1.This Act may be cited as the
Community Banks Serving Their
Communities First Act
or the Communities First Act
.
<enum>I</enum><header>Targeted Regulatory Relief for Community
Banks</header>
<section commented="no" display-inline="no-display-inline" id="HF6FEE0B38E094716BBAAC35E8D8C71" section-type="subsequent-section"><enum>101.</enum><header>Increase exemption
levels under the Home Mortgage Disclosure Act of 1975</header>
<subsection commented="no" display-inline="no-display-inline" id="H9D490393323E44EC9686A416378F63CE"><enum>(a)</enum><header>Depository
institution and mortgage lender disclosure exemptions</header><text display-inline="yes-display-inline">Section 304(i) of the Home Mortgage
Disclosure Act (12 U.S.C. 2803(i)) is amended by striking
<quote>$30,000,000</quote> and inserting <quote>$250,000,000</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H2E3F41A4B496475100719E2D2C925F2C"><enum>(b)</enum><header>Depository
institution exemptions from act</header><text display-inline="yes-display-inline">Section 309 of the Home Mortgage Disclosure
Act (12 U.S.C. 2808(a)) is amended—</text>
<paragraph commented="no" display-inline="no-display-inline" id="H95BEFBFAA7304B388D2D80EF58871E73"><enum>(1)</enum><text display-inline="yes-display-inline">in subsection (a), by striking
<quote>$10,000,000</quote> and inserting <quote>$250,000,000</quote>;
and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H3D592A1DD567442F95FAEA667F4692F4"><enum>(2)</enum><text display-inline="yes-display-inline">in subsection (b), by adding at the end the
following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H651DEBD273E6483FBEC7E5B4E4976687" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="HCADDDD5AE38F401DA186F5C8D392685E"><enum>(4)</enum><header>Indexing of
depository institution disclosure exemption amount</header><text display-inline="yes-display-inline">Not
later than December 31 of each year beginning after the date of the enactment
of the Community Banks Serving Their Communities First Act, the amount
applicable under section 304(i) with respect to institutions described in
section 303(2) shall be adjusted in accordance with the procedure described in
paragraphs (1) and (3) and the adjusted amount shall apply during the
subsequent
year.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection></section><section commented="no" display-inline="no-display-inline" id="HA22065AD47B44D56B5205B935B8B6495" section-type="subsequent-section"><enum>102.</enum><header>Short form reports
of condition for certain community banks</header><text display-inline="no-display-inline">Section 7(a) of the Federal Deposit
Insurance Act (12 U.S.C. 1817(a)) is amended by adding at the end the following
new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HE536A4FC1B5D4E6FAFE315D4D7572B00" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="H5EA9D0FC67C1426B9F3537A81E30422"><enum>(11)</enum><header>Short form
reports of condition for community banks</header><text display-inline="yes-display-inline">An insured depository institution described
in subparagraphs (A), (B), (C), and (D) of section 10(d)(4) may submit a short
form report of condition under paragraph (3) in 2 nonsequential quarters of any
calendar
year.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section commented="no" display-inline="no-display-inline" id="HD9F0B2C6E9FC4916B6262FE73D93DAC5" section-type="subsequent-section"><enum>103.</enum><header>Community bank
exemption from annual management assessment of internal controls requirement of
the Sarbanes-Oxley Act of 2002</header><text display-inline="no-display-inline">Section 404 of the Sarbanes-Oxley Act of
2002 (15 U.S.C. 7262) is amended by adding at the end the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="H549A1A08E62546AEB6AB61A304F6077B" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="H43184B7E471746EC0079A2EEB547B5C8"><enum>(c)</enum><header>Community bank
exemption</header>
<paragraph commented="no" display-inline="no-display-inline" id="H3B640311005C403100EF4617F1ABF48"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">This section shall
not apply in any year to any insured depository institution which, as of the
close of the preceding year, had total assets, as determined on a consolidated
basis, of $1,000,000,000 or less.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H84EFD724AD5642E1A6FD17705156CB9F"><enum>(2)</enum><header>Adjustment of
amount</header><text display-inline="yes-display-inline">The Commission shall
annually adjust the dollar amount in paragraph (1) by an amount equal to the
percentage increase, for the most recent year, in total assets held by all
depository institutions, as reported by the Federal Deposit Insurance
Corporation.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section commented="no" display-inline="no-display-inline" id="H68168E7D151C4BE6A77600B6ABD8D8D0" section-type="subsequent-section"><enum>104.</enum><header>Changes required to
small bank holding company policy statement on assessment of financial and
managerial factors</header>
<subsection commented="no" display-inline="no-display-inline" id="HC40A2C8C04C1408D9E78CB9D6FF24212"><enum>(a)</enum><header>Small bank
holding company policy statement on assessment of financial and managerial
factors</header>
<paragraph commented="no" display-inline="no-display-inline" id="H6D7A1DC19A894DB300EA80EE6D10803"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Not later than 6
months after the date of enactment of this Act, the Board of Governors of the
Federal Reserve System shall publish in the Federal Register proposed revisions
to appendix C of section 225 of title 12, Code of Federal Regulations, commonly
known as the Small Bank Holding Company Policy Statement on Assessment of
Financial and Managerial Factors that provide that the policy shall apply to a
bank holding company which has pro forma consolidated assets of less than
$1,000,000,000 and that—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="HC128F40CA69F49BCBE844B96AD75341F"><enum>(A)</enum><text display-inline="yes-display-inline">is not engaged in any nonbanking activities
involving significant leverage; and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H877622F4506C4F6090116579DBB241B5"><enum>(B)</enum><text display-inline="yes-display-inline">does not have a significant amount of
outstanding debt that is held by the general public.</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="H16E8362CFA0A43159D67B015003E5614"><enum>(2)</enum><header>Adjustment of
amount</header><text display-inline="yes-display-inline">The Board of Governors
of the Federal Reserve System shall annually adjust the dollar amount referred
to in paragraph (1) by an amount equal to the percentage increase, for the most
recent year, in total assets held by all bank holding companies, on a
consolidated basis, as determined by the Board.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H034EE1AB2F2F4109B2AB0034DD90F499"><enum>(b)</enum><header>Increase in
