PUBLIC LAW 112–78—DEC. 23, 2011 

TEMPORARY PAYROLL TAX CUT 

CONTINUATION ACT OF 2011 


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125 STAT. 1280 PUBLIC LAW 112–78—DEC. 23, 2011 

Public Law 112–78 

112th Congress 

An Act 

To extend the payroll tax holiday, unemployment compensation, Medicare physician 

payment, provide for the consideration of the Keystone XL pipeline, 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; TABLE OF CONTENTS. 

(a) SHORT TITLE.—This Act may be cited as the ‘‘Temporary 

Payroll Tax Cut Continuation Act of 2011’’. 

(b) TABLE OF CONTENTS.—The table of contents of this Act 

is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—TEMPORARY PAYROLL TAX RELIEF 

Sec. 101. Extension of payroll tax holiday. 

TITLE II—TEMPORARY EXTENSION OF UNEMPLOYMENT COMPENSATION 

PROVISIONS 

Sec. 201. Temporary extension of unemployment compensation provisions. 

Sec. 202. Extended unemployment benefits under the Railroad Unemployment Insurance Act. 

TITLE III—TEMPORARY EXTENSION OF HEALTH PROVISIONS 

Sec. 301. Medicare physician payment update. 

Sec. 302. 2-month extension of MMA section 508 reclassifications. 

Sec. 303. Extension of Medicare work geographic adjustment floor. 

Sec. 304. Extension of exceptions process for Medicare therapy caps. 

Sec. 305. Extension of payment for technical component of certain physician pathology services. 

Sec. 306. Extension of ambulance add-ons. 

Sec. 307. Extension of physician fee schedule mental health add-on payment. 

Sec. 308. Extension of outpatient hold harmless provision. 

Sec. 309. Extending minimum payment for bone mass measurement. 

Sec. 310. Extension of the qualifying individual (QI) program. 

Sec. 311. Extension of Transitional Medical Assistance (TMA). 

Sec. 312. Extension of the temporary assistance for needy families program. 

TITLE IV—MORTGAGE FEES AND PREMIUMS 

Sec. 401. Guarantee Fees. 

Sec. 402. FHA guarantee fees. 

TITLE V—OTHER PROVISIONS 

Subtitle A—Keystone XL Pipeline 

Sec. 501. Permit for Keystone XL pipeline. 

Subtitle B—Budgetary Provisions 

Sec. 511. Senate point of order against an emergency designation. 

Sec. 512. PAYGO scorecard estimates. 

Temporary 

Payroll Tax Cut 

Continuation Act 

of 2011. 

26 USC 1 note. 

Dec. 23, 2011 

[H.R. 3765] 


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PUBLIC LAW 112–78—DEC. 23, 2011 125 STAT. 1281 

TITLE I—TEMPORARY PAYROLL TAX 

RELIEF 

SEC. 101. EXTENSION OF PAYROLL TAX HOLIDAY. 

(a) IN GENERAL.—Subsection (c) of section 601 of the Tax Relief, 

Unemployment Insurance Reauthorization, and Job Creation Act 

of 2010 (26 U.S.C. 1401 note) is amended to read as follows: 

‘‘(c) PAYROLL TAX HOLIDAY PERIOD.—The term ‘payroll tax holiday period’ means— 

‘‘(1) in the case of the tax described in subsection (a)(1), 

calendar years 2011 and 2012, and 

‘‘(2) in the case of the taxes described in subsection (a)(2), 

the period beginning January 1, 2011, and ending February 

29, 2012.’’. 

(b) SPECIAL RULES FOR 2012.—Section 601 of such Act (26 

U.S.C. 1401 note) is amended by adding at the end the following 

new subsection: 

‘‘(f) SPECIAL RULES FOR 2012.— 

‘‘(1) LIMITATION ON SELF-EMPLOYMENT INCOME.—In the case 

of any taxable year beginning in 2012, subsection (a)(1) shall 

only apply with respect to so much of the taxpayer’s selfemployment income (as defined in section 1402(b) of the 

Internal Revenue Code of 1986) as does not exceed the excess 

(if any) of— 

‘‘(A) $18,350, over 

‘‘(B) the amount of wages and compensation received 

during the portion of the payroll tax holiday period occurring during 2012 subject to tax under section 3101(a) of 

such Code or section 3201(a) of such Code. 

‘‘(2) COORDINATION WITH DEDUCTION FOR EMPLOYMENT

TAXES.—In the case of a taxable year beginning in 2012, 

subparagraph (A) of subsection (b)(2) shall be applied as if 

it read as follows: 

‘‘ ‘(A) the sum of— 

‘‘ ‘(i) 59.6 percent of the portion of such taxes attributable to the tax imposed by section 1401(a) of such 

Code (determined after the application of this section) 

on so much of self-employment income (as defined in 

section 1402(b) of such Code) as does not exceed the 

amount of self-employment income described in paragraph (1), plus 

‘‘ ‘(ii) one-half of the portion of such taxes attributable to the tax imposed by section 1401(a) of such 

Code (determined without regard to this section) on 

self-employment income (as so defined) in excess of 

such amount, plus’.’’. 

