I 108th CONGRESS 2d Session H. R. 4096 IN THE HOUSE OF REPRESENTATIVES March 31, 2004 Mr. Sensenbrenner (for himself and Mr. Meehan) 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 expand the incentives for renewal communities.

1.

Short title

This Act may be cited as &short-title1;.

2.

Expansion of tax incentives for renewal communities

(a)

Employment credit allowed for employees residing in any renewal community

Subsection (b) of section 1400H of the Internal Revenue Code of 1986 (relating to modification) is amended by striking and at the end of paragraph (1), by striking the period at the end of paragraph (2) and inserting , and, and by inserting after paragraph (2) the following new paragraph: (3)subsection (d)(1)(B) thereof shall be applied by substituting within any for within such.. (b)

Public service cap exemption

(1)

In general

Part III of subchapter X of chapter 1 of such Code (relating to additional incentives) is amended by adding at the end the following new section:

1400K.

Public service cap exemption

In the case of an area designated as a renewal community which was an enterprise community, the same exemption from the percentage limitation under section 105(a)(8) of the Housing and Community Development Act of 1974 on the use of community development block grants for provision of public services that applied to such enterprise community shall apply to the renewal community.

. (2)

Clerical amendment

The table of sections for Part III of subchapter X of chapter 1 of such Code is amended by adding at the end the following new item: Sec. 1400K. Public service cap exemption. (c)

Expansion of renewal community to include adjacent areas of high economic distress and certain noncontiguous parcels

Subsection (a) of section 1400E of such Code is amended by adding at the end the following new paragraph: (6)

Expansion of designated areas

(A)

In general

The Secretary of Housing and Urban Development may expand the boundaries of any area designated as a renewal community to include— (i)any census tract or census block group adjacent to the renewal community which the Secretary of Housing and Urban Development determines is an area of high economic distress, (ii)any census tract or census block group adjacent to the renewal community if not less than 50 percent of such tract or group is non-residential, or (iii)any census tract or census block group which is noncontiguous to the renewal community (determined without regard to this paragraph) if not less than 50 percent of such tract or group is non-residential. (B)

Limitation on number of parcels

Subparagraph (A)(iii) shall not apply to more than 5 parcels with respect to any renewal community. (C)

Period for which designation is in effect

Any expansion of a renewal community under this paragraph shall be effective on the date designated by the Secretary of Housing and Urban Development and shall continue in effect thereafter as part of such renewal community.. (d)

Effective date

The amendments made by this section shall apply to years beginning after the date of the enactment of this Act.