,i  #aai? ,,congress  #a/ ,session  ,h4 
,r4 #bddj  ,,9 ,,! ,,h\se ,,(           
,,repres5tatives  ,m>* #bg1 #bjbe,mr4   
,hudson 7= himself & ,ms4 ,sewell7      
introduc$ ! foll[+ bill2 :i* 0 ref]r$ to
 ! ,committee on ,ways & ,means  ,a     
,,bill  ,to am5d ! ,int]nal ,rev5ue     
,code ( #aihf to provide = s*ool        
infra/ructure f9ance & innovation tax   
cr$it bonds4  #a4 ,%ort title ,?is ,act 
may be cit$ z ! ,s*ool ,infra/ructure   
,f9ance & ,innovation ,act or ! ,,sifia 
,act4  #b4 ,,sifia bonds  7a7 ,9 g5]al  
,"p ,,iv ( sub*apt] ,a ( *apt] #a is    
am5d$ by add+ at ! end ! foll[+ new     
subp>t3  ,k ,,sifia ,bonds  ,sec4       
#ed;,,bb4 ,,sifia bonds4  #ed;,,bb4     
,,sifia bonds  7a7 ,9 g5]al ,if a       
taxpay] holds a ,,sifia bond on "o or m 
cr$it all[ance dates ( ! bond dur+ any  
taxable ye>1 !re %all be all[$ z a cr$it
 aga9/ ! tax impos$ by ?is *apt] = !    
taxable ye> an am\nt equal to ! sum ( ! 
cr$its det]m9$ "u subsection 7b7 )      
respect to su* dates4  7b7 ,am\nt (     

cr$it  7#a7 ,9 g5]al ,! am\nt ( ! cr$it 
det]m9$ "u ?is subsection ) respect to  
any cr$it all[ance date = a ,,sifia bond
 is #be p]c5t ( ! annual cr$it det]m9$ =
 su* bond4  7#b7 ,annual cr$it ,=       
purposes ( ?is subsection1 ! t]m annual 
cr$it means an am\nt equal to ! product 
(-- 7,a7 ! applicable cr$it rate1       
multipli$ by  7,b7 ! face am\nt ( !     
bond4  7#c7 ,applicable cr$it rate ,=   
purposes ( p>agraph 7#b71 ! t]m         
applicable cr$it rate means ! rate :i* !
 ,secret>y e/imates w p]mit ! issuance (
 ea* su* bond ) a specifi$ maturity or  
r$emption date )\t disc\nt & )\t int]e/ 
co/ to ! issu]4 ,! applicable cr$it rate
 ) respect to any su* bond %all be      
det]m9$ z ( ! fir/ day on :i* !re is a  
b9d+1 writt5 contract = ! sale or       
ex*ange ( ! bond4  7c7 ,limitation bas$ 
on am\nt ( tax  7#a7 ,9 g5]al ,! cr$it  
all[$ "u subsection 7a7 = any taxable   
ye> %all n exce$ ! excess (-- 7,a7 ! sum
 ( ! regul> tax liability 7z def9$ 9    
section #bf7;b77 plus ! tax impos$ by   

section #ee1 ov]  7,b7 ! sum ( ! cr$its 
all[able "u ?is "p 7o!r ?an subp>t ,c & 
?is subp>t74  7#b7 ,c>ryov] ( unus$     
cr$it ,if ! cr$it all[able "u subsection
 7a7 exce$s ! limitation impos$ by      
p>agraph 7#a7 = su* taxable ye>1 su*    
excess %all be c>ri$ to ! succe$+       
taxable ye> & add$ to ! cr$it all[able  
"u subsection 7a7 = su* taxable ye>     
7det]m9$ be=e ! application ( p>agraph  
7#a7 = su* succe$+ taxable ye>74  7d7   
,cr$it all[ance date ,= purposes ( ?is  
section1 ! t]m cr$it all[ance date      
means1 ) respect to a bond dur+ !       
taxable ye>1 any ( ! foll[+ dates3 7#a7 
,m>* #ae4  7#b7 ,june #ae4  7#c7        
,septemb] #ae4  7#d7 ,decemb] #ae4  ,su*
 t]m includes ! la/ day on :i* ! bond is
 out/&+4  7e7 ,,sifia bonds  7#a7 ,9    
g5]al ,= purposes ( ?is section1 ! t]m  
,,sifia bond means any bond issu$ z "p (
 an issue if--  7,a7 #ajj p]c5t ( !     
available project proce$s ( su* issue   
are to be us$ = ! design1 con/ruction1  
expansion1 r5ovation1 furni%+1 or       

