[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1767 Introduced in House (IH)]







106th CONGRESS
  1st Session
                                H. R. 1767

To amend the Elementary and Secondary Education Act of 1965 to provide 
  for the allocation of any limitation imposed on school construction 
bonds with respect to which the holders are allowed a credit under the 
 Internal Revenue Code of 1986, and to apply the wage requirements of 
       the Davis-Bacon Act to projects financed with such bonds.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 12, 1999

 Mr. Andrews introduced the following bill; which was referred to the 
                Committee on Education and the Workforce

_______________________________________________________________________

                                 A BILL


 
To amend the Elementary and Secondary Education Act of 1965 to provide 
  for the allocation of any limitation imposed on school construction 
bonds with respect to which the holders are allowed a credit under the 
 Internal Revenue Code of 1986, and to apply the wage requirements of 
       the Davis-Bacon Act to projects financed with such bonds.

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

SECTION 1. ALLOCATION OF NATIONAL LIMITATION ON QUALIFIED SCHOOL 
              CONSTRUCTION BONDS; APPLICATION OF DAVIS-BACON ACT TO 
              PROJECTS FINANCED WITH BONDS.

    (a) In General.--Title XII of the Elementary and Secondary 
Education Act of 1965 (20 U.S.C. 8501 et seq.) is amended--
            (1) by redesignating sections 12004 through 12013 as 
        sections 12101 through 12110, respectively;
            (2) by inserting before section 12101 (as so redesignated) 
        the following:

  ``PART A--GRANTS FOR IMPROVEMENT OF PUBLIC ELEMENTARY AND SECONDARY 
                        EDUCATION FACILITIES'';

        and
            (3) by adding at the end the following:

             ``PART B--QUALIFIED SCHOOL CONSTRUCTION BONDS

``SEC. 12201. ALLOCATION WITH RESPECT TO QUALIFIED SCHOOL CONSTRUCTION 
              BONDS.

