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Q: SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fairness for Homeowners Act of 
2007''.

SEC. 2. ORIGINATIONS OF CONSUMER CREDIT TRANSACTIONS SECURED BY THE 
              CONSUMER'S PRINCIPAL DWELLING.

    (a) In General.--The Truth in Lending Act (15 U.S.C. 1601 et seq.) 
is amended by inserting after section 129 the following new section:
``Sec. 129A. Originations of consumer credit transactions secured by 
              the consumer's principal dwelling
    ``(a) Definitions.--For purposes of this section, the following 
definitions shall apply:
            ``(1) Fully indexed rate.--The term `fully indexed rate' 
        equals the index rate prevailing at the time a consumer credit 
        transaction secured by a consumer's principal dwelling is 
        originated, plus the margin that will apply after the 
        expiration of an introductory interest rate.
            ``(2) Mortgage broker.--The term `mortgage broker' means 
        any person who is defined as a mortgage broker under applicable 
        State law.
    ``(b) Requirements for Originators.--
            ``(1) Ability to pay.--
                    ``(A) In general.--No creditor or mortgage broker 
                may make, provide, or arrange for any consumer credit 
                transaction secured by a consumer's principal dwelling 
                without verifying the consumer's reasonable ability to 
                pay the scheduled payments of the following, as 
                applicable: principal; interest; real estate taxes; 
                homeowner's insurance, assessments, and mortgage 
                insurance premiums.
                    ``(B) Variable interest rate.--In the case of any 
                consumer credit transaction secured by a consumer's 
                principal dwelling for which the applicable annual 
                percentage rate may vary over the life of the credit, 
                the reasonable ability to pay shall be determined, for 
                purposes of this paragraph, on the basis of a fully 
                indexed rate plus 200 basis points and a repayment 
                schedule which achieves full amortization over the life 
                of the extension of credit.
                    ``(C) Verification of consumer income and financial 
                resources.--In the case of any consumer credit 
                transaction secured by a consumer's principal dwelling, 
                the income and financial resources of the consumer 
                shall be verified for purposes of this paragraph by tax 
                returns, payroll receipts, bank records, or other 
                similarly reliable documents.
                    ``(D) Other criteria.--No provision of this 
                paragraph shall be construed as prohibiting reliance on 
                criteria other than a consumer's income and financial 
                resources to establish the reasonable ability of the 
                consumer to repay any consumer credit transaction 
                secured by the consumer's principal dwelling, to the 
                extent such other criteria are also verified through 
                reasonably reliable methods and documentation.
                    ``(E) Consumer statement is insufficient proof.--A 
                statement by a consumer of the consumer's income or 
                financial resources shall not be sufficient to 
                establish the existence of any income or financial 
                resources when verifying the reasonable ability of the 
                consumer to repay any consumer credit transaction 
                secured by the consumer's principal dwelling, for 
                purposes of this paragraph.
            ``(2) Prohibition on steering.--No creditor or mortgage 
        broker may make, provide, or arrange for any consumer credit 
        transaction secured by a consumer's principal dwelling that is 
        of a lower investment grade if--
                    ``(A) the consumer's credit score; or
                    ``(B) comparable underwriting data, in any case in 
                which the creditor or mortgage broker does not utilize 
                credit scoring or a credit score for the consumer is 
                unavailable,
        indicates that the borrower may qualify for a consumer credit 
        transaction, available from or through the creditor or mortgage 
        broker, that is of a higher investment grade.
            ``(3) Prohibition on prepayment penalties for arms.--
                    ``(A) In general.--In the case of any consumer 
                credit transaction secured by a consumer's principal 
                dwelling that provides for variable rates of interest 
                on the credit extended under the transaction, the 
                transaction may not contain terms under which a 
                consumer must pay a prepayment penalty for paying all 
                or part of the principal before the date on which the 
                principal is due.
                    ``(B) Exclusion for jumbo mortgages.--Subparagraph 
                (A) shall not apply to any consumer credit transaction 
                secured by a consumer's principal dwelling the 
                principal amount (as defined in subsection (c)(2)) of 
                which exceeds the maximum dollar amount limitation (for 
                a residence of the applicable size) on the amount of 
                the principal obligation of a mortgage for a 1- to 4-
                family residence that may be purchased by the Federal 
                Home Loan Mortgage Corporation, as then in effect 
                pursuant to section 305(a)(2) of the Federal Home Loan 
                Mortgage Corporation Act.
    ``(c) Limitation on Financed Points, Charges, and Fees.--
            ``(1) In general.--No creditor or mortgage broker may, in 
        connection with any consumer credit transaction secured by the 
        consumer's principal dwelling, include in the principal amount 
        of such transaction any portion of any qualified finance charge 
        in excess of the amount which is equal to 5 percent of the 
        principal amount of the transaction.
            ``(2) Definitions.--For purposes of this subsection, the 
        following definitions shall apply:
                    ``(A) Qualified finance charge.--The term 
                `qualified finance charge' means the sum of--
                            ``(i) the finance charge as determined 
                        under section 106, minus any interest and time 
                        price differential; and
                            ``(ii) all compensation paid to a mortgage 
                        broker from any source in connection with this 
                        transaction.
                    ``(B) Principal amount.--The term `principal 
                amount' means--
                            ``(i) in the case of any consumer credit 
                        transaction under an open end credit plan 
                        secured by the consumer's principal dwelling, 
                        the maximum amount of credit that may be 
                        extended under the terms of such plan as 
                        determined without taking into account any 
                        amount included in determining the finance 
                        charge under section 106; and
                            ``(ii) in the case of any other consumer 
                        credit transaction secured by a consumer's 
                        principal dwelling, the amount financed (as 
                        defined in section 138(a)(2)).
            ``(3) Prohibition on excessive finance charges.--No 
        creditor or mortgage broker may, in connection with any 
        consumer credit transaction secured by the consumer's principal 
        dwelling, impose or receive any amount included in determining 
        the qualified finance charge for such transaction that exceeds 
        the amount which is equal to 5 percent of the principal amount 
        of the transaction.