(c) RECAPTURE OF EXCESS BENEFIT.—Section 601 of such Act 

(26 U.S.C. 1401 note), as amended by subsection (b), is further 

amended by adding at the end the following new subsection: 

‘‘(g) RECAPTURE OF EXCESS BENEFIT.— 

‘‘(1) IN GENERAL.—There is hereby imposed on the income 

of every individual a tax equal to 2 percent of the sum of 

wages (within the meaning of section 3121(a)(1) of the Internal 

Revenue Code of 1986) and compensation (to which section 

Applicability. 

Definition. 


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125 STAT. 1282 PUBLIC LAW 112–78—DEC. 23, 2011 

3201(a) of such Code applies) received during the period beginning January 1, 2012, and ending February 29, 2012, to the 

extent the amount of such sum exceeds $18,350. 

‘‘(2) REGULATIONS.—The Secretary of the Treasury or the 

Secretary’s delegate shall prescribe such regulations or other 

guidance as may be necessary or appropriate to carry out 

this subsection, including guidance for payment by the 

employee of the tax imposed by paragraph (1).’’. 

(d) TECHNICAL AMENDMENTS.—Paragraph (2) of section 601(b) 

of such Act (26 U.S.C. 1401 note) is amended— 

(1) by inserting ‘‘of such Code’’ after ‘‘164(f)’’; 

(2) by inserting ‘‘of such Code’’ after ‘‘1401(a)’’ in subparagraph (A); and 

(3) by inserting ‘‘of such Code’’ after ‘‘1401(b)’’ in subparagraph (B). 

(e) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as provided in paragraph (2), the 

amendments made by this section shall apply to remuneration 

received, and taxable years beginning, after December 31, 2011. 

(2) TECHNICAL AMENDMENTS.—The amendments made by 

subsection (d) shall take effect as if included in the enactment 

of section 601 of the Tax Relief, Unemployment Insurance 

Reauthorization, and Job Creation Act of 2010. 

TITLE II—TEMPORARY EXTENSION OF 

UNEMPLOYMENT COMPENSATION 

PROVISIONS 

SEC. 201. TEMPORARY EXTENSION OF UNEMPLOYMENT COMPENSATION PROVISIONS. 

(a) IN GENERAL.—(1) Section 4007 of the Supplemental Appropriations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 note) 

is amended— 

(A) by striking ‘‘January 3, 2012’’ each place it appears 

and inserting ‘‘March 6, 2012’’; 

(B) in the heading for subsection (b)(2), by striking 

‘‘JANUARY 3, 2012’’ and inserting ‘‘MARCH 6, 2012’’; and 

(C) in subsection (b)(3), by striking ‘‘June 9, 2012’’ and 

inserting ‘‘August 15, 2012’’. 

(2) Section 2005 of the Assistance for Unemployed Workers 

and Struggling Families Act, as contained in Public Law 111– 

5 (26 U.S.C. 3304 note; 123 Stat. 444), is amended— 

(A) by striking ‘‘January 4, 2012’’ each place it appears 

and inserting ‘‘March 7, 2012’’; and 

(B) in subsection (c), by striking ‘‘June 11, 2012’’ and 

inserting ‘‘August 15, 2012’’. 

(3) Section 5 of the Unemployment Compensation Extension 

Act of 2008 (Public Law 110–449; 26 U.S.C. 3304 note) is amended 

by striking ‘‘June 10, 2012’’ and inserting ‘‘August 15, 2012’’. 

(4) Section 203 of the Federal-State Extended Unemployment 

Compensation Act of 1970 (26 U.S.C. 3304 note) is amended— 

(A) in subsection (d), in the second sentence of the flush 

matter following paragraph (2), by striking ‘‘December 31, 2011’’ 

and inserting ‘‘February 29, 2012’’; and 

26 USC 1401 

note. 

Applicability. 


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PUBLIC LAW 112–78—DEC. 23, 2011 125 STAT. 1283 

(B) in subsection (f)(2), by striking ‘‘December 31, 2011’’ 

and inserting ‘‘February 29, 2012’’. 

(b) FUNDING.—Section 4004(e)(1) of the Supplemental Appropriations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 note) 

is amended— 

(1) in subparagraph (F), by striking ‘‘and’’ at the end; 

and 

(2) by inserting after subparagraph (G) the following: 

‘‘(H) the amendments made by section 201(a)(1) of the 

Temporary Payroll Tax Cut Continuation Act of 2011; and’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall take effect as if included in the enactment of the Tax Relief, 

Unemployment Insurance Reauthorization, and Job Creation Act 

of 2010 (Public Law 111–312). 

SEC. 202. EXTENDED UNEMPLOYMENT BENEFITS UNDER THE RAILROAD UNEMPLOYMENT INSURANCE ACT. 

