18 U.S.C. § 4129: Authority to borrow and invest

Summary

Federal Prison Industries may issue obligations (IOUs) to the Treasury if the company’s board approves and Congress provides money in appropriations Acts. The Treasury Secretary may buy those IOUs, but the total outstanding cannot be more than 25 percent of Federal Prison Industries’ net worth. Net worth means assets minus liabilities. The Treasury can use proceeds from selling securities under chapter 31 of title 31 issued after the date of the enactment of this section to make these purchases. Each purchase must earn at least a rate the Treasury sets, based on current yields on similar U.S. marketable securities. The Treasury may later sell any obligations it buys. All buys and sells are treated as U.S. public debt transactions. Federal Prison Industries may also ask the Treasury Secretary to invest extra money from the Prison Industries Fund in U.S. public debt securities. The board picks suitable maturities. Interest rates on those investments are set by the Treasury Secretary, who will consider current market yields on similar U.S. securities.

Title 18, §4129

Crimes and Criminal Procedure, Source: USLM XML via OLRC

(a)(1)As approved by the board of directors, Federal Prison Industries, to such extent and in such amounts as are provided in appropriations Acts, is authorized to issue its obligations to the Secretary of the Treasury, and the Secretary of the Treasury, in the Secretary’s discretion, may purchase or agree to purchase any such obligations, except that the aggregate amount of obligations issued by Federal Prison Industries under this paragraph that are outstanding at any time may not exceed 25 percent of the net worth of the corporation. For purchases of such obligations by the Secretary of the Treasury, the Secretary is authorized to use as a public debt transaction the proceeds of the sale of any securities issued under chapter 31 of title 31 after the date of the enactment of this section, and the purposes for which securities may be issued under that chapter are extended to include such purchases. Each purchase of obligations by the Secretary of the Treasury under this subsection shall be upon such terms and conditions as to yield a return at a rate not less than a rate determined by the Secretary of the Treasury, taking into consideration the current average yield on outstanding marketable obligations of the United States of comparable maturity. For purposes of the first sentence of this paragraph, the net worth of Federal Prison Industries is the amount by which its assets (including capital) exceed its liabilities.

(2)The Secretary of the Treasury may sell, upon such terms and conditions and at such price or prices as the Secretary shall determine, any of the obligations acquired by the Secretary under this subsection. All purchases and sales by the Secretary of the Treasury of such obligations under this subsection shall be treated as public debt transactions of the United States.

(b)Federal Prison Industries may request the Secretary of the Treasury to invest excess moneys from the Prison Industries Fund. Such investments shall be in public debt securities with maturities suitable to the needs of the corporation as determined by the board of directors, and bearing interest at rates determined by the Secretary of the Treasury, taking into consideration current market yields on outstanding marketable obligations of the United States of comparable maturities.

Editorial Notes

References in Text

The date of the enactment of this section, referred to in subsec. (a)(1), is the date of enactment of Pub. L. 100–690 which was approved Nov. 18, 1988.

§4129 Authority to Borrow and Invest

Summary

Title 18, §4129

Notes & Related Subsidiaries

Editorial Notes

References in Text

Citations & Metadata