,i #aac? ,,congress #a/ ,session ,h4 ,r4 #eje ,,9 ,,! ,,h\se ,,( ,,repres5tatives ,febru>y #e1 #bjac ,mr4 ,ellison 7= himself1 ,mr4 ,grijalva1 ,mr4 ,cony]s1 ,mr4 ,mc,dermott1 ,ms4 ,cl>ke1 ,mr4 ,nadl]1 ,ms4 ,lee ( ,cali=nia1 ,mr4 ,m>key1 ,ms4 ,s*ak[sky1 ,ms4 ,*u1 ,mr4 ,coh51 ,mr4 ,clay1 ,ms4 ,eddie ,b]nice ,johnson ( ,texas1 ,mr4 ,grayson1 & ,mr4 ,guti]rez7 introduc$ ! foll[+ bill2 :i* 0 ref]r$ to ! ,committee on ,ways & ,means1 & 9 addition to ! ,committees on ! ,budget1 ,ov]sight & ,gov]nm5t ,re=m1 ,arm$ ,s]vices1 ,education & ! ,work=ce1 ,transportation & ,infra/ructure1 & ,f9ancial ,s]vices1 = a p]iod to be subsequ5tly det]m9$ by ! ,speak]1 9 ea* case = consid]ation ( su* provisions z fall )9 ! jurisdiction ( ! committee conc]n$ ,a ,,bill ,to repeal seque/] :ile a*iev+ balance 9 deficit r$uction betwe5 rev5ue & cuts1 & betwe5 non-def5se cuts & def5se cuts1 to inve/ 9 job creation1 & = o!r purposes4 #a4 ,%ort title2 table ( cont5ts 7a7 ,%ort ,title ,?is ,act may be cit$ z ! ,balanc+ ,act4 7b7 ,table ( cont5ts ,! table ( cont5ts = ?is ,act is z foll[s3 ,sec4 #a4 ,%ort title2 table ( cont5ts4 ,title ,i--,repeal ,seque/] ,sec4 #aja4 ,repeal ( section #bea;,a seque/ration to en=ce budget goal4 ,title ,,ii--,close ,tax ,loopholes to ,a*ieve ,balance ,subtitle ,a--#bh ,p]c5t ,limitation on ,c]ta9 ,d$uctions & ,exclusions ,sec4 #bja4 #bh p]c5t limitation on c]ta9 d$uctions & exclusions4 ,subtitle ,b--,tax c>ri$ int]e/ 9 inve/m5t p>tn]%ips z ord9>y income ,sec4 #baa4 ,p>tn]%ip int]e/s transf]r$ 9 connection ) p]=mance ( s]vices4 ,sec4 #bab4 ,special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips4 ,subtitle ,c--,dual capacity taxpay]s ,sec4 #bba4 ,modifications ( =eign tax cr$it rules applicable to dual capacity taxpay]s4 ,sec4 #bbb4 ,sep>ate basket treatm5t taxes paid on =eign oil & gas income4 ,subtitle ,d--,close ,exclusion ( ,=eign-,e>n$ ,income ,loophole ,sec4 #bca4 ,repeal ( =eign e>n$ income exclusion4 ,subtitle ,e--,close ,s ,corporation ,loophole ,sec4 #bda4 ,employm5t tax treatm5t ( pr(essional s]vice bus9esses4 ,subtitle ,f--,limitation on ,mortgage ,int]e/ ,d$uction ,) ,respect to ,boats ,sec4 #bea4 ,mortgage int]e/ d$uction all[$ ) respect to boats only if boat is us$ z ! pr9cipal resid5ce ( ! taxpay]4 ,title ,,iii--,end+ ,corporate ,subsidies ,subtitle ,a--,end ,fossil ,fuel ,subsidies ,sec4 #cja4 ,t]m9ation ( v>i\s tax exp5ditures relat+ to fossil fuels4 ,sec4 #cjb4 ,t]m9ation ( alt]native fuel vehicle refuel+ prop]ty cr$it ) respect to fossil fuels4 ,sec4 #cjc4 ,uni=m sev5-ye> amortization = geological & geophysical exp5ditures4 ,sec4 #cjd4 ,repeal ( dome/ic manufactur+ d$uction = h>d m9]al m9+4 ,sec4 #cje4 ,limitation on d$uction = income attributable to dome/ic production ( oil1 natural gas1 or prim>y products !re(4 ,sec4 #cjf4 ,t]m9ation ( la/-91 fir/-out me?od ( inv5tory = oil1 natural gas1 & coal companies4 ,sec4 #cjg4 ,repeal ( p]c5tage depletion = coal & h>d m9]al fossil fuels4 ,sec4 #cjh4 ,t]m9ation ( capital ga9s treatm5t = royalties f coal4 ,sec4 #cji4 ,increase 9 oil spill liability tru/ fund f9anc+ rate4 ,sec4 #caj4 ,d5ial ( d$uction = removal co/s & damages = c]ta9 oil spills4 ,sec4 #caa4 ,tax on crude oil & natural gas produc$ f ! out] ,cont95tal ,%elf 9 ! ,gulf ( ,mexico4 ,subtitle ,b--,end+ ,excessive ,corporate ,tax ,d$uctions = ,/ock ,options ,sec4 #cca4 ,consi/5t treatm5t ( /ock options by corporations4 ,sec4 #ccb4 ,application ( executive pay d$uction limit4 ,subtitle ,c--,r$uce ,d$uction ( ,corporate ,meals & ,ent]ta9m5t ,sec4 #cda4 ,r$uction 9 bus9ess meals & ent]ta9m5t tax d$uction4 ,title ,,iv--,close ,int]national ,tax ,sy/em ,loopholes ,subtitle ,a--,re=mation ( ,u4,s4 int]national tax sy/em ,sec4 #dja4 ,allocation ( exp5ses & taxes on basis ( repatriation ( =eign income4 ,sec4 #djb4 ,excess income f transf]s ( intangibles to l[-tax$ affiliates treat$ z subp>t ,f income4 ,sec4 #djc4 ,limitations on income %ift+ ?r\gh intangible prop]ty transf]s4 ,sec4 #djd4 ,limitation on e>n+s /ripp+ by expatriat$ entities4 ,sec4 #dje4 ,prev5tion ( avoidance ( tax ?r\gh re9surance ) non-tax$ affiliates4 ,subtitle ,b--,re9surance ,sec4 #daa4 ,prev5tion ( avoidance ( tax ?r\gh re9surance ) non-tax$ affiliates4 ,subtitle ,c--,close loophole = corporate jet depreciation ,sec4 #dba4 ,g5]al aviation aircraft treat$ z #g-ye> prop]ty4 ,title ,v--,close ,e/ate ,tax ,loopholes ,sec4 #eja4 ,valuation rules = c]ta9 transf]s ( nonbus9ess assets2 limitation on m9ority disc\nts4 ,sec4 #ejb4 ,consi/5t basis report+ betwe5 e/ate & p]son acquir+ prop]ty f dec$5t4 ,sec4 #ejc4 ,requir$ m9imum #aj-ye> t]m1 etc41 = grantor reta9$ annuity tru/s4 ,sec4 #ejd4 ,limitation on ,,g/ exemption ( p]petual dyna/y tru/s4 ,title ,,vi--,cut ,p5tagon ,wa/e to ,a*ieve ,balance ,subtitle ,a--,sm>t] ,approa* to nucle> ,exp5ditures ,sec4 #fja4 ,%ort title4 ,sec4 #fjb4 ,f9d+s4 ,sec4 #fjc4 ,r$uction 9 nucle> =ces4 ,sec4 #fjd4 ,reports requir$4 ,subtitle ,b--,limit+ ,excessive ,contractor ,comp5sation ,sec4 #faa4 ,limitation on all[able comp5sation co/s4 ,subtitle ,c--,relocate ,troops ,f ,europe to ! ,unit$ ,/ates ,sec4 #fae4 ,relocation to ,unit$ ,/ates milit>y in/allations ( memb]s ( ! ,unit$ ,/ates ,arm$ ,=ces assign$ to p]man5t duty 9 ,europe4 ,subtitle ,d--,additional r$uction 9 arm$ =ces end /r5g? levels ,sec4 #fba4 ,additional ,army & ,m>9e ,corps end /r5g? r$uctions ?r\gh retirem5t & sep>ation4 ,subtitle ,e--,procurem5t ( c]ta9 subm>9es1 c>ri]s1 & aircraft ,sec4 #fca4 ,limitation on procurem5t ( ,virg9ia class subm>9es4 ,sec4 #fcb4 ,limitation on procurem5t ( "o ,=d class aircraft c>ri]4 ,sec4 #fcc4 ,au?ority = procurem5t ( ,f_/,a-#ah;,e & ,f_/,a-#ah;,f aircraft4 ,sec4 #fcd4 ,prohibition on procurem5t ( ,v-#bb ,osprey aircraft4 ,subtitle ,f--,limit ,milit>y ,b&s ,sec4 #fda4 ,limitation on exp5ditures = milit>y musical units4 ,subtitle ,g--,r$uction 9 ,numb] ( ,g5]al & ,flag ,(fic]s ,sec4 #fea4 ,return ( maximum numb] ( g5]al & flag (fic]s to ,cold ,w> levels4 ,subtitle ,h--,audit ! ,p5tagon ,sec4 #ffa4 ,purposes4 ,sec4 #ffb4 ,f9d+s4 ,sec4 #ffc4 ,sp5d+ r$uctions = ag5cies )\t clean audits4 ,sec4 #ffd4 ,report on ,dep>tm5t ( ,def5se report+ requirem5ts4 ,sec4 #ffe4 ,s5se ( ,congress 9 implem5tation ( def5se budget r$uctions4 ,title ,,vii--,inve/ 9 ,job ,creation ,subtitle ,a--,mak+ ,"w ,pay ,ext5sion ,sec4 #gja4 ,"o-ye> ext5sion ( mak+ "w pay cr$it4 ,subtitle ,b--,support = ,tea*]s & ,s*ool ,mod]nization ,"p ,i--,prev5t+ tea*] lay(fs & support+ ! creation ( additional jobs 9 public e>ly *ildhood1 elem5t>y1 & second>y education ,sec4 #gaa4 ,purpose4 ,sec4 #gab4 ,grants = ! outly+ areas & ! ,secret>y ( ! ,int]ior2 availability ( funds4 ,sec4 #gac4 ,/ate allocation4 ,sec4 #gad4 ,/ate application4 ,sec4 #gae4 ,/ate res]vation & responsibilities4 ,sec4 #gaf4 ,local educational ag5cies4 ,sec4 #gag4 ,e>ly le>n+4 ,sec4 #gah4 ,ma9t5ance ( ef=t4 ,sec4 #gai4 ,report+4 ,sec4 #gbj4 ,def9itions4 ,sec4 #gba4 ,au?orization ( appropriations4 ,"p ,,ii--,elem5t>y & second>y s*ools ,sec4 #gca4 ,purpose4 ,sec4 #gcb4 ,au?orization ( appropriations4 ,sec4 #gcc4 ,allocation ( funds4 ,sec4 #gcd4 ,/ate use ( funds4 ,sec4 #gce4 ,/ate & local applications4 ,sec4 #gcf4 ,use ( funds4 ,sec4 #gcg4 ,private s*ools4 ,sec4 #gch4 ,additional provisions4 ,"p ,,iii--,community ,college mod]nization ,sec4 #gci4 ,f$]al assi/ance = community college mod]nization4 ,"p ,,iv--,g5]al provisions ,sec4 #gdj4 ,def9itions4 ,sec4 #gda4 ,buy ,am]ican4 ,subtitle ,c--,transportation ,infra/ructure ,inve/m5ts ,"p ,i--,imm$iate transportation infra/ructure inve/m5ts ,sec4 #gea4 ,imm$iate transportation infra/ructure inve/m5ts4 ,"p ,,ii--,build+ & upgrad+ infra/ructure = long-,t]m developm5t ,subp>t ,a--,imm$iate transportation infra/ructure inve/m5ts ,sec4 #gfa4 ,%ort title4 ,sec4 #gfb4 ,f9d+s & purpose4 ,sec4 #gfc4 ,def9itions4 ,subp>t ,b--,am]ican ,infra/ructure ,f9anc+ ,au?ority ,sec4 #gfe4 ,e/abli%m5t & g5]al au?ority ( ,,aifa4 ,sec4 #gff4 ,vot+ memb]s ( ! ,bo>d ( ,directors4 ,sec4 #gfg4 ,*ief executive (fic] ( ,,aifa4 ,sec4 #gfh4 ,p[]s & duties ( ! ,bo>d ( ,directors4 ,sec4 #gfi4 ,s5ior managem5t4 ,sec4 #ggj4 ,special ,inspector ,g5]al = ,,aifa4 ,sec4 #gga4 ,o!r p]sonnel4 ,sec4 #ggb4 ,compliance4 ,subp>t ,c--,t]ms & limitations on direct loans & loan gu>antees ,sec4 #ggc4 ,eligibility crit]ia = assi/ance f ,,aifa & t]ms & limitations ( loans4 ,sec4 #ggd4 ,loan t]ms & repaym5t4 ,sec4 #gge4 ,compliance & en=cem5t4 ,sec4 #ggf4 ,audits2 reports to ! ,presid5t & ,congress4 ,subp>t ,d--,fund+ ( ,,aifa ,sec4 #ggg4 ,adm9i/rative fees4 ,sec4 #ggh4 ,effici5cy ( ,,aifa4 ,sec4 #ggi4 ,fund+4 ,subp>t ,e--,ext5sion ( exemption f alt]native m9imum tax treatm5t = c]ta9 tax-,exempt bonds ,sec4 #ghj4 ,ext5sion ( exemption f alt]native m9imum tax treatm5t = c]ta9 tax-exempt bonds4 ,i ,repeal ,seque/] #aja4 ,repeal ( section #bea;,a seque/ration to en=ce budget goal ,section #bea;,a ( ! ,balanc$ ,budget & ,em]g5cy ,deficit ,control ,act ( #aihe is repeal$4 ,,ii ,close ,tax ,loopholes to ,a*ieve ,balance ,a #bh ,p]c5t ,limitation on ,c]ta9 ,d$uctions & ,exclusions #bja4 #bh p]c5t limitation on c]ta9 d$uctions & exclusions 7a7 ,9 g5]al ,"p ,i ( sub*apt] ,b ( *apt] #a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new section3 #fi4 ,limitation on c]ta9 d$uctions & exclusions 7a7 ,9 g5]al ,9 ! case ( an individual = any taxable ye>1 if-- 7#a7 ! taxpay]'s adju/$ gross income is above-- 7,a7 #bej1jjj 9 ! case ( a jo9t return )9 ! mean+ ( section #fjac1 7,b7 #bbe1jjj 9 ! case ( a head ( h\sehold return1 7,c7 #abe1jjj 9 ! case ( a m>ri$ fil+ sep>ately return1 or 7,d7 #bjj1jjj 9 all o!r cases2 & 7#b7 ! taxpay]'s adju/$ taxable income = su* taxable ye> exce$s ! m9imum m>g9al rate am\nt1 !n ! tax impos$ "u section #a ) respect to su* taxpay] = su* taxable ye> %all be increas$ by ! am\nt det]m9$ "u subsection 7b74 ,if ! taxpay] is subject to tax "u section #ee1 !n 9 lieu ( an increase 9 tax "u section #a1 ! tax impos$ "u section #ee ) respect to su* taxpay] = su* taxable ye> %all be increas$ by ! am\nt det]m9$ "u subsection 7c74 7b7 ,additional am\nt ,! am\nt det]m9$ "u ?is subsection ) respect to any taxpay] = any taxable ye> is ! excess 7if any7 (-- 7#a7 ! tax :i* w\ld be impos$ "u section #a ) respect to su* taxpay] = su* taxable ye> if adju/$ taxable income 7 sub/itut$ = taxable income ea* place x appe>s !re91 ov] 7#b7 ! sum (-- 7,a7 ! tax :i* w\ld be impos$ "u su* section ) respect to su* taxpay] = su* taxable ye> on ! great] (-- 7i7 taxable income1 or 7ii7 ! m9imum m>g9al rate am\nt1 plus 7,b7 #bh p]c5t ( ! excess 7if any7 ( ! taxpay]'s adju/$ taxable income ov] ! great] (-- 7i7 ! taxpay]'s taxable income1 or 7ii7 ! m9imum m>g9al rate am\nt4 7c7 ,additional ,,amt am\nt 7#a7 ,! am\nt det]m9$ "u ?is subsection ) respect to any taxpay] = any taxable ye> is ! additional am\nt comput$ "u subsection 7b7 multipli$ by ! ratio t-- 7,a7 ! result (-- 7i7 all itemiz$ d$uctions 7be=e ! application ( section #fh71 plus 7ii7 ! specifi$ above-!-l9e d$uctions & specifi$ exclusions1 m9us 7iii7 ! am\nt ( d$uctions disall[$ "u section #ef7;b77#a77;,a7 & 7,b71 m9us 7iv7 ! non-pref]5ce disall[$ d$uctions1 be>s to-- 7,b7 ! sum (-- 7i7 ! total ( itemiz$ d$uctions 7aft] ! application ( section #fh71 plus 7ii7 ! specifi$ above-!-l9e d$uctions & specifi$ exclusions4 7#b7 ,if ! top ( ! ,,amt exemption phase-out range = ! taxpay] exce$s ! m9imum m>g9al rate am\nt = ! taxpay] & if ! taxpay]'s alt]native m9imum taxable income does n exce$ ! top ( ! ,,amt exemption phase-out range1 ! taxpay] mu/ increase its additional ,,amt am\nt by #g p]c5t ( ! excess (-- 7,a7 ! less] (-- 7i7 ! top ( ! ,,amt exemption phase-out range1 or 7ii7 ! taxpay]'s alt]native m9imum taxable income1 comput$-- 7,i7 )\t reg>d to any itemiz$ d$uction or any specifi$ above-!-l9e d$uction1 & 7,,ii7 by includ+ ! am\nt ( any specifi$ exclusion2 ov] 7,b7 ! great] (-- 7i7 ! taxpay]'s alt]native m9imum taxable income1 or 7ii7 ! m9imum m>g9al rate am\nt4 7d7 ,m9imum m>g9al rate am\nt ,= purposes ( ?is section1 ! t]m m9imum m>g9al rate am\nt means1 ) respect to any taxpay] = any taxable ye>1 ! highe/ am\nt ( ! taxpay]'s taxable income :i* w\ld be subject to a m>g9al rate ( tax "u section #a t is less ?an #cf p]c5t ) respect to su* taxable ye>4 7e7 ,adju/$ taxable income ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m adju/$ taxable income means taxable income comput$-- 7,a7 )\t reg>d to any itemiz$ d$uction or any specifi$ above-!-l9e d$uction1 & 7,b7 by includ+ 9 gross income any specifi$ exclusion4 7#b7 ,specifi$ above-!-l9e d$uction ,! t]m specifi$ above-!-l9e d$uction means-- 7,a7 ! d$uction provid$ "u section #afb7l7 7relat+ to special rules = heal? insurance co/s ( self-employ$ individuals71 7,b7 ! d$uction provid$ "u section #aii 7relat+ to income attributable to dome/ic production activities71 & 7,c7 ! d$uctions provid$ "u ! foll[+ p>agraphs ( section #fb7;a73 7i7 ,p>agraph 7#b7 7relat+ to c]ta9 trade & bus9ess d$uctions ( employees71 o!r ?an subp>agraph 7,a7 !re(4 7ii7 ,p>agraph 7#ae7 7relat+ to mov+ exp5ses74 7iii7 ,p>agraph 7#af7 7relat+ to ,ar*] ,m,s,as74 7iv7 ,p>agraph 7#ag7 7relat+ to int]e/ on education loans74 7v7 ,p>agraph 7#ah7 7relat+ to high] education exp5ses74 7vi7 ,p>agraph 7#ai7 7relat+ to heal? sav+s acc\nts74 7#c7 ,specifi$ exclusion ,! t]m specifi$ exclusion means-- 7,a7 any int]e/ exclud$ "u section #ajc1 7,b7 any exclusion ) respect to ! co/ describ$ 9 section #fjea7;a77#ad7 7)\t reg>d to subp>agraph 7,b7 !re(71 & 7,c7 any =eign e>n$ income exclud$ "u section #iaa4 7f7 ,non-,pref]5ce disall[$ d$uctions ,= purposes ( ?is section1 ! t]m ,,amt-all[$ d$uctions means all itemiz$ d$uctions disall[$ by section #fh multipli$ by ! ratio t-- 7#a7 a taxpay]'s itemiz$ d$uctions = ! taxable ye> t are subject to section #fh 7t is1 n includ+ ^? exclud$ "u section #fh7;c77 & t are n limit$ "u section #ef7;b77#a77;,a7 or 7,b71 be>s to 7#b7 ! taxpay]'s itemiz$ d$uctions = ! taxable ye> t are subject to section #fh 7t is1 n includ+ ^? exclud$ "u section #fh7;c774 7g7 ,regulations ,! ,secret>y %all prescribe su* regulations z may be appropriate to c>ry out ?is section1 includ+ regulations :i* provide appropriate adju/m5ts to ! additional ,,amt am\nt4 4 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ on or aft] ,janu>y #a1 #bjac4 ,b ,tax c>ri$ int]e/ 9 inve/m5t p>tn]%ips z ord9>y income #baa4 ,p>tn]%ip int]e/s transf]r$ 9 connection ) p]=mance ( s]vices 7a7 ,modification to election ,to include p>tn]%ip int]e/ 9 gross income 9 ye> ( transf] ,subsection 7c7 ( section #hc ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by r$esignat+ p>agraph 7#d7 z p>agraph 7#e7 & by ins]t+ aft] p>agraph 7#c7 ! foll[+ new p>agraph3 7#d7 ,p>tn]%ip int]e/s ,except z provid$ by ! ,secret>y-- 7,a7 ,9 g5]al ,9 ! case ( any transf] ( an int]e/ 9 a p>tn]%ip 9 connection ) ! provision ( s]vices to 7or = ! b5efit (7 su* p>tn]%ip-- 7i7 ! fair m>ket value ( su* int]e/ %all be treat$ = purposes ( ?is section z be+ equal to ! am\nt ( ! di/ribution :i* ! p>tn] w\ld receive if ! p>tn]%ip sold 7at ! "t ( ! transf]7 all ( its assets at fair m>ket value & di/ribut$ ! proce$s ( su* sale 7r$uc$ by ! liabilities ( ! p>tn]%ip7 to its p>tn]s 9 liquidation ( ! p>tn]%ip1 & 7ii7 ! p]son receiv+ su* int]e/ %all be treat$ z hav+ made ! election "u subsection 7b77#a7 unless su* p]son makes an election "u ?is p>agraph to h su* subsection n apply4 7,b7 ,election ,! election "u subp>agraph 7,a77ii7 %all be made "u rules simil> to ! rules ( subsection 7b77#b74 4 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to int]e/s 9 p>tn]%ips transf]r$ aft] ,decemb] #ca1 #bjab4 #bab4 ,special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips 7a7 ,9 g5]al ,"p ,i ( sub*apt] ,k ( *apt] #a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new section3 #gaj4 ,special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips 7a7 ,treatm5t ( di/ributive %>e ( p>tn]%ip items ,= purposes ( ?is title1 9 ! case ( an inve/m5t s]vices p>tn]%ip int]e/-- 7#a7 ,9 g5]al ,not)/&+ section #gjb7;b7-- 7,a7 an am\nt equal to ! net capital ga9 ) respect to su* int]e/ = any p>tn]%ip taxable ye> %all be treat$ z ord9>y income1 & 7,b7 subject to ! limitation ( p>agraph 7#b71 an am\nt equal to ! net capital loss ) respect to su* int]e/ = any p>tn]%ip taxable ye> %all be treat$ z an ord9>y loss4 7#b7 ,re*>act]ization ( losses limit$ to re*>act]iz$ ga9s ,! am\nt treat$ z ord9>y loss "u p>agraph 7#a77;,b7 = any taxable ye> %all n exce$ ! excess 7if any7 (-- 7,a7 ! aggregate am\nt treat$ z ord9>y income "u p>agraph 7#a77;,a7 ) respect to ! inve/m5t s]vices p>tn]%ip int]e/ = all prec$+ p>tn]%ip taxable ye>s to :i* ?is section applies1 ov] 7,b7 ! aggregate am\nt treat$ z ord9>y loss "u p>agraph 7#a77;,b7 ) respect to su* int]e/ = all prec$+ p>tn]%ip taxable ye>s to :i* ?is section applies4 7#c7 ,allocation to items ( ga9 & loss 7,a7 ,net capital ga9 ,! am\nt treat$ z ord9>y income "u p>agraph 7#a77;,a7 %all be allocat$ ratably among ! items ( long-t]m capital ga9 tak5 into acc\nt 9 det]m9+ su* net capital ga94 7,b7 ,net capital loss ,! am\nt treat$ z ord9>y loss "u p>agraph 7#a77;,b7 %all be allocat$ ratably among ! items ( long-t]m capital loss & %ort-t]m capital loss tak5 into acc\nt 9 det]m9+ su* net capital loss4 7#d7 ,t]ms relat+ to capital ga9s & losses ,= purposes ( ?is section-- 7,a7 ,9 g5]al ,net capital ga91 long-t]m capital ga91 & long-t]m capital loss1 ) respect to any inve/m5t s]vices p>tn]%ip int]e/ = any taxable ye>1 %all be det]m9$ "u section #abbb1 except t su* section %all be appli$-- 7i7 )\t reg>d to ! re*>act]ization ( any item z ord9>y income or ord9>y loss "u ?is section1 7ii7 by only tak+ into acc\nt items ( ga9 & loss tak5 into acc\nt by ! hold] ( su* int]e/ "u section #gjb ) respect to su* int]e/ = su* taxable ye>1 7iii7 by treat+ prop]ty :i* is tak5 into acc\nt 9 det]m9+ ga9s & losses to :i* section #abca applies z capital assets held = m ?an #a ye>1 & 7iv7 )\t reg>d to section #abjb4 7,b7 ,net capital loss ,! t]m net capital loss means ! excess ( ! losses f sales or ex*anges ( capital assets ov] ! ga9s f su* sales or ex*anges4 ,rules simil> to ! rules ( clauses 7i7 ?r\gh 7iv7 ( subp>agraph 7,a7 %all apply = purposes ( ! prec$+ s5t5ce4 7#e7 ,special rules = divid5ds 7,a7 ,individuals ,any divid5d allocat$ to any inve/m5t s]vices p>tn]%ip int]e/ %all n be treat$ z qualifi$ divid5d income = purposes ( section #a7;h74 7,b7 ,corporations ,no d$uction %all be all[$ "u section #bdc or #bde ) respect to any divid5d allocat$ to any inve/m5t s]vices p>tn]%ip int]e/4 7b7 ,dispositions ( p>tn]%ip int]e/s 7#a7 ,ga9 7,a7 ,9 g5]al ,any ga9 on ! disposition ( an inve/m5t s]vices p>tn]%ip int]e/ %all be-- 7i7 treat$ z ord9>y income1 & 7ii7 recogniz$ not)/&+ any o!r provision ( ?is subtitle4 7,b7 ,exceptions2 ,c]ta9 transf]s to *>ities & relat$ p]sons ,subp>agraph 7,a7 %all n apply to-- 7i7 a disposition by gift1 7ii7 a transf] at dea?1 or 7iii7 o!r disposition id5tifi$ by ! ,secret>y z a disposition ) respect to :i* x w\ld be inconsi/5t ) ! purposes ( ?is section to apply subp>agraph 7,a71 if su* gift1 transf]1 or o!r disposition is to an organization describ$ 9 section #agj7;b77#a77;,a7 7o!r ?an any organization describ$ 9 section #eji7;a77#c7 or any fund or acc\nt describ$ 9 section #diff7;d77#b77 or a p]son ) respect to :om ! transf]r$ int]e/ is an inve/m5t s]vices p>tn]%ip int]e/4 7#b7 ,loss ,any loss on ! disposition ( an inve/m5t s]vices p>tn]%ip int]e/ %all be treat$ z an ord9>y loss to ! ext5t ( ! excess 7if any7 (-- 7,a7 ! aggregate am\nt treat$ z ord9>y income "u subsection 7a7 ) respect to su* int]e/ = all p>tn]%ip taxable ye>s to :i* ?is section applies1 ov] 7,b7 ! aggregate am\nt treat$ z ord9>y loss "u subsection 7a7 ) respect to su* int]e/ = all p>tn]%ip taxable ye>s to :i* ?is section applies4 7#c7 ,election ) respect to c]ta9 ex*anges ,p>agraph 7#a77;,a77ii7 %all n apply to ! contribution ( an inve/m5t s]vices p>tn]%ip int]e/ to a p>tn]%ip 9 ex*ange = an int]e/ 9 su* p>tn]%ip if-- 7,a7 ! taxpay] makes an irrevocable election to treat ! p>tn]%ip int]e/ receiv$ 9 ! ex*ange z an inve/m5t s]vices p>tn]%ip int]e/1 & 7,b7 ! taxpay] agrees to comply ) su* report+ & recordkeep+ requirem5ts z ! ,secret>y may prescribe4 7#d7 ,di/ributions ( p>tn]%ip prop]ty 7,a7 ,9 g5]al ,9 ! case ( any di/ribution ( prop]ty by a p>tn]%ip ) respect to any inve/m5t s]vices p>tn]%ip int]e/ held by a p>tn]1 ! p>tn] receiv+ su* prop]ty %all recognize ga9 equal to ! excess 7if any7 (-- 7i7 ! fair m>ket value ( su* prop]ty at ! "t ( su* di/ribution1 ov] 7ii7 ! adju/$ basis ( su* prop]ty 9 ! h&s ( su* p>tn] 7det]m9$ )\t reg>d to subp>agraph 7,c774 7,b7 ,treatm5t ( ga9 z ord9>y income ,any ga9 recogniz$ by su* p>tn] "u subp>agraph 7,a7 %all be treat$ z ord9>y income to ! same ext5t & 9 ! same mann] z ! increase 9 su* p>tn]'s di/ributive %>e ( ! taxable income ( ! p>tn]%ip w\ld be treat$ "u subsection 7a7 if1 imm$iately prior to ! di/ribution1 ! p>tn]%ip _h sold ! di/ribut$ prop]ty at fair m>ket value & all ( ! ga9 f su* disposition 7 allocat$ to su* p>tn]4 ,= purposes ( apply+ p>agraphs 7#b7 & 7#c7 ( subsection 7a71 any ga9 treat$ z ord9>y income "u ?is subp>agraph %all be treat$ z an am\nt treat$ z ord9>y income "u subsection 7a77#a77;,a74 7,c7 ,adju/m5t ( basis ,9 ! case a di/ribution to :i* subp>agraph 7,a7 applies1 ! basis ( ! di/ribut$ prop]ty 9 ! h&s ( ! di/ributee p>tn] %all be ! fair m>ket value ( su* prop]ty4 7,d7 ,special rules ) respect to m]g]s1 divisions1 & te*nical t]m9ations ,9 ! case ( a taxpay] :i* satisfies requirem5ts simil> to ! requirem5ts ( subp>agraphs 7,a7 & 7,b7 ( p>agraph 7#c71 ?is p>agraph & p>agraph 7#a77;,a77ii7 %all n apply to ! di/ribution ( a p>tn]%ip int]e/ if su* di/ribution is 9 connection ) a contribution 7or deem$ contribution7 ( any prop]ty ( ! p>tn]%ip to :i* section #gba applies pursuant to a transaction describ$ 9 p>agraph 7#a77;,b7 or 7#b7 ( section #gjh7;b74 7c7 ,inve/m5t s]vices p>tn]%ip int]e/ ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m inve/m5t s]vices p>tn]%ip int]e/ means any int]e/ 9 an inve/m5t p>tn]%ip acquir$ or held by any p]son 9 connection ) ! conduct ( a trade or bus9ess describ$ 9 p>agraph 7#b7 by su* p]son 7or any p]son relat$ to su* p]son74 ,an int]e/ 9 an inve/m5t p>tn]%ip held by any p]son-- 7,a7 %all n be treat$ z an inve/m5t s]vices p>tn]%ip int]e/ = any p]iod be=e ! fir/ date on :i* x is s held 9 connection ) su* a trade or bus9ess1 7,b7 %all n cease to be an inve/m5t s]vices p>tn]%ip int]e/ m]ely because su* p]son holds su* int]e/ o!r ?an 9 connection ) su* a trade or bus9ess1 & 7,c7 %all be treat$ z an inve/m5t s]vices p>tn]%ip int]e/ if acquir$ f a relat$ p]son 9 ^: h&s su* int]e/ 0 an inve/m5t s]vices p>tn]%ip int]e/4 7#b7 ,bus9esses to :i* ?is section applies ,a trade or bus9ess is describ$ 9 ?is p>agraph if su* trade or bus9ess prim>ily involves ! p]=mance ( any ( ! foll[+ s]vices ) respect to assets held 7directly or indirectly7 by ! inve/m5t p>tn]%ip ref]r$ to 9 p>agraph 7#a73 7,a7 ,advis+ z to ! advisability ( inve/+ 91 pur*as+1 or sell+ any specifi$ asset4 7,b7 ,manag+1 acquir+1 or dispos+ ( any specifi$ asset4 7,c7 ,arrang+ f9anc+ ) respect to acquir+ specifi$ assets4 7,d7 ,any activity 9 support ( any s]vice describ$ 9 subp>agraphs 7,a7 ?r\gh 7,c74 7#c7 ,inve/m5t p>tn]%ip 7,a7 ,9 g5]al ,! t]m inve/m5t p>tn]%ip means any p>tn]%ip if1 at ! end ( any cal5d> qu>t] end+ aft] ,decemb] #ca1 #bjab-- 7i7 sub/antially all ( ! assets ( ! p>tn]%ip are specifi$ assets 7det]m9$ )\t reg>d to any section #aig intangible )9 ! mean+ ( section #aig7;d771 & 7ii7 m ?an half ( ! contribut$ capital ( ! p>tn]%ip is attributable to contributions ( prop]ty by "o or m p]sons 9 ex*ange = int]e/s 9 ! p>tn]%ip :i* 79 ! h&s ( su* p]sons7 con/itute prop]ty held = ! production ( income4 7,b7 ,special rules = det]m9+ if prop]ty held = ! production ( income ,except z o!rwise provid$ by ! ,secret>y1 = purposes ( det]m9+ :e!r any int]e/ 9 a p>tn]%ip con/itutes prop]ty held = ! production ( income "u subp>agraph 7,a77ii7-- 7i7 any election "u subsection 7e7 or 7f7 ( section #dge %all be disreg>d$1 & 7ii7 p>agraph 7#e77;,b7 %all n apply4 7,c7 ,antiabuse rules ,! ,secret>y may issue regulations or o!r guidance :i* prev5t ! avoidance ( ! purposes ( subp>agraph 7,a71 includ+ regulations or o!r guidance :i* treat conv]tible & cont+5t debt 7& o!r debt hav+ ! attributes ( equity7 z a capital int]e/ 9 ! p>tn]%ip4 7,d7 ,controll$ gr\ps ( entities 7i7 ,9 g5]al ,9 ! case ( a controll$ gr\p ( entities1 if an int]e/ 9 ! p>tn]%ip receiv$ 9 ex*ange = a contribution to ! capital ( ! p>tn]%ip by any memb] ( su* controll$ gr\p w\ld 79 ! h&s ( su* memb]7 con/itute prop]ty n held = ! production ( income1 !n any int]e/ 9 su* p>tn]%ip held by any memb] ( su* gr\p %all be treat$ = purposes ( subp>agraph 7,a7 z con/itut+ 79 ! h&s ( su* memb]7 prop]ty n held = ! production ( income4 7ii7 ,controll$ gr\p ( entities ,= purposes ( clause 7i71 ! t]m controll$ gr\p ( entities means a controll$ gr\p ( corporations z def9$ 9 section #aefc7;a77#a71 appli$ )\t reg>d to subsections 7a77#d7 & 7b77#b7 ( section #aefc4 ,a p>tn]%ip or any o!r entity 7o!r ?an a corporation7 %all be treat$ z a memb] ( a controll$ gr\p ( entities if su* entity is controll$ 7)9 ! mean+ ( section #ied7;d77#c77 by memb]s ( su* gr\p 7includ+ any entity treat$ z a memb] ( su* gr\p by reason ( ?is s5t5ce74 7#d7 ,specifi$ asset ,! t]m specifi$ asset means securities 7z def9$ 9 section #dge7;c77#b7 )\t reg>d to ! la/ s5t5ce !re(71 real e/ate held = r5tal or inve/m5t1 int]e/s 9 p>tn]%ips1 commodities 7z def9$ 9 section #dge7;e77#b771 ca% or ca% equival5ts1 or options or d]ivative contracts ) respect to any ( ! =ego+4 7#e7 ,relat$ p]sons 7,a7 ,9 g5]al ,a p]son %all be treat$ z relat$ to ano!r p]son if ! relation%ip betwe5 su* p]sons is describ$ 9 section #bfg7;b7 or #gjg7;b74 7,b7 ,attribution ( p>tn] s]vices ,any s]vice describ$ 9 p>agraph 7#b7 :i* is provid$ by a p>tn] ( a p>tn]%ip %all be treat$ z also provid$ by su* p>tn]%ip4 7d7 ,exception = c]ta9 capital int]e/s 7#a7 ,9 g5]al ,9 ! case ( any portion ( an inve/m5t s]vices p>tn]%ip int]e/ :i* is a qualifi$ capital int]e/1 all items ( ga9 & loss 7& any divid5ds7 :i* are allocat$ to su* qualifi$ capital int]e/ %all n be tak5 into acc\nt "u subsection 7a7 if-- 7,a7 allocations ( items are made by ! p>tn]%ip to su* qualifi$ capital int]e/ 9 ! same mann] z su* allocations are made to o!r qualifi$ capital int]e/s held by p>tn]s :o d n provide any s]vices describ$ 9 subsection 7c77#b7 & :o are n relat$ to ! p>tn] hold+ ! qualifi$ capital int]e/1 & 7,b7 ! allocations made to su* o!r int]e/s are significant comp>$ to ! allocations made to su* qualifi$ capital int]e/4 7#b7 ,au?ority to provide exceptions to allocation requirem5ts ,to ! ext5t provid$ by ! ,secret>y 9 regulations or o!r guidance-- 7,a7 ,allocations to portion ( qualifi$ capital int]e/ ,p>agraph 7#a7 may be appli$ sep>ately ) respect to a portion ( a qualifi$ capital int]e/4 7,b7 ,no or insignificant allocations to nons]vice provid]s ,9 any case 9 :i* ! requirem5ts ( p>agraph 7#a77;,b7 are n satisfi$1 items ( ga9 & loss 7& any divid5ds7 %all n be tak5 into acc\nt "u subsection 7a7 to ! ext5t t su* items are prop]ly allocable "u su* regulations or o!r guidance to qualifi$ capital int]e/s4 7,c7 ,allocations to s]vice provid]s' qualifi$ capital int]e/s :i* are less ?an o!r allocations ,allocations %all n be treat$ z fail+ to meet ! requirem5t ( p>agraph 7#a77;,a7 m]ely because ! allocations to ! qualifi$ capital int]e/ repres5t a l[] return ?an ! allocations made to ! o!r qualifi$ capital int]e/s ref]r$ to 9 su* p>agraph4 7#c7 ,special rule = *anges 9 s]vices & capital contributions ,9 ! case ( an int]e/ 9 a p>tn]%ip :i* 0 n an inve/m5t s]vices p>tn]%ip int]e/ & :i*1 by reason ( a *ange 9 ! s]vices ) respect to assets held 7directly or indirectly7 by ! p>tn]%ip or by reason ( a *ange 9 ! capital contributions to su* p>tn]%ip1 becomes an inve/m5t s]vices p>tn]%ip int]e/1 ! qualifi$ capital int]e/ ( ! hold] ( su* p>tn]%ip int]e/ imm$iately aft] su* *ange %all n1 = purposes ( ?is subsection1 be less ?an ! fair m>ket value ( su* int]e/ 7det]m9$ imm$iately be=e su* *ange74 7#d7 ,special rule = ti]$ p>tn]%ips ,except z o!rwise provid$ by ! ,secret>y1 9 ! case ( ti]$ p>tn]%ips1 all items :i* are allocat$ 9 a mann] :i* meets ! requirem5ts ( p>agraph 7#a7 to qualifi$ capital int]e/s 9 a l[]-ti] p>tn]%ip %all reta9 su* "* to ! ext5t allocat$ on ! basis ( qualifi$ capital int]e/s 9 any upp]-ti] p>tn]%ip4 7#e7 ,exception = no-self-*>g$ c>ry & managem5t fee provisions ,except z o!rwise provid$ by ! ,secret>y1 an int]e/ %all n fail to be treat$ z satisfy+ ! requirem5t ( p>agraph 7#a77;,a7 m]ely because ! allocations made by ! p>tn]%ip to su* int]e/ d n reflect ! co/ ( s]vices describ$ 9 subsection 7c77#b7 :i* are provid$ 7directly or indirectly7 to ! p>tn]%ip by ! hold] ( su* int]e/ 7or a relat$ p]son74 7#f7 ,special rule = dispositions ,9 ! case ( any inve/m5t s]vices p>tn]%ip int]e/ any portion ( :i* is a qualifi$ capital int]e/1 subsection 7b7 %all n apply to s mu* ( any ga9 or loss z be>s ! same proportion to ! entire am\nt ( su* ga9 or loss z-- 7,a7 ! di/ributive %>e ( ga9 or loss t w\ld h be5 allocat$ to ! qualifi$ capital int]e/ 7consi/5t ) ! requirem5ts ( p>agraph 7#a77 if ! p>tn]%ip _h sold all ( its assets at fair m>ket value imm$iately be=e ! disposition1 be>s to 7,b7 ! di/ributive %>e ( ga9 or loss t w\ld h be5 s allocat$ to ! inve/m5t s]vices p>tn]%ip int]e/ ( :i* su* qualifi$ capital int]e/ is a "p4 7#g7 ,qualifi$ capital int]e/ ,= purposes ( ?is subsection-- 7,a7 ,9 g5]al ,! t]m qualifi$ capital int]e/ means s mu* ( a p>tn]'s int]e/ 9 ! capital ( ! p>tn]%ip z is attributable to-- 7i7 ! fair m>ket value ( any money or o!r prop]ty contribut$ to ! p>tn]%ip 9 ex*ange = su* int]e/ 7det]m9$ )\t reg>d to section #geb7;a771 7ii7 any am\nts :i* h be5 includ$ 9 gross income "u section #hc ) respect to ! transf] ( su* int]e/1 & 7iii7 ! excess 7if any7 (-- 7,i7 any items ( income & ga9 tak5 into acc\nt "u section #gjb ) respect to su* int]e/1 ov] 7,,ii7 any items ( d$uction & loss s tak5 into acc\nt4 7,b7 ,adju/m5t to qualifi$ capital int]e/ 7i7 ,di/ributions & losses ,! qualifi$ capital int]e/ %all be r$uc$ by di/ributions f ! p>tn]%ip ) respect to su* int]e/ & by ! excess 7if any7 ( ! am\nt describ$ 9 subp>agraph 7,a77iii77,,ii7 ov] ! am\nt describ$ 9 subp>agraph 7,a77iii77,i74 7ii7 ,special rule = contributions ( prop]ty ,9 ! case ( any contribution ( prop]ty describ$ 9 subp>agraph 7,a77i7 ) respect to :i* ! fair m>ket value ( su* prop]ty is n equal to ! adju/$ basis ( su* prop]ty imm$iately be=e su* contribution1 prop] adju/m5ts %all be made to ! qualifi$ capital int]e/ to take into acc\nt su* diff]5ce consi/5t ) su* regulations or o!r guidance z ! ,secret>y may provide4 7,c7 ,te*nical t]m9ations1 etc41 disreg>d$ ,no increase or decrease 9 ! qualifi$ capital int]e/ ( any p>tn] %all result f a t]m9ation1 m]g]1 consolidation1 or division describ$ 9 section #gjh1 or any simil> transaction4 7#h7 ,treatm5t ( c]ta9 loans 7,a7 ,proce$s ( p>tn]%ip loans n treat$ z qualifi$ capital int]e/ ( s]vice provid+ p>tn]s ,= purposes ( ?is subsection1 an inve/m5t s]vices p>tn]%ip int]e/ %all n be treat$ z a qualifi$ capital int]e/ to ! ext5t t su* int]e/ is acquir$ 9 connection ) ! proce$s ( any loan or o!r advance made or gu>ante$1 directly or indirectly1 by any o!r p>tn] or ! p>tn]%ip 7or any p]son relat$ to any su* o!r p>tn] or ! p>tn]%ip74 ,! prec$+ s5t5ce %all n apply to ! ext5t ! loan or o!r advance is repaid be=e ,janu>y #a1 #bjac unless su* repaym5t is made ) ! proce$s ( a loan or o!r advance describ$ 9 ! prec$+ s5t5ce4 7,b7 ,r$uction 9 allocations to qualifi$ capital int]e/s = loans f nons]vice-provid+ p>tn]s to ! p>tn]%ip ,= purposes ( ?is subsection1 any loan or o!r advance to ! p>tn]%ip made or gu>ante$1 directly or indirectly1 by a p>tn] n provid+ s]vices describ$ 9 subsection 7c77#b7 to ! p>tn]%ip 7or any p]son relat$ to su* p>tn]7 %all be tak5 into acc\nt 9 det]m9+ ! qualifi$ capital int]e/s ( ! p>tn]s 9 ! p>tn]%ip4 7e7 ,o!r income & ga9 9 connection ) inve/m5t managem5t s]vices 7#a7 ,9 g5]al ,if-- 7,a7 a p]son p]=ms 7directly or indirectly7 inve/m5t managem5t s]vices = any inve/m5t entity1 7,b7 su* p]son holds 7directly or indirectly7 a disqualifi$ int]e/ ) respect to su* entity1 & 7,c7 ! value ( su* int]e/ 7or paym5ts !reund]7 is sub/antially relat$ to ! am\nt ( income or ga9 7:e!r or n realiz$7 f ! assets ) respect to :i* ! inve/m5t managem5t s]vices are p]=m$1 any income or ga9 ) respect to su* int]e/ %all be treat$ z ord9>y income4 ,rules simil> to ! rules ( subsections 7a77#e7 & 7d7 %all apply = purposes ( ?is subsection4 7#b7 ,def9itions ,= purposes ( ?is subsection-- 7,a7 ,disqualifi$ int]e/ 7i7 ,9 g5]al ,! t]m disqualifi$ int]e/ means1 ) respect to any inve/m5t entity-- 7,i7 any int]e/ 9 su* entity o!r ?an indebt$ness1 7,,ii7 conv]tible or cont+5t debt ( su* entity1 7,,iii7 any option or o!r "r to acquire prop]ty describ$ 9 subclause 7,i7 or 7,,ii71 & 7,,iv7 any d]ivative in/rum5t ent]$ into 7directly or indirectly7 ) su* entity or any inve/or 9 su* entity4 7ii7 ,exceptions ,su* t]m %all n include-- 7,i7 a p>tn]%ip int]e/1 7,,ii7 except z provid$ by ! ,secret>y1 any int]e/ 9 a taxable corporation1 & 7,,iii7 except z provid$ by ! ,secret>y1 /ock 9 an ,s corporation4 7,b7 ,taxable corporation ,! t]m taxable corporation means-- 7i7 a dome/ic ,c corporation1 or 7ii7 a =eign corporation sub/antially all ( ! income ( :i* is-- 7,i7 effectively connect$ ) ! conduct ( a trade or bus9ess 9 ! ,unit$ ,/ates1 or 7,,ii7 subject to a compreh5sive =eign income tax 7z def9$ 9 section #deg;,a7d77#b774 7,c7 ,inve/m5t managem5t s]vices ,! t]m inve/m5t managem5t s]vices means a sub/antial quantity ( any ( ! s]vices describ$ 9 subsection 7c77#b74 7,d7 ,inve/m5t entity ,! t]m inve/m5t entity means any entity :i*1 if x 7 a p>tn]%ip1 w\ld be an inve/m5t p>tn]%ip4 7f7 ,regulations ,! ,secret>y %all prescribe su* regulations or o!r guidance z is necess>y or appropriate to c>ry out ! purposes ( ?is section1 includ+ regulations or o!r guidance to-- 7#a7 provide modifications to ! application ( ?is section 7includ+ treat+ relat$ p]sons z n relat$ to "o ano!r7 to ! ext5t su* modification is consi/5t ) ! purposes ( ?is section1 & 7#b7 coord9ate ?is section ) ! o!r provisions ( ?is title4 7g7 ,cross ref]5ce ,= #dj p]c5t p5alty on c]ta9 und]paym5ts due to ! avoidance ( ?is section1 see section #fffb4 4 7b7 ,application ( section #gea to indirect dispositions ( inve/m5t s]vices p>tn]%ip int]e/s 7#a7 ,9 g5]al ,subsection 7a7 ( section #gea ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ or at ! end ( p>agraph 7#a71 by ins]t+ or at ! end ( p>agraph 7#b71 & by ins]t+ aft] p>agraph 7#b7 ! foll[+ new p>agraph3 7#c7 inve/m5t s]vices p>tn]%ip int]e/s held by ! p>tn]%ip1 4 7#b7 ,c]ta9 di/ributions treat$ z sales or ex*anges ,subp>agraph 7,a7 ( section #gea7;b77#a7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ or at ! end ( clause 7i71 by ins]t+ or at ! end ( clause 7ii71 & by ins]t+ aft] clause 7ii7 ! foll[+ new clause3 7iii7 inve/m5t s]vices p>tn]%ip int]e/s held by ! p>tn]%ip1 4 7#c7 ,application ( special rules 9 ! case ( ti]$ p>tn]%ips ,subsection 7f7 ( section #gea ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ or at ! end ( p>agraph 7#a71 by ins]t+ or at ! end ( p>agraph 7#b71 & by ins]t+ aft] p>agraph 7#b7 ! foll[+ new p>agraph3 7#c7 inve/m5t s]vices p>tn]%ip int]e/s held by ! p>tn]%ip1 4 7#d7 ,inve/m5t s]vices p>tn]%ip int]e/s2 qualifi$ capital int]e/s ,section #gea ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7g7 ,inve/m5t s]vices p>tn]%ip int]e/s ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m inve/m5t s]vices p>tn]%ip int]e/ has ! mean+ giv5 su* t]m by section #gaj7;c74 7#b7 ,adju/m5ts = qualifi$ capital int]e/s ,! am\nt to :i* subsection 7a7 applies by reason ( p>agraph 7#c7 !re( %all n include s mu* ( su* am\nt z is attributable to any portion ( ! inve/m5t s]vices p>tn]%ip int]e/ :i* is a qualifi$ capital int]e/ 7det]m9$ "u rules simil> to ! rules ( section #gaj7;d774 7#c7 ,recognition ( ga9s ,any ga9 ) respect to :i* subsection 7a7 applies by reason ( p>agraph 7#c7 !re( %all be recogniz$ not)/&+ any o!r provision ( ?is title4 7#d7 ,coord9ation ) inv5tory items ,an inve/m5t s]vices p>tn]%ip int]e/ held by ! p>tn]%ip %all n be treat$ z an inv5tory item ( ! p>tn]%ip4 7#e7 ,prev5tion ( d\ble c\nt+ ,"u regulations or o!r guidance prescrib$ by ! ,secret>y1 subsection 7a77#c7 %all n apply ) respect to any am\nt to :i* section #gaj applies4 4 7c7 ,treatm5t = purposes ( section #ggjd ,subsection 7d7 ( section #ggjd ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new p>agraph3 7#f7 ,income f c]ta9 c>ri$ int]e/s n qualifi$ 7,a7 ,9 g5]al ,specifi$ c>ri$ int]e/ income %all n be treat$ z qualify+ income4 7,b7 ,specifi$ c>ri$ int]e/ income ,= purposes ( ?is p>agraph-- 7i7 ,9 g5]al ,! t]m specifi$ c>ri$ int]e/ income means-- 7,i7 any item ( income or ga9 allocat$ to an inve/m5t s]vices p>tn]%ip int]e/ 7z def9$ 9 section #gaj7;c77 held by ! p>tn]%ip1 7,,ii7 any ga9 on ! disposition ( an inve/m5t s]vices p>tn]%ip int]e/ 7z s def9$7 or a p>tn]%ip int]e/ to :i* 79 ! h&s ( ! p>tn]%ip7 section #gea applies1 & 7,,iii7 any income or ga9 tak5 into acc\nt by ! p>tn]%ip "u subsection 7b77#d7 or 7e7 ( section #gaj4 7ii7 ,exception = qualifi$ capital int]e/s ,a rule simil> to ! rule ( section #gaj7;d7 %all apply = purposes ( clause 7i74 7,c7 ,coord9ation ) o!r provisions ,subp>agraph 7,a7 %all n apply to any item describ$ 9 p>agraph 7#a77;,e7 7or s mu* ( p>agraph 7#a77;,f7 z relates to p>agraph 7#a77;,e774 7,d7 ,special rules = c]ta9 p>tn]%ips 7i7 ,c]ta9 p>tn]%ips own$ by real e/ate inve/m5t tru/s ,subp>agraph 7,a7 %all n apply 9 ! case ( a p>tn]%ip :i* meets ea* ( ! foll[+ requirem5ts3 7,i7 ,su* p>tn]%ip is treat$ z publicly trad$ "u ?is section solely by reason ( int]e/s 9 su* p>tn]%ip be+ conv]tible into int]e/s 9 a real e/ate inve/m5t tru/ :i* is publicly trad$4 7,,ii7 ,fifty p]c5t or m ( ! capital & pr(its int]e/s ( su* p>tn]%ip are own$1 directly or indirectly1 at all times dur+ ! taxable ye> by su* real e/ate inve/m5t tru/ 7det]m9$ ) ! application ( section #bfg7;c774 7,,iii7 ,su* p>tn]%ip meets ! requirem5ts ( p>agraphs 7#b71 7#c71 & 7#d7 ( section #hef7;c74 7ii7 ,c]ta9 p>tn]%ips own+ o!r publicly trad$ p>tn]%ips ,subp>agraph 7,a7 %all n apply 9 ! case ( a p>tn]%ip :i* meets ea* ( ! foll[+ requirem5ts3 7,i7 ,sub/antially all ( ! assets ( su* p>tn]%ip consi/ ( int]e/s 9 "o or m publicly trad$ p>tn]%ips 7det]m9$ )\t reg>d to subsection 7b77#b774 7,,ii7 ,sub/antially all ( ! income ( su* p>tn]%ip is ord9>y income or section #abca ga9 7z def9$ 9 section #abca7;a77#c774 7,e7 ,transitional rule ,subp>agraph 7,a7 %all n apply to any taxable ye> ( ! p>tn]%ip beg9n+ be=e ! date :i* is #aj ye>s aft] ,janu>y #a1 #bjac4 4 7d7 ,imposition ( p5alty on und]paym5ts 7#a7 ,9 g5]al ,subsection 7b7 ( section #fffb ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ aft] p>agraph 7#g7 ! foll[+ new p>agraph3 7#h7 ,! application ( section #gaj7;e7 or ! regulations or o!r guidance prescrib$ "u section #gaj7;h7 to prev5t ! avoidance ( ! purposes ( section #gaj4 4 7#b7 ,am\nt ( p5alty 7,a7 ,9 g5]al ,section #fffb ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7k7 ,increase 9 p5alty 9 case ( prop]ty transf]r$ = inve/m5t managem5t s]vices ,9 ! case ( any portion ( an und]paym5t to :i* ?is section applies by reason ( subsection 7b77#h71 subsection 7a7 %all be appli$ ) respect to su* portion by sub/itut+ #dj p]c5t = #bj p]c5t4 4 7,b7 ,con=m+ am5dm5t ,subp>agraph 7,b7 ( section #fffb;,a7e77#b7 is am5d$ by /rik+ or 7i7 & ins]t+ 1 7i71 or 7k74 7#c7 ,special rules = application ( reasonable cause exception ,subsection 7c7 ( section #fffd is am5d$-- 7,a7 by r$esignat+ p>agraphs 7#c7 & 7#d7 z p>agraphs 7#d7 & 7#e71 respectively2 7,b7 by /rik+ p>agraph 7#c7 9 p>agraph 7#e77;,a71 z s r$esignat$1 & ins]t+ p>agraph 7#d72 & 7,c7 by ins]t+ aft] p>agraph 7#b7 ! foll[+ new p>agraph3 7#c7 ,special rule = und]paym5ts attributable to inve/m5t managem5t s]vices 7,a7 ,9 g5]al ,p>agraph 7#a7 %all n apply to any portion ( an und]paym5t to :i* section #fffb applies by reason ( subsection 7b77#h7 unless-- 7i7 ! relevant facts affect+ ! tax treatm5t ( ! item are adequately disclos$1 7ii7 !re is or 0 sub/antial au?ority = su* treatm5t1 & 7iii7 ! taxpay] reasonably believ$ t su* treatm5t 0 m likely ?an n ! prop] treatm5t4 7,b7 ,rules relat+ to reasonable belief ,rules simil> to ! rules ( subsection 7d77#c7 %all apply = purposes ( subp>agraph 7,a77iii74 4 7e7 ,income & loss f inve/m5t s]vices p>tn]%ip int]e/s tak5 into acc\nt 9 det]m9+ net e>n+s f self-,employm5t 7#a7 ,int]nal rev5ue code 7,a7 ,9 g5]al ,section #adjb7;a7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ & at ! end ( p>agraph 7#af71 by /rik+ ! p]iod at ! end ( p>agraph 7#ag7 & ins]t+ 2 &1 & by ins]t+ aft] p>agraph 7#ag7 ! foll[+ new p>agraph3 7#ah7 not)/&+ ! prec$+ provisions ( ?is subsection1 9 ! case ( any individual engag$ 9 ! trade or bus9ess ( provid+ s]vices describ$ 9 section #gaj7;c77#b7 ) respect to any entity1 inve/m5t s]vices p>tn]%ip income or loss 7z def9$ 9 subsection 7m77 ( su* individual ) respect to su* entity %all be tak5 into acc\nt 9 det]m9+ ! net e>n+s f self-employm5t ( su* individual4 4 7,b7 ,inve/m5t s]vices p>tn]%ip income or loss ,section #adjb ( ! ,int]nal ,rev5ue ,code is am5d$ by add+ at ! end ! foll[+ new subsection3 7m7 ,inve/m5t s]vices p>tn]%ip income or loss ,= purposes ( subsection 7a7-- 7#a7 ,9 g5]al ,! t]m inve/m5t s]vices p>tn]%ip income or loss means1 ) respect to any inve/m5t s]vices p>tn]%ip int]e/ 7z def9$ 9 section #gaj7;c771 ! net (-- 7,a7 ! am\nts treat$ z ord9>y income or ord9>y loss "u subsections 7b7 & 7e7 ( section #gaj ) respect to su* int]e/1 7,b7 all items ( income1 ga91 loss1 & d$uction allocat$ to su* int]e/1 & 7,c7 ! am\nts treat$ z realiz$ f ! sale or ex*ange ( prop]ty o!r ?an a capital asset "u section #gea ) respect to su* int]e/4 7#b7 ,exception = qualifi$ capital int]e/s ,a rule simil> to ! rule ( section #gaj7;d7 %all apply = purposes ( apply+ p>agraph 7#a77;,b77ii74 4 7#b7 ,social security ,act ,section #baa7;a7 ( ! ,social ,security ,act is am5d$ by /rik+ & at ! end ( p>agraph 7#ae71 by /rik+ ! p]iod at ! end ( p>agraph 7#af7 & ins]t+ 2 &1 & by ins]t+ aft] p>agraph 7#af7 ! foll[+ new p>agraph3 7#ag7 ,not)/&+ ! prec$+ provisions ( ?is subsection1 9 ! case ( any individual engag$ 9 ! trade or bus9ess ( provid+ s]vices describ$ 9 section #gaj7;c77#b7 ( ! ,int]nal ,rev5ue ,code ( #aihf ) respect to any entity1 inve/m5t s]vices p>tn]%ip income or loss 7z def9$ 9 section #adjb7m7 ( su* ,code7 %all be tak5 into acc\nt 9 det]m9+ ! net e>n+s f self-employm5t ( su* individual4 4 7f7 ,con=m+ am5dm5ts 7#a7 ,subsection 7d7 ( section #gca ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ section #gaj7;b77#d7 7relat+ to di/ributions ( p>tn]%ip prop]ty71 aft] to ! ext5t o!rwise provid$ by4 7#b7 ,section #gda ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ or section #gaj 7relat+ to special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips7 be=e ! p]iod at ! end4 7#c7 ,! table ( sections = "p ,i ( sub*apt] ,k ( *apt] #a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new item3 ,sec4 #gaj4 ,special rules = p>tn]s provid+ inve/m5t managem5t s]vices to p>tn]%ips4 4 7g7 ,effective date 7#a7 ,9 g5]al ,except z o!rwise provid$ 9 ?is subsection1 ! am5dm5ts made by ?is section %all apply to taxable ye>s end+ aft] ,decemb] #ca1 #bjab4 7#b7 ,p>tn]%ip taxable ye>s :i* include effective date ,9 apply+ section #gaj7;a7 ( ! ,int]nal ,rev5ue ,code ( #aihf 7z add$ by ?is section7 9 ! case ( any p>tn]%ip taxable ye> :i* includes ,janu>y #a1 #bjac1 ! am\nt ( ! net income ref]r$ to 9 su* section %all be treat$ z be+ ! less] ( ! net income = ! entire p>tn]%ip taxable ye> or ! net income det]m9$ by only tak+ into acc\nt items attributable to ! portion ( ! p>tn]%ip taxable ye> :i* is aft] su* date4 7#c7 ,dispositions ( p>tn]%ip int]e/s 7,a7 ,9 g5]al ,section #gaj7;b7 ( su* ,code 7z add$ by ?is section7 %all apply to dispositions & di/ributions aft] ,decemb] #ca1 #bjab4 7,b7 ,indirect dispositions ,! am5dm5ts made by subsection 7b7 %all apply to transactions aft] ,decemb] #ca1 #bjab4 7#d7 ,o!r income & ga9 9 connection ) inve/m5t managem5t s]vices ,section #gaj7;e7 ( su* ,code 7z add$ by ?is section7 %all take effect on ,janu>y #a1 #bjac4 ,c ,dual capacity taxpay]s #bba4 ,modifications ( =eign tax cr$it rules applicable to dual capacity taxpay]s 7a7 ,9 g5]al ,section #ija ( ! ,int]nal ,rev5ue ,code ( #aihf 7relat+ to cr$it = taxes ( =eign c\ntries & ( possessions ( ! ,unit$ ,/ates7 is am5d$ by r$esignat+ subsection 7n7 z subsection 7o7 & by ins]t+ aft] subsection 7m7 ! foll[+ new subsection3 7n7 ,special rules relat+ to dual capacity taxpay]s 7#a7 ,g5]al rule ,not)/&+ any o!r provision ( ?is *apt]1 any am\nt paid or accru$ by a dual capacity taxpay] or any memb] ( ! worldwide affiliat$ gr\p ( :i* su* dual capacity taxpay] is also a memb] to any =eign c\ntry or to any possession ( ! ,unit$ ,/ates = any p]iod %all n be consid]$ a tax to ! ext5t su* am\nt exce$s ! am\nt 7det]m9$ 9 accordance ) regulations7 :i* w\ld h be5 requir$ to be paid if ! taxpay] 7 n a dual capacity taxpay]4 7#b7 ,dual capacity taxpay] ,= purposes ( ?is subsection1 ! t]m dual capacity taxpay] means1 ) respect to any =eign c\ntry or possession ( ! ,unit$ ,/ates1 a p]son :o-- 7,a7 is subject to a levy ( su* c\ntry or possession1 & 7,b7 receives 7or w receive7 directly or indirectly a specific economic b5efit 7z det]m9$ 9 accordance ) regulations7 f su* c\ntry or possession4 7#c7 ,regulations ,! ,secret>y may issue su* regulations or o!r guidance z is necess>y or appropriate to c>ry out ! purposes ( ?is subsection4 4 7b7 ,contr>y treaty obligations upheld ,! am5dm5ts made by ?is section %all n apply to ! ext5t contr>y to any treaty obligation ( ! ,unit$ ,/ates4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to am\nts t1 if su* am\nts 7 an am\nt ( tax paid or accru$1 w\ld be consid]$ paid or accru$ 9 taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjab4 #bbb4 ,sep>ate basket treatm5t taxes paid on =eign oil & gas income 7a7 ,sep>ate basket = =eign tax cr$it ,p>agraph 7#a7 ( section #ijd7;d7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ & at ! end ( subp>agraph 7,a71 by /rik+ ! p]iod at ! end ( subp>agraph 7,b7 & ins]t+ 1 &1 & by add+ at ! end ! foll[+3 7,c7 comb9$ =eign oil & gas income 7z def9$ 9 section #ijg7;b77#a774 4 7b7 ,coord9ation ,section #ijd7;d77#b7 ( su* ,code is am5d$ by r$esignat+ subp>agraphs 7,j7 & 7,k7 z subp>agraphs 7,k7 & 7,l7 & by ins]t+ aft] subp>agraph 7,i7 ! foll[+3 7,j7 ,coord9ation ) comb9$ =eign oil & gas income ,= purposes ( ?is section1 passive category income & g5]al category income %all n include comb9$ =eign oil & gas income 7z def9$ 9 section #ijg7;b77#a774 4 7c7 ,con=m+ am5dm5ts 7#a7 ,section #ijg7;a7 is h]eby repeal$4 7#b7 ,section #ijg7;c77#d7 is h]eby repeal$4 7#c7 ,section #ijg7;f7 is h]eby repeal$4 7d7 ,effective dates 7#a7 ,9 g5]al ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjab4 7#b7 ,transitional rules 7,a7 ,c>ryov]s ,any unus$ =eign oil & gas taxes :i* "u section #ijg7;f7 ( su* ,code 7z 9 effect be=e ! am5dm5t made by subsection 7c77#c77 w\ld h be5 all[able z a c>ryov] to ! taxpay]'s fir/ taxable ye> beg9n+ aft] ,decemb] #ca1 #bjab 7)\t reg>d to ! limitation ( p>agraph 7#b7 ( su* section #ijg7;f7 = fir/ taxable ye>7 %all be all[$ z c>ryov]s "u section #ijd7;c7 ( su* ,code 9 ! same mann] z if su* taxes 7 unus$ taxes "u su* section #ijd7;c7 ) respect to =eign oil & gas extraction income4 7,b7 ,losses ,! am5dm5t made by subsection 7c77#b7 %all n apply to =eign oil & gas extraction losses aris+ 9 taxable ye>s beg9n+ on or be=e ! date ( ! enactm5t ( ?is ,act4 ,d ,close ,exclusion ( ,=eign-,e>n$ ,income ,loophole #bca4 ,repeal ( =eign e>n$ income exclusion 7a7 ,9 g5]al ,subsection 7a7 ( section #iaa ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ = any taxable ye>-- & all t foll[s ?r\gh ! end & ins]t+ = any taxable ye> ! h\s+ co/ am\nt ( su* individual44 7b7 ,con=m+ am5dm5ts 7#a7 ,subsection 7f7 ( section #hf ( su* ,code is am5d$ by ins]t+ & at ! end ( p>agraph 7#b71 by /rik+ 1 & at ! end ( p>agraph 7#c7 & ins]t+ a p]iod1 & by /rik+ p>agraph 7#d74 7#b7 ,section #adja7;a7 ( su* ,code is am5d$ by /rik+ p>agraph 7#aa74 7#c7 7,a7 ,clause 7i7 ( section #adaa7;a77#a77;,b7 ( su* ,code is am5d$ by /rik+ modifi$4 7,b7 ,section #adaa ( su* ,code is am5d$ by /rik+ subsection 7d7 & by r$esignat+ subsection 7e7 z subsection 7d74 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 ,e ,close ,s ,corporation ,loophole #bda4 ,employm5t tax treatm5t ( pr(essional s]vice bus9esses 7a7 ,9 g5]al ,section #adjb ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7m7 ,special rules = pr(essional s]vice bus9esses 7#a7 ,%>ehold]s provid+ s]vices to specifi$ s corporations 7,a7 ,9 g5]al ,9 ! case ( an applicable %>ehold] :o provides sub/antial s]vices ) respect to a pr(essional s]vice bus9ess ref]r$ to 9 subp>agraph 7,c7 ( a specifi$ ,s corporation-- 7i7 su* %>ehold] %all be treat$ z engag$ 9 ! trade or bus9ess ( su* pr(essional s]vice bus9ess ) respect to items ( income or loss describ$ 9 section #acff :i* are attributable to su* bus9ess1 & 7ii7 su* %>ehold]'s net e>n+s f self-employm5t %all include su* %>ehold]'s pro rata %>e ( su* items ( income or loss1 except t 9 comput+ su* pro rata %>e ( su* items ! exceptions provid$ 9 subsection 7a7 %all apply4 7,b7 ,treatm5t ( family memb]s ,except z o!rwise provid$ by ! ,secret>y1 ! applicable %>ehold]'s pro rata %>e ( items ref]r$ to 9 subp>agraph 7,a7 %all be increas$ by ! pro rata %>e ( su* items ( ea* memb] ( su* applicable %>ehold]'s family 7)9 ! mean+ ( section #cah7;a77#a77 :o does n provide sub/antial s]vices ) respect to su* pr(essional s]vice bus9ess4 7,c7 ,specifi$ s corporation ,= purposes ( ?is subsection1 ! t]m specifi$ ,s corporation means-- 7i7 any ,s corporation :i* is a p>tn] 9 a p>tn]%ip :i* is engag$ 9 a pr(essional s]vice bus9ess if sub/antially all ( ! activities ( su* ,s corporation are p]=m$ 9 connection ) su* p>tn]%ip1 & 7ii7 any o!r ,s corporation :i* is engag$ 9 a pr(essional s]vice bus9ess if #ge p]c5t or m ( ! gross income ( su* bus9ess is attributable to s]vice ( #c or few] %>ehold]s ( su* corporation4 7,d7 ,applicable %>ehold] ,= purposes ( ?is p>agraph1 ! t]m applicable %>ehold] means any %>ehold] ^: modifi$ adju/$ gross income = ! taxable ye> exce$s-- 7i7 9 ! case ( a %>ehold] mak+ a jo9t return "u section #fjac or a surviv+ sp\se 7z def9$ 9 section #b7;a771 #bej1jjj1 7ii7 9 ! case ( a m>ri$ %>ehold] 7z def9$ 9 section #ggjc7 fil+ a sep>ate return1 half ( ! doll> am\nt det]m9$ "u clause 7i71 & 7iii7 9 any o!r case1 #bjj1jjj4 7#b7 ,p>tn]s 7,a7 ,9 g5]al ,9 ! case ( any p>tn]%ip :i* is engag$ 9 a pr(essional s]vice bus9ess1 subsection 7a77#ac7 %all n apply to any applicable p>tn] :o provides sub/antial s]vices ) respect to su* pr(essional s]vice bus9ess4 7,b7 ,applicable p>tn] ,= purposes ( ?is p>agraph1 ! t]m applicable p>tn] means any p>tn] ^: modifi$ adju/$ gross income = ! taxable ye> exce$s-- 7i7 9 ! case ( a p>tn] mak+ a jo9t return "u section #fjac or a surviv+ sp\se 7z def9$ 9 section #b7;a771 #bej1jjj1 7ii7 9 ! case ( a m>ri$ p>tn] 7z def9$ 9 section #ggjc7 fil+ a sep>ate return1 half ( ! doll> am\nt det]m9$ "u clause 7i71 & 7iii7 9 any o!r case1 #bjj1jjj4 7#c7 ,pr(essional s]vice bus9ess ,= purposes ( ?is subsection1 ! t]m pr(essional s]vice bus9ess means any trade or bus9ess 7or portion !re(7 provid+ s]vices 9 ! fields ( heal?1 law1 lobby+1 eng9e]+1 ar*itecture1 acc\nt+1 actu>ial sci5ce1 p]=m+ arts1 consult+1 a?letics1 inve/m5t advice or managem5t1 or brok]age s]vices4 7#d7 ,modifi$ adju/$ gross income ,= purposes ( ?is subsection1 ! t]m modifi$ adju/$ gross income means adju/$ gross income-- 7,a7 det]m9$ )\t reg>d to any d$uction all[$ "u section #afd7;f71 & 7,b7 increas$ by ! am\nt exclud$ f gross income "u section #iaa7;a77#a74 7#e7 ,regulations ,! ,secret>y %all prescribe su* regulations z may be necess>y or appropriate to c>ry out ! purposes ( ?is subsection1 includ+ regulations :i* prev5t ! avoidance ( ! purposes ( ?is subsection ?r\gh ti]$ entities or o!rwise4 7#f7 ,cross ref]5ce ,= employm5t tax treatm5t ( wages paid to %>ehold]s ( ,s corporations1 see subtitle ,c4 4 7b7 ,con=m+ am5dm5t ,section #baa ( ! ,social ,security ,act is am5d$ by add+ at ! end ! foll[+ new subsection3 7l7 ,special rules = pr(essional s]vice bus9esses 7#a7 ,%>ehold]s provid+ s]vices to specifi$ s corporations 7,a7 ,9 g5]al ,9 ! case ( an applicable %>ehold] :o provides sub/antial s]vices ) respect to a pr(essional s]vice bus9ess ref]r$ to 9 subp>agraph 7,c7 ( a specifi$ ,s corporation-- 7i7 su* %>ehold] %all be treat$ z engag$ 9 ! trade or bus9ess ( su* pr(essional s]vice bus9ess ) respect to items ( income or loss describ$ 9 section #acff ( ! ,int]nal ,rev5ue ,code ( #aihf :i* are attributable to su* bus9ess1 & 7ii7 su* %>ehold]'s net e>n+s f self-employm5t %all include su* %>ehold]'s pro rata %>e ( su* items ( income or loss1 except t 9 comput+ su* pro rata %>e ( su* items ! exceptions provid$ 9 subsection 7a7 %all apply4 7,b7 ,treatm5t ( family memb]s ,except z o!rwise provid$ by ! ,secret>y ( ! ,treasury1 ! applicable %>ehold]'s pro rata %>e ( items ref]r$ to 9 subp>agraph 7,a7 %all be increas$ by ! pro rata %>e ( su* items ( ea* memb] ( su* applicable %>ehold]'s family 7)9 ! mean+ ( section #cah7;a77#a7 ( ! ,int]nal ,rev5ue ,code ( #aihf7 :o does n provide sub/antial s]vices ) respect to su* pr(essional s]vice bus9ess4 7,c7 ,specifi$ s corporation ,= purposes ( ?is subsection1 ! t]m specifi$ ,s corporation means-- 7i7 any ,s corporation 7z def9$ 9 section #acfa7;a7 ( ! ,int]nal ,rev5ue ,code ( #aihf7 :i* is a p>tn] 9 a p>tn]%ip :i* is engag$ 9 a pr(essional s]vice bus9ess if sub/antially all ( ! activities ( su* ,s corporation are p]=m$ 9 connection ) su* p>tn]%ip1 & 7ii7 any o!r ,s corporation 7z s def9$7 :i* is engag$ 9 a pr(essional s]vice bus9ess if #ge p]c5t or m ( ! gross income ( su* bus9ess is attributable to s]vice ( #c or few] %>ehold]s ( su* corporation4 7,d7 ,applicable %>ehold] ,= purposes ( ?is p>agraph1 ! t]m applicable %>ehold] means any %>ehold] ^: modifi$ adju/$ gross income = ! taxable ye> exce$s-- 7i7 9 ! case ( a %>ehold] mak+ a jo9t return "u section #fjac ( ! ,int]nal ,rev5ue ,code ( #aihf or a surviv+ sp\se 7z def9$ 9 section #b7;a7 ( su* ,code71 #bej1jjj1 7ii7 9 ! case ( a m>ri$ %>ehold] 7z def9$ 9 section #ggjc ( su* ,code7 fil+ a sep>ate return1 half ( ! doll> am\nt det]m9$ "u clause 7i71 & 7iii7 9 any o!r case1 #bjj1jjj4 7#b7 ,p>tn]s 7,a7 ,9 g5]al ,9 ! case ( any p>tn]%ip :i* is engag$ 9 a pr(essional s]vice bus9ess1 subsection 7a77#ab7 %all n apply to any applicable p>tn] :o provides sub/antial s]vices ) respect to su* pr(essional s]vice bus9ess4 7,b7 ,applicable p>tn] ,= purposes ( ?is p>agraph1 ! t]m applicable p>tn] means any p>tn] ^: modifi$ adju/$ gross income = ! taxable ye> exce$s-- 7i7 9 ! case ( a p>tn] mak+ a jo9t return "u section #fjac ( ! ,int]nal ,rev5ue ,code ( #aihf or a surviv+ sp\se 7z def9$ 9 section #b7;a7 ( su* ,code71 #bej1jjj1 7ii7 9 ! case ( a m>ri$ p>tn] 7z def9$ 9 section #ggjc ( su* ,code7 fil+ a sep>ate return1 half ( ! doll> am\nt det]m9$ "u clause 7i71 & 7iii7 9 any o!r case1 #bjj1jjj4 7#c7 ,pr(essional s]vice bus9ess ,= purposes ( ?is subsection1 ! t]m pr(essional s]vice bus9ess means any trade or bus9ess 7or portion !re(7 provid+ s]vices 9 ! fields ( heal?1 law1 lobby+1 eng9e]+1 ar*itecture1 acc\nt+1 actu>ial sci5ce1 p]=m+ arts1 consult+1 a?letics1 inve/m5t advice or managem5t1 or brok]age s]vices4 7#d7 ,modifi$ adju/$ gross income ,= purposes ( ?is subsection1 ! t]m modifi$ adju/$ gross income means adju/$ gross income z det]m9$ "u section #fb ( ! ,int]nal ,rev5ue ,code ( #aihf-- 7,a7 det]m9$ )\t reg>d to any d$uction all[$ "u section #afd7;f7 ( su* ,code1 & 7,b7 increas$ by ! am\nt exclud$ f gross income "u section #iaa7;a77#a7 ( su* ,code4 4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjab4 ,f ,limitation on ,mortgage ,int]e/ ,d$uction ,) ,respect to ,boats #bea4 ,mortgage int]e/ d$uction all[$ ) respect to boats only if boat is us$ z ! pr9cipal resid5ce ( ! taxpay] 7a7 ,9 g5]al ,subclause 7ii7 ( section #afc7;h77#d77;,a7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ 7o!r ?an a boat7 aft] #a o!r resid5ce ( ! taxpay]4 7b7 ,effective date 7#a7 ,9 g5]al ,! am5dm5t made by ?is section %all apply to indebt$ness incurr$ aft] ! date ( ! enactm5t ( ?is ,act4 7#b7 ,special rule = ref9anc+s ,= purposes ( ?is subsection1 indebt$ness result+ f ! ref9anc+ ( indebt$ness %all be treat$ z incurr$ on ! date ! ref9anc$ indebt$ness 0 incurr$ 7tak+ into acc\nt ! application ( ?is p>agraph 9 ! case ( multiple ref9anc+s7 b only to ! ext5t ! indebt$ness result+ f su* ref9anc+ does n exce$ ! ref9anc$ indebt$ness4 ,,iii ,end+ ,corporate ,subsidies ,a ,end ,fossil ,fuel ,subsidies #cja4 ,t]m9ation ( v>i\s tax exp5ditures relat+ to fossil fuels 7a7 ,9 g5]al ,sub*apt] ,c ( *apt] #ij ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new section3 #ghge4 ,t]m9ation ( c]ta9 provisions relat+ to fossil fuel inc5tives 7a7 ,9 g5]al ,! foll[+ provisions %all n apply to taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ! ,balanc+ ,act3 7#a7 ,section #dc 7relat+ to enhanc$ oil recov]y cr$it74 7#b7 ,section #de;,i 7relat+ to cr$it = produc+ oil & natural gas f m>g9al wells74 7#c7 ,section #de,k 7relat+ to cr$it = produc+ fuel f a nonconv5tional s\rce74 7#d7 ,section #aic 7relat+ to t]ti>y injectants74 7#e7 ,section #aii7;d77#i7 7relat+ to special rule = taxpay]s ) oil relat$ qualifi$ production activities income74 7#f7 ,section #dfa7;i77#b7 7relat+ to special rule = spudd+ ( oil or natural gas wells74 7#g7 ,section #dfi7;c77#c7 7relat+ to work+ int]e/s 9 oil & natural gas prop]ty74 7#h7 ,section #fac;,a 7relat+ to limitations on p]c5tage depletion 9 case ( oil & natural gas wells74 7#i7 ,section #fag 7relat+ to d$uction & recapture ( c]ta9 m9+ exploration exp5ditures74 7#aj7 ,section #ggjd7;d77#a77;,e7 7relat+ to qualify+ income74 7b7 ,provisions relat+ to prop]ty ,! foll[+ provisions %all n apply to prop]ty plac$ 9 s]vice aft] ! date ( ! enactm5t ( ! ,balanc+ ,act3 7#a7 ,subp>agraphs 7,c77iii7 & 7,e77viii7 ( section #afh7;e77#c7 7relat+ to classification ( c]ta9 prop]ty74 7#b7 ,section #afi 7relat+ to amortization ( pollution control facilities7 ) respect to any atmosph]ic pollution control facility4 7#c7 ,section #agi;,c 7relat+ to election to exp5se c]ta9 ref9]ies74 7c7 ,provisions relat+ to co/s & exp5ses ,! foll[+ provisions %all n apply to co/s or exp5ses paid or incurr$ aft] ! date ( ! enactm5t ( ! ,balanc+ ,act3 7#a7 ,section #agi;,b 7relat+ to d$uction = capital co/s incurr$ 9 comply+ ) ,environm5tal ,protection ,ag5cy sulfur regulations74 7#b7 ,section #aih 7relat+ to exp5s+ ( environm5tal rem$iation co/s74 7#c7 ,section #bfc7;c7 7relat+ to intangible drill+ & developm5t co/s7 ) respect to co/s 9 ! case ( oil & natural gas wells4 7#d7 ,section #dfh 7relat+ to special rules = m9+ & solid wa/e reclamation & clos+ co/s74 7d7 #e-,ye> c>ryback = m>g9al oil & natural gas well production cr$it ,section #ci7;a77#c7 7relat+ to #e-ye> c>ryback = m>g9al oil & natural gas well production cr$it7 %all n apply to cr$its det]m9$ 9 taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ! ,balanc+ ,act4 7e7 ,cr$it = c>bon dioxide seque/ration ,section #de,q 7relat+ to cr$it = c>bon dioxide seque/ration7 %all n apply to c>bon dioxide captur$ aft] ! date ( ! enactm5t ( ! ,balanc+ ,act4 7f7 ,allocat$ cr$its ,no new cr$its %all be c]tifi$ "u section #dh;,a 7relat+ to qualify+ advanc$ coal project cr$it7 or section #dh;,b 7relat+ to qualify+ gasification project cr$it7 aft] ! date ( ! enactm5t ( ! ,balanc+ ,act4 7g7 ,arbitrage bonds ,section #adh7;b77#d7 7relat+ to safe h>bor = prepaid natural gas7 %all n apply to obligations issu$ aft] ! date ( ! enactm5t ( ! ,balanc+ ,act4 4 7b7 ,con=m+ am5dm5t ,! table ( sections = sub*apt] ,c ( *apt] #ij is am5d$ by add+ at ! end ! foll[+ new item3 ,sec4 #ghge4 ,t]m9ation ( c]ta9 provisions4 4 #cjb4 ,t]m9ation ( alt]native fuel vehicle refuel+ prop]ty cr$it ) respect to fossil fuels 7a7 ,9 g5]al ,p>agraph 7#b7 ( section #cj;,c7c7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$-- 7#a7 by /rik+ 1 natural gas1 compress$ natural gas1 liquefi$ natural gas1 liquefi$ petroleum gas1 9 subp>agraph 7,a71 7#b7 by /rik+ subp>agraph 7,b71 & 7#c7 by r$esignat+ subp>agraph 7,c7 z subp>agraph 7,b74 7b7 ,te*nical am5dm5t ,p>agraph 7#b7 ( section #cj;,c7g7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ ! second p]iod4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to prop]ty plac$ 9 s]vice aft] ,decemb] #ca1 #bjab4 #cjc4 ,uni=m sev5-ye> amortization = geological & geophysical exp5ditures 7a7 ,9 g5]al ,section #afg7;h7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$-- 7#a7 by /rik+ #bd-mon? p]iod ea* place x appe>s 9 p>agraphs 7#a7 & 7#d7 & ins]t+ #g-ye> p]iod1 & 7#b7 by /rik+ p>agraph 7#e74 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to am\nts paid or incurr$ aft] ! date ( ! enactm5t ( ?is ,act4 #cjd4 ,repeal ( dome/ic manufactur+ d$uction = h>d m9]al m9+ 7a7 ,9 g5]al ,subp>agraph 7,b7 ( section #aii7;c77#d7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ & at ! end ( clause 7ii71 by /rik+ ! p]iod at ! end ( clause 7iii7 & ins]t+ 1 &1 & by add+ at ! end ! foll[+ new clause3 7iv7 ! m9+ ( any h>d m9]al4 4 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 #cje4 ,limitation on d$uction = income attributable to dome/ic production ( oil1 natural gas1 or prim>y