Let the GSEs Pay Us Back Act of 2017

Let the GSEs Pay Us Back Act of 2017

This bill provides for the repayment of amounts previously borrowed by government-sponsored enterprises (GSEs) from the Department of the Treasury. GSEs are financial services corporations created by Congress and include the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac).

Under an existing Preferred Stock Purchase Agreement, net income from the GSEs is directed to Treasury as a dividend but is not counted toward repayment of the GSEs' debt. The bill requires this agreement to be modified such that: (1) the amounts previously borrowed by the GSEs from Treasury shall be treated as a loan, in accordance with specified terms; and (2) payments made under the agreement by the GSEs to Treasury, including payments made prior to the agreement's modification, shall be treated as payments of principal and interest under such loan.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 491 Introduced in House (IH)]

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115th CONGRESS
  1st Session
                                H. R. 491

  To provide for the repayment of amounts borrowed by Fannie Mae and 
   Freddie Mac from the Treasury of the United States, together with 
        interest, over a 30-year period, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 12, 2017

 Mr. Capuano introduced the following bill; which was referred to the 
                    Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
  To provide for the repayment of amounts borrowed by Fannie Mae and 
   Freddie Mac from the Treasury of the United States, together with 
        interest, over a 30-year period, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Let the GSEs Pay Us Back Act of 
2017''.

SEC. 2. REPAYMENT OF TREASURY BORROWING.

    The Secretary of the Treasury and each enterprise (acting through 
the conservator for the enterprise appointed pursuant to section 1367 
of the Federal Housing Enterprises Financial Safety and Soundness Act 
of 1992 (12 U.S.C. 4617)) shall enter into an agreement that modifies 
the Preferred Stock Purchase Agreement for such enterprise to provide 
as follows:
            (1) Termination of dividends.--That after such 
        modification, any Senior Preferred Stock purchased under such 
        Agreement by the Department of the Treasury shall not accrue 
        further dividends.
            (2) Treatment of enterprise draws on treasury.--That any 
        amounts received, before or after such modification, during a 
        single year by the enterprise as a draw on the commitment made 
        by the Department of the Treasury under such an Agreement, 
        shall be treated as a loan made by the Treasury to the 
        enterprise that--
                    (A) was originated on the date of the last such 
                draw during such year;
                    (B) has an original principal obligation in an 
                amount equal to the aggregate amount of such draws;
                    (C) has a term to maturity of 30 years;
                    (D) has an annual interest rate of 5 percent for 
                the entire term of the loan;
                    (E) has terms that provide for full amortization of 
                the loan over such term to maturity; and
                    (F) shall be repaid by the enterprise in accordance 
                with the amortization schedule established for the loan 
                pursuant to subparagraph (E) of this paragraph, subject 
                to paragraph (3).
            (3) Treatment of dividends paid.--That any dividends paid 
        by the enterprise to the Department of the Treasury under the 
        Senior Preferred Stock Agreement before such modification of 
        such Agreement shall be treated as payments of principal and 
        interest due under the loan referred to in paragraph (2), and 
        shall be credited against payments due under the terms of such 
        loan (in accordance with the amortization schedule established 
        for such loan pursuant to paragraph (2)(E)), first to such loan 
        having the earliest origination date that has not yet been 
        fully repaid until such loan is repaid, and then to the next 
        such loan having the next earliest origination date until such 
        loan is repaid.

SEC. 3. DEFINITIONS.

    For purposes of this Act, the following definitions shall apply:
            (1) Enterprise.--The term ``enterprise'' has the meaning 
        given such term in section 1303 of the Federal Housing 
        Enterprises Financial Safety and Soundness Act of 1992 (12 
        U.S.C. 4502).
            (2) Preferred stock purchase agreement.--The term 
        ``Preferred Stock Purchase Agreement'' means, with respect to 
        an enterprise, the Amended and Restated Senior Preferred Stock 
        Purchase Agreements, dated September 26, 2008, amended May 6, 
        2009, further amended December 24, 2009, and further amended 
        December 24, 2009 (as such agreements may be further amended), 
        between the United States Department of the Treasury and such 
        enterprise.
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