debt-to-Equity ratio of small bank holding company</header><text display-inline="yes-display-inline">Not
later than 6 months after the date of enactment of this Act, the Board of
Governors of the Federal Reserve System shall publish in the Federal Register
proposed revisions to appendix C of section 225 of title 12, Code of Federal
Regulations, commonly known as the Small Bank Holding Company Policy Statement
on Assessment of Financial and Managerial Factors such that the debt-to-equity
ratio allowable for a small bank holding company in order to remain eligible to
pay a corporate dividend and to remain eligible for expedited processing
procedures under Regulation Y of the Board of Governors of the Federal Reserve
System would increase from 1:1 to 3:1.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H77378776C28C4300BA8CC3184D00FFE9" section-type="subsequent-section"><enum>105.</enum><header>Increase in size of
a small depository institution exception under the Depository Institution
Management Interlocks Act</header><text display-inline="no-display-inline">Section 203(1) of the Depository Institution
Management Interlocks Act (12 U.S.C. 3202(1)) is amended by striking
<quote>$20,000,000</quote> and inserting <quote>$500,000,000</quote>.</text>
</section><section commented="no" display-inline="no-display-inline" id="H5B2C732B03E340BFBDE178B181C03766" section-type="subsequent-section"><enum>106.</enum><header>Community bank
protection under the Securities Investor Protection Act of 1970</header><text display-inline="no-display-inline">Section 9 of the Securities Investor
Protection Act of 1970 (15 U.S.C. 78fff–3) is amended by adding at the end the
following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H44D69E8E829F46F1ACF73794B779E418" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="H10B12EA161C1456F877E0077BB9E2372"><enum>(d)</enum><header>Community bank
protection</header>
<paragraph commented="no" display-inline="no-display-inline" id="H14FCB20455A4471E9DCB588D1B613F8B"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The prohibition on
advances in subsection (a)(5) shall not apply to a bank with total assets, on a
consolidated basis, of less than $1,000,000,000.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H9A903261EB1541BD89F69408013228D0"><enum>(2)</enum><header>Adjustment of
amount</header><text display-inline="yes-display-inline">The Commission shall
annually adjust the dollar amount in paragraph (1) by an amount equal to the
percentage increase, for the most recent year, in total assets held by all
depository institutions, as reported by the Federal Deposit Insurance
Corporation.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section commented="no" display-inline="no-display-inline" id="H34B56F3A0D944BD89465CA7D209D3945" section-type="subsequent-section"><enum>107.</enum><header>Flexible examination
schedule for community banks</header>
<subsection commented="no" display-inline="no-display-inline" id="H2F1D7ABF4A244B23A6ED5F46C00AF1"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Paragraph (4) of
section 10(d) of the Federal Deposit Insurance Act (12 U.S.C. 1820(d)) is
amended—</text>
<paragraph commented="no" display-inline="no-display-inline" id="HB0AE121C00224A88825F43347FB4AEC6"><enum>(1)</enum><text display-inline="yes-display-inline">by striking the matter preceding
subparagraph (A) and inserting <quote>In lieu of the 12-month period referred
to in paragraphs (1), (2), and (3), the examination required under paragraph
(1) of an insured depository institution may be conducted at such intervals as
the appropriate Federal banking agency may determine to be appropriate, on the
basis of factors the Financial Institutions Examination Council shall
establish, if—</quote>; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H407FA4BFE89D4FCC928E5D44C4D6D520"><enum>(2)</enum><text display-inline="yes-display-inline">in subparagraph (A), by striking
<quote>$250,000,000</quote> and inserting <quote>$1,000,000,000</quote>.</text>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H8B301E878BF344BC8C092E1D23348E65"><enum>(b)</enum><header>Clerical
amendment</header><text display-inline="yes-display-inline">The heading for
paragraph (4) of section 10(d) of the Federal Deposit Insurance Act (12 U.S.C.
1820(d)) is amended by striking <quote><header-in-text level="subparagraph" style="OLC">18-month rule</header-in-text></quote> and inserting
<quote><header-in-text level="subparagraph" style="OLC">Flexible on-site
examination schedule</header-in-text></quote>.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H7F72F114110F430B866E5395A7EA378C" section-type="subsequent-section"><enum>108.</enum><header>Increase in amount
of small bank exception for cap on aggregate loans to executive
officers</header><text display-inline="no-display-inline">Subparagraph (C) of
section 22(h)(5) of the Federal Reserve Act (12 U.S.C. 375b(5)(C)) is
amended—</text>
<paragraph commented="no" display-inline="no-display-inline" id="idAC23C7AD015847E5B1A95A93FCAA1823"><enum>(1)</enum><text display-inline="yes-display-inline">in the first sentence—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="id1703714D94994E28AE412B53F51A2D25"><enum>(A)</enum><text display-inline="yes-display-inline">by striking <quote>The Board</quote> and
inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="id30C8A80173774E9C880BE29D0EE457AA" style="OLC">
<clause commented="no" display-inline="no-display-inline" id="id9715DCFDEAA14608A5C637B35264D5B3"><enum>(i)</enum><header>Small
insitution exception</header><text display-inline="yes-display-inline">The
Board</text>
</clause><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="idF52C18018DA04F46B97D76C59188A279"><enum>(B)</enum><text display-inline="yes-display-inline">by striking <quote>$100,000,000 of
deposits</quote> and inserting <quote>$1,000,000,000 of total assets (on a
consolidated basis)</quote>; and</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="idBF5E17F6624646E8BC800C5C95F07FC1"><enum>(2)</enum><text display-inline="yes-display-inline">in the second sentence, by striking
<quote>In no case</quote> and inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="idE015FBAC80C84198B84D5AFBE2630305" style="OLC">
<clause commented="no" display-inline="no-display-inline" id="idFE4152C3304744EFB66B613BD9D9B282"><enum>(ii)</enum><header>Cap on credit
extension to executive officers</header><text display-inline="yes-display-inline">In no
case</text>
</clause><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HE01D06FDCDFF4E92B11FC8310728CE4B"><enum>(3)</enum><text display-inline="yes-display-inline">by adding at the end the following:</text>
<quoted-block display-inline="no-display-inline" id="id5257ACC2B7DA474E85BB2D94A53D51ED" style="OLC">
<clause commented="no" display-inline="no-display-inline" id="id115A6091F8D34A249A29418BAF8D2E2B"><enum>(iii)</enum><header>Annual
adjustment</header><text display-inline="yes-display-inline">The Board shall
