II 

Calendar No. 121 

110TH CONGRESS 

2D SESSION S. 3688 

To provide for additional emergency unemployment compensation, to amend 

the Emergency Economic Stabilization Act of 2008 to authorize loans 

to automobile manufacturers and component suppliers, and for other 

purposes. 

IN THE SENATE OF THE UNITED STATES 

NOVEMBER 17 (legislative day, SEPTEMBER 17), 2008 

Mr. REID introduced the following bill; which was read the first time 

NOVEMBER 18, 2008 

Read the second time and placed on the calendar under authority of the order 

of the Senate of November 17 (legislative day, September 17), 2008 

A BILL 

To provide for additional emergency unemployment compensation, to amend the Emergency Economic Stabilization Act of 2008 to authorize loans to automobile manufacturers and component suppliers, 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, 


hsrobinson on PROD1PC76 with BILLS
2 

•S 3688 PCS

1 TITLE I—UNEMPLOYMENT 

2 COMPENSATION 

3 SEC. 101. SHORT TITLE. 

4 This title may be cited as the ‘‘Unemployment Com5 pensation Extension Act of 2008’’. 

6 SEC. 102. ADDITIONAL FIRST-TIER BENEFITS. 

7 Section 4002(b)(1) of the Supplemental Appropria8 tions Act, 2008 (26 U.S.C. 3304 note) is amended— 

9 (1) in subparagraph (A), by striking ‘‘50’’ and 

10 inserting ‘‘80’’; and 

11 (2) in subparagraph (B), by striking ‘‘13’’ and 

12 inserting ‘‘20’’. 

13 SEC. 103. SECOND-TIER BENEFITS. 

14 Section 4002 of the Supplemental Appropriations 

15 Act, 2008 (26 U.S.C. 3304 note) is amended by adding 

16 at the end the following: 

17 ‘‘(c) SPECIAL RULE.— 

18 ‘‘(1) IN GENERAL.—If, at the time that the 

19 amount established in an individual’s account under 

20 subsection (b)(1) is exhausted or at any time there21 after, such individual’s State is in an extended ben22 efit period (as determined under paragraph (2)), 

23 such account shall be augmented by an amount 

24 equal to the lesser of— 


hsrobinson on PROD1PC76 with BILLS
3 

•S 3688 PCS

1 ‘‘(A) 50 percent of the total amount of 

2 regular compensation (including dependents’ al3 lowances) payable to the individual during the 

4 individual’s benefit year under the State law, or 

5 ‘‘(B) 13 times the individual’s average 

6 weekly benefit amount (as determined under 

7 subsection (b)(2)) for the benefit year. 

8 ‘‘(2) EXTENDED BENEFIT PERIOD.—For pur9 poses of paragraph (1), a State shall be considered 

10 to be in an extended benefit period, as of any given 

11 time, if— 

12 ‘‘(A) such a period is then in effect for 

13 such State under the Federal-State Extended 

14 Unemployment Compensation Act of 1970; 

15 ‘‘(B) such a period would then be in effect 

16 for such State under such Act if section 203(d) 

17 of such Act— 

18 ‘‘(i) were applied by substituting ‘4’ 

19 for ‘5’ each place it appears; and 

20 ‘‘(ii) did not include the requirement 

21 under paragraph (1)(A) thereof; or 

22 ‘‘(C) such a period would then be in effect 

23 for such State under such Act if— 

24 ‘‘(i) section 203(f) of such Act were 

25 applied to such State (regardless of whethVerDate Aug 31 2005 21:47 Nov 18, 2008 Jkt 079200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3688.PCS S3688

hsrobinson on PROD1PC76 with BILLS
4 

•S 3688 PCS

1 er the State by law had provided for such 

2 application); and 

3 ‘‘(ii) such section 203(f)— 

4 ‘‘(I) were applied by substituting 

5 ‘6.0’ for ‘6.5’ in paragraph (1)(A)(i) 

6 thereof; and 

7 ‘‘(II) did not include the require8 ment under paragraph (1)(A)(ii) 

9 thereof. 

