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[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 238 Introduced in Senate (IS)]

111th CONGRESS
  1st Session
                                 S. 238

To provide $50,000,000,000 in new transportation infrastructure funding 
  through bonding to empower States and local governments to complete 
significant infrastructure projects across all modes of transportation, 
 including roads, bridges, rail and transit systems, ports, and inland 
                   waterways, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                           January 14 , 2009

  Mr. Wyden (for himself, Mr. Thune, Ms. Klobuchar, and Ms. Collins) 
introduced the following bill; which was read twice and referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL

 
To provide $50,000,000,000 in new transportation infrastructure funding 
  through bonding to empower States and local governments to complete 
significant infrastructure projects across all modes of transportation, 
 including roads, bridges, rail and transit systems, ports, and inland 
                   waterways, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; ETC.

    (a) Short Title.--This Act may be cited as the ``Build America 
Bonds Act of 2009''.
    (b) References to Internal Revenue Code of 1986.--Except as 
otherwise expressly provided, whenever in this Act an amendment or 
repeal is expressed in terms of an amendment to, or repeal of, a 
section or other provision, the reference shall be considered to be 
made to a section or other provision of the Internal Revenue Code of 
1986.

SEC. 2. FINDINGS AND PURPOSE.

    (a) Findings.--Congress finds the following:
            (1) Our Nation's highways, transit systems, railroads, 
        ports, and inland waterways drive our economy, enabling all 
        industries to achieve growth and productivity that makes 
        America strong and prosperous.
            (2) The establishment, maintenance, and improvement of the 
        national transportation network is a national priority, for 
        economic, environmental, energy, security, and other reasons.
            (3) The ability to move people and goods is critical to 
        maintaining State, metropolitan, rural, and local economies.
            (4) The construction of infrastructure requires the skills 
        of numerous occupations, including those in the contracting, 
        engineering, planning and design, materials supply, 
        manufacturing, distribution, and safety industries.
            (5) Investing in transportation infrastructure creates 
        long-term capital assets for the Nation that will help the 
        United States address its enormous infrastructure needs and 
        improve its economic productivity.
            (6) Investment in transportation infrastructure creates 
        jobs and spurs economic activity to put people back to work and 
        stimulate the economy.
            (7) Every billion dollars in transportation investment has 
        the potential to create up to 47,500 jobs.
            (8) Every dollar invested in the Nation's transportation 
        infrastructure yields at least $5.70 in economic benefits 
        because of reduced delays, improved safety, and reduced vehicle 
        operating costs.
            (9) Numerous experts have noted that the estimated cost to 
        maintain and improve our Nation's highways, bridges, and other 
        critical transportation infrastructure significantly exceeds 
        what is currently being provided by all levels of government.
    (b) Purpose.--The purpose of this Act is to provide financing for 
additional transportation infrastructure capital investments.

SEC. 3. CREDIT TO HOLDERS OF BUILD AMERICA BONDS.

    (a) In General.--Subpart I of part IV of subchapter A of chapter 1 
is amended by adding at the end the following new section:

``SEC. 54F. BUILD AMERICA BONDS.

