subdivision of any State regulating the ownership or 
conduct of an insurance or surety business in any 
jurisdiction. 
(4) EXEMPTION FROM TAXATION.—
(A) ON AND BEFORE TRANSITION DATE.—
On and before the transition date, the Corpora-
tion, the Insurance Corporation, and any other 
subsidiary of the Corporation, including the 
franchise, capital, reserves, surplus, securities 
holdings, and income of the Corporation, the 
Insurance Corporation, or any such subsidiary 
shall be exempt from taxation now or hereafter 
imposed by the United States, any State, or 
any county, municipality, or local taxing au-
thority. 
(B) AFTER TRANSITION DATE.—After the 
transition date, the Corporation, the Insurance 
Corporation, and any other subsidiary of the 
Corporation, including the franchise, capital, re-
serves, surplus, securities holdings, and income 
of the Corporation, the Insurance Corporation, 
or any such subsidiary shall be exempt from all 
taxation now or hereafter imposed by the 
United States, any State, or any county, mu-
nicipality, or local taxing authority in any
State, provided that the Corporation, the Insur-
ance Corporation and any other subsidiary of 
the Corporation shall be subject to Federal in-
come taxation. 
SEC. 10. MANAGEMENT OF THE CORPORATION. 
(a) BOARD OF DIRECTORS.—
(1) NUMBER AND APPOINTMENT.—Subject to 
the provisions of section 13, the Corporation shall 
have a board of directors consisting of 12 members, 
9 of whom shall be appointed by the President. 
(2) REQUIRED
EXPERTISE.—The President 
shall appoint individuals to the board of directors of 
the Corporation with a demonstrated experience and 
expertise in the general field of infrastructure 
project development, finance, or related disciplines. 
(3) ADDITIONAL
SELECTION
CRITERIA.—The 
President shall ensure that, of the nonofficer direc-
tors appointed to the board of directors, a minimum 
of 6 shall be selected from among representatives of 
the private sector, of which—
(A) 2 shall be representatives of organized 
labor; and 
(B) 2 shall be individuals involved in the 
field of public-private infrastructure finance and 
related disciplines.
(4) CONSULTATION WITH THE NATIONAL GOV-
ERNORS’ CONFERENCE.—The President shall select 
2 of the nonofficer directors to be appointed to the 
board of directors after consulting with and consid-
ering the recommendations of the National Gov-
ernors’ Conference. 
(5) APPOINTMENT
OF
OFFICERS
TO
THE 
BOARD.—A majority of the nonofficer members of 
the board shall appoint the president of the Corpora-
tion who shall serve on the board of directors. The 
president of the Corporation shall select 2 executive 
officers to be appointed to the board, subject to con-
firmation by a majority of the board. 
(6) TERMS.—
(A) PRESIDENTIAL
APPOINTEES.—Each 
director appointed by the President shall be ap-
pointed for a term of 4 years, except as pro-
vided in subparagraph (B). 
(B) 
INITIAL
PRESIDENTIAL
AP-
POINTEES.—As designated by the President, of 
the directors first appointed by the President—
(i) 1⁄3 shall be appointed for a term of 
2 years; 
(ii) 1⁄3 shall be appointed for a term 
of 3 years; and
(iii) 1⁄3 shall be appointed for a term 
of 4 years. 
(C) OFFICER
DIRECTORS.—Officer direc-
tors of the Corporation shall serve for a period 
of 1 year or until they cease to be an officer of 
the Corporation. 
(D) INTERIM APPOINTMENTS.—Any direc-
tor appointed to fill a vacancy occurring before 
the expiration of the term for which the direc-
tor’s predecessor was appointed shall be ap-
pointed only for the remainder of that term. 
(E) CONTINUATION OF SERVICE.—A direc-
tor may serve after the expiration of that direc-
tor’s term until a successor has taken office. 
(7) VACANCIES.—A vacancy in the board of di-
rectors shall be filled in the manner in which the 
original appointment was made. 
(8) REAPPOINTMENT.—
(A) PRESIDENTIAL
APPOINTEES.—Mem-
bers of the board of directors appointed by the 
President may be reappointed by the President, 
consistent with the requirements of this section. 
