I 
108TH CONGRESS 
2D SESSION 
H. R. 4480
To amend the Internal Revenue Code of 1986 to allow taxpayers a credit 
against income tax for expenditures to remediate contaminated sites. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 2, 2004
Mr. TURNER of Ohio (for himself, Mr. BOEHNER, Mr. BRADLEY of New 
Hampshire, Mr. CHABOT, Mr. CHOCOLA, Mr. ENGLISH, Mr. GERLACH, 
Mr. GILLMOR, Ms. HART, Mr. HOBSON, Mr. HOEKSTRA, Mrs. JOHNSON 
of Connecticut, Mr. KLINE, Mr. LATOURETTE, Mr. NEY, Mr. OXLEY, 
Mr. PORTMAN, Ms. PRYCE of Ohio, Mr. REGULA, Mr. ROGERS of Michi-
gan, Mr. SHAYS, Mr. TIBERI, Mrs. JONES of Ohio, and Mr. WALSH) in-
troduced the following bill; which was referred to the Committee on Ways 
and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to allow tax-
payers a credit against income tax for expenditures to 
remediate contaminated sites.
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 ‘‘Brownfields Revitaliza-
tion Act of 2004’’.
SEC. 2. CREDIT FOR EXPENDITURES TO REMEDIATE CON-
TAMINATED SITES. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to business related credits) is amended by 
adding at the end the following new section: 
‘‘SEC. 45G. ENVIRONMENTAL REMEDIATION CREDIT. 
‘‘(a) IN GENERAL.—For purposes of section 38, the 
environmental remediation credit determined under this 
section is 50 percent of the qualified remediation expendi-
tures paid or incurred by the taxpayer during the taxable 
year with respect to a qualified contaminated site located 
in an eligible area. 
‘‘(b) QUALIFIED REMEDIATION EXPENDITURES.—
For purposes of this section, the term ‘qualified remedi-
ation expenditures’ means expenditures, whether or not 
chargeable to capital account, in connection with—
‘‘(1) the abatement or control of any hazardous 
substance (as defined in section 198(d)), petroleum, 
or any petroleum by-product at the qualified con-
taminated site in accordance with an approved reme-
diation and redevelopment plan, 
‘‘(2) the complete demolition of any structure 
on such site if any portion of such structure is de-
molished in connection with such abatement or con-
trol,
‘‘(3) the removal and disposal of property in 
connection with the activities described in para-
graphs (1) and (2), and 
‘‘(4) the reconstruction of utilities in connection 
with such activities. 
For purposes of this section, the term ‘approved remedi-
ation and redevelopment plan’ means any plan for such 
abatement, control, and redevelopment of a qualified con-
taminated site which is approved by the State development 
agency for the State in which the qualified contaminated 
site is located. 
‘‘(c) CREDIT MAY NOT EXCEED ALLOCATION.—
‘‘(1) IN GENERAL.—The environmental remedi-
ation credit determined under this section with re-
spect to any qualified contaminated site shall not ex-
ceed the credit amount allocated under this section 
by the State development agency to the taxpayer for 
the remediation and redevelopment plan submitted 
by the taxpayer with respect to such site. 
‘‘(2) TIME FOR MAKING ALLOCATION.—An allo-
cation shall be taken into account under paragraph 
(1) for any taxable year only if made before the 
close of the calendar year in which such taxable year 
begins. 
‘‘(3) MANNER OF ALLOCATION.—
‘‘(A) ALLOCATION MUST BE PURSUANT TO 
PLAN.—No amount may be allocated under this 
subsection to any qualified contaminated site 
unless such amount is allocated pursuant to a 
qualified allocation plan of the State develop-
ment agency of the State in which such site is 
located. 
‘‘(B) QUALIFIED ALLOCATION PLAN.—For 
purposes of this paragraph, the term ‘qualified 
allocation plan’ means any plan—
‘‘(i) which sets forth selection criteria 
to be used to determine priorities of the 
State development agency in allocating 
credit amounts under this section, and 
‘‘(ii) which gives preference in allo-
cating credit amounts under this section to 
qualified contaminated sites based on—
‘‘(I) the extent of poverty, 
‘‘(II) whether the site is located 
in an enterprise zone or renewal com-
munity, 
‘‘(III) whether the site is located 
in the central business district of the 
local jurisdiction,
‘‘(IV) the extent of the required 
environmental remediation, 
‘‘(V) the extent of the commer-
cial, industrial, or residential redevel-
opment of the site in addition to envi-
ronmental remediation, 
‘‘(VI) the extent of the financial 
commitment to such redevelopment, 
and 
‘‘(VII) the amount of new em-
ployment expected to result from such 
redevelopment. 
‘‘(4) STATES
MAY
IMPOSE
OTHER
CONDI-
TIONS.—Nothing in this section shall be construed 
to prevent any State from requiring assurances, in-
cluding bonding, that any project for which a credit 
amount is allocated under this section will be prop-
erly completed or that the financial commitments of 
the taxpayer are actually carried out. 
