text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``State and Local Government Economic 
  Empowerment Act''.
  
  SEC. 2. FINDINGS.
  
      The Congress hereby finds the following:
              (1) As of the date of the enactment of this Act, money is 
          principally created in the domestic economy by banks through 
          the process known as ``deposit expansion'' under which credit 
          is extended by banks to customers in exchange for the 
          assumption of an obligation by each customer to repay the 
          amount of any such credit with interest.
              (2) The creation of money through the extension of credit 
          and creation of debt, a traditional banking function, preceded 
          the establishment by the Congress of, first, the national 
          banking system and, subsequently, the Federal Reserve System.
              (3) The constitutional authority to create and regulate 
          money does not limit the Federal Government to creating money 
          through the production of coins or currency or the process of 
          debt creation but, except for a brief period during the 
          administration of President Lincoln, the Federal Government has 
          not exercised such authority more broadly.
              (4) The creation of money by the banks in conjunction with 
          the Federal reserve banks does not limit the constitutional 
          authority of the Congress to create Government credit funds in 
          the form of noninterest bearing credit to fund a legislatively 
          approved program or prevent the Congress from creating such 
          funds.
              (5) The creation of noninterest-bearing government credit 
          funds in measured or limited increments for the purpose of 
          funding capital and environmental projects in the public 
          interest--
                      (A) will allow projects to be built for \1/2\ to 
                  \1/3\ the normal cost; and
                      (B) will allow more necessary projects to be built 
                  at a lower cost to the taxpayers and at the same time 
                  build additional wealth in the communities where such 
                  projects are located.
  
  SEC. 3. CREATION OF MONEY.
  
      (a) In General.--Pursuant to the exercise by the Congress of the 
  authority contained in the 5th clause of section 8 of Article I of the 
  Constitution, the Secretary of the Treasury shall have money available 
  for purposes of this Act in an amount equal to the product of--
              (1) the population of the United States, as determined by 
          the Secretary of Commerce on the basis of the 1990 census; and
              (2) $1,400.
      (b) Loan Agreement.--The money referred to in section 3(a) shall be 
  created by having the Secretary of the Treasury and the Board of 
  Governors of the Federal Reserve System enter into a Loan Agreement in 
  accordance with the following requirements:
              (1) The Board shall lend the United States Treasury an 
          amount up to a total of $360,000,000,000 at the rate of not 
          more than $72,000,000,000 per annum (on a cumulative basis) in 
          each of the 5 years commencing 60 days after the date of the 
          enactment of this Act.
              (2) The Secretary of the Treasury shall pay an annual fee 
          to the Board (the amount to be negotiated between the Secretary 
          and the Board) to cover the administrative costs the Board 
          incurs in acting as the agent of the Administrator appointed 
          under section 4(b). The amount of this administration fee each 
          year shall be charged to the recipients of the noninterest 
          bearing loans made to them during the year pursuant to section 
          7(e), pro rata to the amount of such loans.
      (c) Exercise of Sovereign Capacity to Create Money.--
              (1) In general.--Any amount made available pursuant to this 
          Act shall be treated as money created in the sovereign and 
          exclusive capacity of the United States, in accordance with the 
          Constitution, to create money.
              (2) Expenditure of tax revenue or borrowed funds not 
          authorized.--No provision of this Act shall be construed as 
          authorizing the expenditure of funds derived from revenues 
          imposed and collected by the United States Government under any 
          provision of law or from amounts borrowed by the United States 
          Government pursuant to chapter 31 of title 31, United States 
          Code, or any other provision of law.
      (d) Budget Treatment.--
              (1) Nonapplicability of provisions applicable to receipt 
          and expenditures of revenue and borrowed funds.--For purposes 
          of title 31, United States Code, the Congressional Budget and 
          Impoundment Control Act of 1974, the Balanced Budget and 
          Emergency Deficit Control Act of 1985, the Budget Enforcement 
          Act of 1990, or any other provision of law--
                      (A) money created under this section shall not be 
                  treated as revenue when it is created or made available 
                  to the Administrator under section 4(b) nor shall it be 
                  treated as revenue by the Administrator or by the 
                  Secretary of the Treasury when the loans referred to in 
                  section 6 are repaid;
                      (B) the money created under this section and the 
                  interest-free loan program established under section 
                  6--
                              (i) shall not be treated as budget 
                          authority, new budget authority, budgetary 
                          resources, spending authority, new spending 
                          authority, entitlement authority, or credit 
                          authority;
                              (ii) shall not be subject to apportionment 
                          or sequestration other than in accordance with 
                          the provisions of sections 4, 5, and 6; and
                              (iii) shall not be taken into account in 
                          the determination of the baseline for any 
                          fiscal year; and
                      (C) the disbursement of money created under this 
                  section shall not be treated as an outlay or a budget 
                  outlay.
      (e) Bank Reserve Requirements.--No provision of this Act shall be 
  construed as affecting any authority of the Board to adjust bank 
  reserve requirements, as appropriate.
  
  SEC. 4. ADMINISTRATION OF THE ACT.
  
