Nebraska Administrative Code › Topic - EDUCATION, DEPARTMENT OF › Title 92 - NEBRASKA DEPARTMENT OF EDUCATION › Chapter 87 - REGULATIONS GOVERNING QUALIFIED ZONE ACADEMY BONDS ALLOCATION › Appendix A - TITLE 26, UNITED STATES CODE, SECTION 1397E

Current through June 17, 2024
§1397E.
Credit to holder of qualified zone academy
				  bonds
.
(a)
Allowance of credit
. In the case of an
				  eligible taxpayer who holds a qualified zone academy bond on the credit
				  allowance date of such bond which occurs during the taxable year, there shall
				  be allowed as a credit against the tax imposed by this chapter for such taxable
				  year the amount determined under subsection (b).
(b)
Amount of credit
.
(1)
In general
. The amount of the credit
				  determined under this subsection with respect to any qualified zone academy
				  bond is the amount equal to the product of --
(A) the credit rate determined by the Secretary under
				  paragraph (2) for the month in which such bond was issued, multiplied by
(B) the face amount of the bond held by the taxpayer on the
				  credit allowance date.
(2)
Determination
. During each calendar month,
				  the Secretary shall determine a credit rate which shall apply to bonds issued
				  during the following calendar month. The credit rate for any month is the
				  percentage which the Secretary estimates will permit the issuance of qualified
				  zone academy bonds without discount and without interest cost to the
				  issuer.
(c)
Limitation based on amount of tax
. The credit
				  allowed under subsection (a) for any taxable year shall not exceed the excess
				  of --
(d)
Qualified zone academy bond
. For purposes of
				  this section --
(1)
In general
. The term 'qualified zone academy
				  bond' means any bond issued as part of an issue if --
(A) 95 percent or more of the proceeds of such issue are to
				  be used for a qualified purpose with respect to a qualified zone academy
				  established by an eligible local education agency,
(B) the bond is issued by a State or local government within
				  the jurisdiction of which such academy is located,
(C) the issuer --
(i) designates such bond for purposes of this section.
(ii) certifies that it has written assurances that the
				  private business contribution requirement of paragraph (2) will be met with
				  respect to such academy, and
(iii) certifies that it has the written approval of the
				  eligible local education agency for such bond issuance, and
(2)
Private business contribution requirement
.
(i) equipment for use in the qualified zone academy
				  (including state-of-the-art technology and vocational equipment)
(ii) technical assistance in developing curriculum or in
				  training teachers in order to promote appropriate market driven technology in
				  the classroom.
(iii) services of employees as volunteer mentors,
(iv) internships, field trips, or other educational
				  opportunities outside the academy for students, or
(v) any other property or service specified by the eligible
				  local education agency.
(3)
Term requirement
. During each calendar month,
				  the Secretary shall determine the maximum term permitted under this paragraph
				  for bonds issued during the following calendar month. Such maximum term shall
				  be the term which the Secretary estimates will result in the present value of
				  the obligation to repay the principal on the bond being equal to 50 percent of
				  the face amount of the bond. Such present value shall be determined using as a
				  discount rate the average annual interest rate of tax-exempt obligations having
				  a term of 10 years or more which are issued during the month. If the term as so
				  determined is not a multiple of a whole year, such term shall be rounded to the
				  next higher whole year.
(4)
Qualified zone academy
.
(A) In general. The term 'qualified zone academy' means any
				  public school (or academic program within a public school) which is established
				  by and operated under the supervision of an eligible local education agency to
				  provide education or training below the postsecondary level if --
(i) such public school or program (as the case may be) is
				  designed in cooperation with business to enhance the academic curriculum,
				  increase graduation and employment rates, and better prepare students for the
				  rigors of college and the increasingly complex workforce,
(ii) students in such public school or program (as the case
				  may be) will be subject to the same academic standards and assessments as other
				  students educated by the eligible local education agency,
(iii) the comprehensive education plan of such public school
				  or program is approved by the eligible local education agency, and
(iv)
(II) there is a reasonable expectation (as of the date of
				  issuance of the bonds) that at least 35 percent of the students attending such
				  school or participating in such program (as the case may be) will be eligible
				  for free or reduced-cost lunches under the school lunch program established
				  under the National School Lunch Act.
(B) Eligible local education agency. The term 'eligible local
				  education agency' means any local education agency as defined in section 14101
				  of the Elementary and Secondary Education Act of 1965.
(5)
Qualified purpose
. The term 'qualified
				  purpose' means, with respect to any qualified zone academy --
(A) rehabilitating or repairing the public school facility in
				  which the academy is established.
(B) providing equipment for use at such academy.
(C) developing course materials for education to be provided
				  at such academy, and
(D) training teachers and other school personnel in such
				  academy.
(6)
Eligible taxpayer
. The term 'eligible
				  taxpayer' means --
(B) an insurance company to which subchapter L applies,
				  and
(C) a corporation actively engaged in the business of lending
				  money.
(e)
Limitation on amount of bonds designated
.
(1)
National limitation
. There is a national zone
				  academy bond limitation for each calendar year. Such limitation is $400,000,000
				  for 1998 and 1999, and, except as provided in paragraph (4), zero
				  thereafter.
(2)
Allocation of limitation
. The national zone
				  academy bond limitation for a calendar year shall be allocated by the Secretary
				  among the States on the basis of their respective populations of individuals
				  below the poverty line (as defined by the Office of Management and Budget). The
				  limitation amount allocated to a State under the preceding sentence shall be
				  allocated by the State education agency to qualified zone academies within such
				  State.
(3)
Designation subject to limitation amount.
The
				  maximum aggregate face amount of bonds issued during any calendar year which
				  may be designated under subsection(d)(1) with respect to any qualified zone
				  academy shall not exceed the limitation amount allocated to such academy under
				  paragraph (2) for such calendar year.
(4)
Carryover of unused limitation
. If for any
				  calendar year --
(A) the limitation amount for any State, exceeds
(f)
Other definitions
. For purposes of this
				  section --
(1)
Credit allowance date
. The term 'credit
				  allowance date' means, with respect to any issue, the last day of the 1-year
				  period beginning on the date of issuance of such issue and the last day of each
				  successive 1-year period thereafter.
(2)
Bond
. The term 'bond' includes any
				  obligation.
(3)
State
. The term 'State' includes the District
				  of Columbia and any possession of the United States.
(g)
Credit included in gross income
. Gross income
				  includes the amount of the credit allowed to the taxpayer under this
				  section.