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‘‘(II) for which a request is made
(not later than May 1 of the calendar
year) to receive an allocation under
clause (iii).
‘‘(E) STATE MAY PROVIDE FOR DIFFERENT
ALLOCATION.—Rules similar to the rules of sec-
tion 146(e) (other than paragraph (2)(B) there-
of) shall apply for purposes of this paragraph.
‘‘(F) POPULATION.—For purposes of this
paragraph, population shall be determined in ac-
cordance with section 146(j).
‘‘(G) COST-OF-LIVING ADJUSTMENT.—
‘‘(i) IN GENERAL.—In the case of a
calendar year after 2005, the $185,000
amount in subparagraph (C) shall be in-
creased by an amount equal to—
‘‘(I) such dollar amount, multi-
plied by
‘‘(II) the cost-of-living adjustment
determined under section 1(f )(3) for
such calendar year by substituting ‘cal-
endar year 2004’ for ‘calendar year
1992’ in subparagraph (B) thereof.
‘‘(ii) ROUNDING.—Any increase under
clause (i) which is not a multiple of $5,000
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shall be rounded to the next lowest multiple
of $5,000.
‘‘(4) PORTION OF STATE CEILING SET-ASIDE FOR
CERTAIN
INVESTMENT
PROJECTS
INVOLVING
QUALI-
FIED NONPROFIT ORGANIZATIONS.—
‘‘(A) IN GENERAL.—At least 10 percent of
the State rural investment credit ceiling for any
State for any calendar year shall be allocated to
qualified rural investment projects described in
subparagraph (B).
‘‘(B) INVESTMENT
PROJECTS
INVOLVING
QUALIFIED
NONPROFIT
ORGANIZATIONS.—For
purposes of subparagraph (A), a qualified rural
investment project is described in this subpara-
graph if a qualified nonprofit organization is to
materially participate (within the meaning of
section 469(h)) in the development and operation
of the investment project throughout the compli-
ance period.
‘‘(C) QUALIFIED
NONPROFIT
ORGANIZA-
TION.—For purposes of this paragraph, the term
‘qualified nonprofit organization’ means any or-
ganization if—
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‘‘(i) such organization is described in
any paragraph of section 501(c) and is ex-
empt from tax under section 501(a),
‘‘(ii) such organization is determined
by the State rural investment credit agency
not to be affiliated with or controlled by a
for-profit organization; and
‘‘(iii) 1 of the exempt purposes of such
organization includes the fostering of rural
investment.
‘‘(D) TREATMENT
OF
CERTAIN
SUBSIDI-
ARIES.—
‘‘(i) IN
GENERAL.—For purposes of
this paragraph, a qualified nonprofit orga-
nization shall be treated as satisfying the
ownership and material participation test
of subparagraph (B) if any qualified cor-
poration in which such organization holds
stock satisfies such test.
‘‘(ii) QUALIFIED
CORPORATION.—For
purposes of clause (i), the term ‘qualified
corporation’ means any corporation if 100
percent of the stock of such corporation is
held by 1 or more qualified nonprofit orga-
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nizations at all times during the period
such corporation is in existence.
‘‘(E) STATE
MAY
NOT
OVERRIDE
SET-
ASIDE.—Nothing in subparagraph (F) of para-
graph (3) shall be construed to permit a State
not to comply with subparagraph (A) of this
paragraph.
‘‘(F) CREDITS FOR QUALIFIED NONPROFIT
ORGANIZATIONS.—
‘‘(i) ALLOWANCE
OF
CREDIT.—Any
credit which would be allowable under sub-
section (a) with respect to a qualified rural
investment building of a qualified nonprofit
organization if such organization were not
exempt from tax under this chapter shall be
treated as a credit allowable under subpart
C to such organization.
‘‘(ii) USE
OF
CREDIT.—A qualified
nonprofit organization may assign, trade,
sell, or otherwise transfer any credit allow-
able to such organization under subpara-
graph (A) to any taxpayer.
‘‘(iii) CREDIT NOT INCOME.—A trans-
fer under subparagraph (B) of any credit
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allowable under subparagraph (A) shall not
result in income for purposes of section 511.
‘‘(5) SPECIAL RULES.—
‘‘(A) BUILDING MUST BE LOCATED WITHIN
JURISDICTION OF CREDIT AGENCY.—A rural in-
vestment credit agency may allocate its aggregate
rural investment credit dollar amount only to
buildings located in the jurisdiction of the gov-
ernmental unit of which such agency is a part.
‘‘(B) AGENCY ALLOCATIONS IN EXCESS OF
LIMIT.—If the aggregate rural investment credit
dollar amounts allocated by a rural investment
credit agency for any calendar year exceed the
portion of the State rural investment credit ceil-
ing allocated to such agency for such calendar
year, the rural investment credit dollar amounts
so allocated shall be reduced (to the extent of
such excess) for buildings in the reverse of the
order in which the allocations of such amounts
were made.
‘‘(C) CREDIT
REDUCED
IF
ALLOCATED
CREDIT DOLLAR AMOUNT IS LESS THAN CREDIT
WHICH
WOULD
BE
ALLOWABLE
WITHOUT
RE-
GARD TO SALES CONVENTION, ETC.—