Peace, Democracy and Development in El Salvador Act of 1991

Peace, Democracy and Development in El Salvador Act of 1991 - Expresses the sense of the Congress that the United States shall use diplomacy to encourage the Government of El Salvador and the Farabundo Marti National Liberation Front (FMLN) to: (1) participate in good-faith negotiations to achieve a cease-fire and permanent settlement of the conflict in El Salvador; (2) adhere to the terms of agreements signed in Geneva, Switzerland, Caracas, Venezuela, and San Jose, Costa Rica; and (3) support the role of the Secretary General of the United Nations in advancing proposals on the outstanding issues defined in the Caracas accords to resolve the conflict.

Withholds from El Salvador unobligated military assistance for FY 1991 and prior fiscal years and military assistance allocated for FY 1992 and 1993 until the Congress enacts a joint resolution authorizing the provision of such assistance and the President reports to the Congress that: (1) those responsible for ordering and carrying out, or obstructing the investigation into, the November 1989 murders of certain priests and civilians have been apprehended and brought to justice; (2) internationally recognized workers' rights have been extended to Salvadoran workers; (3) the El Salvadoran Government has pursued legal avenues to bring to trial and obtain verdicts for those responsible for the murders of Archbishop Romero and certain land reformers and for the bombings of the FENASTRAS headquarters; (4) the El Salvadoran Government is complying with international standards of respect for humanitarian and medical workers; (5) steps have been taken to place the El Salvadoran military under the control of the civilian government; (6) the El Salvadoran Government is negotiating to achieve a cease-fire and a settlement of the conflict and has not rejected a plan for the settlement of the conflict put forth by the United Nations Secretary General; and (7) the El Salvadoran Government, through its military and security forces, has not engaged in assassinations of, or acts of violence against, civilians and has not failed to control such activities by elements subject to the control of such forces.

Prohibits funding for: (1) the stationing of U.S. military personnel in El Salvador as trainers or advisors to the El Salvadoran armed forces; and (2) the financing of covert operations in El Salvador or for covert military assistance to the El Salvadoran Government.

Establishes the Demobilization, Transition, and Reconstruction Fund to assist with the cost of monitoring a permanent settlement of the conflict, the demobilization of combatants in the conflict and their transition to peaceful pursuits, and the reconstruction of El Salvador. Makes the Fund available only upon the President's notification to the Congress that the El Salvadoran Government and the FMLN have reached a permanent settlement to the conflict. Requires the President, upon notification of a permanent settlement or on September 30, 1992, if no notification has occurred prior to such date, to transfer withheld military assistance to the Fund.

Prohibits economic support fund (ESF) assistance from being obligated as balance-of-payments or cash assistance for El Salvador.

Makes ESF assistance for El Salvador available only for projects for child nutrition, health, clean water, basic education, agrarian reform, and other human needs of the people of El Salvador. Requires such assistance to be used only for programs implemented solely by civilian agencies.

Subjects ESF assistance for El Salvador to reprogramming notifications under the Foreign Assistance Act of 1961.