,,ii #aagth ,,congress #ast ,session ,s4 #afhd ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,may #ah1 #bjba ,ms4 ,cortez ,masto 7for herself1 ,mr4 ,leahy1 and ,mr4 ,sanders7 introduced the following bill2 which was read twice and referred to the ,committee on ,finance ,a ,,bill ,to strengthen the ability of the ,federal ,home ,loan ,bank system to provide critical financing to address the economic crisis caused by the ,,covid-#ai pandemic and to meet the short- and long-term housing and community economic development needs of low-income communities1 including ,tribal communities1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,federal ,home ,loan ,banks' ,mission ,implementation ,act4 #b4 ,purpose ,the purpose of this ,act is to promote economic recovery in response to the ,,covid-#ai pandemic and to meet the short- and long-term housing and community economic development needs of low-income communities1 including ,tribal communities1 by-- 7#a7 increasing the ability of the ,federal ,home ,loan ,banks to accept1 as collateral1 small business loans guaranteed by the ,small ,business ,administration2 7#b7 authorizing the ,federal ,home ,loan ,banks to accept government guaranteed loans as collateral to support ,,covid-#ai programs2 7#c7 allowing community development financial institutions and credit unions to pledge community financial institution collateral1 such as small business1 small agriculture1 and community development loans1 and enable the ,federal ,housing ,finance ,agency to raise the threshold for qualification as a community financial institution2 7#d7 providing letters of credit to provide liquidity1 and support1 stabilize and strengthen local1 ,tribal1 ,state and ,federal governmental entities public unit deposits1 housing and community development efforts1 and vital public financing2 7#e7 increasing funding for the ,affordable ,housing ,program established by each ,federal ,home ,loan ,bank under section #aj7;j7 of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adcj7;j77 and establishing a #b percent set aside for ,native ,american ,tribes2 and 7#f7 creating a community economic development investment program within the ,federal ,home ,loan ,bank system to generate financial opportunity1 create jobs1 and stimulate economic development in distressed urban1 rural1 ,tribal1 and suburban communities in the ,united ,states4 #c4 ,,fhlb advances secured by ,,sba loans ,section #g of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcf7 is amended by adding at the end the following3 7o7 ,federal home loan bank advances 7#a7 ,definition of ,bank ,in this subsection1 the term ,bank means a ,federal ,home ,loan ,bank1 as defined in section #b of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adbb74 7#b7 ,advances ,a ,bank that1 in the exercise of its authority under section #aj of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adcj7 to make secured advances1 accepts as collateral a loan guaranteed by the ,administration under this ,act or any other provision of law1 including loans guaranteed under section #g7;a7-- 7,a7 may exercise all of the rights and remedies contained in any pledge or similar security agreement between the ,bank and the lending or participating institution that made or purchased the loan2 and 7,b7 in the event of default on the loan1 shall possess the same rights and remedies as such a lending or participating institution would possess in the same circumstance1 including collecting monies due on the guarantee directly from the ,administration4 7#c7 ,transfer of guarantee ,with respect to a guaranteed loan that a ,bank accepts as collateral under paragraph 7#b71 the guarantee obligation of the ,administration on the loan shall transfer to the ,bank4 4 #d4 ,making government guaranteed loans in response to the ,,covid-#ai crisis eligible collateral for the federal home loan banks ,section #aj7;a77#c7 of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adcj7;a77#c77 is amended by adding at the end the following3 7,f7 ,loans guaranteed or insured by the ,united ,states ,government or any agency thereof and made by any member under programs or facilities established by the ,secretary of the ,treasury or the ,board of ,governors of the ,federal ,reserve ,system under the ,,cares ,act 7,public ,law #aaf-acf7 or other similar programs or facilities in subsequently enacted ,acts to address the impact to the economy from the ,,covid-#ai crisis1 including other similar programs or facilities established under section #ac7c7 of the ,federal ,reserve ,act 7#ab ,u4,s4,c4 #cdc7c774 7,g7 ,loans guaranteed by the ,small ,business ,administration under the ,small ,business ,act 7#ae ,u4,s4,c4 #fca et seq47 or any other provision of law4 4 #e4 ,adding credit unions to the definition of community financial institutions and expanding the purposes of advances and