10 ‘‘(3) LIMITATION.—The account of an indi11 vidual may be augmented not more than once under 

12 this subsection.’’. 

13 SEC. 104. PHASEOUT PROVISIONS. 

14 Section 4007(b) of the Supplemental Appropriations 

15 Act, 2008 (26 U.S.C. 3304 note) is amended— 

16 (1) in paragraph (1), by striking ‘‘paragraph 

17 (2),’’ and inserting ‘‘paragraphs (2) and (3),’’; and 

18 (2) by striking paragraph (2) and inserting the 

19 following: 

20 ‘‘(2) NO AUGMENTATION AFTER MARCH 31, 

21 2009.—If the amount established in an individual’s 

22 account under subsection (b)(1) is exhausted after 

23 March 31, 2009, then section 4002(c) shall not 

24 apply and such account shall not be augmented 

25 under such section, regardless of whether such indiVerDate Aug 31 2005 21:47 Nov 18, 2008 Jkt 079200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S3688.PCS S3688

hsrobinson on PROD1PC76 with BILLS
5 

•S 3688 PCS

1 vidual’s State is in an extended benefit period (as 

2 determined under paragraph (2) of such section). 

3 ‘‘(3) TERMINATION.—No compensation under 

4 this title shall be payable for any week beginning 

5 after August 27, 2009.’’. 

6 SEC. 105. TEMPORARY FEDERAL MATCHING FOR THE 

7 FIRST WEEK OF EXTENDED BENEFITS FOR 

8 STATES WITH NO WAITING WEEK. 

9 With respect to weeks of unemployment beginning 

10 after the date of the enactment of this Act and ending 

11 on or before December 8, 2009, subparagraph (B) of sec12 tion 204(a)(2) of the Federal-State Extended Unemploy13 ment Compensation Act of 1970 (26 U.S.C. 3304 note) 

14 shall not apply. 

15 SEC. 106. EFFECTIVE DATE. 

16 (a) IN GENERAL.—The amendments made by sec17 tions 102, 103, and 104 shall apply as if included in the 

18 enactment of the Supplemental Appropriations Act, 2008, 

19 subject to subsection (b). 

20 (b) ADDITIONAL BENEFITS.—In applying the amend21 ments made by sections 102 and 103, any additional emer22 gency unemployment compensation made payable by such 

23 amendments (which would not otherwise have been pay24 able if such amendments had not been enacted) shall be 

25 payable only with respect to any week of unemployment 


hsrobinson on PROD1PC76 with BILLS
6 

•S 3688 PCS

1 beginning on or after the date of the enactment of this 

2 Act. 

3 TITLE II—AUTOMOBILE INDUS4 TRY EMERGENCY ASSIST5 ANCE 

6 SEC. 201. DIRECT BRIDGE LOANS TO MANUFACTURERS 

7 AND SUPPLIERS. 

8 (a) IN GENERAL.—The Emergency Economic Sta9 bilization Act of 2008 (division A of Public Law 110–343) 

10 is amended by adding at the end the following: 

11 ‘‘TITLE IV—DIRECT BRIDGE 

12 LOAN PROVISIONS 

13 ‘‘SEC. 401. FINDINGS. 

14 ‘‘Congress finds that extraordinary and exigent cir15 cumstances have prevented the automobile industry from 

16 securing essential credit and liquidity from other sources 

17 and that the failure of the automobile industry to obtain 

18 such credit and liquidity will have a systemic adverse ef19 fect on the economy. 

20 ‘‘SEC. 402. PURPOSES. 

