I 
110TH CONGRESS 
1ST SESSION H. R. 3896 
To facilitate efficient investments and financing of infrastructure projects 
and new job creation through the establishment of a National Infrastruc-
ture Development Corporation, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
OCTOBER 18, 2007 
Ms. DELAURO (for herself, Mr. WEINER, Mr. ISRAEL, Mr. HARE, and Mr. 
WELCH of Vermont) introduced the following bill; which was referred to 
the Committee on Transportation and Infrastructure, and in addition to 
the Committees on Financial Services and Ways and Means, for a period 
to be subsequently determined by the Speaker, in each case for consider-
ation of such provisions as fall within the jurisdiction of the committee 
concerned 
A BILL 
To facilitate efficient investments and financing of infrastruc-
ture projects and new job creation through the establish-
ment of a National Infrastructure Development Corpora-
tion, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘National Infrastruc-
ture Development Act of 2007’’. 
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SEC. 2. FINDINGS. 
Congress finds the following: 
(1) The underground steam pipe explosion in 
New York, New York on July 18, 2007, and the 
Interstate Route 35W Mississippi River Bridge col-
lapse in Minneapolis, Minnesota, on August 1, 2007, 
are both indicative of the major shortcomings in the 
national infrastructure. 
(2) According to the American Society of Civil 
Engineers, the condition of our nation’s roads, 
bridges, drinking water systems, and other public 
works are facing a shortfall of $1,600,000,000,000 
investment to bring conditions to acceptable levels. 
(3) According to the American Association of 
State Highway and Transportation Officials, high-
way vehicle miles traveled in the United States, 
which reached 3,000,000,000,000 in 2006, is ex-
pected to grow by 2.07 percent per year through 
2022 and may exceed 7,000,000,000,000 vehicle 
miles by 2055. 
(4) According to the American Public Transit 
Association, From 1995 through 2005, public trans-
portation ridership increased by 25 percent, a 
growth rate higher than the 11 percent increase in 
the United States population and higher than the 22 
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percent growth in use of the nation’s highways over 
the same period. 
(5) Airport capacity had increased only 1 per-
cent from 1991 to 2001, yet air traffic had in-
creased 35 percent during that same time period. 
(6) As of 2006, 25.8 percent of the nation’s 
bridges (154,101) were structurally deficient or 
functionally obsolete. 
(7) According to recent estimates by the Envi-
ronmental 
Protection 
Agency, 
as 
much 
as 
$390,000,000,000 will be needed over the next 2 
decades to rebuild, repair, and upgrade the Nation’s 
wastewater treatment plants. 
(8) According to the Texas Transportation In-
stitute, traffic congestion continues to worsen in 
American 
cities 
of 
all 
sizes, 
creating 
a 
$78,000,000,000 annual drain on the United States 
economy in lost productivity and wasted fuel. 
(9) Every billion dollars of Federal highway in-
vestment generates 47,500 jobs; and, for every bil-
lion dollars in transit investment, job generation is 
virtually the same as for highway investment. 
(10) 11,300,000 million Americans—one in 
11—are employed in transportation occupations. 
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(11) As expressed in Executive Order No. 
12893 of January 26, 1994, which sets out guiding 
principles for Federal infrastructure investments, a 
well functioning infrastructure is vital to sustained 
economic growth, to the quality of life of our com-
munities, and to the protection of our environment 
and natural resources. 
(12) Although grant programs of the Federal 
Government must continue to play a central role in 
financing the infrastructure needs of the Nation, 
current and foreseeable demands on existing Fed-
eral, State, and local funding for infrastructure ex-
pansion and replacement exceed the resources to 
support these programs by margins wide enough to 
prompt serious concerns about the Nation’s ability 
to sustain long-term economic development, produc-
tivity, and international competitiveness. 
(13) The private capital markets, including the 
trillions in capital held by institutional investors 
(such as pension funds), have a growing interest in 
public-private infrastructure investment opportuni-
ties that can produce competitive risk-adjusted rates 
of return. 
SEC. 3. PURPOSES. 
The purposes of this Act are as follows: 
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(1) To establish the National Infrastructure 
Development Corporation for the purpose of making 
new sources of financing available for the develop-
ment of infrastructure facilities, and to facilitate the 
use and issuance of public benefit bonds. 
(2) To establish a subsidiary of the Corpora-
tion, the National Infrastructure Insurance Corpora-
tion, to issue insurance, reinsurance and related un-
dertakings in respect of the issuance of obligations 
related to the development of infrastructure facili-
ties. 
(3) To establish a category of financial instru-
ment to be known as ‘‘public benefit bonds’’ de-
signed to help facilitate pension plan investment in 
the development of infrastructure facilities. 
SEC. 4. DEFINITIONS. 
The following definitions shall apply for purposes of 
this Act unless the context requires otherwise: 
(1) CORPORATION.—The term ‘‘Corporation’’ 
means the National Infrastructure Development 
Corporation established under section 5(a). 
(2) DEVELOPMENT.—The terms ‘‘development’’ 
and ‘‘develop’’ mean, with respect to an infrastruc-
ture facility, any— 
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(A) preconstruction planning, feasibility re-
view, permitting and design work and other 
preconstruction activities; 
(B) construction, reconstruction, rehabili-
tation, replacement, or expansion; and 
(C) operation and maintenance. 
(3) ENTITY.—The term ‘‘entity’’ means an in-
dividual, corporation, partnership, joint venture, 
trust or governmental entity or instrumentality. 
(4) INFRASTRUCTURE
FACILITY.—The term 
‘‘infrastructure facility’’ means a road, highway, 
bridge, tunnel, airport, mass transportation vehicle 
or system, passenger or freight rail vehicle or sys-
tem, intermodal transportation facility, waterway, 
commercial port, drinking or waste water treatment 
facility, solid waste disposal facility, pollution control 
system, hazardous waste facility, federally des-
ignated national information highway facility, school, 
and any ancillary facility which forms a part of any 
such facility or is reasonably related to such facility, 
whether owned, leased or operated by a public entity 
or a private entity or by a combination of such enti-
ties, and the financing or refinancing of the develop-
ment of which is, or will be, supported in whole or 
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in part by user fees or other dedicated revenue 
sources. 
(5) INSURANCE CORPORATION.—The term ‘‘In-
surance Corporation’’ means the National Infra-
structure Insurance Corporation established pursu-
ant to section 5(b). 
(6) NIC.—The term ‘‘NIC’’ means the Cor-
poration and all subsidiaries of the Corporation. 
(7) PENSION PLAN.—The term ‘‘pension plan’’ 
means a pension plan as defined in section 3(2) of 
the Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1001 et seq.), including any public 
pension plan. 
(8) PUBLIC BENEFIT BOND.—The term ‘‘public 
benefit bond’’ means a bond or other indebtedness 
meeting the requirements of section 72(x) of the In-
ternal Revenue Code of 1986. 
(9) PUBLIC-PRIVATE PARTNERSHIP.—The term 
‘‘public-private partnership’’ means any entity— 
(A) which is undertaking the development 
of all or part of any infrastructure facility— 
(i) pursuant to requirements estab-
lished in one or more contracts between 
such entity and a State or an instrumen-
tality of a State; or 
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(ii) the activities of which with respect 
to such facility are subject to regulation by 
a State or any instrumentality of a State; 
and 
(B) which owns, leases, or operates, or will 
own, lease, or operate, such infrastructure facil-
ity in whole or in part, and at least one of the 
participants in such entity is a nongovern-
mental entity. 
