I 
115TH CONGRESS 
2D SESSION 
H. R. 7375 
To eliminate certain tax breaks and benefits and use the savings for invest-
ment in affordable housing for extremely low- and very low-income fami-
lies, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 20, 2018 
Ms. JONES of Michigan (for herself and Mrs. LAWRENCE) introduced the fol-
lowing bill; which was referred to the Committee on Ways and Means, 
and in addition to the Committees on Natural Resources, Financial Serv-
ices, and the Budget, for a period to be subsequently determined by the 
Speaker, in each case for consideration of such provisions as fall within 
the jurisdiction of the committee concerned 
A BILL 
To eliminate certain tax breaks and benefits and use the 
savings for investment in affordable housing for ex-
tremely low- and very low-income families, 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; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Stronger, Healthier Environment for Low-Income Ten-
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ants and Economic Renewal Act of 2018’’ or the ‘‘SHEL-
TER Act of 2018’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
TITLE I—ELIMINATING FOSSIL FUEL TAX BREAKS 
Sec. 101. Modifications of foreign tax credit rules applicable to major inte-
grated oil companies which are dual capacity taxpayers. 
Sec. 102. Limitation on deduction for intangible drilling and development costs; 
amortization of disallowed amounts. 
Sec. 103. Limitation on percentage depletion allowance for oil and gas wells. 
Sec. 104. Limitation on deduction for tertiary injectants. 
Sec. 105. Modification of definition of major integrated oil company. 
TITLE II—OUTER CONTINENTAL SHELF OIL AND NATURAL GAS 
Sec. 201. Repeal of outer Continental Shelf deep water and deep gas royalty 
relief. 
TITLE III—INVESTMENT IN AFFORDABLE HOUSING 
Sec. 301. Use of savings for Housing Trust Fund investment. 
Sec. 302. Treatment of area median incomes and income ceilings. 
TITLE IV—BUDGETARY EFFECTS 
Sec. 401. Compliance with Pay-Go. 
TITLE I—ELIMINATING FOSSIL 
FUEL TAX BREAKS 
SEC. 101. MODIFICATIONS OF FOREIGN TAX CREDIT RULES 
APPLICABLE TO MAJOR INTEGRATED OIL 
COMPANIES WHICH ARE DUAL CAPACITY 
TAXPAYERS. 
(a) IN GENERAL.—Section 901 of the Internal Rev-
enue Code of 1986 is amended by redesignating subsection 
(n) as subsection (o) and by inserting after subsection (m) 
the following new subsection: 
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‘‘(n) SPECIAL RULES RELATING TO MAJOR INTE-
GRATED OIL COMPANIES WHICH ARE DUAL CAPACITY 
TAXPAYERS.— 
‘‘(1) GENERAL
RULE.—Notwithstanding any 
other provision of this chapter, any amount paid or 
accrued by a dual capacity taxpayer which is a 
major integrated oil company (within the meaning of 
section 167(h)(5)) to a foreign country or possession 
of the United States for any period shall not be con-
sidered a tax— 
‘‘(A) if, for such period, the foreign coun-
try or possession does not impose a generally 
applicable income tax, or 
‘‘(B) to the extent such amount exceeds 
the amount (determined in accordance with reg-
ulations) which— 
‘‘(i) is paid by such dual capacity tax-
payer pursuant to the generally applicable 
income tax imposed by the country or pos-
session, or 
‘‘(ii) would be paid if the generally ap-
plicable income tax imposed by the country 
or possession were applicable to such dual 
capacity taxpayer. 
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Nothing in this paragraph shall be construed to 
imply the proper treatment of any such amount not 
in excess of the amount determined under subpara-
graph (B). 
‘‘(2) DUAL
CAPACITY
TAXPAYER.—For pur-
poses of this subsection, the term ‘dual capacity tax-
payer’ means, with respect to any foreign country or 
possession of the United States, a person who— 
‘‘(A) is subject to a levy of such country or 
possession, and 
‘‘(B) receives (or will receive) directly or 
indirectly a specific economic benefit (as deter-
mined in accordance with regulations) from 
such country or possession. 
‘‘(3) GENERALLY APPLICABLE INCOME TAX.— 
For purposes of this subsection— 
‘‘(A) IN
GENERAL.—The term ‘generally 
applicable income tax’ means an income tax (or 
a series of income taxes) which is generally im-
posed under the laws of a foreign country or 
possession on income derived from the conduct 
of a trade or business within such country or 
possession. 
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‘‘(B) EXCEPTIONS.—Such term shall not 
include a tax unless it has substantial applica-
tion, by its terms and in practice, to— 
‘‘(i) persons who are not dual capacity 
taxpayers, and 
‘‘(ii) persons who are citizens or resi-
dents of the foreign country or posses-
sion.’’. 