annually adjust the dollar amount in clause (i) of this subparagraph by an
amount equal to the percentage increase, for the most recent year, in total
assets held by all depository institutions, as reported by the Federal Deposit
Insurance
Corporation.</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></section><section commented="no" display-inline="no-display-inline" id="HE300DE335D7D4599999D3B044DBCB899" section-type="subsequent-section"><enum>109.</enum><header>Consideration of
community bank impact</header><text display-inline="no-display-inline">Before
establishing or making any revision in any regulation, requirement, or
guideline applicable to insured depository institutions (as defined in section
3 of the Federal Deposit Insurance Act), the appropriate Federal banking agency
(as defined in such section) shall take into account the effect of the
establishment of the regulation, requirement, or guideline on community banks
and savings associations.</text>
</section><section commented="no" display-inline="no-display-inline" id="H9C095A167CF541FE00960729001F00A0" section-type="subsequent-section"><enum>110.</enum><header>Increase in CRA exam
intervals for community banks</header><text display-inline="no-display-inline">Section 809(a) of the Community Reinvestment
Act of 1977 (12 U.S.C. 2908(a)) is amended by striking
<quote>$250,000,000</quote> and inserting <quote>$1,000,000,000</quote>.</text>
</section><enum>II</enum><header>Additional Regulatory Relief for Community
Banks and their Customers</header>
<section commented="no" display-inline="no-display-inline" id="H07EFCB3A670A42FD8221DF62DEA69F8F" section-type="subsequent-section"><enum>201.</enum><header>Provisions relating
to 3-day right of rescission under the Truth in Lending Act</header>
<subsection commented="no" display-inline="no-display-inline" id="H0B33F5CBE7B948C2A5C000B373C303D9"><enum>(a)</enum><header>Optional
consumer waivers of right of rescission</header><text display-inline="yes-display-inline">Section 125(d) of the Truth in Lending Act
(15 U.S.C. 1635(d)) is amended—</text>
<paragraph commented="no" display-inline="no-display-inline" id="H8F01A76E352B4117A3553BCA3C3BA0C5"><enum>(1)</enum><text display-inline="yes-display-inline">by striking <quote>The Board may</quote>
and inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="H0E9F060202D74189B8FF68CB7F4C4395" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="HB699740220794175AEC4BFCC7B9C58C7"><enum>(1)</enum><header>Personal
financial emergencies</header><text display-inline="yes-display-inline">The
Board may</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HB5C4772554144BABB73315F61FCE5200"><enum>(2)</enum><text display-inline="yes-display-inline">by adding at the end the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HA44AF0B9AAEF4079B0D2001FE47C3853" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="H4C7D8C5C2B8C465EADA0BDF5D29C033D"><enum>(2)</enum><header>Waivers when
creditor is insured depository institution</header><text display-inline="yes-display-inline">The Board shall prescribe regulations
authorizing a consumer to waive the rights provided under this section when the
creditor is an insured depository institution (as that term is defined in
section 3(c)(2) of the Federal Deposit Insurance Act) in such manner and after
such notice as the Board may
prescribe.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="idA83461EB271048F5AE3A2E13D89972FC"><enum>(b)</enum><header>Clerical
amendment</header><text display-inline="yes-display-inline">The heading for
subsection (d) of section 125 of the Truth in Lending Act (15 U.S.C. 1635) is
amended by striking <quote><header-in-text level="subsection" style="OLC">Waiver of Rights.—</header-in-text></quote> and inserting
<quote><header-in-text level="subsection" style="OLC">Waivers of Rescission
Rights.—</header-in-text></quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H5D7BCFAC43014DAAA6571B5500315C00"><enum>(c)</enum><header>Exemption in
case of refinancing with no new money regardless of creditor</header><text display-inline="yes-display-inline">Section 125(e)(2) of the Truth in Lending
Act (15 U.S.C. 1635(e)(2)) is amended by striking <quote>by the same
creditor</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HFCC1D748D704418D963EAA9E4BEC1B11"><enum>(d)</enum><header>Exempt home
equity lines of credit</header><text display-inline="yes-display-inline">Section 125(e)(4) of the Truth in Lending
Act (15 U.S.C. 1635(e)(4)) is amended to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="H5E3FD3D77AD7408F0079ED11A6274EF9" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="HCBC292CD79CE4A64BF1986FCD38BBEA"><enum>(4)</enum><text display-inline="yes-display-inline">advances under an open end consumer credit
plan which provides for any extension of credit which is secured by the
principal dwelling of a
consumer.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H498F3A20ACA642060048713BC658F5D3" section-type="subsequent-section"><enum>202.</enum><header>Additional
exemptions under Home Mortgage Disclosure Act of 1975; streamlining
reporting</header>
<subsection commented="no" display-inline="no-display-inline" id="H2B8E7226742E458090EBDDB8B3D1B13"><enum>(a)</enum><header>Small reporter
exemption</header><text display-inline="yes-display-inline">Section 304 of the
Home Mortgage Disclosure Act (12 U.S.C. 2803) is amended by adding at the end
the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H1CF3F1D843E14499913FD40659909C18" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="H98EA1FD1A5A34CBE91F34615271BE005"><enum>(n)</enum><header>Small reporter
exemption</header><text display-inline="yes-display-inline">If, in any year, a
depository institution makes fewer than 100 reportable loans described in any
paragraph of subsection (b), the depository institution shall be exempt from
the disclosure requirements of this section with respect to the loans described
in that paragraph for such
year.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HF4D1BE0D4BB34DDDB4A356988C17AD10"><enum>(b)</enum><header>MSA
modifications</header><text display-inline="yes-display-inline">Section 304(a)
of the Home Mortgage Disclosure Act (12 U.S.C. 2803(a)) is amended——</text>
<paragraph commented="no" display-inline="no-display-inline" id="H03DF9A2E28D34B99B9A6052FE0876900"><enum>(1)</enum><text display-inline="yes-display-inline">in paragraph (1), by inserting <quote>or as
modified by the Board under paragraph (3),</quote> after <quote>as defined by
the Department of Commerce</quote>; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H191DC0EC11774D69A0A30491B7734099"><enum>(2)</enum><text display-inline="yes-display-inline">by adding at the end the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HFB4977D519C041F5ABC71F68C6774C52" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="H5BC1B2A98C2549FDB2848567249F779E"><enum>(3)</enum><header>Modification of
MSAs</header><text display-inline="yes-display-inline">The Board may modify the
