,i #aafth ,,congress #ast ,session ,h4 ,r4 #ejdb ,,in ,,the ,,house ,,of ,,representatives ,november #ab1 #bjai,mr4 ,clyburn 7for himself1 ,ms4 ,adams1 and ,mr4 ,clay7 introduced the following bill2 which was referred to the ,committee on ,ways and ,means ,a ,,bill ,to amend the ,internal ,revenue ,code of #aihf to reform rules related to qualified opportunity zones4 #a4 ,short title ,this ,act may be cited as the ,opportunity ,zone ,reform ,act4 #b4 ,modification of tracts qualified to be designated as qualified opportunity zones 7a7 ,disqualification of certain census tracts 7#a7 ,census tracts with high median family income ,paragraph 7#a7 of section #adjj,z-#a7;c7 of the ,internal ,revenue ,code of #aihf is amended to read as follows3 7#a7 ,low-income communities 7,a7 ,in general ,except as provided in subparagraph 7,b71 the term low-income community has the same meaning as when used in section #de;,d7e74 7,b7 ,exception 7i7 ,in general ,such term shall not include any census tract if the median family income for such tract exceeds #abj percent of the national median family income 7as determined based the most recent data published by the ,bureau of the ,census on the date of the enactment of the ,opportunity ,zone ,reform ,act74 7ii7 ,special rule ,clause 7i7 shall not apply to any census tract if-- 7,i7 the poverty rate for such tract is at least #bj percent1 and 7,,ii7 less than #aj percent of the population of such tract is enrolled in an institution of higher education 7as defined in section #aja of the ,higher ,education ,act of #aife74 4 7#b7 ,contiguous census tracts ,section #adjj,z-#a of such ,code is amended by striking subsection 7e7 and redesignating subsection 7f7 as subsection 7e74 7b7 ,treatment of previously designated tracts ,section #adjj,z-#a of such ,code1 as amended by subsection 7a77#b71 is amended by adding at the end the following3 7f7 ,treatment of certain census tracts 7#a7 ,in general ,except as provided in section #adjj,z-#b7;d77#b77;,d71 any census tract 7other than a census tract in ,puerto ,rico7 which is not a low-income community and which was designated as a qualified opportunity zone before the date of the enactment of the ,opportunity ,zone ,reform ,act shall not be treated as a qualified opportunity zone on or after such date of enactment4 7#b7 ,replacement zones 7,a7 ,in general ,a ,state may designate a low-income community as a qualified opportunity zone to replace a census tract the status of which as a qualified opportunity zone was terminated by reason of paragraph 7#a74 7,b7 ,special rules ,for purposes of this subchapter-- 7i7 the determination period with respect to a designation under subparagraph 7,a7 shall be the #ij-;day period beginning on the date of the enactment of such ,act1 as extended under subsection 7b77#b71 and 7ii7 the period for which any such designation is in effect shall be the period beginning with the date such designation takes effect and ending with the last day of the #ajth calendar year beginning on or after the designation date as a qualified opportunity zone for the census tract which it is replacing as such a zone by reason of the termination under clause 7i74 4 7c7 ,treatment of existing investments ,section #adjj,z-#b7;d77#b77;,d7 of such ,code is amended by adding at the end the following new clause3 7iv7 ,special rule for investments in certain census tracts 7,i7 ,in general ,for purposes of applying this paragraph1 the use of property in a qualified census tract shall be treated as use of property in a qualified opportunity zone if the original use of such property occurred before ,november #f1 #bjai1 or in the case of property acquired before such date1 the property was substantially improved before the close of the #cj-month period beginning with the month of the acquisition4 7,,ii7 ,qualified census tract ,for purposes of this clause1 the term qualified census tract means any census tract which is not a low-income community and which was designated as a qualified opportunity zone before the date of the enactment of the ,opportunity ,zone ,reform ,act4 4 #c4 ,maintenance of geographic boundaries of qualified opportunity zones ,section #adjj,z-#a7;e7 of the ,internal ,revenue ,code of #aihf1 as redesignated by section #b7;a77#b71 is amended by adding at the end the following new sentence3 ,such designation shall apply to the geographic area as in effect at the time such tract is designated without regard to whether adjustments are made to the boundaries of the census tract so designated44 #d4 ,modification of prohibition on certain types of trades or business as qualified opportunity zone businesses 7a7 ,in general ,section #adjj,z-#b7;d77#c77;,a77iii7 of the ,internal ,revenue ,code of #aihf is amended by striking in section #add7;c77#f77;,b7 and inserting subsections 7a77#h77;,b7 or 7c77#f77;,b7 of section #add or section #adg7;e74 7b7 ,effective date ,the amendment made by this section shall take effect on ,november #f1 #bjai4 #e4 ,other modifications related to qualified opportunity funds 7a7 ,application of qualified opportunity zone business rules to trades or businesses conducted by qualified opportunity zone funds 7#a7 ,in general ,section #adjj,z-#b7;d77#a7 of the ,internal ,revenue ,code of #aihf is amended to read as follows3 7#a7 ,in general ,the term qualified opportunity fund means any investment vehicle-- 7,a7 which is organized as a corporation or a partnership for the purpose of investing in qualified opportunity zone property 7other than another qualified opportunity fund7 that holds at least #ij percent of its assets in qualified opportunity zone property1 determined by the average of the percentage of qualified opportunity zone property held in the fund as measured-- 7i7 on the last day of the first #f-month period of the taxable year of the fund1 and 7ii7 on the last day of the taxable year of