period.--To facilitate an orderly 
     transition, the Director shall establish interim target goals 
     for purposes of this section for each of the 2 calendar years 
     following the date of enactment of this section.
       ``(d) Monitoring and Enforcement of Goals.--The 
     requirements of section 1336 of the Federal Housing 
     Enterprises Safety and Soundness Act of 1992, shall apply to 
     this section, in the same manner and to the same extent as 
     that section applies to the Federal housing enterprises.
       ``(e) Annual Report.--The Director shall annually report to 
     Congress on the performance of the Banks in meeting the goals 
     established under this section.''.

     SEC. 1206. COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS.

       Section 4(a)(1) of the Federal Home Loan Bank Act (12 
     U.S.C. 1424(a)(1)) is amended--
       (1) by inserting after ``savings bank,'' the following: 
     ``community development financial institution,''; and
       (2) in subparagraph (B), by inserting after ``United 
     States,'' the following: ``or, in the case of a community 
     development financial institution, is certified as a 
     community development financial institution under the 
     Community Development Banking and Financial Institutions Act 
     of 1994.''.

     SEC. 1207. SHARING OF INFORMATION AMONG FEDERAL HOME LOAN 
                   BANKS.

       The Federal Home Loan Bank Act is amended by inserting 
     after section 20 (12 U.S.C. 1440) the following new section:

     ``SEC. 20A. SHARING OF INFORMATION AMONG FEDERAL HOME LOAN 
                   BANKS.

       ``(a) Information on Financial Condition.--In order to 
     enable each Federal Home Loan Bank to evaluate the financial 
     condition of one or more of the other Federal Home Loan Banks 
     individually and the Federal Home Loan Bank System (including 
     any risks associated with the issuance or repayment of 
     consolidated Federal Home Loan Bank bonds and debentures or 
     other borrowings and the joint and several liabilities of the 
     Banks incurred due to such borrowings), as well as to comply 
     with any of its obligations under the Securities Exchange Act 
     of 1934 (15 U.S.C. 78a et seq.), the Director shall make 
     available to the Banks such reports, records, or other 
     information as may be available, relating to the condition of 
     any Federal Home Loan Bank.
       ``(b) Sharing of Information.--
       ``(1) In general.--The Director shall promulgate 
     regulations to facilitate the sharing of information made 
     available under subsection (a) directly among the Federal 
     Home Loan Banks.
       ``(2) Limitation.--Notwithstanding paragraph (1), a Federal 
     Home Loan Bank responding to a request from another Bank or 
     from the Director for information pursuant to this section 
     may request that the Director determine that such information 
     is proprietary and that the public interest requires that 
     such information not be shared.
       ``(c) Limitation.--Nothing in this section shall affect the 
     obligations of any Federal Home Loan Bank under the 
     Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) or 
     the regulations issued by the Securities and Exchange 
     Commission thereunder.''.

     SEC. 1208. EXCLUSION FROM CERTAIN REQUIREMENTS.

       (a) In General.--The Federal Home Loan Banks shall be 
     exempt from compliance with--
       (1) sections 13(e), 14(a), and 14(c) of the Securities 
     Exchange Act of 1934, and related Commission regulations;
       (2) section 15 of the Securities Exchange Act of 1934, and 
     related Commission regulations, with respect to transactions 
     in the capital stock of a Federal Home Loan Bank;
       (3) section 17A of the Securities Exchange Act of 1934, and 
     related Commission regulations, with respect to the transfer 
     of the securities of a Federal Home Loan Bank; and
       (4) the Trust Indenture Act of 1939.
       (b) Member Exemption.--The members of the Federal Home Loan 
     Bank System shall be exempt from compliance with sections 
     13(d), 13(f), 13(g), 14(d), and 16 of the Securities Exchange 
     Act of 1934, and related Commission regulations, with respect 
     to ownership of or transactions in the capital stock of the 
     Federal Home Loan Banks by such members.
       (c) Exempted and Government Securities.--
       (1) Capital stock.--The capital stock issued by each of the 
     Federal Home Loan Banks under section 6 of the Federal Home 
     Loan Bank Act are--
       (A) exempted securities, within the meaning of section 
     3(a)(2) of the Securities Act of 1933; and
       (B) exempted securities, within the meaning of section 
     3(a)(12)(A) of the Securities Exchange Act of 1934, except to 
     the extent provided in section 38 of that Act.
       (2) Other obligations.--The debentures, bonds, and other 
     obligations issued under section 11 of the Federal Home Loan 
     Bank Act (12 U.S.C. 1431) are--
       (A) exempted securities, within the meaning of section 
     3(a)(2) of the Securities Act of 1933;
       (B) government securities, within the meaning of section 
     3(a)(42) of the Securities Exchange Act of 1934; and
       (C) government securities, within the meaning of section 
     2(a)(16) of the Investment Company Act of 1940.
       (3) Brokers and dealers.--A person (other than a Federal 
     Home Loan Bank effecting transactions for members of the 
     Federal Home Loan Bank System) that effects transactions in 
     the capital stock or other obligations of a Federal Home Loan 
     Bank, for the account of others or for that person's own 
     account, as applicable, is a broker or dealer, as those terms 
     are defined in paragraphs (4) and (5), respectively, of 
     section 3(a) of the Securities Exchange Act of 1934, but is 
     excluded from the definition of--
       (A) the term ``government securities broker'' under section 
     3(a)(43) of the Securities Exchange Act of 1934; and
       (B) the term ``government securities dealer'' under section 
     3(a)(44) of the Securities Exchange Act of 1934.
       (d) Exemption From Reporting Requirements.--The Federal 
     Home Loan Banks shall be exempt from periodic reporting 
     requirements under the securities laws pertaining to the 
     disclosure of--
       (1) related party transactions that occur in the ordinary 
     course of the business of the Banks with members; and
       (2) the unregistered sales of equity securities.
       (e) Tender Offers.--Commission rules relating to tender 
     offers shall not apply in connection with transactions in the 
     capital stock of the Federal Home Loan Banks.
       (f) Regulations.--
       (1) In general.--The Commission shall promulgate such rules 
     and regulations as may be necessary or appropriate in the 
     public interest or in furtherance of this section and the 
     exemptions provided in this section.
       (2) Considerations.--In issuing regulations under this 
     section, the Commission shall consider the distinctive 
     characteristics of

[[Page S6070]]

     the Federal Home Loan Banks when evaluating--
       (A) the accounting treatment with respect to the payment to 
     the Resolution Funding Corporation;
       (B) the role of the combined financial statements of the 
     Federal Home Loan Banks;
       (C) the accounting classification of redeemable capital 
     stock; and
       (D) the accounting treatment related to the joint and 
     several nature of the obligations of the Banks.
       (g) Definitions.--As used in this section--
       (1) the terms ``Bank'', ``Federal Home Loan Bank'', 
     ``member'', and ``Federal Home Loan Bank System'' have the 
     same meanings as in section 2 of the Federal Home Loan Bank 
     Act (12 U.S.C. 1422);
       (2) the term ``Commission'' means the Securities and 
     Exchange Commission; and
       (3) the term ``securities laws'' has the same meaning as in 
     section 3(a)(47) of the Securities Exchange Act of 1934 (15 
     U.S.C. 78c(a)(47)).

     SEC. 1209. VOLUNTARY MERGERS.

       Section 26 of the Federal Home Loan Bank Act (12 U.S.C. 
     1446) is amended--
       (1) by striking ``Whenever'' and inserting ``(a) In 
     General.--Whenever''; and
       (2) by adding at the end the following:
       ``(b) Voluntary Mergers Authorized.--
       ``(1) In general.--Any Federal Home Loan Bank may, with the 
     approval of the Director and of the boards of directors of 
     the Banks involved, merge with another Bank.
       ``(2) Regulations required.--The Director shall promulgate 
     regulations establishing the conditions and procedures for 
     the consideration and approval of any voluntary merger 
     described in paragraph (1), including the procedures for Bank 
     member approval.''.

     SEC. 1210. AUTHORITY TO REDUCE DISTRICTS.

       Section 3 of the Federal Home Loan Bank Act (12 U.S.C. 
     1423) is amended--
       (1) by striking ``As soon'' and inserting ``(a) In 
     General.--As soon''; and
       (2) by adding at the end the following:
       ``(b) Authority to Reduce Districts.--Notwithstanding 
     subsection (a), the number of districts may be reduced to a 
     number less than 8--
       ``(1) pursuant to a voluntary merger between Banks, as 
     approved pursuant to section 26(b); or
       ``(2) pursuant to a decision by the Director to liquidate a 
     Bank pursuant to section 1367 of the Federal Housing 
     Enterprises Financial Safety and Soundness Act of 1992.''.

     SEC. 1211. COMMUNITY FINANCIAL INSTITUTION MEMBERS.

       (a) Total Asset Requirement.--Paragraph (10) of section 2 
     of the Federal Home Loan Bank Act (12 U.S.C. 1422(10)), as so 
     redesignated by section 201(3) of this Act, is amended by 
     striking ``$500,000,000'' each place such term appears and 
     inserting ``$1,000,000,000''.
       (b) Use of Advances for Community Development Activities.--
     Section 10(a) of the Federal Home Loan Bank Act (12 U.S.C. 
     1430(a)) is amended--
       (1) in paragraph (2)(B)--
       (A) by striking ``and''; and
       (B) by inserting ``, and community development activities'' 
     before the period at the end;
       (2) in paragraph (3)(E), by inserting ``or community 
     development activities'' after ``agriculture,''; and
       (3) in paragraph (6)--
       (A) by striking ``and''; and
       (B) by inserting ``, and `community development activities' 
     '' before ``shall''.

     SEC. 1212. PUBLIC USE DATA BASE; REPORTS TO CONGRESS.

       Section 10 of the Federal Home Loan Bank Act (12 U.S.C. 
     1430) is amended--
       (1) in subsection (j)(12)--
       (A) by striking subparagraph (C) and inserting the 
     following:
       ``(C) Reports.--The Director shall annually report to the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate and the Committee on Financial Services of the House 
     of Representatives on the collateral pledged to the Banks, 
     including an analysis of collateral by type and by Bank 
     district.''; and
       (B) by adding at the end the following:
       ``(D) Submission to congress.--The Director shall submit 
     the reports under subparagraphs (A) and (C) to the Committee 
     on Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives, not later than 180 days after the date of 
     enactment of the Federal Housing Finance Regulatory Reform 
     Act of 2008.''; and
       (2) by adding at the end the following:
       ``(k) Public Use Database.--
       ``(1) Data.--Each Federal Home Loan Bank shall provide to 
     the Director, in a form determined by the Director, census 
     tract level data relating to mortgages purchased, if any, 
     including--
       ``(A) data consistent with that reported under section 1323 
     of the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992;
       ``(B) data elements required to be reported under the Home 
     Mortgage Disclosure Act of 1975; and
       ``(C) any other data elements that the Director considers 
     appropriate.
       ``(2) Public use database.--
       ``(A) In general.--The Director shall make available to the 
     public, in a form that is useful to the public (including 
     forms accessible electronically), and to the extent 
     practicable, the data provided to the Director under 
     paragraph (1).
       ``(B) Proprietary information.--Not withstanding 
     subparagraph (A), the Director may not provide public access 
     to, or disclose to the public, any information required to be 
     submitted under this subsection that the Director determines 
     is proprietary or that would provide personally identifiable 
     information and that is not otherwise publicly accessible 
     through other forms, unless the Director determines that it 
     is in the public interest to provide such information.''.

     SEC. 1213. SEMIANNUAL REPORTS.

