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112TH CONGRESS 

1ST SESSION H. R. 278 

To amend the Internal Revenue Code of 1986 to provide for tax exempt 

qualified small issue bonds to finance agricultural processing property. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 12, 2011 

Mr. FORTENBERRY 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 provide 

for tax exempt qualified small issue bonds to finance 

agricultural processing property. 

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

3 SECTION 1. QUALIFIED SMALL ISSUE BONDS FOR AGRICUL4 TURAL PROCESSING PROPERTY. 

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

6 144(a)(12) of the Internal Revenue Code of 1986 is 

7 amended by striking ‘‘or’’ at the end of clause (i), by re8 designating clause (ii) as clause (iii), and by inserting 

9 after clause (i) the following new clause: 


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HR 278 IH1S 

1 ‘‘(ii) any agricultural processing prop2 erty, or’’. 

3 (b) AGRICULTURAL PROCESSING PROPERTY.—Para4 graph (12) of section 144(a) of such Code is amended by 

5 adding at the end the following new subparagraph: 

6 ‘‘(D) AGRICULTURAL PROCESSING PROP7 ERTY.— 

8 ‘‘(i) IN GENERAL.—For purposes of 

9 this paragraph, the term ‘agricultural 

10 processing property’ means any depreciable 

11 property or land, which is used primarily 

12 for the processing of agricultural products. 

13 ‘‘(ii) PROCESSING.—For purposes of 

14 this subparagraph, the term ‘processing’ 

15 includes pasteurizing, slaughtering, wash16 ing, peeling, cutting, freezing, preserving, 

17 and packaging. Such term does not include 

18 planting, raising, harvesting, gathering, 

19 breeding, feeding, or milking. 

20 ‘‘(iii) AGRICULTURAL PRODUCTS.— 

21 For purposes of this subparagraph, the 

22 term ‘agricultural products’ includes plant 

23 and dairy products, meats, fish, and poul24 try.’’. 


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HR 278 IH1S 

1 (c) EXCEPTION TO LIMITATION ON ACQUISITION OF

2 DEPRECIABLE FARM PROPERTY.—Subparagraph (B) of 

3 section 144(a)(11) of such Code is amended by inserting 

4 ‘‘(other than agricultural processing property, as defined 

5 in paragraph (12)(D))’’ after ‘‘means property’’. 

6 (d) EXCEPTION TO PROHIBITION ON ACQUISITION OF

7 LAND FOR FARMING PURPOSES.—Subsection (c) of sec8 tion 147 of such Code is amended by adding at the end 

9 the following new paragraph: 

10 ‘‘(4) EXCEPTION FOR AGRICULTURAL PROC11 ESSING PROPERTY.—Paragraph (1)(B) shall not 

12 apply with respect to any agricultural processing 

13 property (as defined in section 144(a)(12)(D)).’’. 

14 (e) EXCEPTION TO PROHIBITION ON ACQUISITION OF

15 EXISTING PROPERTY.—Subsection (d) of section 147 of 

16 such Code is amended by adding at the end the following 

17 new paragraph: 

18 ‘‘(5) EXCEPTION FOR AGRICULTURAL PROC19 ESSING PROPERTY.—Paragraph (1) shall not apply 

20 with respect to any agricultural processing property 

21 (as defined in section 144(a)(12)(D)).’’. 

22 (f) EFFECTIVE DATE.—The amendments made by 

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

24 the enactment of this Act. 

Æ 


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