Bill Summary
The Fairness in Disaster Relief Act is a bill that proposes amending the Robert T. Stafford Disaster Relief and Emergency Assistance Act. This amendment would allow for the reimbursement of interest expenses incurred by local governments during disaster relief efforts. The President would have the authority to provide financial assistance to local governments for qualifying interest payments, which are defined as the lesser of the actual interest paid or the interest that would have been paid if the loan had an interest rate equal to the average prime rate. This assistance would apply to loans that are used to fund activities related to disaster relief efforts. The purpose of this act is to provide fair and reasonable financial support to local governments during times of crisis.
Possible Impacts
1. Local governments may be able to receive financial assistance for interest payments related to disaster relief, which could alleviate some of the financial burden placed on them by natural disasters. This could have a positive effect on the affected communities by allowing them to access necessary funds without incurring additional interest expenses.
2. The definition of "qualifying loan" in this Act may limit the types of loans that local governments can receive reimbursement for. This could affect people by limiting their access to certain types of loans for disaster relief, potentially making it more difficult for them to recover from a disaster.
3. The requirement that at least 90% of the loan proceeds be used for activities related to disaster relief could impact the way local governments allocate funds and resources in the aftermath of a disaster. This could have a ripple effect on the affected communities, potentially affecting the availability and quality of disaster relief services for individuals.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 3407 Introduced in Senate (IS)]
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116th CONGRESS
2d Session
S. 3407
To amend the Robert T. Stafford Disaster Relief and Emergency
Assistance Act to provide for the authority to reimburse local
governments for interest expenses, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 5, 2020
Mr. Rubio (for himself and Mr. Scott of Florida) introduced the
following bill; which was read twice and referred to the Committee on
Homeland Security and Governmental Affairs
_______________________________________________________________________
A BILL
To amend the Robert T. Stafford Disaster Relief and Emergency
Assistance Act to provide for the authority to reimburse local
governments for interest expenses, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Fairness in Disaster Relief Act''.
SEC. 2. REIMBURSEMENT OF INTEREST PAYMENTS RELATED TO PUBLIC
ASSISTANCE.
Title IV of the Robert T. Stafford Disaster Relief and Emergency
Assistance Act (42 U.S.C. 5170 et seq.) is amended by adding at the end
the following:
``SEC. 431. REIMBURSEMENT OF INTEREST PAYMENTS RELATED TO PUBLIC
ASSISTANCE.
``(a) In General.--The President may provide financial assistance
to a local government as reimbursement for qualifying interest.
``(b) Definitions.--In this section, the following definitions
apply:
``(1) Prime rate.--The term `prime rate' means the average
predominant prime rate quoted by commercial banks to large
businesses, as determined by the Board of Governors of the
Federal Reserve System.
``(2) Qualifying interest.--The term `qualifying interest'
means, with respect to a qualifying loan, the lesser of--
``(A) the actual interest paid to a lender for such
qualifying loan; and
``(B) the interest that would have been paid to a
lender if such qualifying loan had an interest rate
equal to the prime rate most recently published on the
Federal Reserve Statistical Release on selected
interest rates.
``(3) Qualifying loan.--The term `qualifying loan' means a
loan--
``(A) obtained by a local government; and
``(B) of which not less than 90 percent of the
proceeds are used to fund activities for which such
local government receives assistance under this Act
after the date on which such loan is disbursed.''.
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