       Section 21B of the Federal Home Loan Bank Act is amended in 
     subsection (f)(2)(C), by adding at the end the following:
       ``(v) Semiannual reports.--The Director shall report 
     semiannually to the Committee on Banking, Housing, and Urban 
     Affairs of the Senate and the Committee on Financial Services 
     of the House of Representatives on the projected date for the 
     completion of contributions required by this section.''.

     SEC. 1214. LIQUIDATION OR REORGANIZATION OF A FEDERAL HOME 
                   LOAN BANK.

       Section 26 of the Federal Home Loan Bank Act (12 U.S.C. 
     1446) is amended by adding at the end the following: ``At 
     least 30 days prior to liquidating or reorganizing any Bank 
     under this section, the Director shall notify the Bank of its 
     determination and the facts and circumstances upon which such 
     determination is based. The Bank may contest that 
     determination in a hearing before the Director, in which all 
     issues shall be determined on the record pursuant to section 
     554 of title 5, United States Code.''.

     SEC. 1215. STUDY AND REPORT TO CONGRESS ON SECURITIZATION OF 
                   ACQUIRED MEMBER ASSETS.

       (a) Study.--The Director shall conduct a study on 
     securitization of home mortgage loans purchased or to be 
     purchased from member financial institutions under the 
     Acquired Member Assets programs. In conducting the study, the 
     Director shall establish a process for the formal submission 
     of comments.
       (b) Elements.--The study shall encompass--
       (1) the benefits and risks associated with securitization 
     of Acquired Member Assets;
       (2) the potential impact of securitization upon liquidity 
     in the mortgage and broader credit markets;
       (3) the ability of the Federal Home Loan Bank or Banks in 
     question to manage the risks associated with such a program;
       (4) the impact of such a program on the existing activities 
     of the Banks, including their mortgage portfolios and 
     advances; and
       (5) the joint and several liability of the Banks and the 
     cooperative structure of the Federal Home Loan Bank System.
       (c) Consultations.--In conducting the study under this 
     section, the Director shall consult with the Federal Home 
     Loan Banks, the Banks' fiscal agent, representatives of the 
     mortgage lending industry, practitioners in the structured 
     finance field, and other experts as needed.
       (d) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Director shall submit a report to 
     Congress on the results of the study conducted under 
     subsection (a), including policy recommendations based on the 
     analysis of the Director of the feasibility of mortgage-
     backed securities issuance by a Federal Home Loan Bank or 
     Banks and the risks and benefits associated with such program 
     or programs.
       (e) Definitions.--As used in this section, the terms 
     ``member'', ``Bank'', and ``Federal Home Loan Bank'' have the 
     same meanings as in section 2 of the Federal Home Loan Bank 
     Act (12 U.S.C. 1422).

     SEC. 1216. TECHNICAL AND CONFORMING AMENDMENTS.

       (a) Right to Financial Privacy Act of 1978.--Section 
     1113(o) of the Right to Financial Privacy Act of 1978 (12 
     U.S.C. 3413(o)) is amended--
       (1) by striking ``Federal Housing Finance Board'' and 
     inserting ``Federal Housing Finance Agency''; and
       (2) by striking ``Federal Housing Finance Board's'' and 
     inserting ``Federal Housing Finance Agency's''.
       (b) Riegle Community Development and Regulatory Improvement 
     Act of 1994.--Section 117(e) of the Riegle Community 
     Development and Regulatory Improvement Act of 1994 (12 U.S.C. 
     4716(e)) is amended by striking ``Federal Housing Finance 
     Board'' and inserting ``Federal Housing Finance Agency''.
       (c) Title 18, United States Code.--Title 18, United States 
     Code, is amended by striking ``Federal Housing Finance 
     Board'' each place such term appears in each of sections 212, 
     657, 1006, and 1014, and inserting ``Federal Housing Finance 
     Agency''.
       (d) MAHRA Act of 1997.--Section 517(b)(4) of the 
     Multifamily Assisted Housing Reform and Affordability Act of 
     1997 (42 U.S.C. 1437f note) is amended by striking ``Federal 
     Housing Finance Board'' and inserting ``Federal Housing 
     Finance Agency''.
       (e) Title 44, United States Code.--Section 3502(5) of title 
     44, United States Code, is amended by striking ``Federal 
     Housing Finance Board'' and inserting ``Federal Housing 
     Finance Agency''.
       (f) Access to Local TV Act of 2000.--Section 
     1004(d)(2)(D)(iii) of the Launching Our Communities' Access 
     to Local Television Act of 2000 (47 U.S.C. 
     1103(d)(2)(D)(iii)) is amended by striking ``Office of 
     Federal Housing Enterprise Oversight, the Federal Housing 
     Finance Board'' and inserting ``Federal Housing Finance 
     Agency''.

[[Page S6071]]

       (g) FIRREA.--Section 1216 of the Financial Institutions 
     Reform, Recovery, and Enhancement Act of 1989 (12 U.S.C. 
     1833e) is amended--
       (1) in subsection (a), by striking paragraph (3) and 
     inserting the following:
       ``(3) the Federal Housing Finance Agency;'';
       (2) in subsection (b), by striking ``Federal National 
     Mortgage Association'' and inserting ``Federal Home Loan 
     Banks, the Federal National Mortgage Association,''; and
       (3) in subsection (c), by striking ``Finance Board'' and 
     inserting ``Finance Agency''.

     SEC. 1217. STUDY ON FEDERAL HOME LOAN BANK ADVANCES.

       (a) In General.--Not later than 1 year after the date of 
     enactment of this Act, the Director shall conduct a study and 
     submit a report to the Committee on Banking, Housing, and 
     Urban Affairs of the Senate and the Committee on Financial 
     Services of the House or Representatives on the extent to 
     which loans and securities used as collateral to support 
     Federal Home Loan Bank advances are consistent with the 
     interagency guidance on nontraditional mortgage products.
       (b) Required Content.--The study required under subsection 
     (a) shall--
       (1) consider and recommend any additional regulations, 
     guidance, advisory bulletins, or other administrative actions 
     necessary to ensure that the Federal Home Loan Banks are not 
     supporting loans with predatory characteristics; and
       (2) include an opportunity for the public to comment on any 
     recommendations made under paragraph (1).

     SEC. 1218. FEDERAL HOME LOAN BANK REFINANCING AUTHORITY FOR 
                   CERTAIN RESIDENTIAL MORTGAGE LOANS.

       Section 10(j)(2) of the Federal Home Loan Bank Act (12 
     U.S.C. 1430(j)(2)) is amended--
       (1) in subparagraph (A), by striking ``or'' at the end;
       (2) in subparagraph (B), by striking the period at the end 
     and inserting ``; or''; and
       (3) by adding at the end the following:
       ``(C) during the 2-year period beginning on the date of 
     enactment of this subparagraph, refinance loans that are 
     secured by a first mortgage on a primary residence of any 
     family having an income at or below 80 percent of the median 
     income for the area.''.

TITLE III--TRANSFER OF FUNCTIONS, PERSONNEL, AND PROPERTY OF OFHEO AND 
                   THE FEDERAL HOUSING FINANCE BOARD

                           Subtitle A--OFHEO

     SEC. 1301. ABOLISHMENT OF OFHEO.

       (a) In General.--Effective at the end of the 1-year period 
     beginning on the date of enactment of this Act, the Office of 
     Federal Housing Enterprise Oversight of the Department of 
     Housing and Urban Development and the positions of the 
     Director and Deputy Director of such Office are abolished.
       (b) Disposition of Affairs.--During the 1-year period 
     beginning on the date of enactment of this Act, the Director 
     of the Office of Federal Housing Enterprise Oversight, solely 
     for the purpose of winding up the affairs of the Office of 
     Federal Housing Enterprise Oversight--
       (1) shall manage the employees of such Office and provide 
     for the payment of the compensation and benefits of any such 
     employee which accrue before the effective date of the 
     transfer of such employee under section 1303; and
       (2) may take any other action necessary for the purpose of 
     winding up the affairs of the Office.
       (c) Status of Employees Before Transfer.--The amendments 
     made by title I and the abolishment of the Office of Federal 
     Housing Enterprise Oversight under subsection (a) of this 
     section may not be construed to affect the status of any 
     employee of such Office as an employee of an agency of the 
     United States for purposes of any other provision of law 
     before the effective date of the transfer of any such 
     employee under section 1303.
       (d) Use of Property and Services.--
       (1) Property.--The Director may use the property of the 
     Office of Federal Housing Enterprise Oversight to perform 
     functions which have been transferred to the Director for 
     such time as is reasonable to facilitate the orderly transfer 
     of functions transferred under any other provision of this 
     Act or any amendment made by this Act to any other provision 
     of law.
       (2) Agency services.--Any agency, department, or other 
     instrumentality of the United States, and any successor to 
     any such agency, department, or instrumentality, which was 
     providing supporting services to the Office of Federal 
     Housing Enterprise Oversight before the expiration of the 
     period under subsection (a) in connection with functions that 
     are transferred to the Director shall--
       (A) continue to provide such services, on a reimbursable 
     basis, until the transfer of such functions is complete; and
       (B) consult with any such agency to coordinate and 
     facilitate a prompt and reasonable transition.
       (e) Continuation of Services.--The Director may use the 
     services of employees and other personnel of the Office of 
     Federal Housing Enterprise Oversight, on a reimbursable 
     basis, to perform functions which have been transferred to 
     the Director for such time as is reasonable to facilitate the 
     orderly transfer of functions pursuant to any other provision 
     of this Act or any amendment made by this Act to any other 
     provision of law.
       (f) Savings Provisions.--
       (1) Existing rights, duties, and obligations not 
     affected.--Subsection (a) shall not affect the validity of 
     any right, duty, or obligation of the United States, the 
     Director of the Office of Federal Housing Enterprise 
     Oversight, or any other person, which--
       (A) arises under--
       (i) the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992;
       (ii) the Federal National Mortgage Association Charter Act;
       (iii) the Federal Home Loan Mortgage Corporation Act; or
       (iv) any other provision of law applicable with respect to 
     such Office; and
       (B) existed on the day before the date of abolishment under 
     subsection (a).
       (2) Continuation of suits.--No action or other proceeding 
     commenced by or against the Director of the Office of Federal 
     Housing Enterprise Oversight in connection with functions 
     that are transferred to the Director of the Federal Housing 
     Finance Agency shall abate by reason of the enactment of this 
     Act, except that the Director of the Federal Housing Finance 
     Agency shall be substituted for the Director of the Office of 
     Federal Housing Enterprise Oversight as a party to any such 
     action or proceeding.

     SEC. 1302. CONTINUATION AND COORDINATION OF CERTAIN ACTIONS.

       (a) In General.--All regulations, orders, and 
     determinations described in subsection (b) shall remain in 
     effect according to the terms of such regulations, orders, 
     and determinations, and shall be enforceable by or against 
     the Director or the Secretary of Housing and Urban 
     Development, as the case may be, until modified, terminated, 
     set aside, or superseded in accordance with applicable law by 
     the Director or the Secretary, as the case may be, any court 
     of competent jurisdiction, or operation of law.
       (b) Applicability.--A regulation, order, or determination 
     is described in this subsection if it--
       (1) was issued, made, prescribed, or allowed to become 
     effective by--
       (A) the Office of Federal Housing Enterprise Oversight;
       (B) the Secretary of Housing and Urban Development, and 
     relates to the authority of the Secretary under--
       (i) the Federal Housing Enterprises Financial Safety and 
     Soundness Act of 1992;
       (ii) the Federal National Mortgage Association Charter Act, 
     with respect to the Federal National Mortgage Association; or
       (iii) the Federal Home Loan Mortgage Corporation Act, with 
     respect to the Federal Home Loan Mortgage Corporation; or
       (C) a court of competent jurisdiction, and relates to 
     functions transferred by this Act; and
       (2) is in effect on the effective date of the abolishment 
     under section 1301(a).