‘‘(d) STATE ENVIRONMENTAL REMEDIATION CREDIT 
CEILING.—
‘‘(1) IN
GENERAL.—The State environmental 
remediation credit ceiling applicable to any State for 
any calendar year shall be an amount equal to the 
sum of—
‘‘(A) the unused State environmental re-
mediation credit ceiling (if any) of such State 
for the preceding calendar year, 
‘‘(B) such State’s share of the national en-
vironmental remediation credit limitation for 
the calendar year, 
‘‘(C) the amount of State environmental 
remediation credit ceiling returned in the cal-
endar year, plus 
‘‘(D) the amount (if any) allocated under 
paragraph (3) to such State by the Secretary. 
For purposes of subparagraph (A), the unused State 
environmental remediation credit ceiling for any cal-
endar year is the excess (if any) of the sum of the 
amounts described in subparagraphs (B), (C), and 
(D) over the aggregate environmental remediation 
credit amount allocated for such year. 
‘‘(2) NATIONAL ENVIRONMENTAL REMEDIATION 
CREDIT LIMITATION.—
‘‘(A) IN GENERAL.—The national environ-
mental remediation credit limitation for each 
calendar year is $1,000,000,000. 
‘‘(B) STATE’S SHARE OF LIMITATION.—A 
State’s share of such limitation is the amount 
which bears the same ratio to the limitation ap-
plicable under subparagraph (A) for the cal-
endar year as such State’s population bears to 
the population of the United States. 
‘‘(3) UNUSED ENVIRONMENTAL REMEDIATION 
CREDIT CARRYOVERS ALLOCATED AMONG CERTAIN 
STATES.—
‘‘(A) IN GENERAL.—The unused environ-
mental remediation credit carryover of a State 
for any calendar year shall be assigned to the 
Secretary for allocation among qualified States 
for the succeeding calendar year. 
‘‘(B) UNUSED ENVIRONMENTAL REMEDI-
ATION CREDIT CARRYOVER.—For purposes of 
this paragraph, the unused environmental reme-
diation credit carryover of a State for any cal-
endar year is the excess (if any) of—
‘‘(i) the unused State environmental 
remediation credit ceiling for the year pre-
ceding such year, over 
‘‘(ii) the aggregate environmental re-
mediation credit amount allocated for such 
year. 
‘‘(C) FORMULA FOR ALLOCATION OF UN-
USED
ENVIRONMENTAL
REMEDIATION
CREDIT 
CARRYOVERS
AMONG
QUALIFIED
STATES.—
Rules similar to the rules of clauses (iii) and 
(iv) of section 42(h)(3)(D) shall apply for pur-
poses of this paragraph. 
‘‘(4) POPULATION.—For purposes of this sub-
section, population shall be determined in accord-
ance with section 146(j). 
‘‘(5) INFLATION ADJUSTMENT.—In the case of 
any calendar year after 2004, the $1,000,000,000 
amount contained in paragraph (2) shall be in-
creased by an amount equal to—
‘‘(A) such dollar amount, multiplied by 
‘‘(B) the cost-of-living adjustment deter-
mined under section 1(f)(3) for the calendar 
year, determined by substituting ‘calendar year 
2003’ for ‘calendar year 1992’ in subparagraph 
(B) thereof. 
Any increase determined under the preceding sen-
tence shall be rounded to the nearest multiple of 
$500,000. 
‘‘(e) ELIGIBLE AREA; OTHER DEFINITIONS.—For 
purposes of this section—
‘‘(1) ELIGIBLE AREA.—
‘‘(A) IN
GENERAL.—The term ‘eligible 
area’ means the entire area encompassed by a 
local governmental unit if such area contains at
least 1 census tract having a poverty rate of at 
least 20 percent. 
‘‘(B) 
AREAS
NOT
WITHIN
CENSUS 
TRACTS.—In the case of an area which is not 
tracted for population census tracts, the equiva-
lent county divisions (as defined by the Bureau 
of the Census for purposes of defining poverty 
areas) shall be used for purposes of determining 
poverty rates. 
‘‘(C) USE OF CENSUS DATA.—Population 
and poverty rate shall be determined by the 
most recent decennial census data available. 
‘‘(2) QUALIFIED
CONTAMINATED
SITE.—The 
term ‘qualified contaminated site’ has the meaning 
given to such term by section 198, determined by 
treating petroleum and petroleum by-products as 
hazardous substances. 
‘‘(3) POSSESSIONS TREATED AS STATES.—The 
term ‘State’ includes a possession of the United 
States. 
‘‘(f) CREDIT MAY BE ASSIGNED.—
‘‘(1) IN GENERAL.—If a taxpayer elects the ap-
plication of this subsection for any taxable year, the 
amount of credit determined under this section for 
such year which would (but for this subsection) be
allowable to the taxpayer shall be allowable to the 
person designated by the taxpayer. The person so 
designated shall be treated as the taxpayer for pur-
poses of subsection (h). 
‘‘(2) TREATMENT OF AMOUNTS PAID FOR AS-
SIGNMENT.—If any amount is paid to the person 
who assigns the credit determined under this sec-
tion, no portion of such amount or such credit shall 
be includible in the payee’s gross income. 
