[Congressional Record Volume 145, Number 114 (Thursday, August 5, 1999)]
[Senate]
[Pages S10476-S10480]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BAUCUS (for himself and Mr. Hatch):
  S. 1558. A bill to amend the Internal Revenue Code of 1986 to provide 
a tax credit for holders of Community Open Space bonds the proceeds of 
which are used for qualified environmental infrastructure projects, and 
for other purposes; to the Committee on Commerce, Science, and 
Transportation.


                 community open space bonds act of 1999

  Mr. BAUCUS. Mr. President, I am pleased to introduce the Community 
Open Space Bonds Act of 1999 with my colleague, the senior Senator from 
Utah. This bill is designed to give state and local governments more 
resources to protect open space, preserve water quality, and redevelop 
brownfield sites. It provides communities with zero-cost financing 
options for those activities in an entirely voluntary and locally-
driven way. There is no Federal land-use planning involved.
  The demand for these kinds of community-protection and quality of 
life activities is plain to see. Open space ballot initiatives in last 
year's elections were hugely successful. States and local governments 
set aside nearly $7.5 billion over the next several years to deal with 
environmental issues raised by growth. Smart growth planning ideas are 
sweeping the nation. States are steering their investments to 
preserving open space and encouraging smarter development.
  These ideas are coming straight from state and local officials and 
community leaders. People are discussing how they want their 
communities to look and feel for the first time in decades. Last fall, 
a state-wide conference in my home state entitled ``Big Sky or Big 
Sprawl'' brought together Montanans from all over the state to exchange 
ideas on how to prepare for growth and keep our state ``the last best 
place.''
  This new attention to the impacts of growth is happening for many 
reasons. Some claim that transportation planning has not kept up with 
communities' needs for choices and access, causing congestion and lost 
productivity. Some say that building codes and subdivision regulations 
have encouraged the development of agricultural and open space areas at 
the expense of existing suburbs. Some maintain that the tax code drives 
development in outlying areas while urban and downtown business 
districts fail. Others suggest that the Federal government's policies 
on location of post offices and Federal offices has pushed growth out 
of small and large cities alike.
  Whatever the cause, growth is exploding across the land. For 
instance, Los Angeles' land use grew by 300 percent between 1970 and 
1990, while population grew by only 45 percent. In the same period, 
Cleveland actually lost 11 percent of its population, but grew by 33 
percent in size.
  The problem is not growth per se, but the inefficient way that 
current growth is using today's infrastructure. Some cities like 
Bozeman, Montana, have had to resort to impact assessment fees in the 
outlying areas so that the established city's system would not have to 
subsidize growth away from the already built up areas. The challenge is 
to encourage growth while maintaining open space and other factors that 
make our communities desirable places to live and work.
  Because of our quality of life in the West, people are moving there 
in droves. We pride ourselves on having lots of space and we want 
growth.
  But, growth in environmentally sensitive and water restricted areas 
poses some unique problems. We have vast amounts of public land that 
are getting harder and harder to access as growth crowds these areas. 
That means fewer hunters, fishermen, hikers, and outdoor enthusiasts, 
can use these lands easily.
  One result of this growth is that the character of the West is 
changing rapidly. For instance, Montana grew faster than the rest of 
the nation in the 1990s. That rate of growth, especially when it is 
concentrated in a small number of areas, concerns people. They start 
turning to their state and local government representatives for action 
to preserve the character of their communities.
  A recent poll showed that most Americans believe that government at 
all levels could do a better job of protecting and creating parks and 
conserving open space. That same poll showed that they are willing to 
pay for such programs and that they view these programs as a relatively 
high priority. Leaders at all levels of government should heed these 
results.
  Mr. President, the bill we are introducing today is intended to help 
address this need. We want to give communities the flexible resources 
they need to creatively manage growth-related problems at the local 
level.

