12 U.S.C. § 289 — Dividends and surplus funds of reserve banks; transfer for fiscal year 2000

(a) Dividends and surplus funds. (1) Dividend amount. After a Federal Reserve bank pays or sets aside money for all its necessary expenses, its stockholders get an annual dividend on their paid-in capital stock. For a stockholder with total consolidated assets over $10,000,000,000, the dividend rate is the smaller of (I) the high yield on the 10-year Treasury note from the most recent auction before the dividend is paid, or (II) 6 percent. For a stockholder with total consolidated assets of $10,000,000,000 or less, the rate is a flat 6 percent. This dividend entitlement is cumulative — meaning any dividend that isn't paid in a given year still has to be paid eventually. The Board of Governors of the Federal Reserve System must adjust the $10,000,000,000 asset threshold every year, based on changes in the Gross Domestic Product Price Index published by the Bureau of Economic Analysis. (2) Surplus fund. Whatever is left of a Federal Reserve bank's net earnings, after its dividend obligations are fully paid, goes into that bank's surplus fund. (3) Limit on total surplus. The combined surplus funds of all the Federal Reserve banks cannot exceed $6,825,000,000. Any amount that would push the total surplus above that limit must instead be transferred to the Board of Governors, which sends it to the Secretary of the Treasury to be deposited in the Treasury's general fund. (b) Special transfer for fiscal year 2000. (1) Amount. The Federal Reserve banks had to transfer a total of $3,752,000,000 from their surplus funds, through the Board of Governors, to the Secretary of the Treasury, for deposit in the Treasury's general fund, in fiscal year 2000. (2) How it was divided. Of that total amount, the Board of Governors decided how much each individual Reserve bank had to pay in that fiscal year. (3) No refilling that amount. During fiscal year 2000, no Federal Reserve bank could refill its surplus fund by the amount it had to transfer under paragraph (1).