(a) EXTENSION.—Section 2(c)(2)(D)(iii) of the Railroad 

Unemployment Insurance Act, as added by section 2006 of the 

American Recovery and Reinvestment Act of 2009 (Public Law 

111–5) and as amended by section 9 of the Worker, Homeownership, 

and Business Assistance Act of 2009 (Public Law 111–92) and 

section 505 of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (Public Law 111–312), is 

amended— 

(1) by striking ‘‘June 30, 2011’’ and inserting ‘‘August 31, 

2011’’; and 

(2) by striking ‘‘December 31, 2011’’ and inserting ‘‘February 29, 2012’’. 

(b) CLARIFICATION ON AUTHORITY TO USE FUNDS.—Funds 

appropriated under either the first or second sentence of clause 

(iv) of section 2(c)(2)(D) of the Railroad Unemployment Insurance 

Act shall be available to cover the cost of additional extended 

unemployment benefits provided under such section 2(c)(2)(D) by 

reason of the amendments made by subsection (a) as well as to 

cover the cost of such benefits provided under such section 

2(c)(2)(D), as in effect on the day before the date of the enactment 

of this Act. 

TITLE III—TEMPORARY EXTENSION OF 

HEALTH PROVISIONS 

SEC. 301. MEDICARE PHYSICIAN PAYMENT UPDATE. 

Section 1848(d) of the Social Security Act (42 U.S.C. 1395w– 

4(d)) is amended by adding at the end the following new paragraph: 

‘‘(13) UPDATE FOR FIRST TWO MONTHS OF 2012.— 

‘‘(A) IN GENERAL.—Subject to paragraphs (7)(B), (8)(B), 

(9)(B), (10)(B), (11)(B), and (12)(B), in lieu of the update 

to the single conversion factor established in paragraph 

(1)(C) that would otherwise apply for the period beginning 

on January 1, 2012, and ending on February 29, 2012, 

the update to the single conversion factor shall be zero 

percent. 

‘‘(B) NO EFFECT ON COMPUTATION OF CONVERSION

FACTOR FOR REMAINING PORTION OF 2012 AND SUBSEQUENT

YEARS.—The conversion factor under this subsection shall 

45 USC 352. 

26 USC 3304 

note. 


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125 STAT. 1284 PUBLIC LAW 112–78—DEC. 23, 2011 

be computed under paragraph (1)(A) for the period beginning on March 1, 2012, and ending on December 31, 2012, 

and for 2013 and subsequent years as if subparagraph 

(A) had never applied.’’. 

SEC. 302. 2-MONTH EXTENSION OF MMA SECTION 508 RECLASSIFICATIONS. 

(a) IN GENERAL.—Section 106(a) of division B of the Tax Relief 

and Health Care Act of 2006 (42 U.S.C. 1395 note), as amended 

by section 117 of the Medicare, Medicaid, and SCHIP Extension 

Act of 2007 (Public Law 110–173), section 124 of the Medicare 

Improvements for Patients and Providers Act of 2008 (Public Law 

110–275), sections 3137(a) and 10317 of the Patient Protection 

and Affordable Care Act (Public Law 111–148), and section 102(a) 

of the Medicare and Medicaid Extenders Act of 2010 (Public Law 

111–309), is amended by striking ‘‘September 30, 2011’’ and 

inserting ‘‘November 30, 2011’’. 

(b) SPECIAL RULE FOR OCTOBER AND NOVEMBER 2011.— 

(1) IN GENERAL.—Subject to paragraph (2), for purposes 

of implementation of the amendment made by subsection (a), 

including for purposes of the implementation of paragraph (2) 

of section 117(a) of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (Public Law 110–173), for the period beginning 

on October 1, 2011, and ending on November 30, 2011, the 

Secretary of Health and Human Services shall use the hospital 

wage index that was promulgated by the Secretary of Health 

and Human Services in the Federal Register on August 18, 

2011 (76 Fed. Reg. 51476), and any subsequent corrections. 

(2) EXCEPTION.—In determining the wage index applicable 

to hospitals that qualify for wage index reclassification, the 

Secretary shall, for the period beginning on October 1, 2011, 

and ending on November 30, 2011, include the average hourly 

wage data of hospitals whose reclassification was extended 

pursuant to the amendment made by subsection (a) only if 

including such data results in a higher applicable reclassified 

wage index. Any revision to hospital wage indexes made as 

a result of this paragraph shall not be effected in a budget 

neutral manner. 

(c) TIMEFRAME FOR PAYMENTS.—The Secretary shall make payments required under subsections (a) and (b) by not later than 

December 31, 2012. 

SEC. 303. EXTENSION OF MEDICARE WORK GEOGRAPHIC ADJUSTMENT 

FLOOR. 

Section 1848(e)(1)(E) of the Social Security Act (42 U.S.C. 