     SEC. 1303. TRANSFER AND RIGHTS OF EMPLOYEES OF OFHEO.

       (a) Transfer.--Each employee of the Office of Federal 
     Housing Enterprise Oversight shall be transferred to the 
     Agency for employment, not later than the effective date of 
     the abolishment under section 1301(a), and such transfer 
     shall be deemed a transfer of function for purposes of 
     section 3503 of title 5, United States Code.
       (b) Guaranteed Positions.--
       (1) In general.--Each employee transferred under subsection 
     (a) shall be guaranteed a position with the same status, 
     tenure, grade, and pay as that held on the day immediately 
     preceding the transfer.
       (2) No involuntary separation or reduction.--An employee 
     transferred under subsection (a) holding a permanent position 
     on the day immediately preceding the transfer may not be 
     involuntarily separated or reduced in grade or compensation 
     during the 12-month period beginning on the date of transfer, 
     except for cause, or, in the case of a temporary employee, 
     separated in accordance with the terms of the appointment of 
     the employee.
       (c) Appointment Authority for Excepted and Senior Executive 
     Service Employees.--
       (1) In general.--In the case of an employee occupying a 
     position in the excepted service or the Senior Executive 
     Service, any appointment authority established under law or 
     by regulations of the Office of Personnel Management for 
     filling such position shall be transferred, subject to 
     paragraph (2).
       (2) Decline of transfer.--The Director may decline a 
     transfer of authority under paragraph (1) to the extent that 
     such authority relates to--
       (A) a position excepted from the competitive service 
     because of its confidential, policymaking, policy-
     determining, or policy-advocating character; or
       (B) a noncareer position in the Senior Executive Service 
     (within the meaning of section 3132(a)(7) of title 5, United 
     States Code).
       (d) Reorganization.--If the Director determines, after the 
     end of the 1-year period beginning on the effective date of 
     the abolishment under section 1301(a), that a reorganization 
     of the combined workforce is required, that reorganization 
     shall be deemed a major reorganization for purposes of 
     affording affected employee retirement under section 
     8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code.
       (e) Employee Benefit Programs.--
       (1) In general.--Any employee of the Office of Federal 
     Housing Enterprise Oversight accepting employment with the 
     Agency as a result of a transfer under subsection (a) may 
     retain, for 12 months after the date on which such transfer 
     occurs, membership in any employee benefit program of the 
     Agency or the

[[Page S6072]]

     Office of Federal Housing Enterprise Oversight of the 
     Department of Housing and Urban Development, as applicable, 
     including insurance, to which such employee belongs on the 
     date of the abolishment under section 1301(a), if--
       (A) the employee does not elect to give up the benefit or 
     membership in the program; and
       (B) the benefit or program is continued by the Director of 
     the Federal Housing Finance Agency.
       (2) Cost differential.--
       (A) In general.--The difference in the costs between the 
     benefits which would have been provided by the Office of 
     Federal Housing Enterprise Oversight and those provided by 
     this section shall be paid by the Director.
       (B) Health insurance.--If any employee elects to give up 
     membership in a health insurance program or the health 
     insurance program is not continued by the Director, the 
     employee shall be permitted to select an alternate Federal 
     health insurance program not later than 30 days after the 
     date of such election or notice, without regard to any other 
     regularly scheduled open season.

     SEC. 1304. TRANSFER OF PROPERTY AND FACILITIES.

       Upon the effective date of its abolishment under section 
     1301(a), all property of the Office of Federal Housing 
     Enterprise Oversight shall transfer to the Agency.

               Subtitle B--Federal Housing Finance Board

     SEC. 1311. ABOLISHMENT OF THE FEDERAL HOUSING FINANCE BOARD.

       (a) In General.--Effective at the end of the 1-year period 
     beginning on the date of enactment of this Act, the Federal 
     Housing Finance Board (in this subtitle referred to as the 
     ``Board'') is abolished.
       (b) Disposition of Affairs.--During the 1-year period 
     beginning on the date of enactment of this Act, the Board, 
     solely for the purpose of winding up the affairs of the 
     Board--
       (1) shall manage the employees of the Board and provide for 
     the payment of the compensation and benefits of any such 
     employee which accrue before the effective date of the 
     transfer of such employee under section 1313; and
       (2) may take any other action necessary for the purpose of 
     winding up the affairs of the Board.
       (c) Status of Employees Before Transfer.--The amendments 
     made by titles I and II and the abolishment of the Board 
     under subsection (a) may not be construed to affect the 
     status of any employee of the Board as an employee of an 
     agency of the United States for purposes of any other 
     provision of law before the effective date of the transfer of 
     any such employee under section 1313.
       (d) Use of Property and Services.--
       (1) Property.--The Director may use the property of the 
     Board to perform functions which have been transferred to the 
     Director, for such time as is reasonable to facilitate the 
     orderly transfer of functions transferred under any other 
     provision of this Act or any amendment made by this Act to 
     any other provision of law.
       (2) Agency services.--Any agency, department, or other 
     instrumentality of the United States, and any successor to 
     any such agency, department, or instrumentality, which was 
     providing supporting services to the Board before the 
     expiration of the 1-year period under subsection (a) in 
     connection with functions that are transferred to the 
     Director shall--
       (A) continue to provide such services, on a reimbursable 
     basis, until the transfer of such functions is complete; and
       (B) consult with any such agency to coordinate and 
     facilitate a prompt and reasonable transition.
       (e) Continuation of Services.--The Director may use the 
     services of employees and other personnel of the Board, on a 
     reimbursable basis, to perform functions which have been 
     transferred to the Director for such time as is reasonable to 
     facilitate the orderly transfer of functions pursuant to any 
     other provision of this Act or any amendment made by this Act 
     to any other provision of law.
       (f) Savings Provisions.--
       (1) Existing rights, duties, and obligations not 
     affected.--Subsection (a) shall not affect the validity of 
     any right, duty, or obligation of the United States, a member 
     of the Board, or any other person, which--
       (A) arises under the Federal Home Loan Bank Act, or any 
     other provision of law applicable with respect to the Board; 
     and
       (B) existed on the day before the effective date of the 
     abolishment under subsection (a).
       (2) Continuation of suits.--No action or other proceeding 
     commenced by or against the Board in connection with 
     functions that are transferred under this Act to the Director 
     shall abate by reason of the enactment of this Act, except 
     that the Director shall be substituted for the Board or any 
     member thereof as a party to any such action or proceeding.

     SEC. 1312. CONTINUATION AND COORDINATION OF CERTAIN ACTIONS.

       (a) In General.--All regulations, orders, determinations, 
     and resolutions described under subsection (b) shall remain 
     in effect according to the terms of such regulations, orders, 
     determinations, and resolutions, and shall be enforceable by 
     or against the Director until modified, terminated, set 
     aside, or superseded in accordance with applicable law by the 
     Director, any court of competent jurisdiction, or operation 
     of law.
       (b) Applicability.--A regulation, order, determination, or 
     resolution is described under this subsection if it--
       (1) was issued, made, prescribed, or allowed to become 
     effective by--
       (A) the Board; or
       (B) a court of competent jurisdiction, and relates to 
     functions transferred by this Act; and
       (2) is in effect on the effective date of the abolishment 
     under section 1311(a).

     SEC. 1313. TRANSFER AND RIGHTS OF EMPLOYEES OF THE FEDERAL 
                   HOUSING FINANCE BOARD.

       (a) Transfer.--Each employee of the Board shall be 
     transferred to the Agency for employment, not later than the 
     effective date of the abolishment under section 1311(a), and 
     such transfer shall be deemed a transfer of function for 
     purposes of section 3503 of title 5, United States Code.
       (b) Guaranteed Positions.--
       (1) In general.--Each employee transferred under subsection 
     (a) shall be guaranteed a position with the same status, 
     tenure, grade, and pay as that held on the day immediately 
     preceding the transfer.
       (2) No involuntary separation or reduction.--An employee 
     holding a permanent position on the day immediately preceding 
     the transfer may not be involuntarily separated or reduced in 
     grade or compensation during the 12-month period beginning on 
     the date of transfer, except for cause, or, if the employee 
     is a temporary employee, separated in accordance with the 
     terms of the appointment of the employee.
       (c) Appointment Authority for Excepted Employees.--
       (1) In general.--In the case of an employee occupying a 
     position in the excepted service, any appointment authority 
     established under law or by regulations of the Office of 
     Personnel Management for filling such position shall be 
     transferred, subject to paragraph (2).
       (2) Decline of transfer.--The Director may decline a 
     transfer of authority under paragraph (1), to the extent that 
     such authority relates to a position excepted from the 
     competitive service because of its confidential, 
     policymaking, policy-determining, or policy-advocating 
     character.
       (d) Reorganization.--If the Director determines, after the 
     end of the 1-year period beginning on the effective date of 
     the abolishment under section 1311(a), that a reorganization 
     of the combined workforce is required, that reorganization 
     shall be deemed a major reorganization for purposes of 
     affording affected employee retirement under section 
     8336(d)(2) or 8414(b)(1)(B) of title 5, United States Code.
       (e) Employee Benefit Programs.--
       (1) In general.--Any employee of the Board accepting 
     employment with the Agency as a result of a transfer under 
     subsection (a) may retain, for 12 months after the date on 
     which such transfer occurs, membership in any employee 
     benefit program of the Agency or the Board, as applicable, 
     including insurance, to which such employee belongs on the 
     effective date of the abolishment under section 1311(a) if--
       (A) the employee does not elect to give up the benefit or 
     membership in the program; and
       (B) the benefit or program is continued by the Director.
       (2) Cost differential.--
       (A) In general.--The difference in the costs between the 
     benefits which would have been provided by the Board and 
     those provided by this section shall be paid by the Director.
       (B) Health insurance.--If any employee elects to give up 
     membership in a health insurance program or the health 
     insurance program is not continued by the Director, the 
     employee shall be permitted to select an alternate Federal 
     health insurance program not later than 30 days after the 
     date of such election or notice, without regard to any other 
     regularly scheduled open season.

     SEC. 1314. TRANSFER OF PROPERTY AND FACILITIES.

       Upon the effective date of the abolishment under section 
     1311(a), all property of the Board shall transfer to the 
     Agency.

                     TITLE IV--HOPE FOR HOMEOWNERS

     SEC. 1401. SHORT TITLE.

       This title may be cited as the ``HOPE for Homeowners Act of 
     2008''.

     SEC. 1402. ESTABLISHMENT OF HOPE FOR HOMEOWNERS PROGRAM.

       (a) Establishment.--Title II of the National Housing Act 
     (12 U.S.C. 1707 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 257. HOPE FOR HOMEOWNERS PROGRAM.

