Summary
# FEDERAL EMPLOYEES CIVIL RELIEF ACT (S. 640)
## WHAT THIS BILL DOES
This bill temporarily stops certain legal actions and debt collection against federal workers during government shutdowns or when the national debt exceeds its legal limit. The bill protects federal workers from evictions, foreclosures, student loan defaults, and other civil lawsuits for up to 30 days after a shutdown ends.
## WHO IT AFFECTS
- Federal employees (workers employed by any federal agency or department)
- Employees of private contractors who work for federal agencies
- Landlords and lenders who seek to collect debts from federal workers
- Dependents of federal workers affected by the worker's shutdown
## KEY PROVISIONS
- Federal workers who are furloughed or work without pay may ask a court to delay or suspend payments on rent, mortgages, taxes, fines, insurance premiums, student loans, and other civil debts (Sec. 5)
- Landlords cannot evict federal workers from their homes during a shutdown without a court order, and courts may pause eviction cases for up to 30 days or adjust payment terms (Sec. 6)
- Courts may pause mortgage foreclosure cases and adjust mortgage payments if a shutdown materially affects a worker's ability to pay (Sec. 7)
- Lenders cannot place student loans in default or report missed payments to credit agencies without a court order during a shutdown (Sec. 9)
- Federal income tax collection can be delayed for up to 90 days after a shutdown ends, with no added interest or penalties during the delay (Sec. 10)
- Insurance policies cannot be canceled solely because a federal worker misses a premium payment during a shutdown (Sec. 11)
- Using these protections cannot be used against federal workers in future credit decisions, loan applications, or insurance determinations (Sec. 12)
- The Attorney General can sue anyone who violates this law, and affected workers can file private lawsuits for damages (Sec. 13)
## WHAT CHANGES
If this becomes law, federal workers gain temporary legal protections during shutdowns that prevent creditors and landlords from taking collection actions. Courts gain authority to pause or adjust payment obligations. People who violate these protections face criminal penalties (fines or up to one year in prison) and civil lawsuits. Federal workers can no longer be penalized by lenders or insurers simply for requesting shutdown relief.
## IMPORTANT DEFINITIONS
**Shutdown**: Any period lasting more than 24 hours when the government runs out of money to pay agencies because Congress hasn't passed a budget, or when the national debt exceeds its legal borrowing limit (Sec. 3)
**Covered period**: The time from when a shutdown begins through 30 days after it ends (Sec. 3)
**Federal worker**: Any employee of a federal agency or a contractor who works for a federal agency (Sec. 3)
**Contractor**: A person or company with a contract to provide goods or services (references federal definition in law) (Sec. 3)
**Covered action**: A legal case involving property that a federal worker owes money on, where the loan or mortgage existed before the shutdown started (Sec. 7)
**Covered insurance policy**: Health, life, disability, or car insurance that a federal worker had before the shutdown began (Sec. 11)
## EFFECTIVE DATE
Not specified in bill text
II
118TH CONGRESS
1ST SESSION
S. 640
To suspend the enforcement of certain civil liabilities of Federal employees
and contractors during a lapse in appropriations, or during a breach
of the statutory debt limit, and for other purposes.
IN THE SENATE OF THE UNITED STATES
MARCH 2, 2023
Mr. SCHATZ (for himself, Mr. BLUMENTHAL, Mr. BROWN, Mr. CARDIN, Ms.
CORTEZ MASTO, Ms. DUCKWORTH, Mrs. FEINSTEIN, Ms. HIRONO, Mr.
KAINE, Ms. KLOBUCHAR, Mr. MENENDEZ, Mr. MERKLEY, Mr. PADILLA,
Mr. SANDERS, Mr. VAN HOLLEN, Mr. WARNER, and Ms. WARREN) intro-
duced the following bill; which was read twice and referred to the Com-
mittee on Finance
A BILL
To suspend the enforcement of certain civil liabilities of
Federal employees and contractors during a lapse in
appropriations, or during a breach of the statutory debt
limit, and for other purposes.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE.
3
This Act may be cited as the ‘‘Federal Employees
4
Civil Relief Act’’.
5
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•S 640 IS
SEC. 2. PURPOSE.
