To establish the United States Territories Infrastructure Bond Bank, and for other purposes.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``United States Territories 
Infrastructure Bond Bank Authorization Act''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Bank.--The term ``Bank'' means the United States 
        Territories Infrastructure Bond Bank.
            (2) Board.--The term ``Board'' means the Board of Directors 
        of the United States Territories Infrastructure Bond Bank.
            (3) Debt instruments.--The term ``debt instruments'' means 
        bonds or notes issued by the Bank under authority granted in 
        this Act.
            (4) Infrastructure.--The term ``infrastructure'' means 
        those facilities that are essential for public health, welfare, 
        and safety, such as sewage treatment facilities, municipal 
        water supply and treatment facilities, solid waste facilities, 
        public safety equipment and facilities, roads, traffic control 
        devices and other transportation facilities, sidewalks, buried 
        utility lines and other streetscape improvements, parks and 
        other open space or recreational areas.
            (5) Territorial customer.--The term ``territorial 
        customer'' means any of the governments of the United States 
        territories of American Samoa, Guam, the United States Virgin 
        Islands, or the Commonwealth of the Northern Mariana Islands, 
        or such other territory as shall become eligible in accordance 
        with the provisions of section 14.
            (6) Territory.--The term ``territory'' means a territory of 
        the United States.
            (7) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior.

SEC. 3. ESTABLISHMENT.

    (a) In General.--The Secretary shall establish, in accordance with 
this Act, a body corporate and politic, with corporate succession, to 
be known as the ``United States Territories Infrastructure Bond Bank''. 
The Bank shall not be an agency or instrumentality of the Federal 
Government, and an officer, employee, or member of the board of the 
Bank shall not be deemed to be an officer or employee of or agent for 
the Federal Government by reason of such service.
    (b) Purpose.--The purpose of the Bank shall be to provide low-cost 
financing for any territorial customer to construct infrastructure or 
refinance debt that was acquired to construct infrastructure.
    (c) Essential Governmental Function.--The Bank shall be an entity 
exercising public and essential governmental functions, and the 
exercise by the Bank of the powers conferred by this Act is deemed to 
be an essential governmental function of the territories.
    (d) Incorporation of Bank.--The Secretary shall--
            (1) incorporate the Bank in a jurisdiction of the United 
        States, under the laws of that jurisdiction, after consultation 
        with the governors of the territories; and
            (2) organize the initial meeting of the Board of Directors.

SEC. 4. BOARD OF DIRECTORS.

    (a) In General.--Except as provided in section 14, the Bank shall 
be governed by a Board of Directors consisting of 5 members as follows: 
one appointed by the Secretary, and one each appointed by the governors 
of American Samoa, Guam, the United States Virgin Islands, and the 
Commonwealth of the Northern Mariana Islands.
    (b) Residency.--A director from a territory shall be a resident of 
the territory from which the director was appointed.
    (c) Term of Office; Vacancy; Removal.--Directors shall serve for a 
term of 4 years, except that the terms of the members of the initial 
board shall terminate in a uniformly staggered fashion over the first 4 
years of the Bank's existence as determined by the Secretary. A 
director may be reappointed. Any vacancy occurring other than by the 
expiration of a term shall be filled by appointment for the unexpired 
term. The Secretary may remove a director from office for cause after a 
public hearing. The Secretary may suspend a director pending the 
completion of this hearing.
    (d) Election of Chairman.--The Board shall elect a chairman by a 
simple majority from among the Board's members.
    (e) Oath of Office.--Each director shall--
            (1) take and subscribe an oath, upon entering office, to 
        perform the duties of his office faithfully, impartially and 
        justly to the best of his ability, with a record of the oath to 
        be filed with the records of the Bank;
            (2) submit a report of the director's personal investment 
        holdings and if the Secretary determines that such holdings 
        conflict with the purposes of this Act, the director must 
        divest himself of such holdings, or vacate the position; and
            (3) execute a surety bond as required in section 12.
    (f) Compensation.--All directors shall be reimbursed for reasonable 
expenses incurred in carrying out their duties under this Act.