[[Page S10477]]

  In developing the Community Open Space Bonds Act of 1999, we started 
with the proposal included in the Administration's FY2000 budget 
request. We have improved upon it to make it more responsive to local 
needs and to be equitable in its treatment of small and Western 
communities.
  However, the basic idea is still the same. States and local 
governments, including tribal governments, can compete for the 
authority to issue bonds on which the Federal government will pay the 
interest costs. The proceeds from the sale of the bonds can be used to 
acquire open space, build parks, protect water quality, improve access 
to public lands and redevelop brownfield areas. Up to $1.9 billion in 
bonding authority could be issued over each of the next five years. The 
Federal government would pay the interest costs by giving bondholders a 
tax credit against their income at the corporate AA credit rate.
  Rather than having Federal agencies making all the decisions about 
who gets bonding authority, we are establishing a Community Open Space 
Bonds Board. This Board will be dominated by non-Federal interest, such 
as Governors, County Commissioners, Mayors, etc. and will be given 
specific guidance to use in developing application criteria. This 
guidance will stress the need for an equitable distribution of bonding 
authority to all regions of the country and to all sizes of communities 
and for all the different qualifying purposes. We have also guaranteed 
that each state or a community in such a state will get at least one 
allocation of bonding authority per year.
  We think these modifications improve the original proposal and are 
worthy of support by our colleagues from both sides of the aisle. We 
stand ready to work with them to address their concerns and get this 
bill enacted.
  Mr. President, local governments across the country are looking for 
new and low-cost ways to maintain and preserve the quality of life in 
their area. Community Open Space Bonds are a great opportunity for all 
our citizens to improve the long term health and economic viability of 
our communities. I am hopeful we can pursue this opportunity in a 
bipartisan and constructive way.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1558

       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 ``Community Open Space Bonds 
     Act of 1999''.

     SEC. 2. CREDIT FOR HOLDERS OF COMMUNITY OPEN SPACE BONDS.

       (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:

 ``Subpart H--Nonrefundable Credit for Holders of Community Open Space 
                                 Bonds

``Sec. 54. Credit to holders of Community Open Space bonds.

     ``SEC. 54. CREDIT TO HOLDERS OF COMMUNITY OPEN SPACE BONDS.

       ``(a) Allowance of Credit.--In the case of a taxpayer who 
     holds a Community Open Space bond on a credit allowance date 
     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 bonds.
       ``(b) Amount of Credit.--
       ``(1) In general.--The amount of the credit determined 
     under this subsection with respect to any credit allowance 
     date for a Community Open Space bond is an amount equal to 
     the product of--
       ``(A) the credit rate determined by the Secretary under 
     paragraph (2), multiplied by
       ``(B) the face amount of the bond held by the taxpayer on 
     the credit allowance date.
       ``(2) Determination.--During each calendar month, the 
     Secretary shall determine a credit rate which shall apply to 
     bonds issued during the following calendar month. The credit 
     rate for any 3-month period ending on a credit allowance date 
     is the percentage which the Secretary estimates will on 
     average equal the yield on corporate bonds outstanding on the 
     day before the date of such determination.
       ``(3) 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.
       ``(c) Limitation Based on Amount of Tax.--
       ``(1) In general.--The credit allowed under subsection (a) 
     for any taxable year shall not exceed the excess of--
       ``(A) the sum of the regular tax liability (as defined in 
     section 26(b)) plus the tax imposed by section 55, over
       ``(B) the sum of the credits allowable under this part 
     (other than this subpart and subpart C).
       ``(2) Carryforward 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 each of the 5 taxable years following the unused 
     credit year and added to the credit allowable under 
     subsection (a) for each such taxable year, subject to the 
     application of paragraph (1) to such taxable year.
       ``(d) Community Open Space Bond.--For purposes of this 
     section--
       ``(1) In general.--The term `Community Open Space bond' 
     means any bond issued as part of an issue if--
       ``(A) 95 percent or more of the proceeds of such issue are 
     to be used for a qualified environmental infrastructure 
     project,
       ``(B) the bond is issued by a State or local government,
       ``(C) the issuer--
       ``(i) designates such bond for purposes of this section,
       ``(ii) has a reasonable expectation that at least 10 
     percent of the proceeds of such issue will be spent for 
     qualifying environmental infrastructure projects within 6 
     months of the date such bonds are issued,
       ``(iii) certifies such proceeds will be used with due 
     diligence for qualified environmental infrastructure 
     projects, and
       ``(iv) has a reasonable expectation that any property 
     acquired or improved in connection with the proceeds of such 
     issue, other than property improved in connection with a 
     qualified environmental infrastructure project described in 
     paragraph (2)(A)(v), shall continue to be dedicated to a 
     qualified use for a period of not less than 15 years from the 
     date of such issue,
       ``(D) such bond satisfies public approval requirements 
     similar to the requirements of section 147(f)(2),
       ``(E) except as provided in paragraph (4)(B), the payment 
     of the principal of such issue is secured by taxes of general 
     applicability imposed by a general purpose governmental unit, 
     and
       ``(F) the term of each bond which is part of such issue 
     does not exceed 15 years.
       ``(2) Qualified environmental infrastructure project.--
       ``(A) In general.--The term `qualified environmental 
     infrastructure project' means--
       ``(i) acquisition of qualified property for use as open 
     space, wetlands, public parks, or greenways, or to improve 
     access to public lands by non-motorized means,
       ``(ii) construction, rehabilitation, or repair of a visitor 
     facility in connection with qualified property, including 
     nature centers, campgrounds, and hiking or biking trails,
       ``(iii) remediation of qualified property to enhance water 
     quality by--

