240 
ate an expenditure plan for funds provided under this 
heading. 
MILITARY CONSTRUCTION, DEFENSE-WIDE 
For an additional amount for ‘‘Military Construction, 
Defense-Wide’’, $3,750,000,000, for the construction of 
hospitals and ambulatory surgery centers: Provided, That 
notwithstanding any other provision of law, such funds 
may be obligated and expended to carry out planning and 
design and military construction projects in the United 
States not otherwise authorized by law: Provided further, 
That not later than 30 days after the date of enactment 
of this Act, the Secretary of Defense shall submit to the 
Committees on Appropriations of the House of Represent-
atives and the Senate an expenditure plan for funds pro-
vided under this heading. 
MILITARY CONSTRUCTION, ARMY NATIONAL GUARD 
For an additional amount for ‘‘Military Construction, 
Army National Guard’’, $140,000,000: Provided, That 
notwithstanding any other provision of law, such funds 
may be obligated and expended to carry out planning and 
design and military construction projects in the United 
States not otherwise authorized by law: Provided further, 
That not later than 30 days after the date of enactment 
of this Act, the Secretary of Defense shall submit to the 
Committees on Appropriations of the House of Represent-
241 
atives and the Senate an expenditure plan for funds pro-
vided under this heading. 
MILITARY CONSTRUCTION, AIR NATIONAL GUARD 
For an additional amount for ‘‘Military Construction, 
Air National Guard’’, $70,000,000: Provided, That not-
withstanding any other provision of law, such funds may 
be obligated and expended to carry out planning and de-
sign and military construction projects in the United 
States not otherwise authorized by law: Provided further, 
That not later than 30 days after the date of enactment 
of this Act, the Secretary of Defense shall submit to the 
Committees on Appropriations of the House of Represent-
atives and the Senate an expenditure plan for funds pro-
vided under this heading. 
MILITARY CONSTRUCTION, ARMY RESERVE 
For an additional amount for ‘‘Military Construction, 
Army Reserve’’, $100,000,000: Provided, That notwith-
standing any other provision of law, such funds may be 
obligated and expended to carry out planning and design 
and military construction projects in the United States not 
otherwise authorized by law: Provided further, That not 
later than 30 days after the date of enactment of this Act, 
the Secretary of Defense shall submit to the Committees 
on Appropriations of the House of Representatives and the
242 
Senate an expenditure plan for funds provided under this 
heading. 
MILITARY CONSTRUCTION, NAVY RESERVE 
For an additional amount for ‘‘Military Construction, 
Navy Reserve’’, $30,000,000: Provided, That notwith-
standing any other provision of law, such funds may be 
obligated and expended to carry out planning and design 
and military construction projects in the United States not 
otherwise authorized by law: Provided further, That not 
later than 30 days after the date of enactment of this Act, 
the Secretary of Defense shall submit to the Committees 
on Appropriations of the House of Representatives and the 
Senate an expenditure plan for funds provided under this 
heading. 
MILITARY CONSTRUCTION, AIR FORCE RESERVE 
For an additional amount for ‘‘Military Construction, 
Air Force Reserve’’, $60,000,000: Provided, That notwith-
standing any other provision of law, such funds may be 
obligated and expended to carry out planning and design 
and military construction projects in the United States not 
otherwise authorized by law: Provided further, That not 
later than 30 days after the date of enactment of this Act, 
the Secretary of Defense shall submit to the Committees 
on Appropriations of the House of Representatives and the
243 
Senate an expenditure plan for funds provided under this 
heading. 
DEPARTMENT OF DEFENSE BASE CLOSURE ACCOUNT 
1990 
For an additional amount to be deposited into the 
Department of Defense Base Closure Account 1990, es-
tablished by section 2906(a)(1) of the Defense Base Clo-
sure and Realignment Act of 1990 (10 U.S.C. 2687 note), 
$300,000,000: Provided, That not later than 30 days after 
the date of enactment of this Act, the Secretary of Defense 
shall submit to the Committees on Appropriations of the 
House of Representatives and the Senate an expenditure 
plan for funds provided under this heading. 
DEPARTMENT OF VETERANS AFFAIRS 
VETERANS HEALTH ADMINISTRATION 
MEDICAL FACILITIES 
For an additional amount for ‘‘Medical Facilities’’ for 
non-recurring maintenance, including energy projects, 
$950,000,000: Provided, That not later than 30 days after 
the date of enactment of this Act, the Secretary of Vet-
erans Affairs shall submit to the Committees on Appro-
priations of the House of Representatives and the Senate 
an expenditure plan for funds provided under this head-
ing.
244 
NATIONAL CEMETERY ADMINISTRATION 
For an additional amount for ‘‘National Cemetery 
Administration’’ for monument and memorial repairs, 
$50,000,000: Provided, That not later than 30 days after 
the date of enactment of this Act, the Secretary of Vet-
erans Affairs shall submit to the Committees on Appro-
priations of the House of Representatives and the Senate 
an expenditure plan for funds provided under this head-
ing. 
TITLE XI—DEPARTMENT OF 
STATE 
DEPARTMENT OF STATE 
ADMINISTRATION OF FOREIGN AFFAIRS 
CAPITAL INVESTMENT FUND 
For an additional amount for ‘‘Capital Investment 
Fund’’, $276,000,000, of which up to $120,000,000 shall 
be available for the design and construction of a backup 
information management facility in the United States to 
support mission-critical operations and projects, and up 
to $98,527,000 shall be available to carry out the Depart-
ment of State’s responsibilities under the Comprehensive 
National Cybersecurity Initiative: Provided, That the Sec-
retary of State shall submit to the Committees on Appro-
priations of the House of Representatives and the Senate
245 
within 90 days of enactment of this Act a detailed spend-
ing plan for funds appropriated under this heading. 
INTERNATIONAL COMMISSIONS 
INTERNATIONAL BOUNDARY AND WATER COMMISSION, 
UNITED STATES AND MEXICO 
CONSTRUCTION 
(INCLUDING TRANSFER OF FUNDS) 
For an additional amount for ‘‘Construction’’ for the 
water quantity program to meet immediate repair and re-
habilitation requirements, $224,000,000: Provided, That 
up to $2,000,000 may be transferred to, and merged with, 
funds available under the heading ‘‘International Bound-
ary and Water Commission, United States and Mexico— 
Salaries and Expenses’’, and such amount shall be in lieu 
of amounts available under section 1106 of this Act: Pro-
vided, That the Secretary of State shall submit to the 
Committees on Appropriations of the House of Represent-
atives and the Senate within 90 days of enactment of this 
Act a detailed spending plan for funds appropriated under 
this heading.
246 
TITLE 
XII—TRANSPORTATION, 
AND HOUSING AND URBAN 
DEVELOPMENT 
DEPARTMENT OF TRANSPORTATION 
FEDERAL AVIATION ADMINISTRATION 
GRANTS-IN-AID FOR AIRPORTS 
For an additional amount for ‘‘Grants-in-Aid for Air-
ports’’, to enable the Secretary of Transportation to make 
grants for discretionary projects as authorized by sub-
chapter I of chapter 471 and subchapter I of chapter 475 
of title 49, United States Code, $3,000,000,000: Provided, 
That such funds shall not be subject to apportionment for-
mulas, special apportionment categories, or minimum per-
centages under chapter 471: Provided further, That the 
conditions, certifications, and assurances required for 
grants under subchapter I of chapter 471 of such title 
apply: Provided further, That for purposes of applying sec-
tion 1104 of this Act to this appropriation, the deadline 
for grantees to enter into contracts or other binding com-
mitments to make use of not less than 50 percent of the 
funds awarded shall be 90 days after award of the grant. 
FEDERAL HIGHWAY ADMINISTRATION 
HIGHWAY INFRASTRUCTURE INVESTMENT 
For projects and activities eligible under section 133 
of title 23, United States Code, section 144 of such title
247 
(without regard to subsection (g)), and sections 103, 119, 
134, 148, and 149 of such title, $30,000,000,000, of 
which $300,000,000 shall be for Indian reservation roads 
under section 204 of such title; $250,000,000 shall be for 
park roads and parkways under section 204 of such title; 
$20,000,000 shall be for highway surface transportation 
and technology training under section 140(b) of such title; 
and $20,000,000 shall be for disadvantaged business en-
terprises bonding assistance under section 332(e) of title 
49, United States Code: Provided, That the amount set 
aside from this appropriation pursuant to section 1106 of 
this Act shall not be more than 0.2 percent of the funds 
made available under this heading instead of the percent-
age specified in such section: Provided further, That, after 
making the set-asides authorized by the previous provisos, 
the funds made available under this heading shall be dis-
tributed among the States, and Puerto Rico, American 
Samoa, Guam, the Virgin Islands, and the Commonwealth 
of the Northern Mariana Islands, in the same ratio as the 
obligation limitation for fiscal year 2008 was distributed 
among the States in accordance with the formula specified 
in section 120(a)(6) of division K of Public Law 110–161, 
but, in the case of the Puerto Rico Highway Program and 
the Territorial Highway Program, under section 120(a)(5) 
of such division: Provided further, That 45 percent of the
248 
funds distributed to a State under this heading shall be 
suballocated within the State in the manner and for the 
purposes described in section 133(d) of title 23, United 
States Code, (without regard to the comparison to fiscal 
year 2005 in paragraph (2)): Provided further, That in 
selecting projects to be funded, recipients shall give pri-
ority to projects that can award contracts within 90 days 
of enactment of this Act, are included in an approved 
Statewide Transportation Improvement Program (STIP) 
and/or Metropolitan Transportation Improvement Pro-
gram (TIP), are projected for completion within a three- 
year time frame, and are located in economically dis-
tressed areas as defined by section 301 of the Public 
Works and Economic Development Act of 1965, as 
amended (42 U.S.C. 3161): Provided further, That funds 
made available under this heading shall be administered 
as if apportioned under chapter 1 of title 23, United 
States Code, except for funds made available for Indian 
reservation roads and park roads and parkways which 
shall be administered in accordance with chapter 2 of title 
23, United States Code: Provided further, That the Fed-
eral share payable on account of any project or activity 
carried out with funds made available under this heading 
shall, at the option of the recipient, be up to 100 percent 
of the total cost thereof: Provided further, That funds
249 
made available by this Act shall not be obligated for the 
purposes authorized under section 115(b) of title 23, 
United States Code: Provided further, That the provisions 
of section 1101(b) of Public Law 109–59 shall apply to 
funds made available under this heading: Provided further, 
That, in lieu of the redistribution required by section 
1104(b) of this Act, if less than 50 percent of the funds 
made available to each State and territory under this 
heading are obligated within 90 days after the date of dis-
tribution of those funds to the States and territories, then 
the portion of the 50 percent of the total funding distrib-
uted to the State or territory that has not been obligated 
shall be redistributed, in the manner described in section 
120(c) of division K of Public Law 110–161, to those 
States and territories that have obligated at least 50 per-
cent of the funds made available under this heading and 
are able to obligate amounts in addition to those pre-
viously distributed, except that, for those funds suballo-
cated within the State, if less than 50 percent of the funds 
so suballocated within the State are obligated within 75 
days of suballocation, then the portion of the 50 percent 
of funding so suballocated that has not been obligated will 
be returned to the State for use anywhere in the State 
prior to being redistributed in accordance with the first 
part of this proviso: Provided further, That, in lieu of the
250 
redistribution required by section 1104(b) of this Act, any 
funds made available under this heading that are not obli-
gated by August 1, 2010, shall be redistributed, in the 
manner described in section 120(c) of division K of Public 
Law 110–161, to those States able to obligate amounts 
in addition to those previously distributed, except that 
funds suballocated within the State that are not obligated 
by June 1, 2010, will be returned to the State for use 
anywhere in the State prior to being redistributed in ac-
cordance with the first part of this proviso: Provided fur-
ther, That notwithstanding section 1103 of this Act, funds 
made available under this heading shall be apportioned not 
later than 7 days after the date of enactment of this Act. 