(B) OFFICER DIRECTORS.—The president 
of the Corporation shall be reappointed to the 
board by the nonofficer directors for so long as
such individual continues to serve as president 
of the Corporation. Officer directors of the 
board selected by the president of the Corpora-
tion may be reappointed by the president of the 
Corporation, consistent with the requirements 
of this section. 
(9) REMOVAL.—
(A) PRESIDENTIAL APPOINTEES.—A direc-
tor appointed by the President shall be subject 
to removal only for cause. 
(B) OFFICER
DIRECTORS.—Officer direc-
tors of the Corporation shall be subject to re-
moval from the board in the discretion of a ma-
jority of the board, except that the president of 
the Corporation shall continue to serve on the 
board for so long as he or she serves as presi-
dent of the Corporation. 
(10) QUORUM.—7 directors shall constitute a 
quorum. 
(11) CHAIRPERSON.—The chairperson of the 
board of directors shall be selected by a majority of 
the board from among the nonofficer directors of the 
board, and shall serve for a period of 1 year, or until 
a new chairperson is selected.
(12) STATUS AND COMPENSATION OF BOARD 
MEMBERS.—
(A) NONOFFICER
DIRECTORS.—Members 
of the board of directors who are not officers of 
the Corporation shall serve on a part-time basis 
and shall receive a per diem, when engaged in 
the actual performance of Corporation business, 
plus reasonable reimbursement for travel, sub-
sistence and other necessary expenses incurred 
in the performance of their duties. 
(B) OFFICER
DIRECTORS.—Members of 
the board of directors who are officers of the 
Corporation shall not be entitled to receive any 
salary or other compensation for services as a 
director of the Corporation, but may receive 
reasonable reimbursement for travel, subsist-
ence and other necessary expenses incurred in 
the performance of their duties as directors of 
the Corporation. 
(13) CONFLICTS OF INTEREST.—
(A) IN
GENERAL.—Nonofficer directors 
shall have no responsibility for, and shall not 
seek to influence, any decision of the inde-
pendent investment committee established pur-
suant to section 8(h).
(B) 
CONSULTATION.—Notwithstanding 
subparagraph (A), the investment committee 
may, in the committee’s discretion and on the 
committee’s own initiative, consult with the 
board of directors as the committee sees fit. 
(C) LIMITATION ON CONSULTATION.—No 
nonofficer director of the Corporation who has, 
or is affiliated with a person who has, an inter-
est in any project under consideration for as-
sistance under this Act shall participate in any 
consultation under subparagraph (B) with re-
spect to such project. 
(14) MEETINGS.—The board of directors shall 
meet at any time pursuant to the call of the chair-
person or a majority of the directors and as provided 
by the bylaws of the Corporation, but not less than 
once each calendar quarter. 
(15) DUTIES.—In addition to any duties estab-
lished under this Act and the bylaws of the Corpora-
tion, the board of directors shall determine the gen-
eral policies which shall govern the operations of the 
Corporation in accordance with this Act. 
(16) DELEGATION OF AUTHORITY.—The board 
of directors may delegate duties and powers of the
board to such committees of the board as the board 
may determine to be appropriate. 
(b) OFFICERS OF THE CORPORATION.—
(1) PRESIDENT
OF
THE
CORPORATION.—The 
president of the Corporation shall be the chief execu-
tive officer of the Corporation, with such executive 
functions, powers, and duties as may be prescribed 
by this Act, the bylaws, or the board of directors. 
(2) APPOINTMENT OF OFFICERS.—The presi-
dent of the Corporation shall, with the approval of 
a majority of the board, appoint qualified individuals 
to such executive officer positions as may be pro-
vided for in the bylaws of the Corporation, and shall 
define their duties. The president may appoint, re-
move, fix the compensation of, and define the duties 
of other officers as provided in the bylaws. 
(3) COMPENSATION.—The compensation of the 
president and the executive officers of the Corpora-
tion shall be determined by the board of directors of 
the Corporation, in the discretion of the board of di-
rectors. 
