Division M — Revenue provisions

“6431A. Credit allowed to issuer for qualified infrastructure bonds

“(a) In general—In the case of a qualified infrastructure bond, the issuer of such bond shall be allowed a credit with respect to each interest payment under such bond which shall be payable by the Secretary as provided in subsection (b).

“(b) Payment of credit

“(1) In general—The Secretary shall pay (contemporaneously with each date on which interest is so payable) to the issuer of such bond (or to any person who makes such interest payments on behalf of such issuer) an amount equal to the applicable percentage of such interest so payable.

“(2) Applicable percentage—For purposes of this subsection, except as provided in subsection (d), the applicable percentage with respect to any bond shall be determined under the following table:

“(3) Limitation

“(A) In general—The amount of any interest payment taken into account under paragraph (1) with respect to a bond for any payment date shall not exceed the amount of interest which would have been payable under such bond on such date if such interest were determined at the rate which the Secretary estimates will permit the issuance of qualified infrastructure bonds with a specified maturity or redemption date without discount and without additional interest cost.

“(B) Date of rate determination with respect to bond—Such rate with respect to any qualified infrastructure bond shall be determined as of the first day on which there is a binding, written contract for the sale or exchange of the bond.

“(c) Qualified infrastructure bond

“(1) In general—For purposes of this section, the term “qualified infrastructure bond” means any bond (other than a private activity bond) issued as part of an issue if—

“(A) 100 percent of the available project proceeds of such issue are to be used for capital expenditures or operations and maintenance expenditures in connection with property the acquisition, construction, or improvement of which would be a capital expenditure,

“(B) the interest on such bond would (but for this section) be excludable from gross income under section 103,

“(C) the issue price has not more than a de minimis amount (determined under rules similar to the rules of section 1273(a)(3)) of premium over the stated principal amount of the bond, and

“(D) prior to the issuance of such bond, the issuer makes an irrevocable election to have this section apply.

“(2) Applicable rules—For purposes of applying paragraph (1)—

“(A) Not treated as federally guaranteed—For purposes of section 149(b), a qualified infrastructure bond shall not be treated as federally guaranteed by reason of the credit allowed under this section.

“(B) Application of arbitrage rules—For purposes of section 148, the yield on a qualified infrastructure bond shall be reduced by the credit allowed under this section.

“(d) Definition and special rules—For purposes of this section—

“(1) Interest includible in gross income—For purposes of this title, interest on any qualified infrastructure bond shall be includible in gross income.

“(2) Available project proceeds—The term “available project proceeds” means—

“(A) the excess of—

“(i) the proceeds from the sale of an issue, over

“(ii) the sum of—

“(I) issuance costs financed by the issue (the extent that such costs do not exceed 2 percent of such proceeds), and

“(II) amounts in a reasonably required reserve (within the meaning of section 150(a)(3)) with respect to such issue), and

“(B) the proceeds from any investment of the excess described in clause (i).

“(3) Current refundings allowed

“(A) In general—In the case of a bond issued to refund a qualified infrastructure bond, such refunding bond shall be treated as a qualified infrastructure bond for purposes of this section if—

“(i) the average maturity date of the issue of which the refunding bond is a part is not later than the average maturity date of the bonds to be refunded by such issue,

“(ii) the amount of the refunding bond does not exceed the outstanding amount of the refunded bond,

“(iii) the refunded bond is redeemed not later than 90 days after the date of the issuance of the refunding bond, and

“(iv) the refunded bond was issued more than 30 days after the date of the enactment of this section.

“(B) Applicable percentage limitation—The applicable percentage with respect to any bond to which subparagraph (A) applies shall be 30 percent.

“(C) Determination of average maturity—For purposes of subparagraph (A)(i), average maturity shall be determined in accordance with section 147(b)(2)(A).

“(D) Application of Davis-Bacon Act requirements with respect to qualified infrastructure bonds—Subchapter IV of chapter 31 of the title 40, United States Code, shall apply to projects financed with the proceeds of qualified infrastructure bonds.

“(e) Regulations—The Secretary may prescribe such regulations and other guidance as may be necessary or appropriate to carry out this section.”

“(xiv) Determination of initial temporary period—For purposes of this subparagraph, the end of the initial section temporary period shall be determined without regard to section 149(d)(3)(A)(iv).”

“(I) Inflation adjustment—In the case of any calendar year after 2020, the $30,000,000 amounts contained in subparagraphs (C)(i), (D)(i), and (D)(iii)(II) shall each be increased by an amount equal to—

“(i) such dollar amount, multiplied by

“(ii) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year, determined by substituting “calendar year 2019” for “calendar year 2016” in subparagraph (A)(ii) thereof.”

“(C) Manufacturing facility—For purposes of this paragraph—

“(i) In general—The term manufacturing facility means any facility which—

“(I) is used in the manufacturing or production of tangible personal property (including the processing resulting in a change in the condition of such property),

“(II) is used in the creation or production of intangible property which is described in section 197(d)(1)(C)(iii), or

“(III) is functionally related and subordinate to a facility described in subclause (I) or (II) if such facility is located on the same site as the facility described in subclause (I) or (II).

“(ii) Certain facilities included—The term “manufacturing facility” includes facilities that are directly related and ancillary to a manufacturing facility (determined without regard to this clause) if—

“(I) those facilities are located on the same site as the manufacturing facility, and

“(II) not more than 25 percent of the net proceeds of the issue are used to provide those facilities.

