,i  #aai? ,,congress  #a/ ,session  ,h4 
,r4 #ecg  ,,9 ,,! ,,h\se ,,(            
,,repres5tatives  ,janu>y #af1 #bjbe,ms4
 ,%]rill introduc$ ! foll[+ bill2 :i* 0 
ref]r$ to ! ,committee on ,ways &       
,means1 & 9 addition to ! ,committee on 
,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 am5d ! ,int]nal 
,rev5ue ,code ( #aihf to provide tax    
cr$its = ! conv]sion ( comm]cial build+s
 to resid5tial units1 to provide support
 & te*nical assi/ance to ,/ate & local  
h\s+ ag5cies to id5tify & advance h\s+  
conv]sion opportunities = und]utiliz$   
comm]cial build+s1 & = o!r purposes4    
#a4 ,%ort title ,?is ,act may be cit$ z 
! ,inc5tiviz+ ,new ,conv]sions to       
,resid5tial ,entities to ,accel]ate     
,supply & ,exp& ,h\s+ ,af=dability ,act 
or ! ,,increase ,h\s+ ,af=dability ,act4
  #b4 ,comm]cial-to-resid5tial cr$it    
7a7 ,9 g5]al ,section #df ( ! ,int]nal  

,rev5ue ,code ( #aihf is am5d$ by       
r$esignat+ p>agraph 7#g7 z p>agraph     
7#h71 by r$esignat+ ! p>agraph 7#f7     
relat+ to ! advanc$ manufactur+ inve/m5t
 cr$its z p>agraph 7#g71 by /rik+ & at !
 end ( p>agraph 7#g7 7z s r$esignat$71  
by /rik+ ! p]iod at ! end ( p>agraph    
7#h7 7z s r$esignat$7 & ins]t+ 1 &1 & by
 add+ at ! end ! foll[+ new p>agraph3   
7#i7 ! comm]cial-to-resid5tial cr$it4  4
  7b7 ,am\nt ( cr$it ,subp>t ,e ( "p    
,,iv ( sub*apt] ,a ( *apt] #a ( !       
,int]nal ,rev5ue ,code ( #aihf is am5d$ 
by ins]t+ aft] section #dh;,e ! foll[+  
new section3  #dh;,f4                   
,comm]cial-to-resid5tial cr$it  7a7 ,9  
g5]al ,= purposes ( section #df1 !      
comm]cial-to-resid5tial cr$it = any     
taxable ye> is equal to #ae p]c5t ( !   
qualifi$ conv]sion exp5ditures ) respect
 to a qualifi$ conv]t$ build+4  7b7     
,limitation on cr$it am\nt ,! cr$it     
det]m9$ "u subsection 7a7 may n exce$-- 
7#a7 #bjj1jjj p] new resid5tial h\s+    
unit1 &  7#b7 #aj1jjj1jjj p] qualifi$   

conv]t$ build+4  7c7 ,:5 exp5ditures    
tak5 into acc\nt  7#a7 ,9 g5]al         
,qualifi$ conv]sion exp5ditures )       
respect to any qualifi$ conv]t$ build+  
%all be tak5 into acc\nt = ! taxable ye>
 9 :i* su* qualifi$ conv]t$ build+ is   
plac$ 9 s]vice4  7#b7 ,coord9ation )    
subsection 7e7 ,! am\nt :i* w\ld 7b =   
?is subp>agraph7 be tak5 into acc\nt "u 
subp>agraph 7,a7 ) respect to any       
qualifi$ conv]t$ build+ %all be r$uc$ 7b
 n bel[ z]o7 by any am\nt ( qualifi$    
conv]sion exp5ditures tak5 into acc\nt  
"u subsection 7e7 by ! taxpay] or a     
pr$ecessor ( ! taxpay] 7or1 9 ! case ( a
 sale & leaseback describ$ 9 section    
#ej7;a77#b77;,c71 by ! lessee71 to !    
ext5t any am\nt s tak5 into acc\nt has n
 be5 requir$ to be recaptur$ "u section 
#ej7;a74  7d7 ,bonus cr$its  7#a7       
,af=dable h\s+ bonus cr$it  7,a7 ,9     
g5]al ,9 ! case ( a qualifi$ conv]t$    
build+ :i* has be5 conv]t$ to a majority
 r5tal resid5tial use & :i* satisfies ! 
requirem5ts "u subp>agraph 7,b71 ! am\nt