collateral available to certain community development financial institutions 7a7 ,in general ,section #aj7;a7 of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adcj7;a77 is amended-- 7#a7 in paragraph 7#b77;,b71 by inserting or qualifying community development financial institution after community financial institution2 and 7#b7 in paragraph 7#c77;,e71 by inserting or qualifying community development financial institution after community financial institution4 7b7 ,definitions ,section #b of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adbb7 is amended-- 7#a7 in paragraph 7#aj7-- 7,a7 by striking institution4-- and all that follows through ,the term and inserting institution4--,the term2 7,b7 by striking subparagraph 7,b72 7,c7 by redesignating clauses 7i7 and 7ii7 as subparagraphs 7,a7 and 7,b71 respectively1 and adjusting the margins accordingly2 7,d7 in subparagraph 7,a71 as so redesignated1 by inserting 7#ab ,u4,s4,c4 #ahaa et seq47 or the ,federal ,credit ,union ,act 7#ab ,u4,s4,c4 #agea et seq47 before the semicolon2 and 7,e7 in subparagraph 7,b71 as so redesignated1 by striking #a1jjj1jjj1jjj and inserting assets at a level set by the ,agency1 but not more than #aj1jjj1jjj1jjj2 and 7#b7 by adding at the end the following3 7#ac7 ,qualifying community development financial institution ,the term qualifying community development financial institution means an entity that-- 7,a7 has been certified as a community development financial institution 7as such term is defined in section #ajc of the ,riegle ,community ,development and ,regulatory ,improvement ,act of #aiid 7#ab ,u4,s4,c4 #dgjb7 by the ,secretary of the ,treasury2 and 7,b7 satisfies the average total assets threshold requirement for a community financial institution set forth in paragraph 7#aj74 4 #f4 ,standby letters of credit ,the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adba et seq47 is amended-- 7#a7 in section #b 7#ab ,u4,s4,c4 #adbb71 as amended by section #e of this ,act1 is amended by adding at the end the following3 7#ad7 ,employee- or community-owned company ,the term employee- or community-owned company means-- 7,a7 an organization described in section #acha of the ,internal ,revenue ,code of #aihf2 7,b7 an eligible worker-owned cooperative1 as defined in section #ajdb7;c77#b7 of the ,internal ,revenue ,code of #aihf2 and 7,c7 an employee stock ownership plan1 as defined in section #dige7;e77#g7 of the ,internal ,revenue ,code of #aihf1 which meets the requirements of section #dji of such ,code4 2 7#b7 in section #aa 7#ab ,u4,s4,c4 #adca71 by adding at the end the following3 7m7 ,standby letters of credit 7#a7 ,in general ,each ,federal ,home ,loan ,bank is authorized to issue and confirm standby letters of credit1 secured by collateral eligible to secure advances1 to support any activity permitted under law or regulation applicable to the member or non-member mortgagee eligible to receive advances under section #aj;b1 subject to safety and soundness oversight1 including the purposes described in paragraph 7#b74 7#b7 ,purposes ,each ,bank is authorized to issue or confirm on behalf of members or non-member mortgagees standby letters of credit that comply with the requirements of this subsection for any of the following purposes3 7,a7 ,to assist members or non-member mortgagees in facilitating residential housing finance4 7,b7 ,to assist members or non-member mortgagees in facilitating community lending4 7,c7 ,to assist members or non-member mortgagees with asset or liability management4 7,d7 ,to provide members or non-member mortgagees with liquidity or other funding4 7,e7 ,to assist members in facilitating business retention or facilitating business transition to employee- or community-owned companies or assisting those companies4 4 #g4 ,letters of credit on tax exempt bonds 7a7 ,in general ,clause 7iv7 of section #adi7;b77#c77;,a7 of the ,internal ,revenue ,code of #aihf is amended by striking a bond during the period beginning on the date of the enactment of this clause and ending on ,december #ca1 #bjaj and inserting a municipal bond 7as defined in section #ge7;b77#a77 on or after the date of enactment of the ,federal ,home ,loan ,banks' ,mission ,implementation ,act4 7b7 ,safety and soundness requirements ,subparagraph 7,e7 of section #adi7;b77#c7 of the ,internal ,revenue ,code of #aihf is amended by striking which are at least and all that follows through the period and inserting as are established by the ,director of the ,federal ,housing ,finance ,agency from time to time44 7c7 ,effective date ,the amendments made by this section shall apply to guarantees made after the date of enactment of this ,act4 7d7 ,sunset ,effective on the date that is #b years after the date on which the ,federal ,emergency ,management ,agency terminates the emergency declared on ,march #ac1 #bjbj by the ,president under