“(iii) Limitation on office space—A rule similar to the rule of section 142(b)(2) shall apply for purposes of clause (i).

“(iv) Limitation on refundings for certain property—Subclauses (II) and (III) of clause (i) shall not apply to any bond issued on or before the date of the enactment of the Renewable Energy, Efficiency, and Infrastructure Tax Act of 2020, or to any bond issued to refund a bond issued on or before such date (other than a bond to which clause (iii) of this subparagraph (as in effect before the date of the enactment of the Renewable Energy, Efficiency, and Infrastructure Tax Act of 2020) applies), either directly or in a series of refundings.”

“(H) Adjustment for inflation—In the case of any calendar year after 2020, the $30,000,000 amount in subparagraph (A) shall be increased by an amount equal to—

“(i) such dollar amount, multiplied by

“(ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year, determined by substituting “calendar year 2019” for “calendar year 2016” in subparagraph (A)(ii) thereof.”

“(5) any exempt facility bond issued as part of an issue described in paragraph (4) or (5) of section 142(a) if 95 percent or more of the net proceeds of such issue are to be used to provide facilities which—

“(A) will be used—

“(i) by a person who was, as of July 1, 2020, engaged in operation of a facility described in such paragraph, and

“(ii) to provide service within the area served by such person on such date (or within a county or city any portion of which is within such area), or

“(B) will be used by a successor in interest to such person for the same use and within the same service area as described in subparagraph (A).”

“(3) Application of Davis-Bacon Act requirements with respect to certain exempt facility bonds—If any proceeds of any issue are used for construction, alteration, or repair of any facility otherwise described in paragraph (4), (5), (15), or (16) of subsection (a), such facility shall be treated for purposes of subsection (a) as described in such paragraph only if each entity that receives such proceeds to conduct such construction, alteration, or repair agrees to comply with the provisions of subchapter IV of chapter 31 of title 40, United States Code with respect to such construction, alteration, or repair.”

“J School infrastructure bonds

“54BB. School infrastructure bonds

“(a) In general—If a taxpayer holds a school infrastructure bond on one or more interest payment dates of the bond 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 subsection (b) with respect to such dates.

“(b) Amount of credit—The amount of the credit determined under this subsection with respect to any interest payment date for a school infrastructure bond is 100 percent of the amount of interest payable by the issuer with respect to such date.

“(c) Limitation based on amount of tax

“(1) In general—The credit allowed under subsection (a) for any taxable year shall not exceed the excess of—

“(A) the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over

“(B) the sum of the credits allowable under this part (other than subpart C and this subpart).

“(2) Carryover of unused credit—If the credit allowable under subsection (a) exceeds the limitation imposed by paragraph (1) for such taxable year, such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year (determined before the application of paragraph (1) for such succeeding taxable year).

“(d) School infrastructure bond

“(1) In general—For purposes of this section, the term school infrastructure bond means any bond issued as part of an issue if—

“(A) 100 percent of the available project proceeds of such issue are to be used for the purposes described in section 70112 of the Moving Forward Act,

“(B) the interest on such obligation would (but for this section) be excludable from gross income under section 103,

“(C) the issue meets the requirements of paragraph (3), and

“(D) the issuer designates such bond for purposes of this section.

“(2) Applicable rules—For purposes of applying paragraph (1)—

“(A) for purposes of section 149(b), a school infrastructure bond shall not be treated as federally guaranteed by reason of the credit allowed under section 6431(a),

“(B) for purposes of section 148, the yield on a school infrastructure bond shall be determined without regard to the credit allowed under subsection (a), and

“(C) a bond shall not be treated as a school infrastructure bond if the issue price has more than a de minimis amount (determined under rules similar to the rules of section 1273(a)(3)) of premium over the stated principal amount of the bond.

“(3) 6-year expenditure period

“(A) In general—An issue shall be treated as meeting the requirements of this paragraph if, as of the date of issuance, the issuer reasonably expects 100 percent of the available project proceeds to be spent for purposes described in section 70112 of the Moving Forward Act within the 6-year period beginning on such date of issuance.

“(B) Failure to spend required amount of bond proceeds within 6 years—To the extent that less than 100 percent of the available project proceeds of the issue are expended at the close of the period described in subparagraph (A) with respect to such issue, the issuer shall redeem all of the nonqualified bonds within 90 days after the end of such period. For purposes of this paragraph, the amount of the nonqualified bonds required to be redeemed shall be determined in the same manner as under section 142.

“(e) Limitation on amount of bonds designated—The maximum aggregate face amount of bonds issued during any calendar year which may be designated under subsection (d) by any issuer shall not exceed the limitation amount allocated under subsection (g) for such calendar year to such issuer.

“(f) National limitation on amount of bonds designated—The national qualified school infrastructure bond limitation for each calendar year is—

“(1) $10,000,000,000 for 2021,

“(2) $10,000,000,000 for 2022, and

“(3) $10,000,000,000 for 2023.

“(g) Allocation of limitation

“(1) Allocations

“(A) States—After application of subparagraph (B) and paragraph (3)(A), the limitation applicable under subsection (f) for any calendar year shall be allocated by the Secretary among the States in proportion to the respective amounts received by all local educational agencies in each State under part A of title I of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 6311 et seq.) for the previous fiscal year relative to the total such amount received by all local educational agencies in for the most recent fiscal year ending before such calendar year.

