66304 Federal Register / Vol. 66, No. 247 / Wednesday, December 26, 2001 / Rules and Regulations

unit load device (ULD), in accordance with

a method approved by the Manager, Los

Angeles ACO. If any vertical side restraint

does not provide the required support,

within 3 years or 4,000 flight cycles after the

effective date of this AD, whichever occurs

first, modify the vertical side restraint to

provide the support appropriate to the ULD’s

compatible with the cargo handling system,

in accordance with a method approved by

the Manager, Los Angeles ACO.

(c) For airplanes that have been converted

from a passenger- to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC ST00309AT: Within 3 years or

4,000 flight cycles after the effective date of

this AD, whichever occurs first, modify the

main deck cargo floor to safely carry the

applicable FAA-approved payload limits

above and below the main deck cargo floor.

The modification and payload distribution

shall be accomplished in accordance with a

method approved by the Manager, Los

Angeles ACO. The modification must comply

with the applicable requirements of CAR part

4b for the FAA-approved payload

distribution.

(d) For airplanes that have been converted

from a passenger- to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC ST00309AT, except for those

airplanes that have been modified in

accordance with paragraph (c) of this AD:

Within 1 year or 1,000 flight cycles after the

effective date of this AD, whichever occurs

first, perform an inspection and evaluation of

the venting system of the main deck cargo

floor to determine if the system limits

decompression loads to a level that can be

carried by the floor structure without failure,

in accordance with a method approved by

the Manager, Los Angeles ACO.

(e) If, based on the evaluation required by

paragraph (d) of this AD, the venting system

does not limit decompression loads to a level

that can be carried by the floor structure

without failure, within 3 years or 4,000 flight

cycles after the effective date of this AD,

whichever occurs first, modify the venting

system, as necessary, to limit the

decompression loads to a level that can be

supported successfully by the existing floor

structure, in accordance with a method

approved by the Manager, Los Angeles ACO.

Actions Addressing Main Deck Cargo 9g

Crash Barrier

(f) For airplanes that have been converted

from a passenger to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC ST00309AT: Within 3 years or

4,000 flight cycles after the effective date of

this AD, whichever occurs first, install a

main deck cargo 9g crash barrier that

complies with the applicable requirements of

CAR part 4b, in accordance with a method

approved by the Manager, Los Angeles ACO.

Alternative Methods of Compliance

(g) An alternative method of compliance or

adjustment of the compliance time that

provides an acceptable level of safety may be

used if approved by the Manager, Los

Angeles ACO. Operators shall submit their

requests through an appropriate FAA

Principal Maintenance Inspector, who may

add comments and then send it to the

Manager, Los Angeles ACO.

Note 2: Information concerning the

existence of approved alternative methods of

compliance with this AD, if any, may be

obtained from the Los Angeles ACO.

Special Flight Permit

(h) Special flight permits may be issued in

accordance with sections 21.197 and 21.199

of the Federal Aviation Regulations (14 CFR

21.197 and 21.199) to operate the airplane to

a location where the requirements of this AD

can be accomplished.

Effective Date

(i) This amendment becomes effective on

January 30, 2002.

Issued in Renton, Washington, on

December 13, 2001.

Kalene C. Yanamura,

Acting Manager, Transport Airplane

Directorate, Aircraft Certification Service.

[FR Doc. 01–31551 Filed 12–21–01; 8:45 am]

BILLING CODE 4910–13–U

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. 2000–NM–280–AD; Amendment

39–12565; AD 2001–26–01]

RIN 2120–AA64

Airworthiness Directives; McDonnell

Douglas Model DC–8 Series Airplanes

AGENCY: Federal Aviation

Administration, DOT.

ACTION: Final rule.

SUMMARY: This amendment adopts a

new airworthiness directive (AD),

applicable to certain McDonnell

Douglas Model DC–8 series airplanes

that have been converted from a

passenger-to a cargo-carrying

(‘‘freighter’’) configuration. This

amendment requires, among other

actions, modification of the main deck

cargo door structure and fuselage

structure; modification of a main deck

cargo door hinge; modification of the

main deck cargo floor; and installation

of a main deck cargo 9g crash barrier; as

applicable. The actions specified by this

AD are intended to prevent opening of

the cargo door while the airplane is in

flight or collapse of the main deck cargo

floor, and consequent rapid

decompression of the airplane including

possible loss of flight control or severe

structural damage. These actions are

intended to address the identified

unsafe condition.