            ``(4) Exception.--This subsection shall not apply to any 
        consumer credit transaction secured by the consumer's principal 
        dwelling that is ensured or guaranteed by the Secretary of 
        Housing and Urban Development, the Secretary of Veterans 
        Affairs, or the Farmers Home Administration.
    ``(d) Mortgage Broker Duties of Agency.--
            ``(1) In general.--Any mortgage broker acting to obtain or 
        arrange for any consumer credit transaction secured by the 
        consumer's principal dwelling shall be considered to have an 
        agency relationship with the consumer in all cases by operation 
        of law and shall comply with the following duties:
                    ``(A) Mortgage brokers shall act in the consumer's 
                best interest and in the utmost good faith toward each 
                consumer and shall not compromise a consumer's right or 
                interest in favor of another's right or interest, 
                including a right or interest of the mortgage broker.
                    ``(B) A mortgage broker shall not accept, give, or 
                charge any undisclosed compensation or realize any 
                undisclosed remuneration, either through direct or 
                indirect means, that inures to the benefit of the 
                mortgage broker on an expenditure made for the 
                consumer.
                    ``(C) Mortgage brokers shall carry out all lawful 
                instructions given by the consumer.
                    ``(D) Mortgage brokers shall disclose to consumers 
                all material facts of which the mortgage broker has 
                knowledge which might reasonably affect the consumer's 
                rights, interests, or ability to receive the consumer's 
                intended benefit from the consumer credit transaction, 
                but not facts which are reasonably susceptible to the 
                knowledge of the consumer.
                    ``(E) Mortgage brokers shall use reasonable care in 
                performing duties.
                    ``(F) Mortgage brokers shall account to a consumer 
                for all the consumer's money and property received as 
                agent.
            ``(2) Scope.--The duty of agency between mortgage broker 
        and consumer applies when the mortgage broker is acting in the 
        capacity of mortgage broker providing mortgage brokerage 
        services with respect to any consumer credit transaction 
        secured by the consumer's principal dwelling for which the 
        broker is not the creditor.
            ``(3) Rules of construction.--
                    ``(A) Fees for services rendered.--No provision of 
                this subsection shall be construed as prohibiting a 
                mortgage broker from contracting for or collecting a 
                fee for services rendered which had been disclosed to 
                the consumer in advance of the provision of such 
                services.
                    ``(B) Duty of broker.--No provision of this 
                subsection shall be construed as requiring a mortgage 
                broker--
                            ``(i) to obtain or arrange for any consumer 
                        credit transaction secured by the consumer's 
                        principal dwelling on behalf of a consumer that 
                        contains terms or conditions not available to 
                        the mortgage broker in the mortgage broker's 
                        usual course of business; or
                            ``(ii) to obtain or arrange for any 
                        consumer credit transaction secured by the 
                        consumer's principal dwelling from a creditor 
                        with whom the mortgage broker does not have a 
                        business relationship.
    ``(e) Independent Verification of Consumer Counseling Before 
Refinancing Special Mortgages.--
            ``(1) In general.--No creditor or mortgage broker may make, 
        provide, or arrange for any consumer credit transaction secured 
        by the consumer's principal dwelling all or a portion of the 
        proceeds of which are used to fully or partially pay off a 
        special mortgage unless the borrower has obtained a written 
        certification from an authorized independent loan counselor 
        that the borrower has received counseling on the advisability 
        of the transaction.
            ``(2) Definitions.--For purposes of this section, the 
        following definitions shall apply:
                    ``(A) Special mortgage.--The term `special 
                mortgage' means any consumer credit transaction secured 
                by the consumer's principal dwelling that was 
                originated, subsidized, funded, or guaranteed by or 
                through a State, tribal, or local government, or 
                nonprofit organization, that bears 1 or more of the 
                following nonstandard payment terms which substantially 
                benefit the consumer:
                            ``(i) Payments vary with income.
                            ``(ii) Payments of principal or interest 
                        are not required or can be deferred under 
                        specified conditions.
                            ``(iii) Principal or interest is forgivable 
                        under specified conditions.
                            ``(iv) Either no interest or an annual 
                        interest rate of 2 percent or less is charged 
                        in connection with the loan.
                    ``(B) Authorized loan counselor.--The term 
                `authorized independent loan counselor' means any 
                nonprofit, third-party individual or organization 
                providing homebuyer education programs, foreclosure 
                prevention services, mortgage loan counseling, or 
                credit counseling that is certified by the Secretary of 
                Housing and Urban Development, or certified by any 
                State housing agency or nonprofit organization 
                designated by such Secretary, for such purposes.
    ``(f) Minimum Financial Requirements for Mortgage Brokers.--No 
mortgage broker may obtain or arrange for any consumer credit 
transaction secured by the consumer's principal dwelling unless at all 
times the mortgage broker--
            ``(1) maintains a minimum net worth, net of intangibles, of 
        at least $500,000, as determined in accordance with generally 
        accepted accounting principles; or
            ``(2) maintains a surety bond or irrevocable letter of 
        credit in the amount of $50,000.
    ``(g) Enforcement.--For purposes of providing a cause of action for 
any failure by a mortgage broker to comply with any requirement imposed 
under this section, section 130(a) shall be applied with respect to any 
such failure--
            ``(1) by substituting `mortgage broker' for `creditor' each 
        place such term appears in such section; and
            ``(2) by treating all qualified finance charges (as defined 
        in subsection (c)(2)(A)) incurred in the origination of any 
        consumer credit transaction secured by the consumer's principal 
        dwelling as actual damages sustained by the consumer as a 
        result of the failure.
    ``(h) Exclusion of Reverse Mortgages.--This section shall not apply 
with respect to any consumer mortgage transaction that constitutes a 
reverse mortgage.''.
    (b) Technical and Conforming Amendments.--The Truth in Lending Act 
is amended--
            (1) in section 103 (u) (15 U.S.C. 1602(u)), by striking 
        ``and the disclosures required by section 129(a)'' and 
        inserting ``and the provisions of section 129 and 129A''; and
            (2) in section 130 (15 U.S.C. 1640), by inserting ``or 
        129A'' after section 129 each place such term appears.
    (c) Clerical Amendment.--The table of sections for chapter 2 of the 
Truth in Lending Act is amended by inserting after the item relating to 
section 129 the following new item:

