[Congressional Record Volume 151, Number 156 (Wednesday, December 7, 2005)]
[House]
[Pages H11152-H11163]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
GULF OPPORTUNITY ZONE ACT OF 2005
Mr. McCRERY. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 4440) to amend the Internal Revenue Code of 1986 to provide
tax benefits for the Gulf Opportunity Zone and certain areas affected
by Hurricanes Rita and Wilma, and for other purposes.
The Clerk read as follows:
H.R. 4440
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; ETC.
(a) Short Title.--This Act may be cited as the ``Gulf
Opportunity Zone Act of 2005''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in this Act an amendment or repeal is
expressed in terms of an amendment to, or repeal of, a
section or other provision, the reference shall be considered
to be made to a section or other provision of the Internal
Revenue Code of 1986.
(c) Table of Contents.--The table of contents of this Act
is as follows:
Sec. 1. Short title; etc.
TITLE I--ESTABLISHMENT OF GULF OPPORTUNITY ZONE
Sec. 101. Tax benefits for Gulf Opportunity Zone.
Sec. 102. Federal guarantee of certain State bonds.
TITLE II--TAX BENEFITS RELATED TO HURRICANES RITA AND WILMA
Sec. 201. Extension of certain emergency tax relief for Hurricane
Katrina to Hurricanes Rita and Wilma.
TITLE III--OTHER PROVISIONS
Sec. 301. Secretarial authority to extend period during which traveling
expenses are treated as incurred away from home in case
of major disaster.
Sec. 302. Gulf Coast Recovery Bonds.
TITLE I--ESTABLISHMENT OF GULF OPPORTUNITY ZONE
SEC. 101. TAX BENEFITS FOR GULF OPPORTUNITY ZONE.
(a) In General.--Subchapter Y of chapter 1 is amended by
adding at the end the following new part:
``PART II--TAX BENEFITS FOR GULF OPPORTUNITY ZONE
``Sec. 1400M. Definitions.
``Sec. 1400N. Tax benefits for Gulf Opportunity Zone.
``SEC. 1400M. DEFINITIONS.
``For purposes of this part--
``(1) Gulf opportunity zone.--The terms `Gulf Opportunity
Zone' and `GO Zone' mean that portion of the Hurricane
Katrina disaster area determined by the President to warrant
individual or individual and public assistance from the
Federal Government under the Robert T. Stafford Disaster
Relief and Emergency Assistance Act by reason of Hurricane
Katrina.
``(2) Hurricane katrina disaster area.--The term `Hurricane
Katrina disaster area' means an area with respect to which a
major disaster has been declared by the President before
September 14, 2005, under section 401 of such Act by reason
of Hurricane Katrina.
``(3) Rita go zone.--The term `Rita GO Zone' means that
portion of the Hurricane Rita disaster area determined by the
President to warrant individual or individual and public
assistance from the Federal Government under such Act by
reason of Hurricane Rita.
``(4) Hurricane rita disaster area.--The term `Hurricane
Rita disaster area' means an area with respect to which a
major disaster has been declared by the President, before
October 6, 2005, under section 401 of such Act by reason of
Hurricane Rita.
``(5) Wilma go zone.--The term `Wilma GO Zone' means that
portion of the Hurricane Wilma disaster area determined by
the President to warrant individual or individual and public
assistance from the Federal Government under such Act by
reason of Hurricane Wilma.
``(6) Hurricane wilma disaster area.--The term `Hurricane
Wilma disaster area' means an area with respect to which a
major disaster has been declared by the President, before
November 14, 2005, under section 401 of such Act by reason of
Hurricane Wilma.
``SEC. 1400N. TAX BENEFITS FOR GULF OPPORTUNITY ZONE.
``(a) Tax-Exempt Bond Financing.--
``(1) In general.--For purposes of this title--
``(A) any qualified Gulf Opportunity Zone Bond described in
paragraph (2)(A)(i) shall be treated as an exempt facility
bond, and
``(B) any qualified Gulf Opportunity Zone Bond described in
paragraph (2)(A)(ii) shall be treated as a qualified mortgage
bond.
``(2) Qualified gulf opportunity zone bond.--For purposes
of this subsection, the
[[Page H11153]]
term `qualified Gulf Opportunity Zone Bond' means any bond
issued as part of an issue if--
``(A)(i) 95 percent or more of the net proceeds (as defined
in section 150(a)(3)) of such issue are to be used for
qualified project costs, or
``(ii) such issue meets the requirements of a qualified
mortgage issue, except as otherwise provided in this
subsection,
``(B) such bond is issued by the State of Alabama,
Louisiana, or Mississippi, or any political subdivision
thereof,
``(C) such bond is designated for purposes of this section
by--
``(i) in the case of a bond which is required under State
law to be approved by the bond commission of such State, such
bond commission, and
``(ii) in the case of any other bond, the Governor of such
State, and
``(D) such bond is issued after the date of the enactment
of this section and before January 1, 2011.
``(3) Limitations on bonds.--
``(A) Aggregate amount designated.--The maximum aggregate
face amount of bonds which may be designated under this
subsection with respect to any State shall not exceed the
product of $2,500 multiplied by the portion of the State
population which is in the Gulf Opportunity Zone (as
determined on the basis of the most recent census estimate of
resident population released by the Bureau of Census before
August 28, 2005).
``(B) Movable property.--No bonds shall be issued which are
to be used for movable fixtures and equipment.
``(4) Qualified project costs.--For purposes of this
subsection, the term `qualified project costs' means the cost
of acquisition, construction, reconstruction, and renovation
of--
``(A) nonresidential real property and qualified
residential rental property (as defined in section 142(d))
located in the Gulf Opportunity Zone, and
``(B) public utility property (as defined in section
168(i)(10)) located in the Gulf Opportunity Zone.
``(5) Special rules.--In applying this title to any
qualified Gulf Opportunity Zone Bond, the following
modifications shall apply:
``(A) Section 142(d)(1) (defining qualified residential
rental project) shall be applied--
``(i) by substituting `60 percent' for `50 percent' in
subparagraph (A) thereof, and
``(ii) by substituting `70 percent' for `60 percent' in
subparagraph (B) thereof.
``(B) Section 143 (relating to mortgage revenue bonds:
qualified mortgage bond and qualified veterans' mortgage
bond) shall be applied--
``(i) by treating only residences in the Gulf Opportunity
Zone as owner-occupied residences,
``(ii) by treating any residence in the Gulf Opportunity
Zone as a targeted area residence, and
``(iii) by substituting `$150,000' for `$15,000' in
subsection (k)(4) thereof.
``(C) Except as provided in section 143, repayments of
principal on financing provided by the issue of which such
bond is a part may not be used to provide financing.
``(D) Section 146 (relating to volume cap) shall not apply.
``(E) Section 147(d)(2) (relating to acquisition of
existing property not permitted) shall be applied by
substituting `50 percent' for `15 percent' each place it
appears.
``(F) Section 148(f)(4)(C) (relating to exception from
rebate for certain proceeds to be used to finance
construction expenditures) shall apply to the available
construction proceeds of bonds which are part of an issue
described in paragraph (2)(A)(i).
``(G) Section 57(a)(5) (relating to tax-exempt interest)
shall not apply.
``(6) Separate issue treatment of portions of an issue.--
This subsection shall not apply to the portion of an issue
which (if issued as a separate issue) would be treated as a
qualified bond or as a bond that is not a private activity
bond (determined without regard to paragraph (1)), if the
issuer elects to so treat such portion.
``(b) Advance Refundings of Certain Tax-Exempt Bonds.--
``(1) In general.--With respect to a bond described in
paragraph (3) which is not a qualified 501(c)(3) bond, one
additional advance refunding after the date of the enactment
of this section and before January 1, 2011, shall be allowed
under the applicable rules of section 149(d) if--
``(A) the Governor of the State designates the advance
refunding bond for purposes of this subsection, and
``(B) the requirements of paragraph (5) are met.
``(2) Certain private activity bonds.--With respect to a
bond described in paragraph (3) which is an exempt facility
bond described in paragraph (1) or (2) of section 142(a), one
advance refunding after the date of the enactment of this
section and before January 1, 2011, shall be allowed under
the applicable rules of section 149(d) (notwithstanding
paragraph (2) thereof) if the requirements of subparagraphs
(A) and (B) of paragraph (1) are met.
``(3) Bonds described.--A bond is described in this
paragraph if such bond was outstanding on August 28, 2005,
and is issued by the State of Alabama, Louisiana, or
Mississippi, or a political subdivision thereof.
``(4) Aggregate limit.--The maximum aggregate face amount
of bonds which may be designated under this subsection by the
Governor of a State shall not exceed--
``(A) $4,500,000,000 in the case of the State of Louisiana,
``(B) $2,250,000,000 in the case of the State of
Mississippi, and
``(C) $1,125,000,000 in the case of the State of Alabama.
``(5) Additional requirements.--The requirements of this
paragraph are met with respect to any advance refunding of a
bond described in paragraph (3) if--
``(A) no advance refundings of such bond would be allowed
under this title on or after August 28, 2005,
``(B) the advance refunding bond is the only other
outstanding bond with respect to the refunded bond, and
``(C) the requirements of section 148 are met with respect
to all bonds issued under this subsection.
``(c) Low-Income Housing Credit.--
``(1) Additional housing credit dollar amount.--
``(A) In general.--For purposes of section 42, in the case
of calendar years 2006, 2007, and 2008, the State housing
credit ceiling of each State, any portion of which is located
in the Gulf Opportunity Zone, shall be increased by the
lesser of--
``(i) the aggregate housing credit dollar amount allocated
by the State housing credit agency of such State to buildings
located in the Gulf Opportunity Zone for such calendar year,
or
``(ii) the Gulf Opportunity housing amount for such State
for such calendar year.
``(B) Gulf opportunity housing amount.--For purposes of
subparagraph (A), the term `Gulf Opportunity housing amount'
means, for any calendar year, the amount equal to the product
of $18.00 multiplied by the portion of the State population
which is in the Gulf Opportunity Zone (as determined on the
basis of the most recent census estimate of resident
population released by the Bureau of Census before August 28,
2005).
``(C) Allocations treated as made first from additional
allocation amount for purposes of determining carryover.--For
purposes of determining the unused State housing credit
ceiling under section 42(h)(3)(C) for any calendar year, any
increase in the State housing credit ceiling under
subparagraph (A) shall be treated as an amount described in
clause (ii) of such section.
``(2) Difficult development area.--
``(A) In general.--For purposes of section 42, in the case
of property placed in service during 2006, 2007, or 2008, the
Gulf Opportunity Zone--
``(i) shall be treated as a difficult development area
designated under subclause (I) of section 42(d)(5)(C)(iii),
and
``(ii) shall not be taken into account for purposes of
applying the limitation under subclause (II) of such section.
``(B) Application.--Subparagraph (A) shall apply only to--
``(i) housing credit dollar amounts allocated during the
period beginning on January 1, 2006, and ending on December
31, 2008, and
``(ii) buildings placed in service during such period to
the extent that paragraph (1) of section 42(h) does not apply
to any building by reason of paragraph (4) thereof, but only
with respect to bonds issued after December 31, 2005.
