[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1631 Reported in House (RH)]


                                                 Union Calendar No. 201
109th CONGRESS
  2d Session
                                H. R. 1631

                  [Report No. 109-314, Parts I and II]

To provide for the financing of high-speed rail infrastructure, and for 
                            other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 14, 2005

Mr. Young of Alaska (for himself, Mr. Oberstar, Mr. LaTourette, and Ms. 
  Corrine Brown of Florida) introduced the following bill; which was 
referred to the Committee on Transportation and Infrastructure, and in 
    addition to the Committee on Ways and Means, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

                           November 18, 2005

    Reported from the Committee on Transportation and Infrastructure

                           November 18, 2005

   Referral to the Committee on Ways and Means extended for a period 
                ending not later than December 31, 2005

                           December 31, 2005

   Referral to the Committee on Ways and Means extended for a period 
                 ending not later than February 3, 2006

                            February 3, 2006

 Additional sponsors: Mr. Simmons, Ms. Norton, Ms. Millender-McDonald, 
 Mr. Bishop of New York, Mr. Weiner, Mr. Boswell, Mr. Blumenauer, Mr. 
Chandler, Ms. Carson, Mr. Kuhl of New York, Mr. Platts, Mr. Weller, Mr. 
  Gerlach, Mr. Ney, Mr. McHugh, Mr. Davis of Illinois, Mr. Holt, Mr. 
  Honda, Ms. McCollum of Minnesota, Mr. Abercrombie, Mr. Rahall, Ms. 
    Baldwin, Mr. Reyes, Mr. Israel, Mr. Ruppersberger, Mr. Brady of 
Pennsylvania, Mr. Hinchey, Mr. DeFazio, Mrs. Jones of Ohio, Mr. Payne, 
 Mr. Grijalva, Mr. Lewis of Georgia, Mr. Carnahan, Mrs. McCarthy, Mr. 
   Cuellar, Mr. Menendez, Mr. Lipinski, Mr. McNulty, Mr. Matsui, Ms. 
 Berkley, Ms. Woolsey, Mr. Engel, Mr. Baca, Mr. Ackerman, Mr. Lantos, 
 Mr. Rangel, Mr. Pastor, Mr. Moran of Virginia, Mr. Evans, Mr. Doyle, 
Mr. McGovern, Mr. Kildee, Mr. LoBiondo, Mr. Pomeroy, Mr. Brown of Ohio, 
  Mr. McIntyre, Mr. Pallone, Mr. Lynch, Mr. Boucher, Mr. Michaud, Mr. 
 Miller of North Carolina, Mr. Gutierrez, Mr. Schwarz of Michigan, Mr. 
  Filner, Mr. Butterfield, Mr. Wexler, Mr. Larsen of Washington, Mr. 
      Cummings, Ms. Linda T. Sanchez of California, and Mr. Costa

                            February 3, 2006

   Reported from the Committee on Ways and Means with an amendment, 
   committed to the Committee of the Whole House on the State of the 
                    Union, and ordered to be printed
  [Omit the part struck through and insert the part printed in italic]

_______________________________________________________________________

                                 A BILL


 
To provide for the financing of high-speed rail infrastructure, and for 
                            other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Rail Infrastructure Development and 
Expansion Act for the 21st Century''.