‘‘(g) TREATMENT OF POTENTIAL RESPONSIBLE PAR-
TIES.—
‘‘(1) IN GENERAL.—No credit shall be allowed 
under this section to any potential responsible party 
(within the meaning of the Comprehensive Environ-
mental Response, Compensation, and Liability Act 
of 1980) with respect to any qualified contaminated 
site (including by reason of receiving an assignment 
of the credit under subsection (f)) unless at least 25 
percent of the cost of remediating such site is borne 
by such party. 
‘‘(2) RELIEF FROM LIABILITY FOR OTHER 75 
PERCENT.—If the requirement of paragraph (1) is 
met by a potential responsible party, such party 
shall not be liable under any Federal law for any
cost taken into account in determining whether such 
requirement is met. 
‘‘(3) AMOUNTS PAID FOR CREDIT ASSIGNMENT 
NOT ELIGIBLE.—Amounts paid by a potential re-
sponsible party to any person for the assignment by 
such person of the credit under subsection (f)) shall 
not be taken into account in determining whether 
the requirement of paragraph (1) is met. 
‘‘(h) RECAPTURE OF CREDIT IF ENVIRONMENTAL 
REMEDIATION NOT PROPERLY COMPLETED.—
‘‘(1) IN GENERAL.—If the State development 
agency of the State in which the qualified contami-
nated site is located determines that the environ-
mental remediation which is part of the approved re-
mediation and redevelopment plan for such site was 
not properly completed, then the taxpayer’s tax 
under this chapter for the taxable year in which 
such determination is made shall be increased by the 
credit recapture amount. 
‘‘(2) CREDIT RECAPTURE AMOUNT.—For pur-
poses of paragraph (1), the credit recapture amount 
is an amount equal to the sum of—
‘‘(A) the aggregate decrease in the credits 
allowed to the taxpayer under section 38 for all 
prior taxable years which would have resulted if
the credit allowable by reason of this section 
were not allowed, plus 
‘‘(B) interest at the overpayment rate es-
tablished under section 6621 on the amount de-
termined under subparagraph (A) for each 
prior taxable year for the period beginning on 
the due date for filing the return for the prior 
taxable year involved. 
No deduction shall be allowed under this chapter for 
interest described in subparagraph (B). 
‘‘(3) SPECIAL RULES.—
‘‘(A) TAX
BENEFIT
RULE.—The tax for 
the taxable year shall be increased under para-
graph (1) only with respect to credits allowed 
by reason of this section which were used to re-
duce tax liability. In the case of credits not so 
used to reduce tax liability, the carryforwards 
and carrybacks under section 39 shall be appro-
priately adjusted. 
‘‘(B) NO CREDITS AGAINST TAX.—Any in-
crease in tax under this subsection shall not be 
treated as a tax imposed by this chapter for 
purposes of determining the amount of any 
credit or the tax imposed by section 55. 
‘‘(i) DENIAL OF DOUBLE BENEFIT.—
‘‘(1) IN GENERAL.—No deduction shall be al-
lowed for that portion of the qualified remediation 
expenditures otherwise allowable as a deduction for 
the taxable year which is equal to the amount of the 
credit determined for such taxable year under this 
section. 
‘‘(2) SIMILAR
RULE
WHERE
TAXPAYER
CAP-
ITALIZES RATHER THAN DEDUCTS EXPENSES.—If—
‘‘(A) the amount of the credit determined 
for the taxable year under this section, exceeds 
‘‘(B) the amount allowable as a deduction 
for such taxable year for qualified remediation 
expenditures (determined without regard to 
paragraph (1)), 
the amount chargeable to capital account for the 
taxable year for such expenditures shall be reduced 
by the amount of such excess. 
‘‘(3) CONTROLLED GROUPS.—In the case of a 
corporation which is a member of a controlled group 
of corporations (within the meaning of section 
52(a)) or a trade or business which is treated as 
being under common control with other trades or 
businesses (within the meaning of section 52(b)), 
this subsection shall be applied under rules pre-
scribed by the Secretary similar to the rules applica-
ble under subsections (a) and (b) of section 52.’’
(b) CREDIT TREATED AS BUSINESS CREDIT.—Sec-
tion 38(b) of such Code is amended by striking ‘‘plus’’ 
at the end of paragraph (14), by striking the period at 
the end of paragraph (15) and inserting ‘‘, plus’’, and by 
adding at the end the following new paragraph: 
‘‘(16) the environmental remediation credit de-
termined under section 45G(a).’’. 
(c) NO CARRYBACKS 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 following: 
‘‘(11) NO CARRYBACK OF SECTION 45G CREDIT 
BEFORE EFFECTIVE DATE.—No portion of the un-
used business credit for any taxable year which is 
attributable to the environmental remediation credit 
determined under section 45G may be carried back 
to a taxable year ending before the date of the en-
actment of section 45G.’’. 
(d) CONFORMING AMENDMENT.—The table of sec-
tions for subpart D of part IV of subchapter A of chapter 
1 of such Code is amended by adding at the end the fol-
lowing new item:
‘‘Sec. 45G. Environmental remediation credit.’’.
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act.
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