21 ‘‘The purposes of this title are— 

22 ‘‘(1) to clarify that authority and facilities are 

23 available to be used immediately by the Secretary to 

24 restore liquidity and stability to the automobile in25 dustry in the United States; 


hsrobinson on PROD1PC76 with BILLS
7 

•S 3688 PCS

1 ‘‘(2) to ensure that such authority and such fa2 cilities are used in a manner that— 

3 ‘‘(A) stimulates manufacturing and sales 

4 of automobiles produced by automobile manu5 facturers in the United States; 

6 ‘‘(B) enhances the ability and the capacity 

7 of the domestic automobile industry to pursue 

8 the timely and aggressive production of energy9 efficient advanced technology vehicles; 

10 ‘‘(C) preserves and promotes the jobs of 

11 355,000 workers in the United States directly 

12 employed by the automobile industry and an 

13 additional 4,500,000 workers in the United 

14 States employed in related industries; and 

15 ‘‘(D) safeguards the ability of the domestic 

16 automobile industry to provide retirement and 

17 health care benefits for 1,000,000 retirees and 

18 their spouses and dependents; and 

19 ‘‘(3) to reaffirm the purposes of section 2, 

20 which include providing the Secretary with broad au21 thority to restore liquidity and stability to financial 

22 institutions, including automobile finance companies. 

23 ‘‘SEC. 403. EMERGENCY DIRECT LOAN PROGRAM. 

24 ‘‘(a) IN GENERAL.—The Secretary shall make loans 

25 in an aggregate amount equal to $25,000,000,000, to 


hsrobinson on PROD1PC76 with BILLS
8 

•S 3688 PCS

1 automobile manufacturers and component suppliers that 

2 have— 

3 ‘‘(1) submitted an application for a loan under 

4 this title that includes a statement of need for Gov5 ernment funding under this title to prevent a sys6 temic adverse effect on the United States economy; 

7 ‘‘(2) operated a manufacturing facility for the 

8 purposes of producing automobiles or automobile 

9 components in the United States throughout the 20- 

10 year period ending on the date of enactment of this 

11 title; and 

12 ‘‘(3) operations in the United States the failure 

13 of which would have a systemic adverse effect on the 

14 overall United States economy, as determined by the 

15 Secretary. 

16 ‘‘(b) ALLOCATION.—In allocating loan amounts 

17 under this title, the Secretary shall prioritize the distribu18 tion of loans under this section based on the magnitude 

19 of the impact of the manufacturing operations of the ap20 plicant in the United States on the overall economy of the 

21 United States and other segments of the automobile in22 dustry, including the impact on levels of employment, do23 mestic manufacturing of automobiles and automobile com24 ponents, and automobile dealerships. 


hsrobinson on PROD1PC76 with BILLS
9 

•S 3688 PCS

1 ‘‘(c) PLAN FOR LONG-TERM FINANCIAL VIABIL2 ITY.—At the time of application for a loan under this title, 

3 an automobile manufacturer or component supplier shall 

4 submit to the Secretary a detailed plan on how the Gov5 ernment funds requested will be utilized to ensure the 

6 long-term financial posture of the company, and how such 

7 funds will stimulate automobile production in the United 

8 States and improve the capacity of the company to pursue 

9 the timely and aggressive production of energy-efficient 

10 advanced technology vehicles. 

11 ‘‘SEC. 404. FUNDING FROM THIRD TRANCHE; TREATMENT 

12 OF LOAN AMOUNTS. 

13 ‘‘The costs incurred by the Federal Government in 

14 making loans under this title, including credit subsidy 

15 costs and administrative expenses, shall be covered out of 

16 the funds made available to the Secretary generally under 

17 section 118 and, specifically, not from funds which are de18 scribed in paragraph (1) or (2) of section 115(a), but with 

19 respect to the availability of which the reporting and pro20 cedural requirements contained in paragraph (3) of such 

21 section and section 115(c) shall not apply. 

22 ‘‘SEC. 405. TIMING OF DISBURSEMENTS. 