FEDERAL RAILROAD ADMINISTRATION 
CAPITAL ASSISTANCE FOR INTERCITY PASSENGER RAIL 
SERVICE 
For an additional amount for ‘‘Capital Assistance for 
Intercity Passenger Rail Service’’ to enable the Secretary 
of Transportation to make grants for capital costs as au-
thorized by chapter 244 of title 49 United States Code, 
$300,000,000: Provided, That notwithstanding section 
1103 of this Act, the Secretary shall give preference to 
projects for the repair, rehabilitation, upgrade, or pur-
chase of railroad assets or infrastructure that can be 
awarded within 90 days of enactment of this Act: Provided
251 
further, That in awarding grants for the acquisition of a 
piece of rolling stock or locomotive, the Secretary shall 
give preference to FRA-compliant rolling stock and loco-
motives: Provided further, That the Secretary shall give 
preference to projects that support the development of 
intercity high speed rail service: Provided further, That the 
Federal share shall be, at the option of the recipient, up 
to 100 percent. 
CAPITAL AND DEBT SERVICE GRANTS TO THE NATIONAL 
RAILROAD PASSENGER CORPORATION 
For an additional amount for ‘‘Capital and Debt 
Service Grants to the National Railroad Passenger Cor-
poration’’ (Amtrak) to enable the Secretary of Transpor-
tation to make capital grants to Amtrak as authorized by 
section 101(c) of the Passenger Rail Investment and Im-
provement 
Act 
of 
2008 
(Public 
Law 
110–432), 
$800,000,000: Provided, That priority shall be given to 
projects for the repair, rehabilitation, or upgrade of rail-
road assets or infrastructure: Provided further, That none 
of the funds under this heading shall be used to subsidize 
the operating losses of Amtrak: Provided further, Notwith-
standing section 1103 of this Act, funds made available 
under this heading shall be awarded not later than 7 days 
after the date of enactment of this Act.
252 
FEDERAL TRANSIT ADMINISTRATION 
TRANSIT CAPITAL ASSISTANCE 
For transit capital assistance grants, $6,000,000,000 
(increased by $1,500,000,000), of which $5,400,000,000 
(increased by $1,350,000,000) shall be for grants under 
section 5307 of title 49, United States Code and shall be 
apportioned in accordance with section 5336 of such title 
(other than subsections (i)(1) and (j)) but may not be 
combined or commingled with any other funds apportioned 
under such section 5336, and of which $600,000,000 (in-
creased by $150,000,000) shall be for grants under sec-
tion 5311 of such title and shall be apportioned in accord-
ance with such section 5311 but may not be combined or 
commingled with any other funds apportioned under that 
section: Provided, That of the funds provided for section 
5311 under this heading, 3 percent shall be made available 
for section 5311(c)(1): Provided further, That applicable 
chapter 53 requirements shall apply except that the Fed-
eral share of the costs for which a grant is made under 
this heading shall be, at the option of the recipient, up 
to 100 percent: Provided further, In lieu of the require-
ments of section 1103 of this Act, funds made available 
under this heading shall be apportioned not later than 7 
days after the date of enactment of this Act: Provided fur-
ther, That for purposes of applying section 1104 of this
253 
Act to this appropriation, the deadline for grantees to 
enter into obligations to make use of not less than 50 per-
cent of the funds awarded shall be 90 days after appor-
tionment: Provided further, That the provisions of section 
1101(b) of Public Law 109–59 shall apply to funds made 
available under this heading: Provided further, That not-
withstanding any other provision of law, of the funds ap-
portioned in accordance with section 5336, up to three- 
quarters of 1 percent shall be available for administrative 
expenses and program management oversight and of the 
funds apportioned in accordance with section 5311, up to 
one-half of 1 percent shall be available for administrative 
expenses and program management oversight and both 
amounts shall remain available for obligation until Sep-
tember 30, 2012: Provided further, That the preceding 
proviso shall apply in lieu of the provisions in section 1106 
of this Act. 
FIXED GUIDEWAY INFRASTRUCTURE INVESTMENT 
For an amount for capital expenditures authorized 
under section 5309(b)(2) of title 49, United States Code, 
$2,000,000,000: Provided, That the Secretary of Trans-
portation shall apportion funds under this heading pursu-
ant to the formula set forth in section 5337 of title 49, 
United States Code: Provided further, That the funds ap-
propriated under this heading shall not be commingled
254 
with funds available under the Formula and Bus Grants 
account: Provided further, In lieu of the requirements of 
section 1103 of this Act, funds made available under this 
heading shall be apportioned not later than 7 days after 
the date of enactment of this Act: Provided further, That 
for purposes of applying section 1104 of this Act to this 
appropriation, the deadline for grantees to enter into obli-
gations to make use of not less than 50 percent of the 
funds awarded shall be 90 days after apportionment: Pro-
vided further, That applicable chapter 53 requirements 
shall apply except that the Federal share of the costs for 
which a grant is made under this heading shall be, at the 
option of the recipient, up to 100 percent: Provided fur-
ther, That the provisions of section 1101(b) of Public Law 
109–59 shall apply to funds made available under this 
heading: Provided further, That notwithstanding any other 
provision of law, up to 1 percent of the funds under this 
heading shall be available for administrative expenses and 
program management oversight and shall remain available 
for obligation until September 30, 2012: Provided further, 
That the preceding proviso shall apply in lieu of the provi-
sions in section 1106 of this Act. 
CAPITAL INVESTMENT GRANTS 
For an additional amount for ‘‘Capital Investment 
Grants’’, as authorized under section 5338(c)(4) of title
255 
49, United States Code, and allocated under section 
5309(m)(2)(A) of such title, to enable the Secretary of 
Transportation to make discretionary grants as authorized 
by section 5309(d) and (e) of such title, $1,000,000,000 
(increased by $1,500,000,000): Provided, That such 
amount shall be allocated without regard to the limitation 
under section 5309(m)(2)(A)(i): Provided further, That in 
selecting projects to be funded, priority shall be given to 
projects that are currently in construction or are able to 
award contracts based on bids within 90 days of enact-
ment of this Act: Provided further, That for purposes of 
applying section 1104 of this Act to this appropriation, 
the deadline for grantees to enter into contracts or other 
binding commitments to make use of not less than 50 per-
cent of the funds awarded shall be 90 days after award: 
Provided further, That the provisions of section 1101(b) 
of Public Law 109–59 shall apply to funds made available 
under this heading: Provided further, That applicable 
chapter 53 requirements shall apply, except that notwith-
standing any other provision of law, up to 1 percent of 
the funds under this heading shall be available for admin-
istrative expenses and program management oversight and 
shall remain available for obligation until September 30, 
2012: Provided further, That the preceding proviso shall 
apply in lieu of the provisions in section 1106 of this Act.
256 
DEPARTMENT OF HOUSING AND URBAN 
DEVELOPMENT 
PUBLIC AND INDIAN HOUSING 
PUBLIC HOUSING CAPITAL FUND 
For an additional amount for ‘‘Public Housing Cap-
ital Fund’’ to carry out capital and management activities 
for public housing agencies, as authorized under section 
9 of the United States Housing Act of 1937 (42 U.S.C. 
1437g) (‘‘the Act’’), $5,000,000,000: Provided, That the 
Secretary of Housing and Urban Development shall dis-
tribute at least $4,000,000,000 of this amount by the 
same formula used for amounts made available in fiscal 
year 2008: Provided further, That public housing authori-
ties shall give priority to capital projects that can award 
contracts based on bids within 120 days from the date 
the funds are made available to the public housing au-
thorities: Provided further, That public housing agencies 
shall give priority consideration to the rehabilitation of va-
cant rental units: Provided further, That notwithstanding 
any other provision of the Act or regulations: (1) funding 
provided herein may not be used for Operating Fund ac-
tivities pursuant to section 9(g) of the Act; and (2) any 
restriction of funding to replacement housing uses shall 
be inapplicable: Provided further, That public housing 
agencies shall prioritize capital projects underway or al-
257 
ready in their 5-year plans: Provided further, That of the 
amount provided under this heading, the Secretary may 
obligate up to $1,000,000,000, for competitive grants to 
public housing authorities for activities including: (1) in-
vestments that leverage private sector funding or financ-
ing for housing renovations and energy conservation ret-
rofit investments; (2) rehabilitation of units using sustain-
able materials and methods that improve energy efficiency, 
reduce energy costs, or preserve and improve units with 
good access to public transportation or employment cen-
ters; (3) increase the availability of affordable rental hous-
ing by expediting rehabilitation projects to bring vacant 
units into use or by filling the capital investment gap for 
redevelopment or replacement housing projects which have 
been approved or are otherwise ready to proceed but are 
stalled due to the inability to obtain anticipated private 
capital; or (4) address the needs of seniors and persons 
with disabilities through improvements to housing and re-
lated facilities which attract or promote the coordinated 
delivery of supportive services: Provided further, That the 
Secretary may waive statutory or regulatory provisions re-
lated to the obligation and expenditure of capital funds 
if necessary to facilitate the timely expenditure of funds 
(except for requirements related to fair housing, non-
discrimination, labor standards, and the environment).
