Reforming the Regulation of Government-Sponsored Enterprises in the 110th Congress

^Pr^ep^ar^{ed f}^o^r^M^e^m^b^ers^an^d^Com^mⁱ^t^t^ees^of^C^ong^r^e^ss

As government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac are hybrids: created
and chartered by Congress for specific public policy purposes, they are nonetheless private,
profit-seeking businesses whose shares are traded on the New York Stock Exchange. Their
“government-sponsored” nature confers certain advantages over their purely private competitors.
As a result, their operations have expanded rapidly over the years and they long ago assumed—
and continue to play—critical roles in the residential mortgage market. In mid-2008, troubles in
the mortgage market threatened the viability of the two GSEs; Congress responded by authorizing
the Treasury to provide emergency funding to either firm.
In 1992, Congress established the Office of Federal Housing Enterprise Oversight (OFHEO), an
agency within the Department of Housing and Urban Development (HUD), to oversee the
financial safety and soundness of the two firms. OFHEO is authorized to set capital requirements,
conduct annual risk-based examinations, and generally enforce compliance with safety and
soundness standards.
With the rapid subsequent growth of the GSEs, and major accounting scandals at both Fannie
Mae and Freddie Mac, the effectiveness of current regulation has been widely questioned. Several ^th^th
legislative proposals considered in the 108 and 109 Congresses addressed GSE regulatory
reform, but none was enacted. However, the adequacy of GSE regulation remained a prominent
legislative issue.
Although improving supervision of Fannie Mae and Freddie Mac is the major focus, regulatory
reform also involves the 12 Federal Home Loan Banks, which comprise one collective GSE. The
Federal Home Loan Banks lend to lenders—their member banks—primarily for housing, but also
for many other purposes. They will now be brought under a single regulatory umbrella with
Fannie and Freddie.
The Housing and Economic Recovery Act of 2008 (H.R. 3221, P.L. 110-289), enacted on July 30,
2008, replaces OFHEO with an independent agency to oversee the GSEs, with enhanced safety
and soundness, disclosure, and enforcement tools. The new law raises the conforming loan limit
(which sets a ceiling on the size of mortgages that the GSEs can buy) in high cost areas to 150%
of the national limit. P.L. 110-289 also establishes a fund, to be financed by Fannie and Freddie,
to support low-income housing programs. Finally, the law authorizes the Treasury to buy GSE
securities—debt or equity—in any amount, if necessary to provide stability to financial markets,
prevent disruptions in the availability of mortgage credit, or protect the taxpayer. This emergency
rescue authority expires on December 31, 2009.
This report provides background on the GSE reform issue and summarizes the provisions of
House- and Senate-passed versions of H.R. 3221. It will no longer be updated.

Introduc tion ..................................................................................................................................... 1
The Need for Reform......................................................................................................................3
Recent Developments......................................................................................................................3
The Reform Legislation...................................................................................................................4
An Independent Regulator with Enhanced Authority...............................................................5
Affordable Housing Fund..........................................................................................................5
Portfolio Limits.........................................................................................................................6
Conforming Loan Limits...........................................................................................................7
Table 1. Fannie Mae and Freddie Mac: Selected Combined Financial Statistics, 1992 and
2006 .............................................................................................................................................. 2
Table 2. Provisions of House- and Senate-Approved Versions of H.R. 3221 in the 110^th
Congress ....................................................................................................................... ................ 9
Author Contact Information..........................................................................................................32
Acknowledgments ......................................................................................................................... 32

Fannie Mae and Freddie Mac are hybrids: created and chartered by Congress for specific public
policy purposes, they are nonetheless private, profit-seeking businesses whose shares are traded
on the New York Stock Exchange. Their “government-sponsored” nature confers certain ¹
advantages over their purely private competitors. As a result, their operations have expanded
rapidly over the years and they long ago assumed—and continue to play—critical roles in the
residential mortgage market.
In exchange for government sponsorship, their statutory charters restrict Fannie and Freddie to
buying, holding, guaranteeing, packaging, and selling mortgages that other firms originate and
require them to meet a set of housing goals, whose general thrust is to promote and support home
ownership among low- and moderate-income families, even where such activities may not be
profit-maximi zi ng.
Congress has long been concerned that the safety and soundness of the government-sponsored
enterprises (GSEs) be maintained in order that they meet their public policy mission and not pose
risks to the housing finance system or to taxpayers. Prior to 1992, oversight was the responsibility
of the Department of Housing and Urban Development (HUD) and the Federal Home Loan Bank
Board. In 1992, in recognition of the two GSEs’ growing importance to the mortgage market,
Congress established the Office of Federal Housing Enterprise Oversight (OFHEO), an
independent agency within HUD, whose exclusive mission is to oversee the financial safety and
soundness of the two firms. OFHEO is authorized to set capital requirements, conduct annual
risk-based examinations, and generally enforce compliance with safety and soundness standards.
Since Congress created OFHEO in 1992, Fannie Mae and Freddie Mac’s business has continued
to expand. Table 1 illustrates the expansion by comparing certain figures for 1992 and 2006. The
principal business activity of the two firms is mortgage securitization. They buy mortgage loans
from the original lenders, pool them, and repackage them as mortgage-backed bonds, which may
be sold to investors or held in the GSEs’ own investment portfolios. The two firms purchased
$442.7 billion in mortgage loans in 1992, and more than double that amount in 2006. As a
percentage of all mortgages originated, however, the GSEs’ share fell, an indication that other ²
financial institutions are active in the mortgage market.

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Table 1. Fannie Mae and Freddie Mac: Selected Combined Financial Statistics,
1992 and 2006
^{(all fi}^{gures except percentages}^{in billions of do}^llars)
^{% Growth,}
¹⁹⁹²²⁰⁰⁶¹⁹⁹^2-20⁰⁶
^Mortgages^Purc^hased^442.^{7 909.}^{3 105.}⁴
^Purchase^{s as Perce}^{nt of All Mort}^{gages Originated}^49.5^30.5
^{Mortgage-Backed Securities Issue}^d^373.²^841.⁷^125.⁵
^{Percent of all MBS Issue}^s^35.8^41.0
^{Mortgage-Backed Securities Outs}^tanding^832.⁰^2,90^0.3^248.⁶
^{Percent of all MBS Outsta}^nding^63.4^50.6
^{Retained Mortgage Portfolio}^189.⁹^1,42^6.4^651.¹
^{Financial Derivatives (Notional A}^{mount O}^utstanding)^71.7^1,54^3.4^2,05^2.6
^Sources:^OFH^EO^Re^{port to Cong}^ress^{, 20}^{06, and}^{Inside Mortgage Fi}^{nance P}^ublications,^{2006 Mortgag}^{e Market Statistical}
^Annual^.
^Note:^“Reta^{ined Mortgage Portfoli}^{o” includes whole mortgage lo}^{ans and mortgage-related sec}^{urities. Derivatives}
^{total is for 199}^{3; earlier figures a}^{re not available for Freddie Mac.}
In terms of issues of new mortgage-backed securities (MBS), the figures in Table 1 tell a similar
story. The value of MBS issued by Fannie and Freddie in 2006 was more than double the 1992
figure, but their share of all MBS issued increased much more slowly. The value of all Fannie and
Freddie MBS outstanding more than tripled over the period, but the percentage of MBS
outstanding accounted for by the two firms remained relatively unchanged. Again, this suggests
rapid growth in all segments of the mortgage securitization market, including those where the
GSEs are not the major players.
The figures in Table 1 relating to purchase and securitization of mortgages, and the value of MBS
outstanding indicate that the GSEs have grown rapidly, but also suggest that most of that growth
can be attributed to the general expansion of the home mortgage market. The fact that large
increases in the volume of business occur without correspondingly large increases in market share
is evidence that there are other major players in the marketplace, although these institutions
generally do not compete head-to-head with Fannie and Freddie in the same market segments.
The last two lines in Table 1, however, show a change in the nature of the GSEs’ business, rather
than a simple increase in scale.
The 651% increase in the GSEs’ mortgage portfolios suggests that the GSEs’ business model has
changed significantly. They appear to be less focused on serving as a conduit between mortgage
lenders and bond investors, and instead are placing more emphasis on earning interest income by
holding mortgage loans and MBS in their own investment portfolios. Fannie and Freddie’s low
cost of capital, derived from their GSE status, allows them to finance the purchase of mortgage
assets by selling debt at interest rates below the yield on the acquired mortgages. The difference,
or spread, between the rates is profit. As profit-seeking firms, the GSEs have an incentive to
maximize the size of their portfolios. Table 1 illustrates the magnitude of their response to this
incentive.
Holders of mortgage loans and mortgage-backed bonds face a range of financial risks. Like any
fixed-rate debt asset, a mortgage loses value if market interest rates rise. In addition, mortgage

investors are at risk when interest rates fall, because home owners have the right to prepay or
refinance their loans, and high interest mortgages—most desirable from the investor’s point of
view—are the first to be prepaid. To manage these risks, Fannie and Freddie turn to the
derivatives markets, where contracts may be purchased that provide insurance against (or hedge
the risks of) unfavorable changes in interest rates. Table 1 shows that as their portfolios have
grown, the GSEs’ use of derivatives to manage risk has exploded. Financial management at
Fannie and Freddie has become a more complex job, and safety and soundness regulation has
become more challenging.

Growth in business volume and the risks posed by growing portfolios (and the derivatives
transactions needed to manage those risks) would likely have made GSE regulatory reform a ^th^th³
priority in the 110 Congress (as it was in the 109) even if that growth had been managed
smoothly. But it was not: serious problems with financial accounting came to light at Freddie Mac ⁴
in 2003, then at Fannie Mae in 2004. Both GSEs had to restate their earnings for several years,
pay fines totaling hundreds of millions of dollars, and replace their top managers.
The accounting scandals revealed serious weaknesses in accounting policies and controls. In
essence, both firms ignored generally-accepted accounting principles (GAAP) and chose their
accounting policies to produce the financial results that management wanted. Particularly
disturbing, beyond the basic willingness to manipulate financial results, was that many of the
lapses involved accounting for financial derivatives contracts, upon which the GSEs depend to
manage the financial risks they face.

In July 2008, the price of Fannie Mae’s and Freddie Mac’s shares plunged by more than 60%,
leading to new and more acute concerns about the future of the companies. The immediate fear
was that credit market participants would refuse to lend money to Fannie or Freddie. Since the
GSEs’ portfolios are financed by hundreds of billions of dollars in short-term debt, which must be
constantly refinanced or rolled over, neither firm could survive long without access to the credit
markets. This is what happened to the investment bank Bear Stearns in March 2008: essentially a
“non-bank run.” James B. Lockhart, the director of OFHEO, issued statements reaffirming that
the two companies were adequately capitalized. Although this was true in a regulatory sense, in
economic terms, both firms were extremely vulnerable to a loss of market confidence. Treasury
Secretary Henry M. Paulson Jr. asked Congress to pass legislation that would give the Treasury ⁵
broad authority to lend money to or invest in stock of Fannie Mae and Freddie Mac. Congress

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responded swiftly: Section 1117 of the Housing and Economic Recovery Act of 2008 (H.R. 3221,
P.L. 110-289), enacted on July 30, 2008, authorizes the Treasury to purchase any amount of
Fannie or Freddie securities—debt or equity—if necessary to provide stability to financial
markets, prevent disruptions in the availability of mortgage credit, or protect the taxpayer. The
implicit guarantee has become nearly explicit.

H.R. 3221, as amended and approved by the House, includes provisions from H.R. 1427, which
was introduced by Chairman Frank and passed by the House on May 22, 2007. The bill took a
comprehensive approach to the reform of GSE regulation. The major changes between the House
version of H.R. 3221 and H.R. 1427 are (1) that H.R. 3221 would make permanent the higher
conforming loan limits in high-cost housing areas enacted by the Economic Stimulus Act of 2008, ⁶
and H.R. 3221 explicitly states that the GSEs may not obtain bankruptcy protection. The Senate
version of H.R. 3221 is generally similar to the House version—each would create a new agency
with enhanced regulatory authority.
Key differences between the House and Senate versions are as follows.
• The House version would make the new regulator a member of the Federal
Financial Institutions Examination Council (FFIEC) along with the Fed, Federal
Deposit Insurance Corporation (FDIC), National Credit Union Administration
(NCUA), Office of the Comptroller of the Currency (OCC), and Office of Thrift
Supervision (OTS). The Senate bill would not make the new regulator a member
of FFIEC.
• The House version increases the conforming loan limit in high cost areas to
175% of the national median house price while the Senate version would increase
the limit in high cost areas to 150%.
• The House version would create the new regulator six months after enactment;
the Senate version would create the new regulator immediately upon enactment.
Other key differences in non-GSE portions of H.R. 3221 include the following.
• The House version continues to permit seller-assisted downpayments on loans
guaranteed by the Federal Housing Administration (FHA) and to allow FHA to
implement risk-based pricing; the Senate version would eliminate seller ⁷
assistance and would not authorize risk-based pricing.

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• The Senate version would authorize $3.9 billion in Community Development
Block Grants (CDBG) to encourage local governments to buy and rehabilitate ⁸
foreclosed homes; the House bill does not have this provision. The
Administration has said it might veto a bill with this provision.
• The House version included some $11 billion in housing-related tax reductions;
these tax reductions are fully offset in the bill. The Senate version has $14.5 ⁹
billion in tax reductions; $12.1 billion of the reductions is offset in the bill.
Both versions of H.R. 3221 propose a restructuring of GSE regulation. They would replace
OFHEO with an independent agency, called the Federal Housing Finance Agency, which would
have enhanced safety and soundness powers, similar to those of federal banking regulators. Given
the importance of the GSEs to the financial system, and the potential risks they pose, there is little
support for keeping the GSE regulator inside HUD. Among the new powers would be the
authority to set capital standards by order or regulation, to establish standards for the GSE
portfolios, and to initiate receivership or liquidation proceedings for a failing GSE.
Also included under the new agency’s regulatory umbrella would be the Federal Home Loan
Banks (FHLBs), which comprise one collective GSE, but have not experienced the kinds of
problems and business shifts seen at Fannie and Freddie in recent years. (The bills refer to all
GSEs—the FHLBs and Fannie and Freddie—as “regulated entities.” In provisions that apply only
to Fannie and Freddie, the term “enterprises” is used.)
Section 340 of the House version of H.R. 3221 would require Fannie and Freddie to contribute to
an affordable housing fund to support home ownership among very low- and extremely low-
income families, to increase investment in housing in low-income and economically distressed
areas, and to increase and preserve the supply of rental and owner-occupied housing for very low-
and extremely low-income families. Each enterprise would be required to contribute to the fund
to the fund 1.2 basis points (0.012%) annually of its average total mortgage portfolio during the
preceding year. Proponents of the affordable housing funds recognize that Fannie and Freddie
receive a valuable subsidy in the form of their GSE status, which permits them to borrow at lower
rates than other private financial firms. The affordable housing fund proposal can be viewed as a
means of redirecting some of the value of this subsidy from private shareholders and corporate
management to a policy objective consistent with the GSEs’ charters.
H.R. 1461 (109^th Congress) included a similar provision, which proved to be among the most ¹⁰
controversial sections of the bill. Opponents argued that Fannie and Freddie would use the funds
to reward political allies or for indirect lobbying purposes. During floor consideration of H.R.
1461, an amendment was adopted that prohibited the use of money disbursed by the affordable