SEC. 5. PROFESSIONAL STAFF.

    (a) Appointment of President by Board.--The Board shall appoint a 
President who shall serve at the pleasure of the Board, and, subject to 
the authority of the Board, shall exercise general supervision, 
direction, and control of the affairs of the Bank. The Board of 
Directors shall determine the duties and compensation of the President.
    (b) Employees.--The President may employ a general counsel, 
architects, engineers, accountants, attorneys, financial advisors or 
experts and any other agents or employees who are required and 
determine their qualifications, terms of office, duties and 
compensation.

SEC. 6. BANK AUTHORITY AND PROHIBITIONS.

    (a) Authority To Issue General Obligations, Bonds, or Notes.--The 
Bank may issue general obligations, bonds, or notes in such principal 
amounts as the Board deems necessary to provide funds for any purpose 
authorized in this Act, including--
            (1) making loans;
            (2) paying, funding, or refunding of the principal of, or 
        interest or redemption premiums on, any bonds or notes issued 
        by it whether the bonds or notes or interest to be funded or 
        refunded have or have not become due;
            (3) establishing or increasing of reserves to secure or to 
        pay bonds or notes or interest thereon, and
            (4) paying all other costs or expenses of the Bank, during 
        the initial 2 years of operation, that are incident to carrying 
        out the Bank's purposes and powers.
    (b) General Powers.--The Bank may exercise the general powers of a 
bond bank, such as the power to--
            (1) sue and be sued;
            (2) adopt an official seal and alter the seal at pleasure;
            (3) adopt bylaws and make and enforce rules for the conduct 
        of its business and for use of its services and facilities;
            (4) maintain an office at any place within the United 
        States;
            (5) acquire, hold, use and dispose of its income, revenues, 
        funds and moneys;
            (6) acquire, rent, lease, hold, use and dispose of other 
        personal property for its purposes;
            (7) borrow money and issue its negotiable general 
        obligation debt instruments payable from revenues or funds of 
        the Bank, subject only to agreements with the holders of 
        particular bonds or notes pledging particular revenues or 
        funds, and to provide for and secure the payment thereof and to 
        provide for the rights of the holders thereof, and to purchase, 
        hold and dispose of any of its debt instruments; Except as 
        otherwise provided herein or by the Bank, every issue of bonds 
        or notes shall be general obligations;
            (8) obtain additional security for bonds or notes by a 
        pledge of any grant or contributions from the United States, a 
        State or territory, or any other governmental unit, or any 
        person, firm or corporation, or a pledge of any income or 
        revenues, funds or moneys of the Bank from any source 
        whatsoever;
            (9) fix and revise from time to time and charge and collect 
        fees and charges for the use of its services or facilities;
            (10) accept gifts or grants of property, funds, money, 
        materials, labor, supplies or services from the United States 
        of America or from any governmental unit or any person, firm or 
        corporation, and carry out the terms or provisions or make 
        agreements with respect to any gifts or grants, and to do any 
        and all things necessary and appropriate in connection with 
        procuring, acceptance or disposition of gifts or grants;
            (11) do anything authorized by this Act, through its 
        officers, agents or employees or by contracts with any person, 
        firm or corporation;
            (12) enter into and enforce all contracts necessary and 
        appropriate for the purposes of the Bank or pertaining to any 
        loan to a governmental unit or any purchase or sale of 
        municipal bonds or revenue bonds or other investments or to the 
        performance of its duties and execution or carrying out of any 
        of its powers under this Act;
            (13) purchase or hold municipal bonds and revenue bonds at 
        such prices and in such manner as the Bank deems advisable, and 
        sell municipal bonds and revenue bonds acquired or held by it 
        at such prices without relation to cost and in such manner as 
        the Bank deems advisable;