1
The purpose of this Act is to provide for the tem-
2
porary suspension of judicial and administrative pro-
3
ceedings and transactions that may adversely affect the
4
civil rights of Federal workers during a shutdown.
5
SEC. 3. DEFINITIONS.
6
In this Act:
7
(1) CONSUMER REPORTING AGENCY.—The term
8
‘‘consumer reporting agency’’ has the meaning given
9
the term in section 603(f) of the Fair Credit Report-
10
ing Act (15 U.S.C. 1681a(f)).
11
(2) CONTRACTOR.—The term ‘‘contractor’’ has
12
the meaning given the term in section 7101 of title
13
41, United States Code.
14
(3) COURT; JUDGMENT; STATE.—The terms
15
‘‘court’’, ‘‘judgment’’, and ‘‘State’’ have the mean-
16
ings given those terms in section 101 of the
17
Servicemembers Civil Relief Act (50 U.S.C. 3911).
18
(4) COVERED PERIOD.—The term ‘‘covered pe-
19
riod’’ means the period beginning on the date on
20
which a shutdown begins and ending on the date
21
that is 30 days after the date on which that shut-
22
down ends.
23
(5) FEDERAL
WORKER.—The term ‘‘Federal
24
worker’’—
25
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•S 640 IS
(A) means an employee of a Government
1
agency; and
2
(B) includes an employee of a contractor.
3
(6) GOVERNMENT AGENCY.—The term ‘‘Gov-
4
ernment agency’’ means each authority of the execu-
5
tive, legislative, or judicial branch of the Government
6
of the United States.
7
(7) SHUTDOWN.—The term ‘‘shutdown’’ means
8
any period in which—
9
(A) there is more than a 24-hour lapse in
10
appropriations for any Government agency or
11
Federal department as a result of a failure to
12
enact a regular appropriations bill or continuing
13
resolution; or
14
(B) the debt of the United States Govern-
15
ment is greater than the statutory limit under
16
section 3101 of title 31, United States Code.
17
SEC. 4. JURISDICTION.
18
(a) JURISDICTION.—This Act shall apply to—
19
(1) the United States;
20
(2) each of the States, including each political
21
subdivision of a State; and
22
(3) all territory that is subject to the jurisdic-
23
tion of the United States.
24
(b) APPLICABILITY TO PROCEEDINGS.—This Act—
25
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•S 640 IS
(1) shall apply to any judicial or administrative
1
proceeding that is commenced in any court or agen-
2
cy in any jurisdiction that is subject to this Act; and
3
(2) shall not apply to criminal proceedings or
4
with respect to child support payments.
5
(c) COURT
IN
WHICH
APPLICATION
MAY
BE
6
MADE.—When, under this Act, any application is required
7
to be made to a court in which no proceeding has already
8
been commenced with respect to a matter, that application
9
may be made to any court that would otherwise have juris-
10
diction over the matter.
11
(d) NOTIFICATION.—
12
(1) IN GENERAL.—The head of the Government
13
agency that employs a Federal worker, or at which
14
a Federal worker performs services, as applicable,
15
shall provide the Federal worker with written notice
16
regarding the benefits provided under this Act—
17
(A) on the date on which the individual be-
18
comes a Federal worker; and
19
(B) periodically after the date described in
20
subparagraph (A), including on the date on
21
which any shutdown begins.
22
(2) LEGISLATIVE
AND
JUDICIAL
BRANCH.—
23
With respect to a Federal worker in a Government
24
agency in the legislative branch or judicial branch,
25
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•S 640 IS
(or, in the case of a Federal worker who is an em-
1
ployee of a contractor, who provides services at a
2
Government agency in the legislative branch or judi-
3
cial branch), the officer or employee at the Govern-
4
ment agency who has the final authority to appoint,
5
hire, discharge, and set the terms, conditions, or
6
privileges of the employment of the Federal worker
7
shall provide the notice required under paragraph
8
(1).
9
SEC. 5. ANTICIPATORY RELIEF.