(10) REVOLVING FUND.—The term ‘‘revolving 
fund’’ means a fund or program established by a 
State or a political subdivision or instrumentality of 
a State, the principal activity of which is to make 
loans, commitments, or other financial accommoda-
tion available for the development of one or more 
categories of infrastructure facilities. 
(11) 
SECRETARY.—The 
term 
‘‘Secretary’’ 
means the Secretary of the Treasury or the designee 
of the Secretary. 
(12) STATE.—The term ‘‘State’’ includes the 
District of Columbia, Puerto Rico, Guam, American 
Samoa, the Virgin Islands, the Commonwealth of 
Northern Mariana Islands, and any other territory 
of the United States. 
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(13) TRANSITION DATE.—The term ‘‘transition 
date’’ means the date on which the voting common 
stock of the Corporation owned by the Secretary is 
fully repurchased or converted in accordance with 
section 13 and the transition of the Corporation to 
a government-sponsored enterprise in accordance 
with such section is completed. 
SEC. 5. ESTABLISHMENT OF NIC. 
(a) ESTABLISHMENT
OF NATIONAL INFRASTRUC-
TURE DEVELOPMENT CORPORATION.—The National In-
frastructure Development Corporation is established as a 
wholly owned Government corporation subject to chapter 
91 of title 31, United States Code (commonly known as 
the ‘‘Government Corporation Control Act’’), except as 
otherwise provided in this Act. 
(b) ESTABLISHMENT
OF NATIONAL INFRASTRUC-
TURE INSURANCE CORPORATION.—The National Infra-
structure Insurance Corporation is hereby established as 
a subsidiary of the Corporation and as a wholly owned 
Government corporation subject to chapter 91 of title 31, 
United States Code, except as otherwise provided in this 
Act. 
(c) SELF-SUPPORTING ENTITIES.—The Corporation 
and the Insurance Corporation shall each conduct their 
respective businesses as self-supporting entities. 
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SEC. 6. CORPORATION’S POWERS AND LIMITATIONS. 
(a) GENERAL POWERS.—In order to carry out the 
purposes of the Corporation as set forth in this Act, the 
Corporation shall have the following powers: 
(1) To make senior and subordinated loans and 
purchase senior and subordinated debt securities 
(both taxable and tax exempt) and equity securities, 
and enter into a binding commitment to make any 
such loan or purchase any such security, on such 
terms as the Corporation may determine, in the Cor-
poration’s discretion, to be appropriate, the proceeds 
of which are to be used to finance or refinance the 
development of one or more infrastructure facilities, 
and subject to the provisions of subsection (b)(8), 
provide preconstruction phase assistance in accord-
ance with section 8(f). 
(2) To issue and sell debt securities and voting 
and nonvoting equity securities of the Corporation 
on such terms as the board of directors of the Cor-
poration may determine, subject to the provisions of 
paragraphs (2), (3), and (4) of subsection (b), to be 
appropriate and to pay such dividends on any out-
standing stock as the board of directors shall deter-
mine from time to time. 
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(3) To make the determinations with respect to 
public benefit bonds pursuant to section 72(x) of the 
Internal Revenue Code of 1986. 
(4) To make agreements and contracts with any 
entity in furtherance of the business of the Corpora-
tion. 
(5) To make use of the services, facilities, and 
property of any Federal agency or instrumentality, 
with the approval of such agency or instrumentality 
and on a reimbursable basis, in carrying out the 
purposes of this Act. 
(6) To acquire, lease, pledge, exchange, and dis-
pose of real and personal property and otherwise ex-
ercise all the usual incidents of ownership of prop-
erty to the extent the exercise of such powers are ap-
propriate to and consistent with the purposes of the 
Corporation. 
(7) To sue and be sued in the Corporation’s 
corporate capacity in any court of competent juris-
diction, except that no attachment, injunction, or 
similar process, mesne or final, may be issued 
against the property of the Corporation or against 
the Corporation with respect to such property. 
(8) To indemnify the directors and officers of 
the Corporation for liabilities arising out of the ac-
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tions of the directors and officers in such capacity, 
in accordance with, and subject to the limitations 
contained in, the bylaws of the Corporation. 
(9) To exercise all other lawful powers which 
are necessary or appropriate to carry out, and are 
consistent with, the purposes of the Corporation, in-
cluding the powers conferred upon a corporation by 
the District of Columbia Business Corporation Act 
(sec. 29–101.01 et seq., D.C. Official Code). 
(b) LIMITATIONS ON THE CORPORATION.— 
(1) ACTIONS
CONSISTENT
WITH
SELF-SUP-
PORTING
ENTITY
STATUS.—The Corporation shall 
conduct its business in a manner consistent with the 
requirement of section 5(c). 
(2) CONDITION ON DEBT ISSUANCE.—The Cor-
poration shall not issue any debt security under sub-
section (a)(2) unless, at the time of the issuance 
thereof, such security is rated by a nationally recog-
nized statistical rating organization at one of the 3 
highest ratings of such organization. 
(3) LIMITATION AND CONDITION ON ISSUANCE 
OF DEBT AND NONVOTING EQUITY SECURITIES.— 
(A) IN
GENERAL.—Before the transition 
date, the Corporation shall not issue any debt 
security or nonvoting equity security under sub-
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significant proportion of the Corporation’s infra-
structure investments in— 
(A) subordinated securities; and 
(B) securities issued with respect to infra-
structure facilities developed by public-private 
partnerships. 
(7) COORDINATION
WITH
STATE
AND
LOCAL 
REGULATORY AUTHORITY.—The provision of finan-
cial assistance by the Corporation pursuant to this 
Act shall not be construed as— 
(A) limiting the right of any State or local 
authority to approve or regulate rates of return 
on private equity invested in a project; or 
(B) otherwise superseding any State law or 
regulation applicable to a project. 
(8) LIMITATION ON PRECONSTRUCTION ASSIST-
ANCE.—The Corporation shall provide assistance in 
connection with the development of any infrastruc-
ture facility during the facility’s preconstruction 
phase only in accordance with section 8(f). 
SEC. 7. INSURANCE CORPORATION’S POWERS AND LIMITA-
TIONS. 
(a) GENERAL POWERS.—In order to carry out the 
purposes of the Insurance Corporation as set forth in this 
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Act, the Insurance Corporation shall have the following 
powers: 
(1) To insure and reinsure bonds, debentures, 
notes, debt instruments, loans, and any interest in 
any such obligation or loan, the proceeds of which 
are to be used to finance or refinance the develop-
ment of 1 or more infrastructure facilities. 
(2) To insure leases of personal, real, or mixed 
property with respect to infrastructure facilities. 
(3) To issue letters of credit and undertake 
such obligations and commitments as the Insurance 
Corporation deems necessary to carry out the pur-
poses described in paragraphs (1) and (2). 
(4) To issue and sell voting and nonvoting eq-
uity securities on such terms as the board of direc-
tors of the Insurance Corporation may determine, 
subject to the provisions of paragraphs (5) and (6) 
of subsection (b), to be appropriate and to pay divi-
dends on any outstanding stock as the board of di-
rectors of the Insurance Corporation shall determine 
from time to time. 
(5) To make agreements and contracts with any 
entity in furtherance of the business of the Insur-
ance Corporation. 
