otherwise) shall not be treated as having been 
allocated for purposes of the preceding sen-
tence. 
‘‘(C) DISASTER HOUSING ALLOCATIONS.— 
For purposes of this section— 
‘‘(i) IN GENERAL.—Allocations under 
this paragraph may be made by the Sec-
retary only to States which include a dis-
aster area. 
‘‘(ii) PRIORITY
FOR
HOUSING
LOSS 
DISASTER
AREAS.—In making allocation 
under this paragraph, the Secretary shall 
give priority to housing loss disaster areas. 
‘‘(iii) LIMITATION TO BUILDINGS LO-
CATED
IN
HOUSING
LOSS
DISASTER 
AREAS.—Any allocation of housing credit 
dollar amounts under this paragraph may 
be allocated by such State (or a housing 
credit agency of such State) only to— 
‘‘(I) buildings located in a dis-
aster area, and 
‘‘(II) in the case of any allocation 
made by reason of a priority under 
clause (ii), buildings located in the
housing loss disaster area with respect 
to which such priority was given. 
‘‘(iv) PRO RATA ALLOCATIONS.—The 
allocations made by the Secretary under 
this paragraph shall be made ratably over 
the period described in subparagraph (F) 
unless the Secretary determines, on the 
basis of the severity or frequency of disas-
ters, that a different allocation is appro-
priate. 
‘‘(D) HOUSING
LOSS
DISASTER
AREA.— 
For purposes of this paragraph, the term ‘hous-
ing loss disaster area’ means any county or mu-
nicipality— 
‘‘(i) with respect to which the Gov-
ernor of the State in which such county or 
municipality is located demonstrates to the 
satisfaction of the Secretary that the lesser 
of— 
‘‘(I) 1,000 dwelling units, or 
‘‘(II) 10 percent of the dwelling 
units located in such county or mu-
nicipality, 
have been rendered uninhabitable by rea-
son of damage to or destruction of such
units caused by a federally declared dis-
aster, and 
‘‘(ii) which is located in a disaster 
area. 
‘‘(E) DEFINITIONS AND SPECIAL RULES.— 
For purposes of this paragraph— 
‘‘(i) 
FEDERALLY
DECLARED
DIS-
ASTER; DISASTER AREA.—The terms ‘‘fed-
erally declared disaster’’ and ‘‘disaster 
area’’ shall have the respective meaning 
given such terms by section 165(h)(3)(C). 
‘‘(ii) NO EFFECT ON CARRYOVERS.— 
An allocation of housing credit dollar 
amount to a State under this paragraph 
shall not be taken into account under para-
graph (3). 
‘‘(iii) CONSULTATION WITH FEMA.— 
Any allocation made under this paragraph 
by the Secretary shall be made after con-
sultation with the Director of the Federal 
Emergency Management Agency. 
‘‘(F) TERMINATION.—Allocations under 
this paragraph may be made only with respect 
to disasters occurring during the period begin-
ning on January 1, 2008, and ending on De-
cember 31, 2011. No allocation under this 
paragraph may be made to any building after 
December 31, 2012.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to allocations made after the date 
of the enactment of this Act. 
SEC. 8. PRIVATE ACTIVITY DISASTER BONDS. 
(a) IN GENERAL.—Section 144 is amended by adding 
at the end the following new subsection: 
‘‘(d) QUALIFIED DISASTER BOND.— 
‘‘(1) IN GENERAL.—For purposes of this part, 
the term ‘qualified disaster bond’ means any bond 
issued as part of an issue if— 
‘‘(A) 95 percent or more of the net pro-
ceeds of the issue are to be used for the re-
placement, repair, reconstruction, or renovation 
of property of a character subject to the allow-
ance for depreciation which was damaged or de-
stroyed as a result of a federally declared dis-
aster, and 
‘‘(B) such bond is designated by a State 
for purposes of this subsection. 
‘‘(2) DESIGNATION OF BONDS.— 
‘‘(A) DESIGNATION BY STATE.—The max-
imum aggregate face amount of bonds des-
ignated under paragraph (1)(B) by any State 
may not exceed the bond limitation allocated to 
such State by the Secretary under subpara-
graph (B). 
‘‘(B) ALLOCATION
OF
BOND
LIMITA-
TION.— 
‘‘(i) IN
GENERAL.—The Secretary 
may, upon application by any State, make 
allocation of bond limitation to such State 
if such State includes a disaster area. 
‘‘(ii) 
LIMITATION.—The 
aggregate 
amount of bond limitation allocated to the 
States by the Secretary under clause (i) 
may not exceed $13,000,000,000. Any allo-
cation which is terminated by the Sec-
retary (by reason of disuse or otherwise) 
shall not be treated as having been allo-
cated for purposes of the preceding sen-
tence. 
‘‘(iii) PRIORITY FOR BUSINESS LOSS 
DISASTER
AREAS.—In making allocation 
under this subsection, the Secretary shall 
give priority to business loss disaster areas. 
‘‘(iv) LIMITATION TO BUILDINGS LO-
CATED
IN
BUSINESS
LOSS
DISASTER