``129A. Originations of consumer credit transactions secured by the 
                            consumer's principal dwelling.''.

A: Fairness for Homeowners Act of 2007 - Amends the Truth in Lending Act to prohibit any creditor or mortgage broker from making, providing, or arranging for any consumer credit transaction secured by a consumer's principal dwelling without verifying the consumer's reasonable ability to make the scheduled payments of principal, interest (including variable interest), real estate taxes, homeowner's insurance, assessments, and mortgage insurance premiums.

Prescribes criteria for determining the reasonable ability to make such payments.

Prohibits steering (arranging for a lower investment grade credit transaction if the consumer qualifies for a higher investment grade transaction) and prepayment penalties for adjustable rate mortgages (ARMs) that are not jumbo mortgages.

Limits financed points, finance charges, and fees to 5% of a transaction's principal, unless the transaction is ensured or guaranteed by the Secretary of Housing and Urban Development, the Secretary of Veterans Affairs, or the Farmers Home Administration.

Specifies duties of agency for mortgage brokers acting to obtain or arrange for any consumer credit transaction secured by the consumer's principal dwelling.

Requires creditors and mortgage brokers to obtain independent verification that a borrower seeking to refinance a special mortgage has received counseling on the transaction's advisability. Defines "special mortgage" as one that: (1) was originated, subsidized, funded, or guaranteed by or through a state, tribal, or local government, or nonprofit organization; and (2) bears one or more specified nonstandard payment terms which substantially benefit the consumer.

Prescribes minimum financial requirements for mortgage brokers.

Excludes reverse mortgages from coverage by this Act.
****
Q: SECTION 1. SHORT TITLE: TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Port Authority of 
New York/New Jersey Port Security Task Force Implementation Act of 
2008''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Secure systems of international intermodal transportation. 
Sec. 3. Regional recovery plans. 
Sec. 4. National tactical plans.
Sec. 5. Risk based resource allocation. 
Sec. 6. Use of maritime security risk assessment model.
Sec. 7. Maritime and cargo security integrated project teams.
Sec. 8. Integration of security plans and systems with local port 
                            authority and law enforcement agencies.
Sec. 9. Standardized policy for advanced notice of Coast Guard boarding 
                            for security or port state control 
                            inspections.
Sec. 10. Fraudulent or tampered with transportation worker 
                            identification cards.
Sec. 11. Federal licensing of ship agents.
Sec. 12. Establishment of a security individual.
Sec. 13. Certification of maritime security guards.
Sec. 14. Grants to tier 1 and tier 2 ports require regional strategic 
                            risk management assessment.
Sec. 15. Vessel security plans for supply and similar vessels.

SEC. 2. SECURE SYSTEMS OF INTERNATIONAL INTERMODAL TRANSPORTATION.

    Section 70116 of title 46, United States Code, is amended--
            (1) by striking ``transportation.'' in subsection (a) and 
        inserting ``transportation--
            ``(1) to ensure the security and integrity of shipments of 
        goods to the United States from the point at which such goods 
        are initially packed or loaded into a cargo container for 
        international shipment until they reach their ultimate 
        destination; and
            ``(2) to facilitate the movement of such goods through the 
        entire supply chain through an expedited security and clearance 
        program.''; and
            (2) by striking subsection (b) and inserting the following:
    ``(b) Program Elements.--Within one year after the date of 
enactment of the Port Authority of New York/New Jersey Port Security 
Task Force Implementation Act of 2008, the Secretary, acting through 
the Commissioner of Customs and Border Protection, shall--
            ``(1) establish minimum standards and procedures for 
        verifying, at the point at which goods are placed in a cargo 
        container for shipping, that the container is free of 
        unauthorized contents, including hazardous chemical, 
        biological, radiological, or nuclear material and for securely 
        sealing such containers after the contents are so verified;
            ``(2) establish standards and procedures for securing cargo 
        and monitoring that security while in transit;
            ``(3) develop performance standards to enhance the physical 
        security of shipping containers, including performance 
        standards for seals and locks and protocols and procedures to 
        address anomalies;
            ``(4) establish standards and procedures for screening and 
        evaluating cargo prior to loading in a foreign port for 
        shipment to the United States either directly or via a foreign 
        port;
            ``(5) establish standards and procedures that will enable 
        the United States Government to ensure and validate compliance 
        with those standards and procedures; and
            ``(6) incorporate any other measures the Secretary 
        considers necessary to ensure the security and integrity of 
        international intermodal transport movements.
    ``(c) Requirements for Entry of Containers.--Beginning 1 year after 
the date on which the Secretary determines that the standards and 
procedures under subsection (b)(5) have been established and are in 
effect, the Commissioner of Customs and Border Protection shall refuse 
entry into the customs territory of the United States to any container, 
arriving directly or via a foreign port, unless the entity shipping the 
container has complied with those standards and procedures with respect 
to that container.''.