1395w–4(e)(1)(E)) is amended by striking ‘‘before January 1, 2012’’ 

and inserting ‘‘before March 1, 2012’’. 

SEC. 304. EXTENSION OF EXCEPTIONS PROCESS FOR MEDICARE 

THERAPY CAPS. 

Section 1833(g)(5) of the Social Security Act (42 U.S.C. 

1395l(g)(5)) is amended by striking ‘‘December 31, 2011’’ and 

inserting ‘‘February 29, 2012’’. 

SEC. 305. EXTENSION OF PAYMENT FOR TECHNICAL COMPONENT OF 

CERTAIN PHYSICIAN PATHOLOGY SERVICES. 

Section 542(c) of the Medicare, Medicaid, and SCHIP Benefits 

Improvement and Protection Act of 2000 (as enacted into law by 

42 USC 1395ww 

note. 

42 USC 1395ww 

note. 

42 USC 1395ww 

note. 


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PUBLIC LAW 112–78—DEC. 23, 2011 125 STAT. 1285 

section 1(a)(6) of Public Law 106–554), as amended by section 

732 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (42 U.S.C. 1395w–4 note), section 104 of 

division B of the Tax Relief and Health Care Act of 2006 (42 

U.S.C. 1395w–4 note), section 104 of the Medicare, Medicaid, and 

SCHIP Extension Act of 2007 (Public Law 110–173), section 136 

of the Medicare Improvements for Patients and Providers Act of 

2008 (Public Law 110–275), section 3104 of the Patient Protection 

and Affordable Care Act (Public Law 111–148), and section 105 

of the Medicare and Medicaid Extenders Act of 2010 (Public Law 

111–309), is amended by striking ‘‘and 2011’’ and inserting ‘‘2011, 

and the first two months of 2012’’. 

SEC. 306. EXTENSION OF AMBULANCE ADD-ONS. 

(a) GROUND AMBULANCE.—Section 1834(l)(13)(A) of the Social 

Security Act (42 U.S.C. 1395m(l)(13)(A)) is amended— 

(1) in the matter preceding clause (i), by striking ‘‘January 

1, 2012’’ and inserting ‘‘March 1, 2012’’; and 

(2) in each of clauses (i) and (ii), by striking ‘‘January 

1, 2012’’ and inserting ‘‘March 1, 2012’’ each place it appears. 

(b) AIR AMBULANCE.—Section 146(b)(1) of the Medicare 

Improvements for Patients and Providers Act of 2008 (Public Law 

110–275), as amended by sections 3105(b) and 10311(b) of Public 

Law 111–148 and section 106(b) of the Medicare and Medicaid 

Extenders Act of 2010 (Public Law 111–309), is amended by striking 

‘‘December 31, 2011’’ and inserting ‘‘February 29, 2012’’. 

(c) SUPER RURAL AMBULANCE.—Section 1834(l)(12)(A) of the 

Social Security Act (42 U.S.C. 1395m(l)(12)(A)) is amended by 

striking ‘‘January 1, 2012’’ and inserting ‘‘March 1, 2012’’. 

SEC. 307. EXTENSION OF PHYSICIAN FEE SCHEDULE MENTAL HEALTH 

ADD-ON PAYMENT. 

Section 138(a)(1) of the Medicare Improvements for Patients 

and Providers Act of 2008 (Public Law 110–275), as amended by 

section 3107 of the Patient Protection and Affordable Care Act 

(Public Law 111–148) and section 107 of the Medicare and Medicaid 

Extenders Act of 2010 (Public Law 111–309), is amended by striking 

‘‘December 31, 2011’’ and inserting ‘‘February 29, 2012’’. 

SEC. 308. EXTENSION OF OUTPATIENT HOLD HARMLESS PROVISION. 

Section 1833(t)(7)(D)(i) of the Social Security Act (42 U.S.C. 

1395l(t)(7)(D)(i)), as amended by section 3121(a) of the Patient 

Protection and Affordable Care Act (Public Law 111–148) and section 108 of the Medicare and Medicaid Extenders Act of 2010 

(Public Law 111–309), is amended— 

(1) in subclause (II)— 

(A) in the first sentence, by striking ‘‘January 1, 2012’’ 

and inserting ‘‘March 1, 2012’’; and 

(B) in the second sentence, by striking ‘‘or 2011’’ and 

inserting ‘‘2011, or the first two months of 2012’’; and 

(2) in subclause (III)— 

(A) in the first sentence, by striking ‘‘2009, and’’ and 

all that follows through ‘‘for which’’ and inserting ‘‘2009, 

and before March 1, 2012, for which’’; and 

(B) in the second sentence, by striking ‘‘2010, and’’ 

and all that follows through ‘‘the preceding’’ and inserting 

‘‘2010, and before March 1, 2012, the preceding’’. 

42 USC 1395w–4 

note. 

42 USC 1395m 

note. 

42 USC 1395w–4 

note. 