``(3) Special rule for applying income tests.--In the case
of property placed in service--
``(A) during 2006, 2007, or 2008,
``(B) in the Gulf Opportunity Zone, and
``(C) in a nonmetropolitan area (as defined in section
42(d)(5)(C)(iv)(IV)),
section 42 shall be applied by substituting `national
nonmetropolitan median gross income (determined under rules
similar to the rules of section 142(d)(2)(B))' for `area
median gross income' in subparagraphs (A) and (B) of section
42(g)(1).
``(4) Definitions.--Any term used in this subsection which
is also used in section 42 shall have the same meaning as
when used in such section.
``(d) Special Allowance for Certain Property Acquired on or
After August 28, 2005.--
``(1) Additional allowance.--In the case of any qualified
Gulf Opportunity Zone property--
``(A) the depreciation deduction provided by section 167(a)
for the taxable year in which such property is placed in
service shall include an allowance equal to 50 percent of the
adjusted basis of such property, and
``(B) the adjusted basis of the qualified Gulf Opportunity
Zone property shall be reduced by the amount of such
deduction before computing the amount otherwise allowable as
a depreciation deduction under this chapter for such taxable
year and any subsequent taxable year.
``(2) Qualified gulf opportunity zone property.-- For
purposes of this subsection--
``(A) In general.--The term `qualified Gulf Opportunity
Zone property' means property--
``(i)(I) which is described in section 168(k)(2)(A)(i), or
``(II) which is nonresidential real property or residential
rental property,
``(ii) substantially all of the use of which is in the Gulf
Opportunity Zone and is in the active conduct of a trade or
business by the taxpayer in such Zone,
``(iii) the original use of which in the Gulf Opportunity
Zone commences with the taxpayer on or after August 28, 2005,
[[Page H11154]]
``(iv) which is acquired by the taxpayer by purchase (as
defined in section 179(d)) on or after August 28, 2005, but
only if no written binding contract for the acquisition was
in effect before August 28, 2005, and
``(v) which is placed in service by the taxpayer on or
before December 31, 2007 (December 31, 2008, in the case of
nonresidential real property and residential rental
property).
``(B) Exceptions.--
``(i) Alternative depreciation property.--Such term shall
not include any property described in section
168(k)(2)(D)(i).
``(ii) Tax-exempt bond-financed property.--Such term shall
not include any property any portion of which is financed
with the proceeds of any obligation the interest on which is
exempt from tax under section 103.
``(iii) Qualified revitalization buildings.--Such term
shall not include any qualified revitalization building with
respect to which the taxpayer has elected the application of
paragraph (1) or (2) of section 1400I(a).
``(iv) Election out.--If a taxpayer makes an election under
this clause with respect to any class of property for any
taxable year, this subsection shall not apply to all property
in such class placed in service during such taxable year.
``(3) Special rules.--For purposes of this subsection,
rules similar to the rules of subparagraph (E) of section
168(k)(2) shall apply, except that such subparagraph shall be
applied--
``(A) by substituting `August 27, 2005' for `September 10,
2001' each place it appears therein,
``(B) by substituting `January 1, 2008' for `January 1,
2005' in clause (i) thereof, and
``(C) by substituting `qualified Gulf Opportunity Zone
property' for `qualified property' in clause (iv) thereof.
``(4) Allowance against alternative minimum tax.--For
purposes of this subsection, rules similar to the rules of
section 168(k)(2)(G) shall apply.
``(5) Recapture.--For purposes of this subsection, rules
similar to the rules under section 179(d)(10) shall apply
with respect to any qualified Gulf Opportunity Zone property
which ceases to be qualified Gulf Opportunity Zone property.
``(e) Increase in Expensing Under Section 179.--
``(1) In general.--For purposes of section 179--
``(A) the dollar amount in effect under section 179(b)(1)
for the taxable year shall be increased by the lesser of--
``(i) $100,000, or
``(ii) the cost of qualified section 179 Gulf Opportunity
Zone property placed in service during the taxable year, and
``(B) the the dollar amount in effect under section
179(b)(2) for the taxable year shall be increased by the
lesser of--
``(i) $600,000, or
``(ii) the cost of qualified section 179 Gulf Opportunity
Zone property placed in service during the taxable year.
``(2) Qualified section 179 gulf opportunity zone
property.--For purposes of this subsection, the term
`qualified section 179 Gulf Opportunity Zone property' means
section 179 property (as defined in section 179(d)) which is
qualified Gulf Opportunity Zone property (as defined in
subsection (d)(2)).
``(3) Coordination with empowerment zones and renewal
communities.--For purposes of sections 1397A and 1400J,
qualified section 179 Gulf Opportunity Zone property shall
not be treated as qualified zone property or qualified
renewal property, unless the taxpayer elects not to take such
qualified section 179 Gulf Opportunity Zone property into
account for purposes of this subsection.
``(4) Recapture.--For purposes of this subsection, rules
similar to the rules under section 179(d)(10) shall apply
with respect to any qualified section 179 Gulf Opportunity
Zone property which ceases to be qualified section 179 Gulf
Opportunity Zone property.
``(f) Expensing for Certain Demolition and Clean-Up
Costs.--
``(1) In general.--A taxpayer may elect to treat 50 percent
of any qualified Gulf Opportunity Zone clean-up cost as an
expense which is not chargeable to capital account. Any cost
so treated shall be allowed as a deduction for the taxable
year in which such cost is paid or incurred.
``(2) Qualified gulf opportunity zone clean-up cost.--For
purposes of this subsection, the term `qualified Gulf
Opportunity Zone clean-up cost' means any amount paid or
incurred during the period beginning on August 28, 2005, and
ending on December 31, 2007, for the removal of debris from,
or the demolition of structures on, real property which is
located in the Gulf Opportunity Zone and which is--
``(A) held by the taxpayer for use in a trade or business
or for the production of income, or
``(B) property described in section 1221(a)(1) in the hands
of the taxpayer.
For purposes of the preceding sentence, amounts paid or
incurred shall be taken into account only to the extent that
such amount would (but for paragraph (1)) be chargeable to
capital account.
``(g) Extension of Expensing for Environmental Remediation
Costs.--With respect to any qualified environmental
remediation expenditure (as defined in section 198(b)) paid
or incurred on or after August 28, 2005, in connection with a
qualified contaminated site located in the Gulf Opportunity
Zone, section 198 (relating to expensing of environmental
remediation costs) shall be applied--
``(1) in the case of expenditures paid or incurred on or
after August 28, 2005, and before January 1, 2008, by
substituting `December 31, 2007' for the date contained in
section 198(h), and
``(2) except as provided in section 198(d)(2), by treating
petroleum products (as defined in section 4612(a)(3)) as a
hazardous substance.
``(h) Increase in Rehabilitation Credit.--In the case of
qualified rehabilitation expenditures (as defined in section
47(c)) paid or incurred during the period beginning on August
28, 2005, and ending on December 31, 2008, with respect to
any qualified rehabilitated building or certified historic
structure (as defined in section 47(c)) located in the Gulf
Opportunity Zone, subsection (a) of section 47 (relating to
rehabilitation credit) shall be applied--
``(1) by substituting `13 percent' for `10 percent' in
paragraph (1) thereof, and
``(2) by substituting `26 percent' for `20 percent' in
paragraph (2) thereof.
``(i) Special Rules for Small Timber Producers.--
``(1) Increased expensing for qualified timber property.--
In the case of qualified timber property any portion of which
is located in the Gulf Opportunity Zone or in that portion of
the Rita GO Zone which is not part of the Gulf Opportunity
Zone, the limitation under subparagraph (B) of section
194(b)(1) shall be increased by the lesser of--
``(A) the limitation which would (but for this subsection)
apply under such subparagraph, or
``(B) the amount of reforestation expenditures (as defined
in section 194(c)(3)) paid or incurred by the taxpayer with
respect to such qualified timber property during the
specified portion of the taxable year.
``(2) 5 year nol carryback of certain timber losses.--For
purposes of determining farming loss under section 172(i),
income and deductions which are allocable to the specified
portion of the taxable year and which are attributable to
qualified timber property any portion of which is located in
the Gulf Opportunity Zone or in that portion of the Rita GO
Zone which is not part of the Gulf Opportunity Zone shall be
treated as attributable to farming businesses.
``(3) Rules not applicable to large timber producers.--
``(A) Expensing.--Paragraph (1) shall not apply to any
taxpayer if such taxpayer holds more than 500 acres of
qualified timber property at any time during the taxable
year.
``(B) NOL carryback.--Paragraph (2) shall not apply with
respect to any qualified timber property unless--
``(i) such property was held by the taxpayer--
``(I) on August 28, 2005, in the case of qualified timber
property any portion of which is located in the Gulf
Opportunity Zone, or
``(II) on September 23, 2005, in the case of qualified
timber property (other than property described in subclause
(I)) any portion of which is located in that portion of the
Rita GO Zone which is not part of the Gulf Opportunity Zone,
and
``(ii) such taxpayer held not more than 500 acres of
qualified timber property on such date.
``(C) Aggregation rule.--For purposes of subparagraphs (A)
and (B), related persons shall be treated as one taxpayer.
For purposes of the preceding sentence, the following shall
be treated as related persons--
``(i) 2 or more persons if the relationship between such
persons would result in a disallowance of losses under
section 267 or 707(b), and
``(ii) 2 or more persons which are members of the same
controlled group (within the meaning of section 194(b)(2)(A))
of corporations.
For purposes of clause (i), section 267 shall be applied
without regard to subsection (b)(1) thereof.
``(4) Definitions.--For purposes of this subsection--
``(A) Specified portion.--The term `specified portion'
means--
``(i) in the case of qualified timber property any portion
of which is located in the Gulf Opportunity Zone, that
portion of the taxable year which is on or after August 28,
2005, and before January 1, 2007, and
``(ii) in the case of qualified timber property (other than
property described in clause (i)) any portion of which is
located in the Rita GO Zone, that portion of the taxable year
which is on or after September 23, 2005, and before January
1, 2007.
``(B) Qualified timber property.--The term `qualified
timber property' has the meaning given such term in section
194(c)(1).
``(j) Special Rule for Gulf Opportunity Zone Public Utility
Casualty Losses.--
``(1) In general.--The amount described in section
172(f)(1)(A) for any taxable year shall be increased by the
Gulf Opportunity Zone public utility casualty loss for such
taxable year.
``(2) Gulf opportunity zone public utility casualty loss.--
For purposes of this subsection, the term `Gulf Opportunity
Zone public utility casualty loss' means any casualty loss of
public utility property (as defined in section 168(i)(10))
located in the Gulf Opportunity Zone if--
``(A) such loss is allowed as a deduction under section 165
for the taxable year,
``(B) such loss is by reason of Hurricane Katrina, and
``(C) the taxpayer elects the application of this
subsection with respect to such loss.