description of any primary metropolitan statistical area, metropolitan
statistical area, and consolidated metropolitan statistical area, as defined by
the Secretary of Commerce, for purposes of this
subsection.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H02A6BFA19E254A2C8B2D5E59E9CC3B13"><enum>(c)</enum><header>Regular
streamlining</header><text display-inline="yes-display-inline">The Home
Mortgage Disclosure Act (12 U.S.C. 2801 et seq.) is amended by adding at the
end the following new section:</text>
<quoted-block display-inline="no-display-inline" id="HF929733E0C5F4717A59374002DF5DD96" style="OLC">
<section commented="no" display-inline="no-display-inline" id="HE40EB1F401944C728523EA7EDF726EDA" section-type="subsequent-section"><enum>312.</enum><header>Regular
streamlining</header><text display-inline="no-display-inline">Not later than 1
year after the date of enactment of the Community Banks Serving Their
Communities First Act and once during each 5-year period thereafter, the Board
shall—</text>
<paragraph commented="no" display-inline="no-display-inline" id="HA1A6B3D805664CF8ADC22400CC724096"><enum>(1)</enum><text display-inline="yes-display-inline">review the data collection and reporting
requirements of this title;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H4099EDDDBD694F8D0011A339FC00BBA0"><enum>(2)</enum><text display-inline="yes-display-inline">streamline, reduce, or eliminate such
requirements by regulation to the extent consistent with the purposes of this
title;</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HB9EED19C6B9C44E8B98628ABC634B17"><enum>(3)</enum><text display-inline="yes-display-inline">revise the data collection and reporting
requirements under this title to ensure that they are consistent with those
imposed under the Equal Credit Opportunity Act; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HF28F88130FC64E91A0A6E614DE59E97"><enum>(4)</enum><text display-inline="yes-display-inline">report to the Committee on Banking,
Housing, and Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives such legislative recommendations as
the Board determines to be necessary—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="idC1A200FBD39740F88DA5E8066F981BDA"><enum>(A)</enum><text display-inline="yes-display-inline">to streamline, reduce, or eliminate such
requirements to the extent consistent with the purposes of this title;
and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id27CE9A35ABFD4514BF72A9B1C8DF6479"><enum>(B)</enum><text display-inline="yes-display-inline">to ensure that such requirements are
consistent with those imposed under the Equal Credit Opportunity
Act.</text>
</subparagraph></paragraph></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H54F211B97EF5468CB8CDC24199342CE8" section-type="subsequent-section"><enum>203.</enum><header>Exception to annual
privacy notice requirement under the Gramm-Leach-Bliley Act</header><text display-inline="no-display-inline">Section 503 of the Gramm-Leach-Bliley Act
(15 U.S.C. 6803) is amended by adding at the end the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="HF4A1238F35794AE39DC07E8BC503B900" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="H97707FB9CF894316B3B69EC6BB184EA5"><enum>(c)</enum><header>Exception to
Annual Notice Requirement</header><text display-inline="yes-display-inline">A
financial institution shall be exempt from the annual disclosure requirement
under subsection (a), if such financial institution—</text>
<paragraph commented="no" display-inline="no-display-inline" id="H0995DB93DA7A4A129FB5EA04913083C0"><enum>(1)</enum><text display-inline="yes-display-inline">provides nonpublic personal information
only in accordance with the provisions of section 502(b)(2) (relating to the
consumer <quote>opt out</quote> exception) and subsection 502(e) (relating to
general exceptions); and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H7B75A03D9E764F4C8B54F0DE3CBA915F"><enum>(2)</enum><text display-inline="yes-display-inline">has not changed its policies and practices
with regard to disclosing nonpublic personal
information.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section commented="no" display-inline="no-display-inline" id="H942428BAC8994AA2BE649FBC1BBFD1D9" section-type="subsequent-section"><enum>204.</enum><header>Streamlining reports
of condition</header><text display-inline="no-display-inline">Section 7(a) of
the Federal Deposit Insurance Act (12 U.S.C. 1817(a)), as amended by section
102 of this Act, is amended by adding at the end the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HEA80E108F2F64D54BF85B96995B25331" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="H25C2EEC4629F4C2491590037FB04025E"><enum>(12)</enum><header>Streamlining
Reports of Condition</header>
<subparagraph commented="no" display-inline="no-display-inline" id="HEBC0FA31EE454D29BAB83EBA5CC20FA"><enum>(A)</enum><header>Review of
information and schedules</header><text display-inline="yes-display-inline">Not
later than 1 year after the date of enactment of the Community Banks Serving
Their Communities First Act and once during each 5-year period thereafter, the
Corporation shall, in conjunction with the Board of Governors of the Federal
Reserve System, the Comptroller of the Currency, and the Director of the Office
of Thrift Supervision, review the information and schedules that are required
to be filed by any insured depository institution with a report of condition
under paragraph (3).</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H1ED1E744D0D7493297E2708800C40CC"><enum>(B)</enum><header>Reduction or
elimination of filings which are more burdensome than beneficial</header><text display-inline="yes-display-inline">Not later than 9 months after completing
any review under subparagraph (A), the Corporation, the Board of Governors of
the Federal Reserve System, the Comptroller of the Currency, and the Director
of the Office of Thrift Supervision shall reduce or eliminate any requirement
to file information or schedules under paragraph (3) if such agencies find that
the burdens of such filings are not outweighed by—</text>
<clause commented="no" display-inline="no-display-inline" id="id8F81169B48A34084A9E30CB1879A8990"><enum>(i)</enum><text display-inline="yes-display-inline">the benefits to safety and soundness of the
financial system; or</text>
</clause><clause commented="no" display-inline="no-display-inline" id="id84F19A94689042A88C8956D80956C4D3"><enum>(ii)</enum><text display-inline="yes-display-inline">the ability of the Corporation to
accurately determine the financial condition and the results of operations of
each insured depository institution.</text>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HD614E58B1A4243BEBCD3D0FF6470000"><enum>(C)</enum><header>Report to the
congress</header><text display-inline="yes-display-inline">Not later than 6
months after the date of completion of any review under subparagraph (A), the
Corporation, the Board of Governors of the Federal Reserve System, the