10
A Federal worker who is furloughed or required to
11
work without pay during a shutdown may apply to a court
12
for a temporary stay, postponement, or suspension with
13
respect to any payment of rent, mortgage, tax, fine, pen-
14
alty, insurance premium, student loan repayment, or other
15
civil obligation or liability that the Federal worker or indi-
16
vidual, as applicable, owes or would owe during the dura-
17
tion of the shutdown.
18
SEC. 6. EVICTIONS.
19
(a) COURT-ORDERED EVICTION.—Except by the
20
order of a court, a landlord may not, during a shutdown—
21
(1) evict a Federal worker from premises that
22
are occupied or intended to be occupied primarily as
23
a residence; or
24
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•S 640 IS
(2) subject premises described in paragraph (1)
1
to a distress.
2
(b) STAY OF EXECUTION.—
3
(1) COURT AUTHORITY.—Upon an application
4
for eviction or distress with respect to premises de-
5
scribed in subsection (a)(1), a court may, upon mo-
6
tion of the court, and shall, if a request is made by
7
or on behalf of a Federal worker, the ability of
8
whom to pay the rent that is the subject of the ac-
9
tion is materially affected by a shutdown—
10
(A) stay the proceedings for a period of 30
11
days, unless, in the opinion of the court, justice
12
and equity require a longer or shorter period of
13
time; or
14
(B) adjust the obligation under the lease to
15
preserve the interests of all parties.
16
(2) RELIEF TO LANDLORD.—If a court grants
17
a stay under paragraph (1), the court may grant to
18
the landlord (or other person with paramount title)
19
such relief as equity may require.
20
(c) MISDEMEANOR.—Except as provided in sub-
21
section (a), a person that knowingly takes part in an evic-
22
tion or distress described in that subsection, or that know-
23
ingly attempts to take part in an eviction or distress de-
24
scribed in that subsection, shall be fined as provided in
25
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•S 640 IS
title 18, United States Code, or imprisoned for not more
1
than 1 year, or both.
2
SEC. 7. MORTGAGE PROTECTION AND FORECLOSURES.
3
(a) DEFINITION.—In this section, the term ‘‘covered
4
action’’ means an action relating to an obligation—
5
(1) with respect to real or personal property
6
owned by a Federal worker; and
7
(2) that—
8
(A) originated before the date on which a
9
shutdown begins;
10
(B) is in effect on the date on which a
11
shutdown begins; and
12
(C) is secured by a mortgage, trust deed,
13
or other security in the nature of a mortgage.
14
(b) STAY OF PROCEEDINGS AND ADJUSTMENT OF
15
OBLIGATION.—If a covered action is filed in a court dur-
16
ing a covered period, the court may, after a hearing and
17
upon the motion of the court, and shall, upon application
18
by the Federal worker if the ability of the Federal worker
19
to comply with the covered obligation is materially affected
20
by the shutdown—
21
(1) stay the proceedings for a period of time as
22
justice and equity require; or
23
(2) adjust the obligation to preserve the inter-
24
ests of all parties.
25
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•S 640 IS
(c) SALE OR FORECLOSURE.—A sale, foreclosure, or
1
seizure of property for a breach of an obligation described
2
in subsection (a) by a Federal worker shall not be valid
3
if made during a covered period except upon the order of
4
a court that is granted before that sale, foreclosure, or
5
seizure, as applicable, with a return made and approved
6
by the court.
7
(d) MISDEMEANOR.—A person that knowingly makes
8
or causes to be made a sale, foreclosure, or seizure of prop-
9
erty that is prohibited under subsection (c), or that know-
10
ingly attempts to make or cause to be made a sale, fore-
11
closure, or seizure of property that is prohibited under
12
that subsection, shall be fined as provided in title 18,
13
United States Code, or imprisoned for not more than 1
14
year, or both.
15
SEC. 8. LIENS.
16
(a) LIENS.—
17
(1) DEFINITION.—In this subsection, the term
18
‘‘lien’’ includes—
19
(A) a lien—
20
(i) for storage, repair, or cleaning of
21
the property or effects of a Federal work-
22
er; and
23
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•S 640 IS
(ii) on the property or effects de-
1
scribed in clause (i) for any reason other
2
than a reason described in that clause; and
3
(B) a loan that a Federal worker has ob-
4
tained with respect to a motor vehicle.