products !re( 7a7 ,d5ial ( d$uction ,p>agraph 7#d7 ( section #aii7;c7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subp>agraph3 7,e7 ,special rule = oil1 natural gas1 & coal income ,! t]m dome/ic production gross receipts %all n include gross receipts f ! production1 ref9+1 process+1 transportation1 or di/ribution ( oil1 natural gas1 or coal1 or any prim>y product 7)9 ! mean+ ( subsection 7d77#i77 !re(4 4 7b7 ,effective date ,! am5dm5t made by ?is section %all apply to taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 #cjf4 ,t]m9ation ( la/-91 fir/-out me?od ( inv5tory = oil1 natural gas1 & coal companies 7a7 ,9 g5]al ,section #dgb ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7h7 ,t]m9ation = oil1 natural gas1 & coal companies ,subsection 7a7 %all n apply to any taxpay] t is 9 ! trade or bus9ess ( ! production1 ref9+1 process+1 transportation1 or di/ribution ( oil1 natural gas1 or coal = any taxable ye> beg9n+ aft] ,decemb] #ca1 #bjab4 4 7b7 ,additional t]m9ation ,section #dgc ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7h7 ,t]m9ation = oil1 natural gas1 & coal companies ,?is section %all n apply to any taxpay] t is 9 ! trade or bus9ess ( ! production1 ref9+1 process+1 transportation1 or di/ribution ( oil1 natural gas1 or coal = any taxable ye> beg9n+ aft] ,decemb] #ca1 #bjab4 4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 #cjg4 ,repeal ( p]c5tage depletion = coal & h>d m9]al fossil fuels 7a7 ,9 g5]al ,section #fac ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7f7 ,t]m9ation ) respect to coal & h>d m9]al fossil fuels ,9 ! case ( coal1 lignite1 & oil %ale 7o!r ?an oil %ale describ$ 9 subsection 7b77#e771 ! all[ance = depletion %all be comput$ )\t ref]5ce to ?is section = any taxable ye> beg9n+ aft] ! date ( ! enactm5t ( ! ,balanc+ ,act4 4 7b7 ,con=m+ am5dm5ts 7#a7 ,coal & lignite ,section #fac7;b77#d7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ coal1 lignite14 7#b7 ,oil %ale ,section #fac7;b77#b7 ( su* ,code is am5d$ to read z foll[s3 7#b7 #ae p]c5t ,if1 f deposits 9 ! ,unit$ ,/ates1 gold1 silv]1 copp]1 & iron ore4 4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 #cjh4 ,t]m9ation ( capital ga9s treatm5t = royalties f coal 7a7 ,9 g5]al ,subsection 7c7 ( section #fca ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$-- 7#a7 by /rik+ coal 7includ+ lignite71 or iron ore & ins]t+ iron ore1 7#b7 by /rik+ coal or iron ore ea* place x appe>s & ins]t+ iron ore1 7#c7 by /rik+ iron ore or coal ea* place x appe>s & ins]t+ iron ore1 & 7#d7 by /rik+ coal or 9 ! head+4 7b7 ,con=m+ am5dm5t ,! head+ ( section #fca ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ 1 coal14 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to dispositions aft] ! date ( ! enactm5t ( ?is ,act4 #cji4 ,increase 9 oil spill liability tru/ fund f9anc+ rate 7a7 ,9 g5]al ,subp>agraph 7,b7 ( section #dfaa7;c77#b7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ to read z foll[s3 7,b7 ! ,oil ,spill ,liability ,tru/ ,fund f9anc+ rate is-- 7i7 9 ! case ( crude oil receiv$ or petroleum products ent]$ be=e ,janu>y #a1 #bjac1 #h c5ts a b>rel1 7ii7 9 ! case ( crude oil receiv$ or petroleum products ent]$ aft] ,decemb] #ca1 #bjab1 & be=e ,janu>y #a1 #bjag1 #i c5ts a b>rel1 & 7iii7 9 ! case ( crude oil receiv$ or petroleum products ent]$ aft] ,decemb] #ca1 #bjaf1 #aj c5ts a b>rel4 4 7b7 ,effective date ,! am5dm5t made by ?is section %all apply to crude oil receiv$ & petroleum products ent]$ aft] ! date ( ! enactm5t ( ?is ,act4 #caj4 ,d5ial ( d$uction = removal co/s & damages = c]ta9 oil spills 7a7 ,9 g5]al ,"p ,,ix ( sub*apt] ,b ( *apt] #a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new section3 #bhj;,i4 ,exp5ses = removal co/s & damages relat+ to c]ta9 oil spill liability ,no d$uction %all be all[$ "u ?is *apt] = any am\nt paid or incurr$ ) respect to any co/s or damages = :i* ! taxpay] is liable "u section #ajjb ( ! ,oil ,pollution ,act ( #aiij 7#cc ,u4,s4,c4 #bgjb74 4 7b7 ,cl]ical am5dm5t ,! table ( sections = "p ,,ix ( sub*apt] ,b ( *apt] #a ( su* ,code is am5d$ by add+ at ! end ! foll[+ new item3 ,sec4 #bhj;,i4 ,exp5ses = removal co/s & damages relat+ to c]ta9 oil spill liability4 4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply ) respect to any liability aris+ 9 taxable ye>s end+ aft] ! date ( ! enactm5t ( ?is ,act4 #caa4 ,tax on crude oil & natural gas produc$ f ! out] ,cont95tal ,%elf 9 ! ,gulf ( ,mexico 7a7 ,9 g5]al ,subtitle ,e ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new *apt]3 #ef ,tax on sev]ance ( crude oil & natural gas f ! out] ,cont95tal ,%elf 9 ! ,gulf ( ,mexico ,sec4 #ehif4 ,imposition ( tax4 ,sec4 #ehig4 ,taxable crude oil or natural gas & removal price4 ,sec4 #ehih4 ,special rules & def9itions4 #ehif4 ,imposition ( tax 7a7 ,9 g5]al ,9 addition to any o!r tax impos$ "u ?is title1 !re is h]eby impos$ a tax equal to #ac p]c5t ( ! removal price ( any taxable crude oil or natural gas remov$ f ! premises dur+ any taxable p]iod4 7b7 ,cr$it = ,f$]al royalties paid 7#a7 ,9 g5]al ,!re %all be all[$ z a cr$it aga9/ ! tax impos$ by subsection 7a7 ) respect to ! production ( any taxable crude oil or natural gas an am\nt equal to ! aggregate am\nt ( royalties paid "u ,f$]al law ) respect to su* production4 7#b7 ,limitation ,! aggregate am\nt ( cr$its all[$ "u p>agraph 7#a7 to any taxpay] = any taxable p]iod %all n exce$ ! am\nt ( tax impos$ by subsection 7a7 = su* taxable p]iod4 7c7 ,tax paid by produc] ,! tax impos$ by ?is section %all be paid by ! produc] ( ! taxable crude oil or natural gas4 #ehig4 ,taxable crude oil or natural gas & removal price 7a7 ,taxable crude oil or natural gas ,= purposes ( ?is *apt]1 ! t]m taxable crude oil or natural gas means crude oil or natural gas :i* is produc$ f ,f$]al subm]g$ l&s on ! out] ,cont95tal ,%elf 9 ! ,gulf ( ,mexico pursuant to a lease ent]$ into ) ! ,unit$ ,/ates :i* au?orizes ! production4 7b7 ,removal price ,= purposes ( ?is *apt]-- 7#a7 ,9 g5]al ,except z o!rwise provid$ 9 ?is subsection1 ! t]m removal price means-- 7,a7 9 ! case ( taxable crude oil1 ! am\nt = :i* a b>rel ( su* crude oil is sold1 & 7,b7 9 ! case ( taxable natural gas1 ! am\nt p] #a1jjj cubic feet = :i* su* natural gas is sold4 7#b7 ,sales betwe5 relat$ p]sons ,9 ! case ( a sale betwe5 relat$ p]sons1 ! removal price %all n be less ?an ! con/ructive sales price = purposes ( det]m9+ gross income f ! prop]ty "u section #fac4 7#c7 ,oil or natural gas remov$ f prop]ty be=e sale ,if crude oil or natural gas is remov$ f ! prop]ty be=e x is sold1 ! removal price %all be ! con/ructive sales price = purposes ( det]m9+ gross income f ! prop]ty "u section #fac4 7#d7 ,ref9+ begun on prop]ty ,if ! manufacture or conv]sion ( crude oil into ref9$ products beg9s be=e su* oil is remov$ f ! prop]ty-- 7,a7 su* oil %all be treat$ z remov$ on ! day su* manufacture or conv]sion beg9s1 & 7,b7 ! removal price %all be ! con/ructive sales price = purposes ( det]m9+ gross income f ! prop]ty "u section #fac4 7#e7 ,prop]ty ,! t]m prop]ty has ! mean+ giv5 su* t]m by section #fad4 #ehih4 ,special rules & def9itions 7a7 ,adm9i/rative requirem5ts 7#a7 ,)hold+ & deposit ( tax ,! ,secret>y %all provide = ! )hold+ & deposit ( ! tax impos$ "u section #ehif on a qu>t]ly basis4 7#b7 ,records & in=mation ,ea* taxpay] liable = tax "u section #ehif %all keep su* records1 make su* returns1 & furni% su* in=mation 7to ! ,secret>y & to o!r p]sons hav+ an int]e/ 9 ! taxable crude oil or natural gas7 ) respect to su* oil z ! ,secret>y may by regulations prescribe4 7#c7 ,taxable p]iods2 return ( tax 7,a7 ,taxable p]iod ,except z provid$ by ! ,secret>y1 ea* cal5d> ye> %all con/itute a taxable p]iod4 7,b7 ,returns ,! ,secret>y %all provide = ! fil+1 & ! "t = fil+1 ( ! return ( ! tax impos$ "u section #ehif4 7b7 ,def9itions ,= purposes ( ?is *apt]-- 7#a7 ,produc] ,! t]m produc] means ! hold] ( ! economic int]e/ ) respect to ! crude oil or natural gas4 7#b7 ,crude oil ,! t]m crude oil includes crude oil cond5sates & natural gasol9e4 7#c7 ,premises & crude oil product ,! t]ms premises & crude oil product h ! same mean+s z :5 us$ = purposes ( det]m9+ gross income f ! prop]ty "u section #fac4 7c7 ,adju/m5t ( removal price ,9 det]m9+ ! removal price ( oil or natural gas f a prop]ty 9 ! case ( any transaction1 ! ,secret>y may adju/ ! removal price to reflect cle>ly ! fair m>ket value ( oil or natural gas remov$4 7d7 ,regulations ,! ,secret>y %all prescribe su* regulations z may be necess>y or appropriate to c>ry out ! purposes ( ?is *apt]4 4 7b7 ,d$uctibility ( tax ,! fir/ s5t5ce ( section #afd7;a7 is am5d$ by ins]t+ aft] p>agraph 7#f7 ! foll[+ new p>agraph3 7#g7 ,! tax impos$ by section #ehif7;a7 7aft] application ( section #ehif7;b77 on ! sev]ance ( crude oil or natural gas f ! out] ,cont95tal ,%elf 9 ! ,gulf ( ,mexico4 4 7c7 ,cl]ical am5dm5t ,! table ( *apt]s = subtitle ,e is am5d$ by add+ at ! end ! foll[+ new item3 ,*apt] #ef4 ,tax on sev]ance ( crude oil & natural gas f ! out] ,cont95tal ,%elf 9 ! ,gulf ( ,mexico4 4 7d7 ,effective date ,! am5dm5ts made by ?is section %all apply to crude oil or natural gas remov$ aft] ,decemb] #ca1 #bjab4 ,b ,end+ ,excessive ,corporate ,tax ,d$uctions = ,/ock ,options #cca4 ,consi/5t treatm5t ( /ock options by corporations 7a7 ,consi/5t treatm5t = wage d$uction 7#a7 ,9 g5]al ,section #hc7;h7 is am5d$-- 7,a7 by /rik+ ,9 ! case ( & ins]t+3 7#a7 ,9 g5]al ,9 ! case ( 1 & 7,b7 by add+ at ! end ! foll[+ new p>agraph3 7#b7 ,/ock options ,9 ! case ( prop]ty transf]r$ to a p]son 9 connection ) a /ock option1 any d$uction relat$ to su* /ock option %all be all[$ only "u section #afb7q7 & p>agraph 7#a7 %all n apply4 4 7#b7 ,treatm5t ( comp5sation paid ) /ock options ,section #afb is am5d$ by r$esignat+ subsection 7q7 z subsection 7r7 & by ins]t+ aft] subsection 7p7 ! foll[+ new subsection3 7q7 ,treatm5t ( comp5sation paid ) /ock options 7#a7 ,9 g5]al ,9 ! case ( comp5sation = p]sonal s]vices t is paid ) /ock options1 ! d$uction "u subsection 7a77#a7 %all n exce$ ! am\nt ! taxpay] has treat$ z comp5sation co/ ) respect to su* /ock options = ! purpose ( asc]ta9+ income1 pr(it1 or loss 9 a report or /atem5t to %>ehold]s1 p>tn]s1 or o!r proprietors 7or to b5efici>ies71 & %all be tak5 into acc\nt 9 ! same p]iod t su* comp5sation co/ is recogniz$ = su* purpose4 7#b7 ,special rules = controll$ gr\ps ,! ,secret>y may prescribe rules = ! application ( p>agraph 7#a7 9 cases :]e ! /ock option is grant$ by-- 7,a7 a p>5t or subsidi>y corporation 7)9 ! mean+ ( section #dbd7 ( ! taxpay]1 or 7,b7 ano!r corporation4 4 7b7 ,consi/5t treatm5t = rese>* tax cr$it ,section #da7;b77#b77;,d7 is am5d$ by ins]t+ at ! end ! foll[+ new clause3 7iv7 ,special rule = /ock options ,! am\nt :i* may be treat$ z wages = any taxable ye> 9 connection ) ! issuance ( a /ock option %all n exce$ ! am\nt all[$ = su* taxable ye> z a comp5sation d$uction "u section #afb7q7 ) respect to su* /ock option4 4 7c7 ,application ( am5dm5ts ,! am5dm5ts made by ?is section %all apply to /ock options ex]cis$ aft] ! date ( ! enactm5t ( ?is ,act1 except t-- 7#a7 su* am5dm5ts %all n apply to /ock options t 7 grant$ be=e su* date & t ve/$ 9 taxable p]iods beg9n+ on or be=e ,june #ae1 #bjje1 7#b7 = /ock options t 7 grant$ be=e su* date ( enactm5t & ve/$ dur+ taxable p]iods beg9n+ aft] ,june #ae1 #bjje1 & end+ be=e su* date ( enactm5t1 a d$uction "u section #afb7q7 ( ! ,int]nal ,rev5ue ,code ( #aihf 7z add$ by subsection 7a77#b77 %all be all[$ 9 ! fir/ taxable p]iod ( ! taxpay] t ends aft] su* date ( enactm5t1 7#c7 = public entities report+ z small bus9ess issu]s & = non-public entities requir$ to file public reports ( f9ancial condition1 p>agraphs 7#a7 & 7#b7 %all be appli$ by sub/itut+ ,decemb] #ae1 #bjje = ,june #ae1 #bjje1 & 7#d7 no d$uction %all be all[$ "u section #hc7;h7 or section #afb7q7 ( su* ,code ) respect to any /ock option ! ve/+ date ( :i* is *ang$ to accel]ate ! "t at :i* ! option may be ex]cis$ 9 ord] to avoid ! applicability ( su* am5dm5ts4 #ccb4 ,application ( executive pay d$uction limit 7a7 ,9 g5]al ,subp>agraph 7,d7 ( section #afb7m77#d7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ to read z foll[s3 7,d7 ,/ock option comp5sation ,! t]m applicable employee remun]ation %all include any comp5sation d$uct$ "u subsection 7q71 & su* comp5sation %all n qualify z p]=mance-bas$ comp5sation "u subp>agraph 7,c74 4 7b7 ,effective date ,! am5dm5t made by ?is section %all apply to /ock options ex]cis$ or grant$ aft] ! date ( ! enactm5t ( ?is ,act4 ,c ,r$uce ,d$uction ( ,corporate ,meals & ,ent]ta9m5t #cda4 ,r$uction 9 bus9ess meals & ent]ta9m5t tax d$uction 7a7 ,9 g5]al ,section #bgd7n77#a7 ( ! ,int]nal ,rev5ue ,code ( #aihf 7relat+ to only #ej p]c5t ( meal & ent]ta9m5t exp5ses all[$ z d$uction7 is am5d$ by /rik+ #ej p]c5t & ins]t+ #be p]c5t4 7b7 ,con=m+ am5dm5t ,section #bgd7n7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ p>agraph 7#c74 7c7 ,cl]ical am5dm5t ,! head+ = section #bgd7n7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ ,only #ej ,p]c5t & ins]t+ ,only #be ,p]c5t4 7d7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjab4 ,,iv ,close ,int]national ,tax ,sy/em ,loopholes ,a ,re=mation ( ,u4,s4 int]national tax sy/em #dja4 ,allocation ( exp5ses & taxes on basis ( repatriation ( =eign income 7a7 ,9 g5]al ,"p ,,iii ( sub*apt] ,n ( *apt] #a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ aft] subp>t ,g ! foll[+ new subp>t3 ,h ,special ,rules = ,allocation ( ,=eign-,relat$ ,d$uctions & ,=eign ,tax ,cr$its ,sec4 #ige4 ,d$uctions allocat$ to def]r$ =eign income may n (fset ,unit$ ,/ates s\rce income4 ,sec4 #igf4 ,am\nt ( =eign taxes comput$ on ov]all basis4 ,sec4 #igg4 ,application ( subp>t4 #ige4 ,d$uctions allocat$ to def]r$ =eign income may n (fset ,unit$ ,/ates s\rce income 7a7 ,curr5t ye> d$uctions ,= purposes ( ?is *apt]1 =eign-relat$ d$uctions = any taxable ye>-- 7#a7 %all be tak5 into acc\nt = su* taxable ye> only to ! ext5t t su* d$uctions are allocable to curr5tly-tax$ =eign income1 & 7#b7 to ! ext5t n s all[$1 %all be tak5 into acc\nt 9 subsequ5t taxable ye>s z provid$ 9 subsection 7b74 ,=eign-relat$ d$uctions %all be allocat$ to curr5tly tax$ =eign income 9 ! same proportion :i* curr5tly tax$ =eign income be>s to ! sum ( curr5tly tax$ =eign income & def]r$ =eign income4 7b7 ,d$uctions relat$ to repatriat$ def]r$ =eign income 7#a7 ,9 g5]al ,if !re is repatriat$ =eign income = a taxable ye>1 ! portion ( ! previ\sly def]r$ d$uctions allocat$ to ! repatriat$ =eign income %all be tak5 into acc\nt = ! taxable ye> z a d$uction allocat$ to income f s\rces outside ! ,unit$ ,/ates4 ,any su* am\nt %all n be includ$ 9 =eign-relat$ d$uctions = purposes ( apply+ subsection 7a7 to su* taxable ye>4 7#b7 ,portion ( previ\sly def]r$ d$uctions ,= purposes ( p>agraph 7#a71 ! portion ( ! previ\sly def]r$ d$uctions allocat$ to repatriat$ =eign income is-- 7,a7 ! am\nt :i* be>s ! same proportion to su* d$uctions1 z 7,b7 ! repatriat$ income be>s to ! previ\sly def]r$ =eign income4 7c7 ,def9itions & special rule ,= purposes ( ?is section-- 7#a7 ,=eign-relat$ d$uctions ,! t]m =eign-relat$ d$uctions means ! total am\nt ( d$uctions & exp5ses :i* w\ld be allocat$ or apportion$ to gross income f s\rces )\t ! ,unit$ ,/ates = ! taxable ye> if bo? ! curr5tly-tax$ =eign income & def]r$ =eign income 7 tak5 into acc\nt4 7#b7 ,curr5tly-tax$ =eign income ,! t]m curr5tly-tax$ =eign income means ! am\nt ( gross income f s\rces )\t ! ,unit$ ,/ates = ! taxable ye> 7det]m9$ )\t reg>d to repatriat$ =eign income = su* ye>74 7#c7 ,def]r$ =eign income ,! t]m def]r$ =eign income means ! excess (-- 7,a7 ! am\nt t w\ld be includible 9 gross income "u subp>t ,f ( ?is "p = ! taxable ye> if-- 7i7 all controll$ =eign corporations 7 treat$ z "o controll$ =eign corporation1 & 7ii7 all e>n+s & pr(its ( all controll$ =eign corporations 7 subp>t ,f income 7z def9$ 9 section #ieb71 ov] 7,b7 ! sum (-- 7i7 all divid5ds receiv$ dur+ ! taxable ye> f controll$ =eign corporations1 plus 7ii7 am\nts includible 9 gross income "u section #iea7;a74 7#d7 ,previ\sly def]r$ =eign income ,! t]m previ\sly def]r$ =eign income means ! aggregate am\nt ( def]r$ =eign income = all prior taxable ye>s to :i* ?is "p applies1 det]m9$ z ( ! beg9n+ ( ! taxable ye>1 r$uc$ by ! repatriat$ =eign income = all su* prior taxable ye>s4 7#e7 ,repatriat$ =eign income ,! t]m repatriat$ =eign income means ! am\nt includ$ 9 gross income on acc\nt ( di/ributions out ( previ\sly def]r$ =eign income4 7#f7 ,previ\sly def]r$ d$uctions ,! t]m previ\sly def]r$ d$uctions means ! aggregate am\nt ( =eign-relat$ d$uctions n tak5 into acc\nt "u subsection 7a7 = all prior taxable ye>s 7det]m9$ z ( ! beg9n+ ( ! taxable ye>71 r$uc$ by any am\nts tak5 into acc\nt "u subsection 7b7 = su* prior taxable ye>s4 7#g7 ,treatm5t ( c]ta9 =eign taxes 7,a7 ,paid by controll$ =eign corporation ,section #gh %all n apply = purposes ( det]m9+ curr5tly-tax$ =eign income & def]r$ =eign income4 7,b7 ,paid by taxpay] ,= purposes ( det]m9+ curr5tly-tax$ =eign income1 gross income f s\rces )\t ! ,unit$ ,/ates %all be r$uc$ by ! aggregate am\nt ( taxes describ$ 9 ! applicable p>agraph ( section #ija7;b7 :i* are paid by ! taxpay] 7)\t reg>d to sections #ijb & #ifj7 dur+ ! taxable ye>4 7#h7 ,coord9ation ) section #igf ,9 det]m9+ curr5tly-tax$ =eign income & def]r$ =eign income1 ! am\nt ( deem$ =eign tax cr$its %all be det]m9$ ) reg>d to section #igf4 #igf4 ,am\nt ( =eign taxes comput$ on ov]all basis 7a7 ,curr5t ye> all[ance ,= purposes ( ?is *apt]1 ! am\nt tak5 into acc\nt z =eign income taxes = any taxable ye> %all be an am\nt :i* be>s ! same ratio to ! total =eign income taxes = t taxable ye> z-- 7#a7 ! curr5tly-tax$ =eign income = su* taxable ye>1 be>s to 7#b7 ! sum ( ! curr5tly-tax$ =eign income & def]r$ =eign income = su* ye>4 ,! portion ( ! total =eign income taxes = any taxable ye> n tak5 into acc\nt "u ! prec$+ s5t5ce = a taxable ye> %all only be tak5 into acc\nt z provid$ 9 subsection 7b7 7& %all n be tak5 into acc\nt = purposes ( apply+ sections #ijb & #ifj74 7b7 ,all[ance relat$ to repatriat$ def]r$ =eign income 7#a7 ,9 g5]al ,if !re is repatriat$ =eign income = any taxable ye>1 ! portion ( ! previ\sly def]r$ =eign income taxes paid or accru$ dur+ su* taxable ye> %all be tak5 into acc\nt = ! taxable ye> z =eign taxes paid or accru$4 ,any su* taxes s tak5 into acc\nt %all n be includ$ 9 =eign income taxes = purposes ( apply+ subsection 7a7 to su* taxable ye>4 7#b7 ,portion ( previ\sly def]r$ =eign income taxes ,= purposes ( p>agraph 7#a71 ! portion ( ! previ\sly def]r$ =eign income taxes allocat$ to repatriat$ def]r$ =eign income is-- 7,a7 ! am\nt :i* be>s ! same proportion to su* taxes1 z 7,b7 ! repatriat$ def]r$ income be>s to ! previ\sly def]r$ =eign income4 7c7 ,def9itions & special rule ,= purposes ( ?is section-- 7#a7 ,previ\sly def]r$ =eign income taxes ,! t]m previ\sly def]r$ =eign income taxes means ! aggregate am\nt ( total =eign income taxes n tak5 into acc\nt "u subsection 7a7 = all prior taxable ye>s 7det]m9$ z ( ! beg9n+ ( ! taxable ye>71 r$uc$ by any am\nts tak5 into acc\nt "u subsection 7b7 = su* prior taxable ye>s4 7#b7 ,total =eign income taxes ,! t]m total =eign income taxes means ! sum ( =eign income taxes paid or accru$ dur+ ! taxable ye> 7det]m9$ )\t reg>d to section #ijd7;c77 plus ! increase 9 =eign income taxes t w\ld be paid or accru$ dur+ ! taxable ye> "u sections #ijb & #ifj if-- 7,a7 all controll$ =eign corporations 7 treat$ z "o controll$ =eign corporation1 & 7,b7 all e>n+s & pr(its ( all controll$ =eign corporations 7 subp>t ,f income 7z def9$ 9 section #ieb74 7#c7 ,=eign income taxes ,! t]m =eign income taxes means any income1 w> pr(its1 or excess pr(its taxes paid by ! taxpay] to any =eign c\ntry or possession ( ! ,unit$ ,/ates4 7#d7 ,curr5tly-tax$ =eign income & def]r$ =eign income ,! t]ms curr5tly-tax$ =eign income & def]r$ =eign income h ! mean+s giv5 su* t]ms by section #ige7;c774 #igg4 ,application ( subp>t ,?is subp>t-- 7#a7 %all be appli$ be=e subp>t ,a1 & 7#b7 %all be appli$ sep>ately ) respect to ! categories ( income specifi$ 9 section #ijd7;d77#a74 4 7b7 ,cl]ical am5dm5t ,! table ( subp>ts = "p ,,iii ( subp>t ,n ( *apt] #a ( su* ,code is am5d$ by ins]t+ aft] ! item relat+ to subp>t ,g ! foll[+ new item3 ,subp>t ,h4 ,special ,rules = ,allocation ( ,=eign-,relat$ ,d$uctions & ,=eign ,tax ,cr$its4 4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 #djb4 ,excess income f transf]s ( intangibles to l[-tax$ affiliates treat$ z subp>t ,f income 7a7 ,9 g5]al ,subsection 7a7 ( section #ied ( su* ,code is am5d$ by ins]t+ aft] p>agraph 7#c7 ! foll[+ new p>agraph3 7#d7 ! =eign base company excess intangible income = ! taxable ye> 7det]m9$ "u subsection 7f7 & r$uc$ z provid$ 9 subsection 7b77#e771 & 4 7b7 ,=eign base company excess intangible income ,section #ied ( su* ,code is am5d$ by ins]t+ aft] subsection 7e7 ! foll[+ new subsection3 7f7 ,=eign base company excess intangible income ,= purposes ( subsection 7a77#d7 & ?is subsection3 7#a7 ,=eign base company excess intangible income def9$ 7,a7 ,9 g5]al ,! t]m =eign base company excess intangible income means1 ) respect to any cov]$ intangible1 ! excess (-- 7i7 ! sum (-- 7,i7 gross income f ! sale1 lease1 lic5se1 or o!r disposition ( prop]ty 9 :i* su* cov]$ intangible is us$ directly or indirectly1 & 7,,ii7 gross income f ! provision ( s]vices relat$ to su* cov]$ intangible or 9 connection ) prop]ty 9 :i* su* cov]$ intangible is us$ directly or indirectly1 ov] 7ii7 #aej p]c5t ( ! co/s prop]ly allocat$ & apportion$ to ! gross income tak5 into acc\nt "u clause 7i7 o!r ?an exp5ses = int]e/ & taxes & any exp5ses :i* are n directly allocable to su* gross income4 7,b7 ,same c\ntry income n tak5 into acc\nt ,if-- 7i7 ! sale1 lease1 lic5se1 or o!r disposition ( ! prop]ty ref]r$ to 9 subp>agraph 7,a77i77,i7 is = use1 consumption1 or disposition 9 ! c\ntry "u ! laws ( :i* ! controll$ =eign corporation is creat$ or organiz$1 or 7ii7 ! s]vices ref]r$ to 9 subp>agraph 7,a77i77,,ii7 are p]=m$ 9 su* c\ntry1 ! gross income f su* sale1 lease1 lic5se1 or o!r disposition1 or provision ( s]vices1 %all n be tak5 into acc\nt "u subp>agraph 7,a77i74 7#b7 ,exception bas$ on effective =eign income tax rate 7,a7 ,9 g5]al ,=eign base company excess intangible income %all n include ! applicable p]c5tage ( any item ( income receiv$ by a controll$ =eign corporation if ! taxpay] e/abli%es to ! satisfaction ( ! ,secret>y t su* income 0 subject to an effective rate ( income tax impos$ by a =eign c\ntry 9 excess ( #e p]c5t4 7,b7 ,applicable p]c5tage ,= purposes ( subp>agraph 7,a71 ! t]m applicable p]c5tage means ! ratio 7express$ z a p]c5tage71 n great] ?an #ajj p]c5t1 (-- 7i7 ! numb] ( p]c5tage po9ts by :i* ! effective rate ( income tax ref]r$ to 9 subp>agraph 7,a7 exce$s #e p]c5tage po9ts1 ov] 7ii7 #aj p]c5tage po9ts4 7,c7 ,treatm5t ( losses 9 det]m9+ effective rate ( =eign income tax ,= purposes ( det]m9+ ! effective rate ( income tax impos$ by any =eign c\ntry-- 7i7 su* effective rate %all be det]m9$ )\t reg>d to any losses c>ri$ to ! relevant taxable ye>1 & 7ii7 to ! ext5t ! income ) respect to su* intangible r$uces losses 9 ! relevant taxable ye>1 su* effective rate %all be treat$ z be+ ! effective rate :i* w\ld h be5 impos$ on su* income )\t reg>d to su* losses4 7#c7 ,cov]$ intangible ,! t]m cov]$ intangible means1 ) respect to any controll$ =eign corporation1 any intangible prop]ty 7z def9$ 9 section #icf7;h77#c77;,b77-- 7,a7 :i* is sold1 leas$1 lic5s$1 or o!rwise transf]r$ 7directly or indirectly7 to su* controll$ =eign corporation f a relat$ p]son1 or 7,b7 ) respect to :i* su* controll$ =eign corporation & "o or m relat$ p]sons has 7directly or indirectly7 ent]$ into any %>$ risk or developm5t agreem5t 7includ+ any co/ %>+ agreem5t74 7#d7 ,relat$ p]son ,! t]m relat$ p]son has ! mean+ giv5 su* t]m 9 subsection 7d77#c74 4 7c7 ,sep>ate basket = =eign tax cr$it ,subsection 7d7 ( section #ijd ( su* ,code is am5d$ by r$esignat+ p>agraph 7#g7 z p>agraph 7#h7 & by ins]t+ aft] p>agraph 7#f7 ! foll[+ new p>agraph3 7#f7 ,sep>ate application to =eign base company excess intangible income 7,a7 ,9 g5]al ,subsections 7a71 7b71 & 7c7 ( ?is section & sections #ijb1 #ijg1 & #ifj %all be appli$ sep>ately ) respect to ea* item ( income :i* is tak5 into acc\nt "u section #ied7;a77#d7 z =eign base company excess intangible income4 7,b7 ,regulations ,! ,secret>y may issue su* regulations or o!r guidance z is necess>y or appropriate to c>ry out ! purposes ( ?is subsection1 includ+ regulations or o!r guidance :i* provides t relat$ items ( income may be aggregat$ = purposes ( ?is p>agraph4 4 7d7 ,con=m+ am5dm5ts 7#a7 ,p>agraph 7#d7 ( section #ied7;b7 ( su* ,code is am5d$ by ins]t+ =eign base company excess intangible income describ$ 9 subsection 7a77#d7 or be=e =eign base company oil-relat$ income 9 ! la/ s5t5ce !re(4 7#b7 ,subsection 7b7 ( section #ied ( su* ,code is am5d$ by add+ at ! end ! foll[+ new p>agraph3 7#g7 ,=eign base company excess intangible income n treat$ z ano!r k9d ( base company income ,income ( a corporation :i* is =eign base company excess intangible income %all n be consid]$ =eign base company income ( su* corporation "u p>agraph 7#b71 7#c71 or 7#e7 ( subsection 7a74 4 7e7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 #djc4 ,limitations on income %ift+ ?r\gh intangible prop]ty transf]s 7a7 ,cl>ification ( def9ition ( intangible asset ,clause 7vi7 ( section #icf7;h77#c77;,b7 ( su* ,code is am5d$ by ins]t+ 7includ+ any section #aig intangible describ$ 9 subp>agraph 7,a71 7,b71 or 7,c77i7 ( subsection 7d77#a7 ( su* section7 aft] item4 7b7 ,cl>ification ( all[able valuation me?ods 7#a7 ,=eign corporations ,p>agraph 7#b7 ( section #cfg7;d7 ( su* ,code is am5d$ by add+ at ! end ! foll[+ new subp>agraph3 7,d7 ,regulatory au?ority ,= purposes ( ! la/ s5t5ce ( subp>agraph 7,a71 ! ,secret>y may require-- 7i7 ! valuation ( transf]s ( intangible prop]ty on an aggregate basis1 or 7ii7 ! valuation ( su* a transf] on ! basis ( ! reali/ic alt]natives to su* a transf]1 9 any case 9 :i* ! ,secret>y det]m9es t su* basis is ! mo/ reliable means ( valuation ( su* transf]s4 4 7#b7 ,allocation among taxpay]s ,section #dhb ( su* ,code is am5d$ by add+ at ! end ! foll[+3 ,= purposes ( ! prec$+ s5t5ce1 ! ,secret>y may require ! valuation ( transf]s ( intangible prop]ty on an aggregate basis or ! valuation ( su* a transf] on ! basis ( ! reali/ic alt]natives to su* a transf]1 9 any case 9 :i* ! ,secret>y det]m9es t su* basis is ! mo/ reliable means ( valuation ( su* transf]s44 7c7 ,effective date 7#a7 ,9 g5]al ,! am5dm5ts made by ?is section %all apply to transf]s 9 taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 7#b7 ,no inf]5ce ,no?