258 
ELDERLY, DISABLED, AND SECTION 8 ASSISTED HOUSING 
ENERGY RETROFIT 
For grants or loans to owners of properties receiving 
project-based assistance pursuant to section 202 of the 
Housing Act of 1959 (12 U.S.C. 17012), section 811 of 
the Cranston-Gonzalez National Affordable Housing Act 
(42 U.S.C. 8013), or section 8 of the United States Hous-
ing Act of 1937 (42 U.S.C. 1437f), to accomplish energy 
retrofit investments, $2,500,000,000: Provided, That such 
loans or grants shall be provided through the Office of 
Affordable Housing Preservation of the Department of 
Housing and Urban Development, on such terms and con-
ditions as the Secretary of Housing and Urban Develop-
ment deems appropriate: Provided further, That eligible 
owners must have at least a satisfactory management re-
view rating, be in substantial compliance with applicable 
performance standards and legal requirements, and com-
mit to an additional period of affordability determined by 
the Secretary: Provided further, That the Secretary shall 
undertake appropriate underwriting and oversight with re-
spect to such transactions: Provided further, That the Sec-
retary may set aside funds made available under this 
heading for an efficiency incentive payable upon satisfac-
tory completion of energy retrofit investments, and may 
provide additional incentives if such investments resulted
259 
in extraordinary job creation for low-income and very low- 
income persons: Provided further, that of the funds pro-
vided under this heading, 1 percent shall be available only 
for staffing, training, technical assistance, technology, 
monitoring, research and evaluation activities. 
NATIVE AMERICAN HOUSING BLOCK GRANTS 
For an additional amount for ‘‘Native American 
Housing Block Grants’’, as authorized under title I of the 
Native American Housing Assistance and Self-Determina-
tion Act of 1996 (‘‘NAHASDA’’) (25 U.S.C. 4111 et 
seq.), $500,000,000: Provided, That $250,000,000 of the 
amount appropriated under this heading shall be distrib-
uted according to the same funding formula used in fiscal 
year 2008: Provided further, That in selecting projects to 
be funded, recipients shall give priority to projects that 
can award contracts based on bids within 120 days from 
the date that funds are available to the recipients: Pro-
vided further, That in allocating the funds appropriated 
under this heading, the Secretary of Housing and Urban 
Development shall not require an additional action plan 
from grantees: Provided further, That the Secretary may 
obligate $250,000,000 of the amount appropriated under 
this heading for competitive grants to eligible entities that 
apply for funds as authorized under NAHASDA: Provided 
further, That in awarding competitive funds, the Secretary
260 
shall give priority to projects that will spur construction 
and rehabilitation and will create employment opportuni-
ties for low-income and unemployed persons. 
COMMUNITY PLANNING AND DEVELOPMENT 
COMMUNITY DEVELOPMENT FUND 
For an additional amount for ‘‘Community Develop-
ment Fund’’ $1,000,000,000, to carry out the community 
development block grant program under title I of the 
Housing and Community Development Act of 1974 (42 
U.S.C. 5301 et seq.): Provided, That the amount appro-
priated in this paragraph shall be distributed according 
to the same funding formula used in fiscal year 2008: Pro-
vided further, That in allocating the funds appropriated 
in this paragraph, the Secretary of Housing and Urban 
Development shall not require an additional action plan 
from grantees: Provided further, That in selecting projects 
to be funded, recipients shall give priority to projects that 
can award contracts based on bids within 120 days from 
the date the funds are made available to the recipients; 
Provided further, That in administering funds provided in 
this paragraph, the Secretary may waive any provision of 
any statute or regulation that the Secretary administers 
in connection with the obligation by the Secretary or the 
use by the recipient of these funds (except for require-
ments related to fair housing, nondiscrimination, labor
261 
standards, and the environment), upon a finding that such 
waiver is required to facilitate the timely use of such funds 
and would not be inconsistent with the overall purpose of 
the statute. 
For a further additional amount for ‘‘Community De-
velopment Fund’’, $4,190,000,000, to be used for neigh-
borhood stabilization activities related to emergency as-
sistance for the redevelopment of abandoned and fore-
closed homes as authorized under division B, title III of 
the Housing and Economic Recovery Act of 2008 (Public 
Law 110–289), of which— 
(1) not less than $3,440,000,000 shall be allo-
cated by a competition for which eligible entities 
shall be States, units of general local government, 
and nonprofit entities or consortia of nonprofit enti-
ties: Provided, That the award criteria for such com-
petition shall include grantee capacity, leveraging 
potential, targeted impact of foreclosure prevention, 
and any additional factors determined by the Sec-
retary of Housing and Urban Development: Provided 
further, that the Secretary may establish a minimum 
grant size: Provided further, That amounts made 
available under this Section may be used to: (A) es-
tablish financing mechanisms for purchase and rede-
velopment of foreclosed-upon homes and residential
262 
properties, including such mechanisms as soft-sec-
onds, loan loss reserves, and shared-equity loans for 
low- and moderate-income homebuyers; (B) purchase 
and rehabilitate homes and residential properties 
that have been abandoned or foreclosed upon, in 
order to sell or rent such homes and properties; (C) 
establish and operate land banks for homes that 
have been foreclosed upon; (D) demolish foreclosed 
properties that have become blighted structures; and 
(E) redevelop demolished or vacant foreclosed prop-
erties in order to sell or rent such properties; and 
(2) up to $750,000,000 shall be awarded by 
competition to nonprofit entities or consortia of non-
profit entities to provide community stabilization as-
sistance by: (A) accelerating state and local govern-
ment and nonprofit productivity; (B) increasing the 
scale and efficiency of property transfers of fore-
closed and vacant residential properties from finan-
cial institutions and government entities to qualified 
local housing providers in order to return the prop-
erties to productive affordable housing use; (C) 
building industry and property management capac-
ity; and (D) partnering with private sector real es-
tate developers and contractors and leveraging pri-
vate sector capital: Provided further, That such com-
263 
munity stabilization assistance shall be provided pri-
marily in States and areas with high rates of de-
faults and foreclosures to support the acquisition, re-
habilitation and property management of single-fam-
ily and multi-family homes and to work in partner-
ship with the private sector real estate industry and 
to leverage available private and public funds for 
those purposes: Provided further, That for purposes 
of this paragraph qualified local housing providers 
shall be nonprofit organizations with demonstrated 
capabilities in real estate development or acquisition 
and rehabilitation or property management of single- 
or multi-family homes, or local or state governments 
or instrumentalities of such governments: Provided 
further, That qualified local housing providers shall 
be expected to utilize and leverage additional local 
nonprofit, governmental, for-profit and private re-
sources: 
Provided further, That in the case of any foreclosure on 
any dwelling or residential real property acquired with any 
amounts made available under this heading, any successor 
in interest in such property pursuant to the foreclosure 
shall assume such interest subject to: (1) the provision by 
such successor in interest of a notice to vacate to any bona 
fide tenant at least 90 days before the effective date of
264 
such notice; and (2) the rights of any bona fide tenant, 
as of the date of such notice of foreclosure: (A) under any 
bona fide lease entered into before the notice of foreclosure 
to occupy the premises until the end of the remaining term 
of the lease, except that a successor in interest may termi-
nate a lease effective on the date of sale of the unit to 
a purchaser who will occupy the unit as a primary resi-
dence, subject to the receipt by the tenant of the 90-day 
notice under this paragraph; or (B) without a lease or with 
a lease terminable at will under State law, subject to the 
receipt by the tenant of the 90-day notice under this para-
graph, except that nothing in this paragraph shall affect 
the requirements for termination of any Federal- or State- 
subsidized tenancy or of any State or local law that pro-
vides longer time periods or other additional protections 
for tenants: Provided further, That, for purposes of this 
paragraph, a lease or tenancy shall be considered bona fide 
only if: (1) the mortgagor under the contract is not the 
tenant; (2) the lease or tenancy was the result of an arms- 
length transaction; and (3) the lease or tenancy requires 
the receipt of rent that is not substantially less than fair 
market rent for the property: Provided further, That the 
recipient of any grant or loan from amounts made avail-
able under this heading may not refuse to lease a dwelling 
unit in housing assisted with such loan or grant to a hold-
265 
er of a voucher or certificate of eligibility under section 
8 of the United States Housing Act of 1937 (42 U.S.C. 
1437f) because of the status of the prospective tenant as 
such a holder: Provided further, That in the case of any 
qualified foreclosed housing for which funds made avail-
able under this heading are used and in which a recipient 
of assistance under section 8(o) of the U.S. Housing Act 
of 1937 resides at the time of acquisition or financing, 
the owner and any successor in interest shall be subject 
to the lease and to the housing assistance payments con-
tract for the occupied unit: Provided further, That 
vacating the property prior to sale shall not constitute 
good cause for termination of the tenancy unless the prop-
erty is unmarketable while occupied or unless the owner 
or subsequent purchaser desires the unit for personal or 
family use: Provided further, That this paragraph shall not 
preempt any State or local law that provides more protec-
tion for tenants: Provided further, That amounts made 
available under this heading may be used for the costs 
of demolishing foreclosed housing that is deteriorated or 
unsafe: Provided further, That the amount for demolition 
of such housing may not exceed 10 percent of amounts 
allocated under this paragraph to States and units of gen-
eral local government: Provided further, That no amounts 
from a grant made under this paragraph may be used to
266 
demolish any public housing (as such term is defined in 
section 3 of the United States Housing Act of 1937 (42 
U.S.C. 1437a)): Provided further, That section 2301(d)(4) 
of the Housing and Economic Recovery Act of 2008 (Pub-
lic Law 110–289) is repealed. 
HOME INVESTMENT PARTNERSHIPS PROGRAM 
For an additional amount for ‘‘HOME Investment 
Partnerships Program’’ as authorized under Title II of the 
Cranston-Gonzalez National Affordable Housing Act (‘‘the 
Act’’), $1,500,000,000: Provided, That the amount appro-
priated under this heading shall be distributed according 
to the same funding formula used in fiscal year 2008: Pro-
vided further, That the Secretary of Housing and Urban 
Development may waive statutory or regulatory provisions 
related to the obligation of such funds if necessary to fa-
cilitate the timely expenditure of funds (except for require-
ments related to fair housing, nondiscrimination, labor 
standards, and the environment): Provided further, That 
in selecting projects to be funded, recipients shall give pri-
ority to projects that can award contracts based on bids 
within 120 days from the date that funds are available 
to the recipients.