       ``(a) Establishment.--There is established in the Federal 
     Housing Administration a HOPE for Homeowners Program.
       ``(b) Purpose.--The purpose of the HOPE for Homeowners 
     Program is--
       ``(1) to create an FHA program, participation in which is 
     voluntary on the part of homeowners and existing loan holders 
     to insure refinanced loans for distressed borrowers to 
     support long-term, sustainable homeownership;
       ``(2) to allow homeowners to avoid foreclosure by reducing 
     the principle balance outstanding, and interest rate charged, 
     on their mortgages;
       ``(3) to help stabilize and provide confidence in mortgage 
     markets by bringing transparency to the value of assets based 
     on mortgage assets;
       ``(4) to target mortgage assistance under this section to 
     homeowners for their principal residence;
       ``(5) to enhance the administrative capacity of the FHA to 
     carry out its expanded role under the HOPE for Homeowners 
     Program;

[[Page S6073]]

       ``(6) to ensure the HOPE for Homeowners Program remains in 
     effect only for as long as is necessary to provide stability 
     to the housing market; and
       ``(7) to provide servicers of delinquent mortgages with 
     additional methods and approaches to avoid foreclosure.
       ``(c) Establishment and Implementation of Program 
     Requirements.--
       ``(1) Duties of the board.--In order to carry out the 
     purposes of the HOPE for Homeowners Program, the Board 
     shall--
       ``(A) establish requirements and standards for the program; 
     and
       ``(B) prescribe such regulations and provide such guidance 
     as may be necessary or appropriate to implement such 
     requirements and standards.
       ``(2) Duties of the secretary.--In carrying out any of the 
     program requirements or standards established under paragraph 
     (1), the Secretary may issue such interim guidance and 
     mortgagee letters as the Secretary determines necessary or 
     appropriate.
       ``(d) Insurance of Mortgages.--The Secretary is authorized 
     upon application of a mortgagee to make commitments to insure 
     or to insure any eligible mortgage that has been refinanced 
     in a manner meeting the requirements under subsection (e).
       ``(e) Requirements of Insured Mortgages.--To be eligible 
     for insurance under this section, a refinanced eligible 
     mortgage shall comply with all of the following requirements:
       ``(1) Lack of capacity to pay existing mortgage.--
       ``(A) Borrower certification.--
       ``(i) In general.--The mortgagor shall provide 
     certification to the Secretary that the mortgagor has not 
     intentionally defaulted on the mortgage or any other debt, 
     and has not knowingly, or willfully and with actual 
     knowledge, furnished material information known to be false 
     for the purpose of obtaining any eligible mortgage.
       ``(ii) Penalties.--

       ``(I) False statement.--Any certification filed pursuant to 
     clause (i) shall contain an acknowledgment that any willful 
     false statement made in such certification is punishable 
     under section 1001, of title 18, United States Code, by fine 
     or imprisonment of not more than 5 years, or both.
       ``(II) Liability for repayment.--The mortgagor shall agree 
     in writing that the mortgagor shall be liable to repay to the 
     Federal Housing Administration any direct financial benefit 
     achieved from the reduction of indebtedness on the existing 
     mortgage or mortgages on the residence refinanced under this 
     section derived from misrepresentations made in the 
     certifications and documentation required under this 
     subparagraph, subject to the discretion of the Secretary.

       ``(B) Current borrower debt-to-income ratio.--As of March 
     1, 2008, the mortgagor shall have had a ratio of mortgage 
     debt to income, taking into consideration all existing 
     mortgages of that mortgagor at such time, greater than 31 
     percent (or such higher amount as the Board determines 
     appropriate).
       ``(2) Determination of principal obligation amount.--The 
     principal obligation amount of the refinanced eligible 
     mortgage to be insured shall--
       ``(A) be determined by the reasonable ability of the 
     mortgagor to make his or her mortgage payments, as such 
     ability is determined by the Secretary pursuant to section 
     203(b)(4) or by any other underwriting standards established 
     by the Board; and
       ``(B) not exceed 90 percent of the appraised value of the 
     property to which such mortgage relates.
       ``(3) Required waiver of prepayment penalties and fees.--
     All penalties for prepayment or refinancing of the eligible 
     mortgage, and all fees and penalties related to default or 
     delinquency on the eligible mortgage, shall be waived or 
     forgiven.
       ``(4) Extinguishment of subordinate liens.--
       ``(A) Required agreement.--All holders of outstanding 
     mortgage liens on the property to which the eligible mortgage 
     relates shall agree to accept the proceeds of the insured 
     loan as payment in full of all indebtedness under the 
     eligible mortgage, and all encumbrances related to such 
     eligible mortgage shall be removed. The Secretary may take 
     such actions, subject to standards established by the Board 
     under subparagraph (B), as may be necessary and appropriate 
     to facilitate coordination and agreement between the holders 
     of the existing senior mortgage and any existing subordinate 
     mortgages, taking into consideration the subordinate lien 
     status of such subordinate mortgages.
       ``(B) Shared appreciation.--
       ``(i) In general.--The Board shall establish standards and 
     policies that will allow for the payment to the holder of any 
     existing subordinate mortgage of a portion of any future 
     appreciation in the property secured by such eligible 
     mortgage that is owed to the Secretary pursuant to subsection 
     (k).
       ``(ii) Factors.--In establishing the standards and policies 
     required under clause (i), the Board shall take into 
     consideration--

       ``(I) the status of any subordinate mortgage;
       ``(II) the outstanding principal balance of and accrued 
     interest on the existing senior mortgage and any outstanding 
     subordinate mortgages;
       ``(III) the extent to which the current appraised value of 
     the property securing a subordinate mortgage is less than the 
     outstanding principal balance and accrued interest on any 
     other liens that are senior to such subordinate mortgage; and
       ``(IV) such other factors as the Board determines to be 
     appropriate.

       ``(C) Voluntary program.--This paragraph may not be 
     construed to require any holder of any existing mortgage to 
     participate in the program under this section generally, or 
     with respect to any particular loan.
       ``(5) Term of mortgage.--The refinanced eligible mortgage 
     to be insured shall--
       ``(A) bear interest at a single rate that is fixed for the 
     entire term of the mortgage; and
       ``(B) have a maturity of not less than 30 years from the 
     date of the beginning of amortization of such refinanced 
     eligible mortgage.
       ``(6) Maximum loan amount.--The principal obligation amount 
     of the eligible mortgage to be insured shall not exceed 132 
     percent of the dollar amount limitation in effect for 2007 
     under section 305(a)(2) of the Federal Home Loan Mortgage 
     Corporation Act (12 U.S.C. 1454(a)(2)) for a property of the 
     applicable size.
       ``(7) Prohibition on second liens.--A mortgagor may not 
     grant a new second lien on the mortgaged property during the 
     first 5 years of the term of the mortgage insured under this 
     section.
       ``(8) Appraisals.--Any appraisal conducted in connection 
     with a mortgage insured under this section shall--
       ``(A) be based on the current value of the property;
       ``(B) be conducted in accordance with title XI of the 
     Financial Institutions Reform, Recovery, and Enforcement Act 
     of 1989 (12 U.S.C. 3331 et seq.);
       ``(C) be completed by an appraiser who meets the competency 
     requirements of the Uniform Standards of Professional 
     Appraisal Practice;
       ``(D) be wholly consistent with the appraisal standards, 
     practices, and procedures under section 202(e) of this Act 
     that apply to all loans insured under this Act; and
       ``(E) comply with the requirements of subsection (g) of 
     this section (relating to appraisal independence).
       ``(9) Documentation and verification of income.--In 
     complying with the FHA underwriting requirements under the 
     HOPE for Homeowners Program under this section, the mortgagee 
     under the mortgage shall document and verify the income of 
     the mortgagor by procuring an Internal Revenue Service 
     transcript of the income tax returns of the mortgagor for the 
     2 most recent years for which the filing deadline for such 
     years has passed and by any other method, in accordance with 
     procedures and standards that the Board or the Secretary 
     shall establish.
       ``(10) Mortgage fraud.--The mortgagor shall not have been 
     convicted under any provision of Federal or State law for 
     fraud, including mortgage fraud.
       ``(11) Primary residence.--The mortgagor shall provide 
     documentation satisfactory in the determination of the 
     Secretary to prove that the residence covered by the mortgage 
     to be insured under this section is occupied by the mortgagor 
     as the primary residence of the mortgagor, and that such 
     residence is the only residence in which the mortgagor has 
     any present ownership interest.
       ``(f) Study of Auction or Bulk Refinance Program.--
       ``(1) Study.--The Board shall conduct a study of the need 
     for and efficacy of an auction or bulk refinancing mechanism 
     to facilitate refinancing of existing residential mortgages 
     that are at risk for foreclosure into mortgages insured under 
     this section. The study shall identify and examine various 
     options for mechanisms under which lenders and servicers of 
     such mortgages may make bids for forward commitments for such 
     insurance in an expedited manner.
       ``(2) Content.--
       ``(A) Analysis.--The study required under paragraph (1) 
     shall analyze--
       ``(i) the feasibility of establishing a mechanism that 
     would facilitate the more rapid refinancing of borrowers at 
     risk of foreclosure into performing mortgages insured under 
     this section;
       ``(ii) whether such a mechanism would provide an effective 
     and efficient mechanism to reduce foreclosures on qualified 
     existing mortgages;
       ``(iii) whether the use of an auction or bulk refinance 
     program is necessary to stabilize the housing market and 
     reduce the impact of turmoil in that market on the economy of 
     the United States;
       ``(iv) whether there are other mechanisms or authority that 
     would be useful to reduce foreclosure; and
       ``(v) and any other factors that the Board considers 
     relevant.
       ``(B) Determinations.--To the extent that the Board finds 
     that a facility of the type described in subparagraph (A) is 
     feasible and useful, the study shall--
       ``(i) determine and identify any additional authority or 
     resources needed to establish and operate such a mechanism;
       ``(ii) determine whether there is a need for additional 
     authority with respect to the loan underwriting criteria 
     established in this section or with respect to eligibility of 
     participating borrowers, lenders, or holders of liens;
       ``(iii) determine whether such underwriting criteria should 
     be established on the basis of individual loans, in the 
     aggregate, or otherwise to facilitate the goal of refinancing 
     borrowers at risk of foreclosure into viable loans insured 
     under this section.
       ``(3) Report.--Not later than the expiration of the 60-day 
     period beginning on the

[[Page S6074]]

