[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1574 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 1574

    To permit national banks to underwrite municipal revenue bonds.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 31, 1993

 Mrs. Maloney introduced the following bill; which was referred to the 
            Committee on Banking, Finance and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
    To permit national banks to underwrite municipal revenue bonds.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. FINDINGS AND PURPOSES.

    (a) Findings.--The Congress finds that--
            (1) State and local governments presently have few 
        available options for raising funds for local improvement 
        projects; and
            (2) this lack of options results in higher borrowing rates 
        for State and local governments when funds are needed for local 
        improvement projects.
    (b) Purposes.--The purposes of this Act are--
            (1) to permit national banks to underwrite municipal 
        revenue bonds to provide for enhanced financial services for 
        State and local governments; and
            (2) to encourage municipalities to utilize local resources 
        to finance improvement projects in an effort to reduce the 
        overall cost to the taxpayer of such projects.

SEC. 2. MUNICIPAL REVENUE BOND UNDERWRITING.

    The paragraph designated the ``Seventh'' of section 5136 of the 
Revised Statutes (12 U.S.C. 24) is amended by adding at the end the 
following new paragraph:
    ``The limitations and restrictions in this section pertaining to 
dealing in, underwriting, and purchasing securities for a national 
bank's own account shall not apply to any obligation issued by or on 
behalf of any State, the District of Columbia, any territory or 
possession of the United States, or any political subdivision, agency, 
or instrumentality of any such State, District, territory, or 
possession. Notwithstanding the preceding sentence, such limitations 
and restrictions shall apply to a private activity bond (as defined in 
section 141 of the Internal Revenue Code of 1986) unless--
            ``(1) a State, the District of Columbia, or a territory or 
        possession of the United States, or any political subdivision 
        of any such State, District, territory, or possession, pledges 
        its full faith and credit for payment of the entire principal 
        of and interest on such bond; or
            ``(2) the interest on such bond is excluded from gross 
        income under section 103(a) of the Internal Revenue Code of 
        1986, and the issuer, or the governmental unit on behalf of 
        which such bond was issued, is the sole owner, for Federal 
        income tax purposes, of the facility to be financed from the 
        proceeds of such bond.
For purposes of the preceding sentence, any bond described in section 
1312(c)(2) of the Tax Reform Act of 1986 to which section 141(a) of the 
Internal Revenue Code of 1986 does not apply (by reason of section 
1311, 1312, or 1313 of such Act), shall not be treated as a private 
activity bond.''.

                                 <all>