I 

114TH CONGRESS 

1ST SESSION H. R. 1673 

To amend the Federal Housing Enterprises Financial Safety and Soundness 

Act of 1992 to establish a secondary reserve fund for a housing enterprise under conservatorship to protect taxpayers against loss in the 

event of a housing downturn, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 26, 2015 

Mrs. BLACKBURN introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To amend the Federal Housing Enterprises Financial Safety 

and Soundness Act of 1992 to establish a secondary 

reserve fund for a housing enterprise under conservatorship to protect taxpayers against loss in the event of 

a housing downturn, and for other purposes. 

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 ‘‘Enterprise Secondary 

5 Reserve Taxpayer Protection and Government Account6 ability Act of 2015’’. 


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1 SEC. 2. SECONDARY RESERVE. 

2 Section 1362 of the Federal Housing Enterprises Fi3 nancial Safety and Soundness Act of 1992 (12 U.S.C. 

4 4612) is amended— 

5 (1) by striking the section designation and 

6 heading and inserting the following: 

7 ‘‘SEC. 1362. MINIMUM CAPITAL LEVELS AND SECONDARY 

8 RESERVE.’’; 

9 (2) by redesignating subsections (e) and (f) as 

10 subsections (f) and (g), respectively; and 

11 (3) by inserting after subsection (d) the fol12 lowing new subsection: 

13 ‘‘(e) SECONDARY RESERVE.— 

14 ‘‘(1) ESTABLISHMENT.—Notwithstanding any 

15 other provision of law, rule, regulation, order, or 

16 agreement, the Director shall, by regulation, estab17 lish for any enterprise operating in conservatorship 

18 pursuant to section 1367 a secondary reserve fund 

19 and shall deposit in such fund from any revenues of 

20 the enterprise an amount equal to the amounts enu21 merated under subsection (a) for the enterprise. 

22 ‘‘(2) MAINTENANCE.—Amounts in the sec23 ondary reserve fund shall be held in escrow by the 

24 enterprise until— 

25 ‘‘(A) the Director uses such amounts pur26 suant to paragraph (3); or 


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1 ‘‘(B) the Director abolishes the secondary 

2 reserve fund pursuant to paragraph (4). 

3 ‘‘(3) AVAILABILITY OF AMOUNTS.—If the Di4 rector determines, in accordance with regulations 

5 issued under paragraph (5), that losses of an enter6 prise operating in conservatorship pursuant to sec7 tion 1367 will exceed amounts available for the en8 terprise under subsection (a), (c), (d), or (f), the Di9 rector shall make a determination, in accordance 

10 with such regulation, whether to use funds held in 

11 the secondary reserve for the enterprise. 

12 ‘‘(4) ABOLISHMENT.—Upon the dissolution of 

13 the conservatorship of an enterprise, the Director 

14 shall abolish any secondary reserve established under 

15 paragraph (1) for the enterprise and amounts re16 maining in such reserve upon such abolishment shall 

17 revert to meet capital requirements under sub18 sections (a), (c), (d), and (f) and then to earnings 

19 of the enterprise. 

20 ‘‘(5) REGULATIONS.—The Director shall issue 

21 regulations establishing— 

22 ‘‘(A) standards and procedures for the es23 tablishment of a secondary reserve under para24 graph (1); 


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1 ‘‘(B) standards and procedures that the 

2 Director will use to make the determinations 

3 under paragraph (3); and 

4 ‘‘(C) procedures for abolishment of a sec5 ondary reserve under paragraph (4). 

6 ‘‘(6) TREATMENT OF SECONDARY RESERVE.— 

7 Any secondary reserve established under this Act for 

8 an enterprise shall not be considered capital, a cap9 ital reserve, or otherwise an asset of the enterprise, 

10 other than as part of a capital restoration plan for 

11 the enterprise approved under section 1369C, during 

12 the pendency of a conservatorship for the enter13 prise.’’. 

14 SEC. 3. EFFECTIVE DATE. 

15 The amendments made by section 2 of this Act shall 

16 take effect upon the expiration of the 90-day period begin17 ning on the date of the enactment of this Act and the 

18 Director of the Federal Housing Finance Agency shall 

19 issue the regulations required under section 1362(e)(5) of 

20 the Federal Housing Enterprises Financial Safety and 

21 Soundness Act of 1992, added by the amendment made 

22 by such section 2, before the expiration of such period. 

Æ 


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