     date of the enactment of this section, the Board shall submit 
     a report regarding the results of the study conducted under 
     this subsection to the Committee on Financial Services of the 
     House of Representatives and the Committee on Banking, 
     Housing, and Urban Affairs of the Senate. The report shall 
     include a detailed description of the analysis required under 
     paragraph (2)(A) and of the determinations made pursuant to 
     paragraph (2)(B), and shall include any other findings and 
     recommendations of the Board pursuant to the study, including 
     identifying various options for mechanisms described in 
     paragraph (1).
       ``(g) Appraisal Independence.--
       ``(1) Prohibitions on interested parties in a real estate 
     transaction.--No mortgage lender, mortgage broker, mortgage 
     banker, real estate broker, appraisal management company, 
     employee of an appraisal management company, nor any other 
     person with an interest in a real estate transaction 
     involving an appraisal in connection with a mortgage insured 
     under this section shall improperly influence, or attempt to 
     improperly influence, through coercion, extortion, collusion, 
     compensation, instruction, inducement, intimidation, 
     nonpayment for services rendered, or bribery, the 
     development, reporting, result, or review of a real estate 
     appraisal sought in connection with the mortgage.
       ``(2) Civil monetary penalties.--The Secretary may impose a 
     civil money penalty for any knowing and material violation of 
     paragraph (1) under the same terms and conditions as are 
     authorized in section 536(a) of this Act.
       ``(h) Standards to Protect Against Adverse Selection.--
       ``(1) In general.--The Board shall, by rule or order, 
     establish standards and policies to require the underwriter 
     of the insured loan to provide such representations and 
     warranties as the Board considers necessary or appropriate to 
     enforce compliance with all underwriting and appraisal 
     standards of the HOPE for Homeowners Program.
       ``(2) Exclusion for violations.--The Board shall prohibit 
     the Secretary from paying insurance benefits to a mortgagee 
     who violates the representations and warranties, as 
     established under paragraph (1), or in any case in which a 
     mortgagor fails to make the first payment on a refinanced 
     eligible mortgage.
       ``(3) Other authority.--The Board may establish such other 
     standards or policies as necessary to protect against adverse 
     selection, including requiring loans identified by the 
     Secretary as higher risk loans to demonstrate payment 
     performance for a reasonable period of time prior to being 
     insured under the program.
       ``(i) Premiums.--For each refinanced eligible mortgage 
     insured under this section, the Secretary shall establish and 
     collect--
       ``(1) at the time of insurance, a single premium payment in 
     an amount equal to 3 percent of the amount of the original 
     insured principal obligation of the refinanced eligible 
     mortgage, which shall be paid from the proceeds of the 
     mortgage being insured under this section, through the 
     reduction of the amount of indebtedness that existed on the 
     eligible mortgage prior to refinancing; and
       ``(2) in addition to the premium required under paragraph 
     (1), an annual premium in an amount equal to 1.5 percent of 
     the amount of the remaining insured principal balance of the 
     mortgage.
       ``(j) Origination Fees and Interest Rate.--The Board shall 
     establish--
       ``(1) a reasonable limitation on origination fees for 
     refinanced eligible mortgages insured under this section; and
       ``(2) procedures to ensure that interest rates on such 
     mortgages shall be commensurate with market rate interest 
     rates on such types of loans.
       ``(k) Equity and Appreciation.--
       ``(1) Five-year phase-in for equity as a result of sale or 
     refinancing.--For each eligible mortgage insured under this 
     section, the Secretary and the mortgagor of such mortgage 
     shall, upon any sale or disposition of the property to which 
     such mortgage relates, or upon the subsequent refinancing of 
     such mortgage, be entitled to the following with respect to 
     any equity created as a direct result of such sale or 
     refinancing:
       ``(A) If such sale or refinancing occurs during the period 
     that begins on the date that such mortgage is insured and 
     ends 1 year after such date of insurance, the Secretary shall 
     be entitled to 100 percent of such equity.
       ``(B) If such sale or refinancing occurs during the period 
     that begins 1 year after such date of insurance and ends 2 
     years after such date of insurance, the Secretary shall be 
     entitled to 90 percent of such equity and the mortgagor shall 
     be entitled to 10 percent of such equity.
       ``(C) If such sale or refinancing occurs during the period 
     that begins 2 years after such date of insurance and ends 3 
     years after such date of insurance, the Secretary shall be 
     entitled to 80 percent of such equity and the mortgagor shall 
     be entitled to 20 percent of such equity.
       ``(D) If such sale or refinancing occurs during the period 
     that begins 3 years after such date of insurance and ends 4 
     years after such date of insurance, the Secretary shall be 
     entitled to 70 percent of such equity and the mortgagor shall 
     be entitled to 30 percent of such equity.
       ``(E) If such sale or refinancing occurs during the period 
     that begins 4 years after such date of insurance and ends 5 
     years after such date of insurance, the Secretary shall be 
     entitled to 60 percent of such equity and the mortgagor shall 
     be entitled to 40 percent of such equity.
       ``(F) If such sale or refinancing occurs during any period 
     that begins 5 years after such date of insurance, the 
     Secretary shall be entitled to 50 percent of such equity and 
     the mortgagor shall be entitled to 50 percent of such equity.
       ``(2) Appreciation in value.--For each eligible mortgage 
     insured under this section, the Secretary and the mortgagor 
     of such mortgage shall, upon any sale or disposition of the 
     property to which such mortgage relates, each be entitled to 
     50 percent of any appreciation in value of the appraised 
     value of such property that has occurred since the date that 
     such mortgage was insured under this section.
       ``(l) Establishment of HOPE Fund.--
       ``(1) In general.--There is established in the Federal 
     Housing Administration a revolving fund to be known as the 
     Home Ownership Preservation Entity Fund, which shall be used 
     by the Board for carrying out the mortgage insurance 
     obligations under this section.
       ``(2) Management of fund.--The HOPE Fund shall be 
     administered and managed by the Secretary, who shall 
     establish reasonable and prudent criteria for the management 
     and operation of any amounts in the HOPE Fund.
       ``(m) Limitation on Aggregate Insurance Authority.--The 
     aggregate original principal obligation of all mortgages 
     insured under this section may not exceed $300,000,000,000.
       ``(n) Reports by the Board.--The Board shall submit monthly 
     reports to the Congress identifying the progress of the HOPE 
     for Homeowners Program, which shall contain the following 
     information for each month:
       ``(1) The number of new mortgages insured under this 
     section, including the location of the properties subject to 
     such mortgages by census tract.
       ``(2) The aggregate principal obligation of new mortgages 
     insured under this section.
       ``(3) The average amount by which the principle balance 
     outstanding on mortgages insured this section was reduced.
       ``(4) The amount of premiums collected for insurance of 
     mortgages under this section.
       ``(5) The claim and loss rates for mortgages insured under 
     this section.
       ``(6) Any other information that the Board considers 
     appropriate.
       ``(o) Required Outreach Efforts.--The Secretary shall carry 
     out outreach efforts to ensure that homeowners, lenders, and 
     the general public are aware of the opportunities for 
     assistance available under this section.
       ``(p) Enhancement of FHA Capacity.--Under the direction of 
     the Board, the Secretary shall take such actions as may be 
     necessary to--
       ``(1) contract for the establishment of underwriting 
     criteria, automated underwriting systems, pricing standards, 
     and other factors relating to eligibility for mortgages 
     insured under this section;
       ``(2) contract for independent quality reviews of 
     underwriting, including appraisal reviews and fraud 
     detection, of mortgages insured under this section or pools 
     of such mortgages; and
       ``(3) increase personnel of the Department as necessary to 
     process or monitor the processing of mortgages insured under 
     this section.
       ``(q) GNMA Commitment Authority.--
       ``(1) Guarantees.--The Secretary shall take such actions as 
     may be necessary to ensure that securities based on and 
     backed by a trust or pool composed of mortgages insured under 
     this section are available to be guaranteed by the Government 
     National Mortgage Association as to the timely payment of 
     principal and interest.
       ``(2) Guarantee authority.--To carry out the purposes of 
     section 306 of the National Housing Act (12 U.S.C. 1721), the 
     Government National Mortgage Association may enter into new 
     commitments to issue guarantees of securities based on or 
     backed by mortgages insured under this section, not exceeding 
     $300,000,000,000. The amount of authority provided under the 
     preceding sentence to enter into new commitments to issue 
     guarantees is in addition to any amount of authority to make 
     new commitments to issue guarantees that is provided to the 
     Association under any other provision of law.
       ``(r) Sunset.--The Secretary may not enter into any new 
     commitment to insure any refinanced eligible mortgage, or 
     newly insure any refinanced eligible mortgage pursuant to 
     this section before October 1, 2008 or after September 30, 
     2011.
       ``(s) Definitions.--For purposes of this section, the 
     following definitions shall apply:
       ``(1) Approved financial institution or mortgagee.--The 
     term `approved financial institution or mortgagee' means a 
     financial institution or mortgagee approved by the Secretary 
     under section 203 as responsible and able to service 
     mortgages responsibly.
       ``(2) Board.--The term `Board' means the Board of Directors 
     of the HOPE for Homeowners Program. The Board shall be 
     composed of the Secretary, the Secretary of the Treasury, the 
     Chairperson of the Board of Governors of the Federal Reserve 
     System, and the Chairperson of the Board of Directors of the 
     Federal Deposit Insurance Corporation.
       ``(3) Eligible mortgage.--The term `eligible mortgage' 
     means a mortgage--

[[Page S6075]]

       ``(A) the mortgagor of which--
       ``(i) occupies such property as his or her principal 
     residence; and
       ``(ii) cannot, subject to subsection (e)(1)(B) and such 
     other standards established by the Board, afford his or her 
     mortgage payments; and
       ``(B) originated on or before January 1, 2008.
       ``(4) Existing senior mortgage.--The term `existing senior 
     mortgage' means, with respect to a mortgage insured under 
     this section, the existing mortgage that has superior 
     priority.
       ``(5) Existing subordinate mortgage.--The term `existing 
     subordinate mortgage' means, with respect to a mortgage 
     insured under this section, an existing mortgage that has 
     subordinate priority to the existing senior mortgage.
       ``(6) HOPE for homeowners program.--The term `HOPE for 
     Homeowners Program' means the program established under this 
     section.
       ``(7) Secretary.--The term `Secretary' means the Secretary 
     of Housing and Urban Development, except where specifically 
     provided otherwise.
       ``(t) Requirements Related to the Board.--
       ``(1) Compensation, actual, necessary, and transportation 
     expenses.--
       ``(A) Federal employees.--A member of the Board who is an 
     officer or employee of the Federal Government shall serve 
     without additional pay (or benefits in the nature of 
     compensation) for service as a member of the Board.
       ``(B) Travel expenses.--Members of the Board shall be 
     entitled to receive travel expenses, including per diem in 
     lieu of subsistence, equivalent to those set forth in 
     subchapter I of chapter 57 of title 5, United States Code.
       ``(2) Bylaws.--The Board may prescribe, amend, and repeal 
     such bylaws as may be necessary for carrying out the 
     functions of the Board.
       ``(3) Quorum.--A majority of the Board shall constitute a 
     quorum.
       ``(4) Staff; experts and consultants.--
       ``(A) Detail of government employees.--Upon request of the 
     Board, any Federal Government employee may be detailed to the 
     Board without reimbursement, and such detail shall be without 
     interruption or loss of civil service status or privilege.
       ``(B) Experts and consultants.--The Board shall procure the 
     services of experts and consultants as the Board considers 
     appropriate.
       ``(u) Rule of Construction Related to Voluntary Nature of 
     the Program.--This section shall not be construed to require 
     that any approved financial institution or mortgagee 
     participate in any activity authorized under this section, 
     including any activity related to the refinancing of an 
     eligible mortgage.
       ``(v) Rule of Construction Related to Insurance of 
     Mortgages.--Except as otherwise provided for in this section 
     or by action of the Board, the provisions and requirements of 
     section 203(b) shall apply with respect to the insurance of 
     any eligible mortgage under this section.
       ``(w) HOPE Bonds.--
       ``(1) Issuance and repayment of bonds.--Notwithstanding 
     section 504(b) of the Federal Credit Reform Act of 1990 (2 
     U.S.C. 661d(b)), the Secretary of the Treasury shall--
       ``(A) subject to such terms and conditions as the Secretary 
     of the Treasury deems necessary, issue Federal credit 
     instruments, to be known as `HOPE Bonds', that are callable 
     at the discretion of the Secretary of the Treasury and do 
     not, in the aggregate, exceed the amount specified in 
     subsection (m);
       ``(B) provide the subsidy amounts necessary for loan 
     guarantees under the HOPE for Homeowners Program, not to 
     exceed the amount specified in subsection (m), in accordance 
     with the provisions of the Federal Credit Reform Act of 1990 
     (2 U.S.C. 661 et seq.), except as provided in this paragraph; 
     and
       ``(C) use the proceeds from HOPE Bonds only to pay for the 
     net costs to the Federal Government of the HOPE for 
     Homeowners Program, including administrative costs.
       ``(2) Reimbursements to treasury.--Funds received pursuant 
     to section 1338(b) of the Federal Housing Enterprises 
     Regulatory Reform Act of 1992 shall be used to reimburse the 
     Secretary of the Treasury for amounts borrowed under 
     paragraph (1).
       ``(3) Use of reserve fund.--If the net cost to the Federal 
     Government for the HOPE for Homeowners Program exceeds the 
     amount of funds received under paragraph (2), remaining debts 
     of the HOPE for Homeowners Program shall be paid from amounts 
     deposited into the fund established by the Secretary under 
     section 1337(b) of the Federal Housing Enterprises Financial 
     Safety and Soundness Act of 1992, remaining amounts in such 
     fund to be used to reduce the National debt.''.
                                 ______
                                 