“(B) Certain possessions—One-half of 1 percent of the amount of the limitation applicable under subsection (f) for any calendar year shall be allocated by the Secretary to possessions of the United States other than Puerto Rico for such calendar year.

“(2) Allocations to schools—The limitation amount allocated to a State or possession under paragraph (1) shall be allocated by the State educational agency (or such other agency as is authorized under State law to make such allocation) to issuers within such State or possession in accordance with the priorities described in section 70111(c) of the Moving Forward Act and the eligibility requirements described in section 70111(b) of such Act, except that paragraph (1)(C) of such section shall not apply to the determination of eligibility for such allocation.

“(3) Allocations for Indian schools

“(A) In general—One-half of 1 percent of the amount of the limitation applicable under subsection (f) for any calendar year shall be allocated by the Secretary to the Secretary of the Interior for schools funded by the Bureau of Indian Affairs for such calendar year.

“(B) Allocation to schools—The limitation amount allocated to the Secretary of the Interior under paragraph (1) shall be allocated by such Secretary to issuers or schools funded as described in paragraph (2). In the case of amounts allocated under the preceding sentence, Indian tribal governments (as defined in section 7701(a)(40)) shall be treated as qualified issuers for purposes of this subchapter.

“(4) Digital learning—Up to 10 percent of the limitation amount allocated under paragraph (1) or (3)(A) may be allocated by the State to issuers within such State to carry out activities to improve digital learning in accordance with section 70112(b) of the Moving Forward Act.

“(h) Interest Payment Date—For purposes of this section, the term interest payment date means any date on which the holder of record of the school infrastructure bond is entitled to a payment of interest under such bond.

“(i) Special Rules

“(1) Interest on school infrastructure bonds includible in gross income for federal income tax purposes—For purposes of this title, interest on any school infrastructure bond shall be includible in gross income.

“(2) Application of certain rules—Rules similar to the rules of subsections (f), (g), (h), and (i) of section 54A shall apply for purposes of the credit allowed under subsection (a).”

“6431B. Credit for operations and maintenance costs of government-owned broadband

“(a) In general—In the case of any eligible governmental entity, there shall be allowed a credit equal to the applicable percentage of the qualified broadband expenses paid or incurred by such entity during the taxable year which credit shall be payable by the Secretary as provided in subsection (b).

“(b) Payment of credit—Upon receipt from an eligible governmental entity of such information as the Secretary may require for purposes of carrying out this section, the Secretary shall pay to such entity the amount of the credit determined under subsection (a) for the taxable year.

“(c) Limitation—The amount of qualified broadband expenses taken into account under this section for any taxable year with respect to any qualified broadband network shall not exceed the product of $400 multiplied by the number of qualified households subscribed to the qualified broadband service provided by such network (determined as of any time during such taxable year).

“(d) Definitions—For purposes of this section—

“(1) Applicable percentage—The term “applicable percentage” means—

“(A) in the case of any taxable year beginning in 2020 through 2025, 30 percent,

“(B) in the case of any taxable year beginning in 2026, 26 percent, and

“(C) in the case of any taxable year beginning in 2027, 24 percent.

“(2) Eligible governmental entity—The term “eligible governmental entity” means—

“(A) any State, local, or Indian tribal government,

“(B) any political subdivision or instrumentality of any government described in subparagraph (A), and

“(C) any entity wholly owned by one or more entities described in subparagraph (A) or (B).

“(3) Qualified broadband expenses—The term “qualified broadband expenses” means so much of the amounts paid or incurred for the operation and maintenance of a qualified broadband network as are properly allocable to qualified households subscribed to the qualified broadband service provided by such network.

“(4) Qualified household—The term “qualified household” means a personal residence which—

“(A) is located in a low-income community (as defined in section 45D(e)), and

“(B) did not have access to qualified broadband service from the eligible governmental entity (determined as of the beginning of the taxable year of such entity).

“(5) Qualified broadband network—The term “qualified broadband network” means property owned by an eligible governmental entity and used for the purpose of providing qualified broadband service.

“(6) Qualified broadband service—The term “qualified broadband service” means fixed, terrestrial broadband service providing downloads at a speed of at least 25 megabits per second and uploads at a speed of at least 3 megabits per second.

“(7) Taxable year—Except as otherwise provided by the Secretary, the term “taxable year” means, with respect to any eligible governmental entity, the fiscal year of such entity.

“(e) Special rules

“(1) Allocations—For purposes of subsection (d)(3), amounts shall be treated as properly allocated if allocated ratably among the subscribers of the qualified broadband service.

“(2) Denial of double benefit—Qualified broadband expenses shall not include any amount which is paid or reimbursed (directly or indirectly) by any grant from the Federal Government.

“(f) Regulations—The Secretary may prescribe such regulations and other guidance as may be necessary or appropriate to carry out this section.

“(g) Termination—No credit shall be allowed under this section for any taxable year beginning after December 31, 2027.”

“(C) Special rule for financial guaranty insurance companies

“(i) In general—Notwithstanding subparagraphs (A)(ii) and (B), the applicable insurance liabilities of a financial guaranty insurance company shall include its unearned premium reserves if—

“(I) such company is prohibited under generally accepted accounting principles from reporting on its applicable financial statements reserves for losses and loss adjustment expenses with respect to a financial guaranty insurance or reinsurance contract except to the extent that such reserve amounts are expected to exceed the unearned premium reserves on the contract,

“(II) the applicable financial statement of such company reports financial guaranty exposure of at least 15-to-1, and

“(III) such company includes in its insurance liabilities only its unearned premium reserves relating to insurance written or assumed that is within the single risk limits set forth in subsection (D) of section 4 of the Financial Guaranty Insurance Guideline (modified by using total shareholder’s equity as reported on the applicable financial statement of the company rather than aggregate of the surplus to policyholders and contingency reserves).