+ 9 ! am5dm5t made by subsection 7a7 %all be con/ru$ to create any inf]5ce ) respect to ! application ( section #icf7;h77#c7 ( ! ,int]nal ,rev5ue ,code ( #aihf1 or ! au?ority ( ! ,secret>y ( ! ,treasury to provide regulations = su* application1 on or be=e ! date ( ! enactm5t ( su* am5dm5t4 #djd4 ,limitation on e>n+s /ripp+ by expatriat$ entities 7a7 ,9 g5]al ,subsection 7j7 ( section #afc ( su* ,code is am5d$-- 7#a7 by r$esignat+ p>agraph 7#i7 z p>agraph 7#aj71 & 7#b7 by ins]t+ aft] p>agraph 7#h7 ! foll[+ new p>agraph3 7#i7 ,special rules = expatriat$ entities 7,a7 ,9 g5]al ,9 ! case ( a corporation to :i* ?is subsection applies :i* is an expatriat$ entity1 ?is subsection %all apply to su* corporation ) ! foll[+ modifications3 7i7 ,p>agraph 7#b77;,a7 %all be appli$ )\t reg>d to clause 7ii7 !re(4 7ii7 ,p>agraph 7#a77;,b7 %all be appli$-- 7,i7 )\t reg>d to ! p>5!tical1 & 7,,ii7 by sub/itut+ 9 ! #a/ succe$+ taxable ye> & 9 ! #bnd ?r\gh #aj? succe$+ taxable ye>s to ! ext5t n previ\sly tak5 into acc\nt "u ?is subp>agraph = 9 ! succe$+ taxable ye>4 7iii7 ,p>agraph 7#b77;,b7 %all be appli$-- 7,i7 )\t reg>d to clauses 7ii7 & 7iii71 & 7,,ii7 by sub/itut+ #be p]c5t ( ! adju/$ taxable income ( ! corporation = su* taxable ye> = ! matt] ( clause 7i77,,ii7 !re(4 7,b7 ,expatriat$ entity ,= purposes ( ?is p>agraph-- 7i7 ,9 g5]al ,) respect to a corporation & a taxable ye>1 ! t]m expatriat$ entity has ! mean+ giv5 su* t]m by section #ghgd7;a77#b71 det]m9$ z if su* section & ! regulations "u su* section z 9 effect on ! fir/ day ( su* taxable ye> appli$ to all taxable ye>s ( ! corporation beg9n+ aft] ,july #aj1 #aihi4 7ii7 ,exception = surrogates treat$ z a dome/ic corporation ,! t]m expatriat$ entity does n include a surrogate =eign corporation :i* is treat$ z a dome/ic corporation by reason ( section #ghgd7;b74 4 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4 #dje4 ,prev5tion ( avoidance ( tax ?r\gh re9surance ) non-tax$ affiliates 7a7 ,9 g5]al ,"p ,,iii ( sub*apt] ,l ( *apt] #a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new section3 #hdi4 ,special rules = re9surance ( non-life contracts ) non-tax$ affiliates 7a7 ,9 g5]al ,! taxable income "u section #hca7;a7 or ! life insurance company taxable income "u section #hja7;b7 7z ! case may be7 ( an insurance company %all be det]m9$ by n tak+ into acc\nt-- 7#a7 any non-tax$ re9surance premium1 7#b7 any additional am\nt paid by su* insurance company ) respect to ! re9surance = :i* su* non-tax$ re9surance premium is paid1 to ! ext5t su* additional am\nt is prop]ly allocable to su* non-tax$ re9surance premium1 & 7#c7 any return premium1 c$+ commission1 re9surance recov]$1 or o!r am\nt receiv$ by su* insurance company ) respect to ! re9surance = :i* su* non-tax$ re9surance premium is paid1 to ! ext5t su* return premium1 c$+ commission1 re9surance recov]$1 or o!r am\nt is prop]ly allocable to su* non-tax$ re9surance premium4 7b7 ,non-,tax$ re9surance premiums ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m non-tax$ re9surance premium means any re9surance premium paid directly or indirectly to an affiliat$ corporation ) respect to re9surance ( risks 7o!r ?an except$ risks71 to ! ext5t t ! income attributable to ! premium is n subject to tax "u ?is subtitle 7ei!r z ! income ( ! affiliat$ corporation or z am\nts includ$ 9 gross income by a ,unit$ ,/ates %>ehold] "u section #iea74 7#b7 ,except$ risks ,! t]m except$ risks means any risk ) respect to :i* res]ves describ$ 9 section #haf7;b77#a7 are e/abli%$4 7c7 ,affiliat$ corporations ,= purposes ( ?is section1 a corporation %all be treat$ z affiliat$ ) an insurance company if bo? corporations w\ld be memb]s ( ! same controll$ gr\p ( corporations 7z def9$ 9 section #aefc7;a77 if section #aefc 7 appli$-- 7#a7 by sub/itut+ at lea/ #ej p]c5t = at lea/ #hj p]c5t ea* place x appe>s 9 subsection 7a77#a71 & 7#b7 )\t reg>d to subsections 7a77#d71 7b77#b77;,c71 7b77#b77;,d71 & 7e77#c77;,c74 7d7 ,election ,to treat re9surance income z effectively connect$ 7#a7 ,9 g5]al ,a specifi$ affiliat$ corporation may elect = any taxable ye> to treat specifi$ re9surance income z-- 7,a7 income effectively connect$ ) ! conduct ( a trade or bus9ess 9 ! ,unit$ ,/ates1 & 7,b7 = purposes ( any treaty betwe5 ! ,unit$ ,/ates & any =eign c\ntry1 income attributable to a p]man5t e/abli%m5t 9 ! ,unit$ ,/ates4 7#b7 ,effect ( election ,9 ! case ( any specifi$ re9surance income ) respect to :i* ! election "u ?is subsection applies-- 7,a7 ,d$uction all[$ = re9surance premiums ,= exemption f subsection 7a71 see def9ition ( non-tax$ re9surance premiums 9 subsection 7b74 7,b7 ,exception f excise tax ,! tax impos$ by section #dcga %all n apply ) respect to any income treat$ z effectively connect$ ) ! conduct ( a trade or bus9ess 9 ! ,unit$ ,/ates "u p>agraph 7#a74 7,c7 ,taxation "u ?is sub*apt] ,su* income %all be subject to tax "u ?is sub*apt] to ! same ext5t & 9 ! same mann] z if su* income 7 ! income ( a dome/ic insurance company4 7,d7 ,coord9ation ) =eign tax cr$it provisions ,= purposes ( subp>t ,a ( "p ,,iii ( sub*apt] ,n & sections #gh & #ifj-- 7i7 su* specifi$ re9surance income %all be treat$ z d]iv$ f s\rces )\t ! ,unit$ ,/ates1 & 7ii7 subsections 7a71 7b71 & 7c7 ( section #ijd & sections #ijb1 #ijg1 & #ifj %all be appli$ sep>ately ) respect to ea* item ( su* income4 ,! ,secret>y may issue regulations or o!r guidance :i* provide t relat$ items ( specifi$ re9surance income may be aggregat$ = purposes ( apply+ clause 7ii74 7#c7 ,specifi$ affiliat$ corporation ,= purposes ( ?is subsection1 ! t]m specifi$ affiliat$ corporation means any affiliat$ corporation :i* is a =eign corporation & :i* meets su* requirem5ts z ! ,secret>y %all prescribe to ensure t tax on ! specifi$ re9surance income ( su* corporation is prop]ly det]m9$ & paid4 7#d7 ,specifi$ re9surance income ,= purposes ( ?is p>agraph1 ! t]m specifi$ re9surance income means all income ( a specifi$ affiliat$ corporation :i* is attributable to re9surance ) respect to :i* subsection 7a7 w\ld 7b = ! election "u ?is subsection7 apply4 7#e7 ,rules relat$ to election ,any election "u p>agraph 7#a7 %all-- 7,a7 be made at su* "t & 9 su* =m & mann] z ! ,secret>y may provide1 & 7,b7 apply = ! taxable ye> = :i* made & all subsequ5t taxable ye>s unless revok$ ) ! cons5t ( ! ,secret>y4 7e7 ,regulations ,! ,secret>y %all prescribe su* regulations or o!r guidance z may be appropriate to c>ry out1 or to prev5t ! avoidance ( ! purposes (1 ?is section1 includ+ regulations or o!r guidance :i* provide = ! application ( ?is section to alt]native re9surance transactions1 front+ transactions1 conduit & reciprocal transactions1 & any economically equival5t transactions4 4 7b7 ,cl]ical am5dm5t ,! table ( sections = "p ,,iii ( sub*apt] ,l ( *apt] #a ( su* ,code is am5d$ by add+ at ! end ! foll[+ new item3 ,sec4 #hdi4 ,special rules = re9surance ( non-life contracts ) non-tax$ affiliates4 4 7c7 ,effective date ,! am5dm5t made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjab4 ,b ,re9surance #daa4 ,prev5tion ( avoidance ( tax ?r\gh re9surance ) non-tax$ affiliates 7a7 ,9 g5]al ,"p ,,iii ( sub*apt] ,l ( *apt] #a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new section3 #hdi4 ,special rules = re9surance ( non-life contracts ) non-tax$ affiliates 7a7 ,9 g5]al ,! taxable income "u section #hca7;a7 or ! life insurance company taxable income "u section #hja7;b7 7z ! case may be7 ( an insurance company %all be det]m9$ by n tak+ into acc\nt-- 7#a7 any non-tax$ re9surance premium1 7#b7 any additional am\nt paid by su* insurance company ) respect to ! re9surance = :i* su* non-tax$ re9surance premium is paid1 to ! ext5t su* additional am\nt is prop]ly allocable to su* non-tax$ re9surance premium1 & 7#c7 any return premium1 c$+ commission1 re9surance recov]$1 or o!r am\nt receiv$ by su* insurance company ) respect to ! re9surance = :i* su* non-tax$ re9surance premium is paid1 to ! ext5t su* return premium1 c$+ commission1 re9surance recov]$1 or o!r am\nt is prop]ly allocable to su* non-tax$ re9surance premium4 7b7 ,non-,tax$ re9surance premiums ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m non-tax$ re9surance premium means any re9surance premium paid directly or indirectly to an affiliat$ corporation ) respect to re9surance ( risks 7o!r ?an except$ risks71 to ! ext5t t ! income attributable to ! premium is n subject to tax "u ?is subtitle 7ei!r z ! income ( ! affiliat$ corporation or z am\nts includ$ 9 gross income by a ,unit$ ,/ates %>ehold] "u section #iea74 7#b7 ,except$ risks ,! t]m except$ risks means any risk ) respect to :i* res]ves describ$ 9 section #haf7;b77#a7 are e/abli%$4 7c7 ,affiliat$ corporations ,= purposes ( ?is section1 a corporation %all be treat$ z affiliat$ ) an insurance company if bo? corporations w\ld be memb]s ( ! same controll$ gr\p ( corporations 7z def9$ 9 section #aefc7;a77 if section #aefc 7 appli$-- 7#a7 by sub/itut+ at lea/ #ej p]c5t = at lea/ #hj p]c5t ea* place x appe>s 9 subsection 7a77#a71 & 7#b7 )\t reg>d to subsections 7a77#d71 7b77#b77;,c71 7b77#b77;,d71 & 7e77#c77;,c74 7d7 ,election ,to treat re9surance income z effectively connect$ 7#a7 ,9 g5]al ,a specifi$ affiliat$ corporation may elect = any taxable ye> to treat specifi$ re9surance income z-- 7,a7 income effectively connect$ ) ! conduct ( a trade or bus9ess 9 ! ,unit$ ,/ates1 & 7,b7 = purposes ( any treaty betwe5 ! ,unit$ ,/ates & any =eign c\ntry1 income attributable to a p]man5t e/abli%m5t 9 ! ,unit$ ,/ates4 7#b7 ,effect ( election ,9 ! case ( any specifi$ re9surance income ) respect to :i* ! election "u ?is subsection applies-- 7,a7 ,d$uction all[$ = re9surance premiums ,= exemption f subsection 7a71 see def9ition ( non-tax$ re9surance premiums 9 subsection 7b74 7,b7 ,exception f excise tax ,! tax impos$ by section #dcga %all n apply ) respect to any income treat$ z effectively connect$ ) ! conduct ( a trade or bus9ess 9 ! ,unit$ ,/ates "u p>agraph 7#a74 7,c7 ,taxation "u ?is sub*apt] ,su* income %all be subject to tax "u ?is sub*apt] to ! same ext5t & 9 ! same mann] z if su* income 7 ! income ( a dome/ic insurance company4 7,d7 ,coord9ation ) =eign tax cr$it provisions ,= purposes ( subp>t ,a ( "p ,,iii ( sub*apt] ,n & sections #gh & #ifj-- 7i7 su* specifi$ re9surance income %all be treat$ z d]iv$ f s\rces )\t ! ,unit$ ,/ates1 & 7ii7 subsections 7a71 7b71 & 7c7 ( section #ijd & sections #ijb1 #ijg1 & #ifj %all be appli$ sep>ately ) respect to ea* item ( su* income4 ,! ,secret>y may issue regulations or o!r guidance :i* provide t relat$ items ( specifi$ re9surance income may be aggregat$ = purposes ( apply+ clause 7ii74 7#c7 ,specifi$ affiliat$ corporation ,= purposes ( ?is subsection1 ! t]m specifi$ affiliat$ corporation means any affiliat$ corporation :i* is a =eign corporation & :i* meets su* requirem5ts z ! ,secret>y %all prescribe to ensure t tax on ! specifi$ re9surance income ( su* corporation is prop]ly det]m9$ & paid4 7#d7 ,specifi$ re9surance income ,= purposes ( ?is p>agraph1 ! t]m specifi$ re9surance income means all income ( a specifi$ affiliat$ corporation :i* is attributable to re9surance ) respect to :i* subsection 7a7 w\ld 7b = ! election "u ?is subsection7 apply4 7#e7 ,rules relat$ to election ,any election "u p>agraph 7#a7 %all-- 7,a7 be made at su* "t & 9 su* =m & mann] z ! ,secret>y may provide1 & 7,b7 apply = ! taxable ye> = :i* made & all subsequ5t taxable ye>s unless revok$ ) ! cons5t ( ! ,secret>y4 7e7 ,regulations ,! ,secret>y %all prescribe su* regulations or o!r guidance z may be appropriate to c>ry out1 or to prev5t ! avoidance ( ! purposes (1 ?is section1 includ+ regulations or o!r guidance :i* provide = ! application ( ?is section to alt]native re9surance transactions1 front+ transactions1 conduit & reciprocal transactions1 & any economically equival5t transactions4 4 7b7 ,cl]ical am5dm5t ,! table ( sections = "p ,,iii ( sub*apt] ,l ( *apt] #a ( su* ,code is am5d$ by add+ at ! end ! foll[+ new item3 ,sec4 #hdi4 ,special rules = re9surance ( non-life contracts ) non-tax$ affiliates4 4 7c7 ,effective date ,! am5dm5t made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjab4 ,c ,close loophole = corporate jet depreciation #dba4 ,g5]al aviation aircraft treat$ z #g-ye> prop]ty 7a7 ,9 g5]al ,subp>agraph 7,c7 ( section #afh7;e77#c7 ( ! ,int]nal ,rev5ue ,code ( #aihf 7relat+ to classification ( c]ta9 prop]ty7 is am5d$ by /rik+ & at ! end ( clause 7iv71 by r$esignat+ clause 7v7 z clause 7vi71 & by ins]t+ aft] clause 7iv7 ! foll[+ new clause3 7v7 any g5]al aviation aircraft1 & 4 7b7 ,class life ,p>agraph 7#c7 ( section #afh7;g7 ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ aft] subp>agraph 7,e7 ! foll[+ new subp>agraph3 7,f7 ,g5]al aviation aircraft4 ,9 ! case ( any g5]al aviation aircraft1 ! recov]y p]iod us$ = purposes ( p>agraph 7#b7 %all be #ab ye>s4 4 7c7 ,g5]al aviation aircraft ,subsection 7i7 ( section #afh ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ aft] p>agraph 7#ai7 ! foll[+ new p>agraph3 7#bj7 ,g5]al aviation aircraft ,! t]m g5]al aviation aircraft means any airplane or helicopt] 7includ+ airframes & eng9es7 n us$ 9 comm]cial or contract c>ry+ ( pass5g]s or freight1 b :i* prim>ily engages 9 ! c>ry+ ( pass5g]s4 4 7d7 ,effective date ,?is section %all be effective = prop]ty plac$ 9 s]vice aft] ,decemb] #ca1 #bjab4 ,v ,close ,e/ate ,tax ,loopholes #eja4 ,valuation rules = c]ta9 transf]s ( nonbus9ess assets2 limitation on m9ority disc\nts 7a7 ,9 g5]al ,section #bjca ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by r$esignat+ subsection 7d7 z subsection 7f7 & by ins]t+ aft] subsection 7c7 ! foll[+ new subsections3 7d7 ,valuation rules = c]ta9 transf]s ( nonbus9ess assets ,= purposes ( ?is *apt] & *apt] #ab-- 7#a7 ,9 g5]al ,9 ! case ( ! transf] ( any int]e/ 9 an entity o!r ?an an int]e/ :i* is actively trad$ 7)9 ! mean+ ( section #ajib7-- 7,a7 ! value ( any nonbus9ess assets held by ! entity %all be det]m9$ z if ! transf]or _h transf]r$ su* assets directly to ! transf]ee 7& no valuation disc\nt %all be all[$ ) respect to su* nonbus9ess assets71 & 7,b7 ! nonbus9ess assets %all n be tak5 into acc\nt 9 det]m9+ ! value ( ! int]e/ 9 ! entity4 7#b7 ,nonbus9ess assets ,= purposes ( ?is subsection-- 7,a7 ,9 g5]al ,! t]m nonbus9ess asset means any asset :i* is n us$ 9 ! active conduct ( #a or m trades or bus9esses4 7,b7 ,exception = c]ta9 passive assets ,except z provid$ 9 subp>agraph 7,c71 a passive asset %all n be treat$ = purposes ( subp>agraph 7,a7 z us$ 9 ! active conduct ( a trade or bus9ess unless-- 7i7 ! asset is prop]ty describ$ 9 p>agraph 7#a7 or 7#d7 ( section #abba7;a7 or is a h$ge ) respect to su* prop]ty1 or 7ii7 ! asset is real prop]ty us$ 9 ! active conduct ( #a or m real prop]ty trades or bus9esses 7)9 ! mean+ ( section #dfi7;c77#g77;,c77 9 :i* ! transf]or mat]ially p>ticipates & ) respect to :i* ! transf]or meets ! requirem5ts ( section #dfi7;c77#g77;,b77ii74 ,= purposes ( clause 7ii71 mat]ial p>ticipation %all be det]m9$ "u ! rules ( section #dfi7;h71 except t section #dfi7;h77#c7 %all be appli$ )\t reg>d to ! limitation to f>m+ activity4 7,c7 ,exception = work+ capital ,any asset 7includ+ a passive asset7 :i* is held z a "p ( ! reasonably requir$ work+ capital ne$s ( a trade or bus9ess %all be treat$ z us$ 9 ! active conduct ( a trade or bus9ess4 7#c7 ,passive asset ,= purposes ( ?is subsection1 ! t]m passive asset means any-- 7,a7 ca% or ca% equival5ts1 7,b7 except to ! ext5t provid$ by ! ,secret>y1 /ock 9 a corporation or any o!r equity1 pr(its1 or capital int]e/ 9 any entity1 7,c7 evid5ce ( indebt$ness1 option1 =w>d or futures contract1 notional pr9cipal contract1 or d]ivative1 7,d7 asset describ$ 9 clause 7iii71 7iv71 or 7v7 ( section #cea7;e77#a77;,b71 7,e7 annuity1 7,f7 real prop]ty us$ 9 #a or m real prop]ty trades or bus9esses 7z def9$ 9 section #dfi7;c77#g77;,c771 7,g7 asset 7o!r ?an a pat5t1 tradem>k1 or copyright7 :i* produces royalty income1 7,h7 commodity1 7,i7 collectible 7)9 ! mean+ ( section #dja7m771 or 7,j7 any o!r asset specifi$ 9 regulations prescrib$ by ! ,secret>y4 7#d7 ,look-?ru rules 7,a7 ,9 g5]al ,if a nonbus9ess asset ( an entity consi/s ( a #aj-p]c5t int]e/ 9 any o!r entity1 ?is subsection %all be appli$ by disreg>d+ ! #aj-p]c5t int]e/ & by treat+ ! entity z hold+ directly its ratable %>e ( ! assets ( ! o!r entity4 ,?is subp>agraph %all be appli$ successively to any #aj-p]c5t int]e/ ( su* o!r entity 9 any o!r entity4 7,b7 #aj-p]c5t int]e/ ,! t]m #aj-p]c5t int]e/ means-- 7i7 9 ! case ( an int]e/ 9 a corporation1 own]%ip ( at lea/ #aj p]c5t 7by vote or value7 ( ! /ock 9 su* corporation1 7ii7 9 ! case ( an int]e/ 9 a p>tn]%ip1 own]%ip ( at lea/ #aj p]c5t ( ! capital or pr(its int]e/ 9 ! p>tn]%ip1 & 7iii7 9 any o!r case1 own]%ip ( at lea/ #aj p]c5t ( ! b5eficial int]e/s 9 ! entity4 7,c7 ,exception = actively trad$ int]e/s ,subp>agraph 7,a7 %all n apply to any nonbus9ess asset :i* consi/s ( an int]e/ :i* is actively trad$ 7)9 ! mean+ ( section #ajib74 7#e7 ,coord9ation ) subsection 7b7 ,subsection 7b7 %all apply aft] ! application ( ?is subsection4 7e7 ,limitation on m9ority disc\nts ,= purposes ( ?is *apt] & *apt] #ab1 9 ! case ( ! transf] ( any int]e/ 9 an entity o!r ?an an int]e/ :i* is actively trad$ 7)9 ! mean+ ( section #ajib71 no disc\nt %all be all[$ by reason ( ! fact t ! transf]ee does n h control ( su* entity if ! transf]ee & memb]s ( ! family 7z def9$ 9 section #bjcb;,a7e77#b77 ( ! transf]ee h control ( su* entity 7det]m9$ imm$iately aft] su* transf]74 4 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to transf]s aft] ! date ( ! enactm5t ( ?is ,act4 #ejb4 ,consi/5t basis report+ betwe5 e/ate & p]son acquir+ prop]ty f dec$5t 7a7 ,consi/5t use ( basis 7#a7 ,prop]ty acquir$ f a dec$5t ,section #ajad ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7f7 ,basis mu/ be consi/5t ) e/ate tax return 7#a7 ,9 g5]al ,= purposes ( ?is section1 ! value us$ to det]m9e ! basis ( any int]e/ 9 prop]ty 9 ! h&s ( ! p]son acquir+ su* prop]ty %all n exce$ ! value ( su* int]e/ z f9ally det]m9$ = purposes ( *apt] #aa4 7#b7 ,special rule :]e no f9al det]m9ation ,9 any case 9 :i* ! f9al value ( prop]ty has n be5 det]m9$ "u *apt] #aa & !re has be5 a /atem5t furni%$ "u section #fjce7;a71 ! value us$ to det]m9e ! basis ( any int]e/ 9 prop]ty 9 ! h&s ( ! p]son acquir+ su* prop]ty %all n exce$ ! am\nt report$ on any /atem5t furni%$ "u section #fjce7;a74 7#c7 ,regulations ,! ,secret>y may by regulations provide exceptions to ! application ( ?is subsection4 4 7#b7 ,prop]ty acquir$ by gifts & transf]s 9 tru/ ,section #ajae ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7f7 ,basis mu/ be consi/5t gift tax return 7#a7 ,9 g5]al ,= purposes ( ?is section1 ! value us$ to det]m9e ! basis ( any int]e/ 9 prop]ty 9 ! h&s ( ! p]son acquir+ su* prop]ty %all n exce$ ! value ( su* int]e/ z f9ally det]m9$ = purposes ( *apt] #ab4 7#b7 ,special rule :]e no f9al det]m9ation ,9 any case 9 :i* ! f9al value ( prop]ty has n be5 det]m9$ "u *apt] #ab & !re has be5 a /atem5t furni%$ "u section #fjce7;b71 ! value us$ to det]m9e ! basis ( any int]e/ 9 prop]ty 9 ! h&s ( ! p]son acquir+ su* prop]ty %all n exce$ ! am\nt report$ on any /atem5t furni%$ "u section #fjce7;b74 7#c7 ,regulations ,! ,secret>y may by regulations provide exceptions to ! application ( ?is subsection4 4 7b7 ,in=mation report+ 7#a7 ,9 g5]al ,subp>t ,a ( "p ,,iii ( sub*apt] ,a ( *apt] #fa ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ aft] section #fjcd;,a ! foll[+ new section3 #fjce4 ,basis in=mation to p]sons acquir+ prop]ty f dec$5t or by gift 7a7 ,in=mation ) respect to prop]ty acquir$ f dec$5ts 7#a7 ,9 g5]al ,! executor ( any e/ate requir$ to file a return "u section #fjah7;a7 %all furni% to ! ,secret>y & to ea* p]son acquir+ any int]e/ 9 prop]ty includ$ 9 ! dec$5t's gross e/ate = ,f$]al e/ate tax purposes a /atem5t id5tify+ ! value ( ea* int]e/ 9 su* prop]ty z report$ on su* return & su* o!r in=mation ) respect to su* int]e/ z ! ,secret>y may prescribe4 7#b7 ,/atem5ts by b5efici>ies ,ea* p]son requir$ to file a return "u section #fjah7;b7 %all furni% to ! ,secret>y & to ea* o!r p]son :o holds a legal or b5eficial int]e/ 9 ! prop]ty to :i* su* return relates a /atem5t id5tify+ ! in=mation describ$ 9 p>agraph 7#a74 7#c7 ,"t = furni%+ /atem5t 7,a7 ,9 g5]al ,ea* /atem5t requir$ to be furni%$ "u p>agraph 7#a7 or 7#b7 %all be furni%$ at su* "t z ! ,secret>y may prescribe1 b 9 no case at a "t lat] ?an ! e>li] (-- 7i7 ! date :i* is #cj days aft] ! date on :i* ! return "u section #fjah 0 requir$ to be fil$ 7includ+ ext5sions1 if any71 or 7ii7 ! date :i* is #cj days aft] ! date su* return is fil$4 7,b7 ,adju/m5ts ,9 any case 9 :i* !re is an adju/m5t to ! in=mation requir$ to be includ$ on a /atem5t fil$ "u p>agraph 7#a7 or 7#b7 aft] su* /atem5t has be5 fil$1 a supplem5tal /atem5t "u su* p>agraph %all be fil$ n lat] ?an ! date :i* is #cj days aft] su* adju/m5t is made4 7b7 ,in=mation ) respect to prop]ty acquir$ by gift 7#a7 ,9 g5]al ,ea* p]son mak+ a transf] by gift :o is requir$ to file a return "u section #fjai ) respect to su* transf] %all furni% to ! ,secret>y & to ea* p]son acquir+ any int]e/ 9 prop]ty by reason ( su* transf] a /atem5t id5tify+ ! value ( ea* int]e/ 9 su* prop]ty z report$ on su* return & su* o!r in=mation ) respect to su* int]e/ z ! ,secret>y may prescribe4 7#b7 ,"t = furni%+ /atem5t 7,a7 ,9 g5]al ,ea* /atem5t requir$ to be furni%$ "u p>agraph 7#a7 %all be furni%$ at su* "t z ! ,secret>y may prescribe1 b 9 no case at a "t lat] ?an ! e>li] (-- 7i7 ! date :i* is #cj days aft] ! date on :i* ! return "u section #fjai 0 requir$ to be fil$ 7includ+ ext5sions1 if any71 or 7ii7 ! date :i* is #cj days aft] ! date su* return is fil$4 7,b7 ,adju/m5ts ,9 any case 9 :i* !re is an adju/m5t to ! in=mation requir$ to be includ$ on a /atem5t fil$ "u p>agraph 7#a7 aft] su* /atem5t has be5 fil$1 a supplem5tal /atem5t "u su* p>agraph %all be fil$ n lat] ?an ! date :i* is #cj days aft] su* adju/m5t is made4 7c7 ,regulations ,! ,secret>y %all prescribe su* regulations z necess>y to c>ry out ?is section1 includ+ regulations relat+ to-- 7#a7 ! application ( ?is section to prop]ty ) reg>d to :i* no e/ate or gift tax return is requir$ to be fil$1 & 7#b7 situations 9 :i* ! surviv+ jo9t t5ant or o!r recipi5t may h bett] in=mation ?an ! executor reg>d+ ! basis or fair m>ket value ( ! prop]ty4 4 7#b7 ,p5alty = failure to file 7,a7 ,return ,section #fgbd7;d77#a7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ & at ! end ( subp>agraph 7,b71 by /rik+ ! p]iod at ! end ( subp>agraph 7,c7 & ins]t+ 1 &1 & by add+ at ! end ! foll[+ new subp>agraph3 7,d7 any /atem5t requir$ to be fil$ ) ! ,secret>y "u section #fjce4 4 7,b7 ,/atem5t ,section #fgbd7;d77#b7 ( su* ,code is am5d$ by /rik+ or at ! end ( subp>agraph 7,,gg71 by /rik+ ! p]iod at ! end ( subp>agraph 7,,hh7 & ins]t+ 1 or1 & by add+ at ! end ! foll[+ new subp>agraph3 7,,ii7 section #fjce 7o!r ?an a /atem5t describ$ 9 p>agraph 7#a77;,d774 4 7#c7 ,cl]ical am5dm5t ,! table ( sections = subp>t ,a ( "p ,,iii ( sub*apt] ,a ( *apt] #fa ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ aft] ! item relat+ to section #fjcd;,a ! foll[+ new item3 ,sec4 #fjce4 ,basis in=mation to p]sons acquir+ prop]ty f dec$5t or by gift4 4 7c7 ,p5alty = inconsi/5t report+ 7#a7 ,9 g5]al ,subsection 7b7 ( section #fffb ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by ins]t+ aft] p>agraph 7#g7 ! foll[+ new p>agraph3 7#h7 ,any inconsi/5t e/ate or gift basis4 4 7#b7 ,inconsi/5t basis report+ ,section #fffb ( su* ,code is am5d$ by add+ at ! end ! foll[+ new subsection3 7k7 ,inconsi/5t e/ate or gift basis report+ ,= purposes ( ?is section1 ! t]m inconsi/5t e/ate or gift basis means ! portion ( ! und]/atem5t :i* is attributable to-- 7#a7 9 ! case ( prop]ty acquir$ f a dec$5t1 a basis det]m9ation ) respect to su* prop]ty :i* is n consi/5t ) ! value ( su* prop]ty z det]m9$ "u section #ajad7;f71 & 7#b7 9 ! case ( prop]ty acquir$ by gift1 a basis det]m9ation ) respect to su* prop]ty :i* is n consi/5t ) ! value ( su* prop]ty z det]m9$ "u section #ajae7;f74 4 7d7 ,effective date ,! am5dm5ts made by ?is section %all apply to transf]s = :i* returns are fil$ aft] ! date ( ! enactm5t ( ?is ,act4 #ejc4 ,requir$ m9imum #aj-ye> t]m1 etc41 = grantor reta9$ annuity tru/s 7a7 ,9 g5]al ,subsection 7b7 ( section #bgjb ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$-- 7#a7 by r$esignat+ p>agraphs 7#a71 7#b7 & 7#c7 z subp>agraphs 7,a71 7,b71 & 7,c71 respectively1 & by mov+ su* subp>agraphs 7z s r$esignat$7 #b ems to ! "r2 7#b7 by /rik+ ,= purposes ( & ins]t+ ! foll[+3 7#a7 ,9 g5]al ,= purposes ( 2 7#c7 by /rik+ p>agraph 7#a7 or 7#b7 9 p>agraph 7#a77;,c7 7z s r$esignat$7 & ins]t+ subp>agraph 7,a7 or 7,b72 & 7#d7 by add+ at ! end ! foll[+ new p>agraph3 7#b7 ,additional requirem5ts ) respect to grantor reta9$ annuities ,= purposes ( subsection 7a71 9 ! case ( an int]e/ describ$ 9 p>agraph 7#a77;,a7 7det]m9$ )\t reg>d to ?is p>agraph7 :i* is reta9$ by ! transf]or1 su* int]e/ %all be treat$ z describ$ 9 su* p>agraph only if-- 7,a7 ! "r to receive ! fix$ am\nts ref]r$ to 9 su* p>agraph is = a t]m ( n less ?an #aj ye>s1 7,b7 su* fix$ am\nts1 :5 det]m9$ on an annual basis1 d n decrease relative to any prior ye> dur+ ! fir/ #aj ye>s ( ! t]m ref]r$ to 9 subp>agraph 7,a71 & 7,c7 ! rema9d] int]e/ has a value great] ?an z]o det]m9$ z ( ! "t ( ! transf]4 4 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to transf]s made aft] ! date ( ! enactm5t ( ?is ,act4 #ejd4 ,limitation on ,,g/ exemption ( p]petual dyna/y tru/s 7a7 ,9 g5]al ,section #bfdb ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new subsection3 7h7 ,expiration ( ,,g/ exemption #ij ye>s aft] e/abli%m5t ( tru/ 7#a7 ,9 g5]al ,9 ! case ( any g5]ation-skipp+ transf] made f a tru/ aft] ! date :i* is #ij ye>s aft] ! date on :i* su* tru/ is creat$1 ! inclusion ratio ) respect to any prop]ty transf]r$ 9 su* transf] %all be #a4 7#b7 ,special rules ,= purposes ( ?is subsection-- 7,a7 ,date ( creation ( c]ta9 deem$ sep>ate tru/s ,9 ! case ( any portion ( a tru/ :i* is treat$ z a sep>ate tru/ "u section #bfed7;b77#a71 su* sep>ate tru/ %all be treat$ z creat$ on ! date ( ! fir/ transf] describ$ 9 su* section ) respect to su* sep>ate tru/4 7,b7 ,date ( creation ( p\r-ov] tru/s ,9 ! case ( any g5]ation-skipp+ transf] ( prop]ty :i* involves ! transf] ( prop]ty f #a tru/ to ano!r tru/1 ! date ( ! creation ( ! transf]ee tru/ %all be treat$ z be+ ! e>li] (-- 7i7 ! date ( ! creation ( su* transf]ee tru/1 or 7ii7 ! date ( ! creation ( ! transf]or tru/4 ,9 ! case ( multiple transf]s to :i* ! prec$+ s5t5ce applies1 ! date ( ! creation ( ! transf]or tru/ %all be det]m9$ "u ! prec$+ s5t5ce be=e ! application ( ! prec$+ s5t5ce to det]m9e ! date ( ! creation ( ! transf]ee tru/4 7,c7 ,exception = c]ta9 transf]s = education & m$ical exp5ses ,subp>agraph 7,b7 %all n apply to ! transf] ( prop]ty f #a tru/ to ano!r tru/ if-- 7i7 su* transf] is describ$ 9 section #bfdb7;c77#b71 & 7ii7 ! individual ref]r$ to 9 su* section ) respect to ! transf]ee tru/ 0 also a b5efici>y ( ! transf]or tru/4 7#c7 ,regulations ,! ,secret>y may prescribe su* regulations or o!r guidance z may be necess>y or appropriate to c>ry out ?is subsection4 4 7b7 ,effective date 7#a7 ,9 g5]al ,! am5dm5ts made ?is section %all apply to-- 7,a7 tru/s creat$ aft] ! date ( ! enactm5t ( ?is ,act1 & 7,b7 g5]ation-skipp+ transf]s made f tru/s creat$ on or be=e su* date1 b only to ! ext5t su* transf] is made out ( corpus add$ to ! tru/ aft] su* date 7or out ( income attributable to corpus s add$74 7#b7 ,det]m9ation ( date ( creation ,= purposes ( ?is subsection1 ! rules ( sections #bfdb7;h77#b7 7z add$ by ?is section7 & #bfed7;b7 ( ! ,int]nal ,rev5ue ,code ( #aihf %all apply = purposes ( det]m9+ ! date ( ! creation ( any tru/4 7#c7 ,exceptions ,! ,secret>y ( ! ,treasury1 or 8 designee1 %all issue regulations or o!r guidance :i* provide exceptions to ! application ( ! am5dm5ts made by ?is section :i* are sub/antially simil> to ! relevant exceptions "u p>agraph 7#b7 ( section #adcc7;b7 ( ! ,tax ,re=m ,act ( #aihf4 ,,vi ,cut ,p5tagon ,wa/e to ,a*ieve ,balance ,a ,sm>t] ,approa* to nucle> ,exp5ditures #fja4 ,%ort title ,?is title may be cit$ z ! ,sm>t] ,approa* to ,nucle> ,exp5ditures ,act4 #fjb4 ,f9d+s ,congress f9ds ! foll[+3 7#a7 ,! ,b]l9 ,wall fell 9 #aihi1 ! ,u4,s4,s4,r4 no long] exi/s1 & ! ,cold ,w> is ov]4 ,! nature ( ?reats to ! national security & milit>y int]e/s ( ! ,unit$ ,/ates has *ang$4 ,h[ev]1 ! ,unit$ ,/ates cont9ues to ma9ta9 an enorm\s ars5al ( nucle> weapons & deliv]y sy/ems t 7 devis$ ) ! ,cold ,w> 9 m9d4 7#b7 ,! curr5t nucle> ars5al ( ! ,unit$ ,/ates includes approximately #e1jjj total nucle> w>heads1 ( :i* approximately #b1jjj are deploy$ ) ?ree deliv]y compon5ts3 long-range /rategic bomb] aircraft1 l&-bas$ int]cont95tal balli/ic missiles1 & subm>9e-laun*$ balli/ic missiles4 ,! bomb] fleet ( ! ,unit$ ,/ates comprises #ic ,b-#eb & #bj ,b-#b aircraft4 ,! ,unit$ ,/ates ma9ta9s #dej int]cont95tal balli/ic missiles4 ,! ,unit$ ,/ates also ma9ta9s #ad ,ohio-class subm>9es1 up to #ab ( :i* are deploy$ at sea4 ,ea* ( ^! subm>9es is arm$ ) up to #if indep5d5tly t>getable nucle> w>heads4 7#c7 ,?is ,cold ,w>-bas$ approa* to nucle> security comes at significant co/4 ,ov] ! next #aj ye>s1 ! ,unit$ ,/ates w sp5d hundr$s ( billions ( doll>s ma9ta9+ its nucle> =ce4 ,a sub/antial decrease 9 ! nucle> ars5al ( ! ,unit$ ,/ates is prud5t = bo? ! budget & national security4 7#d7 ,! national security int]e/s ( ! ,unit$ ,/ates c be well s]v$ by r$uc+ ! total numb] ( deploy$ nucle> w>heads & _! deliv]y sy/ems1 z sugge/$ by ! ,dep>tm5t ( ,def5se's ,janu>y #bjab /rategic guidance titl$ ,su/a9+ ,u4,s4 ,global ,lead]%ip3 ,priorities = #ba/ ,c5tury ,def5se4 ,fur!rmore1 a numb] ( arms control1 nucle>1 & national security exp]ts h urg$ ! ,unit$ ,/ates to r$uce ! numb] ( deploy$ nucle> w>heads to no m ?an #a1jjj4 7#e7 ,economic security & national security are l9k$ & bo? w be well s]v$ by sm>t def5se sp5d+4 ,admiral ,mike ,mull51 ,*airman ( ! ,jo9t ,*iefs ( ,/aff1 /at$ on ,june #bd1 #bjaj1 t ,our national debt is our bigge/ national security ?reat & on ,augu/ #b1 #bjaa1 /at$ t ,i hav5't *ang$ my view t ! cont9ually increas+ debt is ! bigge/ ?reat we h to our national security44 7#f7 ,! ,gov]nm5t ,acc\ntability ,(fice has f\nd t !re is significant wa/e 9 ! con/ruction ( ! nucle> facilities ( ! ,national ,nucle> ,security ,adm9i/ration ( ! ,dep>tm5t ( ,en]gy4 #fjc4 ,r$uction 9 nucle> =ces 7a7 ,prohibition on use ( ,b-#b & ,b-#eb aircraft = nucle> missions ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ to arm a ,b-#b or ,b-#eb aircraft ) a nucle> weapon4 7b7 ,prohibition on new long-,range p5etrat+ bomb] aircraft ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = any ( fiscal ye>s #bjad ?r\gh #bjbd = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ = ! rese>*1 developm5t1 te/1 & evaluation or procurem5t ( a long-range p5etrat+ bomb] aircraft4 7c7 ,prohibition on ,f-#ce nucle> mission ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se or ! ,dep>tm5t ( ,en]gy may be us$ to make ! ,f-#ce ,jo9t ,/rike ,fight] aircraft capable ( c>ry+ nucle> weapons4 7d7 ,t]m9ation ( ,b#fa ,,lep ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se or ! ,dep>tm5t ( ,en]gy may be obligat$ or exp5d$ = ! ,b#fa life ext5sion program4 7e7 ,t]m9ation ( ,w#gh ,,lep ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se or ! ,dep>tm5t ( ,en]gy may be obligat$ or exp5d$ = ! ,w#gh life ext5sion program4 7f7 ,r$uction ( nucle>-,arm$ subm>9es ,not)/&+ any o!r provision ( law1 beg9n+ 9 fiscal ye> #bjad1 ! =ces ( ! ,navy %all include n m ?an eight op]ational balli/ic-missile subm>9es available = deploym5t4 7g7 ,limitation on ,,ssbn-,x subm>9es ,not)/&+ any o!r provision ( law-- 7#a7 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = any ( fiscal ye>s #bjad ?r\gh #bjbd = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ = ! procurem5t ( an ,,ssbn-,x subm>9e2 & 7#b7 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjbe or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ = ! procurem5t ( m ?an eight su* subm>9es4 7h7 ,r$uction ( ,i,c,b,ms ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ to ma9ta9 m ?an #bjj int]cont95tal balli/ic missiles4 7i7 ,r$uction ( ,s,l,b,ms ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ to ma9ta9 m ?an #bej subm>9e-laun*$ balli/ic missiles4 7j7 ,prohibition on new ,,icbm ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ = ! rese>*1 developm5t1 te/1 & evaluation or procurem5t ( a new int]cont95tal balli/ic missile4 7k7 ,t]m9ation ( ,,mox fuel plant project ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se or ! ,dep>tm5t ( ,en]gy may be obligat$ or exp5d$ = ! ,mix$ ,oxide 7,,mox7 ,fuel ,fabrication ,facility project4 7l7 ,t]m9ation ( ,,cmrr project ,not)/&+ section #dbae ( ! ,atomic ,en]gy ,def5se ,act or any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se or ! ,dep>tm5t ( ,en]gy may be obligat$ or exp5d$ = ! ,*emi/ry & ,metallurgy ,rese>* ,replacem5t nucle> facility4 7m7 ,t]m9ation ( ,,upf ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se or ! ,dep>tm5t ( ,en]gy may be obligat$ or exp5d$ = ! ,uranium ,process+ ,facility locat$ at ! ,y-#ab ,national ,security ,complex4 7n7 ,t]m9ation ( ,,meads ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ = ! m$ium ext5d$ air def5se sy/em4 #fjd4 ,reports requir$ 7a7 ,initial report ,n lat] ?an #ahj days aft] ! date ( ! enactm5t ( ?is ,act1 ! ,secret>y ( ,def5se & ! ,secret>y ( ,en]gy %all jo9tly submit to ! appropriate committees ( ,congress a report outl9+ ! plan ( ea* ,secret>y to c>ry out section #fjc4 7b7 ,annual report ,n lat] ?an ,m>* #a1 #bjad1 & ea* ye> !reaft]1 ! ,secret>y ( ,def5se & ! ,secret>y ( ,en]gy %all jo9tly submit to ! appropriate committees ( ,congress a report outl9+ ! plan ( ea* ,secret>y to c>ry out section #fjc1 includ+ any updates to previ\sly submitt$ reports4 7c7 ,annual nucle> weapons acc\nt+ ,n lat] ?an ,septemb] #cj1 #bjad1 & ea* ye> !reaft]1 ! ,presid5t %all transmit to ! appropriate committees ( ,congress a report conta9+ a compreh5sive acc\nt+ by ! ,director ( ! ,(fice ( ,managem5t & ,budget ( ! am\nts obligat$ & exp5d$ by ! ,f$]al ,gov]nm5t = ea* nucle> weapon & relat$ nucle> program dur+-- 7#a7 ! fiscal ye> cov]$ by ! report2 & 7#b7 ! life cycle ( su* weapon or program4 7d7 ,appropriate committees ( ,congress def9$ ,9 ?is section1 ! t]m appropriate committees ( ,congress means-- 7#a7 ! ,committee on ,arm$ ,s]vices1 ! ,committee on ,=eign ,relations1 ! ,committee on ,appropriations1 & ! ,committee on ,en]gy & ,natural ,res\rces ( ! ,s5ate2 & 7#b7 ! ,committee on ,arm$ ,s]vices1 ! ,committee on ,=eign ,affairs1 ! ,committee on ,appropriations1 ! ,committee on ,en]gy & ,comm]ce1 & ! ,committee on ,natural ,res\rces ( ! ,h\se ( ,repres5tatives4 ,b ,limit+ ,excessive ,contractor ,comp5sation #faa4 ,limitation on all[able comp5sation co/s 7a7 ,limitation 7#a7 ,civilian contracts ,section #dcjd7;a77#af7 ( title #da1 ,unit$ ,/ates ,code1 is am5d$ to read z foll[s3 7#af7 ,co/s ( comp5sation ( contractor & subcontractor employees = a fiscal ye>1 reg>dless ( ! contract fund+ s\rce1 