LEXINGTON, KY--(Marketwire - Dec 11, 2012) - The National Association of State Treasurers (NAST) today commended the U.S. Senate for supporting a full debate on the extension of the Transaction Account Guarantee (TAG) Program.
The U.S. Senate voted earlier today to invoke cloture on S. 3637, which would temporarily extend the federal deposit insurance coverage for noninterest-bearing transaction accounts. Passage of today's vote will allow the bill to proceed to the Senate floor for full debate. Also, earlier today, the White House expressed its official support for continuation of the TAG Program. Members of NAST continue to urge Congress to pass a two-year extension, citing significant benefits to state and local governments and the U.S. banking system. As it currently stands, the TAG Program will expire on Dec. 31.
"NAST appreciates the support of U.S. Senator Harry Reid for filing the motion of cloture and sponsoring the legislation to extend the TAG Program," said NAST President and Nevada State Treasurer Kate Marshall. "NAST is asking that the TAG Program be temporarily extended to allow for a proper transition period."
Representatives of NAST met earlier today with senior U.S. Treasury officials to discuss the importance of, and need for, this program. The Federal Deposit Insurance Corporation (FDIC) launched the TAG Program in 2008 in the midst of the global financial crisis. Its purpose is to strengthen confidence in the banking system and to ensure liquidity.
"We are grateful for the support expressed by the President with regards to extending the TAG Program," said Delaware State Treasurer Chip Flowers. "Today's vote reflects large bipartisan support for advancing the debate on this extremely important program. We cannot end the TAG Program without giving governments, businesses and consumers ample time to transition. We look forward to working with the White House and Congress in moving towards passage of this important, yet temporary, federal insurance program."
State and local governments, as well as many of the nation's universities, charities and hospitals rely upon the security of these federally insured accounts to protect their funds from excessive market instability, and to ensure that these funds will be available even in the extreme case of a bank failure. A two-year extension of the TAG Program would protect these taxpayers' funds from market volatility and the instability related to the "fiscal cliff" resolution (or lack thereof) and the upcoming debt ceiling debate.
During its recent annual conference, NAST voted to extend its resolution supporting the TAG Program. To see the full resolution, visit www.nast.org.
About NAST: NAST membership is composed of all state treasurers or state finance officials with comparable responsibilities from the United States, its commonwealths, territories and the District of Columbia. NAST's mission is to provide advocacy and support that enables member states to pursue and administer sound financial policies and programs benefitting the citizens of the nation. For more information, visit www.nast.org.