(4) CONFLICTS OF INTEREST.—Officers of the 
Corporation shall not participate in any review or 
decision affecting a project under consideration for 
assistance under this Act if such officer has, or is
affiliated with a person who has, an interest in such 
project. 
(5) REMOVAL.—Any executive officer of the 
Corporation may be removed in the discretion of a 
majority of the board of directors. 
SEC. 11. MANAGEMENT OF THE INSURANCE CORPORATION. 
(a) BOARD OF DIRECTORS.—
(1) NUMBER AND ELECTION.—Subject to the 
provisions of section 13, the Insurance Corporation 
shall have a board of directors consisting of 12 
members elected by the stockholders of the Insur-
ance Corporation. 
(2) INITIAL
APPOINTMENT
OF
DIRECTORS.—
The initial directors of the Insurance Corporation 
shall be appointed by the board of directors of the 
Corporation. 
(3) REQUIRED EXPERTISE.—The board shall be 
comprised of individuals who have a demonstrated 
expertise and experience in the field of credit en-
hancement or insurance and related disciplines, a 
minimum of 9 of whom shall be selected from among 
representatives of the private sector. 
(4) TERMS.—
(A) IN GENERAL.—Each director shall be 
elected or appointed for a term of 2 years, ex-
cept as provided in subparagraph (B). 
(B) INTERIM APPOINTMENTS.—Any direc-
tor elected or appointed to fill a vacancy occur-
ring before the expiration of the term for which 
the director’s predecessor was appointed shall 
be elected or appointed only for the remainder 
of that term. 
(C) CONTINUATION OF SERVICE.—A direc-
tor may serve after the expiration of that direc-
tor’s term until a successor has taken office. 
(5) VACANCIES.—A vacancy in the board of di-
rectors shall be filled in the manner in which the 
original appointment was made, except that the by-
laws may provide for the appointment by the board 
of directors of a director to fill a vacancy occurring 
before the expiration of the term for which the direc-
tor’s predecessor was elected or appointed. 
(6) QUORUM.—7 directors shall constitute a 
quorum. 
(7) CHAIRPERSON.—
(A) ELECTION.—The chairperson of the 
board of directors shall be elected by the board
of directors from among the directors on the 
board. 
(B) TERM.—The term of office of the 
chairperson shall be 1 year or until a new chair-
person is elected. 
(8) STATUS
AND
COMPENSATION
OF
BOARD 
MEMBERS.—Members of the board of directors shall 
serve on a part-time basis and shall receive a per 
diem, when engaged in the actual performance of In-
surance Corporation business, plus reasonable reim-
bursement for travel, subsistence and other nec-
essary expenses incurred in the performance of their 
duties. 
(9) CONFLICTS OF INTEREST.—
(A) IN
GENERAL.—Nonofficer directors 
shall have no responsibility for, and shall not 
seek to influence, any decision of the inde-
pendent investment committee established pur-
suant to section 8(h). 
(B) 
CONSULTATION.—Notwithstanding 
subparagraph (A), the investment committee 
may, in the committee’s discretion and on the 
committee’s own initiative, consult with the 
board of directors as the committee sees fit.
(C) LIMITATION ON CONSULTATION.—No 
director who has, or is affiliated with any per-
son who has, an interest in any project under 
consideration for assistance under this Act shall 
participate in any such consultation with re-
spect to such project. 
(10) MEETINGS.—The board of directors shall 
meet at any time pursuant to the call of the chair-
person or a majority of the directors and as provided 
by the bylaws of the Insurance Corporation, but not 
less than once each calendar quarter. 
(11) DUTIES.—In addition to any duties estab-
lished under this Act or the bylaws of the Insurance 
Corporation, the board of directors shall determine 
the general policies which shall govern the oper-
ations of the Insurance Corporation in accordance 
with this Act. 
(12) DELEGATION OF AUTHORITY.—The board 
of directors may delegate duties and powers of the 
board to such committees of the board as the board 
may determine to be appropriate. 
