HR 5915 IH
101st CONGRESS
2d Session
 H. R. 5915
To authorize the creation of the Energy Corporation of the Northeast and
to authorize the Secretary of the Treasury to provide guarantees for the
obligations of such corporation and other financial assistance to such
corporation.
IN THE HOUSE OF REPRESENTATIVES
October 24, 1990
Mr. MURTHA introduced the following bill; which was referred jointly to
the Committees on Energy and Commerce, Banking, Finance and Urban Affairs,
and the Judiciary
A BILL
To authorize the creation of the Energy Corporation of the Northeast and
to authorize the Secretary of the Treasury to provide guarantees for the
obligations of such corporation and other financial assistance to such
corporation.
  Be it enacted by the Senate and House of Representatives of the United
  States of America in Congress assembled,
CHAPTER I--INTRODUCTORY
SHORT TITLE
  SECTION 1. This Act shall be known and may be cited as the `Regional Energy
  Development Act of 1990'.
TABLE OF CONTENTS
CHAPTER I--INTRODUCTORY
Sec. 1. Short title.
Sec. 2. Congressional findings and declaration of purposes.
Sec. 3. Definitions.
CHAPTER II--ORGANIZATION, MANAGEMENT, POWERS
Sec. 4. Creation; membership.
Sec. 5. The corporation; board of directors; staff.
Sec. 6. Powers of the corporation: General.
Sec. 7. Powers of the corporation: Subsidiaries.
Sec. 8. Condemnation and eminent domain.
Sec. 9. Permits.
Sec. 10. Indemnification.
Sec. 11. Conflict of interest.
Sec. 12. Assistance to departments.
Sec. 13. Annual report; audits; biennial review.
Sec. 14. Withdrawal by member States; termination.
CHAPTER III--PROJECTS AND PROGRAMS OF THE CORPORATION
Sec. 15. Projects and programs of the corporation.
Sec. 16. Findings regarding projects and programs.
Sec. 17. Limitation upon investment in any project or program.
Sec. 18. Prohibition against control of any project after the start-up period.
Sec. 19. Transfer of projects; transferee.
Sec. 20. Allocation of projects and programs to member States.
Sec. 21. Gubernatorial review.
Sec. 22. Regional energy planning.
CHAPTER IV--FINANCING
Sec. 23. Capital contributions by member States.
Sec. 24. Capital securities.
Sec. 25. Issuance of obligations.
Sec. 26. Moneys of the corporation.
Sec. 27. Authorized indebtedness.
Sec. 28. Security for obligations.
Sec. 29. Power to enter agreements with the United States.
Sec. 30. Consent of United States or member States not necessary for issuance
of obligations.
Sec. 31. Remedies of holder of obligations.
Sec. 32. Credit of United States not pledged.
CHAPTER V--GUARANTEE OF OBLIGATIONS
Sec. 33. Authorization of Secretary to guarantee obligations.
Sec. 34. Terms of guaranteed obligations.
Sec. 35. Administrative expense and loan guarantee funds.
Sec. 36. Default on guaranteed obligations.
Sec. 37. Guaranteed obligations not tax exempt.
Sec. 38. Purchase of guaranteed obligations by the United States prohibited.
Sec. 39. Other financial assistance to the corporation.
CHAPTER VI--STATE LEGISLATION
Sec. 40. State legislation required.
Sec. 41. Exemption from taxation.
Sec. 42. Condemnation and eminent domain.
Sec. 43. Permits; time limit for review; exemptions.
Sec. 44. Assistance by departments.
Sec. 45. Obligations as legal investments.
Sec. 46. Moneys of the corporation.
Sec. 47. Inconsistent provisions of other laws superseded.
Sec. 48. Credit of the State not pledged.
Sec. 49. Jurisdiction of courts.
Sec. 50. Consent of the State not necessary for issuance of obligations.
Sec. 51. Construction.
Sec. 52. Separability.
Sec. 53. Effective date.
CHAPTER VII--MISCELLANEOUS
Sec. 54. Construction.
Sec. 55. Separability.
CONGRESSIONAL FINDINGS AND DECLARATION OF PURPOSES
  SEC. 2. (a) The Congress hereby determines that--
  (i) energy shortages and the high cost of energy have created economic
  dislocations and hardships, including loss of jobs, closing of factories
  and businesses, and general economic stagnation or deterioration in the
  Nation and certain regions thereof;
  (ii) such hardships and dislocations constitute a threat to the general
  welfare and can be dealt with efficiently and effectively through an
  approach in which such regions cooperate with the United States;
  (iii) it is in the interest of the Nation and such regions to provide the
  means for such cooperation to facilitate increased energy supply and to
  encourage energy and conservation within their regions through an entity
  capable of financing and otherwise promoting such goals;
  (iv) fulfillment of such goals requires large initial investments of
  capital and prolonged periods before such investments can be returned,
  and entities capable of financing and otherwise promoting such goals, are,
  as a consequence, likely to encounter difficulties in obtaining adequate
  financing at reasonable costs;
  (v) financial assistance, including guarantees by the United States of the
  obligations of such entities, is necessary to encourage the formation of
  such entities.
  (vi) energy shortages and the high cost of energy have created particular
  economic dislocations and hardships in the Northeastern States, which
  would especially benefit from regional cooperation with the United States
  through an entity capable of financing and otherwise promoting increased
  energy supply and energy conservation.
  (b) The purposes of the Act shall be--
  (i) to create the Corporation to evaluate, on a regional basis, the factors
  affecting the production, distribution, storage and conservation of energy
  in the Northeastern States, and the impact of public policies thereon;
  (ii) to create the Corporation to stimulate and finance projects and programs
  (each as defined in section 3 of the Act) related to the production,
  distribution, storage, and conservation of energy;
  (iii) to create the Corporation to stimulate and finance efforts to create,
  within the Northeastern States, new industries and technologies related
  to the production, distribution, storage, and conservation of energy;
  (iv) to guarantee the obligations of the Corporation and otherwise to
  give financial assistance to the Corporation in order to promote increased
  energy production, distribution, storage, and conservation capabilities; and
  (v) to promote long-term cooperation among the Northeastern States on their
  shared problems of energy development and conservation, and to encourage
  other States of the United States to cooperate, on a regional basis, on
  shared problems of production, distribution, storage, and conservation
  of energy.
To this end, a corporation shall be created pursuant to the Act, and such
corporation shall be known as the Energy Corporation of the Northeast.
DEFINITIONS
  SEC. 3. As used in the Act, the following words and terms shall have the
  following meanings:
  `Act' means this Regional Energy Department Act of 1977.
  `Additional capital contributions' of any member State means amounts to
  be appropriated and paid to the corporation by such member State after
  the appropriation and payment by such member State of its initial capital
  contribution.
  `Board' means the board of directors of the corporation.
  `Corporation' means the corporation authorized to be created pursuant to
  section 4 of the Act.
  `Director' means a member of the board.
  `Federal director' means a member of the Board appointed by the President
  of the  United States, as provided herein.
  `Guaranteed obligations' means obligations, whose principal and interest
  are guaranteed by the  United States pursuant to section 32 of the Act.
  `Initial capital contribution' of a Northeastern State means the amount
  determined by multiplying $1 by the population of such Northeastern State,
  as determined by the most recent decennial census conducted by the  United
  States Census Bureau.
  `Member State' means any Northeastern State that makes an initial capital
  contribution to the corporation pursuant to section 22 of the Act and,
  unless waived by the board pursuant to section 39 of the Act, enacts
  legislation substantially in the form of sections 40 through 52 of the Act.
  `Northeastern States' means the States of Connecticut, Maine, New Hampshire,
  New Jersey, New York, Rhode Island, and Vermont, the Commonwealths of
  Massachusetts and Pennsylvania, and any other State of the  United States
  contiguous with any State that makes an initial capital contribution to
  the corporation pursuant to section 22 of the Act and, unless waived by the
  board pursuant to section 39 of the Act, enacts legislation substantially
  in the form of sections 40 through 52 of the Act.
  `Obligations' means the notes, bonds, and other obligations as so designated
  and issued by the corporation pursuant to the Act.
  `Outside director' means a director elected by holders of capital securities
  issued pursuant to section 23 of the Act.
  `Participant' means a person who develops, manages, assists in the
  development or management of, whether through financial means or otherwise,
  or otherwise engages in a project or program.
  `Person' means a natural person, a corporation, a partnership, a firm,
  an association, a joint venture, a trust, any unincorporated organization
  or other entity, including, but not limited to, a regional entity, a
  governmental entity, or a political subdivision, agency, or instrumentality
  of a governmental entity.
  `Program' means any activity that is not a project and that is undertaken
  or financed by the corporation to carry out any one or more of the
  corporation's purposes.
  `Project' means a specific activity undertaken or financed by the
  corporation to carry out any one or more of the corporation's purposes
  and that is designed or expected to produce revenues: Provided, however,
  That an activity that is expected to be devoted principally to research,
  development, or experimentation shall not be considered a project for
  the purposes of the Act as long as such activity remains principally so
  devoted. For example, projects may include, but shall not be limited to,
  activities intended to stimulate or finance (i) the increased development of
  coal and petroleum for energy and coal gasification, (ii) the development
  of an efficient transportation and delivery system to move coal from
  mine to consumer, (iii) the development and production of new energy
  conservation and storage products, facilities, or technologies, (iv) the
  development of onshore facilities and distribution systems for offshore
  oil and gas reserves, (v) the renovation and rehabilitation of existing
  powerplants and hydroelectric facilities, and (vi) the development of new
  powerplants. These examples shall not be construed to limit the rights of
  the Board pursuant to section 15(e) of the Act.
