Temporary Payroll Tax Cut Continuation Act of 2011
PL 112-78 (H.R.3765), enacted 12/23/2011

125 STAT. 1280 
PUBLIC LAW 112–78—DEC. 23, 2011 
Public Law 112–78 
112th Congress 
An Act 
To extend the payroll tax holiday, unemployment compensation, Medicare physician 
payment, provide for the consideration of the Keystone XL pipeline, and for 
other purposes. 
Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the ‘‘Temporary 
Payroll Tax Cut Continuation Act of 2011’’. 
(b) TABLE OF CONTENTS.—The table of contents of this Act 
is as follows: 
Sec. 1. Short title; table of contents. 
TITLE I—TEMPORARY PAYROLL TAX RELIEF 
Sec. 101. Extension of payroll tax holiday. 
TITLE II—TEMPORARY EXTENSION OF UNEMPLOYMENT COMPENSATION 
PROVISIONS 
Sec. 201. Temporary extension of unemployment compensation provisions. 
Sec. 202. Extended unemployment benefits under the Railroad Unemployment In-
surance Act. 
TITLE III—TEMPORARY EXTENSION OF HEALTH PROVISIONS 
Sec. 301. Medicare physician payment update. 
Sec. 302. 2-month extension of MMA section 508 reclassifications. 
Sec. 303. Extension of Medicare work geographic adjustment floor. 
Sec. 304. Extension of exceptions process for Medicare therapy caps. 
Sec. 305. Extension of payment for technical component of certain physician pathol-
ogy services. 
Sec. 306. Extension of ambulance add-ons. 
Sec. 307. Extension of physician fee schedule mental health add-on payment. 
Sec. 308. Extension of outpatient hold harmless provision. 
Sec. 309. Extending minimum payment for bone mass measurement. 
Sec. 310. Extension of the qualifying individual (QI) program. 
Sec. 311. Extension of Transitional Medical Assistance (TMA). 
Sec. 312. Extension of the temporary assistance for needy families program. 
TITLE IV—MORTGAGE FEES AND PREMIUMS 
Sec. 401. Guarantee Fees. 
Sec. 402. FHA guarantee fees. 
TITLE V—OTHER PROVISIONS 
Subtitle A—Keystone XL Pipeline 
Sec. 501. Permit for Keystone XL pipeline. 
Subtitle B—Budgetary Provisions 
Sec. 511. Senate point of order against an emergency designation. 
Sec. 512. PAYGO scorecard estimates. 
Temporary 
Payroll Tax Cut 
Continuation Act 
of 2011. 
26 USC 1 note. 
Dec. 23, 2011 
[H.R. 3765] 
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125 STAT. 1281 
PUBLIC LAW 112–78—DEC. 23, 2011 
TITLE I—TEMPORARY PAYROLL TAX 
RELIEF 
SEC. 101. EXTENSION OF PAYROLL TAX HOLIDAY. 
(a) IN GENERAL.—Subsection (c) of section 601 of the Tax Relief, 
Unemployment Insurance Reauthorization, and Job Creation Act 
of 2010 (26 U.S.C. 1401 note) is amended to read as follows: 
‘‘(c) PAYROLL TAX HOLIDAY PERIOD.—The term ‘payroll tax holi-
day period’ means— 
‘‘(1) in the case of the tax described in subsection (a)(1), 
calendar years 2011 and 2012, and 
‘‘(2) in the case of the taxes described in subsection (a)(2), 
the period beginning January 1, 2011, and ending February 
29, 2012.’’. 
(b) SPECIAL RULES FOR 2012.—Section 601 of such Act (26 
U.S.C. 1401 note) is amended by adding at the end the following 
new subsection: 
‘‘(f) SPECIAL RULES FOR 2012.— 
‘‘(1) LIMITATION ON SELF-EMPLOYMENT INCOME.—In the case 
of any taxable year beginning in 2012, subsection (a)(1) shall 
only apply with respect to so much of the taxpayer’s self- 
employment income (as defined in section 1402(b) of the 
Internal Revenue Code of 1986) as does not exceed the excess 
(if any) of— 
‘‘(A) $18,350, over 
‘‘(B) the amount of wages and compensation received 
during the portion of the payroll tax holiday period occur-
ring during 2012 subject to tax under section 3101(a) of 
such Code or section 3201(a) of such Code. 
‘‘(2) COORDINATION
WITH
DEDUCTION
FOR
EMPLOYMENT 
TAXES.—In the case of a taxable year beginning in 2012, 
subparagraph (A) of subsection (b)(2) shall be applied as if 
it read as follows: 
‘‘ ‘(A) the sum of— 
‘‘ ‘(i) 59.6 percent of the portion of such taxes attrib-
utable to the tax imposed by section 1401(a) of such 
Code (determined after the application of this section) 
on so much of self-employment income (as defined in 
section 1402(b) of such Code) as does not exceed the 
amount of self-employment income described in para-
graph (1), plus 
‘‘ ‘(ii) one-half of the portion of such taxes attrib-
utable to the tax imposed by section 1401(a) of such 
Code (determined without regard to this section) on 
self-employment income (as so defined) in excess of 
such amount, plus’.’’. 