  SA 5048. Mr. ENSIGN submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 133, between lines 9 and 10, insert the following:
       ``(g) Additional Limitations on Distribution of Funds.--
       ``(1) In general.--None of the funds allocated under this 
     section shall be distributed out of either the Housing Trust 
     Fund or the Capital Magnet Fund to--
       ``(A) an organization which has been indicted for a 
     violation under Federal law relating to an election for 
     Federal office; or
       ``(B) an organization which employs applicable individuals.
       ``(2) Applicable individuals defined.--In this subsection, 
     the term `applicable individual' means an individual who--
       ``(A) is--
       ``(i) employed by the organization in a permanent or 
     temporary capacity;
       ``(ii) contracted or retained by the organization; or
       ``(iii) acting on behalf of, or with the express or 
     apparent authority of, the organization; and
       ``(B) has been indicted for a violation under Federal law 
     relating to an election for Federal office.''.
                                 ______
                                 
  SA 5049. Mr. ENSIGN submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 401, line 10, after the first period insert the 
     following:
       ``(x) No Benefit for Delinquency Within First Six Months.--
     No insurance benefits shall be paid by the Secretary pursuant 
     to this section if a mortgagor fails to timely make any of 
     his or her first six payments on a refinanced eligible 
     mortgage insured under this section.''.
                                 ______
                                 
  SA 5050. Mr. ENSIGN submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 510, between lines 5 and 6, insert the following:
       (4) Sale requirement.--If a State or unit of general local 
     government purchases or otherwise acquires an abandoned or 
     foreclosed upon home or residential property with funds 
     received pursuant to this section or with any amounts derived 
     or generated from activities authorized under this section, 
     that State or unit of general local government shall sell 
     such home or property by a date that is not later than 5 
     years after the date of enactment of this Act.
                                 ______
                                 
  SA 5051. Mr. ENSIGN submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 575, strike lines 3 through 13 and insert the 
     following:
       ``(A) Increase for 2008.--
       ``(i) In general.--In the case of calendar year 2008, the 
     State ceiling for each State shall be increased by an amount 
     equal to $11,000,000,000 multiplied by the State share for 
     such State.
       ``(ii) State share.--For purposes of this paragraph, the 
     State share for any state

[[Page S6076]]

     shall be the amount, expressed as a percentage, determined 
     with respect to such State under the formula established 
     under clause (iii).
       ``(iii) Formula.--The formula established under this clause 
     shall be established by the Secretary, in consultation with 
     the Secretary of Housing and Urban Development, and shall be 
     based on need, as such need is determined in the discretion 
     of the Secretary, taking into account--

       ``(I) the number and percentage of home foreclosures in 
     each State;
       ``(II) the number and percentage of homes financed by a 
     subprime mortgage related loan in each State; and
       ``(III) the number and percentage of homes in default or 
     delinquency in each State.

       ``(iv) Formula to be devised swiftly.--The formula under 
     clause (iii) shall be established not later than 30 days 
     after the date of enactment of this paragraph.
                                 ______
                                 
  SA 5052. Mr. ENSIGN submitted an amendment intended to be proposed by 
him to the bill H.R. 3221, moving the United States toward greater 
energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       On page 518, line 3, strike the period and insert ``:  
     Provided, further that none of the funds appropriated by this 
     section for section 2401 or funds appropriated by section 
     2401 shall be for political activities, lobbying, whether 
     directly or through other parties, or travel expenses.''.
                                 ______
                                 
  SA 5053 Mr. CORKER submitted an amendment intended to be proposed by 
him to the bill H.R. 3221, moving the United States toward greater 
energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       Strike Title III of Division B.
                                 ______
                                 
  SA 5054. Mr. ENSIGN submitted an amendment intended to be proposed to 
amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself and 
Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       At the end of division C, add the following:

                  TITLE __--CLEAN ENERGY TAX STIMULUS

     SEC. __01. SHORT TITLE.

       This title may be cited as the ``Clean Energy Tax Stimulus 
     Act of 2008''.

      Subtitle A--Extension of Clean Energy Production Incentives

     SEC. __11. EXTENSION AND MODIFICATION OF RENEWABLE ENERGY 
                   PRODUCTION TAX CREDIT.

       (a) Extension of Credit.--Each of the following provisions 
     of section 45(d) (relating to qualified facilities) is 
     amended by striking ``January 1, 2009'' and inserting 
     ``January 1, 2010'':
       (1) Paragraph (1).
       (2) Clauses (i) and (ii) of paragraph (2)(A).
       (3) Clauses (i)(I) and (ii) of paragraph (3)(A).
       (4) Paragraph (4).
       (5) Paragraph (5).
       (6) Paragraph (6).
       (7) Paragraph (7).
       (8) Paragraph (8).
       (9) Subparagraphs (A) and (B) of paragraph (9).
       (b) Production Credit for Electricity Produced From Marine 
     Renewables.--
       (1) In general.--Paragraph (1) of section 45(c) (relating 
     to resources) is amended by striking ``and'' at the end of 
     subparagraph (G), by striking the period at the end of 
     subparagraph (H) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(I) marine and hydrokinetic renewable energy.''.
       (2) Marine renewables.--Subsection (c) of section 45 is 
     amended by adding at the end the following new paragraph:
       ``(10) Marine and hydrokinetic renewable energy.--
       ``(A) In general.--The term `marine and hydrokinetic 
     renewable energy' means energy derived from--
       ``(i) waves, tides, and currents in oceans, estuaries, and 
     tidal areas,
       ``(ii) free flowing water in rivers, lakes, and streams,
       ``(iii) free flowing water in an irrigation system, canal, 
     or other man-made channel, including projects that utilize 
     nonmechanical structures to accelerate the flow of water for 
     electric power production purposes, or
       ``(iv) differentials in ocean temperature (ocean thermal 
     energy conversion).
       ``(B) Exceptions.--Such term shall not include any energy 
     which is derived from any source which utilizes a dam, 
     diversionary structure (except as provided in subparagraph 
     (A)(iii)), or impoundment for electric power production 
     purposes.''.
       (3) Definition of facility.--Subsection (d) of section 45 
     is amended by adding at the end the following new paragraph:
       ``(11) Marine and hydrokinetic renewable energy 
     facilities.--In the case of a facility producing electricity 
     from marine and hydrokinetic renewable energy, the term 
     `qualified facility' means any facility owned by the 
     taxpayer--
       ``(A) which has a nameplate capacity rating of at least 150 
     kilowatts, and
       ``(B) which is originally placed in service on or after the 
     date of the enactment of this paragraph and before January 1, 
     2010.''.
       (4) Credit rate.--Subparagraph (A) of section 45(b)(4) is 
     amended by striking ``or (9)'' and inserting ``(9), or 
     (11)''.
       (5) Coordination with small irrigation power.--Paragraph 
     (5) of section 45(d), as amended by subsection (a), is 
     amended by striking ``January 1, 2010'' and inserting ``the 
     date of the enactment of paragraph (11)''.
       (c) Sales of Electricity to Regulated Public Utilities 
     Treated as Sales to Unrelated Persons.--Section 45(e)(4) 
     (relating to related persons) is amended by adding at the end 
     the following new sentence: ``A taxpayer shall be treated as 
     selling electricity to an unrelated person if such 
     electricity is sold to a regulated public utility (as defined 
     in section 7701(a)(33).''.
       (d) Trash Facility Clarification.--Paragraph (7) of section 
     45(d) is amended--
       (1) by striking ``facility which burns'' and inserting 
     ``facility (other than a facility described in paragraph (6)) 
     which uses'', and
       (2) by striking ``combustion''.
       (e) Effective Dates.--
       (1) Extension.--The amendments made by subsection (a) shall 
     apply to property originally placed in service after December 
     31, 2008.
       (2) Modifications.--The amendments made by subsections (b) 
     and (c) shall apply to electricity produced and sold after 
     the date of the enactment of this Act, in taxable years 
     ending after such date.
       (3) Trash facility clarification.--The amendments made by 
     subsection (d) shall apply to electricity produced and sold 
     before, on, or after December 31, 2007.

     SEC. __12. EXTENSION AND MODIFICATION OF SOLAR ENERGY AND 
                   FUEL CELL INVESTMENT TAX CREDIT.

       (a) Extension of Credit.--
       (1) Solar energy property.--Paragraphs (2)(A)(i)(II) and 
     (3)(A)(ii) of section 48(a) (relating to energy credit) are 
     each amended by striking ``January 1, 2009'' and inserting 
     ``January 1, 2017''.
       (2) Fuel cell property.--Subparagraph (E) of section 
     48(c)(1) (relating to qualified fuel cell property) is 
     amended by striking ``December 31, 2008'' and inserting 
     ``December 31, 2017''.
       (3) Qualified microturbine property.--Subparagraph (E) of 
     section 48(c)(2) (relating to qualified microturbine 
     property) is amended by striking ``December 31, 2008'' and 
     inserting ``December 31, 2017''.
       (b) Allowance of Energy Credit Against Alternative Minimum 
     Tax.--Subparagraph (B) of section 38(c)(4) (relating to 
     specified credits) is amended by striking ``and'' at the end 
     of clause (iii), by striking the period at the end of clause 
     (iv) and inserting ``, and'', and by adding at the end the 
     following new clause:
       ``(v) the credit determined under section 46 to the extent 
     that such credit is attributable to the energy credit 
     determined under section 48.''.
       (c) Repeal of Dollar Per Kilowatt Limitation for Fuel Cell 
     Property.--
       (1) In general.--Section 48(c)(1) (relating to qualified 
     fuel cell), as amended by subsection (a)(2), is amended by 
     striking subparagraph (B) and by redesignating subparagraphs 
     (C), (D), and (E) as subparagraphs (B), (C), and (D), 
     respectively.
       (2) Conforming amendment.--Section 48(a)(1) is amended by 
     striking ``paragraphs (1)(B) and (2)(B) of subsection (c)'' 
     and inserting ``subsection (c)(2)(B)''.
       (d) Public Electric Utility Property Taken Into Account.--
       (1) In general.--Paragraph (3) of section 48(a) is amended 
     by striking the second sentence thereof.
       (2) Conforming amendments.--
       (A) Paragraph (1) of section 48(c), as amended by this 
     section, is amended by striking subparagraph (C) and 
     redesignating subparagraph (D) as subparagraph (C).
       (B) Paragraph (2) of section 48(c), as amended by 
     subsection (a)(3), is amended by striking subparagraph (D) 
     and redesignating subparagraph (E) as subparagraph (D).
       (e) Effective Dates.--
       (1) Extension.--The amendments made by subsection (a) shall 
     take effect on the date of the enactment of this Act.

[[Page S6077]]

       (2) Allowance against alternative minimum tax.--The 
     amendments made by subsection (b) shall apply to credits 
     determined under section 46 of the Internal Revenue Code of 
     1986 in taxable years beginning after the date of the 
     enactment of this Act and to carrybacks of such credits.
       (3) Fuel cell property and public electric utility 
     property.--The amendments made by subsections (c) and (d) 
     shall apply to periods after the date of the enactment of 
     this Act, in taxable years ending after such date, under 
     rules similar to the rules of section 48(m) of the Internal 
     Revenue Code of 1986 (as in effect on the day before the date 
     of the enactment of the Revenue Reconciliation Act of 1990).

     SEC. __13. EXTENSION AND MODIFICATION OF RESIDENTIAL ENERGY 
                   EFFICIENT PROPERTY CREDIT.