  `Secretary' means the Secretary of the Treasury of the  United States.
  `Start-up period' of a project means, with respect to a project involving
  capital expenditures, the period during which the project is being
  constructed and, with respect to other projects, the period during which the
  project is being developed, in each case prior to the time during which the
  project is producing substantial revenues, all as determined by the board.
  `State director' means a member of the board appointed by the Governor of
  a member State, as provided herein.
  `State stock' means securities issued to a Northeastern State after creation
  of the corporation in consideration for the initial capital contribution
  of a Northeastern State to the corporation pursuant to section 22 of the
  Act, and unless waived by the board pursuant to section 39 of the Act,
  the enactment of legislation by a Northeastern State substantially in the
  form of sections 40 through 52 of the Act.
  `Subsidiary' means any entity in which the corporation holds securities
  sufficient to enable the corporation to elect 50 per centum or more of
  the members of the governing body of such entity.
  `Total capital subscriptions' of the corporation means, at any time, the
  sum of (i) the initial capital contributions and the additional capital
  contributions of the member States theretofore paid to the corporation, and
  (ii) the aggregate proceeds that the corporation has theretofore received
  from the sale of capital securities of the corporation issued pursuant to
  section 23 of the Act.
  `Transferee' means any person other than the corporation that the board
  determines to be an appropriate participant in a project pursuant to
  section 19 of the Act.
  `United States' means the United States of America, any agency or department
  thereof, or any entity established by Congress and owned, in whole or in
  part, by the United States.
CHAPTER II--ORGANIZATION, MANAGEMENT, POWERS
CREATION; MEMBERSHIP
  SEC. 4. (a) There is authorized to be created a corporation for profit,
  which will not be an agency or establishment of the United States, and shall
  be known as the Energy Corporation of the Northeast. The corporation shall
  be subject to the provisions of the Act and, to the extent consistent with
  the Act, to the laws of the District of Columbia, including the District
  of Columbia Business Corporation Act. The right to repeal, alter, or amend
  the Act at any time is expressly reserved.
  (b) The President of the United States shall appoint incorporators who
  reside in one of the nine Northeastern States specifically named in
  section 3 of the Act, by and with the advice and consent of the Senate,
  who shall serve as the initial board of directors until their successors
  shall be appointed. Such incorporators shall arrange for an offering of
  State stock to the Northeastern States and take whatever other actions are
  necessary to establish the corporation, including the filing of articles
  of incorporation, as approved by the President of the United States.
  (c) A Northeastern State shall become a member State of the corporation
  when such Northeastern State shall subscribe for State stock, make its
  initial capital contribution to the corporation pursuant to section 22 of
  the Act and, unless saived by the board pursuant to section 39 of the Act,
  enact legislation substantially in the form of sections 40 through 52 of
  the Act: Provided, however, That no Northeastern State other than the nine
  specifically named in the definition of `Northeastern States' in section
  3 of the Act may become a member State after the second anniversary of the
  incorporation of the corporation pursuant to the provisions of this section
  4, without the approval of a majority of the members of the board. If at
  least three Northeastern States shall not have made a subscription for
  State stock on or before December 31, 1978, shall not have made initial
  capital contributions within twelve months of such subscriptions pursuant
  to section 22 of the Act and, unless waived by the board pursuant to section
  39 of the Act, shall not have enacted legislation substantially in the form
  of sections 40 through 52 of the Act within such twelve-month period, the
  Act shall no longer be effective and, in such case, if any Northeastern
  State shall have theretofore made an initial capital contribution to
  the corporation, the Act shall be null and void with respect to such
  Northeastern State and the amount of the initial capital contribution to
  the corporation from such Northeastern State shall be refunded.
  (d) The corporation's existence shall be perpetual, subject to the right
  of the United States to repeal, alter, or amend the Act at any time and
  to the provisions with respect to the termination of the corporation in
  section 14 of the Act.
THE CORPORATION; BOARD OF DIRECTORS; STAFF
  SEC. 5. (a) The corporation shall be administered by the board. After three
  Northeastern States shall become member States, the President of the United
  States shall appoint five directors, by and with the advice and consent of
  the Senate. One director shall be appointed by the Governor of each member
  State with such legislative concurrence, if any, as may be provided by the
  laws of each such member State. Of the five Federal directors, the terms
  of three such directors shall, by designation of the President of the
  United States, expire on the first June 30 following their appointments,
  and the terms of the others shall expire on the third June 30 following
  their appointments. Of the first seven State directors, the terms of the
  first, third, fifth, and seventh such directors shall expire on the second
  June 30 following their appointments, and the terms of the others shall
  expire on the fourth June 30 following their appointments. Thereafter,
  the term of each director shall be four years. Each Federal director
  shall reside in a member State. Each State director shall reside in the
  member State whose Governor appointed such director. Directors shall be
  eligible for reappointment and there shall be no limit to the number of
  terms a director may serve. A director shall serve until his successor
  shall by duly appointed and qualified. Each director may engage in private
  employment, or in a profession or business, full-time or part-time. No
  elected official or other employee of the United States or of a member
  State, or of any agency, department, or political subdivision of the United
  States or of any member State shall be eligible to serve as a director. For
  purposes of this section 5(a), an individual shall be deemed an employee
  of the United States or of a member State, or of any agency, department,
  or political subdivision of the United States or of a member State, if the
  principal occupation of such individual is as such an employee, or if such
  individual receives compensation that equals or exceeds $20,000 per annum
  for services as such an employee.
  (b) Outside directors shall be elected by the holders of the capital
  securities of the corporation issued pursuant to section 23 of the Act in
  such manner, for such term, and with such rights, limitations, and powers as
  may be provided in the resolution pursuant to which such capital securities
  are issued or in the bylaws of the corporation. In no event shall there
  be more than two outside directors. Each outside director shall reside in
  a member State.
  (c) The board may adopt, and from time to time amend, such bylaws and
  other rules for its conduct and for the management of the corporation,
  which shall not be inconsistent with the Act, as the board may determine.
  (d) A Federal director or an outside director may be removed or suspended
  from office for cause, as provided by the law of the District of Columbia. A
  State director may be removed or suspended from office for cause, as provided
  by the law of the member State from which such State director was appointed.
  (e) In the event of a vacancy on the board, by reason of the death,
  resignation, removal, or suspension of a director, or otherwise, the
  President of the United States, in the case of Federal directors, or
  the Governor of the member State from which such director was appointed,
  in the case of State directors, shall appoint another director, for the
  unexpired term only, by and with the advice and consent of the Senate,
  in the case of Federal directors, and with such legislative concurrence,
  if any, as may be provided by the laws of such member State, in the case
  of State directors.
  (f) The directors shall serve without salary, but each director shall be
  entitled to reimbursement for the actual and necessary expenses incurred
  in performing any official duties as a director.
  (g) At least two Federal directors and two-thirds of the total number of
  State directors shall constitute a quorum for the transaction of any business
  at any meeting of the board. The concurrence of at least 50 per centum of
  the directors present at any meeting and constituting a quorum shall be
  necessary for the taking of any action or exercise of any power by the board.
  (h) any action or exercise of any power required or permitted to be taken by
  the board may be taken without a meeting if at least two Federal directors
  and at least two-thirds of the total number of State directors consent in
  writing to the adoption of a resolution authorizing the action or exercise
  of power. The resolution and the written consents thereto by the directors
  shall be filed with the minutes of the proceedings of the board.
  (i) One or more directors may participate in a meeting of the board
  by means of a conference telephone or similar communications equipment
  allowing all directors participating in the meeting to hear each other
  at the same time. Participation by such means shall constitute presence
  at the meeting for the purpose of determining the existence of a quorum
  pursuant to section 5(g) of the Act.
  (j) The board may delegate to one or more of its directors, officers,
  agents, or employees such powers and duties as the board may determine.
  (k) The board shall annually elect a chairman from among the directors
  by such rules as the board shall adopt. The chairman shall serve at the
  pleasure of the board, and shall preside over all meetings of the board
  at which the chairman is present and shall have such other duties as the
  board may from time to time determine.
  (l) The board shall appoint, prescribe the duties for and fix the
  compensation of an executive director, who shall be the chief executive
  officer of the corporation. Subject to the supervision and control of the
  board, the executive director shall direct the work of the corporation.
  (m) The fiscal year of the corporation shall be as determined by the board.