to ! ext5t t su* comp5sation exce$s ! rate payable = level ,i ( ! ,executive ,s*$ule "u section #ecab ( title #e4 4 7#b7 ,def5se contracts ,section #bcbd7;e77#a77,p7 ( title #aj1 ,unit$ ,/ates ,code1 is am5d$ to read z foll[s3 7,p7 ,co/s ( comp5sation ( contractor & subcontractor employees = a fiscal ye>1 reg>dless ( ! contract fund+ s\rce1 to ! ext5t t su* comp5sation exce$s ! rate payable = level ,i ( ! ,executive ,s*$ule "u section #ecab ( title #e4 4 7b7 ,con=m+ am5dm5ts 7#a7 ,9 g5]al ,section #aabg ( title #da1 ,unit$ ,/ates ,code1 is h]eby repeal$4 7#b7 ,cl]ical am5dm5t ,! table ( sections at ! beg9n+ ( *apt] #aa ( title #da1 ,unit$ ,/ates ,code1 is am5d$ by /rik+ ! item relat+ to section #aabg4 ,c ,relocate ,troops ,f ,europe to ! ,unit$ ,/ates #fae4 ,relocation to ,unit$ ,/ates milit>y in/allations ( memb]s ( ! ,unit$ ,/ates ,arm$ ,=ces assign$ to p]man5t duty 9 ,europe 7a7 ,relocation requir$ ,n lat] ?an "o ye> aft] ! date ( ! enactm5t ( ?is ,act1 ! ,secret>y ( ,def5se %all complete ! relocation to milit>y in/allations 9 ! ,unit$ ,/ates ( at lea/ #aj1jjj memb]s ( ! ,arm$ ,=ces ( ! ,unit$ ,/ates :o1 z ( ! date ( ! enactm5t ( ?is ,act1 are assign$ to p]man5t duty a%ore 9 ,europe4 ,! memb]s relocat$ %all n be replac$ by ! assignm5t ( o!r memb]s ( ! ,arm$ ,=ces ( ! ,unit$ ,/ates to p]man5t duty a%ore 9 ,europe4 7b7 ,exclusion ( c]ta9 memb]s ,= purposes ( comply+ ) ?is section1 ! ,secret>y ( ,def5se %all n select memb]s ( ! ,arm$ ,=ces p]=m+ ! foll[+ assignm5ts = relocation to ! ,unit$ ,/ates3 7#a7 ,memb]s assign$ to p]man5t duty a%ore 9 ,icel&1 ,gre5l&1 & ! ,azores4 7#b7 ,memb]s p]=m+ duties 9 ,europe = m ?an #agi days "u a milit>y-to-milit>y contact program "u section #afh ( title #aj1 ,unit$ ,/ates ,code4 7c7 ,exceptions2 waiv] ,?is section %all n apply 9 ! ev5t ( a decl>ation ( w> or an arm$ attack on any ,european memb] nation ( ! ,nor? ,atlantic ,treaty ,organization4 ,! ,presid5t may waive op]ation ( ?is section if ! ,presid5t decl>es an em]g5cy & imm$iately in=ms ! ,congress ( ! waiv] & ! reasons !re=4 7d7 ,con=m+ am5dm5t to p]man5t ceil+ on ,unit$ ,/ates milit>y pres5ce 9 ,europe ,section #ajjb7;c77#a7 ( ! ,dep>tm5t ( ,def5se ,au?orization ,act1 #aihe 7#bb ,u4,s4,c4 #aibh note7 is am5d$ by /rik+ #ajj1jjj & ins]t+ #fj1jjj4 ,d ,additional r$uction 9 arm$ =ces end /r5g? levels #fba4 ,additional ,army & ,m>9e ,corps end /r5g? r$uctions ?r\gh retirem5t & sep>ation 7a7 ,army ,9 addition to ! r$uctions 9 end /r5g? levels ( active duty memb]s ( ! ,army o!rwise requir$ to be a*iev$ dur+ fiscal ye>s #bjac ?r\gh #bjag1 ! ,secret>y ( ! ,army %all r$uce ! end /r5g? numb]s = active duty p]sonnel z ( ! end ( fiscal ye> #bjag by an additional #bj1jjj4 7b7 ,m>9e ,corps ,9 addition to ! r$uctions 9 end /r5g? levels ( active duty memb]s ( ! ,m>9e ,corps o!rwise requir$ to be a*iev$ dur+ fiscal ye>s #bjac ?r\gh #bjag1 ! ,secret>y ( ! ,navy %all r$uce ! end /r5g? numb]s = active duty p]sonnel z ( ! end ( fiscal ye> #bjag by an additional #g1jjj4 7c7 ,me?ods ( a*iev+ r$uctions ,to a*ieve ! p]sonnel r$uctions requir$ by subsections 7a7 & 7b71 ! ,secret>y ( ! ,army & ! ,secret>y ( ! ,navy %all rely on ! retirem5t & sep>ation ( memb]s ( ! ,army & ,m>9e ,corps1 includ+ z a result ( ! use ( enhanc$ selective e>ly retirem5t bo>ds & e>ly dis*>ges "u section #fch;a ( title #aj1 ,unit$ ,/ates ,code1 z re9/at$ by section #ejb ( ! ,national ,def5se ,au?orization ,act = ,fiscal ,ye> #bjac 7,public ,law #aab-bci74 ,e ,procurem5t ( c]ta9 subm>9es1 c>ri]s1 & aircraft #fca4 ,limitation on procurem5t ( ,virg9ia class subm>9es ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye>s #bjad ?r\gh #bjbd = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ to procure m ?an "o ,virg9ia class subm>9e p] fiscal ye>4 #fcb4 ,limitation on procurem5t ( "o ,=d class aircraft c>ri] 7a7 ,limitation ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ to procure ! ,=d class aircraft c>ri] designat$ ,,cvn-#hj4 7b7 ,effect on requirem5t = #aa op]ational aircraft c>ri]s ,subsection 7a7 applies ev5 9 ! ev5t t ! numb] ( op]ational aircraft c>ri]s = ! naval combat =ces ( ! ,navy becomes less ?an #aa1 not)/&+ section #ejfe7;b7 ( title #aj1 ,unit$ ,/ates ,code4 #fcc4 ,au?ority = procurem5t ( ,f_/,a-#ah;,e & ,f_/,a-#ah;,f aircraft 7a7 ,replacem5t ( plann$ procurem5t ( ,f-#ce;,c aircraft 7#a7 ,limitation on procurem5t ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ to procure ! #bcg ,f-#ce;,c aircraft t ! ,secret>y ( ! ,navy plann$ to procure z ( ! date on :i* ! budget ( ! ,presid5t 0 submitt$ to ,congress "u section #aaje7;a7 ( title #ca1 ,unit$ ,/ates ,code1 = fiscal ye> #bjac4 7#b7 ,au?ority = procurem5t ,( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se1 ! ,secret>y ( ! ,navy may procure n m ?an a total ( #bdj ,f_/,a-#ah;,e & ,f_/,a-#ah;,f aircraft4 7b7 ,replacem5t ( procurem5t ( ,f-#ce;,b aircraft 7#a7 ,limitation on procurem5t ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ to procure m ?an #bjj ,f-#ce;,b aircraft4 7#b7 ,au?ority = procurem5t ,( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se1 ! ,secret>y ( ! ,navy may procure n m ?an a total ( #bbj ,f_/,a-#ah;,e & ,f_/,a-#ah;,f aircraft4 #fcd4 ,prohibition on procurem5t ( ,v-#bb ,osprey aircraft ,not)/&+ any o!r provision ( law1 none ( ! funds au?oriz$ to be appropriat$ or o!rwise made available = fiscal ye> #bjad or any fiscal ye> !reaft] = ! ,dep>tm5t ( ,def5se may be obligat$ or exp5d$ = ! procurem5t ( ,v-#bb ,osprey aircraft4 ,f ,limit ,milit>y ,b&s #fda4 ,limitation on exp5ditures = milit>y musical units ,am\nts exp5d$ = any fiscal ye> = milit>y musical units 7z def9$ 9 section #igd ( title #aj1 ,unit$ ,/ates ,code7 may n exce$ #bjj1jjj1jjj4 ,g ,r$uction 9 ,numb] ( ,g5]al & ,flag ,(fic]s #fea4 ,return ( maximum numb] ( g5]al & flag (fic]s to ,cold ,w> levels ,section #ebf ( title #aj1 ,unit$ ,/ates ,code1 is am5d$ by add+ at ! end ! foll[+ new subsection3 7i7 ,additional limitation /at$ z ratio ( memb]s on active duty ,not)/&+ any o!r provision ( ?is section1 ! numb] ( g5]al (fic]s on active duty 9 ! ,army1 ,air ,=ce1 or ,m>9e ,corps1 & ! numb] ( flag (fic]s on active duty 9 ! ,navy1 may n exce$ six g5]al (fic]s or flag (fic]s = ea* #aj1jjj memb]s ( t arm$ =ce on active duty4 4 ,h ,audit ! ,p5tagon #ffa4 ,purposes ,! purposes ( ?is subtitle are z foll[s3 7#a7 ,to /r5g!n ,am]ican national security by ensur+ t-- 7,a7 milit>y plann+1 op]ations1 weapons developm5t1 & a long-t]m national security /rategy are connect$ to s\nd f9ancial controls2 & 7,b7 def5se doll>s are sp5t effici5tly4 7#b7 ,to in/ill a culture ( acc\ntability at ! ,dep>tm5t ( ,def5se t supports ! va/ majority ( d$icat$ memb]s ( ! ,arm$ ,=ces & civilians :o want to ensure prop] acc\nt+ & prev5t wa/e1 fraud1 & abuse4 #ffb4 ,f9d+s ,congress f9ds ! foll[+3 7#a7 ,! #bjaa ,f9ancial ,report ( ! ,unit$ ,/ates ,gov]nm5t f\nd t #cb ( #ce major ,f$]al ag5cies receiv$ clean audit op9ions4 ,two m1 ! ,dep>tm5t ( ,homel& ,security & ! ,dep>tm5t ( ,/ate1 receiv$ qualifi$ audit op9ions b are mak+ progress4 ,only ! ,dep>tm5t ( ,def5se _h a disclaim] because x lack$ any auditable report+ or acc\nt+ available = indep5d5t review4 7#b7 ,! f9ancial managem5t ( ! ,dep>tm5t ( ,def5se has be5 on ! ,high-,risk li/ ( ! ,gov]nm5t ,acc\ntability ,(fice 7,,gao74 ,! ,,gao f\nd t ! ,dep>tm5t is n consi/5tly able to control co/s2 ensure basic acc\ntability2 anticipate future co/s & claims on ! budget2 measure p]=mance2 ma9ta9 funds control2 & prev5t & detect fraud1 wa/e1 & abuse4 7#c7 ,at a ,septemb] #bjaj he>+ ( ! ,s5ate1 ! ,gov]nm5t ,acc\ntability ,(fice /at$ t pa/ exp5ditures by ! ,dep>tm5t ( ,def5se ( #e1hjj1jjj1jjj to improve f9ancial in=mation1 & billions ( doll>s m ( anticipat$ exp5ditures on new in=mation te*nology sy/ems = t purpose1 may n suffice to a*ieve full audit read9ess ( ! f9ancial /atem5t ( ! ,dep>tm5t4 ,at t he>+1 ! ,gov]nm5t ,acc\ntability ,(fice c\ld n pr$ict :5 ! ,dep>tm5t w\ld a*ieve full audit read9ess ( su* /atem5ts4 7#d7 ,section #i ( article ,i ( ! ,con/itution ( ! ,unit$ ,/ates requires all ag5cies ( ! ,f$]al ,gov]nm5t1 includ+ ! ,dep>tm5t ( ,def5se1 to publi% a regul> /atem5t & acc\nt ( ! receipts & exp5ditures ( all public money4 7#e7 ,section #cjc7;d7 ( ! ,*ief ,f9ancial ,(fic]s ,act ( #aiij 7,public ,law #aja-egf7 requir$ t f9ancial /atem5ts be prep>$ & indep5d5tly audit$ = ! ,dep>tm5t ( ! ,army by ,m>* #ca1 #aiib1 & = ! ,dep>tm5t ( ! ,air ,=ce by ,m>* #ca1 #aiic4 ,nei!r ! ,dep>tm5t ( ! ,army nor ! ,dep>tm5t ( ! ,air ,=ce has compli$4 7#f7 ,section #ceae ( title #ca1 ,unit$ ,/ates ,code1 requires ! ag5cies ( ! ,f$]al ,gov]nm5t1 includ+ ! ,dep>tm5t ( ,def5se1 to pres5t auditable f9ancial /atem5ts beg9n+ n lat] ?an ,m>* #a1 #aiig4 ,! ,dep>tm5t has n compli$ ) ?is law4 7#g7 ,! ,f$]al ,f9ancial ,managem5t ,improvem5t ,act ( #aiif 7#ca ,u4,s4,c4 #ceab note7 requires f9ancial sy/ems acquir$ by ! ,f$]al ,gov]nm5t1 includ+ ! ,dep>tm5t ( ,def5se1 to be able to provide in=mation to lead]s to manage & control ! co/ ( gov]nm5t4 ,! ,dep>tm5t has n compli$ ) ?is law4 7#h7 ,! ,national ,def5se ,au?orization ,act = ,fiscal ,ye> #bjjb 7,public ,law #ajg-ajg7 requires ! ,secret>y ( ,def5se to report to ,congress annually on ! reliability ( ! f9ancial /atem5ts ( ! ,dep>tm5t ( ,def5se1 to m9imize res\rces sp5t on produc+ unreliable f9ancial /atem5ts1 & to use res\rces sav$ to improve f9ancial managem5t policies1 proc$ures1 & int]nal controls4 7#i7 ,9 #bjje1 ! ,dep>tm5t ( ,def5se creat$ a ,f9ancial ,improvem5t & ,audit ,read9ess 7,,fi>7 ,plan1 ov]se5 by a directorate )9 ! (fice ( ! ,"u ,secret>y ( ,def5se 7,comptroll]71 to improve ,dep>tm5t bus9ess processes ) ! goal ( produc+ timely1 reliable1 & accurate f9ancial in=mation t c\ld g5]ate an audit-ready annual f9ancial /atem5t4 ,9 ,decemb] #bjje1 t directorate1 kn[n z ! ,,fi> ,directorate1 issu$ ! fir/ ( a s]ies ( semiannual reports on ! /atus ( ! ,f9ancial ,improvem5t & ,audit ,read9ess ,plan4 7#aj7 ,! ,national ,def5se ,au?orization ,act = ,fiscal ,ye> #bjaj 7,public ,law #aaa-hd7 requires regul> /atus reports on ! ,f9ancial ,improvem5t & ,audit ,read9ess ,plan describ$ 9 p>agraph 7#i71 & codifi$ z a /atutory requirem5t ! goal ( ! ,plan 9 ensur+ t ,dep>tm5t ( ,def5se f9ancial /atem5ts are validat$ z ready = audit n lat] ?an ,septemb] #cj1 #bjag4 #ffc4 ,sp5d+ r$uctions = ag5cies )\t clean audits 7a7 ,applicability 7#a7 ,9 g5]al ,subject to p>agraph 7#b71 ?is section applies to ea* ,f$]al ag5cy id5tifi$ by ! ,director ( ! ,(fice ( ,managem5t & ,budget z requir$ to h an audit$ f9ancial /atem5t "u section #ceae ( title #ca1 ,unit$ ,/ates ,code4 7#b7 ,applicability to milit>y dep>tm5ts & def5se ag5cies ,= purposes ( p>agraph 7#a71 9 ! case ( ! ,dep>tm5t ( ,def5se1 ea* milit>y dep>tm5t & ea* ,def5se ,ag5cy %all be treat$ z a sep>ate ,f$]al ag5cy4 7b7 ,def9itions ,9 ?is section1 ! t]ms f9ancial /atem5t & ext]nal indep5d5t auditor h ! mean+s giv5 ^? t]ms 9 section #ceba7;e7 ( title #ca1 ,unit$ ,/ates ,code4 7c7 ,adju/m5ts = f9ancial acc\ntability 7#a7 ,r$uction requir$ ,if a ,f$]al ag5cy has n submitt$ a f9ancial /atem5t = a fiscal ye> by ,m>* #a ( ! next fiscal ye>1 or if su* f9ancial /atem5t has n receiv$ ei!r an unqualifi$ or a qualifi$ audit op9ion by an indep5d5t ext]nal auditor by su* date1 ! discretion>y budget au?ority available = ! ,f$]al ag5cy = ! !n curr5t fiscal ye> is r$uc$ by #e p]c5t1 ) ! r$uction appli$ proportionately to ea* acc\nt 7o!r ?an an acc\nt li/$ 9 subsection 7d7 or an acc\nt = :i* a waiv] is made "u subsection 7e774 7#b7 ,treatm5t ( r$uction ,an am\nt equal to ! total am\nt ( any r$uction made "u p>agraph 7#b7 %all be reta9$ 9 ! g5]al fund ( ! ,treasury = ! purposes ( deficit r$uction4 7d7 ,acc\nts exclud$ ,! foll[+ acc\nts are exclud$ f any r$uctions ref]r$ to 9 subsection 7c77#a73 7#a7 ,milit>y p]sonnel1 res]ve p]sonnel1 & ,national ,gu>d p]sonnel acc\nts ( ! ,dep>tm5t ( ,def5se4 7#b7 ,! ,def5se ,heal? ,program acc\nt ( ! ,dep>tm5t ( ,def5se4 7e7 ,waiv] ,! ,presid5t may waive subsection 7c77#a7 ) respect to an acc\nt if ! ,presid5t c]tifies t apply+ ! subsection to t acc\nt w\ld h>m national security or memb]s ( ! ,arm$ ,=ces :o are s]v+ 9 a combat zone4 7f7 ,report ,n lat] ?an #fj days aft] an adju/m5t is made "u subsection 7c71 ! ,director ( ! ,(fice ( ,managem5t & ,budget %all submit to ,congress a report describ+ ! am\nt ( ! adju/m5t & ! affect$ acc\nts4 #ffd4 ,report on ,dep>tm5t ( ,def5se report+ requirem5ts ,n lat] ?an #ahj days aft] ! date ( ! enactm5t ( ?is ,act1 ! ,"u ,secret>y ( ,def5se 7,comptroll]7 %all submit to ,congress a report sett+ =? ! foll[+3 7#a7 ,a li/ ( ea* report ( ! ,dep>tm5t ( ,def5se requir$ by law to be submitt$ to ,congress :i*1 9 ! op9ion ( ! ,"u ,secret>y1 w\ld no long] be necess>y if ! f9ancial /atem5ts ( ! ,dep>tm5t ( ,def5se 7 audit$ ) an unqualifi$ op9ion4 7#b7 ,a li/ ( ea* report ( ! ,dep>tm5t requir$ by law to be submitt$ to ,congress :i*1 9 ! op9ion ( ! ,"u ,secret>y1 int]f]es ) ! capacity ( ! ,dep>tm5t to a*ieve an audit ( ! f9ancial /atem5ts ( ! ,dep>tm5t ) an unqualifi$ op9ion4 #ffe4 ,s5se ( ,congress 9 implem5tation ( def5se budget r$uctions ,x is ! s5se ( ,congress t-- 7#a7 z ! ov]all def5se budget is cut1 congressional def5se committees & ! ,dep>tm5t ( ,def5se %\ld n endang] memb]s ( ! ,arm$ ,=ces by r$uc+ w\nd$ w>rior acc\nts or vital protection 7su* z body armor7 = memb]s ( ! ,arm$ ,=ces 9 h>m's way2 7#b7 ! valuation ( legacy assets by ! ,dep>tm5t ( ,def5se %\ld be simplifi$ )\t compromis+ ess5tial controls or g5]ally accept$ gov]nm5t audit+ /&>ds2 & 7#c7 no?+ 9 ?is subtitle %\ld be con/ru$ to require or p]mit ! declassification ( acc\nt+ details ab\t classifi$ def5se programs1 &1 z requir$ by law1 ! ,dep>tm5t ( ,def5se %\ld ensure f9ancial acc\ntability 9 su* programs us+ prov5 practices1 includ+ us+ auditors ) security cle>ances4 ,,vii ,inve/ 9 ,job ,creation ,a ,mak+ ,"w ,pay ,ext5sion #gja4 ,"o-ye> ext5sion ( mak+ "w pay cr$it 7a7 ,9 g5]al ,subsection 7e7 ( section #cf;,a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ to read z foll[s3 7e7 ,t]m9ation ,?is section %all n apply to taxable ye>s-- 7#a7 beg9n+ aft] ,decemb] #ca1 #bjaj1 & be=e ,janu>y #a1 #bjac1 or 7#b7 beg9n+ aft] ,decemb] #ca1 #bjac4 4 7b7 ,treatm5t ( possessions ,p>agraph 7#a7 ( section #ajja7;b7 ( ! ,am]ican ,recov]y & ,re9ve/m5t ,tax ,act ( #bjji is am5d$ by /rik+ #bjji & #bjaj bo? places x appe>s & ins]t+ #bjji1 #bjaj1 & #bjac4 7c7 ,effective date ,! am5dm5t made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjab4 ,b ,support = ,tea*]s & ,s*ool ,mod]nization ,i ,prev5t+ tea*] lay(fs & support+ ! creation ( additional jobs 9 public e>ly *ildhood1 elem5t>y1 & second>y education #gaa4 ,purpose ,! purpose ( ?is "p is to provide funds to ,/ates to prev5t tea*] lay(fs & support ! creation ( additional jobs 9 public e>ly *ildhood1 elem5t>y1 & second>y education 9 ! #bjab-bjac & #bjac-bjad s*ool ye>s4 #gab4 ,grants = ! outly+ areas & ! ,secret>y ( ! ,int]ior2 availability ( funds 7a7 ,res]vation ( funds ,f ! am\nt appropriat$ to c>ry out ?is subtitle "u section #gba1 ! ,secret>y-- 7#a7 %all res]ve up to "o-half ( "o p]c5t to provide assi/ance to ! outly+ areas on ! basis ( _! respective ne$s1 z det]m9$ by ! ,secret>y1 = activities consi/5t ) ?is "p "u su* t]ms & conditions z ! ,secret>y may det]m9e2 7#b7 %all res]ve up to "o-half ( "o p]c5t to provide assi/ance to ! ,secret>y ( ! ,int]ior to c>ry out activities consi/5t ) ?is "p1 9 s*ools op]at$ or fund$ by ! ,bureau ( ,indian ,education2 & 7#c7 may res]ve up to #b1jjj1jjj = adm9i/ration & ov]sight ( ?is subtitle1 includ+ program evaluation4 7b7 ,availability ( funds ,funds made available "u section #gba %all rema9 available to ! ,secret>y until ,septemb] #cj1 #bjad4 #gac4 ,/ate allocation 7a7 ,allocation ,aft] res]v+ funds "u section section #gab7;a71 ! ,secret>y %all allocate ! rema9+ funds appropriat$ "u section #gba to ,/ates1 ( :i*-- 7#a7 #fj p]c5t %all be allocat$ to ,/ates on ! basis ( _! relative population ( individuals ag$ #e ?r\gh #ag2 & 7#b7 #dj p]c5t %all be allocat$ to ,/ates on ! basis ( _! relative total population4 7b7 ,aw>ds ,! ,secret>y %all aw>d a ,/ate's allocation "u subsection 7a7 to ! ,gov]nor ( ! ,/ate only if ! ,secret>y has approv$ ! ,/ate's application "u section #gad4 7c7 ,alt]nate di/ribution ( funds 7#a7 ,9 g5]al ,if1 )9 #cj days aft] ! date ( enactm5t ( ?is ,act1 a ,gov]nor has n submitt$ an approvable application to ! ,secret>y1 ! ,secret>y %all1 consi/5t ) p>agraph 7#b71 provide = funds allocat$ to t ,/ate to be di/ribut$ to ano!r entity or o!r entities 9 ! ,/ate = ! support ( e>ly *ildhood1 elem5t>y1 & second>y education1 "u su* t]ms & conditions z ! ,secret>y may e/abli%4 7#b7 ,ma9t5ance ( ef=t 7,a7 ,gov]nor assurance ,! ,secret>y %all n allocate funds "u p>agraph 7#a7 unless ! ,gov]nor ( ! ,/ate provides an assurance to ! ,secret>y t ! ,/ate w = fiscal ye>s #bjac & #bjad meet ! requirem5ts ( section #gah4 7,b7 ,allocations to o!r entities ,not)/&+ subp>agraph 7,a71 ! ,secret>y may allocate up to #ej p]c5t ( ! funds t are available to ! ,/ate "u p>agraph 7#a7 to ano!r entity or entities 9 ! ,/ate1 provid$ t ! ,/ate educational ag5cy submits data to ! ,secret>y demon/rat+ t ! ,/ate w = fiscal ye> #bjac meet ! requirem5ts ( section #gah7;a7 or ! ,secret>y o!rwise det]m9es t ! ,/ate w meet ^? requirem5ts1 or su* comp>able requirem5ts z ! ,secret>y may e/abli%1 = t ye>4 7#c7 ,requirem5ts ,an entity t receives funds "u p>agraph 7#a7 %all use ^? funds 9 accordance ) ! requirem5ts ( ?is subtitle4 7d7 ,reallocation ,if a ,/ate does n receive fund+ "u ?is "p or only receives a portion ( its allocation "u subsection 7c71 ! ,secret>y %all reallocate ! ,/ate's entire allocation or ! rema9+ portion ( its allocation1 z ! case may be1 to ! rema9+ ,/ates 9 accordance ) subsection 7a74 #gad4 ,/ate application ,! ,gov]nor ( a ,/ate desir+ to receive a grant "u ?is subtitle %all submit an application to ! ,secret>y )9 #cj days ( ! date ( enactm5t ( ?is ,act1 9 su* mann]1 & conta9+ su* in=mation z ! ,secret>y may reasonably require to det]m9e ! ,/ate's compliance ) applicable provisions ( law4 #gae4 ,/ate res]vation & responsibilities 7a7 ,res]vation ,ea* ,/ate receiv+ a grant "u section #gac7;b7 may res]ve-- 7#a7 n m ?an #aj p]c5t ( ! grant funds = aw>ds to ,/ate-fund$ e>ly le>n+ programs2 & 7#b7 n m ?an #b p]c5t ( ! grant funds = ! adm9i/rative co/s ( c>ry+ out its responsibilities "u ?is subtitle4 7b7 ,/ate responsibilities ,ea* ,/ate receiv+ a grant "u ?is "p %all1 aft] res]v+ any funds "u subsection 7a7-- 7#a7 use ! rema9+ grant funds only = aw>ds to local educational ag5cies = ! support ( e>ly *ildhood1 elem5t>y1 & second>y education2 & 7#b7 di/ribute ^? funds1 ?r\gh subgrants1 to its local educational ag5cies by di/ribut+-- 7,a7 #fj p]c5t on ! basis ( ! local educational ag5cies' relative %>es ( enrollm5t2 & 7,b7 #dj p]c5t on ! basis ( ! local educational ag5cies' relative %>es ( funds receiv$ "u "p ,a ( title ,i ( ! ,elem5t>y & ,second>y ,education ,act ( #aife = fiscal ye> #bjab2 & 7#c7 make ^? funds available to local educational ag5cies no lat] ?an #ajj days aft] receiv+ a grant f ! ,secret>y4 7c7 ,prohibitions ,a ,/ate %all n use funds receiv$ "u ?is subtitle to directly or indirectly-- 7#a7 e/abli%1 re/ore1 or supplem5t a ra9y-day fund2 7#b7 supplant ,/ate funds 9 a mann] t has ! effect ( e/abli%+1 re/or+1 or supplem5t+ a ra9y-day fund2 7#c7 r$uce or retire debt obligations incurr$ by ! ,/ate2 or 7#d7 supplant ,/ate funds 9 a mann] t has ! effect ( r$uc+ or retir+ debt obligations incurr$ by ! ,/ate4 #gaf4 ,local educational ag5cies ,ea* local educational ag5cy t receives a subgrant "u ?is "p-- 7#a7 %all use ! subgrant funds only = comp5sation & b5efits & o!r exp5ses1 su* z support s]vices1 necess>y to reta9 exi/+ employees1 recall or rehire =m] employees1 or hire new employees to provide e>ly *ildhood1 elem5t>y1 or second>y educational & relat$ s]vices2 7#b7 %all obligate ^? funds n lat] ?an ,septemb] #cj1 #bjad2 & 7#c7 may n use ^? funds = g5]al adm9i/rative exp5ses or = o!r support s]vices or exp5ditures1 z ^? t]ms are def9$ by ! ,national ,c5t] = ,education ,/ati/ics 9 ! ,common ,core ( ,data1 z ( ! date ( enactm5t ( ?is ,act4 #gag4 ,e>ly le>n+ ,ea* ,/ate-fund$ e>ly le>n+ program t receives funds "u ?is subtitle %all-- 7#a7 use ^? funds only = comp5sation1 b5efits1 & o!r exp5ses1 su* z support s]vices1 necess>y to reta9 e>ly *ildhood educators1 recall or rehire =m] e>ly *ildhood educators1 or hire new e>ly *ildhood educators to provide e>ly le>n+ s]vices2 & 7#b7 obligate ^? funds n lat] ?an ,septemb] #cj1 #bjad4 #gah4 ,ma9t5ance ( ef=t 7a7 ,requirem5t ,! ,secret>y %all n allocate funds to a ,/ate "u ?is subtitle unless ! ,/ate provides an assurance to ! ,secret>y t-- 7#a7 = ,/ate fiscal ye> #bjac-- 7,a7 ! ,/ate w ma9ta9 ,/ate support = e>ly *ildhood1 elem5t>y1 & second>y education 79 ! aggregate or on ! basis ( exp5diture p] pupil7 & = public in/itutions ( high] education 7n includ+ support = capital projects or = rese>* & developm5t or tuition & fees paid by /ud5ts7 at n less ?an ! level ( su* support = ea* ( ! two categories = ,/ate fiscal ye> #bjab2 or 7,b7 ! ,/ate w ma9ta9 ,/ate support = e>ly *ildhood1 elem5t>y1 & second>y education & = public in/itutions ( high] education 7n includ+ support = capital projects or = rese>* & developm5t or tuition & fees paid by /ud5ts7 at a p]c5tage ( ! total rev5ues available to ! ,/ate t is equal to or great] ?an ! p]c5tage provid$ = ,/ate fiscal ye> #bjab2 & 7#b7 = ,/ate fiscal ye> #bjad-- 7,a7 ! ,/ate w ma9ta9 ,/ate support = e>ly *ildhood1 elem5t>y1 & second>y education 79 ! aggregate or on ! basis ( exp5diture p] pupil7 & = public in/itutions ( high] education 7n includ+ support = capital projects or = rese>* & developm5t or tuition & fees paid by /ud5ts7 at n less ?an ! level ( su* support = ea* ( ! two categories = ,/ate fiscal ye> #bjac2 or 7,b7 ! ,/ate w ma9ta9 ,/ate support = e>ly *ildhood1 elem5t>y1 & second>y education & = public in/itutions ( high] education 7n includ+ support = capital projects or = rese>* & developm5t or tuition & fees paid by /ud5ts7 at a p]c5tage ( ! total rev5ues available to ! ,/ate t is equal to or great] ?an ! p]c5tage provid$ = ,/ate fiscal ye> #bjac4 7b7 ,waiv] ,! ,secret>y may waive ! requirem5ts ( ?is section if ! ,secret>y det]m9es t a waiv] w\ld be equitable due to-- 7#a7 exceptional or uncontrollable circum/ances1 su* z a natural disa/]2 or 7#b7 a precipit\s decl9e 9 ! f9ancial res\rces ( ! ,/ate4 #gai4 ,report+ ,ea* ,/ate t receives a grant "u ?is "p %all submit1 on an annual basis1 a report to ! ,secret>y t conta9s-- 7#a7 a description ( h[ funds receiv$ "u ?is "p 7 exp5d$ or obligat$2 & 7#b7 an e/imate ( ! numb] ( jobs support$ by ! ,/ate us+ funds receiv$ "u ?is subtitle4 #gbj4 ,def9itions ,9 ?is "p3 7#a7 ,,esea def9itions ,except z o!rwise provid$1 ! t]ms local educational ag5cy1 outly+ area1 ,secret>y1 ,/ate1 & ,/ate educational ag5cy h ! mean+s giv5 ^? t]ms 9 section #iaja ( ! ,elem5t>y & ,second>y ,education ,act ( #aife 7#bj ,u4,s4,c4 #ghja74 7#b7 ,/ate ,! t]m ,/ate does n include an outly+ area4 7#c7 ,e>ly *ild educator ,! t]m e>ly *ildhood educator means an individual :o-- 7,a7 works directly ) *ildr5 9 a ,/ate-fund$ e>ly le>n+ program 9 a l[-income community2 7,b7 is involv$ directly 9 ! c>e1 developm5t1 & education ( infants1 toddl]s1 or "y *ildr5 age five & "u2 & 7,c7 has complet$ a baccalaureate or advanc$ degree 9 e>ly *ildhood developm5t or e>ly *ildhood education1 or 9 a field relat$ to e>ly *ildhood education4 7#d7 ,/ate-fund$ e>ly le>n+ program ,! t]m ,/ate-fund$ e>ly le>n+ program means a program t provides educational s]vices to *ildr5 f bir? to k9d]g>t5 entry & receives fund+ f a ,/ate4 #gba4 ,au?orization ( appropriations ,!re are au?oriz$ to be appropriat$1 & !re are appropriat$1 #cj1jjj1jjj1jjj to c>ry out ?is "p = fiscal ye> #bjac4 ,,ii ,elem5t>y & second>y s*ools #gca4 ,purpose ,! purpose ( ?is "p is to provide assi/ance = ! mod]nization1 r5ovation1 & repair ( elem5t>y & second>y s*ool build+s 9 public s*ool di/ricts across ,am]ica 9 ord] to support ! a*ievem5t ( improv$ educational outcomes 9 ^? s*ools4 #gcb4 ,au?orization ( appropriations ,!re are au?oriz$ to be appropriat$1 & !re are appropriat$1 #be1jjj1jjj1jjj to c>ry out ?is "p1 :i* %all be available = obligation by ! ,secret>y until ,septemb] #cj1 #bjad4 #gcc4 ,allocation ( funds 7a7 ,res]vations ,( ! am\nt made available to c>ry out ?is "p1 ! ,secret>y %all res]ve-- 7#a7 "o-half ( "o p]c5t = ! ,secret>y ( ! ,int]ior to c>ry out mod]nization1 r5ovation1 & repair activities describ$ 9 section #gcf 9 s*ools op]at$ or fund$ by ! ,bureau ( ,indian ,education2 7#b7 "o-half ( "o p]c5t to make grants to ! outly+ areas = mod]nization1 r5ovation1 & repair activities describ$ 9 section #gcf2 & 7#c7 su* funds z ! ,secret>y det]m9es are ne$$ to conduct a survey1 by ! ,national ,c5t] = ,education ,/ati/ics1 ( ! s*ool con/ruction1 mod]nization1 r5ovation1 & repair ne$s ( ! public s*ools ( ! ,unit$ ,/ates4 7b7 ,/ate allocation ,aft] res]v+ funds "u subsection 7a71 ! ,secret>y %all allocate ! rema9+ am\nt among ! ,/ates 9 proportion to _! respective allocations "u "p ,a ( title ,i ( ! ,elem5t>y & ,second>y ,education ,act ( #aife 79 ?is "p ref]r$ to z ! ,,esea7 7#bj ,u4,s4,c4 #fcaa et seq47 = fiscal ye> #bjac1 except t-- 7#a7 ! ,secret>y %all allocate #dj p]c5t ( su* rema9+ am\nt to ! #ajj local educational ag5cies ) ! l>ge/ numb]s ( *ildr5 ag$ #e-ag liv+ 9 pov]ty1 z det]m9$ us+ ! mo/ rec5t data available f ! ,dep>tm5t ( ,comm]ce t are satisfactory to ! ,secret>y1 9 proportion to ^? ag5cies' respective allocations "u "p ,a ( title ,i ( ! ,,esea = fiscal ye> #bjac2 & 7#b7 ! allocation to any ,/ate %all be r$uc$ by ! aggregate am\nt ( ! allocations "u p>agraph 7#a7 to local educational ag5cies 9 t ,/ate4 7c7 ,rema9+ allocation 7#a7 ,/ates ,if a ,/ate does n apply = its allocation "u subsection 7b7 7or applies = less ?an ! full allocation = :i* x is eligible7 or does n use t allocation 9 a timely mann]1 ! ,secret>y may-- 7,a7 reallocate all or a portion ( t allocation to ! o!r ,/ates 9 accordance ) subsection 7b72 or 7,b7 use all or a portion ( t allocation to make direct allocations to local educational ag5cies )9 ! ,/ate bas$ on _! respective allocations "u "p ,a ( title ,i ( ! ,,esea = fiscal ye> #bjac or su* o!r me?od z ! ,secret>y may det]m9e4 7#b7 ,local educational ag5cies ,if a local educational ag5cy does n apply = its allocation "u subsection 7b77#a71 applies = less ?an ! full allocation = :i* x is eligible1 or does n use t allocation 9 a timely mann]1 ! ,secret>y may reallocate all or a portion ( its allocation to ! ,/ate 9 :i* t ag5cy is locat$4 #gcd4 ,/ate use ( funds 7a7 ,res]vation ,ea* ,/ate t receives a grant "u ?is "p may res]ve n m ?an "o p]c5t ( ! ,/ate's allocation "u section #gcc7;b7 = ! purpose ( adm9i/]+ ! grant1 except t no ,/ate may res]ve m ?an #gej1jjj = ?is purpose4 7b7 ,funds to local educational ag5cies 7#a7 ,=mula subgrants ,f ! grant funds t are n res]v$ "u subsection 7a71 a ,/ate %all allocate at lea/ #ej p]c5t to local educational ag5cies1 includ+ *>t] s*ools t are local educational ag5cies1 t did n receive funds "u section #gcc7;b77#a7 f ! ,secret>y1 9 accordance ) _! respective allocations "u "p ,a ( title ,i ( ! ,,esea = fiscal ye> #bjac1 except t no su* local educational ag5cy %all receive less ?an #aj1jjj4 7#b7 ,additional subgrants ,! ,/ate %all use any funds rema9+1 aft] res]v+ funds "u subsection 7a7 & allocat+ funds "u p>agraph 7#a71 = subgrants to local educational ag5cies t did n receive funds "u section #gcc7;b77#a71 includ+ *>t] s*ools t are local educational ag5cies1 to support mod]nization1 r5ovation1 & repair projects t ! ,/ate det]m9es1 us+ objective crit]ia1 are mo/ ne$$ 9 ! ,/ate1 ) priority giv5 to projects 9 rural local educational ag5cies4 7c7 ,rema9+ funds ,if a local educational ag5cy does n apply = an allocation "u subsection 7b77#a71 applies = less ?an its full allocation1 or fails to use t allocation 9 a timely mann]1 ! ,/ate may reallocate any unus$ portion to o!r local educational ag5cies 9 accordance ) subsection 7b74 #gce4 ,/ate & local applications 7a7 ,/ate application ,a ,/ate t desires to receive a grant "u ?is "p %all submit an application to ! ,secret>y at su* "t1 9 su* mann]1 & conta9+ su* in=mation & assurances z ! ,secret>y may require1 :i* %all include-- 7#a7 an id5tification ( ! ,/ate ag5cy or entity t w adm9i/] ! program "u ?is "p2 & 7#b7 ! ,/ate's process = det]m9+ h[ ! grant funds w be di/ribut$ & adm9i/]$1 includ+-- 7,a7 h[ ! ,/ate w det]m9e ! crit]ia & priorities 9 mak+ subgrants "u section #gcd7;b77#b72 7,b7 any additional crit]ia ! ,/ate w use 9 det]m9+ :i* projects x w fund "u t section2 7,c7 a description ( h[ ! ,/ate w consid]-- 7i7 ! ne$s ( local educational ag5cies = assi/ance "u ?is "p2 7ii7 ! impact ( pot5tial projects on job creation 9 ! ,/ate2 7iii7 ! fiscal capacity ( local educational ag5cies apply+ = assi/ance2 7iv7 ! p]c5tage ( *ildr5 9 ^? local educational ag5cies :o are f l[-income families2 & 7v7 ! pot5tial = lev]ag+ assi/ance provid$ by ! program "u ?is "p ?r\gh mat*+ or o!r f9anc+ me*anisms2 7,d7 a description ( h[ ! ,/ate w ensure t ! local educational ag5cies receiv+ subgrants meet ! requirem5ts ( ?is "p2 7,e7 a description ( h[ ! ,/ate w ensure t ! ,/ate & its local educational ag5cies meet ! deadl9es e/abli%$ 9 section #gch2 7,f7 a description ( h[ ! ,/ate w give priority to ! use ( gre5 practices t are c]tifi$1 v]ifi$1 or consi/5t ) any applicable provisions (-- 7i7 ! ,,le$ ,gre5 ,build+ ,rat+ ,sy/em2 7ii7 ,en]gy ,/>2 7iii7 ! ,,*ps ,crit]ia2 7iv7 ,gre5 ,globes2 or 7v7 an equival5t program adopt$ by ! ,/ate or ano!r jurisdiction ) au?ority ov] ! local educational ag5cy2 7,g7 a description ( ! /eps t ! ,/ate w take to ensure t local educational ag5cies receiv+ subgrants "u ?is "p w adequately ma9ta9 any facilities t are mod]niz$1 r5ovat$1 or repair$ ) su* subgrant funds2 & 7,h7 su* additional in=mation & assurances z ! ,secret>y may require4 7b7 ,local application ,a local educational ag5cy t is eligible "u section #gcc7;b77#a7 t desires to receive a grant "u ?is "p %all submit an application to ! ,secret>y at su* "t1 9 su* mann]1 & conta9+ su* in=mation & assurances z ! ,secret>y may require1 :i* %all include-- 7#a7 a description ( h[ ! local educational ag5cy w meet ! deadl9es & requirem5ts ( ?is "p2 7#b7 a description ( ! /eps t ! local educational ag5cy w take to adequately ma9ta9 any facilities t are mod]niz$1 r5ovat$1 or repair$ ) funds "u ?is "p2 & 7#c7 su* additional in=mation & assurances z ! ,secret>y may require4 #gcf4 ,use ( funds 7a7 ,9 g5]al ,funds aw>d$ to local educational ag5cies "u ?is "p %all be us$ only = ei!r or bo? ( ! foll[+ mod]nization1 r5ovation1 or repair activities 9 facilities t are us$ = elem5t>y or second>y education or = e>ly le>n+ programs3 7#a7 ,direct paym5ts = s*ool mod]nization1 r5ovation1 