<DELETED>SEC. 2. HIGH-SPEED INTERCITY RAIL FACILITY BONDS.</DELETED>

<DELETED>    (a) Amendment.--Chapter 261 of title 49, United States 
Code, is amended by adding at the end the following new 
section:</DELETED>
<DELETED>``Sec. 26106. High-speed rail infrastructure bonds</DELETED>
<DELETED>    ``(a) Designation.--The Secretary may designate bonds for 
purposes of subsection (f) or section 54 of the Internal Revenue Code 
of 1986 if--</DELETED>
        <DELETED>    ``(1) the bonds are to be issued by--</DELETED>
                <DELETED>    ``(A) a State, if the entire railroad 
                passenger transportation corridor containing the 
                infrastructure project to be financed is within the 
                State;</DELETED>
                <DELETED>    ``(B) 1 or more of the States that have 
                entered into an agreement or an interstate compact 
                consented to by Congress under section 410(a) of Public 
                Law 105-134 (49 U.S.C 24101 nt); or</DELETED>
                <DELETED>    ``(C) an agreement or an interstate 
                compact described in subparagraph (B);</DELETED>
        <DELETED>    ``(2) the bonds are for the purpose of financing--
        </DELETED>
                <DELETED>    ``(A) projects that make a substantial 
                contribution to providing the infrastructure and 
                equipment required to complete a high-speed rail 
                transportation corridor (including projects for the 
                acquisition, financing, or refinancing of equipment and 
                other capital improvements, including the introduction 
                of new high-speed technologies such as magnetic 
                levitation systems, track or signal improvements, the 
                elimination of grade crossings, development of 
                intermodal facilities, improvement of train speeds or 
                safety, or both, and station rehabilitation or 
                construction), but only if the Secretary determines 
                that the projects are part of a viable and 
                comprehensive high-speed rail transportation corridor 
                design for intercity passenger service, including a 
                design for minimally operable segments of a corridor 
                designated under section 104(d)(2) of title 23, United 
                States Code; or</DELETED>
                <DELETED>    ``(B) projects for the Alaska 
                Railroad;</DELETED>
        <DELETED>    ``(3) for a railroad passenger transportation 
        corridor design that includes the use of rights-of-way owned by 
        a freight railroad, a written agreement exists between the 
        applicant and the freight railroad regarding such use and 
        ownership, including compensation for such use and assurances 
        regarding the adequacy of infrastructure capacity to 
        accommodate both existing and future freight and passenger 
        operations, and including an assurance by the freight railroad 
        that collective bargaining agreements with the freight 
        railroad's employees (including terms regulating the 
        contracting of work) shall remain in full force and effect 
        according to their terms for work performed by the freight 
        railroad on such railroad passenger transportation 
        corridor;</DELETED>
        <DELETED>    ``(4) the corridor design eliminates existing 
        railway-highway grade crossings that the Secretary determines 
        would impede high-speed rail operations;</DELETED>
        <DELETED>    ``(5) the applicant agrees to comply with--
        </DELETED>
                <DELETED>    ``(A) the standards of section 24312, as 
                in effect on September 1, 2002, with respect to the 
                project in the same manner that the National Railroad 
                Passenger Corporation is required to comply with such 
                standards for construction work financed under an 
                agreement made under section 24308(a); and</DELETED>
                <DELETED>    ``(B) the protective arrangements 
                established under section 504 of the Railroad 
                Revitalization and Regulatory Reform Act of 1976 (45 
                U.S.C. 836) with respect to employees affected by 
                actions taken in connection with the project to be 
                financed by the bond; and</DELETED>
        <DELETED>    ``(6) the applicant agrees not to pay the 
        principal or interest on the bonds using funds derived directly 
        or indirectly from the Highway Trust Fund, except as permitted 
        by law as of the date of the enactment of this 
        section.</DELETED>
<DELETED>    ``(b) Bond Amount Limitation.--</DELETED>
        <DELETED>    ``(1) In general.--The amount of bonds designated 
        under this section may not exceed--</DELETED>
                <DELETED>    ``(A) in the case of subsection (f) bonds, 
                $1,200,000,000 for each of the fiscal years 2006 
                through 2015; and</DELETED>
                <DELETED>    ``(B) in the case of section 54 bonds, 
                $1,200,000,000 for each of the fiscal years 2006 
                through 2015.</DELETED>
        <DELETED>    ``(2) Carryover of unused limitation.--If for any 
        fiscal year the limitation amount under subparagraph (A) or (B) 
        of paragraph (1) exceeds--</DELETED>
                <DELETED>    ``(A) with respect to subparagraph (A) of 
                paragraph (1), the amount of subsection (f) bonds 
                issued during such year; or</DELETED>
                <DELETED>    ``(B) with respect to subparagraph (B) of 
                paragraph (1), the amount of section 54 bonds issued 
                during such year,</DELETED>
        <DELETED>the limitation amount under subparagraph (A) or (B) of 
        paragraph (1), as the case may be, for the following fiscal 
        year (through fiscal year 2019) shall be increased by the 
        amount of such excess.</DELETED>
<DELETED>    ``(c) Preference.--The Secretary shall give preference to 
the designation under this section of bonds for projects--</DELETED>
        <DELETED>    ``(1) to be funded through a combination of 
        subsection (f) bonds and section 54 bonds;</DELETED>
        <DELETED>    ``(2) which propose to link rail passenger service 
        with other modes of transportation;</DELETED>
        <DELETED>    ``(3) expected to have a significant impact on air 
        traffic congestion;</DELETED>
        <DELETED>    ``(4) expected to also improve commuter rail 
        operations;</DELETED>
        <DELETED>    ``(5) where all environmental work has already 
        been completed and the project is ready to commence; 
        or</DELETED>
        <DELETED>    ``(6) that have received financial commitments and 
        other support of State and local governments.</DELETED>
<DELETED>    ``(d) Timely Disposition of Application.--The Secretary 
shall grant or deny a requested designation within 9 months after 
receipt of an application.</DELETED>
<DELETED>    ``(e) Annual Reports.--</DELETED>
        <DELETED>    ``(1) From issuer of bonds.--The issuer of bonds 
        designated under subsection (a) shall report annually to the 
        Secretary regarding the terms of outstanding designated bonds 
        and the progress made with respect to the project financed by 
        the bonds.</DELETED>
        <DELETED>    ``(2) From secretary.--The Secretary, in 
        consultation with the Secretary of the Treasury, shall transmit 
        to the Congress an annual report which includes--</DELETED>
                <DELETED>    ``(A) reports received under paragraph 
                (1); and</DELETED>
                <DELETED>    ``(B) an assessment of the progress made 
                toward completion of high-speed rail transportation 
                corridors resulting from projects financed by bonds 
                designated under subsection (a).</DELETED>
<DELETED>    ``(f) Tax Treatment of Subsection (f) Bonds.--</DELETED>
        <DELETED>    ``(1) Exclusion from gross income.--The interest 
        on a bond designated by the Secretary under subsection (a) for 
        purposes of this subsection shall be excluded from gross income 
        under section 103 of the Internal Revenue Code of 1986, 
        notwithstanding section 149(c) of such Code.</DELETED>
        <DELETED>    ``(2) Exemption from volume cap.--For purposes of 
        section 146 of such Code, a bond designated by the Secretary 