“(ii) Financial guaranty insurance company—For purposes of this subparagraph, the term “financial guaranty insurance company” means any insurance company the sole business of which is writing or reinsuring financial guaranty insurance (as defined in subsection (A) of section 1 of the Financial Guaranty Insurance Guideline) which is permitted under subsection (B) of section 4 of such Guideline.

“(iii) Financial guaranty exposure—For purposes of this subparagraph, the term “financial guaranty exposure” means the ratio of—

“(I) the net debt service outstanding insured or reinsured by the company that is within the single risk limits set forth in the Financial Guaranty Insurance Guideline (as reported on such company’s applicable financial statement), to

“(II) the company’s total assets (as so reported).

“(iv) Financial Guaranty Insurance Guideline—For purposes of this subparagraph—

“(I) In general—The term “Financial Guaranty Insurance Guideline” means the October 2008 model regulation that was adopted by the National Association of Insurance Commissioners on December 4, 2007.

“(II) Determinations made by Secretary—The determination of whether any provision of the Financial Guaranty Insurance Guideline has been satisfied shall be made by the Secretary.”

“(C) Clarification that certain items on applicable financial statement be separately reported with respect to corporation—An amount described in paragraph (1)(B) or clause (i)(II), (i)(III), (iii)(I), or (iii)(II) of paragraph (3)(C) shall not be treated as reported on an applicable financial statement for purposes of this section unless such amount is separately reported on such statement with respect to the corporation referred to in paragraph (1).

“(D) Authority of Secretary to require reporting

“(i) In general—Each United States person who owns an interest in a specified non-publicly traded foreign corporation and who takes the position that such corporation is not a passive foreign investment company shall report to the Secretary such information with respect to such corporation as the Secretary may require.

“(ii) Specified non-publicly traded foreign corporation—For purposes of this subparagraph, the term “specified non-publicly traded foreign corporation” means any foreign corporation—

“(I) which would be a passive foreign investment company if subsection (b)(2)(B) did not apply, and

“(II) no interest in which is traded on an established securities market.”

“418A. Infrastructure grants to improve child care safety

“(a) Short title—This section may be cited as the “Infrastructure Grants To Improve Child Care Safety Act of 2020”.

“(b) Needs Assessments

“(1) Immediate needs assessment

“(A) In general—The Secretary shall conduct an immediate needs assessment of the condition of child care facilities throughout the United States (with priority given to child care facilities that receive Federal funds), that—

“(i) determines the extent to which the COVID–19 pandemic has created immediate infrastructure needs, including infrastructure-related health and safety needs, which must be addressed for child care facilities to operate in compliance with public health guidelines;

“(ii) considers the effects of the pandemic on a variety of child care centers, including home-based centers; and

“(iii) considers how the pandemic has impacted specific metrics, such as—

“(I) capacity;

“(II) investments in infrastructure changes;

“(III) the types of infrastructure changes centers need to implement and their associated costs;

“(IV) the price of tuition; and

“(V) any changes or anticipated changes in the number and demographic of children attending.

“(B) Timing—The immediate needs assessment should occur simultaneously with the first grant-making cycle under subsection (c).

“(C) Report—Not later than 1 year after the date of the enactment of this section, the Secretary shall submit to the Congress a report containing the result of the needs assessment conducted under subparagraph (A), and make the assessment publicly available.

“(2) Long-term needs assessment

“(A) In general—The Secretary shall conduct a long-term assessment of the condition of child care facilities throughout the United States (with priority given to child care facilities that receive Federal funds). The assessment may be conducted through representative random sampling.

“(B) Report—Not later than 4 years after the date of the enactment of this section, the Secretary shall submit to the Congress a report containing the results of the needs assessment conducted under subparagraph (A), and make the assessment publicly available.

“(c) Child care facilities grants

“(1) Grants to States

“(A) In general—The Secretary may award grants to States for the purpose of acquiring, constructing, renovating, or improving child care facilities, including adapting, reconfiguring, or expanding facilities to respond to the COVID–19 pandemic.

“(B) Prioritized facilities—The Secretary may not award a grant to a State under subparagraph (A) unless the State involved agrees, with respect to the use of grant funds, to prioritize—

“(i) child care facilities primarily serving low-income populations;

“(ii) child care facilities primarily serving children who have not attained the age of 5 years;

“(iii) child care facilities that closed during the COVID–19 pandemic and are unable to open without making modifications to the facility that would otherwise be required to ensure the health and safety of children and staff; and

“(iv) child care facilities that serve the children of parents classified as essential workers during the COVID–19 pandemic.

“(C) Duration of grants—A grant under this subsection shall be awarded for a period of not more than 5 years.

“(D) Application—To seek a grant under this subsection, a State shall submit to the Secretary an application at such time, in such manner, and containing such information as the Secretary may require, which information shall—

“(i) be disaggregated as the Secretary may require; and

“(ii) include a plan to use a portion of the grant funds to report back to the Secretary on the impact of using the grant funds to improve child care facilities.