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(6) To make use of the services, facilities, and 
property of any Federal agency or instrumentality, 
with the approval of such agency or instrumentality 
and on a reimbursable basis, in carrying out the 
purposes of this Act. 
(7) To acquire, lease, pledge, exchange, and dis-
pose of real and personal property and otherwise ex-
ercise all the usual incidents of ownership of prop-
erty to the extent the exercise of such powers are ap-
propriate to and consistent with the purposes of the 
Insurance Corporation. 
(8) To sue and be sued in the Insurance Cor-
poration’s corporate capacity in any court of com-
petent jurisdiction, except that no attachment, in-
junction, or similar process, mesne or final, may be 
issued against the property of the Insurance Cor-
poration or against the Insurance Corporation with 
respect to such property. 
(9) To indemnify the directors and officers of 
the Insurance Corporation for liabilities arising out 
of the actions of the directors and officers in such 
capacity, in accordance with, and subject to the limi-
tations contained in, the bylaws of the Insurance 
Corporation. 
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(10) To exercise all other lawful powers which 
are necessary or appropriate to carry out, and are 
consistent with, the purposes of the Insurance Cor-
poration, including the powers conferred upon a cor-
poration by the District of Columbia Business Cor-
poration Act (sec. 29–101.01 et seq., D.C. Official 
Code). 
(b) LIMITATIONS
ON
THE INSURANCE CORPORA-
TION.— 
(1) ACTIONS
CONSISTENT
WITH
SELF-SUP-
PORTING ENTITY STATUS.—The Insurance Corpora-
tion shall conduct its business in a manner con-
sistent with the requirement of section 5(c). 
(2) INSURANCE
CORPORATION
RATING
RE-
QUIREMENT.—The Insurance Corporation shall not 
issue any primary insurance or letter of credit with 
respect to one or more infrastructure facilities un-
less, at the time of such issuance, the Insurance 
Corporation’s claims-paying ability is then rated by 
a nationally recognized statistical rating organiza-
tion at the highest rating of such organization. 
(3) LIMITATION ON REINSURANCE.—The Insur-
ance Corporation may write reinsurance in respect 
of all or a portion of a primary insurance policy with 
respect to one or more infrastructure facilities issued 
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by a bond insurer if the claims-paying ability of such 
insurer is rated, at the time of issuance of such rein-
surance, by a nationally recognized statistical rating 
organization at the highest rating of such organiza-
tion. 
(4) LIMITATION ON INSURANCE AND OTHER AC-
TIVITIES.—The Insurance Corporation may issue 
primary insurance or a letter of credit with respect 
to one or more infrastructure facilities, except that 
not less than 75 percent of the principal amount of 
all obligations so insured or subject of a letter of 
credit shall be obligations which are, or based on a 
published or indicative rating would be, without such 
insurance or letter of credit, rated by a nationally 
recognized statistical rating organization in the 
fourth or fifth rating categories of such organization 
(BBB and BB; Baa and Ba, or their equivalents). 
(5) PRIOR
CONSENT
OF
SECRETARY.—Before 
the transition date, the Insurance Corporation shall 
not issue any nonvoting equity security under sub-
section (a)(4) without the prior consent of the Sec-
retary. 
(6) 
CONDITION
ON
VOTING
EQUITY 
ISSUANCE.—Before the transition date, the Insur-
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ance Corporation shall not issue any voting security 
to any entity other than the Corporation. 
(7) COORDINATION
WITH
STATE
AND
LOCAL 
REGULATORY AUTHORITY.—The provision of finan-
cial assistance by the Insurance Corporation pursu-
ant to this Act shall not be construed as— 
(A) limiting the right of any State or local 
authority to approve or regulate rates of return 
on private equity invested in a project; or 
(B) otherwise superseding any State law or 
regulation applicable to a project. 
SEC. 8. ELIGIBILITY CRITERIA FOR ASSISTANCE FROM THE 
CORPORATION AND THE INSURANCE COR-
PORATION. 
(a) GENERAL.—No financial assistance shall be avail-
able under this Act from the Corporation or the Insurance 
Corporation unless the applicant for such assistance has 
demonstrated to the satisfaction of the Corporation or the 
Insurance Corporation, as the case may be, that the 
project for which such assistance is being sought meets— 
(1) the requirements of this Act; and 
(2) any criteria established in accordance with 
this Act by the board of directors of the Corporation 
or the Insurance Corporation, as the case may be. 
(b) ESTABLISHMENT OF PROJECT CRITERIA.— 
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(1) IN GENERAL.—Consistent with the require-
ments of subsections (c) and (d), the boards of di-
rectors of the Corporation and the Insurance Cor-
poration shall each establish— 
(A) criteria for determining eligibility for 
financial assistance under this Act; 
(B) disclosure and application procedures 
to be followed by States, revolving funds, and 
other entities to nominate projects for assist-
ance under this Act; and 
(C) such other criteria as the board of di-
rectors of the Corporation or the Insurance 
Corporation may consider to be appropriate for 
purposes of carrying out this Act. 
(2) FACTORS TO BE TAKEN INTO ACCOUNT.— 
The criteria established pursuant to paragraph 
(1)(A) shall provide for the consideration of the fol-
lowing factors in considering eligibility for financial 
assistance under this Act: 
(A) The extent to which provision of assist-
ance by the Corporation or the Insurance Cor-
poration will further the objectives for infra-
structure investments established in Executive 
Order No. 12893 of January 26, 1994, includ-
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ing the stated objective of providing opportuni-
ties for ‘‘innovative public-private initiatives’’. 
(B) The means by which development of 
the infrastructure facility under consideration is 
being financed, including— 
(i) the terms and conditions and fi-
nancial structure of the proposed financ-
ing; 
(ii) the financial assumptions and pro-
jections on which the project is based; and 
(iii) based on consideration of clauses 
(i) and (ii), whether the infrastructure fa-
cility will have the capacity to be self-sup-
porting. 
(C) The likelihood that the provision of as-
sistance by the Corporation or the Insurance 
Corporation will cause such development to pro-
ceed more promptly and with lower costs for fi-
nancing to the public and private entities en-
gaged in developing such infrastructure facility 
than would be the case without such assistance. 
(D) The extent to which the provision of 
assistance by the Corporation or the Insurance 
Corporation maximizes the level of private in-
vestment in such infrastructure facility. 
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(3) LIMITATION
ON
CONDITIONS.—The Cor-
poration and the Insurance Corporation shall not 
condition the approval of financial assistance for the 
development of any infrastructure facility on a re-
quirement that a pension plan of a State or political 
subdivision of a State make an investment in such 
facility. 
(c) SUBMISSION OF PROJECT PROPOSALS.— 
(1) ACCEPTANCE
OF
PROPOSALS.—The Cor-
poration and the Insurance Corporation shall accept, 
for consideration, project proposals relating to the 
development of infrastructure facilities submitted by 
a State, a revolving fund, or another entity, subject 
to subsection (d), which meet the requirements of 
subsection (b). 
(2) LIST OF PROJECTS UNDER CONSIDERATION 
FOR ASSISTANCE.—Project proposals accepted pur-
suant to paragraph (1) and approved in principle 
shall be placed on a list of projects being considered 
for financial assistance under this Act. 
(3) ELIGIBILITY
FOR
PRECONSTRUCTION
AS-
SISTANCE.—Projects on the list established pursuant 
to paragraph (2) shall be eligible to apply for 
preconstruction assistance in accordance with sub-
section (f). 
