H.R. 5829 (Introduced in House) — To amend the Internal Revenue Code of 1986 to provide an exception for certain public-private research arrangements from the business use test for purposes of determining private activity bonds.

1. Exception to business use test for certain public-private research arrangements

(a)

In general— Section 141(b) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

“(10) Exception for certain research arrangements

“(A) In general—Paragraph (1) shall not apply to an issue if the proceeds of such issue are to be used under an arrangement relating to basic research at a facility—

“(i) owned by a governmental unit or a 501(c)(3) organization, and

“(ii) the governmental unit or a 501(c)(3) organization enters into a bona fide, arm’s-length contractual arrangement with a person other than a governmental unit or a 501(c)(3) organization regarding the terms for sharing the economic benefits of any products resulting from basic research, including arrangements in which those economic terms (such as exclusive or non-exclusive licenses of intellectual property and licensing fees or royalty rates) are determined in advance at the time the parties enter into the contractual arrangement.

“(B) Basic research—For purposes of subparagraph (A), the term basic research means any original investigation for the advancement of scientific knowledge not having a specific commercial objective.”

(b)

Effective date— The amendment made by subsection (a) shall apply to research agreements entered into after the date of the enactment of this Act.

To amend the Internal Revenue Code of 1986 to provide an exception for certain public-private research arrangements from the business use test for purposes of determining private activity bonds.

1. Exception to business use test for certain public-private research arrangements

Cite this provision

Incoming references