the ,robert ,t4 ,stafford ,disaster ,relief and ,emergency ,assistance ,act 7#db ,u4,s4,c4 #daba et seq47 relating to the ,coronavirus ,disease #bjai 7,,covid-#ai7 pandemic1 section #adi7;b77#c7 of the ,internal ,revenue ,code of #aihf is amended-- 7#a7 in subparagraph 7,a77iv71 by striking a municipal bond 7as defined in section #ge7;b77#a77 on or after the date of enactment of the ,federal ,home ,loan ,banks' ,mission ,implementation ,act and inserting a bond during the period beginning on the date of the enactment of this clause and ending on ,december #ca1 #bjaj2 and 7#b7 in subparagraph 7,e71 by striking as are established by the ,director of the ,federal ,housing ,finance ,agency from time to time and inserting which are at least as stringent as such requirements which apply under regulations applicable to such guarantees by ,federal home loan banks as in effect on ,april #i1 #bjjh4 #h4 ,affordable housing program 7a7 ,in general ,section #aj of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adcj7 is amended-- 7#a7 in subsection 7j7-- 7,a7 in paragraph 7#c7-- 7i7 in the matter preceding subparagraph 7,a71 by striking such as the following3 and inserting such as--2 7ii7 in subparagraph 7,a7-- 7,i7 by inserting the before purchase2 and 7,,ii7 by striking the comma at the end and inserting a semicolon2 7iii7 in subparagraph 7,b7-- 7,i7 by inserting the before purchase2 and 7,,ii7 by striking and at the end2 7iv7 in subparagraph 7,c7-- 7,i7 by inserting the before purchase2 and 7,,ii7 by striking the period at the end and inserting a semicolon2 and 7v7 by adding at the end the following3 7,d7 the purchase or rehabilitation of housing financed by a community land trust2 and 7,e7 the purchase or rehabilitation of housing in qualified manufactured home communities owned by nonprofit organizations or the residents4 2 and 7,b7 in paragraph 7#e77;,c7-- 7i7 by striking #aj and inserting #bj2 7ii7 by striking #ajj1jjj1jjj and inserting #bjj1jjj1jjj2 and 7iii7 by adding at the end the following3 ,of such contribution1 an amount equal to not less than #b percent of #bj percent of the preceding year's net income shall be used to support subsidized grants or advances through the ,affordable ,housing ,program benefitting federally recognized ,indian ,tribes and communities1 which includes awards outside of the district of a ,bank44 7b7 ,definitions ,section #b of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adbb71 as amended by section #f of this ,act1 is amended by adding at the end the following3 7#af7 ,manufactured home ,the term manufactured home has the meaning given the term in section #fjc of the ,national ,manufactured ,housing ,construction and ,safety ,standards ,act of #aigd 7#db ,u4,s4,c4 #edjb74 7#ag7 ,qualified manufactured home community 7,a7 ,in general ,the term qualified manufactured home community means-- 7i7 a cooperative controlled by residents or a nonprofit or municipal housing corporation established pursuant to the laws of the ,state in which the property used as a manufactured home community is located2 and 7ii7 7,i7 in the case of a community owned by a cooperative corporation or membership nonprofit1 with membership interests that are sold on a non-appreciating basis1 has only #a class of membership consisting solely of residents and homeowners that occupy a home in that manufactured home community2 or 7,,ii7 in the case of a community owned by a nonprofit corporation-- 7aa7 the nonprofit exists for the purposes of preserving and improving affordable housing and is primarily for residential purposes2 and 7bb7 the intent of the nonprofit in acquiring the community is for the purposes of preserving and improving the manufactured home community4 7,b7 ,governance ,an entity shall not be treated as a qualified manufactured home community unless governance of the entity is carried out by members elected to a board of directors with voting structured equitably among all members4 4 7c7 ,technical and conforming amendments ,section #aj of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adcj7 is amended-- 7#a7 in subsection 7c71 by striking ,federal home loan bank and inserting ,federal ,home ,loan ,bank2 7#b7 in subsection 7h77#b71 by striking section #aj7;a7 of this ,act and inserting subsection 7a72 and 7#c7 in subsection 7j7-- 7,a7 in paragraph 7#b71 in the matter preceding subparagraph 7,a71 by striking ,board's regulations and inserting regulations promulgated by the ,director2 7,b7 in paragraph 7#f7-- 7i7 in subparagraph 7,a71 by striking this paragraph and inserting paragraph 7#e72 7ii7 in subparagraph 7,c71 in the second sentence1 by striking ,board's decision and inserting decision of the ,director2 and 7iii7 in subparagraph 7,f71 by inserting ,notification4-- before ,the ,director2 7,c7 in paragraph 7#h71 in the matter preceding subparagraph 7,a71 by striking