(b) OFFICERS OF THE INSURANCE CORPORATION.—
(1) PRESIDENT OF THE INSURANCE CORPORA-
TION.—There shall be a position of president of the 
Insurance Corporation who shall be the chief execu-
tive officer of the Insurance Corporation, with such 
executive functions, powers, and duties as may be 
prescribed by the bylaws or by the board of direc-
tors. 
(2) APPOINTMENT OF OFFICERS.—The chair-
person of the board of directors of the Insurance 
Corporation shall, with the approval of a majority of 
the board, appoint a qualified individual to the posi-
tion of president of the Insurance Corporation. The 
president of the Insurance Corporation shall, with 
the approval of a majority of the board, appoint 
qualified individuals to such executive officer posi-
tions as may be provided for in the bylaws of the In-
surance Corporation, and shall define their duties. 
The president may appoint, remove, fix the com-
pensation of, and define the duties of other officers 
as provided in the bylaws. 
(3) COMPENSATION.—The compensation of the 
president and the executive officers of the Insurance 
Corporation shall be determined by the board of di-
rectors of the Insurance Corporation, in the discre-
tion of the board of directors. 
(4) CONFLICTS OF INTEREST.—Officers of the 
Insurance Corporation shall not participate in any 
review or decision affecting a project under consider-
ation for assistance under this Act if such officer 
has, or is affiliated with a person who has, an inter-
est in such project. 
(5) REMOVAL.—Any executive officer of the In-
surance Corporation may be removed in the discre-
tion of a majority of the board of directors. 
SEC. 12. BOARD OF DIRECTOR MEETINGS OPEN TO PUBLIC. 
(a) GENERAL.—All meetings of the full board of di-
rectors held to conduct the business of the Corporation 
or the Insurance Corporation shall be open to the public, 
and shall be preceded by reasonable notice. 
(b) CLOSED MEETINGS.—Pursuant to such rules as 
the Corporation and the Insurance Corporation may es-
tablish through their bylaws, the respective board of direc-
tors may close a meeting of the board if at the meeting 
there is likely to be disclosed information which could ad-
versely affect or lead to speculation relating to an infra-
structure project under consideration for assistance under 
this Act, or in financial or securities or commodities mar-
kets or institutions, utilities, or real estate. The deter-
mination to close any meeting of either board of directors 
shall be made in a meeting of such board, open to the 
public, and preceded by reasonable notice. The respective 
board of directors shall prepare minutes of any meeting 
which is closed to the public and make such minutes avail-
able as soon as the considerations necessitating closing 
such meeting no longer apply. 
SEC. 13. TRANSITION TO GOVERNMENT-SPONSORED EN-
TERPRISE. 
(a) GENERAL.—Within 5 years after the date of the 
enactment of this Act, the Corporation shall prepare a 
strategic plan for the transition of NIC to a government-
sponsored enterprise (as defined in section 3(8) of the 
Congressional Budget and Impoundment Control Act of 
1974 (2 U.S.C. 622(8)) and for the sale or transfer to 
investors other than the Federal Government, as set forth 
in subsection (b), of the voting securities of the Corpora-
tion. The Corporation shall revise such transition plan as 
needed. 
(b) PLAN; PENSION PLAN PARTICIPATION.—
(1) IN GENERAL.—The strategic plan shall in-
clude consideration of alternative means for effecting 
such transition through a broad distribution to long-
term investors, including by a public offering of 
stock or convertible stock or debt. 
(2) PENSION PLAN PARTICIPATION.—The stra-
tegic plan shall include provisions that specify that 
the initial purchasers of voting securities of the Cor-
poration or of nonvoting securities which are con-
vertible to such voting securities on the transition
date (disregarding any underwriters of such securi-
ties) shall be pension plans. 
(c) MEANS OF TRANSFER.—
(1) IN GENERAL.—The strategic plan may call 
for a phased transfer of ownership or for complete 
transfer at a single point in time. 
