Prohibits the use of federal funds to purchase or guarantee obligations of, issue lines of credit to or provide direct or indirect grants-and-aid to, any state, municipal, local, or county government which a nationally recognized statistical rating organization has determined has defaulted on its obligations or is likely to default, without such federal assistance.
Prohibits the Secretary of the Treasury from using, directly or indirectly, general fund revenues or borrowed funds to purchase or guarantee any asset or obligation of any such state, municipal, local, or county government.
Prohibits the Board of Governors of the Federal Reserve System from directly or indirectly lending against, purchasing, or guaranteeing any asset or obligation of such a state, municipal, local, or county government.
[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 184 Introduced in Senate (IS)]
112th CONGRESS
1st Session
S. 184
To prohibit taxpayer bailouts of fiscally irresponsible State and local
governments.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
January 25 (legislative day, January 5), 2011
Mr. Ensign introduced the following bill; which was read twice and
referred to the Committee on Banking, Housing, and Urban Affairs
_______________________________________________________________________
A BILL
To prohibit taxpayer bailouts of fiscally irresponsible State and local
governments.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. PROHIBITION ON THE USE OF FEDERAL FUNDS TO PAY STATE
OBLIGATIONS.
Notwithstanding any other provision of law, no Federal funds may be
used to purchase or guarantee obligations of, issue lines of credit to
or provide direct or indirect grants-and-aid to, any State government,
municipal government, local government, or county government which a
nationally recognized statistical rating organization has determined
has defaulted on its obligations or is likely to default, absent such
assistance from the United States Government.
SEC. 2. LIMIT ON USE OF BORROWED FUNDS.
The Secretary shall not, directly or indirectly, use general fund
revenues or funds borrowed pursuant to title 31, United States Code, to
purchase or guarantee any asset or obligation of any State government,
municipal government, local government, or county government or to
otherwise assist such governments, in any instance in which a
nationally recognized statistical rating organization has determined
that the State government, municipal government, local government, or
county government has defaulted on its obligations or is likely to
default, absent such assistance from the United States Government.
SEC. 3. LIMIT ON FEDERAL RESERVE FUNDS.
The Board of Governors of the Federal Reserve System shall not,
directly or indirectly, lend against, purchase, or guarantee any asset
or obligation of any State government, municipal government, local
government, or county government or to otherwise assist such
governments, in any instance in which a nationally recognized
statistical rating organization has determined that the State
government, municipal government, local government, or county
government has defaulted on its obligations or is likely to default,
absent such assistance from the United States Government.
<all>
Introduced in Senate
Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
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