    ``(a) Qualified School Construction Bond.--
            ``(1) In general.--For purposes of this part, the term 
        `qualified school construction bond' means any bond issued as 
        part of an issue if--
                    ``(A) a taxpayer who holds the bond is allowed a 
                credit under the Internal Revenue Code of 1986;
                    ``(B) 95 percent or more of the proceeds of such 
                issue are to be used for the construction, 
                rehabilitation, or repair of a public school facility;
                    ``(C) the bond is issued by a State or local 
                government within the jurisdiction of which such school 
                is located; and
                    ``(D) the issuer designates such bond for purposes 
                of this section and the Internal Revenue Code of 1986.
            ``(2) Temporary period exception.--A bond shall not be 
        treated as failing to meet the requirement of paragraph (1)(B) 
        solely by reason of the fact that the proceeds of the issue of 
        which such bond is a part are invested for a reasonable 
        temporary period (but not more than 36 months) until such 
        proceeds are needed for the purpose for which such issue was 
        issued. Any earnings on such proceeds during such period shall 
        be treated as proceeds of the issue for purposes of applying 
        paragraph (1)(B).
    ``(b) National Limitation on Amount of Bonds Designated.--In any 
case in which there is imposed a national limitation on the maximum 
aggregate face amount of bonds issued during any calendar year which 
may be designated as qualified school construction bonds, such 
limitation shall be allocated in accordance with this section.
    ``(c) One-Third of Limitation Allocated Among States.--
            ``(1) In general.--One-third of the limitation applicable 
        under subsection (b) for any calendar year shall be allocated 
        among the States under paragraph (2) by the Secretary. The 
        limitation amount allocated to a State under the preceding 
        sentence shall be allocated by the State educational agency to 
        issuers within such State and such allocations may be made only 
        if there is an approved State application.
            ``(2) Allocation formula.--The amount to be allocated under 
        paragraph (1) for any calendar year shall be allocated among 
        the States in proportion to the respective amounts each such 
        State received for Basic Grants under subpart 2 of part A of 
        title I of this Act for the most recent fiscal year ending 
        before such calendar year. For purposes of the preceding 
        sentence, Basic Grants attributable to large local educational 
        agencies (as defined in subsection (d)), and Basic Grants 
        attributable to high-growth local educational agencies (as 
        defined in subsection (e)), shall be disregarded.
            ``(3) Minimum allocations to states.--
                    ``(A) In general.--The Secretary shall adjust the 
                allocations under this subsection for any calendar year 
                for each State to the extent necessary to ensure that 
                the sum of--
                            ``(i) the amount allocated to such State 
                        under this subsection for such year; and
                            ``(ii) the aggregate amounts allocated 
                        under subsections (d) and (e) to local 
                        educational agencies in such State for such 
                        year;
                is not less than an amount equal to such State's 
                minimum percentage of one-third of the national 
                qualified school construction bond limitation referred 
                to in subsection (b) for the calendar year.
                    ``(B) Minimum percentage.--A State's minimum 
                percentage for any calendar year is the minimum 
                percentage described in section 1124(d) for such State 
                for the most recent fiscal year ending before such 
                calendar year.
            ``(4) Allocations to certain possessions.--The amount to be 
        allocated under paragraph (1) to any possession of the United 
        States (as such term is used in the Internal Revenue Code of 
        1986) other than Puerto Rico shall be the amount which would 
        have been allocated if all allocations under paragraph (1) were 
        made on the basis of respective populations of individuals 
        below the poverty line (as defined by the Office of Management 
        and Budget). In making other allocations, the amount to be 
        allocated under paragraph (1) shall be reduced by the aggregate 
        amount allocated under this paragraph to possessions of the 
        United States.
            ``(5) Approved state application.--For purposes of 
        paragraph (1), the term `approved State application' means an 
        application which is approved by the Secretary and which 
        includes--
                    ``(A) the results of a recent publicly available 
                survey (undertaken by the State with the involvement of 
                local education officials, members of the public, and 
                experts in school construction and management) of such 
                State's needs for public school facilities, including 
                descriptions of--
                            ``(i) health and safety problems at such 
                        facilities;
                            ``(ii) the capacity of public schools in 
                        the State to house projected enrollments; and
                            ``(iii) the extent to which the public 
                        schools in the State offer the physical 
                        infrastructure needed to provide a high-quality 
                        education to all students; and
                    ``(B) a description of how the State will allocate 
                to local educational agencies, or otherwise use, its 
                allocation under this subsection to address the needs 
                identified under subparagraph (A), including a 
                description of how it will--
                            ``(i) give highest priority to localities 
                        with the greatest needs, as demonstrated by 
                        inadequate school facilities coupled with a low 
                        level of resources to meet those needs;
                            ``(ii) use its allocation under this 
                        subsection to assist localities that lack the 
                        fiscal capacity to issue bonds on their own; 
                        and
                            ``(iii) ensure that its allocation under 
                        this subsection is used only to supplement, and 
                        not supplant, the amount of school 
                        construction, rehabilitation, and repair in the 
                        State that would have occurred in the absence 
                        of such allocation.
        Any allocation under paragraph (1) by a State education agency 
        shall be binding if such agency reasonably determined that the 
        allocation was in accordance with the plan approved under this 
        paragraph.
    ``(d) One-Third of Limitation Allocated Among Largest School 
Districts.--
            ``(1) In general.--One-third of the limitation applicable 
        under subsection (b) for any calendar year shall be allocated 
        under paragraph (2) by the Secretary among local educational 
        agencies which are large local educational agencies for such 
        year. No qualified school construction bond may be issued by 
        reason of an allocation to a large local educational agency 