POWERS OF THE CORPORATION: GENERAL
  SEC. 6. Except as inconsistent with specific provisions of the Act, and
  to help effect the purposes of the Act, the corporation shall have power--
  (a) to sue and be sued in its corporate name and to commence any action
  to protect or enforce any right conferred upon the corporation by any law,
  contract, agreement, or other source;
  (b) to make and alter bylaws for its organization and management;
  (c) to have and use a seal, which the board may alter at its pleasure;
  (d) to engage the services of consultants to render professional, technical,
  or other assistance and advice;
  (e) to maintain offices and staff within or without the member States to
  carry out its purposes and to exercise its powers under the Act;
  (f) to procure insurance against any loss in connection with its property
  and operations in such amounts and from such insurers as it deems proper;
  (g) to be a promoter, a partner, a joint venturer, a shareholder or
  associate, or to participate in any other capacity with other persons to
  carry out the purposes of the corporation;
  (h) to pledge and to grant security interests in any property, including,
  but not limited to, revenues of the corporation, subject to any agreements
  with holders of obligations;
  (i) to borrow money and issue obligations, to fund or refund such obligations
  and to provide for the rights and remedies of the holders of obligations on
  such terms and in such manner as it deems proper to carry out the purposes
  of the corporation;
  (j) to receive capital contributions and to issue capital securities as
  provided in section 23 of the Act;
  (k) to receive gifts, grants, and other gratuitous transfers from any person;
  (l) to create, organize, and manage subsidiaries, whether wholly or
  partially owned, subject, however, to the restrictions on ownership and
  operation of projects and programs contained in the Act;
  (m) to collect rents, fees, tolls, and other amounts with respect to
  projects or programs or otherwise;
  (n) to construct, reconstruct, rehabilitate, improve, alter, repair,
  use, receive, take, exchange, transfer, acquire, convey, assign, lease,
  sublease, mortgage, pledge, make a purchase money mortgage, or any other
  financing arrangement in connection with, otherwise encumber, deal in or
  with, hold, purchase, buy, sell, or otherwise acquire or dispose of any
  property, and to execute and deliver deeds in connection with any or all
  of the same transactions whenever necessary or convenient to carry out
  the purposes of the corporation;
  (o) to acquire, by grant or purchase, property from any member State or
  any instrumentality or political subdivision thereof;
  (p) to make and execute any and all contracts necessary or convenient to
  carry out the purposes of the corporation;
  (q) to invest moneys or funds of the corporation in securities, accounts,
  funds, or otherwise to carry out the purposes of the corporation, subject,
  however, to the restrictions contained in the Act with respect to certain
  investments;
  (r) to make payments to any member State or any instrumentality or political
  subdivision thereof in lieu of taxes;
  (s) to coordinate the relationships between and among the member States
  and the United States with respect to energy-related matters, including,
  but not limited to, the study of, the application for and the administration
  of grants made by the United States that may be, or may be made, available
  to the member States or to the corporation in any circumstances in which
  such activities would not duplicate the activities of any member States
  or any instrumentality or political subdivision thereof;
  (t) to take any action required in the application for permits as provided
  in section 9 of the Act; and
  (u) to do any and all things necessary or convenient to carry out its
  purposes and to exercise its powers pursuant to the Act.
POWERS OF THE CORPORATION: SUBSIDIARIES
  SEC. 7. (a) The corporation is authorized to exercise any or all of its
  powers and to carry out any or all of its purposes through one or more
  subsidiaries. The corporation may, by resolution of the board, authorize
  the organization and management of such subsidiaries pursuant to the laws
  of any member State or the District of Columbia governing the organization
  of business, not-for-profit, public benefit, or any other corporations
  or other organizations. Except as may be limited by the laws of the
  jurisdiction under which it is organized, a subsidiary may have all the
  rights and powers of the corporation, subject to any limitations upon such
  rights and powers contained in the Act with respect to the corporation.
  (b) Except as otherwise provided in the Act or in any agreement with
  holders of obligations, the corporation may transfer to any subsidiary
  any property in order to carry out the purposes of the corporation.
  (c) No director shall receive any additional compensation, directly or
  indirectly, other than reimbursement for the actual and necessary expenses
  incurred in the performance of such director's duties, by reason of his
  serving as a member, director, or trustee of any subsidiary.
CONDEMNATION AND EMINENT DOMAIN
  SEC. 8. The corporation, upon a finding by a resolution of the board, which
  includes a statement of the basis for such finding, that it is necessary or
  convenient in order to carry out the purposes of the corporation to acquire
  any real property, or any interest therein, for immediate or future use,
  and notwithstanding that such real property or any interest therein may
  already be devoted to a public use, may request that the member State in
  which such real property is located exercise its powers of condemnation,
  eminent domain, or other such similar powers as the member State shall
  lawfully possess, to acquire such real property or any interest therein
  for the account and benefit of the corporation.
PERMITS
  SEC. 9. If, and to the extent that, the implementation of any project or
  program in which the corporation is a participant requires any license,
  permit, exemption, waiver, or other approval (collectively `permits') of or
  from any officers, departments, agencies, bureaus, boards, or commissions of
  any member State, or any instrumentality or political subdivision thereof
  (the `issuing agency'), the corporation may, and upon the request of a
  participant in such project or program, shall, use its best efforts to
  apply for and obtain such permits from the issuing agency.
INDEMNIFICATION
  SEC. 10. The corporation shall save harmless and indemnify any person who
  shall have served as a director, officer, or employee of the corporation
  against financial loss or litigation expense arising in connection with
  any claim, demand, suit, or judgment, or the defense thereof, based on a
  cause of action, whenever accrued, involving allegations that pecuniary
  harm was sustained by any person as a result of any transaction of the
  corporation. In the event any such claim, demand, suit, or judgment shall
  occur, a director, officer, or employee of the corporation shall be saved
  harmless and indemnified by the corporation under this section 10 unless
  such individual is found by a final judicial determination not to have
  acted in good faith, for a purpose that he reasonably believed to be
  in the best interests of the corporation or not to have had reasonable
  cause to believe that his conduct was lawful. In any suit described in
  the first sentence of this section 10, any director, officer, or employee
  made a party defendant to such suit shall be entitled to be represented by
  private counsel of his choice: Provided, however, That the corporation is
  authorized, as a condition to indemnification of the fees and expenses of
  such representation, to require that appropriate groups of such individuals
  be represented by the same counsel: And provided further, That with the
  approval of the corporation, indemnification for such fees and expenses
  shall be paid from time to time during the pendency of such suit. The
  provisions of this section 10 shall inure only to the benefit of directors,
  officers, and employees of the corporation, shall not affect the rights
  or obligations of any other party and shall not impair, limit, or modify
  the rights and obligations of any insurer under any policy of insurance.
CONFLICT OF INTEREST
  SEC. 11. (a) All directors shall disclose to the board all financial
  interests or other affiliations, direct or indirect, in or with all persons
  that the corporation may purchase from, sell to, borrow from, loan to,
  contract with, or otherwise deal with or engage in any such transaction
  with. All such disclosures shall be reflected in the minutes of the board,
  and no director may participate in any decision of the board authorizing
  or otherwise affecting any such transaction with any such person.
  (b) Subject to the requirements of this section 11, the Act shall
  not be construed to prevent the corporation, any member State, or any
  instrumentality or political subdivision of any member State from purchasing
  from, selling to, borrowing from, loaning to, contracting with, or otherwise
  dealing with or engaging in any such transaction with any person in which
  any director has a financial interest or an affiliation, direct or indirect.
  (c) Except as otherwise provided in section 5 of the Act, a director may,
  while serving as a director, also serve as a director, officer, or employee
  of any other person. Such service by a director shall not constitute a
  conflict of interest or a breach of any fiduciary duty or any other duty
  of care or loyalty to the corporation.
ASSISTANCE TO DEPARTMENTS
  SEC. 12. Upon the request of any officer, department, agency, bureau,
  board, or commission of any member State or any instrumentalities or
  political subdivisions thereof (the `departments'), the corporation is
  authorized to provide technical, administrative, and other services to the
  departments, to cooperate with the departments in carrying out the purposes
  of the corporation and to transfer to a department, at such department's
  expense, such officers and employees including officers and employees of any
  departments theretofore transferred to the corporation at the corporation's
  request, as the corporation and such department deem necessary to assist
  such department in carrying out the purposes of the corporation, all as
  consistent with the corporation's normal functions and within the limits of
  available funds. Officers and employees of the corporation so transferred
  shall not, as a consequence of such transfer, lose or forfeit any rights
  they may have pursuant to any contract of employment with the corporation.
ANNUAL REPORT; AUDITS; BIENNIAL REVIEW
  SEC. 13. (a) The corporation shall submit to the President of the  United
  States, the Secretary, and the Congress, as well as to the Governor
  and legislature of each member State, within six months after the end
  of each of the corporation's fiscal years, a complete and detailed
  report with respect to such fiscal year (the `report'), setting forth:
  (i) a summary of the corporation's operations for such fiscal year;
  (ii) the corporation's revenues and expenditures for such fiscal year
  and the corporation's balance sheet as at the end of such fiscal year,
  each in accordance with the categories and classifications established
  by the corporation; and (iii) a schedule of the corporation's obligations
  and capital securities outstanding at the end of such fiscal year, with a
  statement of the amounts issued and redeemed or paid during such fiscal year.
  (b) The corporation's financial statements included in the report shall be
  audited and reported upon by the independent certified public accountants of
  the corporation in accordance with generally accepted accounting principles.
  (c) The Governors of the member States shall designate a person to
  review and evaluate the performance and operations of the corporation on
  a biennial basis beginning with respect to the corporation's second full
  fiscal year. The Governors of the member States shall chosen the person to
  perform such biennial review on a rotating basis, in alphebetical order
  of the member States, and no Governor may choose the person to perform
  such biennial review until the Governors of all alphabetically preceding
  member States shall have chosen, or waived or otherwise failed to choose,
  such person. When the person shall have completed such biennial review,
  its report on such biennial review shall be submitted to the President
  of the United States, the Secretary, and the Congress, as well as to
  the Governor and legislature of each member State, and such report shall
  be made promptly thereafter. The corporation shall bear all reasonable
  expenses incurred in connection with the preparation, submission, and
  making public of such report.
WITHDRAWAL BY MEMBER STATES; TERMINATION
  SEC. 14. (a) Any member State may, by appropriate act of its legislature,
  withdraw from the corporation at any time. After such withdrawal by a member
  State from the corporation, the term of the State director appointed from
  such member State shall end and such director may no longer participate
  in any activities of the board. Except as provided in this section 14,
  any member State that so withdraws from the corporation after three or
  more Northeastern States have become member States shall forfeit any money
  or other property such member State has contributed to the corporation,
  including, but not limited to, money or other property contributed to the
  corporation in the form of such member State's initial capital contribution
  and additional capital contributions: Provided, however, That a member State
  that withdraws from the corporation within five years, after becoming a
  member State shall be entitled to receive, as soon as practicable and no
  later than five years after such withdrawal, 50 per centum of any money
  or other property such member State has contributed to the corporation,
  including, but not limited to, money or other property contributed to the
  corporation in the form of such member State's initial capital contribution
  and additional capital contributions.