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housing funds for political, lobbying, or advocacy purposes. Other amendments included a five-
year sunset for the fund (with the director of the new regulator to recommend to Congress
whether the fund should be extended) and established a priority for activities in areas affected by
Hurricanes Katrina and Rita, and in other areas designated by the President as major disaster
areas.
These amendments are incorporated into H.R. 3221 (with some modifications). Other changes
include the allocation formula (in H.R. 1461, the enterprises were to contribute 5% of their profits
to the fund) and the distribution mechanism—under H.R. 3221, the money would be paid to the
new agency, which would pass it on to the states, who would select the ultimate recipients. Under
H.R. 1461, Fannie and Freddie would have controlled the funds themselves, and dealt with
recipients directly.
The Senate version also provides for such a fund, although the amount of funds to be contributed
and the allocation of funding are structured differently. The contributions would be divided
between affordable housing (65%) and a new community development Capital Magnet Fund
(35%). Initially, however, contributions would be used to provide a contingency fund for the FHA
mortgage relief program created elsewhere in the bill. After this is phased out 25% would
continue to go to a fund to hep to pay off bonds sold to finance the mortgage relief program.
The Senate version would require Fannie and Freddie to contribute 4.2 basis points (0.042%) of
the unpaid principal of mortgages purchased during a year. The House version would require
Fannie Mae and Freddie Mac to contribute 1.2 basis points (0.012%) of the annual average total
of mortgages retained in portfolio or sold in the secondary market, whether or not the mortgages
are pooled into an MBS, to the new GSE affordable housing fund. Based on 2007, the House
version would have raised $592 million and the Senate version would have raised $501 million
for the affordable housing funds. These provisions are in marked contrast to the Senate bill in the ^th

109 Congress, which did not provide for the creation of a fund.

As noted above, both Fannie and Freddie hold large portfolios of mortgages and mortgage-backed
securities, leading some observers to describe them as the world’s largest savings and loan
institutions. The size of their portfolios represents a concentration of mortgage market risk that
led former Federal Reserve Board Chairman Alan Greenspan and others to urge Congress to ¹¹
consider ways to shrink the size of the GSEs’ asset portfolios. Supporters of portfolio limits
argue that reducing the size of the portfolios would prevent financial trouble at either Fannie or
Freddie from spilling over into the financial system at large.
In the 109^th Congress, Section 109 of S. 190 (which was marked up by the Banking Committee
but never brought to the floor) included statutory provisions that would have limited Fannie and
Freddie’s ability to hold mortgage assets in portfolio. The GSEs would have been allowed to
acquire mortgages and mortgage-backed securities only for purposes of securitization (with
certain limited exceptions). Under this proposal, Fannie and Freddie’s business models would
have been considerably altered: instead of very large investment funds, they would be
transformed into conduits, buying mortgages from the original lenders, pooling them, packaging

¹¹^Se^e^,^e^.^g^{., te}^s^tim^ony^of^A^l^aⁿ^G^r^e^e^ns^pa^n,^C^h^aⁱ^r^m^aⁿ^{, B}^o^a^r^d^of^G^ove^r^nor^s^of^the^Fe^de^r^a^{l R}^e^s^e^r^v^e^S^y^s^t^em^{, bef}^o^r^e^the
^H^ous^e^C^o^m^m^itte^e^{on Fi}^na^nc^ia^{l S}^e^r^v^ic^e^s^{, Fe}^br^ua^r^y^17,²⁰^05.

them into mortgage-backed securities, and selling them to bond investors. This change would
have greatly reduced their portfolio earnings, currently one of the chief sources of their profits.
Proponents of portfolio limits have argued that such a step is needed to reduce the cost of the
GSE subsidy to taxpayers, which takes the form not of annual appropriations, but of the
assumption of risk, that is, the potential cost to the Treasury of having to bail out either Fannie or
Freddie. Opponents argue that reducing the GSEs’ interest earnings would mean less support for
low- and moderate-income housing goals.
House legislation in the 109^th Congress did not contain portfolio limits. This was one of the key
disagreements between House and Senate that prevented enactment of GSE reform.
Section 325 of the House version of H.R. 3221 represents a compromise position. The director of
the new agency would be specifically directed to monitor portfolios, and would have the authority
to direct an enterprise to acquire or dispose of any asset, without requiring a formal determination
that such an action was consistent with the safe and sound operation of the enterprise. During
committee and floor consideration of H.R. 1427, two amendments were adopted that appear to
constrain the regulator’s authority to impose portfolio limits based on systemic risk concerns. In
the amended version, the regulator is directed to establish portfolio standards by taking into
consideration risks to the safety and soundness of Fannie and Freddie themselves, but not risks to
the financial system that might arise from the GSEs’ activities.
The Senate version of the bill takes a similar approach. The director of the new agency is
authorized to monitor the enterprises’ portfolios, and to ensure that the holdings are backed by
sufficient capital and consistent with the mission and the safe and sound operations of the ^th
enterprises. Thus, the sharp differences between House and Senate approaches in the 109
Congress appear to have been bridged.
Current law sets a limit on the size of mortgages that Fannie and Freddie can buy. Mortgages
above the limit, called jumbo loans, are less likely to be securitized than the conforming
mortgages that Fannie and Freddie are allowed to purchase. Partly as a result, mortgage rates for
nonconforming loans are slightly higher than conforming loan rates. Critics of the conforming
loan limit argue that the limit has a disparate geographical effect: in some areas of the country the
limit, which was $417,000 for single-family homes in 2007, covers all but the high end of the
market, while in other areas, such as San Francisco or New York City, virtually all real estate
transactions take place over the limit.
H.R. 1427, the GSE reform bill passed by the House on May 22, 2007, would have raised the
limit permanently by up to 50% in high-cost housing areas, allowing the GSEs to expand into
markets now served by non-GSE institutions. In response to turmoil in the mortgage market,
however, the Economic Stimulus Act of 2008 (P.L. 110-185) enacted a temporary increase in the
conforming loan limit. For mortgages originated between July 1, 2007, and December 31, 2008,
the limit is capped at 175% of the statutory limit, or $729,750, in certain high-cost areas.
Section 333 of H.R. 3221 (House) would make the temporary measure in the Stimulus Act
permanent. It would raise the conforming loan limit in metropolitan areas where the median home
price exceeds the current limit. In those areas, the limit would be set at the median home price, up

to a ceiling of 175% of the national limit ($729,750). For more information on this proposal, see
CRS Report RS22172, The Conforming Loan Limit, by N. Eric Weiss and Mark Jickling.
The Senate-passed version also calls for a permanent increase in the conforming loan limits, but
only to 150% of the current ceiling of $417,000 ($625,500).
Table 2 below provides brief summaries of the provisions of the House and Senate approved
versions of H.R. 3221. Where there are significant differences between H.R. 3221 and H.R. 1427,
which passed the House in 2007, the provisions are set out in italics. Titles IV and VI and
Divisions B and C of the Senate bill, which do not deal with GSE reform, are not covered.

Table 2. Provisions of House- and Senate-Approved Versions of H.R. 3221 in the 110^th Congress
^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^Title^{Title III—Reform of Reg}^{ulation o}^f^Enterp^{rises and Federa}^{l Home}^{Title I—Reform of Reg}^{ulation of}^Enterprises
^{Loan Banks}
^Subtitl^e^Subtitl^{e A—Reform}^{of Reg}^{ulation of}^{Enterprises and Fed}^eral^Subtitl^{e A—Improvement of}^{Safety and Sound}^ness
^{Home Loan Banks}^Supervision
^Chapter^{Chapter 1—improvement of}^{Safety and Soundness}
^{Short Title}^{Federal Housing Finance Reform}^{Act of 20}⁰⁸^{Federal Housing Finance Regulat}^{ory Reform Act of 2}⁰⁰⁸
^{Federal Housing Fina}^{nce Reform Act of 2007}
^Definitions^{“Regulated Entity” refe}^{rs to Fan}ⁿ^{ie Mae and Freddie Mac a}^{nd affiliates, and}^{Same definition of “regulated entity.”}
^{each Federal Home Loan Ba}^nk.^{Definition of “entity-affiliated party” is identical to}^H.R^{. 322}^1‘s
^{“Regulated Entity-affiliated Party” means-(A) any director, officer,}^employee,^{definition of “regulated entity-affiliated party.”}
^{or agent for, a reg}^{ulated entity, or controlling shareholder of an}^e^nterp^rise;^{Also includes definitions of danger of default, very low income,}
^{(B) any share}^{holder, affiliate, c}^{onsultant, or joint ventur}^{e part}^ner^{of a}^{conforming mortgage, ext}^remely^{low income, and low income area.}
ⁱ^{ki/CRS-RL33940}^{regulated entity, and an}^{y other}^p^{erson, as determined}^{by the}^{Director (by}^{(Sec. 1128)}

^g/w^{regulation or on a case-b}^{y-case b}^{asis) that participates in}^the^{conduct of the}^{affairs of a reg}^{ulated entity, exce}^{pt that a}^shar^{eholder of a reg}^{ulated entity}
^s^.or^{shall not be considered to hav}^{e p}^{articipated in the af}^{fairs of that}^re^gulated
^le^ak^{entity solely by reason of}^{being a}^{member or}^customer^{of the}^regu^lated
^://wiki^{entity; (C) any indepe}^{ndent cont}^r^{actor for a reg}^{ulated entity (inclu}^{ding any}^{attorney, app}^{raiser, or accounta}ⁿ^{t), if—(i}^{) the independe}^{nt contra}^ctor
^h^ttp^{knowingly or recklessly participat}^{es in—(I) any violation of any law or}
^{regulation; (II) any}^breac^{h of fiduc}^{iary duty; or (III) a}^{ny u}^{nsafe or}^uⁿ^sound
^{practice; and (ii) such}^violati^{on, breach, or p}^{ractice caus}^{ed, or is li}^{kely to}
^{cause, more tha}^{n a minimal fina}ⁿ^{cial loss to}^{, or a significant adverse effect}
^{on, the regulated e}^{ntity; and (D) any not-for-profit cor}^{poration th}^{at receive}^s
^{its principal fu}^{nding, on an ongoin}^{g basis, from any}^{regulated entity.}^(Sec.
³⁰²⁾
^“^{Regulated Entity}^{” refe}^{rs to Fannie Mae and Freddie Mac an}^{d affil}^{iates, and each}
^{Federal Home Loan Bank.}
^{“Regulated Entity-Af}^{filiated Pa}^{rty” m}^{eans (1) directors, officers, e}^mploye^{es, or}
^{agents of a regulated entity, or a controlling shareholder; (2) shareholde}^rs,
^{affiliates, consultants or joint ventur}^{e partners, or any other person as d}^etermined
^{by the director, that participates in t}^{he conduct of the affairs of the regu}^lated
^{entity (except that shareholders are not participants solely because they}^are
^members^{or custom}^{ers of the regulated entity); (3) any independent contractor}
^{that knowingly or rec}^{klessly participates in violation of law, breach of fid}^uciary

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{duty, or unsafe or unsound practice that may cause more than minimal}^{loss t}^o^the
^{regulated entity; and (4) an}^{y not-for profit that receives its principal fun}^{ding from a}
^{regulated entity. (Sec. 302)}
^{New Regulatory Agenc}^y^{Federal Housing Finance Age}^ncy^{(Sec. 311)}^{Federal Housing Finance Age}^ncy^{(Sec. 1101)}
^{Agency Status}^Indepe^{ndent fede}^{ral agency. (Sec. 30}¹⁾^{Identical provisions. (Sec. 1101)}
^Jurisdiction^{General s}^upe^{rvisory and reg}^{ulatory aut}^{hority over Fannie}^{Mae, Fre}^{ddie Mac,}^{General s}^upe^{rvisory and reg}^{ulatory aut}^{hority over Fannie}^{Mae, Fre}^ddie
^an^{d the Federal Home Loa}^{n Bank}^{s. (Sec. 311)}^{Mac, the Federal Home Loan}^Ban^{ks, and the Finan}^{ce Facility. (Sec}^.
¹¹⁰¹⁾
^{Agency Of}^ficials^{A Director, appointed by t}^{he Pre}^{sident, with advice and consent o}^f^the^Simi^{lar, except that}^{the t}^{hird dep}^{uty director’s title will be “Deputy}
^{Senate for a five-year te}^{rm. Should the office be}^{vacant, a}^{new Dir}^{ector shall}^{Director for Housing Mission a}ⁿ^d^{Goals.” (Sec. 1105)}
^{be ap}^{pointed to fill only the rema}^{inder of the te}^rm.
^{Three Dep}^{uty Directors, ap}^{pointed by the}^{Director for the}^Divisi^{ons of}
^Enter^{prise Regulation, Federal Home Loan Bank Regulation, and}^Housing.
^{An Office of t}^{he O}^m^b^{udsman to}^{consider complaints and a}^{ppeals f}^{rom any}
ⁱ^{ki/CRS-RL33940}^{regulated entity and a}^ny^person^{with a bu}^{siness r}^{elationship with}^any^{regulated entity. (Sec. 311)}
^g/w
^s^.or^{Qualifications of Officials}^{The Director and Dep}^{uties must}^{be U.S. citizens, who have a demonstrated}^{Identical provisions. (Sec. 1101)}
^le^ak^understa^{nding of fina}^{ncial manage}^{ment, with spe}^{cialized knowledge}^and^experie^{nce re}^{quired for de}^puty^{Directors relevant to the of}^fices^{they head.}
^://wiki^{(Sec. 301)}
^h^ttp^{Duties and Aut}^{horities of}^{the Director}^{Principal duties are to oversee t}^h^e^{operations of each}^{regulated e}ⁿ^{tity and}^{to ensure}^{that eac}^{h e}^{ntity: (1) operates in a sa}^{fe and sou}^{nd man}^ne^{r, and}^Simi^{lar provisions, with the additi}^{onal duties to ensure}^{that t}^he^{activities of regulated entities are consistent with t}^he^pu^{blic intere}^st,
^{maintains adequate}^{capital and int}^{ernal controls; (2) fosters liquid, efficient,}^{that the}^{entities remain ade}^quatel^{y capitalized.}
^{competitive, and resilient national housing finan}^{ce market}^{s that}^{minimize the}^{Does not require}^{consultation with the Attor}^ney^Gene^{ral in}
^{cost of housing fina}^{nce (including}^{for housing}^{for low- and moderate-income}^{conservator or re}^ceivership^proc^{eedings. (Sec. 1102)}