“(E) Priority—In selecting States for grants under this subsection, the Secretary shall prioritize States that—

“(i) plan to improve center-based and home-based child care programs, which may include a combination of child care and early Head Start or Head Start programs;

“(ii) aim to meet specific needs across urban, suburban, or rural areas as determined by the State; and

“(iii) show evidence of collaboration with—

“(I) local government officials;

“(II) other State agencies;

“(III) nongovernmental organizations, such as—

“(aa) organizations within the philanthropic community;

“(bb) certified community development financial institutions as defined in section 103 of the Community Development Banking and Financial Institutions Act of 1994 (12 U.S.C. 4702) that have been certified by the Community Development Financial Institutions Fund (12 U.S.C. 4703); and

“(cc) organizations that have demonstrated experience in—

“(AA) providing technical or financial assistance for the acquisition, construction, renovation, or improvement of child care facilities;

“(BB) providing technical, financial, or managerial assistance to child care providers; and

“(CC) securing private sources of capital financing for child care facilities or other low-income community development projects; and

“(IV) local community organizations, such as—

“(aa) child care providers;

“(bb) community care agencies;

“(cc) resource and referral agencies; and

“(dd) unions.

“(F) Consideration—In selecting States for grants under this subsection, the Secretary shall consider—

“(i) whether the applicant—

“(I) has or is developing a plan to address child care facility needs; and

“(II) demonstrates the capacity to execute such a plan; and

“(ii) after the date the report required by subsection (b)(1)(C) is submitted to the Congress, the needs of the applicants based on the results of the assessment.

“(G) Diversity of awards—In awarding grants under this section, the Secretary shall give equal consideration to States with varying capacities under subparagraph (F).

“(H) Matching requirement

“(i) In general—As a condition for the receipt of a grant under subparagraph (A), a State that is not an Indian tribe shall agree to make available (directly or through donations from public or private entities) contributions with respect to the cost of the activities to be carried out pursuant to subparagraph (A), which may be provided in cash or in kind, in an amount equal to 10 percent of the funds provided through the grant.

“(ii) Determination of amount contributed—Contributions required by clause (i) may include—

“(I) amounts provided by the Federal Government, or services assisted or subsidized to any significant extent by the Federal Government; or

“(II) philanthropic or private-sector funds.

“(I) Report—Not later than 6 months after the last day of the grant period, a State receiving a grant under this paragraph shall submit a report to the Secretary as described in subparagraph (D)—

“(i) to determine the effects of the grant in constructing, renovating, or improving child care facilities, including any changes in response to the COVID–19 pandemic and any effects on access to and quality of child care; and

“(ii) to provide such other information as the Secretary may require.

“(J) Amount limit—The annual amount of a grant under this paragraph may not exceed $35,000,000.

“(2) Grants to intermediary organizations

“(A) In general—The Secretary may award grants to intermediary organizations, such as certified community development financial institutions, tribal organizations, or other organizations with demonstrated experience in child care facilities financing, for the purpose of providing technical assistance, capacity building, and financial products to develop or finance child care facilities.

“(B) Application—A grant under this paragraph may be made only to intermediary organizations that submit to the Secretary an application at such time, in such manner, and containing such information as the Secretary may require.

“(C) Priority—In selecting intermediary organizations for grants under this subsection, the Secretary shall prioritize intermediary organizations that—

“(i) demonstrate experience in child care facility financing or related community facility financing;

“(ii) demonstrate the capacity to assist States and local governments in developing child care facilities and programs;

“(iii) demonstrate the ability to leverage grant funding to support financing tools to build the capacity of child care providers, such as through credit enhancements;

“(iv) propose to meet a diversity of needs across States and across urban, suburban, and rural areas at varying types of center-based, home-based, and other child care settings, including early care programs located in freestanding buildings or in mixed-use properties; and

“(v) propose to focus on child care facilities primarily serving low-income populations and children who have not attained the age of 5 years.

“(D) Amount limit—The amount of a grant under this paragraph may not exceed $10,000,000.

“(3) Labor standards for all grants—The Secretary shall require that each entity, including grantees and subgrantees, that applies for an infrastructure grant for constructing, renovating, or improving child care facilities, including adapting, reconfiguring, or expanding such facilities, which is funded in whole or in part under this section, shall include in its application written assurance that all laborers and mechanics employed by contractors or subcontractors in the performance of construction, alternation or repair, as part of such project, shall be paid wages at rates not less than those prevailing on similar work in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of part A of subtitle II of title 40, United States Code (commonly referred to as the “Davis-Bacon Act”), and with respect to the labor standards specified in such subchapter the Secretary of Labor shall have the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (15 Fed. Reg. 3176; 5 U.S.C. App.) and section 2 of the Act of June 13, 1934 (40 U.S.C. 276c).

“(4) Report—Not later than the end of fiscal year 2024, the Secretary shall submit to the Congress a report on the effects of the grants provided under this subsection, and make the report publically accessible.

“(d) Limitations on authorization of appropriations

“(1) In general—To carry out this section, there is authorized to be appropriated $10,000,000,000 for fiscal year 2020, which shall remain available through fiscal year 2024.

“(2) Reservations of funds

“(A) Indian tribes—The Secretary shall reserve 3 percent of the total amount made available to carry out this section, for payments to Indian tribes.

“(B) Territories—The Secretary shall reserve 3 percent of the total amount made available to carry out this section, for payments to territories.