23 ‘‘(a) APPLICATIONS.—On and after the date that is 

24 3 days after the date of enactment of this title, the Sec25 retary shall accept applications for loans under this title. 


hsrobinson on PROD1PC76 with BILLS
10 

•S 3688 PCS

1 ‘‘(b) DETERMINATION OF ELIGIBILITY.—Not later 

2 than 15 days after the date on which the Secretary re3 ceives an application for a loan under subsection (a), the 

4 Secretary shall make a determination regarding the eligi5 bility of the applicant, based on whether the applicant 

6 meets the requirements of section 403(a). 

7 ‘‘(c) DISBURSEMENT.—The Secretary shall begin dis8 bursement of the proceeds of a loan under this title to 

9 an eligible applicant not later than 7 days after the date 

10 on which the Secretary receives a disbursal request from 

11 the applicant, upon a determination of the Secretary that 

12 the applicant is eligible under subsection (b). 

13 ‘‘SEC. 406. TERMS AND CONDITIONS. 

14 ‘‘(a) TERM TO MATURITY.—The term to maturity of 

15 any loan made under this title shall be 10 years, or such 

16 longer period as the Secretary may determine with respect 

17 to such loan. 

18 ‘‘(b) RATE OF INTEREST.—The annual rate of inter19 est for a loan under this title shall be— 

20 ‘‘(1) 5 percent during the 5-year period begin21 ning on the date on which the Secretary disburses 

22 the loan; and 

23 ‘‘(2) 9 percent after the end of the period de24 scribed in paragraph (1). 


hsrobinson on PROD1PC76 with BILLS
11 

•S 3688 PCS

1 ‘‘(c) WARRANTS AND DEBT INSTRUMENTS.—The 

2 Secretary may not make a loan under this title unless the 

3 Secretary receives from the automobile manufacturer or 

4 component supplier a warrant or senior debt instrument 

5 made in accordance with the requirements for a warrant 

6 or senior debt instrument by a financial institution under 

7 section 113(d). 

8 ‘‘(d) NO PREPAYMENT PENALTY.—A loan made 

9 under this title shall be prepayable without penalty at any 

10 time. 

11 ‘‘(e) EXECUTIVE COMPENSATION.— 

12 ‘‘(1) STANDARDS REQUIRED.—The Secretary 

13 shall require any recipient of a loan under this title 

14 to meet appropriate standards for executive com15 pensation and corporate governance. 

16 ‘‘(2) SPECIFIC REQUIREMENTS.—The standards 

17 established under paragraph (1) shall include the 

18 following: 

19 ‘‘(A) Limits on compensation that exclude 

20 incentives for senior executive officers of a re21 cipient of a loan under this title to take unnec22 essary and excessive risks that threaten the 

23 value of such recipient during the period that 

24 the loan is outstanding. 


hsrobinson on PROD1PC76 with BILLS
12 

•S 3688 PCS

1 ‘‘(B) A provision for the recovery by such 

2 recipient of any bonus or incentive compensa3 tion paid to a senior executive officer based on 

4 statements of earnings, gains, or other criteria 

5 that are later found to be materially inaccurate. 

6 ‘‘(C) A prohibition on such recipient mak7 ing any golden parachute payment to a senior 

8 executive officer during the period that the loan 

9 under this title is outstanding. 

10 ‘‘(D) A prohibition on such recipient pay11 ing or accruing any bonus or incentive com12 pensation during the period that the loan is 

13 outstanding to any executive whose annual base 

14 compensation exceeds $250,000 (which amount 

15 shall be adjusted by the Secretary for inflation). 

16 ‘‘(E) A prohibition on any compensation 

17 plan that could encourage manipulation of the 

18 reported earnings of the recipient to enhance 

19 the compensation of any of its employees. 