(c) RECAPTURE OF EXCESS BENEFIT.—Section 601 of such Act 
(26 U.S.C. 1401 note), as amended by subsection (b), is further 
amended by adding at the end the following new subsection: 
‘‘(g) RECAPTURE OF EXCESS BENEFIT.— 
‘‘(1) IN GENERAL.—There is hereby imposed on the income 
of every individual a tax equal to 2 percent of the sum of 
wages (within the meaning of section 3121(a)(1) of the Internal 
Revenue Code of 1986) and compensation (to which section 
Applicability. 
Definition. 
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125 STAT. 1282 
PUBLIC LAW 112–78—DEC. 23, 2011 
3201(a) of such Code applies) received during the period begin-
ning January 1, 2012, and ending February 29, 2012, to the 
extent the amount of such sum exceeds $18,350. 
‘‘(2) REGULATIONS.—The Secretary of the Treasury or the 
Secretary’s delegate shall prescribe such regulations or other 
guidance as may be necessary or appropriate to carry out 
this subsection, including guidance for payment by the 
employee of the tax imposed by paragraph (1).’’. 
(d) TECHNICAL AMENDMENTS.—Paragraph (2) of section 601(b) 
of such Act (26 U.S.C. 1401 note) is amended— 
(1) by inserting ‘‘of such Code’’ after ‘‘164(f)’’; 
(2) by inserting ‘‘of such Code’’ after ‘‘1401(a)’’ in subpara-
graph (A); and 
(3) by inserting ‘‘of such Code’’ after ‘‘1401(b)’’ in subpara-
graph (B). 
(e) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as provided in paragraph (2), the 
amendments made by this section shall apply to remuneration 
received, and taxable years beginning, after December 31, 2011. 
(2) TECHNICAL AMENDMENTS.—The amendments made by 
subsection (d) shall take effect as if included in the enactment 
of section 601 of the Tax Relief, Unemployment Insurance 
Reauthorization, and Job Creation Act of 2010. 
TITLE II—TEMPORARY EXTENSION OF 
UNEMPLOYMENT 
COMPENSATION 
PROVISIONS 
SEC. 201. TEMPORARY EXTENSION OF UNEMPLOYMENT COMPENSA-
TION PROVISIONS. 
(a) IN GENERAL.—(1) Section 4007 of the Supplemental Appro-
priations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 note) 
is amended— 
(A) by striking ‘‘January 3, 2012’’ each place it appears 
and inserting ‘‘March 6, 2012’’; 
(B) in the heading for subsection (b)(2), by striking 
‘‘JANUARY 3, 2012’’ and inserting ‘‘MARCH 6, 2012’’; and 
(C) in subsection (b)(3), by striking ‘‘June 9, 2012’’ and 
inserting ‘‘August 15, 2012’’. 
(2) Section 2005 of the Assistance for Unemployed Workers 
and Struggling Families Act, as contained in Public Law 111– 
5 (26 U.S.C. 3304 note; 123 Stat. 444), is amended— 
(A) by striking ‘‘January 4, 2012’’ each place it appears 
and inserting ‘‘March 7, 2012’’; and 
(B) in subsection (c), by striking ‘‘June 11, 2012’’ and 
inserting ‘‘August 15, 2012’’. 
(3) Section 5 of the Unemployment Compensation Extension 
Act of 2008 (Public Law 110–449; 26 U.S.C. 3304 note) is amended 
by striking ‘‘June 10, 2012’’ and inserting ‘‘August 15, 2012’’. 
(4) Section 203 of the Federal-State Extended Unemployment 
Compensation Act of 1970 (26 U.S.C. 3304 note) is amended— 
(A) in subsection (d), in the second sentence of the flush 
matter following paragraph (2), by striking ‘‘December 31, 2011’’ 
and inserting ‘‘February 29, 2012’’; and 
26 USC 1401 
note. 
Applicability. 
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125 STAT. 1283 
PUBLIC LAW 112–78—DEC. 23, 2011 
(B) in subsection (f)(2), by striking ‘‘December 31, 2011’’ 
and inserting ‘‘February 29, 2012’’. 
(b) FUNDING.—Section 4004(e)(1) of the Supplemental Appro-
priations Act, 2008 (Public Law 110–252; 26 U.S.C. 3304 note) 
is amended— 
(1) in subparagraph (F), by striking ‘‘and’’ at the end; 
and 
(2) by inserting after subparagraph (G) the following: 
‘‘(H) the amendments made by section 201(a)(1) of the 
Temporary Payroll Tax Cut Continuation Act of 2011; and’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall take effect as if included in the enactment of the Tax Relief, 
Unemployment Insurance Reauthorization, and Job Creation Act 
of 2010 (Public Law 111–312). 
SEC. 202. EXTENDED UNEMPLOYMENT BENEFITS UNDER THE RAIL-
ROAD UNEMPLOYMENT INSURANCE ACT. 
