II 

109TH CONGRESS 

2D SESSION S. 3782 

To amend the Internal Revenue Code of 1986 to provide a credit against 

the income tax for expenses incurred in any hurricane or flood protection 

project. 

IN THE SENATE OF THE UNITED STATES 

AUGUST 3, 2006 

Mr. VITTER introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to provide 

a credit against the income tax for expenses incurred 

in any hurricane or flood protection project. 

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 ‘‘Hurricane and Flood 

5 Protection Tax Credit Act’’. 

6 SEC. 2. CREDIT FOR EXPENSES INCURRED IN HURRICANE 

7 OR FLOOD PROTECTION PROJECTS. 

8 (a) IN GENERAL.—Subpart B of part IV of sub9 chapter A of chapter 1 of the Internal Revenue Code of 


hmoore on PROD1PC68 with HMBILLS
2 

•S 3782 IS

1 1986 is amended by adding at the end the following new 

2 section: 

3 ‘‘SEC. 30D. CREDIT FOR EXPENSES INCURRED IN HURRI4 CANE OR FLOOD PROTECTION PROJECTS. 

5 ‘‘(a) ALLOWANCE OF CREDIT.—There shall be al6 lowed as a credit against the tax imposed by this chapter 

7 for the taxable year an amount equal to 30 percent of the 

8 qualified expenditures of the taxpayer for the taxable year. 

9 ‘‘(b) LIMITATION BASED ON AMOUNT OF TAX.—The 

10 credit allowed under subsection (a) for the taxable year 

11 shall not exceed the excess of— 

12 ‘‘(1) the sum of the regular tax liability (as de13 fined in section 26(b)) plus the tax imposed by sec14 tion 55, over 

15 ‘‘(2) the sum of the credits allowable under sub16 part A and sections 27 and 30A for the taxable 

17 year. 

18 ‘‘(c) QUALIFIED EXPENDITURES.—For purposes of 

19 this section— 

20 ‘‘(1) IN GENERAL.—The term ‘qualified expend21 itures’ means amounts paid or incurred by the tax22 payer for an unfunded authorized project, but only 

23 to the extent— 

24 ‘‘(A) such amounts are paid or incurred 

25 after a request by the taxpayer to expend such 


hmoore on PROD1PC68 with HMBILLS
3 

•S 3782 IS

1 amounts has been approved by the Federal 

2 agency administering the unfunded authorized 

3 project or after a 90-day period following such 

4 request (plus an additional 30-day period if re5 quested by such agency within the 90-day pe6 riod) during which no decision regarding such 

7 request is made by such agency, and 

8 ‘‘(B) such amounts are applied proportion9 ally to the Federal and non-Federal share of 

10 the total amount authorized to be appropriated 

11 for such project. 

12 ‘‘(2) UNFUNDED AUTHORIZED PROJECT.—The 

13 term ‘unfunded authorized project’ means any 

14 project— 

15 ‘‘(A) authorized by Federal law to provide 

16 hurricane or flood protection in the United 

17 States, and 

18 ‘‘(B) with respect to which no or only par19 tial Federal funding has been appropriated 

20 prior to the request described in paragraph 

21 (1)(A). 

22 ‘‘(d) CARRYOVERS ALLOWED.— 

23 ‘‘(1) IN GENERAL.—If the credit amount allow24 able under subsection (a) for a taxable year exceeds 

25 the amount of the limitation under subsection (b) 


hmoore on PROD1PC68 with HMBILLS
4 

•S 3782 IS

1 for such taxable year (referred to as the ‘unused 

2 credit year’ in this paragraph), such excess shall be 

3 allowed as a credit carryforward for each of the tax4 able years following the unused credit year or as a 

5 credit carryback for each of the taxable years pre6 ceding the unused credit year. 

7 ‘‘(2) RULES.—For purposes of paragraph (1), 

8 rules similar to the rules of section 39 shall apply, 

9 except that— 

10 ‘‘(A) subsection (a)(1) shall be applied— 

11 ‘‘(i) by substituting ‘3 taxable years’ 

12 for ‘1 taxable years’ in subparagraph (A) 

13 thereof, and 

14 ‘‘(ii) by substituting ‘5 taxable years’ 

15 for ‘20 taxable years’ in subparagraph (B) 

16 thereof, and 

17 ‘‘(B) subsection (a)(2) shall be applied— 

18 ‘‘(i) by substituting ‘8 taxable years’ 

19 for ‘21 taxable years’ in subparagraph (A) 

20 thereof, and 

21 ‘‘(ii) by substituting ‘7 taxable years’ 

22 for ‘20 taxable years’ in subparagraph (B). 

23 ‘‘(e) SPECIAL RULES.— 

24 ‘‘(1) BASIS REDUCTION.—The basis of any 

25 property for which a credit is allowable under subVerDate Aug 31 2005 05:09 Aug 05, 2006 Jkt 049200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S3782.IS S3782

hmoore on PROD1PC68 with HMBILLS
5 

•S 3782 IS

1 section (a) shall be reduced by the amount of such 

2 credit (determined without regard to subsection (b)). 

3 ‘‘(2) NO DOUBLE BENEFIT.—The amount of 

4 any deduction or credit allowable under this chapter 

5 (other than the credit allowable under subsection 

6 (a)), shall be reduced by the amount of credit al7 lowed under subsection (a) (determined without re8 gard to subsection (b)) for the taxable year. 

9 ‘‘(3) REDUCTION FOR ASSISTANCE.—The 

10 amount taken into account under subsection (a) with 

11 respect to any project shall be reduced by the 

12 amount of any Federal, State, or local grant or 

13 other assistance received by the taxpayer during 

14 such taxable year or any prior taxable year which 

15 was used to make qualified expenditures and which 

16 was not included in the gross income of such tax17 payer.’’. 

18 (b) BASIS ADJUSTMENT.—Section 1016(a) of the In19 ternal Revenue Code of 1986 is amended by striking 

20 ‘‘and’’ at the end of paragraph (36), by striking the period 

21 at the end of paragraph (37) and inserting ‘‘, and’’, and 

22 by adding at the end the following new paragraph: 

23 ‘‘(38) to the extent provided in section 

24 30D(e)(1).’’. 


hmoore on PROD1PC68 with HMBILLS
6 

•S 3782 IS

1 (c) CLERICAL AMENDMENT.—The table of sections 

2 for subpart B of part IV of subchapter A of chapter 1 

3 of such Code is amended by inserting after the item relat4 ing to section 30A the following new item: 

‘‘Sec. 3DB. Credit for expenses incurred in hurricane or flood protection 

projects.’’. 

5 (d) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply to taxable years beginning after 

7 December 31, 2005. 

Æ 


hmoore on PROD1PC68 with HMBILLS