I 

113TH CONGRESS 

1ST SESSION H. R. 789 

To amend the Internal Revenue Code of 1986 to permanently extend the 

tax treatment for certain build America bonds, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 15, 2013 

Mr. NEAL (for himself, Mr. LEVIN, Mr. RANGEL, Mr. MCDERMOTT, Mr. 

LEWIS, Mr. BECERRA, Mr. THOMPSON of California, Mr. LARSON of Connecticut, Mr. BLUMENAUER, Mr. KIND, Mr. PASCRELL, Mr. CROWLEY, 

Ms. SCHWARTZ, Mr. DANNY K. DAVIS of Illinois, and Ms. LINDA T. 

SA ́NCHEZ of California) introduced the following bill; which was referred 

to the Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to permanently 

extend the tax treatment for certain build America 

bonds, and for other purposes. 

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 ‘‘Build America Bonds 

5 Act of 2013’’. 

6 SEC. 2. BUILD AMERICA BONDS MADE PERMANENT. 

7 (a) IN GENERAL.—Subparagraph (B) of section 

8 54AA(d)(1) of the Internal Revenue Code of 1986 is 


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1 amended by inserting ‘‘or during a period beginning on 

2 or after the date of the enactment of the Build America 

3 Bonds Act of 2013,’’ after ‘‘January 1, 2011,’’. 

4 (b) REDUCTION IN CREDIT PERCENTAGE TO BOND5 HOLDERS.—Subsection (b) of section 54AA of such Code 

6 is amended to read as follows: 

7 ‘‘(b) AMOUNT OF CREDIT.— 

8 ‘‘(1) IN GENERAL.—The amount of the credit 

9 determined under this subsection with respect to any 

10 interest payment date for a build America bond is 

11 the applicable percentage of the amount of interest 

12 payable by the issuer with respect to such date. 

13 ‘‘(2) APPLICABLE PERCENTAGE.—For purposes 

14 of paragraph (1), the applicable percentage shall be 

15 determined under the following table: 

‘‘In the case of a bond issued The applicable 

during calendar year: percentage is: 

2009 or 2010 ..................................................................................... 35

2013 ................................................................................................... 32

2014 ................................................................................................... 31

2015 ................................................................................................... 30

2016 ................................................................................................... 29

2017 and thereafter ........................................................................... 28.’’. 

16 (c) EXTENSION OF PAYMENTS TO ISSUERS.— 

17 (1) IN GENERAL.—Section 6431 of such Code 

18 is amended— 

19 (A) by inserting ‘‘or during a period begin20 ning on or after the date of the enactment of 


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1 the Build America Bonds Act of 2013,’’ after 

2 ‘‘January 1, 2011,’’ in subsection (a), and 

3 (B) by striking ‘‘before January 1, 2011’’ 

4 in subsection (f)(1)(B) and inserting ‘‘during a 

5 particular period’’. 

6 (2) CONFORMING AMENDMENTS.—Subsection 

7 (g) of section 54AA of such Code is amended— 

8 (A) by inserting ‘‘or during a period begin9 ning on or after the date of the enactment of 

10 the Build America Bonds Act of 2013,’’ after 

11 ‘‘January 1, 2011,’’, and 

12 (B) by striking ‘‘QUALIFIED BONDS

13 ISSUED BEFORE 2011’’ in the heading and in14 serting ‘‘CERTAIN QUALIFIED BONDS’’. 

15 (d) REDUCTION IN PERCENTAGE OF PAYMENTS TO

16 ISSUERS.—Subsection (b) of section 6431 of such Code 

17 is amended— 

18 (1) by striking ‘‘The Secretary’’ and inserting 

19 the following: 

20 ‘‘(1) IN GENERAL.—The Secretary’’, 

21 (2) by striking ‘‘35 percent’’ and inserting ‘‘the 

22 applicable percentage’’, and 

23 (3) by adding at the end the following new 

24 paragraph: 


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1 ‘‘(2) APPLICABLE PERCENTAGE.—For purposes 

2 of this subsection, the term ‘applicable percentage’ 

3 means the percentage determined in accordance with 

4 the following table: 

‘‘In the case of a qualified bond The applicable 

issued during calendar year: percentage is: 

2009 or 2010 ..................................................................................... 35

2013 ................................................................................................... 32

2014 ................................................................................................... 31

2015 ................................................................................................... 30

2016 ................................................................................................... 29

2017 and thereafter ........................................................................... 28.’’. 

5 (e) CURRENT REFUNDINGS PERMITTED.—Sub6 section (g) of section 54AA of such Code is amended by 

7 adding at the end the following new paragraph: 

8 ‘‘(3) TREATMENT OF CURRENT REFUNDING

9 BONDS.— 

10 ‘‘(A) IN GENERAL.—For purposes of this 

11 subsection, the term ‘qualified bond’ includes 

12 any bond (or series of bonds) issued to refund 

13 a qualified bond if— 

14 ‘‘(i) the average maturity date of the 

15 issue of which the refunding bond is a part 

16 is not later than the average maturity date 

17 of the bonds to be refunded by such issue, 

18 ‘‘(ii) the amount of the refunding 

19 bond does not exceed the outstanding 

20 amount of the refunded bond, and 


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1 ‘‘(iii) the refunded bond is redeemed 

2 not later than 90 days after the date of the 

3 issuance of the refunding bond. 

4 ‘‘(B) APPLICABLE PERCENTAGE.—In the 

5 case of a refunding bond referred to in subpara6 graph (A), the applicable percentage with re7 spect to such bond under section 6431(b) shall 

8 be the lowest percentage specified in paragraph 

9 (2) of such section. 

10 ‘‘(C) DETERMINATION OF AVERAGE MATU11 RITY.—For purposes of subparagraph (A)(i), 

12 average maturity shall be determined in accord13 ance with section 147(b)(2)(A). 

14 ‘‘(D) ISSUANCE RESTRICTION NOT APPLI15 CABLE.—Subsection (d)(1)(B) shall not apply 

16 to a refunding bond referred to in subpara17 graph (A).’’. 

18 (f) CLARIFICATION RELATED TO LEVEES AND

19 FLOOD CONTROL PROJECTS.—Subparagraph (A) of sec20 tion 54AA(g)(2) of such Code is amended by inserting 

21 ‘‘(including capital expenditures for levees and other flood 

22 control projects)’’ after ‘‘capital expenditures’’. 

23 (g) GROSS-UP OF PAYMENT TO ISSUERS IN CASE OF

24 SEQUESTRATION.—In the case of any payment under sec25 tion 6431(b) of the Internal Revenue Code of 1986 made 


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1 after the date of the enactment of this Act to which se2 questration applies, the amount of such payment shall be 

3 increased to an amount equal to— 

4 (1) such payment (determined before such se5 questration), multiplied by 

6 (2) the quotient obtained by dividing 1 by the 

7 amount by which 1 exceeds the percentage reduction 

8 in such payment pursuant to such sequestration. 

9 For purposes of this subsection, the term ‘‘sequestration’’ 

10 means any reduction in direct spending ordered in accord11 ance with a sequestration report prepared by the Director 

12 of the Office and Management and Budget pursuant to 

13 the Balanced Budget and Emergency Deficit Control Act 

14 of 1985 or the Statutory Pay-As-You-Go Act of 2010. 

15 (h) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to obligations issued on or after 

17 the date of the enactment of this Act. 

Æ 


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