 ( ! cr$it det]m9$ "u subsection 7a7    
7det]m9$ )\t reg>d to ?is subsection7 & 
! limitation on cr$it am\nt describ$ 9  
subsection 7b7 7det]m9$ )\t reg>d to ?is
 subsection7 ) respect to su* build+    
%all ea* be increas$ by an am\nt equal  
to-- 7i7 9 ! case ( a qualifi$ conv]t$  
build+ #be p]c5t or m ( ! resid5tial    
units ( :i* are bo? r5t-re/rict$ &      
occupi$ by individuals ^: income does n 
exce$ #ajj p]c5t ( area m$ian income1   
#aj p]c5t ( su* am\nts1  7ii7 9 ! case (
 a qualifi$ conv]t$ build+ #be p]c5t or 
m ( ! resid5tial units ( :i* are bo?    
r5t-re/rict$ & occupi$ by individuals ^:
 income does n exce$ #hj p]c5t ( area   
m$ian income1 #ae p]c5t ( su* am\nts1 & 
7iii7 9 ! case ( a qualifi$ conv]t$     
build+ #be p]c5t or m ( ! resid5tial    
units ( :i* are bo? r5t-re/rict$ &      
occupi$ by individuals ^: income does n 
exce$ #fj p]c5t ( area m$ian income1 #bj
 p]c5t ( su* am\nts4  7,b7 ,r5t & income
 limitation ,= purposes ( subp>agraph   
7,a71 rules simil> to ! rules ( section 

#db7;g7 %all apply to det]m9e :e!r a    
unit is r5t-re/rict$1 treatm5t ( units  
occupi$ by individuals ^: incomes rise  
above ! limit1 & treatm5t ( units :]e   
,f$]al r5tal assi/ance is r$uc$ z       
t5ant's income increases4  7#b7         
,prevail+ wage bonus cr$it  7,a7 ,9     
g5]al ,9 ! case ( any qualifi$ conv]t$  
build+ ) respect to :i* ! taxpay]       
c]tifies to ! ,secret>y t ! taxpay]     
satisfi$ ! requirem5t ( subp>agraph 7,b7
 ) respect to ! conv]sion process1 !    
am\nt ( ! cr$it det]m9$ "u subsection   
7a7 7det]m9$ )\t reg>d to ?is           
subsection7 & ! limitation on ! cr$it   
am\nt describ$ 9 subsection 7b7 7det]m9$
 )\t reg>d to ?is subsection7 ) respect 
to su* build+ %all ea* be increas$ by an
 am\nt equal to #ae p]c5t ( su* am\nts4 
7,b7 ,prevail+ wage requirem5t ,!       
requirem5t describ$ 9 ?is subp>agraph is
 satisfi$ ) respect to any conv]sion if 
all labor]s or me*anics employ$ by !    
taxpay] or any contractor or            
subcontractor ( ! taxpay] to c>ry out ! 

conv]sion 7 paid wages at rates n less  
?an ! prevail+ rates = con/ruction1     
alt]ation1 or repair ( a simil> "* 9 !  
locality 9 :i* su* project is locat$ z  
mo/ rec5tly det]m9$ by ! ,secret>y (    
,labor1 9 accordance ) sub*apt] ,,iv (  
*apt] #ca ( title #dj1 ,unit$ ,/ates    
,code4  7e7 ,def9itions  7#a7 ,qualifi$ 
conv]t$ build+  7,a7 ,9 g5]al ,! t]m    
qualifi$ conv]t$ build+ means any build+
 7& its /ructural compon5ts7 if-- 7i7   
prior to conv]sion1 su* build+ 0        
nonresid5tial real prop]ty 7z def9$ 9   
section #afh7 :i* 0 leas$1 or available 
= lease1 to (fice t5ants1  7ii7 su*     
build+ has be5 sub/antially conv]t$ f an
 (fice use to a resid5tial or           
resid5tial-retail mix$ use1  7iii7 su*  
build+ 0 initially plac$ 9 s]vice at    
lea/ #ae ye>s be=e ! beg9n+ ( !         
conv]sion1 &  7iv7 depreciation 7or     
amortization 9 lieu ( depreciation7 is  
all[able ) respect to su* build+4  7,b7 
,sub/antially conv]t$ def9$  7i7 ,9     
g5]al ,= purposes ( p>agraph            

