I 

112TH CONGRESS 

2D SESSION H. R. 4308 

To authorize the Secretary of the Treasury to provide growth and stability 

funding for the city of Detroit. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 29, 2012 

Mr. CLARKE of Michigan (for himself, Mr. CONYERS, Mr. CLEAVER, Ms. 

HANABUSA, and Ms. NORTON) introduced the following bill; which was 

referred to the Committee on Oversight and Government Reform 

A BILL 

To authorize the Secretary of the Treasury to provide growth 

and stability funding for the city of Detroit. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Detroit Growth and 

5 Stability Act of 2012’’. 

6 SEC. 2. FINDINGS. 

7 The Congress makes the following findings: 

8 (1) The City of Detroit is an essential part of 

9 the Nation’s economy and, in particular, the Na10 tion’s manufacturing sector. 


srobinson on DSK4SPTVN1PROD with BILLS
2 

•HR 4308 IH

1 (2) Absent decisive action from the Federal 

2 Government, the City of Detroit risks bankruptcy 

3 and loan default. 

4 (3) A bankruptcy or default of the City of De5 troit would have broad negative economic con6 sequences on the State of Michigan and the Nation. 

7 SEC. 3. DEFINITIONS. 

8 In this Act: 

9 (1) The term ‘‘city’’ means the city of Detroit, 

10 Michigan. 

11 (2) The term ‘‘State’’ means the State of 

12 Michigan. 

13 (3) The term ‘‘financing agent’’ means any 

14 agency duly authorized by State law, and approved 

15 by the city, to act on behalf or in the interest of the 

16 city with respect to the city’s financial affairs. 

17 (4) The term ‘‘Secretary’’ means the Secretary 

18 of the Treasury. 

19 SEC. 4. LOANS. 

20 (a) IN GENERAL.—Upon written request of a financ21 ing agent, the Secretary may make loans to such agent 

22 subject to the provisions of this Act and the city and such 

23 agent shall be jointly and severally liable thereon. 

24 (b) MATURITY.—Each such loan shall mature not 

25 later than 30 years after the last day of the city’s fiscal 


srobinson on DSK4SPTVN1PROD with BILLS
3 

•HR 4308 IH

1 year in which it was made, and shall bear interest at an 

2 annual rate equal to the current average market yield on 

3 outstanding marketable obligations of the United States 

4 with remaining periods to maturity comparable to the ma5 turities of such loan, as determined by the Secretary at 

6 the time of the loan. 

7 (c) PREPAYMENT.—The Secretary may not charge 

8 any prepayment penalties with respect to any loan made 

9 under this Act. 

10 SEC. 5. SECURITY FOR LOANS. 

11 In connection with any loan made under this Act, the 

12 Secretary may require the city and a financing agent and, 

13 where the Secretary deems necessary, the State, to provide 

14 such security as the Secretary deems appropriate. The 

15 Secretary may take such steps as such Secretary deems 

16 necessary to realize upon any collateral in which the 

17 United States has a security interest pursuant to this sec18 tion to enforce any claim the United States may have 

19 against the city or any financing agent pursuant to this 

20 Act. Notwithstanding any other provision of law, Acts 

21 making appropriations may provide for the withholding of 

22 any payments from the United States to the city, either 

23 directly or through the State, which may be or may be24 come due pursuant to any law and offset the amount of 

25 such withheld payments against any claim the Secretary 


srobinson on DSK4SPTVN1PROD with BILLS
4 

•HR 4308 IH

1 may have against the city or any financing agent pursuant 

2 to this Act. With respect to debts incurred pursuant to 

3 this Act, for the purposes of section 3466 of the Revised 

4 statutes (31 U.S.C. 181) the term ‘‘person’’ includes any 

5 financing agent. 

6 SEC. 6. LIMITATIONS. 

7 At no time shall the amount of loans outstanding 

8 under this Act exceed in the aggregate $500,000,000. 

9 SEC. 7. REMEDIES. 

10 The remedies of the Secretary prescribed in this Act 

11 shall be cumulative and not in limitation of or substitution 

12 for any other remedies available to the Secretary or the 

13 United States. 

14 SEC. 8. FUNDING. 

15 (a) ESTABLISHMENT OF FUND.—There is hereby es16 tablished in the Treasury a fund to be known as the ‘‘City 

17 of Detroit Growth and Stability Fund’’, which shall be ad18 ministered by the Secretary. The fund shall be used for 

19 the purpose of making loans pursuant to this Act. There 

20 is authorized to be appropriated to such fund the sum of 

21 $500,000,000. 

22 (b) ADMINISTRATIVE COSTS.—There are authorized 

23 to be appropriated such sums as may be necessary to pay 

24 the expenses of administration of this Act. 


srobinson on DSK4SPTVN1PROD with BILLS
5 

•HR 4308 IH

1 SEC. 9. INSPECTION OF DOCUMENTS. 

2 At any time a request for a loan is pending or a loan 

3 is outstanding under this Act, the Secretary is authorized 

4 to inspect and copy all accounts, books, records, memoran5 dums, correspondence, and other documents of the city or 

6 any financing agent relating to its financial affairs. 

7 SEC. 10. AUDITS. 

8 No loan may be made under this Act for the benefit 

9 of any State or city unless the General Accounting Office 

10 is authorized to make such audits as may be deemed ap11 propriate by either the Secretary or the General Account12 ing Office of all accounts, books, records, and transactions 

13 of the State, the political subdivision, if any, involved, and 

14 any agency or instrumentality of such State or political 

15 subdivision. The General Accounting Office shall report 

16 the results of any such audit to the Secretary and to the 

17 Congress. 

18 SEC. 11. TERMINATION. 

19 The authority of the Secretary to make any loan 

20 under this Act terminates on January 1, 2016. Such ter21 mination does not affect the carrying out of any trans22 action entered into pursuant to this Act prior to that date, 

23 or the taking of any action necessary to preserve or protect 

24 the interests of the United States arising out of any loan 

25 under this Act. 

Æ 


srobinson on DSK4SPTVN1PROD with BILLS