^{families); (3) complies with applicable rules, guidelines, orders and}
^{regulations pu}^rsua^{nt to ap}^{plicable law; (4) carries out its statutor}^y^mission
^{only through}^{activities consistent}^{with applicable law.}
^{The Director may review a}^{nd rej}^{ect acq}^{uisition or transfer of a}^controlling
^{interest in a}^{regulated entity; may}^{exercise a}^{ny n}^ecessary^{or ap}^pro^priate
^{incidental powers to fulfill agency}^{’s duties of supe}^{rvision and reg}^{ulation; may}
^{enforce actions it takes, or admin}^{ister conservators}^{hip or re}^ceiver^ship
^through^litigati^{on either indepe}^{ndently (in consultation with t}^{he At}^torney
^{General) or th}^rough^{the Attor}^ne^{y Gene}^{ral. (Sec. 312)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Prudential Manageme}^{nt a}ⁿ^d^{The Director shall establish sta}^{ndards for each}^{regulated e}^{ntity for}⁽¹⁾^Simi^{lar provisions, except does n}^{ot include specific refe}^rence^to
^{Operations Standards}^{internal controls and infor}^{mation systems, (2) inter}^{nal audit syste}^{ms, (3)}^{subordinated debt. (Sec. 11}⁰⁷⁾
^{credit and counte}^rpart^{y risk, (4) interest}^{rate risk ma}^nageme^{nt, (5)}
^{monitoring and manageme}^{nt of}^{market risk, (6) adeq}^{uacy and}^ma^intenance
^{of liquidity and reserves, (7) asset}^{and portfolio management, (8)}
^{investments a}^{nd ac}^{quisitions, (9) record keeping, (1}^{0) issuanc}^{e of}
^{subordinated debt, as t}^{he Direct}^{or considers neces}^{sary, (11) over}^{all risk}
^{management, including}^rep^{utational risk and mainte}^nance^{of remo}^{te facilities}
^{to protect against disru}^{ption, and (12) other}^{standards t}^{he Direct}^{or finds}
^approp^{riate. (Sec. 312)}
^{Failure to Meet Prudential}^{If the Director}^{finds that a}^regula^{ted entity has}^{failed to meet any}^prude^ntial^{Identical provisions. (Sec. 1108)}
^Standards^{standard, the e}^{ntity must}^su^{bmit a plan within}^{30 days}^{to correct t}^he
^{deficiency, and the Director may}^{prohibit any i}^{ncrease in}^{total assets of the}
^{entity, require a}ⁿ^inc^{rease in}^reg^{ulatory capital, or take other acti}^{ons until}
^{the deficiency is corre}^{cted. The}^{Director shall take one or more}^{of these}
^{actions if the entity}^{fails to meet prescri}^{bed standards, if the}^{deficiency is no}^t
^{corrected, and if the e}^{ntity u}^nder^{went ext}^{raordinary growth}^{in th}^{e 18}
ⁱ^{ki/CRS-RL33940}^months^{prior to the date w}^{hen it}^{first failed to meet the sta}^{ndard. (Sec. 312)}
^g/w^{Federal Housing En}^terp^rise^{Creates the Federal Ho}^{using E}ⁿ^t^{erprise Board to advise the Direc}^{tor on}^Simi^{lar, except that}^{the Board is}^{called the Federal Housing Financ}^e
^s^.or^Board^{overall strategies and policies. Th}^{e Board is to have three}^membe^r^{s: the}^{Oversight Board and it is to have}^{four mem}^bers^{(the c}^{hairman of t}^he
^le^ak^{Secretaries of the Treas}^ury^and^{Housing and Ur}^ban^Development^{and the}^{Securities and E}^xcha^{nge Commission (SEC) is added)}^{. (Sec. 1103)}
^{Director, who chairs the Board. The Board meets at least once ev}^{ery thr}^ee
^://wiki^{months a}^{nd shall testify an}^nually^{before Congres}^{s on t}^{he safety}^an^d
^h^ttp^soundness^{of the}^{regulated entities, any material deficiencies in th}^{e conduct}^{of the entities’ operations, the ov}^{erall operational status of the e}ⁿ^t^{ities, an}
^{evaluation of how the e}^{ntities are}^{carrying out}^{their missions, the}
^{operations, resources a}^{nd pe}^rfor^{mance of t}^{he Agenc}^{y, and other}^matters
^{the Board deems ap}^{propriate. (Sec. 312)}
^{Annual Report}^{of the}^{The ann}^{ual report}^{of the Directo}^{r is expa}^{nded to include an as}^ses^{sment of}^Simi^{lar provisions. (Sec. 1103)}
^Director^{the Board or any of its me}^mber^s^{with respe}^{ct to (1) safety a}^{nd so}^undnes^{s o}^f
^{the reg}^{ulated entities; (2) material deficiencies in conduct of the}^operations
^{or the entities; (3) overall operational status of the}^{regulated e}^{ntities; and}
^{(4) evaluation of the}^performa^nc^{e of the e}^{ntities in carrying o}^{ut t}^heir
^{missions; (5) operations, resourc}^{es, and perfor}^{mance of t}^{he Age}ⁿ^{cy; and (6)}
^{other matters}^{relating to the Age}^{ncy and its f}^{ulfillment of its mission. (Sec.}
³¹³⁾
^{Authority to Require}^{Adds reports on “ma}^nageme^{nt, activities, or operations as the Director}^Simi^{lar authority to req}^{uire reg}^{ular financial re}^{ports. Establishes}
^{Reports by Reg}^ulated^{considers app}^{ropriate” to reg}^{ular reports t}^{he Director may}^req^uir^e.^{penalties for reg}^{ulated entities’ failure to report or th}^{e re}^{porting of}
^Entities^{(Sec. 314)}^{false or misleading information. (}^{Sec. 110}⁴⁾

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Duty to Report Fraud}^ulent^{Requires a r}^{egulated entity to re}^{port in a timely man}^{ner t}^{he discovery (or}^Simi^{lar provisions. (Sec. 1113)}
^Transactions^{suspicion of) any}^fraud^{ulent loan}^{or financial instrum}^{ent t}^{he e}^{ntity may have}
^purc^{hased or sold. The Director is to require t}^{he entities to establ}^{ish and}
^{maintain procedu}^{res to discover}^{such t}^ransa^{ctions. (Sec. 304)}
^{Charitable Contributions}^{The Director shall req}^{uire each}^e^nterp^{rise to su}^{bmit an a}ⁿⁿ^{ual rep}^{ort on}^{No comparable}^provision.
^{the total value of contrib}^{utions t}^o^{non-profit organizations; including the}
^{name of th}^{e organization and value of contrib}^{utions (for cont}^ribut^ions
^{exceeding an a}^{mount dete}^rmined^{by th}^{e Director); and for cont}^rib^utions
^{above the designated amo}^{unt to}^{any non}^{profit of whic}^{h a director}^{, officer,}
^{or controlling person of the}^ente^{rprise, or a spo}^{use, was a director or}
^{trustee, the}^{name of}^the^nonp^{rofit and value of t}^{he contrib}^{ution. Such}
^{information is to be p}^{ublicly avail}^{able. (Sec. 305)}
^Assessment^s^{The Director shall establish and c}^{ollect annual assessme}^{nts f}^{rom th}^e^Assessment^{s collected from the}^enterp^{rises shall not e}^{xceed the}
^{regulated entities to provide for}^{reasonable costs a}^{nd ex}^pense^{s of}^the^{amounts s}^{ufficient to}^{provide for the costs and e}^x^p^enses^describedⁱⁿ
^{Agency, including (1) costs of e}^x^a^{minations, reviews, and credit ass}^essments,^subsec^{tion relating to the e}^nterp^{rises. Assessments}^{collected from the}
^{and (2) amount}^{s in ex}^{cess of act}^u^{al expens}^{es to maintain}^necessar^{y working}^{Federal Home Loan Banks s}^{hall n}^{ot exceed the amo}^unts^suf^ficient^to
ⁱ^{ki/CRS-RL33940}^{capital. Assessments may}^{be in}^cr^{eased to cover costs of en}^forcem^ent^{activities or if an entity is inadequ}^{ately capitalized}^{. Salaries and other}^{provide for the costs a}^{nd ex}^pen^s^{es of regulating t}^{he Federal Hom}^e^{Loan Banks. (Sec. 11}⁰⁶⁾
^g/w^expe^{nses s}^{hall be paid from as}^ses^{sments, whic}^{h shall not be}^constr^{ued to be}
^s^.or^government^fu^{nds or ap}^prop^{riated monies. The Agency s}^{hall provide OMB}
^le^ak^{with financial plans a}^{nd forecasts,}^pre^{pare a}ⁿⁿ^{ual financial stateme}^nts
^{(including an assertion of t}^{he eff}^e^{ctiveness of inter}^{nal accou}^{nting c}^ontrols),
^://wiki^{and be a}^{udited annually b}^y^the^G^overnment^Accounta^{bility Office}^{(GAO) at}
^h^ttp^{the Agenc}^{y’s ex}^{pense. (Sec. 31}⁶⁾
^Examine^{rs and}^{The Director may hire e}^xamine^rs^{, accountants, s}^{pecialists in techn}^{ology or}^Simi^{lar provisions. (Sec. 1105)}
^Accountant^s—Special^{financial markets, and economists}^{in accordance with}^{rules gover}^{ning the}
^{Hiring Authority}^{excepted s}^{ervice, notwithstandin}^{g any r}^{ules governing}^{the com}^pet^itive
^{service. (Sec. 317)}
^Inspe^{ctor Ge}^neral^{No provision. Reference to I}^nspe^{ctor Gene}^{ral of Departme}^{nt of}^Housing^{There shall be wit}^{hin the}^Agency^{an In}^spector^Gene^{ral. (Sec, 1105)}
^{and Urba}^{n Development. (Sec. 3}¹⁷⁾
^Exec^{utive Compen}^sation^{The prohibition (in cu}^rre^{nt law) of executive com}^{pensation t}^{hat is}^not^{Identical provisions. (Sec. 1113)}
^{reasonable or compa}^{rable is ame}^{nded by}^{permitting the}^Director^{to take}
^{into account wrongdoing on t}^he^{part of t}^{he exe}^{cutive, and to hold pay in}
^{escrow while a determination is}^{made. (Sec. 318)}
^{Ratings Agencies}^{Director may contract with}^othe^{r than}^{nationally recognized statistical}^{No similar provision.}
^{ratings agencies}^{for to conduct}^r^{eviews of regulated entities. (Sec.}³¹⁹⁾
^{Regulations and Orders}^{The Director is authorized to issue any}^{regulations, guidelines, or orders}^Simi^{lar provisions (Sec. 1107)}

^{that are}^necessa^{ry to carr}^{y out t}^{he aut}^{horizing statutes. (Sec. 32}¹⁾

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Inclusion of Women a}^nd^Each^{regulated entity s}^{hall create}^{or designate an Of}^{fice of Minorit}^{y and}^{No comparable}^provision.
^{Minorities; Diversity}^{Women Inclusion, to ens}^{ure t}^he^{inclusion and utilization of minori}^{ties and}
^{women in all levels of business a}^c^{tivities, t}^o^{the maximum}^exte^{nt p}^ossible.
^{(Sec. 320)}
^{Risk-Based Capital}^{The Director shall, by regulation, establish risk-based ca}^{pital req}^uirements^Simi^{lar, but no s}^{pecific mention o}^f^{confidentiality. (Sec. 1110)}
^Requirement^s^{for the e}^nter^{prises to ens}^ure^safe^{and sound ope}^{ration and mainte}^{nance of}
^{sufficient ca}^{pital and reser}^{ves to}^sup^{port risk e}^xposu^{re. The Direc}^{tor shall}
^{establish risk-based ca}^{pital requir}^{ements for t}^{he FH}^{LBs. Confidentiality of}
^{information enabling risk-bas}^{ed c}^{apital standards shall be maintain}^ed.
^{(Sec. 323)}
^{Minimum Capital}^{The Director may by}^{regulation e}^{stablish minimum ca}^{pital levels for}^{The Director may by}^regulation^{or order establish minimu}^{m capit}^al
^Requirement^s^{regulated entities that a}^{re highe}^r^{than t}^{he stat}^{utory levels. The Director}^{levels for regulated entities that a}^{re higher}^tha^{n the}^{statutory level}^s.
^{may, by order, increase}^minimum^{capital levels on a temporary}^bas^{is if the}^{(Sec. 1111)}

^{regulated entity ha}^{s violated prud}^{ential standards or if an}^unsa^{fe or}^unsou^nd
^{condition exists. The Director may, by order or reg}^{ulation, establish}
^additi^{onal capital or reserve re}^qu^{irements with}^respe^{ct to any}^part^icular
ⁱ^{ki/CRS-RL33940}^{program or activity.}
^g/w^{The Director shall, by regulation, set critical capital levels for the Federal}
^s^.or^{Home Loan Banks.}
^le^ak^{The Director shall periodically review the amou}^{nt of core ca}^{pital held by}
^{the ente}^rp^{rises, and shall rescind}^{any tem}^{porary minim}^{um capital level}
^://wiki^{increase if the}^{conditions that wa}^{rranted t}^{he increa}^{se no longer e}^xist.
^h^ttp^{(Sec. 324)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Review of, and Authority}^{The Director shall, by regulation, establish standards}^{by w}^{hich t}^he^portfolio^{The Director shall, by regulation, establish criteria gover}^{ning the}
^{Over, En}^terp^{rise Assets}^{holdings, or rate of growth of the}^{portfolio hold}^{ings, of the enter}^p^{rises will}^{portfolio hold}^{ings of the ente}^rpri^{ses, to ensure}^{that t}^he^{holdings are}
^{and Liabilities (P}^ortfoli^o^{be consistent}^{with the}^{mission an}^{d safe and sou}^{nd operations. In}^developing^{backed by}^suf^{ficient capital and c}^{onsistent with t}^{he mission and t}^h^e^safe
^Limits)^{standards, the Director s}^{hall consider (1) the size or growth of t}^h^e^{and sound ope}^{rations of the e}^nte^{rprises. In}^{establishing s}^u^c^h^criter^ia,
^{mortgage market; (2) t}^{he need}^{for the}^{portfolio in maintaining liquidity or}^{the Director shall consider the}^a^{bility of the enter}^{prises to p}^{rovide a}
^{stability of the secondary mortga}^{ge market; (3) t}^{he need}^{for an in}^{ventory of}^{liquid secondary market t}^hroug^h^{securitization activities, the portfoli}^o
^{mortgages in conne}^{ction with sec}^{uritizations; (4) the need for t}^he^portfolio^{holdings in relation to the overall mortgage market.}
^{to directly support t}^{he afforda}^{ble housing mission of th}^{e ente}^rpris^{es; (5) the}^{The Director may tem}^{porarily adjust these}^{regulations if nece}^ssary^to
^{liquidity needs of the ente}^rp^{rises; (6) any}^{potential risks posed to t}^he^{mitigate market disruptions in t}^h^e^{housing fina}^{nce s}^{ystem. (Sec. 1}¹⁰⁹⁾
^enterp^{rises by}^the^natu^{re of th}^e^{portfolio hold}^{ings; and (7) any ad}^ditional
^{factors that t}^{he Director determi}^{nes to be}^necessa^{ry to car}^{ry out}^the
^pur^{pose u}^{nder t}^{he first se}^nte^nce^{of this su}^{bsection to establish sta}^ndards
^{for assessing w}^hethe^{r the}^{portfolio holdings are consistent with t}^h^e^mission
^{and safe a}^{nd sound ope}^{rations of the en}^terp^{rises. The Director m}^{ay, by}
^{order, make temporary}^adjustme^{nts to the}^{standards du}^{ring mark}^{et stress}
^{or disruption. Standards shall be i}^{ssued within}¹⁸^{0 days of t}^{he effe}^{ctive date}
^{of this legislati}^{on. (Sec. 325)}
ⁱ^{ki/CRS-RL33940}^{Authority to Require}^{The Director shall monitor the p}^ortfolio^{of each ente}^{rprise. Pur}^su^{ant to}^Simi^{lar provisions. (Sec. 1109)}
^g/w^Dispositi^{on or Acquisition}^subsec^{tion (a) and notwithstandi}^{ng the}^{capital classifications of the}
^s^.or^{of Assets}^enterp^{rises, the Director may,}^by^{order, require a}ⁿ^e^nterp^{rise, un}^{der suc}^h^{terms and co}^{nditions as the Dire}^{ctor determines to be}^ap^propriat^{e, to}
^le^ak^{dispose of or acquire a}^{ny asset. (}^{Sec. 325)}
^://wiki^{Corporate Gover}^{nance of}^{Requires a majority of the}^board^{to be independe}^{nt directors, as d}^{efined by}^Simi^{lar provision.}
^h^ttp^Enter^prises^{the NYSE. Req}^{uires boards to m}^{eet at least eight times a yea}^{r, an}^{d requires}^non-manageme^{nt directors to m}^{eet regularly in e}^{xecutive s}^ession^without
^management^{participation. Boards shall include audit, compensation, and}
^{nominating committees, to be co}^{mposed and em}^{powered according to SEC}
^{and NYSE r}^{ules. (Sec. 326)}
^{Compensation by}^{Compensation of Directors, exec}^{utives, and employees s}^{hall not exceed}^Simi^{lar provisions. (Sec. 1113)}
^Enter^prises^{what is reasona}^{ble and ap}^prop^{riate, shall be commens}^{urate with}^{duties and}
^{responsibilities, consistent with t}^{he long-term goals of the e}^nter^pr^{ise, and}
^{shall not focus solely on earning}^s^performa^{nce. E}^nter^{prises are}^ma^{de subject}
^{to Section 304 of t}^{he Sarba}^nes-O^{xley Act, which}^req^{uires CEO}^{s a}^{nd CFOs}
^{to reimburse}^{the com}^pany^u^nder^{certain circ}^umstan^{ces afte}^{r an ac}^counting
^restatement^{involving misconduct}^{. (Sec. 318)}
^{Golden Parachute}^s^{No provision}^{Under certain}^circumsta^{nces, th}^e^{Director is authorized to prohib}^it
^{indemnification or golden parach}^{ute pay}^{ments to e}^{ntity-affiliated}
^{parties. (Sec. 111}⁴⁾

