I
104TH CONGRESS
1ST SESSION
H. R. 2015
To amend the Internal Revenue Code of 1986 to provide tax incentives
for the economic recovery of areas affected by the loss of employment
in the financial institution and real estate sectors.
IN THE HOUSE OF REPRESENTATIVES
JULY 11, 1995
Mrs. KENNELLY introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to provide
tax incentives for the economic recovery of areas affected
by the loss of employment in the financial institution
and real estate sectors.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Financial Institution
and Real Estate (FIRE) Relief Act of 1995’’.
SEC. 2. DESIGNATION AND TREATMENT OF ECONOMIC RE-
COVERY AREAS.
(a) IN GENERAL.—Chapter 1 of the Internal Reve-
nue Code of 1986 is amended by adding at the end the
following new subchapter:
‘‘Subchapter W—Designation and
Treatment of Economic Recov-
ery Areas
‘‘Part I. Designation.
‘‘Part II. Incentives.
‘‘PART I—DESIGNATION
‘‘Sec. 1399A. Designation procedure.
‘‘Sec. 1399B. Eligibility criteria; definitions and special rules.
‘‘SEC. 1399A. DESIGNATION PROCEDURE.
‘‘(a) IN GENERAL.—From among the areas nomi-
nated for designation under this section, the Secretary
may designate 3 nominated areas as economic recovery
areas.
‘‘(b) PERIOD DESIGNATIONS MAY BE MADE.—A des-
ignation may be made under this section only during the
1-year period beginning on the date of the enactment of
this subchapter.
‘‘(c) PERIOD FOR WHICH DESIGNATION IS IN EF-
FECT.—
‘‘(1) IN GENERAL.—Any designation under this
section shall remain in effect during the period be-
ginning on the date of the designation and ending
on the earliest of—
‘‘(A) the close of the 10th calendar year
beginning on or after such date of designation,
‘‘(B) the termination date designated by
the State and local governments as provided for
in their nomination, or
‘‘(C) the date the Secretary revokes the
designation.
‘‘(2) REVOCATION OF DESIGNATION.—The Sec-
retary may revoke the designation under this section
of an area under rules similar to the rules of section
1391(d)(2).
‘‘(d) OTHER RULES TO APPLY.—Rules similar to the
rules of subsections (e) and (f) of section 1391 shall apply
for purposes of the designation under this section.
‘‘SEC. 1399B. ELIGIBILITY CRITERIA; DEFINITIONS AND
SPECIAL RULES.
‘‘(a) IN GENERAL.—A nominated area shall be eligi-
ble for designation under section 1399A only if it meets
the following criteria:
‘‘(1) ENTERPRISE ZONE CRITERIA.—The nomi-
nated area is an urban area which meets the criteria
under section 1392 for urban areas (determined
without regard to section 1392(a)(3)(D) thereof).
‘‘(2) EMPLOYMENT LOSSES IN FINANCIAL IN-
STITUTION AND REAL ESTATE SECTORS.—With re-
spect to the nominated area—
‘‘(A) at least 12 percent of the wages at-
tributable to private, nonagricultural employ-
ment in the area during 1989, and subject to
tax under section 3301 during such year, were
in the financial institution and real estate sec-
tors, and
‘‘(B) the employment in such area in such
sectors for the calendar year preceding the cal-
endar year in which such area is nominated for
designation is 10 percent (or, if lesser, 5,000
full-time equivalent jobs) less than such employ-
ment during 1989.
The requirement of subparagraph (B) shall not be
met if substantially all of such decline in employ-
ment is attributable to 1 employer. Data for the
labor market area which includes the nominated
area may be used for purposes of this paragraph if
data is not separately available for the nominated
area.
‘‘(b) DEFINITIONS.—For purposes of this sub-
chapter—
‘‘(1) ECONOMIC
RECOVERY
AREA.—The term
‘economic recovery area’ means an area designated
as such under section 1399A.
‘‘(2) FINANCIAL INSTITUTION.—The term ‘fi-
nancial institution’ includes any bank, any insurance
company, and any trade or business of performing
brokerage services.
‘‘(3) URBAN
AREA.—The term ‘urban area’
means an area which is not a rural area (as defined
in section 1393(a)(2)).
‘‘(4) 
OTHER
DEFINITIONS
AND
SPECIAL
RULES.—Rules similar to the rules of paragraphs
(4) through (9) of section 1393(a) shall apply for
purposes of this subchapter.
‘‘PART II—INCENTIVES
‘‘Sec. 1399D. Economic recovery area employment credit.
‘‘Sec. 1399E. Reduction in capital gains tax on equity invest-
ments in area businesses.
‘‘Sec. 1399F. Other incentives.
‘‘SEC. 1399D. ECONOMIC RECOVERY AREA EMPLOYMENT
CREDIT.
‘‘(a) AMOUNT OF CREDIT.—For purposes of section
38, the amount of the economic recovery area employment
credit determined under this section with respect to any
employer for any taxable year is 20 percent of the quali-
fied area wages paid or incurred during the calendar year
which ends with or within such taxable year.