7#a77;,a77ii71 a build+ %all be treat$ z
 hav+ be5 sub/antially conv]t$ only if !
 qualifi$ conv]sion exp5ditures dur+ !  
#bd-mon? p]iod select$ by ! taxpay] 7at 
! "t & 9 ! mann] prescrib$ by           
regulation7 & end+ ) or )9 ! taxable ye>
 exce$ ! great] (-- 7,i7 ! adju/$ basis 
( su* build+ 7& its /ructural           
compon5ts71 or  7,,ii7 #ae1jjj4  ,!     
adju/$ basis ( ! build+ 7& its /ructural
 compon5ts7 %all be det]m9$ z ( ! beg9n+
 ( ! #a/ day ( su* #bd-mon? p]iod1 or ( 
! hold+ p]iod ( ! build+1 :i*ev] is     
lat]4 ,= purposes ( ! prec$+ s5t5ce1 !  
det]m9ation ( ! beg9n+ ( ! hold+ p]iod  
%all be made )\t reg>d to any           
recon/ruction by ! taxpay] 9 connection 
) ! conv]sion4  7ii7 ,special rule =    
phas$ conv]sion ,9 ! case ( any         
conv]sion :i* may reasonably be expect$ 
to be complet$ 9 phases set =? 9        
ar*itectural plans & specifications     
complet$ be=e ! conv]sion beg9s1 clause 
7i7 %all be appli$ by sub/itut+ #fj-mon?
 p]iod = #bd-mon? p]iod4  7iii7 ,lessees

 ,! ,secret>y %all prescribe by         
regulation rules = apply+ ?is           
subp>agraph to lessees4  7,c7           
,recon/ruction ,conv]sion includes      
recon/ruction4  7#b7 ,qualifi$ conv]sion
 exp5ditures def9$  7,a7 ,9 g5]al ,=    
purposes ( subsection 7a71 ! t]m        
qualifi$ conv]sion exp5ditures means any
 am\nt prop]ly *>geable to capital      
acc\nt-- 7i7 = prop]ty = :i*            
depreciation is all[able "u section #afh
 & :i* is-- 7,i7 nonresid5tial real     
prop]ty 7z def9$ 9 section #afh71       
7,,ii7 resid5tial r5tal prop]ty 7z def9$
 9 section #afh71 or  7,,iii7 an        
addition or improvem5t to prop]ty       
describ$ 9 clause 7i7 or 7ii71 &  7ii7 9
 connection ) ! conv]sion ( a qualifi$  
conv]t$ build+4  7,b7 ,c]ta9 exp5ditures
 n includ$ ,! t]m qualifi$ conv]sion    
exp5ditures does n include-- 7i7        
,/raight l9e depreciation mu/ be us$    
,any exp5diture ) respect to :i* !      
taxpay] does n use ! /raight l9e me?od  
ov] a recov]y p]iod det]m9$ "u          

subsection 7c7 or 7g7 ( section #afh4 ,!
 prec$+ s5t5ce %all n apply to any      
exp5diture to ! ext5t ! alt]native      
depreciation sy/em ( section #afh7;g7   
applies to su* exp5diture by reason (   
subp>agraph 7,b7 or 7,c7 ( section      
#afh7;g77#a74  7ii7 ,co/ ( acquisition  
,! co/ ( acquir+ any build+ or int]e/   
!re94  7iii7 ,enl>gem5ts ,any exp5diture
 attributable to ! enl>gem5t ( an exi/+ 
build+4  7iv7 ,tax-exempt use prop]ty   
,any exp5diture 9 connection ) !        
conv]sion ( a build+ :i* is allocable to
 ! portion ( su* prop]ty :i* is 7or may 
reasonably be expect$ to be7 tax-exempt 
use prop]ty 7)9 ! mean+ ( section       
#afh7;h771 except t-- 7,i7 #ej p]c5t    
%all be sub/itut$ = #ce p]c5t 9 p>agraph
 7#a77;,b77iii7 !re(1 &  7,,ii7 an      
eligible educational in/itution 7z def9$
 9 section #ebi7;e77#e77 %all n be      
treat$ z a tax-exempt entity4  ,?is     
clause %all n apply = purposes ( det]m9+
 :e!r a build+ has be5 sub/antially     
conv]t$4  7v7 ,exp5ditures ( lessee ,any

