I

103D CONGRESS

1ST SESSION H.R. 1619

To amend the Internal Revenue Code of 1986 to make the low-income

housing credit permanent and to facilitate the rehabilitation of public

housing using such credit.

IN THE HOUSE OF REPRESENTATIVES

APRIL 1, 1993

Mrs. COLLINS of Illinois 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 make

the low-income housing credit permanent and to facilitate

the rehabilitation of public housing using such credit.

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 ‘‘Public Housing Reha5 bilitation Equity Act’’.

6 SEC. 2. LOW INCOME HOUSING CREDIT MADE PERMANENT.

7 Subsection (o) of section 42 of the Internal Revenue

8 Code of 1986 (relating to termination of low-income hous9 ing credit) is hereby repealed.
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1 SEC. 3. HOUSING CREDIT AVAILABLE FOR REHABILITA2 TION OF PUBLIC HOUSING.

3 (a) IN GENERAL.—Subsection (i) of section 42 of the

4 Internal Revenue Code of 1986 (relating to definitions and

5 special rules) is amended by adding at the end thereof the

6 following new paragraph:

7 ‘‘(8) SPECIAL RULES FOR CERTAIN LEASES.—

8 ‘‘(A) IN GENERAL.—In the case of an

9 agreement with respect to public housing, if all

10 of the parties to the agreement characterize

11 such agreement as a lease and elect to have the

12 provisions of this paragraph apply with respect

13 to such agreement, and if the requirements of

14 subparagraph (B) are met, then, for purposes

15 of this subtitle—

16 ‘‘(i) such agreement shall be treated

17 as a lease entered into by the parties (and

18 any lessor shall be deemed to have entered

19 into the lease in the course of carrying on

20 its trade or business), and

21 ‘‘(ii) the lessor shall be treated as the

22 owner of the property and the lessee shall

23 be treated as the lessee of the property.

24 ‘‘(B) CERTAIN REQUIREMENTS MUST BE

25 MET.—The requirements of this subparagraph

26 are met if—
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1 ‘‘(i) the lessee is a public housing

2 agency (as defined in section 3(b)(6) of the

3 United States Housing Act of 1937),

4 ‘‘(ii) the lessor agrees to incur suffi5 cient rehabilitation expenditures to be al6 lowed a credit by reason of subsection (e)

7 not later than the 2d year after entering

8 into the lease,

9 ‘‘(iii) the term of the lease ends at the

10 close of the compliance period for the

11 building, and

12 ‘‘(iv) at the end of the lease term—

13 ‘‘(I) all of the property subject to

14 the lease is owned by the public hous15 ing agency, and

16 ‘‘(II) in the case of property in

17 existence on the date of the enactment

18 of this paragraph, the applicable frac19 tion for the property (relating to low20 income occupancy) is not less than the

21 applicable fraction for such property

22 on such date.

23 ‘‘(C) PUBLIC HOUSING.—The term ‘public

24 housing’ has the meaning given such term by
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1 section 3(b)(1) of the United States Housing

2 Act of 1937.

3 ‘‘(D) NO OTHER FACTORS TAKEN INTO AC4 COUNT IN DETERMINING WHETHER THERE IS A

5 LEASE.—If the requirements of subparagraphs

6 (A) and (B) are met with respect to any trans7 action described in subparagraph (A), no other

8 factors shall be taken into account in making a

9 determination as to whether subparagraph

10 (A)(i) or (ii) applies with respect to the trans11 action.

12 ‘‘(E) 10-YEAR RULE NOT TO APPLY.—Sub13 section (d)(2)(B)(ii) shall not apply to any

14 property which is the subject of a transaction to

15 which subparagraph (A) applies.’’

16 (b) EFFECTIVE DATE.—The amendment made by

17 subsection (a) shall apply to agreements entered into after

18 December 31, 1993.

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