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(4) 
SUBSEQUENT
APPROVALS.—Notwith-
standing the receipt of any preconstruction assist-
ance for any project, no additional financial assist-
ance under this Act for such project may be pro-
vided without the specific approval by the Corpora-
tion or the Insurance Corporation, as the case may 
be, for such additional assistance. 
(5) FEES.—A fee may be charged for the re-
view of any project proposal in such amount as may 
be deemed appropriate by the Corporation or the In-
surance Corporation to cover the cost of such review. 
(d) STATE ELIGIBILITY.— 
(1) IN GENERAL.—After the end of the 3-year 
period beginning on the date of the enactment of 
this Act, no financial assistance may be provided by 
the Corporation or the Insurance Corporation for 
the development of any infrastructure facility pro-
posed for assistance by a State, or a revolving fund 
in a State, unless such State has in place— 
(A) an evaluation process which is certified 
by the Secretary, in accordance with regulations 
which the Secretary shall prescribe before the 
end of the 6-month period beginning on such 
date of enactment, as being designed to ascer-
tain the extent to which major work with re-
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spect to infrastructure facilities within the 
State can be financed by relying on any revenue 
reasonably obtainable from such facilities and 
other dedicated revenue sources; and 
(B) a program which is certified by the 
Secretary, in accordance with regulations which 
the Secretary shall prescribe before the end of 
such 6-month period, as being reasonably de-
signed to promote the objective set forth in Ex-
ecutive Order No. 12893 of January 26, 1994, 
of affording the opportunity for innovative pub-
lic-private initiatives with respect to major 
work, consistent with the public interest. 
(2) ACTIVITIES WITH NONSTATE ENTITIES.— 
After the end of the 3-year period beginning on the 
date of the enactment of this Act, the Corporation 
and the Insurance Corporation each may continue to 
undertake activities with respect to projects within a 
State relating to the development of infrastructure 
facilities which have been submitted by entities other 
than such State or a revolving fund in such State, 
including municipalities, regional authorities, and 
private-public partnerships, if the infrastructure fa-
cilities meet the criteria for assistance established 
pursuant to subsection (b), and the State or States 
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in which such facility or facilities are to be located 
have not met the conditions of subsection (d)(1). 
(3) MAJOR WORK DEFINED.—For purposes of 
paragraph (1), the term ‘‘major work’’ means the 
construction of a new infrastructure facility, or the 
reconstruction, rehabilitation, replacement, or expan-
sion of an existing infrastructure facility, involving 
the expenditure of more than $10,000,000. 
(e) 
INITIAL
TARGETING
OF
READY-TO-GO 
PROJECTS.—During the 3-year period beginning on the 
date of the enactment of this Act, the Corporation and 
the Insurance Corporation shall each seek to provide as-
sistance to projects involving the development of infra-
structure facilities which— 
(1) the Corporation or the Insurance Corpora-
tion, as the case may be, determines are ready to 
move forward promptly; and 
(2) meet all other requirements of this Act. 
(f) DEVELOPMENT RISK INSURANCE.— 
(1) IN GENERAL.—Any project on the list es-
tablished pursuant to subsection (c)(2) shall be eligi-
ble to apply to the Corporation for development risk 
insurance in accordance with this subsection to in-
sure against the risk of loss that would result if a 
project does not proceed within a specified time 
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frame as the result of the failure to secure relevant 
permits or specified Federal, State, or local approv-
als. 
(2) TERMS AND SCOPE OF COVERAGE.—Devel-
opment risk insurance provided under this sub-
section shall— 
(A) contain such limitations, deductibles, 
exclusions, and exceptions as the Corporation 
shall establish; and 
(B) apply only to developmental costs in-
curred after the date of the approval of the ap-
plication for such insurance. 
(3) 
MAXIMUM
ON
INSURANCE
OF 
PRECONSTRUCTION
RISK.—The Corporation shall 
not 
insure 
more 
than 
percent 
of 
the 
preconstruction phase development risk of any 
project, as determined by the Corporation. 
(4) ADDITIONAL
CONDITIONS.—The Corpora-
tion may impose such other conditions and require-
ments in connection with any insurance provided 
under this subsection as the Corporation may deter-
mine to be appropriate, including requirements for 
audits of costs and other matters. 
(5) FEES FOR INSURANCE.—The Corporation 
may charge such fees and obtain such other com-
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pensation for providing insurance coverage under 
this subsection as the Corporation, in the Corpora-
tion’s discretion, shall determine to be appropriate. 
(6) MAXIMUM EXPOSURE OF CORPORATION.— 
The total outstanding exposure of the Corporation 
with respect to insurance provided under this sub-
section may not exceed the amount which is equal to 
5 percent of the sum of the capital, surplus, and re-
tained earnings of the Corporation, as measured at 
the time any such insurance is provided. 
(g) DISCRETION OF CORPORATION AND INSURANCE 
CORPORATION.—Consistent with other provisions of this 
Act, any determination of the Corporation or the Insur-
ance Corporation to provide assistance to any project, and 
the manner in which such assistance is provided, including 
the terms, conditions, fees and charges in respect thereof, 
shall be at the sole discretion of the Corporation or the 
Insurance Corporation, as the case may be. 
(h) INDEPENDENT INVESTMENT COMMITTEE.—Any 
final decision to provide or not provide assistance under 
this Act by the Corporation or the Insurance Corporation 
with respect to any specific proposal shall be made by an 
investment committee, of the respective corporation, which 
shall be comprised of senior officers of the Corporation 
and the Insurance Corporation, as the case may be, ap-
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pointed to such committee by the respective board of direc-
tors, which committees shall not have any nonofficer direc-
tor members. 
(i) STATE AND LOCAL PERMITS REQUIRED.—The 
provision of assistance by the Corporation or the Insur-
ance Corporation in accordance with this section shall not 
be deemed to relieve any recipient of assistance or the re-
lated project of any obligation to obtain required State and 
local permits and approvals. 
(j) ANNUAL REPORT.—A State, revolving fund, or 
other entity receiving assistance from the Corporation or 
the Insurance Corporation shall make annual reports to 
the Corporation or the Insurance Corporation, as the case 
may be, on the use of any such assistance, compliance with 
the criteria set forth in this section, and a disclosure of 
all entities with a development, ownership, or operational 
interest in a project assisted or proposed to be assisted 
pursuant to this Act. 
(k) COOPERATION.—While the Corporation and In-
surance Corporation each has sole discretion, the Corpora-
tion and Insurance Corporation shall cooperate with State, 
local, and regional officials. 
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SEC. 9. CAPITALIZATION AND ORGANIZATION OF THE COR-
PORATION AND THE INSURANCE CORPORA-
TION. 
(a) CAPITALIZATION.— 
(1) CAPITALIZATION OF THE CORPORATION.— 
(A) VOTING
COMMON
STOCK.—Effective 
for any fiscal year only to such extent and in 
such amounts as are provided in advance in ap-
propriation Acts, the Secretary shall subscribe 
for and purchase, in each of the 3 years fol-
lowing the date of enactment of this Act, voting 
common stock of the Corporation having an ag-
gregate purchase price in each year of 
$3,000,000,000, except that no such purchase 
shall occur after the transition date. 
(B) LIMITATION ON SALE OF SECURITIES 
BY
SECRETARY.—Securities purchased by the 
Secretary may not be sold or otherwise trans-
ferred by the Secretary unless such sale or 
transfer is effected pursuant to section 13 or is 
explicitly authorized by an Act of Congress. 
