I 

115TH CONGRESS 

1ST SESSION H. R. 1080 

To amend the Securities Act of 1933 and the Internal Revenue Code of 

1986 to provide an exemption and payments from taxation for 501(c)(3) 

bonds issued on behalf of a historically Black college or university. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 15, 2017 

Mr. ELLISON (for himself, Mr. SCOTT of Virginia, Ms. ADAMS, Mr. CONYERS, 

Ms. LEE, Mr. PAYNE, and Ms. MOORE) introduced the following bill; 

which was referred to the Committee on Ways and Means, and in addition to the Committee on Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such 

provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend the Securities Act of 1933 and the Internal Revenue Code of 1986 to provide an exemption and payments from taxation for 501(c)(3) bonds issued on behalf 

of a historically Black college or university. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘HBCU Investment Ex5 pansion Act’’. 


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1 SEC. 2. TAX EXEMPTION FOR HBCU BONDS. 

2 The Securities Act of 1933 (15 U.S.C. 77aa et seq.) 

3 is amended by inserting after section 28 the following: 

4 ‘‘SEC. 29. TAX EXEMPTION FOR HBCU BONDS. 

5 ‘‘(a) IN GENERAL.—A qualified 501(c)(3) bond (as 

6 defined in section 145 of the Internal Revenue Code of 

7 1986) issued after the date of the enactment of the HBCU 

8 Investment Expansion Act on behalf of a historically 

9 Black college or university shall be exempt from taxation 

10 by any State, Territory, or possession, or by any county, 

11 municipality, or other municipal subdivision of any State, 

12 territory, or possession of the United States, or by the 

13 District of Columbia. 

14 ‘‘(b) HISTORICALLY BLACK COLLEGE OR UNIVER15 SITY DEFINED.—For purposes of this section, the term 

16 ‘historically Black college or university’ means a part B 

17 institution (as defined in section 322(2) of the Higher 

18 Education Act of 1965 (20 U.S.C. 1061(2)).’’. 

19 SEC. 3. CREDIT WITH RESPECT TO 501(c)(3) BONDS ISSUED 

20 ON BEHALF OF HISTORICALLY BLACK COL21 LEGES AND UNIVERSITIES. 

22 (a) IN GENERAL.—Subchapter B of chapter 65 of the 

23 Internal Revenue Code of 1986 is amended by adding at 

24 the end the following: 


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1 ‘‘SEC. 6433. CREDIT WITH RESPECT TO 501(c)(3) BONDS 

2 ISSUED ON BEHALF OF HISTORICALLY 

3 BLACK COLLEGES AND UNIVERSITIES. 

4 ‘‘(a) IN GENERAL.—In the case of a qualified bond 

5 issued after the date of the enactment of the HBCU In6 vestment Expansion Act, a credit shall be allowed to a ju7 risdiction specified in subsection (c)(3) that forgoes tax 

8 pursuant to section 29 of the Securities Act of 1933 with 

9 respect to each interest payment under such bond. The 

10 credit shall be payable by the Secretary as provided in sub11 section (b). 

12 ‘‘(b) PAYMENT OF CREDIT.—The Secretary shall pay 

13 (as soon as practicable after the return of income tax for 

14 a taxable year is filed with the qualified jurisdiction by 

15 the recipient of such interest payment under such bond) 

16 an amount equal to the total amount of interest paid 

17 under such bond during the taxable year. 

18 ‘‘(c) DEFINITIONS.—For purposes of this section— 

19 ‘‘(1) QUALIFIED BOND.—The term ‘qualified 

20 bond’ means a qualified 501(c)(3) bond (as defined 

21 in section 145) issued on behalf of a historically 

22 Black college or university. 

23 ‘‘(2) HISTORICALLY BLACK COLLEGE OR UNI24 VERSITY.—The term ‘historically Black college or 

25 university’ means a part B institution (as defined in 


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1 section 322(2) of the Higher Education Act of 1965 

2 (20 U.S.C. 1061(2)). 

3 ‘‘(3) JURISDICTION SPECIFIED.—A jurisdiction 

4 is specified in this paragraph if the jurisdiction is— 

5 ‘‘(A) a State, territory, or possession of the 

6 United States, 

7 ‘‘(B) a political jurisdiction of a State, ter8 ritory, or possession of the United States, or 

9 ‘‘(C) the District of Columbia. 

10 ‘‘(d) APPLICATION OF ARBITRAGE RULES.—For pur11 poses of section 148, the yield on a qualified bond shall 

12 be reduced by the credit allowed under this section. 

13 ‘‘(e) REGULATIONS.—The Secretary shall issue such 

14 regulations or other guidance as may be necessary to carry 

15 out this section.’’. 

16 (b) CONFORMING AMENDMENTS.— 

17 (1) Section 1324(b)(2) of title 31, United 

18 States Code, is amended by striking ‘‘or 6431’’ and 

19 inserting ‘‘6431, or 6433’’. 

20 (2) Section 6211(b)(4)(A) of the Internal Rev21 enue Code of 1986 is amended by striking ‘‘and 

22 6431’’ and inserting ‘‘6431, and 6433’’. 

23 (3) The table of sections for subchapter B of 

24 chapter 65 of the Internal Revenue Code of 1986 is 


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1 amended by adding at the end the following new 

2 item: 

‘‘Sec. 6433. Credit with respect to 501(c)(3) bonds issued on behalf of historically Black colleges and universities.’’. 

3 (c) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to bonds issued after the date of 

5 the enactment of this Act. 

Æ 


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