       ``(I) restoring natural hydrology or planting trees and 
     streamside vegetation,
       ``(II) controlling erosion,
       ``(III) restoring wetlands, or
       ``(IV) treating conditions caused by the prior disposal of 
     toxic or other waste,

       ``(iv) acquisition of a qualified easement in order to 
     maintain the use and character of the property in connection 
     to which such easement is granted as open space, including an 
     easement to allow access to public land by non-motorized 
     means, and
       ``(v) environmental assessment and remediation of real 
     property and public infrastructure owned by a governmental 
     unit and located in an area where or on which there has been 
     a release (or threat of release) or disposal of any hazardous 
     substance (within the meaning of section 198), but not 
     including any property described in subparagraph (D).
       ``(B) Qualified property.--The term `qualified property' 
     means real property--
       ``(i) which is, or is to be, owned by--

       ``(I) a governmental unit, or
       ``(II) an organization described in section 501(c)(3) and 
     exempt from taxation under section 501(a) and which has as 
     one if its purposes environmental preservation, and

       ``(ii) which is reasonably anticipated to be available for 
     use by members of the general public, unless such use would 
     change the character of the property and be contrary to the 
     qualified use of the property.
       ``(C) Safe harbor for management contracts.--For purposes 
     of subparagraph (B), property shall not be treated as 
     qualified property if any rights or benefits of such property 
     inure to a private person other than rights or benefits under 
     a management contract or similar type of operating agreement 
     to which rules similar to the rules applicable to tax-exempt 
     bonds apply.
       ``(D) Cercla property.--Property is described in this 
     subparagraph if any portion of such property is included, or 
     proposed to be included, in the national priorities list 
     under section 105(a)(8)(B) of the Comprehensive Environmental 
     Response, Compensation, and Liability Act of 1980 (42 U.S.C. 
     9605(a)(8)(B)).
       ``(E) Limit on disposition of property.--Any disposition of 
     any interest in property

[[Page S10478]]