  (b) If all member States withdraw from the corporation pursuant to this
  section 14, the business of the corporation shall be terminated after the
  payment to the holders of all obligations, all principal of and interest
  on such obligations according to the terms thereof and the payment of all
  amounts owed to other creditors of the corporation. With respect to the
  termination of its business, the corporation shall fulfill or discharge
  its contracts, collect it assets, sell its assets for cash at public or
  private sale, discharge, pay, or otherwise provide for its liabilities,
  including all obligations, and do all other acts appropriate to terminate
  its business. If any assets remain following the discharge, payment, or other
  provision for its liabilities, including all obligations, such assets shall
  be distributed to holders of capital securities issued pursuant to section
  23 of the Act in accordance with the terms of such capital securities,
  and to each Northeastern State that at any time has been a member State,
  substantially in the ratio that the sum of the initial capital contribution
  and additional capital contributions of each such member State (in each
  case, not represented by capital securities) bears to the sum of all such
  initial capital contributions and additional capital contributions, minus
  any sums already received by such Northeastern State upon its earlier
  withdrawal from the corporation pursuant to section 14(a) of the Act.
CHAPTER III--PROJECTS AND PROGRAMS OF THE CORPORATION
PROJECTS AND PROGRAMS OF THE CORPORATION
  SEC. 15. (a) Except as limited by other provisions of the Act, the
  corporation shall have all powers necessary or appropriate to act as a
  participant in any project or program.
  (b) Except as limited by other provisions of the Act, the corporation may
  exercise its powers, either alone or jointly with any person or persons,
  and the corporation may enter into partnerships, joint ventures, or other
  joint or cooperative business arrangement with any person or persons.
  (c) Except as may be limited by sections 17 and 18 of the Act, financial
  participation or investment by the corporation in any project or program
  may consist of equity or debt (secured or unsecured) or any combination
  thereof. Such financial participation or investment shall be made on such
  terms and conditions as the corporation may determine, giving regard (i)
  with respect to any project or program, to the purposes of the corporation,
  and (ii) with respect to any project, to the requirement contained
  in section 16 of the Act that, in the opinion of the corporation, the
  investment in such project, when taken together with all other activities
  and investments of the corporation, is not expected to impair materially
  the credit standing of the corporation or the ability of the corporation
  to fulfill it commitments, whether statutory or contractual or reasonably
  incidential thereto, including liabilities with respect to obligations.
  (d) In addition, and without limitation to the powers conferred upon
  the corporation by other provisions of the Act, the corporation shall
  have power--
  (i) to provide capital, in the form of equity, debt, grant, or otherwise,
  or any combination thereof, to enable any person or persons to undertake
  work in connection with potential projects and programs;
  (ii) to provide technical, legal, and other assistance to any person or
  persons in connection with projects and programs; and
  (iii) to provide for research and development activities related to the
  energy development of the member States in connection with projects and
  programs.
  (e) The determination of whether an activity falls within the definition
  of a `project' or a `program' pursuant to the Act, and the determination
  of whether a `start-up period' exists with respect to any project, shall
  be made by the board, and such determinations shall be conclusive.
FINDINGS REGARDING PROJECTS AND PROGRAMS
  SEC. 16. (a) The corporation shall not become a participant in any project
  unless the board finds, pursuant to a resolution adopted by the board, that--
  (i) such project is expected to have a beneficial impact upon, or relation
  to, the production, conservation, or cost of energy within any one or more
  of the member States in any one or more of the following ways:
  (A) the project is expected to promote increased energy supply or
  conservation, the development of new energy technologies, or to lower the
  cost of energy within any one or more of the member States;
  (B) the project is expected to facilitate the distribution of energy within
  any one or more of the member States;
  (C) the project is expected to promote cooperation among the member States
  with respect to the development of energy-related businesses and facilities;
  (D) the project is expected to promote increased efficiency in the storage
  of energy;
  (E) the project will promote the exploitation of energy sources located
  in or to be used by any one or more of the member States; or
  (F) the project is expected to promote the development or rehabilitation
  of power production facilities within any one or more of the member States;
  (ii) in the opinion of the corporation, the investment in such project,
  when taken together with all other activities and investments of the
  corporation, is not expected to impair materially the credit standing of the
  corporation or the ability of the corporation to fulfill its commitments,
  whether statutory or contractual or reasonably incidental thereto, including
  liabilities with respect to obligations;
  (iii) alternative sources of financing the project at a reasonable cost,
  from the private sector or from other governmental entities, are either
  unavailable or insufficient;
  (iv) the investment in the project, when taken together with all other
  activities of the corporation, both actual and planned, will not reduce the
  percentage of the corporation's investment in conservation or conversion
  from oil use to less than 25 per centum of its total investment in all
  projects and activities; and
  (v) in the event that the corporation will, during the start-up period,
  (A) control (as defined in section 18 of the Act) the project or a
  participant in the project, or (B) contribute more than 50 per centum of
  the capital costs (as defined in section 18 of the Act) of the project,
  provision has been made for equity ownership and operation of the project,
  after completion thereof, by a transferee pursuant to section 19 of the
  Act; or, in the event that the corporation will own, hold in pledge, or
  otherwise control at all times less than 50 per centum of the project, the
  participant with whom the corporation intends to develop the project is a
  participant acceptable to the corporation, applying the criteria set forth
  with respect to a transferee in section 19 of the Act: Provided, however,
  That no such provision need be made if the board, upon the requisite request,
  pursuant to section 18 of the Act, waives the prohibitions against such
  control or contribution of 50 per centum or more of the capital costs of
  the project pursuant to section 18 of the Act.
  (b) The corporation may consider, in its findings concerning projects,
  local and regional goals and policies, as expressed in local and regional
  plans and consultations with elected and appointed officials of the member
  States and municipalities in which projects shall be located.
  (c) The corporation shall not become a participant in any program, the
  aggregate cost of which is projected to exceed $100,000, unless the board
  finds, pursuant to a resolution adopted by the board, that such program
  (i) is expected to have a beneficial impact upon, or relationship to,
  production, conservation, or cost of energy, within any one or more of the
  member States in any one or more of the ways provided for under section
  16(a)(i) of the Act with respect to projects, and (ii) carries out the
  purposes of the corporation.
LIMITATION UPON INVESTMENT IN ANY PROJECT OR PROGRAM
  SEC. 17.  With respect to any project or program, the corporation shall not
  invest, loan, guarantee, or otherwise encumber, directly or indirectly,
  more than the greater of (i) 10 per centum of the corporation's maximum
  borrowing authority, determined pursuant to section 26 of the Act, or
  (ii) $200,000,000.
PROHIBITION AGAINST CONTROL OF ANY PROJECT AFTER THE START-UP PERIOD
  SEC. 18.  Except for investments, ownership, holdings in pledge, or other
  means of control during the start-up period, the corporation shall not
  (a) control any project or any participant in a project, or (b) contribute
  50 per centum or more of the capital costs of a project. Notwithstanding
  the prohibitions contained in the preceding sentence, the board may,
  on the request of the Secretary or two-thirds of the Governors of the
  member States, waive such prohibitions against control or contribution of
  50 per centum or more of the capital costs of a project. For the purposes
  of sections 16, 18, and 19 of the Act, (i) `control' of any project or
  any participant in a project means possession, direct or indirect, of the
  power to direct or cause the direction of the management and policies
  of such project or a participant in such project, whether through the
  ownership of voting securities, by contract, or otherwise; and (ii) for
  the purposes of sections 16, 18, and 19 of the Act, `capital costs' of
  any project means the aggregate of all amounts contributed to a project
  or participant in a project (a) that are evidenced by any instrument
  of indebtedness having a final maturity date later than one year from
  the issuance of such instrument, or (b) that are evidenced by equity
  securities. Notwithstanding the limitations contained in this section
  18, activities of the corporation, after completion of any project, may
  include such supervision of regulation of a project that is necessary to
  protect the corporation's investment in such project and to insure that
  such project continues to serve the public purposes of the corporation.
TRANSFER OF PROJECTS; TRANSFEREE
  SEC. 19. (a) In the event that the corporation shall, during the startup
  period, control (as defined in section 18 of the Act) a project or a
  participant in a project, or contribute 50 per centum or more of the
  capital costs (as defined in section 18 of the Act) of a project, the
  corporation shall have a commitment in form and substance reasonably
  satisfactory to the board from one or more transferees for the transfer,
  for fair and reasonable consideration, upon the successful completion of
  the project, of any proposed interest of the corporation in the project
  or in the participant so that, after the startup period, the corporation
  will not be in violation of section 18 of the Act: Provided, however,
  That no such commitment shall be required if the board, upon the request
  of the Secretary or two-thirds of the Governors of the member States
  pursuant to section 18 of the Act, waives the prohibitions against such
  control or contribution of 50 per centum or more of the capital costs of
  the project. The board, in making such a determination, shall give regard
  to any and all relevant facts, including, but not limited to--
  (i) the transferee's present and projected ability to meet its financial
  obligations; and
  (ii) the transferee's present and projected ability to improve the
  availability of energy or to lower the cost of energy in any one or more
  of the member States.
  (b) The board may, by agreement with the transferee, require such other
  terms, conditions, and undertakings as the board in its discretion may
  determine.