        under the preceding sentence unless such agency has an approved 
        local application.
            ``(2) Allocation formula.--The amount to be allocated under 
        paragraph (1) for any calendar year shall be allocated among 
large local educational agencies in proportion to the respective 
amounts each such agency received for Basic Grants under subpart 2 of 
part A of title I of this Act for the most recent fiscal year ending 
before such calendar year.
            ``(3) Large local educational agency.--For purposes of this 
        section, the term `large local educational agency' means, with 
        respect to a calendar year, any local educational agency (other 
        than a high-growth local educational agency, as defined in 
        subsection (e)) if such agency is--
                    ``(A) among the 100 local educational agencies with 
                the largest numbers of children aged 5 through 17 from 
                families living below the poverty level, as determined 
                by the Secretary using the most recent data available 
                from the Department of Commerce that are satisfactory 
                to the Secretary; or
                    ``(B) 1 of not more than 25 local educational 
                agencies (other than those described in clause (i)) 
                that the Secretary determines (based on the most recent 
                data available satisfactory to the Secretary) are in 
                particular need of assistance, based on a low level of 
                resources for school construction, a high level of 
                enrollment growth, or such other factors as the 
                Secretary deems appropriate.
            ``(4) Approved local application.--For purposes of 
        paragraph (1), the term `approved local application' means an 
        application which is approved by the Secretary and which 
        includes--
                    ``(A) the results of a recent publicly-available 
                survey (undertaken by the local educational agency with 
                the involvement of school officials, members of the 
                public, and experts in school construction and 
                management) of such agency's needs for public school 
                facilities, including descriptions of--
                            ``(i) the overall condition of the local 
                        educational agency's school facilities, 
                        including health and safety problems;
                            ``(ii) the capacity of the agency's schools 
                        to house projected enrollments; and
                            ``(iii) the extent to which the agency's 
                        schools offer the physical infrastructure 
                        needed to provide a high-quality education to 
                        all students;
                    ``(B) a description of how the local educational 
                agency will use its allocation under this subsection to 
                address the needs identified under subparagraph (A); 
                and
                    ``(C) a description of how the local educational 
                agency will ensure that its allocation under this 
                subsection is used only to supplement, and not 
                supplant, the amount of school construction, 
                rehabilitation, or repair in the locality that would 
                have occurred in the absence of such allocation.
        A rule similar to the rule of the last sentence of subsection 
        (c)(5) shall apply for purposes of this subsection.
    ``(e) One-Third of Limitation Allocated Among High-Growth School 
Districts.--
            ``(1) In general.--One-third of the limitation applicable 
        under subsection (b) for any calendar year shall be allocated 
        under paragraph (2) by the Secretary among local educational 
        agencies which are high-growth local educational agencies for 
        such year. No qualified school construction bond may be issued 
        by reason of an allocation to a high-growth local educational 
        agency under the preceding sentence unless such agency has an 
        approved local application (as defined in subsection (d)(4)). A 
        rule similar to the rule of the last sentence of subsection 
        (c)(5) shall apply for purposes of this subsection.
            ``(2) Allocation formula.--The amount to be allocated under 
        paragraph (1) for any calendar year shall be allocated among 
        high-growth local educational agencies in proportion to the 
        respective amounts each such agency received for Basic Grants 
        under subpart 2 of part A of title I of this Act for the most 
        recent fiscal year ending before such calendar year.
            ``(3) High-growth local educational agency.--For purposes 
        of this section, the term `high-growth local educational 
        agency' means, with respect to a calendar year, any local 
        educational agency if--
                    ``(A) there has been at least a 7.5 percent 
                increase in such agency's enrollment during the 5-year 
                period ending with the preceding calendar year; and
                    ``(B) such enrollment increase exceeds 150 
                students.
    ``(f) Carryover of Unused Limitation.--If for any calendar year--
            ``(1) the amount allocated under subsection (c) to any 
        State; exceeds
            ``(2) the amount of bonds issued during such year which are 
        designated as qualified school construction bonds pursuant to 
        such allocation;
the limitation amount under such subsection for such State for the 
following calendar year shall be increased by the amount of such 
excess. A similar rule shall apply to the amounts allocated under 
subsections (d) and (e).
    ``(g) Other Definitions.--For purposes of this section:
            ``(1) Local educational agency.--The term `local 
        educational agency' has the meaning given to such term by 
        section 14101. Such term includes the local educational agency 
        that serves the District of Columbia but does not include any 
        other State agency.
            ``(2) Bond.--The term `bond' includes any obligation.
            ``(3) Public school facility.--The term `public school 
        facility' shall not include any stadium or other facility 
        primarily used for athletic contests or exhibitions or other 
        events for which admission is charged to the general public.

``SEC. 12202. APPLICATION OF DAVIS-BACON ACT TO PROJECTS FINANCED WITH 
              QUALIFIED SCHOOL CONSTRUCTION BONDS.

    ``The wage requirements of the Act of March 3, 1931 (40 U.S.C. 276a 
et seq.) (commonly referred to as the `Davis-Bacon Act') shall apply 
with respect to individuals employed on school construction, 
rehabilitation, or repair projects financed with the proceeds from an 
issuance of qualified school construction bonds.''.
    (b) Conforming Amendments.--Title XII of such Act is amended--
            (1) in sections 12101 through 12110 (as so redesignated), 
        by striking ``this title'' each place it appears and inserting 
        ``this part'';
            (2) in section 12101(a)(1) (as so redesignated)--
                    (A) by striking ``section 12013'' and inserting 
                ``section 12110'';
                    (B) by striking ``section 12005'' and inserting 
                ``section 12102''; and
                    (C) by striking ``section 12007'' and inserting 
                ``section 12104'';
            (3) in section 12101(a)(2) (as so redesignated), by 
        striking ``section 12013'' and inserting ``section 12110''; and
            (4) in section 12109(3)(C) (as so redesignated), by 
        striking ``section 12006'' and inserting ``section 12103''.
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