267 
SELF-HELP AND ASSISTED HOMEOWNERSHIP 
OPPORTUNITY PROGRAM 
For an additional amount for ‘‘Self-Help and As-
sisted Homeownership Opportunity Program’’, as author-
ized under section 11 of the Housing Opportunity Pro-
gram Extension Act of 1996, $10,000,000: Provided, That 
in awarding competitive grant funds, the Secretary of 
Housing and Urban Development shall give priority to the 
provision and rehabilitation of sustainable, affordable sin-
gle and multifamily units in low-income, high-need rural 
areas: Provided further, That in selecting projects to be 
funded, grantees shall give priority to projects that can 
award contracts based on bids within 120 days from the 
date the funds are made available to the grantee. 
HOMELESS ASSISTANCE GRANTS 
For an additional amount for ‘‘Homeless Assistance 
Grants’’, for the emergency shelter grants program as au-
thorized under subtitle B of tile IV of the McKinney-Vento 
Homeless Assistance Act, $1,500,000,000: Provided, That 
in addition to homeless prevention activities specified in 
the emergency shelter grant program, funds provided 
under this heading may be used for the provision of short- 
term or medium-term rental assistance; housing relocation 
and stabilization services including housing search, medi-
ation or outreach to property owners, legal services, credit
268 
repair, resolution of security or utility deposits, utility pay-
ments, rental assistance for a final month at a location, 
and moving costs assistance; or other appropriate home-
lessness prevention activities; Provided further, That these 
funds shall be allocated pursuant to the formula author-
ized by section 413 of such Act: Provided further, That 
the Secretary of Housing and Urban Development may 
waive statutory or regulatory provisions related to the obli-
gation and use of emergency shelter grant funds necessary 
to facilitate the timely expenditure of funds. 
OFFICE OF HEALTHY HOMES AND LEAD HAZARD 
CONTROL 
LEAD HAZARD REDUCTION 
For an additional amount for ‘‘Lead Hazard Reduc-
tion’’, for the Lead Hazard Reduction Program as author-
ized by section 1011 of the Residential Lead-Based Paint 
Hazard Reduction Act of 1992, $100,000,000: Provided, 
That for purposes of environmental review, pursuant to 
the National Environmental Policy Act of 1969 (42 U.S.C. 
4321 et seq.) and other provisions of law that further the 
purposes of such Act, a grant under the Healthy Homes 
Initiative, Operation Lead Elimination Action Plan 
(LEAP), or the Lead Technical Studies program under 
this heading or under prior appropriations Acts for such 
purposes under this heading, shall be considered to be
269 
funds for a special project for purposes of section 305(e) 
of the Multifamily Housing Property Disposition Reform 
Act of 1994: Provided further, That of the total amount 
made available under this heading, $30,000,000 shall be 
made available on a competitive basis for areas with the 
highest lead paint abatement needs. 
GENERAL PROVISIONS, THIS TITLE 
SEC. 12001. MAINTENANCE OF EFFORT AND REPORTING 
REQUIREMENTS TO ENSURE TRANSPARENCY 
AND ACCOUNTABILITY. 
(a) MAINTENANCE OF EFFORT.—Not later than 30 
days after the date of enactment of this Act, for each 
amount that is distributed to a State or agency thereof 
from an appropriation in this Act for a covered program, 
the Governor of the State shall certify that the State will 
maintain its effort with regard to State funding for the 
types of projects that are funded by the appropriation. As 
part of this certification, the Governor shall submit to the 
covered agency a statement identifying the amount of 
funds the State planned to expend as of October 1, 2008, 
from non-Federal sources in the period beginning on the 
date of enactment of this Act through September 30, 
2010, for the types of projects that are funded by the ap-
propriation.
270 
(b) FAILURE TO MAINTAIN EFFORT.—If a Governor 
is unable to certify that Federal funds will not supplant 
non-Federal funds pursuant to subsection (a), then the 
Federal funds apportioned to that State under this Act 
that will supplant non-Federal funds will be recaptured 
by the appropriate Federal agency and redistributed to 
States or agencies that can spend the Federal funds with-
out supplanting non-Federal funds. 
(c) PERIODIC REPORTS.— 
(1) IN GENERAL.—Notwithstanding any other 
provision of law, each grant recipient shall submit to 
the covered agency from which they received funding 
periodic reports on the use of the funds appropriated 
in this Act for covered programs. Such reports shall 
be collected and compiled by the covered agency and 
transmitted to Congress. 
(2) CONTENTS OF REPORTS.—For amounts re-
ceived under each covered program by a grant re-
cipient under this Act, the grant recipient shall in-
clude in the periodic reports information tracking— 
(A) the amount of Federal funds appro-
priated, allocated, obligated, and outlayed under 
the appropriation; 
(B) the number of projects that have been 
put out to bid under the appropriation and the
271 
amount of Federal funds associated with such 
projects; 
(C) the number of projects for which con-
tracts have been awarded under the appropria-
tion and the amount of Federal funds associ-
ated with such contracts; 
(D) the number of projects for which work 
has begun under such contracts and the 
amount of Federal funds associated with such 
contracts; 
(E) the number of projects for which work 
has been completed under such contracts and 
the amount of Federal funds associated with 
such contracts; 
(F) the number of jobs created or sus-
tained by the Federal funds provided for 
projects under the appropriation, including in-
formation on job sectors and pay levels; and 
(G) for each covered program report infor-
mation tracking the actual aggregate expendi-
tures by each grant recipient from non-Federal 
sources for projects eligible for funding under 
the program during the period beginning on the 
date of enactment of this Act through Sep-
tember 30, 2010, as compared to the level of
272 
such expenditures that were planned to occur 
during such period as of the date of enactment 
of this Act. 
(3) TIMING OF REPORTS.—Each grant recipient 
shall submit the first of the periodic reports required 
under this subsection not later than 30 days after 
the date of enactment of this Act and shall submit 
updated reports not later than 60 days, 120 days, 
180 days, 1 year, and 3 years after such date of en-
actment. 
(d) DEFINITIONS.—In this section, the following defi-
nitions apply: 
(1) COVERED
AGENCY.—The term ‘‘covered 
agency’’ means the Federal Aviation Administration, 
the Federal Highway Administration, the Federal 
Railroad Administration, and the Federal Transit 
Administration of the Department of Transpor-
tation. 
(2) COVERED
PROGRAM.—The term ‘‘covered 
program’’ means funds appropriated in this Act for 
‘‘Grants-in-Aid for Airports’’ to the Federal Aviation 
Administration; for ‘‘Highway Infrastructure Invest-
ment’’ to the Federal Highway Administration; for 
‘‘Capital Assistance for Intercity Passenger Rail 
Service’’ to the Federal Railroad Administration; for
273 
‘‘Transit Capital Assistance’’, ‘‘Fixed Guideway In-
frastructure Investment’’, and ‘‘Capital Investment 
Grants’’ to the Federal Transit Administration. 
(3) GRANT RECIPIENT.—The term ‘‘grant re-
cipient’’ means a State or other recipient of assist-
ance provided under a covered program in this Act. 
Such term does not include a Federal department or 
agency. 
SEC. 12002. FHA LOAN LIMITS FOR 2009. 
(a) LOAN LIMIT FLOOR BASED ON 2008 LEVELS.— 
For mortgages for which the mortgagee issues credit ap-
proval for the borrower during calendar year 2009, if the 
dollar amount limitation on the principal obligation of a 
mortgage determined under section 203(b)(2) of the Na-
tional Housing Act (12 U.S.C. 1709(b)(2)) for any size 
residence for any area is less than such dollar amount lim-
itation that was in effect for such size residence for such 
area for 2008 pursuant to section 202 of the Economic 
Stimulus Act of 2008 (Public Law 110–185; 122 Stat. 
620), notwithstanding any other provision of law, the max-
imum dollar amount limitation on the principal obligation 
of a mortgage for such size residence for such area for 
purposes of such section 203(b)(2) shall be considered (ex-
cept for purposes of section 255(g) of such Act (12 U.S.C.
274 
1715z–20(g))) to be such dollar amount limitation in ef-
fect for such size residence for such area for 2008. 
(b) DISCRETIONARY AUTHORITY FOR SUB-AREAS.— 
Notwithstanding any other provision of law, if the Sec-
retary of Housing and Urban Development determines, for 
any geographic area that is smaller than an area for which 
dollar amount limitations on the principal obligation of a 
mortgage are determined under section 203(b)(2) of the 
National Housing Act, that a higher such maximum dollar 
amount limitation is warranted for any particular size or 
sizes of residences in such sub-area by higher median 
home prices in such sub-area, the Secretary may, for mort-
gages for which the mortgagee issues credit approval for 
the borrower during calendar year 2009, increase the max-
imum dollar amount limitation for such size or sizes of 
residences for such sub-area that is otherwise in effect (in-
cluding pursuant to subsection (a) of this section), but in 
no case to an amount that exceeds the amount specified 
in section 202(a)(2) of the Economic Stimulus Act of 
2008. 
SEC. 12003. GSE CONFORMING LOAN LIMITS FOR 2009. 
(a) LOAN LIMIT FLOOR BASED ON 2008 LEVELS.— 
For mortgages originated during calendar year 2009, if 
the limitation on the maximum original principal obliga-
tion of a mortgage that may purchased by the Federal
275 
National Mortgage Association or the Federal Home Loan 
Mortgage Corporation determined under section 302(b)(2) 
of the Federal National Mortgage Association Charter Act 
(12 U.S.C. 1717(b)(2)) or section 305(a)(2) of the Fed-
eral Home Loan Mortgage Corporation Act (12 U.S.C. 
1754(a)(2)), respectively, for any size residence for any 
area is less than such maximum original principal obliga-
tion limitation that was in effect for such size residence 
for such area for 2008 pursuant to section 201 of the Eco-
nomic Stimulus Act of 2008 (Public Law 110–185; 122 
Stat. 619), notwithstanding any other provision of law, the 
limitation on the maximum original principal obligation of 
a mortgage for such Association and Corporation for such 
size residence for such area shall be such maximum limita-
tion in effect for such size residence for such area for 
2008. 