(2) CAPITALIZATION OF THE INSURANCE COR-
PORATION.— 
(A) IN GENERAL.—The Corporation may 
subscribe for and purchase voting common 
stock of the Insurance Corporation in such 
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amounts and at such times as the board of di-
rectors of the Corporation shall from time to 
time consider appropriate. 
(B) LIMITATION ON INVESTMENT BY COR-
PORATION.—Not more than 25 percent of the 
capital, surplus, and retained earnings of the 
Corporation may be invested by the Corporation 
in the Insurance Corporation without the con-
sent of the Secretary, measured at the time of 
any such investment. 
(3) REPURCHASE
OF
OUTSTANDING
OBLIGA-
TIONS.—The Corporation and the Insurance Cor-
poration may purchase in the open market any of 
their respective outstanding obligations at any time 
and at any price. 
(b) PLACE OF BUSINESS AND GOVERNING LAW.— 
(1) CORPORATION.— 
(A) PRINCIPAL OFFICE.—The Corporation 
shall maintain its principal office in the District 
of Columbia, and shall be deemed, for purposes 
of venue in civil actions, to be a resident of the 
District of Columbia. 
(B) APPLICABILITY OF DISTRICT OF CO-
LUMBIA BUSINESS CORPORATION ACT.—To the 
extent not inconsistent with this Act, the Cor-
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poration shall be subject to the District of Co-
lumbia Business Corporation Act (sec. 29– 
101.01 et seq., D.C. Official Code). 
(2) INSURANCE CORPORATION.— 
(A) PLACE OF BUSINESS.—The Insurance 
Corporation shall maintain its principal office 
in the District of Columbia, and shall be 
deemed, for purposes of venue in civil actions, 
to be a resident thereof. 
(B) APPLICABILITY OF DISTRICT OF CO-
LUMBIA BUSINESS CORPORATION ACT.—To the 
extent not inconsistent with this Act, the Insur-
ance Corporation shall be subject to the District 
of Columbia Business Corporation Act. 
(3) APPLICABILITY
OF
STATE
INSURANCE 
LAWS.—Before the transition date, the Corporation 
and the Insurance Corporation shall not be subject 
to the provisions of the law of any State or political 
subdivision of any State regulating the ownership or 
conduct of an insurance or surety business in any 
jurisdiction. 
(4) EXEMPTION FROM TAXATION.— 
(A) ON AND BEFORE TRANSITION DATE.— 
On and before the transition date, the Corpora-
tion, the Insurance Corporation, and any other 
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subsidiary of the Corporation, including the 
franchise, capital, reserves, surplus, securities 
holdings, and income of the Corporation, the 
Insurance Corporation, or any such subsidiary 
shall be exempt from taxation now or hereafter 
imposed by the United States, any State, or 
any county, municipality, or local taxing au-
thority. 
(B) AFTER TRANSITION DATE.—After the 
transition date, the Corporation, the Insurance 
Corporation, and any other subsidiary of the 
Corporation, including the franchise, capital, re-
serves, surplus, securities holdings, and income 
of the Corporation, the Insurance Corporation, 
or any such subsidiary shall be exempt from all 
taxation now or hereafter imposed by the 
United States, any State, or any county, mu-
nicipality, or local taxing authority in any 
State, provided that the Corporation, the Insur-
ance Corporation and any other subsidiary of 
the Corporation shall be subject to Federal in-
come taxation. 
SEC. 10. MANAGEMENT OF THE CORPORATION. 
(a) BOARD OF DIRECTORS.— 
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(1) NUMBER AND APPOINTMENT.—Subject to 
the provisions of section 13, the Corporation shall 
have a board of directors consisting of 12 members, 
9 of whom shall be appointed by the President. 
(2) REQUIRED
EXPERTISE.—The President 
shall appoint individuals to the board of directors of 
the Corporation with a demonstrated experience and 
expertise in the general field of infrastructure 
project development, finance, or related disciplines. 
(3) ADDITIONAL
SELECTION
CRITERIA.—The 
President shall ensure that, of the nonofficer direc-
tors appointed to the board of directors, a minimum 
of 6 shall be selected from among representatives of 
the private sector, of which— 
(A) 2 shall be representatives of organized 
labor; and 
(B) 2 shall be individuals involved in the 
field of public-private infrastructure finance and 
related disciplines. 
(4) CONSULTATION WITH THE NATIONAL GOV-
ERNORS’ CONFERENCE.—The President shall select 
2 of the nonofficer directors to be appointed to the 
board of directors after consulting with and consid-
ering the recommendations of the National Gov-
ernors’ Conference. 
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(5) APPOINTMENT
OF
OFFICERS
TO
THE 
BOARD.—A majority of the nonofficer members of 
the board shall appoint the president of the Corpora-
tion who shall serve on the board of directors. The 
president of the Corporation shall select 2 executive 
officers to be appointed to the board, subject to con-
firmation by a majority of the board. 
(6) TERMS.— 
(A) PRESIDENTIAL
APPOINTEES.—Each 
director appointed by the President shall be ap-
pointed for a term of 4 years, except as pro-
vided in subparagraph (B). 
(B) 
INITIAL
PRESIDENTIAL
AP-
POINTEES.—As designated by the President, of 
the directors first appointed by the President— 
(i) 1⁄3 shall be appointed for a term of 
2 years; 
(ii) 1⁄3 shall be appointed for a term 
of 3 years; and 
(iii) 1⁄3 shall be appointed for a term 
of 4 years. 
(C) OFFICER
DIRECTORS.—Officer direc-
tors of the Corporation shall serve for a period 
of one year or until they cease to be an officer 
of the Corporation. 
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(D) INTERIM APPOINTMENTS.—Any direc-
tor appointed to fill a vacancy occurring before 
the expiration of the term for which the direc-
tor’s predecessor was appointed shall be ap-
pointed only for the remainder of that term. 
(E) CONTINUATION OF SERVICE.—A direc-
tor may serve after the expiration of that direc-
tor’s term until a successor has taken office. 
(7) VACANCIES.—A vacancy in the board of di-
rectors shall be filled in the manner in which the 
original appointment was made. 
(8) REAPPOINTMENT.— 
(A) PRESIDENTIAL
APPOINTEES.—Mem-
bers of the board of directors appointed by the 
President may be reappointed by the President, 
consistent with the requirements of this section. 
(B) OFFICER DIRECTORS.—The president 
of the Corporation shall be reappointed to the 
board by the nonofficer directors for so long as 
such individual continues to serve as president 
of the Corporation. Officer directors of the 
board selected by the president of the Corpora-
tion may be reappointed by the president of the 
Corporation, consistent with the requirements 
of this section. 
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(9) REMOVAL.— 
(A) PRESIDENTIAL APPOINTEES.—A direc-
tor appointed by the President shall be subject 
to removal only for cause. 
(B) OFFICER
DIRECTORS.—Officer direc-
tors of the Corporation shall be subject to re-
moval from the board in the discretion of a ma-
jority of the board, except that the president of 
the Corporation shall continue to serve on the 
board for so long as he or she serves as presi-
dent of the Corporation. 
(10) QUORUM.—Seven directors shall constitute 
a quorum. 
(11) CHAIRPERSON.—The chairperson of the 
board of directors shall be selected by a majority of 
the board from among the nonofficer directors of the 
board, and shall serve for a period of one year, or 
until a new chairperson is selected. 
