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‘‘(2) QUALIFIED
GULF
OPPORTUNITY
ZONE 
BOND.—For purposes of this subsection, the term 
‘qualified Gulf Opportunity Zone Bond’ means any 
bond issued as part of an issue if— 
‘‘(A)(i) 95 percent or more of the net pro-
ceeds (as defined in section 150(a)(3)) of such 
issue are to be used for qualified project costs, 
or 
‘‘(ii) such issue meets the requirements of 
a qualified mortgage issue, except as otherwise 
provided in this subsection, 
‘‘(B) such bond is issued by the State of 
Alabama, Louisiana, or Mississippi, or any po-
litical subdivision thereof, 
‘‘(C) such bond is designated for purposes 
of this section by— 
‘‘(i) in the case of a bond which is re-
quired under State law to be approved by 
the bond commission of such State, such 
bond commission, and 
‘‘(ii) in the case of any other bond, 
the Governor of such State, and 
‘‘(D) such bond is issued after the date of 
the enactment of this section and before Janu-
ary 1, 2011.
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‘‘(3) LIMITATIONS ON BONDS.— 
‘‘(A) AGGREGATE AMOUNT DESIGNATED.— 
The maximum aggregate face amount of bonds 
which may be designated under this subsection 
with respect to any State shall not exceed the 
product of $2,500 multiplied by the portion of 
the State population which is in the Gulf Op-
portunity Zone (as determined on the basis of 
the most recent census estimate of resident 
population released by the Bureau of Census 
before August 28, 2005). 
‘‘(B) MOVABLE
PROPERTY.—No bonds 
shall be issued which are to be used for movable 
fixtures and equipment. 
‘‘(4) QUALIFIED
PROJECT
COSTS.—For pur-
poses of this subsection, the term ‘qualified project 
costs’ means the cost of acquisition, construction, re-
construction, and renovation of— 
‘‘(A) nonresidential real property and 
qualified residential rental property (as defined 
in section 142(d)) located in the Gulf Oppor-
tunity Zone, and 
‘‘(B) public utility property (as defined in 
section 168(i)(10)) located in the Gulf Oppor-
tunity Zone.
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‘‘(5) SPECIAL RULES.—In applying this title to 
any qualified Gulf Opportunity Zone Bond, the fol-
lowing modifications shall apply: 
‘‘(A) Section 142(d)(1) (defining qualified 
residential rental project) shall be applied— 
‘‘(i) by substituting ‘60 percent’ for 
‘50 percent’ in subparagraph (A) thereof, 
and 
‘‘(ii) by substituting ‘70 percent’ for 
‘60 percent’ in subparagraph (B) thereof. 
‘‘(B) Section 143 (relating to mortgage 
revenue bonds: qualified mortgage bond and 
qualified veterans’ mortgage bond) shall be ap-
plied— 
‘‘(i) by treating only residences in the 
Gulf Opportunity Zone as owner-occupied 
residences, 
‘‘(ii) by treating any residence in the 
Gulf Opportunity Zone as a targeted area 
residence, and 
‘‘(iii) by substituting ‘$150,000’ for 
‘$15,000’ in subsection (k)(4) thereof. 
‘‘(C) Except as provided in section 143, re-
payments of principal on financing provided by
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the issue of which such bond is a part may not 
be used to provide financing. 
‘‘(D) Section 146 (relating to volume cap) 
shall not apply. 
‘‘(E) Section 147(d)(2) (relating to acqui-
sition of existing property not permitted) shall 
be applied by substituting ‘50 percent’ for ‘15 
percent’ each place it appears. 
‘‘(F) Section 148(f)(4)(C) (relating to ex-
ception from rebate for certain proceeds to be 
used to finance construction expenditures) shall 
apply to the available construction proceeds of 
bonds which are part of an issue described in 
paragraph (2)(A)(i). 
‘‘(G) Section 57(a)(5) (relating to tax-ex-
empt interest) shall not apply. 
‘‘(6) SEPARATE
ISSUE
TREATMENT
OF
POR-
TIONS
OF
AN
ISSUE.—This subsection shall not 
apply to the portion of an issue which (if issued as 
a separate issue) would be treated as a qualified 
bond or as a bond that is not a private activity bond 
(determined without regard to paragraph (1)), if the 
issuer elects to so treat such portion. 
‘‘(b) ADVANCE REFUNDINGS OF CERTAIN TAX-EX-
EMPT BONDS.—