Title: HBCU Investment Expansion Act
Policy area: Taxation

Summary:
HBCU Investment Expansion Act
This bill amends the Securities Act of 1933 to exempt qualified 501(c)(3) bonds issued after the enactment of this bill on behalf of a historically black college or university from state and local taxes.
The bill also amends the Internal Revenue Code to allow a tax credit for jurisdictions that forgo taxes with respect to the interest payments under such a bond. The credit is equal to the total amount of interest paid on such a bond during the taxable year. The Department of the Treasury must pay the credit to the qualifying jurisdiction as soon as practicable after the recipient of the interest payments files a tax return with the jurisdiction.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1080 Introduced in House (IH)]

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115th CONGRESS
  1st Session
                                H. R. 1080

 To amend the Securities Act of 1933 and the Internal Revenue Code of 
 1986 to provide an exemption and payments from taxation for 501(c)(3) 
 bonds issued on behalf of a historically Black college or university.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           February 15, 2017

    Mr. Ellison (for himself, Mr. Scott of Virginia, Ms. Adams, Mr. 
 Conyers, Ms. Lee, Mr. Payne, and Ms. Moore) introduced the following 
  bill; which was referred to the Committee on Ways and Means, and in 
  addition to the Committee on Financial Services, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL


 
 To amend the Securities Act of 1933 and the Internal Revenue Code of 
 1986 to provide an exemption and payments from taxation for 501(c)(3) 
 bonds issued on behalf of a historically Black college or university.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``HBCU Investment Expansion Act''.

SEC. 2. TAX EXEMPTION FOR HBCU BONDS.

    The Securities Act of 1933 (15 U.S.C. 77aa et seq.) is amended by 
inserting after section 28 the following:

``SEC. 29. TAX EXEMPTION FOR HBCU BONDS.

    ``(a) In General.--A qualified 501(c)(3) bond (as defined in 
section 145 of the Internal Revenue Code of 1986) issued after the date 
of the enactment of the HBCU Investment Expansion Act on behalf of a 
historically Black college or university shall be exempt from taxation 
by any State, Territory, or possession, or by any county, municipality, 
or other municipal subdivision of any State, territory, or possession 
of the United States, or by the District of Columbia.
    ``(b) Historically Black College or University Defined.--For 
purposes of this section, the term `historically Black college or 
university' means a part B institution (as defined in section 322(2) of 
the Higher Education Act of 1965 (20 U.S.C. 1061(2)).''.

SEC. 3. CREDIT WITH RESPECT TO 501(C)(3) BONDS ISSUED ON BEHALF OF 
              HISTORICALLY BLACK COLLEGES AND UNIVERSITIES.

    (a) In General.--Subchapter B of chapter 65 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following:

``SEC. 6433. CREDIT WITH RESPECT TO 501(C)(3) BONDS ISSUED ON BEHALF OF 
              HISTORICALLY BLACK COLLEGES AND UNIVERSITIES.

    ``(a) In General.--In the case of a qualified bond issued after the 
date of the enactment of the HBCU Investment Expansion Act, a credit 
shall be allowed to a jurisdiction specified in subsection (c)(3) that 
forgoes tax pursuant to section 29 of the Securities Act of 1933 with 
respect to each interest payment under such bond. The credit shall be 
payable by the Secretary as provided in subsection (b).
    ``(b) Payment of Credit.--The Secretary shall pay (as soon as 
practicable after the return of income tax for a taxable year is filed 
with the qualified jurisdiction by the recipient of such interest 
payment under such bond) an amount equal to the total amount of 
interest paid under such bond during the taxable year.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Qualified bond.--The term `qualified bond' means a 
        qualified 501(c)(3) bond (as defined in section 145) issued on 
        behalf of a historically Black college or university.
            ``(2) Historically black college or university.--The term 
        `historically Black college or university' means a part B 
        institution (as defined in section 322(2) of the Higher 
        Education Act of 1965 (20 U.S.C. 1061(2)).
            ``(3) Jurisdiction specified.--A jurisdiction is specified 
        in this paragraph if the jurisdiction is--
                    ``(A) a State, territory, or possession of the 
                United States,
                    ``(B) a political jurisdiction of a State, 
                territory, or possession of the United States, or
                    ``(C) the District of Columbia.
    ``(d) Application of Arbitrage Rules.--For purposes of section 148, 
the yield on a qualified bond shall be reduced by the credit allowed 
under this section.
    ``(e) Regulations.--The Secretary shall issue such regulations or 
other guidance as may be necessary to carry out this section.''.
    (b) Conforming Amendments.--
            (1) Section 1324(b)(2) of title 31, United States Code, is 
        amended by striking ``or 6431'' and inserting ``6431, or 
        6433''.
            (2) Section 6211(b)(4)(A) of the Internal Revenue Code of 
        1986 is amended by striking ``and 6431'' and inserting ``6431, 
        and 6433''.
            (3) The table of sections for subchapter B of chapter 65 of 
        the Internal Revenue Code of 1986 is amended by adding at the 
        end the following new item:

``Sec. 6433. Credit with respect to 501(c)(3) bonds issued on behalf of 
                            historically Black colleges and 
                            universities.''.
    (c) 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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