I
107TH CONGRESS
1ST SESSION
H. R. 178
To amend the Internal Revenue Code of 1986 to provide for the issuance
of tax-exempt bonds by Indian tribal governments, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 3, 2001
Mr. SHADEGG 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 the issuance of tax-exempt bonds by Indian tribal
governments, and for other purposes.
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 ‘‘Tribal Government
Tax-Exempt Bond Authority Amendments Act of 2001’’.
SEC. 2. CONSTITUTIONAL AUTHORITY.
The Constitutional authority upon which this Act
rests is the power of Congress to lay and collect taxes and
to regulate commerce with foreign nations and among the
several States and with the Indian tribes, as set forth in
section 8 of article I of the United States Constitution.
SEC. 3. MODIFICATIONS OF AUTHORITY OF INDIAN TRIBAL
GOVERNMENTS 
TO 
ISSUE 
TAX-EXEMPT
BONDS.
(a) GENERAL PROVISION.—Subsection (c) of section
7871 of the Internal Revenue Code of 1986 (relating to
Indian tribal governments treated as States for certain
purposes) is amended to read as follows:
‘‘(c) ADDITIONAL REQUIREMENTS FOR TAX-EXEMPT
BONDS.—
‘‘(1) IN GENERAL.—Subsection (a) of section
103 shall apply to any obligation issued by an In-
dian tribal government (or subdivision thereof) only
if such obligation is part of an issue 95 percent or
more of the net proceeds of which are to be used to
finance facilities located on land within or in close
proximity to the exterior boundaries of an Indian
reservation.
‘‘(2) PRIVATE ACTIVITY BONDS.—Any private
activity bond (as defined in section 141(a)) issued by
an Indian tribal government (or subdivision thereof)
shall be treated as a qualified bond for purposes of
section 103(b)(1) to which section 146 does not
apply if—
‘‘(A) GENERAL
RESTRICTIONS.—The re-
quirements of section 144(a)(8)(B) and section
147 are met with respect to the issue.
‘‘(B) SPECIFIC RESTRICTIONS.—
‘‘(i) OWNERSHIP.—In the case of an
issue the net proceeds of which exceed
$500,000, 50 percent or more of the prof-
its or capital interests in the facilities to be
financed thereby (or in the entity owning
the facilities) are owned either by an In-
dian tribe, a subdivision thereof, a corpora-
tion chartered under section 17 of the In-
dian Reorganization Act of 1934 (25
U.S.C. 477) or section 3 of the Oklahoma
Welfare Act (25 U.S.C. 503), individual
enrolled members of an Indian Tribe, an
entity wholly-owned by any of the fore-
going, or any combination thereof.
‘‘(ii) EMPLOYMENT TEST.—It is rea-
sonably expected (at the time of issuance
of the obligations) that for each $100,000
of net proceeds of the issue at least 1 em-
ployee rendering services at the financed
facilities is an enrolled member of an In-
dian tribe or the spouse of an enrolled
member of an Indian tribe.
‘‘(iii) GAMING.—No part of the issue
of which such bond is a part is used for
property (or any portion thereof) placed in
service for purposes of conducting or hous-
ing class I, II, or III gaming (as defined
in section 4 of the Indian Gaming Regu-
latory Act (25 U.S.C. 2703)).
‘‘(3) DEFINITIONS.—For purposes of this
subsection—
‘‘(A) INDIAN
TRIBE.—The term ‘Indian
tribe’ means any Indian tribe, band, nation,
pueblo, or other organized group or community,
including any Alaska Native village, or regional
or village corporation, as defined in, or estab-
lished pursuant to, the Alaska Native Claims
Settlement Act (43 U.S.C. 1601 et seq.), which
is recognized as eligible for the special pro-
grams and services provided by the United
States to Indians because of their status as In-
dians.
‘‘(B) INDIAN
RESERVATION.—The term
‘Indian reservation’ means a reservation, as de-
fined in—
‘‘(i) section 3(d) of the Indian Financ-
ing Act of 1974 (25 U.S.C. 1452(d)); or
‘‘(ii) section 4(10) of the Indian Child
Welfare 
Act 
of 
1978 
(25 
U.S.C.
1903(10)).
‘‘(C) IN CLOSE PROXIMITY TO.—The term
‘in close proximity to’ means—
‘‘(i) in the case of an Indian reserva-
tion, or portion thereof, located within a
metropolitan statistical area (within the
meaning of section 143(k)(2)(B)), within 1
mile of the boundaries of such reservation,
or portion thereof; and
‘‘(ii) in the case of an Indian reserva-
tion, or portion thereof, located within a
nonmetropolitan area (as defined in section
42(d)(5)(C)(iv)(IV)), within 15 miles of
the boundaries of such reservation, or por-
tion thereof.
‘‘(D) NET PROCEEDS.—The term ‘net pro-
ceeds’ has the meaning given such term by sec-
tion 150(a)(3).’’
(b) CONFORMING AMENDMENT.—Paragraph (3) of
section 149(b) of the Internal Revenue Code of 1986 (re-
lating to federally guaranteed bond is not exempt) is
amended by redesignating subparagraph (D) as subpara-
graph (E) and by inserting after subparagraph (C) the
following new subparagraph:
‘‘(D) EXCEPTION FOR BONDS ISSUED BY
INDIAN TRIBAL GOVERNMENTS.—Paragraph (1)
shall not apply to any bond issued by an Indian
tribal government (or subdivision thereof) un-
less such bond is federally guaranteed within
the meaning of paragraph (2)(B)(ii).’’
SEC. 4. EXEMPTION FROM REGISTRATION REQUIREMENTS.
The first sentence of section 3(a)(2) of the Securities
Act of 1933 (15 U.S.C. 77c(a)(2)) is amended by inserting
‘‘or by any Indian tribal government or subdivision thereof
(within the meaning of section 7871 of the Internal Rev-
enue Code of 1986),’’ after ‘‘or Territories,’’.
SEC. 5. EFFECTIVE DATE.
The amendments made by this Act shall apply to obli-
gations issued after the date of the enactment of this Act.
Æ