I 

112TH CONGRESS 

1ST SESSION H. R. 1225 

To prohibit Fannie Mae and Freddie Mac from issuing any new debt without 

approval in advance by the Secretary of the Treasury. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 29, 2011 

Mr. PEARCE (for himself, Mr. GARRETT, Mr. BACHUS, and Mr. HENSARLING) 

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

A BILL 

To prohibit Fannie Mae and Freddie Mac from issuing any 

new debt without approval in advance by the Secretary 

of the Treasury. 

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 ‘‘GSE Debt Issuance 

5 Approval Act of 2011’’. 


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1 SEC. 2. PROHIBITION OF ISSUANCE OF NEW DEBT BY EN2 TERPRISES WITHOUT ADVANCE APPROVAL 

3 BY TREASURY. 

4 Subtitle B of title XIII of the Housing and Commu5 nity Development Act of 1992 (12 U.S.C. 4611 et seq.) 

6 is amended by adding at the end the following new section: 

7 ‘‘SEC. 1369F. REQUIREMENTS FOR ISSUANCE OF NEW DEBT. 

8 ‘‘(a) REQUIREMENT FOR ADVANCE APPROVAL BY

9 TREASURY.—An enterprise shall not, after the date of the 

10 enactment of the GSE Debt Issuance Approval Act of 

11 2011, newly issue any note, bill, bond, debenture, or any 

12 other debt security, obligation, or instrument of any form 

13 or in any amount unless the issuance of such debt secu14 rity, obligation, or instrument was approved in advance 

15 in accordance with this section by the Secretary of the 

16 Treasury (in this section referred to as the ‘Secretary’). 

17 ‘‘(b) WRITTEN REQUEST.—The Secretary may not 

18 approve the issuance of any debt security, obligation, or 

19 instrument under this section by an enterprise unless the 

20 enterprise has submitted to the Secretary of the Treasury 

21 and to the Director, in such form as the Secretary shall 

22 require, a written request identifying and describing the 

23 debt securities, obligations, and instruments proposed to 

24 be issued, including the par values, terms to maturity, in25 terest rates, forms, timing of issuance, and all other terms 


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1 regarding issuance of such securities, obligations, and in2 struments. 

3 ‘‘(c) DETERMINATION AND JUSTIFICATION.—Upon 

4 receiving a written request pursuant to subsection (b) for 

5 approval of the issuance of debt by an enterprise, the Sec6 retary shall promptly review the request, make a deter7 mination of whether to approve or deny the request, tak8 ing into consideration any information or comments of the 

9 Director regarding such request, and submit to the enter10 prise, the Congress, and the Director written notice of ap11 proval or denial of the request, which shall include an ex12 planation and justification for the approval or denial of 

13 the issuance of the new debt. 

14 ‘‘(d) CONDITIONAL APPROVAL.—In approving a re15 quest under this section by an enterprise to issue any debt 

16 security, obligation, or instrument, the Secretary may, in 

17 the written notice of approval of such request pursuant 

18 to subsection (c), limit or change the terms of the issuance 

19 of the debt securities, obligations, or instruments approved 

20 for issuance from the terms of the proposed issuance of 

21 securities, obligations, or instruments described in the re22 quest for such approval submitted by the enterprise pursu23 ant to subsection (b). 

24 ‘‘(e) EFFECTIVE DATE.—Notwithstanding approval 

25 under this section of the issuance of debt by an enterprise 


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1 or submission of the notice of such approval as required 

2 under subsection (c), the enterprise may not issue any 

3 debt security, obligation, or instrument pursuant to such 

4 approval before the expiration of the 7-day period begin5 ning upon submission of such notice of approval to the 

6 Congress.’’. 

Æ 


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