DATES: Effective January 30, 2002.

ADDRESSES: Information pertaining to

this amendment may be examined at the

Federal Aviation Administration (FAA),

Transport Airplane Directorate, Rules

Docket, 1601 Lind Avenue, SW.,

Renton, Washington; or at the FAA, Los

Angeles Aircraft Certification Office,

3960 Paramount Boulevard, Lakewood,

California.

FOR FURTHER INFORMATION CONTACT:

Michael E. O’Neil, Aerospace Engineer,

Airframe Branch, ANM–120L, FAA, Los

Angeles Aircraft Certification Office,

3960 Paramount Boulevard, Lakewood,

California 90712–4137; telephone (562)

627–5320; fax (562) 627–5210.

SUPPLEMENTARY INFORMATION: A

proposal to amend part 39 of the Federal

Aviation Regulations (14 CFR part 39) to

include an airworthiness directive (AD)

that is applicable to certain McDonnell

Douglas Model DC–8 series airplanes

that have been converted from a

passenger-to a cargo-carrying

(‘‘freighter’’) configuration was

published in the Federal Register on

September 27, 2000 (65 FR 58185). That

action proposed to require, among other

actions, modification of the main deck

cargo door structure and fuselage

structure; modification of a main deck

cargo door hinge; modification of the

main deck cargo floor; and installation

of a main deck cargo 9g crash barrier; as

applicable.

Comments

Interested persons have been afforded

an opportunity to participate in the

making of this amendment. No

comments were submitted in response

to the proposal or the FAA’s

determination of the cost to the public.

However, the FAA did receive

comments in response to notice of

proposed rulemaking (NPRM), Rules

Docket 2000–NM–283–AD. Because

certain issues raised by the commenter

are generally relevant to this AD, those

comments are discussed below.

Request To Revise Compliance Times

One commenter requests that the

compliance times specified in paragraph

(b) of the proposed be revised from

‘‘Within 2 years or 2,000 flight cycles

after the effective date of this AD,

whichever occurs first’’ to ‘‘within 3

years or 4,000 flight cycles after the

effective date of this AD, whichever

occurs first.’’ The commenter contends

that if the inspection and evaluation

required by that paragraph reveals a

discrepancy, the corrective modification

will be extensive. The commenter states

that such an extension would allow

operators to correct discrepancies at one

maintenance visit, and thus, minimize

airplane downtime.

The FAA agrees. Since issuance of the

NPRM, we have gained a better

Federal Register / Vol. 66, No. 247 / Wednesday, December 26, 2001 / Rules and Regulations 66305

understanding of the design feature of

the original modification relative to the

vertical side restraint installation and

decompression venting. We have

determined that the structure is

sufficiently robust, and that

accomplishing the required inspection,

evaluation, and modification, if

necessary, required by paragraph (b) of

this AD ‘‘within 3 years or 4,000 flight

hours after the effective date of this AD,

whichever occurs first,’’ will provide an

acceptable level of safety. For the same

reasons, we also find that the 2-year

compliance time for the modification

required by paragraph (e) of this AD can

be extended to ‘‘within 3 years or 4,000

flight hours after the effective date of

this AD, whichever occurs first.’’

Therefore, we have revised the

compliance times of paragraphs (b) and

(e) of the final rule accordingly.

Request To Provide an Alternate Means

of Compliance

The commenter also requests that

paragraph (a)(2)(i) of the proposed AD

be revised to include an option that

states: ‘‘Main deck zone loading can be

limited as approved by manager LA

ACO in such a manner that no

modification is required for the main

deck floor structure. This will eliminate

the requirement for Alternate Means of

Compliance.’’ The commenter notes that

under the heading ‘‘3. Capability of the

Unmodified Floor’’ in the preamble of

the proposed AD, it states ‘‘It is also

possible to limit the main deck zone

loading to a level that the main deck

cargo floor can be supported safely

without modification.’’ The commenter

states that the analysis performed by the

DC–8 Cargo Conversion Joint Task Force

and FAA has shown that the main deck

floor modified per Supplemental Type

Certificate (STC) SA1862SO is capable

of carrying the zone loads equivalent to

Aeronavali modified airplanes.