(a) 
EXTENSION.—Section 
2(c)(2)(D)(iii) 
of 
the 
Railroad 
Unemployment Insurance Act, as added by section 2006 of the 
American Recovery and Reinvestment Act of 2009 (Public Law 
111–5) and as amended by section 9 of the Worker, Homeownership, 
and Business Assistance Act of 2009 (Public Law 111–92) and 
section 505 of the Tax Relief, Unemployment Insurance Reauthor-
ization, and Job Creation Act of 2010 (Public Law 111–312), is 
amended— 
(1) by striking ‘‘June 30, 2011’’ and inserting ‘‘August 31, 
2011’’; and 
(2) by striking ‘‘December 31, 2011’’ and inserting ‘‘Feb-
ruary 29, 2012’’. 
(b) CLARIFICATION
ON
AUTHORITY
TO
USE
FUNDS.—Funds 
appropriated under either the first or second sentence of clause 
(iv) of section 2(c)(2)(D) of the Railroad Unemployment Insurance 
Act shall be available to cover the cost of additional extended 
unemployment benefits provided under such section 2(c)(2)(D) by 
reason of the amendments made by subsection (a) as well as to 
cover the cost of such benefits provided under such section 
2(c)(2)(D), as in effect on the day before the date of the enactment 
of this Act. 
TITLE III—TEMPORARY EXTENSION OF 
HEALTH PROVISIONS 
SEC. 301. MEDICARE PHYSICIAN PAYMENT UPDATE. 
Section 1848(d) of the Social Security Act (42 U.S.C. 1395w– 
4(d)) is amended by adding at the end the following new paragraph: 
‘‘(13) UPDATE FOR FIRST TWO MONTHS OF 2012.— 
‘‘(A) IN GENERAL.—Subject to paragraphs (7)(B), (8)(B), 
(9)(B), (10)(B), (11)(B), and (12)(B), in lieu of the update 
to the single conversion factor established in paragraph 
(1)(C) that would otherwise apply for the period beginning 
on January 1, 2012, and ending on February 29, 2012, 
the update to the single conversion factor shall be zero 
percent. 
‘‘(B) NO
EFFECT
ON
COMPUTATION
OF
CONVERSION 
FACTOR FOR REMAINING PORTION OF 2012 AND SUBSEQUENT 
YEARS.—The conversion factor under this subsection shall 
45 USC 352. 
26 USC 3304 
note. 
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125 STAT. 1284 
PUBLIC LAW 112–78—DEC. 23, 2011 
be computed under paragraph (1)(A) for the period begin-
ning on March 1, 2012, and ending on December 31, 2012, 
and for 2013 and subsequent years as if subparagraph 
(A) had never applied.’’. 
SEC. 302. 2-MONTH EXTENSION OF MMA SECTION 508 RECLASSIFICA-
TIONS. 
(a) IN GENERAL.—Section 106(a) of division B of the Tax Relief 
and Health Care Act of 2006 (42 U.S.C. 1395 note), as amended 
by section 117 of the Medicare, Medicaid, and SCHIP Extension 
Act of 2007 (Public Law 110–173), section 124 of the Medicare 
Improvements for Patients and Providers Act of 2008 (Public Law 
110–275), sections 3137(a) and 10317 of the Patient Protection 
and Affordable Care Act (Public Law 111–148), and section 102(a) 
of the Medicare and Medicaid Extenders Act of 2010 (Public Law 
111–309), is amended by striking ‘‘September 30, 2011’’ and 
inserting ‘‘November 30, 2011’’. 
(b) SPECIAL RULE FOR OCTOBER AND NOVEMBER 2011.— 
(1) IN GENERAL.—Subject to paragraph (2), for purposes 
of implementation of the amendment made by subsection (a), 
including for purposes of the implementation of paragraph (2) 
of section 117(a) of the Medicare, Medicaid, and SCHIP Exten-
sion Act of 2007 (Public Law 110–173), for the period beginning 
on October 1, 2011, and ending on November 30, 2011, the 
Secretary of Health and Human Services shall use the hospital 
wage index that was promulgated by the Secretary of Health 
and Human Services in the Federal Register on August 18, 
2011 (76 Fed. Reg. 51476), and any subsequent corrections. 
(2) EXCEPTION.—In determining the wage index applicable 
to hospitals that qualify for wage index reclassification, the 
Secretary shall, for the period beginning on October 1, 2011, 
and ending on November 30, 2011, include the average hourly 
wage data of hospitals whose reclassification was extended 
pursuant to the amendment made by subsection (a) only if 
including such data results in a higher applicable reclassified 
wage index. Any revision to hospital wage indexes made as 
a result of this paragraph shall not be effected in a budget 
neutral manner. 
(c) TIMEFRAME FOR PAYMENTS.—The Secretary shall make pay-
ments required under subsections (a) and (b) by not later than 
December 31, 2012. 
SEC. 303. EXTENSION OF MEDICARE WORK GEOGRAPHIC ADJUSTMENT 
FLOOR. 
Section 1848(e)(1)(E) of the Social Security Act (42 U.S.C. 