    ``(a) Build America Bond.--For purposes of this subpart, the term 
`Build America bond' means any bond issued as part of an issue if--
            ``(1) 100 percent of the available project proceeds of such 
        issue are to be used for expenditures incurred after the date 
        of the enactment of this section for 1 or more qualified 
        projects pursuant to an allocation of such proceeds to such 
        project or projects by the Transportation Finance Corporation,
            ``(2) the bond is issued by the Transportation Finance 
        Corporation and is in registered form (within the meaning of 
        section 149(a)),
            ``(3) the issuer designates such bond for purposes of this 
        section,
            ``(4) the Transportation Finance Corporation certifies that 
        it meets the State contribution requirement of subsection (h) 
        with respect to such project, as in effect on the date of 
        issuance,
            ``(5) the Transportation Finance Corporation certifies that 
        the State in which an approved qualified project is located 
        meets the requirement described in subsection (i),
            ``(6) the face amount of such bond, when added to the face 
        amount of all Build America bonds previously designated under 
        paragraph (3) and issued in the calendar year, does not exceed 
        the Build America bond limitation for such year under 
        subsection (d),
            ``(7) the term of each bond which is part of such issue 
        does not exceed 30 years,
            ``(8) the payment of principal with respect to such bond is 
        the obligation of the Transportation Finance Corporation, and
            ``(9) the issue meets the requirements of subsection (e).
    ``(b) Qualified Project.--For purposes of this section, the term 
`qualified project' means the capital improvements to any 
transportation infrastructure project of any governmental unit or other 
person, including roads, bridges, rail and transit systems, ports, and 
inland waterways, proposed by 1 or more States and approved by the 
Transportation Finance Corporation, but does not include costs of 
operations or maintenance with respect to such project.
    ``(c) Applicable Credit Rate.--In lieu of section 54A(b)(3), for 
purposes of section 54A(b)(2), the applicable credit rate with respect 
to an issue under this section is the rate equal to an average market 
yield (as of the day before the date of sale of the issue) on 
outstanding long-term corporate debt obligations (determined in such 
manner as the Secretary prescribes).
    ``(d) Limitation on Amount of Bonds Designated.--
            ``(1) National limitation.--There is a Build America bond 
        limitation for each calendar year. Such limitation is--
                    ``(A) $5,000,000,000 for 2009,
                    ``(B) $5,000,000,000 for 2010,
                    ``(C) $10,000,000,000 for 2011,
                    ``(D) $10,000,000,000 for 2012,
                    ``(E) $10,000,000,000 for 2013,
                    ``(F) $10,000,000,000 for 2014, and
                    ``(G) except as provided in paragraph (4), zero 
                thereafter.
            ``(2) Minimum allocations to states.--In making allocations 
        for each calendar year under subsection (a)(1), the 
        Transportation Finance Corporation shall ensure that the amount 
        allocated for qualified projects located in each State for such 
        calendar year is not less than 1 percent of the total amount 
        allocated for such year.
            ``(3) Carryover of unused issuance limitation.--If for any 
        calendar year the limitation amount imposed by paragraph (1) 
        exceeds the amount of Build America bonds issued during such 
        year, such excess shall be carried forward to 1 or more 
        succeeding calendar years as an addition to the limitation 
        imposed by paragraph (1) and until used by issuance of Build 
        America bonds.
            ``(4) Issuance of small denomination bonds.--From the Build 
        America bond limitation for each year, the Transportation 
        Finance Corporation shall issue a limited quantity of Build 
        America bonds in small denominations suitable for purchase as 
        gifts by individual investors wishing to show their support for 
        investing in America's transportation infrastructure.
    ``(e) Special Rules Relating to Expenditures.--
            ``(1) In general.--An issue shall be treated as meeting the 
        requirements of this subsection if, as of the date of issuance, 
        the Transportation Finance Corporation reasonably expects--
                    ``(A) at least 100 percent of the available project 
                proceeds of such issue are to be spent for 1 or more 
                qualified projects within the 5-year expenditure period 
                beginning on such date,
                    ``(B) to incur a binding commitment with a State or 
                third party to spend at least 10 percent of the 
                proceeds of such issue, or to commence construction, 
                with respect to such projects within the 12-month 
                period beginning on such date, and
                    ``(C) to proceed with due diligence to complete 
                such projects and to spend the proceeds of such issue.
            ``(2) Rules regarding continuing compliance after 5-year 
        determination.--To the extent that less than 100 percent of the 
        available project proceeds of such issue are expended by the 
        close of the 5-year expenditure period beginning on the date of 
        issuance, the Transportation Finance Corporation shall redeem 
        all of the nonqualified bonds within 90 days after the end of 
        such period. For purposes of this paragraph, the amount of the 
        nonqualified bonds required to be redeemed shall be determined 
        in the same manner as under section 142.
            ``(3) Reallocation.--In the event the recipient of an 
        allocation under subsection (a)(1) after notice and a 
        reasonable opportunity to take corrective action fails to 
        demonstrate to the satisfaction of the Transportation Finance 
        Corporation that its actions will allow the Transportation 
        Finance Corporation to meet the requirements under this 
        subsection, the Transportation Finance Corporation may 
        redistribute the allocation meant for such recipient to other 
        recipients.
    ``(f) Recapture of Portion of Credit Where Cessation of 
Compliance.--If any bond which when issued purported to be a Build 
America bond ceases to be such a bond, the Transportation Finance 
Corporation shall pay to the United States (at the time required by the 
Secretary) an amount equal to the sum of--
            ``(1) the aggregate of the credits allowable under section 
        54A with respect to such bond (determined without regard to 