SEC. 3. REGIONAL RECOVERY PLANS.

    (a) Establishment.--Section 70103(b)(2) of title 46, United States 
Code, is amended--
            (1) by redesignating subparagraphs (E) through (G) as 
        subparagraphs (F) through (H), respectively; and
            (2) by inserting after subparagraph (D) the following:
                    ``(E) establish regional response and recovery 
                protocols to prepare for, respond to, mitigate against, 
                and recover from a transportation security incident 
                consistent with section 202 of the Security and 
                Accountability for Every Port Act of 2006 (6 U.S.C. 
                942) and section 70103(a) of title 46, United States 
                Code;''.
    (b) Coordination of Plans.--Section 70103(b)(1) of title 46, United 
States Code, is amended--
            (1) by striking ``and'' after the semicolon in subparagraph 
        (F);
            (2) by redesignating subparagraph (G) as subparagraph (H); 
        and
            (3) by inserting after subparagraph (F) the following:
            ``(G) be consistent with, and support implementation of, 
        the National Incident Management System, the National Response 
        Plan, the National Infrastructure Protection Plan, the National 
        Preparedness Guidance, the National Preparedness Goal, the 
        National Transportation Security Plan, National Tactical Plans, 
        and other similar initiatives; and''.
    (c) Use of Area Maritime Transportation Security Plans in 
Exercises.--Section 114(b)(1) of the SAFE Port Act (6 U.S.C. 912(b)) is 
amended--
            (1) by striking ``and'' after the semicolon in paragraph 
        (1);
            (2) by redesignating paragraph (2) as paragraph (3); and
            (3) by inserting after paragraph (1) the following:
            ``(2) utilizes the Area Maritime Transportation Security 
        Plans established under section 70103(b) of title 46, United 
        States Code, in conducting such exercises; and''.

SEC. 4. NATIONAL TACTICAL PLANS.

    The Secretary of the department in which the Coast Guard is 
operating shall ensure that the National Tactical Plan is shared with 
the Area Maritime Security Committees established under section 70112 
of title 46, United States Code. The Area Maritime Security Committees 
shall use the plan in developing regional and local plans and for 
exercises.

SEC. 5. RISK BASED RESOURCE ALLOCATION.

    (a) National Standard.--Within 1 year after the date of enactment 
of this Act, in carrying out chapter 701 of title 46, United States 
Code, the Homeland Security Act of 2002, and the Security and 
Accountability for Every Port Act of 2006 the Secretary of the 
department in which the Coast Guard is operating shall develop and 
utilize a national standard and formula for prioritizing and addressing 
assessed security risks at United States ports, such as the Maritime 
Assessment Strategy Tool that has been tested by the Department of 
Homeland Security.
    (b) Use by Maritime Security Committees.--Within 2 years after the 
date of enactment of this Act, the Secretary shall require each Area 
Maritime Security Committee to use this standard to regularly evaluate 
each port's assessed risk and prioritize how to mitigate the most 
significant risks.
    (c) Other Uses of Standard.--The Secretary shall utilize the 
standard when considering departmental resource allocations and grant-
making decisions.

SEC. 6. USE OF MARITIME SECURITY RISK ASSESSMENT MODEL.

    Within 180 days after the date of enactment of this Act, the 
Secretary of the department in which the Coast Guard is operating shall 
make the United States Coast Guard's Maritime Security Risk Assessment 
Model tool available, in an unclassified version, on a limited basis to 
regulated vessels and facilities to conduct true risk assessments of 
their own facilities and vessels using the same criteria employed by 
the United States Coast Guard when evaluating a port area.

SEC. 7. MARITIME AND CARGO SECURITY INTEGRATED PROJECT TEAMS.

    The Secretary of Homeland Security shall--
            (1) establish integrated project teams within the science 
        and technology directorate to assist the Department of Homeland 
        Security in product research, development, transition, and 
        acquisition activities for cargo security; and
            (2) provide for participation by port authorities or the 
        appropriate State agency responsible for oversight of port 
        areas in such activities.

SEC. 8. INTEGRATION OF SECURITY PLANS AND SYSTEMS WITH LOCAL PORT 
              AUTHORITY AND LAW ENFORCEMENT AGENCIES.

    Section 70102 of title 46, United States Code, is amended by adding 
at the end thereof the following:
    ``(c) Sharing of Assessment; Integration of Plans and Equipment.--
The owner or operator of a facility shall--
            ``(1) make a current copy of the vulnerability assessment 
        conducted under subsection (b) available to the port authority 
        with jurisdiction of the facility and appropriate State or 
        local law enforcement agencies; and
            ``(2) integrate, to the maximum feasible extent, any 
        security system for the facility with compatible systems 
        operated or maintained by the port authority or such law 
        enforcement agencies.''.

SEC. 9. STANDARDIZED POLICY FOR ADVANCED NOTICE OF COAST GUARD BOARDING 
              FOR SECURITY OR PORT STATE CONTROL INSPECTIONS.

    Within 90 days after the date of enactment of this Act, the 
Commandant of the Coast Guard shall establish, and publish in the 
Federal Register, a policy governing how much advance notice is to be 
provided by the Coast Guard to the owner or operator of a vessel before 
the vessel is boarded by the Coast Guard for ISPS compliance or Port 
State Control inspection.

SEC. 10. FRAUDULENT OR TAMPERED WITH TRANSPORTATION WORKER 
              IDENTIFICATION CARDS.

