[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6560 Introduced in House (IH)]

112th CONGRESS
  2d Session
                                H. R. 6560

   To amend the Internal Revenue Code of 1986 to allow an additional 
            advance refunding for certain tax-exempt bonds.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 25, 2012

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

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code of 1986 to allow an additional 
            advance refunding for certain tax-exempt 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 ``Local Schools and Infrastructure 
Improvement Act of 2012''.

SEC. 2. ADDITIONAL ADVANCE REFUNDING OF CERTAIN TAX-EXEMPT BONDS.

    (a) In General.--Clause (i) of section 149(d)(3)(A) of the Internal 
Revenue Code of 1986 is amended to read as follows:
                            ``(i) the refunding bond is only the 1st or 
                        2nd advance refunding of the original bond,''.
    (b) Advance Refunding Bond Requirements.--
            (1) In general.--Subparagraph (A) of section 149(d)(3) of 
        such Code is amended by striking ``and'' at the end of clause 
        (iv), by striking the period at the end of clause (v), and by 
        adding at the end the following new clause:
                            ``(vi) in the case of the 2nd advance 
                        refunding of the original bond--
                                    ``(I) the issuer is projected to 
                                realize present value debt service 
                                savings (determined without regard to 
                                administrative expenses) in connection 
                                with the issue of which the refunding 
                                bond is a part,
                                    ``(II) the average maturity date of 
                                the issue of which the refunding bond 
                                is a part is not later than the average 
                                maturity date of the bonds to be 
                                refunded by such issue, and
                                    ``(III) the amount of the refunding 
                                bond does not exceed the outstanding 
                                amount of the refunded bond.
                        For purposes of clause (vi)(II), average 
                        maturity dates shall be determined under rules 
                        similar to the rules of section 172(b)(2).''.
            (2) Exceptions.--Paragraph (3) of section 149(d) of such 
        Code is amended by adding after subparagraph (B) the following 
        new subparagraph:
                    ``(C) Special rule for 2nd advance refundings.--
                Clause (vi) of subparagraph (A) shall not apply in the 
                case of a 2nd advance refunding if--
                            ``(i) the original bond has been redeemed, 
                        or
                            ``(ii) the issuer determines that the 2nd 
                        advance refunding is necessary to avoid or 
                        terminate a default in the payment of debt 
                        service on the refunded bond.''.
    (c) Effective Date.--The amendment made by this section shall apply 
to refunding bonds issued on or after the date of the enactment of this 
Act.
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