(12) STATUS AND COMPENSATION OF BOARD 
MEMBERS.— 
(A) NONOFFICER
DIRECTORS.—Members 
of the board of directors who are not officers of 
the Corporation shall serve on a part-time basis 
and shall receive a per diem, when engaged in 
the actual performance of Corporation business, 
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plus reasonable reimbursement for travel, sub-
sistence and other necessary expenses incurred 
in the performance of their duties. 
(B) OFFICER
DIRECTORS.—Members of 
the board of directors who are officers of the 
Corporation shall not be entitled to receive any 
salary or other compensation for services as a 
director of the Corporation, but may receive 
reasonable reimbursement for travel, subsist-
ence and other necessary expenses incurred in 
the performance of their duties as directors of 
the Corporation. 
(13) CONFLICTS OF INTEREST.— 
(A) IN
GENERAL.—Nonofficer directors 
shall have no responsibility for, and shall not 
seek to influence, any decision of the inde-
pendent investment committee established pur-
suant to section 8(h). 
(B) 
CONSULTATION.—Notwithstanding 
subparagraph (A), the investment committee 
may, in the committee’s discretion and on the 
committee’s own initiative, consult with the 
board of directors as the committee sees fit. 
(C) LIMITATION ON CONSULTATION.—No 
nonofficer director of the Corporation who has, 
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or is affiliated with a person who has, an inter-
est in any project under consideration for as-
sistance under this Act shall participate in any 
consultation under subparagraph (B) with re-
spect to such project. 
(14) MEETINGS.—The board of directors shall 
meet at any time pursuant to the call of the chair-
person or a majority of the directors and as provided 
by the bylaws of the Corporation, but not less than 
once each calendar quarter. 
(15) DUTIES.—In addition to any duties estab-
lished under this Act and the bylaws of the Corpora-
tion, the board of directors shall determine the gen-
eral policies which shall govern the operations of the 
Corporation in accordance with this Act. 
(16) DELEGATION OF AUTHORITY.—The board 
of directors may delegate duties and powers of the 
board to such committees of the board as the board 
may determine to be appropriate. 
(b) OFFICERS OF THE CORPORATION.— 
(1) PRESIDENT
OF
THE
CORPORATION.—The 
president of the Corporation shall be the chief execu-
tive officer of the Corporation, with such executive 
functions, powers, and duties as may be prescribed 
by this Act, the bylaws, or the board of directors. 
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(2) APPOINTMENT OF OFFICERS.—The presi-
dent of the Corporation shall, with the approval of 
a majority of the board, appoint qualified individuals 
to such executive officer positions as may be pro-
vided for in the bylaws of the Corporation, and shall 
define their duties. The president may appoint, re-
move, fix the compensation of, and define the duties 
of other officers as provided in the bylaws. 
(3) COMPENSATION.—The compensation of the 
president and the executive officers of the Corpora-
tion shall be determined by the board of directors of 
the Corporation, in the discretion of the board of di-
rectors. 
(4) CONFLICTS OF INTEREST.—Officers of the 
Corporation shall not participate in any review or 
decision affecting a project under consideration for 
assistance under this Act if such officer has, or is 
affiliated with a person who has, an interest in such 
project. 
(5) REMOVAL.—Any executive officer of the 
Corporation may be removed in the discretion of a 
majority of the board of directors. 
SEC. 11. MANAGEMENT OF THE INSURANCE CORPORATION. 
(a) BOARD OF DIRECTORS.— 
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(1) NUMBER AND ELECTION.—Subject to the 
provisions of section 13, the Insurance Corporation 
shall have a board of directors consisting of 12 
members elected by the stockholders of the Insur-
ance Corporation. 
(2) INITIAL
APPOINTMENT
OF
DIRECTORS.— 
The initial directors of the Insurance Corporation 
shall be appointed by the board of directors of the 
Corporation. 
(3) REQUIRED EXPERTISE.—The board shall be 
comprised of individuals who have a demonstrated 
expertise and experience in the field of credit en-
hancement or insurance and related disciplines, a 
minimum of 9 of whom shall be selected from among 
representatives of the private sector. 
(4) TERMS.— 
(A) IN GENERAL.—Each director shall be 
elected or appointed for a term of 2 years, ex-
cept as provided in subparagraph (B). 
(B) INTERIM APPOINTMENTS.—Any direc-
tor elected or appointed to fill a vacancy occur-
ring before the expiration of the term for which 
the director’s predecessor was appointed shall 
be elected or appointed only for the remainder 
of that term. 
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(C) CONTINUATION OF SERVICE.—A direc-
tor may serve after the expiration of that direc-
tor’s term until a successor has taken office. 
(5) VACANCIES.—A vacancy in the board of di-
rectors shall be filled in the manner in which the 
original appointment was made, except that the by-
laws may provide for the appointment by the board 
of directors of a director to fill a vacancy occurring 
before the expiration of the term for which the direc-
tor’s predecessor was elected or appointed. 
(6) QUORUM.—Seven directors shall constitute 
a quorum. 
(7) CHAIRPERSON.— 
(A) ELECTION.—The chairperson of the 
board of directors shall be elected by the board 
of directors from among the directors on the 
board. 
(B) TERM.—The term of office of the 
chairperson shall be one year or until a new 
chairperson is elected. 
(8) STATUS
AND
COMPENSATION
OF
BOARD 
MEMBERS.—Members of the board of directors shall 
serve on a part-time basis and shall receive a per 
diem, when engaged in the actual performance of In-
surance Corporation business, plus reasonable reim-
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bursement for travel, subsistence and other nec-
essary expenses incurred in the performance of their 
duties. 
(9) CONFLICTS OF INTEREST.— 
(A) IN
GENERAL.—Nonofficer directors 
shall have no responsibility for, and shall not 
seek to influence, any decision of the inde-
pendent investment committee established pur-
suant to section 8(h). 
(B) 
CONSULTATION.—Notwithstanding 
subparagraph (A), the investment committee 
may, in the committee’s discretion and on the 
committee’s own initiative, consult with the 
board of directors as the committee sees fit. 
(C) LIMITATION ON CONSULTATION.—No 
director who has, or is affiliated with any per-
son who has, an interest in any project under 
consideration for assistance under this Act shall 
participate in any such consultation with re-
spect to such project. 
(10) MEETINGS.—The board of directors shall 
meet at any time pursuant to the call of the chair-
person or a majority of the directors and as provided 
by the bylaws of the Insurance Corporation, but not 
less than once each calendar quarter. 
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(11) DUTIES.—In addition to any duties estab-
lished under this Act or the bylaws of the Insurance 
Corporation, the board of directors shall determine 
the general policies which shall govern the oper-
ations of the Insurance Corporation in accordance 
with this Act. 
(12) DELEGATION OF AUTHORITY.—The board 
of directors may delegate duties and powers of the 
board to such committees of the board as the board 
may determine to be appropriate. 
(b) OFFICERS OF THE INSURANCE CORPORATION.— 
(1) PRESIDENT OF THE INSURANCE CORPORA-
TION.—There shall be a position of president of the 
Insurance Corporation who shall be the chief execu-
tive officer of the Insurance Corporation, with such 
executive functions, powers, and duties as may be 
prescribed by the bylaws or by the board of direc-
tors. 