1395w–4(e)(1)(E)) is amended by striking ‘‘before January 1, 2012’’ 
and inserting ‘‘before March 1, 2012’’. 
SEC. 304. EXTENSION OF EXCEPTIONS PROCESS FOR MEDICARE 
THERAPY CAPS. 
Section 1833(g)(5) of the Social Security Act (42 U.S.C. 
1395l(g)(5)) is amended by striking ‘‘December 31, 2011’’ and 
inserting ‘‘February 29, 2012’’. 
SEC. 305. EXTENSION OF PAYMENT FOR TECHNICAL COMPONENT OF 
CERTAIN PHYSICIAN PATHOLOGY SERVICES. 
Section 542(c) of the Medicare, Medicaid, and SCHIP Benefits 
Improvement and Protection Act of 2000 (as enacted into law by 
42 USC 1395ww 
note. 
42 USC 1395ww 
note. 
42 USC 1395ww 
note. 
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125 STAT. 1285 
PUBLIC LAW 112–78—DEC. 23, 2011 
section 1(a)(6) of Public Law 106–554), as amended by section 
732 of the Medicare Prescription Drug, Improvement, and Mod-
ernization Act of 2003 (42 U.S.C. 1395w–4 note), section 104 of 
division B of the Tax Relief and Health Care Act of 2006 (42 
U.S.C. 1395w–4 note), section 104 of the Medicare, Medicaid, and 
SCHIP Extension Act of 2007 (Public Law 110–173), section 136 
of the Medicare Improvements for Patients and Providers Act of 
2008 (Public Law 110–275), section 3104 of the Patient Protection 
and Affordable Care Act (Public Law 111–148), and section 105 
of the Medicare and Medicaid Extenders Act of 2010 (Public Law 
111–309), is amended by striking ‘‘and 2011’’ and inserting ‘‘2011, 
and the first two months of 2012’’. 
SEC. 306. EXTENSION OF AMBULANCE ADD-ONS. 
(a) GROUND AMBULANCE.—Section 1834(l)(13)(A) of the Social 
Security Act (42 U.S.C. 1395m(l)(13)(A)) is amended— 
(1) in the matter preceding clause (i), by striking ‘‘January 
1, 2012’’ and inserting ‘‘March 1, 2012’’; and 
(2) in each of clauses (i) and (ii), by striking ‘‘January 
1, 2012’’ and inserting ‘‘March 1, 2012’’ each place it appears. 
(b) AIR
AMBULANCE.—Section 146(b)(1) of the Medicare 
Improvements for Patients and Providers Act of 2008 (Public Law 
110–275), as amended by sections 3105(b) and 10311(b) of Public 
Law 111–148 and section 106(b) of the Medicare and Medicaid 
Extenders Act of 2010 (Public Law 111–309), is amended by striking 
‘‘December 31, 2011’’ and inserting ‘‘February 29, 2012’’. 
(c) SUPER RURAL AMBULANCE.—Section 1834(l)(12)(A) of the 
Social Security Act (42 U.S.C. 1395m(l)(12)(A)) is amended by 
striking ‘‘January 1, 2012’’ and inserting ‘‘March 1, 2012’’. 
SEC. 307. EXTENSION OF PHYSICIAN FEE SCHEDULE MENTAL HEALTH 
ADD-ON PAYMENT. 
Section 138(a)(1) of the Medicare Improvements for Patients 
and Providers Act of 2008 (Public Law 110–275), as amended by 
section 3107 of the Patient Protection and Affordable Care Act 
(Public Law 111–148) and section 107 of the Medicare and Medicaid 
Extenders Act of 2010 (Public Law 111–309), is amended by striking 
‘‘December 31, 2011’’ and inserting ‘‘February 29, 2012’’. 
SEC. 308. EXTENSION OF OUTPATIENT HOLD HARMLESS PROVISION. 
Section 1833(t)(7)(D)(i) of the Social Security Act (42 U.S.C. 
1395l(t)(7)(D)(i)), as amended by section 3121(a) of the Patient 
Protection and Affordable Care Act (Public Law 111–148) and sec-
tion 108 of the Medicare and Medicaid Extenders Act of 2010 
(Public Law 111–309), is amended— 
(1) in subclause (II)— 
(A) in the first sentence, by striking ‘‘January 1, 2012’’ 
and inserting ‘‘March 1, 2012’’; and 
(B) in the second sentence, by striking ‘‘or 2011’’ and 
inserting ‘‘2011, or the first two months of 2012’’; and 
(2) in subclause (III)— 
(A) in the first sentence, by striking ‘‘2009, and’’ and 
all that follows through ‘‘for which’’ and inserting ‘‘2009, 
and before March 1, 2012, for which’’; and 
(B) in the second sentence, by striking ‘‘2010, and’’ 
and all that follows through ‘‘the preceding’’ and inserting 
‘‘2010, and before March 1, 2012, the preceding’’. 
42 USC 1395w–4 
note. 
42 USC 1395m 
note. 
42 USC 1395w–4 
note. 