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125 STAT. 1286 PUBLIC LAW 112–78—DEC. 23, 2011 

SEC. 309. EXTENDING MINIMUM PAYMENT FOR BONE MASS MEASUREMENT. 

Section 1848 of the Social Security Act (42 U.S.C. 1395w– 

4) is amended— 

(1) in subsection (b)— 

(A) in paragraph (4)(B), by striking ‘‘and 2011’’ and 

inserting ‘‘, 2011, and the first 2 months of 2012’’; and 

(B) in paragraph (6)— 

(i) in the matter preceding subparagraph (A), by 

striking ‘‘and 2011’’ and inserting ‘‘, 2011, and the 

first 2 months of 2012’’; and 

(ii) in subparagraph (C), by striking ‘‘and 2011’’ 

and inserting ‘‘, 2011, and the first 2 months of 2012’’; 

and 

(2) in subsection (c)(2)(B)(iv)(IV), by striking ‘‘or 2011’’ and 

inserting ‘‘, 2011, or the first 2 months of 2012’’. 

SEC. 310. EXTENSION OF THE QUALIFYING INDIVIDUAL (QI) PROGRAM. 

(a) EXTENSION.—Section 1902(a)(10)(E)(iv) of the Social Security 

Act (42 U.S.C. 1396a(a)(10)(E)(iv)) is amended by striking 

‘‘December 2011’’ and inserting ‘‘February 2012’’. 

(b) EXTENDING TOTAL AMOUNT AVAILABLE FOR ALLOCATION.— 

Section 1933(g) of such Act (42 U.S.C. 1396u–3(g)) is amended— 

(1) in paragraph (2)— 

(A) by striking ‘‘and’’ at the end of subparagraph (O); 

(B) in subparagraph (P), by striking the period at the 

end and inserting ‘‘; and’’; and 

(C) by adding at the end the following new subparagraph: 

‘‘(Q) for the period that begins on January 1, 2012, 

and ends on February 29, 2012, the total allocation amount 

is $150,000,000.’’. 

SEC. 311. EXTENSION OF TRANSITIONAL MEDICAL ASSISTANCE (TMA). 

Sections 1902(e)(1)(B) and 1925(f) of the Social Security Act 

(42 U.S.C. 1396a(e)(1)(B), 1396r–6(f)) are each amended by striking 

‘‘December 31, 2011’’ and inserting ‘‘February 29, 2012’’. 

SEC. 312. EXTENSION OF THE TEMPORARY ASSISTANCE FOR NEEDY 

FAMILIES PROGRAM. 

Activities authorized by part A of title IV and section 1108(b) 

of the Social Security Act (other than under subsections (a)(3) 

and (b) of section 403 of such Act) shall continue through February 

29, 2012, in the manner authorized for fiscal year 2011, and out 

of any money in the Treasury of the United States not otherwise 

appropriated, there are hereby appropriated such sums as may 

be necessary for such purpose. Grants and payments may be made 

pursuant to this authority through the applicable portion of the 

second quarter of fiscal year 2012 at the pro rata portion of the 

level provided for such activities through the second quarter of 

fiscal year 2011. 

Appropriation 

authorization. 

Time period. 


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PUBLIC LAW 112–78—DEC. 23, 2011 125 STAT. 1287 

TITLE IV—MORTGAGE FEES AND 

PREMIUMS 

SEC. 401. GUARANTEE FEES. 

Subpart A of part 2 of subtitle A of title XIII of the Housing 

and Community Development Act of 1992 is amended by adding 

after section 1326 (12 U.S.C. 4546) the following new section: 

‘‘SEC. 1327. ENTERPRISE GUARANTEE FEES. 

‘‘(a) DEFINITIONS.—For purposes of this section, the following 

definitions shall apply: 

‘‘(1) GUARANTEE FEE.—The term ‘guarantee fee’— 

‘‘(A) means a fee described in subsection (b); and 

‘‘(B) includes— 

‘‘(i) the guaranty fee charged by the Federal 

National Mortgage Association with respect to mortgage-backed securities; and 

‘‘(ii) the management and guarantee fee charged 

by the Federal Home Loan Mortgage Corporation with 

respect to participation certificates. 

‘‘(2) AVERAGE FEES.—The term ‘average fees’ means the 

average contractual fee rate of single-family guaranty arrangements by an enterprise entered into during 2011, plus the 

recognition of any up-front cash payments over an estimated 

average life, expressed in terms of basis points. Such definition 

shall be interpreted in a manner consistent with the annual 

report on guarantee fees by the Federal Housing Finance 

Agency. 

‘‘(b) INCREASE.— 

‘‘(1) IN GENERAL.— 

‘‘(A) PHASED INCREASE REQUIRED.—Subject to subsection (c), the Director shall require each enterprise to 

charge a guarantee fee in connection with any guarantee 

of the timely payment of principal and interest on securities, notes, and other obligations based on or backed by 

mortgages on residential real properties designed principally for occupancy of from 1 to 4 families, consummated 

after the date of enactment of this section. 

