article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Federal Reserve Reform Act of 1995''. SEC. 2. MEMBERSHIP OF THE FEDERAL OPEN MARKET ADVISORY COMMITTEE. (a) In General.--Section 12A(a) of the Federal Reserve Act (12 U.S.C. 263(a)) is amended to read as follows: ``(a) Establishment of Advisory Committee.-- ``(1) In general.--There is established a Federal Open Market Advisory Committee (hereafter in this section referred to as the `Advisory Committee'), which shall consist of the presidents of the Federal Reserve banks. ``(2) Chairperson.--The president of the Federal Reserve Bank of New York shall serve as the chairperson of the Advisory Committee. ``(3) Meetings.--The meetings of the Advisory Committee shall be held in Washington, District of Columbia, not less than 4 times each year upon the call of the Board. ``(4) Duties.--The Advisory Committee shall advise the Board on the conduct of open-market operations.''. (b) Conforming Amendments.-- (1) Federal reserve act.--The Federal Reserve Act (12 U.S.C. 221 et seq.) is amended-- (A) in section 2A (12 U.S.C. 225a)-- (i) by striking ``and the Federal Open Market Committee'' each place it appears; and (ii) in the sixth sentence, by striking ``determine'' and inserting ``determines''; (B) in the tenth undesignated paragraph of section 10 (12 U.S.C. 247a)-- (i) by striking ``and by the Federal Open Market Committee''; and (ii) by striking ``and the Committee''; (C) in section 12A (12 U.S.C. 263)-- (i) in subsection (b)-- (I) by striking ``Committee'' each place it appears and inserting ``Board''; and (II) by inserting ``Regulations.-- '' before ``No Federal Reserve''; and (ii) in subsection (c), by inserting ``Accommodation of Commerce and Business.--'' before ``The time''; and (D) in section 14(b)(2) (12 U.S.C. 355(2)), by striking ``Federal Open Market Committee'' and inserting ``Board''. (2) International lending supervision act of 1983.--Section 911(a)(3)(C) of the International Lending Supervision Act of 1983 (12 U.S.C. 3910(a)(3)(C)) is amended by striking ``Federal Open Market Committee'' and inserting ``Board of Governors of the Federal Reserve System''. SEC. 3. CONSULTATION BETWEEN THE BOARD OF GOVERNORS AND THE SECRETARY OF THE TREASURY, THE DIRECTOR OF THE OMB, AND THE CHAIRMAN OF THE CEA. Section 2A of the Federal Reserve Act (12 U.S.C. 225a) (as amended by section 2(b)(1)(A)) is amended-- (1) in the first sentence, by striking ``The Board of Governors'' and inserting the following: ``(a) In General.--The Board of Governors''; and (2) by adding at the end the following new subsection: ``(b) Consultation Required.--The Board of Governors shall meet and consult with the Secretary of the Treasury, the Director of the Office of Management and Budget, and the chairman of the Council of Economic Advisors-- ``(1) during the 30-day period immediately preceding the date on which each report required under the second sentence of subsection (a) is submitted to the Congress by the Board of Governors; and ``(2) during the 30-day period beginning on the date which is 100 days immediately preceding the date by which the President is required to submit the budget under section 1105(a) of title 31, United States Code.''. SEC. 4. APPOINTMENT OF THE CHAIRMAN AND VICE CHAIRMAN. (a) Appointment of the Chairman and Vice Chairman.--The second undesignated paragraph of section 10 of the Federal Reserve Act (12 U.S.C. 242) is amended by striking the third sentence and inserting the following: ``The President shall appoint, by and with the advice and consent of the Senate, one member of the Board to serve as Chairman. The term of such member as Chairman shall expire on January 31 of the first calendar year beginning after the end of the term of the President who appointed such member as Chairman. If a member appointed as Chairman does not complete the term of such office as established in the preceding sentence, the President shall appoint, by and with the advice and consent of the Senate, another member to complete the unexpired portion of such term. The President shall also appoint, by and with the advice and consent of the Senate, one member of the Board to serve as Vice Chairman for a term of 4 years. The Chairman and the Vice Chairman may each serve after the end of their respective terms until a successor has taken office.''. (b) Performance of Duties.