paragraph and inserting subsection2 7,d7 in paragraph 7#ab7-- 7i7 in subparagraph 7,a71 by inserting ,in general4-- before ,the ,director2 and 7ii7 in subparagraph 7,b71 by inserting ,analyses4-- before ,the analyses2 and 7,e7 in paragraph 7#ac71 in the matter preceding subparagraph 7,a71 by striking subsection-- and inserting subsection34 #i4 ,community investment cash advance and community economic development program 7a7 ,in general ,section #aj of the ,federal ,home ,loan ,bank ,act 7#ab ,u4,s4,c4 #adcj7 is amended by inserting after subsection 7e7 the following3 7f7 ,community investment cash advance and community economic development program 7#a7 ,in general ,pursuant to regulations promulgated by the ,director1 each ,bank-- 7,a7 may establish community investment cash advance programs to provide financing for members or nonmember mortgagees eligible to receive advances under section #aj;b to provide projects targeted to certain economic development activities and specific beneficiaries1 including certain geographic areas and at certain targeted income levels established by the ,bank with the prior approval of ,director2 and 7,b7 shall provide targeted community economic development grants and lending4 7#b7 ,mixed-use projects ,with respect to a project funded under a program established under this subsection involving a combination of housing projects and economic development projects1 only the economic development components of the project shall be required to meet the appropriate targeted income level for the program4 7#c7 ,pricing and availability of advances ,a ,bank shall price advances to members under this subsection as provided in section #abff4e of title #ab1 ,code of ,federal ,regulations1 or any successor regulation1 and may price such advances at rates below the price of advances of similar amounts1 maturities1 and terms made pursuant to subsection 7a74 7#d7 ,advances to non-member mortgagees eligible to receive advances 7,a7 ,in general ,a ,bank may offer advances under a program established under this subsection to non-member mortgagees eligible to receive advances under subsection 7b7 at the ,bank's option4 7,b7 ,pricing ,a ,bank shall price advances under this paragraph to non-member mortgagees eligible to receive advances under section #aj;b as provided in section #abff4ag of title #ab1 ,code of ,federal ,regulations1 or any successor regulation1 and may price such advances at rates below the price of advances of similar amounts1 maturities1 and terms made pursuant to section #aj;b4 7#e7 ,pricing pass-through ,a ,bank may require that borrowers receiving advances made under a program established under this subsection pass through the benefit of any price reduction from regular advance pricing to borrowers of the ,bank4 7#f7 ,discount fund 7,a7 ,in general ,a ,bank may establish a discount fund that the ,bank may use to reduce the price of advances made under a program established under this subsection below the advance prices provided for by part #abib of title #ab1 ,code of ,federal ,regulations1 or any successor regulation4 7,b7 ,fair distribution scheme ,price reductions made through a discount fund under subparagraph 7,a7 shall be made in accordance with a fair distribution scheme4 7#g7 ,community economic developing grants and lending 7,a7 ,definitions ,in this paragraph3 7i7 ,eligible entity ,the term eligible entity means-- 7,i7 a locally-owned nonprofit organization described in section #eja7;c77#c7 of the ,internal ,revenue ,code of #aihf and exempt from taxation under section #eja7;a7 of such ,code or a community development corporation-- 7aa7 that has experience in developing and managing economic development projects2 7bb7 that governed by a board of directors consisting of residents of the community and business and civic leaders2 and 7cc7 the principal purpose of which is to plan1 develop1 or manage low-income housing or community development projects2 7,,ii7 a non-depository community development financial institution1 as defined in section #ajc of the ,riegle ,community ,development and ,regulatory ,improvement ,act of #aiid 7#ab ,u4,s4,c4 #dgjb71 that is certified by the ,community ,development ,financial ,institutions ,fund under section #ahje4bja of title #ab1 ,code of ,federal ,regulations1 or any successor regulation2 7,,iii7 a federally recognized ,indian ,tribe or community2 or 7,,iv7 a regional or national nonprofit community development or cooperative development intermediary4 7ii7 ,low-income community ,the term low-income community has the meaning given the term in section #de;,d7e7 of the ,internal ,revenue ,code of #aihf4 7iii7 ,rural community ,the term rural community means a city1 town1 or ,census ,designated ,place with a population of not more than #bj1jjj1 according to the most recent decennial census conducted by the ,bureau of the ,census4 7iv7 ,very low-income household ,the term very low-income household means a household with an income that is not greater than #ej percent of the area median income4 7,b7 ,requirement ,each ,bank shall establish a program to provide grants or subsidize the interest rate on advances to members engaged in lending to eligible entities for economic development activities that serve low-income or rural communities4 7,c7 ,use of funds ,the entire amount of a grant or subsidized advance provided under this paragraph-- 7i7 shall benefit the communities assisted by the recipient of the grant or subsidized advance2 7ii7 shall not be used for the purpose of financial education or to support a sports stadium or arena2 and 7iii7 shall provide at least #b percent of grants or advance funds to benefit federally recognized ,indian ,tribes or communities1 which may include a ,bank providing grants or advance funds outside of the district of the ,bank4 7,d7 ,eligible activities ,economic development activities that are eligible to be carried out under this paragraph include-- 7i7 providing grants and equity investments1 including those that capitalize a revolving loan fund of a ,treasury-certified non-depository community development financial institution for eligible economic development activities similar to the authority provided within the ,affordable ,housing ,program under subsection 7j72 7ii7 providing awards consistent with awards provided under section #fhj of the ,community ,block ,grant ,act 7#db ,u4,s4,c4 #iiba72 7iii7 financing business transitions to worker-owned cooperatives or financing the sales of business assets to employees or community stakeholders that preserve jobs in low- and moderate-income communities2 7iv7 financing capital expenditures1 such as the purchase of equipment or real property for nonprofit organizations1 including child care or health care facilities in low-income communities1 that provide service to low-income households2 7v7 financing operating expenses for nonprofit community development organizations engaged in community economic development activities benefitting very low-income households2 7vi7 water1 road1 broadband1 clean energy1 or municipal infrastructure investments1 including investments to address climate change1 in ,native ,american tribal lands and economically distressed rural communities2 7vii7 providing community facilities or infrastructure1 including public transit1 green space consisting of parks with trees and shrubbery1 heat-reflecting road and sidewalk upgrades1 tornado shelters1 public restrooms1 or environmental cooling locations accessible to the public in low-income communities2 and 7viii7 any other activity established by the ,director in consultation with ,congress1 the ,federal ,home ,loan ,banks and their housing advisory councils1 and the public4 7,e7 ,priorities for making grants and advances ,in using amounts provided under this paragraph1 each ,bank member shall give priority to qualified projects such as-- 7i7 grants or advances for mixed-use housing developments that provide economic activity and affordable housing for low-income and rural communities2 7ii7 grants or advances for child care facilities that serve low-income households2 7iii7 grants or advances for programs that provide economic opportunities for formerly incarcerated individuals2 7iv7 grants or advances that enable conversion to employee- or community-owned companies or financing the sales of business assets to employees or community stakeholders2 7v7 grants or advances to established regional and national intermediary organizations that already receive ,federal funds and have the capacity to deliver economic development activities to low-income households2 and 7vi7 any other priority established by the ,agency in consultation with the ,banks1 ,bank members1 housing advisory councils of the ,banks1 ,congress1 and the public4 7,f7 ,requirements for projects in rural communities ,with respect to a project carried out by an eligible entity in a rural community under this paragraph-- 7i7 not less than #ea percent of the population served by the project shall reside in the rural community2 7ii7 the projects shall primarily serve and benefit rural residents and communities2 and 7iii7 the rural community shall be within the jurisdiction of the eligible entity4 7,g7 ,report ,each member receiving a grant or advance under this paragraph shall report annually to the ,bank making the grant or advance concerning the use by the member of the grant or advance4 7,h7 ,contribution to program ,each ,bank shall annually contribute #aj percent of the preceding year's net income1 or such prorated sums as may be required to ensure that the aggregate contribution of the ,banks shall not be less than #ajj1jjj1jjj for each such year1 to support grants and subsidized advances made under this paragraph4 4