        section 54A(c)) for taxable years ending during the calendar 
        year in which such cessation occurs and each succeeding 
        calendar year ending with the calendar year in which such bond 
        is redeemed by the Transportation Finance Corporation, and
            ``(2) interest at the underpayment rate under section 6621 
        on the amount determined under paragraph (1) for each calendar 
        year for the period beginning on the first day of such calendar 
        year.
    ``(g) Build America Bonds Trust Account.--
            ``(1) In general.--The following amounts shall be held in a 
        Build America Bonds Trust Account by the Transportation Finance 
        Corporation:
                    ``(A) The proceeds from the sale of all bonds 
                issued under this section.
                    ``(B) The investment earnings on proceeds from the 
                sale of such bonds.
                    ``(C) The amount described in paragraph (2).
                    ``(D) Any earnings on any amounts described in 
                subparagraph (A), (B), or (C).
            ``(2) Appropriation of revenues.--There is hereby 
        appropriated to the Build America Bonds Trust Account an amount 
        equal to the lesser of--
                    ``(A) the revenues resulting from the imposition of 
                fees pursuant to section 13031 of the Consolidated 
                Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 
                58c) for fiscal years beginning after September 31, 
                2009, or
                    ``(B) $50,000,000,000.
            ``(3) Use of funds.--Amounts in the Build America Bonds 
        Trust Account may be used only to pay costs of qualified 
        projects, redeem Build America bonds, and fund the operations 
        of the Transportation Finance Corporation, except that amounts 
        withdrawn from the Build America Bonds Trust Account to pay 
        costs of qualified projects may not exceed the proceeds from 
        the sale of Build America bonds described in subsection (a)(1).
            ``(4) Use of remaining funds in build america bonds trust 
        account.--Upon the redemption of all Build America bonds issued 
        under this section, any remaining amounts in the Build America 
        Bonds Trust Account shall be available to the Transportation 
        Finance Corporation to pay the costs of any qualified project.
            ``(5) Applicability of federal law.--The requirements of 
        any Federal law, including titles 23, 40, and 49 of the United 
        States Code, which would otherwise apply to projects to which 
        the United States is a party or to funds made available under 
        such law and projects assisted with those funds shall apply 
        to--
                    ``(A) funds made available under the Build America 
                Bonds Trust Account for similar qualified projects, 
                including contributions required under subsection (h), 
                and
                    ``(B) similar qualified projects assisted by the 
                Transportation Finance Corporation through the use of 
                such funds.
            ``(6) Investment.--Subject to subsections (e) and (f), it 
        shall be the duty of the Transportation Finance Corporation to 
        invest in investment grade obligations such portion of the 
        Build America Bonds Trust Account as is not, in the judgment of 
        the Board of Directors of the Transportation Finance 
        Corporation, required to meet current withdrawals. To the 
        maximum extent practicable, investments should be made in 
        securities that support infrastructure investment at the State 
        and local level.
    ``(h) State Contribution Requirements.--
            ``(1) In general.--For purposes of subsection (a)(4), the 
        State contribution requirement of this subsection is met with 
        respect to any qualified project if the Transportation Finance 
        Corporation has received from 1 or more States, not later than 
        the date of issuance of the bond, written commitments for 
        matching contributions of not less than 20 percent (or such 
        smaller percentage as determined under title 23, United States 
        Code, for such State) of the cost of the qualified project.
            ``(2) State matching contributions may not include federal 
        funds.--For purposes of this subsection, State matching 
        contributions shall not be derived, directly or indirectly, 
        from Federal funds, including any transfers from the Highway 
        Trust Fund under section 9503.
    ``(i) Utilization of Updated Construction Technology for Qualified 
Projects.--For purposes of subsection (a)(5), the requirement of this 
subsection is met if the appropriate State agency relating to the 
qualified project is utilizing updated construction technologies.
    ``(j) Other Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Transportation finance corporation.--The term 
        `Transportation Finance Corporation' means the corporation 
        established under section 4(a) of the Build America Bonds Act 
        of 2009.
            ``(2) Credits may be transferred.--Nothing in any law or 
        rule of law shall be construed to limit the transferability of 
        the credit or bond allowed by this section through sale and 
        repurchase agreements.
            ``(3) Prohibition on use of highway trust fund.--
        Notwithstanding any other provision of law, no funds derived 
        from the Highway Trust Fund established under section 9503 
        shall be used to pay for credits under this section or for the 
        administrative costs of the Transportation Finance 
        Corporation.''.
    (b) Conforming Amendments.--
            (1) Paragraph (1) of section 54A(d) of the Internal Revenue 
        Code of 1986 is amended--
                    (A) by striking ``or'' at the end of subparagraph 
                (C),
                    (B) by inserting ``or'' at the end of subparagraph 
                (D),
                    (C) by inserting after subparagraph (D) the 
                following new subparagraph:
                    ``(E) a Build America bond,'', and
                    (D) by inserting ``(paragraphs (3), (4), and (6), 
                in the case of a Build America bond)'' after ``and 
                (6)''.
            (2) Subparagraph (C) of section 54A(d)(2) of such Code is 
        amended by striking ``and'' at the end of clause (iii), by 
        striking the period at the end of clause (iv) and inserting ``, 
        and'', and by adding at the end the following new clause:
                            ``(v) in the case of a Build America bond, 
                        a purpose specified in section 54F(a)(1).''.
    (c) Clerical Amendment.--The table of sections for subpart I of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new item:

``Sec. 54F. Build America bonds.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to bonds issued after the date of the enactment of this Act.

SEC. 4. TRANSPORTATION FINANCE CORPORATION.

    (a) Recognition and Status.--Congress grants consent and 
recognition to the establishment by 2 or more State infrastructure 
banks (established under section 610 of title 23, United States Code) 
of a multistate organization to be known as the ``Transportation 
Finance Corporation'' (hereafter in this section referred to as the 
``Corporation''). Additional State infrastructure banks may join the 
Transportation Finance Corporation subsequent to its establishment.
    (b) Functions of Corporation.--The Corporation--
            (1) is authorized to issue Build America bonds for the 
        financing of qualified projects as required under section 54F 
        of the Internal Revenue Code of 1986,
            (2) is authorized to establish and operate the Build 
        America Bonds Trust Account as required under section 54F(g) of 
        such Code,
            (3) is authorized to act as a centralized entity to provide 
        financing for qualified projects (as defined in section 54F(b) 
        of such Code),
            (4) may--
                    (A) leverage resources and stimulate public and 
                private investment in transportation infrastructure,
                    (B) encourage States to create additional 
                opportunities for the financing of transportation 
                infrastructure,
                    (C) perform any other function the sole purpose of 
                which is to carry out the financing of qualified 
                projects through Build America bonds, and
            (5) not later than February 15 of each year shall submit a 
        report to Congress describing the activities of the Corporation 
        for the preceding year.
    (c) Exemption From Taxes.--
            (1) In general.--The Corporation, including its franchise, 
        capital, reserves, surplus, sinking funds, mortgages or other 
        security holdings, and income, shall be exempt from all 
        taxation now or hereafter imposed by the United States, by any 
        territory, dependency, or possession thereof, or by any State, 
        county, municipality, or local taxing authority, except that 
        any real property of the Corporation shall be subject to State, 
        territorial, county, municipal, or local taxation to the same 
        extent according to its value as other real property is taxed.
            (2) Financial obligations.--Build America bonds or other 
        obligations issued by the Corporation and the interest on or 
        tax credits with respect to its bonds or other obligations 
        shall not be subject to taxation by any State, county, 
        municipality, or local taxing authority.
    (d) Construction Regarding Recognition and Status.--
            (1) In general.--Nothing in this section shall be construed 
        to establish the Corporation as a department, agency, or 
        instrumentality of the United States Government, to establish 
        the members of any governing board or the officers and 
        employees of the Corporation, as officers or employees of the 
        United States Government, or to subject the Corporation to the 
        provisions of title 31, United States Code.
            (2) United states not obligated.--The deposit of Federal 
        funds into the Build America Bonds Trust Account established 
        under section 54F(g) of the Internal Revenue Code of 1986 shall 
        not be construed as a commitment, guarantee, or obligation on 
        the part of the United States to any third party, nor shall any 
        third party have any right against the United States for 
        payment solely by virtue of the contribution. Any security or 
        debt-financing instrument issued by the Corporation shall 
        expressly state that the security or instrument does not 
        constitute a commitment, guarantee, or obligation of the United 
        States.

SEC. 5. ADDITIONAL REVENUES THROUGH EXTENSION OF CUSTOMS USER FEES.

    Section 13031(j)(3) of the Consolidated Omnibus Budget 
Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)) is amended--
            (1) by striking ``February 14, 2018'' in subparagraph (A) 
        and inserting ``February 14, 2046'', and
            (2) by striking ``January 31, 2018'' in subparagraph (B)(i) 
        and inserting ``January 31, 2046''.
                                 <all>
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