    Section 70105 of title 46, United States Code, is amended by adding 
at the end thereof the following:
    ``(n) Confiscation of Fraudulent TWICs.--If any Federal, State, or 
local government law enforcement officer, or any member of the United 
States Coast Guard in the execution of such officer's duties, has 
reasonable cause to believe that a transportation security card issued 
under this section is fraudulent, has been unlawfully modified, or is 
otherwise invalid, the officer may confiscate the card, notify the 
Department of Homeland Security, and hold the bearer of the card in 
custody for a reasonable period of time for relinquishment to 
appropriate law enforcement authorities.''.

SEC. 11. FEDERAL LICENSING OF SHIP AGENTS.

    (a) In General.--Within 1 year after the date of enactment of this 
Act, the Federal Maritime Commission shall establish and implement a 
procedure for the training, certification, and licensing of steamship 
agents and agencies operating in the United States.
    (b) TWIC Required.--An individual may not receive a license under 
the procedure established by the Federal Maritime Commission under 
subsection (a) unless that individual holds a valid transportation 
security card issued under section 70105 of title 46, United States 
Code.
    (c) License Requirement.--Beginning 1 year after the date on which 
the Federal Maritime Commission establishes the licensing procedure, or 
after such date as the Federal Maritime Commission may establish, it 
shall be unlawful for any person to act as a vessel agent in the United 
States without a valid license issued by the Federal Maritime 
Commission and a valid transportation security card issued under 
section 70105 of title 46, United States Code.
    (d) Enforcement.--Violation of subsection (c) is punishable by 
imprisonment for not more than 1 year and a fine under title 18, United 
States Code.

SEC. 12. ESTABLISHMENT OF A SECURITY INDIVIDUAL.

    Under regulations prescribed by the Secretary of Homeland Security, 
each vessel documented under chapter 121 of title 46, United States 
Code, and each foreign vessel entering a United States port, engaged in 
the commercial transportation of goods or passengers shall--
            (1) designate a United States person that is responsible 
        for responding to a transportation security incident involving 
        the vessel while in a United States port by notifying 
        appropriate emergency response entities and facilitating vessel 
        response activities; and
            (2) provide notice to the Secretary of Homeland Security, 
        the Commandant of the Coast Guard, and the captain of the port 
        of the identity and contact information for such person.

SEC. 13. CERTIFICATION OF MARITIME SECURITY GUARDS.

    (a) In General.--Chapter 701 of title 46, United States Code, is 
amended by adding at the end thereof the following:
``Sec. 70122. Incident command system training
    ``The Secretary shall ensure that all maritime security guards meet 
minimum training and performance standards in the Department of 
Homeland Security's security awareness and response procedures and in 
the handling of hazardous materials.''.
    (b) Conforming Amendment.--The chapter analysis for chapter 701 of 
title 46, United States Code, is amended by inserting after the item 
relating to section 70121 the following:

``70122. Incident command system training.''.

SEC. 14. GRANTS TO TIER 1 AND TIER 2 PORTS REQUIRE REGIONAL STRATEGIC 
              RISK MANAGEMENT ASSESSMENT.

    Section 70107(a) of title 46, United States Code, is amended by 
adding at the end ``The Secretary shall establish regional strategic 
risk management priorities for tier 1 and tier 2 ports and take such 
priorities into account in awarding grants under this section.''.

SEC. 15. VESSEL SECURITY PLANS FOR SUPPLY AND SIMILAR VESSELS.

    (a) In General.--Section 70103(c)(2)(A) of title 46, United States 
Code, is amended by striking ``incident;'' and inserting ``incident 
(including supply vessels, bunker and fuel deliver and launch vessels 
conducting activities or providing services to other vessels at 
anchorage;''.
    (b) TWICs Required for Crew.--Section 70105(b)(2)(F) of title 46, 
United States Code, is amended by inserting ``personnel working on 
board vessels described in section 70103(c)(2)(A) of this title and'' 
after ``(F)''.
    (c) Effective Date.--The amendments made by this section shall take 
effect 1 year after the date of enactment of this Act.

A: Port Authority of New York/New Jersey Port Security Task Force Implementation Act of 2008 - Amends federal port security law to revise mandatory elements of the secure system of transportation program.

Directs the Secretary of the department in which the Coast Guard is operating, acting through the Commissioner of Customs and Border Protection, to establish minimum program standards and procedures for verifying, at the point goods are placed in a cargo container for shipping, that such container is free of unauthorized contents, including hazardous chemical, biological, radiological, or nuclear material, and is securely sealed after verification of its contents. Prohibits the entry of any container that has not complied with such standards and procedures.

Requires Area Maritime Transportation Security Plans to establish regional response and recovery protocols for transportation security incidents.

Amends the SAFE Port Act to require the Secretary of Homeland Security to ensure that the Port Security Exercise Program utilizes Area Maritime Transportation Security Plans in conducting port security exercises.

Requires the Secretary of the department in which the Coast Guard is operating to develop and utilize a national standard for prioritizing and assessing security risks at U.S. ports, such as the Maritime Assessment Strategy Tool.

Sets forth requirements regarding: (1) use of the U.S. Coast Guard's Maritime Security Risk Assessment Model tool to conduct vessel and port facility security risk assessments; (2) establishment of maritime and cargo security integrated project teams; (3) sharing of port facility vulnerability assessments and integration of port security plans and systems with local port authority and law enforcement agencies; (4) policy for advanced notice of Coast Guard boarding of vessels for security or Port State Control inspections; (5) confiscation of fraudulent transportation worker identification cards (TWICs); (6) Federal Maritime Commission training and licensing of steamship agents; (7) designation of a U.S. person to be responsible for notifying emergency response entities in the event of a transportation security incident involving a U.S. or foreign vessel; (8) minimum incident command system training and performance standards for maritime security guards; (9) consideration of regional strategic risk management priorities for tier 1 and tier 2 ports in grant awards; and (10) the submission of security plans for supply, bunker, and fuel deliver and launch vessels conducting activities or providing services to other vessels at anchorage.
****
Q: SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Verifying Authority and Legality In 
Drug Compounding Act of 2012''.