Comptroller of the Currency, and the Director of the Office of Thrift
Supervision shall submit a report to the Committee on Financial Services of the
House of Representatives and the Committee on Banking, Housing, and Urban
Affairs of the Senate containing—</text>
<clause commented="no" display-inline="no-display-inline" id="id3F8654BD27744C408F3F86CFE0369E53"><enum>(i)</enum><text display-inline="yes-display-inline">the findings of the agencies with respect
to such review; and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="idC33728AF636241BFA1D1D455CCD95681"><enum>(ii)</enum><text display-inline="yes-display-inline">any recommendations of such agencies for
legislative action to implement any such
findings.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section commented="no" display-inline="no-display-inline" id="HA8009D6992C94492A0412D0027915900" section-type="subsequent-section"><enum>205.</enum><header>Increase in the
special regulatory lending limit on loans to executive officers</header><text display-inline="no-display-inline">Section 22(g) of the Federal Reserve Act (12
U.S.C. 375a(g)) is amended by adding at the end the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H7F4A714193924A5EBAFE6BE749A0A288" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="H355C6EE6E25E4ECFB5EF004CF74B3977"><enum>(11)</enum><header>Limit
applicable on aggregate amount of certain loans to executive officers of
community banks</header><text display-inline="yes-display-inline">Notwithstanding any regulation prescribed
by the Board under paragraph (4) and subject to other conditions imposed under
this subsection and section 22(h), the aggregate amount of extensions of credit
that a member bank may make to an executive officer of the bank under paragraph
(4) shall not exceed
$250,000.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</section><enum>III</enum><header>Tax Relief for Bank Depositors, Rural
Banks, Municipalities, and Banks Organized as Limited Liability
Companies</header>
<section commented="no" display-inline="no-display-inline" id="H3A4581B216B8482798EA44EA684BE8FD" section-type="subsequent-section"><enum>301.</enum><header>Reduced rate and
deferral of income recognition on long-term certificates of deposit</header>
<subsection commented="no" display-inline="no-display-inline" id="H247D6F697E4E43F58CB7A517F8838827"><enum>(a)</enum><header>Deferral of
income recognition</header><text display-inline="yes-display-inline">Section
451 of the Internal Revenue Code of 1986 (relating to general rule for taxable
year of inclusion) is amended by adding at the end the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="H2721B3B497684DD8A17572C3077CE71E" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="H77D18AA09A364990A4183C6924AEA653"><enum>(j)</enum><header>Certificates of
deposits held by cash basis individuals</header><text display-inline="yes-display-inline">In the case of an individual on the cash
receipts and disbursements method of accounting who holds a nonnegotiable
certificate of deposit, interest income which is not made available for
withdrawal before maturity of the certificate without penalty shall not be
includible in gross income before the certificate is redeemed or
matures.</text>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HFF6DD083E225408E88F9B400F1E21508"><enum>(b)</enum><header>Interest income
on long-Term certificates of deposit</header><text display-inline="yes-display-inline">Section 1(h)(11)(A) of the Internal Revenue
Code of 1986 is amended by striking <quote>increased by</quote> and all that
follows through the end and
inserting:</text>
<quoted-block display-inline="yes-display-inline" id="HE43318F6D4DC4EE49000C8FBFCDA9900" style="OLC">
<text>increased
by—</text><clause commented="no" display-inline="no-display-inline" id="H857197056A504547000294DBDECF488E"><enum>(i)</enum><text display-inline="yes-display-inline">qualified dividend income; and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H80EC98BD76904356960000C568F9F5A6"><enum>(ii)</enum><text display-inline="yes-display-inline">interest income on any nonnegotiable
certificate of deposit—</text>
<subclause commented="no" display-inline="no-display-inline" id="H0E69611ECCE04CE8A5FB6DA186D47FE"><enum>(I)</enum><text display-inline="yes-display-inline">with a fixed maturity date which is 1 year
or more from the date of issue, and</text>
</subclause><subclause commented="no" display-inline="no-display-inline" id="H522638431555465FB721C91000F7EEE8"><enum>(II)</enum><text display-inline="yes-display-inline">the interest on which is not made available
for withdrawal before maturity without
penalty.</text>
</subclause></clause><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H2FC1DA0C52854727A9829D5520D7C607"><enum>(c)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to taxable years beginning after the date of the
enactment of this Act.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H1B95B3734F8C45509634C1E352E15DB3" section-type="subsequent-section"><enum>302.</enum><header>Exclusion for
interest on loans secured by agricultural real property</header>
<subsection commented="no" display-inline="no-display-inline" id="H89EA98D3E5B745CD9666E02C8E3C7B2"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Part III of
subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to
items specifically excluded from gross income) is amended by inserting after
section 139A the following new section:</text>
<quoted-block display-inline="no-display-inline" id="idCB726258848E45D8805CDA84C6655991" style="OLC">
<section commented="no" display-inline="no-display-inline" id="H4623CD48030B44CCB550465E88A8A5AB" section-type="subsequent-section"><enum>139B.</enum><header>Interest on loans
secured by agricultural real property</header>
<subsection commented="no" display-inline="no-display-inline" id="H396201FFBFD44C72A9734702DE4F74CA"><enum>(a)</enum><header>Exclusion</header><text display-inline="yes-display-inline">Gross income shall not include interest
received by a qualified lender on any qualified real estate loan.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H7C4528E19B9143EDB5EE098E6023F1E"><enum>(b)</enum><header>Coordination with
section 265</header><text display-inline="yes-display-inline">Qualified real
estate loans shall be treated as obligations described in section 265(a)(2),
the interest on which is wholly exempt from the taxes imposed by this
subtitle.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H78777C1A06DC49849292199B5F98BC1F"><enum>(c)</enum><header>Definitions</header><text display-inline="yes-display-inline">For purposes of this section:</text>
<paragraph commented="no" display-inline="no-display-inline" id="HE6CFE9A7625B47AEB67CD1E15BA77F56"><enum>(1)</enum><header>Qualified
lender</header><text display-inline="yes-display-inline">The term
<quote>qualified lender</quote> means any bank or savings association the
deposits of which are insured under the Federal Deposit Insurance Act (12