(2) RULES
APPLICABLE
IN
THE
CASE
OF
A 
PHASED TRANSITION.—If the plan calls for phased 
transfer of ownership—
(A) such transition shall be deemed to 
occur when 100 percent of the voting securities 
of the Corporation have been transferred to or 
are held by investors other than the Federal 
Government, and the investment of the Federal 
Government in the Corporation has been repaid 
or converted as provided in subsection (h); 
(B) before the transition date, all equity 
securities of the Corporation held by investors 
other than the Federal Government (or any eq-
uity security into which any other security is 
convertible) shall be nonvoting securities; and 
(C) on and after the transition date, non-
voting equity securities of the Corporation held 
by investors other than the Federal Government 
(or into which other securities are convertible)
may, in accordance with the terms of such secu-
rities, be converted or become convertible into 
voting securities. 
(d) REQUIREMENT OF PRESIDENTIAL APPROVAL.—
The Corporation may not implement the transition plan 
without the approval of the President, and shall seek re-
approval if the plan is materially altered. 
(e) NOTIFICATION OF CONGRESS.—
(1) IN GENERAL.—The Corporation shall notify 
the Congress of—
(A) the Corporation’s intent to implement 
the transition plan; and 
(B) any material alteration of a transition 
plan previously submitted to the Congress. 
(2) REPORT.—Within 30 days of any notifica-
tion of the Congress under paragraph (1), the 
Comptroller General of the United States shall sub-
mit a report to Congress evaluating the extent to 
which—
(A) the transition plan (as then modified) 
would result in ongoing obligations (other than 
contemplated by subsection (h)) or undue cost 
to the Federal Government; and 
(B) the cash proceeds (or projected range 
thereof) to be provided to the Federal Govern-
ment, or the securities proposed to be received 
in exchange for the investment of the Federal 
Government in the Corporation or portion 
thereof, represents the full recoupment of such 
investment (after taking into account any divi-
dends paid to the Federal Government). 
(f) CONGRESSIONAL REVIEW.—The Corporation may 
implement the plan not less than 60 days after notification 
of the Congress, if the approval of the President referred 
to in subsection (d) has been received. 
(g) DEPOSIT OF PROCEEDS.—Any cash proceeds re-
ceivable by the Federal Government pursuant to this sec-
tion shall be deposited in the general fund of the Treasury. 
(h) CONVERSION
OF FEDERAL GOVERNMENT IN-
VESTMENT.—Upon the implementation of the transition 
plan, the voting equity securities of the Corporation held 
by the Federal Government or, in the case of a phased 
transition, that portion of the voting equity securities 
which are subject to such phase shall be repurchased by 
the Corporation or converted to long-term subordinated 
debt securities having a par amount not less than the 
amounts appropriated pursuant to section 19 and subject 
to such phase, or a combination thereof, as contemplated 
by such plan. 
(i) BOARD OF DIRECTORS.—
(1) CORPORATION.—
(A) INITIAL
BOARD.—Before the end of 
the 120-day period beginning on the transition 
date, a special meeting of the stockholders of 
the Corporation shall be held, at which all di-
rectors of the Corporation shall be elected to 
serve a 1-year term or until any such director’s 
successor has been elected. 
(B) NOMINATION; SELECTION CRITERIA.—
The candidates for election to the board of di-
rectors under paragraph (1) shall be nominated 
by the existing board of directors and 4 of such 
candidates shall be nominated in accordance 
with the selection criteria set out in section 
10(a)(3). 
(C) SUBSEQUENT BOARDS.—After the 1st 
election of a board of directors pursuant to sub-
paragraph (A), the directors shall be elected 
and subject to removal by the stockholders of 
the Corporation, as provided in the District of 
Columbia Business Corporation Act, except that 
the nomination of candidates for each election 
of the board of directors shall continue to re-
flect the requirements of section 10(a)(3). 
(2) INSURANCE CORPORATION.—
(A) INITIAL
BOARD.—Promptly following 
the special meeting of the stockholders of the 
Corporation pursuant to paragraph (1), a spe-
cial meeting of the stockholders of the Insur-
ance Corporation shall be held, at which all di-
rectors or the Insurance Corporation shall be 
elected to serve a 1-year term or until any such 
director’s successor has been elected. 