‘‘(B) AMOUNT.—The amount of the increase required 

under this section shall be determined by the Director 

to appropriately reflect the risk of loss, as well the cost 

of capital allocated to similar assets held by other fully 

private regulated financial institutions, but such amount 

shall be not less than an average increase of 10 basis 

points for each origination year or book year above the 

average fees imposed in 2011 for such guarantees. The 

Director shall prohibit an enterprise from offsetting the 

cost of the fee to mortgage originators, borrowers, and 

investors by decreasing other charges, fees, or premiums, 

or in any other manner. 

‘‘(2) AUTHORITY TO LIMIT OFFER OF GUARANTEE.—The 

Director shall prohibit an enterprise from consummating any 

offer for a guarantee to a lender for mortgage-backed securities, 

if— 

‘‘(A) the guarantee is inconsistent with the requirements of this section; or 

Applicability. 

12 USC 4547. 


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125 STAT. 1288 PUBLIC LAW 112–78—DEC. 23, 2011 

‘‘(B) the risk of loss is allowed to increase, through 

lowering of the underwriting standards or other means, 

for the primary purpose of meeting the requirements of 

this section. 

‘‘(3) DEPOSIT IN TREASURY.—Amounts received from fee 

increases imposed under this section shall be deposited directly 

into the United States Treasury, and shall be available only 

to the extent provided in subsequent appropriations Acts. The 

fees charged pursuant to this section shall not be considered 

a reimbursement to the Federal Government for the costs or 

subsidy provided to an enterprise. 

‘‘(c) PHASE-IN.— ‘‘(1) IN GENERAL.—The Director may provide for compliance 

with subsection (b) by allowing each enterprise to increase 

the guarantee fee charged by the enterprise gradually over 

the 2-year period beginning on the date of enactment of this 

section, in a manner sufficient to comply with this section. 

In determining a schedule for such increases, the Director 

shall— 

‘‘(A) provide for uniform pricing among lenders; 

‘‘(B) provide for adjustments in pricing based on risk 

levels; and 

‘‘(C) take into consideration conditions in financial markets. 

‘‘(2) RULE OF CONSTRUCTION.—Nothing in this subsection 

shall be interpreted to undermine the minimum increase 

required by subsection (b). 

‘‘(d) INFORMATION COLLECTION AND ANNUAL ANALYSIS.—The 

Director shall require each enterprise to provide to the Director, 

as part of its annual report submitted to Congress— 

‘‘(1) a description of— 

‘‘(A) changes made to up-front fees and annual fees 

as part of the guarantee fees negotiated with lenders; 

‘‘(B) changes to the riskiness of the new borrowers 

compared to previous origination years or book years; and 

‘‘(C) any adjustments required to improve for future 

origination years or book years, in order to be in complete 

compliance with subsection (b); and 

‘‘(2) an assessment of how the changes in the guarantee 

fees described in paragraph (1) met the requirements of subsection (b). 

‘‘(e) ENFORCEMENT.— 

‘‘(1) REQUIRED ADJUSTMENTS.—Based on the information 

from subsection (d) and any other information the Director 

deems necessary, the Director shall require an enterprise to 

make adjustments in its guarantee fee in order to be in compliance with subsection (b). 

‘‘(2) NONCOMPLIANCE PENALTY.—An enterprise that has 

been found to be out of compliance with subsection (b) for 

any 2 consecutive years shall be precluded from providing any 

guarantee for a period, determined by rule of the Director, 

but in no case less than 1 year. 

‘‘(3) RULE OF CONSTRUCTION.—Nothing in this subsection 

shall be interpreted as preventing the Director from initiating 

and implementing an enforcement action against an enterprise, 

at a time the Director deems necessary, under other existing 

enforcement authority. 

Reports. 

Time period. 


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PUBLIC LAW 112–78—DEC. 23, 2011 125 STAT. 1289 

‘‘(f) EXPIRATION.—The provisions of this section shall expire 

on October 1, 2021.’’. 

SEC. 402. FHA GUARANTEE FEES. 

(a) AMENDMENT.—Section 203(c)(2) of the National Housing 

Act (12 U.S.C. 1709(c)(2)) is amended by adding at the end the 

following: 

‘‘(C)(i) In addition to the premiums under subparagraphs 

(A) and (B), the Secretary shall establish and collect annual 

premium payments for any mortgage for which the Secretary 

collects an annual premium payment under subparagraph (B), 

in an amount described in clause (ii). 

‘‘(ii)(I) Subject to subclause (II), with respect to a mortgage, 

the amount described in this clause is 10 basis points of the 

remaining insured principal balance (excluding the portion of 

the remaining balance attributable to the premium collected 

under subparagraph (A) and without taking into account delinquent payments or prepayments). 

‘‘(II) During the 2-year period beginning on the date of 

enactment of this subparagraph, the Secretary shall increase 

the number of basis points of the annual premium payment 

collected under this subparagraph incrementally, as determined 

appropriate by the Secretary, until the number of basis points 

of the annual premium payment collected under this subparagraph is equal to the number described in subclause (I).’’. 