“(3) Grants for intermediary organizations—Not less than 10 percent and not more than 15 percent of the total amount made available to carry out this section may be used to carry out subsection (c)(2).

“(4) Limitation on use of funds for needs assessments—Not more than $5,000,000 of the amounts made available to carry out this section may be used to carry out subsection (b).

“(5) Labor standards for all grants—The Secretary of Health and Human Services shall require that each entity, including grantees and subgrantees, that applies for an infrastructure grant for constructing, renovating, or improving child care facilities, including adapting, reconfiguring, or expanding such facilities, which is funded in whole or in part under this section, shall include in its application written assurance that all laborers and mechanics employed by contractors or subcontractors in the performance of construction, alternation or repair, as part of such project, shall be paid wages at rates not less than those prevailing on similar work in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of part A of subtitle II of title 40, United States Code (commonly referred to as the “Davis-Bacon Act”), and with respect to the labor standards specified in such subchapter the Secretary of Labor shall have the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (15 Fed. Reg. 3176; 5 U.S.C. App.) and section 2 of the Act of June 13, 1934 (40 U.S.C. 276c).

“(e) Definition of State—In this section, the term “State” has the meaning provided in section 419, except that it includes the Commonwealth of the Northern Mariana Islands and any Indian tribe.”

“6431. Elective payment for energy property, electricity produced from certain renewable resources, etc, and carbon oxide sequestration

“(a) Energy property—In the case of a taxpayer making an election (at such time and in such manner as the Secretary may provide) under this section with respect to any portion of an applicable credit, such taxpayer shall be treated as making a payment against the tax imposed by subtitle A for the taxable year equal to—

“(1) in the case of an Indian tribal government, the amount of such portion, and

“(2) in the case of any other taxpayer, 85 percent of such amount.

“(b) Definitions and special rules—For purposes of this section—

“(1) Governmental entities treated as taxpayers—In the case of an election under this section—

“(A) any State or local government, or a political subdivision thereof, or

“(B) an Indian tribal government,

“(2) Applicable credit—The term “applicable credit” means each of the following credits that would (without regard to this section) be determined with respect to the taxpayer:

“(A) A energy credit under section 48.

“(B) A renewable electricity production credit under section 45.

“(C) A carbon oxide sequestration credit under section 45Q.

“(3) Indian tribal government—The term “Indian tribal government” shall have the meaning given such term by section 139E.

“(4) Timing—The payment described in subparagraph (A) shall be treated as made on—

“(A) in the case of any government, or political subdivision, to which paragraph (1) applies and for which no return is required under section 6011 or 6033(a), the later of the date that a return would be due under section 6033(a) if such government or subdivision were described in that section or the date on which such government or subdivision submits a claim for credit or refund (at such time and in such manner as the Secretary shall provide), and

“(B) in any other case, the later of the due date of the return of tax for the taxable year or the date on which such return is filed.

“(5) Waiver of special rules—In the case of an election under this section, the determination of any applicable credit shall be without regard to paragraphs (3) and (4)(A)(i) of section 50(b).

“(c) Exclusion from gross income—Gross income of the taxpayer shall be determined without regard to this section.

“(d) Denial of double benefit—Solely for purposes of section 38, in the case of a taxpayer making an election under this section, the energy credit determined under section 45 or the renewable electricity production credit determined under section 48 shall be reduced by the amount of the portion of such credit with respect to which the taxpayer makes such election.”

“(F) Qualified offshore wind facilities

“(i) In general—In the case of any qualified offshore wind facility—

“(I) subparagraph (C)(ii) shall be applied by substituting “January 1 of the applicable year (as determined under subparagraph (F)(ii))” for “January 1, 2026”,

“(II) subparagraph (E) shall not apply, and

“(III) for purposes of this paragraph, section 45(d)(1) shall be applied by substituting “January 1 of the applicable year (as determined under section 48(a)(5)(F)(ii))”’ for “January 1, 2026”.

“(ii) Applicable year—For purposes of this subparagraph, the term “applicable year” means the later of—

“(I) calendar year 2025, or

“(II) the calendar year subsequent to the first calendar year in which the Secretary, after consultation with the Secretary of Energy, determines that the United States has increased its offshore wind capacity by not less than 3,000 megawatts as compared to such capacity on January 1, 2021.

“(iii) Qualified offshore wind facility—For purposes of this subparagraph, the term “qualified offshore wind facility” means a qualified facility (within the meaning of section 45) described in paragraph (1) of section 45(d) (determined without regard to any date by which the construction of the facility is required to begin) which is located in the inland navigable waters of the United States or in the coastal waters of the United States.

“(iv) Report on offshore wind capacity—On January 15, 2024, and annually thereafter until the calendar year described in clause (ii)(II), the Secretary, after consultation with the Secretary of Energy, shall issue a report to be made available to the public which discloses the increase in the offshore wind capacity of the United States, as measured in total megawatts, since January 1, 2020.”

“(g) Phase out; termination

“(1) Phase out—In the case of any sale or use after December 31, 2022, subsections (b)(1)(A) and (b)(2)(A) shall be applied by substituting for “$1.00”—

“(A) “$.75”, if such sale or use is before January 1, 2024,

“(B) “$.50”, if such sale or use is after December 31, 2023, and before January 1, 2025, and

“(C) “$.33”, if such sale or use is after December 31, 2024, and before January 1, 2026.

“(2) Termination—This section shall not apply to any sale or use after December 31, 2025.”

