Detailed Instructions: In this task, you are given text for US Congressional and California state bills, your task is to generate a summary for this bill.
Q: SECTION 1. SHORT TITLE.

This Act may be cited as the ''Accounts Receivable Insurance
Program Act''.

SEC. 2. FINDINGS.

Congress finds the following:
(1) Small manufacturers are hurt much more than their
larger competitors when delays in payments of accounts
receivable occur. These small firms hold millions of dollars in
outstanding receivables. Especially in an economic slowdown,
many larger firms delay payments to their downstream suppliers
causing disruptions in the domestic industrial supply chain,
creating a greater need to insure payment on terms.
(2) As the number and size of accounts receivables
outstanding increases, these businesses have fewer resources to
buy raw materials, hire workers, and access adequate lines of
credit. Small manufacturers and their creditors need additional
assurance that customers will pay their accounts on reasonable
terms.
(3) Failure of payment to downstream suppliers in a
reasonable amount of time has had a significant negative impact
on the cash flow of small suppliers. The moment a lender sees
that a supplier is involved in a financially troubled industry
such as the auto industry, they move the supplier into a high
risk category or will not extend credit. Government guaranteed
account receivables insurance would allow the middle-market
companies access to credit lines they need to continue day-to-
day operations.

SEC. 3. DEFINITIONS.

For the purpose of this Act the following definitions apply:
(1) Financial institution.--The term ''financial
institution'' means an establishment engaged in financial
transactions (transactions involving the creation, liquidation,
or change in ownership of financial assets) and/or in
facilitating financial transactions.
(2) Insurance institution.--The term ''insurance
institution'' means an establishment that is primarily engaged
in one of the following:
(A) Underwriting (assuming the risk, assigning
premiums, and so forth) annuities and insurance
policies.
(B) Facilitating such underwriting by selling
insurance policies, and by providing other insurance
and employee-benefit related services.
(3) Guarantee.--The term ''guarantee'' has the same meaning
as is given the term ''loan guarantee'' in section 502(3) of
the Federal Credit Reform Act of 1990 (2 U.S.C. 661a(3)).
(4) Secretary.--The term ''Secretary'' means the Secretary
of the Treasury.

SEC. 4. ACCOUNTS RECEIVABLE INSURANCE.

(a) Establishment of Program.--There is established within the
Department of the Treasury a government-backed private accounts
receivable insurance program to assist small manufacturers in the
underwriting and guarantee of payment on terms through the insurance of
their accounts receivable.
(b) Terms and Conditions.--
(1) Guarantee.--The Secretary shall, to the extent amounts
are made available under subsection (c), insure accounts
receivable underwritten by financial or insurance institutions
for small manufacturing businesses.
(2) Application.--
(A) A small manufacturing business shall submit an
application to a financial or insurance institution for
participation in the program established under this
section at such time, in such manner, and accompanied
by such information as the Secretary may require.
(B) A financial or insurance institution shall not
deny an application solely based on a small
manufacturing business's lack of short term positive
cash flow or solely on the nature of their customers'
industry classification.
(3) Default.--If a small manufacturing business defaults on
any portion of an obligation guaranteed under paragraph (1)--
(A) the financial or insurance institution shall
have the right to demand payment of the unpaid amount
from the Secretary in exchange for payment of a fee
equal to .5 percent of such amount; and
(B) within such period as the Secretary shall
specify, the Secretary shall pay to the financial or
insurance institution the remaining balance of the
obligation, unless the Secretary determines that such
small business or institution has not taken reasonable
steps to seek collection of such obligation in a
reasonably timely manner, which steps shall include--
(i) exhausting all efforts to enforce all
terms and penalties set forth in the underlying
contract;
(ii) making successive efforts by
registered mail or other similar method on a
regular schedule; and
(iii) pursuing legal action.
(4) Limitation.--A financial or insurance institution shall
not be eligible for a guarantee under paragraph (1) if such
institution insured the accounts receivable of a small
manufacturing business for less than 80 percent of the value of
such accounts receivable insured.
(c) Funding.--Funding as may be necessary, not to exceed
$500,000,000, for the cost of guarantees under this section shall be
available to the Secretary, without further appropriation or fiscal
year limitation, for the costs of such program. All funds received by
the Secretary in connection with purchases made pursuant to paragraph
(1), including interest payments, dividend payments, and proceeds from
the sale of any financial instrument, shall be paid into the general
fund of the Treasury for reduction of the public debt.
(d) Sunset.--The Secretary may not enter into any contracts or
agreements with financial institutions to make any guarantees under
this section after December 31, 2011, or on the date that is 1 year
after the date of the enactment of this Act, whichever is later.
(e) Regulations.--Not later than 90 days after the date of the
enactment of this Act, the Secretary shall issue regulations to carry
out the purposes of this section.
A:
Accounts Receivable Insurance Program Act - Establishes within the Treasury a government-backed private accounts receivable insurance program to assist small manufacturers in the underwriting and guarantee of payment through the insurance of their accounts receivable. Directs the Secretary of the Treasury to insure (guarantee) accounts receivable underwritten by financial or insurance institutions for small manufacturing businesses and, if a small manufacturing business defaults, to pay such an institution any remaining balance of an obligation of a small manufacturing business that is covered under the insurance. Prohibits a financial or insurance institution from being eligible for a guarantee under the program if the institution insured the accounts receivable of a small manufacturing business for less than 80% of their value.

Provides program funding. Prohibits the Secretary from entering into guarantees with institutions under the program after December 31, 2011, or one year after the enactment of this Act, whichever is later.