[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3309 Introduced in House (IH)]







106th CONGRESS
  1st Session
                                H. R. 3309

   To amend the Internal Revenue Code of 1986 to modify the private 
  activity bond rules to deter unwarranted hostile takeovers of water 
                               utilities.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 10, 1999

  Mr. Crane introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code of 1986 to modify the private 
  activity bond rules to deter unwarranted hostile takeovers of water 
                               utilities.

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

SECTION 1. MODIFICATION TO PRIVATE ACTIVITY BOND RULES.

    (a) Acquisitions of Water Utilities.--Subsection (d) of section 141 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new paragraph:
            ``(7) Acquisitions of water utilities.--
                    ``(A) In general.--For purposes of this title, the 
                term `private activity bond' includes any bond issued 
                as part of an issue if any portion of the proceeds of 
                the issue are to be used (directly or indirectly) for 
                the acquisition of a water utility (or any facility 
                thereof) by a governmental unit through exercise of 
                eminent domain powers.
                    ``(B) Acquisition through exercise of eminent 
                domain.--For purposes of this paragraph, the exercise 
                of eminent domain powers includes acquisition through 
                seizure, requisition, or condemnation, or threat of 
                imminence thereof.
                    ``(C) Exceptions.--Subparagraph (A) shall not apply 
                to any bonds issued--
                            ``(i) pursuant to 1 or more public 
                        referendums approving such bond issuance and 
                        the acquisition of the water utility (or 
                        facility) through exercise of eminent domain, 
                        or
                            ``(ii) pursuant to a finding by a State 
                        public utility commission that the water 
                        utility on a continued basis has been in 
                        violation of State or Federal laws or 
                        regulations governing the provision of water 
                        services.
                    ``(D) Denial of exempt facility bond exception.--
                Section 142(a)(4) shall not apply to any bond which is 
                a private activity bond by reason of this paragraph.''
    (b) Effective Date.--The amendment made by this section shall apply 
to obligations issued after the date of the enactment of this Act.
                                 <all>