Government Bailout Prevention Act

This bill would bar the use of federal funds to buy or guarantee the debts of, lend to, or give grants to state, local, county, or municipal governments or school districts that, on or after January 1, 2026, have filed for bankruptcy, defaulted, or are at risk of or likely to default. It would bar the Treasury Secretary from using general fund revenues or borrowed money to buy or guarantee those governments' assets or debts. It would also bar Federal Reserve banks from lending to, buying bonds of, or otherwise financially assisting any state or local government, school district, or other entity with taxing or bonding authority. The limits would not apply to aid after a declared disaster, regular appropriations or direct spending, or grants awarded by the United States, and the ban would cover debt restructuring.

Full text and official record on Congress.gov

Sponsors

• W. Gregory Steube Republican sponsor
• 3 cosponsors