SEC. 2. APPLICATION OF FEDERAL LAW TO PRACTICE OF PHARMACY COMPOUNDING.

    (a) Amendment.--Section 503A of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 353a) is amended to read as follows:

``SEC. 503A. PHARMACY COMPOUNDING.

    ``(a) In General.--Sections 501(a)(2)(B) and 505 shall not apply 
with respect to a drug product if each of the following applies:
            ``(1) The drug product is compounded for an identified 
        individual patient based on the receipt of--
                    ``(A) a valid prescription order; or
                    ``(B) a notation, approved by the prescribing 
                practitioner, on the prescription order that a 
                compounded product is necessary for the identified 
                patient.
            ``(2) The drug product is compounded by a licensed 
        pharmacist in a State-licensed pharmacy or a Federal facility, 
        or by a licensed physician, pursuant to such prescription order 
        or notation.
            ``(3) The drug product is compounded exclusively from--
                    ``(A) ingredients that comply with the standards of 
                an applicable United States Pharmacopoeia or National 
                Formulary monograph; or
                    ``(B) if such a monograph does not exist, 
                ingredients that are ingredients in a drug--
                            ``(i) for which an approval of an 
                        application filed under subsection (b) or (j) 
                        of section 505 is in effect; or
                            ``(ii) that may be lawfully marketed in the 
                        United States without such an approval pursuant 
                        to the definition of a new drug in section 201.
            ``(4) Any bulk substance used for purposes of compounding 
        the drug product--
                    ``(A) is manufactured by an establishment that is 
                registered under section 510 (including a foreign 
                establishment that is registered under section 510(i)); 
                and
                    ``(B) is accompanied by valid certificates of 
                analysis.
            ``(5) The pharmacist or physician compounding the drug 
        product complies with the standards of any applicable United 
        States Pharmacopoeia chapters on pharmacy compounding.
            ``(6) The drug product, including the dosage form and any 
        ingredient thereof, is not included in the list under 
        subsection (b).
            ``(7) The drug product is not a copy of a commercially 
        available drug.
    ``(b) List of Drug Products That Should Not Be Compounded.--
            ``(1) In general.--For purposes of subsection (a)(6), the 
        Secretary shall--
                    ``(A) develop and maintain a list of drug products 
                that should not be compounded, including any 
                categories, dosage forms, or ingredients of such drug 
                products; and
                    ``(B) include on such list, at a minimum--
                            ``(i) drug products (or categories, dosage 
                        forms, or ingredients thereof) whose 
                        compounding is reasonably likely to cause an 
                        adverse effect on safety or effectiveness of 
                        such drug product; and
                            ``(ii) drug products (or categories, dosage 
                        forms, or ingredients thereof) that have been 
                        withdrawn or removed from the market because 
                        they have been found to be unsafe or not 
                        effective.
            ``(2) Initial publication; updates.--The Secretary shall--
                    ``(A) not later than 1 year after the date of the 
                enactment of the Verifying Authority and Legality In 
                Drug Compounding Act of 2012, publish an initial list 
                under paragraph (1); and
                    ``(B) not less frequently than every year 
                thereafter, review and, as appropriate, update the list 
                under paragraph (1).
            ``(3) Availability.--The Secretary shall make the list 
        under paragraph (1) available on the public Web site of the 
        Food and Drug Administration.
            ``(4) Transmission to state regulatory agencies.--Upon 
        publication of the initial list under paragraph (1), and upon 
        each update to the list, the Secretary shall transmit an up-to-
        date copy of the list to the agency in each State with primary 
        responsibility for regulating the compounding of drugs.
    ``(c) Waiver of Requirement of Individually Identified Patient for 
Specified Drug Products.--
            ``(1) Waiver authority.--The Secretary may, with respect to 
        a drug product sold or dispensed by a pharmacy or pharmacist, 
        waive the requirement of subsection (a)(1) that the drug 
        product be compounded for an individually identified patient if 
        the Secretary determines that compounding the drug product is 
        necessary--
                    ``(A) to address a drug shortage; or
                    ``(B) to protect public health or well-being.
            ``(2) Duration.--The duration of a waiver under paragraph 
        (1) shall not exceed 1 year, unless the Secretary determines 
        that an extension is necessary to continue--
                    ``(A) to address the drug shortage for which such 
                waiver was originally approved; or
                    ``(B) to protect public health or well-being.
            ``(3) Waivers by states prohibited.--The Secretary may not 
        authorize any State to grant waivers under this subsection.
    ``(d) Waiver of Requirement of Individually Identified Patient for 
Specified Pharmacies and Pharmacists.--
            ``(1) Waiver authority.--The Secretary may waive the 
        requirement of subsection (a)(1) that the drug product be 
        compounded for an individually identified patient if the 
        pharmacy or pharmacist--
                    ``(A) submits an application that meets the 
                requirements of paragraph (5)(A) and is satisfactory to 
                the Secretary (or, subject to paragraph (3), the 
                State); and
                    ``(B) agrees to comply with any condition of 
                operation and any limitations specified by the 
                Secretary as a requirement for such waiver, including 
                the conditions and limitations specified under 
                paragraph (5).
            ``(2) Ineligible pharmacies.--A pharmacy or pharmacist 
        required to be registered under section 510 for purposes of 
        compounding a drug product is not eligible for a waiver under 
        this subsection for such purposes.
            ``(3) Types of pharmacies eligible for waiver.--Subject to 
        paragraph (2), the Secretary shall specify types of pharmacies 
        and pharmacists that are eligible for a waiver under this 
        subsection, and shall include the following types:
                    ``(A) Any pharmacy or pharmacist within a hospital 
                system that is compounding drug products exclusively 
                for dispensing to patients within that hospital system.
                    ``(B) Any pharmacy or pharmacist that compounds 
                sterile drug products.
                    ``(C) Any pharmacy or pharmacist that compounds 
                drug products in limited quantities before the receipt 
                of a valid prescription for an individual patient who 
                is located in the same State as the pharmacy or 
                pharmacist, based on a history of the pharmacy or 
                pharmacist receiving such valid prescription.
            ``(4) Waivers by states allowed.--
                    ``(A) Memorandum of understanding.--The Secretary 
                may authorize a State to grant waivers under paragraph 
                (1) to pharmacies and pharmacists in such State 
                pursuant to a memorandum of understanding entered into 
                between the Secretary and the State--
                            ``(i) ensuring, to the Secretary's 
                        satisfaction, that the State's program for 
