Full Faith and Credit Act
Bill: S.2809 | Sponsor: Sen. Scott, Rick (R-FL)
Policy area: Economics and Public Finance

Summary:
Full Faith and Credit Act
This bill requires the Department of the Treasury to prioritize certain obligations if the federal debt limit is reached and provides for a limited increase in the debt limit to fund these priorities.
If the federal government reaches the debt limit, the following obligations must be given equal priority over all other federal obligations:
If the debt limit has been reached and incoming revenue will be insufficient to pay the priority obligations over an upcoming two-week period, the bill requires (1) Treasury to notify Congress of the expected revenue shortfall for the two-week period, and (2) the debt limit to be increased by the amount of the expected shortfall.
If the incoming revenue exceeds the expected shortfall, the excess revenue must be held in reserve and applied to the following two-week period.

To protect social security benefits and military pay and require that 
the United States Government to prioritize all obligations on the debt 
    held by the public in the event that the debt limit is reached.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Full Faith and Credit Act''.

SEC. 2. PRIORITIZE OBLIGATIONS ON THE DEBT HELD BY THE PUBLIC, SOCIAL 
              SECURITY BENEFITS, MEDICARE, VETERANS, AND MILITARY PAY.

    If the debt of the United States Government reaches the statutory 
limit under section 3101 of title 31, United States Code, the following 
obligations shall take equal priority over all other obligations 
incurred by the United States Government:
            (1) The authority of the Department of the Treasury 
        provided under section 3123 of title 31, United States Code, to 
        pay with legal tender the principal and interest on debt held 
        by the public.
            (2) The authority of the Commissioner of Social Security to 
        pay monthly old-age, survivors', and disability insurance 
        benefits under title II of the Social Security Act (42 U.S.C. 
        401 et seq.).
            (3) The payment of pay and allowances for members of the 
        Armed Forces on active duty and members of the United States 
        Coast Guard.
            (4) The payment of compensation and pensions, and payments 
        for medical services, provided by the Department of Veterans 
        Affairs.
            (5) The Medicare programs under parts A, B, C, and D of 
        title XVIII of the Social Security Act (42 U.S.C. 1395c et 
        seq.).

SEC. 3. LIMITED DEBT LIMIT AUTHORITY.

    (a) In General.--If the Secretary of the Treasury determines, after 
consultation with the Director of the Office of Management and Budget, 
that incoming revenue will not be sufficient to pay the priority 
obligations specified under section 2 over an upcoming 2-week period 
during a period during which the debt of the United States Government 
has reached the statutory limit under section 3101 of title 31, United 
States Code--
            (1) the Secretary, in coordination with the Director of the 
        Office of Management and Budget, shall notify Congress of the 
        amount of the expected revenue shortfall from the revenue 
        required to pay in full the priority obligations specified 
        under section 2 for such 2-week period; and
            (2) the amount of the limit on debt held by the public 
        under section 3101 of title 31, United States Code, shall be 
        increased by the amount of the expected revenue shortfall.
    (b) Excess Revenue.--If incoming revenue exceeds the amount 
projected under subsection (a), any amount in excess shall be held in 
reserve and applied to the following 2-week period.
                                                       Calendar No. 136

117th CONGRESS

  1st Session

                                S. 2809

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