(2) APPOINTMENT OF OFFICERS.—The chair-
person of the board of directors of the Insurance 
Corporation shall, with the approval of a majority of 
the board, appoint a qualified individual to the posi-
tion of president of the Insurance Corporation. The 
president of the Insurance Corporation shall, with 
the approval of a majority of the board, appoint 
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qualified individuals to such executive officer posi-
tions as may be provided for in the bylaws of the In-
surance Corporation, and shall define their duties. 
The president may appoint, remove, fix the com-
pensation of, and define the duties of other officers 
as provided in the bylaws. 
(3) COMPENSATION.—The compensation of the 
president and the executive officers of the Insurance 
Corporation shall be determined by the board of di-
rectors of the Insurance Corporation, in the discre-
tion of the board of directors. 
(4) CONFLICTS OF INTEREST.—Officers of the 
Insurance Corporation shall not participate in any 
review or decision affecting a project under consider-
ation for assistance under this Act if such officer 
has, or is affiliated with a person who has, an inter-
est in such project. 
(5) REMOVAL.—Any executive officer of the In-
surance Corporation may be removed in the discre-
tion of a majority of the board of directors. 
SEC. 12. BOARD OF DIRECTOR MEETINGS OPEN TO PUBLIC. 
(a) GENERAL.—All meetings of the full board of di-
rectors held to conduct the business of the Corporation 
or the Insurance Corporation shall be open to the public, 
and shall be preceded by reasonable notice. 
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(b) CLOSED MEETINGS.—Pursuant to such rules as 
the Corporation and the Insurance Corporation may es-
tablish through their bylaws, the respective board of direc-
tors may close a meeting of the board if at the meeting 
there is likely to be disclosed information which could ad-
versely affect or lead to speculation relating to an infra-
structure project under consideration for assistance under 
this Act, or in financial or securities or commodities mar-
kets or institutions, utilities, or real estate. The deter-
mination to close any meeting of either board of directors 
shall be made in a meeting of such board, open to the 
public, and preceded by reasonable notice. The respective 
board of directors shall prepare minutes of any meeting 
which is closed to the public and make such minutes avail-
able as soon as the considerations necessitating closing 
such meeting no longer apply. 
SEC. 13. TRANSITION TO GOVERNMENT-SPONSORED EN-
TERPRISE. 
(a) GENERAL.—Within 5 years after the date of the 
enactment of this Act, the Corporation shall prepare a 
strategic plan for the transition of NIC to a government- 
sponsored enterprise (as defined in section 3(8) of the 
Congressional Budget and Impoundment Control Act of 
1974 (2 U.S.C. 622(8)) and for the sale or transfer to 
investors other than the Federal Government, as set forth 
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in subsection (b), of the voting securities of the Corpora-
tion. The Corporation shall revise such transition plan as 
needed. 
(b) PLAN; PENSION PLAN PARTICIPATION.— 
(1) IN GENERAL.—The strategic plan shall in-
clude consideration of alternative means for effecting 
such transition through a broad distribution to long- 
term investors, including by a public offering of 
stock or convertible stock or debt. 
(2) PENSION PLAN PARTICIPATION.—The stra-
tegic plan shall include provisions that specify that 
the initial purchasers of voting securities of the Cor-
poration or of nonvoting securities which are con-
vertible to such voting securities on the transition 
date (disregarding any underwriters of such securi-
ties) shall be pension plans. 
(c) MEANS OF TRANSFER.— 
(1) IN GENERAL.—The strategic plan may call 
for a phased transfer of ownership or for complete 
transfer at a single point in time. 
(2) RULES
APPLICABLE
IN
THE
CASE
OF
A 
PHASED TRANSITION.—If the plan calls for phased 
transfer of ownership— 
(A) such transition shall be deemed to 
occur when 100 percent of the voting securities 
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of the Corporation have been transferred to or 
are held by investors other than the Federal 
Government, and the investment of the Federal 
Government in the Corporation has been repaid 
or converted as provided in subsection (h); 
(B) before the transition date, all equity 
securities of the Corporation held by investors 
other than the Federal Government (or any eq-
uity security into which any other security is 
convertible) shall be nonvoting securities; and 
(C) on and after the transition date, non-
voting equity securities of the Corporation held 
by investors other than the Federal Government 
(or into which other securities are convertible) 
may, in accordance with the terms of such secu-
rities, be converted or become convertible into 
voting securities. 
(d) REQUIREMENT OF PRESIDENTIAL APPROVAL.— 
The Corporation may not implement the transition plan 
without the approval of the President, and shall seek re-
approval if the plan is materially altered. 
(e) NOTIFICATION OF CONGRESS.— 
(1) IN GENERAL.—The Corporation shall notify 
the Congress of— 
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(A) the Corporation’s intent to implement 
the transition plan; and 
(B) any material alteration of a transition 
plan previously submitted to the Congress. 
(2) REPORT.—Within 30 days of any notifica-
tion of the Congress under paragraph (1), the 
Comptroller General of the United States shall sub-
mit a report to Congress evaluating the extent to 
which— 
(A) the transition plan (as then modified) 
would result in ongoing obligations (other than 
contemplated by subsection (h)) or undue cost 
to the Federal Government; and 
(B) the cash proceeds (or projected range 
thereof) to be provided to the Federal Govern-
ment, or the securities proposed to be received 
in exchange for the investment of the Federal 
Government in the Corporation or portion 
thereof, represents the full recoupment of such 
investment (after taking into account any divi-
dends paid to the Federal Government). 
(f) CONGRESSIONAL REVIEW.—The Corporation may 
implement the plan not less than 60 days after notification 
of the Congress, if the approval of the President referred 
to in subsection (d) has been received. 
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(g) DEPOSIT OF PROCEEDS.—Any cash proceeds re-
ceivable by the Federal Government pursuant to this sec-
tion shall be deposited in the general fund of the Treasury. 
(h) CONVERSION
OF FEDERAL GOVERNMENT IN-
VESTMENT.—Upon the implementation of the transition 
plan, the voting equity securities of the Corporation held 
by the Federal Government or, in the case of a phased 
transition, that portion of the voting equity securities 
which are subject to such phase shall be repurchased by 
the Corporation or converted to long-term subordinated 
debt securities having a par amount not less than the 
amounts appropriated pursuant to section 19 and subject 
to such phase, or a combination thereof, as contemplated 
by such plan. 
(i) BOARD OF DIRECTORS.— 
(1) CORPORATION.— 
(A) INITIAL
BOARD.—Before the end of 
the 120-day period beginning on the transition 
date, a special meeting of the stockholders of 
the Corporation shall be held, at which all di-
rectors of the Corporation shall be elected to 
serve a one-year term or until any such direc-
tor’s successor has been elected. 
(B) NOMINATION; SELECTION CRITERIA.— 
The candidates for election to the board of di-
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rectors under paragraph (1) shall be nominated 
by the existing board of directors and 4 of such 
candidates shall be nominated in accordance 
with the selection criteria set out in section 
10(a)(3). 
(C) SUBSEQUENT BOARDS.—After the 1st 
election of a board of directors pursuant to sub-
paragraph (A), the directors shall be elected 
and subject to removal by the stockholders of 
the Corporation, as provided in the District of 
Columbia Business Corporation Act, except that 
the nomination of candidates for each election 
of the board of directors shall continue to re-
flect the requirements of section 10(a)(3). 