“(2) Limitation on qualified energy efficiency improvements—The credit allowed under this section by reason of subsection (a)(1), with respect to costs paid or incurred by a taxpayer for a taxable year, shall not exceed—

“(A) for components described in subsection (c)(3)(A), the excess (if any) of $600 over the aggregate credits allowed under this section with respect to such components for all prior taxable years ending after December 31, 2020,

“(B) for components described in subsection (c)(3)(B)—

“(i) in the case of components which are not described in clause (ii), the excess (if any) of $200 over the aggregate credits allowed under this section with respect to such components for all prior taxable years ending after December 31, 2020, and

“(ii) in the case of components which meet the standards for most efficient certification under applicable Energy Star program requirements, the excess (if any) of $600 over the aggregate credits allowed under this section with respect to such components for all prior taxable years ending after December 31, 2020, or with respect to components described in clause (i) for such taxable year, and

“(C) for components described in subsection (c)(3)(C) by any taxpayer for any taxable year, the credit allowed under this section with respect to such amounts for such year shall not exceed the lesser of—

“(i) the excess (if any) of $500 over the aggregate credits allowed under this section with respect to such amounts for all prior taxable years ending after December 31, 2020, or

“(ii) $250 for each exterior door.

“(3) Limitation on residential energy property expenditures—The credit allowed under this section by reason of subsection (a)(2) shall not, with respect to an item of property, exceed—

“(A) in the case of property described in subparagraph (A), (B), or (C) of subsection (d)(3), $600,

“(B) for the case of property described in subparagraph (D) of subsection (d)(3), $400,

“(C) in the case of a hot water boiler, $600, and

“(D) in the case of a furnace, an amount equal to the sum of—

“(i) $300, plus

“(ii) if the taxpayer is converting from a non-condensing furnace to a condensing furnace, $300.”

“(A) in the case of an exterior window, a skylight, or an exterior door, applicable Energy Star program requirements, and

“(B) in the case of any other component, the prescriptive criteria for such component established by the 2018 IECC (as such term is defined in section 45L(b)(5)).”

“(A) in the case of a furnace, 97 percent, and

“(B) in the case of a hot water boiler, 95 percent.”

“(e) Limitation on number of new qualified plug-In electric drive motor vehicles eligible for credit

“(1) In general—In the case of any new qualified plug-in electric drive motor vehicle sold after the date of the enactment of the GREEN Act of 2020—

“(A) if such vehicle is sold during the transition period, the amount determined under subsection (b)(2) shall be reduced by $500, and

“(B) if such vehicle is sold during the phaseout period, only the applicable percentage of the credit otherwise allowable under subsection (a) shall be allowed.

“(2) Transition period—For purposes of this subsection, the transition period is the period subsequent to the first date on which the number of new qualified plug-in electric drive motor vehicles manufactured by the manufacturer of the vehicle referred to in paragraph (1) sold for use in the United States after December 31, 2009, is at least 200,000.

“(3) Phaseout period

“(A) In general—For purposes of this subsection, the phaseout period is the period beginning with the second calendar quarter following the calendar quarter which includes the first date on which the number of new qualified plug-in electric drive motor vehicles manufactured by the manufacturer of the vehicle referred to in paragraph (1) sold for use in the United States after December 31, 2009, is at least 600,000.

“(B) Applicable percentage—For purposes of paragraph (1)(B), the applicable percentage is—

“(i) 50 percent for the first calendar quarter of the phaseout period, and

“(ii) 0 percent for each calendar quarter thereafter.

“(C) Exclusion of sale of certain vehicles

“(i) In general—For purposes of subparagraph (A), any new qualified plug-in electric drive motor vehicle manufactured by the manufacturer of the vehicle referred to in paragraph (1) which was sold during the exclusion period shall not be included for purposes of determining the number of such vehicles sold.

“(ii) Exclusion period—For purposes of this subparagraph, the exclusion period is the period—

“(I) beginning on the first date on which the number of new qualified plug-in electric drive motor vehicles manufactured by the manufacturer of the vehicle referred to in paragraph (1) sold for use in the United States after December 31, 2009, is at least 200,000, and

“(II) ending on the date of the enactment of the GREEN Act of 2020.

“(4) Controlled groups—Rules similar to the rules of section 30B(f)(4) shall apply for purposes of this subsection.”

“(E) is acquired after December 31, 2020, and before January 1, 2026.”

“25E. Previously-owned qualified plug-in electric drive motor vehicles

“(a) Allowance of credit—In the case of a qualified buyer who during a taxable year places in service a previously-owned qualified plug-in electric drive motor vehicle, 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—

“(1) $1,250, plus

“(2) in the case of a vehicle which draws propulsion energy from a battery which exceeds 4 kilowatt hours of capacity (determined at the time of sale), the lesser of—

“(A) $1,250, and

“(B) the product of $208.50 and such excess kilowatt hours.

“(b) Limitations

“(1) Sale price—The credit allowed under subsection (a) with respect to sale of a vehicle shall not exceed 30 percent of the sale price.

“(2) Adjusted gross income—The amount which would (but for this paragraph) be allowed as a credit under subsection (a) shall be reduced (but not below zero) by $250 for each $1,000 (or fraction thereof) by which the taxpayer’s adjusted gross income exceeds $30,000 (twice such amount in the case of a joint return).

