II 

115TH CONGRESS 

1ST SESSION S. 1740 

To provide guidance and priorities for Federal Government obligations in 

the event that the debt limit is reached and to provide a limited and 

temporary authority to exceed the debt limit for priority obligations. 

IN THE SENATE OF THE UNITED STATES 

AUGUST 3, 2017 

Mr. PAUL introduced the following bill; which was read twice and referred to 

the Committee on Finance 

A BILL 

To provide guidance and priorities for Federal Government 

obligations in the event that the debt limit is reached 

and to provide a limited and temporary authority to 

exceed the debt limit for priority obligations. 

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 ‘‘Default Prevention 

5 Act’’. 

6 SEC. 2. PRIORITIZING OBLIGATIONS. 

7 (a) IN GENERAL.—In the event that the debt of the 

8 Government of the United States reaches the statutory 


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•S 1740 IS

1 limit under section 3101 of title 31, United States Code, 

2 the following expenditures shall be granted priority over 

3 all other obligations incurred by the Government of the 

4 United States: 

5 (1) The authority of the Department of the 

6 Treasury provided in section 3123 of title 31, 

7 United States Code, to pay with legal tender the 

8 principal and interest on debt held by the public. 

9 (2) The full payment of compensation, allow10 ances, and benefits for members of the Armed 

11 Forces on active duty. 

12 (3) The authority of the Commissioner of Social 

13 Security to pay monthly old-age survivors’ and dis14 ability insurance benefits under title II of the Social 

15 Security Act. 

16 (4) The authority of the Secretary of Health 

17 and Human Services to make payments for items 

18 and services furnished to beneficiaries under the 

19 Medicare program under title XVIII of the Social 

20 Security Act and related provisions. 

21 (5) All obligations under any program adminis22 tered by the Department of Veterans Affairs. 

23 (b) AUTHORITY TO ISSUE ADDITIONAL DEBT FOR

24 PRIORITY OBLIGATIONS.— 


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1 (1) IN GENERAL.—The Secretary of the Treas2 ury may issue obligations subject to limit under sec3 tion 3101 of title 31, United States Code, in an 

4 amount in excess of the limit under such section— 

5 (A) during the 30-day period beginning on 

6 the date on which the United States is unable 

7 to use revenues or the extraordinary measures 

8 described in paragraph (2) to fully pay obliga9 tions of the Government of the United States 

10 described in subsection (a) at the time they are 

11 due; 

12 (B) only to the extent necessary to make 

13 timely payment on obligations of the Govern14 ment of the United States described in sub15 section (a); and 

16 (C) if the Secretary provides to Congress 

17 notice of the exercise of the authority under 

18 this subsection. 

19 (2) EXTRAORDINARY MEASURES.—The extraor20 dinary measures described in this paragraph are the 

21 following: 

22 (A) The authority under subsections (j), 

23 (k), and (l) of section 8348 of title 5, United 

24 States Code. 


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1 (B) The authority under subsections (g) 

2 and (h) of section 8438 of title 5, United States 

3 Code. 

4 (C) The suspension of investing amounts 

5 in the stabilization fund under section 

6 5302(a)(1) of title 31, United States Code. 

7 (D) The suspension of investing of 

8 amounts or the issuance of obligations for any 

9 other fund or account for purposes of pre10 venting the amount of obligations subject to 

11 limit under section 3101 of title 31, United 

12 States Code, from exceeding such limit. 

Æ 


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