(b) DISCRETIONARY AUTHORITY FOR SUB-AREAS.— 
Notwithstanding any other provision of law, if the Direc-
tor of the Federal Housing Finance Agency determines, 
for any geographic area that is smaller than an area for 
which limitations on the maximum original principal obli-
gation of a mortgage are determined for the Federal Na-
tional Mortgage Association or the Federal Home Loan 
Mortgage Corporation, that a higher such maximum origi-
nal principal obligation limitation is warranted for any
276 
particular size or sizes of residences in such sub-area by 
higher median home prices in such sub-area, the Director 
may, for mortgages originated during 2009, increase the 
maximum original principal obligation limitation for such 
size or sizes of residences for such sub-area that is other-
wise in effect (including pursuant to subsection (a) of this 
section) for such Association and Corporation, but in no 
case to an amount that exceeds the amount specified in 
the matter following the comma in section 201(a)(1)(B) 
of the Economic Stimulus Act of 2008. 
SEC. 12004. FHA REVERSE MORTGAGE LOAN LIMITS FOR 
2009. 
For mortgages for which the mortgagee issues credit 
approval for the borrower during calendar year 2009, the 
second sentence of section 255(g) of the National Housing 
Act (12 U.S.C. 171520(g)) shall be considered to require 
that in no case may the benefits of insurance under such 
section 255 exceed 150 percent of the maximum dollar 
amount in effect under the sixth sentence of section 
305(a)(2) of the Federal Home Loan Mortgage Corpora-
tion Act (12 U.S.C. 1454(a)(2)).
277 
TITLE XIII—STATE FISCAL 
STABILIZATION FUND 
DEPARTMENT OF EDUCATION 
STATE FISCAL STABILIZATION FUND 
For necessary expenses for a State Fiscal Stabiliza-
tion Fund, $79,000,000,000, which shall be administered 
by 
the 
Department 
of 
Education, 
of 
which 
$39,500,000,000 shall become available on July 1, 2009, 
and remain available through September 30, 2010, and 
$39,500,000,000 shall become available on July 1, 2010, 
and remain available through September 30, 2011: Pro-
vided, That the provisions of section 1103 of this Act shall 
not apply to the funds reserved under section 13001(c) 
of this title: Provided further, That the amount made 
available under section 13001(b) of this title for adminis-
tration and oversight shall take the place of the set-aside 
under section 1106 of this Act. 
GENERAL PROVISIONS, THIS TITLE 
SEC. 13001. ALLOCATIONS. 
(a) OUTLYING AREAS.—From each year’s appropria-
tion to carry out this title, the Secretary of Education 
shall first allocate one half of 1 percent to the outlying 
areas on the basis of their respective needs, as determined 
by the Secretary, for activities consistent with this title
278 
under such terms and conditions as the Secretary may de-
termine. 
(b) ADMINISTRATION AND OVERSIGHT.—The Sec-
retary may, in addition, reserve up to $12,500,000 each 
year for administration and oversight of this title, includ-
ing for program evaluation. 
(c) RESERVATION FOR ADDITIONAL PROGRAMS.— 
After reserving funds under subsections (a) and (b), the 
Secretary shall reserve $7,500,000,000 each year for 
grants under sections 13006 and 13007. 
(d) STATE ALLOCATIONS.—After carrying out sub-
sections (a), (b), and (c), the Secretary shall allocate the 
remaining funds made available to carry out this title to 
the States as follows: 
(1) 61 percent on the basis of their relative 
population of individuals aged 5 through 24. 
(2) 39 percent on the basis of their relative 
total population. 
(e) STATE GRANTS.—From funds allocated under 
subsection (d), the Secretary shall make grants to the 
Governor of each State. 
(f) REALLOCATION.—The Governor shall return to 
the Secretary any funds received under subsection (e) that 
the Governor does not obligate within one year of receiving
279 
a grant, and the Secretary shall reallocate such funds to 
the remaining States in accordance with subsection (d). 
SEC. 13002. STATE USES OF FUNDS. 
(a) EDUCATION FUND.— 
(1) IN
GENERAL.—For each fiscal year, the 
Governor shall use at least 61 percent of the State’s 
allocation under section 13001 for the support of el-
ementary, secondary, and postsecondary education. 
(2) RESTORING 2008 STATE SUPPORT FOR EDU-
CATION.— 
(A) IN
GENERAL.—The Governor shall 
first use the funds described in paragraph (1)— 
(i) to provide the amount of funds, 
through the State’s principal elementary 
and secondary funding formula, that is 
needed to restore State support for elemen-
tary and secondary education to the fiscal 
year 2008 level; and 
(ii) to provide the amount of funds to 
public institutions of higher education in 
the State that is needed to restore State 
support for postsecondary education to the 
fiscal year 2008 level. 
(B) SHORTFALL.—If the Governor deter-
mines that the amount of funds available under
280 
paragraph (1) is insufficient to restore State 
support for education to the levels described in 
clauses (i) and (ii) of subparagraph (A), the 
Governor shall allocate those funds between 
those clauses in proportion to the relative short-
fall in State support for the education sectors 
described in those clauses. 
(3) SUBGRANTS TO IMPROVE BASIC PROGRAMS 
OPERATED
BY
LOCAL
EDUCATIONAL
AGENCIES.— 
After carrying out paragraph (2), the Governor shall 
use any funds remaining under paragraph (1) to 
provide local educational agencies in the State with 
subgrants based on their relative shares of funding 
under part A of title I of the Elementary and Sec-
ondary Education Act of 1965 (20 U.S.C. 6311 et 
seq.) for the most recent year for which data are 
available. 
(b) OTHER GOVERNMENT SERVICES.—For each fis-
cal year, the Governor may use up to 39 percent of the 
State’s allocation under section 1301 for public safety and 
other government services, which may include assistance 
for elementary and secondary education and public institu-
tions of higher education.
281 
SEC. 13003. USES OF FUNDS BY LOCAL EDUCATIONAL 
AGENCIES. 
(a) IN GENERAL.—A local educational agency that 
receives funds under this title may use the funds for any 
activity authorized by the Elementary and Secondary Edu-
cation Act of 1965 (20 U.S.C. 6301 et seq.) (‘‘ESEA’’), 
the Individuals with Disabilities Education Act (20 U.S.C. 
1400 et seq.) (‘‘IDEA’’), or the Carl D. Perkins Career 
and Technical Education Act of 2006 (20 U.S.C. 2301 
et seq.) (‘‘the Perkins Act’’). 
(b) PROHIBITION.—A local educational agency may 
not use funds received under this title for capital projects 
unless authorized by ESEA, IDEA, or the Perkins Act. 
SEC. 13004. USES OF FUNDS BY INSTITUTIONS OF HIGHER 
EDUCATION. 
(a) IN GENERAL.—A public institution of higher edu-
cation that receives funds under this title shall use the 
funds for education and general expenditures, and in such 
a way as to mitigate the need to raise tuition and fees 
for in-State students. 
(b) PROHIBITION.—An institution of higher edu-
cation may not use funds received under this title to in-
crease its endowment. 
(c) ADDITIONAL PROHIBITION.—An institution of 
higher education may not use funds received under this 
title for construction, renovation, or facility repair.
282 
SEC. 13005. STATE APPLICATIONS. 
(a) IN GENERAL.—The Governor of a State desiring 
to receive an allocation under section 13001 shall submit 
an annual application at such time, in such manner, and 
containing such information as the Secretary may reason-
ably require. 
(b) FIRST YEAR APPLICATION.—In the first of such 
applications, the Governor shall— 
(1) include the assurances described in sub-
section (e); 
(2) provide baseline data that demonstrates the 
State’s current status in each of the areas described 
in such assurances; and 
(3) describe how the State intends to use its al-
location. 
(c) SECOND YEAR APPLICATION.—In the second year 
application, the Governor shall— 
(1) include the assurances described in sub-
section (e); and 
(2) describe how the State intends to use its al-
location. 
(d) INCENTIVE GRANT APPLICATION.—The Governor 
of a State seeking a grant under section 13006 shall— 
(1) submit an application for consideration; 
(2) describe the status of the State’s progress 
in each of the areas described in subsection (e), and
283 
the strategies the State is employing to help ensure 
that high-need students in the State continue mak-
ing progress towards meeting the State’s student 
academic achievement standards; 
(3) describe how the State would use its grant 
funding, including how it will allocate the funds to 
give priority to high-need schools and local edu-
cational agencies; and 
(4) include a plan for evaluating its progress in 
closing achievement gaps. 
(e) ASSURANCES.—An application under subsection 
(b) or (c) shall include the following assurances: 
(1) MAINTENANCE OF EFFORT.— 
(A) ELEMENTARY AND SECONDARY EDU-
CATION.—The State will, in each of fiscal years 
2009 and 2010, maintain State support for ele-
mentary and secondary education at least at 
the level of such support in fiscal year 2006. 
(B) HIGHER EDUCATION.—The State will, 
in each of fiscal years 2009 and 2010, maintain 
State support for public institutions of higher 
education (not including support for capital 
projects or for research and development) at 
least at the level of such support in fiscal year 
2006.
284 
(2) ACHIEVING EQUITY IN TEACHER DISTRIBU-
TION.—The State will take actions to comply with 
section 
1111(b)(8)(C) 
of 
ESEA 
(20 
U.S.C. 
6311(b)(8)(C)) in order to address inequities in the 
distribution of teachers between high-and low-pov-
erty schools, and to ensure that low-income and mi-
nority children are not taught at higher rates than 
other children by inexperienced, unqualified, or out- 
of-field teachers. 
(3) IMPROVING
COLLECTION
AND
USE
OF 
DATA.—The State will establish a longitudinal data 
system that includes the elements described in sec-
tion 6401(e)(2)(D) of the America COMPETES Act 
(20 U.S.C. 9871). 
(4) ASSESSMENTS.—The State— 
(A) will enhance the quality of academic 
assessments described in section 1111(b)(3) of 
ESEA (20 U.S.C. 6311(b)(3)) through activi-
ties such as those described in section 6112(a) 
of such Act (20 U.S.C. 7301a(a)); and 
(B) will comply with the requirements of 
paragraphs 3(C)(ix) and (6) of section 1111(b) 
of ESEA (20 U.S.C. 6311(b)) and section 
612(a)(16) of IDEA (20 U.S.C. 1412(a)(16)) 
related to the inclusion of children with disabil-
285 
ities and limited English proficient students in 
State assessments, the development of valid and 
reliable assessments for those students, and the 
provision of accommodations that enable their 
participation in State assessments. 
