I
107TH CONGRESS
1ST SESSION
H. R. 1969
To amend the Internal Revenue Code of 1986 to provide an interest-free
source of capital to cover the costs of installing residential solar energy
equipment.
IN THE HOUSE OF REPRESENTATIVES
MAY 23, 2001
Mr. MCDERMOTT 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
an interest-free source of capital to cover the costs of
installing residential solar energy equipment.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Residential Solar En-
ergy Act of 2001’’.
SEC. 2. CREDIT TO HOLDERS OF RESIDENTIAL SOLAR EN-
ERGY BONDS.
(a) IN GENERAL.—Subpart B of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 is amended by adding at the end the following new
section:
‘‘SEC. 30B. CREDIT TO HOLDERS OF RESIDENTIAL SOLAR
ENERGY BONDS.
‘‘(a) ALLOWANCE OF CREDIT.—In the case of a tax-
payer who holds a Residential Solar Energy Bond on a
credit allowance date of such bond which occurs during
the taxable year, there shall be allowed as a credit against
the tax imposed by this chapter for such taxable year an
amount equal to the sum of the credits determined under
subsection (b) with respect to credit allowance dates dur-
ing such year on which the taxpayer holds such bond.
‘‘(b) AMOUNT OF CREDIT.—
‘‘(1) IN GENERAL.—The amount of the credit
determined under this subsection with respect to any
credit allowance date for a Residential Solar Energy
Bond is 25 percent of the annual credit determined
with respect to such bond.
‘‘(2) ANNUAL CREDIT.—The annual credit de-
termined with respect to any Residential Solar En-
ergy Bond is the product of—
‘‘(A) the applicable credit rate, multiplied
by
‘‘(B) the outstanding face amount of the
bond.
‘‘(3) APPLICABLE CREDIT RATE.—For purposes
of paragraph (1), the applicable credit rate with re-
spect to an issue is the rate equal to an average
market yield (as of the day before the date of
issuance of the issue) on outstanding long-term cor-
porate debt obligations (determined under regula-
tions prescribed by the Secretary).
‘‘(4) SPECIAL RULE FOR ISSUANCE AND RE-
DEMPTION.—In the case of a bond which is issued
during the 3-month period ending on a credit allow-
ance date, the amount of the credit determined
under this subsection with respect to such credit al-
lowance date shall be a ratable portion of the credit
otherwise determined based on the portion of the 3-
month period during which the bond is outstanding.
A similar rule shall apply when the bond is re-
deemed.
‘‘(c) RESIDENTIAL SOLAR ENERGY BOND.—For pur-
poses of this section—
‘‘(1) IN
GENERAL.—The term ‘Residential
Solar Energy Bond’ means any bond issued as part
of an issue if—
‘‘(A) 95 percent or more of the proceeds of
such issue are to be used to make qualified
solar energy loans,
‘‘(B) the bond is issued by a qualified util-
ity,
‘‘(C) the issuer designates such bond for
purposes of this section, and
‘‘(D) the term of each bond which is part
of such issue does not exceed 15 years.
‘‘(2) QUALIFIED SOLAR ENERGY LOAN.—
‘‘(A) IN
GENERAL.—The term ‘qualified
solar energy loan’ means any loan without in-
terest to the owner of any qualified residential
property for the purchase and installation of
photovoltaic cells on such property but only if—
‘‘(i) the excess of the electricity pro-
duced by such cells over the electricity con-
sumed at the residential property is trans-
mitted from such property for use by oth-
ers,
‘‘(ii) the net electricity produced or
consumed at the residential property is me-
tered,
‘‘(iii) the owner receives a credit
against future electricity consumption for
the excess described in clause (i),
‘‘(iv) the principal amount of the loan
is payable in equal installments over 15