Section 1 Short title
This Act may be cited as the “Emergency Relief for State, Territorial and Local Governments Act of 2020”.
Emergency Relief for State, Territorial and Local Governments Act of 2020
A BILL
To authorize Federal reserve banks to purchase COVID–19 related municipal issuances, and for other purposes.
Sec. 2 Purchase of COVID–19 related municipal issuances
Amendment to authority To buy and sell bonds and notes— Section 14(b) of the Federal Reserve Act (12 U.S.C. 355) is amended—
in paragraph (1)—
by inserting “and during unusual and exigent circumstances,” before “bonds issued”; and
by striking “of 1933” and all that follows through “assured revenues”; and
by adding at the end the following:
“(3) State defined—In this section, the term “State” means each of the several States, the District of Columbia, each territory and possession of the United States, and each federally recognized Indian Tribe.”
Federal Reserve authorization To purchase COVID–19 related municipal issuances—
Authority— Within seven days after the date of enactment of this subsection, the Federal Reserve Board of Governors shall establish a facility to buy and sell, at home or abroad, bills, notes, bonds, and warrants that are issued by any State or political subdivision thereof between March 1, 2020, and July 1, 2021, in order to fund a public health or public service response to the COVID–19 pandemic. The Board of Governors of the Federal Reserve System may extend the authority under this subsection if the Board determines necessary.
Required purchases— The Board of Governors of the Federal Reserve System shall establish policies and procedures to require the direct placement of bills, notes, bonds, and warrants described in paragraph (1) with the Board at an interest cost that does not exceed the Federal funds rate target for short-term interbank lending, within seven days after the date of enactment of this section.
Review of spending— During the 3-year period beginning on the date on which all purchases under this section are completed, relevant Federal authorities shall review such purchases to determine if funds were diverted from legitimate public health or public services responses to the COVID–19 pandemic to make such purchase. The relevant Federal authorities shall take appropriate action based on findings of such review.
Definitions— In this subsection:
Public health or public service response to the COVID–19 pandemic— The term public health or public service response to the COVID–19 pandemic means—
the purchase, manufacture, or delivery of medical equipment, facilities, or services—
to treat or quarantine COVID–19 patients;
to protect first responders interacting with such patients; or
to test for COVID–19 infections and track social contacts of patients who have tested positive for the virus;
the purchase, manufacture, or delivery of basic living supports for individuals who are not COVID–19 patients during periods of voluntary or mandatory social distancing or quarantine designed to prevent the spread of COVID–19; or
the maintenance and delivery of basic public services to communities responding to the public health or economic effects of the COVID–19 pandemic.
State— The term State means each of the several States, the District of Columbia, each territory and possession of the United States, and each federally recognized Indian Tribe.