I 
109TH CONGRESS 
1ST SESSION H. R. 3451
To amend the Internal Revenue Code of 1986 to provide for the use of 
redevelopment bonds for environmental remediation. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 27, 2005
Ms. HART introduced the following bill; which was referred to the Committee 
on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
for the use of redevelopment bonds for environmental 
remediation.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. USE OF REDEVELOPMENT BONDS FOR ENVI-
RONMENTAL REMEDIATION. 
(a) ENVIRONMENTAL REMEDIATION INCLUDED AS 
REDEVELOPMENT PURPOSE.—Subparagraph (A) of sec-
tion 144(c)(3) of the Internal Revenue Code of 1986 (re-
lating to redevelopment purposes) is amended by striking 
‘‘and’’ at the end of clause (iii), by striking the period
at the end of clause (iv) and inserting ‘‘, and’’, and by 
adding at the end the following new clause: 
‘‘(v) the costs of environmental reme-
diation (as defined in paragraph (9)(B)) 
with respect to a qualified contaminated 
site (as defined in paragraph (9)(C)) if 
such costs are incurred pursuant to an en-
vironmental remediation plan which was 
approved by the Administrator of the Envi-
ronmental Protection Agency or by the 
head of any State or local government 
agency designated by the Administrator to 
carry out the Administrator’s functions 
under this clause.’’. 
(b) CERTAIN REQUIREMENTS NOT TO APPLY TO RE-
DEVELOPMENT BONDS FOR ENVIRONMENTAL REMEDI-
ATION.—Subsection (c) of section 144 of such Code is 
amended by adding at the end the following new para-
graph: 
‘‘(9) REDEVELOPMENT BONDS FOR ENVIRON-
MENTAL REMEDIATION.—For purposes of clause (v) 
of paragraph (3)(A)—
‘‘(A) CERTAIN
REQUIREMENTS
NOT
TO 
APPLY.—In the case of any bond issued as part 
of an issue 95 percent or more of the proceeds
of which are to finance costs referred to in 
paragraph (3)(A)(v)—
‘‘(i) paragraph (2)(A)(i) shall not 
apply, 
‘‘(ii) paragraph (2)(A)(ii) shall not 
apply to any issue issued by the governing 
body described in paragraph (4)(A) with 
respect to the area which includes the site, 
‘‘(iii) the requirement of paragraph 
(2)(B)(ii) shall be treated as met if—
‘‘(I) the payment of the principal 
and interest on such issue is secured 
by taxes imposed by a governmental 
unit, or 
‘‘(II) such issue is approved by 
the applicable elected representative 
(as defined in section 147(f)(2)(E)) of 
the governmental unit which issued 
such issue (or on behalf of which such 
issue was issued), 
‘‘(iv) subparagraphs (C) and (D) of 
paragraph (2) shall not apply, 
‘‘(v) subparagraphs (C) and (D) of 
paragraph (4) shall not apply, and
‘‘(vi) if the real property referred to in 
clause (iii) of paragraph (3)(A) is 1 or 
more dwelling units, such clause shall 
apply only if the requirements of section 
142(d) or 143 (as the case may be) are 
met with respect to such units. 
‘‘(B) ENVIRONMENTAL
REMEDIATION.—
The term ‘environmental remediation’ means—
‘‘(i) abatement or control of haz-
ardous substances (as defined by section 
101 of the Comprehensive Environmental 
Response, Compensation, and Liability Act 
of 1980 (42 U.S.C. 9601)), 
‘‘(ii) demolition of existing contami-
nated structures, permit fees necessary for 
remediation, and environmental audits, 
‘‘(iii) health assessments or health ef-
fects studies related to the site, and 
‘‘(iv) remediation of off-site contami-
nation caused by activity on the site (other 
than remediation activities of a type per-
mitted for the site). 
‘‘(C) QUALIFIED CONTAMINATED SITE.—
The term ‘qualified contaminated site’ means 
any contaminated site if—
‘‘(i) the condition of the contaminated 
site is such that without funding under 
this section redevelopment is unlikely, 
‘‘(ii) the contaminated site has not 
been in productive use for at least 1 year 
before such funding, 
‘‘(iii) there is a strong likelihood of re-
development of the site for industrial or 
commercial use that will result in creation 
of jobs and expansion of the tax base, and 
‘‘(iv) environmental remediation and 
redevelopment are likely to be completed 
within a reasonable period of time.’’. 
(c) PENALTY
FOR FAILURE
TO SATISFACTORILY 
COMPLETE REMEDIATION PLAN.—Subsection (b) of sec-
tion 150 of such Code is amended by adding at the end 
thereof the following new paragraph: 
‘‘(7) QUALIFIED CONTAMINATED SITE REMEDI-
ATION BONDS.—In the case of financing provided for 
costs described in section 144(c)(3)(A)(v), no deduc-
tion shall be allowed under this chapter for interest 
on such financing during any period during which 
there is a determination by the Administrator of the 
Environmental Protection Agency (or by the head of 
any State or local government agency designated by
the Administrator to carry out the Administrator’s 
functions under this paragraph) that the remedi-
ation plan under which such costs were incurred was 
not satisfactorily completed.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to bonds issued after the date of 
the enactment of this Act.
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