U.S.C. 1811 et seq.).</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HE694094DCE9E4FADBB45FE7B32C4E78C"><enum>(2)</enum><header>Qualified real
estate loan</header>
<subparagraph commented="no" display-inline="no-display-inline" id="id3B13A5DDF3FB4F098F73B3727FCC4CC0"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The term
<quote>qualified real estate loan</quote> means any loan secured by
agricultural real estate or by a leasehold mortgage (with a status as a lien)
on agricultural real estate.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="idC0388FD8015A471C89067DF7EAF335C5"><enum>(B)</enum><header>Determination
of agricultural real estate</header><text display-inline="yes-display-inline">For purposes of subparagraph (A), the
determination of whether property securing such loan is agricultural real
estate shall be made as of the time the interest income on such loan is
accrued.</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="H2843F3DFA4E74C59B09B9D3B53B92C97"><enum>(3)</enum><header>Agricultural
real estate</header><text display-inline="yes-display-inline">The term
<quote>agricultural real estate</quote> means—</text>
<subparagraph commented="no" display-inline="no-display-inline" id="H6544BAC34B2E434395B2C4AC45E4A0B7"><enum>(A)</enum><text display-inline="yes-display-inline">real property used for the production of 1
or more agricultural products, and</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H34BB2F52BA2D4E5FAB603662111031A3"><enum>(B)</enum><text display-inline="yes-display-inline">any single family residence which
is—</text>
<clause commented="no" display-inline="no-display-inline" id="H568B99146076421E85EF5874DBB8CD42"><enum>(i)</enum><text display-inline="yes-display-inline">the principal residence (within the meaning
of section 121) of its occupant;</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H0D71B2A735144A230039AEEE4F9352E1"><enum>(ii)</enum><text display-inline="yes-display-inline">located in a rural area (as determined by
the Secretary of Agriculture)—</text>
<subclause commented="no" display-inline="no-display-inline" id="idFB843CEECEF74B669174BF44F3BC584F"><enum>(I)</enum><text display-inline="yes-display-inline">which is not within a Metropolitan
Statistical Area (as defined by the Office of Management and Budget),
and</text>
</subclause><subclause commented="no" display-inline="no-display-inline" id="idACFDBAA60F2B431D9E78D894F913908E"><enum>(II)</enum><text display-inline="yes-display-inline">which has a population (determined on the
basis of the most recent decennial census for which data are available) of
2,500 or less, and</text>
</subclause></clause><clause commented="no" display-inline="no-display-inline" id="H3F8FD32A559F48459189B009217F74C0"><enum>(iii)</enum><text display-inline="yes-display-inline">purchased or improved with the proceeds of
the qualified real estate
loan.</text>
</clause></subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H1AF5C9B385C249108D7DD7F5E47D0604"><enum>(b)</enum><header>Clerical
amendment</header><text display-inline="yes-display-inline">The table of
sections for part III of subchapter B of chapter 1 of the Internal Revenue Code
of 1986 is amended by inserting after the item relating to section 139A the
following new item:</text>
<toc regeneration="no-regeneration">
<toc-entry bold="off" level="section"><quote>Sec. 139B. Interest on
loans secured by agricultural real property.</quote></toc-entry>
</toc>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H5FF0B8AB60964DB89BFA9B1C5B4BDC7E"><enum>(c)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to taxable years beginning after the date of the
enactment of this Act.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H1371F24346A5478799DFB7BE986231A0" section-type="subsequent-section"><enum>303.</enum><header>Increase in cap on
qualified small issue bonds</header>
<subsection commented="no" display-inline="no-display-inline" id="HC6D63783D43741E88E914EE2F13C2B9"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section
144(a)(4)(A)(i) of the Internal Revenue Code of 1986 (relating to general rule
for $10,000,000 limit in certain cases) is amended by striking
<quote>$10,000,000</quote> and inserting <quote>$30,000,000</quote>.</text>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H23F32E5D8CB84E1A8CC21E227314A627"><enum>(b)</enum><header>Adjustment of
cap for inflation</header><text display-inline="yes-display-inline">Section
144(a) of the Internal Revenue Code of 1986 (relating to qualified small issue
bond) is amended—</text>
<paragraph commented="no" display-inline="no-display-inline" id="id3A6CD22FDBCE4C229C0410CA52A2036F"><enum>(1)</enum><text display-inline="yes-display-inline">by redesignating paragraph (12) as
paragraph (13); and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="id53B999F0C7C1499DBE4604FBB8A2149A"><enum>(2)</enum><text display-inline="yes-display-inline">by inserting after paragraph (11) the
following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HD09F039959454FA7826152DA00D1F9E9" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="HDFBE7A8054D74B399C3FDB835855E3EB"><enum>(12)</enum><header>Inflation
adjustment</header>
<subparagraph commented="no" display-inline="no-display-inline" id="id984EB2AED4134A7A9C2B00D1FF3FE570"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">In the case of any
calendar year after 2006, the $30,000,000 amount contained in paragraph
(4)(A)(i) shall be increased by an amount equal to—</text>
<clause commented="no" display-inline="no-display-inline" id="H7188EFE550844EB0BEFD51F8EBC32BF0"><enum>(i)</enum><text display-inline="yes-display-inline">such dollar amount, multiplied by</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H145D4B7092CF40E9A9BFDD225E5D6588"><enum>(ii)</enum><text display-inline="yes-display-inline">the cost-of-living adjustment determined
under section 1(f)(3) for such calendar year by substituting <quote>calendar
year 2005</quote> for <quote>calendar year 1992</quote> in subparagraph (B)
thereof.</text>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id0EBBFD3231C741A5871B5AAD308BF93D"><enum>(B)</enum><header>Rounding</header><text display-inline="yes-display-inline">Any increase under subparagraph (A) which
is not a multiple of $100,000 shall be rounded to the next lowest multiple of
$100,000.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="H8A0D5DB7BF8A4AE5BA6CDDF09216DB27"><enum>(c)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to—</text>
<paragraph commented="no" display-inline="no-display-inline" id="H51CA2BA0FC8C475EB32E66D611A723ED"><enum>(1)</enum><text display-inline="yes-display-inline">obligations issued after the date of the
enactment of this Act; and</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HC5E51A9171304B22BF61FA004FC03041"><enum>(2)</enum><text display-inline="yes-display-inline">capital expenditures made after such date
with respect to obligations issued on or before such date.</text>