(B) SUBSEQUENT BOARDS.—After the 1st 
election of a board of directors pursuant to sub-
paragraph (A), the directors shall be elected 
and subject to removal by the stockholders of 
the Insurance Corporation, as provided in the 
District of Columbia Business Corporation Act. 
(j) TRANSMITTAL OF FINAL PLAN AFTER COMPLE-
TION.—The Corporation shall transmit copies of the final 
strategic plan for transition to the President and the Con-
gress upon completion of such transition. 
SEC. 14. STATUS AND APPLICABILITY OF CERTAIN FED-
ERAL LAWS. 
(a) BEFORE THE TRANSITION DATE.—Before the 
transition date, the Corporation, the Insurance Corpora-
tion, and any other subsidiary of the Corporation, shall—
(1) not be agencies of the United States; and
(2) comply with all Federal laws regulating the 
budgetary and auditing practices of a government 
corporation, except as otherwise provided in this Act. 
(b) SUBSEQUENT TO THE TRANSITION DATE.—On 
and after the transition date, the Corporation, the Insur-
ance Corporation, and any other subsidiary of the Cor-
poration shall not be considered to be an agency, instru-
mentality, or establishment of the United States Govern-
ment or a government corporation or a government-con-
trolled corporation, for purposes of any Federal law, ex-
cept as otherwise provided in this Act. 
(c) AUTHORIZED INVESTMENTS AND SECURITY.—All 
obligations issued by the Corporation shall be authorized 
investments for any person created under the laws of the 
United States or any State to the same extent that the 
person may hold or invest in obligations issued by or guar-
anteed as to principal or interest by the United States or 
any agency or instrumentality of the United States. 
(d) EFFECT OF AND EXEMPTIONS FROM OTHER 
LAWS.—
(1) EXEMPT SECURITIES.—All equity and debt 
securities and other obligations issued by the Cor-
poration or the Insurance Corporation pursuant to 
this Act shall be deemed to be exempt securities 
within the meaning of laws administered by the Se-
curities and Exchange Commission to the same ex-
tent as securities which are direct obligations of, or 
obligations fully guaranteed as to principal or inter-
est by, the United States. 
(2) OPEN
MARKET
OPERATIONS
AND
STATE 
TAX EXEMPT STATUS.—The obligations of the Cor-
poration shall be deemed to be obligations of the 
United States for the purposes of the provision des-
ignated as (b)(2) of the 2nd undesignated paragraph 
of section 14 of the Federal Reserve Act and section 
3124 of title 31, United States Code. 
(3) NO PRIORITY AS A FEDERAL CLAIM.—The 
priority established in favor of the United States by 
section 3713 of title 31, United States Code, shall 
not apply with respect to any indebtedness of the 
Corporation or the Insurance Corporation. 
(e) FEDERAL RESERVE BANKS AS DEPOSITARIES, 
CUSTODIANS, AND FISCAL AGENTS.—The Federal reserve 
banks may act as depositaries for, or custodians or fiscal 
agents of, the Corporation and the Insurance Corporation. 
(f) ACCESS
TO BOOK-ENTRY SYSTEM.—The Sec-
retary may authorize the Corporation and the Insurance 
Corporation to use the book-entry system of the Federal 
reserve system.
SEC. 15. COMPLIANCE WITH DAVIS-BACON ACT. 
NIC shall take such action as may be necessary to 
ensure that projects assisted in whole or in part under 
the provisions of this Act shall incorporate a provision re-
quiring in any contract relating to any construction, recon-
struction, rehabilitation, replacement, or expansion of 
such project, that not less than the wages prevailing in 
the locality, as predetermined by the Secretary of Labor 
pursuant to the Act of March 3, 1931, commonly referred 
to as the ‘‘Davis-Bacon Act’’ (40 U.S.C. 276a), shall be 
paid to all laborers and mechanics employed to perform 
such contracts. 
SEC. 16. OBLIGATIONS NOT FEDERALLY GUARANTEED; 
STATE LAWS. 