        under subsection (a) for purposes of this subsection shall be 
        considered to be exempt from the volume cap of the issuing 
        authority in the same manner as bonds listed in subsection (g) 
        of such section 146.</DELETED>
<DELETED>    ``(g) Refinancing Rules.--Bonds designated by the 
Secretary under subsection (a) may be issued for refinancing projects 
only if the indebtedness being refinanced (including any obligation 
directly or indirectly refinanced by such indebtedness) was originally 
incurred by the issuer--</DELETED>
        <DELETED>    ``(1) after the date of the enactment of this 
        section;</DELETED>
        <DELETED>    ``(2) for a term of not more than 3 
        years;</DELETED>
        <DELETED>    ``(3) to finance projects described in subsection 
        (a)(2); and</DELETED>
        <DELETED>    ``(4) in anticipation of being refinanced with 
        proceeds of a bond designated under subsection (a).</DELETED>
<DELETED>    ``(h) Provisions Regarding High-Speed Rail Service.--
</DELETED>
        <DELETED>    ``(1) Status as employer or carrier.--Any entity 
        providing railroad transportation (within the meaning of 
        section 20102) that begins operations after the date of the 
        enactment of this section and that uses property acquired 
        pursuant to this section (except as provided in subsection 
        (a)(2)(B)), shall be considered an employer for purposes of the 
        Railroad Retirement Act of 1974 (45 U.S.C. 231 et seq.) and 
        considered a carrier for purposes of the Railway Labor Act (45 
        U.S.C. 151 et seq.).</DELETED>
        <DELETED>    ``(2) Collective bargaining agreement.--Any entity 
        providing high-speed intercity passenger railroad 
        transportation (within the meaning of section 20102) that 
        begins operations after the date of enactment of this section 
        on a project funded in whole or in part by bonds designated 
        under subsection (a), and replaces intercity rail passenger 
        service that was provided by another entity as of the date of 
        enactment of this section, shall enter into an agreement with 
        the authorized bargaining agent or agents for employees of the 
        predecessor provider that--</DELETED>
                <DELETED>    ``(A) gives each employee of the 
                predecessor provider priority in hiring according to 
                the employee's seniority on the predecessor provider 
                for each position with the replacing entity that is in 
                the employee's craft or class and is available within 
                three years after the termination of the service being 
                replaced;</DELETED>
                <DELETED>    ``(B) establishes a procedure for 
                notifying such an employee of such positions;</DELETED>
                <DELETED>    ``(C) establishes a procedure for such an 
                employee to apply for such positions; and</DELETED>
                <DELETED>    ``(D) establishes rates of pay, rules, and 
                working conditions.</DELETED>
        <DELETED>    ``(3) Immediate replacement of existing rail 
        passenger service.--</DELETED>
                <DELETED>    ``(A) Negotiations.--If the replacement of 
                preexisting intercity rail passenger service occurs 
                concurrent with or within a reasonable amount of time 
                before the commencement of the replacing entity's high-
                speed rail passenger service, the replacing entity 
                shall give written notice of its plan to replace 
                existing rail passenger service to the authorized 
                collective bargaining agent or agents for the employees 
                of the predecessor provider at least 90 days prior to 
                the date it plans to commence service. Within 5 days 
                after the date of receipt of such written notice, 
                negotiations between the replacing entity and the 
                collective bargaining agent or agents for the employees 
                of the predecessor provider shall commence for the 
                purpose of reaching agreement with respect to all 
                matters set forth in paragraph (2)(A)-(D). The 
                negotiations shall continue for 30 days or until an 
                agreement is reached, whichever is sooner. If at the 
                end of 30 days the parties have not entered into an 
                agreement with respect to all such matters, the 
                unresolved issues shall be submitted for arbitration in 
                accordance with the procedure set forth in subparagraph 
                (B).</DELETED>
                <DELETED>    ``(B) Arbitration.--If an agreement has 
                not been entered into with respect to all matters set 
                forth in paragraph (2)(A)-(D) as provided in 
                subparagraph (A) of this paragraph, the parties shall 
                select an arbitrator. If the parties are unable to 
                agree upon the selection of such arbitrator within 5 
                days, either or both parties shall notify the National 
                Mediation Board, which shall provide a list of seven 
                arbitrators with experience in arbitrating rail labor 
                protection disputes. Within 5 days after such 
                notification, the parties shall alternately strike 
                names from the list until only one name remains, and 
                that person shall serve as the neutral arbitrator. 
                Within 45 days after selection of the arbitrator, the 
                arbitrator shall conduct a hearing on the dispute and 
                shall render a decision with respect to the unresolved 
                issues set forth in paragraph (2)(A)-(D). This decision 
                shall be final, binding, and conclusive upon the 
                parties. The salary and expenses of the arbitrator 
                shall be borne equally by the parties; all other 
                expenses shall be paid by the party incurring 
                them.</DELETED>
                <DELETED>    ``(C) Service commencement.--A replacing 
                entity under this paragraph shall commence service only 
                after an agreement is entered into with respect to the 
                matters set forth in paragraph (2)(A)-(D) or the 
                decision of the arbitrator has been rendered.</DELETED>
        <DELETED>    ``(4) Subsequent replacement of existing rail 
        passenger service.--If the replacement of existing rail 
        passenger service takes place within 3 years after the 
        replacing entity commences high-speed rail passenger service, 
        the replacing entity and the collective bargaining agent or 
        agents for the employees of the predecessor provider shall 
        enter into an agreement with respect to the matters set forth 
        in paragraph (2)(A)-(D). If the parties have not entered into 
        an agreement with respect to all such matters within 60 days 
        after the date on which the replacing entity replaces the 
        predecessor provider, the parties shall select an arbitrator 
        using the procedures set forth in paragraph (3)(B), who shall, 
        within 20 days after the commencement of the arbitration, 
        conduct a hearing and decide all unresolved issues. This 
        decision shall be final, binding, and conclusive upon the 
        parties.</DELETED>
<DELETED>    ``(i) Issuance of Regulations.--Not later than 6 months 
after the date of the enactment of this section, the Secretary shall 
issue regulations for carrying out this section.</DELETED>
<DELETED>    ``(j) Definitions.--For purposes of this section--
</DELETED>
        <DELETED>    ``(1) Subsection (f) bond.--The term `subsection 
        (f) bond' means a bond designated by the Secretary under 
        subsection (a) for purposes of subsection (f).</DELETED>
        <DELETED>    ``(2) Section 54 bond.--The term `section 54 bond' 
        means a bond designated by the Secretary under subsection (a) 
        for purposes of section 54 of the Internal Revenue Code of 1986 
        (relating to credit to holders of qualified high-speed rail 
        infrastructure bonds).''.</DELETED>
<DELETED>    (b) Table of Sections Amendment.--The table of sections of 
chapter 261 of title 49, United States Code, is amended by adding after 
the item relating to section 26105 the following new item:</DELETED>