ALLOCATION OF PROJECTS AND PROGRAMS TO MEMBER STATES
  SEC. 20.  The board shall use its best efforts to allocate its resources to
  projects and programs located in or otherwise benefitting each member State
  in substantially the same ratio that the sum of each member State's initial
  capital contribution and additional capital contributions bears to the sum
  of all member States' initial capital contributions and additional capital
  contributions. The corporation shall not, however, be required to maintain
  such allocations at all times, it being recognized that imbalances may
  develop from time to time in the course of the corporation's operations. The
  board shall adopt regulations governing the determination of whether the
  allocation of resources to projects and programs is in subsantially the
  same such ratio. Such regulations shall include--
  (i) provision for periodic review, not less often than every five years,
  of compliance with such regulations;
  (ii) rules for the calculation of the amount of resources of the corporation
  allocated to each member State; and
  (iii) provisions for the reallocation of resources of the corporation to
  correct any periodic imbalances in such proportional allocations.
GUBERNATORIAL REVIEW
  SEC. 21. (a) Before the corporation may commit or expend more than
  $5,000,000 in connection with any project or program, the corporation
  shall file copies of (i) the project or program plan setting forth a
  description of the project or program, and (ii) a summary of the findings
  of the corporation pursuant to section 16 of the Act with the Secretary,
  with each of the Governors, and with the appropriate officials of each of
  the legislatures of the member States.
  (b) The Governor of the member State in which such project or program is to
  be located may, not more than thirty days after such plan and summary are
  so filed, disapprove the project or program by filing a written notice of
  such disapproval at the offices of the corporation, with the Secretary and
  with the Governors and legislatures of all member States. If the Governor
  of the member State in which such project or program is to be located files
  such a notice of disapproval, the corporation shall not be authorized to
  participate further in such project or program.
  (c) If the Governor of the member State in which such project or program
  shall be located shall not file a notice of disapproval within thirty
  days after such plan and summary are so filed, the corporation shall be
  authorized to participate in such project or program.
REGIONAL ENERGY PLANNING
  SEC. 22. (a) The corporation shall actively participate as a regional
  instrumentality in the formulation of the National Energy Policy Plan as
  provided for in title VIII of the Department of Energy Organization Act,
  Public Law 95-91.
  (b) The corporation shall prepare, not later than one year following
  its creation and biennially thereafter, a Regional Energy Plan, which
  shall establish regional energy production, utilization, and conservation
  objectives, for periods of five and ten years, and measures necessary to
  satisfy the projected energy needs of the region. Such Plan shall estimate
  the source and magnitude of the domestic and foreign supplies of energy on
  which the region is expected to rely to meet projected energy needs in an
  economic manner with due regard for the protection of the environment. Such
  Plan shall also identify the strategies that should be followed and the
  resources that should be committed to achieve the objectives set forth,
  forecasting the level of investment necessary in the region for each
  significant supply section and each significant consuming sector, as well
  as the level of investment for each sector that can be achieved by private
  sector financing without the assistance of the Corporation.
  (c) In addition to any findings required by section 16 of this Act or
  otherwise, the corporation shall not authorize an investment in any project
  or program unless it also determines that such investment is consistent
  with the objectives and strategies identified in the most recent effective
  Regional Energy Plan.
  (d) The Regional Energy Plan, as prepared by the corporation and approved
  by the board, shall be submitted to the Governors of each member State. The
  Plan shall become effective for purposes of subsection (c) only if approved
  by the Governor's of all member States.
CHAPTER IV--FINANCING
CAPITAL CONTRIBUTIONS BY MEMBER STATES
  SEC. 23. (a) Not later than twelve months following the date on which a
  Northeastern State makes a subscription for State stock, the corporation
  shall issue such State stock to each such Northeastern State that (i)
  appropriates and pays to the corporation its initial capital contribution
  and (ii) enacts legislation substantially in the form of sections 40 through
  52 of the Act, unless waived by the board pursuant to section 39 of the Act.
  (b) The board may from time to time request additional capital contributions
  from each member State in such amounts and subject to such terms and
  conditions as the board shall determine. No member State shall, however,
  be obligated to make any additional capital contributions to, or purchase
  any securities of, the corporation without such member State's consent. The
  aggregate amount of any such additional capital contributions that shall be
  requested from the member States by the board shall be apportioned among
  the member States in accordance with the respective populations of the
  member States as determined by the most recent decennial census conducted
  by the United States Census Bureau, or as the board may otherwise determine.
  (c) Initial capital contributions and additional capital contributions
  may take such form as the board shall determine.
CAPITAL SECURITIES
  SEC. 24. The corporation is authorized to issue and have outstanding such
  securities representing contributions to the corporation's capital as the
  board may, from time to time, determine. Such capital securities may be
  issued to the member States or to other persons that contribute to the
  capital of or make loans to the corporation, without limitation as to
  number, in one or more classes or series, at such offering prices as the
  board may, in its discretion, from time to time, determine. The board
  shall have authority to fix the number of shares included in each such
  class or series and the variations in the relative rights, preferences,
  and limitations as between classes or series, including those relating to
  voting, dividends, and liquidation. The holders of such capital securities
  shall not, however, have or be granted the right to elect more than two
  outside directors. Holders of any capital securities shall have the right
  to examine, in person, or by agent or attorney, at any reasonable time
  or times, for any proper purpose, the corporation's record of holders of
  such capital securities and to make extracts therefrom. Contributions from
  member States to the capital of the corporation pursuant to this section
  23 may take such form as the board shall determine.
ISSUANCE OF OBLIGATIONS
  SEC. 25. (a)(i) The corporation shall have the power to issue obligations,
  from time to time, whether or not such obligations are guaranteed
  obligations, in such principal amounts as the corporation shall determine
  to be necessary, within the limits of its authorized indebtedness as
  prescribed in section 26 of the Act, to provide sufficient funds for
  carrying out any of the corporation's purposes, including the making of
  payments of interest on obligations, the establishment of reserves to
  secure obligations and the making of all other expenditures incident to,
  or necessary or convenient for, carrying out its corporate purposes.
  (ii) The corporation shall have the power to issue, from time to time,
  obligations to renew, refund, or pay other obligations, regardless of
  class or designation, including interest thereon, in whole or in part,
  whether or not the obligations to be renewed, refunded, or paid have
  matured. Obligations that are issued to renew, refund, or pay other
  obligations may be exchanged for the obligations to be renewed, refunded,
  or paid, or may be sold and the proceeds thereof applied to the purchase,
  redemption, or payment of such obligations to be renewed, refunded, or paid.
  (iii) Every issue of obligations shall be general obligations of the
  corporation payable out of any revenues of the corporation, subject only
  to any agreements with the  United States or the holders of particular
  obligations pledging or granting a security interest in any particular
  revenues of the corporation. Subject to any agreement with the  United
  States pursuant to section 28 of the Act or otherwise, or with the holders of
  obligations, the corporation may determine that any issue of obligations may
  be payable solely out of and secured by the revenues from the operation,
  lease, mortgage, or sale by the corporation of any of its projects or
  programs all as may be designated in the resolution of the corporation
  pursuant to which such obligations are authorized to be issued.
  (iv) Obligations shall be authorized to be issued by resolution of
  the corporation, shall bear such date, and shall mature at such time or
  times as such resolution may provide. Obligations may be issued as serial
  obligations or as term obligations or as a combination thereof. Obligations
  shall bear interest at such rate or rates, be in such denominations and in
  such form, either coupon or registered, carry such registration privileges,
  be executed in such manner, be payable in such medium of payment, at
  such place or places, and be subject to such terms of redemption as such
  resolution may provide.
  (v) Obligations may be sold at such price, or prices, at public or private
  sale, in such manner and from time to time as the corporation may determine,
  and the corporation may pay all expenses, premiums, and commissions that
  it deems necessary or advantageous in connection with the issuance and
  sale thereof.
  (b) Any resolution authorizing any obligations or any issue thereof may,
  subject to the provisions of any other resolution or other agreement with
  the  United States or with the holders of obligations, contain provisions
  that shall be a part of the contract with the holders thereof as to--
  (i) the pledging of, or the granting of security interests in, all or
  any part of the revenues of the corporation, including those that may
  be acquired by the corporation after such pledge or grant, to secure the
  payment of obligations or of any issue thereof;
  (ii) the pledging of, or the granting of security interests in, all or
  any part of the assets of the corporation, including those that may be
  acquired by the corporation after such pledge or grant, to secure the
  payment of obligations or of any issue thereof;
  (iii) the pledging of, or the granting of security interests in, any or
  all rents, fees, tolls, or other amounts collected, or to be collected, by
  the corporation to secure the payment of obligations or of any issue thereof;
  (iv) the setting aside of reserves, or sinking funds and the regulation
  and disposition thereof;
  (v) limitations on the purposes to which proceeds of the sale of obligations
  may be applied, including the pledging of, or the granting of security
  interests in, such proceeds to secure the payment of obligations or any
  issue thereof;
  (vi) limitations on the issuance of additional obligations, the terms upon
  which additional obligations may be issued and secured and the refunding
  of outstanding or other obligations;
  (vii) the procedure, if any, by which the terms of any contract with holders
  of obligations may be amended, the amount of obligations the holders of which
  must consent thereto, and the manner in which such consent may be given;
  (viii) transferring to, or vesting in, a trustee or trustees such property,
  rights, powers, and duties in trust as the corporation may determine;
  (ix) the acts or omissions to act that shall constitute a default in the
  obligations and duties of the corporation to the holders of obligations, and
  provision for the rights and remedies of the holders of obligations in the
  event of such default, including the right to appointment of a receiver; and
  (x) any other matters that may affect the security or protection of the
  holders of obligations.