     acquired or improved in connection with a qualified 
     environmental project described in this paragraph (except a 
     project described in subparagraph (A)(v)) shall contain an 
     option (recorded pursuant to applicable State or local law) 
     to purchase such property for an amount equal to the original 
     acquisition price of such property for any interested 
     organizations described in subparagraph (B)(i)(II) if such 
     organization purchases such property subject to a restrictive 
     covenant requiring a continued qualified use of such 
     property.
       ``(3) Temporary period exception.--
       ``(A) In general.--A bond shall not be treated as failing 
     to meet the requirement of paragraph (1)(A) solely by reason 
     of the fact that the proceeds of the issue of which such bond 
     is a part--
       ``(i) are invested for a reasonable temporary period (but 
     not more than 36 months) until such proceeds are needed for 
     the purpose for which such issue was issued, or
       ``(ii) are used within 90 days of the close of such 
     temporary period to redeem bonds which are a part of such 
     issue.
     Any earnings on such proceeds during the period under clause 
     (i) shall be treated as proceeds of the issue for purposes of 
     applying paragraph (1)(A).
       ``(B) Investment of proceeds.--For purposes of subparagraph 
     (A), proceeds shall only be invested in--
       ``(i) Government securities, and
       ``(ii) in the case of a sinking fund established by the 
     issuer, State and local government securities issued by the 
     Treasury.
       ``(4) Special rules for projects described in paragraph 
     (2)(A)(v).--
       ``(A) Limit on use of proceeds for project.--This 
     subsection shall not apply to any bond issued as part of an 
     issue if an amount of the proceeds from such issue are used 
     for a qualified environmental infrastructure project 
     described in paragraph (2)(A)(v) and involving public 
     infrastructure in excess of an amount equal to 5 percent of 
     the total amount of such proceeds used for all projects 
     described in such paragraph (2)(A)(v).
       ``(B) Private use and repayment of proceeds.--In the case 
     of proceeds of an issue which are used for a qualified 
     environmental infrastructure project described in paragraph 
     (2)(A)(v), the issue of which such bonds are a part shall not 
     fail to meet the requirements of this subsection solely 
     because the proceeds of a disposition of any interest in such 
     property are used to redeem such bonds as long as the 
     purchaser of such property makes an irrevocable election not 
     to claim any deduction with respect to such project under 
     section 198.
       ``(5) Recapture of credit amount.--
       ``(A) In general.--If, during the taxable year, any bond 
     that is part of an issue under this section fails to meet the 
     requirements of this subsection--
       ``(i) such bond shall not be treated as a Community Open 
     Space bond for such taxable year and any succeeding taxable 
     year, and
       ``(ii) the issuer of such bond shall be liable for payment 
     to the United States of the credit recapture amount.
     Such payment shall be made at such time and in such manner as 
     determined by the Secretary.
       ``(B) Credit recapture amount.--For purposes of 
     subparagraph (A), the credit recapture amount is an amount 
     equal to the sum of--
       ``(i) the aggregate amount of credit allowed with respect 
     to such bond for the 3 preceding taxable years, plus
       ``(ii) interest (at the underpayment rate established under 
     section 6621) on the credit amount from the date such credit 
     was allowed to the payment date under subparagraph (A).
       ``(e) Limitations on Amount of Bonds Designated.--
       ``(1) In general.--There is a Community Open Space bond 
     limitation for each calendar year equal to--
       ``(A) $1,900,000,000 for each of years 2000 through 2004, 
     and
       ``(B) except as provided in paragraph (3), zero after 2004.
       ``(2) Allocation of limitation among states and local 
     governments.--
       ``(A) In general.--The limitation amount to be allocated 
     under paragraph (1) for any calendar year shall be allocated 
     among States and local governments with an approved 
     application on a competitive basis by the Community Open 
     Space Bonds Board (referred to in this subsection as the 
     `Board') established under section 3 of the Community Open 
     Space Bonds Act of 1999.
       ``(B) Approved application.--For purposes of subparagraph 
     (A), the term `approved application' means an application 
     which is approved by the Board, and which includes such 
     information as the Board requires.