SEC. 13006. STATE INCENTIVE GRANTS. 
(a) IN GENERAL.—From the total amount reserved 
under section 13001(c) that is not used for section 13007, 
the Secretary shall, in fiscal year 2010, make grants to 
States that have made significant progress in meeting the 
objectives of paragraphs (2), (3), and (4) of section 
13005(e). 
(b) BASIS FOR GRANTS.—The Secretary shall deter-
mine which States receive grants under this section, and 
the amount of those grants, on the basis of information 
provided in State applications under section 13005 and 
such other criteria as the Secretary determines appro-
priate. 
(c) SUBGRANTS
TO LOCAL EDUCATIONAL AGEN-
CIES.—Each State receiving a grant under this section 
shall use at least 50 percent of the grant to provide local 
educational agencies in the State with subgrants based on 
their relative shares of funding under part A of title I of 
ESEA (20 U.S.C. 6311 et seq.) for the most recent year.
286 
SEC. 13007. INNOVATION FUND. 
(a) IN GENERAL.— 
(1) PROGRAM ESTABLISHED.—From the total 
amount reserved under section 13001(c), the Sec-
retary may reserve up to $325,000,000 each year to 
establish an Innovation Fund, which shall consist of 
academic achievement awards that recognize States, 
local educational agencies, or schools that meet the 
requirements described in subsection (b). 
(2) BASIS FOR AWARDS.—The Secretary shall 
make awards to States, local educational agencies, 
or schools that have made significant gains in clos-
ing the achievement gap as described in subsection 
(b)(1)— 
(A) to allow such States, local educational 
agencies, and schools to expand their work and 
serve as models for best practices; 
(B) to allow such States, local educational 
agencies, and schools to work in partnership 
with the private sector and the philanthropic 
community; and 
(C) to identify and document best practices 
that can be shared, and taken to scale based on 
demonstrated success. 
(b) ELIGIBILITY.—To be eligible for such an award, 
a State, local educational agency, or school shall—
287 
(1) have significantly closed the achievement 
gaps between groups of students described in section 
1111(b)(2) of ESEA (20 U.S.C. 6311(b)(2)); 
(2) have exceeded the State’s annual measur-
able 
objectives 
consistent 
with 
such 
section 
1111(b)(2) for 2 or more consecutive years or have 
demonstrated success in significantly increasing stu-
dent academic achievement for all groups of stu-
dents described in such section through another 
measure, such as measures described in section 
1111(c)(2) of ESEA; 
(3) have made significant improvement in other 
areas, such as graduation rates or increased recruit-
ment and placement of high-quality teachers and 
school leaders, as demonstrated with meaningful 
data; and 
(4) demonstrate that they have established 
partnerships with the private sector, which may in-
clude philanthropic organizations, and that the pri-
vate sector will provide matching funds in order to 
help bring results to scale. 
SEC. 13008. STATE REPORTS. 
For each year of the program under this title, a State 
receiving funds under this title shall submit a report to
288 
the Secretary, at such time and in such manner as the 
Secretary may require, that describes— 
(1) the uses of funds provided under this title 
within the State; 
(2) how the State distributed the funds it re-
ceived under this title; 
(3) the number of jobs that the Governor esti-
mates were saved or created with funds the State re-
ceived under this title; 
(4) tax increases that the Governor estimates 
were averted because of the availability of funds 
from this title; 
(5) the State’s progress in reducing inequities 
in the distribution of teachers, in implementing a 
State student longitudinal data system, and in devel-
oping and implementing valid and reliable assess-
ments for limited English proficient students and 
children with disabilities; 
(6) the tuition and fee increases for in-State 
students imposed by public institutions of higher 
education in the State during the period of avail-
ability of funds under this title, and a description of 
any actions taken by the State to limit those in-
creases; and
289 
(7) the extent to which public institutions of 
higher education maintained, increased, or decreased 
enrollment of in-State students, including students 
eligible for Pell Grants or other need-based financial 
assistance. 
SEC. 13009. EVALUATION. 
The Comptroller General of the United States shall 
conduct evaluations of the programs under sections 13006 
and 13007 which shall include, but not be limited to, the 
criteria used for the awards made, the States selected for 
awards, award amounts, how each State used the award 
received, and the impact of this funding on the progress 
made toward closing achievement gaps. 
SEC. 13010. SECRETARY’S REPORT TO CONGRESS. 
The Secretary shall submit a report to the Committee 
on Education and Labor of the House of Representatives, 
the Committee on Health, Education, Labor, and Pen-
sions of the Senate, and the Committees on Appropria-
tions of the House of Representatives and of the Senate, 
not less than 6 months following the submission of State 
reports, that evaluates the information provided in the 
State reports under section 13008.
290 
SEC. 13011. PROHIBITION ON PROVISION OF CERTAIN AS-
SISTANCE. 
No recipient of funds under this title shall use such 
funds to provide financial assistance to students to attend 
private elementary or secondary schools. 
SEC. 13012. DEFINITIONS. 
Except as otherwise provided in this title, as used in 
this title— 
(1) the term ‘‘institution of higher education’’ 
has the meaning given such term in section 101 of 
the Higher Education Act of 1965 (20 U.S.C. 
1001); 
(2) the term ‘‘Secretary’’ means the Secretary 
of Education; 
(3) the term ‘‘State’’ means each of the 50 
States, the District of Columbia, and the Common-
wealth of Puerto Rico; and 
(4) any other term used in this title that is de-
fined in section 9101 of ESEA (20 U.S.C. 7801) 
shall have the meaning given the term in that sec-
tion.
291 
DIVISION B—OTHER 
PROVISIONS 
TITLE I—TAX PROVISIONS 
SEC. 1000. SHORT TITLE, ETC. 
(a) SHORT TITLE.—This title may be cited as the 
‘‘American Recovery and Reinvestment Tax Act of 2009’’. 
(b) REFERENCE.—Except as otherwise expressly pro-
vided, whenever in this title an amendment or repeal is 
expressed in terms of an amendment to, or repeal of, a 
section or other provision, the reference shall be consid-
ered to be made to a section or other provision of the In-
ternal Revenue Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents for 
this title is as follows: 
Sec. 1000. Short title, etc. 
Subtitle A—Making Work Pay 
Sec. 1001. Making work pay credit. 
Subtitle B—Additional Tax Relief for Families With Children 
Sec. 1101. Increase in earned income tax credit. 
Sec. 1102. Increase of refundable portion of child credit. 
Subtitle C—American Opportunity Tax Credit 
Sec. 1201. American opportunity tax credit. 
Subtitle D—Housing Incentives 
Sec. 1301. Waiver of requirement to repay first-time homebuyer credit. 
Sec. 1302. Coordination of low-income housing credit and low-income housing 
grants. 
Subtitle E—Tax Incentives for Business 
PART 1—TEMPORARY INVESTMENT INCENTIVES 
Sec. 1401. Special allowance for certain property acquired during 2009.
292 
Sec. 1402. Temporary increase in limitations on expensing of certain depre-
ciable business assets. 
PART 2—5-YEAR CARRYBACK OF OPERATING LOSSES 
Sec. 1411. 5-year carryback of operating losses. 
Sec. 1412. Exception for TARP recipients. 
PART 3—INCENTIVES FOR NEW JOBS 
Sec. 1421. Incentives to hire unemployed veterans and disconnected youth. 
PART 4—CLARIFICATION OF REGULATIONS RELATED TO LIMITATIONS ON 
CERTAIN BUILT-IN LOSSES FOLLOWING AN OWNERSHIP CHANGE 
Sec. 1431. Clarification of regulations related to limitations on certain built-in 
losses following an ownership change. 
Subtitle F—Fiscal Relief for State and Local Governments 
PART 1—IMPROVED MARKETABILITY FOR TAX-EXEMPT BONDS 
Sec. 1501. De minimis safe harbor exception for tax-exempt interest expense of 
financial institutions. 
Sec. 1502. Modification of small issuer exception to tax-exempt interest expense 
allocation rules for financial institutions. 
Sec. 1503. Temporary modification of alternative minimum tax limitations on 
tax-exempt bonds. 
PART 2—TAX CREDIT BONDS FOR SCHOOLS 
Sec. 1511. Qualified school construction bonds. 
Sec. 1512. Extension and expansion of qualified zone academy bonds. 
PART 3—TAXABLE BOND OPTION FOR GOVERNMENTAL BONDS 
Sec. 1521. Taxable bond option for governmental bonds. 
PART 4—RECOVERY ZONE BONDS 
Sec. 1531. Recovery zone bonds. 
Sec. 1532. Tribal economic development bonds. 
PART 5—REPEAL OF WITHHOLDING TAX ON GOVERNMENT CONTRACTORS 
Sec. 1541. Repeal of withholding tax on government contractors. 
Subtitle G—Energy Incentives 
PART 1—RENEWABLE ENERGY INCENTIVES 
Sec. 1601. Extension of credit for electricity produced from certain renewable 
resources. 
Sec. 1602. Election of investment credit in lieu of production credit. 
Sec. 1603. Repeal of certain limitations on credit for renewable energy prop-
erty. 
Sec. 1604. Coordination with renewable energy grants. 
PART 2—INCREASED ALLOCATIONS OF NEW CLEAN RENEWABLE ENERGY 
BONDS AND QUALIFIED ENERGY CONSERVATION BONDS
293 
Sec. 1611. Increased limitation on issuance of new clean renewable energy 
bonds. 
Sec. 1612. Increased limitation and expansion of qualified energy conservation 
bonds. 
PART 3—ENERGY CONSERVATION INCENTIVES 
Sec. 1621. Extension and modification of credit for nonbusiness energy prop-
erty. 
Sec. 1622. Modification of credit for residential energy efficient property. 
Sec. 1623. Temporary increase in credit for alternative fuel vehicle refueling 
property. 
PART 4—ENERGY RESEARCH INCENTIVES 
Sec. 1631. Increased research credit for energy research. 
Subtitle H—Other Provisions 
PART 1—APPLICATION OF CERTAIN LABOR STANDARDS TO PROJECTS 
FINANCED WITH CERTAIN TAX-FAVORED BONDS 
Sec. 1701. Application of certain labor standards to projects financed with cer-
tain tax-favored bonds. 
PART 2—GRANTS TO PROVIDE FINANCING FOR LOW-INCOME HOUSING 
Sec. 1711. Grants to States for low-income housing projects in lieu of low-in-
come housing credit allocations for 2009. 