equipp+ ( qualifi$ s*ool facilities 7z  
def9$ 9 p>agraph 7#g77;,a7 ( ?is        
subsection7 pursuant to an agreem5t "u  
:i* a private1 =-pr(it entity agrees ) a
 ,/ate or local educational ag5cy-- 7i7 
to con/ruct1 exp&1 or r5ovate "o or m   
build+s con/itut+ ! qualifi$ s*ool      
facilities 7toge!r ) any relat$ design1 
furni%+1 & equipp+ ( su* build+s71  7ii7
 to op]ate ! facilities at lea/ until ! 
date ! facilities are fir/ plac$ 9      
s]vice & op]at+ sub/antially at _!      
design level1 &  7iii7 at or be=e ! end 
( ! agreem5t1 to transf] ! facilities to
 su* ag5cy = no additional consid]ation1
  7,b7 all build+s ^: con/ruction1      
expansion1 or r5ovations is includ$ 9 ! 
qualifi$ s*ool facilities be+ f9anc$ )  
proce$s ( a ,,sifia bond are reasonably 
expect$ to be net-z]o en]gy build+s1    
7,c7 ! int]e/ on su* bond w\ld 7b = ?is 
section & section #ada7 be excludable f 
gross income "u section #ajc1  7,d7 !   
issu] designates su* bond z a ,,sifia   
bond = purposes ( ?is subsection1  7,e7 

! bond is n issu$ ) m ?an a de m9imis   
am\nt ( premium 7det]m9$ "u rules simil>
 to ! rules ( section #abgc7;a77#c77 ov]
 ! /at$ pr9cipal am\nt ( ! bond1  7,f7 !
 issue ( :i* su* bond is a "p satisfies 
! exp5diture p]iod requirem5ts (        
p>agraph 7#b71  7,g7 ! private1 =-pr(it 
entity describ$ 9 subp>agraph 7,a7 meets
 ! allocation requirem5ts ( p>agraph    
7#e7 & ! report+ requirem5ts ( p>agraph 
7#f71 &  7,h7 ! bond is issu$ be=e      
,janu>y #a1 #bjca4  7#b7 #f-ye>         
exp5diture p]iod  7,a7 ,9 g5]al ,an     
issue %all be treat$ z meet+ !          
requirem5ts ( ?is p>agraph if1 z ( !    
date ( issuance1 ! issu] reasonably     
expects #ajj p]c5t ( ! available project
 proce$s to be sp5t = purposes describ$ 
9 subp>agraphs 7#a77;,a7 & 7#a77;,b7 )9 
! #f-ye> p]iod beg9n+ on su* date (     
issuance4  7,b7 ,failure to sp5d requir$
 am\nt ( bond proce$s )9 #f ye>s ,to !  
ext5t t less ?an #ajj p]c5t ( !         
available project proce$s ( ! issue are 
exp5d$ at ! close ( ! p]iod describ$ 9  

subp>agraph 7,a7 ) respect to su* issue1
 ! issu] %all r$eem all ( ! nonqualifi$ 
bonds )9 #ij days aft] ! end ( su*      
p]iod4 ,= purposes ( ?is p>agraph1 !    
am\nt ( ! nonqualifi$ bonds requir$ to  
be r$eem$ %all be det]m9$ 9 ! same mann]
 z "u section #ada4  7#c7 ,limitation on
 am\nt ( sifia bonds designat$  7,a7    
,ov]all limitation ,! maximum aggregate 
face am\nt ( ,,sifia bonds issu$ "u ?is 
subsection t may be designat$ "u        
subp>agraph 7#a77;,d7 is                
#aj1jjj1jjj1jjj4  7,b7 ,annual          
limitation ,! maximum aggregate face    
am\nt ( ,,sifia bonds issu$ "u ?is      
subsection t may be designat$ "u        
subp>agraph 7#a77;,d7 9 any cal5d> ye>  
is #b1ejj1jjj1jjj4  7,c7 ,set-aside =   
rural areas  7i7 #a1jjj1jjj1jjj ( !     
ov]all limitation describ$ 9 subp>agraph
 7,a7 %all be set aside = projects      
locat$ 9 rural areas4  7ii7 ,= purposes 
( ?is section1 ! t]m rural area means   
any area :i* is-- 7,i7 outside ( a      
metropolitan /ati/ical area 7z su* area 