(b) PROSPECTIVE REPEAL.—Section 203(c)(2) of the National 

Housing Act (12 U.S.C. 1709(c)(2)) is amended by striking subparagraph (C), as added by subsection (a), effective on October 1, 2021. 

(c) REPORT REQUIRED.—Not later than 30 days before the date 

on which the Secretary of Housing and Urban Development makes 

a determination under subsection (b)(2), the Secretary shall submit 

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 that— 

(1) explains the basis for the determination; and 

(2) identifies the date on which the Secretary plans to 

make the determination. 

TITLE V—OTHER PROVISIONS 

Subtitle A—Keystone XL Pipeline 

SEC. 501. PERMIT FOR KEYSTONE XL PIPELINE. 

(a) IN GENERAL.—Except as provided in subsection (b), not 

later than 60 days after the date of enactment of this Act, the 

President, acting through the Secretary of State, shall grant a 

permit under Executive Order No. 13337 (3 U.S.C. 301 note; relating 

to issuance of permits with respect to certain energy-related facilities and land transportation crossings on the international boundaries of the United States) for the Keystone XL pipeline project 

application filed on September 19, 2008 (including amendments). 

(b) EXCEPTION.— 

(1) IN GENERAL.—The President shall not be required to 

grant the permit under subsection (a) if the President determines that the Keystone XL pipeline would not serve the 

national interest. 

Determination. 

Deadline. 

President. 

Determination. 

12 USC 1709 

note. 

Effective date. 

Time period. 

Determination. 


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125 STAT. 1290 PUBLIC LAW 112–78—DEC. 23, 2011 

(2) REPORT.—If the President determines that the Keystone 

XL pipeline is not in the national interest under paragraph 

(1), the President shall, not later than 15 days after the date 

of the determination, submit to the Committee on Foreign 

Relations of the Senate, the Committee on Foreign Affairs 

of the House of Representatives, the majority leader of the 

Senate, the minority leader of the Senate, the Speaker of the 

House of Representatives, and the minority leader of the House 

of Representatives a report that provides a justification for 

determination, including consideration of economic, employment, energy security, foreign policy, trade, and environmental 

factors. 

(3) EFFECT OF NO FINDING OR ACTION.—If a determination 

is not made under paragraph (1) and no action is taken by 

the President under subsection (a) not later than 60 days 

after the date of enactment of this Act, the permit for the 

Keystone XL pipeline described in subsection (a) that meets 

the requirements of subsections (c) and (d) shall be in effect 

by operation of law. 

(c) REQUIREMENTS.—The permit granted under subsection (a) 

shall require the following: 

(1) The permittee shall comply with all applicable Federal 

and State laws (including regulations) and all applicable industrial codes regarding the construction, connection, operation, 

and maintenance of the United States facilities. 

(2) The permittee shall obtain all requisite permits from 

Canadian authorities and relevant Federal, State, and local 

governmental agencies. 

(3) The permittee shall take all appropriate measures to 

prevent or mitigate any adverse environmental impact or 

disruption of historic properties in connection with the construction, operation, and maintenance of the United States facilities. 

(4) For the purpose of the permit issued under subsection 

(a) (regardless of any modifications under subsection (d))— 

(A) the final environmental impact statement issued 

by the Secretary of State on August 26, 2011, satisfies 

all requirements of the National Environmental Policy Act 

of 1969 (42 U.S.C. 4321 et seq.) and section 106 of the 

National Historic Preservation Act (16 U.S.C. 470f); 

(B) any modification required by the Secretary of State 

to the Plan described in paragraph (5)(A) shall not require 

supplementation of the final environmental impact statement described in that paragraph; and 

(C) no further Federal environmental review shall be 

required. 

(5) The construction, operation, and maintenance of the 

facilities shall be in all material respects similar to that 

described in the application described in subsection (a) and 

in accordance with— 

(A) the construction, mitigation, and reclamation measures agreed to by the permittee in the Construction Mitigation and Reclamation Plan found in appendix B of the 

final environmental impact statement issued by the Secretary of State on August 26, 2011, subject to the modification described in subsection (d); 

(B) the special conditions agreed to between the permittee and the Administrator of the Pipeline Hazardous 


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PUBLIC LAW 112–78—DEC. 23, 2011 125 STAT. 1291 

Materials Safety Administration of the Department of 

Transportation found in appendix U of the final environmental impact statement described in subparagraph (A); 

(C) if the modified route submitted by the Governor 

of Nebraska under subsection (d)(3)(B) crosses the Sand 

Hills region, the measures agreed to by the permittee for 

the Sand Hills region found in appendix H of the final 

environmental impact statement described in subparagraph 

(A); and 

(D) the stipulations identified in appendix S of the 

final environmental impact statement described in subparagraph (A). 