or repair4 7#b7 ,to pay int]e/ on bonds or paym5ts = o!r f9anc+ in/rum5ts t are newly issu$ = ! purpose ( f9anc+ s*ool mod]nization1 r5ovation1 or repair4 7b7 ,supplem5t1 n supplant ,funds made available "u ?is "p %all be us$ to supplem5t1 & n supplant1 o!r ,f$]al1 ,/ate1 & local funds t w\ld o!rwise be exp5d$ to mod]nize1 r5ovate1 or repair eligible s*ool facilities4 7c7 ,prohibition ,funds aw>d$ to local educational ag5cies "u ?is "p may n be us$ =-- 7#a7 new con/ruction2 7#b7 paym5t ( r\t9e ma9t5ance co/s2 or 7#c7 mod]nization1 r5ovation1 or repair ( /adiums or o!r facilities prim>ily us$ = a?letic conte/s or exhibitions or o!r ev5ts = :i* admission is *>g$ to ! g5]al public4 #gcg4 ,private s*ools 7a7 ,9 g5]al ,section #ieja ( ! ,,esea 7#bj ,u4,s4,c4 #ghha7 %all apply to ?is "p 9 ! same mann] z x applies to activities "u t ,act1 except t-- 7#a7 su* section #ieja %all n apply ) respect to ! title to any real prop]ty mod]niz$1 r5ovat$1 or repair$ ) assi/ance provid$ "u ?is "p2 7#b7 educational s]vices or o!r b5efits fund$ "u ?is "p = private s*ools %all be provid$ only to private1 nonpr(it elem5t>y or second>y s*ools ) a rate ( *ild pov]ty ( at lea/ #dj p]c5t & may include only-- 7,a7 modifications ( s*ool facilities necess>y to meet ! /&>ds applicable to public s*ools "u ! ,am]icans ) ,disabilities ,act ( #aiij 7#db ,u4,s4,c4 #abaja et seq472 7,b7 modifications ( s*ool facilities necess>y to meet ! /&>ds applicable to public s*ools "u section #ejd ( ! ,rehabilitation ,act ( #aigc 7#bi ,u4,s4,c4 #gid72 & 7,c7 asbe/os or poly*lor9at$ biph5yls abatem5t or removal f s*ool facilities2 & 7#c7 exp5ditures = s]vices provid$ us+ funds made available "u section #gcf %all be consid]$ equal = purposes ( section #ieja7;a77#d7 ( ! ,,esea if ! p]-pupil exp5ditures = s]vices describ$ 9 p>agraph 7#b7 = /ud5ts enroll$ 9 private1 nonpr(it elem5t>y & second>y s*ools t h *ild-pov]ty rates ( at lea/ #dj p]c5t are consi/5t ) ! p]-pupil exp5ditures "u ?is "p = *ildr5 enroll$ 9 ! public s*ools ( ! local educational ag5cy receiv+ funds "u ?is "p4 7b7 ,rema9+ funds ,if ! exp5diture = s]vices describ$ 9 subsection 7a77#b7 is less ?an ! am\nt calculat$ "u subsection 7a77#c7 because ( insuffici5t ne$ = ^? s]vices1 ! rema9d] %all be available to ! local educational ag5cy = mod]nization1 r5ovation1 or repair ( its s*ool facilities4 7c7 ,application ,if any provision ( ?is section1 or ! application !re(1 to any p]son or circum/ance is judicially det]m9$ to be invalid1 ! rema9d] ( ! section & ! application to o!r p]sons or circum/ances %all n be affect$ !reby4 #gch4 ,additional provisions 7a7 #bd-,mon? p]iod ( availability ,funds appropriat$ "u section #gcb %all be available = obligation by local educational ag5cies receiv+ grants f ! ,secret>y "u section #gcc7;b77#a71 by ,/ates res]v+ funds "u section #gcd7;a71 & by local educational ag5cies receiv+ subgrants "u section #gcd7;b77#a7 only dur+ ! p]iod t ends #bd mon?s aft] ! date ( enactm5t ( ?is ,act4 7b7 #cf-,mon? p]iod ( availability ,funds appropriat$ "u section #gcb %all be available = obligation by local educational ag5cies receiv+ subgrants "u section #gcd7;b77#b7 only dur+ ! p]iod t ends #cf mon?s aft] ! date ( enactm5t ( ?is ,act4 7c7 ,applicability ( ,,gepa ,section #dci ( ! ,g5]al ,education ,provisions ,act 7#bj ,u4,s4,c4 #abcb;b7 %all apply to funds available "u ?is "p4 7d7 ,limitation ,= purposes ( section #gcc7;b77#a71 ,hawaii1 ! ,di/rict ( ,columbia1 & ! ,commonweal? ( ,pu]to ,rico are n local educational ag5cies4 ,,iii ,community ,college mod]nization #gci4 ,f$]al assi/ance = community college mod]nization 7a7 ,9 g5]al 7#a7 ,grant program ,f ! am\nts made available "u subsection 7h71 ! ,secret>y %all aw>d grants to ,/ates to mod]nize1 r5ovate1 or repair exi/+ facilities at community colleges4 7#b7 ,allocation 7,a7 ,res]vations ,( ! am\nt made available to c>ry out ?is section1 ! ,secret>y %all res]ve-- 7i7 up to #j4be p]c5t = grants to in/itutions t are eligible "u section #caf ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajei;c7 to provide = mod]nization1 r5ovation1 & repair activities describ$ 9 ?is section2 & 7ii7 up to #j4be p]c5t = grants to ! outly+ areas to provide = mod]nization1 r5ovation1 & repair activities describ$ 9 ?is section4 7,b7 ,allocation ,aft] res]v+ funds "u subp>agraph 7,a71 ! ,secret>y %all allocate to ea* ,/ate t has an application approv$ by ! ,secret>y an am\nt t be>s ! same relation to any rema9+ funds z ! total numb] ( /ud5ts 9 su* ,/ate :o are enroll$ 9 in/itutions describ$ 9 section #gdj7;b77#a77;,a7 plus ! numb] ( /ud5ts :o are e/imat$ to be enroll$ 9 & pursu+ a degree or c]tificate t is n a ba*elor's1 ma/]'s1 pr(essional1 or o!r advanc$ degree 9 in/itutions describ$ 9 section #gdj7;b77#a77;,b71 bas$ on ! proportion ( degrees or c]tificates aw>d$ by su* in/itutions t are n ba*elor's1 ma/]'s1 pr(essional1 or o!r advanc$ degrees1 z report$ to ! ,integrat$ ,po/second>y ,data ,sy/em be>s to ! e/imat$ total numb] ( su* /ud5ts 9 all ,/ates1 except t no ,/ate %all receive less ?an #b1ejj1jjj4 7,c7 ,reallocation ,am\nts n allocat$ "u ?is section to a ,/ate because ! ,/ate ei!r did n submit an application "u subsection 7b71 ! ,/ate submitt$ an application t ! ,secret>y det]m9$ did n meet ! requirem5ts ( su* subsection1 or ! ,/ate _c demon/rate to ! ,secret>y a suffici5t dem& = projects to w>rant ! full allocation ( ! funds1 %all be proportionately reallocat$ "u ?is p>agraph to ! o!r ,/ates t h a demon/rat$ ne$ =1 & are receiv+1 allocations "u ?is section4 7,d7 ,/ate adm9i/ration ,a ,/ate t receives a grant "u ?is section may use n m ?an "o p]c5t ( t grant to adm9i/] x1 except t no ,/ate may use m ?an #gej1jjj ( its grant = ?is purpose4 7#c7 ,supplem5t1 n supplant ,funds made available "u ?is section %all be us$ to supplem5t1 & n supplant1 o!r ,f$]al1 ,/ate1 & local funds t w\ld o!rwise be exp5d$ to mod]nize1 r5ovate1 or repair exi/+ community college facilities4 7b7 ,application ,a ,/ate t desires to receive a grant "u ?is section %all submit an application to ! ,secret>y at su* "t1 9 su* mann]1 & conta9+ su* in=mation & assurances z ! ,secret>y may require4 ,su* application %all include a description (-- 7#a7 h[ ! funds provid$ "u ?is section w improve in/ruction at community colleges 9 ! ,/ate & w improve ! ability ( ^? colleges to educate & tra9 /ud5ts to meet ! work=ce ne$s ( employ]s 9 ! ,/ate2 7#b7 ! project$ />t ( ea* project & ! e/imat$ numb] ( p]sons to be employ$ 9 ! project2 & 7#c7 ! co/ ( ea* project & ! total am\nt ( funds reque/$ = ea* project & = all projects4 7c7 ,prohibit$ uses ( funds 7#a7 ,9 g5]al ,no funds aw>d$ "u ?is section may be us$ =-- 7,a7 paym5t ( r\t9e ma9t5ance co/s2 7,b7 con/ruction1 mod]nization1 r5ovation1 or repair ( /adiums or o!r facilities prim>ily us$ = a?letic conte/s or exhibitions or o!r ev5ts = :i* admission is *>g$ to ! g5]al public2 or 7,c7 con/ruction1 mod]nization1 r5ovation1 or repair ( facilities-- 7i7 us$ = sect>ian in/ruction1 religi\s wor%ip1 or a s*ool or dep>tm5t ( div9ity2 or 7ii7 9 :i* a sub/antial portion ( ! functions ( ! facilities are subsum$ 9 a religi\s mission4 7#b7 ,f\r-ye> in/itutions ,no funds aw>d$ to a f\r-ye> public in/itution ( high] education "u ?is section may be us$ = any facility1 s]vice1 or program ( ! in/itution t is n available to /ud5ts :o are pursu+ a degree or c]tificate t is n a ba*elor's1 ma/]'s1 pr(essional1 or o!r advanc$ degree4 7d7 ,gre5 projects ,9 provid+ assi/ance to community college projects "u ?is section1 ! ,/ate %all consid] ! ext5t to :i* a community college's project involves activities t are c]tifi$1 v]ifi$1 or consi/5t ) ! applicable provisions (-- 7#a7 ! ,,le$ ,gre5 ,build+ ,rat+ ,sy/em2 7#b7 ,en]gy ,/>2 7#c7 ! ,,*ps ,crit]ia1 z applicable2 7#d7 ,gre5 ,globes2 or 7#e7 an equival5t program adopt$ by ! ,/ate or ! ,/ate high] education ag5cy t includes a v]ifiable me?od to demon/rate compliance ) su* program4 7e7 ,application ( ,,gepa ,section #dci ( ! ,g5]al ,education ,provisions ,act 7#bj ,u4,s4,c4 #abcb;b7 %all apply to funds available "u ?is section4 7f7 ,reports by ! /ates ,ea* ,/ate t receives a grant "u ?is section %all1 n lat] ?an ,septemb] #cj1 #bjac1 & annually !reaft] = ea* fiscal ye> 9 :i* ! ,/ate exp5ds funds receiv$ "u ?is section1 submit to ! ,secret>y a report t includes-- 7#a7 a description ( ! projects = :i* ! grant 01 or w be1 us$2 7#b7 a description ( ! am\nt & nature ( ! assi/ance provid$ to ea* community college "u ?is section2 & 7#c7 ! numb] ( jobs creat$ by ! projects fund$ "u ?is section4 7g7 ,report by ! secret>y ,! ,secret>y %all submit to ! au?oriz+ committees 7z def9$ 9 section #ajc ( ! ,high] ,education ,act ( #aife2 #bj ,u4,s4,c4 #ajjc7 an annual report on ! grants made "u ?is section1 includ+ ! in=mation describ$ 9 subsection 7f74 7h7 ,availability ( funds 7#a7 ,!re are au?oriz$ to be appropriat$1 & !re are appropriat$1 to c>ry out ?is section 79 addition to any o!r am\nts appropriat$ to c>ry out ?is section & out ( any money 9 ! ,treasury n o!rwise appropriat$71 #e1jjj1jjj1jjj = fiscal ye> #bjac4 7#b7 ,funds appropriat$ "u ?is subsection %all be available = obligation by community colleges only dur+ ! p]iod t ends #cf mon?s aft] ! date ( enactm5t ( ?is ,act4 ,,iv ,g5]al provisions #gdj4 ,def9itions 7a7 ,,esea t]ms ,except z o!rwise provid$1 9 ?is subtitle1 ! t]ms local educational ag5cy1 ,secret>y1 & ,/ate educational ag5cy h ! mean+s giv5 ^? t]ms 9 section #iaja ( ! ,elem5t>y & ,second>y ,education ,act ( #aife 7#bj ,u4,s4,c4 #ghja74 7b7 ,additional def9itions ,! foll[+ def9itions apply to ?is title3 7#a7 ,community college ,! t]m community college means-- 7,a7 a junior or community college1 z t t]m is def9$ 9 section #cab7;f7 ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajeh7;f772 or 7,b7 an in/itution ( high] education 7z def9$ 9 section #aja ( ! ,high] ,education ,act ( #aife 7#bj ,u4,s4,c4 #ajja77 t aw>ds a significant numb] ( degrees & c]tificates1 z det]m9$ by ! ,secret>y1 t are n-- 7i7 ba*elor's degrees 7or an equival5t72 or 7ii7 ma/]'s1 pr(essional1 or o!r advanc$ degrees4 7#b7 ,,*ps crit]ia ,! t]m ,,*ps ,crit]ia means ! gre5 build+ rat+ program develop$ by ! ,collaborative = ,high ,p]=mance ,s*ools4 7#c7 ,en]gy /> ,! t]m ,en]gy ,/> means ! ,en]gy ,/> program ( ! ,unit$ ,/ates ,dep>tm5t ( ,en]gy & ! ,unit$ ,/ates ,environm5tal ,protection ,ag5cy4 7#d7 ,gre5 globes ,! t]m ,gre5 ,globes means ! ,gre5 ,build+ ,initiative environm5tal design & rat+ sy/em ref]r$ to z ,gre5 ,globes4 7#e7 ,le$ gre5 build+ rat+ sy/em ,! t]m ,,le$ ,gre5 ,build+ ,rat+ ,sy/em means ! ,unit$ ,/ates ,gre5 ,build+ ,c\ncil ,lead]%ip 9 ,en]gy & ,environm5tal ,design gre5 build+ rat+ /&>d ref]r$ to z ! ,,le$ ,gre5 ,build+ ,rat+ ,sy/em4 7#f7 ,mod]nization1 r5ovation1 & repair ,! t]m mod]nization1 r5ovation1 & repair means-- 7,a7 compreh5sive assessm5ts ( facilities1 includ+ indoor air-quality assessm5ts1 to id5tify-- 7i7 facility conditions or defici5cies t c\ld adv]sely affect /ud5t & /aff heal?1 safety1 p]=mance1 or productivity or en]gy1 wat]1 or mat]ials effici5cy2 & 7ii7 ne$$ facility improvem5ts2 7,b7 repair+1 replac+1 or in/all+ ro(s 7:i* may be ext5sive1 int5sive1 or semi-int5sive gre5 ro(s72 electrical wir+2 wat] supply & plumb+ sy/ems1 sewage sy/ems1 /orm wat] run(f sy/ems1 light+ sy/ems 7or compon5ts ( su* sy/ems72 or build+ envelope1 w9d[s1 ceil+s1 floor+1 or doors1 includ+ security doors2 7,c7 repair+1 replac+1 or in/all+ heat+1 v5tilation1 or air condition+ sy/ems1 or compon5ts ( ^? sy/ems 7includ+ insulation7 to improve en]gy effici5cy2 7,d7 compliance ) fire1 heal?1 seismic1 & safety codes1 includ+ pr(essional in/allation ( fire & life safety al>ms1 & mod]nizations1 r5ovations1 & repairs t ensure t facilities are prep>$ = su* em]g5cies z acts ( t]rorism1 campus viol5ce1 & natural disa/]s1 su* z improv+ build+ infra/ructure to accommodate security measures & in/all+ or upgrad+ te*nology to ensure t a s*ool or incid5t is able to respond to su* em]g5cies2 7,e7 mak+ modifications necess>y to make educational facilities accessible 9 compliance ) ! ,am]icans ) ,disabilities ,act ( #aiij 7#db ,u4,s4,c4 #abaja et seq47 & section #ejd ( ! ,rehabilitation ,act ( #aigc 7#bi ,u4,s4,c4 #gid71 except t su* modifications %all n be ! prim>y use ( a grant or subgrant2 7,f7 abatem5t1 removal1 or int]im controls ( asbe/os1 poly*lor9at$ biph5yls1 mold1 mildew1 or lead-bas$ haz>ds1 includ+ lead-bas$ pa9t haz>ds2 7,g7 retr(itt+ necess>y to increase en]gy effici5cy2 7,h7 measures1 su* z selection & sub/itution ( products & mat]ials1 & implem5tation ( improv$ ma9t5ance & op]ational proc$ures1 su* z gre5 clean+ programs1 to r$uce or elim9ate pot5tial /ud5t or /aff exposure to-- 7i7 volatile organic comp\nds2 7ii7 p>ticles su* z du/ & poll5s2 or 7iii7 combu/ion gases2 7,i7 mod]nization1 r5ovation1 or repair necess>y to r$uce ! consumption ( coal1 electricity1 l&1 natural gas1 oil1 or wat]2 7,j7 in/allation or upgrad+ ( educational te*nology infra/ructure2 7,k7 in/allation or upgrad+ ( r5ewable en]gy g5]ation & heat+ sy/ems1 includ+ sol>1 photovoltaic1 w9d1 biomass 7includ+ wood pellet & woody biomass71 wa/e-to-en]gy1 sol>-!rmal1 & geo!rmal sy/ems1 & en]gy audits2 7,l7 mod]nization1 r5ovation1 or repair activities relat$ to en]gy effici5cy & r5ewable en]gy1 & improvem5ts to build+ infra/ructures to accommodate bicycle & p$e/rian access2 7,m7 gr\nd improvem5ts1 /orm wat] managem5t1 l&scap+1 & environm5tal clean-up :5 necess>y2 7,n7 o!r mod]nization1 r5ovation1 or repair to-- 7i7 improve tea*]s' ability to tea* & /ud5ts' ability to le>n2 7ii7 ensure ! heal? & safety ( /ud5ts & /aff2 or 7iii7 improve classroom1 laboratory1 & vocational facilities 9 ord] to enhance ! quality ( sci5ce1 te*nology1 eng9e]+1 & ma!matics in/ruction2 & 7,o7 requir$ environm5tal rem$iation relat$ to facilities mod]nization1 r5ovation1 or repair activities describ$ 9 subp>agraphs 7,a7 ?r\gh 7,n74 7#g7 ,outly+ area ,! t]m outly+ area means ! ,u4,s4 ,virg9 ,isl&s1 ,guam1 ,am]ican ,samoa1 ! ,commonweal? ( ! ,nor!rn ,m>iana ,isl&s1 & ! ,republic ( ,palau4 7#h7 ,/ate ,! t]m ,/ate means ea* ( ! #ej ,/ates ( ! ,unit$ ,/ates1 ! ,commonweal? ( ,pu]to ,rico1 & ! ,di/rict ( ,columbia4 #gda4 ,buy ,am]ican ,section #afje ( division ,a ( ! ,am]ican ,recov]y & ,re9ve/m5t ,act ( #bjji 7,public ,law #aaa-e7 applies to funds made available "u ?is title4 ,c ,transportation ,infra/ructure ,inve/m5ts ,i ,imm$iate transportation infra/ructure inve/m5ts #gea4 ,imm$iate transportation infra/ructure inve/m5ts 7a7 ,grants-,9-,aid = airports 7#a7 ,9 g5]al ,!re is made available to ! ,secret>y ( ,transportation #f1jjj1jjj1jjj to c>ry out airport improvem5t "u sub*apt] ,i ( *apt] #dga & sub*apt] ,i ( *apt] #dge ( title #di1 ,unit$ ,/ates ,code4 7#b7 ,f$]al %>e2 limitation on obligations ,! ,f$]al %>e payable ( ! co/s = :i* a grant is made "u ?is subsection1 %all be #ajj p]c5t4 ,! am\nt made available "u ?is subsection %all n be subject to any limitation on obligations = ! ,grants-,9-,aid = ,airports program set =? 9 any ,act or 9 title #di1 ,unit$ ,/ates ,code4 7#c7 ,di/ribution ( funds ,funds provid$ to ! ,secret>y "u ?is subsection %all n be subject to apportionm5t =mulas1 special apportionm5t categories1 or m9imum p]c5tages "u *apt] #dga ( su* title4 7#d7 ,availability ,! am\nts made available "u ?is subsection %all be available = obligation until ! date t is two ye>s aft] ! date ( ! enactm5t ( ?is ,act4 ,! ,secret>y %all obligate am\nts total+ n less ?an #ej p]c5t ( ! funds made available )9 "o ye> ( enactm5t & obligate rema9+ am\nts n lat] ?an two ye>s aft] enactm5t4 7#e7 ,adm9i/rative exp5ses ,( ! funds made available "u ?is subsection1 #j4c p]c5t %all be available to ! ,secret>y = adm9i/rative exp5ses1 %all rema9 available = obligation until ,septemb] #cj1 #bjae1 & may be us$ 9 conjunction ) funds o!rwise provid$ = ! adm9i/ration ( ! ,grants-,9-,aid = ,airports program4 7b7 ,next g5]ation air traffic control advancem5ts 7#a7 ,9 g5]al ,!re is made available to ! ,secret>y ( ,transportation #c1jjj1jjj1jjj = necess>y ,f$]al ,aviation ,adm9i/ration capital1 rese>*1 & op]at+ co/s to c>ry out ,next ,g5]ation air traffic control sy/em advancem5ts4 7#b7 ,availability ,! am\nts made available "u ?is subsection %all be available = obligation until ! date t is two ye>s aft] ! date ( ! enactm5t ( ?is ,act4 7c7 ,highway infra/ructure inve/m5t 7#a7 ,9 g5]al ,!re is made available to ! ,secret>y ( ,transportation #ha1jjj1jjj1jjj = re/oration1 repair1 con/ruction & o!r activities eligible "u section #acc7;b7 ( title #bc1 ,unit$ ,/ates ,code1 & = pass5g] & freight rail transportation & port infra/ructure projects eligible = assi/ance "u section #fja7;a77#h7 ( title #bc4 7#b7 ,f$]al %>e2 limitation on obligations ,! ,f$]al %>e payable on acc\nt ( any project or activity c>ri$ out ) funds made available "u ?is subsection %all be1 at ! option ( ! recipi5t1 up to #ajj p]c5t ( ! total co/ !re(4 ,! am\nt made available "u ?is subsection %all n be subject to any limitation on obligations = ,f$]al-aid highways & highway safety con/ruction programs set =? 9 any ,act or 9 title #bc1 ,unit$ ,/ates ,code4 7#c7 ,availability ,! am\nts made available "u ?is subsection %all be available = obligation until ! date t is two ye>s aft] ! date ( ! enactm5t ( ?is ,act4 ,! ,secret>y %all obligate am\nts total+ n less ?an #ej p]c5t ( ! funds made available )9 "o ye> ( enactm5t & obligate rema9+ am\nts n lat] ?an two ye>s aft] enactm5t4 7#d7 ,di/ribution ( funds ,( ! funds provid$ 9 ?is subsection1 aft] mak+ ! set-asides requir$ by p>agraphs 7#i71 7#aj71 7#aa71 7#ab71 & 7#ae71 #ej p]c5t ( ! funds %all be apportion$ to ,/ates us+ ! =mula set =? 9 section #ajd7;b77#c7 ( title #bc1 ,unit$ ,/ates ,code1 & ! rema9+ funds %all be apportion$ to ,/ates 9 ! same ratio z ! obligation limitation = fiscal ye> #bjaj 0 di/ribut$ among ! ,/ates 9 accordance ) ! =mula specifi$ 9 section #abj7;a77#f7 ( division ,a ( ,public ,law #aaa-aag4 7#e7 ,apportionm5t ,apportionm5ts "u p>agraph 7#d7 %all be made n lat] ?an #cj days aft] ! date ( ! enactm5t ( ?is ,act4 7#f7 ,r$i/ribution 7,a7 ,! ,secret>y %all1 #ahj days foll[+ ! date ( apportionm5t1 )draw f ea* ,/ate an am\nt equal to #ej p]c5t ( ! funds apportion$ "u p>agraph 7#d7 to t ,/ate 7exclud+ funds suballocat$ )9 ! ,/ate7 less ! am\nt ( fund+ obligat$ 7exclud+ funds suballocat$ )9 ! ,/ate71 & ! ,secret>y %all r$i/ribute su* am\nts to o!r ,/ates t h _h no funds )drawn "u ?is subp>agraph 9 ! mann] describ$ 9 section #abj7;c7 ( division ,a ( ,public ,law #aaa-aag4 7,b7 ,"o ye> foll[+ ! date ( apportionm5t1 ! ,secret>y %all )draw f ea* recipi5t ( funds apportion$ "u p>agraph 7#d7 any unobligat$ funds1 & ! ,secret>y %all r$i/ribute su* am\nts to ,/ates t h _h no funds )drawn "u ?is p>agraph 7exclud+ funds suballocat$ )9 ! ,/ate7 9 ! mann] describ$ 9 section #abj7;c7 ( division ,a ( ,public ,law #aaa-aag4 7,c7 ,at ! reque/ ( a ,/ate1 ! ,secret>y may provide an ext5sion ( ! "o-ye> p]iod only to ! ext5t t ! ,secret>y det]m9es t ! ,/ate has enc\nt]$ extreme conditions t create an unworkable bidd+ environm5t or o!r ext5uat+ circum/ances4 ,be=e grant+ an ext5sion1 ! ,secret>y %all notify 9 writ+ ! ,committee on ,transportation & ,infra/ructure & ! ,committee on ,environm5t & ,public ,works1 provid+ a ?or\gh ju/ification = ! ext5sion4 7#g7 ,pu]to ,rico & t]ritorial highway programs ,( ! funds provid$ "u ?is subsection1 #cae1jjj1jjj %all be set aside = ! ,pu]to ,rico highway program & #ace1jjj1jjj %all be = ! t]ritorial highway program au?oriz$ "u section #afe ( title #bc1 ,unit$ ,/ates ,code4 7#h7 ,f$]al l&s & ,indian res]vations ,( ! funds provid$ "u ?is subsection1 #a1fej1jjj1jjj %all be set aside = inve/m5ts 9 transportation at ,indian res]vations & ,f$]al l&s 9 accordance ) ! foll[+34 7,a7 ,( ! funds set aside by ?is p>agraph1 #icj1jjj1jjj %all be = ! ,indian ,res]vation ,roads program1 #eaj1jjj1jjj %all be = ! ,p>k ,roads & ,p>kways program1 #ahj1jjj1jjj %all be = ! ,=e/ ,highway ,program1 & #cj1jjj1jjj %all be = ! ,refuge ,roads program4 7,b7 ,= inve/m5ts at ,indian res]vations & ,f$]al l&s1 priority %all be giv5 to capital inve/m5ts1 & to projects & activities t c be complet$ )9 #b ye>s ( enactm5t ( ?is ,act4 7,c7 ,"o ye> foll[+ ! enactm5t ( ?is ,act1 to ensure ! prompt use ( ! fund+ provid$ = inve/m5ts at ,indian res]vations & ,f$]al l&s1 ! ,secret>y %all h ! au?ority to r$i/ribute unobligat$ funds )9 ! respective program = :i* ! funds 7 appropriat$4 7,d7 ,up to f\r p]c5t ( ! fund+ provid$ = ,indian ,res]vation ,roads may be us$ by ! ,secret>y ( ! ,int]ior = program managem5t & ov]sight & project-relat$ adm9i/rative exp5ses4 7#i7 ,job tra9+ ,( ! funds provid$ "u ?is subsection1 #aej1jjj1jjj %all be set aside = ! developm5t & adm9i/ration ( transportation tra9+ programs "u section #adj7;b7 title #bc1 ,unit$ ,/ates ,code4 7,a7 ,funds set aside "u ?is subsection %all be competitively aw>d$ & us$ = ! purpose ( provid+ tra9+1 appr5tice%ip 7includ+ ,regi/]$ ,appr5tice%ip71 skill developm5t1 & skill improvem5t programs1 z well z summ] transportation in/itutes & may be transf]r$ to1 or adm9i/]$ 9 p>tn]%ip )1 ! ,secret>y ( ,labor & %all demon/rate to ! ,secret>y ( ,transportation program outcomes1 includ+-- 7i7 impact on areas ) transportation work=ce %ortages2 7ii7 div]sity ( tra9+ p>ticipants2 7iii7 numb] ( p>ticipants obta9+ c]tifications or cr$5tials requir$ = specific types ( employm5t2 7iv7 employm5t outcome metrics1 su* z job placem5t & job ret5tion rates1 e/abli%$ 9 consultation ) ! ,secret>y ( ,labor & consi/5t ) metrics us$ by programs "u ! ,work=ce ,inve/m5t ,act2 7v7 to ! ext5t practical1 evid5ce t ! program did n preclude work]s t p>ticipate 9 tra9+ or appr5tice%ip activities "u ! program f be+ ref]r$ to1 or hir$ on1 projects fund$ "u ?is *apt]2 & 7vi7 id5tification ( areas ( collaboration ) ! ,dep>tm5t ( ,labor programs1 includ+ co-enrollm5t4 7,b7 ,to be eligible to receive a competitively aw>d$ grant "u ?is subsection1 a ,/ate mu/ c]tify t at lea/ #j4a p]c5t ( ! am\nts apportion$ "u ! ,surface ,transportation ,program & ,bridge ,program w be obligat$ 9 ! fir/ fiscal ye> aft] enactm5t ( ?is act = job tra9+ activities consi/5t ) section #adj7;b7 ( title #bc1 ,unit$ ,/ates ,code4 7#aj7 ,disadvantag$ bus9ess ent]prises ,( ! funds provid$ "u ?is subsection1 #cj1jjj1jjj %all be set aside = tra9+ programs & assi/ance programs "u section #adj7;c7 ( title #bc1 ,unit$ ,/ates ,code4 ,funds set aside "u ?is p>agraph %\ld be allocat$ to bus9esses t h prov5 success 9 add+ /aff :ile effectively complet+ projects4 7#aa7 ,/ate plann+ & ov]sight exp5ses ,( am\nts apportion$ "u p>agraph 7#d7 ( ?is subsection1 a ,/ate may use up to #j4e p]c5t = activities relat$ to projects fund$ "u ?is subsection1 includ+ activities eligible "u sections #acd & #ace ( title #bc1 ,unit$ ,/ates ,code1 ,/ate adm9i/ration ( subgrants1 & ,/ate ov]sight ( subrecipi5ts4 7#ab7 ,conditions 7,a7 ,funds made available "u ?is subsection %all be adm9i/]$ z if apportion$ "u *apt] #a ( title #bc1 ,unit$ ,/ates ,code1 except = funds made available = inve/m5ts 9 transportation at ,indian res]vations & ,f$]al l&s1 & = ! t]ritorial highway program1 :i* %all be adm9i/]$ 9 accordance ) *apt] #b ( title #bc1 ,unit$ ,/ates ,code1 & except = funds made available = disadvantag$ bus9ess ent]prises bond+ assi/ance1 :i* %all be adm9i/]$ 9 accordance ) *apt] #c ( title #di1 ,unit$ ,/ates ,code4 7,b7 ,funds made available "u ?is subsection %all n be obligat$ = ! purposes au?oriz$ "u section #aae7;b7 ( title #bc1 ,unit$ ,/ates ,code4 7,c7 ,fund+ provid$ "u ?is subsection %all be 9 addition to any & all funds provid$ = fiscal ye>s #bjaa & #bjab 9 any o!r ,act = ,f$]al-aid ,highways & %all n affect ! di/ribution ( funds provid$ = ,f$]al-aid ,highways 9 any o!r ,act4 7,d7 ,section #aaja7;b7 ( ,public ,law #aji-ei %all apply to funds apportion$ "u ?is subsection4 7#ac7 ,ov]sight ,! ,adm9i/rator ( ! ,f$]al ,highway ,adm9i/ration may set aside up to #j4ae p]c5t ( ! funds provid$ "u ?is subsection to fund ! ov]sight by ! ,adm9i/rator ( projects & activities c>ri$ out ) funds made available to ! ,f$]al ,highway ,adm9i/ration 9 ?is ,act1 & su* funds %all be available ?r\gh ,septemb] #cj1 #bjae4 7d7 ,capital assi/ance = high spe$ rail corridors & int]city pass5g] rail s]vice 7#a7 ,9 g5]al ,!re is made available to ! ,secret>y ( ,transportation #ab1jjj1jjj1jjj = grants = high-spe$ rail projects z au?oriz$ "u sections #bfajd & #bfajf ( title #di1 ,unit$ ,/ates ,code1 capital inve/m5t grants to support int]city pass5g] rail s]vice z au?oriz$ "u section #bddjf ( title #di1 ,unit$ ,/ates ,code1 & conge/ion grants z au?oriz$ "u section #bdaje ( title #di1 ,unit$ ,/ates ,code1 & to ent] into coop]ative agreem5ts = ^! purposes z au?oriz$1 except t ! ,adm9i/rator ( ! ,f$]al ,railroad ,adm9i/ration may reta9 up to "o p]c5t ( ! funds provid$ "u ?is head+ to fund ! aw>d & ov]sight by ! ,adm9i/rator ( grants made "u ?is subsection1 :i* reta9$ am\nt %all rema9 available = obligation until ,septemb] #cj1 #bjae4 7#b7 ,availability ,! am\nts made available "u ?is subsection %all be available = obligation until ! date t is two ye>s aft] ! date ( ! enactm5t ( ?is ,act4 ,! ,secret>y %all obligate am\nts total+ n less ?an #ej p]c5t ( ! funds made available )9 "o ye> ( enactm5t & obligate rema9+ am\nts n lat] ?an two ye>s aft] enactm5t4 7#c7 ,f$]al %>e ,! ,f$]al %>e payable ( ! co/s = :i* a grant or coop]ative agreem5ts is made "u ?is subsection %all be1 at ! option ( ! recipi5t1 up to #ajj p]c5t4 7#d7 ,int]im guidance ,! ,secret>y %all issue int]im guidance to applicants cov]+ application proc$ures & adm9i/] ! grants provid$ "u ?is subsection pursuant to t guidance until f9al regulations are issu$4 7#e7 ,int]city pass5g] rail corridors ,n less ?an #he p]c5t ( ! funds provid$ "u ?is subsection %all be = coop]ative agreem5ts t lead to ! developm5t ( entire segm5ts or phases ( int]city or high-spe$ rail corridors4 7#f7 ,conditions 7,a7 ,9 addition to ! provisions ( title #di1 ,unit$ ,/ates ,code1 t apply to ea* ( ! individual programs fund$ "u ?is subsection1 subsections #bddjb7;a77#b71 #bddjb7;i71 & #bddjc7;a7 & 7c7 ( title #di1 ,unit$ ,/ates ,code1 %all also apply to ! provision ( funds provid$ "u ?is subsection4 7,b7 ,a project ne$ n be 9 a ,/ate rail plan develop$ "u *apt] #bbg ( title #di1 ,unit$ ,/ates ,code1 to be eligible = assi/ance "u ?is subsection4 7,c7 ,recipi5ts ( grants "u ?is p>agraph %all conduct all procurem5t transactions us+ su* grant funds 9 a mann] t provides full & op5 competition1 z det]m9$ by ! ,secret>y1 9 compliance ) exi/+ labor agreem5ts4 7e7 ,capital grants to ! national railroad pass5g] corporation 7#a7 ,9 g5]al ,!re is made available #f1jjj1jjj1jjj to enable ! ,secret>y ( ,transportation to make capital grants to ! ,national ,railroad ,pass5g] ,corporation 7,amtrak71 z au?oriz$ by section #aja7;c7 ( ! ,pass5g] ,rail ,inve/m5t & ,improvem5t ,act ( #bjjh 7,public ,law #aaj-dcb74 7#b7 ,availability ,! am\nts made available "u ?is subsection %all be available = obligation until ! date t is two ye>s aft] ! date ( ! enactm5t ( ?is ,act4 ,! ,secret>y %all obligate am\nts total+ n less ?an #ej p]c5t ( ! funds made available )9 "o ye> ( enactm5t & obligate rema9+ am\nts n lat] ?an two ye>s aft] enactm5t4 7#c7 ,project priority ,! priority = ! use ( funds %all be giv5 to projects = ! repair1 rehabilitation1 or upgrade ( railroad assets or infra/ructure1 & = capital projects t exp& pass5g] rail capacity includ+ ! rehabilitation ( roll+ /ock4 7#d7 ,conditions 7,a7 ,none ( ! funds "u ?is subsection %all be us$ to subsidize ! op]at+ losses ( ,amtrak4 7,b7 ,! funds provid$ "u ?is subsection %all be aw>d$ n lat] ?an #ij days aft] ! date ( enactm5t ( ?is ,act4 7,c7 ,! ,secret>y %all take measures to ensure t projects fund$ "u ?is subsection %all be complet$ )9 #b ye>s ( enactm5t ( ?is ,act1 & %all s]ve to supplem5t & n supplant plann$ exp5ditures = su* activities f o!r ,f$]al1 ,/ate1 local & corporate s\rces4 ,! ,secret>y %all c]tify to ! ,h\se & ,s5ate ,committees on ,appropriations 9 writ+ compliance ) ! prec$+ s5t5ce4 7#e7 ,ov]sight ,! ,adm9i/rator ( ! ,f$]al ,railroad ,adm9i/ration may set aside #j4e p]c5t ( ! funds provid$ "u ?is subsection to fund ! ov]sight by ! ,adm9i/rator ( projects & activities c>ri$ out ) funds made available 9 ?is subsection1 & su* funds %all be available ?r\gh ,septemb] #cj1 #bjae4 7f7 ,transit capital assi/ance 7#a7 ,9 g5]al ,!re is made available to ! ,secret>y ( ,transportation #i1jjj1jjj1jjj = grants = transit capital assi/ance grants z def9$ by section #ecjb7;a77#c7 ( title #di1 ,unit$ ,/ates ,code4 ,not)/&+ any provision ( *apt] #ec ( title #di1 h[ev]1 a recipi5t ( fund+ "u ?is subsection may use up to #aj p]c5t ( ! am\nt provid$ = ! op]at+ co/s ( equipm5t & facilities = use 9 public transportation or = o!r eligible activities4 7#b7 ,f$]al %>e2 limitation on obligations ,! applicable requirem5ts ( *apt] #ec ( title #di1 ,unit$ ,/ates ,code1 %all apply to fund+ provid$ "u ?is subsection1 except t ! ,f$]al %>e ( ! co/s = :i* any grant is made "u ?is subsection %all be1 at ! option ( ! recipi5t1 up to #ajj p]c5t4 ,! am\nt made available "u ?is subsection %all n be subject to any limitation on obligations = transit programs set =? 