</paragraph></subsection></section><section commented="no" display-inline="no-display-inline" id="H157242B5085D4AB38283416520CC2484" section-type="subsequent-section"><enum>304.</enum><header>Limited liability
company tax treatment for FDIC-Insured limited liability companies</header>
<subsection commented="no" display-inline="no-display-inline" id="H6D8FA473069F482687DC559EF6696BE4"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 7701(a)(2) of
the Internal Revenue Code of 1986 (defining partnership and partner) is amended
to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="H26DCC825B25E4976997300688EA9955E" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="HF1F763E8A3FD41BFBCA9D6597B002501"><enum>(2)</enum><header>Partner and
partnership</header>
<subparagraph commented="no" display-inline="no-display-inline" id="H646907F28DA04DC58BD8BEE18120465"><enum>(A)</enum><header>Partnership</header><text display-inline="yes-display-inline">The term <term>partnership</term> includes
a syndicate, group, pool, joint venture, or other unincorporated organization,
through or by means of which any business, financial operation, or venture is
carried on, and which is not, within the meaning of this title, a trust or
estate or a corporation.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id606D2B467F4C41218196FDEFDBA2978A"><enum>(B)</enum><header>Partner</header><text display-inline="yes-display-inline">The term <term>partner</term> includes a
member in any syndicate, group, pool, joint venture, or organization described
in subparagraph (A).</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H7260880ADC2544BB9B551CF0DBC32EDB"><enum>(C)</enum><header>Election by
certain banks to be taxed as partnerships</header>
<clause commented="no" display-inline="no-display-inline" id="HC486AA5D937941CFB9EA5006839864B6"><enum>(i)</enum><header>In
general</header><text display-inline="yes-display-inline">An eligible
corporation may elect to be treated as a partnership for purposes of this
title.</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H99FAA331A9E0472DA296D4A4C900FF05"><enum>(ii)</enum><header>Tax
treatment</header><text display-inline="yes-display-inline">In the case of an
eligible corporation making an election under clause (i)—</text>
<subclause commented="no" display-inline="no-display-inline" id="H6FD2F2018B5A4641946684853661D01E"><enum>(I)</enum><text display-inline="yes-display-inline">no gain or loss shall be recognized to the
corporation or the shareholders by reason of an election under clause (i),
and</text>
</subclause><subclause commented="no" display-inline="no-display-inline" id="H85EAB69285A34669B25EFCFDA5D5845F"><enum>(II)</enum><text display-inline="yes-display-inline">section 1374 shall apply to the entity
after such election.</text>
</subclause></clause><clause commented="no" display-inline="no-display-inline" id="H08D547B4018B477C8D4DB38495FFBBB5"><enum>(iii)</enum><header>Eligible
corporation</header><text display-inline="yes-display-inline">The term
<quote>eligible corporation</quote> means any of the following entities which
would (but for this subparagraph) be treated as a C corporation for purposes of
this title:</text>
<subclause commented="no" display-inline="no-display-inline" id="H5FB3F99AA5234BFEA8D9E433C868D096"><enum>(I)</enum><text display-inline="yes-display-inline">Any bank (as defined in section
581).</text>
</subclause><subclause commented="no" display-inline="no-display-inline" id="H76981D70DA6E4976B0DE53BD79E27A8"><enum>(II)</enum><text display-inline="yes-display-inline">Any bank holding company (as defined in
section 2(a) of the Bank Holding Company Act of 1956 (12 U.S.C.
1841(a))).</text>
</subclause><subclause commented="no" display-inline="no-display-inline" id="H23A16B6C9C9040C3827B31BB123993D1"><enum>(III)</enum><text display-inline="yes-display-inline">Any savings association (as defined in
section 3(b) of the Federal Deposit Insurance Act (12 U.S.C. 1813)).</text>
</subclause><subclause commented="no" display-inline="no-display-inline" id="HA81768D109D44CADAED6267420EB1188"><enum>(IV)</enum><text display-inline="yes-display-inline">Any savings and loan holding company (as
defined in section 10(a)(1)(D) of the Home Owners Loan
Act).</text>
</subclause></clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="H5B9AD5C1F1E3484E81B000AAF007EF2"><enum>(b)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendment made by
this section shall apply to taxable years beginning after the date of the
enactment of this Act.</text>
</subsection></section><enum>IV</enum><header>Tax Relief for Community Banks and Holding
Companies</header>
<section commented="no" display-inline="no-display-inline" id="H148DCAB997DA479892E5DA8E2234F598" section-type="subsequent-section"><enum>401.</enum><header>Reduction in
tax</header>
<subsection commented="no" display-inline="no-display-inline" id="H0EC6297A83F64F42B2BB59538B21A415"><enum>(a)</enum><header>C
corporations</header><text display-inline="yes-display-inline">Section 11 of
the Internal Revenue Code of 1986 (relating to tax imposed) is amended by
adding at the end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H876DDF4520D4480B910994DAC0D9BF85" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="H9CA6AD93EA0F4DD388B5275D8F5A061"><enum>(e)</enum><header>Reduction of tax
on community banks</header>
<paragraph commented="no" display-inline="no-display-inline" id="HFF7F7073F05F4150A237E9E1FF8398AC"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">In the case of a C
corporation which is a community bank, the aggregate tax imposed by this
section, section 55, and section 1201 shall be 80 percent of the aggregate tax
which would (but for this subsection) be imposed by such sections.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="HF69A21D2789547268BD600DCED998E97"><enum>(2)</enum><header>Maximum
reduction</header>
<subparagraph commented="no" display-inline="no-display-inline" id="idD2CA59B1BAC54E27B3409C9F0071BA5E"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The reduction in tax
by reason of this subsection shall not exceed $250,000.</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id949B648DBD39438C853E2FA7BE1EAAEA"><enum>(B)</enum><header>Corporations
treated as <enum-in-header>1</enum-in-header> corporation</header><text display-inline="yes-display-inline">Corporations treated as 1 corporation under
section 1202(d)(3) shall be so treated under this subsection, and the
limitation under subparagraph (A) shall be allocated among such corporations in
such manner as the Secretary shall prescribe.</text>
</subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="HE2DE03895B824A96A9A9E3A7802EA54E"><enum>(3)</enum><header>Increased
benefit for banks operating in distressed areas, etc</header>
<subparagraph commented="no" display-inline="no-display-inline" id="H9FF4C8CCF5FC427DB7A168308590B184"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">In the case of a bank
operating in an area referred to in subparagraph (B)—</text>
