H. R. 1664
One Hundred Sixth Congress
of the
United States of America
AT THE FIRST SESSION
Begun and held at the City of Washington on Wednesday,
the sixth day of January, one thousand nine hundred and ninety-nine
An Act
Providing emergency authority for guarantees of loans to qualified steel and iron
ore companies and to qualified oil and gas companies, and for other purposes.
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled, That the
following sums are appropriated, out of any money in the Treasury
not otherwise appropriated, for the fiscal year ending September
30, 1999, and for other purposes, namely:
CHAPTER 1
SEC. 101. EMERGENCY STEEL LOAN GUARANTEE PROGRAM. (a)
SHORT TITLE.—This chapter may be cited as the ‘‘Emergency Steel
Loan Guarantee Act of 1999’’.
(b) CONGRESSIONAL FINDINGS.—Congress finds that—
(1) the United States steel industry has been severely
harmed by a record surge of more than 40,000,000 tons of
steel imports into the United States in 1998, caused by the
world financial crisis;
(2) this surge in imports resulted in the loss of more than
10,000 steel worker jobs in 1998, and was the imminent cause
of three bankruptcies by medium-sized steel companies, Acme
Steel, Laclede Steel, and Geneva Steel;
(3) the crisis also forced almost all United States steel
companies into—
(A) reduced volume, lower prices, and financial losses;
and
(B) an inability to obtain credit for continued
operations and reinvestment in facilities;
(4) the crisis also has affected the willingness of private
banks and investment institutions to make loans to the United
States steel industry for continued operation and reinvestment
in facilities;
(5) these steel bankruptcies, job losses, and financial losses
are also having serious negative effects on the tax base of
cities, counties, and States, and on the essential health, edu-
cation, and municipal services that these government entities
provide to their citizens; and
(6) a strong steel industry is necessary to the adequate
defense preparedness of the United States in order to have
sufficient steel available to build the ships, tanks, planes, and
armaments necessary for the national defense.
(c) DEFINITIONS.—For purposes of this section:
(1) BOARD.—The term ‘‘Board’’ means the Loan Guarantee
Board established under subsection (e).
H. R. 1664—2
(2) PROGRAM.—The term ‘‘Program’’ means the Emergency
Steel Guarantee Loan Program established under subsection
(d).
(3) QUALIFIED STEEL COMPANY.—The term ‘‘qualified steel
company’’ means any company that—
(A) is incorporated under the laws of any State;
(B) is engaged in the production and manufacture of
a product defined by the American Iron and Steel Institute
as a basic steel mill product, including ingots, slab and
billets, plates, flat-rolled steel, sections and structural prod-
ucts, bars, rail type products, pipe and tube, and wire
rod; and
(C) has experienced layoffs, production losses, or
financial losses since the beginning of the steel import
crisis, in January 1998 or that operates substantial assets
of a company that meets these qualifications.
(d) ESTABLISHMENT OF EMERGENCY STEEL GUARANTEE LOAN
PROGRAM.—There is established the Emergency Steel Guarantee
Loan Program, to be administered by the Board, the purpose of
which is to provide loan guarantees to qualified steel companies
in accordance with this section.
(e) 
LOAN
GUARANTEE
BOARD
MEMBERSHIP.—There 
is
established a Loan Guarantee Board, which shall be composed
of—
(1) the Secretary of Commerce;
(2) the Chairman of the Board of Governors of the Federal
Reserve System, who shall serve as Chairman of the Board;
and
(3) the Chairman of the Securities and Exchange
Commission.
(f ) LOAN GUARANTEE PROGRAM.—
(1) AUTHORITY.—The Program may guarantee loans pro-
vided to qualified steel companies by private banking and
investment institutions in accordance with the procedures,
rules, and regulations established by the Board.
(2) TOTAL
GUARANTEE
LIMIT.—The aggregate amount of
loans guaranteed and outstanding at any one time under this
section may not exceed $1,000,000,000.
(3) INDIVIDUAL GUARANTEE LIMIT.—The aggregate amount
of loans guaranteed under this section with respect to a single
qualified steel company may not exceed $250,000,000.
(4) TIMELINES.—The Board shall approve or deny each
application for a guarantee under this section as soon as pos-
sible after receipt of such application.
(5) ADDITIONAL COSTS.—For the additional cost of the loans
guaranteed under this subsection, including the costs of modi-
fying the loans as defined in section 502 of the Congressional
Budget Act of 1974 (2 U.S.C. 661a), there is appropriated
$140,000,000 to remain available until expended.
