§53723. Payments by Secretary and issuance of obligations

(a) Cash Payment.-Amounts required to be paid by the Secretary under section 53721 or 53722 of this title shall be paid in cash.

(b) Issuance of Obligations.-If amounts in the appropriate account under section 53717 of this title are not sufficient to make a payment required under section 53721 or 53722 of this title, the Secretary may issue obligations to the Secretary of the Treasury. The Secretary, with the approval of the Secretary of the Treasury, shall prescribe the form, denomination, maturity, and other terms (except the interest rate) of the obligations. The Secretary of the Treasury shall set the interest rate for the obligations, considering the current average market yield on outstanding marketable obligations of the United States Government of comparable maturities during the month before the obligations are issued.

(c) Purchase of Obligations.-The Secretary of the Treasury shall purchase the obligations issued under this section. To purchase the obligations, the Secretary of the Treasury may use as a public debt transaction the proceeds from the sale of securities issued under chapter 31 of title 31. The purposes for which securities may be issued under that chapter are extended to include the purchase of obligations under this subsection. The Secretary of the Treasury may sell obligations purchased under this section. A redemption, purchase, or sale of the obligations by the Secretary of the Treasury is a public debt transaction of the Government.

(d) Deposits and Redemptions.-The Secretary shall deposit amounts borrowed under this section in the appropriate account under section 53717 of this title and make redemptions of the obligations from that account.

( Pub. L. 109–304, §8(c), Oct. 6, 2006, 120 Stat. 1618 ; Pub. L. 109–163, div. C, title XXXV, §3507(a)(1)(G), Jan. 6, 2006, 119 Stat. 3555 .)

Amendment Not Shown in Text

This section was derived from section 1275(d) of the former Appendix to this title, which was amended by Pub. L. 109–163, div. C, title XXXV, §3507(a)(1)(G), Jan. 6, 2006, 119 Stat. 3555 . For applicability of that amendment to this section, see section 18(a) of Pub. L. 109–304, set out as a Legislative Purpose and Construction note preceding section 101 of this title. Section 1275(d) of the former Appendix to this title was amended by striking "Secretary" the first, second, third, fifth, and last places it appears and inserting "Secretary or Administrator".

In subsections (b) and (d), the words "appropriate account under section 53717 of this title" are substituted for "Federal Ship Financing Fund" because the accounts under section 53717 replace the Federal Ship Financing Fund. See the explanation for section 53717.