To amend the Internal Revenue Code of 1986 to provide for the tax-exempt financing of certain government-owned buildings.

Bill: 114-hr-5361
Sponsor: full_name: Rep. Kelly, Mike [R-PA-3]
Introduced: 2016-05-26
Policy area: Taxation
Subjects: Building construction

Educational facilities and institutions

Elementary and secondary education

Government buildings, facilities, and property

Health facilities and institutions

Higher education

Income tax exclusion

Law enforcement administration and funding

Libraries and archives

Research administration and funding

Securities
Latest action: action_date: 2016-05-26
text: Referred to the House Committee on Ways and Means.

Summaries:
action_date: 2016-05-26
action_desc: Introduced in House
text: <p>This bill amends the Internal Revenue Code to permit the tax-exempt financing of certain government-owned buildings by expanding the definition of &quot;exempt facility bond&quot; to include bonds used for qualified government buildings. </p> <p>A qualified government building is a government-owned building or facility that consists of one or more of the following: </p> <ul> <li>an elementary or secondary school;</li> <li>facilities of a state college or university used for educational purposes;</li> <li>a public library;</li> <li>a court;</li> <li>hospital, health care, laboratory, or research facilities; </li> <li>public safety facilities; or</li> <li>offices for government employees.</li> </ul> <p>The bill excludes buildings or facilities that include specified recreational equipment or are used for the primary purpose of providing retail food and beverage services, recreation, or entertainment.</p> <p>The bill establishes: (1) a $5 billion limit on the amount of tax-exempt financing which may be provided for government buildings, and (2) procedures for allocating and applying for the financing. </p> <p>The bill exempts the bonds for government buildings from the volume cap on private activity bonds. </p>

tv_txt: I 114th CONGRESS 2d Session H. R. 5361 IN THE HOUSE OF REPRESENTATIVES May 26, 2016 Mr. Kelly of Pennsylvania (for himself, Mr. Blumenauer , Mr. Nolan , Mr. Hastings , Mr. Kind , and Mr. Zeldin ) 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 tax-exempt financing of certain government-owned buildings.

1. Tax-exempt financing of qualified government buildings (a) In general Section 142(a) of the Internal Revenue Code of 1986 is amended by striking or at the end of paragraph (14), by striking the period at the end of paragraph (15) and inserting , or , and by adding at the end the following new paragraph: (16) qualified government buildings. . (b) Qualified government buildings Section 142 of such Code is amended by adding at the end the following new subsection: (n) Qualified governmental buildings (1) In general For purposes of subsection (a)(16), the term qualified governmental buildings means any building or facility that consists of one or more of the following: (A) An elementary school or a secondary school (within the meanings given such terms by section 14101 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 8801 ), as in effect on the date of the enactment of this subsection). (B) Facilities of a State college or university used for educational purposes. (C) A library maintained for, and open to, the general public. (D) A Court of law. (E) A hospital, health care facilities, laboratory facilities or research facilities. (F) Public safety facilities (including police, fire, enhanced 911, emergency or disaster management, and ambulance or emergency medical service facilities and jails and correctional facilities). (G) Offices for employees of a governmental unit. Such term shall include any equipment, functionally related and subordinate facility, or land (and any real property rights appurtenant thereto) with respect to any such building or facility. (2) Specifically excluded facilities Such term shall not include— (A) a building or facility the primary purpose of which is one of the following: retail food and beverage services, or the provision of recreation or entertainment, or (B) any building or facility that includes any of the following: any private or commercial golf course, country club, massage parlor, tennis club, skating facility (including roller skating, skateboard, and ice skating), racquet sports facility (including any handball or racquetball court), hot tub facility, suntan facility, racetrack, convention center, or sports stadium or arena. (3) National limitation on amount of tax-exempt financing for qualified governmental building (A) National limitation The aggregate amount allocated by the Secretary under subparagraph (C) shall not exceed $5,000,000,000. (B) Enforcement of national limitation An issue shall not be treated as an issue described in subsection (a)(16) if the aggregate face amount of bonds issued pursuant to such issue for any qualified governmental building (when added to the aggregate face amount of bonds previously so issued for such facility) exceeds the amount allocated to such qualified governmental building under subparagraph (C). (C) Allocation by the Secretary The Secretary shall allocate a portion of the amount described in subparagraph (A) to a qualified governmental building if the Secretary determines that— (i) the application for financing of such qualified governmental building meets the requirements set forth in subparagraph (D), and (ii) the amount of the allocation requested, if allocated by the Secretary, would not cause the national limitation set forth in subparagraph (A) to be exceeded. (D) Applications For Financing An application for financing a qualified governmental building meets the requirements of this subparagraph if such application includes— (i) the amount of the allocation requested, (ii) the name of the governmental unit that will own the project, together with complete contact information, (iii) a description of the project as a whole and the proposed organizational and legal structure of the project, (iv) a timeline showing the estimated start and completion dates for each major phase or milestone of project development and an indication of the current status of milestones on this timeline, including all necessary permits and environmental approvals, (v) a statement of anticipated sources and uses of funds for the project, and (vi) the following declaration signed by an individual who has personal knowledge of the relevant facts and circumstances: “Under penalties of perjury, I declare that I have examined this document and, to the best of my knowledge and belief, the document contains all the relevant facts relating to the document, and such facts are true, correct, and complete.” (E) Use of allocation in a timely manner If, following an allocation by the Secretary under subparagraph (C), bonds are not issued in the amount of such allocation after the date that is 2 years after the date of such allocation, then the unused portion of the allocation shall be withdrawn, unless the Secretary, upon a showing of good cause by the applicant, grants an extension of such date. (4) Exception for current refunding bonds Paragraph (4) shall not apply to any bond (or series of bonds) issued to refund a bond issued under subsection (a)(16) if— (A) the average maturity date of the issue of which the refunding bond is a part is not later than the average maturity date of the bonds to be refunded by such issue, (B) the amount of the refunding bond does not exceed the outstanding amount of the refunded bond, and (C) the refunded bond is redeemed not later than 90 days after the date of the issuance of the refunding bond. For purposes of subparagraph (A), average maturity shall be determined in accordance with section 147(b)(2)(A). (5) Office space Subsection (b)(2) shall not apply with respect to any qualified governmental building. (6) No depreciation or investment credit No depreciation, amortization, or business credit under section 38 shall be allowed with respect to any facility described in subsection (a)(16) which has been financed by the net proceeds of the issue for so long as such bonds are outstanding. . (c) Governmentally owned requirement Section 142(b)(1)(A) of such Code is amended by striking or (12) and inserting (12), or (16) . (d) Exemption from volume cap on private activity bonds Section 146(g)(3) of such Code is amended by striking or (15) and inserting (15), or (16) . (e) Effective date The amendments made by this section shall apply to bonds issued after the date of the enactment of this Act.