‘‘SEC. 1400U–4. EXTENSION OF RECOVERY ZONE ECONOMIC 
DEVELOPMENT BONDS FOR CERTAIN CITIES. 
‘‘(a) IN GENERAL.—In the case of an economic devel-
opment extension bond— 
‘‘(1) such bond shall be treated for purposes of 
section 6431 as a qualified bond issued before Janu-
ary 1, 2011, 
‘‘(2) subsection (b) of such section shall be ap-
plied by substituting ‘45 percent’ for ‘35 percent’, 
and 
‘‘(3) interest on such bond shall be includible in 
gross income. 
‘‘(b) 
ECONOMIC
DEVELOPMENT
EXTENSION 
BOND.—For purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘economic devel-
opment extension bond’ means any specified bond 
issued during the 1-year period beginning on the 
date of the enactment of this section as part of an 
issue if— 
‘‘(A) 100 percent of the excess of— 
‘‘(i) the available project proceeds (as 
defined in section 54A) of such issue, over 
‘‘(ii) the amounts in a reasonably re-
quired reserve (within the meaning of sec-
tion 150(a)(3)) with respect to such issue, 
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are to be used for one or more qualified pur-
poses, and 
‘‘(B) the issuer designates such bond for 
purposes of this section. 
‘‘(2) SPECIFIED BOND.— 
‘‘(A) IN
GENERAL.—The term ‘specified 
bond’ means any obligation (other than a pri-
vate activity bond) if the interest on such obli-
gation would (but for this section) be excludable 
from gross income under section 103. 
‘‘(B) APPLICABLE RULES.—For purposes 
of applying subparagraph (A)— 
‘‘(i) rules similar to the rules of sec-
tion 54AA(d)(2) shall apply, and 
‘‘(ii) section 148 shall not apply with 
respect to any issue with respect to which 
the excess described in paragraph (1)(A) is 
used for a qualified purpose described in 
paragraph (3)(B). 
‘‘(3) QUALIFIED PURPOSES.—The term ‘quali-
fied purposes’ means— 
‘‘(A) any qualified economic development 
purpose (as defined in section 1400U–2(c), ap-
plied by treating specified cities (and only speci-
fied cities) as recovery zones), and 
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‘‘(B) any refinancing of indebtedness of a 
specified city which is outstanding on the date 
of the enactment of this section. 
‘‘(4) SPECIFIED
CITY.—The term ‘specified 
city’ means any principal city for a metropolitan sta-
tistical area (as determined by the Office of Manage-
ment and Budget) which— 
‘‘(A) has an average unemployment rate of 
not less than 150 percent of the national aver-
age rate for the last calendar year ending be-
fore the date of the enactment of this section, 
and 
‘‘(B) has lost at least 20 percent of its 
population between calendar year 2000 and cal-
endar year 2010. 
‘‘(5) LIMITATION ON AMOUNT OF BONDS DES-
IGNATED.— 
‘‘(A) IN GENERAL.—The maximum aggre-
gate face amount of bonds which may be des-
ignated under paragraph (1) with respect to 
any specified city shall not exceed the bond lim-
itation allocated to such city under subpara-
graph (B). 
‘‘(B) ALLOCATION.—The Secretary shall 
allocate bond limitation to each specified city 
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such that the bond limitation allocated to such 
city 
bears 
the 
same 
proportion 
to 
$1,000,000,000 as the population of such city 
(as determined for purposes of the 2010 cen-
sus) bears to the total population of all speci-
fied cities (as so determined).’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
for part III of subchapter Y of chapter 1 of such Code 
is amended by adding at the end the following new item: 
‘‘Sec. 1400U–4. Extension of recovery zone economic development bonds for 
certain cities.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to obligations issued after the date 
of the enactment of this Act. 
Æ 
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