  (c) Any pledge or other security interest made or granted by the
  corporation shall be valid and binding from the time when such pledge or
  other security interest is made or granted. The revenues or other property
  so pledged or otherwise secured and thereafter received by the corporation
  shall immediately be subject to the lien of such pledge or other security
  interest without any physical delivery thereof or further act, and the lien
  of any such pledge or other security interest shall be valid and binding
  as against all parties having claims of any kind in tort, contract, or
  otherwise, against the corporation irrespective of whether such parties
  have notice or knowledge thereof, and any such pledge or other security
  interest shall have any and all rights and priorities of a perfected security
  interest. Neither the resolution nor any other instrument by which such
  pledge or other security interest is made or granted need be recorded or
  filed for such pledge or other security interest to be effective, except
  at the principal office of the corporation.
  (d) Neither the directors nor any other person executing obligations shall
  be subject to any personal liability or accountability by reason of the
  issuance thereof.
  (e) The corporation, subject to the provisions of any resolution or
  other agreement with the United States or the holders of obligations,
  is authorized to purchase obligations out of any funds available therefor.
  (f) In the discretion of the directors, obligations may be secured by a trust
  indenture by and between the corporation and a trustee, which may be any
  trust company or bank having the powers of a trust company in any member
  State. Such trust indenture may contain such provisions for protecting
  and enforcing the rights and remedies of the holders of obligations as
  may be reasonable and proper not in violation of law, including covenants
  setting forth the duties of the corporation in relation to the exercise
  of its corporate powers, and the corporation may provide by such trust
  indenture for the payment of the proceeds of the sale of obligations and
  the revenues of the corporation to the trustee under such trust indenture,
  or to another depository, and for the method of disbursement thereof, with
  such safeguards and restrictions as the corporation may determine. All
  expenses incurred in carrying out such trust indenture may be treated as
  a part of the operating expenses of the corporation.
  (g) All obligations are hereby made negotiable instruments, subject only
  to any provisions for registration of ownership of obligations.
  (h) If a director or office of the corporation whose signature appears
  on obligations or coupons thereto shall cease to be a director or officer
  before the delivery of such obligations or coupons thereto, such signature
  shall nevertheless, be valid and sufficient for all purposes, as if such
  director had remained in office until such delivery.
MONEYS OF THE CORPORATION
  SEC. 26. (a) All moneys of the corporation from whatever source derived
  may be paid to the chief financial officer of the corporation, or to such
  other person as the corporation may direct, and be deposited forthwith
  in a bank or banks in any one or more of the member States or in the
  District of Columbia, as designated by the corporation. All such moneys
  may be paid by the chief financial officer of the corporation or by such
  other person as the corporation may authorize. All deposits of such moneys
  may, if required by the corporation, be secured in the manner and amount
  required by the corporation, and all banks and trust companies organized
  under the laws of the United States are authorized to give such security
  for such deposits. Such obligations may either be deposited with the chief
  financial officer of the corporation or be held by a trustee or agent
  satisfactory to the corporation. Such persons as may from time to time be
  designated by the General Accounting Office, or by the Governors of the
  member States, or their duly authorized representatives, are authorized
  and empowered from time to time to examine the accounts and books of
  the corporation, including revenues, disbursements, contracts, leases,
  sinking funds, investments, and any other records and papers relating to
  the corporation's financial standing.
  (b) Subject to the provisions of this section 25, any moneys of the
  corporation, including the proceeds of the sale of obligations, not required
  for immediate use by the corporation, may be invested in obligations of
  the United States or obligations the principal of and interest on which
  are guaranteed by the United States, or in secured time deposit or other
  interest-bearing accounts secured by such obligations. No moneys of the
  corporation may be invested in any obligations of any member State or of
  any instrumentality or political subdivision thereof: Provided, however
  That the corporation may so invest in obligations of a member State or of
  any instrumentality or political subdivision thereof if such investment
  otherwise is within the purposes and limitations of the Act, including,
  without limitation, those limitations set forth in sections 16, 17, and
  18 of the Act.
  (c) The corporation shall have power to contract with the United States
  or the holders of any obligations as to the custody, collection, securing,
  investment, and payment of any moneys of the corporation, and of any moneys
  held in trust or otherwise for the payment of obligations, and to carry
  out such contract. Moneys held in trust or otherwise for the payment of
  obligations or in any way to secure obligations, and deposits of such
  moneys, may be secured in the same manner as moneys of the corportion,
  and all banks and trust companies organized under the laws of the United
  States are authorized to give such security for such deposits.
  (d) The corporation (i) may create and establish one or more debt service
  funds, from which it may pay principal of and interest on outstanding
  obligations, and one or more operating funds, from which it may pay the
  expenses of exercising any and all powers, duties, and functions authorized
  by the Act, and (ii) may create and establish such other funds as may be
  necessary or desirable to carry out the purposes of the corporation.
AUTHORIZED INDEBTEDNESS
  SEC. 27. (a) Subject to the provisions of any resolution or other agreement
  with the United States or the holders of obligations, the corporation
  shall not permit obligations to be outstanding at any time in an aggregate
  principal amount exceeding fifteen times the total capital subscriptions
  at such time: Provided, however, That any obligations theretofore renewed,
  refunded, or paid by the corporation shall be excluded from total capital
  subscriptions for the purposes of this calculation.
  (b) No obligation shall mature more than forty years from the date on
  which the corporation issues such obligation.
SECURITY FOR OBLIGATIONS
  SEC. 28. (a) Subject to the provisions of any resolution or other agreement
  with holders of obligations, the principal of and interest on any obligations
  may be secured by a pledge of or other security interest in all or any
  part of the revenues or assets of the corporation, and may be secured by
  all or any part of any one or more projects, including all or any part
  of any additions, improvements, extensions to, or enlargements of such
  projects, and such revenues, assets, or projects acquired or developed by
  the corporation after such pledge or grant of a security interest.
  (b) Subject to the provisions of any resolution or other agreement with
  the United States or the holders of obligations, obligations issued for the
  acquisition, construction, reconstruction, rehabilitation, or improvement
  of any one or more projects or any other property of the corporation may
  also be secured by an assignment of leases of or mortgages on such projects
  or other property of the corporation and by an assignment of the revenues
  derived by the corporation from such leases or mortgages.
  (c) The resolution pursuant to which obligations are authorized to be issued
  and any such lease, mortgage, or other instrument may contain agreements and
  provisions respecting the maintenance of the projects or other property of
  the corporation covered thereby, the fixing and collection of rents, tolls,
  fees, or other amounts therefrom, including moneys received in repayments of
  mortgage loans, and interest thereon, the creation and maintenance of special
  funds from such rents, tolls, fees, or other revenues, and the rights and
  remedies available in the event of default, as the corporation may determine.
  (d) Each pledge, mortgage, or other instrument made to secure the payment
  of principal of and interest on any obligations shall continue in effect
  until the principal of and interest on such obligations shall have been
  fully paid, or until adequate provisions shall have been made for such
  payment in the manner provided in the resolutions pursuant to which such
  obligations were authorized to be issued.
  (e) The corporation may provide in any resolution pursuant to which
  obligations are authorized to be issued that all or any part of any
  project may be constructed, reconstructed, rehabilitated, or improved by
  the corporation, or by any lessee or designee of the corporation, and may
  also provide in such resolution for the time, manner of and requisites
  for payments in connection with such construction, reconstruction,
  rehabilitation, or improvements, and for all certificates and approvals
  in connection with such construction, reconstruction, rehabilitation,
  or improvement, and payments therefor, as the corporation may determine.
  (f) Any resolution pursuant to which obligations are authorized to be
  issued and any trust indenture established thereby may contain provisions
  for translating to or vesting in a trustee or trustees such property,
  rights, powers, and duties in trust as the Corporation may determine,
  including any and all rights, powers, and duties of the trustee appointed
  by the holders of any issue of obligations pursuant to section 30 of the
  Act, in which event the provisions of section 30 of the Act authorizing
  the appointment of a trustee by such holders or obligations shall not apply.
POWER TO ENTER AGREEMENTS WITH THE UNITED STATES
  SEC. 29. In connection with any resolution pursuant to which guaranteed
  obligations are authorized to be issued, the corporation may agree with
  the United States to--
  (a) pledge all or any part of the assets or revenues of the corporation
  to secure the payment of principal of and interest on such guaranteed
  obligations;
  (b) set aside and regulate reserves or sinking funds;
  (c) limit the issuance of additional obligations;
  (d) provide for any rights of subrogation of the United States to the
  rights of holders or guaranteed obligations;
  (e) transfer to or vest in a trustee or trustees such property, rights,
  powers, and duties in trust as the corporation may determine;
  (f) specify the acts or omissions to act that shall constitute a default
  in the obligations and duties of the corporation to the United States or
  to the holders of guaranteed obligations, and provide for the rights and
  remedies of the holders of guaranteed obligations in the event of such
  default, including the right to appoint a receiver; and
  (g) provide for any other matters that may affect the security or protection
  of the holders of guaranteed obligations.
CONSENT OF UNITED STATES OR MEMBER STATES NOT NECESSARY FOR ISSUANCE OR
OBLIGATIONS
  SEC. 30. Obligations may be issued without obtaining the consent of any
  official, department, division, commission, board, body, bureau, or agency
  of the United States or any member State, and without any other proceedings
  or the happening of any conditions or things other than those proceeding,
  conditions, or things specifically required by the Act, and by the provisions
  of the resolution pursuant to which obligations are authorized to be issued
  or of any guarantee of the United States under the Act: Provided, however,
  That the offer and sale of obligations shall be subject to any applicable
  securities laws of the United States and of the member States.