       (a) Extension.--Section 25D(g) (relating to termination) is 
     amended by striking ``December 31, 2008'' and inserting 
     ``December 31, 2009''.
       (b) No Dollar Limitation for Credit for Solar Electric 
     Property.--
       (1) In general.--Section 25D(b)(1) (relating to maximum 
     credit) is amended by striking subparagraph (A) and by 
     redesignating subparagraphs (B) and (C) as subparagraphs (A) 
     and (B), respectively.
       (2) Conforming amendments.--Section 25D(e)(4) is amended--
       (A) by striking clause (i) in subparagraph (A),
       (B) by redesignating clauses (ii) and (iii) in subparagraph 
     (A) as clauses (i) and (ii), respectively, and
       (C) by striking ``, (2),'' in subparagraph (C).
       (c) Credit Allowed Against Alternative Minimum Tax.--
       (1) In general.--Subsection (c) of section 25D is amended 
     to read as follows:
       ``(c) Limitation Based on Amount of Tax; Carryforward of 
     Unused Credit.--
       ``(1) Limitation based on amount of tax.--In the case of a 
     taxable year to which section 26(a)(2) does not apply, the 
     credit allowed under subsection (a) for the taxable year 
     shall not exceed the excess of--
       ``(A) the sum of the regular tax liability (as defined in 
     section 26(b)) plus the tax imposed by section 55, over
       ``(B) the sum of the credits allowable under this subpart 
     (other than this section) and section 27 for the taxable 
     year.
       ``(2) Carryforward of unused credit.--
       ``(A) Rule for years in which all personal credits allowed 
     against regular and alternative minimum tax.--In the case of 
     a taxable year to which section 26(a)(2) applies, if the 
     credit allowable under subsection (a) exceeds the limitation 
     imposed by section 26(a)(2) for such taxable year reduced by 
     the sum of the credits allowable under this subpart (other 
     than this section), such excess shall be carried to the 
     succeeding taxable year and added to the credit allowable 
     under subsection (a) for such succeeding taxable year.
       ``(B) Rule for other years.--In the case of a taxable year 
     to which section 26(a)(2) does not apply, if the credit 
     allowable under subsection (a) exceeds the limitation imposed 
     by paragraph (1) for such taxable year, such excess shall be 
     carried to the succeeding taxable year and added to the 
     credit allowable under subsection (a) for such succeeding 
     taxable year.''.
       (2) Conforming amendments.--
       (A) Section 23(b)(4)(B) is amended by inserting ``and 
     section 25D'' after ``this section''.
       (B) Section 24(b)(3)(B) is amended by striking ``and 25B'' 
     and inserting ``, 25B, and 25D''.
       (C) Section 25B(g)(2) is amended by striking ``section 23'' 
     and inserting ``sections 23 and 25D''.
       (D) Section 26(a)(1) is amended by striking ``and 25B'' and 
     inserting ``25B, and 25D''.
       (d) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     apply to taxable years beginning after December 31, 2007.
       (2) Application of egtrra sunset.--The amendments made by 
     subparagraphs (A) and (B) of subsection (c)(2) shall be 
     subject to title IX of the Economic Growth and Tax Relief 
     Reconciliation Act of 2001 in the same manner as the 
     provisions of such Act to which such amendments relate.

     SEC. __14. EXTENSION AND MODIFICATION OF CREDIT FOR CLEAN 
                   RENEWABLE ENERGY BONDS.

       (a) Extension.--Section 54(m) (relating to termination) is 
     amended by striking ``December 31, 2008'' and inserting 
     ``December 31, 2009''.
       (b) Increase in National Limitation.--Section 54(f) 
     (relating to limitation on amount of bonds designated) is 
     amended--
       (1) by inserting ``, and for the period beginning after the 
     date of the enactment of the Clean Energy Tax Stimulus Act of 
     2008 and ending before January 1, 2010, $400,000,000'' after 
     ``$1,200,000,000'' in paragraph (1),
       (2) by striking ``$750,000,000 of the'' in paragraph (2) 
     and inserting ``$750,000,000 of the $1,200,000,000'', and
       (3) by striking ``bodies'' in paragraph (2) and inserting 
     ``bodies, and except that the Secretary may not allocate more 
     than \1/3\ of the $400,000,000 national clean renewable 
     energy bond limitation to finance qualified projects of 
     qualified borrowers which are public power providers nor more 
     than \1/3\ of such limitation to finance qualified projects 
     of qualified borrowers which are mutual or cooperative 
     electric companies described in section 501(c)(12) or section 
     1381(a)(2)(C)''.
       (c) Public Power Providers Defined.--Section 54(j) is 
     amended--
       (1) by adding at the end the following new paragraph:
       ``(6) Public power provider.--The term `public power 
     provider' means a State utility with a service obligation, as 
     such terms are defined in section 217 of the Federal Power 
     Act (as in effect on the date of the enactment of this 
     paragraph).'', and
       (2) by inserting ``; Public Power Provider'' before the 
     period at the end of the heading.
       (d) Technical Amendment.--The third sentence of section 
     54(e)(2) is amended by striking ``subsection (l)(6)'' and 
     inserting ``subsection (l)(5)''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to bonds issued after the date of the enactment 
     of this Act.

     SEC. __15. EXTENSION OF SPECIAL RULE TO IMPLEMENT FERC 
                   RESTRUCTURING POLICY.

       (a) Qualifying Electric Transmission Transaction.--
       (1) In general.--Section 451(i)(3) (defining qualifying 
     electric transmission transaction) is amended by striking 
     ``January 1, 2008'' and inserting ``January 1, 2010''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply to transactions after December 31, 2007.
       (b) Independent Transmission Company.--
       (1) In general.--Section 451(i)(4)(B)(ii) (defining 
     independent transmission company) is amended by striking 
     ``December 31, 2007'' and inserting ``the date which is 2 
     years after the date of such transaction''.
       (2) Effective date.--The amendment made by this subsection 
     shall take effect as if included in the amendments made by 
     section 909 of the American Jobs Creation Act of 2004.

    Subtitle B--Extension of Incentives To Improve Energy Efficiency

     SEC. __21. EXTENSION AND MODIFICATION OF CREDIT FOR ENERGY 
                   EFFICIENCY IMPROVEMENTS TO EXISTING HOMES.

       (a) Extension of Credit.--Section 25C(g) (relating to 
     termination) is amended by striking ``December 31, 2007'' and 
     inserting ``December 31, 2009''.
       (b) Qualified Biomass Fuel Property.--
       (1) In general.--Section 25C(d)(3) is amended--
       (A) by striking ``and'' at the end of subparagraph (D),
       (B) by striking the period at the end of subparagraph (E) 
     and inserting ``, and'', and
       (C) by adding at the end the following new subparagraph:
       ``(F) a stove which uses the burning of biomass fuel to 
     heat a dwelling unit located in the United States and used as 
     a residence by the taxpayer, or to heat water for use in such 
     a dwelling unit, and which has a thermal efficiency rating of 
     at least 75 percent.''.
       (2) Biomass fuel.--Section 25C(d) (relating to residential 
     energy property expenditures) is amended by adding at the end 
     the following new paragraph:
       ``(6) Biomass fuel.--The term `biomass fuel' means any 
     plant-derived fuel available on a renewable or recurring 
     basis, including agricultural crops and trees, wood and wood 
     waste and residues (including wood pellets), plants 
     (including aquatic plants), grasses, residues, and fibers.''.
       (c) Modifications of Standards for Energy-Efficient 
     Building Property.--
       (1) Electric heat pumps.--Subparagraph (B) of section 
     25C(d)(3) is amended to read as follows:
       ``(A) an electric heat pump which achieves the highest 
     efficiency tier established by the Consortium for Energy 
     Efficiency, as in effect on January 1, 2008.''.
       (2) Central air conditioners.--Section 25C(d)(3)(D) is 
     amended by striking ``2006'' and inserting ``2008''.
       (3) Water heaters.--Subparagraph (E) of section 25C(d) is 
     amended to read as follows:
       ``(E) a natural gas, propane, or oil water heater which has 
     either an energy factor of at least 0.80 or a thermal 
     efficiency of at least 90 percent.''.
       (4) Oil furnaces and hot water boilers.--Paragraph (4) of 
     section 25C(d) is amended to read as follows:
       ``(4) Qualified natural gas, propane, and oil furnaces and 
     hot water boilers.--
       ``(A) Qualified natural gas furnace.--The term `qualified 
     natural gas furnace' means any natural gas furnace which 
     achieves an annual fuel utilization efficiency rate of not 
     less than 95.
       ``(B) Qualified natural gas hot water boiler.--The term 
     `qualified natural gas hot water boiler' means any natural 
     gas hot water boiler which achieves an annual fuel 
     utilization efficiency rate of not less than 90.
       ``(C) Qualified propane furnace.--The term `qualified 
     propane furnace' means any propane furnace which achieves an 
     annual fuel utilization efficiency rate of not less than 95.
       ``(D) Qualified propane hot water boiler.--The term 
     `qualified propane hot water boiler' means any propane hot 
     water boiler which achieves an annual fuel utilization 
     efficiency rate of not less than 90.
       ``(E) Qualified oil furnaces.--The term `qualified oil 
     furnace' means any oil furnace which achieves an annual fuel 
     utilization efficiency rate of not less than 90.
       ``(F) Qualified oil hot water boiler.--The term `qualified 
     oil hot water boiler' means any oil hot water boiler which 
     achieves an annual fuel utilization efficiency rate of not 
     less than 90.''.

[[Page S6078]]

       (d) Effective Date.--The amendments made this section shall 
     apply to expenditures made after December 31, 2007.

     SEC. __22. EXTENSION AND MODIFICATION OF TAX CREDIT FOR 
                   ENERGY EFFICIENT NEW HOMES.

       (a) Extension of Credit.--Subsection (g) of section 45L 
     (relating to termination) is amended by striking ``December 
     31, 2008'' and inserting ``December 31, 2010''.
       (b) Allowance for Contractor's Personal Residence.--
     Subparagraph (B) of section 45L(a)(1) is amended to read as 
     follows:
       ``(B)(i) acquired by a person from such eligible contractor 
     and used by any person as a residence during the taxable 
     year, or
       ``(ii) used by such eligible contractor as a residence 
     during the taxable year.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to homes acquired after December 31, 2008.

     SEC. __23. EXTENSION AND MODIFICATION OF ENERGY EFFICIENT 
                   COMMERCIAL BUILDINGS DEDUCTION.

       (a) Extension.--Section 179D(h) (relating to termination) 
     is amended by striking ``December 31, 2008'' and inserting 
     ``December 31, 2009''.
       (b) Adjustment of Maximum Deduction Amount.--
       (1) In general.--Subparagraph (A) of section 179D(b)(1) 
     (relating to maximum amount of deduction) is amended by 
     striking ``$1.80'' and inserting ``$2.25''.
       (2) Partial allowance.--Paragraph (1) of section 179D(d) is 
     amended--
       (A) by striking ``$.60'' and inserting ``$0.75'', and
       (B) by striking ``$1.80'' and inserting ``$2.25''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after the date of 
     the enactment of this Act.

     SEC. __24. MODIFICATION AND EXTENSION OF ENERGY EFFICIENT 
                   APPLIANCE CREDIT FOR APPLIANCES PRODUCED AFTER 
                   2007.