                        granting waivers will be implemented in 
                        accordance with the requirements of this 
                        section (including the application of different 
                        requirements for different types of pharmacies, 
                        as specified under paragraph (5)(B)); and
                            ``(ii) including such other information and 
                        assurances as the Secretary may require.
                    ``(B) Determination.--The Secretary shall establish 
                criteria and a process for determining whether to 
                authorize a State to grant waivers under paragraph (1).
                    ``(C) Scope of authorization.--In authorizing a 
                State to grant waivers under subparagraph (A), the 
                Secretary may limit such authority to apply only with 
                respect to certain types of pharmacies and pharmacists 
                specified under paragraph (3).
                    ``(D) Limitation.--A waiver granted by a State to a 
                pharmacy or pharmacist under subparagraph (A) shall 
                only apply with respect to compounded drug products 
                sold or dispensed within such State.
            ``(5) Applications; requirements.--
                    ``(A) In general.--For each type of pharmacy or 
                pharmacist specified under paragraph (3), the Secretary 
                shall specify, in the regulations under subsection (j), 
                the following:
                            ``(i) The information that is required to 
                        be included in an application for a waiver 
                        under paragraph (1).
                            ``(ii) The circumstances necessary to 
                        support the approval of such an application by 
                        the Secretary, or by a State that is authorized 
                        to grant waivers under paragraph (4), including 
                        the criteria that shall be used to evaluate 
                        such an application.
                            ``(iii) The conditions of operation, 
                        including good manufacturing practices and 
                        requirements for third-party testing, 
                        applicable to the compounding of drugs under 
                        such a waiver.
                            ``(iv) Any limitations on the activities 
                        that a pharmacy or pharmacist may engage in 
                        under such a waiver.
                            ``(v) The duration (and renewability) of 
                        such a waiver.
                    ``(B) Specificity to types of pharmacies and 
                pharmacists.--In establishing requirements under 
                subparagraph (A), the Secretary shall make the 
                requirements specific to each type of pharmacy and 
                pharmacist specified by the Secretary under paragraph 
                (3).
    ``(e) Waiver of Requirement Regarding Copies of Commercially 
Available Drug.--
            ``(1) Waiver authority.--The Secretary may, with respect to 
        a drug product sold or dispensed by a pharmacy or pharmacist, 
        waive the requirement of subsection (a)(7) if the Secretary 
        determines that compounding the drug product is necessary to 
        protect public health or well-being.
            ``(2) Duration.--The duration of a waiver under paragraph 
        (1) shall not exceed 1 year, unless the Secretary determines 
        that an extension is necessary to protect public health or 
        well-being.
            ``(3) Waivers by states prohibited.--The Secretary may not 
        authorize any State to grant waivers under this subsection.
    ``(f) Inspections.--The facilities of any pharmacy or pharmacist 
compounding drug products pursuant to a waiver under subsection (c), 
(d), or (e) shall be subject to inspection under section 704 for 
purposes of determining compliance with the provisions of this Act 
applicable to such compounding.
    ``(g) Cancellation of Waiver.--
            ``(1) In general.--The Secretary shall publish notice at 
        least 30 days before cancelling a waiver under subsection (c), 
        (d), or (e).
            ``(2) Exception for public health and safety.--The 
        Secretary may cancel a waiver without regard to paragraph (1) 
        in order to prevent an adverse impact on public health or 
        safety.
    ``(h) Labeling.--The labeling of any drug product compounded 
pursuant to subsection (a) shall include the following statement: `This 
drug has not been tested for safety and effectiveness and is not 
approved by the FDA. Serious adverse reactions to this drug should be 
reported to the pharmacy where it was received and the FDA at _____.' 
The blank shall specify a phone number and a Web site, to be provided 
by the Secretary for purposes of this subsection.
    ``(i) Reporting by Pharmacists and Physicians.--
            ``(1) Adverse event.--If a pharmacist or physician 
        compounding a drug product pursuant to this section becomes 
        aware of any adverse event associated with the use of such 
        product, not later than 10 calendar days after becoming so 
        aware, the pharmacist or physician shall report such adverse 
        event to the Secretary.
            ``(2) Information related to risk of injury or death.--If a 
        pharmacist or physician compounding a drug product pursuant to 
        this section becomes aware of information concerning any 
        bacteriological, fungal, or other contamination; any 
        significant chemical, physical, or other change; or any 
        deterioration of a compounded drug product that has already 
        been distributed by the pharmacist or physician, that could 
        cause serious injury or death, not later than 5 calendar days 
        after becoming so aware, the pharmacist or physician shall 
        report such information to the Secretary.
    ``(j) Regulations.--The Secretary shall promulgate regulations for 
carrying out this section, which shall include the following:
            ``(1) The types of pharmacies and pharmacists specified 
        pursuant to subsection (d)(3).
            ``(2) The criteria and process for determining whether a 
        State may provide a waiver under subsection (d)(4).
            ``(3) The information specified under subsection (d)(5)(A).
            ``(4) The requirements applicable to different types of 
        pharmacies and pharmacists under subsection (d)(5).
            ``(5) The requirements for inspections under subsection 
        (f).
    ``(k) Definitions.--In this section:
            ``(1) The term `copy of a commercially available drug 
        product' does not include a drug product in which there is a 
        change, made for an identified individual patient, which 
        produces for that patient a significant difference, as 
        determined by the prescribing practitioner, between the 
        compounded drug and the comparable commercially available drug 
        product.
            ``(2) The term `compounding' does not include mixing, 
        reconstituting, or other such acts that are performed in 
        accordance with directions contained in approved labeling 
        provided by the product's manufacturer and other manufacturer 
        directions consistent with that labeling.''.
    (b) Misbranding.--Section 502 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 352) is amended by adding at the end the 
following:
    ``(bb) If it is a drug product compounded pursuant to section 503A 
and its labeling does not include the statement required by section 
503A(h).''.
    (c) Conforming Amendment.--Section 704(a)(2)(A) of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 374(a)(2)(A)) is amended by 
inserting ``subject to section 503A,'' before ``pharmacies which 
maintain establishments''.
    (d) Regulations.--Not later than 1 year after the date of the 
enactment of this Act, the Secretary shall promulgate final regulations 
for carrying out the amendments made by subsections (a), (b), and (c).
    (e) Effective Date.--The amendments made by subsections (a), (b), 
and (c) shall take effect on the date that is 1 year after the date of 
the enactment of this Act.