(b) EFFECTIVE DATE.— 
(1) IN GENERAL.—The amendments made by 
this section shall apply to taxes paid or accrued in 
taxable years beginning after the date of the enact-
ment of this Act. 
(2) 
CONTRARY
TREATY
OBLIGATIONS 
UPHELD.—The amendments made by this section 
shall not apply to the extent contrary to any treaty 
obligation of the United States. 
SEC. 102. LIMITATION ON DEDUCTION FOR INTANGIBLE 
DRILLING AND DEVELOPMENT COSTS; AMOR-
TIZATION OF DISALLOWED AMOUNTS. 
(a) IN GENERAL.—Section 263(c) of the Internal 
Revenue Code of 1986 is amended to read as follows: 
‘‘(c) INTANGIBLE DRILLING
AND DEVELOPMENT 
COSTS IN THE CASE OF OIL AND GAS WELLS AND GEO-
THERMAL WELLS.— 
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‘‘(1) IN GENERAL.—Notwithstanding subsection 
(a), and except as provided in subsection (i), regula-
tions shall be prescribed by the Secretary under this 
subtitle corresponding to the regulations which 
granted the option to deduct as expenses intangible 
drilling and development costs in the case of oil and 
gas wells and which were recognized and approved 
by the Congress in House Concurrent Resolution 50, 
Seventy-ninth Congress. Such regulations shall also 
grant the option to deduct as expenses intangible 
drilling and development costs in the case of wells 
drilled for any geothermal deposit (as defined in sec-
tion 613(e)(2)) to the same extent and in the same 
manner as such expenses are deductible in the case 
of oil and gas wells. This subsection shall not apply 
with respect to any costs to which any deduction is 
allowed under section 59(e) or 291. 
‘‘(2) EXCLUSION.— 
‘‘(A) IN GENERAL.—This subsection shall 
not apply to amounts paid or incurred by a tax-
payer in any taxable year in which such tax-
payer is a major integrated oil company (within 
the meaning of section 167(h)(5)). 
‘‘(B) AMORTIZATION OF AMOUNTS NOT AL-
LOWABLE
AS
DEDUCTIONS
UNDER
SUBPARA-
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GRAPH (A).—The amount not allowable as a de-
duction for any taxable year by reason of sub-
paragraph (A) shall be allowable as a deduction 
ratably over the 60-month period beginning 
with the month in which the costs are paid or 
incurred. For purposes of section 1254, any de-
duction under this subparagraph shall be treat-
ed as a deduction under this subsection.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to amounts paid or incurred in tax-
able years beginning after December 31, 2018. 
SEC. 103. LIMITATION ON PERCENTAGE DEPLETION AL-
LOWANCE FOR OIL AND GAS WELLS. 
(a) IN GENERAL.—Section 613A of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new subsection: 
‘‘(f) APPLICATION WITH RESPECT TO MAJOR INTE-
GRATED OIL COMPANIES.—In the case of any taxable year 
in which the taxpayer is a major integrated oil company 
(within the meaning of section 167(h)(5)), the allowance 
for percentage depletion shall be zero.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2018. 
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SEC. 104. LIMITATION ON DEDUCTION FOR TERTIARY 
INJECTANTS. 
(a) IN GENERAL.—Section 193 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new subsection: 
‘‘(d) APPLICATION WITH RESPECT TO MAJOR INTE-
GRATED OIL COMPANIES.— 
‘‘(1) IN GENERAL.—This section shall not apply 
to amounts paid or incurred by a taxpayer in any 
taxable year in which such taxpayer is a major inte-
grated oil company (within the meaning of section 
167(h)(5)). 
‘‘(2) AMORTIZATION OF AMOUNTS NOT ALLOW-
ABLE AS DEDUCTIONS UNDER PARAGRAPH (1).—The 
amount not allowable as a deduction for any taxable 
year by reason of paragraph (1) shall be allowable 
as a deduction ratably over the 60-month period be-
ginning with the month in which the costs are paid 
or incurred.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to amounts paid or incurred in tax-
able years beginning after December 31, 2018. 
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SEC. 105. MODIFICATION OF DEFINITION OF MAJOR INTE-
GRATED OIL COMPANY. 
(a) IN GENERAL.—Paragraph (5) of section 167(h) 
of the Internal Revenue Code of 1986 is amended by add-
ing at the end the following new subparagraph: 
‘‘(C) CERTAIN
SUCCESSORS
IN
INTER-
EST.—For purposes of this paragraph, the term 
‘major integrated oil company’ includes any 
successor in interest of a company that was de-
scribed in subparagraph (B) in any taxable 
year, if such successor controls more than 50 
percent of the crude oil production or natural 
gas production of such company.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) IN GENERAL.—Subparagraph (B) of section 
167(h)(5) of the Internal Revenue Code of 1986 is 
amended by inserting ‘‘except as provided in sub-
paragraph (C),’’ after ‘‘For purposes of this para-
graph,’’. 