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125 STAT. 1286 
PUBLIC LAW 112–78—DEC. 23, 2011 
SEC. 309. EXTENDING MINIMUM PAYMENT FOR BONE MASS MEASURE-
MENT. 
Section 1848 of the Social Security Act (42 U.S.C. 1395w– 
4) is amended— 
(1) in subsection (b)— 
(A) in paragraph (4)(B), by striking ‘‘and 2011’’ and 
inserting ‘‘, 2011, and the first 2 months of 2012’’; and 
(B) in paragraph (6)— 
(i) in the matter preceding subparagraph (A), by 
striking ‘‘and 2011’’ and inserting ‘‘, 2011, and the 
first 2 months of 2012’’; and 
(ii) in subparagraph (C), by striking ‘‘and 2011’’ 
and inserting ‘‘, 2011, and the first 2 months of 2012’’; 
and 
(2) in subsection (c)(2)(B)(iv)(IV), by striking ‘‘or 2011’’ and 
inserting ‘‘, 2011, or the first 2 months of 2012’’. 
SEC. 310. EXTENSION OF THE QUALIFYING INDIVIDUAL (QI) PROGRAM. 
(a) EXTENSION.—Section 1902(a)(10)(E)(iv) of the Social Security 
Act (42 U.S.C. 1396a(a)(10)(E)(iv)) is amended by striking 
‘‘December 2011’’ and inserting ‘‘February 2012’’. 
(b) EXTENDING TOTAL AMOUNT AVAILABLE FOR ALLOCATION.— 
Section 1933(g) of such Act (42 U.S.C. 1396u–3(g)) is amended— 
(1) in paragraph (2)— 
(A) by striking ‘‘and’’ at the end of subparagraph (O); 
(B) in subparagraph (P), by striking the period at the 
end and inserting ‘‘; and’’; and 
(C) by adding at the end the following new subpara-
graph: 
‘‘(Q) for the period that begins on January 1, 2012, 
and ends on February 29, 2012, the total allocation amount 
is $150,000,000.’’. 
SEC. 311. EXTENSION OF TRANSITIONAL MEDICAL ASSISTANCE (TMA). 
Sections 1902(e)(1)(B) and 1925(f) of the Social Security Act 
(42 U.S.C. 1396a(e)(1)(B), 1396r–6(f)) are each amended by striking 
‘‘December 31, 2011’’ and inserting ‘‘February 29, 2012’’. 
SEC. 312. EXTENSION OF THE TEMPORARY ASSISTANCE FOR NEEDY 
FAMILIES PROGRAM. 
Activities authorized by part A of title IV and section 1108(b) 
of the Social Security Act (other than under subsections (a)(3) 
and (b) of section 403 of such Act) shall continue through February 
29, 2012, in the manner authorized for fiscal year 2011, and out 
of any money in the Treasury of the United States not otherwise 
appropriated, there are hereby appropriated such sums as may 
be necessary for such purpose. Grants and payments may be made 
pursuant to this authority through the applicable portion of the 
second quarter of fiscal year 2012 at the pro rata portion of the 
level provided for such activities through the second quarter of 
fiscal year 2011. 
Appropriation 
authorization. 
Time period. 
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125 STAT. 1287 
PUBLIC LAW 112–78—DEC. 23, 2011 
TITLE IV—MORTGAGE FEES AND 
PREMIUMS 
SEC. 401. GUARANTEE FEES. 
Subpart A of part 2 of subtitle A of title XIII of the Housing 
and Community Development Act of 1992 is amended by adding 
after section 1326 (12 U.S.C. 4546) the following new section: 
‘‘SEC. 1327. ENTERPRISE GUARANTEE FEES. 
‘‘(a) DEFINITIONS.—For purposes of this section, the following 
definitions shall apply: 
‘‘(1) GUARANTEE FEE.—The term ‘guarantee fee’— 
‘‘(A) means a fee described in subsection (b); and 
‘‘(B) includes— 
‘‘(i) the guaranty fee charged by the Federal 
National Mortgage Association with respect to mort-
gage-backed securities; and 
‘‘(ii) the management and guarantee fee charged 
by the Federal Home Loan Mortgage Corporation with 
respect to participation certificates. 
‘‘(2) AVERAGE FEES.—The term ‘average fees’ means the 
average contractual fee rate of single-family guaranty arrange-
ments by an enterprise entered into during 2011, plus the 
recognition of any up-front cash payments over an estimated 
average life, expressed in terms of basis points. Such definition 
shall be interpreted in a manner consistent with the annual 
report on guarantee fees by the Federal Housing Finance 
Agency. 
‘‘(b) INCREASE.— 
‘‘(1) IN GENERAL.— 
‘‘(A) PHASED
INCREASE
REQUIRED.—Subject to sub-
section (c), the Director shall require each enterprise to 
charge a guarantee fee in connection with any guarantee 
of the timely payment of principal and interest on securi-
ties, notes, and other obligations based on or backed by 
mortgages on residential real properties designed prin-
cipally for occupancy of from 1 to 4 families, consummated 
after the date of enactment of this section. 