       (a) In General.--Subsection (b) of section 45M (relating to 
     applicable amount) is amended to read as follows:
       ``(b) Applicable Amount.--For purposes of subsection (a)--
       ``(1) Dishwashers.--The applicable amount is--
       ``(A) $45 in the case of a dishwasher which is manufactured 
     in calendar year 2008 or 2009 and which uses no more than 324 
     kilowatt hours per year and 5.8 gallons per cycle, and
       ``(B) $75 in the case of a dishwasher which is manufactured 
     in calendar year 2008, 2009, or 2010 and which uses no more 
     than 307 kilowatt hours per year and 5.0 gallons per cycle 
     (5.5 gallons per cycle for dishwashers designed for greater 
     than 12 place settings).
       ``(2) Clothes washers.--The applicable amount is--
       ``(A) $75 in the case of a residential top-loading clothes 
     washer manufactured in calendar year 2008 which meets or 
     exceeds a 1.72 modified energy factor and does not exceed a 
     8.0 water consumption factor,
       ``(B) $125 in the case of a residential top-loading clothes 
     washer manufactured in calendar year 2008 or 2009 which meets 
     or exceeds a 1.8 modified energy factor and does not exceed a 
     7.5 water consumption factor,
       ``(C) $150 in the case of a residential or commercial 
     clothes washer manufactured in calendar year 2008, 2009, or 
     2010 which meets or exceeds 2.0 modified energy factor and 
     does not exceed a 6.0 water consumption factor, and
       ``(D) $250 in the case of a residential or commercial 
     clothes washer manufactured in calendar year 2008, 2009, or 
     2010 which meets or exceeds 2.2 modified energy factor and 
     does not exceed a 4.5 water consumption factor.
       ``(3) Refrigerators.--The applicable amount is--
       ``(A) $50 in the case of a refrigerator which is 
     manufactured in calendar year 2008, and consumes at least 20 
     percent but not more than 22.9 percent less kilowatt hours 
     per year than the 2001 energy conservation standards,
       ``(B) $75 in the case of a refrigerator which is 
     manufactured in calendar year 2008 or 2009, and consumes at 
     least 23 percent but no more than 24.9 percent less kilowatt 
     hours per year than the 2001 energy conservation standards,
       ``(C) $100 in the case of a refrigerator which is 
     manufactured in calendar year 2008, 2009, or 2010, and 
     consumes at least 25 percent but not more than 29.9 percent 
     less kilowatt hours per year than the 2001 energy 
     conservation standards, and
       ``(D) $200 in the case of a refrigerator manufactured in 
     calendar year 2008, 2009, or 2010 and which consumes at least 
     30 percent less energy than the 2001 energy conservation 
     standards.''.
       (b) Eligible Production.--
       (1) Similar treatment for all appliances.--Subsection (c) 
     of section 45M (relating to eligible production) is amended--
       (A) by striking paragraph (2),
       (B) by striking ``(1) In general'' and all that follows 
     through ``the eligible'' and inserting ``The eligible'', and
       (C) by moving the text of such subsection in line with the 
     subsection heading and redesignating subparagraphs (A) and 
     (B) as paragraphs (1) and (2), respectively.
       (2) Modification of base period.--Paragraph (2) of section 
     45M(c), as amended by paragraph (1) of this section, is 
     amended by striking ``3-calendar year'' and inserting ``2-
     calendar year''.
       (c) Types of Energy Efficient Appliances.--Subsection (d) 
     of section 45M (defining types of energy efficient 
     appliances) is amended to read as follows:
       ``(d) Types of Energy Efficient Appliance.--For purposes of 
     this section, the types of energy efficient appliances are--
       ``(1) dishwashers described in subsection (b)(1),
       ``(2) clothes washers described in subsection (b)(2), and
       ``(3) refrigerators described in subsection (b)(3).''.
       (d) Aggregate Credit Amount Allowed.--
       (1) Increase in limit.--Paragraph (1) of section 45M(e) 
     (relating to aggregate credit amount allowed) is amended to 
     read as follows:
       ``(1) Aggregate credit amount allowed.--The aggregate 
     amount of credit allowed under subsection (a) with respect to 
     a taxpayer for any taxable year shall not exceed $75,000,000 
     reduced by the amount of the credit allowed under subsection 
     (a) to the taxpayer (or any predecessor) for all prior 
     taxable years beginning after December 31, 2007.''.
       (2) Exception for certain refrigerator and clothes 
     washers.--Paragraph (2) of section 45M(e) is amended to read 
     as follows:
       ``(2) Amount allowed for certain refrigerators and clothes 
     washers.--Refrigerators described in subsection (b)(3)(D) and 
     clothes washers described in subsection (b)(2)(D) shall not 
     be taken into account under paragraph (1).''.
       (e) Qualified Energy Efficient Appliances.--
       (1) In general.--Paragraph (1) of section 45M(f) (defining 
     qualified energy efficient appliance) is amended to read as 
     follows:
       ``(1) Qualified energy efficient appliance.--The term 
     `qualified energy efficient appliance' means--
       ``(A) any dishwasher described in subsection (b)(1),
       ``(B) any clothes washer described in subsection (b)(2), 
     and
       ``(C) any refrigerator described in subsection (b)(3).''.
       (2) Clothes washer.--Section 45M(f)(3) (defining clothes 
     washer) is amended by inserting ``commercial'' before 
     ``residential'' the second place it appears.
       (3) Top-loading clothes washer.--Subsection (f) of section 
     45M (relating to definitions) is amended by redesignating 
     paragraphs (4), (5), (6), and (7) as paragraphs (5), (6), 
     (7), and (8), respectively, and by inserting after paragraph 
     (3) the following new paragraph:
       ``(4) Top-loading clothes washer.--The term `top-loading 
     clothes washer' means a clothes washer which has the clothes 
     container compartment access located on the top of the 
     machine and which operates on a vertical axis.''.
       (4) Replacement of energy factor.--Section 45M(f)(6), as 
     redesignated by paragraph (3), is amended to read as follows:
       ``(6) Modified energy factor.--The term `modified energy 
     factor' means the modified energy factor established by the 
     Department of Energy for compliance with the Federal energy 
     conservation standard.''.
       (5) Gallons per cycle; water consumption factor.--Section 
     45M(f) (relating to definitions), as amended by paragraph 
     (3), is amended by adding at the end the following:
       ``(9) Gallons per cycle.--The term `gallons per cycle' 
     means, with respect to a dishwasher, the amount of water, 
     expressed in gallons, required to complete a normal cycle of 
     a dishwasher.
       ``(10) Water consumption factor.--The term `water 
     consumption factor' means, with respect to a clothes washer, 
     the quotient of the total weighted per-cycle water 
     consumption divided by the cubic foot (or liter) capacity of 
     the clothes washer.''.
       (f) Effective Date.--The amendments made by this section 
     shall apply to appliances produced after December 31, 2007.
                                 ______
                                 
  SA 5055. Mrs. LINCOLN submitted an amendment intended to be proposed 
to amendment SA 4983 proposed by Mr. Reid (for Mr. Dodd (for himself 
and Mr. Shelby)) to the bill H.R. 3221, moving the United States toward 
greater energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       At the end of title VI of division A, add the following:

     SEC. 1606. CLARIFICATION OF SCOPE OF APPLICABLE RATE 
                   PROVISION.

       Section 44(f) of the Federal Deposit Insurance Act (12 
     U.S.C. 1831u(f)) is amended by adding at the end the 
     following new paragraphs:
       ``(3) Other persons.--In the case of any other person or 
     governmental or private entity in the State described in 
     paragraph (1)--
       ``(A) any provision of the constitution of that State that 
     establishes a maximum lawful annual interest rate, or 
     otherwise or limits the amount of interest, discount points, 
     finance charges, fees, or other charges that may be charged, 
     taken, paid, received, or reserved from time to time, until 
     judgment, thereby interfering in interstate commerce,

[[Page S6079]]

     shall not apply to any loan, discount, or credit sale made, 
     or upon any bond, note, obligation, bill of exchange, 
     financing transaction, or other evidence of debt issued or 
     acquired by any other person or governmental or private 
     entity; and
       ``(B) such interest, discount points, finance charges, 
     fees, or other charges that may be charged, taken, paid, 
     received, or reserved from time to time, until judgment, in 
     any loan, discount, or credit sale made, or upon any bond, 
     note, obligation, bill of exchange, financing transaction, or 
     other evidence of debt issued to or acquired by any other 
     person or governmental or private entity may not exceed 17 
     percent per year.''.
                                 ______
                                 
  SA 5056. Mr. DeMINT submitted an amendment intended to be proposed by 
him to the bill H.R. 3221, moving the United States toward greater 
energy independence and security, developing innovative new 
technologies, reducing carbon emissions, creating green jobs, 
protecting consumers, increasing clean renewable energy production, and 
modernizing our energy infrastructure, and to amend the Internal 
Revenue Code of 1986 to provide tax incentives for the production of 
renewable energy and energy conservation; which was ordered to lie on 
the table; as follows:

       At the end of title VI of division A, add the following:

     SEC. 1606. OIL AND NATURAL GAS LEASING IN NEW PRODUCING 
                   AREAS.

       (a) Definitions.--In this section:
       (1) Eligible producing state.--The term ``eligible 
     producing State'' means--
       (A) a new producing State; and
       (B) any other producing State that has, within the offshore 
     administrative boundaries beyond the submerged land of a 
     State, areas available for oil leasing, natural gas leasing, 
     or both.
       (2) New producing area.--The term ``new producing area'' 
     means an area that is--
       (A) within the offshore administrative boundaries beyond 
     the submerged land of a State; and
       (B) not available for oil or natural gas leasing as of the 
     date of enactment of this Act.
       (3) New producing state.--The term ``new producing State'' 
     means a State with respect to which a petition has been 
     approved by the Secretary under subsection (b).
       (4) Qualified revenues.--The term ``qualified revenues'' 
     means all rentals, royalties, bonus bids, and other sums due 
     and payable to the United States from leases entered into on 
     or after the date of enactment of this Act for new producing 
     areas.
       (5) Secretary.--The term ``Secretary'' means the Secretary 
     of the Interior.
       (b) Petition for Leasing New Producing Areas.--
       (1) In general.--Notwithstanding any other provision of 
     law, the Governor of a State, with the concurrence of the 
     State legislature, may submit to the Secretary a petition 
     requesting that the Secretary make a new producing area of 
     the State eligible for oil leasing, gas leasing, or both, as 
     determined by the State, in accordance with the Outer 
     Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) and the 
     Mineral Leasing Act (30 U.S.C. 181 et seq.).
       (2) Action by secretary.--As soon as practicable after the 
     date on which the Secretary receives a petition under 
     paragraph (1), the Secretary shall approve or disapprove the 
     petition.
       (c) Disposition of Qualified Outer Continental Shelf 
     Revenues From Eligible Producing States.--Notwithstanding 
     section 9 of the Outer Continental Shelf Lands Act (43 U.S.C. 
     1338), for each applicable fiscal year, the Secretary of the 
     Treasury shall deposit--
       (1) 50 percent of qualified revenues in the general fund of 
     the Treasury; and
       (2) 50 percent of qualified revenues in a special account 
     in the Treasury, which the Secretary shall disburse to 
     eligible producing States for new producing areas, to be 
     allocated in accordance with subsection (d)(1).
       (d) Allocation to Eligible Producing States.--
       (1) In general.--The amount made available under subsection 
     (c)(2)(A) shall be allocated to eligible producing States in 
     amounts (based on a formula established by the Secretary by 
     regulation) that are inversely proportional to the respective 
     distances between the point on the coastline of each eligible 
     producing State that is closest to the geographic center of 
     the applicable leased tract and the geographic center of the 
     leased tract, as determined by the Secretary.
       (2) Use.--Amounts allocated to an eligible producing State 
     under paragraph (1) shall be used to address the impacts of 
     any oil and natural gas exploration and production activities 
     under this section.
       (e) Effect.--Nothing in this section affects--
       (1) the amount of funds otherwise dedicated to the land and 
     water conservation fund established under section 2 of the 
     Land and Water Conservation Fund Act of 1965 (16 U.S.C. 460l-
     5); or
       (2) any authority that permits energy production under any 
     other provision of law.

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