            (14) invest any funds or moneys of the Bank not immediately 
        required for loan to governmental units and for the purchase of 
        municipal bonds or revenue bonds, in the same manner as 
        permitted for investment of funds belonging to the territories 
        or held in the treasury, except as otherwise provided by this 
        Act;
            (15) prescribe any form of application or procedure 
        required of a governmental unit for the loan or purchase of its 
        municipal bonds or revenue bonds, fix the terms and conditions 
        of that loan or purchase, and enter into agreements with 
        governmental units with respect to any loan or purchase;
            (16) consider the need, desirability or eligibility of the 
        loan to a territorial customer, the ability of the territorial 
        customer to secure borrowed money from other sources and the 
        costs thereof, and the particular public improvement or purpose 
        to be financed by the municipal bonds or revenue bonds to be 
        purchased by the Bank;
            (17) charge for its costs and services in review or 
        consideration of any proposed loan to a territorial customer or 
        purchase of municipal bonds or revenue bonds of a territorial 
        customer, including a charge for such costs or services, 
        whether or not the loan is made or the municipal bonds or 
        revenue bonds are purchased;
            (18) establish any terms and provisions with respect to any 
        purchase of municipal bonds or revenue bonds by the Bank, 
        including date and maturities of the bonds, provisions as to 
        redemption or payment prior to maturity, and any other matters 
        which are necessary or advisable in the judgment of the Bank;
            (19) conduct examinations and hearings and to hear 
        testimony and take proof, under oath or affirmation, at public 
        or private hearings, on any matter material for its information 
        and necessary to carry out this Act;
            (20) issue subpoenas requiring the attendance of witnesses 
        and the production of books and papers pertinent to any hearing 
        before the Bank, or before one or more of the directors of the 
        Bank appointed by it to conduct the hearing;
            (21) apply to any court, having territorial jurisdiction of 
        the offense, to have punished for contempt any witness who 
        refuses to obey a subpoena, or who refuses to be sworn or 
        affirmed to testify, or who is guilty of any contempt after 
        summons to appear;
            (22) procure insurance against any losses in connection 
        with its property, operations or assets in such amounts and 
        from such insurers as it deems desirable;
            (23) consent, to the extent permitted under its contracts 
        with the holders of bonds or notes of the Bank, to any 
        modification of the rate of interest, time and payment of any 
        installment of principal or interest, security or any other 
        term of bond or note, contract or agreement of any kind to 
        which the Bank is a party; and
            (24) issue Bank bonds or notes which are secured by neither 
        the reserve fund nor the revenue bond reserve fund, but which 
        may be secured by such other funds and accounts as may be 
        authorized by the Bank from time-to-time.
    (c) Prohibitions.--The Bank may not--
            (1) make loans of money to any person, firm or corporation 
        other than a government or a governmental agency or 
        subdivision, or purchase securities issued by any person, firm 
        or corporation other than a governmental unit or for investment 
        except as provided in this Act;
            (2) issue bills of credit, or accept deposits of money for 
        time or demand deposit, or administer trust, or engage in any 
        form or manner in, or in the conduct of, any private or 
        commercial banking business, or act as a savings bank or 
        savings and loan association;
            (3) be or constitute a bank or trust company within the 
        jurisdiction or under the control of the comptroller of the 
        currency of the United States of America or the department of 
        the treasury thereof; or
            (4) be or constitute a bank, banker or dealer in securities 
        within the meaning of or subject to the provisions of any 
        securities, securities exchange, or securities dealers law, of 
        the United States of America or of the territories or of any 
        State.