(2) INSURANCE CORPORATION.— 
(A) INITIAL
BOARD.—Promptly following 
the special meeting of the stockholders of the 
Corporation pursuant to paragraph (1), a spe-
cial meeting of the stockholders of the Insur-
ance Corporation shall be held, at which all di-
rectors or the Insurance Corporation shall be 
elected to serve a one-year term or until any 
such director’s successor has been elected. 
(B) SUBSEQUENT BOARDS.—After the first 
election of a board of directors pursuant to sub-
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paragraph (A), the directors shall be elected 
and subject to removal by the stockholders of 
the Insurance Corporation, as provided in the 
District of Columbia Business Corporation Act 
(sec. 29–101.01 et seq., D.C. Official Code). 
(j) TRANSMITTAL OF FINAL PLAN AFTER COMPLE-
TION.—The Corporation shall transmit copies of the final 
strategic plan for transition to the President and the Con-
gress upon completion of such transition. 
SEC. 14. STATUS AND APPLICABILITY OF CERTAIN FED-
ERAL LAWS. 
(a) BEFORE THE TRANSITION DATE.—Before the 
transition date, the Corporation, the Insurance Corpora-
tion, and any other subsidiary of the Corporation, shall— 
(1) not be agencies of the United States; and 
(2) comply with all Federal laws regulating the 
budgetary and auditing practices of a government 
corporation, except as otherwise provided in this Act. 
(b) SUBSEQUENT TO THE TRANSITION DATE.—On 
and after the transition date, the Corporation, the Insur-
ance Corporation, and any other subsidiary of the Cor-
poration shall not be considered to be an agency, instru-
mentality, or establishment of the United States Govern-
ment or a government corporation or a government-con-
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of section 14 of the Federal Reserve Act and section 
3124 of title 31, United States Code. 
(3) NO PRIORITY AS A FEDERAL CLAIM.—The 
priority established in favor of the United States by 
section 3713 of title 31, United States Code, shall 
not apply with respect to any indebtedness of the 
Corporation or the Insurance Corporation. 
(e) FEDERAL RESERVE BANKS AS DEPOSITORIES, 
CUSTODIANS, AND FISCAL AGENTS.—The Federal reserve 
banks may act as depositories for, or custodians or fiscal 
agents of, the Corporation and the Insurance Corporation. 
(f) ACCESS
TO BOOK-ENTRY SYSTEM.—The Sec-
retary may authorize the Corporation and the Insurance 
Corporation to use the book-entry system of the Federal 
reserve system. 
SEC. 15. COMPLIANCE WITH DAVIS-BACON ACT. 
NIC shall take such action as may be necessary to 
ensure that projects assisted in whole or in part under 
the provisions of this Act shall incorporate a provision re-
quiring in any contract relating to any construction, recon-
struction, rehabilitation, replacement, or expansion of 
such project, that not less than the wages prevailing in 
the locality, as predetermined by the Secretary of Labor 
pursuant to section 3142 of title 40, United States Code 
(commonly known as the ‘‘Davis-Bacon Act’’), shall be 
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paid to all laborers and mechanics employed to perform 
such contracts. 
SEC. 16. OBLIGATIONS NOT FEDERALLY GUARANTEED; 
STATE LAWS. 
(a) STATUS OF SECURITIES.— 
(1) NO
FULL
FAITH
AND
CREDIT
OF
THE 
U.S.—Obligations of the Corporation or the Insur-
ance Corporation, and obligations insured by any 
such corporation shall not be obligations of, or guar-
anteed as to principal or interest by, the United 
States or any agency of the United States and the 
obligations shall so plainly state. 
(2) FINANCING NOT TREATED AS U.S. GUAR-
ANTEE.—The provision of assistance of any kind or 
nature from NIC shall not be treated as a direct or 
indirect guarantee of any payment of principal or in-
terest on any security by the United States for pur-
poses of section 149(b) of the Internal Revenue 
Code of 1986 (26 U.S.C. 149(b)) or any other law. 
(b) STATE LAWS.—The receipt by any entity of any 
assistance under this Act, directly or indirectly, and any 
financial assistance provided by any governmental entity 
in connection with such assistance under this Act shall be 
valid and lawful notwithstanding any State or local restric-
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tions regarding extensions of credit or other benefits to 
private persons or entities, or other similar restrictions. 
SEC. 17. AUDITS; REPORTS TO THE PRESIDENT AND THE 
CONGRESS. 
(a) ACCOUNTING.—The books of account of NIC 
shall be maintained in accordance with generally accepted 
accounting principles and shall be subject to an annual 
audit by independent public accountants of nationally rec-
ognized standing. 
(b) REPORTS.—NIC shall submit to the President 
and the Congress, within 90 days after the end of each 
fiscal year, a complete and detailed report with respect 
to the preceding fiscal year, setting forth— 
(1) a summary of NIC’s operations, for such 
preceding fiscal year; 
(2) NIC’s financial statements and the opinion 
with respect thereto prepared by the independent 
public accountant reviewing such statements and a 
copy of any report made on an audit conducted 
under subsection (a) of this section; 
(3) a schedule of NIC’s obligations and capital 
securities outstanding at the end of such fiscal year, 
with a statement of the amounts issued and re-
deemed or paid during such fiscal year; and 
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(4) the status of projects receiving funding or 
other assistance pursuant to this Act, including dis-
closure of all entities with a development, ownership, 
or operational interest in such projects. 
(c) BOOKS AND RECORDS.— 
(1) IN GENERAL.—NIC shall maintain adequate 
books and records to support the financial trans-
actions of the Corporation, the Insurance Corpora-
tion, and subsidiaries of such corporations. 
(2) AUDITS BY THE SECRETARY AND GAO.— 
The books and records of NIC shall be maintained 
in accordance with recommended accounting prac-
tices and shall be open to inspection by the Sec-
retary and the Comptroller General of the United 
States. 
SEC. 18. TAX TREATMENT OF DISTRIBUTIONS FROM QUALI-
FIED RETIREMENT PLANS INVESTING IN 
PUBLIC BENEFIT BONDS. 
(a) IN GENERAL.—Section 72 of the Internal Rev-
enue Code of 1986 (relating to annuities; certain proceeds 
of endowment and life insurance contracts) is amended by 
redesignating subsection (x) as subsection (y) and by in-
serting after subsection (w) the following: 
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‘‘(x) TREATMENT OF DISTRIBUTION FROM QUALI-
FIED RETIREMENT PLANS INVESTING IN PUBLIC BEN-
EFIT BONDS.— 
‘‘(1) IN GENERAL.—In the case of any qualified 
retirement plan which receives directly or indirectly 
any interest on any public benefit bond (including 
any payments in respect thereof made by a surety 
or guarantor) for purposes of applying this section 
to any distribution from such plan, the distributee’s 
investment in the contract shall be treated as includ-
ing such distributee’s allocable share of such interest 
under the terms of the qualified retirement plan, 
and any such distribution shall be treated as a dis-
tribution described in subsection (e)(2)(B) in which 
the distribution is allocable first to the investment in 
the contract attributable to such interest. 
‘‘(2) TREATMENT OF INSTALLMENTS.—In the 
case of a distribution to be made over more than one 
calendar year, the amount of public benefit bond in-
terest to be taken into account with respect to a 
given calendar year shall be the aggregate amount of 
such interest allocable to the distributee as of the 
end of the prior calendar year. With respect to the 
final calendar year, the amount of public benefit 
bond interest to be taken into account shall include 
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