‘‘(B) AMOUNT.—The amount of the increase required 
under this section shall be determined by the Director 
to appropriately reflect the risk of loss, as well the cost 
of capital allocated to similar assets held by other fully 
private regulated financial institutions, but such amount 
shall be not less than an average increase of 10 basis 
points for each origination year or book year above the 
average fees imposed in 2011 for such guarantees. The 
Director shall prohibit an enterprise from offsetting the 
cost of the fee to mortgage originators, borrowers, and 
investors by decreasing other charges, fees, or premiums, 
or in any other manner. 
‘‘(2) AUTHORITY
TO
LIMIT
OFFER
OF
GUARANTEE.—The 
Director shall prohibit an enterprise from consummating any 
offer for a guarantee to a lender for mortgage-backed securities, 
if— 
‘‘(A) the guarantee is inconsistent with the require-
ments of this section; or 
Applicability. 
12 USC 4547. 
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125 STAT. 1288 
PUBLIC LAW 112–78—DEC. 23, 2011 
‘‘(B) the risk of loss is allowed to increase, through 
lowering of the underwriting standards or other means, 
for the primary purpose of meeting the requirements of 
this section. 
‘‘(3) DEPOSIT
IN
TREASURY.—Amounts received from fee 
increases imposed under this section shall be deposited directly 
into the United States Treasury, and shall be available only 
to the extent provided in subsequent appropriations Acts. The 
fees charged pursuant to this section shall not be considered 
a reimbursement to the Federal Government for the costs or 
subsidy provided to an enterprise. 
‘‘(c) PHASE-IN.— 
‘‘(1) IN GENERAL.—The Director may provide for compliance 
with subsection (b) by allowing each enterprise to increase 
the guarantee fee charged by the enterprise gradually over 
the 2-year period beginning on the date of enactment of this 
section, in a manner sufficient to comply with this section. 
In determining a schedule for such increases, the Director 
shall— 
‘‘(A) provide for uniform pricing among lenders; 
‘‘(B) provide for adjustments in pricing based on risk 
levels; and 
‘‘(C) take into consideration conditions in financial mar-
kets. 
‘‘(2) RULE OF CONSTRUCTION.—Nothing in this subsection 
shall be interpreted to undermine the minimum increase 
required by subsection (b). 
‘‘(d) INFORMATION COLLECTION AND ANNUAL ANALYSIS.—The 
Director shall require each enterprise to provide to the Director, 
as part of its annual report submitted to Congress— 
‘‘(1) a description of— 
‘‘(A) changes made to up-front fees and annual fees 
as part of the guarantee fees negotiated with lenders; 
‘‘(B) changes to the riskiness of the new borrowers 
compared to previous origination years or book years; and 
‘‘(C) any adjustments required to improve for future 
origination years or book years, in order to be in complete 
compliance with subsection (b); and 
‘‘(2) an assessment of how the changes in the guarantee 
fees described in paragraph (1) met the requirements of sub-
section (b). 
‘‘(e) ENFORCEMENT.— 
‘‘(1) REQUIRED ADJUSTMENTS.—Based on the information 
from subsection (d) and any other information the Director 
deems necessary, the Director shall require an enterprise to 
make adjustments in its guarantee fee in order to be in compli-
ance with subsection (b). 
‘‘(2) NONCOMPLIANCE
PENALTY.—An enterprise that has 
been found to be out of compliance with subsection (b) for 
any 2 consecutive years shall be precluded from providing any 
guarantee for a period, determined by rule of the Director, 
but in no case less than 1 year. 
‘‘(3) RULE OF CONSTRUCTION.—Nothing in this subsection 
shall be interpreted as preventing the Director from initiating 
and implementing an enforcement action against an enterprise, 
at a time the Director deems necessary, under other existing 
enforcement authority. 
Reports. 
Time period. 
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125 STAT. 1289 
PUBLIC LAW 112–78—DEC. 23, 2011 
‘‘(f) EXPIRATION.—The provisions of this section shall expire 
on October 1, 2021.’’. 
SEC. 402. FHA GUARANTEE FEES. 
(a) AMENDMENT.—Section 203(c)(2) of the National Housing 
Act (12 U.S.C. 1709(c)(2)) is amended by adding at the end the 
following: 
‘‘(C)(i) In addition to the premiums under subparagraphs 
(A) and (B), the Secretary shall establish and collect annual 
premium payments for any mortgage for which the Secretary 
collects an annual premium payment under subparagraph (B), 
in an amount described in clause (ii). 
‘‘(ii)(I) Subject to subclause (II), with respect to a mortgage, 
the amount described in this clause is 10 basis points of the 
remaining insured principal balance (excluding the portion of 
the remaining balance attributable to the premium collected 
under subparagraph (A) and without taking into account delin-
quent payments or prepayments). 
‘‘(II) During the 2-year period beginning on the date of 
enactment of this subparagraph, the Secretary shall increase 
the number of basis points of the annual premium payment 
collected under this subparagraph incrementally, as determined 
appropriate by the Secretary, until the number of basis points 
of the annual premium payment collected under this subpara-
graph is equal to the number described in subclause (I).’’. 