<DELETED>``26106. High-speed rail infrastructure bonds.''.

<DELETED>SEC. 3. TAX CREDIT TO HOLDERS OF QUALIFIED HIGH-SPEED RAIL 
              INFRASTRUCTURE BONDS.</DELETED>

<DELETED>    (a) In General.--Part IV of subchapter A of chapter 1 of 
the Internal Revenue Code of 1986 (relating to credits against tax) is 
amended by adding at the end the following new subpart:</DELETED>

  <DELETED>``Subpart H--Nonrefundable Credit for Holders of Qualified 
             High-Speed Rail Infrastructure Bonds</DELETED>

<DELETED>``Sec. 54. Credit to holders of qualified high-speed rail 
                            infrastructure bonds.

<DELETED>``SEC. 54. CREDIT TO HOLDERS OF QUALIFIED HIGH-SPEED RAIL 
              INFRASTRUCTURE BONDS.</DELETED>

<DELETED>    ``(a) Allowance of Credit.--In the case of a taxpayer who 
holds a qualified high-speed rail infrastructure bond on a credit 
allowance date of such bond which occurs during the taxable year, there 
shall be allowed as a credit against the tax imposed by this chapter 
for such taxable year an amount equal to the sum of the credits 
determined under subsection (b) with respect to credit allowance dates 
during such year on which the taxpayer holds such bond.</DELETED>
<DELETED>    ``(b) Amount of Credit.--</DELETED>
        <DELETED>    ``(1) In general.--The amount of the credit 
        determined under this subsection with respect to any credit 
        allowance date for a qualified high-speed rail infrastructure 
        bond is 25 percent of the annual credit determined with respect 
        to such bond.</DELETED>
        <DELETED>    ``(2) Annual credit.--The annual credit determined 
        with respect to any qualified high-speed rail infrastructure 
        bond is the product of--</DELETED>
                <DELETED>    ``(A) the applicable credit rate, 
                multiplied by</DELETED>
                <DELETED>    ``(B) the outstanding face amount of the 
                bond.</DELETED>
        <DELETED>    ``(3) Applicable credit rate.--For purposes of 
        paragraph (2), the applicable credit rate with respect to an 
        issue is the rate equal to an average market yield (as of the 
        day before the date of sale of the issue) on outstanding long-
        term corporate debt obligations (determined under regulations 
        prescribed by the Secretary).</DELETED>
        <DELETED>    ``(4) Credit allowance date.--For purposes of this 
        section, the term `credit allowance date' means--</DELETED>
                <DELETED>    ``(A) March 15,</DELETED>
                <DELETED>    ``(B) June 15,</DELETED>
                <DELETED>    ``(C) September 15, and</DELETED>
                <DELETED>    ``(D) December 15.</DELETED>
        <DELETED>Such term includes the last day on which the bond is 
        outstanding.</DELETED>
        <DELETED>    ``(5) Special rule for issuance and redemption.--
        In the case of a bond which is issued during the 3-month period 
        ending on a credit allowance date, the amount of the credit 
        determined under this subsection with respect to such credit 
        allowance date shall be a ratable portion of the credit 
        otherwise determined based on the portion of the 3-month period 
        during which the bond is outstanding. A similar rule shall 
        apply when the bond is redeemed.</DELETED>
<DELETED>    ``(c) Limitation Based on Amount of Tax.--</DELETED>
        <DELETED>    ``(1) In general.--The credit allowed under 
        subsection (a) for any taxable year shall not exceed the excess 
        of--</DELETED>
                <DELETED>    ``(A) the sum of the regular tax liability 
                (as defined in section 26(b)) plus the tax imposed by 
                section 55, over</DELETED>
                <DELETED>    ``(B) the sum of the credits allowable 
                under this part (other than this subpart and subpart 
                C).</DELETED>
        <DELETED>    ``(2) Carryover of unused credit.--If the credit 
        allowable under subsection (a) exceeds the limitation imposed 
        by paragraph (1) for such taxable year, such excess shall be 
        carried to the succeeding taxable year and added to the credit 
        allowable under subsection (a) for such taxable year.</DELETED>
<DELETED>    ``(d) Credit Included in Gross Income.--Gross income 
includes the amount of the credit allowed to the taxpayer under this 
section (determined without regard to subsection (c)) and the amount so 
included shall be treated as interest income.</DELETED>
<DELETED>    ``(e) Qualified High-Speed Rail Infrastructure Bond.--For 
purposes of this part, the term `qualified high-speed rail 
infrastructure bond' means any bond issued as part of an issue if--
</DELETED>
        <DELETED>    ``(1) the issuer certifies that the Secretary of 
        Transportation has designated the bond for purposes of this 
        section under section 26106(a) of title 49, United States Code, 
        as in effect on the date of the enactment of this 
        section,</DELETED>
        <DELETED>    ``(2) 95 percent or more of the proceeds from the 
        sale of such issue are to be used for expenditures incurred 
        after the date of the enactment of this section for any project 
        described in section 26106(a)(2) of title 49, United States 
        Code,</DELETED>
        <DELETED>    ``(3) the term of each bond which is part of such 
        issue does not exceed 20 years,</DELETED>
        <DELETED>    ``(4) the payment of principal with respect to 
        such bond is the obligation solely of the issuer, and</DELETED>
        <DELETED>    ``(5) the issue meets the requirements of 