 exp5diture ( a lessee ( a build+ if1 on
 ! date ! conv]sion is complet$1 !      
rema9+ t]m ( ! lease 7det]m9$ )\t reg>d 
to any r5ewal p]iods7 is less ?an !     
recov]y p]iod det]m9$ "u section        
#afh7;c74  7f7 ,progress exp5ditures    
7#a7 ,9 g5]al ,9 ! case ( any build+ to 
:i* ?is subsection applies1 except z    
provid$ 9 p>agraph 7#c7-- 7,a7 if su*   
build+ is self-conv]t$ prop]ty1 any     
qualifi$ conv]sion exp5diture ) respect 
to su* build+ %all be tak5 into acc\nt =
 ! taxable ye> = :i* su* exp5diture is  
prop]ly *>geable to capital acc\nt )    
respect to su* build+1 &  7,b7 if su*   
build+ is n self-conv]t$ prop]ty1 any   
qualifi$ conv]sion exp5diture ) respect 
to su* build+ %all be tak5 into acc\nt =
 ! taxable ye> 9 :i* paid4  7#b7        
,prop]ty to :i* subsection applies  7,a7
 ,9 g5]al ,?is subsection %all apply to 
any build+ :i* is be+ conv]t$ by or = ! 
taxpay] if-- 7i7 ! normal conv]sion     
p]iod = su* build+ is #b ye>s or m1 &   
7ii7 x is reasonable to expect t su*    

build+ w be a qualifi$ conv]t$ build+ 9 
! h&s ( ! taxpay] :5 x is plac$ 9       
s]vice4  ,clauses 7i7 & 7ii7 %all be    
appli$ on ! basis ( facts kn[n z ( !    
close ( ! taxable ye> ( ! taxpay] 9 :i* 
! conv]sion beg9s 7or1 if lat]1 at !    
close ( ! fir/ taxable ye> to :i* an    
election "u ?is subsection applies74    
7,b7 ,normal conv]sion p]iod ,= purposes
 ( subp>agraph 7,a71 ! t]m normal       
conv]sion p]iod means ! p]iod reasonably
 expect$ to be requir$ = ! conv]sion ( !
 build+-- 7i7 beg9n+ ) ! date on :i*    
physical "w on ! conv]sion beg9s 7or1 if
 lat]1 ! fir/ day ( ! fir/ taxable ye>  
to :i* an election "u ?is subsection    
applies71 &  7ii7 end+ on ! date on :i* 
x is expect$ t ! prop]ty w be available 
= plac+ 9 s]vice4  7#c7 ,special rules =
 apply+ p>agraph 7#a7 ,= purposes (     
p>agraph 7#a7-- 7,a7 ,compon5t p>ts1 etc
 ,prop]ty :i* is to be a compon5t "p (1 
or is o!rwise to be includ$ 91 any      
build+ to :i* ?is subsection applies    
%all be tak5 into acc\nt-- 7i7 at a "t n