is def9$ by ! ,secret>y ( ,comm]ce7 or  
7,,ii7 det]m9$ by ! ,secret>y (         
,agriculture1 aft] consultation ) !     
,secret>y ( ,comm]ce1 to be a rural     
area4  7#d7 ,allocation ( limitation ,! 
au?ority to issue ,,sifia bonds )9 !    
limitations set =? 9 p>agraph 7#c7 %all 
be allocat$ by ! ,secret>y to           
prospective issu]s on a fir/ come-fir/  
s]v$ basis1 "u rules to be prescrib$ by 
! ,secret>y1 provid$ t--  7,a7 no s*ool 
di/rict %all be allocat$ m ?an          
#a1ejj1jjj1jjj 9 aggregate face am\nt ( 
,,sifia bonds "u ?is subsection1  7,b7  
no m ?an #ejj1jjj1jjj 9 aggregate face  
am\nt ( ,,sifia bonds %all be allocat$  
"u ?is subsection = ! con/ruction1      
expansion1 r5ovation1 furni%+1 or       
equipp+ ( qualifi$ s*ool facilities t   
are op]at$ by a nonpr(it organization "u
 a *>t] or o!r agreem5t betwe5 !        
applicable s*ool di/rict & su* nonpr(it 
organization1  7,c7 an issu] apply+ = an
 allocation %all c]tify 7bas$ on !      
c]tifications ( any conduit borr[] (    

bond proce$s :]e applicable7 t x        
reasonably expects to comm5ce ! project 
to be f9anc$ ) proce$s ( ! bonds )9 #f  
mon?s ( ! issue date ( ! bonds1 & to    
exp5d all ( ! available project proce$s 
)9 #f ye>s ( ! issue date ( ! bonds1 &  
7,d7 9 mak+ su* allocations1 ! ,secret>y
 %all give pref]5ce to ! f9anc+ (       
projects = :i* ! private =-pr(it        
develop] is a pref]r$ conc]n4  7#e7     
,requirem5ts relat+ to private1 =-pr(it 
entities ,a private1 =-pr(it entity     
meets ! requirem5ts ( ?is p>agraph if   
su* entity-- 7,a7 has exp]i5ce develop+1
 own+1 & op]at+ public s*ools leas$ to  
public s*ool di/ricts t are net-z]o     
build+s1 &  7,b7 demon/rates to !       
,secret>y 79 su* mann] z ! ,secret>y may
 provide7 t su* entity has exp]i5ce     
leas+ public s*ool build+s to a local   
education ag5cy1 includ+ at lea/ two    
projects ) respect to :i*-- 7i7 su*     
entity 7or a relat$ p]son7 develop$1    
own$1 & 0 responsible =--  7,i7         
ma9t5ance (-- 7aa7 ! heat+1 v5tilation1 

& air condition+ sy/em1 or  7bb7 ! sol> 
photovoltaic sy/em1 &  7ii7 ! electrical
 s]vice 0 9 ! "n ( su* entity = a m9imum
 ( f\r ye>s4  7#f7 ,report+ requirem5ts 
,a private entity meets ! requirem5ts ( 
?is p>agraph if su* entity1 9 coop]ation
 ) ! applicable s*ool di/rict1          
p]iodically submits su* reports z !     
,secret>y %all prescribe relat+ to !    
co/s & b5efits ( ! f9anc+1 includ+--    
7,a7 tax b5efits to ! ,f$]al ,gov]nm5t &
 co/ sav+s to ! s*ool di/rict1 &  7,b7  
in=mation relat$ to any improvem5ts 9   
/ud5t p]=mance or tea*] ret5tion4  7#g7 
,def9itions ,= purposes ( ?is           
subsection--  7,a7 ,qualifi$ s*ool      
facilities ,! t]m qualifi$ s*ool        
facilities means "o or m s*ool build+s =
 a public elem5t>y s*ool or public      
second>y s*ool or = adm9i/rative or     
support facilities relat+ to su* s*ool  
facilities1 toge!r ) relat$ furni%+s &  
equipm5t4  7,b7 ,s*ool di/rict ,! t]m   
s*ool di/rict means a public bo>d (     
education or o!r public au?ority legally

