[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 2574 Introduced in Senate (IS)]







110th CONGRESS
  2d Session
                                S. 2574

    To amend the Internal Revenue Code of 1986 to allow the use of 
   qualified mortgage revenue bonds for refinancing mortgages and to 
     provide a temporary increase in the volume cap for such bonds.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 30, 2008

 Mr. Reid (for Mrs. Clinton) introduced the following bill; which was 
          read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
    To amend the Internal Revenue Code of 1986 to allow the use of 
   qualified mortgage revenue bonds for refinancing mortgages and to 
     provide a temporary increase in the volume cap for such bonds.

    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 ``Mortgage Refinancing Initiative Act 
of 2008''.

SEC. 2. USE OF MORTGAGE BONDS FOR REFINANCINGS.

    (a) Temporary Use of Qualified Mortgage Bonds Proceeds for 
Refinancing Existing Mortgages.--Section 143(k) of the Internal Revenue 
Code of 1986 (relating to other definitions and special rules) is 
amended by adding at the end the following new paragraph:
            ``(12) Certain mortgage refinancings allowed.--
                    ``(A) In general.--Notwithstanding the requirements 
                of subsection (i)(1), the proceeds of a qualified 
                mortgage issue may be used to refinance an existing 
                mortgage.
                    ``(B) Special rules.--In applying this paragraph to 
                any case in which the proceeds of a qualified mortgage 
                issue are used for any refinancing described in 
                subparagraph (A)--
                            ``(i) subsection (a)(2)(D)(i) shall be 
                        applied by substituting `12-month period' for 
                        `42-month period' each place it appears,
                            ``(ii) subsection (d) (relating to 3-year 
                        requirement) shall not apply, and
                            ``(iii) subsection (e) (relating to 
                        purchase price requirement) shall be applied by 
                        using the market value of the residence at the 
                        time of refinancing in lieu of the acquisition 
                        cost.
                    ``(C) Termination.--This paragraph shall not apply 
                to any bonds issued after December 31, 2009.''.
    (b) Increased Volume Cap for Refinancings.--
            (1) In general.--Subsection (d) of section 146 of the 
        Internal Revenue Code of 1986 is amended by adding at the end 
        the following new paragraph:
            ``(5) Temporary increase and set aside for mortgage 
        refinancing.--
                    ``(A) In general.--The State ceiling for any State 
                for any calendar year shall be increased by the amount 
                allocated to such State by the Secretary under 
                subparagraph (C).
                    ``(B) Limitation.--There is a national limitation 
                of the increase under this paragraph for all State 
                ceiling for any calendar year. Such limitation is--
                            ``(i) $5,000,000 for calendar year 2008,
                            ``(ii) $5,000,000 for calendar year 2009, 
                        and
                            ``(iii) zero for any calendar year after 
                        2009.
                    ``(C) Allocation by secretary.--Not later than 45 
                days after the date of the enactment of this paragraph, 
                the Secretary shall prescribe regulations for 
                allocating the amount described in subparagraph (B) to 
                States. In determining the allocation of such amounts, 
                the Secretary shall take into consideration, among 
                other things, the severity of the foreclosure rates in 
                the States on the date of the enactment of this 
                paragraph.
                    ``(D) Set aside.--Not less than an amount equal to 
                each State's allocable share of the increase in the 
                State ceiling under subparagraph (A) shall be used 
                solely for the purpose of issuing bonds the proceeds of 
                which are used to refinance existing mortgages.''.
            (2) Carryforward of unused limitations.--Subsection (f) of 
        section 146 of such Code is amended by adding at the end the 
        following new paragraph:
            ``(6) Special rules for increased volume cap under 
        subsection (d)(5).--
                    ``(A) In general.--No amount which is attributable 
                to the increase under subsection (d)(5) may be used for 
                a carryforward purpose other than issuing qualified 
                mortgage bonds.
                    ``(B) Carryforward period.--In applying paragraph 
                (3) to any carryforward which is attributable to the 
                increase under subsection (d)(5), `the next calendar 
                year' shall be substituted for `the 3 calendar years' 
                in subparagraph (A) thereof.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to bonds issued after December 31, 2007.
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