(2) TAXABLE YEARS TESTED.—Clause (iii) of 
section 167(h)(5)(B) of such Code is amended— 
(A) by striking ‘‘does not apply by reason 
of paragraph (4) of section 613A(d)’’ and in-
serting ‘‘did not apply by reason of paragraph 
(4) of section 613A(d) for any taxable year 
after 2004’’; and 
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(B) by striking ‘‘does not apply’’ in sub-
clause (II) and inserting ‘‘did not apply for the 
taxable year’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2018. 
TITLE II—OUTER CONTINENTAL 
SHELF OIL AND NATURAL GAS 
SEC. 201. REPEAL OF OUTER CONTINENTAL SHELF DEEP 
WATER AND DEEP GAS ROYALTY RELIEF. 
(a) IN GENERAL.—Sections 344 and 345 of the En-
ergy Policy Act of 2005 (42 U.S.C. 15904, 15905) are 
repealed. 
(b) ADMINISTRATION.—The Secretary of the Interior 
shall not be required to provide for royalty relief in the 
lease sale terms beginning with the first lease sale held 
on or after the date of enactment of this Act for which 
a final notice of sale has not been published. 
TITLE III—INVESTMENT IN 
AFFORDABLE HOUSING 
SEC. 301. USE OF SAVINGS FOR HOUSING TRUST FUND IN-
VESTMENT. 
(a) USE OF SAVINGS.—For each of the years 2019 
through 2028, the Secretary of the Treasury shall deter-
mine the amount of revenues accruing to the general fund 
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of the Treasury by reason of the enactment of titles I and 
II of this Act and shall credit an amount equal to such 
revenues to the Housing Trust Fund established under 
section 1338 of the Federal Housing Enterprises Finan-
cial Safety and Soundness Act of 1992 (12 U.S.C. 4568). 
(b) 
ENVIRONMENTAL
REHABILITATION
ACTIVI-
TIES.—Of any amount credited to the Housing Trust 
Fund for a year pursuant to subsection (a), 10 percent 
shall be allocated for and distributed to States, in accord-
ance with the formula established pursuant to subsection 
(c)(3) of such section 1338, for use only to conduct activi-
ties to remediate environmental hazards, including activi-
ties for reduction, elimination, and abatement of lead- 
based paint hazards, in housing for extremely low- and 
very low-income households. 
(c) CHILDHOOD LEAD PREVENTION.—Section 1338 
(g)(2)(D) of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 
4568(g)(2)(D)) is amended— 
(1) in clause (v), by striking ‘‘and’’ at the end; 
(2) in clause (vi), by striking the period at the 
end and inserting ‘‘; and’’; and 
(3) by adding at the end the following new 
clause: 
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‘‘(vii) the ratio of children living in an 
applicant’s jurisdiction that suffer from 
blood lead levels higher than 5 micrograms 
per deciliter.’’. 
SEC. 302. TREATMENT OF AREA MEDIAN INCOMES AND IN-
COME CEILINGS. 
Subparagraph (D) of section 3(b)(2) of the United 
States Housing Act of 1937 (42 U.S.C. 1437a(b)(2)(D)) 
is amended— 
(1) in the second sentence, by inserting ‘‘and 
Wayne County in the State of Michigan,’’ after 
‘‘State of New York,’’; 
(2) in the third sentence, by striking ‘‘such 
metropolitan statistical area’’ and inserting ‘‘the 
metropolitan statistical area in which Westchester 
and Rockland Counties are located but’’; and 
(3) by inserting after the period at the end of 
the third sentence the following: ‘‘In determining 
such area median incomes or establishing such in-
come ceilings or limits for the portion of the metro-
politan statistical area in which Wayne County is lo-
cated but that does not include Wayne County, the 
Secretary shall determine or establish area median 
incomes and income ceilings and limits as if such 
portion included Wayne County. In determining such 
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income ceilings or limits for the portion of such met-
ropolitan statistical areas that include Detroit, 
Michigan, the Secretary shall determine for units in 
Detroit such income ceilings or limits exclusive of 
Livonia, Michigan.’’. 
TITLE IV—BUDGETARY EFFECTS 
SEC. 401. COMPLIANCE WITH PAY-GO. 
The budgetary effects of this Act, for the purpose of 
complying with the Statutory Pay-As-You-Go Act of 2010, 
shall be determined by reference to the latest statement 
titled ‘‘Budgetary Effects of PAYGO Legislation’’ for this 
Act, submitted for printing in the Congressional Record 
by the Chairman of the Senate Budget Committee, pro-
vided that such statement has been submitted prior to the 
vote on passage. 
Æ 
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