9 any ,act or *apt] #ec ( title #di4 7#c7 ,availability ,! am\nts made available "u ?is subsection %all be available = obligation until ! date t is two ye>s aft] ! date ( ! enactm5t ( ?is ,act4 ,! ,secret>y %all obligate am\nts total+ n less ?an #ej p]c5t ( ! funds made available )9 "o ye> ( enactm5t & obligate rema9+ am\nts n lat] ?an two ye>s aft] enactm5t4 7#d7 ,di/ribution ( funds ,! ,secret>y ( ,transportation %all-- 7,a7 provide #hj p]c5t ( ! funds appropriat$ "u ?is subsection = grants "u section #ecjg ( title #di1 ,unit$ ,/ates ,code1 & apportion su* funds 9 accordance ) section #eccf ( su* title2 7,b7 provide #aj p]c5t ( ! funds appropriat$ "u ?is subsection 9 accordance ) section #ecdj ( su* title2 & 7,c7 provide #aj p]c5t ( ! funds appropriat$ "u ?is subsection = grants "u section #ecaa ( title #di1 ,unit$ ,/ates ,code1 & apportion su* funds 9 accordance ) su* section4 7#e7 ,apportionm5t ,! funds apportion$ "u ?is subsection %all be apportion$ n lat] ?an #ba days aft] ! date ( ! enactm5t ( ?is ,act4 7#f7 ,r$i/ribution 7,a7 ,! ,secret>y %all1 #ahj days foll[+ ! date ( apportionm5t1 )draw f ea* urbaniz$ area or ,/ate an am\nt equal to #ej p]c5t ( ! funds apportion$ to su* urbaniz$ areas or ,/ates less ! am\nt ( fund+ obligat$1 & ! ,secret>y %all r$i/ribute su* am\nts to o!r urbaniz$ areas or ,/ates t h _h no funds )drawn "u ?is proviso utiliz+ :atev] me?od he deems appropriate to ensure t all funds r$i/ribut$ "u ?is proviso %all be utiliz$ promptly4 7,b7 ,"o ye> foll[+ ! date ( apportionm5t1 ! ,secret>y %all )draw f ea* urbaniz$ area or ,/ate any unobligat$ funds1 & ! ,secret>y %all r$i/ribute su* am\nts to o!r urbaniz$ areas or ,/ates t h _h no funds )drawn "u ?is proviso utiliz+ :atev] me?od ! ,secret>y deems appropriate to ensure t all funds r$i/ribut$ "u ?is proviso %all be utiliz$ promptly4 7,c7 ,at ! reque/ ( an urbaniz$ area or ,/ate1 ! ,secret>y ( ,transportation may provide an ext5sion ( su* #a-ye> p]iod if ! ,secret>y det]m9es t ! urbaniz$ area or ,/ate has enc\nt]$ an unworkable bidd+ environm5t or o!r ext5uat+ circum/ances4 ,be=e grant+ an ext5sion1 ! ,secret>y %all notify 9 writ+ ! ,committee on ,transportation & ,infra/ructure & ! ,committee on ,bank+1 ,h\s+ & ,urban ,affairs1 provid+ a ?or\gh ju/ification = ! ext5sion4 7#g7 ,conditions 7,a7 ,( ! funds provid$ = section #ecaa ( title #di1 ,unit$ ,/ates ,code1 #b4e p]c5t %all be made available = section #ecaa7;c77#a74 7,b7 ,section #aaja7;b7 ( ,public ,law #aji-ei %all apply to funds appropriat$ "u ?is subsection4 7,c7 ,! funds appropriat$ "u ?is subsection %all n be com+l$ ) any prior ye> funds4 7#h7 ,ov]sight ,not)/&+ any o!r provision ( law1 #j4c p]c5t ( ! funds provid$ = grants "u section #ecjg & section #ecdj1 & #j4c p]c5t ( ! funds provid$ = grants "u section #ecaa1 %all be available = adm9i/rative exp5ses & program managem5t ov]sight1 & su* funds %all be available ?r\gh ,septemb] #cj1 #bjae4 7g7 ,/ate ( good repair 7#a7 ,9 g5]al ,!re is made available to ! ,secret>y ( ,transportation #ah1jjj1jjj1jjj = capital exp5ditures z au?oriz$ by section #ecji7;b77#e7 ( title #di1 ,unit$ ,/ates ,code4 7#b7 ,f$]al %>e ,! applicable requirem5ts ( *apt] #ec ( title #di1 ,unit$ ,/ates ,code1 %all apply1 except t ! ,f$]al %>e ( ! co/s = :i* a grant is made "u ?is subsection %all be1 at ! option ( ! recipi5t1 up to #ajj p]c5t4 7#c7 ,availability ,! am\nts made available "u ?is subsection %all be available = obligation until ! date t is two ye>s aft] ! date ( ! enactm5t ( ?is ,act4 ,! ,secret>y %all obligate am\nts total+ n less ?an #ej p]c5t ( ! funds made available )9 "o ye> ( enactm5t & obligate rema9+ am\nts n lat] ?an two ye>s aft] enactm5t4 7#d7 ,di/ribution ( funds 7,a7 ,! ,secret>y ( ,transportation %all apportion n less ?an #ge p]c5t ( ! funds "u ?is subsection = ! mod]nization ( fix$ guideway sy/ems1 pursuant to ! =mula set =? 9 section #eccf7;b7 title #di1 ,unit$ ,/ates ,code1 o!r ?an subsection 7b77#b77;,a77ii74 7,b7 ,( ! funds appropriat$ "u ?is subsection1 n less ?an #be p]c5t %all be available = ! re/oration or replacem5t ( exi/+ public transportation assets relat$ to bus sy/ems1 pursuant to ! =mula set =? 9 section #eccf o!r ?an subsection 7b74 7#e7 ,apportionm5t ,! funds made available "u ?is subsection %all be apportion$ n lat] ?an #cj days aft] ! date ( ! enactm5t ( ?is ,act4 7#f7 ,r$i/ribution 7,a7 ,! ,secret>y %all1 #ahj days foll[+ ! date ( apportionm5t1 )draw f ea* urbaniz$ area an am\nt equal to #ej p]c5t ( ! funds apportion$ to su* urbaniz$ area less ! am\nt ( fund+ obligat$1 & ! ,secret>y %all r$i/ribute su* am\nts to o!r urbaniz$ areas t h _h no funds )drawn "u ?is p>agraph utiliz+ :atev] me?od ! ,secret>y deems appropriate to ensure t all funds r$i/ribut$ "u ?is p>agraph %all be utiliz$ promptly4 7,b7 ,"o ye> foll[+ ! date ( apportionm5t1 ! ,secret>y %all )draw f ea* urbaniz$ area any unobligat$ funds1 & ! ,secret>y %all r$i/ribute su* am\nts to o!r urbaniz$ areas t h _h no funds )drawn "u ?is p>agraph1 utiliz+ :atev] me?od ! ,secret>y deems appropriate to ensure t all funds r$i/ribut$ "u ?is p>agraph %all be utiliz$ promptly4 7,c7 ,at ! reque/ ( an urbaniz$ area1 ! ,secret>y may provide an ext5sion ( ! #a-ye> p]iod if ! ,secret>y f9ds t ! urbaniz$ area has enc\nt]$ an unworkable bidd+ environm5t or o!r ext5uat+ circum/ances4 ,be=e grant+ an ext5sion1 ! ,secret>y %all notify ! ,committee on ,transportation & ,infra/ructure & ! ,committee on ,bank+1 ,h\s+1 & ,urban ,affairs1 provid+ a ?or\gh ju/ification = ! ext5sion4 7#g7 ,conditions 7,a7 ,! provisions ( section #aaja7;b7 ( ,public ,law #aji-ei %all apply to funds made available "u ?is subsection4 7,b7 ,! funds appropriat$ "u ?is subsection %all n be comm+l$ ) any prior ye> funds4 7#h7 ,ov]sight ,not)/&+ any o!r provision ( law1 #j4c p]c5t ( ! funds "u ?is subsection %all be available = adm9i/rative exp5ses & program managem5t ov]sight & %all rema9 available = obligation until ,septemb] #cj1 #bjae4 7h7 ,transportation infra/ructure grants & f9anc+ 7#a7 ,9 g5]al ,!re is made available to ! ,secret>y ( ,transportation #ae1jjj1jjj1jjj = capital inve/m5ts 9 surface transportation infra/ructure4 ,! ,secret>y %all di/ribute funds provid$ "u ?is subsection z discretion>y grants to be aw>d$ to ,/ate & local gov]nm5ts or transit ag5cies on a competitive basis = projects t w h a significant impact on ! ,nation1 a metropolitan area1 or a region4 7#b7 ,f$]al %>e2 limitation on obligations ,! ,f$]al %>e payable ( ! co/s = :i* a grant is made "u ?is subsection1 %all be #ajj p]c5t4 7#c7 ,availability ,! am\nts made available "u ?is subsection %all be available = obligation until ! date t is two ye>s aft] ! date ( ! enactm5t ( ?is ,act4 ,! ,secret>y %all obligate am\nts total+ n less ?an #ej p]c5t ( ! funds made available )9 "o ye> ( enactm5t & obligate rema9+ am\nts n lat] ?an two ye>s aft] enactm5t4 7#d7 ,project eligibility ,projects eligible = fund+ provid$ "u ?is subsection include-- 7,a7 highway or bridge projects eligible "u title #bc1 ,unit$ ,/ates ,code1 includ+ int]/ate rehabilitation1 improvem5ts to ! rural collector road sy/em1 ! recon/ruction ( ov]passes & int]*anges1 bridge replacem5ts1 seismic retr(it projects = bridges1 & road realignm5ts2 7,b7 public transportation projects eligible "u *apt] #ec ( title #di1 ,unit$ ,/ates ,code1 includ+ inve/m5ts 9 projects p>ticipat+ 9 ! ,new ,/>ts or ,small ,/>ts programs t w exp$ite ! completion ( ^? projects & _! entry into rev5ue s]vice2 7,c7 pass5g] & freight rail transportation projects2 & 7,d7 port infra/ructure inve/m5ts1 includ+ projects t connect ports to o!r modes ( transportation & improve ! effici5cy ( freight movem5t4 7#e7 ,,tifia program ,! ,secret>y may transf] to ! ,f$]al ,highway ,adm9i/ration funds made available "u ?is subsection = ! purpose ( pay+ ! subsidy & adm9i/rative co/s ( projects eligible = ,f$]al cr$it assi/ance "u *apt] #f ( title #bc1 ,unit$ ,/ates ,code1 if ! ,secret>y f9ds t su* use ( ! funds w\ld advance ! purposes ( ?is subsection4 7#f7 ,project priority ,! ,secret>y %all give priority to projects t are expect$ to be complet$ )9 #c ye>s ( ! date ( ! enactm5t ( ?is ,act4 7#g7 ,deadl9e = issuance ( competition crit]ia ,! ,secret>y %all publi% crit]ia on :i* to base ! competition = any grants aw>d$ "u ?is subsection n lat] ?an #ij days aft] enactm5t ( ?is ,act4 ,! ,secret>y %all require applications = fund+ provid$ "u ?is subsection to be submitt$ n lat] ?an #ahj days aft] ! publication ( ! crit]ia1 & ann\nce all projects select$ to be fund$ f su* funds n lat] ?an #a ye> aft] ! date ( ! enactm5t ( ! ,act4 7#h7 ,applicability ( title #dj ,ea* project conduct$ us+ funds provid$ "u ?is subsection %all comply ) ! requirem5ts ( sub*apt] ,,iv ( *apt] #ca ( title #dj1 ,unit$ ,/ates ,code4 7#i7 ,adm9i/rative exp5ses ,! ,secret>y may reta9 up to "o half ( "o p]c5t ( ! funds provid$ "u ?is subsection1 & may transf] portions ( ^? funds to ! ,adm9i/rators ( ! ,f$]al ,highway ,adm9i/ration1 ! ,f$]al ,transit ,adm9i/ration1 ! ,f$]al ,railroad ,adm9i/ration & ! ,m>itime ,adm9i/ration1 to fund ! aw>d & ov]sight ( grants made "u ?is subsection4 ,funds reta9$ %all rema9 available = obligation until ,septemb] #cj1 #bjae4 7i7 ,local hir+ 7#a7 ,9 g5]al ,9 ! case ( ! fund+ made available "u subsections 7a7 ?r\gh 7h7 ( ?is section1 ! ,secret>y ( ,transportation may e/abli% /&>ds "u :i* a contract = con/ruction may be adv]tis$ t conta9s requirem5ts = ! employm5t ( individuals resid+ 9 or adjac5t to any ( ! areas 9 :i* ! "w is to be p]=m$ to p]=m con/ruction "w requir$ "u ! contract1 provid$ t-- 7,a7 all or "p ( ! con/ruction "w p]=m$ "u ! contract occurs 9 an area designat$ by ! ,secret>y z an area ( high unemploym5t1 us+ data report$ by ! ,unit$ ,/ates ,dep>tm5t ( ,labor1 ,bureau ( ,labor ,/ati/ics2 7,b7 ! e/imat$ co/ ( ! project ( :i* ! contract is a "p is great] ?an #aj1jjj1jjj1 except t ! e/imat$ co/ ( ! project 9 ! case ( con/ruction fund$ "u subsection 7c7 %all be great] ?an #ej1jjj1jjj2 & 7,c7 ! recipi5t may n require ! hir+ ( individuals :o d n h ! necess>y skills to p]=m "w 9 any craft or trade2 provid$ t ! recipi5t may require ! hir+ ( su* individuals if ! recipi5t e/abli%es reasonable provisions to tra9 su* individuals to p]=m any su* "w "u ! contract effectively4 7#b7 ,project /&>ds ,any /&>ds e/abli%$ by ! ,secret>y "u ?is section %all ensure t any requirem5ts specifi$ "u subsection 7c77#i7-- 7,a7 d n compromise ! quality ( ! project2 7,b7 are reasonable 9 scope & application2 7,c7 d n unreasonably delay ! completion ( ! project2 & 7,d7 d n unreasonably increase ! co/ ( ! project4 7#c7 ,implem5t+ regulations ,! ,secret>y %all promulgate f9al regulations to implem5t ! au?ority ( ?is subsection4 7j7 ,adm9i/rative provisions 7#a7 ,applicability ( title #dj ,ea* project conduct$ us+ funds provid$ "u ?is subtitle %all comply ) ! requirem5ts ( sub*apt] ,,iv ( *apt] #ca ( title #dj1 ,unit$ ,/ates ,code4 7#b7 ,buy ,am]ican ,section #afje ( division ,a ( ! ,am]ican ,recov]y & ,re9ve/m5t ,act ( #bjji 7,public ,law #aaa-e7 applies to ea* project conduct$ us+ funds provid$ "u ?is subtitle4 ,,ii ,build+ & upgrad+ infra/ructure = long-,t]m developm5t ,a ,imm$iate transportation infra/ructure inve/m5ts #gfa4 ,%ort title ,?is "p may be cit$ z ! ,build+ & ,upgrad+ ,infra/ructure = ,long-,t]m ,developm5t ,act4 #gfb4 ,f9d+s & purpose 7a7 ,f9d+s ,congress f9ds t-- 7#a7 infra/ructure has always be5 a vital elem5t ( ! economic /r5g? ( ! ,unit$ ,/ates & a key indicator ( ! int]national lead]%ip ( ! ,unit$ ,/ates2 7#b7 ! ,erie ,canal1 ! ,hoov] ,dam1 ! railroads1 & ! int]/ate highway sy/em are all te/am5ts to ,am]ican +5uity & h help$ propel & ma9ta9 ! ,unit$ ,/ates z ! _w's l>ge/ economy2 7#c7 accord+ to ! ,_w ,economic ,=um's ,global ,competitiv5ess ,report1 ! ,unit$ ,/ates fell to second place 9 #bjji1 & dropp$ to f\r? place ov]all 9 #bjaj1 h[ev]1 9 ! ,quality ( ov]all infra/ructure category ( ! same report1 ! ,unit$ ,/ates rank$ tw5ty-?ird 9 ! _w2 7#d7 accord+ to ! ,_w ,bank's #bjaj ,logi/ic ,p]=mance ,index1 ! capacity ( c\ntries to effici5tly move goods & connect manufactur]s & consum]s ) int]national m>kets is improv+ ar\nd ! _w1 & ! ,unit$ ,/ates n[ ranks sev5? 9 ! _w 9 logi/ics-relat$ infra/ructure beh9d c\ntries f bo? ,europe & ,asia2 7#e7 accord+ to a ,janu>y #bjji report f ! ,univ]sity ( ,massa*usetts_/,alliance = ,am]ican ,manufactur+ entitl$ ,employm5t1 ,productivity & ,gr[?1 infra/ructure inve/m5t is a highly effective eng9e ( job creation2 7#f7 accord+ to ! ,am]ican ,society ( ,civil ,eng9e]s1 ! curr5t condition ( ! infra/ructure 9 ! ,unit$ ,/ates e>ns a grade po9t av]age ( ,d1 & an e/imat$ #b1bjj1jjj1jjj1jjj inve/m5t is ne$$ ov] ! next #e ye>s to br+ ,am]ican infra/ructure up to adequate condition2 7#g7 accord+ to ! ,national ,surface ,transportation ,policy & ,rev5ue ,/udy ,commission1 #bbe1jjj1jjj1jjj is ne$$ annually f all s\rces = ! next #ej ye>s to upgrade ! ,unit$ ,/ates surface transportation sy/em to a /ate ( good repair & create a m advanc$ sy/em2 7#h7 ! curr5t infra/ructure f9anc+ me*anisms ( ! ,unit$ ,/ates1 bo? on ! ,f$]al & ,/ate level1 w fail to meet curr5t & =eseeable dem&s & w create l>ge fund+ gaps2 7#i7 publi%$ reports /ate t !re may n be en\gh dem& = municipal bonds to ma9ta9 ! same level ( borr[+ at ! same rates1 result+ 9 significantly decreas$ infra/ructure inve/m5t at ! ,/ate & local level2 7#aj7 curr5t fund+ me*anisms are n readily scalable & d n-- 7,a7 s]ve l>ge 9-,/ate or cross jurisdiction infra/ructure projects1 projects ( regional or national significance1 or projects t cross sector silos2 7,b7 suffici5tly catalyze private sector inve/m5t2 or 7,c7 ensure ! optimal return on public res\rces2 7#aa7 al?\gh grant programs ( ! ,unit$ ,/ates ,gov]nm5t mu/ cont9ue to play a c5tral role 9 f9anc+ ! transportation1 environm5t1 & en]gy infra/ructure ne$s ( ! ,unit$ ,/ates1 curr5t & =eseeable dem&s on exi/+ ,f$]al1 ,/ate1 & local fund+ = infra/ructure expansion cle>ly exce$ ! res\rces to support ^! programs by m>g9s wide en\gh to prompt s]i\s conc]ns ab\t ! ,unit$ ,/ates ability to su/a9 long-t]m economic developm5t1 productivity1 & int]national competitiv5ess2 7#ab7 ! capital m>kets1 includ+ p5sion funds1 private equity funds1 mutual funds1 sov]eign weal? funds1 & o!r inve/ors1 h a gr[+ int]e/ 9 infra/ructure inve/m5t & repres5t hundr$s ( billions ( doll>s ( pot5tial inve/m5t2 & 7#ac7 ! e/abli%m5t ( a ,unit$ ,/ates ,gov]nm5t-own$1 indep5d5t1 pr(essionally manag$ in/itution t c\ld provide cr$it support to qualifi$ infra/ructure projects ( regional & national significance1 mak+ transp>5t m]it-bas$ inve/m5t decisions bas$ on ! comm]cial viability ( infra/ructure projects1 w\ld catalyze ! p>ticipation ( significant private inve/m5t capital4 7b7 ,purpose ,! purpose ( ?is "p is to facilitate inve/m5t 91 & long-t]m f9anc+ (1 economically viable infra/ructure projects ( regional or national significance 9 a mann] t bo? complem5ts exi/+ ,f$]al1 ,/ate1 local1 & private fund+ s\rces = ^! projects & introduces a m]it-bas$ sy/em = f9anc+ su* projects1 9 ord] to mobilize significant private sector inve/m5t1 create jobs1 & ensure ,unit$ ,/ates competitiv5ess ?r\gh an in/itution t limits ! ne$ = ongo+ ,f$]al fund+4 #gfc4 ,def9itions ,= purposes ( ?is "p1 ! foll[+ def9itions %all apply3 7#a7 ,,aifa ,! t]m ,,aifa means ! ,am]ican ,infra/ructure ,f9anc+ ,au?ority e/abli%$ "u ?is "p4 7#b7 ,bl9d tru/ ,! t]m bl9d tru/ means a tru/ 9 :i* ! b5efici>y has no k ( ! specific hold+s & no rights ov] h[ ^? hold+s are manag$ by ! fiduci>y ( ! tru/ prior to ! dissolution ( ! tru/4 7#c7 ,bo>d ( directors ,! t]m ,bo>d ( ,directors means ,bo>d ( ,directors ( ,,aifa4 7#d7 ,*airp]son ,! t]m ,*airp]son means ! ,*airp]son ( ! ,bo>d ( ,directors ( ,,aifa4 7#e7 ,*ief executive (fic] ,! t]m *ief executive (fic] means ! *ief executive (fic] ( ,,aifa1 appo9t$ "u section #gfg4 7#f7 ,co/ ,! t]m co/ has ! same mean+ z 9 section #ejb ( ! ,f$]al ,cr$it ,re=m ,act ( #aiij 7#b ,u4,s4,c4 #ffa;a74 7#g7 ,direct loan ,! t]m direct loan has ! same mean+ z 9 section #ejb ( ! ,f$]al ,cr$it ,re=m ,act ( #aiij 7#b ,u4,s4,c4 #ffa;a74 7#h7 ,eligible entity ,! t]m eligible entity means an individual1 corporation1 p>tn]%ip 7includ+ a public-private p>tn]%ip71 jo9t v5ture1 tru/1 ,/ate1 or o!r non-,f$]al gov]nm5tal entity1 includ+ a political subdivision or any o!r in/rum5tality ( a ,/ate1 or a revolv+ fund4 7#i7 ,infra/ructure project 7,a7 ,9 g5]al ,! t]m eligible infra/ructure project means any non-,f$]al transportation1 wat]1 or en]gy infra/ructure project1 or an aggregation ( su* infra/ructure projects1 z provid$ 9 ?is "p4 7,b7 ,transportation infra/ructure project ,! t]m transportation infra/ructure project means ! con/ruction1 alt]ation1 or repair1 includ+ ! facilitation ( int]modal transit1 ( ! foll[+ subsectors3 7i7 ,highway or road4 7ii7 ,bridge4 7iii7 ,mass transit4 7iv7 ,inl& wat]ways4 7v7 ,comm]cial ports4 7vi7 ,airports4 7vii7 ,air traffic control sy/ems4 7viii7 ,pass5g] rail1 includ+ high-spe$ rail4 7ix7 ,freight rail sy/ems4 7,c7 ,wat] infra/ructure project ,! t]m wat] infra/ructure project means ! con/ruction1 consolidation1 alt]ation1 or repair ( ! foll[+ subsectors3 7i7 ,wat]wa/e treatm5t facility4 7ii7 ,/orm wat] managem5t sy/em4 7iii7 ,dam4 7iv7 ,solid wa/e disposal facility4 7v7 ,dr9k+ wat] treatm5t facility4 7vi7 ,levee4 7vii7 ,op5 space managem5t sy/em4 7,d7 ,en]gy infra/ructure project ,! t]m en]gy infra/ructure project means ! con/ruction1 alt]ation1 or repair ( ! foll[+ subsectors3 7i7 ,pollution r$uc$ en]gy g5]ation4 7ii7 ,transmission & di/ribution4 7iii7 ,/orage4 7iv7 ,en]gy effici5cy enhancem5ts = build+s1 includ+ public & comm]cial build+s4 7,e7 ,bo>d au?ority to modify subsectors ,! ,bo>d ( ,directors may make modifications1 at ! discretion ( ! ,bo>d1 to ! subsectors describ$ 9 ?is p>agraph by a vote ( n few] ?an #e ( ! vot+ memb]s ( ! ,bo>d ( ,directors4 7#aj7 ,inve/m5t prospectus 7,a7 ,! t]m inve/m5t prospectus means ! processes & publications describ$ bel[ t w guide ! priorities & /rategic focus = ! ,bank's inve/m5ts4 ,! inve/m5t prospectus %all foll[ rulemak+ proc$ures "u section #eec ( title #e1 ,unit$ ,/ates ,code4 7,b7 ,! ,bank %all publi% a detail$ description ( its /rategy 9 an ,inve/m5t ,prospectus )9 "o ye> ( ! enactm5t ( ?is sub*apt]4 ,! ,inve/m5t ,prospectus %all-- 7i7 specify :at ! ,bank %all consid] significant to ! economic competitiv5ess ( ! ,unit$ ,/ates or a region !re( 9 a mann] consi/5t ) ! prim>y objective2 7ii7 specify ! priorities & /rategic focus ( ! ,bank 9 =w>d+ its /rategic objectives & c>ry+ out ! ,bank /rategy2 7iii7 specify ! priorities & /rategic focus ( ! ,bank 9 promot+ great] effici5cy 9 ! movem5t ( freight2 7iv7 specify ! priorities & /rategic focus ( ! ,bank 9 promot+ ! use ( innovation & be/ practices 9 ! plann+1 design1 developm5t & deliv]y ( projects2 7v7 describe 9 detail ! framework & me?odology = calculat+ application qualification scores & associat$ ranges z specifi$ 9 ?is sub*apt]1 along ) ! data to be reque/$ f applicants & ! me*anics ( calculations to be appli$ to t data to det]m9e qualification scores & ranges2 7vi7 describe h[ selection crit]ia w be appli$ by ! ,*ief ,executive ,(fic] 9 det]m9+ ! competitiv5ess ( an application & its qualification score & range relative to o!r curr5t applications & previ\sly fund$ applications2 & 7vii7 describe h[ ! qualification score & range me?odology & project selection framework are consi/5t ) maximiz+ ! ,bank goals 9 bo? urban & rural areas4 7,c7 ,! ,inve/m5t ,prospectus & any subsequ5t updates !reto %all be approv$ by a majority vote ( ! ,bo>d ( ,directors prior to publication4 7,d7 ,! ,bank %all update ! ,inve/m5t ,prospectus on e bi5nial anniv]s>y ( its orig9al publication4 7#aa7 ,inve/m5t-grade rat+ ,! t]m inve/m5t-grade rat+ means a rat+ ( ,,bbb m9us1 ,baa#c1 or high] assign$ to an infra/ructure project by a rat+s ag5cy4 7#ab7 ,loan gu>antee ,! t]m loan gu>antee has ! same mean+ z 9 section #ejb ( ! ,f$]al ,cr$it ,re=m ,act ( #aiij 7#b ,u4,s4,c4 #ffa;a74 7#ac7 ,public-private p>tn]%ip ,! t]m public-private p>tn]%ip means any eligible entity-- 7,a7 7i7 :i* is und]tak+ ! developm5t ( all or "p ( an infra/ructure project t w h a public b5efit1 pursuant to requirem5ts e/abli%$ 9 "o or m contracts betwe5 ! entity & a ,/ate or an in/rum5tality ( a ,/ate2 or 7ii7 ! activities ( :i*1 ) respect to su* an infra/ructure project1 are subject to regulation by a ,/ate or any in/rum5tality ( a ,/ate2 7,b7 :i* owns1 leases1 or op]ates or w own1 lease1 or op]ate1 ! project 9 :ole or 9 "p2 & 7,c7 ! p>ticipants 9 :i* include n few] ?an #a nongov]nm5tal entity ) significant inve/m5t & "s control ov] ! project or project vehicle4 7#ad7 ,rural infra/ructure project ,! t]m rural infra/ructure project means an infra/ructure project 9 a rural area1 z t t]m is def9$ 9 section #cdc7;a77#ac77;,a7 ( ! ,consolidat$ ,f>m & ,rural ,developm5t ,act 7#g ,u4,s4,c4 #aiia7;a77#ac77;,a774 7#ae7 ,secret>y ,unless ! context o!rwise requires1 ! t]m ,secret>y means ! ,secret>y ( ! ,treasury or ! designee !re(4 7#af7 ,s5ior managem5t ,! t]m s5ior managem5t means ! *ief f9ancial (fic]1 *ief risk (fic]1 *ief compliance (fic]1 g5]al c\nsel1 *ief l5d+ (fic]1 & *ief op]ations (fic] ( ,,aifa e/abli%$ "u section #gfi1 & su* o!r (fic]s z ! ,bo>d ( ,directors may1 by majority vote1 add to s5ior managem5t4 7#ag7 ,/ate ,! t]m ,/ate includes ! ,di/rict ( ,columbia1 ,pu]to ,rico1 ,guam1 ,am]ican ,samoa1 ! ,virg9 ,isl&s1 ! ,commonweal? ( ,nor!rn ,m>iana ,isl&s1 & any o!r t]ritory ( ! ,unit$ ,/ates4 ,b ,am]ican ,infra/ructure ,f9anc+ ,au?ority #gfe4 ,e/abli%m5t & g5]al au?ority ( ,,aifa 7a7 ,e/abli%m5t ( ,,aifa ,! ,am]ican ,infra/ructure ,f9anc+ ,au?ority is e/abli%$ z a :olly own$ ,gov]nm5t corporation4 7b7 ,g5]al au?ority ( ,,aifa ,,aifa %all provide direct loans & loan gu>antees to facilitate infra/ructure projects t are bo? economically viable & ( regional or national significance1 & %all h su* o!r au?ority1 z provid$ 9 ?is "p4 7c7 ,incorporation 7#a7 ,9 g5]al ,! ,bo>d ( ,directors fir/ appo9t$ %all be deem$ ! incorporator ( ,,aifa1 & ! incorporation %all be held to h be5 effect$ f ! date ( ! fir/ meet+ ( ! ,bo>d ( ,directors4 7#b7 ,corporate (fice ,,aifa %all-- 7,a7 ma9ta9 an (fice 9 ,wa%+ton1 ,,dc2 & 7,b7 = purposes ( v5ue 9 civil actions1 be consid]$ to be a resid5t ( ,wa%+ton1 ,,dc4 7d7 ,responsibility ( ! secret>y ,! ,secret>y %all take su* action z may be necess>y to assi/ 9 implem5t+ ,,aifa1 & 9 c>ry+ out ! purpose ( ?is "p4 7e7 ,rule ( con/ruction ,*apt] #ia ( title #ca1 ,unit$ ,/ates ,code1 does n apply to ,,aifa1 unless o!rwise specifically provid$ 9 ?is "p4 #gff4 ,vot+ memb]s ( ! ,bo>d ( ,directors 7a7 ,vot+ memb]%ip ( ! bo>d ( directors 7#a7 ,9 g5]al ,,aifa %all h a ,bo>d ( ,directors consi/+ ( #g vot+ memb]s appo9t$ by ! ,presid5t1 by & ) ! advice & cons5t ( ! ,s5ate1 n m ?an #d ( :om %all be f ! same political p>ty4 7#b7 ,*airp]son ,"o ( ! vot+ memb]s ( ! ,bo>d ( ,directors %all be designat$ by ! ,presid5t to s]ve z ,*airp]son !re(4 7#c7 ,congressional recomm5dations ,n lat] ?an #cj days aft] ! date ( enactm5t ( ?is ,act1 ! majority lead] ( ! ,s5ate1 ! m9ority lead] ( ! ,s5ate1 ! ,speak] ( ! ,h\se ( ,repres5tatives1 & ! m9ority lead] ( ! ,h\se ( ,repres5tatives %all ea* submit a recomm5dation to ! ,presid5t = appo9tm5t ( a memb] ( ! ,bo>d ( ,directors1 aft] consultation ) ! appropriate committees ( ,congress4 7b7 ,vot+ rights ,ea* vot+ memb] ( ! ,bo>d ( ,directors %all h an equal vote 9 all decisions ( ! ,bo>d ( ,directors4 7c7 ,qualifications ( vot+ memb]s ,ea* vot+ memb] ( ! ,bo>d ( ,directors %all-- 7#a7 be a citiz5 ( ! ,unit$ ,/ates2 & 7#b7 h significant demon/rat$ exp]tise 9-- 7,a7 ! managem5t & adm9i/ration ( a f9ancial in/itution relevant to ! op]ation ( ,,aifa2 or a public f9ancial ag5cy or au?ority2 7,b7 ! f9anc+1 developm5t1 or op]ation ( infra/ructure projects2 or 7,c7 analyz+ ! economic b5efits ( infra/ructure inve/m5t4 7d7 ,t]ms 7#a7 ,9 g5]al ,except z o!rwise provid$ 9 ?is "p1 ea* vot+ memb] ( ! ,bo>d ( ,directors %all be appo9t$ = a t]m ( #d ye>s4 7#b7 ,initial /agg]$ t]ms ,( ! vot+ memb]s fir/ appo9t$ to ! ,bo>d ( ,directors-- 7,a7 ! initial ,*airp]son & #c ( ! o!r vot+ memb]s %all ea* be appo9t$ = a t]m ( #d ye>s2 & 7,b7 ! rema9+ #c vot+ memb]s %all ea* be appo9t$ = a t]m ( #b ye>s4 7#c7 ,date ( initial nom9ations ,! initial nom9ations = ! appo9tm5t ( all vot+ memb]s ( ! ,bo>d ( ,directors %all be made n lat] ?an #fj days aft] ! date ( enactm5t ( ?is ,act4 7#d7 ,beg9n+ ( t]m ,! t]m ( ea* ( ! initial vot+ memb]s appo9t$ "u ?is section %all comm5ce imm$iately ^u ! date ( appo9tm5t1 except t1 = purposes ( calculat+ ! t]m limits specifi$ 9 ?is subsection1 ! initial t]ms %all ea* be con/ru$ z beg9n+ on ,janu>y #bb ( ! ye> foll[+ ! date ( ! initial appo9tm5t4 7#e7 ,vacancies ,a vacancy 9 ! position ( a vot+ memb] ( ! ,bo>d ( ,directors %all be fill$ by ! ,presid5t1 & a memb] appo9t$ to fill a vacancy on ! ,bo>d ( ,directors occurr+ be=e ! expiration ( ! t]m = :i* ! pr$ecessor 0 appo9t$ %all be appo9t$ only = ! rema9d] ( t t]m4 7e7 ,meet+s 7#a7 ,op5 to ! public2 notice ,except z provid$ 9 p>agraph 7#c71 all meet+s ( ! ,bo>d ( ,directors %all be-- 7,a7 op5 to ! public2 & 7,b7 prec$$ by reasonable public notice4 7#b7 ,frequ5cy ,! ,bo>d ( ,directors %all meet n lat] ?an #fj days aft] ! date on :i* all memb]s ( ! ,bo>d ( ,directors are fir/ appo9t$1 at lea/ qu>t]ly !reaft]1 & o!rwise at ! call ( ei!r ! ,*airp]son or #e vot+ memb]s ( ! ,bo>d ( ,directors4 7#c7 ,exception = clos$ meet+s ,! vot+ memb]s ( ! ,bo>d ( ,directors may1 by majority vote1 close a meet+ to ! public if1 dur+ ! meet+ to be clos$1 !re is likely to be disclos$ propriet>y or s5sitive in=mation reg>d+ an infra/ructure project "u consid]ation = assi/ance "u ?is "p4 ,! ,bo>d ( ,directors %all prep>e m9utes ( any meet+ t is clos$ to ! public1 & %all make su* m9utes available z soon z practicable1 n lat] ?an #a ye> aft] ! date ( ! clos$ meet+1 ) any necess>y r$actions to protect any propriet>y or s5sitive in=mation4 7#d7 ,quorum ,= purposes ( meet+s ( ! ,bo>d ( ,directors1 #e vot+ memb]s ( ! ,bo>d ( ,directors %all con/itute a quorum4 7f7 ,comp5sation ( memb]s ,ea* vot+ memb] ( ! ,bo>d ( ,directors %all be comp5sat$ at a rate equal to ! daily equival5t ( ! annual rate ( basic pay prescrib$ = level ,,iii ( ! ,executive ,s*$ule "u section #ecad ( title #e1 ,unit$ ,/ates ,code1 = ea* day 7includ+ travel "t7 dur+ :i* ! memb] is engag$ 9 ! p]=mance ( ! duties ( ! ,bo>d ( ,directors4 7g7 ,conflicts ( int]e/ ,a vot+ memb] ( ! ,bo>d ( ,directors may n p>ticipate 9 any review or decision affect+ an infra/ructure project "u consid]ation = assi/ance "u ?is "p1 if ! memb] has or is affiliat$ ) an entity :o has a f9ancial int]e/ 9 su* project4 #gfg4 ,*ief executive (fic] ( ,,aifa 7a7 ,9 g5]al ,! *ief executive (fic] ( ,,aifa %all be a nonvot+ memb] ( ! ,bo>d ( ,directors1 :o %all be responsible = all activities ( ,,aifa1 & %all support ! ,bo>d ( ,directors z set =? 9 ?is "p & z ! ,bo>d ( ,directors deems necess>y or appropriate4 7b7 ,appo9tm5t & t5ure ( ! *ief executive (fic] 7#a7 ,9 g5]al ,! ,presid5t %all appo9t ! *ief executive (fic]1 by & ) ! advice & cons5t ( ! ,s5ate4 7#b7 ,t]m ,! *ief executive (fic] %all be appo9t$ = a t]m ( #f ye>s4 7#c7 ,vacancies ,any vacancy 9 ! (fice ( ! *ief executive (fic] %all be fill$ by ! ,presid5t1 & ! p]son appo9t$ to fill a vacancy 9 t position occurr+ be=e ! expiration ( ! t]m = :i* ! pr$ecessor 0 appo9t$ %all be appo9t$ only = ! rema9d] ( t t]m4 7c7 ,qualifications ,! *ief executive (fic]-- 7#a7 %all h significant exp]tise 9 managem5t & adm9i/ration ( a f9ancial in/itution1 or significant exp]tise 9 ! f9anc+ & developm5t ( infra/ructure projects1 or significant exp]tise 9 analyz+ ! economic b5efits ( infra/ructure inve/m5t2 & 7#b7 may n-- 7,a7 hold any o!r public (fice2 7,b7 h any f9ancial int]e/ 9 an infra/ructure project !n be+ consid]$ by ! ,bo>d ( ,directors1 unless t int]e/ is plac$ 9 a bl9d tru/2 or 7,c7 h any f9ancial int]e/ 9 an inve/m5t in/itution or its affiliates or any o!r entity seek+ or likely to seek f9ancial assi/ance = any infra/ructure project f ,,aifa1 unless any su* int]e/ is plac$ 9 a bl9d tru/ = ! t5ure ( ! s]vice ( ! *ief executive (fic] plus #b additional ye>s4 7d7 ,responsibilities ,! *ief executive (fic] %all h su* executive functions1 p[]s1 & duties z may be prescrib$ by ?is "p1 ! bylaws ( ,,aifa1 or ! ,bo>d ( ,directors1 includ+-- 7#a7 responsibility = ! developm5t & implem5tation ( ! /rategy ( ,,aifa1 includ+-- 7,a7 ! developm5t & submission to ! ,bo>d ( ,directors ( ! inve/m5t prospectus1 ! annual bus9ess plans & budget2 7,b7 ! developm5t & submission to ! ,bo>d ( ,directors ( a long-t]m /rategic plan2 & 7,c7 ! developm5t1 revision1 & submission to ! ,bo>d ( ,directors ( int]nal policies2 & 7#b7 responsibility = ! managem5t & ov]sight ( ! daily activities1 decisions1 op]ations1 & p]sonnel ( ,,aifa1 includ+-- 7,a7 ! appo9tm5t ( s5ior managem5t1 subject to approval by ! vot+ memb]s ( ! ,bo>d ( ,directors1 & ! hir+ & t]m9ation ( all o!r ,,aifa p]sonnel2 7,b7 reque/+ ! detail1 on a reimbursable basis1 ( p]sonnel f any ,f$]al ag5cy hav+ specific exp]tise n available f )9 ,,aifa1 foll[+ :i* reque/ ! head ( ! ,f$]al ag5cy may detail1 on a reimbursable basis1 any p]sonnel ( su* ag5cy reasonably reque/$ by ! *ief executive (fic]2 7,c7 assess+ & recomm5d+ 9 ! fir/ in/ance1 = ultimate approval or disapproval by ! ,bo>d ( ,directors1 comp5sation & adju/m5ts to comp5sation ( s5ior managem5t & o!r p]sonnel ( ,,aifa z may be necess>y = c>ry+ out ! functions ( ,,aifa2 7,d7 ensur+1 9 conjunction ) ! g5]al c\nsel ( ,,aifa1 t all activities ( ,,aifa are c>ri$ out 9 compliance ) applicable law2 7,e7 ov]see+ ! involvem5t ( ,,aifa 9 all projects1 includ+-- 7i7 develop+ eligible projects = ,,aifa f9ancial assi/ance2 7ii7 det]m9+ ! t]ms & conditions ( all f9ancial assi/ance packages2 7iii7 monitor+ all infra/ructure projects assi/$ by ,,aifa1 includ+ responsibility = ensur+ t ! proce$s ( any loan made1 gu>ante$1 or p>ticipat$ 9 are us$ only = ! purposes = :i* ! loan or gu>antee 0 made2 7iv7 prep>+ & submitt+ = approval by ! ,bo>d ( ,directors ! docum5ts requir$ "u p>agraph 7#a72 & 7v7 ensur+ ! implem5tation ( decisions ( ! ,bo>d ( ,directors2 & 7,f7 su* o!r activities z may be necess>y or appropriate 9 c>ry+ out ?is "p4 7e7 ,comp5sation 7#a7 ,9 g5]al ,any comp5sation assessm5t or recomm5dation by ! *ief executive (fic] "u ?is section %all be )\t reg>d to ! provisions ( *apt] #ea or sub*apt] ,,iii ( *apt] #ec ( title #e1 ,unit$ ,/ates ,code4 7#b7 ,consid]ations ,! comp5sation assessm5t or recomm5dation requir$ "u ?is subsection %all take into acc\nt m]it pr9ciples1 :]e applicable1 z well z ! education1 exp]i5ce1 level ( responsibility1 geographic diff]5ces1 & ret5tion & recruitm5t ne$s 9 det]m9+ comp5sation ( p]sonnel4 #gfh4 ,p[]s & duties ( ! ,bo>d ( ,directors ,! ,bo>d ( ,directors %all-- 7#a7 z soon z is practicable aft] ! date on :i* all memb]s are appo9t$1 approve or disapprove s5ior managem5t appo9t$ by ! *ief executive (fic]2 7#b7 n lat] ?an #ahj days aft] ! date on :i* all memb]s are appo9t$-- 7,a7 develop & approve ! bylaws ( ,,aifa1 includ+ bylaws = ! regulation ( ! affairs & conduct ( ! bus9ess ( ,,aifa1 consi/5t ) ! purpose1 goals1 objectives1 & policies set =? 9 ?is "p2 7,b7 e/abli% subcommittees1 includ+ an audit committee t is compos$ solely ( memb]s ( ! ,bo>d ( ,directors :o are indep5d5t ( ! s5ior managem5t ( ,,aifa2 7,c7 develop & approve1 9 consultation ) s5ior managem5t1 a conflict-(-int]e/ policy = ! ,bo>d ( ,directors & = s5ior managem5t2 7,d7 approve or disapprove int]nal policies t ! *ief executive (fic] %all submit to ! ,bo>d ( ,directors1 includ+-- 7i7 policies reg>d+ ! loan application & approval process1 includ+-- 7,i7 disclosure & application proc$ures to be foll[$ by entities 9 ! c\rse ( nom9at+ infra/ructure projects = assi/ance "u ?is "p2 7,,ii7 guidel9es = ! selection & approval ( projects2 7,,iii7 specific crit]ia = det]m9+ eligibility = project selection1 consi/5t ) title ,,ii2 & 7,,iv7 /&>diz$ t]ms & conditions1 fee s*$ules1 or legal requirem5ts ( a contract or program1 s z to c>ry out ?is "p2 & 7ii7 op]ational guidel9es2 & 7,e7 approve or disapprove a multi-ye> or #a-ye> bus9ess plan & budget = ,,aifa2 7#c7 ensure t ,,aifa is at all times op]at$ 9 a mann] t is consi/5t ) ?is "p1 by-- 7,a7 monitor+ & assess+ ! effectiv5ess ( ,,aifa 9 a*iev+ its /rategic goals2 7,b7 p]iodically review+ int]nal policies2 7,c7 review+ & approv+ annual bus9ess plans1 annual budgets1 & long-t]m /rategies submitt$ by ! *ief executive (fic]2 7,d7 review+ & approv+ annual reports submitt$ by ! *ief executive (fic]2 7,e7 engag+ "o or m ext]nal auditors1 z set =? 