Team Relocation Taxpayer Protection Act of 1996

Summary: Team Relocation Taxpayer Protection Act of 1996 - Prohibits specified entities or persons (entities) from benefiting from any expenditure of Federal funds or from being allowed any Federal tax exclusion, deduction, credit, exemption, or allowance in connection with the relocation of a National Football League (NFL) franchise of such entity.  Specifies that the interest paid or accrued on any bond from which proceeds are used or to be used to provide facilities for any such entity shall not be exempt from Federal tax. 
Makes such provision applicable:  (1) to any entity that has conducted regular season home football games through ownership of a franchise in the NFL in facilities which are owned by a State or local government or financed by a Federal, State, or local governmental unit, has publicly announced that it intends to conduct such football games outside such facilities before the expiration of the period during which such governmental unit has authorized the entity to use such facilities, has publicly announced that it intends to conduct such football games in facilities to be owned by a State or local government or to be financed by a Federal, State, or local governmental unit; (2) if in the NFL season preceding the announcement of the entity's intention to relocate, attendance at the regular season home football games of such entity averaged at least 75 percent of normal capacity as previously published by the NFL with respect to such season; and (3) if within one year before or after such announcement, an election or referendum has been held by the State or local government and the voters have approved a tax increase or extension of a tax, or have failed to repeal any such increase or extension, intended to be used as part of the financing for improved facilities or new facilities for such football games of such entity. 
Sets forth provisions regarding:  (1) preemption (no preemption of State or local actions); (2) who constitutes a "related person" for tax purposes; and (3) bankruptcy venue.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Team Relocation Taxpayer Protection 
Act of 1996''.

SEC. 2. TREATMENT OF RELOCATING NATIONAL FOOTBALL LEAGUE FRANCHISES.

    (a) Effect on Interstate Commerce.--
            (1) Findings.--The Congress finds that the conduct of a 
        National Football League franchise occurs in interstate 
        commerce and has a substantial effect on interstate commerce 
        and that when the facts and circumstances described in 
        subsection (c)(1) are combined, there arises substantial 
        potential for harmful effects on interstate commerce.
            (2) Purpose.--The purpose of this section is to deter such 
        harmful effects.
            (3) No preemption of state or local actions.--Such other 
        actions as may be taken by a State or local governmental unit 
        or entity referred to in subsection (c)(1)(A) to address the 
        facts and circumstances described in subsection (c)(1) are not 
        preempted by this section and do not burden interstate 
        commerce.
    (b) Federal Treatment.--Notwithstanding any other provision of 
law--
            (1) any entity or person described in paragraph (1) or (2) 
        of subsection (c)--
                    (A) may not benefit, directly or indirectly, from 
                any expenditure of Federal funds, and
                    (B) shall not be allowed any Federal tax exclusion, 
                deduction, credit, exemption, or allowance,
        in connection with or in any way related to the relocation of a 
        National Football League franchise of an entity or person 
        described in subsection (c)(1); and
            (2) the interest paid or accrued on any bond, any portion 
        of the proceeds of which is used or is to be used to provide 
        facilities that are used or are to be used in whole or in part 
        by any entity or person described in paragraph (1) or (2) of 
        subsection (c), shall not be exempt from any Federal tax.
    (c) Entity or Person Described.--For purposes of this section--
            (1) General description.--An entity or person is described 
        in this paragraph if--
                    (A) the entity or person has conducted regular 
                season home football games through ownership of a 
                franchise in the National Football League in 
                facilities--
                            (i) which are owned, directly or 
                        indirectly, by a State or local governmental 
                        unit or entity, or
                            (ii) which are financed by a Federal, 
                        State, or local governmental unit or entity;
                    (B) the entity or person has publicly announced 
                that such entity or person has the intention to conduct 
                such football games outside the facilities described in 
                subparagraph (A) before the expiration of the period 
                during which such governmental unit or entity has 
                authorized the entity or person to use such facilities;
                    (C) the entity or person has publicly announced 
                that such entity or person has the intention to conduct 
                such football games in facilities--
                            (i) to be owned, directly or indirectly, by 
                        a State or local governmental unit or entity, 
                        or
                            (ii) to be financed by a Federal, State, or 
                        local governmental unit or entity;
                    (D) in the National Football League season 
                preceding the announcement of the intention of the 
                entity or person to relocate, attendance at the regular 
                season home football games of such entity or person 
                averaged at least 75 percent of normal capacity as 
                previously published by the National Football League 
                with respect to such season; and
                    (E) within the period of 1 year before or after 
                such announcement by the entity or person, an election 
                or referendum has been held by the State or local 
                governmental unit in which the facilities described in 
                subparagraph (A) are located and the voters have 
                approved a tax increase or extension of a tax, or have 
                failed to repeal any such tax increase or extension, 
                intended by such governmental unit to be used as part 
                of the financing for improved facilities or new 
                facilities for such football games of such entity or 
                person.
            (2) Related person.--
                    (A) In general.--An entity or person is described 
                in this paragraph if such entity or person is a related 
                person to an entity or person described in paragraph 
                (1).
                    (B) Application of certain rules.--For purposes of 
                this paragraph, a person or entity shall be treated as 
                a related person to an entity or person described in 
                paragraph (1) if--
                            (i) under the terms of section 144(a)(3) of 
                        the Internal Revenue Code of 1986, such person 
                        or entity would be treated as a related person 
                        to an entity or person described in paragraph 
                        (1), or
                            (ii) such person or entity is a successor 
                        in interest to an entity or person described in 
                        paragraph (1) or to any related person.
                    (C) Rules regarding certain relationships.--In 
                determining whether a person or entity is a related 
                person to an entity or person described in paragraph 
                (1), the rules of sections 144(a)(3), 267, 707(b), and 
                1563 of the Internal Revenue Code of 1986 shall be 
                applied--
                            (i) by substituting ``at least 25 percent'' 
                        for ``more than 50 percent'' each place it 
                        appears therein and by determining such 
                        percentage on the basis of the highest 
                        percentage of the stock or other indices of 
                        ownership that any person or entity has owned 
                        directly or indirectly at any time after 
                        December 31, 1991,
                            (ii) by treating a person's step-children 
                        or step-grandchildren as the person's natural 
                        children or grandchildren, and
                            (iii) by treating all children and step-
                        children of such person as if they have not 
                        attained the age of 21 years.
    (d) Bankruptcy Venue.--Notwithstanding any other provision of law, 
including titles 11 and 28 of the United States Code, any case under 
such title 11 with respect to an entity or person described in 
paragraph (1) or (2) of subsection (c) may be commenced only in the 
district court for the judicial district in which the principal place 
of business in the United States of such entity or person has been 
located during the greatest part of the 3-year period immediately 
preceding the commencement of such case.
    (e) Effective Date.--This section shall apply to--
            (1) any expenditure of Federal funds on or after the date 
        of the introduction of this Act,
            (2) any case commenced under title 11, United States Code, 
        after November 1, 1995, and
            (3) any Federal tax exclusion, deduction, credit, 
        exemption, or allowance for any taxable period ending after 
        December 31, 1994.