(b) PROSPECTIVE REPEAL.—Section 203(c)(2) of the National 
Housing Act (12 U.S.C. 1709(c)(2)) is amended by striking subpara-
graph (C), as added by subsection (a), effective on October 1, 2021. 
(c) REPORT REQUIRED.—Not later than 30 days before the date 
on which the Secretary of Housing and Urban Development makes 
a determination under subsection (b)(2), the Secretary shall submit 
to the Committee on Banking, Housing, and Urban Affairs of the 
Senate and the Committee on Financial Services of the House 
of Representatives a report that— 
(1) explains the basis for the determination; and 
(2) identifies the date on which the Secretary plans to 
make the determination. 
TITLE V—OTHER PROVISIONS 
Subtitle A—Keystone XL Pipeline 
SEC. 501. PERMIT FOR KEYSTONE XL PIPELINE. 
(a) IN GENERAL.—Except as provided in subsection (b), not 
later than 60 days after the date of enactment of this Act, the 
President, acting through the Secretary of State, shall grant a 
permit under Executive Order No. 13337 (3 U.S.C. 301 note; relating 
to issuance of permits with respect to certain energy-related facili-
ties and land transportation crossings on the international bound-
aries of the United States) for the Keystone XL pipeline project 
application filed on September 19, 2008 (including amendments). 
(b) EXCEPTION.— 
(1) IN GENERAL.—The President shall not be required to 
grant the permit under subsection (a) if the President deter-
mines that the Keystone XL pipeline would not serve the 
national interest. 
Determination. 
Deadline. 
President. 
Determination. 
12 USC 1709 
note. 
Effective date. 
Time period. 
Determination. 
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125 STAT. 1290 
PUBLIC LAW 112–78—DEC. 23, 2011 
(2) REPORT.—If the President determines that the Keystone 
XL pipeline is not in the national interest under paragraph 
(1), the President shall, not later than 15 days after the date 
of the determination, submit to the Committee on Foreign 
Relations of the Senate, the Committee on Foreign Affairs 
of the House of Representatives, the majority leader of the 
Senate, the minority leader of the Senate, the Speaker of the 
House of Representatives, and the minority leader of the House 
of Representatives a report that provides a justification for 
determination, including consideration of economic, employ-
ment, energy security, foreign policy, trade, and environmental 
factors. 
(3) EFFECT OF NO FINDING OR ACTION.—If a determination 
is not made under paragraph (1) and no action is taken by 
the President under subsection (a) not later than 60 days 
after the date of enactment of this Act, the permit for the 
Keystone XL pipeline described in subsection (a) that meets 
the requirements of subsections (c) and (d) shall be in effect 
by operation of law. 
(c) REQUIREMENTS.—The permit granted under subsection (a) 
shall require the following: 
(1) The permittee shall comply with all applicable Federal 
and State laws (including regulations) and all applicable indus-
trial codes regarding the construction, connection, operation, 
and maintenance of the United States facilities. 
(2) The permittee shall obtain all requisite permits from 
Canadian authorities and relevant Federal, State, and local 
governmental agencies. 
(3) The permittee shall take all appropriate measures to 
prevent or mitigate any adverse environmental impact or 
disruption of historic properties in connection with the construc-
tion, operation, and maintenance of the United States facilities. 
(4) For the purpose of the permit issued under subsection 
(a) (regardless of any modifications under subsection (d))— 
(A) the final environmental impact statement issued 
by the Secretary of State on August 26, 2011, satisfies 
all requirements of the National Environmental Policy Act 
of 1969 (42 U.S.C. 4321 et seq.) and section 106 of the 
National Historic Preservation Act (16 U.S.C. 470f); 
(B) any modification required by the Secretary of State 
to the Plan described in paragraph (5)(A) shall not require 
supplementation of the final environmental impact state-
ment described in that paragraph; and 
(C) no further Federal environmental review shall be 
required. 
(5) The construction, operation, and maintenance of the 
facilities shall be in all material respects similar to that 
described in the application described in subsection (a) and 
in accordance with— 
(A) the construction, mitigation, and reclamation meas-
ures agreed to by the permittee in the Construction Mitiga-
tion and Reclamation Plan found in appendix B of the 
final environmental impact statement issued by the Sec-
retary of State on August 26, 2011, subject to the modifica-
tion described in subsection (d); 
(B) the special conditions agreed to between the per-
mittee and the Administrator of the Pipeline Hazardous 
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125 STAT. 1291 
PUBLIC LAW 112–78—DEC. 23, 2011 
Materials Safety Administration of the Department of 
Transportation found in appendix U of the final environ-
mental impact statement described in subparagraph (A); 
(C) if the modified route submitted by the Governor 
of Nebraska under subsection (d)(3)(B) crosses the Sand 
Hills region, the measures agreed to by the permittee for 
the Sand Hills region found in appendix H of the final 
environmental impact statement described in subparagraph 
(A); and 
(D) the stipulations identified in appendix S of the 
final environmental impact statement described in subpara-
graph (A). 