        subsection (f) (relating to arbitrage).</DELETED>
<DELETED>    ``(f) Special Rules Relating to Arbitrage.--</DELETED>
        <DELETED>    ``(1) In general.--Subject to paragraph (2), an 
        issue shall be treated as meeting the requirements of this 
        subsection if as of the date of issuance, the issuer reasonably 
        expects--</DELETED>
                <DELETED>    ``(A) to spend at least 95 percent of the 
                proceeds from the sale of the issue for 1 or more 
                qualified projects within the 3-year period beginning 
                on such date,</DELETED>
                <DELETED>    ``(B) to incur a binding commitment with a 
                third party to spend at least 10 percent of the 
                proceeds from the sale of the issue, or to commence 
                construction, with respect to such projects within the 
                6-month period beginning on such date, and</DELETED>
                <DELETED>    ``(C) to proceed with due diligence to 
                complete such projects and to spend the proceeds from 
                the sale of the issue.</DELETED>
        <DELETED>    ``(2) Rules regarding continuing compliance after 
        3-year determination.--If at least 95 percent of the proceeds 
        from the sale of the issue is not expended for 1 or more 
        qualified projects within the 3-year period beginning on the 
        date of issuance, but the requirements of paragraph (1) are 
        otherwise met, an issue shall be treated as continuing to meet 
        the requirements of this subsection if either--</DELETED>
                <DELETED>    ``(A) the issuer uses all unspent proceeds 
                from the sale of the issue to redeem bonds of the issue 
                within 90 days after the end of such 3-year period, 
                or</DELETED>
                <DELETED>    ``(B) the following requirements are 
                met:</DELETED>
                        <DELETED>    ``(i) The issuer spends at least 
                        75 percent of the proceeds from the sale of the 
                        issue for 1 or more qualified projects within 
                        the 3-year period beginning on the date of 
                        issuance.</DELETED>
                        <DELETED>    ``(ii) Either--</DELETED>
                                <DELETED>    ``(I) the issuer spends at 
                                least 95 percent of the proceeds from 
                                the sale of the issue for 1 or more 
                                qualified projects within the 4-year 
                                period beginning on the date of 
                                issuance, or</DELETED>
                                <DELETED>    ``(II) the issuer pays to 
                                the Federal Government any earnings on 
                                the proceeds from the sale of the issue 
                                that accrue after the end of the 3-year 
                                period beginning on the date of 
                                issuance and uses all unspent proceeds 
                                from the sale of the issue to redeem 
                                bonds of the issue within 90 days after 
                                the end of the 4-year period beginning 
                                on the date of issuance.</DELETED>
<DELETED>    ``(g) Recapture of Portion of Credit Where Cessation of 
Compliance.--</DELETED>
        <DELETED>    ``(1) In general.--If any bond which when issued 
        purported to be a qualified high-speed rail infrastructure bond 
        ceases to be such a qualified bond, the issuer shall pay to the 
        United States (at the time required by the Secretary) an amount 
        equal to the sum of--</DELETED>
                <DELETED>    ``(A) the aggregate of the credits 
                allowable under this section with respect to such bond 
                (determined without regard to subsection (c)) for 
                taxable years ending during the calendar year in which 
                such cessation occurs and the 2 preceding calendar 
                years, and</DELETED>
                <DELETED>    ``(B) interest at the underpayment rate 
                under section 6621 on the amount determined under 
                subparagraph (A) for each calendar year for the period 
                beginning on the first day of such calendar 
                year.</DELETED>
        <DELETED>    ``(2) Failure to pay.--If the issuer fails to 
        timely pay the amount required by paragraph (1) with respect to 
        such bond, the tax imposed by this chapter on each holder of 
        any such bond which is part of such issue shall be increased 
        (for the taxable year of the holder in which such cessation 
        occurs) by the aggregate decrease in the credits allowed under 
        this section to such holder for taxable years beginning in such 
        3 calendar years which would have resulted solely from denying 
        any credit under this section with respect to such issue for 
        such taxable years.</DELETED>
        <DELETED>    ``(3) Special rules.--</DELETED>
                <DELETED>    ``(A) Tax benefit rule.--The tax for the 
                taxable year shall be increased under paragraph (2) 
                only with respect to credits allowed by reason of this 
                section which were used to reduce tax liability. In the 
                case of credits not so used to reduce tax liability, 
                the carryforwards under subsection (c) shall be 
                appropriately adjusted.</DELETED>