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Code of Conduct and}^{An ente}^{rprise s}^{hall establish and}^{enforce a w}^{ritten code of conduc}^{t designed}^{No provision.}
^Ethics^{to ensure}^{that Directors, officers}^{, and employees act in a}ⁿ^imparti^{al and}
^{objective manner, including sta}^nd^{ards under}^{Section 40}^{6 of t}^{he Sar}^banes-
^{Oxley Act. The code shall be}^{reviewed at least once every}^thr^{ee y}^{ears. (Sec.}
³²⁶⁾
^{Responsibilities of the}^{The board of an e}^nter^{prise s}^{hall oversee (1) corporate}^{strategy, ri}^{sk policy,}^{No provision.}
^{Board of Directors}^{and compliance p}^{rograms, (2) hiri}^{ng and ret}^{ention of q}^{ualified exec}^utives,
^{(3) compensation}^{programs, (4) t}^{he integrity of accou}^{nting a}^{nd fin}^ancial
^{reporting syst}^{ems, (5) disclosures}^{to shareholders a}^{nd investors, (6)}
^{extensions of c}^{redit to officers a}^{nd directors, and (7) res}^ponsiven^{ess in}
^{reporting to federal reg}^{ulators. (Sec. 326)}
^{Prohibition of Extensions}^{An ente}^{rprise ma}^{y not (directly, indirectly, or through a}^su^{bsidiary) make}^{No provision.}
^{of Credit}^{any pe}^{rsonal loan to a board me}^{mber or e}^xec^{utive officer. (Sec. 326)}
^{Certification of Discl}^osures^{The CEO a}^{nd CFO of an}^enter^pr^{ise shall review ann}^{ual and q}^uarte^rly^{No provision.}
^{reports a}^{nd shall make the}^certifi^{cations required}^{by Section 3}⁰²^{of the}
^Sarbanes-O^{xley Act. (Sec. 326)}
ⁱ^{ki/CRS-RL33940}^{Change of A}^{udit Partner}^{Requires t}^{hat the lead pa}^rtne^{r of}^{the exte}^{rnal auditor of an}^enter^p^{rise be}^{No provision.}
^g/w^{changed eve}^{ry five yea}^{rs. (Sec. 32}⁶⁾
^s^.or
^le^ak^{Compliance Program}^{Each e}^nter^{prise s}^{hall establish a c}^{ompliance program}^{reasonably d}^{esigned to}^{No provision.}
^ensu^{re that t}^{he e}^nter^{prise complies with ap}^{plicable laws, regulatio}^{ns, and}
^://wiki^{internal controls. The progra}^{m s}^{hall be headed by}^{a compliance of}^{ficer, who}^{reports directly to the C}^{EO a}^nd^{regularly to the}^{board. (Sec. 326)}
^h^ttp
^{Risk Management}^Program^{Each e}^nter^{prise s}^{hall establish a r}^{isk management}^program^reason^ably^{No provision.}
^{designed to manage the}^{risks of operation. The progra}^{m shall be}^h^{eaded by}
^{a risk manageme}^{nt officer, who}^r^{eports directly to the CE}^{O and}^r^{egularly to}
^{the board. (Sec. 326)}
^{SEC Registration}^{Requires eac}^{h reg}^{ulated entity to register at least one class of}^capi^{tal stock}^{Provides that equity se}^curities^iss^{ued by t}^{he e}^nter^{prises are}^{not ex}^empt
^Requirement^s^{with the SEC, and}^req^{uires ente}^r^{prises (Fannie}^{Mae and Freddie M}^{ac) to}^{from SEC registration re}^quireme^{nts, and re}^{quires e}^nter^{prises (Fan}^nie
^{comply with Sections 14}^and¹⁶^{of the Securities E}^x^c^{hange Act}^{of 19}³⁴^{Mae and Freddie Mac) to comply}^{with Sections 12, 1}^{3, 1}⁴^and^{16 o}^f^the
^{(which deal with prox}^{y re}^porting^{and disclosure of insider tran}^sac^{tions in}^{Securities Exc}^hange^{Act of 1}⁹³⁴^.^{(Sec. 1112)}
^{company stock). (Sec. 32}⁷⁾
^Enter^{prises w}^{hose stock is not r}^{egistered or deregistered remain}^{subject to}
^{certain p}^{rovisions of the Securiti}^{es Ex}^cha^{nge Act. (Sec. 326)}
^{Federal Financial}^{The FHFA shall be a m}^embe^{r of t}^{he FFIEC. (Sec. 32}⁸⁾^{No provision.}

^{Institutions E}^xamination
^{Council (FFIEC)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^Guara^{ntee Fee Study}^{The GAO, in cons}^{ultation with t}^{he heads of t}^{he fede}^{ral banking}^a^gencies^{The Director shall conduct a}ⁿ^on^{-going study of fees c}^{harged to}
^{and the OF}^{HEO, s}^{hall, not later than one}^{year afte}^{r th}^{e date of th}^e^guarantee^{mortgages a}^{nd ann}^{ually report to Congre}^{ss on}^pricing,
^{enactment, s}^u^b^{mit to Congress a}^{study of th}^{e pricing, tra}^nspa^renc^{y and}^reven^{ues, costs, average fee}^cha^r^{ged, and any cha}^{nge in}^{fees. (Sec.}
^{reporting of t}^{he reg}^{ulated entities with regard to gua}^rantee^{fees a}^nd¹⁵⁰¹⁾
^{analogous practices, tran}^spare^ncy^{and reporting}^req^uireme^{nts of o}^ther
^{participants in}^the^busi^{ness of mo}^{rtgage p}^urcha^{ses and}^secu^ritizati^{on. The}
^{study shall examine}^{various facto}^{rs suc}^{h as c}^{redit risk, counter}^par^{ty risk,}
^{and economic value considerations. (Sec. 329)}
^{Chapter 2—Improvement of}^{Mission Supervision}^Subtitl^{e B—Improvement of Mission Supervision}
^{Transfer of Produ}^ct^{This section transf}^{ers HUD’s aut}^{hority for new}^{product a}^p^p^{roval and}^{Identical provision. (Sec. 1121)}
^{Approval and Ho}^{using Goa}^l^{housing goals to the FHFA. (Sec. 331)}
^Oversight
^{New Product Ap}^proval^{The enter}^{prises m}^{ust obtain}^ap^pr^{oval from the Director before}^off^{ering any}^Simi^{lar provision. (Sec. 1123)}
^{new “p}^{roducts,” which a}^{re define}^{d. This section transfers}^{HUD’s authority}
^{for new}^{product a}^{pproval and}^{housing goals to the FHFA. (Sec. 33}²⁾
ⁱ^{ki/CRS-RL33940}^{Standard for App}^roval^{The Director shall determine tha}^{t a new}^{product is consiste}^{nt with the}^enterp^{rise’s charte}^{r, is in the}^pu^b^{lic interest, is consistent with the}^safety^{Identical, except t}^{hat the}^there^{is no standard conc}^erning^“materia^lly^{impair the ef}^{ficiency...” as in H.R.}³²²^{1. (Sec. 11}²³⁾
^g/w^{and soundne}^{ss of th}^{e ente}^rprise^{or the mortgage fina}^{nce s}^ystem,^{and does}
^s^.or^{not materially impair the efficienc}^{y of the mortgage}^finance^system.
^le^ak^{(Sec. 332)}
^://wiki^{Procedure for Ap}^proval^{The enter}^{prises mak}^{e a written}^r^{equest to t}^{he Director, who shall}^pu^blish^{the re}^quest^{in the}^{Federal Register}^{with a 3}^{0-day pu}^{blic comment}^p^{eriod. The}^Simi^{lar, but Director may give te}^{mporary a}^{pproval without}^pu^blic^{comment u}^{nder e}^{xigent circ}^umst^{ances. (Sec. 112}³⁾
^h^ttp^{Director will have 30 days afte}^{r t}^{he close of the comme}^nt^{period to}
^{approve or de}^{ny t}^{he re}^{quest. (Se}^{c. 332)}
^{Definition of Product or}^{The term “}^{product” does not inc}^{lude the ente}^rp^{rises’ automated loan}^{No specific refe}^renc^{e to “significant new}^ex^{posure to risk}^{for the}
^{New Busines}^{s Activity}^{underwriting s}^{ystems in}^existenc^{e on the date of e}^nactme^{nt of thi}^s^enterp^{rise or the}^{holder of the m}^{ortgage.” (Sec. 1123)}
^legislat^{ion, or any modificati}^{ons or upg}^{rades to suc}^{h sy}^{stems t}^hat^{do not (1)}
^{include services or fina}^{ncing othe}^{r than}^{residential mortgage finan}^c^{ing, or (2)}
^{create significant}^{new ex}^posu^{re t}^o^{risk for the e}^nter^{prise or the}^h^{older of}
^{the mortgage. (Sec. 332)}
^{Conforming Loan Limit—}^{The conforming loan limit will inc}^{rease or decrease}^{to reflect the}^a^nnual^{Limit cannot decline. Decreases a}^{re “ba}^{nked” and u}^{sed against late}^r
^Indexation^{change in}^{a housi}^{ng price inde}^x^{maintained by t}^{he Director. (Sec.}³³³⁾^{increases. (Sec. 112}⁴⁾

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^Increase^{in Conforming}^{In areas}^wher^{e 1}²⁵^%^{of the}^{median house}^{price e}^{xceeds t}^he^{national limit,}^{Limit is increased to lesser of 1}⁰^{0% of area}^{median or 1}³²^%^{of na}^tional
^{Loan Limit for High-Cost}^{the area limit is 12}^{5% of t}^{he area}^{median, but}^{not more tha}^{n 1}⁷⁵^%^{of the}^{loan limit ($550,440). (Sec. 11}²⁴⁾
^Areas^{national limit}^{. Areas shall be the}^s^{ame as used to deter}^{mine the}^FH^A
^guarantee^{limits. (Sec}^{. 333)}
^{H.R. 1427: The conformi}^{ng loan lim}^{it shall be increased in areas where}^the
^{median price exceeds the general li}^{mitation to the les}^{ser of (1) 150% o}^f^such
^{general limitation or (2) the median price in the area. The Director may}^{limit such}
^{an increase to mortgages which are securitized and sold by the enterpris}^e.
^{(Sec. 133)}
^{House Price I}^ndex^{The Director shall maintain an in}^{dex of national average single fa}^m^{ily house}^Simi^{lar provisions relating to index; no GAO}^{audit. (Sec. 1124)}
^{prices for}^{use for adjusting}^{the c}^{onforming loan limitations of the}
^enterp^{rises. GAO s}^{hall audit this}^{index within 1}⁸⁰^{days of the}^crea^{tion of}
^{the index a}^{nd after}^{any modification to the index. (Sec. 33}³⁾
^{Conditions on Conforming}^{H.R. 3221}^{: No provision.}^{Loans above t}^{he national confor}^{ming loan limit may not be held in a}
^{Loan Limit Increa}^{ses for}^{GSE’s portfolio, but must}^{be sec}^u^ritized.^{(Sec. 1124)}
^{High-Cost Areas}^{H.R. 1427}^:^Th^e^Direct^{or s}^{hall co}^{nduct a}^stud^{y to}^de^ter^m^ine⁽¹⁾^t^h^{e effect}^s
ⁱ^{ki/CRS-RL33940}^{of res}^t^ricting^the^higher^confor^mi^{ng loan limit}^{s only}^to^mo^rt^gag^e^s^securitiz^e^{d and}^{sold b}^y^th^{e en}^ter^p^rises^{on th}^{e av}^{ailability of mort}^gag^e^{s for}
^g/w^housing^{in high-co}^s^{t ar}^ea^{s and}^{, (}²^{) th}^e^ex^ten^t^to^{which th}^e^ent^e^r^p^rises^will
^s^.or^{be able}^to^{sell s}^e^curitie^s^ba^sed^oⁿ^mor^t^ga^g^e^{s for h}^o^usin^{g loca}^ted^{in such}
^le^ak^high-cos^{t are}^a^s^.^{If th}^{e Dir}^e^ctor^d^e^ter^m^ine^s^{that c}^o^s^t^s^{to b}^o^rrow^e^r^s^{in such}
^://wiki^high-cos^{t are}^a^{s will be incr}^eas^e^d^{by such}^re^striction^s^,^th^{e Dir}^e^ct^o^r^may^issue^{an ord}^e^{r t}^e^r^m^inating^such^rest^rictions^.^(Se^c^{. 133)}
^h^ttp^{Contents of An}^{nual Report}^{The report}^{shall (1) discuss t}^{he e}^{xtent to w}^{hich t}^{he reg}^{ulated entity is}^{Director shall report an}^{nually to Congress on}^{GSE ac}^hievements^of
^{to Congress}^{meeting (or could better me}^{et) its statutory}^pu^{rposes, including h}^ousing^{housing goals, aggregate data on}^{housing goals, incomes, race, gen}^der,
^{goals, community investment, an}^{d affordable housing}^{programs; (}²⁾^analyze^sub^{prime mortgage}^pur^{chases, a}ⁿ^d^{nontraditional loans.}
^{data on income, race, and gender}^{, and discuss violations of fair lending}^{The Director shall conduct a mo}^{nthly s}^{urvey of}^charact^{eristics of}
^procedures^{by lende}^{rs; (3) exa}^{mine credit conditions in the m}^ultifamily^{conforming and}^{non-conforming}^{mortgages, house p}^{rices, unde}^rw^riting
^{housing mortgage ma}^{rkets a}^{nd th}^{e status of e}^{fforts to p}^{rovide stan}^dard^{characteristics, etc. Such}^{data sha}^{ll be made pu}^{blic in a timely man}^ner.
^{credit terms and}^underw^{riting gui}^{delines for multifamily housing an}^d^{(Sec. 1125)}

