I
106TH CONGRESS
2D SESSION
H. R. 5634
To amend the Internal Revenue Code of 1986 to provide a rehabilitation
credit for certain expenditures to rehabilitate historic performing arts
facilities.
IN THE HOUSE OF REPRESENTATIVES
NOVEMBER 14, 2000
Mr. HOUGHTON (for himself and Mr. RANGEL) 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
a rehabilitation credit for certain expenditures to reha-
bilitate historic performing arts facilities.
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 ‘‘Historic Performing
Arts Facility Rehabilitation Act’’.
SEC. 2. HISTORIC PERFORMING ARTS FACILITY REHABILI-
TATION CREDIT.
(a) IN GENERAL.—Section 47 of the Internal Rev-
enue Code of 1986 (relating to rehabilitation credit) is
amended by adding at the end the following new sub-
section.
‘‘(e) HISTORIC PERFORMING ARTS FACILITY REHA-
BILITATION CREDIT.—
‘‘(1) IN GENERAL.—In lieu of the credit other-
wise allowable under this section, a qualified per-
forming arts institution shall receive a historic reha-
bilitation credit certificate.
‘‘(2) HISTORIC REHABILITATION CREDIT CER-
TIFICATE.—For purposes of this subsection, the
term ‘historic rehabilitation credit certificate’ means
a certificate—
‘‘(A) issued to a qualified performing arts
institution, in accordance with procedures pre-
scribed by the Secretary, with respect to a cer-
tified rehabilitation,
‘‘(B) the face amount of which shall be
equal to the credit which would (but for this
subsection) be allowable under subsection (a) to
the taxpayer with respect to such rehabilitation,
‘‘(C) which may only be transferred by the
qualified performing arts institution to a lend-
ing institution (including a non-depository insti-
tution) in connection with a loan—
‘‘(i) the proceeds of which may not be
used for any purpose other than the reha-
bilitation of the historic performing arts
facility to which the credit relates, and
‘‘(ii) the duration of which shall not
exceed the anticipated duration of the re-
habilitation, and
‘‘(D) in exchange for which such lending
institution provides the qualified performing
arts institution—
‘‘(i) a reduction in the rate of interest
on the loan which results in interest pay-
ment reductions which are substantially
equivalent on a present value basis to the
face amount of such certificate, and
‘‘(ii) to the extent of any amount of
such certificate not applied under clause
(i), a reduction in the principal amount of
the loan in an amount substantially equiva-
lent on a present value basis to the face
amount of such certificate so applied.
‘‘(3) USE OF HISTORIC REHABILITATION CRED-
IT CERTIFICATE BY LENDER.—The amount of credit
specified in the certificate and transferred to the
lender shall be allowed to the lender only to offset
the regular tax (as defined in section 55(c)) of such
lender. The lender may carryforward all unused
amounts under this subsection until exhausted.
‘‘(4) HISTORIC REHABILITATION CREDIT NOT
TREATED AS UNRELATED BUSINESS TAXABLE IN-
COME.—Notwithstanding any other provision of law,
no benefit accruing to the qualified performing arts
institution through the use of a historic rehabilita-
tion credit certificate shall be treated as unrelated
business taxable income for purposes of this title.’’.
(b) HISTORIC PERFORMING ARTS FACILITY.—Sec-
tion 47(c) of the Internal Revenue Code of 1986 (relating
to definitions) is amended by adding at the end the fol-
lowing new paragraph:
‘‘(4) HISTORIC PERFORMING ARTS FACILITY.—
‘‘(A) IN
GENERAL.—The term ‘historic
performing arts facility’ means any building
and related improvements (including public pla-
zas and concourses, vehicular and pedestrian
passageways, mechanical installations, garages,
and other related structures and facilities)
which is—
‘‘(i) a certified historic structure,
‘‘(ii) owned by, or leased or licensed
to, one or more qualified performing arts
institutions, and
‘‘(iii) used for—
‘‘(I) the presentation or produc-
tion of the performing arts,
‘‘(II) education, training, or the
presentation of educational programs
in the performing arts,
‘‘(III) research in, archiving of
records pertaining to, or operation of
public libraries for the performing
arts, or
‘‘(IV) office and other functions
related to an activity described in sub-
clause (I), (II), or (III).
‘‘(B) QUALIFIED PERFORMING ARTS INSTI-
TUTION.—The term ‘qualified performing arts
institution’ means any organization described in
section 501(c) and exempt from tax under sec-
tion 501(a) which is organized and operated to
present, produce, advance, teach or otherwise
facilitate the performing arts.
‘‘(C) PERFORMING ARTS.—The term ‘per-
forming arts’ means the performance, playing,
presentation, 
dissemination, 
recording, 
re-
hearsal, or creation of any type of music, the-
ater, drama, dance, opera, cabaret, film, video,
radio, or other art forms.’’.
(c) QUALIFIED REHABILITATION EXPENSES.—Sec-
tion 47(c)(2)(B) of the Internal Revenue Code of 1986
(relating to certain expenditures not included) is amended
by adding at the end the following new clause:
‘‘(vii) SPECIAL RULES FOR QUALIFIED
PERFORMING ARTS INSTITUTIONS.—
‘‘(I) GRANTS.—Any expenditure
by a qualified performing arts institu-
tion to rehabilitate an historic per-
forming arts facility to the extent
such expenditure is funded by any
grant from a Federal, State, or local
government in connection with the re-
habilitation of such facility.
‘‘(II) EXPENDITURE
OF
LES-
SEE.—For purposes of clause (vi), a
qualified performing arts institution
that leases or licenses an historic per-
forming arts facility from a person
other than a qualified performing arts
institution shall be treated as the
owner of the facility.
‘‘(III) ENLARGEMENT; TAX-EX-
EMPT PROPERTY.—In the case of any
expenditure in connection with an his-
toric performing arts facility, clauses
(iii) and (v) shall not apply.’’.
(d) REHABILITATION CREDIT FOR PROPERTY USED
BY CERTAIN TAX EXEMPT ORGANIZATIONS.—Section
50(b)(3) of the Internal Revenue Code of 1986 (relating
to property used by certain tax-exempt organizations) is
amended by adding at the end the following new sentence:
‘‘This paragraph shall not apply in the case of a rehabilita-
tion credit determined under section 47(a) with respect
to qualified rehabilitation expenditures (as defined in sec-
tion 47(c)) paid or incurred with respect to an historic
performing arts facility (as so defined).’’.
(e) EFFECTIVE DATE.—The amendments made by
this section shall apply with respect to a rehabilitation the
physical work on which begins after the date of the enact-
ment of this Act.
Æ