[[Page H11155]]
``(3) Reduction for gains from involuntary conversion.--The
amount of Gulf Opportunity Zone public utility casualty loss
which would (but for this paragraph) be taken into account
under paragraph (1) for any taxable year shall be reduced by
the amount of any gain recognized by the taxpayer for such
year from the involuntary conversion by reason of Hurricane
Katrina of public utility property (as so defined) located in
the Gulf Opportunity Zone.
``(4) Coordination with general disaster loss rules.--
Section 165(i) shall not apply to any Gulf Opportunity Zone
public utility casualty loss to the extent such loss is taken
into account under paragraph (1).
``(5) Election.--Any election under paragraph (2)(C) shall
be made in such manner as may be prescribed by the Secretary
and shall be made by the due date (including extensions of
time) for filing the taxpayer's return for the taxable year
of the loss. Such election, once made for any taxable year,
shall be irrevocable for such taxable year.
``(k) Special NOL Carryback of Cost Recovery Deductions for
Qualified GO Zone Property.--
``(1) In general.--For purposes of section 172, the GO Zone
cost recovery loss for any taxable year ending on or after
August 28, 2005, and before January 1, 2009, shall be a net
operating loss carryback to each of the 5 taxable years
preceding the taxable year of the loss.
``(2) GO zone cost recovery loss.--For purposes of this
subsection, the term `GO Zone cost recovery loss' means, with
respect to any taxable year, the lesser of--
``(A) the aggregate amount of the deductions allowed under
sections 167 and 168 with respect to qualified Gulf
Opportunity Zone property (as defined in subsection (d)(2),
but without regard to subparagraph (B)(iv) thereof) which is
placed in service during such taxable year, or
``(B) the excess of--
``(i) the net operating loss for such taxable year, over
``(ii) the specified liability loss for such taxable year
to which a 10-year carryback applies under section
172(b)(1)(C).
``(3) Coordination with ordering rule.--For purposes of
applying section 172(b)(2), a GO Zone cost recovery loss to
which paragraph (1) applies shall be treated in a manner
similar to the manner in which a specified liability loss is
treated.
``(4) Election out.--A rule similar to the rule of section
172(j) shall apply for purposes of this subsection.
``(l) Credit to Holders of Gulf Tax Credit Bonds.--
``(1) Allowance of credit.--If a taxpayer holds a Gulf tax
credit bond on one or more credit allowance dates of the bond
occurring during any taxable year, there shall be allowed as
a credit against the tax imposed by this chapter for the
taxable year an amount equal to the sum of the credits
determined under paragraph (2) with respect to such dates.
``(2) Amount of credit.--
``(A) In general.--The amount of the credit determined
under this paragraph with respect to any credit allowance
date for a Gulf tax credit bond is 25 percent of the annual
credit determined with respect to such bond.
``(B) Annual credit.--The annual credit determined with
respect to any Gulf tax credit bond is the product of--
``(i) the credit rate determined by the Secretary under
subparagraph (C) for the day on which such bond was sold,
multiplied by
``(ii) the outstanding face amount of the bond.
``(C) Determination.--For purposes of subparagraph (B),
with respect to any Gulf tax credit bond, the Secretary shall
determine daily or cause to be determined daily a credit rate
which shall apply to the first day on which there is a
binding, written contract for the sale or exchange of the
bond. The credit rate for any day is the credit rate which
the Secretary or the Secretary's designee estimates will
permit the issuance of Gulf tax credit bonds with a specified
maturity or redemption date without discount and without
interest cost to the issuer.
``(D) Credit allowance date.--For purposes of this
subsection, the term `credit allowance date' means March 15,
June 15, September 15, and December 15. Such term also
includes the last day on which the bond is outstanding.
``(E) 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 paragraph 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 or matures.
``(3) Limitation based on amount of tax.--The credit
allowed under paragraph (1) 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 part IV of
subchapter A (other than subpart C and this subsection).
``(4) Gulf tax credit bond.--For purposes of this
subsection--
``(A) In general.--The term `Gulf tax credit bond' means
any bond issued as part of an issue if--
``(i) the bond is issued by the State of Alabama,
Louisiana, or Mississippi,
``(ii) 95 percent or more of the proceeds of such issue are
to be used to--
``(I) pay principal, interest, or premiums on qualified
bonds issued by such State or any political subdivision of
such State, or
``(II) make a loan to any political subdivision of such
State to pay principal, interest, or premiums on qualified
bonds issued by such political subdivision,
``(iii) the Governor of such State designates such bond for
purposes of this subsection,
``(iv) the bond is a general obligation of such State and
is in registered form (within the meaning of section 149(a)),
``(v) the maturity of such bond does not exceed 2 years,
and
``(vi) the bond is issued after December 31, 2005, and
before January 1, 2007.
``(B) State matching requirement.--A bond shall not be
treated as a Gulf tax credit bond unless--
``(i) the issuer of such bond pledges as of the date of the
issuance of the issue an amount equal to the face amount of
such bond to be used for payments described in subclause (I)
of subparagraph (A)(ii), or loans described in subclause (II)
of such subparagraph, as the case may be, with respect to the
issue of which such bond is a part, and
``(ii) any such payment or loan is made in equal amounts
from the proceeds of such issue and from the amount pledged
under clause (i).
The requirement of clause (ii) shall be treated as met with
respect to any such payment or loan made during the 1-year
period beginning on the date of the issuance (or any
successor 1-year period) if such requirement is met when
applied with respect to the aggregate amount of such payments
and loans made during such period.
``(C) Aggregate limit on bond designations.--The maximum
aggregate face amount of bonds which may be designated under
this subsection by the Governor of a State shall not exceed--
``(i) $200,000,000 in the case of the State of Louisiana,
``(ii) $100,000,000 in the case of the State of
Mississippi, and
``(iii) $50,000,000 in the case of the State of Alabama.
``(D) Special rules relating to arbitrage.--A bond which is
part of an issue shall not be treated as a Gulf tax credit
bond unless, with respect to the issue of which the bond is a
part, the issuer satisfies the arbitrage requirements of
section 148 with respect to proceeds of the issue and any
loans made with such proceeds.
``(5) Qualified bond.--For purposes of this subsection--
``(A) In general.--The term `qualified bond' means any
obligation of a State or political subdivision thereof which
was outstanding on August 28, 2005.
``(B) Exception for private activity bonds.--Such term
shall not include any private activity bond.
``(C) Exception for advance refundings.--Such term shall
not include any bond with respect to which there is any
outstanding refunded or refunding bond during the period in
which a Gulf tax credit bond is outstanding with respect to
such bond.
``(6) Credit included in gross income.--Gross income
includes the amount of the credit allowed to the taxpayer
under this subsection (determined without regard to paragraph
(3)) and the amount so included shall be treated as interest
income.
``(7) Other definitions and special rules.--For purposes of
this subsection--
``(A) Bond.--The term `bond' includes any obligation.
``(B) partnership; s corporation; and other pass-thru
entities.--
``(i) In general.--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 paragraph (1).
``(ii) No basis adjustment.--In the case of a bond held by
a partnership or an S corporation, rules similar to the rules
under section 1397E(i) shall apply.
``(C) Bonds held by regulated investment companies.--If any
Gulf tax credit bond is held by a regulated investment
company, the credit determined under paragraph (1) shall be
allowed to shareholders of such company under procedures
prescribed by the Secretary.
``(D) Reporting.--Issuers of Gulf tax credit bonds shall
submit reports similar to the reports required under section
149(e).
``(E) Credit treated as nonrefundable bondholder credit.--
For purposes of this title, the credit allowed by this
subsection shall be treated as a credit allowable under
subpart H of part IV of subchapter A of this chapter.
``(m) Tax Benefits not Available With Respect to Facilities
for Gambling, Etc.--
``(1) Tax-exempt bond financing.--Subsection (a) shall not
apply to any bond issued as part of an issue if any portion
of the proceeds of such issue is to be used to provide any
property described in section 144(c)(6)(B).
``(2) Advance refunding bonds.--Subsection (b) shall not
apply to any advance refunding of a bond which is issued as
part of an issue if any portion of the proceeds of such issue
(or any prior issue) was (or is to be) used to provide any
property described in section 144(c)(6)(B).
``(3) Low-income housing credit.--For purposes of
subsection (c), property shall not be
[[Page H11156]]
treated as located or placed in service in the Gulf
Opportunity Zone if such property is described in section
144(c)(6)(B).
``(4) Special allowance for certain property; section 179
expensing; carryback of cost recovery deductions.--For
purposes of subsections (d), (e), and (k), the term
`qualified Gulf Opportunity Zone property' shall not include
any property described in section 144(c)(6)(B).
``(5) Demolition and clean-up costs; remediation;
rehabilitation expenses.--Subsections (f), (g), and (h) shall
not apply with respect to any amount paid or incurred with
respect to any property described in section 144(c)(6)(B).
``(6) Timber producers.--For purposes of subsection (i),
qualified timber property shall not include any property
described in section 144(c)(6)(B).
``(7) Public utility casualty losses.--For purposes of
subsection (j), public utility property shall not include any
property described in section 144(c)(6)(B).
``(8) Gulf tax credit bonds.--Subsection (l) shall not
apply to any bond issued as part of an issue if any portion
of the proceeds of such issue is to be used to provide any
property described in section 144(c)(6)(B).''.
(b) Conforming Amendments.--
(1) Paragraph (2) of section 54(c) is amended by inserting
``, section 1400N(l),'' after ``subpart C''.
(2) Subparagraph (A) of section 6049(d)(8) is amended--
(A) by inserting ``or 1400N(l)(6)'' after ``section
54(g)'', and
(B) by inserting ``or 1400N(l)(2)(D), as the case may be''
after ``section 54(b)(4)''.
(3) So much of subchapter Y of chapter 1 as precedes
section 1400L is amended to read as follows:
``Subchapter Y--Short-term Regional Benefits
``Part I--Tax benefits for New York Liberty Zone
``Part II--Tax benefits for Gulf Opportunity Zone
``PART I--TAX BENEFITS FOR NEW YORK LIBERTY ZONE
``Sec. 1400L. Tax benefits for New York Liberty Zone.''.
(4) The item relating to subchapter Y in the table of
subchapters for chapter 1 is amended to read as follows:
``Subchapter Y--Short-term regional benefits''.
(c) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to taxable years
ending on or after August 28, 2005.
(2) Carrybacks.--Subsections (i)(2), (j), and (k) of
section 1400N of the Internal Revenue Code of 1986 (as added
by this section) shall apply to losses arising in such
taxable years.
SEC. 102. FEDERAL GUARANTEE OF CERTAIN STATE BONDS.
(a) State Bonds Described.--
(1) In general.--This section shall apply to a bond issued
as part of an issue if--
(A) the issue of which such bond is part is an issue of the
State of Alabama, Louisiana, or Mississippi,
(B) the bond is a general obligation of the issuing State
and is in registered form,
(C) the proceeds of the bond are distributed to one or more
political subdivisions of the issuing State,
(D) the maturity of such bond does not exceed 5 years,
(E) the bond is issued after the date of the enactment of
this Act and before January 1, 2008, and
(F) the bond is designated by the Secretary of the Treasury
for purposes of this section.