^{securitize suc}^{h mortgage p}^roduct^{s; (4) examine t}^he^{use of alternati}^{ve credit}
^{scoring and other}^means^{to expa}^{nd opportu}^{nities for first-time ho}^me
^buye^{rs; (5) analyze e}^{xisting trend}^{s in pricing a}^{nd other co}^{nditions i}ⁿ^the
^{housing mark}^{ets and mortgage}^m^{arkets; and (6) identify t}^{he e}^xtent^{to which}
^{each ent}^erp^{rise is involved in the}^sub^{prime mortgage}^{market, and}^compare
^{the cha}^{racteristics of s}^u^b^{prime loans p}^urc^{hased and se}^{curitized by}^the
^enterp^{rises to other loans}^pu^rch^{ased and secu}^{ritized by the e}^nter^prises.
^{(Sec. 334)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Standards for Sub}^prime^{Within one year of t}^{he eff}^ective^{date of this legislati}^{on the Direct}^{or shall}^{No comparable}^provision.
^Loans^{issue standards}^{by w}^{hich mortgag}^{es pu}^rchas^{ed shall be considered}^sub^prime
^{for the}^pur^{pose of complying wit}^{h the}^reporting^req^uirement^{in H}^ousing
^{and Community Developme}^{nt A}^{ct of 19}^{92. (Sec. 33}⁴⁾
^{Mortgagor Identification}^{Prohibits regulated entity involve}^{ment with mortgage}^{s whe}^{re the}^borrower^{No comparable}^provision.
^Requirement^s^{does not have a Social Security account}^num^{ber. (Sec. 33}⁶⁾
^{Housing Goals Aut}^hority^{The authority to esta}^{blish and m}^{onitor housing goals for the e}^nte^{rprises is}^Simi^{lar provisions (Sec. 1128)}
^{moved to the Director from HU}^{D. (Sec. 337)}
^{Housing Goals, Gene}^ral^{There are t}^hree^{single-family housing goals and one multifamily housing goal.}^Simi^{lar, but no aut}^{hority given to}^{Director to remediate rate}
^{In addition, the enter}^{prises are}^r^{equired to p}^{rovide the Director with}^{disparities. (Sec}^{. 112}⁹⁾
^{sufficient infor}^{mation to determine if minorities are c}^{harged a diff}^erent
^{interest rate t}^han^{non-minorities. (Sec. 337)}
^Single-Fami^{ly Housing}^{The Director shall establish an}^nu^{al goals for the pu}^rchase^{by ea}^ch^enterp^rise^Simi^{lar, except for t}^reatment^{of s}^{ingle-family rental units. (Sec. 112}⁹⁾
^Goals^{of conventional, conforming, single-family, owner-occupied, purcha}^{se money}
^{mortgages financing}^housing^{for (}^{1) low-income families}^{, (2) very low-}
ⁱ^{ki/CRS-RL33940}^{income families, and (3) families t}^{hat reside in low-income areas. The}^{Director shall establish a sepa}^rat^{e low-income goal for mortgages}^{used to}
^g/w^refinance^{existing mortgages. (Se}^{c. 337)}
^s^.or
^le^ak^{Authority to Inc}^rease^{The Director may by}^{regulation increase t}^{he single-family goals set out}^{No comparable}^provision.
^Targets^{previously to reflect e}^xpected^ch^{anges in ma}^{rket pe}^rforma^{nce rela}^{ted to}
^://wiki^{such in}^{formation u}^{nder th}^{e Hom}^{e Mortgage Disclosure Act of}¹⁹^{75. In}^{establishing suc}^{h targe}^{ts, the Dir}^{ector shall consider (1) national h}^ousing
^h^ttp^{needs, (2) economic, housing, an}^{d demographic conditions, (3) th}^e
^performa^{nce a}^{nd effort of t}^{he en}^{terprises toward ac}^{hieving the}^ho^using
^{goals in previous years, (4) t}^{he si}^{ze of the conve}^{ntional mortgage market}
^{serving eac}^{h of the}^types^{of families relative to the size of the over}^all
^{conventional mortgage market, a}^{nd (5) the}^{need to maintain t}^{he s}^ound
^{financial condition of the enter}^pri^{ses. (Sec. 337)}
^{Multifamily Special}^{The Director shall establish, by}^r^{egulation, an ann}^{ual goal for the}^purc^hase^{The Director shall establish, by}^r^{egulation, an ann}^{ual goal for the}
^{Affordable Housing}^Goal^{by eac}^{h ente}^{rprise of ea}^{ch of t}^h^e^follow^{ing types of mortgages}^on^purc^hase^{by eac}^{h e}^nterp^{rise of m}^{ortgages on multifamily housing t}^hat
^{multifamily housing: (1) mortgages that fina}^{nce dwelling units for}^low-incom^e^{(1) finance dwelling u}^{nits affordab}^{le to very low-income families}^{, and (2)}
^{families, (2) mortgages that financ}^{e dwelling units for very low-income}^{that finan}^{ce dwelling units assiste}^{d by the low-income housing}^tax
^{families, and (3) mortgages that fi}^{nance dwelling u}^{nits assisted by t}^{he low-}^{credit. (Sec. 1128)}

^{income housing ta}^{x credit u}^nder^{section 42 of t}^{he I}^nter^{nal Revenu}^{e Code o}^f
¹⁹⁸^{6. (Sec. 33}⁷⁾

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Setting Multifamily Special}^{In esta}^{blishing the s}^{pecial multifamily affordable housing goal for a}ⁿ^Simi^{lar, except that}^the^{re is no re}^ference^{to a specific data sou}^{rce, and}
^{Affordable Housing}^Goal^enterp^{rise for a yea}^{r, the Directo}^{r shall consider: (1) national multifamily}^{Agency m}^{ust review goals an}^{nually for feasibility. (Sec. 1128)}
^{mortgage credit needs; (2) t}^{he pe}^{rformance a}^{nd effort}^{of the e}^nter^{prise in}
^{making mortgage credit available for multifamily housing in}^previou^{s years;}
^{(3) the size of the}^{multifamily mortgage market; (4) t}^{he a}^{bility of the}
^enterp^{rise to lead the indust}^{ry in}^{making mortgage credit available,}
^{especially for unders}^{erved mar}^ke^{ts, such as}^{for small multifamily p}^{rojects of}
^{5 to 50}^u^{nits, multifamily propert}^{ies in need of re}^{habilitation, and multifamily}
^{properties located in r}^{ural areas;}^{and (5) the}^{need to maintain t}^he^sound
^{financial condition of the enter}^pri^{se. \ Director to use a rolling thr}^ee-year
^{average of data collected under t}^{he Home}^{Mortgage Disclosure A}^ct.
^{(Sec. 337)}
^Additi^{onal Requirements}^{The Director shall establish, with}^{in the m}^{ultifamily special affordable housing}^Simi^{lar provisions (Sec. 1128)}
^{for Smaller Projects}^{goal, ad}^diti^{onal requirement}^{s for}^{the p}^urc^hase^{by eac}^{h ente}^rprise^of
^{mortgages for multifamily housin}^{g projects of a smaller or limited size, which}
^{may be}^{based on t}^{he n}^u^m^{ber of}^{dwelling units in the}^{project or th}^{e amount}
^{of the mortgage, or both, a}^{nd sha}^{ll include multifamily housing projects of}
ⁱ^{ki/CRS-RL33940}^such^{smaller sizes as are ty}^{pical among suc}^{h p}^{rojects that se}^{rve r}^u^{ral areas.}
^g/w^{(Sec. 337)}
^s^.or^{Units Financed by}^Housing^{The Director shall give credit toward the ac}^{hievement of t}^{he m}^ultifamily^Simi^{lar provisions. (Sec. 1128)}
^le^ak^{Finance Agenc}^{y Bonds}^{special affordable housing}^{goal to}^{dwelling units in multifamily hous}^{ing that is}
^{financed b}^y^tax-e^{xempt or}^taxa^{ble bonds issued}^{by a State or local housing}
^://wiki^{finance age}^{ncy, b}^{ut only if su}^ch^b^{onds are sec}^{ured by}^{a gua}^rantee^{of the}
^h^ttp^enterp^{rise, or are not inve}^stment^{grade and are}^pu^rchas^{ed by t}^he^enterp^{rise. (Sec. 337)}
^{Use of Tenant I}^{ncome or}^{The Director shall monitor the p}^erformance^{of each}^enter^{prise in}^meeting^Simi^{lar provisions. (Sec. 1128)}

^Rent^{housing goals and shall evaluate s}^uch^perfor^mance^{based on t}^{he in}^{come of}
^{the p}^{rospective or act}^{ual tenan}^ts^{of the p}^{roperty, w}^{here s}^u^c^h^{data are}
^{available; or where the data a}^{re n}^{ot available, rent levels affordable to low-}
^{income and very low-income fam}^ilies^{. A rent level shall be conside}^{red to be}
^{affordable if it does not exceed 3}^{0% of t}^{he maxim}^{um income level}^{of the}
^{income category, with app}^ropriat^{e adjustments}^{for u}^{nit size as me}^{asured b}^y
^{the n}^umbe^{r of b}^{edrooms. (Sec. 337)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Discretionary Adjustment}^{The Director may redu}^{ce the}^{level for a goal purs}^{uant to s}^{uch a}^p^{etition by}^{Regulated entity may petition Director to reduce t}^{he level of any g}^oal.
^{of Housing Goals}^{one of the e}^nter^{prises only if (1)}^{market and eco}^{nomic conditions or the}^{(Sec. 1128)}
^{financial condition of the enter}^pri^{se req}^{uire su}^{ch action; or (2) e}^ffo^{rts to}
^{meet the goal would result in t}^h^e^{constraint of liquidity, over-investment in}
^{certain market}^segment^{s, or othe}^{r conseq}^uen^{ces cont}^{rary to t}^{he intent of}
^{the law. (Sec. 337)}
^Definitions^{Very low-income}^{: in the}^{case of ow}^ner-occu^{pied units, income not i}ⁿ^exce^ss^Simi^{lar provisions. (Sec. 1128)}
^{of 50% of}^{area median income; a}^{nd in the}^{case of re}^{ntal u}^{nits, income not in}
^{excess of}⁵⁰^{% of area m}^{edian inc}^{ome, adjusted for family size.}
^{Low-income area}^{: cens}^{us tract}^or^{block num}^{bering a}^{rea in w}^{hich th}^{e median}
^{income does not exceed}^80%^{of t}^{he median income for}^{the a}^{rea in}^which
^such^cens^{us tra}^{ct or block n}^u^m^b^{ering area is located, and shall include}
^{families having incomes not great}^{er tha}^{n 1}⁰⁰^%^{of the a}^{rea median}^income
^{who reside in minority cens}^{us t}^r^a^cts.
^{Extremely low-income}^{: in t}^{he case}^{of owner-occupied u}^{nits, income not in}
^{excess of}³⁰^{% of the a}^{rea median}^{income; and (B) in the case}^{of re}^{ntal units,}
ⁱ^{ki/CRS-RL33940}^{income not in exc}^{ess of 3}^{0% of t}^{he area median i}^{ncome, with adjustments}
^g/w^{for family size.}
^s^.or^{Conforming mortgage}^{: a conventional mortgage having a}ⁿ^{original pr}^incipal
^le^ak^obligati^{on that does not ex}^{ceed t}^{he dollar limitat}^ion,^{in effect at t}^h^e^{time of}
^{such origination, specified in the}^enterp^{rise’s charte}^{r. (Sec. 337)}
^://wiki^Definitions^{“Rural” and “ru}^{ral area” as c}^urre^{ntly defined are re}^{vised to include}^{No comparable}^provision.
^h^ttp^{micropolitan areas and tribal tr}^us^{t lands. (Sec. 337)}
^{Duty to Serve}^{The enter}^{prises s}^{hall (1) pu}^rchas^{e mortgages on ho}^{using for ve}^{ry l}^{ow-, l}^ow-,^Simi^{lar provisions. (Sec. 1129)}
^{Underserved Markets}^{and moderate-income families involving a reasonable economic ret}^{urn t}^hat
^{may be less t}^{han t}^{he r}^etur^{n ear}ⁿ^{ed on other activities; and (2) hav}^{e the duty}
^{to improve the liquidity of and th}^{e distribution of capital available for}
^{mortgage financing}^{for u}^nderser^v^{ed markets. (Sec. 338)}
^Underserved^Markets^{Each e}^nter^{prise s}^{hall lead the industry in dev}^{eloping loan products}^and^Simi^{lar, except adds su}^bp^{rime, an}^{d Community Development Fina}^ncial
^{flexible underw}^{riting guidelines for: (1) manu}^factu^{red housing}^pu^rc^{hased by}^{Institutions loans. The en}^terp^{rises shall assist lenders to meet t}^heir
^{very low-, low-}^{, and moderate-in}^{come families; (2) affordable hous}^ing^{Community Reinvestme}^{nt Act (C}^{RA) obligat}^{ions. (Sec. 1129)}