      (a) In General.--The Administrator of this Act shall be under the 
  Department of the Treasury.
      (b) Management.--An Administrator shall be appointed by, and 
  accountable to, the Secretary of the Treasury.
      (c) Duties of Administrator.--
              (1) In general.--The Administrator shall be solely 
          responsible for disbursing, pursuant to section 6, funds 
          created under this Act and otherwise carrying out the duties 
          imposed under this Act.
              (2) Appointment of agent.--The Administrator may appoint 
          the Board or any Federal reserve bank as an agent of the 
          Administrator to perform such duties of the Administrator under 
          this Act that the Administrator sees fit to delegate to the 
          Board or any such bank.
      (d) United States Government General Checking Account.--
              (1) Deposit.--Checks drawn on the money created under 
          section 3 shall be deposited to the credit of the United States 
          Government in a United States Government general checking 
          account at a Federal reserve bank.
              (2) Disbursements from account.--All disbursements of loans 
          under section 6 shall be made with United States Government 
          checks from the account referred to in paragraph (1).
      (e) Loan Repayment Account.--The Administrator shall establish and 
  maintain a separate checking account in a Federal reserve bank for the 
  deposit of any repayment of principal on loans made under section 6.
  
  SEC. 5. ELIGIBILITY OF STATE AND LOCAL GOVERNMENTS FOR INTEREST-FREE 
                LOANS.
  
      (a) In General.--Subject to subsection (b), each State, county, 
  township, incorporated municipality, school district, and Indian tribe 
  shall be entitled to obtain a loan from the Administrator in accordance 
  with section 6, unless such unit of government is delinquent in 
  repaying a prior loan.
      (b) Maximum Amount Limitation.--The total amount of money to which 
  any entity described in subsection (a) is eligible to borrow under this 
  section shall not exceed the amount equal to the product of--
              (1) the resident population, as determined by the Secretary 
          of Commerce on the basis of the 1990 census, of the geographic 
          territory over which the entity has jurisdiction (or, in the 
          case of a school district, the latest official enrollment 
          figures as reported to the State in which the school district 
          resides); and
              (2) the amount equal to--
                      (A) in the case of a State, $200;
                      (B) in the case of a county (as defined in section 
                  2 of title 1, United States Code), $100; if the State 
                  has no township form of government, this amount shall 
                  be $200;
                      (C) in the case of an incorporated municipality, 
                  $600;
                      (D) in the case of any township, $100;
                      (E) in the case of any school district, $2,400; and
                      (F) in the case of an Indian tribe, $1,000.
  
  SEC. 6. ISSUANCE OF INTEREST-FREE LOANS.
  
      Subject to sections 5(b) and 7, the Administrator shall issue an 
  interest-free loan from the money created under section 3 to any 
  government unit described in section 5(a) if the Administrator obtains 
  such assurances as the Administrator determines to be appropriate from 
  the unit that--
              (1) the proceeds of such loan will be used solely for the 
          purpose of--
                      (A) funding capital projects of the governmental 
                  unit, including the construction of or improvements 
                  to--
                              (i) school facilities;
                              (ii) streets, highways, bridges, and 
                          tunnels;
                              (iii) water and sewer systems;
                              (iv) waste disposal systems;
                              (v) public housing facilities;
                              (vi) public buildings and other public 
                          facilities; and
                              (vii) environmental facilities; or
                      (B) the cleanup of toxic waste sites or other 
                  environmental improvements.
  
  SEC. 7. ADMINISTRATIVE PROVISIONS.
  