                <DELETED>    ``(B) No credits against tax.--Any 
                increase in tax under paragraph (2) shall not be 
                treated as a tax imposed by this chapter for purposes 
                of determining--</DELETED>
                        <DELETED>    ``(i) the amount of any credit 
                        allowable under this part, or</DELETED>
                        <DELETED>    ``(ii) the amount of the tax 
                        imposed by section 55.</DELETED>
<DELETED>    ``(h) Other Definitions and Special Rules.--For purposes 
of this section--</DELETED>
        <DELETED>    ``(1) Bond.--The term `bond' includes any 
        obligation.</DELETED>
        <DELETED>    ``(2) Qualified project.--The term `qualified 
        project' means any project described in section 26106(a)(2) of 
        title 49, United States Code.</DELETED>
        <DELETED>    ``(3) Treatment of changes in use.--For purposes 
        of subsection (e)(2), the proceeds from the sale of an issue 
        shall not be treated as used for a qualified project to the 
        extent that the issuer takes any action within its control 
        which causes such proceeds not to be used for a qualified 
        project. The Secretary shall prescribe regulations specifying 
        remedial actions that may be taken (including conditions to 
        taking such remedial actions) to prevent an action described in 
        the preceding sentence from causing a bond to fail to be a 
        qualified high-speed rail infrastructure bond.</DELETED>
        <DELETED>    ``(4) Partnership; s corporation; and other pass-
        thru entities.--Under regulations prescribed by the Secretary, 
        in the case of a partnership, trust, S corporation, or other 
        pass-thru entity, rules similar to the rules of section 41(g) 
        shall apply with respect to the credit allowable under 
        subsection (a).</DELETED>
        <DELETED>    ``(5) Bonds held by regulated investment 
        companies.--If any qualified high-speed rail infrastructure 
        bond is held by a regulated investment company, the credit 
        determined under subsection (a) shall be allowed to 
        shareholders of such company under procedures prescribed by the 
        Secretary.</DELETED>
        <DELETED>    ``(6) Reporting.--Issuers of qualified high-speed 
        rail infrastructure bonds shall submit reports similar to the 
        reports required under section 149(e).''.</DELETED>
<DELETED>    (b) Amendments to Other Code Sections.--</DELETED>
        <DELETED>    (1) Reporting.--Subsection (d) of section 6049 of 
        the Internal Revenue Code of 1986 (relating to returns 
        regarding payments of interest) is amended by adding at the end 
        the following new paragraph:</DELETED>
        <DELETED>    ``(8) Reporting of credit on qualified high-speed 
        rail infrastructure bonds.--</DELETED>
                <DELETED>    ``(A) In general.--For purposes of 
                subsection (a), the term `interest' includes amounts 
                includible in gross income under section 54(d) and such 
                amounts shall be treated as paid on the credit 
                allowance date (as defined in section 
                54(b)(4)).</DELETED>
                <DELETED>    ``(B) Reporting to corporations, etc.--
                Except as otherwise provided in regulations, in the 
                case of any interest described in subparagraph (A), 
                subsection (b)(4) shall be applied without regard to 
                subparagraphs (A), (H), (I), (J), (K), and (L)(i) of 
                such subsection.</DELETED>
                <DELETED>    ``(C) Regulatory authority.--The Secretary 
                may prescribe such regulations as are necessary or 
                appropriate to carry out the purposes of this 
                paragraph, including regulations which require more 
                frequent or more detailed reporting.''.</DELETED>
        <DELETED>    (2) Treatment for estimated tax purposes.--
        </DELETED>
                <DELETED>    (A) Individual.--Section 6654 of such Code 
                (relating to failure by individual to pay estimated 
                income tax) is amended by redesignating subsection (m) 
                as subsection (n) and by inserting after subsection (l) 
                the following new subsection:</DELETED>
<DELETED>    ``(m) Special Rule for Holders of Qualified High-Speed 
Rail Infrastructure Bonds.--For purposes of this section, the credit 
allowed by section 54 to a taxpayer by reason of holding a qualified 
high-speed rail infrastructure bond on a credit allowance date shall be 
treated as if it were a payment of estimated tax made by the taxpayer 
on such date.''.</DELETED>
                <DELETED>    (B) Corporate.--Section 6655 of such Code 
                (relating to failure by corporation to pay estimated 
                income tax) is amended by adding at the end of 
                subsection (g) the following new paragraph:</DELETED>
        <DELETED>    ``(5) Special rule for holders of qualified high-
        speed rail infrastructure bonds.--For purposes of this section, 
        the credit allowed by section 54 to a taxpayer by reason of 
        holding a qualified high-speed rail infrastructure bond on a 
        credit allowance date shall be treated as if it were a payment 
        of estimated tax made by the taxpayer on such 
        date.''.</DELETED>
<DELETED>    (c) Clerical Amendments.--</DELETED>
        <DELETED>    (1) The table of subparts for part IV of 
        subchapter A of chapter 1 is amended by adding at the end the 
        following new item:</DELETED>