 con/itut$ )9 a ,/ate = adm9i/rative    
control or direction ( public elem5t>y  
or second>y s*ools 9 ! ,/ate or         
political subdivision ( a ,/ate4  7,c7  
,pref]r$ conc]n ,! t]m pref]r$ conc]n   
means ei!r a small bus9ess conc]n1 a    
m9ority own$ conc]n1 or a woman own$    
conc]n4  7,d7 ,small bus9ess conc]n  7i7
 ,9 g5]al ,subject to ! provisions (    
clause 7ii71 ! t]m small bus9ess conc]n 
means an entity :i*1 toge!r ) any relat$
 p]son1 has few] ?an #ejj employees4    
7ii7 ,small bus9ess size /&>ds ,=       
purposes ( clause 7i71 ! det]m9ation (  
numb] ( employees %all be made 9 a mann]
 consi/5t )-- 7,i7 section #c ( ! ,small
 ,bus9ess ,act 7#ae ,u4,s4,c4 #fcb71 &  
7,,ii7 "p #aba ( title #ac1 ,code (     
,f$]al ,regulations4  7,e7 ,m9ority own$
 ,! t]m m9ority own$ ) respect to an    
entity means an entity n less ?an #ea   
p]c5t ( :i* is own$ by #a or m          
individuals :o are citiz5s ( ! ,unit$   
,/ates & :o are ,asian ,am]ican1 ,native
 ,hawaiian1 ,pacific ,isl&]1 ,african   

,am]ican1 ,hispanic1 ,pu]to ,rican1     
,native ,am]ican1 or ,alaska ,native4   
7,f7 ,woman own$ ,! t]m woman own$ )    
respect to an entity means an entity n  
less ?an #ea p]c5t ( :i* is own$ by #a  
or m wom54  7,g7 ,nonpr(it organization 
,! t]m nonpr(it organization means an   
organization describ$ 9 section #eja7;c7
 & exempt f tax "u section #eja7;a74    
7,h7 ,net-z]o en]gy build+ ,! t]m       
#8net-z]o build+' has ! mean+ giv5 su*  
t]m "u section #daj7bj7 ( ! ,en]gy      
,indep5d5ce & ,security ,act ( #bjjg    
7#db ,u4,s4,c4 #agjfa7bj771 appli$ by   
sub/itut+ s*ool build+ = comm]cial      
build+4  7,i7 ,relat$ p]son ,! t]m      
relat$ p]son has ! mean+ giv5 su* t]m 9 
section #add7;a77#c74  7f7 ,o!r         
applicable rules  7#a7 ,int]e/          
includible 9 gross income ,= purposes ( 
?is title1 int]e/ on any ,,sifia bond   
%all be includible 9 gross income4  7#b7
 ,cr$it treat$ z int]e/ ,= purposes (   
?is subtitle1 ! cr$it det]m9$ "u        
subsection 7a7 %all be treat$ z int]e/  

:i* is includible 9 gross income4  7#c7 
,s corporations & p>tn]%ips ,9 ! case ( 
a tax cr$it bond held by an ,s          
corporation or p>tn]%ip1 ! allocation ( 
cr$it all[$ by ?is section to !         
%>ehold]s ( su* corporation or p>tn]s ( 
su* p>tn]%ip %all be treat$ z a         
di/ribution4  7#d7 ,bonds held by real  
e/ate inve/m5t tru/s ,if any qualifi$   
tax cr$it bond is held by a real e/ate  
inve/m5t tru/ ! cr$it det]m9$ "u        
subsection 7a7 %all be all[$ to         
b5efici>ies ( su* tru/ 7& any gross     
income includ$ "u p>agraph 7#b7 )       
respect to su* cr$it %all be di/ribut$  
to su* b5efici>ies7 "u proc$ures        
prescrib$ by ! ,secret>y 7simil> to !   
proc$ures prescrib$ by ! ,secret>y "u   
section #ed;,a7h7 7z 9 effect be=e its  
repeal by ,public ,law #aae-ig774  7#e7 
,cr$its may be /ripp$ ,"u regulations   
prescrib$ by ! ,secret>y 7simil> to     
regulations prescrib$ "u section        
#ed;,a7i7 7z 9 effect be=e its repeal by
 ,public ,law #aae-ig7-- 7,a7 ,9 g5]al  