The FAA consulted with the

commenter to clarify its reference to

paragraph (a)(2)(i) of the proposed AD.

The commenter meant to refer to

paragraph (c) of the proposed AD. We

do not agree with the commenter’s

request to revise paragraph (c) of the

final rule. We find that the option

suggested by the commenter would

require operators to obtain a separate

approval from the Manager of the Los

Angeles Aircraft Certification Office

(ACO). Adding the commenter’s

statement in the AD would not save us

or the operators any resources, because,

like the requirements of paragraph (c) of

this AD, it also would require operators

to submit a letter and substantiating

data to us for review. The difference

between the two letters would be in

name only (i.e., alternate method of

compliance vs. approved method of

compliance). Therefore, no change to

paragraph (c) of the final rule is

necessary.

Conclusion

After careful review of the available

data, including the comments noted

above, the FAA has determined that air

safety and the public interest require the

adoption of the rule with the changes

previously described. The FAA has

determined that these changes will

neither increase the economic burden

on any operator nor increase the scope

of the AD.

Cost Impact

There are approximately 15 Model

DC–8 series airplanes of the affected

design in the worldwide fleet. The FAA

estimates that 11 airplanes of U.S.

registry will be affected by this AD. The

following table shows the estimated cost

impact for airplanes affected by this AD.

The average labor rate is $60 per work

hour. The estimated maximum total cost

for all airplanes affected by this AD is

$2,192,520, or $199,320 per airplane.

STC Action Work hours

(estimated)

Parts cost

(estimated) Total cost (estimated)

SA1063SO ... Incorporation of inspections into maintenance

or inspection program.

8 N/A $5,280 or $480 per airplane.

SA1063SO ... Modification of main deck cargo door structure and fuselage structure.205 $700 $143,000, or $13,000 per airplane.

SA1063SO ... Inspection of exposed surfaces of main deck

cargo door hinge.

16 N/A $10,560, or $960 per airplane.

SA1063SO ... Inspection of mating surfaces of main deck

cargo door hinge.

16 N/A $10,560, or $960 per airplane.

SA1063SO ... Installation of a main deck cargo door hinge .. 60 $200 $41,800, or $3,800 per airplane.

SA1377SO ... Inspection and evaluation of the cargo handling system.16 N/A $10,560, or $960 per airplane.

SA1377SO ... Modification of main deck cargo floor ............. 120 $1,000 $90,200, or $8,200 per airplane.

SA1377SO ... Inspection and evaluation of the venting system.16 N/A $10,560, or $960 per airplane.

SA1377SO ... Installation of main deck cargo 9g crash barrier.2,000 $50,000 $1,870,000, or $170,000 per airplane.

The cost impact figures discussed

above are based on assumptions that no

operator has yet accomplished any of

the requirements of this AD action, and

that no operator would accomplish

those actions in the future if this AD

were not adopted. The cost impact

figures discussed in AD rulemaking

actions represent only the time

necessary to perform the specific actions

actually required by the AD. These

figures typically do not include

incidental costs, such as the time

required to gain access and close up,

planning time, or time necessitated by

other administrative actions.

Regulatory Impact

The regulations adopted herein will

not have a substantial direct effect on

the States, on the relationship between

the national Government and the States,

or on the distribution of power and

responsibilities among the various

levels of government. Therefore, it is

determined that this final rule does not

have federalism implications under

Executive Order 13132.

For the reasons discussed above, I

certify that this action (1) is not a

‘‘significant regulatory action’’ under

Executive Order 12866; (2) is not a

‘‘significant rule’’ under DOT

Regulatory Policies and Procedures (44

FR 11034, February 26, 1979); and (3)

will not have a significant economic

impact, positive or negative, on a

substantial number of small entities

under the criteria of the Regulatory

Flexibility Act. A final evaluation has

been prepared for this action and it is

contained in the Rules Docket. A copy

of it may be obtained from the Rules

66306 Federal Register / Vol. 66, No. 247 / Wednesday, December 26, 2001 / Rules and Regulations

Docket at the location provided under

the caption ADDRESSES.

List of Subjects in 14 CFR Part 39

Air transportation, Aircraft, Aviation

safety, Safety.