REMEDIES OF HOLDERS OF OBLIGATIONS
  SEC. 31. (a) In the event that the corporation shall default in the payment
  of principal of, or interest on, or sinking fund payment on any issue of
  obligations after such principal, interest, or sinking fund payment shall
  become due, whether at maturity or otherwise, or in the event that the
  corporation shall default in any agreement with the holders of any issue of
  obligations, and except as provided with respect to guaranteed obligations,
  the holders of 25 per centum in aggregate principal amount of the obligations
  of such issue then outstanding, by instrument or instruments filed in the
  office of the clerk of the county or comparable official in any member
  State in which the corporation has an office and proved or acknowledged
  in the same manner as a deed to be recorded, may appoint a trustee to
  represent the holders of obligations for the purposes herein provided.
  (b) Such trustee may, and upon written request of the holders of 25 per
  centum in aggregate principal amount of such obligations then outstanding
  shall, in such trustee's own name--
  (i) by suit, action, or proceeding in accordance with local law, enforce
  all rights of the holders of such obligations, including the right to
  require the corporation to carry out any agreement with holders of such
  obligations and to perform its duties under the Act;
  (ii) bring suit upon such obligations;
  (iii) by action or suit, require the corporation to account as if the
  corporation were the trustee of an express trust for the holders of such
  obligations;
  (iv) by action or suit, enjoin any violation of the rights of the holders
  of such obligations; and
  (v) declare all such obligations due and payable, and if all defaults shall
  be made good, then, with the consent of the holders of 25 per centum in
  aggregate principal amount of such obligations then outstanding, annul
  such declaration and its consequences; except that before declaring the
  principal of such obligations due and payable, the trustee shall first
  give thirty days' notice in writing to the Secretary, the Governors of
  all member States and the corporation.
CREDIT OF UNITED STATES NOT PLEDGED
  SEC. 32.  Except as provided with respect to guaranteed obligations,
  obligations shall not constitute a debt, liability, or other obligation
  of the  United States, and obligations shall not constitute a pledge, a
  guarantee, or any other promise of the faith and credit or of the taxing
  power of the  United States. Except as provided with respect to guaranteed
  obligations, obligations shall be payable solely from the revenues and
  other assets of the corporation. All obligations must contain a statement
  to such effect conspicuously on the face thereof.
CHAPTER V--GUARANTEE OF OBLIGATIONS
AUTHORIZATION OF SECRETARY TO GUARANTEE OBLIGATIONS
  SEC. 33. (a) The Secretary is authorized to guarantee, in the manner and
  subject to the terms and provisions contained in the Act, the obligations
  of the corporation and to enter into agreements with respect thereto.
  (b) The full faith and credit of the  United States is pledged to the payment
  of all guarantees made pursuant to the Act with respect to principal of
  and interest on guaranteed obligations, including interest accruing between
  the date of default on a guaranteed obligation and the payment in full of
  any amounts owed by the  United States pursuant to the guarantee.
  (c) Any guarantee made by the Secretary pursuant to the Act shall be
  conclusive evidence of the eligibility of the guaranteed obligations
  for such guarantee, and the validity of any guarantee so made shall be
  incontestable in the hands of a holder of a guaranteed obligation.
  (d) The maximum aggregate principal amount of outstanding guaranteed
  obligations at any one time shall not exceed $25,000,000,000 multiplied by a
  fraction, the numerator of which is the aggregate population of the member
  States and the denominator of which is the total population of the  United
  States, both as determined by the most recent decennial census conducted by
  the  United States Census Bureau: Provided, however, That no reduction in
  population shall affect any guarantees on outstanding guaranteed obligations.
  (e) The corporation shall pay to the  United States such fees as the
  Secretary estimates to be necessary to cover the administrative expenses
  pertaining to guarantees made under the Act: Provided, however, That the
  aggregate of such fees shall not exceed one-quarter of 1 per centum of the
  aggregate principal amount of guaranteed obligations. Such fees shall be
  deposited in the administrative expense fund created pursuant to section
  35 of the Act.
TERMS OF GUARANTEED OBLIGATIONS
  SEC. 34. (a) The Secretary shall take such steps as he considers reasonable
  to assure that guaranteed obligations will--
  (i) bear interest at a rate satisfactory to the Secretary;
  (ii) contain or be subject to maturity, sinking fund, or other repayment
  provisions satisfactory to the Secretary;
  (iii) be sold by the corporation at a price, which need not be par or face
  value, satisfactory to the Secretary; and
  (iv) contain or be subject to security provisions with respect to the
  protection of the interests of the  United States as the Secretary deems
  appropriate: Provided, however, That the Secretary shall consider, with
  respect to such security provisions, the public purposes of the Act and
  the special problems involved in financing projects and programs that
  carry out the purposes of the corporation.
  (b) No guarantee of any obligations of the corporation shall be made pursuant
  to the Act unless the board certifies in writing to the Secretary at or
  prior to the time of the issuance of such guaranteed obligations that,
  with respect to any and all activities undertaken or to be undertaken by
  the corporation with the proceeds of such guaranteed obligations, each of
  the findings contained in section 16 of the Act have been made.
ADMINISTRATIVE EXPENSE AND LOAN GUARANTEE FUNDS
  SEC. 35. (a) There is established in the Treasury of the  United States
  an administrative expense fund to be administered by the Secretary. The
  administrative expense fund shall be used to provide for the payment of
  the amounts payable as administrative expenses with respect to guaranteed
  obligations. All fees paid to the  United States by the corporation to cover
  such expenses pursuant to section 33(e) of the Act shall be deposited in
  the administrative expense fund. The Secretary may also establish in the
  Treasury of the  United States one or more loan guarantee funds, to be
  used for the timely payment of the amounts due to holders of guaranteed
  obligations after default, as provided in section 36 of the Act. Moneys in
  such funds not needed for current operations may be invested in securities
  of, or guaranteed by, the  United States other than guaranteed obligations.
  (b) There are authorized to be appropriated from time to time to any loan
  guarantee fund established pursuant to section 34(a) of the Act such amounts
  as may be necessary to discharge the responsibilities of the Secretary
  with regard to guaranteed obligations. If there are insufficient moneys in
  the administrative expense fund or in any loan guarantee fund established
  pursuant to section 34(a) of the Act to pay the amounts referred to in
  section 34(a) of the Act, the Secretary shall transfer to such fund or
  funds such sums as may be necessary to pay such amounts. The Secretary
  may use, for the purpose of making any such transfers, the proceeds from
  the sale of any securities issued pursuant to the Second Liberty Bond Act;
  and the purposes for which securities may be issued pursuant to the Second
  Liberty Bond Act are hereby extended to include such transfers. There
  are authorized to be  appropriated to the Secretary such sums as may be
  necessary to repay such transfers.
  (c) The Secretary shall report to the Congress within ninety days following
  the end of each fiscal year on the financial condition and operations as of
  the end of such fiscal year, of the administrative expense fund, and of any
  loan guarantee fund established pursuant to section 34(a) of the Act, and
  on the anticipated condition and operations of the administrative expense
  fund and of any loan guarantee fund established pursuant to section 34(a)
  of the Act, during the current fiscal year.
  (d) The General Accounting Office, under such rules and regulations as may be
  prescribed by the Comptroller General of the  United States, may audit (i)
  the administrative expense fund and any loan guarantee fund established
  pursuant to section 34(a) of the Act, and (ii) the corporation. The
  representatives of the General Accounting Office shall have access
  to all books, accounts, records, reports, files, and any other papers,
  things, or property belonging to, or in use by, or in connection with, the
  financial transactions of (i) the administrative expense fund and any loan
  guarantee fund established pursuant to section 34(a) of the Act, and (ii)
  the corporation. Such representatives shall be afforded full facilities for
  verifying transactions with the balances or securities held by depositors,
  fiscal agents, and custodians.
DEFAULT ON GUARANTEED OBLIGATIONS
  SEC. 36. (a) If there is a default by the corporation in the due and punctual
  payment of principal of or interest on any guaranteed obligation, and if such
  default continues for thirty days, the holder of such guaranteed obligation
  or his agent may, and shall have the right, at any time after the expiration
  of such thirty-day period, to demand payment by the Secretary of the unpaid
  principal of and interest on such guaranteed obligation, consistent with
  the terms of the guarantee of such obligation. Such payment may be demanded
  at any time after the expiration of thirty days after default. Not later
  than sixty days from the date of such demand, the Secretary must pay such
  holder the unpaid principal of and interest on such guaranteed obligation,
  consistent with the terms of the guarantee of such obligation and subject
  to such rules and regulations as the Secretary may prescribe.
  (b)(i) The Secretary shall prescribe such rules and regulations as may
  be necessary to enforce any rights granted to him by law or agreement,
  including rights of subrogation to all the rights of holders of guaranteed
  obligations, upon the payment of any amounts referred to in this section 35.
  (ii) In exercising any of the rights referred to in this section 35(b),
  the Secretary shall consider the public purposes of the Act and the special
  problems involved in financing activities that are necessary to carry out
  the purposes of the corporation.
  (c) If the Secretary, through enforcement of the rights granted to him
  by law or agreement, receives from the sale or transfer of property or
  revenues, an amount greater than the amount paid to the holder of guaranteed
  obligations pursuant to section 35(a) of the Act, the Secretary shall pay
  such excess to the corporation.
GUARANTEED OBLIGATIONS NOT TAX EXEMPT
  SEC. 37. Guaranteed obligations shall be treated as obligations not
  described in section 103(a) of the Internal Revenue Code of 1954, as amended.