 e>li] ?an ! "t at :i* x becomes        
irrevocably devot$ to use 9 ! build+1 & 
7ii7 z if 7at ! "t ref]r$ to 9 clause   
7i77 ! taxpay] _h exp5d$ an am\nt equal 
to t portion ( ! co/ to ! taxpay] ( su* 
compon5t or o!r prop]ty :i*1 = purposes 
( ?is subp>t1 is prop]ly *>geable 7dur+ 
su* taxable ye>7 to capital acc\nt )    
respect to su* build+4  7,b7 ,c]ta9     
borr[+ disreg>d$ ,any am\nt borr[$      
directly or indirectly by ! taxpay] f ! 
p]son conv]t+ ! prop]ty = him %all n be 
treat$ z an am\nt exp5d$ = su*          
conv]sion4  7,c7 ,limitation = build+s  
:i* are n self-conv]t$  7i7 ,9 g5]al ,9 
! case ( a build+ :i* is n self-conv]t$1
 ! am\nt tak5 into acc\nt "u p>agraph   
7#a77;,b7 = any taxable ye> %all n exce$
 ! am\nt :i* repres5ts ! portion ( !    
ov]all co/ to ! taxpay] ( ! conv]sion   
:i* is prop]ly attributable to ! portion
 ( ! conv]sion :i* is complet$ dur+ su* 
taxable ye>4  7ii7 ,c>ryov] ( c]ta9     
am\nts ,9 ! case ( a build+ :i* is n a  
self-conv]t$ build+1 if = ! taxable     

ye>-- 7,i7 ! am\nt :i* 7b = clause 7i77 
w\ld h be5 tak5 into acc\nt "u p>agraph 
7#a77;,b7 exce$s ! limitation ( clause  
7i71 !n ! am\nt ( su* excess %all be    
tak5 into acc\nt "u p>agraph 7#a77;,b7 =
 ! succe$+ taxable ye>1 or  7,,ii7 !    
limitation ( clause 7i7 exce$s ! am\nt  
tak5 into acc\nt "u p>agraph 7#a77;,b71 
!n ! am\nt ( su* excess %all increase ! 
limitation ( clause 7i7 = ! succe$+     
taxable ye>4  7,d7 ,det]m9ation (       
p]c5tage ( completion ,! det]m9ation "u 
subp>agraph 7,c77i7 ( ! portion ( !     
ov]all co/ to ! taxpay] ( ! conv]sion   
:i* is prop]ly attributable to conv]sion
 complet$ dur+ any taxable ye> %all be  
made1 "u regulations prescrib$ by !     
,secret>y1 on ! basis ( eng9e]+ or      
ar*itectural e/imates or on ! basis (   
co/ acc\nt+ records4 ,unless ! taxpay]  
e/abli%es o!rwise by cle> & conv9c+     
evid5ce1 ! conv]sion %all be deem$ to be
 complet$ n m rapidly ?an ratably ov] ! 
normal conv]sion p]iod4  7,e7 ,no       
progress exp5ditures = c]ta9 prior      

p]iods ,no qualifi$ conv]sion           
exp5ditures %all be tak5 into acc\nt "u 
?is subsection = any p]iod be=e ! fir/  
day ( ! fir/ taxable ye> to :i* an      
election "u ?is subsection applies4     
7,f7 ,no progress exp5ditures = prop]ty 
= ye> x is plac$ 9 s]vice1 etc ,9 ! case
 ( any build+1 no qualifi$ conv]sion    
exp5ditures %all be tak5 into acc\nt "u 
?is subsection = ! e>li] (-- 7i7 !      
taxable ye> 9 :i* ! build+ is plac$ 9   
s]vice1 or  7ii7 ! fir/ taxable ye> =   
:i* recapture is requir$ "u section     
#ej7;a77#b7 ) respect to su* prop]ty1   
or = any taxable ye> !reaft]4  7#d7     
,self-conv]t$ build+ ,= purposes ( ?is  
subsection1 ! t]m self-conv]t$ build+   
means any build+ if x is reasonable to  
believe t m ?an half ( ! qualifi$       
conv]sion exp5ditures = su* build+ w be 
made directly by ! taxpay]4  7#e7       
,election ,?is subsection %all apply to 
any taxpay] only if su* taxpay] has made
 an election "u ?is p>agraph4 ,su* an   
election %all apply to ! taxable ye> =  