^preser^{vation; (3) housing}^{for very}^low-,^low-^{, and moderate-income families}
^{in rural area}^{s, and for an}^{y other}^underse^{rved market}^{for ver}^{y low-, low}^-,
^{and moderate-income families that the Director identifies as lacking}
^{adequate c}^{redit throug}^{h conve}^{ntional lending sources. Such}^unde^r^served
^{markets may}^{be identified by}^bor^{rower type, mark}^{et segme}^{nt, or geographic}
^{area. (Sec. 338)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Evaluation and Reporting o}^f^{Not later than}^{six mont}^{hs afte}^{r t}^{he effe}^{ctive date, the Director sh}^all^Simi^{lar provisions, but the}^{Director may determine additional factors.}
^Compliance^{establish a man}^ner^{for evaluating}^whethe^{r, and the e}^xte^{nt to whic}^{h, the}^{(Sec. 1129)}
^enterp^{rises hav}^{e complied with t}^{he duty to se}^rve^underse^{rved ma}^{rkets and}
^{for rating the}^exte^{nt of s}^uch^{compliance. The Director shall ann}^ually
^{evaluate the com}^{pliance and rate}^{the pe}^rforman^{ce of eac}^{h ente}^rpri^{se. (Sec.}
³³⁸⁾
^Enforce^{ment of D}^{uty to}^{The duty to serv}^{e u}^nderserv^{ed markets s}^{hall be enforc}^{eable to t}^{he same}^Simi^{lar provisions. (Sec. 1129)}
^{Provide Mortgage Credit}^{extent a}^{nd u}^{nder t}^{he same}^{provisions that the}^housing^{goals are}
^{to Underserved Ma}^rkets^{enforceable. (Sec. 33}⁸⁾
^{Housing Goal E}^nforceme^nt^{If the Director}^{preliminarily determines that}^{an e}^nter^{prise ha}^{s failed, or is}^Simi^{lar provisions. (Sec. 1130)}
^{likely to fai}^{l to meet any housing}^{goal, the Director shall provide written}
^{notice including the rea}^{sons for s}^{uch dete}^{rmination. (Sec. 339)}
^{Cease and Desist Orders,}^{If the Director}^{finds that t}^here^{is a substa}^{ntial proba}^{bility that an e}^nterp^rise^Simi^{lar provisions, except gr}^eater^{civil money penalties. (Sec. 1130}⁾
^{Civil Money Penalties, and}^{will fai}^{l, or has actually failed, t}^o^{meet any}^{housing goal and tha}^{t t}^he
^{Remedies Including}^{achievement of t}^he^{housing goal was or is feasible, the Director m}^{ay req}^uire
^{Housing Plans}^{that the}^enter^{prise s}^{ubmit a}^hous^{ing plan. If t}^{he Director makes}^su^{ch a}
ⁱ^{ki/CRS-RL33940}^{finding and the}^enter^{prise re}^fuse^s^{to submit s}^{uch a}^{plan, su}^{bmits a}ⁿ
^g/w^unacce^ptable^{plan, fails to comply with the}^{plan or th}^{e Director fin}^{ds that}
^s^.or^{the ente}^rp^{rise has failed to meet}^{any hou}^{sing goal, in addit}^{ion to requiring}
^le^ak^{an ente}^{rprise to s}^{ubmit a}^housing^{plan, the Director may}^{issue a ce}^{ase and}^{desist order, impose civil money penalties, or order other re}^{medies as set}
^://wiki^{forth in t}^{his su}^{bsection. (Sec. 339}⁾
^h^ttp^{Review of Housing Plan}^{The Director shall review any}^su^{bmission by a}ⁿ^ente^rp^{rise, including a}^{housing plan, a}^{nd not later t}^han³⁰^{days after}^su^{bmission, approve}^or^Simi^{lar provisions. (Sec. 1130)}
^{disapprove the}^{plan or othe}^{r acti}^{on. The Director may exte}^{nd the}^period
^{for app}^{roval or disapproval for a}^{single additi}^{onal 30-day period. (S}^{ec. 339)}
^Additi^{onal Remedies for}^{The Director also may seek othe}^{r actions whe}^{n an}^enter^{prise fails}^{to meet}^a^Simi^{lar provisions. (Sec. 1130)}
^{Failure to Meet Goals}^{goal, and exercise app}^{ropriate en}^{forcement a}^{uthority available to the}
^{Director under t}^{his act to pro}^hib^{it the enter}^{prise f}^{rom initially off}^{ering any}
^{product or e}^{ngaging in a}^{ny new}^a^{ctivities, services, undertakings, and}
^{offerings and to order t}^{he e}^nterp^{rise to suspe}^{nd p}^{roducts and ac}^tivities,
^{services, underta}^{kings, and offeri}^{ngs pe}^{nding its achieveme}^{nt of t}^h^e^goal.
^{(Sec. 339)}
^Establishme^{nt of an}^{The Director of the Federal Hou}^{sing Finance Age}^{ncy (in cons}^{ultation with}^Simi^{lar provisions. (Sec. 1131)}

^{Affordable Housing F}^und^{HUD Secretary) shall establish a}ⁿ^d^{manage an a}^{ffordable hou}^{sing f}^{und. (Sec.}
³⁴⁰⁾

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Purpose of t}^{he Fu}^nd^{To increase homeowners}^{hip a}^nd^{the su}^{pply of}^{rental hou}^{sing amo}^{ng very}^Simi^{lar provisions. (Sec. 1131)}
^{low-income famil}^{ies, to increase i}^nvestme^{nt in}^pu^{blic infrastru}^ctur^{e, to}
^{increase invest}^{ment in}^low-incom^{e areas. (Sec. 340)}
^Allocat^{ion of Amounts by}^{For fiscal years 20}⁰⁷^thro^ugh²⁰¹^{1, each e}^nter^{prise shall allocate to the fu}^nd^{Each e}^nter^{prise s}^{hall contribute}⁴^{.2 basis points (0.0}⁴²^{%) of the}^un^paid
^Enter^prises^{1.2 basis}^{points (0.01}^{2%) of its av}^{erage total mortgage portfolio during the}^{principal balanc}^{es of its total new}^busine^{ss p}^urc^{hases. (Sec. 11}³¹⁾
^{preceding yea}^{r. (Sec. 340)}
^{Definition of “Tota}^l^{The term “total mortgage port}^{folio” means, with respect}^{to a year}^{, the sum}^{“Unpaid principal}^{balances of its t}^{otal new busine}^{ss p}^urc^hases”^not
^{Mortgage Portfolio”}^{of the dollar amount of the}^un^{paid outstanding pri}^{ncipal balances}^{on all}^defined.
^{mortgages outstanding du}^{ring tha}^{t year in a}^{ny form, including w}^{hole loans,}
^{mortgage-backed secu}^{rities, participation certificates, or other str}^uctur^ed
^{securities backed}^{by mortgages.}^{This includes all such mortgages}^or
^{securitized obligati}^{ons, whether}^r^{etained in portfolio or sold}^{in any}^form.
^{The Director is authorized to pr}^{omulgate rules f}^urthe^{r defining s}^u^{ch term}^s
^{as necessa}^{ry to implement}^{this se}^{ction and to address market}
^{developments. (Sec. 340)}
^{Limitation on}^{No comparable}^provision.^{Cannot be}^{used in co}^njunction^w^{ith prope}^{rty taken}^by^eminent^domain,
ⁱ^{ki/CRS-RL33940}^{Contributions}^{unless t}^{hat p}^{roperty is take}^{n for}^{public u}^{se. (Sec. 113}¹⁾
^g/w^{Suspension of}^{The Director shall temporarily su}^{spend t}^{he allocation by an e}^nter^p^{rise to}^Simi^{lar provision. (Sec. 1131)}
^s^.or^{Contributions}^{the affordable}^{housing f}^und^upon^{a finding by t}^{he Director that}^suc^h
^le^ak^allocat^{ions would contribute to t}^{he fina}^{ncial instability of the ente}^rprise,
^{would cause the e}^nter^{prise to be}^{classified as underca}^pitalized^{, or would}
^://wiki^preve^{nt the}^enter^{prise f}^{rom suc}^c^{essfully completing a ca}^{pital restoration}
^h^ttp^{plan u}^{nder Section 1}³⁶^{9C. (Sec. 340)}
^{Five-Year Sunset and}^{The enter}^{prises s}^{hall not be r}^e^q^u^{ired to make allocati}^{ons to the af}^fordable^{No suns}^{et p}^{rovision. (Sec. 1131)}
^Report^{housing f}^{und in}²⁰^{12 or}^{in any}^ye^{ar therea}^{fter. Not later t}^han^Ju^ne^{30, 2}⁰¹^1,
^{the Director shall su}^{bmit to Congress a re}^{port making}^recommen^{dations on}
^whethe^{r the}^fu^{nd should be}^exte^{nded or modified. (}^{Sec. 340)}
^{Affordable Housing}^Needs^{For 200}^{8, 7}^{5% of allocations shall go to the Louisiana Housing Fina}^nce^{In the}^{initial year (200}^{9), the f}^und^{would support}^the^HOPE^for
^{Formulas: All}^{ocations for}^{Agency; 2}^{5% to t}^{he Mississippi D}^{evelopment Aut}^{hority. (Sec. 340)}^{Homeowners Program. (Sec. 11}³¹⁾
²⁰⁰⁸
^{Affordable Housing}^Needs^{HUD Secretary s}^{hall establish a f}^{ormula to allocate funds to states}^and^{In all years, 2}^{5% of t}^{he f}^{und woul}^{d go to support a}^reserve^fu^{nd fo}^r
^{Formulas: All}^{ocations for}^{Indian tribes}^{based on}^{specified fa}^{ctors, including population, housi}^ng^{HOPE for}^Homeowners^bonds.^{During the}^{first th}^{ree yea}^{rs, a}
^{Later Years}^{affordability, percentage of e}^xtre^{mely low- and very low-income families,}^{decreasing pe}^rcentage⁽¹⁰^{0%, 5}⁰^{%, 25%) of t}^{he othe}^{r 7}^{5% would}^{go for}
^{and the e}^xtent^{of su}^bstandard^{housing. If s}^{uch a}^{formula is}^{not est}^ablished^{the HOP}^{E p}^{rogram. Of t}^{he 7}^{5% (}^{as adjusted), 65% would go to a}
^{by the}^{time the Director is to ma}^{ke allocati}^{ons, the allocations wi}^ll^be^{housing f}^{und similar to the Ho}^us^{e’s affordable housing}^fu^{nd; 35}^%^would
^{distributed to states based on}^H^{OME allocations to states and pa}^rticipant^{go to a Capital Magnet Fund to}^p^{rovide competitively awarded grants}
^{jurisdictions. (}^{Sec. 340)}^{to support}^{affordable ho}^{using for}^{primarily extre}^{mely low-, very lo}^w-,
^{and low-income families}^{. (Sec. 1131)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^Allocat^{ion of Formula}^{The Director shall determine th}^e^{formula amount}^{for eac}^{h gra}^nte^{e (states}^Simi^{lar provisions. (Sec. 1131)}
^Amounts^{and Indian tri}^{bes) and}^pu^{blish in t}^{he Federal Register the available}^amounts.
^{(Sec. 340)}
^{Recipients of Allocati}^ons^{Each g}^rantee^{may designate a stat}^{e housing fina}^{nce age}^{ncy, ho}^using^and^Simi^{lar provisions. (Sec. 1131)}
^{community development}^{entity, t}^{ribally designated housing entity,}^{or other}
^{qualified instrume}^{ntality of the gr}^{antee to receive gra}^{nts. (Sec. 34}⁰⁾
^Grantee^{Allocation Plans}^{Each g}^rantee^{shall establish and}^p^{ublish a}^{plan for distribution of g}^r^ant^Simi^{lar provisions. (Sec. 1131)}
^{amounts eac}^{h year. The}^{plan s}^{hall set forth}^req^uirement^{s for a}^{pplications to}
^{receive assistance. (Sec. 34}⁰⁾
^{Eligible Activit}^ies^{Grant a}^mounts^{shall be}^{used only}^{for (1) the}^{production, pre}^servat^{ion, and}^Simi^{lar provisions. (Sec. 1131)}
^{rehabilitation of rental housing, in}^{cluding housing}^{under t}^he^progra^ms
^{identified in Section 1335(a)(2)(B), except that}^suc^{h gra}^{nt amou}^nts^{may be}
^{used for th}^{e be}^{nefit only of ext}^re^{mely and very low-income families; (2) the}
^{production, prese}^{rvation, and re}^{habilitation of housing for homeo}^wners^hip
^{(including such}^{forms as down}^pay^{ment assistan}^{ce, closing cost assistance,}
^{and assistance}^{for interest-rate}^b^{uy-downs) for ext}^{remely and ve}^r^y^low-
ⁱ^{ki/CRS-RL33940}^{income first-time home b}^{uyers; a}^{nd (3) p}^{ublic infrast}^ruct^{ure devel}^opment
^g/w^{activities in connection with hous}^{ing activities funded u}^{nder pa}^ragr^{aph (1) o}^r
^s^.or^{(2). (Sec. 340)}
^le^ak^{Eligible Recipients}^{Funds may}^be^{provided only to o}^{rganizations, agencies, or entities (including}^Simi^{lar provisions. (Sec. 1131)}
^{for-profit, non-profit, or faith-bas}^{ed entities) (1) with a demonstra}^ted
^://wiki^{capacity for car}^{rying out eligible housing activities, and (2) that ma}^ke
^h^ttp^assura^{nces to the}^grante^{e (as re}^q^{uired by t}^{he Director) that t}^hey^will^{comply with the}^req^uirement^{s of}^{the p}^{rogram. (Sec. 340)}
^{Identification Requirement}^s^{Any assistance}^{provided with any}^{affordable housing}^grant^amount^{s may not}^{No comparable}^provision.
^{for Occu}^pan^{cy or}^{be made available to any individual or household unless t}^{he individual or, in}
^Assistance^{the case of a}^house^{hold, all a}^{dult members}^{of the}^house^{hold provide,}
^{personal identification in specifie}^{d forms. (Sec. 340)}
^{Required Minimum}^{Of aggregate amo}^{unts allocated each year,}^25%^{shall be}^{used by}^{Refcorp, as}^{No refere}^{nce to Refcor}^{p. The minimum state allocation would be}^$3
^Allocat^ions^{provided in Section 21B(f)(2)(E)}^{of the Federal Home Loan Ba}^nk^{Act (12}^mill^{ion. (Sec}^{. 113}¹⁾

^U.S.C^{. 1441}^{b(f)(2)(E)); not less th}^{an 1}^{0% s}^{hall be for}^homeowners^hip
^{activities; and, not more than 1}^{2.5% s}^{hall go to public infrastr}^uct^ur^e
^{projects. All funds must}^be^used^{or committed within two years of the gra}^nt
^{date, or be su}^{bject to recapt}^ure.^{(Sec. 340)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Prohibited Uses}^{The Director shall by reg}^{ulation, set forth}^{prohibited use}^{s of gra}^nt^amounts,^Simi^{lar provisions. (Sec. 1131)}
^{which s}^{hall include use for (}^{1) political activ}^{ities; (2) advocacy; (3) l}^obbying,
^whethe^{r directly or throug}^{h othe}^{r parties; (4) cou}^{nseling ser}^{vices; (5) travel}
^expe^{nses; and (}^{6) pre}^{paring or}^pr^{oviding advice on tax retur}^{ns. Th}^e
^{Director shall provide by reg}^{ulation that gra}^{nt amou}^{nts may}^{not b}^e^{used for}
^{administrative, outreach, or othe}^{r costs of the g}^rantee^{or any}^reci^{pient of}
^{such g}^{rant a}^{mounts, e}^xcept^that^{grant amou}^{nts may}^be^{used for}
^{administrative costs of the gra}^nte^{e of carrying out}^the^program^re^quired
^{under t}^{his section. (Sec. 340)}
^{Effect o}ⁿ^Housing^Goals^{Amounts cont}^ributed^{by t}^{he ente}^{rprises to th}^{e affordable}^housing^{fund s}^hall^Simi^{lar provisions. (Sec. 1131)}
^{not count toward meeti}^{ng housin}^{g goals or duty to serve. (Sec. 34}⁰⁾
^{Accountability of}^{The Director shall req}^{uire each}^g^{rantee to develop and maintain}^a^{system to}^Simi^{lar provisions. (Sec. 1131)}
^{Recipients and G}^rantees^ensu^{re that all recipient}^{s of fu}^nds^{use t}^{hose fu}^{nds in accorda}^{nce w}^{ith this}
^{section, and any ap}^{plicable regula}^{tions, requireme}^{nts, or conditions. The}
^{Director shall establish minimum}^requirem^ents^{for grant}^{ees and}^re^cipients,
^{which s}^{hall include approp}^{riate financial reporting, record}^retenti^{on, and}
ⁱ^{ki/CRS-RL33940}^{audit requirem}^{ents. (Sec. 34}⁰⁾
^g/w^{Misuse of Fu}^{nds b}^y^{If the Director or a}^grantee^(su^{bject to the Director’s review) det}^ermines^Simi^{lar provisions. (Sec. 1131)}
^s^.or^Recipients^{that any}^{recipient of a}^ssistance^ha^{s used an}^{y amou}^{nts in a ma}^nne^{r t}^{hat is}
^le^ak^{materially in violat}^{ion of this section, the regulations issued}^under^t^his^{section, or any re}^quireme^{nts or}^{conditions under whic}^{h su}^{ch am}^{ounts were}
^://wiki^{provided, the grantee s}^{hall req}^{uire that, within 1}²^mont^{hs afte}^{r th}^e^{determination of suc}^{h misuse, t}^h^e^{recipient s}^{hall reimbur}^{se the}^gr^{antee for}
^h^ttp^{misused amounts}^{and ret}^ur^{n to t}^{he gra}^{ntee any}^amount^{s that}^rem^ain
^unu^{sed or u}^{ncommitted for use.}^{The remedies u}^{nder t}^{his clause a}^{re in}
^additi^{on to any other r}^{emedies t}^{hat may}^{be available unde}^{r law. (Sec. 340)}
^{Reports by}^Gra^ntees^{The Director shall req}^{uire each}^g^{rantee re}^{ceiving affordable}^{housing fu}^nd^Simi^{lar provisions. (Sec. 1131)}