,!re may be a sep>ation 7includ+ at     
issuance7 ( ! own]%ip ( a qualifi$ tax  
cr$it bond & ! entitlem5t to ! cr$it "u 
?is section ) respect to su* bond4 ,9   
case ( any su* sep>ation1 ! cr$it "u ?is
 section %all be all[$ to ! p]son :o on 
! cr$it all[ance date holds ! in/rum5t  
evid5c+ ! entitlem5t to ! cr$it & n to !
 hold] ( ! bond4  7,b7 ,c]ta9 rules to  
apply ,9 ! case ( a sep>ation describ$ 9
 subp>agraph 7,a71 ! rules ( section    
#abhf %all apply to ! qualifi$ tax cr$it
 bond z if x 7 a /ripp$ bond & to !     
cr$it "u ?is section z if x 7 a /ripp$  
c\pon4  7#f7 ,n treat$ z f$]ally        
gu>ante$ ,= purposes ( section #adi7;b71
 a ,,sifia bond %all n be treat$ z      
f$]ally gu>ante$ by reason ( ! cr$it    
all[$ "u subsection 7g74  7#g7 ,yield   
det]m9ation ,= purposes ( section #adh1 
! yield on a ,,sifia bond %all be       
det]m9$ )\t reg>d to ! cr$it all[$ "u   
subsection 7a74  7#h7 ,maturity         
limitation  7,a7 ,9 g5]al ,an issue %all
 be treat$ z meet+ ! requirem5ts ( ?is  

section if ! maturity ( any bond :i* is 
"p ( su* issue does n exce$ ! maximum   
t]m det]m9$ by ! ,secret>y "u           
subp>agraph 7,b74  7,b7 ,maximum t]m    
,dur+ ea* cal5d> mon?1 ! ,secret>y %all 
det]m9e ! maximum t]m p]mitt$ "u ?is    
p>agraph = bonds issu$ dur+ ! foll[+    
cal5d> mon?4 ,su* maximum t]m %all be ! 
t]m :i* ! ,secret>y e/imates w result 9 
! pres5t value ( ! obligation to repay !
 pr9cipal on ! bond be+ equal to #bj    
p]c5t ( ! face am\nt ( su* bond4 ,su*   
pres5t value %all be det]m9$ us+ z a    
disc\nt rate ! av]age annual int]e/ rate
 ( tax-exempt obligations hav+ a t]m (  
#aj ye>s or m :i* are issu$ dur+ ! mon?4
 ,if ! t]m z s det]m9$ is n a multiple (
 a :ole ye>1 su* t]m %all be r\nd$ to ! 
next highe/ :ole ye>4  7#i7             
,depreciation ,if ! s*ool facilities    
f9anc$ ) proce$s ( ,,sifia bonds are    
own$ by a p]son o!rwise entitl$ to      
all[ance = depreciation ) respect to su*
 facility1 t p]son may make an          
irrevocable election 7b9d+ on any       

successors 9 int]e/7 n to claim         
depreciation ) respect to ! prop]ty     
f9anc$ ) proce$s ( ! ,,sifia bonds = s  
long z ! issue ( :i* su* bonds are a "p 
is out/&+4 ,su* election %all be deem$  
to h be5 made if ! p]son fails to claim 
depreciation ) respect to ! prop]ty 9 ! 
fir/ tax return fil$ by ! p]son 9 :i*   
su* depreciation c\ld h be5 claim$4 ,to 
! ext5t ! p]son elects n to claim       
depreciation "u ?is p>agraph1 ! basis ( 
! f9anc$ prop]ty %all n be r$uc$ "u     
section #ajaf or o!rwise = !            
depreciation t c\ld h be5 claim$4  4    
7b7 ,treatm5t ( int]e/ z unrelat$       
bus9ess taxable income ,section         
#eab7;b77#a7 ( su* ,code is am5d$ by    
ins]t+ 7o!r ?an int]e/ ( ,,sifia bonds  
issu$ "u section #ed;,,bb7 aft] int]e/4 
7c7 ,cl]ical am5dm5ts ,! table ( subp>ts
 = "p ,,iv ( sub*apt] ,a ( *apt] #a is  
am5d$ by add+ at ! end ! foll[+3        
,subp>t ,k--,,sifia ,bonds  4  7d7      
,direct pur*ases ( ,,sifia bonds ,!     
,secret>y %all pur*ase ,,sifia bonds t !

 issu] is o!rwise unable to sell1       
subject to proc$ures & cr$it /&>ds to be
 e/abli%$ by ! ,secret>y1 :i* /&>ds &   
proc$ures %all be simil> to ^?          
applicable to loans made "u l9es ( cr$it
 "u section #aejc ( ! ,transportation   
,infra/ructure ,f9ance & ,innovation    
,act ( #aiih 7#bc ,u4,s4,c4 #ahd74  7e7 
,effective date ,! am5dm5ts made by ?is 
section %all apply to obligations issu$ 
aft] ,decemb] #ca1 #bjbe4