5
(2) LIMITATION
ON
FORECLOSURE
OR
EN-
6
FORCEMENT.—A person holding a lien on the prop-
7
erty or effects of a Federal worker may not, during
8
a covered period, foreclose on or enforce that lien
9
without the order of a court that was issued before
10
the date on which that foreclosure or enforcement
11
occurs.
12
(b) STAY
OF PROCEEDINGS.—In a proceeding to
13
foreclose on or enforce a lien that is subject to this section,
14
a court may, upon the motion of the court, and shall, if
15
requested by a Federal worker, the ability of whom to
16
comply with the obligation resulting in the proceeding is
17
materially affected by a shutdown—
18
(1) stay the proceeding for a period of time as
19
justice and equity require; or
20
(2) adjust the obligation to preserve the inter-
21
ests of all parties.
22
(c) MISDEMEANOR.—A person that knowingly takes
23
an action that violates this section, or attempts to take
24
an action that violates this section, shall be fined as pro-
25
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•S 640 IS
vided in title 18, United States Code, or imprisoned for
1
not more than 1 year, or both.
2
SEC. 9. STUDENT LOANS.
3
(a) DEFINITION OF STUDENT LOAN.—In this sec-
4
tion, the term ‘‘student loan’’ means the following:
5
(1) A loan made, insured, or guaranteed under
6
title IV of the Higher Education Act of 1965 (20
7
U.S.C. 1070 et seq.), including any Federal Direct
8
Stafford Loan, Federal Direct Unsubsidized Staf-
9
ford Loan, Federal Direct PLUS Loan, or Federal
10
Direct Consolidation Loan.
11
(2) A private education loan, as such term is
12
defined in section 140(a) of the Truth in Lending
13
Act (15 U.S.C. 1650(a)).
14
(b) APPLICATION TO STUDENT LOANS.—This section
15
shall apply to any situation in which—
16
(1) the student loan payment of a Federal
17
worker falls due or remains unpaid during a shut-
18
down; and
19
(2) during the shutdown described in paragraph
20
(1), the Federal worker described in that paragraph
21
has been furloughed or required to work without
22
pay.
23
(c) DEFERMENT ELIGIBILITY.—During a covered pe-
24
riod, a Federal worker shall be eligible for deferment, dur-
25
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•S 640 IS
ing which, with respect to a student loan, periodic install-
1
ments of principal need not be paid and interest shall not
2
accrue.
3
(d) LIMITATION ON DEFAULTS.—If the student loan
4
payment of a Federal worker falls due and remains unpaid
5
during a shutdown, the lender with respect to the student
6
loan may not place the loan in default without the order
7
of a court.
8
(e) LIMITATION ON COLLECTIONS.—If the student
9
loan of a Federal worker has been placed in default before
10
the date on which a shutdown begins, the lender with re-
11
spect to the student loan may not, without the order of
12
a court, perform any of the following activities during the
13
covered period with respect to the shutdown:
14
(1) Send the student loan to collection.
15
(2) Report adverse information with respect to
16
the Federal worker to a consumer reporting agency.
17
(3) Garnish wages, tax refunds, or government
18
benefits.
19
(f) COURT STAY.—In a proceeding to collect a stu-
20
dent loan payment that is subject to this section, a court
21
may, upon the motion of the court, and shall, if requested
22
by a Federal worker whose ability to comply with the obli-
23
gation resulting in the proceeding is materially affected
24
by a shutdown—
25
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•S 640 IS
(1) stay the proceeding for a period of time as
1
justice and equity require; or
2
(2) adjust the obligation to preserve the inter-
3
ests of all parties.
4
(g) MISDEMEANOR.—A person that knowingly vio-
5
lates this section, or attempts to violate this section, shall
6
be fined as provided in title 18, United States Code, or
7
imprisoned for not more than 1 year, or both.
8
SEC. 10. INCOME TAXES.
9
(a) DEFERRAL OF TAX.—Upon notice to the Internal
10
Revenue Service, the collection of Federal income tax on
11
the income of a Federal worker falling due during a shut-
12
down shall be deferred for a period of not more than 90
13
days after
[Text truncated for display. Full text available on Congress.gov.]