^{grant amou}^{nts for a}^{year to s}^ubm^{it an ann}^{ual report}^{to the Direct}^{or that}
^{describes the}^{activities funded u}ⁿ^{der this section and t}^{he ma}^nne^{r in which}
^{the gra}^{ntee complied with the all}^{ocation plan established for t}^{he g}^rantee.
^{The Director shall make thes}^{e re}^{ports p}^{ublicly available. (Sec. 340)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Misuse of Fu}^{nds b}^y^{If the Director dete}^{rmines, after}^{reasonable notice and op}^portu^{nity for}^Simi^{lar provisions. (Sec. 1131)}
^Grantee^s^{hearing, that a g}^rantee^has^{failed to comply substa}^{ntially with any p}^rovision
^{of this section and}^{until the Direc}^{tor is satisfied that there is}^{no longer a}^ny
^such^{failure to comply, the Direc}^{tor shall reduce t}^{he amou}^{nt of as}^sistance
^{under t}^{his section to the g}^rantee^{by an a}^{mount e}^{qual to t}^{he amou}^{nt of the}
^{affordable housing}^fu^{nd grant}^am^{ounts that}^were^{not used in a}^ccordance
^{with this section; re}^{quire t}^{he gra}^{ntee to repa}^{y an a}^{mount e}^{qual to}^the
^{amount of th}^{e affordable}^housing^{fund g}^{rant amo}^{unts w}^{hich we}^re^{not used}
^{in accordance with t}^{his section; limit the availability of assistance u}^{nder this}
^{section to the gra}^{ntee to activities or recipients}^{not affected}^{by s}^u^{ch failure}
^{to comply; or terminate any}^assis^{tance u}^{nder t}^{his section to the g}^r^antee.
^{(Sec. 340)}
^{Capital Requirements}^{The utilization or commitment of amounts}^{from the}^{affordable ho}^{using f}^und^{No comparable}^provision.
^{shall not be s}^{ubject to the}^risk-ba^{sed capital require}^{ments e}^stablished
^purs^uant^{to Section 13}^{61(a). (Sec. 340)}
^{GAO Study of Af}^fordable^{Directs the GA}^{O to report}^{on th}^{e affordable housing}^fu^{nd’s impac}^{t on the}^Simi^{lar provisions. (Sec. 1131)}
ⁱ^{ki/CRS-RL33940}^{Housing Fu}^nd^{affordability and availabil}^{ity of credit for home buy}^{ers. (Sec. 34}⁰⁾
^g/w^{Chapter 3—Prompt C}^orrecti^{ve Action}^Subtitl^{e C—Prompt Cor}^{rective Action}
^s^.or^{Capital Classificat}^ions^{The Director shall establish ca}^{pital classificati}^{ons for the FH}^{LBs, r}^eflecting^Simi^{lar provisions regarding the}^{Director’s authority to reclassify}^a
^le^ak^{differences in o}^{perations b}^etwee^{n the}^bank^{s and t}^{he e}^nterp^{rises. (Sec.}^{regulated entity. (Sec. 114}²⁾
^{151(a)) These}^{regulations are to}^{be issued within}¹⁸^{0 days of t}^he^effective
^://wiki^{date of this legislati}^{on. (Sec. 151(b)). The Director may reclassify a}^regulated
^h^ttp^{entity (1) whose cond}^{uct could r}^{apidly deplete core or total capital, or (in}^{the case of a}ⁿ^e^nterp^{rise) whose}^{mortgage assets ha}^{ve declined significantly}
^{in value, (2) which is deter}^mined^{(after notice and op}^portu^{nity for}^{a hearing)}
^{to be in an}^un^{safe or}^unsou^{nd co}^{ndition, or (3) which is engaging i}ⁿ^an
^unsafe^{or u}^nsound^{practice. (Sec. 34}^5(a))
^{Restriction on Capital}^{A regulated entity s}^{hall make no}^{capital distribution that would ca}^{use it to}^Simi^{lar provision. (Sec. 1142)}

^{Distributions}^{become u}^nderca^pitalized^{, except}^{that certain}^{capital restr}^uctu^ring
^{transactions may}^be^{permitted b}^y^{the Director if the}^{y improve t}^h^e^financial
^{condition of the entity. (Sec. 345(}^a))

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Supervisory Actions}^{The Director must}^{monitor an u}^{ndercapitalized entity’s condition,}^its^{Provisions simi}^{lar, except that}^an^underca^{pitalized GSE may not gr}^ow
^{Applicable to}^{compliance with its capital restor}^{ation plan, and the e}^{fficacy of t}^he^{plan. No}^{unless t}^{he ratio of its “tangible as}^{sets” to equity is inc}^{reasing. (House}
^{Undercapitalized Regulated}^{growth in total assets is pe}^{rmitted for an u}^nderca^{pitalized GSE, unless (1)}^{bill has “total capital” to assets.) (}^{Sec. 114}³⁾
^Entities^{the Director has a}^{ccepted t}^he^G^{SE’s capital restoration plan, (2) a}ⁿ^increase^{Agency m}^{ust reclassify}^{GSE as}^{significantly unde}^{rcapitalized for fail}^ure
^{in assets is consistent}^{with the}^pl^{an, and (3) the}^{ratio of total capital to}^{to comply with capital restoration plan. (Sec. 11}⁴³⁾
^{assets is increasing. An}^u^ndercapi^{talized entity shall not, d}^{irectly or}
^{indirectly, acquire any inte}^{rest in}^{any entity or initially offer any}^ne^{w produc}^t
^{(as such}^{term is defined in}^{section 1}³²^{1(f)) or engage in a}^ny^{new a}^ctivity,
^{service, undertaking, or offe}^ring^{without the Director’s p}^{rior appr}^{oval and}
^{determination that s}^{uch a}^{ctivities would be consistent wit}^{h the}^ca^pital
^{restoration plan. Actions that}^ma^{y be take}^{n u}^{nder c}^urre^{nt law wit}^{h regard}
^{to significantly underca}^{pitalized GSEs may be}^taken^{with regard to}
^underca^{pitalized GSEs, if the Director finds it necessa}^{ry. (Sec. 346)}
^{Supervisory Actions}^{Of the}^su^{pervisory actions t}^{hat t}^{he reg}^ulator^may^{take u}^{nder c}^urr^{ent law,}^{Identical provisions. (Sec. 1144)}
^{Applicable to Significantly}^{one or more of the}^following^must^{be take}^{n: new}^{election of Directors,}
^{Undercapitalized Regulated}^{dismissal of Directors and/or executives, and hiring of}^{qualified ex}^ecutive
^Entities^{officers, or other actions.}
ⁱ^{ki/CRS-RL33940}^{Without prior written a}^p^p^{roval of the Director, exec}^{utives of a sig}^nificantly
^g/w^underca^{pitalized regulated entity may not receive}^bonu^{ses or pa}^{y r}^aises.
^s^.or^{(Sec. 347)}
^le^ak^{Authority over Critically}^{The Director may ap}^{point (or th}^{e Agency ma}^{y serve}^{as) a receive}^{r or}^Simi^{lar provisions, but ma}^{ndatory receivershi}^{p occur}^{s after}⁶⁰^day^s,
^://wiki^{Undercapitalized}^Enter^{prises (Liq}^uidation^{conservator for s}^{everal spe}^{cified causes r}^{elated to financial difficulty and/or}^violat^{ions of law or regulation. Se}^{ts out powers of}^conservators^or^{instead of 30 days. The}^{Director would have discretionary aut}^{hority to}^{force receivers}^{hip du}^{ring days}³⁰^{to 60. Also, once receivershi}^{p is}
^h^ttp^Authority)^{receivers, and p}^rocedures^{for set}^{tlement of claims, disposal of assets, and}^{started, liquidation is mandatory.}^{(Sec. 1145)}

^{other aspe}^{cts of liquidation, including judicial review. Authorizes t}^he
^{Director to appoint a limited-l}^{ife regulated entity to deal with the}^{affairs of}
^{an entity in defa}^{ult. Prohibits a re}^{ceiver from ter}^{minating, revoking}^{, or}
^{annulling the}^char^{ter of a}^regulat^{ed entity.}
^{Mandatory rec}^{eivership: re}^quires^{the Director to ap}^{point the Age}^{ncy as a}
^{receiver if a reg}^{ulated entity’s ass}^{ets are (and}^{have b}^een^{for 3}⁰^day^{s) less}
^{than its obligations to its creditors, or if the reg}^{ulated entity has (f}^{or 30}
^{days) not been}^{generally pa}^{ying its debts as t}^{hey come d}^{ue. (Sec. 348)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Chapter 4—Enf}^or^{cement Ac}^tions^Subtitl^{e D—Enfor}^{cement Ac}^tions
^{Cease-and-Desist}^{The Director may issue}^cease-an^{d-desist orders against a regulate}^{d entity, a}^Simi^{lar provisions. (Sec. 1151)}
^Proceedings^{regulated entity-affiliated party, or the Federal Home Loa}^{n Bank Fi}^nance
^{Corporation (created by Sec. 2}⁰^{4) for u}^{nsafe or}^un^sound^practice^{s (actual}
^{or imminent), violati}^{ons of laws and regulations, or for a rec}^{eiving a less-}
^{than-satisfactory}^{rating for asset}^{quality, earnings, manage}^{ment, or}^liquidity,
^{where t}^{he identified deficiency is not corrected. This aut}^{hority may not be}
^{used to enforce}^{compliance with}^{housing goals. (Sec. 352)}
^{Temporary Cease-and-}^{If a violation (or threatened violation) or an unsa}^{fe or}^unsou^{nd pr}^{actice is}^Simi^{lar provisions. (Sec. 1152)}
^{Desist Proceedings}^{likely to cause insolvency or significant dissipation of assets or ear}^{nings of a}
^{regulated entity, or is likely to w}^{eaken the}^{condition of the reg}^{ulated entity}
^{prior to the completion of cease-}^{and-desist proceedings, the Direc}^{tor may}
^{issue a tempora}^{ry order r}^e^q^{uiring the reg}^{ulated entity to cease a}ⁿ^d^desist
^{from any s}^u^c^h^{violation or practice and to take affirmative a}^{ction to prevent}
^{or remedy su}^{ch insolvenc}^{y, dissipation, conditi}^{on, or prejudice pen}^ding
^{completion of such}^proceedings.^{The Director may ap}^{ply to the U}^{.S. D}^istric^t
ⁱ^{ki/CRS-RL33940}^{Court for an i}^{njunction to en}^forc^{e suc}^{h tempora}^{ry order. (Sec. 35}²⁾
^g/w^{Prejudgment Attac}^hment^{Permits the cour}^{ts to freeze as}^se^{ts, funds, or other}^prope^{rty of}^pe^rsons^{No comparable}^provision.
^s^.or^{subject to civil or administrative actions for violations. (}^{Sec. 353)}
^le^ak^Enforce^{ment a}^nd^{The Director may ap}^{ply to the U}^{.S. D}^{istrict Court for the District}^of^Simi^{lar provisions, but removes}^f^{ederal court jurisdiction over actions}
^://wiki^Jurisdiction^{Columbia, or the U.S. d}^{istrict court within t}^{he jurisdiction of whic}^{h the}^headqua^{rters of t}^{he reg}^{ulated ent}^{ity is located}^{, for the en}^forcemen^{t of any}^brought^pr^{udential manageme}^nt^{and operation standards}^{in Section}¹³¹^{3B. (Sec. 115}⁴⁾
^h^ttp^{effective and outsta}^{nding notice}^{or order issued, or req}^{uest t}^{hat t}^he
^{Attorney Ge}^{neral b}^{ring s}^{uch a}ⁿ^a^{ction. The court shall have j}^{urisdiction and}
^{power to req}^{uire compliance wit}^{h suc}^h^{notice or order. (Sec. 354}⁾
^{Civil Money Penalties}^{Establishes t}^{hree tiers}^{of fines: (1}^{) $10,0}⁰⁰^{per day}^{for violations o}^f^orders,^{Same tiers of penalties and adds}^{“any conduct}^{that t}^{he Director}
^{(2) $5}^0,00^{0 pe}^{r day for r}^{ecklessly engaging in a}ⁿ^u^nsafe^{or u}^nsoun^{d practice,}^{determines to be a}ⁿ^u^nsafe^{or u}ⁿ^{sound pra}^{ctice” to tier 1. (Sec. 1}¹⁵⁵⁾
^{or a patter}^{n of misconduct}^{or ma}^{terial breach of}^{fiduciary duty wit}^{h finan}^cial
^{gain to the entity or individual, and (3) up to a ma}^{ximum of}^$2^milli^{on per}
^{day for knowingly engaging in}^viol^{ations, breaches of}^{fiduciary dutie}^{s, or}
^unsafe^{or u}^nsound^{practices t}^hat^{cause s}^ubsta^{ntial losses to a regulated}
^{entity. (Sec. 355)}
^{Indemnification}^Exte^{nds cu}^rrent^pro^{hibition on indemnification for tier 3 p}^enalties^{to all}^{No similar provision.}

