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HR 4789119th CongressIn Committee

FAIR Act

Introduced: Jul 29, 2025
Sponsor: Rep. Davidson, Warren [R-OH-8] (R-Ohio)
Civil Rights & Justice
View on Congress.gov
Standard Summary
Comprehensive overview in 1-2 paragraphs

The FAIR Act (Fiscal Accountability for Interest on Reserves Act) would amend the Federal Reserve Act by striking paragraph (12) of section 19(b) (12 U.S.C. 461(b)), which is described as a provision relating to earnings on balances. By removing that paragraph, the bill eliminates a specific rule governing how earnings on certain balances are handled within the Federal Reserve System. The change would take effect 180 days after enactment. Introduced in the House by Rep. Davidson on July 29, 2025, the bill was referred to the Committee on Financial Services. The text provided does not detail what replaces the struck provision, so the exact operational or financial impact depends on the content of the removed paragraph and how the Fed would handle earnings on balances after the change.

Key Points

  • 1Short title: The bill is named the Fiscal Accountability for Interest on Reserves Act (FAIR Act).
  • 2What it does: Amends the Federal Reserve Act by striking paragraph (12) of section 19(b), removing the “earnings on balances” provision.
  • 3Effective date: The amendment becomes effective 180 days after enactment.
  • 4Scope of change: Only the specific paragraph (12) of section 19(b) is removed; the rest of the Federal Reserve Act remains in place.
  • 5Legislative action: Introduced in the House by Rep. Davidson on July 29, 2025, and referred to the Committee on Financial Services.

Impact Areas

Primary group/area affected: The Federal Reserve System and depository institutions with reserve balances; potential changes in how earnings on balances are treated within the Fed’s framework.Secondary group/area affected: The U.S. Treasury and taxpayers, depending on whether the removal alters remittances or distributions of Federal Reserve earnings.Additional impacts: Possible effects on monetary policy operations and balance sheet management contingent on the pre-existing role of the struck provision; introduces a 180-day transition period for the Fed to adjust.
Generated by gpt-5-nano on Oct 8, 2025