9 ?is "p2 & 7,f7 review+ & approv+ all *anges to ! organization ( s5ior managem5t2 7#d7 appo9t & fix1 by a vote ( #e ( ! #g vot+ memb]s ( ! ,bo>d ( ,directors1 & )\t reg>d to ! provisions ( *apt] #ea or sub*apt] ,,iii ( *apt] #ec ( title #e1 ,unit$ ,/ates ,code1 ! comp5sation & adju/m5ts to comp5sation ( all ,,aifa p]sonnel1 provid$ t 9 appo9t+ & fix+ any comp5sation or adju/m5ts to comp5sation "u ?is p>agraph1 ! ,bo>d %all-- 7,a7 consult )1 & seek to ma9ta9 comp>ability )1 o!r comp>able ,f$]al p]sonnel2 7,b7 consult ) ! ,(fice ( ,p]sonnel ,managem5t2 & 7,c7 c>ry out su* duties consi/5t ) m]it pr9ciples1 :]e applicable1 z well z ! education1 exp]i5ce1 level ( responsibility1 geographic diff]5ces1 & ret5tion & recruitm5t ne$s 9 det]m9+ comp5sation ( p]sonnel2 7#e7 e/abli% su* o!r crit]ia1 requirem5ts1 or proc$ures z ! ,bo>d ( ,directors may consid] to be appropriate 9 c>ry+ out ?is "p2 7#f7 s]ve z ! prim>y liaison = ,,aifa 9 int]actions ) ,congress1 ! ,executive ,bran*1 & ,/ate & local gov]nm5ts1 & to repres5t ! int]e/s ( ,,aifa 9 su* int]actions & o!rs2 7#g7 approve by a vote ( #e ( ! #g vot+ memb]s ( ! ,bo>d ( ,directors any *anges to ! bylaws or int]nal policies ( ,,aifa2 7#h7 h ! au?ority & responsibility-- 7,a7 to ov]see ent]+ into & c>ry out su* contracts1 leases1 coop]ative agreem5ts1 or o!r transactions z are necess>y to c>ry out ?is "p )-- 7i7 any ,f$]al dep>tm5t or ag5cy2 7ii7 any ,/ate1 t]ritory1 or possession 7or any political subdivision !re(1 includ+ ,/ate infra/ructure banks7 ( ! ,unit$ ,/ates2 & 7iii7 any individual1 public-private p>tn]%ip1 firm1 association1 or corporation2 7,b7 to approve ( ! acquisition1 lease1 pl$ge1 ex*ange1 & disposal ( real & p]sonal prop]ty by ,,aifa & o!rwise approve ! ex]cise by ,,aifa ( all ( ! usual incid5ts ( own]%ip ( prop]ty1 to ! ext5t t ! ex]cise ( su* p[]s is appropriate to & consi/5t ) ! purposes ( ,,aifa2 7,c7 to det]m9e ! "* (1 & ! necessity =1 ! obligations & exp5ditures ( ,,aifa1 & ! mann] 9 :i* ! obligations & exp5ditures w be incurr$1 all[$1 & paid1 subject to ?is "p & o!r ,f$]al law specifically applicable to :olly own$ ,f$]al corporations2 7,d7 to execute1 9 accordance ) applicable bylaws & regulations1 appropriate in/rum5ts2 7,e7 to approve o!r =ms ( cr$it enhancem5t t ,,aifa may provide to eligible projects1 z long z ! =ms ( cr$it enhancem5ts are consi/5t ) ! purposes ( ?is "p & t]ms set =? 9 title ,,ii2 7,f7 to ex]cise all o!r lawful p[]s :i* are necess>y or appropriate to c>ry out1 & are consi/5t )1 ! purposes ( ,,aifa2 7,g7 to sue or be su$ 9 ! corporate capacity ( ,,aifa 9 any c\rt ( compet5t jurisdiction2 7,h7 to indemnify ! memb]s ( ! ,bo>d ( ,directors & (fic]s ( ,,aifa = any liabilities aris+ out ( ! actions ( ! memb]s & (fic]s 9 su* capacity1 9 accordance )1 & subject to ! limitations conta9$ 9 ?is "p2 7,i7 to review all f9ancial assi/ance packages to all eligible infra/ructure projects1 z submitt$ by ! *ief executive (fic] & to approve1 po/pone1 or d5y ! same by majority vote2 7,j7 to review all re/ructur+ proposals submitt$ by ! *ief executive (fic]1 includ+ assignation1 pl$g+1 or disposal ( ! int]e/ ( ,,aifa 9 a project1 includ+ paym5t or income f any int]e/ own$ or held by ,,aifa1 & to approve1 po/pone1 or d5y ! same by majority vote2 & 7,k7 to ent] into b9d+ commitm5ts1 z specifi$ 9 approv$ f9ancial assi/ance packages2 7#i7 delegate to ! *ief executive (fic] ^? duties t ! ,bo>d ( ,directors deems appropriate1 to bett] c>ry out ! p[]s & purposes ( ! ,bo>d ( ,directors "u ?is section2 & 7#aj7 to approve a maximum aggregate am\nt ( out/&+ obligations ( ,,aifa at any giv5 "t1 tak+ into consid]ation fund+1 & ! size ( ,,aifa's addressable m>ket = infra/ructure projects4 #gfi4 ,s5ior managem5t 7a7 ,9 g5]al ,s5ior managem5t %all support ! *ief executive (fic] 9 ! dis*>ge ( ! responsibilities ( ! *ief executive (fic]4 7b7 ,appo9tm5t ( s5ior managem5t ,! *ief executive (fic] %all appo9t su* s5ior manag]s z are necess>y to c>ry out ! purpose ( ,,aifa1 z approv$ by a majority vote ( ! vot+ memb]s ( ! ,bo>d ( ,directors4 7c7 ,t]m ,ea* memb] ( s5ior managem5t %all s]ve at ! pleasure ( ! *ief executive (fic] & ! ,bo>d ( ,directors4 7d7 ,removal ( s5ior managem5t ,any memb] ( s5ior managem5t may be remov$1 ei!r by a majority ( ! vot+ memb]s ( ! ,bo>d ( ,directors ^u reque/ by ! *ief executive (fic]1 or o!rwise by vote ( n few] ?an #e vot+ memb]s ( ! ,bo>d ( ,directors4 7e7 ,s5ior managem5t 7#a7 ,9 g5]al ,ea* memb] ( s5ior managem5t %all report directly to ! *ief executive (fic]1 o!r ?an ! ,*ief ,risk ,(fic]1 :o %all report directly to ! ,bo>d ( ,directors4 7#b7 ,duties & responsibilities 7,a7 ,*ief f9ancial (fic] ,! ,*ief ,f9ancial ,(fic] %all be responsible = all f9ancial functions ( ,,aifa1 provid$ t1 at ! discretion ( ! ,bo>d ( ,directors1 specific functions ( ! ,*ief ,f9ancial ,(fic] may be delegat$ ext]nally4 7,b7 ,*ief risk (fic] ,! ,*ief ,risk ,(fic] %all be responsible = all functions ( ,,aifa relat+ to-- 7i7 ! creation ( f9ancial1 cr$it1 & op]ational risk managem5t guidel9es & policies2 7ii7 cr$it analysis = infra/ructure projects2 7iii7 ! creation ( con=m+ /&>ds = infra/ructure f9ance agreem5ts2 7iv7 ! monitor+ ( ! f9ancial1 cr$it1 & op]ational exposure ( ,,aifa2 & 7v7 risk managem5t & mitigation actions1 includ+ by report+ su* actions1 or recomm5dations ( su* actions to be tak51 directly to ! ,bo>d ( ,directors4 7,c7 ,*ief compliance (fic] ,! ,*ief ,compliance ,(fic] %all be responsible = all functions ( ,,aifa relat+ to int]nal audits1 acc\nt+ safegu>ds1 & ! en=cem5t ( su* safegu>ds & o!r applicable requirem5ts4 7,d7 ,g5]al c\nsel ,! ,g5]al ,c\nsel %all be responsible = all functions ( ,,aifa relat+ to legal matt]s &1 9 consultation ) ! *ief executive (fic]1 %all be responsible = ensur+ t ,,aifa complies ) all applicable law4 7,e7 ,*ief op]ations (fic] ,! ,*ief ,op]ations ,(fic] %all be responsible = all op]ational functions ( ,,aifa1 includ+ ^? relat+ to ! cont9u+ op]ations & p]=mance ( all infra/ructure projects 9 :i* ,,aifa reta9s an int]e/ & = all ,,aifa functions relat$ to human res\rces4 7,f7 ,*ief l5d+ (fic] ,! ,*ief ,l5d+ ,(fic] %all be responsible =-- 7i7 all functions ( ,,aifa relat+ to ! developm5t ( project pipel9e1 f9ancial /ructur+ ( projects1 selection ( infra/ructure projects to be review$ by ! ,bo>d ( ,directors1 prep>ation ( infra/ructure projects to be pres5t$ to ! ,bo>d ( ,directors1 & set aside = rural infra/ructure projects2 7ii7 ! creation & managem5t (-- 7,i7 a ,c5t] = ,excell5ce to provide te*nical assi/ance to public sector borr[]s 9 ! developm5t & f9anc+ ( infra/ructure projects2 & 7,,ii7 an ,(fice ( ,rural ,assi/ance to provide te*nical assi/ance 9 ! developm5t & f9anc+ ( rural infra/ructure projects2 & 7iii7 ! e/abli%m5t ( guidel9es to ensure div]sification ( l5d+ activities by region1 infra/ructure project type1 & project size4 7f7 ,*anges to s5ior managem5t ,! ,bo>d ( ,directors1 9 consultation ) ! *ief executive (fic]1 may alt] ! /ructure ( ! s5ior managem5t ( ,,aifa at any "t to bett] accompli% ! goals1 objectives1 & purposes ( ,,aifa1 provid$ t ! functions ( ! ,*ief ,f9ancial ,(fic] set =? 9 subsection 7e7 rema9 sep>ate f ! functions ( ! ,*ief ,risk ,(fic] set =? 9 subsection 7e74 7g7 ,conflicts ( int]e/ ,no individual appo9t$ to s5ior managem5t may-- 7#a7 hold any o!r public (fice2 7#b7 h any f9ancial int]e/ 9 an infra/ructure project !n be+ consid]$ by ! ,bo>d ( ,directors1 unless t int]e/ is plac$ 9 a bl9d tru/2 or 7#c7 h any f9ancial int]e/ 9 an inve/m5t in/itution or its affiliates1 ,,aifa or its affiliates1 or o!r entity !n seek+ or likely to seek f9ancial assi/ance = any infra/ructure project f ,,aifa1 unless any su* int]e/ is plac$ 9 a bl9d tru/ dur+ ! t]m ( s]vice ( t individual 9 a s5ior managem5t position1 & = a p]iod ( #b ye>s !reaft]4 #ggj4 ,special ,inspector ,g5]al = ,,aifa 7a7 ,9 g5]al ,dur+ ! fir/ #e op]at+ ye>s ( ,,aifa1 ! ,(fice ( ! ,inspector ,g5]al ( ! ,dep>tm5t ( ! ,treasury %all h responsibility = ,,aifa4 7b7 ,(fice ( ! special inspector g5]al ,effective #e ye>s aft] ! date ( enactm5t ( ! comm5cem5t ( ! op]ations ( ,,aifa1 !re is e/abli%$ ! ,(fice ( ! ,special ,inspector ,g5]al = ,,aifa4 7c7 ,appo9tm5t ( ,inspector ,g5]al2 ,removal 7#a7 ,head ( (fice ,! head ( ! ,(fice ( ! ,special ,inspector ,g5]al = ,,aifa %all be ! ,special ,inspector ,g5]al = ,,aifa 79 ?is "p ref]r$ to z ! ,special ,inspector ,g5]al71 :o %all be appo9t$ by ! ,presid5t1 by & ) ! advice & cons5t ( ! ,s5ate4 7#b7 ,basis ( appo9tm5t ,! appo9tm5t ( ! ,special ,inspector ,g5]al %all be made on ! basis ( integrity & demon/rat$ ability 9 acc\nt+1 audit+1 f9ancial analysis1 law1 managem5t analysis1 public adm9i/ration1 or inve/igations4 7#c7 ,tim+ ( nom9ation ,! nom9ation ( an individual z ,special ,inspector ,g5]al %all be made z soon z is practicable aft] ! effective date "u subsection 7b74 7#d7 ,removal ,! ,special ,inspector ,g5]al %all be removable f (fice 9 accordance ) ! provisions ( section #c7;b7 ( ! ,inspector ,g5]al ,act ( #aigh 7#e ,u4,s4,c4 ,app474 7#e7 ,rule ( con/ruction ,= purposes ( section #gcbd ( title #e1 ,unit$ ,/ates ,code1 ! ,special ,inspector ,g5]al %all n be consid]$ an employee :o det]m9es policies to be pursu$ by ! ,unit$ ,/ates 9 ! nationwide adm9i/ration ( ,f$]al law4 7#f7 ,rate ( pay ,! annual rate ( basic pay ( ! ,special ,inspector ,g5]al %all be ! annual rate ( basic pay = an ,inspector ,g5]al "u section #c7;e7 ( ! ,inspector ,g5]al ,act ( #aigh 7#e ,u4,s4,c4 ,app474 7d7 ,duties 7#a7 ,9 g5]al ,x %all be ! duty ( ! ,special ,inspector ,g5]al to conduct1 sup]vise1 & coord9ate audits & inve/igations ( ! bus9ess activities ( ,,aifa4 7#b7 ,o!r sy/ems1 proc$ures1 & controls ,! ,special ,inspector ,g5]al %all e/abli%1 ma9ta91 & ov]see su* sy/ems1 proc$ures1 & controls z ! ,special ,inspector ,g5]al consid]s appropriate to dis*>ge ! duty "u p>agraph 7#a74 7#c7 ,additional duties ,9 addition to ! duties specifi$ 9 p>agraphs 7#a7 & 7#b71 ! ,inspector ,g5]al %all also h ! duties & responsibilities ( inspectors g5]al "u ! ,inspector ,g5]al ,act ( #aigh4 7e7 ,p[]s & au?orities 7#a7 ,9 g5]al ,9 c>ry+ out ! duties specifi$ 9 subsection 7c71 ! ,special ,inspector ,g5]al %all h ! au?orities provid$ 9 section #f ( ! ,inspector ,g5]al ,act ( #aigh4 7#b7 ,additional au?ority ,! ,special ,inspector ,g5]al %all c>ry out ! duties specifi$ 9 subsection 7c77#a7 9 accordance ) section #d7;b77#a7 ( ! ,inspector ,g5]al ,act ( #aigh4 7f7 ,p]sonnel1 facilities1 & o!r res\rces 7#a7 ,additional (fic]s 7,a7 ,! ,special ,inspector ,g5]al may select1 appo9t1 & employ su* (fic]s & employees z may be necess>y = c>ry+ out ! duties ( ! ,special ,inspector ,g5]al1 subject to ! provisions ( title #e1 ,unit$ ,/ates ,code1 gov]n+ appo9tm5ts 9 ! competitive s]vice1 & ! provisions ( *apt] #ea & sub*apt] ,,iii ( *apt] #ec ( su* title1 relat+ to classification & ,g5]al ,s*$ule pay rates4 7,b7 ,! ,special ,inspector ,g5]al may ex]cise ! au?orities ( subsections 7b7 ?r\gh 7i7 ( section #cafa ( title #e1 ,unit$ ,/ates ,code 7)\t reg>d to subsection 7a7 ( t section74 7#b7 ,ret5tion ( s]vices ,! ,special ,inspector ,g5]al may obta9 s]vices z au?oriz$ by section #caji ( title #e1 ,unit$ ,/ates ,code1 at daily rates n to exce$ ! equival5t rate prescrib$ = grade ,,gs-#ae ( ! ,g5]al ,s*$ule by section #eccb ( su* title4 7#c7 ,ability to contract = audits1 /udies1 & o!r s]vices ,! ,special ,inspector ,g5]al may ent] into contracts & o!r arrangem5ts = audits1 /udies1 analyses1 & o!r s]vices ) public ag5cies & ) private p]sons1 & make su* paym5ts z may be necess>y to c>ry out ! duties ( ! ,special ,inspector ,g5]al4 7#d7 ,reque/ = in=mation 7,a7 ,9 g5]al ,^u reque/ ( ! ,special ,inspector ,g5]al = in=mation or assi/ance f any dep>tm5t1 ag5cy1 or o!r entity ( ! ,f$]al ,gov]nm5t1 ! head ( su* entity %all1 ins(> z is practicable & n 9 contrav5tion ( any exi/+ law1 furni% su* in=mation or assi/ance to ! ,special ,inspector ,g5]al1 or an au?oriz$ designee4 7,b7 ,refusal to comply ,:5ev] in=mation or assi/ance reque/$ by ! ,special ,inspector ,g5]al is1 9 ! judgm5t ( ! ,special ,inspector ,g5]al1 unreasonably refus$ or n provid$1 ! ,special ,inspector ,g5]al %all report ! circum/ances to ! ,secret>y ( ! ,treasury1 )\t delay4 7g7 ,reports 7#a7 ,annual report ,n lat] ?an #a ye> aft] ! confirmation ( ! ,special ,inspector ,g5]al1 & e cal5d> ye> !reaft]1 ! ,special ,inspector ,g5]al %all submit to ! ,presid5t a report summ>iz+ ! activities ( ! ,special ,inspector ,g5]al dur+ ! previ\s #a-ye> p]iod end+ on ! date ( su* report4 7#b7 ,public disclosures ,no?+ 9 ?is subsection %all be con/ru$ to au?orize ! public disclosure ( in=mation t is-- 7,a7 specifically prohibit$ f disclosure by any o!r provision ( law2 7,b7 specifically requir$ by ,executive ord] to be protect$ f disclosure 9 ! int]e/ ( national def5se or national security or 9 ! conduct ( =eign affairs2 or 7,c7 a "p ( an ongo+ crim9al inve/igation4 #gga4 ,o!r p]sonnel ,except z o!rwise provid$ 9 ! bylaws ( ,,aifa1 ! *ief executive (fic]1 9 consultation ) ! ,bo>d ( ,directors1 %all appo9t1 remove1 & def9e ! duties ( su* qualifi$ p]sonnel z are necess>y to c>ry out ! p[]s1 duties1 & purpose ( ,,aifa1 o!r ?an s5ior managem5t1 :o %all be appo9t$ 9 accordance ) section #gfi4 #ggb4 ,compliance ,! provision ( assi/ance by ! ,bo>d ( ,directors pursuant to ?is "p %all n be con/ru$ z sup]s$+ any provision ( ,/ate law or regulation o!rwise applicable to an infra/ructure project4 ,c ,t]ms & limitations on direct loans & loan gu>antees #ggc4 ,eligibility crit]ia = assi/ance f ,,aifa & t]ms & limitations ( loans 7a7 ,9 g5]al ,any project ^: use or purpose is private & = :i* no public b5efit is creat$ %all n be eligible = f9ancial assi/ance f ,,aifa "u ?is "p4 ,f9ancial assi/ance "u ?is "p %all only be made available if ! applicant = su* assi/ance has demon/rat$ to ! satisfaction ( ! ,bo>d ( ,directors t ! infra/ructure project = :i* su* assi/ance is be+ s\ght-- 7#a7 is n = ! ref9anc+ ( an exi/+ infra/ructure project2 & 7#b7 meets-- 7,a7 any p]t95t requirem5ts set =? 9 ?is "p2 7,b7 any crit]ia e/abli%$ by ! ,bo>d ( ,directors or *ief executive (fic] 9 accordance ) ?is "p2 & 7,c7 ! def9ition ( a transportation infra/ructure project1 wat] infra/ructure project1 or en]gy infra/ructure project4 7b7 ,consid]ations ,! crit]ia e/abli%$ by ! ,bo>d ( ,directors pursuant to ?is "p %all provide adequate consid]ation (-- 7#a7 ! economic1 f9ancial1 te*nical1 environm5tal1 & public b5efits & co/s ( ea* infra/ructure project "u consid]ation = f9ancial assi/ance "u ?is "p1 prioritiz+ infra/ructure projects t-- 7,a7 contribute to regional or national economic gr[?2 7,b7 (f] value = money to taxpay]s2 7,c7 demon/rate a cle> & significant public b5efit2 7,d7 lead to job creation2 & 7,e7 mitigate environm5tal conc]ns2 7#b7 ! means by :i* developm5t ( ! infra/ructure project "u consid]ation is be+ f9anc$1 includ+-- 7,a7 ! t]ms1 conditions1 & /ructure ( ! propos$ f9anc+2 7,b7 ! cr$it wor?9ess & /&+ ( ! project sponsors1 provid]s ( equity1 & c(9anci]s2 7,c7 ! f9ancial assumptions & projections on :i* ! infra/ructure project is bas$2 & 7,d7 :e!r !re is suffici5t ,/ate or municipal political support = ! successful completion ( ! infra/ructure project2 7#c7 ! likelihood t ! provision ( assi/ance by ,,aifa w cause su* developm5t to proce$ m promptly & ) l[] co/s ?an w\ld be ! case )\t su* assi/ance2 7#d7 ! ext5t to :i* ! provision ( assi/ance by ,,aifa maximizes ! level ( private inve/m5t 9 ! infra/ructure project or supports a public-private p>tn]%ip1 :ile provid+ a significant public b5efit2 7#e7 ! ext5t to :i* ! provision ( assi/ance by ,,aifa c mobilize ! p>ticipation ( o!r f9anc+ p>tn]s 9 ! infra/ructure project2 7#f7 ! te*nical & op]ational viability ( ! infra/ructure project2 7#g7 ! proportion ( f9ancial assi/ance f ,,aifa2 7#h7 ! geographic location ( ! project 9 an ef=t to h geographic div]sity ( projects fund$ by ,,aifa2 7#i7 ! size ( ! project & its impact on ! res\rces ( ,,aifa2 7#aj7 ! infra/ructure sector ( ! project1 9 an ef=t to h projects f m ?an "o sector fund$ by ,,aifa2 & 7#aa7 enc\rages use ( innovative procurem5t1 asset managem5t1 or f9anc+ to m9imize ! all-9-life-cycle co/1 & improve ! co/-effectiv5ess ( a project4 7c7 ,application 7#a7 ,9 g5]al ,any eligible entity seek+ assi/ance f ,,aifa "u ?is "p = an eligible infra/ructure project %all submit an application to ,,aifa at su* "t1 9 su* mann]1 & conta9+ su* in=mation z ! ,bo>d ( ,directors or ! *ief executive (fic] may require4 7#b7 ,review ( applications ,,aifa %all review applications = assi/ance "u ?is "p on an ongo+ basis4 ,! *ief executive (fic]1 work+ ) ! s5ior managem5t1 %all prep>e eligible infra/ructure projects = review & approval by ! ,bo>d ( ,directors4 7#c7 ,d$icat$ rev5ue s\rces ,! ,f$]al cr$it in/rum5t %all be repayable1 9 :ole or 9 "p1 f tolls1 us] fees1 or o!r d$icat$ rev5ue s\rces t also secure ! infra/ructure project obligations4 7d7 ,eligible infra/ructure project co/s 7#a7 ,9 g5]al ,except z provid$ 9 p>agraph 7#b71 to be eligible = assi/ance "u ?is "p1 an infra/ructure project %all h project co/s t are reasonably anticipat$ to equal or exce$ #ajj1jjj1jjj4 7#b7 ,rural infra/ructure projects ,to be eligible = assi/ance "u ?is "p a rural infra/ructure project %all h project co/s t are reasonably anticipat$ to equal or exce$ #be1jjj1jjj4 7e7 ,loan eligibility & maximum am\nts 7#a7 ,9 g5]al ,! am\nt ( a direct loan or loan gu>antee "u ?is "p %all n exce$ ! less] ( #ej p]c5t ( ! reasonably anticipat$ eligible infra/ructure project co/s or1 if ! direct loan or loan gu>antee does n receive an inve/m5t grade rat+1 ! am\nt ( ! s5ior project obligations4 7#b7 ,maximum annual loan & loan gu>antee volume ,! aggregate am\nt ( direct loans & loan gu>antees made by ,,aifa 9 any s+le fiscal ye> may n exce$-- 7,a7 dur+ ! fir/ #b fiscal ye>s ( ! op]ations ( ,,aifa1 #aj1jjj1jjj1jjj2 7,b7 dur+ fiscal ye>s #c ?r\gh #i ( ! op]ations ( ,,aifa1 #bj1jjj1jjj1jjj2 or 7,c7 dur+ any fiscal ye> !reaft]1 #ej1jjj1jjj1jjj4 7f7 ,/ate & local p]mits requir$ ,! provision ( assi/ance by ! ,bo>d ( ,directors pursuant to ?is "p %all n be deem$ to relieve any recipi5t ( su* assi/ance1 or ! relat$ infra/ructure project1 ( any obligation to obta9 requir$ ,/ate & local p]mits & approvals4 #ggd4 ,loan t]ms & repaym5t 7a7 ,9 g5]al ,a direct loan or loan gu>antee "u ?is "p ) respect to an eligible infra/ructure project %all be on su* t]ms1 subject to su* conditions1 & conta9 su* cov5ants1 repres5tations1 w>ranties1 & requirem5ts 7includ+ requirem5ts = audits7 z ! *ief executive (fic] det]m9es appropriate4 7b7 ,t]ms ,a direct loan or loan gu>antee "u ?is "p-- 7#a7 %all-- 7,a7 be payable1 9 :ole or 9 "p1 f tolls1 us] fees1 or o!r d$icat$ rev5ue s\rces t also secure ! s5ior project obligations 7su* z availability paym5ts & d$icat$ ,/ate or local rev5ues72 & 7,b7 include a rate cov5ant1 cov]age requirem5t1 or simil> security feature support+ ! project obligations2 & 7#b7 may h a li5 on rev5ues describ$ 9 p>agraph 7#a71 subject to any li5 secur+ project obligations4 7c7 ,base int]e/ rate ,! base int]e/ rate on a direct loan "u ?is "p %all be n less ?an ! yield on ,unit$ ,/ates ,treasury obligations ( a simil> maturity to ! maturity ( ! direct loan4 7d7 ,risk assessm5t ,be=e ent]+ into an agreem5t = assi/ance "u ?is "p1 ! *ief executive (fic]1 9 consultation ) ! ,director ( ! ,(fice ( ,managem5t & ,budget & consid]+ rat+ ag5cy prelim9>y or f9al rat+ op9ion lett]s ( ! project "u ?is section1 %all e/imate an appropriate ,f$]al cr$it subsidy am\nt = ea* direct loan & loan gu>antee1 tak+ into acc\nt su* lett]1 z well z any comp>able m>ket rates available = su* a loan or loan gu>antee1 %\ld any exi/4 ,! f9al cr$it subsidy co/ = ea* loan & loan gu>antee %all be det]m9$ consi/5t ) ! ,f$]al ,cr$it ,re=m ,act1 #b ,u4,s4,c4 #ffa;a et seq4 7e7 ,cr$it fee ,) respect to ea* agreem5t = assi/ance "u ?is "p1 ! *ief executive (fic] may *>ge a cr$it fee to ! recipi5t ( su* assi/ance to pay =1 ov] "t1 all or a portion ( ! ,f$]al cr$it subsidy det]m9$ "u subsection 7d71 ) ! rema9d] paid by ! acc\nt e/abli%$ = ,,aifa2 provid$1 t ! s\rce ( fees paid "u ?is section %all n be a loan or debt obligation gu>ante$ by ! ,f$]al ,gov]nm5t4 ,9 ! case ( a direct loan1 su* cr$it fee %all be 9 addition to ! base int]e/ rate e/abli%$ "u subsection 7c74 7f7 ,maturity date ,! f9al maturity date ( a direct loan or loan gu>ante$ by ,,aifa "u ?is "p %all be n lat] ?an #ce ye>s aft] ! date ( sub/antial completion ( ! infra/ructure project1 z det]m9$ by ! *ief executive (fic]4 7g7 ,rat+ op9ion lett] 7#a7 ,9 g5]al ,! *ief executive (fic] %all require ea* applicant = assi/ance "u ?is "p to provide a rat+ op9ion lett] f at lea/ #a rat+s ag5cy1 indicat+ t ! s5ior obligations ( ! infra/ructure project1 :i* may be ! ,f$]al cr$it in/rum5t1 h ! pot5tial to a*ieve an inve/m5t-grade rat+4 7#b7 ,rural infra/ructure projects ,) respect to a rural infra/ructure project1 a rat+ ag5cy op9ion lett] describ$ 9 p>agraph 7#a7 %all n be requir$1 except t ! loan or loan gu>antee %all receive an int]nal rat+ score1 us+ me?ods simil> to ! rat+s ag5cies g5]at$ by ,,aifa1 measur+ ! propos$ direct loan or loan gu>antee aga9/ comp>able direct loans or loan gu>antees ( simil> cr$it quality 9 a simil> sector4 7h7 ,inve/m5t-,grade rat+ requirem5t 7#a7 ,loans & loan gu>antees ,! execution ( a direct loan or loan gu>antee "u ?is "p %all be cont+5t on ! s5ior obligations ( ! infra/ructure project receiv+ an inve/m5t-grade rat+4 7#b7 ,rat+ ( aifa ov]all portfolio ,! av]age rat+ ( ! ov]all portfolio ( ,,aifa %all be n less ?an inve/m5t grade aft] #e ye>s ( op]ation4 7i7 ,t]ms & repaym5t ( direct loans 7#a7 ,s*$ule ,! *ief executive (fic] %all e/abli% a repaym5t s*$ule = ea* direct loan "u ?is "p1 bas$ on ! project$ ca% fl[ f infra/ructure project rev5ues & o!r repaym5t s\rces4 7#b7 ,comm5cem5t ,s*$ul$ loan repaym5ts ( pr9cipal or int]e/ on a direct loan "u ?is "p %all comm5ce n lat] ?an #e ye>s aft] ! date ( sub/antial completion ( ! infra/ructure project1 z det]m9$ by ! *ief executive (fic] ( ,,aifa4 7#c7 ,def]r$ paym5ts ( direct loans 7,a7 ,au?orization ,if1 at any "t aft] ! date ( sub/antial completion ( an infra/ructure project assi/$ "u ?is "p1 ! infra/ructure project is unable to g5]ate suffici5t rev5ues to pay ! s*$ul$ loan repaym5ts ( pr9cipal & int]e/ on ! direct loan "u ?is "p1 ! *ief executive (fic] may all[ ! obligor to add unpaid pr9cipal & int]e/ to ! out/&+ balance ( ! direct loan1 if ! result w\ld b5efit ! taxpay]4 7,b7 ,int]e/ ,any paym5t def]r$ "u subp>agraph 7,a7 %all-- 7i7 cont9ue to accrue int]e/1 9 accordance ) ! t]ms ( ! obligation1 until fully repaid2 & 7ii7 be s*$ul$ to be amortiz$ ov] ! rema9+ t]m ( ! loan4 7,c7 ,crit]ia 7i7 ,9 g5]al ,any paym5t def]ral "u subp>agraph 7,a7 %all be cont+5t on ! infra/ructure project meet+ crit]ia e/abli%$ by ! ,bo>d ( ,directors4 7ii7 ,repaym5t /&>ds ,! crit]ia e/abli%$ "u clause 7i7 %all include /&>ds = reasonable assurance ( repaym5t4 7#d7 ,prepaym5t ( direct loans 7,a7 ,use ( excess rev5ues ,any excess rev5ues t rema9 aft] satisfy+ s*$ul$ debt s]vice requirem5ts on ! infra/ructure project obligations & direct loan & all deposit requirem5ts "u ! t]ms ( any tru/ agreem5t1 bond resolution1 or simil> agreem5t secur+ project obligations "u ?is "p may be appli$ annually to prepay ! direct loan1 )\t p5alty4 7,b7 ,use ( proce$s ( ref9anc+ ,a direct loan "u ?is "p may be prepaid at any "t1 )\t p5alty1 f ! proce$s ( ref9anc+ f non-,f$]al fund+ s\rces4 7#e7 ,sale ( direct loans 7,a7 ,9 g5]al ,z soon z is practicable aft] sub/antial completion ( an infra/ructure project assi/$ "u ?is "p1 & aft] notify+ ! obligor1 ! *ief executive (fic] may sell to ano!r entity1 or re(f] into ! capital m>kets1 a direct loan = ! infra/ructure project1 if ! *ief executive (fic] det]m9es t ! sale or re(f]+ c be made on favorable t]ms = ! taxpay]4 7,b7 ,cons5t ( obligor ,9 mak+ a sale or re(f]+ "u subp>agraph 7,a71 ! *ief executive (fic] may n *ange ! orig9al t]ms & conditions ( ! direct loan1 )\t ! writt5 cons5t ( ! obligor4 7j7 ,loan gu>antees 7#a7 ,t]ms ,! t]ms ( a loan gu>ante$ by ,,aifa "u ?is "p %all be consi/5t ) ! t]ms set =? 9 ?is section = a direct loan1 except t ! rate on ! gu>ante$ loan & any paym5t1 pre-paym5t1 or ref9anc+ features %all be negotiat$ betwe5 ! obligor & ! l5d]1 ) ! cons5t ( ! *ief executive (fic]4 7#b7 ,gu>ante$ l5d] ,a gu>ante$ l5d] %all be limit$ to ^? l5d]s meet+ ! def9ition ( t t]m 9 section #fja7;a7 ( title #bc1 ,unit$ ,/ates ,code4 7k7 ,compliance ) ,,fcra2 9 g5]al ,direct loans & loan gu>antees au?oriz$ by ?is "p %all be subject to ! provisions ( ! ,f$]al ,cr$it ,re=m ,act ( #aiij 7#b ,u4,s4,c4 #ffa et seq471 z am5d$4 #gge4 ,compliance & en=cem5t 7a7 ,cr$it agreem5t ,not)/&+ any o!r provision ( law1 ea* eligible entity t receives assi/ance "u ?is "p f ,,aifa %all ent] into a cr$it agreem5t t requires su* entity to comply ) all applicable policies & proc$ures ( ,,aifa1 9 addition to all o!r provisions ( ! loan agreem5t4 7b7 ,,aifa au?ority on noncompliance ,9 any case 9 :i* a recipi5t ( assi/ance "u ?is "p is mat]ially out ( compliance ) ! loan agreem5t1 or any applicable policy or proc$ure ( ,,aifa1 ! ,bo>d ( ,directors may take action to cancel unutiliz$ loan am\nts1 or to accel]ate ! repaym5t t]ms ( any out/&+ obligation4 7c7 ,no?+ 9 ?is "p is int5d$ to affect exi/+ provisions ( law applicable to ! plann+1 developm5t1 con/ruction1 or op]ation ( projects fund$ "u ! ,act4 #ggf4 ,audits2 reports to ! ,presid5t & ,congress 7a7 ,acc\nt+ ,! books ( acc\nt ( ,,aifa %all be ma9ta9$ 9 accordance ) g5]ally accept$ acc\nt+ pr9ciples1 & %all be subject to an annual audit by indep5d5t public acc\ntants ( nationally recogniz$ /&+ appo9t$ by ! ,bo>d ( ,directors4 7b7 ,reports 7#a7 ,bo>d ( directors ,n lat] ?an #ij days aft] ! la/ day ( ea* fiscal ye>1 ! ,bo>d ( ,directors %all submit to ! ,presid5t & ,congress a complete & detail$ report ) respect to ! prec$+ fiscal ye>1 sett+ =?-- 7,a7 a summ>y ( ! op]ations ( ,,aifa1 = su* fiscal ye>2 7,b7 a s*$ule ( ! obligations ( ,,aifa & capital securities out/&+ at ! end ( su* fiscal ye>1 ) a /atem5t ( ! am\nts issu$ & r$eem$ or paid dur+ su* fiscal ye>2 7,c7 ! /atus ( infra/ructure projects receiv+ fund+ or o!r assi/ance pursuant to ?is "p dur+ su* fiscal ye>1 includ+ all nonp]=m+ loans1 & includ+ disclosure ( all entities ) a developm5t1 own]%ip1 or op]ational int]e/ 9 su* infra/ructure projects2 7,d7 a description ( ! successes & *all5ges enc\nt]$ 9 l5d+ to rural communities1 includ+ ! role ( ! ,c5t] = ,excell5ce & ! ,(fice ( ,rural ,assi/ance e/abli%$ "u ?is "p2 & 7,e7 an assessm5t ( ! risks ( ! portfolio ( ,,aifa1 prep>$ by an indep5d5t s\rce4 7#b7 ,,gao ,n lat] ?an #e ye>s aft] ! date ( enactm5t ( ?is "p1 ! ,comptroll] ,g5]al ( ! ,unit$ ,/ates %all conduct an evaluation (1 & %all submit to ,congress a report on1 activities ( ,,aifa = ! fiscal ye>s cov]$ by ! report t includes an assessm5t ( ! impact & b5efits ( ea* fund$ infra/ructure project1 includ+ a review ( h[ effectively ea* su* infra/ructure project accompli%$ ! goals prioritiz$ by ! infra/ructure project crit]ia ( ,,aifa4 7c7 ,books & records 7#a7 ,9 g5]al ,,aifa %all ma9ta9 adequate books & records to support ! f9ancial transactions ( ,,aifa1 ) a description ( f9ancial transactions & infra/ructure projects receiv+ fund+1 & ! am\nt ( fund+ = ea* su* project ma9ta9$ on a publically accessible database4 7#b7 ,audits by ! ,secret>y & ,,gao ,! books & records ( ,,aifa %all at all times be op5 to inspection by ! ,secret>y ( ! ,treasury1 ! ,special ,inspector ,g5]al1 & ! ,comptroll] ,g5]al ( ! ,unit$ ,/ates4 ,d ,fund+ ( ,,aifa #ggg4 ,adm9i/rative fees 7a7 ,9 g5]al ,9 addition to fees t may be collect$ "u section #ggd7;e71 ! *ief executive (fic] %all e/abli% & collect fees f eligible fund+ recipi5ts ) respect to loans & loan gu>antees "u ?is "p t-- 7#a7 are suffici5t to cov] all or a portion ( ! adm9i/rative co/s to ! ,f$]al ,gov]nm5t = ! op]ations ( ,,aifa1 includ+ ! co/s ( exp]t firms1 includ+ c\nsel 9 ! field ( municipal & project f9ance1 & f9ancial advisors to assi/ ) und]writ+1 cr$it analysis1 or o!r indep5d5t reviews1 z appropriate2 7#b7 may be 9 ! =m ( an application or transaction fee1 or o!r =m e/abli%$ by ! ,,ceo2 & 7#c7 may be bas$ on ! risk premium associat$ ) ! loan or loan gu>antee1 tak+ into consid]ation-- 7,a7 ! price ( ,unit$ ,/ates ,treasury obligations ( a simil> maturity2 7,b7 prevail+ m>ket conditions2 7,c7 ! ability ( ! infra/ructure project to support ! loan or loan gu>antee2 & 7,d7 ! total am\nt ( ! loan or loan gu>antee4 7b7 ,availability ( am\nts ,am\nts collect$ "u subsections 7a77#a71 7a77#b71 & 7a77#c7 %all be available )\t fur!r action2 provid$ fur!r1 t ! s\rce ( fees paid "u ?is section %all n be a loan or debt obligation gu>ante$ by ! ,f$]al ,gov]nm5t4 #ggh4 ,effici5cy ( ,,aifa ,! *ief executive (fic] %all1 to ! ext5t possible1 take actions consi/5t ) ?is "p to m9imize ! risk & co/ to ! taxpay] ( ,,aifa activities4 ,fees & premiums = loan gu>antee or insurance cov]age w be set at levels t m9imize adm9i/rative & ,f$]al cr$it subsidy co/s to ! ,gov]nm5t1 z def9$ 9 ,section #ejb ( ! ,f$]al ,cr$it ,re=m ,act ( #aiij1 z am5d$1 ( su* cov]age1 :ile support+ a*ievem5t ( ! program's objectives1 consi/5t ) policies z set =? 9 ! ,bus9ess ,plan4 #ggi4 ,fund+ ,!re is h]eby appropriat$ to ,,aifa to c>ry out ?is "p1 = ! co/ ( direct loans & loan gu>antees subject to ! limitations "u section #ggc1 & = adm9i/rative co/s1 #aj1jjj1jjj1jjj1 to rema9 available until exp5d$2 provid$1 t su* co/s1 includ+ ! co/s ( modify+ su* loans1 %all be z def9$ 9 section #ejb ( ! ,f$]al ,cr$it ,re=m ,act ( #aiij1 z am5d$2 provid$ fur!r1 t ( ?is am\nt1 n m ?an #be1jjj1jjj = ea* ( fiscal ye>s #bjac ?r\gh #bjad1 & n m ?an #ej1jjj1jjj = fiscal ye> #bjae may be us$ = adm9i/rative co/s ( ,,aifa2 provid$ fur!r1 t n m ?an #e p]c5t ( su* am\nt %all be us$ to (fset subsidy co/s associat$ ) rural projects4 ,am\nts au?oriz$ %all be available )\t fur!r action4 ,e ,ext5sion ( exemption f alt]native m9imum tax treatm5t = c]ta9 tax-,exempt bonds #ghj4 ,ext5sion ( exemption f alt]native m9imum tax treatm5t = c]ta9 tax-exempt bonds 7a7 ,9 g5]al ,clause 7vi7 ( section #eg7;a77#e77;,c7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$-- 7#a7 by /rik+ ,janu>y #a1 #bjaa 9 subclause 7,i7 & ins]t+ ,janu>y #a1 #bjad2 & 7#b7 by /rik+ & #bjaj 9 ! head+ & ins]t+ 1 #bjaj1 #bjaa1 #bjab & #bjac4 7b7 ,adju/$ curr5t e>n+s ,clause 7iv7 ( section #ef7;g77#d77;,b7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$-- 7#a7 by /rik+ ,janu>y #a1 #bjaa 9 subclause 7,i7 & ins]t+ ,janu>y #a1 #bjad2 & 7#b7 by /rik+ ,,& #bjaj 9 ! head+ & ins]t+ 1 #bjaj1 #bjaa1 #bjab & #bjac4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to obligations issu$ aft] ,decemb] #ca1 #bjaj4