(6) Other requirements that are standard industry practice 
or commonly included in Federal permits that are similar to 
a permit issued under subsection (a). 
(d) MODIFICATION.—The permit issued under subsection (a) 
shall require— 
(1) the reconsideration of routing of the Keystone XL pipe-
line within the State of Nebraska; 
(2) a review period during which routing within the State 
of Nebraska may be reconsidered and the route of the Keystone 
XL pipeline through the State altered with any accompanying 
modification to the Plan described in subsection (c)(5)(A); and 
(3) the President— 
(A) to coordinate review with the State of Nebraska 
and provide any necessary data and reasonable technical 
assistance material to the review process required under 
this subsection; and 
(B) to approve the route within the State of Nebraska 
that has been submitted to the Secretary of State by the 
Governor of Nebraska. 
(e) EFFECT OF NO APPROVAL.—If the President does not approve 
the route within the State of Nebraska submitted by the Governor 
of Nebraska under subsection (d)(3)(B) not later than 10 days 
after the date of submission, the route submitted by the Governor 
of Nebraska under subsection (d)(3)(B) shall be considered approved, 
pursuant to the terms of the permit described in subsection (a) 
that meets the requirements of subsection (c) and this subsection, 
by operation of law. 
(f) PRIVATE PROPERTY SAVINGS CLAUSE.—Nothing in this sec-
tion alters the Federal, State, or local processes or conditions in 
effect on the date of enactment of this Act that are necessary 
to secure access from private property owners to construct the 
Keystone XL pipeline. 
Subtitle B—Budgetary Provisions 
SEC. 511. SENATE POINT OF ORDER AGAINST AN EMERGENCY DES-
IGNATION. 
Section 314 of the Congressional Budget Act of 1974 is amended 
by— 
(1) redesignating subsection (e) as subsection (f); and 
(2) inserting after subsection (d) the following: 
‘‘(e) SENATE POINT OF ORDER AGAINST AN EMERGENCY DESIGNA-
TION.— 
2 USC 645. 
Nebraska. 
Nebraska. 
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125 STAT. 1292 
PUBLIC LAW 112–78—DEC. 23, 2011 
‘‘(1) IN GENERAL.—When the Senate is considering a bill, 
resolution, amendment, motion, amendment between the 
Houses, or conference report, if a point of order is made by 
a Senator against an emergency designation in that measure, 
that provision making such a designation shall be stricken 
from the measure and may not be offered as an amendment 
from the floor. 
‘‘(2) SUPERMAJORITY WAIVER AND APPEALS.— 
‘‘(A) WAIVER.—Paragraph (1) may be waived or sus-
pended in the Senate only by an affirmative vote of three- 
fifths of the Members, duly chosen and sworn. 
‘‘(B) APPEALS.—Appeals in the Senate from the 
decisions of the Chair relating to any provision of this 
subsection shall be limited to 1 hour, to be equally divided 
between, and controlled by, the appellant and the manager 
of the bill or joint resolution, as the case may be. An 
affirmative vote of three-fifths of the Members of the 
Senate, duly chosen and sworn, shall be required to sustain 
an appeal of the ruling of the Chair on a point of order 
raised under this subsection. 
‘‘(3) DEFINITION OF AN EMERGENCY DESIGNATION.—For pur-
poses of paragraph (1), a provision shall be considered an 
emergency designation if it designates any item pursuant to 
section 251(b)(2)(A)(i) of the Balanced Budget and Emergency 
Deficit Control Act of 1985. 
‘‘(4) FORM OF THE POINT OF ORDER.—A point of order under 
paragraph (1) may be raised by a Senator as provided in 
section 313(e) of the Congressional Budget Act of 1974. 
‘‘(5) CONFERENCE REPORTS.—When the Senate is consid-
ering a conference report on, or an amendment between the 
Houses in relation to, a bill, upon a point of order being made 
by any Senator pursuant to this section, and such point of 
order being sustained, such material contained in such con-
ference report shall be deemed stricken, and the Senate shall 
proceed to consider the question of whether the Senate shall 
recede from its amendment and concur with a further amend-
ment, or concur in the House amendment with a further amend-
ment, as the case may be, which further amendment shall 
consist of only that portion of the conference report or House 
amendment, as the case may be, not so stricken. Any such 
motion in the Senate shall be debatable. In any case in which 
such point of order is sustained against a conference report 
(or Senate amendment derived from such conference report 
by operation of this subsection), no further amendment shall 
be in order.’’. 
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125 STAT. 1293 
PUBLIC LAW 112–78—DEC. 23, 2011 
LEGISLATIVE HISTORY—H.R. 3765: 
CONGRESSIONAL RECORD, Vol. 157 (2011): 
Dec. 23, considered and passed House and Senate. 
SEC. 512. PAYGO SCORECARD ESTIMATES. 
The budgetary effects of this Act shall not be entered on either 
PAYGO scorecard maintained pursuant to section 4(d) of the Statu-
tory Pay-As-You-Go Act of 2010. 
Approved December 23, 2011. 
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