(2) Facilities for gambling, etc.--The Secretary of the
Treasury may not designate any bond for purposes of this
section if such bond is issued as part of an issue any
portion of the proceeds of which is to be used to provide any
property described in section 144(c)(6)(B).
(b) Application.--
(1) In general.--The Secretary of the Treasury may only
designate a bond for purposes of this section pursuant to an
application submitted to the Secretary by the State which
demonstrates the need for such designation on the basis of
the criteria specified in paragraph (2).
(2) Criteria.--For purposes of paragraph (1), the criteria
specified in this paragraph are--
(A) the loss of revenue base of one or more political
subdivisions of the State by reason of Hurricane Katrina,
(B) the need for resources to fund infrastructure within,
or operating expenses of, any such political subdivision,
(C) the lack of access of such political subdivision to
capital, and
(D) any other criteria as may be determined by the
Secretary.
(3) Guidance for submission and consideration of
applications.--The Secretary of the Treasury shall prescribe
regulations or other guidance which provide for the time and
manner for the submission and consideration of applications
under this subsection.
(c) Federal Guarantee.--A bond described in subsection (a)
is guaranteed by the United States in an amount equal to 50
percent of the outstanding principal with respect to such
bond.
(d) Aggregate Limit on Bond Designations.--The maximum
aggregate face amount of bonds which may be issued under this
section shall not exceed $3,000,000,000.
TITLE II--TAX BENEFITS RELATED TO HURRICANES RITA AND WILMA
SEC. 201. EXTENSION OF CERTAIN EMERGENCY TAX RELIEF FOR
HURRICANE KATRINA TO HURRICANES RITA AND WILMA.
(a) In General.--Part II of subchapter Y of chapter 1 (as
added by this Act) is amended by adding at the end the
following new sections:
``SEC. 1400O. SPECIAL RULES FOR USE OF RETIREMENT FUNDS.
``(a) Tax-Favored Withdrawals From Retirement Plans.--
``(1) In general.--Section 72(t) shall not apply to any
qualified hurricane distribution.
``(2) Aggregate dollar limitation.--
``(A) In general.--For purposes of this subsection, the
aggregate amount of distributions received by an individual
which may be treated as qualified hurricane distributions for
any taxable year shall not exceed the excess (if any) of--
``(i) $100,000, over
``(ii) the aggregate amounts treated as qualified hurricane
distributions received by such individual for all prior
taxable years.
``(B) Treatment of plan distributions.--If a distribution
to an individual would (without regard to subparagraph (A))
be a qualified hurricane distribution, a plan shall not be
treated as violating any requirement of this title merely
because the plan treats such distribution as a qualified
hurricane distribution, unless the aggregate amount of such
distributions from all plans maintained by the employer (and
any member of any controlled group which includes the
employer) to such individual exceeds $100,000.
``(C) Controlled group.--For purposes of subparagraph (B),
the term `controlled group' means any group treated as a
single employer under subsection (b), (c), (m), or (o) of
section 414.
``(3) Amount distributed may be repaid.--
``(A) In general.--Any individual who receives a qualified
hurricane distribution may, at any time during the 3-year
period beginning on the day after the date on which such
distribution was received, make one or more contributions in
an aggregate amount not to exceed the amount of such
distribution to an eligible retirement plan of which such
individual is a beneficiary and to which a rollover
contribution of such distribution could be made under section
402(c), 403(a)(4), 403(b)(8), 408(d)(3), or 457(e)(16), as
the case may be.
``(B) Treatment of repayments of distributions from
eligible retirement plans other than iras.--For purposes of
this title, if a contribution is made pursuant to
subparagraph (A) with respect to a qualified hurricane
distribution from an eligible retirement plan other than an
individual retirement plan, then the taxpayer shall, to the
extent of the amount of the contribution, be treated as
having received the qualified hurricane distribution in an
eligible rollover distribution (as defined in section
402(c)(4)) and as having transferred the amount to the
eligible retirement plan in a direct trustee to trustee
transfer within 60 days of the distribution.
``(C) Treatment of repayments for distributions from
iras.--For purposes of this title, if a contribution is made
pursuant to subparagraph (A) with respect to a qualified
hurricane distribution from an individual retirement plan (as
defined by section 7701(a)(37)), then, to the extent of the
amount of the contribution, the qualified hurricane
distribution shall be treated as a distribution described in
section 408(d)(3) and as having been transferred to the
eligible retirement plan in a direct trustee to trustee
transfer within 60 days of the distribution.
``(4) Definitions.--For purposes of this subsection--
``(A) Qualified hurricane distribution.--Except as provided
in paragraph (2), the term `qualified hurricane distribution'
means--
``(i) any distribution from an eligible retirement plan
made on or after August 25, 2005, and before January 1, 2007,
to an individual whose principal place of abode on August 28,
2005, is located in the Hurricane Katrina disaster area and
who has sustained an economic loss by reason of Hurricane
Katrina,
``(ii) any distribution (which is not described in clause
(i)) from an eligible retirement plan made on or after
September 23, 2005, and before January 1, 2007, to an
individual whose principal place of abode on September 23,
2005, is located in the Hurricane Rita disaster area and who
has sustained an economic loss by reason of Hurricane Rita,
and
``(iii) any distribution (which is not described in clause
(i) or (ii)) from an eligible retirement plan made on or
after October 23, 2005, and before January 1, 2007, to an
individual whose principal place of abode on October 23,
2005, is located in the Hurricane Wilma disaster area and who
has sustained an economic loss by reason of Hurricane Wilma.
``(B) Eligible retirement plan.--The term `eligible
retirement plan' shall have the meaning given such term by
section 402(c)(8)(B).
``(5) Income inclusion spread over 3-year period.--
``(A) In general.--In the case of any qualified hurricane
distribution, unless the taxpayer elects not to have this
paragraph apply for any taxable year, any amount required to
be included in gross income for such taxable year shall be so
included ratably over the 3-taxable year period beginning
with such taxable year.
[[Page H11157]]
``(B) Special rule.--For purposes of subparagraph (A),
rules similar to the rules of subparagraph (E) of section
408A(d)(3) shall apply.
``(6) Special rules.--
``(A) Exemption of distributions from trustee to trustee
transfer and withholding rules.--For purposes of sections
401(a)(31), 402(f), and 3405, qualified hurricane
distributions shall not be treated as eligible rollover
distributions.
``(B) Qualified hurricane distributions treated as meeting
plan distribution requirements.--For purposes this title, a
qualified hurricane distribution shall be treated as meeting
the requirements of sections 401(k)(2)(B)(i),
403(b)(7)(A)(ii), 403(b)(11), and 457(d)(1)(A).
``(b) Recontributions of Withdrawals for Home Purchases.--
``(1) Recontributions.--
``(A) In general.--Any individual who received a qualified
distribution may, during the applicable period, make one or
more contributions in an aggregate amount not to exceed the
amount of such qualified distribution to an eligible
retirement plan (as defined in section 402(c)(8)(B)) of which
such individual is a beneficiary and to which a rollover
contribution of such distribution could be made under section
402(c), 403(a)(4), 403(b)(8), or 408(d)(3), as the case may
be.
``(B) Treatment of repayments.--Rules similar to the rules
of subparagraphs (B) and (C) of subsection (a)(3) shall apply
for purposes of this subsection.
``(2) Qualified distribution.--For purposes of this
subsection--
``(A) In general.--The term `qualified distribution' means
any qualified Katrina distribution, any qualified Rita
distribution, and any qualified Wilma distribution.
``(B) Qualified katrina distribution.--The term `qualified
Katrina distribution' means any distribution--
``(i) described in section 401(k)(2)(B)(i)(IV),
403(b)(7)(A)(ii) (but only to the extent such distribution
relates to financial hardship), 403(b)(11)(B), or
72(t)(2)(F),
``(ii) received after February 28, 2005, and before August
29, 2005, and
``(iii) which was to be used to purchase or construct a
principal residence in the Hurricane Katrina disaster area,
but which was not so purchased or constructed on account of
Hurricane Katrina.
``(C) Qualified rita distribution.--The term `qualified
Rita distribution' means any distribution (other than a
qualified Katrina distribution)--
``(i) described in section 401(k)(2)(B)(i)(IV),
403(b)(7)(A)(ii) (but only to the extent such distribution
relates to financial hardship), 403(b)(11)(B), or
72(t)(2)(F),
``(ii) received after February 28, 2005, and before
September 24, 2005, and
``(iii) which was to be used to purchase or construct a
principal residence in the Hurricane Rita disaster area, but
which was not so purchased or constructed on account of
Hurricane Rita.
``(D) Qualified wilma distribution.--The term `qualified
Wilma distribution' means any distribution (other than a
qualified Katrina distribution or a qualified Rita
distribution)--
``(i) described in section 401(k)(2)(B)(i)(IV),
403(b)(7)(A)(ii) (but only to the extent such distribution
relates to financial hardship), 403(b)(11)(B), or
72(t)(2)(F),
``(ii) received after February 28, 2005, and before October
24, 2005, and
``(iii) which was to be used to purchase or construct a
principal residence in the Hurricane Wilma disaster area, but
which was not so purchased or constructed on account of
Hurricane Wilma.
``(3) Applicable period.--For purposes of this subsection,
the term `applicable period' means--
``(A) with respect to any qualified Katrina distribution,
the period beginning on August 25, 2005, and ending on
February 28, 2006,
``(B) with respect to any qualified Rita distribution, the
period beginning on September 23, 2005, and ending on
February 28, 2006, and
``(C) with respect to any qualified Wilma distribution, the
period beginning on October 23, 2005, and ending on February
28, 2006.
``(c) Loans From Qualified Plans.--
``(1) Increase in limit on loans not treated as
distributions.--In the case of any loan from a qualified
employer plan (as defined under section 72(p)(4)) to a
qualified individual made during the applicable period--
``(A) clause (i) of section 72(p)(2)(A) shall be applied by
substituting `$100,000' for `$50,000', and
``(B) clause (ii) of such section shall be applied by
substituting `the present value of the nonforfeitable accrued
benefit of the employee under the plan' for `one-half of the
present value of the nonforfeitable accrued benefit of the
employee under the plan'.
``(2) Delay of repayment.--In the case of a qualified
individual with an outstanding loan on or after the qualified
beginning date from a qualified employer plan (as defined in
section 72(p)(4))--
``(A) if the due date pursuant to subparagraph (B) or (C)
of section 72(p)(2) for any repayment with respect to such
loan occurs during the period beginning on the qualified
beginning date and ending on December 31, 2006, such due date
shall be delayed for 1 year,
``(B) any subsequent repayments with respect to any such
loan shall be appropriately adjusted to reflect the delay in
the due date under paragraph (1) and any interest accruing
during such delay, and
``(C) in determining the 5-year period and the term of a
loan under subparagraph (B) or (C) of section 72(p)(2), the
period described in subparagraph (A) shall be disregarded.
``(3) Qualified individual.--For purposes of this
subsection--
``(A) In general.--The term `qualified individual' means
any qualified Hurricane Katrina individual, any qualified
Hurricane Rita individual, and any qualified Hurricane Wilma
individual.