      (a) Disbursement Requirements.--Loans made under section 6 shall be 
  disbursed by the Administrator--
              (1) in a lump sum for the full amount of the loan; or
              (2) if the Administrator determines that partial 
          disbursements are appropriate in the case of loans for 
          construction projects in order to accommodate a greater number 
          of loan requests, over the construction period of the project.
      (b) Minimum Phase-In Period.--Disbursements on all eligible loans 
  approved under section 6 shall begin before the end of the 5-year 
  period beginning on the date of the enactment of this Act.
      (c) Period to Maturity.--The period to maturity of any loan made 
  under section 6 shall be the estimated number of years of the useful 
  life of the infrastructure installation (if any) which is financed by 
  the loan, but, in any case, shall be a minimum of 10 years and a 
  maximum of 30 years.
      (d) Applicability of State Law.--The number or the principal 
  amounts of interest-free loans made under section 6 to any governmental 
  unit established by a State, or the period to maturity of any such 
  loan, may not exceed the maximum number, amount, or period to maturity 
  established under the law of such State, unless the State provides a 
  waiver from any such limitation with respect to any such governmental 
  unit.
      (e) Administrative Fees.--The Administrator shall impose an 
  administrative fee on each recipient of a loan under section 6 in an 
  amount not to exceed the lesser of--
              (1) 0.25 percent of the total amount of the loan; or
              (2) the amount sufficient to cover all administrative costs 
          incurred by the Administrator, including overhead, for making 
          and administering that particular loan.
      (f) Terms of Repayment.--The repayment terms of any loan under 
  section 6 shall require quarterly payments by the recipient in equal 
  amounts determined by dividing--
              (1) the sum of the principal and the administrative fees 
          applicable with respect to such loan; by
              (2) the number of calendar quarters any portion of which 
          falls within the period to maturity of the loan.
      (g) Collections of Past Due Amounts and Collection Fees.--
              (1) Enforced collections.--The Administrator shall take 
          action to enforce collection of past due amounts of any loan on 
          which 4 or more quarterly payments are due and payable.
              (2) Impoundment of delinquent amount.--In the case of any 
          delinquent loan described in paragraph (1), the Administrator 
          may seek an order from any district court of the United States 
          of appropriate jurisdiction directing a United States marshall 
          to impound, under authority of this section, any available 
          funds of the debtor in an amount equal to the amount currently 
          due as of the date of such action to reduce or eliminate the 
          delinquency.
              (3) Waiver of debtor's right to defend against 
          collection.--As a condition for receiving any loan under 
          section 6, the recipient shall waive any right to take any 
          legal action to prevent or defend against the collection by the 
          Administrator of any amount which the parties agree is past 
          due.
              (4) Cost of collection.--The costs incurred by the 
          Administrator in collecting any amount under this subsection 
          with respect to any loan shall be added to and treated as a 
          part of the principal amount of the loan.
              (5) Balance of loan principal and fees payable in 
          accordance with terms of loan.--A debtor who is subject to 
          collection proceedings under this subsection for any delinquent 
          portion of a loan under section 6 shall continue to meet the 
          repayment schedule applicable to such loan for the remaining 
          amount of principal and fees.
  
  SEC. 8. DISPOSITION OF FUNDS UPON REPAYMENT.
  
      The Administrator shall, at such times and in such amounts as the 
  Administrator determines to be appropriate, transfer amounts in the 
  loan repayment account referred to in section 4(e) hereof to the United 
  States Government general checking account referred to in section 
  4(d)(1).
  
  SEC. 9. DEFINITIONS.
  
      For purposes of this Act, the following definitions shall apply:
              (1) Administrator.--The term ``Administrator'' means the 
          Administrator appointed by the Secretary of the Treasury.
              (2) Board.--The term ``Board'' means the Board of Governors 
          of the Federal Reserve System.
              (3) Indian tribe.--The term ``Indian tribe'' means any 
          Indian tribe, band, pueblo, nation, or other organized group or 
          community, including any Alaska Native village or regional or 
          village corporation as defined in or established pursuant to 
          the Alaska Native Claims Settlement Act, which is recognized as 
          eligible for the special programs and services provided by the 
          United States to Indians because of their status as Indians.
              (4) Secretary.--Except when used in connection with a 
          reference to the Secretary of Commerce, the term ``Secretary'' 
          means the Secretary of the Treasury.
              (5) State.--The term ``State'' includes the District of 
          Columbia, the Commonwealth of Puerto Rico, Guam, American 
          Samoa, the United States Virgin Islands, and the Northern 
          Mariana Islands.
target: State and Local Government Economic Empowerment Act - Directs the Secretary of the Treasury to have money available for purposes of this Act (i.e., the creation of non-interest-bearing Government credit funds in measured or limited increments for the purpose of funding capital and environmental projects in the public interest) in an amount equal to the product of: (1) the U.S. population, as determined by the Secretary of Commerce on the basis of the 1990 census; and (2) $1,400. 
  Requires that the money be created by having the Secretary and the Board of Governors of the Federal Reserve System enter into a loan agreement whereby: (1) the Board shall lend the U.S. Treasury a sum up to $360 billion at the rate of not more than $72 billion per annum (on a cumulative basis) in each of the five years commencing 60 days after this Act's enactment date; and (2) the Secretary shall pay an annual fee to the Board to cover administrative costs that the Board incurs in acting as the agent of the Administrator appointed by the Secretary. 
  Treats any amount made available pursuant to this Act as money created in the sovereign and exclusive capacity of the United States to create money.  Specifies that: (1) money created under this section shall not be treated as revenue when it is created or made available to the Administrator, nor when the loans are repaid; (2) the money created and the interest-free loan program established under this Act shall not be treated as budget authority, shall not be subject to apportionment or sequestration other than in accordance with this Act, and shall not be taken into account in the determination of the baseline for any fiscal year; and (3) the disbursement of money created under this Act shall not be treated as an outlay or a budget outlay. 
  (Sec. 5) Entitles each State, county, township, incorporated municipality, school district, and Indian tribe to obtain a loan from the Administrator, unless such governmental unit is delinquent in repaying a prior loan, subject to specified limitations. 
  (Sec. 6) Directs the Administrator to issue an interest-free loan from the money created to any such government unit if the Administrator obtains assurances that the proceeds will be used solely for the purpose of: (1) funding capital projects of such unit, including the construction of or improvements to school facilities, streets, water and sewer systems, and public and environmental facilities; or (2) the cleanup of toxic waste sites or other environmental improvements.
feat_title: State and Local Government Economic Empowerment Act