Adoption of the Amendment

Accordingly, pursuant to the

authority delegated to me by the

Administrator, the Federal Aviation

Administration amends part 39 of the

Federal Aviation Regulations (14 CFR

part 39) as follows:

PART 39—AIRWORTHINESS

DIRECTIVES

1. The authority citation for part 39

continues to read as follows:

Authority: 49 U.S.C. 106(g), 40113, 44701.

§ 39.13 [Amended]

2. Section 39.13 is amended by

adding the following new airworthiness

directive:

2001–26–01 McDonnell Douglas:

Amendment 39–12565. Docket 2000–

NM–280–AD.

Applicability: Model DC–8 series airplanes

that have been converted from a passengerto a cargo-carrying (‘‘freighter’’) configuration

in accordance with Supplemental Type

Certificates (STC) SA1063SO and SA1377SO;

certificated in any category.

Note 1: This AD applies to each airplane

identified in the preceding applicability

provision, regardless of whether it has been

otherwise modified, altered, or repaired in

the area subject to the requirements of this

AD. For airplanes that have been modified,

altered, or repaired so that the performance

of the requirements of this AD is affected, the

owner/operator must request approval for an

alternative method of compliance in

accordance with paragraph (i) of this AD. The

request should include an assessment of the

effect of the modification, alteration, or repair

on the unsafe condition addressed by this

AD; and, if the unsafe condition has not been

eliminated, the request should include

specific proposed actions to address it.

Compliance: Required as indicated, unless

accomplished previously.

To prevent opening of the cargo door while

the airplane is in flight or collapse of the

main deck cargo floor, and consequent rapid

decompression of the airplane including

possible loss of flight control or severe

structural damage, accomplish the following:

Actions Addressing the Main Deck Cargo

Door and Associated Fuselage Structure

(a) For airplanes that have been converted

from a passenger-to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC SA1063SO: Accomplish the actions

specified in paragraphs (a)(1) and (a)(2) of

this AD in accordance with a method

approved by the Manager, Los Angeles

Aircraft Certification Office (ACO), FAA.

(1) Within 1 year or 1,200 flight cycles after

the effective date of this AD, whichever

occurs first, incorporate inspections into the

operator’s FAA-approved maintenance or

inspection program that ensure the continued

operational safety of the airplane. These

inspections should be based on a damage

tolerance assessment that identifies any

principal structural element (PSE) associated

with the STC modification and should

include associated inspection thresholds,

inspection methods, and repetitive

inspection intervals.

(2) Within 3 years or 4,000 flight cycles

after the effective date of this AD, whichever

occurs first, accomplish the actions specified

in paragraphs (a)(2)(i) and (a)(2)(ii) of this

AD.

(i) Modify the main deck cargo door

structure and fuselage structure immediately

surrounding the main deck cargo door to

comply with the applicable requirements of

Civil Air Regulations (CAR) part 4b.

(ii) Incorporate inspections into the

operator’s FAA-approved maintenance or

inspection program that ensure the continued

operational safety of the airplane. These

inspections should be based on a damage

tolerance assessment that identifies any PSE

associated with the STC modification

required by paragraph (a)(2)(i) of this AD and

should include associated inspection

thresholds, inspection methods, and

repetitive inspection intervals.

Actions Addressing the Main Deck Cargo

Floor

(b) For airplanes that have been converted

from a passenger-to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC SA1377SO: Within 3 years or 4,000

flight cycles after the effective date of this

AD, whichever occurs first, perform an

inspection and evaluation of the cargo

handling system to determine if the side

restraints provide the support required by the

unit load device (ULD), in accordance with

a method approved by the Manager, Los

Angeles ACO. If any vertical side restraint

does not provide the required support,

within 3 years or 4,000 flight cycles after the

effective date of this AD, whichever occurs

first, modify the vertical side restraint to

provide the support appropriate to the ULD’s

compatible with the cargo handling system,

in accordance with a method approved by

the Manager, Los Angeles ACO.

(c) For airplanes that have been converted

from a passenger-to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC SA1377SO: Within 3 years or 4,000

flight cycles after the effective date of this

AD, whichever occurs first, modify the main

deck cargo floor to safely carry the applicable

FAA-approved payload limits above and

below the main deck cargo floor. The

modification and payload distribution shall

be accomplished in accordance with a

method approved by the Manager, Los

Angeles ACO. The modification must comply

with the applicable requirements of CAR part

4b for the FAA-approved payload

distribution.