``(B) Qualified hurricane katrina individual.--The term
`qualified Hurricane Katrina individual' means an individual
whose principal place of abode on August 28, 2005, is located
in the Hurricane Katrina disaster area and who has sustained
an economic loss by reason of Hurricane Katrina.
``(C) Qualified hurricane rita individual.--The term
`qualified Hurricane Rita individual' means an individual
(other than a qualified Hurricane Katrina individual) whose
principal place of abode on September 23, 2005, is located in
the Hurricane Rita disaster area and who has sustained an
economic loss by reason of Hurricane Rita.
``(D) Qualified hurricane wilma individual.--The term
`qualified Hurricane Wilma individual' means an individual
(other than a qualified Hurricane Katrina individual or a
qualified Hurricane Rita individual) whose principal place of
abode on October 23, 2005, is located in the Hurricane Wilma
disaster area and who has sustained an economic loss by
reason of Hurricane Wilma.
``(4) Applicable period; qualified beginning date.--For
purposes of this subsection--
``(A) Hurricane katrina.--In the case of any qualified
Hurricane Katrina individual--
``(i) the applicable period is the period beginning on
September 24, 2005, and ending on December 31, 2006, and
``(ii) the qualified beginning date is August 25, 2005.
``(B) Hurricane rita.--In the case of any qualified
Hurricane Rita individual--
``(i) the applicable period is the period beginning on the
date of the enactment of this subsection and ending on
December 31, 2006, and
``(ii) the qualified beginning date is September 23, 2005.
``(C) Hurricane wilma.--In the case of any qualified
Hurricane Wilma individual--
``(i) the applicable period is the period beginning on the
date of the enactment of this subparagraph and ending on
December 31, 2006, and
``(ii) the qualified beginning date is October 23, 2005.
``(d) Provisions Relating to Plan Amendments.--
``(1) In general.--If this subsection applies to any
amendment to any plan or annuity contract, such plan or
contract shall be treated as being operated in accordance
with the terms of the plan during the period described in
paragraph (2)(B)(i).
``(2) Amendments to which subsection applies.--
``(A) In general.--This subsection shall apply to any
amendment to any plan or annuity contract which is made--
``(i) pursuant to any provision of this section, or
pursuant to any regulation issued by the Secretary or the
Secretary of Labor under any provision of this section, and
``(ii) on or before the last day of the first plan year
beginning on or after January 1, 2007, or such later date as
the Secretary may prescribe.
In the case of a governmental plan (as defined in section
414(d)), clause (ii) shall be applied by substituting the
date which is 2 years after the date otherwise applied under
clause (ii).
``(B) Conditions.--This subsection shall not apply to any
amendment unless--
``(i) during the period--
``(I) beginning on the date that this section or the
regulation described in subparagraph (A)(i) takes effect (or
in the case of a plan or contract amendment not required by
this section or such regulation, the effective date specified
by the plan), and
``(II) ending on the date described in subparagraph (A)(ii)
(or, if earlier, the date the plan or contract amendment is
adopted),
the plan or contract is operated as if such plan or contract
amendment were in effect; and
``(ii) such plan or contract amendment applies
retroactively for such period.
``SEC. 1400P. EMPLOYMENT RELIEF.
``(a) Employee Retention Credit for Employers Affected by
Hurricane Katrina.--
``(1) In general.--For purposes of section 38, in the case
of an eligible employer, the Hurricane Katrina employee
retention credit for any taxable year is an amount equal to
40 percent of the qualified wages with respect to each
eligible employee of such employer for such taxable year. For
purposes of the preceding sentence, the amount of qualified
wages which may be taken into account with respect to any
individual shall not exceed $6,000.
``(2) Definitions.--For purposes of this subsection--
``(A) Eligible employer.--The term `eligible employer'
means any employer--
``(i) which conducted an active trade or business on August
28, 2005, in the GO Zone, and
``(ii) with respect to whom the trade or business described
in clause (i) is inoperable on any day after August 28, 2005,
and before January 1, 2006, as a result of damage sustained
by reason of Hurricane Katrina.
[[Page H11158]]
``(B) Eligible employee.--The term `eligible employee'
means with respect to an eligible employer an employee whose
principal place of employment on August 28, 2005, with such
eligible employer was in the GO Zone.
``(C) Qualified wages.--The term `qualified wages' means
wages (as defined in section 51(c)(1), but without regard to
section 3306(b)(2)(B)) paid or incurred by an eligible
employer with respect to an eligible employee on any day
after August 28, 2005, and before January 1, 2006, which
occurs during the period--
``(i) beginning on the date on which the trade or business
described in subparagraph (A) first became inoperable at the
principal place of employment of the employee immediately
before Hurricane Katrina, and
``(ii) ending on the date on which such trade or business
has resumed significant operations at such principal place of
employment.
Such term shall include wages paid without regard to whether
the employee performs no services, performs services at a
different place of employment than such principal place of
employment, or performs services at such principal place of
employment before significant operations have resumed.
``(3) Credit not allowed for large businesses.--The term
`eligible employer' shall not include any trade or business
for any taxable year if such trade or business employed an
average of more than 200 employees on business days during
the taxable year.
``(4) Certain rules to apply.--For purposes of this
subsection, rules similar to the rules of sections 51(i)(1),
52, and 280C(a) shall apply.
``(5) Employee not taken into account more than once.--An
employee shall not be treated as an eligible employee for
purposes of this subsection for any period with respect to
any employer if such employer is allowed a credit under
section 51 with respect to such employee for such period.
``(b) Employee Retention Credit for Employers Affected by
Hurricane Rita.--
``(1) In general.--For purposes of section 38, in the case
of an eligible employer, the Hurricane Rita employee
retention credit for any taxable year is an amount equal to
40 percent of the qualified wages with respect to each
eligible employee of such employer for such taxable year. For
purposes of the preceding sentence, the amount of qualified
wages which may be taken into account with respect to any
individual shall not exceed $6,000.
``(2) Definitions.--For purposes of this subsection--
``(A) Eligible employer.--The term `eligible employer'
means any employer--
``(i) which conducted an active trade or business on
September 23, 2005, in the Rita GO Zone, and
``(ii) with respect to whom the trade or business described
in clause (i) is inoperable on any day after September 23,
2005, and before January 1, 2006, as a result of damage
sustained by reason of Hurricane Rita.
``(B) Eligible employee.--The term `eligible employee'
means with respect to an eligible employer an employee whose
principal place of employment on September 23, 2005, with
such eligible employer was in the Rita GO Zone.
``(C) Qualified wages.--The term `qualified wages' means
wages (as defined in section 51(c)(1), but without regard to
section 3306(b)(2)(B)) paid or incurred by an eligible
employer with respect to an eligible employee on any day
after September 23, 2005, and before January 1, 2006, which
occurs during the period--
``(i) beginning on the date on which the trade or business
described in subparagraph (A) first became inoperable at the
principal place of employment of the employee immediately
before Hurricane Rita, and
``(ii) ending on the date on which such trade or business
has resumed significant operations at such principal place of
employment.
Such term shall include wages paid without regard to whether
the employee performs no services, performs services at a
different place of employment than such principal place of
employment, or performs services at such principal place of
employment before significant operations have resumed.
``(3) Credit not allowed for large businesses.--The term
`eligible employer' shall not include any trade or business
for any taxable year if such trade or business employed an
average of more than 200 employees on business days during
the taxable year.
``(4) Certain rules to apply.--For purposes of this
subsection, rules similar to the rules of sections 51(i)(1),
52, and 280C(a) shall apply.
``(5) Employee not taken into account more than once.--An
employee shall not be treated as an eligible employee for
purposes of this subsection for any period with respect to
any employer if such employer is allowed a credit under
subsection (a) or section 51 with respect to such employee
for such period.
``(c) Employee Retention Credit for Employers Affected by
Hurricane Wilma.--
``(1) In general.--For purposes of section 38, in the case
of an eligible employer, the Hurricane Wilma employee
retention credit for any taxable year is an amount equal to
40 percent of the qualified wages with respect to each
eligible employee of such employer for such taxable year. For
purposes of the preceding sentence, the amount of qualified
wages which may be taken into account with respect to any
individual shall not exceed $6,000.
``(2) Definitions.--For purposes of this subsection--
``(A) Eligible employer.--The term `eligible employer'
means any employer--
``(i) which conducted an active trade or business on
October 23, 2005, in the Wilma GO Zone, and
``(ii) with respect to whom the trade or business described
in clause (i) is inoperable on any day after October 23,
2005, and before January 1, 2006, as a result of damage
sustained by reason of Hurricane Wilma.
``(B) Eligible employee.--The term `eligible employee'
means with respect to an eligible employer an employee whose
principal place of employment on October 23, 2005, with such
eligible employer was in the Wilma GO Zone.
``(C) Qualified wages.--The term `qualified wages' means
wages (as defined in section 51(c)(1), but without regard to
section 3306(b)(2)(B)) paid or incurred by an eligible
employer with respect to an eligible employee on any day
after October 23, 2005, and before January 1, 2006, which
occurs during the period--
``(i) beginning on the date on which the trade or business
described in subparagraph (A) first became inoperable at the
principal place of employment of the employee immediately
before Hurricane Wilma, and
``(ii) ending on the date on which such trade or business
has resumed significant operations at such principal place of
employment.
Such term shall include wages paid without regard to whether
the employee performs no services, performs services at a
different place of employment than such principal place of
employment, or performs services at such principal place of
employment before significant operations have resumed.
``(3) Credit not allowed for large businesses.--The term
`eligible employer' shall not include any trade or business
for any taxable year if such trade or business employed an
average of more than 200 employees on business days during
the taxable year.
``(4) Certain rules to apply.--For purposes of this
subsection, rules similar to the rules of sections 51(i)(1),
52, and 280C(a) shall apply.
``(5) Employee not taken into account more than once.--An
employee shall not be treated as an eligible employee for
purposes of this subsection for any period with respect to
any employer if such employer is allowed a credit under
subsection (a) or (b) or section 51 with respect to such
employee for such period.
``SEC. 1400Q. ADDITIONAL TAX RELIEF PROVISIONS.
``(a) Temporary Suspension of Limitations on Charitable
Contributions.--
``(1) In general.--Except as otherwise provided in
paragraph (2), section 170(b) shall not apply to qualified
contributions and such contributions shall not be taken into
account for purposes of applying subsections (b) and (d) of
section 170 to other contributions.
``(2) Treatment of excess contributions.--For purposes of
section 170--
``(A) Individuals.--In the case of an individual--
``(i) Limitation.--Any qualified contribution shall be
allowed only to the extent that the aggregate of such
contributions does not exceed the excess of the taxpayer's
contribution base (as defined in subparagraph (F) of section
170(b)(1)) over the amount of all other charitable
contributions allowed under section 170(b)(1).
``(ii) Carryover.--If the aggregate amount of qualified
contributions made in the contribution year (within the
meaning of section 170(d)(1)) exceeds the limitation of
clause (i), such excess shall be added to the excess
described in the portion of subparagraph (A) of such section
which precedes clause (i) thereof for purposes of applying
such section.
