SECTION 1. CREDIT FOR DONATION OF LICENSE AND
OTHER 
ASSETS 
OF 
COMMERCIAL 
RADIO
BROADCASTING STATIONS TO NONPROFIT
CORPORATIONS.
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to general business credits) is amended by
adding at the end the following new section:
‘‘SEC. 45D. CREDIT FOR DONATION OF LICENSE AND
OTHER 
ASSETS 
OF 
COMMERCIAL 
RADIO
BROADCASTING STATION TO CERTAIN NON-
PROFIT CORPORATIONS.
‘‘(a) RADIO BROADCASTING STATION DONATION
CREDIT.—For purposes of section 38, the radio broad-
casting station donation credit is an amount equal to the
sum of—
‘‘(1) 125 percent of the fair market value of a
radio broadcasting commercial license which is do-
nated to a qualified recipient,
‘‘(2) 100 percent of the fair market value of
any radio broadcasting station assets, including
equipment and other real property owned by the sta-
tion, which are donated to the same qualified recipi-
ent, and
‘‘(3) the total amount deposited into an oper-
ations escrow fund established by the donor of the
license and assets during the taxable year.
‘‘(b) QUALIFIED RECIPIENT.—For purposes of this
section, a qualified recipient is an entity which—
‘‘(1) is a corporation described in section
501(c)(3) which is exempt from taxation under sec-
tion 501(a),
‘‘(2) agrees to operate the radio broadcasting
station being donated to it as a for-profit venture,
with profits dedicated to the support of non-profit
fine arts and performing arts organizations in its
service area,
‘‘(3) has at least 3 arts organizations from its
service area on its board of trustees, or on a board
of trustees of a subsidiary established to oversee op-
eration of the radio broadcasting station,
‘‘(4) agrees that, in the event that it ceases op-
eration of the radio broadcasting station—
‘‘(A) it will not sell the station to a for-
profit broadcaster under any circumstances,
and
‘‘(B) it will either—
‘‘(i) transfer the license to another
corporation described in section 501(c)(3)
which is exempt from taxation under sec-
tion 501(a) and which agrees to continue
operation of the station for the support of
nonprofit fine arts and performing arts or-
ganizations in its service area, or
‘‘(ii) surrender the license to the Fed-
eral Communications Commission.
‘‘(c) OPERATIONS ESCROW FUND.—
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, an operations escrow fund is a fund established
by a taxpayer who has donated a radio broadcasting
commercial license or radio broadcasting station as-
sets to a qualified recipient for the purpose of cov-
ering operating expenses during the recipient’s first
year of operation of the radio broadcasting station
if the station’s revenues are not adequate to cover
such expenses. An operations escrow fund may be
established only if the qualified recipient is not able
to meet the financial responsibility requirement of
the Federal Communications Commission.
‘‘(2) RECAPTURE OF CREDIT FOR AMOUNTS RE-
MAINING IN ESCROW FUND.—In any case in which
there is an amount remaining in an operations es-
crow fund after the first year of operation of the
radio broadcasting station for which the fund was
established, such amount (not including any interest
that accrued on the amount in the fund) shall be
added to the tax imposed by this chapter on the tax-
payer for the taxpayer’s taxable year which includes
the end of such first year of operation.
‘‘(d) SPECIAL RULES IN CASE OF SURRENDER OF LI-
CENSE TO FCC.—If a qualified recipient surrenders its
donated radio broadcasting license to the Federal Commu-
nications Commission, the Commission shall notify the
donor of the license that the donor may, within 6 months
after such notification, post a bond equal to the amount
of the tax credit under subsection (a) that it received for
donating the station, plus interest. After such a bond is
posted, the donor may apply for the license. If the Com-
mission approves the donor’s application for the license,
the bond shall be used in lieu of an auction fee. If the
donor does not exercise its option within such six months,
or waives its option earlier, the license shall be auctioned
in the same manner as a new license.
‘‘(e) ELECTION.—This section shall apply to any tax-
payer for any taxable year only if such taxpayer elects (at
such time and in such manner as the Secretary may by
regulations prescribe) to have this section apply for such
taxable year.’’.
(b) CONFORMING AMENDMENTS.—
(1) Subsection (b) of section 38 of such Code
is amended by striking ‘‘plus’’ at the end of para-
graph (11), by striking the period at the end of
paragraph (12) and inserting ‘‘, plus’’, and by add-
ing at the end the following new paragraph:
‘‘(13) the radio broadcasting station donation
credit determined under section 45D(a).’’.
(2) 
NO
CARRYBACK
BEFORE
EFFECTIVE
DATE.—Subsection (d) of section 39 of such Code
(relating to carryback and carryforward of unused
credits) is amended by adding at the end the fol-
lowing new paragraph:
‘‘(9) NO CARRYBACK OF SECTION 45D CREDIT
BEFORE EFFECTIVE DATE.—No portion of the un-
used business credit for any taxable year which is
attributable to any credit determined under section
45D may be carried back to a taxable year begin-
ning before January 1, 2000.
(3) The table of sections for subpart D of part
IV of subchapter A of chapter 1 of such Code is
amended by adding at the end the following new
item:
‘‘Sec. 45D. Credit for donation of license and other assets of com-
mercial radio broadcasting stations to certain non-
profit corporations.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 1999.
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