the fund1 and 7,b7 any trade or business of which is a qualified opportunity zone business4 4 7#b7 ,effective date ,the amendments made by this subsection shall take effect as if included in section #achbc of ,public ,law #aae-ig4 7b7 ,clarification of substantially all 7#a7 ,in general ,section #adjj,z-#b7;d7 of the ,internal ,revenue ,code of #aihf is amended-- 7,a7 by striking during substantially all each place it appears in paragraphs 7#b77;,b77i77,,iii71 7#b77;,c77iii71 and 7#b77;,d77i77,,iii7 and inserting for not less than #ij percent1 7,b7 by striking substantially all of the use in paragraph 7#b77;,d77i77,,iii7 and inserting not less than #ij percent of the use1 and 7,c7 by striking in which substantially all in paragraph 7#c77;,a77i7 and inserting in which not less than #ij percent4 7#b7 ,effective date ,the amendments made by this subsection shall take effect as if included in section #achbc of ,public ,law #aae-ig4 7c7 ,certain property excluded from qualified opportunity zone business property 7#a7 ,in general ,section #adjj,z-#b7;d77#b77;,d7 of the ,internal ,revenue ,code of #aihf is amended-- 7,a7 in clause 7i71 by inserting 7other than self-storage property1 parking property1 stadium property1 or disqualified residential rental property7 after tangible property1 and 7,b7 by adding at the end the following new clauses3 7iv7 ,self-storage property ,the term self-storage property means property designed and used for the purpose of renting or leasing individual storage space to occupants who are to have access to such space for the purpose of storing and removing personal property4 7v7 ,parking property ,the term parking property means any property #ij percent or more of the square footage of which is used for parking or for the ingress or egress of vehicles4 7vi7 ,stadium ,the term stadium property means any facility 7or appurtenant real property7 which1 during at least #e days during any calendar year1 is used as a stadium or arena for professional sports exhibitions1 games1 or training4 7vii7 ,disqualified residential rental property ,the term disqualified residential rental property means any residential rental property unless #ej percent or more of the residential units of such property are both rent-restricted 7within the meaning of section #db7;g77#b77 and occupied by individuals whose income is #ej percent or less of area median income4 4 7#b7 ,effective date ,the amendments made by this subsection shall take effect as if included in section #achbc of ,public ,law #aae-ig4 7d7 ,treatment of leased property 7#a7 ,in general ,section #adjj,z-#b7;d77#b77;,d77i77,i7 of the ,internal ,revenue ,code of #aihf is amended by inserting or under a lease 7other than a lease from a related person7 entered into after ,december #ca1 #bjag1 after ,december #ca1 #bjag14 7#b7 ,effective date ,the amendment made by this subsection shall take effect as if included in section #achbc of ,public ,law #aae-ig4 7e7 ,correction relating to original use of qualified opportunity zone business property 7#a7 ,in general ,section #adjj,z-#b7;d77#b77;,d77i77,,ii7 of the ,internal ,revenue ,code of #aihf is amended by striking in the qualified opportunity zone4 7#b7 ,effective date ,the amendment made by this subsection shall take effect as if included in section #achbc of ,public ,law #aae-ig4 7f7 ,modification of determination of substantial improvement of qualified opportunity zone business property 7#a7 ,in general ,section #adjj,z-#b7;d77#b77;,d77ii7 of the ,internal ,revenue ,code of #aihf is amended by inserting 7including land7 after adjusted basis of such property4 7#b7 ,effective date ,the amendment made by this subsection shall take effect as if included in section #achbc of ,public ,law #aae-ig4 #f4 ,public list of qualified opportunity funds ,the ,secretary of the ,treasury 7or the ,secretary's delegate7 shall maintain and make publicly available on the internet and at the offices of the ,internal ,revenue ,service-- 7#a7 a list of investment vehicles that are certified as qualified opportunity funds 7as defined in section #adjj,z-#b7;d77#a7 of the ,internal ,revenue ,code of #aihf7 pursuant to the rules established under section #adjj,z-#b7;e77#d77;,a7 of such ,code1 and 7#b7 the name1 address1 and the uniform resource locator 7,,url7 for the website for such fund4 #g4 ,,gao ,report 7a7 ,in general ,not later than each applicable date1 the ,comptroller ,general of the ,united ,states shall submit to ,congress a report on the effectiveness of the provisions of subchapter ,z of chapter #a of the ,internal ,revenue ,code of #aihf in achieving the policies of such provisions4 7b7 ,matters included ,the reports submitted under subsection 7a7 shall include an analysis of-- 7#a7 the distribution of investments of qualified opportunity funds among qualified opportunity zones1 7#b7 the distribution of such investments across different industries or investment purposes1 7#c7 the impact of the designation of an area as a qualified opportunity zone on-- 7,a7 economic indicators1 including employment1 new business start-ups1 and poverty reduction1 7,b7 housing costs1 and 7,c7 income distribution among residents of such zones1 7#d7 the economic benefits provided by such designations compared to economic costs1 and 7#e7 to the extent practicable1 the impact of the provisions of such subchapter ,z on low-income communities that have not been designated as qualified opportunity zones4 7c7 ,definitions 7#a7 ,applicable date ,the term applicable date means-- 7,a7 the date that is #e years after the date of the enactment of this ,act1 and 7,b7 the date that is #aj years after the date of the enactment of this ,act4 7#b7 ,other terms ,any term used in this section which is also used in subchapter ,z of chapter #a of the ,internal ,revenue ,code of #aihf shall have the meaning given such term under such subchapter4