SEC. 3. REGISTRATION AND INSPECTION OF MANUFACTURERS COMPOUNDING DRUG 
              PRODUCTS.

    (a) Registration.--Section 510(g) of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 360(g)) is amended by adding at the end the 
following: ``With respect to compounding drugs, the exemption in 
paragraph (1) does not apply with respect to any pharmacy to the extent 
to which the pharmacy is, in effect, manufacturing such drugs, as 
determined by the Secretary, taking into consideration the extent to 
which such pharmacy sells the drugs across State lines, the quantity of 
the drugs sold, and any other factors determined appropriate by the 
Secretary.''.
    (b) Inspection.--Section 704(a)(2) of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 374(a)(2)) is amended by adding at the end the 
following flush text:
        ``With respect to compounding drugs, the exemption in 
        subparagraph (A) does not apply with respect to any pharmacy to 
        the extent to which the pharmacy is, in effect, manufacturing 
        such drugs, as determined by the Secretary, taking into 
        consideration the extent to which such pharmacy sells the drugs 
        across State lines, the quantity of the drugs sold, and any 
        other factors determined appropriate by the Secretary.''.
    (c) Regulations.--Not later than 1 year after the date of the 
enactment of this Act, the Secretary of Health and Human Services shall 
promulgate regulations for carrying out the amendments made by 
subsections (a) and (b).
    (d) Effective Date.--The amendment made by subsection (a) shall 
take effect on the date that is 1 year after the date of the enactment 
of this Act.

A:
Verifying Authority and Legality In Drug Compounding Act of 2012 - Amends the Federal Food, Drug, and Cosmetic Act (FFDCA) with respect to the regulation of compounding drugs.

Eliminates authority for compounding pharmacies to: (1) compound drugs before the receipt of a valid prescription order, or (2) compound any drug product that is a copy of a commercially available drug.

Requires the Secretary of Health and Human Services (HHS) to develop, maintain and transmit to the appropriate state agencies a list of drug products that should not be compounded, including: (1) drug products whose compounding is reasonably likely to cause an adverse effect on their safety or effectiveness; and (2) drug products that have been withdrawn or removed from the market because they have been found to be unsafe or not effective.

Authorizes the Secretary to waive the requirement that a drug product must be compounded for an individually identified patient based on a valid prescription order or similar notation if compounding the drug product is necessary to address a drug shortage, or to protect public health or well-being. Prohibits the Secretary from authorizing a state to grant such waivers.

Authorizes the Secretary to waive the requirement that a drug product must be compounded for an individually identified patient based on a valid prescription order or similar notation if the pharmacy or pharmacist: (1) submits a satisfactory application to the Secretary; and (2) agrees to comply with any condition or limitation specified by the Secretary. Makes a pharmacy or pharmacist required to be registered under the FFDCA as a drug producer ineligible for a waiver. Permits the Secretary to authorize a state to grant such waivers applicable to compounded drug products sold or dispensed within the state pursuant to a memorandum of understanding between the Secretary and the state.

Authorizes the Secretary to waive the prohibition against compounding any drug product that is a copy of a commercially available drug if it is necessary to protect public health or well-being. Prohibits the Secretary from authorizing a state to waive such prohibition.

Subjects the facilities of any pharmacy receiving a waiver under this Act to inspection to determine compliance with this Act.

Requires the Secretary to publish notice at least 30 days before cancelling a waiver, unless it is necessary to prevent an adverse impact on public health or safety.

Sets forth a required label statement for any drug compounded pursuant to this Act.

 Requires a pharmacist or physician compounding a drug product to report any adverse event associated with the use of the product within a specified time frame.
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