H.R.7321 - Auto Industry Financing and Restructuring Act110th Congress (2007-2008)
Summary: H.R.7321 — 110th Congress (2007-2008)
Passed House amended (12/10/2008)
Auto Industry Financing and Restructuring Act - (Sec. 3) Directs the President to designate one or more executive branch officers (designee) to carry out the purposes of this Act. Requires such designee to have appropriate expertise to facilitate the restructuring necessary to achieve the long-term financial viability of domestic automobile manufacturers.
(Sec. 4) Requires the designee to authorize and direct the disbursement of bridge loans or to enter into commitments for lines of credit to each automobile manufacturer that submitted to Congress a plan on December 2, 2008, and request for such loan or commitment ("automaker," for purposes of this Act). Establishes as the amount of such assistance the amount intended to facilitate continued operations of the automaker and prevent its failure.
(Sec. 5) Directs the designee to: (1) determine measures to assess the progress of each automaker for transforming the plan submitted into a restructuring plan; (2) evaluate progress toward developing a restructuring plan after a 45-day period beginning when the assessment measures were established; and (3) facilitate agreement on a restructuring plan to achieve and sustain the long-term viability, international competitiveness, and energy efficiency of an automaker.
(Sec. 6) Requires each automaker to submit a restructuring plan to the designee no later than March 31, 2009. Directs the designee to approve such plan if it meets specified requirements, including that it will result in: (1) the repayment of all government-provided financing, under specified terms; (2) the domestic manufacturing of advanced technology vehicles, as described under the Energy Independence and Security Act of 2007; (3) efforts to rationalize costs, capitalization, and capacity; and (4) proposals to restructure existing debt.
(Sec. 7) Authorizes the designee, upon plan approval, to provide financial assistance to an automaker to implement the plan. Requires a loan to be called upon restructuring plan disapproval.
(Sec. 9) Directs the designee to prioritize the loan assistance to automakers, based on: (1) its necessity for continued operations; (2) potential impacts of the automaker's failure on the U.S. economy; and (3) the ability to use the assistance to satisfy operational and long-term restructuring requirements.
(Sec. 10) Makes appropriations to provide loan funds under this Act in an amount up to $14 billion. Authorizes appropriations to the Secretary of Energy to replenish funds made available. Provides loan terms and conditions.
(Sec. 11) Requires each recipient, during the loan period, to inform the designee of: (1) any proposed automaker transaction in excess of $100 million; and (2) any other material change in financial condition. Authorizes the designee to review and approve or disapprove such a transaction. Outlines provisions concerning an automaker's failure to comply with loan requirements.
(Sec. 12) Requires the designee to receive warrants for up to 20% of the common or preferred stock of each automaker as a loan condition. Subjects each automaker, during the loan period, to specified executive compensation and corporate governance standards. Limits an automaker's owning or leasing of corporate passenger aircraft, and prohibits an automaker's payment of dividends, during such period. Subordinates to the federal loan any other automaker obligations.
Prohibits a title 11 bankruptcy discharge from discharging an automaker or its successor in interest from any debt for assistance received under this Act.
(Sec. 13) Directs the Comptroller General (CG) to conduct ongoing oversight of the designee's activities and performance and to report at least every 60 days to Congress. Adds to duties of the Special Inspector General established by the Emergency Economic Stabilization Act of 2008 the duty to coordinate audits and investigations of the designee.
(Sec. 14) Requires: (1) each loan recipient to analyze potential uses of excess production capacity to make vehicles for sale to public transit agencies; and (2) the CG to review such analyses and report thereon to Congress and the designee.
(Sec. 15) Requires reports from the designee to Congress on: (1) bridge loans made under this Act; (2) the restructuring progress assessment measures established under section 5; (3) actions taken against an automaker for failure to comply with this Act's requirements; (4) any additional powers and authorities necessary to facilitate completion of a negotiated restructuring plan; (5) progress of automakers to continue operations and proceed with restructuring processes that restore financial viability and promote environmental sustainability; and (6) a plan on achieving the long-term viability, international competitiveness, and energy efficiency of each automaker.
(Sec. 18) Directs the designee to serve as a guarantor of leases of qualified transportation property (domestic property subject to a lease approved by the Federal Transit Administration prior to January 1, 2006). Requires designee recoupment of payments of claims in excess of collateral held with respect to such guarantees.
(Sec. 19) Authorizes a salary adjustment during FY2009 for justices and judges of the United States.
Sets forth guidelines for application of the antitrust laws and antitrust agency participation in proceedings of the automakers.
(Sec. 20) Makes inapplicable to ownership changes resulting from this Act certain Internal Revenue Code provisions limiting the carryover of net operating losses and certain built-in losses.
(Sec. 21) Designates amounts provided under this Act as an emergency requirement under the FY2008 concurrent budget resolution.
(Sec. XX [sic]) Amends the Federal Deposit Insurance Act to require each financial condition report from insured depository institutions that received an investment or other assistance under the Troubled Asset Relief Program (TARP) established by the Emergency Economic Stabilization Act of 2008 or under the Energy Independence and Security Act of 2007 to contain information on any increase in new lending during the report period that is attributable to such investment or assistance. Allows an alternative report on the total amount of increased new lending if the institution cannot accurately quantify the effect that an investment or other assistance under TARP has had on any new lending.