(d) For airplanes that have been converted

from a passenger-to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC SA1377SO, except for those

airplanes that have been modified in

accordance with paragraph (c) of this AD:

Within 1 year or 1,000 flight cycles after the

effective date of this AD, whichever occurs

first, perform an inspection and evaluation of

the venting system of the main deck cargo

floor to determine if the system limits

decompression loads to a level that can be

carried by the floor structure without failure,

in accordance with a method approved by

the Manager, Los Angeles ACO.

(e) If, based on the evaluation required by

paragraph (d) of this AD, the venting system

does not limit decompression loads to a level

that can be carried by the floor structure

without failure, within 3 years or 4,000 flight

cycles after the effective date of this AD,

whichever occurs first, modify the venting

system, as necessary, to limit the

decompression loads to a level that can be

supported successfully by the existing floor

structure, in accordance with a method

approved by the Manager, Los Angeles ACO.

Actions Addressing Main Deck Cargo Door

Hinge

(f) For airplanes that have been converted

from a passenger- to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC SA1063SO: Within 250 flight

cycles after the effective date of this AD,

perform a detailed visual inspection to detect

cracks of the exposed surfaces of the main

deck cargo door hinge (both fuselage and

door side hinge elements), in accordance

with a method approved by the Manager, Los

Angeles ACO. If any crack is detected, prior

to further flight, repair in accordance with a

method approved by the Manager, Los

Angeles ACO, or replace the cracked hinge

element with a new, like part.

Note 2: For the purposes of this AD, a

detailed visual inspection is defined as: An

intensive visual examination of a specific

structural area, system, installation, or

assembly to detect damage, failure, or

irregularity. Available lighting is normally

supplemented with a direct source of good

lighting at intensity deemed appropriate by

the inspector. Inspection aids such as mirror,

magnifying lenses, etc., may be used. Surface

cleaning and elaborate access procedures

may be required.

(g) For airplanes that have been converted

from a passenger- to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC SA1063SO: Within 3 years or 4,000

flight cycles after the effective date of this

AD, whichever occurs first, accomplish the

actions specified in paragraphs (g)(1) and

(g)(2) of this AD in accordance with a method

approved by the Manager, Los Angeles ACO.

(1) Perform a detailed visual inspection to

detect cracks or other discrepancies (i.e.,

double or closely drilled holes, corrosion,

chips, scratches, or gouges) of the mating

surfaces of the main deck cargo door hinge,

skin of the main deck cargo door, and

external fuselage doubler underlying the

hinge. If any discrepancy is detected, prior to

further flight, repair the discrepant part.

(2) Install a main deck cargo door hinge

that complies with the applicable

requirements of CAR part 4b, including failsafe requirements.

Federal Register / Vol. 66, No. 247 / Wednesday, December 26, 2001 / Rules and Regulations 66307

Actions Addressing Main Deck Cargo 9g

Crash Barrier

(h) For airplanes that have been converted

from a passenger- to a cargo-carrying

(‘‘freighter’’) configuration in accordance

with STC SA1377SO: Within 3 years or 4,000

flight cycles after the effective date of this

AD, whichever occurs first, install a main

deck cargo 9g crash barrier that complies

with the applicable requirements of CAR part

4b, in accordance with a method approved by

the Manager, Los Angeles ACO.

Alternative Methods of Compliance

(i) An alternative method of compliance or

adjustment of the compliance time that

provides an acceptable level of safety may be

used if approved by the Manager, Los

Angeles ACO, FAA. Operators shall submit

their requests through an appropriate FAA

Principal Maintenance Inspector, who may

add comments and then send it to the

Manager, Los Angeles ACO.

Note 3: Information concerning the

existence of approved alternative methods of

compliance with this AD, if any, may be

obtained from the Los Angeles ACO.

Special Flight Permit

(j) Special flight permits may be issued in

accordance with sections 21.197 and 21.199

of the Federal Aviation Regulations (14 CFR

21.197 and 21.199) to operate the airplane to

a location where the requirements of this AD

can be accomplished.

Effective Date

(k) This amendment becomes effective on

January 30, 2002.

Issued in Renton, Washington, on

December 13, 2001.

Kalene C. Yanamura,

Acting Manager, Transport Airplane

Directorate, Aircraft Certification Service.