:i* made & all subsequ5t taxable ye>s4  
,su* an election1 once made1 may be     
revok$ only ) ! cons5t ( ! ,secret>y4   
7g7 ,d5ial ( d\ble b5efit ,a cr$it %all 
n be all[$ "u ?is section = any qualifi$
 conv]sion exp5diture = :i* a cr$it is  
all[$ "u section #db or #dg4  4  7c7    
,con=m+ am5dm5ts  7#a7 ,section         
#di7;a77#a77;,c7 ( ! ,int]nal ,rev5ue   
,code ( #aihf is am5d$ by /rik+ & at !  
end ( clause 7vii71 by /rik+ ! p]iod at 
! end ( clause 7viii7 & ins]t+ 1 &1 & by
 add+ aft] clause 7viii7 ! foll[+ new   
clause3  7ix7 ! portion ( ! basis ( any 
qualifi$ conv]t$ prop]ty attributable to
 qualifi$ conv]sion exp5ditures "u      
section #dh;,f4  4  7#b7 ,section       
#ej7;a77#b77;,e7 ( su* ,code is am5d$ by
 /rik+ or #dh;,e7e7 & ins]t+ #dh;,e7e71 
or #dh;,f7e74  7#c7 ,section #ej7;b77#b7
 ( su* ,code is am5d$ by /rik+ & at !   
end ( subp>agraph 7,c71 by /rik+ ! p]iod
 at ! end ( subp>agraph 7,d7 & ins]t+ 2 
&1 & by add+ aft] subp>agraph 7,d7 !    
foll[+ new subp>agraph3  7,e7 a qualifi$

 conv]t$ build+ to ! ext5t ( t portion (
 ! basis :i* is attributable to qualifi$
 conv]sion exp5ditures4  4  7#d7        
,section #ej7;b77#c7 is am5d$ by ins]t+ 
1 or1 solely ) respect to !             
comm]cial-to-resid5tial cr$it1 an       
eligible educational in/itution 7z def9$
 9 section #ebi7;e77#e77 aft] section   
#eba4  7#e7 ,! table ( sections = subp>t
 ,e ( "p ,,iv ( sub*apt] ,a ( *apt] #a (
 su* ,code is am5d$ by ins]t+ aft] !    
item relat+ to section #dh;,e ! foll[+  
new item3  ,sec4 #dh;,f4                
,comm]cial-to-resid5tial cr$it4  4  7d7 
,effective date ,! am5dm5ts made by ?is 
section %all apply to qualifi$ conv]sion
 exp5ditures incurr$ aft] ! date (      
enactm5t 9 taxable ye>s end+ aft] su*   
date4  #c4 ,comm]cial to resid5tial     
conv]sion advisory bo>d  7a7 ,e/abli%m5t
 ,n lat] ?an #a ye> aft] ! date ( !     
enactm5t ( ?is ,act1 ! ,secret>y ( ,h\s+
 & ,urban ,developm5t %all e/abli% an   
advisory bo>d to c>ry out ! duties      
describ$ 9 subsection 7c74  7b7         

,memb]%ip ,! advisory bo>d %all be      
compos$ ( n less ?an #bj memb]s1 appo9t$
 by ! ,secret>y4  7c7 ,duties ,!        
advisory bo>d %all provide logi/ical    
support1 te*nical assi/ance1 be/        
practices1 & tra9+ to ,/ate & local h\s+
 ag5cies ) respect to-- 7#a7 id5tify+ ! 
be/ c&idates = comm]cial to resid5tial  
conv]sions t are f9ancially &           
logi/ically feasible & meet demon/rat$  
h\s+ dem& 9 localities )9 ! ,/ate or    
locality2  7#b7 conduct+ floor plan &   
feasibility analyses = prospective      
comm]cial to resid5tial conv]sions2     
7#c7 exp$it+ ,/ate or local regulatory  
processes & p]mitt+ processes to all[ = 
fa/] approval & con/ruction ( comm]cial 
to resid5tial conv]sions2  7#d7 re=m+ ( 
local regulatory & zon+ b>ri]s to all[ =
 m comm]cial to resid5tial conv]sions2 &
  7#e7 id5tify+ ,f$]al & ,/ate fund+    
s\rces t c be us$ by localities to      
provide f9ancial assi/ance on comm]cial 
to resid5tial conv]sion projects4  7d7  
,au?orization ( appropriations ,!re is  

au?oriz$ to be appropriat$ to c>ry out  
?is section #e1jjj1jjj = ea* ( fiscal   
ye>s #bjbe ?r\gh #bjbi4