(a) STATUS OF SECURITIES.—
(1) NO
FULL
FAITH
AND
CREDIT
OF
THE 
U.S.—Obligations of the Corporation or the Insur-
ance Corporation, and obligations insured by any 
such corporation shall not be obligations of, or guar-
anteed as to principal or interest by, the United 
States or any agency of the United States and the 
obligations shall so plainly state. 
(2) FINANCING NOT TREATED AS U.S. GUAR-
ANTEE.—The provision of assistance of any kind or 
nature from NIC shall not be treated as a direct or 
indirect guarantee of any payment of principal or in-
terest on any security by the United States for pur-
poses of section 149(b) of the Internal Revenue 
Code of 1986 or any other law. 
(b) STATE LAWS.—The receipt by any entity of any 
assistance under this Act, directly or indirectly, and any 
financial assistance provided by any governmental entity 
in connection with such assistance under this Act shall be 
valid and lawful notwithstanding any State or local restric-
tions regarding extensions of credit or other benefits to 
private persons or entities, or other similar restrictions. 
SEC. 17. AUDITS; REPORTS TO THE PRESIDENT AND THE 
CONGRESS. 
(a) ACCOUNTING.—The books of account of NIC 
shall be maintained in accordance with generally accepted 
accounting principles and shall be subject to an annual 
audit by independent public accountants of nationally rec-
ognized standing. 
(b) REPORTS.—NIC shall submit to the President 
and the Congress, within 90 days after the end of each 
fiscal year, a complete and detailed report with respect 
to the preceding fiscal year, setting forth—
(1) a summary of NIC’s operations, for such 
preceding fiscal year; 
(2) NIC’s financial statements and the opinion 
with respect thereto prepared by the independent
public accountant reviewing such statements and a 
copy of any report made on an audit conducted 
under subsection (a) of this section; 
(3) a schedule of NIC’s obligations and capital 
securities outstanding at the end of such fiscal year, 
with a statement of the amounts issued and re-
deemed or paid during such fiscal year; and 
(4) the status of projects receiving funding or 
other assistance pursuant to this Act, including dis-
closure of all entities with a development, ownership, 
or operational interest in such projects. 
(c) BOOKS AND RECORDS.—
(1) IN GENERAL.—NIC shall maintain adequate 
books and records to support the financial trans-
actions of the Corporation, the Insurance Corpora-
tion, and subsidiaries of such corporations. 
(2) AUDITS BY THE SECRETARY AND GAO.—
The books and records of NIC shall be maintained 
in accordance with recommended accounting prac-
tices and shall be open to inspection by the Sec-
retary and the Comptroller General of the United 
States.
SEC. 18. TAX TREATMENT OF DISTRIBUTIONS FROM QUALI-
FIED RETIREMENT PLANS INVESTING IN 
PUBLIC BENEFIT BONDS. 
(a) IN GENERAL.—Section 72 of the Internal Rev-
enue Code of 1986 (relating to annuities; certain proceeds 
of endowment and life insurance contracts) is amended by 
redesignating subsection (w) as subsection (x) and by in-
serting after subsection (v) the following new subsection: 
‘‘(w) TREATMENT OF DISTRIBUTION FROM QUALI-
FIED RETIREMENT PLANS INVESTING IN PUBLIC BEN-
EFIT BONDS.—
‘‘(1) IN GENERAL.—In the case of any qualified 
retirement plan which receives directly or indirectly 
any interest on any public benefit bond (including 
any payments in respect thereof made by a surety 
or guarantor) for purposes of applying this section 
to any distribution from such plan, the distributee’s 
investment in the contract shall be treated as includ-
ing such distributee’s allocable share of such interest 
under the terms of the qualified retirement plan, 
and any such distribution shall be treated as a dis-
tribution described in subsection (e)(2)(B) in which 
the distribution is allocable first to the investment in 
the contract attributable to such interest. 
‘‘(2) TREATMENT OF INSTALLMENTS.—In the 
case of a distribution to be made over more than one
calendar year, the amount of public benefit bond in-
terest to be taken into account with respect to a 
given calendar year shall be the aggregate amount of 
such interest allocable to the distributee as of the 
end of the prior calendar year. With respect to the 
final calendar year, the amount of public benefit 
bond interest to be taken into account shall include 
the amount of such interest received by the plan 
during such year that is allocable to the plan partici-
pant with respect to whom the distribution is made. 