       ``(C) Allocation to each state.--The Board shall, in 
     accordance with the criteria for approval of applications, 
     allocate amounts in any calendar year to at least 1 approved 
     application from each State, or local government of such 
     State, which submits such application.
       ``(3) Carryover of unused limitation.--If for any calendar 
     year--
       ``(A) the limitation amount under paragraph (1), exceeds
       ``(B) the aggregate limitation amount allocated to States 
     and local governments under this section,
     the limitation amount under paragraph (1) for the following 
     calendar year shall be increased by the amount of such 
     excess. No limitation amount shall be carried forward under 
     this paragraph more than 3 years.
       ``(f) Other Definitions; Special Rules.--For purposes of 
     this subpart--
       ``(1) Bond.--The term `bond' includes any obligation.
       ``(2) Credit allowance date.--The term `credit allowance 
     date' means--
       ``(A) March 15,
       ``(B) June 15,
       ``(C) September 15, and
       ``(D) December 15.
     Such term includes the last day on which the bond is 
     outstanding.
       ``(3) Qualified easement.--The term `qualified easement' 
     means a perpetual easement--
       ``(A) which would be a qualified conservation contribution 
     under section 170(h) if such easement were a contribution 
     under such section, and
       ``(B) which is to be held by an entity described in 
     subclause (I) or (II) of subsection (d)(2)(B)(i).
       ``(4) Qualified use.--The term `qualified use' means, with 
     respect to property, a use which is consistent with the 
     purpose of the qualified environmental infrastructure project 
     related to such property.
       ``(5) State.--The term `State' includes the District of 
     Columbia, any possession of the United States, and any Indian 
     tribe (as defined in section 45A(c)(6)).
       ``(6) 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).
       ``(g) Credit Included in Gross Income.--Gross income 
     includes the amount of the credit allowed to the taxpayer 
     under this section and the amount so included shall be 
     treated as interest income.
       ``(h) Bonds Held By Regulated Investment Companies.--If any 
     Community Open Space 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.
       ``(i) Credits May Be Stripped.--Under regulations 
     prescribed by the Secretary--
       ``(1) In general.--There may be a separation (including at 
     issuance) of the ownership of a Community Open Space bond and 
     the entitlement to the credit under this section with respect 
     to such bond. In case of any such separation, the credit 
     under this section shall be allowed to the person which, on 
     the credit allowance date, holds the instrument evidencing 
     the entitlement to the credit and not to the holder of the 
     bond.
       ``(2) Certain rules to apply.--In the case of a separation 
     described in paragraph (1), the rules of section 1286 shall 
     apply to the Community Open Space bond as if it were a 
     stripped bond and to the credit under this section as if it 
     were a stripped coupon.
       ``(j) Treatment for Estimated Tax Purposes.--Solely for 
     purposes of sections 6654 and 6655, the credit allowed by 
     this section to a taxpayer by reason of holding a Community 
     Open Space 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.
       ``(k) Credit May Be Transferred.--Nothing in any law or 
     rule of law shall be construed to limit the transferability 
     of the credit allowed by this section through sale and 
     repurchase agreements.
       ``(l) Reporting.--Issuers of Community Open Space bonds 
     shall submit reports similar to the reports required under 
     section 149(e).''
       (b) 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:
       ``(8) Reporting of Credit on Community Open Space Bonds.--
       ``(A) In general.--For purposes of subsection (a), the term 
     `interest' includes amounts includible in gross income under 
     section 54(f) and such amounts shall be treated as paid on 
     the credit allowance date (as defined in section 54(f)(2)).
       ``(B) Reporting to corporations, etc.--Except as otherwise 
     provided in regulations, in the case of any interest 
     described in subparagraph (A) of this paragraph, subsection 
     (b)(4) of this section shall be applied without regard to 
     subparagraphs (A), (H), (I), (J), (K), and (L)(i).
       ``(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.''
       (c) Clerical Amendments.--
       (1) The table of subparts for part IV of subchapter A of 
     chapter 1 of the Internal Revenue Code of 1986 is amended by 
     adding at the end the following:

``Subpart H. Nonrefundable Credit for Holders of Community Open Space 
              Bonds.''

       (2) Section 6401(b)(1) of such Code is amended by striking 
     ``and G'' and inserting ``G, and H''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to obligations issued after December 31, 1999.

     SEC. 3. COMMUNITY OPEN SPACE BONDS BOARD.

       (a) Establishment.--There is established in the Executive 
     Branch a board to be known

[[Page S10479]]

     as the Community Open Space Bonds Board (in this section 
     referred to as the ``Board'').
       (b) Membership.--
       (1) Composition.--The Board shall be composed of 18 
     members, as follows:
       (A) 3 members shall be individuals who are not otherwise 
     Federal officers or employees and who are appointed by the 
     President, by and with the advice and consent of the Senate.
       (B) 8 members, not be affiliated with the same political 
     party, shall be individuals who represent Governors, or other 
     chief executive officers, of a State, mayors, and county 
     commissioners and who are appointed by the President, by and 
     with the advice and consent of the Senate.
       (C) 1 member shall be the Administrator of the 
     Environmental Protection Agency or the Administrator's 
     designee.
       (D) 1 member shall be the Secretary of Agriculture or the 
     Secretary's designee.
       (E) 1 member shall be the Secretary of Housing and Urban 
     Development or the Secretary's designee.
       (F) 1 member shall be the Secretary of Interior or the 
     Secretary's designee.
       (G) 1 member shall be the Secretary of Transportation or 
     the Secretary's designee.
       (H) 1 member shall be the Secretary of the Treasury or the 
     Secretary's designee.
       (I) 1 member shall be the Director of the Federal Emergency 
     Management Agency or the Director's designee.
       (2) Qualifications and terms.--
       (A) Qualifications.--Members of the Board described in 
     paragraph (1)(A) shall be appointed without regard to 
     political affiliation and solely on the basis of their 
     professional experience and expertise in 1 or more of the 
     following areas:
       (i) Tax-exempt organizations which have as a principal 
     purpose environmental protection and land conservation.
       (ii) Community planning.
       (iii) Real estate investment and bond financing.