PART 3—GRANTS FOR SPECIFIED ENERGY PROPERTY IN LIEU OF TAX 
CREDITS 
Sec. 1721. Grants for specified energy property in lieu of tax credits. 
PART 4—STUDY OF ECONOMIC, EMPLOYMENT, AND RELATED EFFECTS OF 
THIS ACT 
Sec. 1731. Study of economic, employment, and related effects of this Act. 
Subtitle A—Making Work Pay 
SEC. 1001. MAKING WORK PAY CREDIT. 
(a) IN GENERAL.—Subpart C of part IV of sub-
chapter A of chapter 1 is amended by inserting after sec-
tion 36 the following new section: 
‘‘SEC. 36A. MAKING WORK PAY CREDIT. 
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an eli-
gible individual, there shall be allowed as a credit against
296 
sion of the United States with a mirror code 
tax system amounts equal to the loss to that 
possession by reason of the amendments made 
by this section with respect to taxable years be-
ginning in 2009 and 2010. Such amounts shall 
be determined by the Secretary of the Treasury 
based on information provided by the govern-
ment of the respective possession. 
(B) OTHER POSSESSIONS.—The Secretary 
of the Treasury shall pay to each possession of 
the United States which does not have a mirror 
code tax system amounts estimated by the Sec-
retary of the Treasury as being equal to the ag-
gregate benefits that would have been provided 
to residents of such possession by reason of the 
amendments made by this section for taxable 
years beginning in 2009 and 2010 if a mirror 
code tax system had been in effect in such pos-
session. The preceding sentence shall not apply 
with respect to any possession of the United 
States unless such possession has a plan, which 
has been approved by the Secretary of the 
Treasury, under which such possession will 
promptly distribute such payments to the resi-
dents of such possession.
297 
(2) COORDINATION
WITH
CREDIT
ALLOWED 
AGAINST UNITED STATES INCOME TAXES.—No cred-
it shall be allowed against United States income 
taxes for any taxable year under section 36A of the 
Internal Revenue Code of 1986 (as added by this 
section) to any person— 
(A) to whom a credit is allowed against 
taxes imposed by the possession by reason of 
the amendments made by this section for such 
taxable year, or 
(B) who is eligible for a payment under a 
plan described in paragraph (1)(B) with respect 
to such taxable year. 
(3) DEFINITIONS AND SPECIAL RULES.— 
(A) 
POSSESSION
OF
THE
UNITED 
STATES.—For purposes of this subsection, the 
term ‘‘possession of the United States’’ includes 
the Commonwealth of Puerto Rico and the 
Commonwealth of the Northern Mariana Is-
lands. 
(B) MIRROR CODE TAX SYSTEM.—For pur-
poses of this subsection, the term ‘‘mirror code 
tax system’’ means, with respect to any posses-
sion of the United States, the income tax sys-
tem of such possession if the income tax liabil-
298 
ity of the residents of such possession under 
such system is determined by reference to the 
income tax laws of the United States as if such 
possession were the United States. 
(C) TREATMENT OF PAYMENTS.—For pur-
poses of section 1324(b)(2) of title 31, United 
States Code, the payments under this sub-
section shall be treated in the same manner as 
a refund due from the credit allowed under sec-
tion 36A of the Internal Revenue Code of 1986 
(as added by this section). 
(c) REFUNDS DISREGARDED IN THE ADMINISTRA-
TION
OF FEDERAL PROGRAMS
AND FEDERALLY AS-
SISTED PROGRAMS.—Any credit or refund allowed or 
made to any individual by reason of section 36A of the 
Internal Revenue Code of 1986 (as added by this section) 
or by reason of subsection (b) of this section shall not be 
taken into account as income and shall not be taken into 
account as resources for the month of receipt and the fol-
lowing 2 months, for purposes of determining the eligi-
bility of such individual or any other individual for benefits 
or assistance, or the amount or extent of benefits or assist-
ance, under any Federal program or under any State or 
local program financed in whole or in part with Federal 
funds.
299 
(d) CONFORMING AMENDMENTS.— 
(1) Section 6211(b)(4)(A) is amended by insert-
ing ‘‘36A,’’ after ‘‘36,’’. 
(2) Section 1324(b)(2) of title 31, United 
States Code, is amended by inserting ‘‘36A,’’ after 
‘‘36,’’. 
(3) The table of sections for subpart C of part 
IV of subchapter A of chapter 1 is amended by in-
serting after the item relating to section 36 the fol-
lowing new item: 
‘‘Sec. 36A. Making work pay credit.’’. 
(e) EFFECTIVE DATE.—This section shall apply to 
taxable years beginning after December 31, 2008. 
Subtitle B—Additional Tax Relief 
for Families With Children 
SEC. 1101. INCREASE IN EARNED INCOME TAX CREDIT. 
(a) IN GENERAL.—Subsection (b) of section 32 is 
amended by adding at the end the following new para-
graph: 
‘‘(3) SPECIAL RULES FOR 2009 AND 2010.—In 
the case of any taxable year beginning in 2009 or 
2010— 
‘‘(A) INCREASED
CREDIT
PERCENTAGE 
FOR 3 OR MORE QUALIFYING CHILDREN.—In 
the case of a taxpayer with 3 or more qualifying 
children, the credit percentage is 45 percent.
300 
‘‘(B) REDUCTION
OF
MARRIAGE
PEN-
ALTY.— 
‘‘(i) IN GENERAL.—The dollar amount 
in effect under paragraph (2)(B) shall be 
$5,000. 
‘‘(ii) INFLATION
ADJUSTMENT.—In 
the case of any taxable year beginning in 
2010, the $5,000 amount in clause (i) 
shall be increased by an amount equal to— 
‘‘(I) such dollar amount, multi-
plied by 
‘‘(II) the cost of living adjust-
ment determined under section 1(f)(3) 
for the calendar year in which the tax-
able year begins determined by sub-
stituting ‘calendar year 2008’ for ‘cal-
endar year 1992’ in subparagraph (B) 
thereof. 
‘‘(iii) ROUNDING.—Subparagraph (A) 
of subsection (j)(2) shall apply after taking 
into account any increase under clause 
(ii).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008.
301 
SEC. 1102. INCREASE OF REFUNDABLE PORTION OF CHILD 
CREDIT. 
(a) IN GENERAL.—Paragraph (4) of section 24(d) is 
amended to read as follows: 
‘‘(4) SPECIAL RULE FOR 2009 AND 2010.—Not-
withstanding paragraph (3), in the case of any tax-
able year beginning in 2009 or 2010, the dollar 
amount in effect for such taxable year under para-
graph (1)(B)(i) shall be zero.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
Subtitle C—American Opportunity 
Tax Credit 
SEC. 1201. AMERICAN OPPORTUNITY TAX CREDIT. 
(a) IN GENERAL.—Section 25A (relating to Hope 
scholarship credit) is amended by redesignating subsection 
(i) as subsection (j) and by inserting after subsection (h) 
the following new subsection: 
‘‘(i) AMERICAN OPPORTUNITY TAX CREDIT.—In the 
case of any taxable year beginning in 2009 or 2010— 
‘‘(1) INCREASE IN CREDIT.—The Hope Scholar-
ship Credit shall be an amount equal to the sum 
of— 
‘‘(A) 100 percent of so much of the quali-
fied tuition and related expenses paid by the
302 
taxpayer during the taxable year (for education 
furnished to the eligible student during any 
academic period beginning in such taxable year) 
as does not exceed $2,000, plus 
‘‘(B) 25 percent of such expenses so paid 
as exceeds $2,000 but does not exceed $4,000. 
‘‘(2) CREDIT ALLOWED FOR FIRST 4 YEARS OF 
POST-SECONDARY EDUCATION.—Subparagraphs (A) 
and (C) of subsection (b)(2) shall be applied by sub-
stituting ‘4’ for ‘2’. 
‘‘(3) QUALIFIED
TUITION
AND
RELATED
EX-
PENSES
TO
INCLUDE
REQUIRED
COURSE
MATE-
RIALS.—Subsection (f)(1)(A) shall be applied by 
substituting ‘tuition, fees, and course materials’ for 
‘tuition and fees’. 
‘‘(4) INCREASE
IN
AGI
LIMITS
FOR
HOPE 
SCHOLARSHIP
CREDIT.—In lieu of applying sub-
section (d) with respect to the Hope Scholarship 
Credit, such credit (determined without regard to 
this paragraph) shall be reduced (but not below 
zero) by the amount which bears the same ratio to 
such credit (as so determined) as— 
‘‘(A) the excess of—
303 
‘‘(i) the taxpayer’s modified adjusted 
gross income (as defined in subsection 
(d)(3)) for such taxable year, over 
‘‘(ii) $80,000 ($160,000 in the case of 
a joint return), bears to 
‘‘(B) $10,000 ($20,000 in the case of a 
joint return). 
‘‘(5) CREDIT ALLOWED AGAINST ALTERNATIVE 
MINIMUM TAX.—In the case of a taxable year to 
which section 26(a)(2) does not apply, so much of 
the credit allowed under subsection (a) as is attrib-
utable to the Hope Scholarship Credit shall not ex-
ceed the excess of— 
‘‘(A) the sum of the regular tax liability 
(as defined in section 26(b)) plus the tax im-
posed by section 55, over 
‘‘(B) the sum of the credits allowable 
under this subpart (other than this subsection 
and sections 23, 25D, and 30D) and section 27 
for the taxable year. 
Any reference in this section or section 24, 25, 26, 
25B, 904, or 1400C to a credit allowable under this 
subsection shall be treated as a reference to so much 
of the credit allowable under subsection (a) as is at-
tributable to the Hope Scholarship Credit.
304 
‘‘(6) PORTION
OF
CREDIT
MADE
REFUND-
ABLE.—40 percent of so much of the credit allowed 
under subsection (a) as is attributable to the Hope 
Scholarship Credit (determined after application of 
paragraph (4) and without regard to this paragraph 
and section 26(a)(2) or paragraph (5), as the case 
may be) shall be treated as a credit allowable under 
subpart C (and not allowed under subsection (a)). 
The preceding sentence shall not apply to any tax-
payer for any taxable year if such taxpayer is a child 
to whom subsection (g) of section 1 applies for such 
taxable year. 