‘‘(3) PUBLIC BENEFIT BOND.—For purposes of 
this subsection, the term ‘public benefit bond’ means 
any obligation issued after the date of the enactment 
of this subsection if—
‘‘(A) 95 percent or more of the net pro-
ceeds of such obligation are used in connection 
with the financing or refinancing of 1 or more 
infrastructure facilities, 
‘‘(B) such obligation has received a pub-
lished rating, and 
‘‘(C) the development of such infrastruc-
ture facilities have been or will be undertaken 
by a governmental entity or public-private part-
nership,
‘‘(B) an eligible deferred compensation 
plan (as defined in section 457(b)). 
‘‘(7) TREATMENT OF DIVIDENDS FROM MUTUAL 
FUNDS.—
‘‘(A) IN GENERAL.—For purposes of this 
subsection, in the case of any dividend (other 
than a dividend described in section 854(a)) re-
ceived from a regulated investment company 
which meets the requirements of section 852 for 
the taxable year in which it paid the dividend—
‘‘(i) the entire amount of such divi-
dend shall be treated as interest on a pub-
lic benefit bond if the aggregate interest on 
such bonds received by such company dur-
ing the taxable year equals or exceeds 75 
percent of its gross income, or 
‘‘(ii) if clause (i) does not apply, a 
portion of such dividend shall be treated as 
interest on a public benefit bond based on 
the portion of the company’s gross income 
which consists of such interest. 
‘‘(B) NOTICE
TO
SHAREHOLDERS.—The 
amount of any distribution by a regulated in-
vestment company which may be taken into ac-
count as interest on a public benefit bond for
purposes of this section shall not exceed the 
amount so designated by the company in a writ-
ten notice to its shareholders mailed not later 
than 45 days after the close of its taxable year. 
‘‘(C) GROSS
INCOME.—For purposes of 
this section, the term ‘gross income’ does not 
include gain from the sale or other disposition 
of stock or securities.’’. 
(b) EFFECTIVE DATE.—The amendment made this 
section shall apply to distributions after the date of the 
enactment of this Act. 
SEC. 19. AUTHORIZATIONS. 
(a) APPROPRIATIONS AUTHORIZED FOR ESTABLISH-
MENT.—There are hereby authorized to be appropriated 
to the Secretary $30,000,000 for the purpose of facili-
tating the NIC’s initial operations. 
(b) APPROPRIATIONS AUTHORIZED FOR CONDUCT OF 
BUSINESS OF NIC.—There are authorized to be appro-
priated to the Secretary $3,000,000,000 for each of the 
fiscal years 2005 through 2008 to make the capital con-
tributions in accordance with section 9(a)(1)(A) for the 
purpose of carrying out this Act. 
(c) ESTABLISHMENT OF NIC ACCOUNT.—Before the 
transition date, the funds appropriated under subsection 
(b) shall be deposited in an account to be established in
the Treasury of the United States to be known as the 
‘‘National Infrastructure Development Corporation Ac-
count’’, which shall be available to the Corporation, with-
out need for further appropriation and without fiscal year 
limitation, for carrying out its purposes, functions and 
powers, including the investment and reinvestment of 
these funds as permitted in this Act, and which shall not 
be subject to apportionment under subchapter II of chap-
ter 15 of title 31, United States Code. The Secretary of 
the Treasury, in consultation with the board of directors 
of the Corporation, shall invest amounts in the account 
in public debt securities with maturities suitable to the 
needs of the account and bearing interest at rates deter-
mined by the Secretary, taking into consideration current 
market yields on outstanding marketable obligations of the 
United States of comparable maturities. 
SEC. 20. PROHIBITION ON ADDITIONAL FEDERAL ASSIST-
ANCE. 
Except as otherwise specifically provided by sections 
13 and 19, NIC shall receive no appropriations, loans, or 
other financial assistance from the Federal Government.
Æ