PURCHASE OF GUARANTEED OBLIGATIONS BY THE UNITED STATES PROHIBITED
  SEC. 38. The purchase by the United States of guaranteed obligations shall
  be prohibited.
OTHER FINANCIAL ASSISTANCE TO THE CORPORATION
  SEC. 39. The Secretary is authorized to enter into agreements on behalf
  of the United States, in addition to those with respect to guaranteed
  obligations, to carry out the purposes of the corporation. Such agreements
  may include, but shall not be limited to, agreements by the United States to
  purchase or to pay for the output or production from projects or programs
  or from participants therein. Unless the corporation otherwise provides,
  such agreements shall not affect guaranteed obligations outstanding at
  the time of such agreements, and shall not reduce the maximum aggregate
  principal amount of guaranteed obligations as determined pursuant to
  section 32 of the Act.
CHAPTER VI--STATE LEGISLATION
STATE LEGISLATION REQUIRED
  SEC. 40. In addition to subscribing for State stock and making an initial
  capital contribution to the corporation pursuant to section 22 of the Act,
  each Northeastern State shall, as a condition of becoming a member State,
  enact legislation substantially in the form of sections 40 through 52 of
  the Act, unless the board shall waive such condition for such Northeastern
  State with respect to all or any part of sections 40 through 52 of the Act.
EXEMPTION FROM TAXATION
  SEC. 41. (a) It is hereby determined that the creation of the corporation
  and the carrying out of its corporate purposes constitute in all respects
  a public and governmental purpose for the benefit of the people of this
  State and for the improvement of their health, safety, welfare, comfort, and
  security, and that the purposes of the corporation are public purposes and
  that the corporation will be performing an essential governmental function
  in the exercise of the powers conferred upon the corporation by the Act.
  (b) The property of the corporation and its income and operations shall
  be exempt from taxation by this State and its political subdivisions.
  (c) Obligations and the income therefrom and all fees, charges, gifts,
  grants, revenues, receipts, and other moneys received or to be received,
  pledged to pay, or secure the payment of, obligations shall at all times
  be free from taxation by this State and its policital subdivisions, except
  for estate and gift taxes and taxes on transfers.
  (d) This State or any instrumentality or political subdivision of this
  State is authorized, in its discretion, to enter into voluntary agreements
  with the corporation pursuant to which the corporation may pay this State
  or any instrumentality or political subdivision of this State such amount
  or amounts, at such time or times and on such terms and conditions as
  the parties thereto shall agree, in lieu of taxes and other assessments
  on the corporation's property that this State or any instrumentality or
  political subdivision of this State might otherwise have collected but
  for the application of section 40(b) to such property of the corporation.
CONDEMNATION AND EMINENT DOMAIN
  SEC. 42. (a) Upon receipt of a request from the corporation pursuant to
  section 8 of the Act that this State exercise its powers of condemnation,
  eminent domain, or other such similar powers as this State shall lawfully
  possess, together with such supporting documentation as this State may
  reasonably request, this State shall act upon such request to acquire such
  real property for the corporation and to convey such real property to the
  corporation. The corporation shall pay or reimburse this State for all
  reasonable cost and expenses of any action taken by this State herein.
  (b) Notwithstanding any other statute of this State, no award of compensation
  that results from the exercise of such power of condemnation, eminent domain,
  or other such similar powers may be increased to reflect any increase
  in the value of such real property caused by the actual or contemplated
  acquisition, use or disposition by the corporation of such real property
  in carrying out the purposes of the corporation.
PERMITS; TIME LIMIT FOR REVIEW; EXEMPTIONS
  SEC. 43. (a) If and to the extent that the implementation of any project
  or program any license, permit, exemption, waiver, or other approval
  (collectively `permits') of or from any officers, departments, agencies,
  bureaus, boards, or commissions of this State, or any instrumentality or
  political subdivision of this State (the `issuing agency'), the issuing
  agency shall promptly review any application or other request therefor. If
  the issuing agency shall require the person, including the corporation,
  making such application or other request to submit any additional
  information the issuing agency considers necessary to complete action
  on such application or request, the issuing agency shall so notify such
  person within thirty days after the filing of such application or other
  request. If the issuing agency requires such additional information, the
  application or request shall be deemed complete when the issuing agency
  receives such required additional information.
  (b) Notwithstanding any other law, rule, or regulation of this State,
  of its instrumentalities and political subdivisions and of any issuing
  agency, an issuing agency shall approve, condition, or disapprove such
  an application or other request within ninety days after such application
  or other request has been filed, or sixty days after such application or
  other request has been deemed complete, whichever is longer. If the issuing
  agency fails to approve, condition, or disapprove such application or other
  request in the time so specified, such application or other request shall
  be deemed to have been approved.
  (c) The Governor of this State shall, within ninety days after the State
  becomes a member State, submit to the corporation a list of permits of
  any issuing agency of this State or of any instrumentalities or potential
  subdivisions of this State to which subsections (a) and (b) herein shall
  not apply, and thereafter subsections (a) and (b) herein shall not apply
  to such permits of such issuing agencies.
ASSISTANCE BY DEPARTMENTS
  SEC. 44. Upon the request of the corporation, any of the various officers,
  departments, agencies, bureaus, boards, and commissions of this State
  or any instrumentalities or political subdivisions of this State (the
  `departments') are authorized to provide technical, administrative, and
  other services to the corporation consistent with a department's normal
  functions and within the limits of available  appropriations, to cooperate
  with the corporation in carrying out the purposes of the corporation
  and to transfer to the corporation, at the corporation's expense, such
  officers and employees as the departments and the corporation may deem
  necessary to assist the corporation in carrying out the purposes of the
  corporation. Officers and employees of this State transferred pursuant to
  this section 43 shall not lose or forfeit their pension, seniority, civil
  service status, or other employment rights as a consequence of such transfer.
OBLIGATIONS AS LEGAL INVESTMENTS
  SEC. 45. Obligations are hereby made securities in which any public
  officers and bodies of this State and any instrumentalities or political
  subdivisions and public corporations of this State, all insurance companies,
  insurance associations, persons carrying on an insurance business, banks,
  trust companies, savings banks, and savings associations, including savings
  and loan associations, building and loan associations, investment companies,
  other persons carrying on any like business, all administrators, guardians,
  executors, trustees, and other fiduciaries, and all other persons whatsoever
  that are now or may hereafter be authorized to invest in bonds, notes, or
  other obligations of this State, may properly and legally invest funds,
  including capital, in their control or belonging to them. Obligations
  are also hereby made securities that may also be deposited with and
  may be received by any public officers and bodies of this State and any
  instrumentalities or political subdivisions and public  corporations of
  this State for any purpose for which the deposit of bonds, notes, or other
  obligations of this State is now or may hereafter be authorized.
MONEYS OF THE  CORPORATION
  SEC. 46. All banks and trust companies organized under the laws of this
  State are authorized to give security for all deposits of moneys of the
  corporation from whatever source derived.
INCONSISTENT PROVISIONS OF OTHER LAWS SUPERSEDED
  SEC. 47. Insofar as the provisions of the Act are inconsistent with the
  provisions of any law of this State, general, special, or local, the
  provisions of the Act shall be controlling.
CREDIT OF THE STATE NOT PLEDGED
  SEC. 48. Obligations shall not constitute a debt, liability, or other
  obligation of this State, and obligations shall not constitute a pledge,
  a guarantee, or any other promise of the faith and credit or of the taxing
  power of this State. All obligations may contain a statement to such effect
  conspicuously on the face thereof.
JURISDICTION OF COURTS
  SEC. 49. Any court of plenary jurisdiction in this State shall have
  jurisdiction of any suit, action, or proceeding by a trustee appointed
  pursuant to section 30 of the Act on behalf of the holders of obligations.
CONSENT OF THE STATE NOT NECESSARY FOR ISSUANCE OF OBLIGATIONS
  SEC. 50. Obligations may be issued without obtaining the consent of
  any official, department, division, commission, board, body, bureau, or
  agency of this State, and without any other proceedings or the happening
  of any conditions or things other than those proceedings, conditions,
  or things specifically required by the Act and by the provisions of the
  resolution pursuant to which obligations are authorized to be issued or
  of any guarantee of the  United States under the Act: Provided, however,
  That the offer and sale of obligations shall be subject to the applicable
  securities laws of this State.
CONSTRUCTION
  SEC. 51. Sections 40 through 52 of the Act shall be liberally construed
  to effect the purposes of sections 40 through 52 of the Act.
SEPARABILITY
  SEC. 52. If any part of sections 40 through 52 of the Act shall be
  adjudged invalid by any court of competent jurisdiction, such judgment
  shall not affect any other part of sections 40 through 52 of the Act,
  unless inseparable from the part of sections 40 through 52 of the Act
  adjudged invalid, but shall be confined in its operations to that part of
  sections 40 through 52 of the Act directly involved in the controversy in
  which such judgment shall have been rendered.
EFFECTIVE DATE
  SEC. 53. Sections 40 through 52 of the Act shall take effect when three
  or more Northeastern States shall become member States.
CHAPTER VII--MISCELLANEOUS
CONSTRUCTION
  SEC. 54. The Act shall be liberally construed to effect the purposes of
  the Act.
SEPARABILITY
  SEC. 55. If any part of the Act shall be adjudged invalid by any court
  of competent jurisdiction, such judgment shall not affect any other part
  of the Act, unless inseparable from the part of the Act adjudged invalid,
  but shall be confined in its operations to that part of the Act directly
  involved in the controversy in which such judgment shall have been rendered.