<clause commented="no" display-inline="no-display-inline" id="HDD4ED8DF6AB4446DA993CC2DEDCE583E"><enum>(i)</enum><text display-inline="yes-display-inline">paragraph (1) shall be applied by
substituting <quote>50 percent</quote> for <quote>80 percent</quote>,
and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H5C5DF5EDED67493792F7C6A1D4ED3D37"><enum>(ii)</enum><text display-inline="yes-display-inline">paragraph (2)(A) shall be applied by
substituting <quote>$500,000</quote> for <quote>$250,000</quote>.</text>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="HA8B33FEEBA4F4A5BBFE37DD331868DA8"><enum>(B)</enum><header>Areas
described</header><text display-inline="yes-display-inline">The areas referred
to in this subparagraph are—</text>
<clause commented="no" display-inline="no-display-inline" id="H5981A08E96D44C00B7296133F8718465"><enum>(i)</enum><text display-inline="yes-display-inline">empowerment zones and enterprise
communities designated under section 1391,</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H11B5099D24274ED299626347A71D1FF4"><enum>(ii)</enum><text display-inline="yes-display-inline">renewal communities designated under
section 1400E,</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H32E96EDE187247CBBB00E7CE31F18C89"><enum>(iii)</enum><text display-inline="yes-display-inline">low-income communities (as defined in
section 45D(e)), and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H8DA429FE3D174545A6C2E9000096C3D7"><enum>(iv)</enum><text display-inline="yes-display-inline">distressed communities (within the meaning
of section 233 of the Bank Enterprise Act of 1991 (12 U.S.C. 1834a(b)).</text>
</clause></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="H669D5219E9C64680907C00B0AA2BFAE9"><enum>(4)</enum><header>Community
bank</header><text display-inline="yes-display-inline">For purposes of this
section, the term <quote>community bank</quote> means any of the following
entities the gross assets of which (determined under the rules of section
1202(d)) are $5,000,000,000 or less:</text>
<subparagraph commented="no" display-inline="no-display-inline" id="H04CAB604EFB14D87AE0000E29ED3EE1C"><enum>(A)</enum><text display-inline="yes-display-inline">Any bank (as defined in section
581).</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H7BFB322BC07F44829FD944985E5877C0"><enum>(B)</enum><text display-inline="yes-display-inline">Any bank holding company (as defined in
section 2(a) of the Bank Holding Company Act of 1956 (12 U.S.C.
1841(a))).</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H5670A555F1C34D4FB874BEDB4690AD73"><enum>(C)</enum><text display-inline="yes-display-inline">Any savings association (as defined in
section 3(b) of the Federal Deposit Insurance Act (12 U.S.C. 1813)).</text>
</subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H7602CE41FC014C5B85A8E508346E0000"><enum>(D)</enum><text display-inline="yes-display-inline">Any savings and loan holding company (as
defined in section 10(a)(1)(D) of the Home Owners Loan
Act).</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HB2075EB162534EC194A93E3741F6B890"><enum>(b)</enum><header>S
corporations</header><text display-inline="yes-display-inline">Section 1366(a)
of the Internal Revenue Code of 1986 is amended by adding at the end the
following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HF87F17B93EAA4099BFDEFD10CA1DFD87" style="OLC">
<paragraph commented="no" display-inline="no-display-inline" id="HF5D2A17FB1E84EBD8742439F45D0EAB5"><enum>(3)</enum><header>Reduction of tax
on community banks</header>
<subparagraph commented="no" display-inline="no-display-inline" id="HDCB67458331E49208DB248881D7CF728"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">In the case of an S
corporation which is a community bank (as defined in section 11(e)(4)), the net
amount required to be taken into account by shareholders (without regard to
this paragraph) shall be reduced by the lesser of—</text>
<clause commented="no" display-inline="no-display-inline" id="HF7F359136A1C4FB2B9E75C456C2D6530"><enum>(i)</enum><text display-inline="yes-display-inline">20 percent of such net amount, or</text>
</clause><clause commented="no" display-inline="no-display-inline" id="HCE6649EA117447738025CE8113D84398"><enum>(ii)</enum><text display-inline="yes-display-inline">$1,250,000.</text>
</clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="H90F6A0C717624A119851275F407F0098"><enum>(B)</enum><header>Increased
benefit for banks operating in distressed areas, etc</header><text display-inline="yes-display-inline">In the case of a bank operating in an area
referred to in section 11(e)(3)(B)—</text>
<clause commented="no" display-inline="no-display-inline" id="HBEEBA0171325481F9131B600DED9F900"><enum>(i)</enum><text display-inline="yes-display-inline">subparagraph (A)(i) shall be applied by
substituting <quote>50 percent</quote> for <quote>20 percent</quote>,
and</text>
</clause><clause commented="no" display-inline="no-display-inline" id="H89BB274B64134A0BADC97C5E8F890000"><enum>(ii)</enum><text display-inline="yes-display-inline">subparagraph (A)(ii) shall be applied by
substituting <quote>$2,500,000</quote> for
<quote>$1,250,000</quote>.</text>
</clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HF460A44C43BB4012B66556CBADE85200"><enum>(c)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to taxable years beginning after the date of the
enactment of this Act.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="H2523194CF31845E4B11CDE1380005528" section-type="subsequent-section"><enum>402.</enum><header>Community banks
exempt from minimum tax</header>
<subsection commented="no" display-inline="no-display-inline" id="H50CB0ED94C114F0D9723E01D5F0750C5"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 55 of the
Internal Revenue Code of 1986 (relating to alternative minimum tax imposed) is
amended by adding at the end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="HAEE7338C602D4FAA93803244D02B1731" style="OLC">
<subsection commented="no" display-inline="no-display-inline" id="H719B43D244F441F200F14D3C791F6212"><enum>(f)</enum><header>Exemption for
community banks</header>
<paragraph commented="no" display-inline="no-display-inline" id="HF97ABCA49A584FE48912A17F3FF6C4F2"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">The tentative minimum
tax of a community bank (as defined in section 11(e)(4)) shall be zero.</text>
</paragraph><paragraph commented="no" display-inline="no-display-inline" id="H3F22D8AB11544643BCE65856EE6E7059"><enum>(2)</enum><header>Certain rules to
apply</header><text display-inline="yes-display-inline">Rules similar to the
rules of paragraphs (2) through (5) of subsection (e) shall apply for purposes
of this
subsection.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" display-inline="no-display-inline" id="HCC98638BE2DC49EF8571C487CAA0CFB7"><enum>(b)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The amendments made by
this section shall apply to taxable years beginning after the date of the
enactment of this Act.</text>
</subsection></section>