``(B) Corporations.--In the case of a corporation--
``(i) Limitation.--Any qualified contribution shall be
allowed only to the extent that the aggregate of such
contributions does not exceed the excess of the taxpayer's
taxable income (as determined under paragraph (2) of section
170(b)) over the amount of all other charitable contributions
allowed under such paragraph.
``(ii) Carryover.--Rules similar to the rules of
subparagraph (A)(ii) shall apply for purposes of this
subparagraph.
``(3) Exception to overall limitation on itemized
deductions.--So much of any deduction allowed under section
170 as does not exceed the qualified contributions paid
during the taxable year shall not be treated as an itemized
deduction for purposes of section 68.
``(4) Qualified contributions.--
``(A) In general.--For purposes of this subsection, the
term `qualified contribution' means any charitable
contribution (as defined in section 170(c)) if--
``(i) such contribution is paid during the period beginning
on August 28, 2005, and ending on December 31, 2005, in cash
to an organization described in section 170(b)(1)(A) (other
than an organization described in section 509(a)(3)),
``(ii) in the case of a contribution paid by a corporation,
such contribution is for relief efforts related to Hurricane
Katrina, Hurricane Rita, or Hurricane Wilma, and
``(iii) the taxpayer has elected the application of this
subsection with respect to such contribution.
``(B) Exception.--Such term shall not include a
contribution if the contribution is
[[Page H11159]]
for establishment of a new, or maintenance in an existing,
segregated fund or account with respect to which the donor
(or any person appointed or designated by such donor) has, or
reasonably expects to have, advisory privileges with respect
to distributions or investments by reason of the donor's
status as a donor.
``(C) Application of election to partnerships and s
corporations.--In the case of a partnership or S corporation,
the election under subparagraph (A)(iii) shall be made
separately by each partner or shareholder.
``(b) Suspension of Certain Limitations on Personal
Casualty Losses.--Paragraphs (1) and (2)(A) of section 165(h)
shall not apply to losses described in section 165(c)(3)--
``(1) which arise in the Hurricane Katrina disaster area on
or after August 25, 2005, and which are attributable to
Hurricane Katrina,
``(2) which arise in the Hurricane Rita disaster area on or
after September 23, 2005, and which are attributable to
Hurricane Rita, or
``(3) which arise in the Hurricane Wilma disaster area on
or after October 23, 2005, and which are attributable to
Hurricane Wilma.
In the case of any other losses, section 165(h)(2)(A) shall
be applied without regard to the losses referred to in the
preceding sentence.
``(c) Required Exercise of Authority Under Section 7508a.--
In the case of any taxpayer determined by the Secretary to be
affected by the Presidentially declared disaster relating to
Hurricane Katrina, Hurricane Rita, or Hurricane Wilma, any
relief provided by the Secretary under section 7508A shall be
for a period ending not earlier than February 28, 2006.
``(d) Special Rule for Determining Earned Income.--
``(1) In general.--In the case of a qualified individual,
if the earned income of the taxpayer for the taxable year
which includes the applicable date is less than the earned
income of the taxpayer for the preceding taxable year, the
credits allowed under sections 24(d) and 32 may, at the
election of the taxpayer, be determined by substituting--
``(A) such earned income for the preceding taxable year,
for
``(B) such earned income for the taxable year which
includes the applicable date.
``(2) Qualified individual.--For purposes of this
subsection--
``(A) In general.--The term `qualified individual' means
any qualified Hurricane Katrina individual, any qualified
Hurricane Rita individual, and any qualified Hurricane Wilma
individual.
``(B) Qualified hurricane katrina individual.--The term
`qualified Hurricane Katrina individual' means any individual
whose principal place of abode on August 25, 2005, was
located--
``(i) in the GO Zone, or
``(ii) in the Hurricane Katrina disaster area (but outside
the GO Zone) and such individual was displaced from such
principal place of abode by reason of Hurricane Katrina.
``(C) Qualified hurricane rita individual.--The term
`qualified Hurricane Rita individual' means any individual
(other than a qualified Hurricane Katrina individual) whose
principal place of abode on September 23, 2005, was located--
``(i) in the Rita GO Zone, or
``(ii) in the Hurricane Rita disaster area (but outside the
Rita GO Zone) and such individual was displaced from such
principal place of abode by reason of Hurricane Rita.
``(D) Qualified hurricane wilma individual.--The term
`qualified Hurricane Wilma individual' means any individual
whose principal place of abode on October 23, 2005, was
located--
``(i) in the Wilma GO Zone, or
``(ii) in the Hurricane Wilma disaster area (but outside
the Wilma GO Zone) and such individual was displaced from
such principal place of abode by reason of Hurricane Wilma.
``(3) Applicable date.--For purposes of this subsection,
the term `applicable date' means--
``(A) in the case of a qualified Hurricane Katrina
individual, August 25, 2005,
``(B) in the case of a qualified Hurricane Rita individual,
September 23, 2005, and
``(C) in the case of a qualified Hurricane Wilma
individual, October 23, 2005.
``(4) Earned income.--For purposes of this subsection, the
term `earned income' has the meaning given such term under
section 32(c).
``(5) Special rules.--
``(A) Application to joint returns.--For purposes of
paragraph (1), in the case of a joint return for a taxable
year which includes the applicable date--
``(i) such paragraph shall apply if either spouse is a
qualified individual, and
``(ii) the earned income of the taxpayer for the preceding
taxable year shall be the sum of the earned income of each
spouse for such preceding taxable year.
``(B) Uniform application of election.--Any election made
under paragraph (1) shall apply with respect to both section
24(d) and section 32.
``(C) Errors treated as mathematical error.--For purposes
of section 6213, an incorrect use on a return of earned
income pursuant to paragraph (1) shall be treated as a
mathematical or clerical error.
``(D) No effect on determination of gross income, etc.--
Except as otherwise provided in this subsection, this title
shall be applied without regard to any substitution under
paragraph (1).
``(e) Secretarial Authority to Make Adjustments Regarding
Taxpayer and Dependency Status.--With respect to taxable
years beginning in 2005 or 2006, the Secretary may make such
adjustments in the application of the internal revenue laws
as may be necessary to ensure that taxpayers do not lose any
deduction or credit or experience a change of filing status
by reason of temporary relocations by reason of Hurricane
Katrina, Hurricane Rita, or Hurricane Wilma. Any adjustments
made under the preceding sentence shall ensure that an
individual is not taken into account by more than one
taxpayer with respect to the same tax benefit.''.
(b) Conforming Amendments.--
(1) Subsection (b) of section 38 is amended by striking
``and'' at the end of paragraph (25), by striking the period
at the end of paragraph (26) and inserting a comma, and by
adding at the end the following new paragraphs:
``(27) the Hurricane Katrina employee retention credit
determined under section 1400P(a),
``(28) the Hurricane Rita employee retention credit
determined under section 1400P(b), and
``(29) the Hurricane Wilma employee retention credit
determined under section 1400P(c).''.
(2) The table of sections for part II of subchapter Y of
chapter 1 is amended by adding at the end the following new
items:
``Sec. 1400O. Special rules for use of retirement funds.
``Sec. 1400P. Employment relief.
``Sec. 1400Q. Additional tax relief provisions.''.
(3) The heading for such part is amended by striking ``GULF
OPPORTUNITY ZONE'' and inserting ``HURRICANE RELIEF''.
(4) The following provisions of the Katrina Emergency Tax
Relief Act of 2005 are hereby repealed:
(A) Title I.
(B) Sections 202, 301, 402, 403(b), 406, and 407.
TITLE III--OTHER PROVISIONS
SEC. 301. SECRETARIAL AUTHORITY TO EXTEND PERIOD DURING WHICH
TRAVELING EXPENSES ARE TREATED AS INCURRED AWAY
FROM HOME IN CASE OF MAJOR DISASTER.
(a) In General.--Section 162 (relating to trade or business
expenses) is amended by redesignating subsection (q) as
subsection (r) and by inserting after subsection (p) the
following new subsection:
``(q) Limitation on Traveling Expenses.--
``(1) In general.--For purposes of subsection (a)(2), the
taxpayer shall not be treated as being temporarily away from
home during any period of employment if such period exceeds 1
year.
``(2) Authority to extend in case of major disaster.--In
the case of a taxpayer who is away from home in pursuit of a
trade or business by reason of a disaster which the President
has declared to be a major disaster under section 401 of the
Robert T. Stafford Disaster Relief and Emergency Assistance
Act, the Secretary may extend the 1-year period referred to
in paragraph (1) for a period not exceeding 1 additional
year.
``(3) Exception for certain federal employees designated by
the attorney general.--Paragraph (1) shall not apply to any
Federal employee during any period for which such employee is
certified by the Attorney General (or the designee thereof)
as traveling on behalf of the United States in temporary duty
status to investigate or prosecute, or provide support
services for the investigation or prosecution of, a Federal
crime.''.
(b) Conforming Amendment.--Subsection (a) of section 162 is
amended by striking the last two sentences.
(c) Effective Date.--The amendments made by this section
shall apply to amounts paid or incurred after the date of the
enactment of this Act.
SEC. 302. GULF COAST RECOVERY BONDS.
It is the sense of the Congress that the Secretary of the
Treasury, or the Secretary's delegate, should designate one
or more series of bonds or certificates (or any portion
thereof) issued under section 3105 of title 31, United States
Code, as ``Gulf Coast Recovery Bonds'' in response to
Hurricanes Katrina, Rita, and Wilma.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Louisiana (Mr. McCrery) and the gentleman from Louisiana (Mr.
Jefferson) each will control 20 minutes.
The Chair recognizes the gentleman from Louisiana.
Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, the Gulf Opportunity Zone Act of 2005 is a reflection of
the commitment that President Bush made shortly after Hurricane Katrina
hit the shores of the Gulf of Mexico. He talked about creating an
opportunity zone similar to the zone that we created in New York City
after the attacks of September 11, 2001.
The bill before us today, in fact, contains many of the provisions
that were contained in the Relief Act that created the opportunity zone
in New York City, and there are a few additional provisions regarding
housing, low income housing, the rehabilitation tax credit, and things
like that.
[[Page H11160]]
{time} 1445
The business incentives, the business tax incentives that are
designed to bring investment into the devastated areas of the gulf are,
in fact, almost exactly the same as those offered in Manhattan
following 9/11.
Mr. Speaker, this bill is extremely critical for a timely
redevelopment of the devastated areas along our gulf coast, Alabama,
Mississippi, Louisiana, particularly. This bill also provides some
relief for victims of hurricanes Rita and Wilma in southeast Texas and
in south Florida.
Mr. Speaker, I cannot overemphasize the importance of putting into
law as quickly as possible incentives to give businesses, individuals,
people with capital to invest, the urge to go to these devastated areas
and invest that capital, take a risk, create the jobs necessary to
build back a critical mass of economic activity in these devastated
areas. If we do not do that, Mr. Speaker, and do it very soon, we are
going to have more and more businesses making decisions every day not
to go back into these devastated areas and not to invest their capital
back in those areas. Why should they, if there are hurdles to overcome
that are not present in, say, Dallas or Houston or Atlanta, other
places where they can take that capital and invest it and not have the
hassles, the obstacles, that are present in these devastated areas.