--The second undesignated paragraph of section 10 of the Federal Reserve Act (12 U.S.C. 242) (as amended by subsection (a) of this section) is amended by inserting after the seventh sentence the following: ``In the event of the absence or unavailability of the Chairman, the Vice Chairman or (in the Vice Chairman's absence) another member of the Board may be designated by the Chairman to perform the duties of the office of the Chairman. If a vacancy occurs in the office of the Chairman, the Vice Chairman shall perform the duties of the Chairman until a successor takes office. If a vacancy occurs in the office of the Vice Chairman while the office of the Chairman is vacant, the member of the Board with the most years of service on the Board shall perform the duties of the Chairman until a successor takes office.''. (c) Effective Date.-- (1) In general.--Except as provided in paragraph (2), the amendments made by this section shall take effect on the date of enactment of this Act. (2) Current chairman to complete term.--Notwithstanding the amendment made by subsection (a), any member who holds the office of Chairman of the Board of Governors of the Federal Reserve System on the date of enactment of this Act shall continue in such office during the remainder of the term to which such member was appointed. SEC. 5. DISCLOSURE OF INTERMEDIATE TARGETS. Section 12A(b) of the Federal Reserve Act (12 U.S.C. 263(b)) (as amended by section 2(b)(1)(C)(i)) is amended by adding at the end the following: ``Notwithstanding any other provision of law, each change, of any nature whatsoever, in the intermediate targets for monetary policy, which change is adopted by the Board, shall be disclosed to the public on the date on which such change is adopted. For purposes of this subsection, the term `intermediate targets' means any policy objectives regarding monetary aggregates, credit aggregates, prices, interest rates, or bank reserves.''. SEC. 6. AUDIT OF FINANCIAL TRANSACTIONS BY COMPTROLLER GENERAL. Section 714(b) of title 31, United States Code, is amended-- (1) in paragraph (1), by inserting ``or'' at the end; and (2) by striking paragraphs (2) through (4) and inserting the following: ``(2) memoranda, letters, or other written communications between or among members of the Board of Governors of the Federal Reserve System or officers or employees of the Federal Reserve System relating to any transaction described in paragraph (1).''. SEC. 7. BOARD SUBJECT TO BUDGET PROCESS. Section 1105 of title 31, United States Code, is amended by adding at the end the following new subsection: ``(h) Federal Reserve Board Budget Treatment.--Not later than October 16 of each year, the estimated receipts and proposed expenditures of the Board of Governors of the Federal Reserve System and all Federal Reserve banks for the current year and the next 2 succeeding years shall be transmitted by the Board to the President. The President shall transmit to the Congress the information received in accordance with this subsection, without change, together with the budget transmitted to the Congress under subsection (a).''.
summary: Federal Reserve Reform Act of 1995 - Amends the Federal Reserve Act to abolish the current Federal Open Market Committee, on which the Board of Governors of the Federal Reserve System (the Board) sits, and replace it with a Federal Open Market Advisory Committee, on which the Board does not sit, which shall advise the Board on the conduct of open-market operations. Requires the Board to meet and consult with the Secretary of the Treasury, the Director of the Office of Management and Budget, and the chairman of the Council of Economic Advisers during specified periods. Revises the term of the Chairman of the Board to expire on January 31 of the first calendar year beginning after the end of the term of the President who appointed the Chairman. Provides for performance of the duties of Chairman and Vice Chairman in the event of absence, unavailability, or vacancy. Mandates that each Board-adopted change in the intermediate targets for monetary policy be disclosed to the public upon its date of adoption. Amends Federal law to: (1) instruct the Comptroller General to audit written communications by members of the Board or officers or employees of the Federal Reserve System with respect to financial transactions; and (2) mandate an annual transmittal to the President and the Congress of all estimated receipts and proposed expenditures of the Board and all Federal Reserve banks for the current year and the next two succeeding years.