[FR Doc. 01–31550 Filed 12–21–01; 8:45 am]

BILLING CODE 4910–13–U

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Parts 1 and 602

[TD 8971]

RIN 1545–BA49

New Markets Tax Credit

AGENCY: Internal Revenue Service (IRS),

Treasury.

ACTION: Temporary regulations.

SUMMARY: This document contains

temporary regulations that provide

guidance for taxpayers claiming the new

markets tax credit under section 45D. A

taxpayer making a qualified equity

investment in a qualified community

development entity that has received a

new markets tax credit allocation may

claim a 5-percent tax credit with respect

to the qualified equity investment on

each of the first 3 credit allowance dates

and a 6-percent tax credit with respect

to the qualified equity investment on

each of the remaining 4 credit allowance

dates. The text of these temporary

regulations also serves as the text of the

proposed regulations set forth in the

notice of proposed rulemaking on this

subject in REG–119436–01 published

elsewhere in this issue of the Federal

Register.

DATES: Effective Date: These regulations

are effective December 26, 2001.

Date of Applicability: For date of

applicability of § 1.45D–1T, see § 1.45D–

1T(h).

FOR FURTHER INFORMATION CONTACT: Paul

Handleman, (202) 622–3040.

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

These regulations are being issued

without prior notice and public

procedure pursuant to the

Administrative Procedure Act (5 U.S.C.

553). For this reason, the collections of

information contained in these

regulations have been reviewed and,

pending receipt and evaluation of

public comments, approved by the

Office of Management and Budget under

control number 1545–1765. Responses

to these collections of information are

mandatory.

An agency may not conduct or

sponsor, and a person is not required to

respond to, a collection of information

unless the collection of information

displays a valid OMB control number.

For further information concerning

these collections of information, and

where to submit comments on the

collections of information and the

accuracy of the estimated burden, and

suggestions for reducing this burden,

please refer to the preamble to the crossreferencing notice of proposed

rulemaking published in the Proposed

Rules section of this issue of the Federal

Register.

Books or records relating to a

collection of information must be

retained as long as their contents may

become material in the administration

of any internal revenue law. Generally,

tax returns and tax return information

are confidential, as required by 26

U.S.C. 6103.

Background

This document contains temporary

regulations relating to the new markets

tax credit under section 45D of the

Internal Revenue Code (Code). This

provision was added to the Code by

section 121(a) of the Community

Renewal Tax Relief Act of 2000

(Pub. L. 106–554). The Secretary has

delegated certain administrative,

application, allocation, monitoring, and

other programmatic functions relating to

the new markets tax credit program to

the Under Secretary (Domestic Finance),

who in turn has delegated those

functions to the Community

Development Financial Institutions

Fund (CDFI Fund).

On May 1, 2001, the IRS published an

advance notice of proposed rulemaking

in the Federal Register (66 FR 21844)

inviting comments relating to tax issues

arising under section 45D. Numerous

comments have been received. The IRS

and Treasury Department have reviewed

and considered all the comments in the

process of preparing this Treasury

decision. This preamble to the

temporary regulations describes many,

but not all, of the comments received by

the IRS.

Explanation of Provisions

General Overview

Taxpayers may claim a new markets

tax credit on a credit allowance date in

an amount equal to the applicable

percentage of the taxpayer’s qualified

equity investment in a qualified

community development entity (CDE).

The credit allowance date for any

qualified equity investment is the date

on which the investment is initially

made and each of the 6 anniversary

dates thereafter. The applicable

percentage is 5 percent for the first 3

credit allowance dates and 6 percent for

the remaining credit allowance dates.

A CDE is any domestic corporation or

partnership if: (1) The primary mission

of the entity is serving or providing

investment capital for low-income

communities or low-income persons; (2)

the entity maintains accountability to

residents of low-income communities

through their representation on any

governing board of the entity or on any

advisory board to the entity; and (3) the

entity is certified by the Secretary for

purposes of section 45D as being a CDE.

The new markets tax credit may be

claimed only for a qualified equity

investment in a CDE. A qualified equity

investment is any equity investment in

a CDE for which the CDE has received

an allocation from the Secretary if,

among other things, the CDE uses

substantially all of the cash from the

investment to make qualified lowincome community investments. Under

a safe harbor, the substantially-all

requirement is treated as met if at least

85 percent of the aggregate gross assets

of the CDE are invested in qualified lowincome community investments.