     In the aggregate, the members of the Board described in 
     paragraph (1)(A) should collectively bring to bear expertise 
     in all of the areas described in the preceding sentence and 
     should represent each position contained in such paragraph 
     and different regions of the country.
       (B) Terms.--Each member who is described in subparagraph 
     (A) or (B) of paragraph (1) shall be appointed for a term of 
     3 years, except that of the members first appointed--
       (i) 3 member shall be appointed for a term of 1 year,
       (ii) 4 members shall be appointed for a term of 2 years, 
     and
       (iii) 4 members shall be appointed for a term of 3 years.
       (C) Reappointment.--An individual who is described in 
     subparagraph (A) or (B) of paragraph (1) may be appointed to 
     no more than one 3-year term on the Board.
       (D) Vacancy.--Any vacancy on the Board shall be filled in 
     the same manner as the original appointment. Any member 
     appointed to fill a vacancy occurring before the expiration 
     of the term for which the member's predecessor was appointed 
     shall be appointed for the remainder of that term.
       (3) Initial meeting.--Not later than 30 days after the date 
     on which all members of the Board have been appointed, the 
     Board shall hold its first meeting. Subsequent meetings shall 
     be determined by the Board by majority vote or held at the 
     call of the Chairperson.
       (4) Quorum.--A majority of the members of the Board shall 
     constitute a quorum, but a lesser number of members may hold 
     hearings.
       (5) Chairperson.--The member described in paragraph (1)(C) 
     shall serve as the Chairperson of the Board.
       (6) Removal.--
       (A) In general.--Any member of the Board appointed under 
     subparagraph (A) or (B) of paragraph (1) may be removed at 
     the will of the President.
       (B) Secretaries; director; administrator.--An individual 
     described in subparagraphs (C) through (I) of paragraph (1) 
     shall be removed upon termination of service in the office 
     described in each such subparagraph.
       (c) Duties of the Board.--
       (1) In general.--The Board shall review applications for 
     allocation of the Community Open Space bond limitation 
     amounts under section 54(e)(2) of the Internal Revenue Code 
     of 1986 and approve applications in accordance with published 
     criteria.
       (2) Criteria for approval.--The Board shall promulgate a 
     regulation to develop criteria for approval of applications 
     under paragraph (1), taking into consideration the following 
     guidelines:
       (A) A distribution pattern of the overall limitation amount 
     available for the year which results in the financing of each 
     category of qualified environmental infrastructure project 
     and results in an even distribution among different regions 
     of the country and sizes of communities.
       (B) State or local government support of proposed projects.
       (C) Proposed projects which meet local and regional 
     environmental protection or planning goals and leverage or 
     make more efficient or innovative the use of other public or 
     private resources.
       (D) Proposed projects which are intended to maintain the 
     viability of existing central business districts, preserve 
     the community's distinct character and values, and encourage 
     the reuse of property already served by public 
     infrastructure.
       (E) The extent of expected improvement in environmental 
     quality, outdoor recreation opportunities, and access to 
     public lands.
       (3) Annual report.--The Board shall annually report with 
     respect to the conduct of its responsibilities under this 
     section to the President and Congress and such report shall 
     include--
       (A) the overall progress of the Community Open Space bond 
     program, and
       (B) the overall limitation amount allocated during the year 
     and a description of the amount, region, and qualified 
     environmental infrastructure project financed by each 
     allocation.
       (4) Conflict of interest.--The Board shall carry out its 
     duties under this subsection in such a way to ensure that all 
     conflicts of interest of its members are avoided.
       (d) Powers of the Board.--
       (1) Hearings.--The Board may hold such hearings, sit and 
     act at such times and places, take such testimony, and 
     receive such evidence as the Board considers advisable to 
     carry out the purposes of this section.
       (2) Information from federal agencies.--The Board may 
     secure directly from any Federal department or agency such 
     information as the Board considers necessary to carry out the 
     provisions of this section, including the published and 
     unpublished data and analytical products of the Bureau of 
     Labor Statistics. Upon request of the Chairperson of the 
     Board, the head of such department or agency shall furnish 
     such information to the Board.
       (3) Postal services.--The Board may use the United States 
     mails in the same manner and under the same conditions as 
     other departments and agencies of the Federal Government.
       (e) Board Personnel Matters.--
       (1) Compensation of members.--Each member of the Board who 
     is not otherwise an officer or employee of the Federal 
     Government shall be compensated at a rate equal to the daily 
     equivalent of the annual rate of basic pay prescribed for 
     level III of the Executive Schedule under section 5315 of 
     title 5, United States Code, for each day (including travel 
     time) during which such member is engaged in the performance 
     of the duties of the Board. All members of the Board who 
     otherwise are officers or employees of the United States 
     shall serve without compensation in addition to that received 
     for their services as officers or employees of the United 
     States.
       (2) Travel expenses.--The members of the Board shall be 
     allowed travel expenses, including per diem in lieu of 
     subsistence, at rates authorized for employees of agencies 
     under subchapter I of chapter 57 of title 5, United States 
     Code, while away from their homes or regular places of 
     business in the performance of services for the Board.
       (3) Staff.--
       (A) In general.--The Chairperson of the Board may, without 
     regard to the civil service laws and regulations, appoint and 
     terminate an executive director and such other additional 
     personnel as may be necessary to enable the Board to perform 
     its duties. The employment of an executive director shall be 
     subject to confirmation by the Board.
       (B) Compensation.--The Chairperson of the Board may fix the 
     compensation of the executive director and other personnel 
     without regard to the provisions of chapter 51 and subchapter 
     III of chapter 53 of title 5, United States Code, relating to 
     classification of positions and General Schedule pay rates, 
     except that the rate of pay for the executive director and 
     other personnel may not exceed the rate payable for level IV 
     of the Executive Schedule under section 5316 of such title.
       (4) Detail of government employees.--Any Federal Government 
     employee may be detailed to the Board without additional 
     reimbursement (other than the employee's regular 
     compensation), and such detail shall be without interruption 
     or loss of civil service status or privilege.
       (5) Procurement of temporary and intermittent services.--
     The Chairperson of the Board may procure temporary and 
     intermittent services under section 3109(b) of title 5, 
     United States Code, at rates for individuals which do not 
     exceed the daily equivalent of the annual rate of basic pay 
     prescribed for level V of the Executive Schedule under 
     section 5316 of such title.
       (f) Definitions.--For purposes of this section--
       (1) State.--The term `State' includes the District of 
     Columbia, any possession of the United States, and any Indian 
     tribe (as defined in section 45A(c)(6)).
       (2) Qualified environmental infrastructure project.--The 
     term `qualified environmental infrastructure project' has the 
     same meaning given that term in section 54(d)(2) of the 
     Internal Revenue Code of 1986.
       (g) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Board such sums as are necessary to 
     carry out the purposes of this section.
       (h) Effective Dates.--
       (1) In general.--The amendments made by this section shall 
     take effect on the date of the enactment of this Act.
       (2) Initial nominations.--The President shall submit the 
     initial nominations under subparagraphs (A) and (B) of 
     subsection (b)(1) to the Senate not later than 90 days after 
     the date of the enactment of this Act.
       (3) Regulations.--Not later than January 1, 2000, the Board 
     shall publish in the Federal

[[Page S10480]]

     Register the guidelines and criteria for submission and 
     approval of applications under subsection (c).
                                 ______