I
105TH CONGRESS
2D SESSION
H. R. 4247
To allow a credit against income tax for contributions used for the
construction and renovation of public schools in certain high school districts.
IN THE HOUSE OF REPRESENTATIVES
JULY 16, 1998
Mr. COSTELLO (for himself and Mr. POSHARD) introduced the following bill;
which was referred to the Committee on Ways and Means
A BILL
To allow a credit against income tax for contributions used
for the construction and renovation of public schools
in certain high school districts.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. CREDIT FOR CONTRIBUTIONS TO CERTAIN
HIGH SCHOOL DISTRICTS.
(a) IN GENERAL.—For purposes of section 38 of the
Internal Revenue Code of 1986, the current year business
credit shall include the credit determined under this sec-
tion.
(b) DETERMINATION OF CREDIT.—The credit deter-
mined under this section for each taxable year in the credit
period is an amount equal to 7 percent of each qualified
contribution made by the taxpayer.
(c) CREDIT PERIOD.—For purposes of this section,
the credit period with respect to any qualified contribution
is the period of 10 taxable years beginning with the tax-
able year during which such contribution was made.
(d) QUALIFIED CONTRIBUTION.—For purposes of
this section—
(1) IN
GENERAL.—The term ‘‘qualified con-
tribution’’ means any transfer of cash—
(A) which is made to a selected high school
district during the 5-year period beginning on
the date such district is selected for purposes of
this section,
(B) which is available for use by such dis-
trict for at least 10 years,
(C) which is to be used by such district to
construct, renovate, or repair a high school fa-
cility which serves grades 9 through 12, and
(D) which is designated by such district
for purposes of this section.
(2) LIMITATION
ON
AMOUNT
DESIGNATED.—
The aggregate amount of contributions to a selected
high school district which may be designated under
this section by such district shall not exceed the less-
er of)
(A) $36,000,000, or
(B) 70 percent of the cost of the construc-
tion, renovation, or repair referred to in para-
graph (1)(C).
(e) SELECTED HIGH SCHOOL DISTRICT.—
(1) IN GENERAL.—For purposes of this section,
the term ‘‘selected high school district’’ means any
high school district selected by the Secretary of Edu-
cation.
(2) NUMBER OF DISTRICTS SELECTED, ETC.—
(A) IN GENERAL.—The Secretary of Edu-
cation may designate 4 high school districts for
purposes of this section, subject to the availabil-
ity of eligible high school districts. Such selec-
tions shall be made before October 1, 1998.
(B) MINIMUM
SELECTION.—At least 1
high school district selected under this section
shall be a high school district—
(i) which is outside a metropolitan
statistical area,
(ii) which has been designated as a
Champion Community by the Department
of Agriculture under the Empowerment
Zone and Enterprise Community program,
and
(iii) which proposes to use contribu-
tions under this section to construct a high
school facility in a municipality having a
population of less than 30,000.
(3) SELECTED HIGH SCHOOL DISTRICTS MUST
HAVE
CERTAIN
CHARACTERISTICS.—A high school
district may be selected under this section only if—
(A) the high school facility proposed to be
constructed, renovated, or repaired by such dis-
trict with contributions to which this section ap-
plies is located in a municipality with—
(i) a poverty rate of at least 45 per-
cent, and
(ii) a per capita income of $9,000 or
less,
(B) it is reasonably expected that at least
20 percent of the students to be enrolled in
such facility (for the first school year beginning
after the completion of such construction, ren-
ovation, or repair) will be students who applied,
and were determined to be eligible, for free or
reduced-price meals during the 1997–98 school
year under the eligibility guidelines of the De-
partment of Agriculture applicable to the 1-year
period beginning July, 1, 1997, and
(C) such facility will, in addition to being
used as a high school, be used for community
recreational and other community purposes.
A facility shall not fail to be treated as a high school
facility for purposes of this section by reason of com-
munity use.
(4) POPULATION AND POVERTY RATE.—Popu-
lation and poverty rate shall be determined by the
1990 Census of Population and Housing.
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