That was the whole point of providing tax incentives to businesses in
New York City following 9/11. It is the point of this bill, to give
people an extra reason, a little extra incentive to put that capital in
these devastated areas to rebuild those areas.
Mr. Speaker, I am certainly thankful for the cooperation of the
gentleman from Louisiana (Mr. Jefferson) on the Ways and Means
Committee, also the ranking member of the Ways and Means Committee, the
chairman of the Ways and Means Committee, and the staff on both sides
of the aisle for their cooperation in putting together a rational,
reasonable approach to encouraging investment back in these areas.
Mr. Speaker, I reserve the balance of my time.
Mr. JEFFERSON. Mr. Speaker, I yield myself such time as I may
consume.
First, I would like to thank the gentleman from Louisiana (Mr.
McCrery) for joining me in introducing this important piece of
legislation. I also want to thank the chairman of the committee, Mr.
Thomas, and our ranking member, Mr. Rangel, for their efforts in
bringing this bill to the floor. I also would be remiss if I failed to
thank both the Republican and Democratic staff of the committee for
their extraordinary bipartisan effort to put this tax relief package
together.
And I want to do something which is a little bit out of order, and
that is to thank someone who is not properly a Member of this body, our
mayor of New Orleans, Ray Nagin, who is here with us today. He has, as
much as anyone, pushed this House and this Senate and our Congress and
our President to make sure that our region is not forgotten; and I want
to thank him for his presence here in the Chamber.
Mr. Speaker, the Gulf Opportunity Zone Act of 2005 provides much
needed aid and comfort to the victims of hurricanes Katrina, Rita, and
Wilma across the gulf coast and provides a much-needed shot in the arm
to the many thousands of businesses that have been shuttered, suffered
serious damage, or have seen their customer bases erode significantly
or disappear in the wake of horrible storms.
The economy of the gulf coast and particularly that of my home State
of Louisiana has been severely compromised by the ravages of two
terrible storms. One of our Nation's largest and most economically
important cities, the city of New Orleans, was evacuated and
commercially shuttered for most of the fall. Even today, as New Orleans
slowly regains her footing, most of her citizens remain in a hurricane-
forced exile as the city's businesses struggle to rebuild and to make a
fresh start with a significantly diminished customer base,
extraordinary costs of repair and reconstruction, and a distressed
infrastructure.
Mr. Speaker, the cities, parishes across the gulf coast, and counties
across the gulf coast are struggling to recover from a deluge that laid
them low. My constituents and those of my gulf coast colleagues,
however, are a resilient people. They have confronted natural disasters
before, and they have emerged triumphant and stronger still. I have
every confidence that the same is true today. With the right tools in
their tool box, New Orleanians and our neighbors in Louisiana,
Mississippi, Alabama, and Florida will rebuild and recover and a
brighter future will emerge.
Today, Mr. Speaker, with the passage of this important piece of
legislation, we provide the entrepreneurs of the gulf coast a sturdy
set of tools with which to jump-start our recovery. We also address an
unprecedented housing crisis with unprecedented resources to rebuild
and rehouse the thousands whose homes are damaged or destroyed by these
vicious storms.
We also are keenly aware of the financial crisis that the States, our
cities, our parishes are confronting. In order to ease those burdens,
this bill also provides several important tools to give our hometowns
access to the capital they need to survive in the short term and thrive
over the long run: $500 million in tax credit bonds to meet debt
service needs, $3 billion in partially guaranteed general obligation
bonds, and $7.75 billion in private activity bond authority. I am
confident that by properly leveraging these tools, the States, our
cities, parishes, school boards and others will emerge from the
hurricane stronger than before they struck.
Mr. Speaker, with the passage of this act, businesses in New Orleans
and surrounding parishes will enjoy tremendous tax advantages for the
next few years that should give them the boost they need to survive and
a little leg up to get ahead over the longer term: expanded section 179
expensing for small businesses; bonus depreciation; expenses for
demolition and clean-up costs, including brownfields clean-up; an
enhanced rehabilitation tax credits; and increased net operating loss
carry-back among others.
By affording these tools to be combined with effective economic
planning, the House today greatly enhances the opportunity for a great,
but shattered, community to rebuild, not just to recover, but to become
more survivable, more sustainable, more equitable, and more prosperous
over some time, but all at once.
Mr. Speaker, the efforts of my colleagues in providing the relief we
need in the gulf coast have been unparalleled to any I have witnessed
during my tenure in Congress. For that I am extraordinarily grateful.
However, we still have a long way to go before we achieve the full
recovery that I know we all want. I look forward to working with each
of you in the coming weeks and months as we rise to the challenge of
ensuring that, like the Phoenix of myth and fable, New Orleans rises
from the devastation of Hurricane Katrina as a bright shining model of
American ingenuity and opportunity.
Mr. Speaker, I reserve the balance of my time.
Mr. McCRERY. Mr. Speaker, I yield 2 minutes to the distinguished
gentleman from Florida (Mr. Shaw), chairman of the Trade Subcommittee
of the Ways and Means Committee.
Mr. SHAW. Mr. Speaker, Florida did not receive the devastation that
the gulf coast did with Katrina. Katrina's track came across Florida,
got into the gulf, and actually affected my district on its way through
Florida, but in a very slight manner. When it got into the warm waters
of the Gulf of Mexico, it grew into a category 5 storm and just wreaked
devastation on the New Orleans/southern Mississippi area.
I support this bill and all it does. But then this was followed by
two other storms, Rita and Wilma. Wilma, of course, came across
Florida, and in Broward County delivered the most powerful winds that
we have seen in over 40 years. And Palm Beach County, as well as Dade
County. And coming across the State the way it did from the gulf to the
Atlantic made it most unusual as far as the power that it gained, or
retained, coming across the Florida Everglades.
We have been damaged in Florida as well. But of course our
devastation and our problems are overshadowed by the tragedy of Katrina
in Louisiana and Mississippi.
This bill is a reasonable bill. It sets forth incentives and some
relief in the Tax Code because of the devastation
[[Page H11161]]
delivered by these three storms. I urge the Members to support this
bill and expedite its passage as quickly as possible.
Mr. JEFFERSON. Mr. Speaker, I yield 2 minutes to the gentlewoman from
Ohio (Mrs. Jones), a distinguished member of the Ways and Means
Committee.
Mrs. JONES of Ohio. Mr. Speaker, I would like to thank the gentlemen
from Louisiana for yielding me this time, and I would like to
congratulate them on their leadership on these issues.
I rise in strong support of the legislation today. As we learned in
yesterday's congressional hearings, the victims of Hurricane Katrina,
that is, the residents of the gulf region, are in need of help now. I
rise in support and I am glad to see that this legislation, as was
contemplated previously, incorporates some of the provisions of the
legislation I introduced earlier in the year called the Katrina
Assistance Tax Relief Incentive for Necessities Act. And it
incorporated the Housing opportunity credits, the temporary housing tax
credit, a homebuyer tax credit, doubling the low-income housing tax
credit to assist Katrina victims.
The place I want to weigh in at this moment however is on the
importance, and I say this again, the importance of assuring that the
people of these gulf regions have an opportunity to enjoy some of the
work that is provided businesses by these tax credits. What I am
worried about is that there are people coming from all over the country
who do not live in these areas who are not having the opportunity to
get a job. There are people spread in 44 States across this country who
are from Louisiana, who are from Mississippi, who are from Alabama; and
they want to come back and work. And there are businesses right there
in those communities who want to have an opportunity to rebuild their
communities, and it is not happening.
I use this opportunity to say to the world, to say to my colleagues
who are allocating resources for the rebuilding of the Katrina area, of
the Katrina relief area, that we need to assure that the people of the
area have an opportunity to rebuild their houses, have an opportunity
to get jobs and put their lives back on track.
Again, I thank my colleagues for sponsoring this legislation. I am
glad to join with you as a member of the Ways and Means Committee in
support.
Mr. McCRERY. Mr. Speaker, I yield 2 minutes to the gentleman from
Texas (Mr. Brady), a distinguished member of the Ways and Means
Committee.
Mr. BRADY of Texas. Mr. Speaker, I want to thank Chairman McCrery and
Mr. Jefferson for their leadership on this bill. I am proud to be from
Texas, a State that when victims fled the wrath of Hurricane Katrina we
had communities and churches and homes that opened their arms to take
them in. Later, in Hurricane Rita, those same communities were
devastated as well. And I just want to tell Chairman McCrery that the
relief that we are providing today in this bill is critically important
to the families of east and southeast Texas.
We, like you, need this relief today. What this will do is help
families cope financially, encourage companies to keep workers on their
payrolls during these tough economic times, and help rebuild the
important Texas timber industry which suffered devastating losses. In
some communities today, almost half of the homes still do not have even
the temporary blue tarp to keep the rain out. We need families to be
able to dip into their savings without penalty, fully deduct all of the
personal property losses. And for the working poor, we want to make
sure that their child and earned income tax credits are not impacted by
Hurricane Rita.
This also permits unlimited cash donations by companies, which is
very important to the communities, and provides up to $2,400 per worker
for small businesses to keep employees on the payroll through the end
of the year. And then finally, to address our devastating timber and
economic losses, we help small property owners reforest their crop, and
we help them spread their losses across the past 5 years. This is
important relief to Texas. We are proud to join with the other Gulf
Coast States in moving this forward and the sooner we get this on the
President's desk, the better.
Mr. JEFFERSON. Mr. Speaker, I yield 3 minutes to the gentlewoman from
Nevada (Ms. Berkley).
Ms. BERKLEY. Mr. Speaker, the goal of passing today's legislation is
to help businesses in the gulf coast region reopen their doors and get
people back to work. However, this legislation excludes perhaps the
most important industry in the region that employs over 50,000 people
in Mississippi and Louisiana and pays over $800 million in State and
local tax revenue, that is, the gaming industry. The gaming industry
has made substantial contribution to the regional economy of the gulf
coast and will invest billions of dollars as it rebuilds, making it an
essential part of restoring employment, economic growth, and tax
revenue to the area.
{time} 1500
I am dismayed that the biased view of one congressman has resulted in
this bill excluding a group of employers that provide good jobs and tax
revenue to the hurricane-ravaged region. I am astounded that one Member
who has a long-held contempt for the gaming industry can insert
language in this legislation, which is supposed to be helping the
victims of Katrina, that will prevent thousands of our fellow citizens
from going back to work, going back to their homes, reuniting with
their families, and begin to live a normal life again. I am angry that
we are carving out an exception for one business in this legislation, a
legitimate business, a well-regulated business, a business whose
companies are traded on the New York Stock Exchange, a business that
employs thousands of people in the region and generates millions of
dollars in tax revenue. This makes no sense. And I am outraged, if I
may say so, Mr. Speaker, that the Republican leadership has caved in
and agreed to this provision because it is rumored that this
congressman threatened to withhold his support from tomorrow's tax
reconciliation vote unless his provision was put in the Katrina vote,
contrary to what it will do to our fellow citizens.
