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October 2008
Within 7 days after there is an aggregate commitment to purchase the first $50 billion of troubled assets,
and within 7 days of each subsequent commitment to purchase $50 billion in troubled assets, Treasury is
required to submit to the appropriate Congressional committees a written “Tranche” report that includes a
description of-- all transactions during the period, pricing mechanisms, impact on the financial system,
challenges remaining in the financial system, benchmarks to be achieved, estimate of additional actions
necessary, and a justification of the price paid for transactions.
By April 30, 2009, Treasury is required to provide the appropriate Congressional committees a
“Regulatory Modernization Report” analyzing the current state of the regulatory system and its
effectiveness in overseeing participants in the financial markets, including the over the counter swaps
markets and GSEs, and making recommendations for improving the system including whether there are
participants in the market that are currently outside the regulatory system that should be subject to
regulation.
Section 106 – Management, Sale and Revenues
Authorizes Treasury to manage and sell assets under the program, enter into transactions and to transfer
revenues to the general fund of the Treasury to reduce the public debt.
Section 107 – Contracting
Authorizes Treasury to waive the provision of the Federal Acquisition Regulation (FAR), which governs
Federal agency responsibilities in acquisition of supplies and services with government appropriated
funds. If FAR is waived, Treasury is required to submit a justification, within 7 days, to the Committees
on Oversight and Government reform, House Financial Services and Senate Banking, and the Committees
on Homeland Security and Governmental Affairs. If Treasury has waived any provisions of FAR relating
to minority and women contracting, it must develop standards and procedures to ensure that minorities
and women are used and included to the maximum extent practicable.
The FDIC is eligible for consideration as asset managers for residential mortgage loans and asset backed
securities, with reimbursement for services by Treasury.
Section 108 – Conflicts of Interest
Requires Treasury to establish guidelines and regulation governing conflicts of interest that may arise in
execution of authority under the Act, including conflicts in hiring, purchase of troubled assets,
management of troubled assets, post employment restrictions and other potential conflicts.
Section 109 – Foreclosure Mitigation Efforts
Requires Treasury to provide foreclosure avoidance assistance to borrowers living in properties securing
assets which are acquired under the TARP program. Treasury is also required to assist renters in staying
in rental properties acquired under the program.
Specifically, Treasury must implement a plan to minimize foreclosures on properties (including
multifamily properties) securing the mortgages, mortgage backed securities and other assets it acquires.
Treasury must encourage servicers of underlying mortgages to use the HOPE for Homeowners Program
AMERICAN BANKERS ASSOCIATION 3