[Congressional Record Volume 149, Number 168 (Wednesday, November 19, 2003)]
[Extensions of Remarks]
[Page E2333]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


[[Page E2333]]
    A BILL TO EXPAND THE TAX BENEFITS FOR THE NEW YORK LIBERTY ZONE

                                 ______
                                 

                           HON. AMO HOUGHTON

                              of new york

                    in the house of representatives

                       Tuesday, November 18, 2003

  Mr. HOUGHTON. Mr. Speaker, today I am joined by my colleague from New 
York, Mr. Rangel, in introducing a bill to extend the period that the 
New York Liberty Zone bonds can be issued by New York State and New 
York City, and to make other changes that would enhance the tax 
provisions that were included in the original New York Liberty Zone 
Benefits legislation. The provisions were part of the Job Creation and 
Worker Assistance Act of 2002, enacted on March 9, 2002, in order to 
aid in the rebuilding of downtown New York City after the devastation 
caused by the September 11, 2001, terrorist attack.
  A loud thank you to the Congress for passing the original 
legislation. The benefits contained in the package were important and 
needed. The Liberty bonds have been an invaluable tool for those 
developments already assisted. They have been utilized, but not to the 
full extent, primarily due to the economic downturn that was underway 
and accelerated after the tragedy. While the market for new commercial 
real estate has been weak, it is estimated the bond allocation for 
residential projects will be exhausted by the end of next year.
  The changes requested include: (1) extend the Liberty bonds 
expiration date to December 31, 2009 from December 31, 2004 to reflect 
a more realistic time line for the recovery of the commercial real 
estate market in New York City, (2) increase the amount of the Liberty 
bonds that can be used for residential development projects from $1.6 
billion to $3.0 billion to provide more flexibility to accommodate 
greater than expected demand for new housing in Lower Manhattan, (3) 
eliminate the 100,000 square foot minimum for non-public utility 
projects outside the Liberty Zone, which has greatly hindered the 
development of much needed smaller utility projects, and (4) a 
technical correction to Section 1400L(c), which would permit eligible 
entities to ``opt out'' of the mandatory provision stating that 
taxpayers must depreciate their Liberty Zone leasehold improvements 
over an accelerated five year term. The latter change would be 
retroactive and would be consistent with other similar accelerated 
depreciation laws, and allows taxpayers to depreciate property over the 
normal depreciation period.
  These changes are in the spirit of the original legislation. They 
merely reflect the different conditions, which exist now that did not 
exist in March of 2002. So in essence, we believe they are important to 
the recovery of New York City. They will help to ensure the full 
utilization of the tax benefits provided in the original Liberty Zone 
legislation. We urge our colleagues to support this important 
legislation.

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