 ``subpart h. nonrefundable credit for holders of qualified high-speed 
                      rail infrastructure bonds''.
        <DELETED>    (2) Section 6401(b)(1) is amended by striking 
        ``and G'' and inserting ``G, and H''.</DELETED>
<DELETED>    (d) Issuance of Regulations.--Not later than 6 months 
after the date of the enactment of this section, the Secretary of the 
Treasury shall issue regulations for carrying out this section and the 
amendments made by this section.</DELETED>
<DELETED>    (e) High-Speed Intercity Rail Facilities.--</DELETED>
        <DELETED>    (1) Requirement to meet title 49 requirements.--
        Section 142(i) of the Internal Revenue Code of 1986 is amended 
        by adding at the end the following new paragraph:</DELETED>
        <DELETED>    ``(4) Additional requirements.--A bond issued as 
        part of an issue described in subsection (a)(11) shall not be 
        considered an exempt facility bond unless the requirements of 
        paragraphs (1) through (6) of section 26106(a) of title 49, 
        United States Code, are met.''.</DELETED>
        <DELETED>    (2) Revision of speed requirement.--Section 
        142(i)(1) of such Code is amended by striking ``150 miles per 
        hour'' and inserting ``110 miles per hour''.</DELETED>
<DELETED>    (f) Effective Date.--The amendments made by this section 
shall apply to obligations issued after the date of the enactment of 
this Act.</DELETED>

SEC. <DELETED>4.</DELETED> 2. HIGH-SPEED RAIL CORRIDOR DEVELOPMENT.

    (a) Corridor Development.--
            (1) Amendments.--Section 26101 of title 49, United States 
        Code, is amended--
                    (A) in the section heading, by striking 
                ``planning'' and inserting ``development'';
                    (B) in the heading of subsection (a), by striking 
                ``Planning'' and inserting ``Development'';
                    (C) by striking ``corridor planning'' each place it 
                appears and inserting ``corridor development'';
                    (D) in subsection (b)(1)--
                            (i) by inserting ``, or if it is an 
                        activity described in subparagraph (M)'' after 
                        ``high-speed rail improvements'';
                            (ii) by striking ``and'' at the end of 
                        subparagraph (K);
                            (iii) by striking the period at the end of 
                        subparagraph (L) and inserting ``; and''; and
                            (iv) by adding at the end the following new 
                        subparagraph:
            ``(M) the acquisition of locomotives, rolling stock, track, 
        and signal equipment.''; and
                    (E) in subsection (c)(2), by striking ``planning'' 
                and inserting ``development''.
            (2) Conforming amendment.--The item relating to section 
        26101 in the table of sections of chapter 261 of title 49, 
        United States Code, is amended by striking ``planning'' and 
        inserting ``development''.
    (b) Authorization of Appropriations.--Section 26104 of title 49, 
United States Code, is amended to read as follows:
``Sec. 26104. Authorization of appropriations
    ``(a) Fiscal Years 2006 Through 2013.--There are authorized to be 
appropriated to the Secretary--
            ``(1) $70,000,000 for carrying out section 26101; and
            ``(2) $30,000,000 for carrying out section 26102,
for each of the fiscal years 2006 through 2013.
    ``(b) Funds to Remain Available.--Funds made available under this 
section shall remain available until expended.''.