SEC. 7. BYLAWS.

    The Board shall adopt, consistent with this Act and with 
concurrence from the Secretary, an appropriate bylaws, charter or 
operating model that shall describe--
            (1) the operational structure of the Bank, including the 
        banks powers and limitation;
            (2) a description of the Bank's fund and account structure;
            (3) procedures for payments and defaults; and
            (4) minimum borrower requirements.

SEC. 8. SECURITY.

    (a) Aid Interception.--An interception of any Federal aid intended 
for a United States territory that has defaulted on an obligation to 
the Bank may be implemented, subject to the following conditions--
            (1) the Federal aid to be intercepted was explicit in the 
        debt instrument signed by the territorial customer and the 
        Bank;
            (2) the member or members of the Board appointed by the 
        Secretary agreed to the specific designation in the debt 
        instrument of sources of Federal aid that would be intercepted;
            (3) the Bank provides the Secretary with written 
        certification of the default and a request to intercept the 
        Federal Aid, and sends notice of the certification to the 
        territorial customer; and
            (4) the Bank provides notice to the Federal departments or 
        agencies administering those funds payable to the territorial 
        customer that were explicit in the debt instrument.
    (b) Directed Payment.--Following receipt of the written 
certification from the Bank provided for in subsection (a), the 
Secretary shall notify the Secretary of the Treasury of the default and 
the Federal aid to be intercepted. The Secretary of the Treasury shall 
pay the Federal aid funds that are intercepted to the Bank on the 
account of the territorial customer to defray principal and interest 
owed according the debt instrument.

SEC. 9. REPORTS.

    The Bank shall prepare and submit to each official who has 
appointed a member of the Board a report on activities of the Bank for 
the preceding calendar year, and an audit of its books and accounts by 
in independent certified public accountant, within 90 days of the end 
of the calendar year. The report and audit shall be made available by 
request to the public.

SEC. 10. UNITED STATES AND TERRITORIAL GOVERNMENTS NOT OBLIGATED.

    (a) United States Not Obligated.--The deposit of Federal funds into 
the Bank established under this Act shall not be construed as a 
commitment, guarantee, or obligation on the part of the United States 
to any third party, nor shall any third party have any right against 
the United States for payment solely by virtue of the contribution. Any 
security or debt-financing instrument issued by the infrastructure bank 
shall expressly state that the security or instrument does not 
constitute a commitment, guarantee, or obligation of the United States.
    (b) Obligations of Territorial Governments.--A territorial customer 
is liable only for its obligations to the Bank, and not for the 
obligations and actions of the Bank.

SEC. 11. LOCAL AUTHORITY.

    Prior to a territory receiving financial assistance from the Bank, 
the Governor of the territory must sign or concur in a certification 
that the territory has appropriate legal authority to avail itself of 
the financial assistance offered by the Bank.

SEC. 12. ADMINISTRATION.

    (a) Expenses.--All expenses incurred by the Bank in carrying out 
the purposes of this Act shall be payable solely from revenues or fees 
collected by the Bank, except as provided in section 6(a) of this Act.
    (b) Surety Bonds.--The following surety bonds to be paid by the 
Bank shall be required of the officials of the Bank--
            (1) $50,000 for the Chairman of the Board;
            (2) $50,000 for the President of the Bank; and
            (3) $25,000 for a member of the Board.

SEC. 13. TAX EXEMPTION.

    All activities, instruments, property, and income of the Bank shall 
be exempt from all manner of Federal, State, and local taxation.

SEC. 14. ADDITIONAL PARTICIPATION.

    (a) Extended Eligibility.--After the initial 5 years of the Bank's 
existence, the Secretary, with the concurrence of each of the Governors 
of the American Samoa, Guam, the United States Virgin Islands, and the 
Commonwealth of the Northern Mariana Islands, may invite the governor 
of another United States territory to appoint a member of the Board 
and, at such time as the new member has been appointed, extend 
eligibility to that territory for Bank services.
    (b) Voting Members.--If the number of voting members on the Board 
is an even number, the Secretary shall appoint another member.

Summary: United States Territories Infrastructure Bond Bank Authorization Act - Directs the Secretary to establish a United States Territories Infrastructure Bond Bank to provide low-cost financing for the governments of American Samoa, Guam, the U.S. Virgin Islands, and the Northern Mariana Islands to construct infrastructure or to refinance debt acquired to construct infrastructure.

Directs the Secretary to incorporate the Bank in a U.S. jurisdiction and organize the initial meeting of its Board of Directors, which shall consist of five members, with one appointed by the Secretary and each of the governors of American Samoa, Guam, the U.S. Virgin Islands, and the Northern Mariana Islands. Allows the Secretary, after the initial five years of the Bank's existence, to invite the governor of another U.S. territory to appoint a Board member, at which time eligibility for Bank services shall be extended to that territory.

Authorizes the interception of federal aid intended for a U.S. territory that has defaulted on an obligation to the Bank. Exempts Bank activities and income from taxation.