(6) Other requirements that are standard industry practice 

or commonly included in Federal permits that are similar to 

a permit issued under subsection (a). 

(d) MODIFICATION.—The permit issued under subsection (a) 

shall require— 

(1) the reconsideration of routing of the Keystone XL pipeline within the State of Nebraska; 

(2) a review period during which routing within the State 

of Nebraska may be reconsidered and the route of the Keystone 

XL pipeline through the State altered with any accompanying 

modification to the Plan described in subsection (c)(5)(A); and 

(3) the President— 

(A) to coordinate review with the State of Nebraska 

and provide any necessary data and reasonable technical 

assistance material to the review process required under 

this subsection; and 

(B) to approve the route within the State of Nebraska 

that has been submitted to the Secretary of State by the 

Governor of Nebraska. 

(e) EFFECT OF NO APPROVAL.—If the President does not approve 

the route within the State of Nebraska submitted by the Governor 

of Nebraska under subsection (d)(3)(B) not later than 10 days 

after the date of submission, the route submitted by the Governor 

of Nebraska under subsection (d)(3)(B) shall be considered approved, 

pursuant to the terms of the permit described in subsection (a) 

that meets the requirements of subsection (c) and this subsection, 

by operation of law. 

(f) PRIVATE PROPERTY SAVINGS CLAUSE.—Nothing in this section alters the Federal, State, or local processes or conditions in 

effect on the date of enactment of this Act that are necessary 

to secure access from private property owners to construct the 

Keystone XL pipeline. 

Subtitle B—Budgetary Provisions 

SEC. 511. SENATE POINT OF ORDER AGAINST AN EMERGENCY DESIGNATION. 

Section 314 of the Congressional Budget Act of 1974 is amended 

by— 

(1) redesignating subsection (e) as subsection (f); and 

(2) inserting after subsection (d) the following: 

‘‘(e) SENATE POINT OF ORDER AGAINST AN EMERGENCY DESIGNA- TION.— 

2 USC 645. 

Nebraska. 

Nebraska. 


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125 STAT. 1292 PUBLIC LAW 112–78—DEC. 23, 2011 

‘‘(1) IN GENERAL.—When the Senate is considering a bill, 

resolution, amendment, motion, amendment between the 

Houses, or conference report, if a point of order is made by 

a Senator against an emergency designation in that measure, 

that provision making such a designation shall be stricken 

from the measure and may not be offered as an amendment 

from the floor. 

‘‘(2) SUPERMAJORITY WAIVER AND APPEALS.— 

‘‘(A) WAIVER.—Paragraph (1) may be waived or suspended in the Senate only by an affirmative vote of threefifths of the Members, duly chosen and sworn. 

‘‘(B) APPEALS.—Appeals in the Senate from the 

decisions of the Chair relating to any provision of this 

subsection shall be limited to 1 hour, to be equally divided 

between, and controlled by, the appellant and the manager 

of the bill or joint resolution, as the case may be. An 

affirmative vote of three-fifths of the Members of the 

Senate, duly chosen and sworn, shall be required to sustain 

an appeal of the ruling of the Chair on a point of order 

raised under this subsection. 

‘‘(3) DEFINITION OF AN EMERGENCY DESIGNATION.—For purposes of paragraph (1), a provision shall be considered an 

emergency designation if it designates any item pursuant to 

section 251(b)(2)(A)(i) of the Balanced Budget and Emergency 

Deficit Control Act of 1985. 

‘‘(4) FORM OF THE POINT OF ORDER.—A point of order under 

paragraph (1) may be raised by a Senator as provided in 

section 313(e) of the Congressional Budget Act of 1974. 

‘‘(5) CONFERENCE REPORTS.—When the Senate is considering a conference report on, or an amendment between the 

Houses in relation to, a bill, upon a point of order being made 

by any Senator pursuant to this section, and such point of 

order being sustained, such material contained in such conference report shall be deemed stricken, and the Senate shall 

proceed to consider the question of whether the Senate shall 

recede from its amendment and concur with a further amendment, or concur in the House amendment with a further amendment, as the case may be, which further amendment shall 

consist of only that portion of the conference report or House 

amendment, as the case may be, not so stricken. Any such 

motion in the Senate shall be debatable. In any case in which 

such point of order is sustained against a conference report 

(or Senate amendment derived from such conference report 

by operation of this subsection), no further amendment shall 

be in order.’’. 


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PUBLIC LAW 112–78—DEC. 23, 2011 125 STAT. 1293 

LEGISLATIVE HISTORY—H.R. 3765: 

CONGRESSIONAL RECORD, Vol. 157 (2011): 

Dec. 23, considered and passed House and Senate. 

Æ 

SEC. 512. PAYGO SCORECARD ESTIMATES. 

The budgetary effects of this Act shall not be entered on either 

PAYGO scorecard maintained pursuant to section 4(d) of the Statutory Pay-As-You-Go Act of 2010. 

Approved December 23, 2011. 


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