SEC. <DELETED>5.</DELETED> 3. REHABILITATION AND IMPROVEMENT FINANCING.

    (a) Definitions.--Section 102(7) of the Railroad Revitalization and 
Regulatory Reform Act of 1976 (45 U.S.C. 802(7)) is amended to read as 
follows:
            ``(7) `railroad' has the meaning given that term in section 
        20102 of title 49, United States Code; and''.
    (b) General Authority.--Section 502(a) of the Railroad 
Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(a)) is 
amended by striking ``Secretary may provide direct loans and loan 
guarantees to State and local governments,'' and inserting ``Secretary 
shall provide direct loans and loan guarantees to State and local 
governments, agreements or interstate compacts consented to by Congress 
under section 410(a) of Public Law 105-134 (49 U.S.C 24101 nt),''.
    (c) Extent of Authority.--Section 502(d) of the Railroad 
Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(d)) is 
amended--
            (1) by striking ``$3,500,000,000'' and inserting 
        ``$35,000,000,000'';
            (2) by striking ``$1,000,000,000'' and inserting 
        ``$7,000,000,000''; and
            (3) by adding at the end the following new sentence: ``The 
        Secretary shall not establish any limit on the proportion of 
        the unused amount authorized under this subsection that may be 
        used for 1 loan or loan guarantee.''.
    (d) Cohorts of Loans.--Section 502(f) of the Railroad 
Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(f)) is 
amended--
            (1) in paragraph (2)--
                    (A) by striking ``and'' at the end of subparagraph 
                (D);
                    (B) by redesignating subparagraph (E) as 
                subparagraph (F); and
                    (C) by adding after subparagraph (D) the following 
                new subparagraph:
                    ``(E) the size and characteristics of the cohort of 
                which the loan or loan guarantee is a member; and''; 
                and
            (2) by adding at the end of paragraph (4) the following: 
        ``A cohort may include loans and loan guarantees. The Secretary 
        shall not establish any limit on the proportion of a cohort 
        that may be used for 1 loan or loan guarantee.''.
    (e) Conditions of Assistance.--Section 502 of the Railroad 
Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822) is 
amended--
            (1) in subsection (f)(2)(A), by inserting ``, if any'' 
        after ``collateral offered''; and
            (2) by adding at the end of subsection (h) the following:
 ``The Secretary shall not require an applicant for a direct loan or 
loan guarantee under this section to provide collateral. The Secretary 
shall not require that an applicant for a direct loan or loan guarantee 
under this section have previously sought the financial assistance 
requested from another source. The Secretary shall require recipients 
of direct loans or loan guarantees under this section to apply the 
standards of section 26106(a)(5) of title 49, United States Code, to 
their projects.''.
    (f) Time Limit for Approval or Disapproval.--Section 502 of the 
Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 
822) is amended by adding at the end the following new subsection:
    ``(i) Time Limit for Approval or Disapproval.--Not later than 90 
days after receiving a complete application for a direct loan or loan 
guarantee under this section, the Secretary shall approve or disapprove 
the application.''.
    (g) Fees and Charges.--Section 503 of the Railroad Revitalization 
and Regulatory Reform Act of 1976 (45 U.S.C. 823) is amended by adding 
at the end the following new subsection:
    ``(l) Fees and Charges.--Except as provided in this title, the 
Secretary may not assess any fees, including user fees, or charges in 
connection with a direct loan or loan guarantee provided under section 
502.''.
    (h) Substantive Criteria and Standards.--Not later than 30 days 
after the date of the enactment of this Act, the Secretary of 
Transportation shall publish in the Federal Register and post on the 
Department of Transportation web site the substantive criteria and 
standards used by the Secretary to determine whether to approve or 
disapprove applications submitted under section 502 of the Railroad 
Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822).
                                                 Union Calendar No. 201

109th CONGRESS

  2d Session

                               H. R. 1631

                  [Report No. 109-314, Parts I and II]

_______________________________________________________________________

                                 A BILL

To provide for the financing of high-speed rail infrastructure, and for 
                            other purposes.

_______________________________________________________________________

                            February 3, 2006

   Reported from the Committee on Ways and Means with an amendment, 
   committed to the Committee of the Whole House on the State of the 
                    Union, and ordered to be printed