20 ‘‘(3) DEFINITIONS.—For purposes of this sub21 section, the following definitions shall apply: 

22 ‘‘(A) SENIOR EXECUTIVE OFFICER.—The 

23 term ‘senior executive officer’ means an indi24 vidual who is 1 of the top 5 most highly paid 

25 executives of a public company, whose comVerDate Aug 31 2005 21:47 Nov 18, 2008 Jkt 079200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S3688.PCS S3688

hsrobinson on PROD1PC76 with BILLS
13 

•S 3688 PCS

1 pensation is required to be disclosed pursuant 

2 to the Securities Exchange Act of 1934, and 

3 any regulations issued thereunder, and non4 public company counterparts. 

5 ‘‘(B) GOLDEN PARACHUTE PAYMENT.— 

6 The term ‘golden parachute payment’ means 

7 any payment to a senior executive officer for 

8 departure from a company for any reason. 

9 ‘‘(f) PROHIBITION ON PAYMENT OF DIVIDENDS.—No 

10 common stock dividends may be paid by any recipient of 

11 a loan under this title for the duration of the loan. 

12 ‘‘SEC. 407. OVERSIGHT. 

13 ‘‘(a) IN GENERAL.—The provisions of sections 105, 

14 116, 121, and 125 shall apply with respect to any loans 

15 made under this title, to the extent possible, in the same 

16 manner and to the same extent as such sections apply to 

17 transactions made under the authority of title I.’’. 

18 (b) TECHNICAL AND CONFORMING AMENDMENTS.— 

19 (1) TABLE OF CONTENTS.—The table of con20 tents in section 1(b) of the Emergency Economic 

21 Stabilization Act of 2008 (division A of Public Law 

22 110–343) is amended— 

23 (A) by inserting after the item relating to 

24 section 3 the following new item: 

‘‘Sec. 4. References.’’ 

25 ; and 


hsrobinson on PROD1PC76 with BILLS
14 

•S 3688 PCS

1 (B) by adding at the end the following: 

‘‘TITLE IV—DIRECT BRIDGE LOAN PROVISIONS 

‘‘Sec. 401. Findings. 

‘‘Sec. 402. Purposes. 

‘‘Sec. 403. Emergency direct loan program. 

‘‘Sec. 404. Funding from third tranche; treatment of loan amounts. 

‘‘Sec. 405. Timing of disbursements. 

‘‘Sec. 406. Terms and conditions. 

‘‘Sec. 407. Oversight.’’ 

2 ; and 

3 (2) REFERENCES.—The Emergency Economic 

4 Stabilization Act of 2008 (division A of Public Law 

5 110–343) is amended by inserting after section 3 

6 the following new section: 

7 ‘‘SEC. 4. REFERENCES. 

8 ‘‘Any reference— 

9 ‘‘(1) in this division to ‘this Act’ or any subdivi10 sion thereof is a reference to this division A or any 

11 subdivision thereof; 

12 ‘‘(2) in division (B) to ‘this Act’ or any subdivi13 sion thereof is a reference to division B or any sub14 division thereof; and 

15 ‘‘(3) in division (C) to ‘this Act’ or any subdivi16 sion thereof is a reference to division C or any sub17 division thereof.’’. 


hsrobinson on PROD1PC76 with BILLS
15 

•S 3688 PCS

1 TITLE III—EMERGENCY 

2 TREATMENT 

3 SEC. 301. EMERGENCY TREATMENT. 

4 All provisions of this Act and the amendments made 

5 by this Act are designated as an emergency requirement 

6 and necessary to meet emergency needs pursuant to sec7 tion 204(a) of S. Con. Res 21 (110th Congress), the con8 current resolution on the budget for fiscal year 2008. 


hsrobinson on PROD1PC76 with BILLS
Calendar No. 121 

110TH CONGRESS 

2D SESSION S. 3688 

A BILL 

To provide for additional emergency unemployment 

nent suppliers, and for other purposes. loans to automobile manufacturers and componomic Stabilization Act of 2008 to authorize compensation, to amend the Emergency EcoNOVEMBER 18, 2008 

Read the second time and placed on the calendar 


hsrobinson on PROD1PC76 with BILLS