Trading thousands of jobs for our fellow citizens for a vote is an
affront to those people who need these gaming jobs to get back on their
feet again. Shame on this body for allowing the gaming industry or any
industry to be discriminated against in this legislation.
The gaming companies remain committed to the communities and the
people in the hurricane-affected region. I hope Congress will come to
our senses in conference and ensure that every business is treated
fairly and given the opportunity to recover from Hurricane Katrina.
This Christmas, while we, Members of Congress, are sitting by our
fireplaces in our comfortable homes, surrounded by our families, let us
think about the thousands of victims of the Katrina hurricane who are
homeless, who are jobless, away from their families this year and maybe
next Christmas too, because this single congressman dislikes one
business in this country and is putting his personal feelings above the
well-being of our fellow citizens. This is a shame. It is an
embarrassment, and we ought to rethink this and give tax breaks. If we
are giving to one business, we should be giving to all and not be
discriminating because of a personal dislike by one Member of this
body.
Mr. McCRERY. Mr. Speaker, I yield 2 minutes to the distinguished
gentleman from Nevada (Mr. Porter).
Mr. PORTER. Mr. Speaker, I too share the pain of those families that
were impacted by the terrible storms in the Gulf Coast, having been
there within 24 hours after the devastating storm, seeing it firsthand
and helping those families. But I stand today to talk about the
equitability of this particular proposal.
There is a number of industries that have been impacted from all
walks of life, but there are close to 50,000 families that are being
impacted by a carve-out in this legislation, 50,000 hard-working moms
and dads trying to take care of their kids.
I believe in equitable treatment, and the gaming industry that has
been carved is not asking for special treatment. They are asking to be
treated like every other business. And as a Member of this body, I
believe firmly
[[Page H11162]]
that States do have rights, and I believe that local communities have
rights, and they have made decisions to allow these businesses to
prosper as they are a big part of their economy.
As my colleague from Nevada said, close to $800 million a year into
their economy and close to 50,000 jobs. Again, I stand here asking for
equitable treatment for a tax-paying business that is approved by State
and Federal laws, and they too should be treated equally. I am
extremely disappointed, and I believe when we start a carve-out
process, it is a slippery slope for this Congress to be telling local
governments and State governments who should be receiving these tax
credits.
Mr. JEFFERSON. Mr. Speaker, I yield 3 minutes to the gentlewoman from
Houston, Texas (Ms. Jackson-Lee).
(Ms. JACKSON-LEE of Texas asked and was given permission to revise
and extend her remarks.)
Ms. JACKSON-LEE of Texas. Mr. Speaker, allow me to likewise lend and
associate myself with the remarks of the leadership of the two
gentlemen from Louisiana, both in terms of the legislation written, but
also the inclusiveness of this legislation.
I am one that has seen the aftermath of the Katrina tragedy and
certainly my constituents who experienced the suffering of Hurricane
Rita and those of us who have encountered the devastation of Hurricane
Wilma. The relevance of the United States as a Federal Government is to
be the safety net and the umbrella for the American people. We know
that there were many failures as it relates to Hurricane Katrina, and
we are making our way steadily to determine the facts of where we
failed in helping those people and helping those keep and secure their
property, and also to answer the questions for those families who lost
loved ones. This legislation, however, is a step forward and it
provides incentives to small businesses and businesses in the region.
It is inclusive and includes the hurricanes of Wilma and Rita. Rita
impacted the State of Texas, and Hurricane Katrina impacted the State
of Texas as we have welcomed into areas of Houston those survivors and
evacuees who came from the other regions that were hit directly by
Hurricane Katrina. This provides entrepreneurs with tools, and
entrepreneurs with tools creates jobs. We know that small businesses
and medium-size businesses are the backbone of America.
So I thank Mr. Jefferson for the housing assistance. I thank him for
the access to capital. It makes a difference. It allows our local
authorities and State authorities to get back on their feet.
But I must add my concern having been to States like Louisiana and
Mississippi, where I have seen the healthy gaming industry that is not
filled with corruption because it has been regulated very well by
States and oversight by the Federal Government, where it gives $800
million to the infrastructure of various States, and yet this
particular bill excludes the rebuilding or the help in the rebuilding
of those particular institutions.
Mr. Speaker, they provide jobs to thousands upon thousands of people
in Mississippi and Louisiana. It is imperative that we reconsider this
aspect of the bill, and I am hoping that we will have an opportunity
for a freestanding incentive bill to help all the businesses come back
in the region.
Might I also offer and hope that my colleagues would consider a
concept that I have raised called the Urban Village Tax Credit, and
that is to give relief to many of those who opened their homes. Oh,
yes, some may say they were their relatives, but many were not. There
were many in my constituency who had 10, 20, 30, 40, 50 people in their
homes, churches and other institutions, religious institutions, who
took people in not because they wanted a tax incentive but because it
was right, because they cared. So I would hope that my colleagues
consider the Urban Village Tax Credit, which gives some tax credit
relief to those who can document that they took families in during this
tragic time. We are all one family and one America.
This is a great tax bill, and I would hope my colleagues would vote
on it and consider the Urban Village Tax Credit.
Mr. McCRERY. Mr. Speaker, I yield 2 minutes to the distinguished
gentleman from Virginia (Mr. Wolf).
Mr. WOLF. Mr. Speaker, I rise today in support of H.R. 4440, the
redevelopment tax package. I want to thank Chairman Thomas, Chairman
McCrery, and the Republican leadership for addressing the concerns of a
lot of Members. There were 65 Members who signed the initial letter and
30 some that have signed the second letter on this issue.
We all want to help the people of the Gulf Coast, and every fair-
minded American want to give hurricane-ravaged areas the Federal
assistance they need to rebuild bridges, roads, hospitals, water and
sewer.
While the Katrina tax package recently passed by the other body would
allow benefits to rebuild massage parlors, liquor stores, and casinos
because it does not contain a specific prohibition against it, this
bill follows legislative history and regular order in where Federal
dollars go to rebuild critical infrastructure like hospitals, homes,
and communities.
The House bill, I again stress, following precedent in redevelopment
assistance legislation going back more than 20 years, expressly
prohibits tax incentives from going to industries that I referred.
Congress has a long history of limiting certain types of businesses
from receiving redevelopment tax benefits. The bill before us today
continues that precedent of not allowing our constituents' hard-earned
tax dollars in these times of record deficits to subsidize the
rebuilding of a massage parlor, a liquor store, or a casino.
Just as Congress has historically done, we need to target our limited
Federal resources to the areas that need it. It would be my expectation
that when the measure comes out of conference, it will retain the
provisions that ensure that tax incentives to rebuild the Gulf region
are used wisely and effectively.
It would be very difficult, almost impossible, to go to a town
meeting sometime and say that I have supported or anyone has or the
Congress supported giving tax breaks to rebuild whether it be a
gambling casino or a massage parlor or a liquor store, and what we are
doing today follows the law that we have done in the past.
I thank the gentleman for yielding me this time.
Mr. JEFFERSON. Mr. Speaker, I yield myself such time as I may
consume.
I would like to make brief remarks to again thank all who have worked
on this bill, particularly Mr. Thomas, Mr. McCrery, and Mr. Rangel for
their work and support. It is going to mean a lot to our region, a lot
to my city and my district. And a great part of what we have to do, of
course, is to give business the tools it needs to partner with our
government to get businesses stood up, to get people back into jobs, to
get housing back into our communities so that we can restore our
depopulated city and other depopulated parts of parishes around
Louisiana and throughout counties in Mississippi and Alabama, and this
bill is going to go a long way toward helping us do that.
Mr. Speaker, I have no further requests for time, and I yield back
the balance of my time.
Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, many of the provisions in this bill, in fact, most of
the provisions in this bill, are simply tools that the Federal
Government will give to individuals and businesses in the devastated
areas to help themselves. The bonding provisions, for example, that Mr.
Jefferson spoke of, all of those are simply tools to allow the people
in these devastated areas to help pick themselves up and restart their
communities. The refinancing provision, for example, allowing States to
basically refinance existing bonded obligations, that is a way that we
are going to allow States to help themselves.
So, Mr. Speaker, I hope that this House will today take the first
step to getting this necessary help to these devastated areas and then,
before we leave here for the Christmas holidays, pass a final version
that we can send to the President for his signature. It is critical.
Mr. SHAYS. Mr. Speaker, I rise in support of H.R. 4440, the Gulf
Opportunity Zone Act, which provides tax incentives for businesses to
invest in and rebuild the Gulf Coast communities ravaged by hurricanes.
[[Page H11163]]
I am pleased these federal resources will not be used to support the
gambling facilities, liquor stores and massage parlors. I don't believe
the federal government should help interests that have dubious value to
these communities.
I believe gambling is inherently dishonest and am opposed to it in
any form. During my 14 years in the state legislature I voted against
every gambling bill. Gambling financially cripples those who can least
afford it--the poor--through the cruel and misleading lure of ``winning
it big.''
With the budget deficits growing to historic levels, we need to make
sure tax dollars are being used in the wisest possible manner to
rebuild the region's businesses and housing.
Fair-minded Americans support tax incentives to spur business
reinvestment along the hurricane-ravaged Gulf coast to help victims
there rebuild their lives.
Tax breaks for the gaming industry simply do not make sense.
I urge my colleagues to support this resolution.
Mr. GIBBONS. Mr. Speaker, I rise today in support of those
communities in the gulf coast region who have been devastated by the
recent hurricanes.
However, while well-intentioned, I find today's legislation to spur
economic development in the gulf coast region to be significantly
flawed in that it specifically excluded a key industry in the area.
Never before in any previous disaster relief legislation, has
Congress picked winners and losers. We should not start today.
Businesses on the gulf coast have invested billions of dollars in
infrastructure that Hurricane Katrina reduced to rubble in a matter of
hours. The gaming industry employs tens of thousands of people in the
gulf coast region.
It should be treated equally in legislation seeking to assist the
rebuilding of businesses destroyed by Hurricane Katrina. The gaming
businesses are legal, well-regulated, and publicly traded companies
that should not be discriminated against in Federal economic assistance
legislation.
Many people in this region lost everything; their homes, their jobs,
personal belongings, and the schools their kids attended. It is
regrettable that some in Congress are willing to put the hardship of
one displaced individual--who may work for a refinery or a grocery
store--over another individual's who happens to work in the gaming
industry.
This was a terrible disaster and loss for everyone, and Congress
today is ignoring that simple fact.
I will not support the Gulf Opportunity Zone legislation today,
because I am extremely disturbed with the dangerous precedent this
sets.
I will work with our delegation and the conference committee to
ensure that the final bill includes equal treatment for the gaming
industry--just like any other business in the gulf coast region.
Mr. McCRERY. Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore (Mr. Simpson). The question is on the motion
offered by the gentleman from Louisiana (Mr. McCrery) that the House
suspend the rules and pass the bill, H.R. 4440.
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds of
those present have voted in the affirmative.
Mr. McCRERY. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the
Chair's prior announcement, further proceedings on this question will
be postponed.
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