‘‘(7) COORDINATION
WITH
MIDWESTERN
DIS-
ASTER AREA BENEFITS.—In the case of a taxpayer 
with respect to whom section 702(a)(1)(B) of the 
Heartland Disaster Tax Relief Act of 2008 applies 
for any taxable year, such taxpayer may elect to 
waive the application of this subsection to such tax-
payer for such taxable year.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 24(b)(3)(B) is amended by inserting 
‘‘25A(i),’’ after ‘‘23,’’. 
(2) Section 25(e)(1)(C)(ii) is amended by in-
serting ‘‘25A(i),’’ after ‘‘24,’’.
305 
(3) Section 26(a)(1) is amended by inserting 
‘‘25A(i),’’ after ‘‘24,’’. 
(4) Section 25B(g)(2) is amended by inserting 
‘‘25A(i),’’ after ‘‘23,’’. 
(5) Section 904(i) is amended by inserting 
‘‘25A(i),’’ after ‘‘24,’’. 
(6) Section 1400C(d)(2) is amended by insert-
ing ‘‘25A(i),’’ after ‘‘24,’’. 
(7) Section 1324(b)(2) of title 31, United 
States Code, is amended by inserting ‘‘25A,’’ before 
‘‘35’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
(d) APPLICATION
OF
EGTRRA SUNSET.—The 
amendment made by subsection (b)(1) shall be subject to 
title IX of the Economic Growth and Tax Relief Reconcili-
ation Act of 2001 in the same manner as the provision 
of such Act to which such amendment relates. 
(e) TREASURY STUDIES REGARDING EDUCATION IN-
CENTIVES.— 
(1) STUDY
REGARDING
COORDINATION
WITH 
NON-TAX
EDUCATIONAL
INCENTIVES.—The Sec-
retary of the Treasury, or the Secretary’s delegate, 
shall study how to coordinate the credit allowed
306 
under section 25A of the Internal Revenue Code of 
1986 with the Federal Pell Grant program under 
section 401 of the Higher Education Act of 1965. 
(2) STUDY REGARDING IMPOSITION OF COMMU-
NITY
SERVICE
REQUIREMENTS.—The Secretary of 
the Treasury, or the Secretary’s delegate, shall study 
the feasibility of requiring students to perform com-
munity service as a condition of taking their tuition 
and related expenses into account under section 25A 
of the Internal Revenue Code of 1986. 
(3) REPORT.—Not later than 1 year after the 
date of the enactment of this Act, the Secretary of 
the Treasury, or the Secretary’s delegate, shall re-
port to Congress on the results of the studies con-
ducted under this paragraph. 
Subtitle D—Housing Incentives 
SEC. 1301. WAIVER OF REQUIREMENT TO REPAY FIRST- 
TIME HOMEBUYER CREDIT. 
(a) IN GENERAL.—Paragraph (4) of section 36(f) is 
amended by adding at the end the following new subpara-
graph: 
‘‘(D) WAIVER OF RECAPTURE FOR PUR-
CHASES IN 2009.—In the case of any credit al-
lowed with respect to the purchase of a prin-
307 
cipal residence after December 31, 2008, and 
before July 1, 2009— 
‘‘(i) paragraph (1) shall not apply, 
and 
‘‘(ii) paragraph (2) shall apply only if 
the disposition or cessation described in 
paragraph (2) with respect to such resi-
dence occurs during the 36-month period 
beginning on the date of the purchase of 
such residence by the taxpayer.’’. 
(b) CONFORMING AMENDMENT.—Subsection (g) of 
section 36 is amended by striking ‘‘subsection (c)’’ and 
inserting ‘‘subsections (c) and (f)(4)(D)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to residences purchased after De-
cember 31, 2008. 
SEC. 1302. COORDINATION OF LOW-INCOME HOUSING 
CREDIT AND LOW-INCOME HOUSING GRANTS. 
Subsection (i) of section 42 of the Internal Revenue 
Code of 1986 is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(9) COORDINATION WITH LOW-INCOME HOUS-
ING GRANTS.— 
‘‘(A) REDUCTION
IN
STATE
HOUSING 
CREDIT
CEILING
FOR
LOW-INCOME
HOUSING
308 
GRANTS RECEIVED IN 2009.—For purposes of 
this section, the amounts described in clauses 
(i) through (iv) of subsection (h)(3)(C) with re-
spect to any State for 2009 shall each be re-
duced by so much of such amount as is taken 
into account in determining the amount of any 
grant to such State under section 1711 of the 
American Recovery and Reinvestment Tax Act 
of 2009. 
‘‘(B) SPECIAL RULE FOR BASIS.—Basis of 
a qualified low-income building shall not be re-
duced by the amount of any grant described in 
subparagraph (A).’’. 
Subtitle E—Tax Incentives for 
Business 
PART 1—TEMPORARY INVESTMENT INCENTIVES 
SEC. 1401. SPECIAL ALLOWANCE FOR CERTAIN PROPERTY 
ACQUIRED DURING 2009. 
(a) IN GENERAL.—Paragraph (2) of section 168(k) 
is amended— 
(1) by striking ‘‘January 1, 2010’’ and insert-
ing ‘‘January 1, 2011’’, and 
(2) by striking ‘‘January 1, 2009’’ each place 
it appears and inserting ‘‘January 1, 2010’’. 
(b) CONFORMING AMENDMENTS.—
309 
(1) The heading for subsection (k) of section 
168 is amended by striking ‘‘JANUARY 1, 2009’’ and 
inserting ‘‘JANUARY 1, 2010’’. 
(2) The heading for clause (ii) of section 
168(k)(2)(B) is amended by striking ‘‘PRE-JANUARY 
1, 2009’’ and inserting ‘‘PRE-JANUARY 1, 2010’’. 
(3) Subparagraph (D) of section 168(k)(4) is 
amended— 
(A) by striking ‘‘and’’ at the end of clause 
(i), 
(B) by redesignating clause (ii) as clause 
(v), and 
(C) by inserting after clause (i) the fol-
lowing new clauses: 
‘‘(ii) ‘April 1, 2008’ shall be sub-
stituted for ‘January 1, 2008’ in subpara-
graph (A)(iii)(I) thereof, 
‘‘(iii) ‘January 1, 2009’ shall be sub-
stituted for ‘January 1, 2010’ each place it 
appears, 
‘‘(iv) ‘January 1, 2010’ shall be sub-
stituted for ‘January 1, 2011’ in subpara-
graph (A)(iv) thereof, and’’.
310 
(4) Subparagraph (B) of section 168(l)(5) is 
amended by striking ‘‘January 1, 2009’’ and insert-
ing ‘‘January 1, 2010’’. 
(5) Subparagraph (B) of section 1400N(d)(3) 
is amended by striking ‘‘January 1, 2009’’ and in-
serting ‘‘January 1, 2010’’. 
(c) EFFECTIVE DATES.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section 
shall apply to property placed in service after De-
cember 31, 2008, in taxable years ending after such 
date. 
(2) 
TECHNICAL
AMENDMENT.—Section 
168(k)(4)(D)(ii) of the Internal Revenue Code of 
1986, as added by subsection (b)(3)(C), shall apply 
to taxable years ending after March 31, 2008. 
SEC. 1402. TEMPORARY INCREASE IN LIMITATIONS ON EX-
PENSING OF CERTAIN DEPRECIABLE BUSI-
NESS ASSETS. 
(a) IN GENERAL.—Paragraph (7) of section 179(b) 
is amended— 
(1) by striking ‘‘2008’’ and inserting ‘‘2008, or 
2009’’, and 
(2) by striking ‘‘2008’’ in the heading thereof 
and inserting ‘‘2008, AND 2009’’.
311 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
PART 2—5-YEAR CARRYBACK OF OPERATING 
LOSSES 
SEC. 1411. 5-YEAR CARRYBACK OF OPERATING LOSSES. 
(a) IN GENERAL.—Subparagraph (H) of section 
172(b)(1) is amended to read as follows: 
‘‘(H) CARRYBACK FOR 2008 AND 2009 NET 
OPERATING LOSSES.— 
‘‘(i) IN GENERAL.—In the case of an 
applicable 2008 or 2009 net operating loss 
with respect to which the taxpayer has 
elected the application of this subpara-
graph— 
‘‘(I) such net operating loss shall 
be reduced by 10 percent of such loss 
(determined without regard to this 
subparagraph), 
‘‘(II) subparagraph (A)(i) shall 
be applied by substituting any whole 
number elected by the taxpayer which 
is more than 2 and less than 6 for ‘2’, 
‘‘(III) subparagraph (E)(ii) shall 
be applied by substituting the whole
312 
number which is one less than the 
whole number substituted under sub-
clause (II) for ‘2’, and 
‘‘(IV) subparagraph (F) shall not 
apply. 
‘‘(ii) APPLICABLE 2008 OR 2009 NET 
OPERATING
LOSS.—For purposes of this 
subparagraph, the term ‘applicable 2008 
or 2009 net operating loss’ means— 
‘‘(I) the taxpayer’s net operating 
loss for any taxable year ending in 
2008 or 2009, or 
‘‘(II) if the taxpayer elects to 
have this subclause apply in lieu of 
subclause (I), the taxpayer’s net oper-
ating loss for any taxable year begin-
ning in 2008 or 2009. 
‘‘(iii) ELECTION.—Any election under 
this subparagraph shall be made in such 
manner as may be prescribed by the Sec-
retary, and shall be made by the due date 
(including extension of time) for filing the 
taxpayer’s return for the taxable year of 
the net operating loss. Any such election, 
once made, shall be irrevocable.
337 
‘‘(d) TAXABLE GOVERNMENTAL BOND.— 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, the term ‘taxable governmental bond’ means 
any obligation (other than a private activity bond) 
if— 
‘‘(A) the interest on such obligation would 
(but for this section) be excludable from gross 
income under section 103, and 
‘‘(B) the issuer makes an irrevocable elec-
tion to have this section apply. 
‘‘(2) APPLICABLE RULES.—For purposes of ap-
plying paragraph (1)— 
‘‘(A) a taxable governmental bond shall not 
be treated as federally guaranteed by reason of 
the credit allowed under subsection (a) or sec-
tion 6432, 
‘‘(B) the yield on a taxable governmental 
bond shall be determined without regard to the 
credit allowed under subsection (a), and 
‘‘(C) a bond shall not be treated as a tax-
able governmental bond if the issue price has 
more than a de minimis amount (determined 
under rules similar to the rules of section 
1273(a)(3)) of premium over the stated prin-
cipal amount of the bond.