(g) REQUIREMENTS FOR LOAN GUARANTEES.—A loan guarantee
may be issued under this section upon application to the Board
by a qualified steel company pursuant to an agreement to provide
a loan to that qualified steel company by a private bank or invest-
ment company, if the Board determines that—
(1) credit is not otherwise available to that company under
reasonable terms or conditions sufficient to meet its financing
H. R. 1664—3
needs, as reflected in the financial and business plans of that
company;
(2) the prospective earning power of that company, together
with the character and value of the security pledged, furnish
reasonable assurance of repayment of the loan to be guaranteed
in accordance with its terms;
(3) the loan to be guaranteed bears interest at a rate
determined by the Board to be reasonable, taking into account
the current average yield on outstanding obligations of the
United States with remaining periods of maturity comparable
to the maturity of such loan;
(4) the company has agreed to an audit by the General
Accounting Office prior to the issuance of the loan guarantee
and annually thereafter while any such guaranteed loan is
outstanding; and
(5) in the case of a purchaser of substantial assets of
a qualified steel company, the qualified steel company estab-
lishes that it is unable to reorganize itself.
(h) TERMS AND CONDITIONS OF LOAN GUARANTEES.—
(1) LOAN DURATION.—All loans guaranteed under this sec-
tion shall be payable in full not later than December 31, 2005,
and the terms and conditions of each such loan shall provide
that the loan may not be amended, or any provision thereof
waived, without the consent of the Board.
(2) LOAN SECURITY.—Any commitment to issue a loan guar-
antee under this section shall contain such affirmative and
negative covenants and other protective provisions that the
Board determines are appropriate. The Board shall require
security for the loans to be guaranteed under this section
at the time at which the commitment is made.
(3) FEES.—A qualified steel company receiving a guarantee
under this section shall pay a fee to the Department of the
Treasury to cover costs of the program, but in no event shall
such fee exceed an amount equal to 0.5 percent of the out-
standing principal balance of the guaranteed loan.
(4) GUARANTEE LEVEL.—No loan guarantee may be provided
under this section if the guarantee exceeds 85 percent of the
amount of principal of the loan.
(i) REPORTS TO CONGRESS.—The Secretary of Commerce shall
submit to Congress a full report of the activities of the Board
under this section during each of fiscal years 1999 and 2000, and
annually thereafter, during such period as any loan guaranteed
under this section is outstanding.
( j) SALARIES AND ADMINISTRATIVE EXPENSES.—For necessary
expenses to administer the Program, $5,000,000 is appropriated
to the Department of Commerce, to remain available until expended,
which may be transferred to the Office of the Assistant Secretary
for Trade Development of the International Trade Administration.
(k) TERMINATION OF GUARANTEE AUTHORITY.—The authority
of the Board to make commitments to guarantee any loan under
this section shall terminate on December 31, 2001.
(l) REGULATORY ACTION.—The Board shall issue such final
procedures, rules, and regulations as may be necessary to carry
out this section not later than 60 days after the date of the enact-
ment of this Act.
(m) IRON ORE COMPANIES.—
H. R. 1664—4
(1) IN GENERAL.—Subject to the requirements of this sub-
section, an iron ore company incorporated under the laws of
any State shall be treated as a qualified steel company for
purposes of the Program.
(2) TOTAL
GUARANTEE
LIMIT
FOR
IRON
ORE
COMPANY.—
Of the aggregate amount of loans authorized to be guaranteed
and outstanding at any one time under subsection (f )(2), an
amount not to exceed $30,000,000 shall be loans with respect
to iron ore companies.
FEDERAL ADMINISTRATIVE AND TRAVEL EXPENSES
(RESCISSIONS)
SEC. 102. (a) Of the funds available in the nondefense category
to the agencies of the Federal Government, $145,000,000 are hereby
rescinded: Provided, That rescissions pursuant to this subsection
shall be taken only from administrative and travel accounts: Pro-
vided further, That rescissions shall be taken on a pro rata basis
from funds available to every Federal agency, department, and
office in the executive branch, including the Office of the President.
(b) Within 30 days after the date of the enactment of this
Act, the Director of the Office of Management and Budget shall
submit to the Committees on Appropriations of the House of Rep-
resentatives and the Senate a listing of the amounts by account
of the reductions made pursuant to the provisions of subsection
(a) of this section.
CHAPTER 2
SEC. 201. PETROLEUM DEVELOPMENT MANAGEMENT. (a) SHORT
TITLE.—This chapter may be cited as the ‘‘Emergency Oil and
Gas Guaranteed Loan Program Act’’.
(b) FINDINGS.—Congress finds that—
(1) consumption of foreign oil in the United States is
estimated to equal 56 percent of all oil consumed, and that
percentage could reach 68 percent by 2010 if current prices
prevail;
(2) the number of oil and gas rigs operating in the United
States is at its lowest since 1944, when records of this tally
began;
(3) if prices do not increase soon, the United States could
lose at least half its marginal wells, which in aggregate produce
as much oil as the United States imports from Saudi Arabia;
(4) oil and gas prices are unlikely to increase for at least
several years;
(5) declining production, well abandonment, and greatly
reduced exploration and development are shrinking the
domestic oil and gas industry;
(6) the world’s richest oil producing regions in the Middle
East are experiencing increasingly greater political instability;
(7) United Nations policy may make Iraq the swing oil
producing nation, thereby granting Saddam Hussein tremen-
dous power;
(8) reliance on foreign oil for more than 60 percent of
our daily oil and gas consumption is a national security threat;