^{tiers. (Sec. 355)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Removal and Prohibition}^{After written}^{notice and op}^portu^{nity for a hea}^{ring, the Director m}^ay^Simi^{lar provisions. (Sec. 1153)}
^Authority^suspe^{nd or remove}^{regulated ent}^{ity-affiliate}^{d parties who have}⁽¹⁾^{violated a}
^{law, a cease-and-desist, or other written order, (2) engaged in a}ⁿ^unsafe^or
^unsou^{nd pra}^{ctice, or (3) breac}^he^{d fiduciary duty, suc}^{h that}^{(1) the}^regulated
^{entity is likely to suffer loss (or the ente}^{rprise-affiliated party}^rece^ive
^{financial gain), and (2) the}^unsafe^{or unsou}^{nd p}^{ractice involves per}^sonal
^{dishonesty or demonstrates}^{willful and continui}^{ng disregard for t}^h^e^safety
^{and soundne}^{ss of th}^{e reg}^{ulated entity. Also provides for industry-}^wide
^suspe^{nsions u}^{nder ce}^{rtain circ}^um^{stances. Provides for judicial revi}^{ew of}
^{such order}^{s or s}^uspe^{nsions. (Sec. 35}⁶⁾
^{Criminal Penalty}^{Anyone w}^{ho participates, directly or indirectly, in the affairs of a}^r^egulated^{Identical provisions. (Sec. 1156)}
^{entity while unde}^{r sus}^pe^{nsion or}^{order of removal shall be liable f}^{or a fine}
^{of up to $}¹^{million, or five years’ imprisonment. (Sec. 35}⁷⁾
^{Subpoena A}^uthority^{Authorizes the Director to issue}^sub^{poenas. (Sec. 358)}^Simi^{lar provisions, but ex}^pands^gr^{ounds for issuing}^a^su^bpoe^{na and}^adds
^{criminal penalties for failure to an}^{swer a s}^u^b^{poena. (Sec. 115}⁸⁾
ⁱ^{ki/CRS-RL33940}^{Chapter 5—}^{General Provisions}^Subtitl^{e E—General Provisions}
^g/w^Enter^{prise Boards of}^{Eliminates the re}^quirem^{ent t}^{hat fi}^{ve Directors on the}^{boards of Fa}^{nnie Mae}^Simi^{lar provisions. (Sec. 1162)}
^s^.or^Directors^{and Freddie Mac be a}^ppointed^by^{the President. Reduces t}^{he size}^of^enterp^{rise boards f}^{rom 1}⁸^{to 1}^{3, unless t}^{he Director determine}^{s t}^hat
^le^ak^another^num^{ber is a}^ppro^{priate. (Sec. 361)}
^://wiki^{Study on Public Use}^{No provision}^{Requires data re}^{ported by}^GSEs^{to the p}^{ublic to be at t}^{he ce}^nsus^tract
^h^ttp^{Database and Data}^Disclosure^{level. (Sec}^{. 1126)}
^{GSEs m}^{ust disclose certain single}^{family data under}^{HMDA. (Sec. 1127)}
^{Study on Mortgage Defa}^ult^{No provision.}^{Requires t}^{he Director to per}^{form a study on de}^{fault risk evaluati}^on.
^{Risk Evaluation}^{(Sec. 1502)}
^{Report on E}^nter^prise^{The Director shall report to Con}^{gress, within 1}²^mont^{hs of e}^nact^{ment, on}^{No provision.}

^Portfoli^os^{the portfolio holdings of the ente}^{rprises, the}^{risk implications for t}^he
^enterp^{rises of su}^ch^{holdings and t}^{he conse}^que^{nt risk ma}^nageme^nt
^undertake^{n b}^y^the^enter^{prises (in}^{cluding the u}^{se of derivatives for}^hedging
^pur^{poses), whethe}^{r port}^{folio hol}^{dings serve safet}^{y and sou}^ndnes^s^pur^poses,
^whethe^{r portfolio holdings fulfill t}^{he mission of the e}^nter^{prises, an}^{d the}
^{potential systemic risk implicatio}^{ns for t}^{he ent}^erp^{rises, the}^housin^{g and}
^{capital markets, and the}^finan^{cial system of port}^{folio hol}^{dings, and whethe}^r
^such^{holdings should be limited or reduced over}^{time. (Sec. 362)}

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Study of Alternative}^{The Director, in consultation with the Federal Reser}^{ve, the Treas}^{ury, and}^{No provision.}
^{Secondary Market Syste}^ms^{HUD, shall conduct a study of t}^h^e^{effects on}^finan^{cial and housing}^finance
^{markets of alternatives}^{to the c}^u^r^{rent seco}^{ndary marke}^{t system}^{for housing}
^{finance, taking into consideration}^{changes i}ⁿ^the^stru^cture^{of finan}^c^{ial and}
^{housing fina}^{nce ma}^{rkets a}^{nd institutions since t}^{he creation of t}^he
^enterp^{rises. This study is to be}^c^{ompleted within 12}^months^{of th}^{e effective}
^{date of this legislati}^{on. (Sec. 364)}
^{Study of Gua}^{rantee Fees}^{No provision}^{Director shall conduct an ongoin}^{g study of gua}^rantee^{fees a}^{nd an}ⁿ^ually
^{report to Congress}^{regarding am}^{ount and c}^{riteria used to determi}^ne
^{fees. (Sec. 150}¹⁾
^Subtitl^{e B—F}^{ederal Home L}^{oan Banks}^{TITLE II—Federal Home Loan Banks}
^{No provision.}^{Orders t}^{he Director to take into account differ}^ences^betwee^{n th}^e
^enterp^{rises and t}^{he Home}^Loan^{Banks in taking s}^upe^{rvisory or}
^enforceme^{nt actions. (Sec. 120}¹⁾
^{Directors, Numbe}^r^{Each FH}^{LB will be managed by}^a^{board of 13}^{directors, or other n}^umbe^{r as}^Simi^{lar provisions. (Sec. 1202)}
ⁱ^{ki/CRS-RL33940}^{the Director of FHFA determine}^{s. (Sec. 372)}
^g/w^{Directors, Citi}^zenship^{Board directors must be U.S. citi}^{zens. (Sec. 372)}^{Same provision (Sec. 1202)}
^s^.or^{Directors, Members}^{Majority of directors of each FHL}^{B must be}^{officers of me}^mber^ba^{nks of}^{Identical provision.}
^le^ak^{that FHLB. Mem}^{ber directors s}^h^a^{ll be elected by the}^membe^{rs. Ele}^ction
^{does not include independe}^{nt directors. (Sec. 372)}^Membe^{r directors and inde}^pende^{nt directors to be elected}^{by th}^e^{members. (Sec. 12}⁰²⁾
^://wiki
^h^ttp^{Directors, Independe}^nt^{At least 2/5 of eac}^{h Bank’s direct}^{ors must}^{be indepe}^{ndent. I}^ndepe^ndent^{Not less than t}^{wo-fifths of board}^members^must^{be inde}^pende^nt
^{directors shall be ap}^{pointed by t}^h^e^{Director of the FHFA. Inde}^pen^dent^{directors. (Sec. 1202)}
^{directors will residents of the District of the Bank. (Sec. 27}²⁾^{No similar provision.}
^{The Director shall take into cons}^{ideration the demographic make}^{up of t}^he
^{community most se}^{rved by}^{the A}^{ffordable Housing Program}^{of the}^{Bank in}
^{appointing indepe}^{ndent directors}^{. (Sec. 272)}
^{Directors, Independe}^nt,^{At least two of the indepe}^ndent^{directors for each Ba}^{nk shall be}^c^hosen^Simi^{lar provisions, except t}^{hat th}^{e two directors must}^{have more}^than
^{Public Intere}^st^{from consu}^mer/commu^{nity orga}^{nizations with more than}^{a two y}^ear^{four years}^ex^perience^rep^rese^{nting commu}^{nity or cons}^{umer inte}^r^ests.
^{history. (Sec. 372)}^{(Sec. 1202)}
^{Directors, Independe}^nt,^Indepe^{ndent directors w}^{ho are}ⁿ^{ot public interest}^{directors shall}^have^{No provision.}
^Other^{financial expe}^{rtise. (Sec. 372)}
^{Directors, Independe}^nt,^{An indepe}^{ndent director may}^not^{serve as a}ⁿ^{officer of a}^{FHLB or}^member^{No provision.}

^{Conflicts of Interest}^{bank du}^{ring directorship. (Sec. 37}²⁾

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^{Directors, Terms}^{Terms increased f}^{rom th}^{ree to f}^{our years. Terms}^{will be staggere}^{d so that}^{Identical provision. (Sec. 1202)}
^{1/4 are}^{completing eac}^{h year}^rat^{her t}^han^{1/3. The c}^hange^{in term}^length
^{does not apply to cu}^rre^{nt directors. (Sec. 372)}
^{Voting Power of Member}^Membe^{r ba}^{nks s}^{hall have votes in}^{proportion to the a}^{mount of FH}^{LB stock}^{No provision.}
^Banks^{they hold. The provision that eac}^{h state}^{have at least t}^{he n}^umb^er^of
^{directors it had in 19}⁶⁰^{is repeal}^{ed. (Sec. 372)}
^{Oversight By}^{New Agen}^cy^{The FHFA replaces t}^{he Fina}^{nce B}^{oard. (Sec. 373)}^Simi^{lar provisions. (Sec. 1204)}
^{Information Sharing}^{A FHLB may ha}^{ve access}^{to infor}^{mation needed to determine ext}^{ent of its}^{Director shall facilitate sharing of certain information among}^FHLB^s,
^{joint and several liability}^{. Information sharing p}^urs^uant^{to liability d}^{oes not}^{subject to limitations regarding p}^{roprietary data. (Sec. 120}⁷⁾
^{waive any p}^{rivilege. (Sec}^{. 375)}
^{FHLB Reorganization and}^{FHLBs may merg}^{e with other}^FH^{LBs with the a}^p^p^{roval of the FHF}^A^{FHLBs may merg}^{e with other}^FH^{LBs with the a}^p^p^{roval of the Dire}^ctor,
^{Voluntary Merge}^r^{Director. (Sec. 376)}^{who shall issue reg}^{ulations governing suc}^{h tra}^{nsactions. (Sec. 12}⁰⁹⁾
^{The nu}^mber^{of FHLB districts ma}^{y be red}^{uced to fewer}^tha^{n 8 as}^a
^{result of voluntar}^{y merge}^{rs or liq}^{uidation of a bank. (Sec. 121}⁰⁾
ⁱ^{ki/CRS-RL33940}^{SEC Disclosures}^{FHLBs are e}^xempt^{from some SE}^{C reporting reg}^{ulations, including}^Simi^{lar provisions. (Sec. 1208)}
^g/w^{ownership of}^{capital stock in the}^{FHLB, tender offers}^{related to FHLB}^{capital stock, and reporting relat}^{ed party tra}^{nsactions in t}^{he FH}^L^B^system.
^s^.or
^le^ak^{Shares of FHLB ca}^{pital stock are}^{defined as “exem}^{pted sec}^{urities” for the}
^pur^{poses of defining a gove}^rnme^{nt sec}^{urities broker or a}^govern^ment
^://wiki^{securities dealer. (Sec. 377)}
^h^ttp^{Community Financial}^{Raises the Total Asset Requirem}^{ent from}^$5^{00 million to $1 billio}^{n. (Sec.}^Simi^{lar provision. (Sec. 1211)}
^{Institution Me}^mber^s³⁷⁸⁾
^{Refinancing Aut}^hority^{No provision.}^{FHLBs are given a}^{uthority to re}^finance^{mortgages on}^primary
^{residences of families at or below 80%}^{of area median in}^{come. (Sec.}
¹²¹⁸⁾
^Studies^{The Comptroller of the Cu}^rre^nc^{y will conduct a study of th}^{e FHL}^B^{Director shall conduct a study}^of^{securitization of member}^bank^h^ome
^{affordable housing}^programs^and^{submit t}^{he re}^{port within one}^yea^{r. (Sec.}^{mortgage loans. (Sec. 1215)}
³⁸⁰⁾^{Director shall conduct a study}^of^{FHLB advances r}^{elated to}
^{nontraditional mortgages. (Sec. 1}²¹⁷⁾
^{Effective Date}^{Six months f}^{rom enactme}^{nt. (Sec. 381)}^{The date of enactme}^{nt, u}^{nless otherwise p}^{rovided. (Sec}^{. 116}³⁾

^Provision^{H.R. 3}^{221 (House Approved}^{May 8, 2}^008)/^H^.^R^.¹⁴²⁷^{H.R. 3}^{221 (S}^{enate Approved}^{July 11, 2}⁰⁰⁸⁾
^Subtitl^{e C—Transfer o}^f^Fun^c^{tions, Personnel, and Proper}^{ty of}^{Title III—Transfer of Fun}^ctio^{ns, Personnel, and Pr}^{operty Of}
^{Office o}^f^{Federal Housing}^En^{terprise Oversight, Federal}^Housing^{OFHEO and the Federal Ho}^{using Finance Boa}^rd
^{Finance Board, a}^{nd Departm}^{ent of Housing a}^{nd U}^rban
^Development
^{Chapter 1—Offi}^{ce of Federal}^{Housing Enterp}^{rise Oversight}^Subtitl^{e A—OFHEO}
^{Abolishment of OFH}^EO^{Sets the abolishment}^{of OFHE}^O^{six months a}^{fter e}^nactme^{nt. Provides for}^{OFHEO is a}^{bolished one year aft}^{er enactm}^{ent. Provides for continuity}
^{continuity of employee stat}^{us, us}^{e of prope}^{rty, and agen}^{cy ser}^{vices. Suits}^{of employee status, u}^{se of p}^rope^{rty, and agency}^{services. (Sec. 13}⁰¹⁾
^{and other actions in}^progress^aga^{inst OFHE}^{O will be transf}^{erred t}^o^{the new}
^{agency. (Sec. 385)}
^{Continuation of}^{All regulations, orders, resoluti}^o^{ns, and determinations made}^by^{OFHEO or}^Simi^{lar provisions. (Sec. 1302)}
^{Regulations and Orders}^{a court will remain in force, and}^{become en}^{forceable b}^y^the^new^agency.
^{(Sec. 386)}
^{Transfer of}^Em^ployees^{Governs t}^{he tra}^nsfe^{r of OFH}^EO^{employees to FHFA employment}^and^{Governs t}^{he tra}^nsfe^{r of OFH}^EO^{employees to FHFA employment}^and
^{from OFHE}^O^{provides for continuity in}^be^nefit^{programs. (Sec. 38}⁷⁾^{provides for continuity in}^be^nefit^{programs. (Sec. 13}⁰³⁾
ⁱ^{ki/CRS-RL33940}^{Abolishment of the}^Federal^{Housing Finance}^Board^{Provides for the tran}^{sition from FHFB to FHFA with provisions similar to}^{Sections 301-}³⁰^{3. (Sec. 388-3}⁹⁴⁾^Simi^{lar provisions. (Secs. 1311-1}³¹⁴⁾
^g/w
^s^.or^{Termination of Ente}^rprise-^{Directs the Secretar}^{y of HUD to}^{determine, within th}^{ree mont}^hs^of^{Provides for transfer}^{of certain}^H^{UD employees to FHFA.}
^le^ak^{Related Functions at HUD}^{enactment, w}^{hich em}^{ployees to transfe}^{r to the FHFA to maintain}^oversight^{of the ente}^rp^{rises. Six months f}^r^{om enactment, all suc}^{h oversight}^functions^{(Sec. 1133)}
^://wiki^{are to be tra}^nsfe^{rred to the}^new^{agency. (Sec. 394)}
^h^ttp^{Provides for continuity of employ}^{ee status, reg}^{ulations, use of pro}^{perty, and}
^{agency se}^{rvices. Provides for tran}^{sfer from}^{HUD of related app}^rop^riations,
^{property, a}^{nd facilities. (Sec}^{. 396-}³⁹⁸⁾
^Source:^{Compiled by CRS.}

^M^a^r^k^Jⁱ^c^k^lⁱ^ng ^Ed^w^a^{rd V. Mu}^rphy
^Sp^{ecialist i}ⁿ^Fiⁿ^aⁿ^c^{ial Eco}ⁿ^o^m^ics^Aⁿ^a^l^ystⁱⁿ^Fi^na^ncⁱ^a^l^E^c^oⁿ^o^mⁱ^c^s
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^{N. Er}^{ic W}^e^iss
^Sp^{ecialist i}ⁿ^Fiⁿ^aⁿ^c^{ial Eco}ⁿ^o^m^ics
^e^w^ei^s^s^@^c^rs^.l^oc.g^o^v^{, 7-}⁶²⁰⁹

^B^a^r^b^ar^{a Miles, f}^o^r^m^er^Sp^ecial^{ist in}^Fin^aⁿ^c^{ial I}ⁿ^sti^t^u^tioⁿ^s^{, co}ⁿ^t^rⁱ^b^u^ted^to^thⁱ^s^r^e^p^o^r^t.