“(c) Definitions—For purposes of this section—

“(1) Previously-owned qualified plug-in electric drive motor vehicle—The term “previously-owned qualified plug-in electric drive motor vehicle” means, with respect to a taxpayer, a motor vehicle—

“(A) the model year of which is at least 2 earlier than the calendar year in which the taxpayer acquires such vehicle,

“(B) the original use of which commences with a person other than the taxpayer,

“(C) which is acquired by the taxpayer in a qualified sale,

“(D) registered by the taxpayer for operation in a State or possession of the United States, and

“(E) which meets the requirements of subparagraphs (C), (D), (E), and (F) of section 30D(d)(1).

“(2) Qualified sale—The term “qualified sale” means a sale of a motor vehicle—

“(A) by a person who holds such vehicle in inventory (within the meaning of section 471) for sale or lease,

“(B) for a sale price of less than $25,000, and

“(C) which is the first transfer since the date of the enactment of this section to a person other than the person with whom the original use of such vehicle commenced.

“(3) Qualified buyer—The term “qualified buyer” means, with respect to a sale of a motor vehicle, a taxpayer—

“(A) who is an individual,

“(B) who purchases such vehicle for use and not for resale,

“(C) with respect to whom no deduction is allowable with respect to another taxpayer under section 151,

“(D) who has not been allowed a credit under this section for any sale during the 3-year period ending on the date of the sale of such vehicle, and

“(E) who possesses a certificate issued by the seller that certifies—

“(i) that the vehicle is a previously-owned qualified plug-in electric drive motor vehicle,

“(ii) the capacity of the battery at time of sale, and

“(iii) such other information as the Secretary may require.

“(4) Motor vehicle; capacity—The terms “motor vehicle” and “capacity” have the meaning given such terms in paragraphs (2) and (4) of section 30D(d), respectively.

“(d) Application of certain rules—For purposes of this section, rules similar to the rules of paragraphs (1), (2), (4), (5), (6) and (7) of section 30D(f) shall apply for purposes of this section.

“(e) Certificate submission requirement—The Secretary may require that the issuer of the certificate described in subsection (c)(3)(E) submit such certificate to the Secretary at the time and in the manner required by the Secretary.

“(f) Termination—No credit shall be allowed under this section with respect to sales after December 31, 2025.”

“45U. Zero-emission heavy vehicle credit

“(a) Allowance of credit—For purposes of section 38, in the case of a manufacturer of a zero-emission heavy vehicle, the zero-emission heavy vehicle credit determined under this section for a taxable year is an amount equal to 10 percent of the sum of the sale price of each zero-emission heavy vehicle sold by such taxpayer during such taxable year.

“(b) Limitation—The sale price of a zero-emission heavy vehicle may not be taken into account under subsection (a) to the extent such price exceeds $1,000,000.

“(c) Zero-Emission heavy vehicle—For purposes of this section—

“(1) In general—The term “zero-emission heavy vehicle” means a motor vehicle which—

“(A) has a gross vehicle weight rating of not less than 14,000 pounds,

“(B) is not powered or charged by an internal combustion engine, and

“(C) is propelled solely by an electric motor which draws electricity from a battery or fuel cell.

“(2) Motor vehicle; manufacturer—The term “motor vehicle” and “manufacturer” have the meaning given such terms in paragraphs (2) and (3) of section 30D(d), respectively.

“(d) Special rules

“(1) Sale price—For purposes of this section, the sale price of a zero-emission heavy vehicle shall be reduced by any rebate or other incentive given before, on, or after the date of the sale.

“(2) Domestic use—No credit shall be allowed under subsection (a) with respect to a zero-emission heavy vehicle to a manufacturer who knows or has reason to know that such vehicle will not be used primarily in the United States or a possession of the United States.

“(3) Regulations—The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section.

“(e) Termination—This section shall not apply to sales after December 31, 2025.”

“(34) the zero-emission heavy vehicle credit determined under section 45U.”

“(v) Low-speed electric bicycles—The term “bicycle” includes a two- or three-wheeled vehicle with fully operable pedals and an electric motor of less than 750 watts (1 h.p.), whose maximum speed on a paved level surface, when powered solely by such a motor while ridden by an operator who weighs 170 pounds, is less than 20 mph.”

“(iii) Qualified bicycle commuting month—The term qualified bicycle commuting month means, with respect to any employee, any month during which such employee regularly uses a bicycle for a portion of the travel between the employee’s residence and place of employment.”

“(e) Additional allocations

“(1) In general—Not later than 180 days after the date of enactment of this paragraph, the Secretary, after consultation with the Secretary of Energy, shall establish a program to designate amounts of qualifying advanced project credit limitation to qualifying advanced energy projects.

“(2) Annual limitation

“(A) In general—The amount of qualifying advanced project credit limitation that may be designated under this subsection during any calendar year shall not exceed the annual credit limitation with respect to such year.

“(B) Annual credit limitation—For purposes of this subsection, the term “annual credit limitation” means $2,500,000,000 for each of calendar years 2021, 2022, 2023, 2024, and 2025, and zero thereafter.

“(C) Carryover of unused limitation—If the annual credit limitation for any calendar year exceeds the aggregate amount designated for such year under this subsection, such limitation for the succeeding calendar year shall be increased by the amount of such excess. No amount may be carried under the preceding sentence to any calendar year after 2025.

“(3) Placed in service deadline—No credit shall be determined under subsection (a) with respect to any property which is placed in service after the date that is 4 years after the date of the designation under this subsection relating to such property.

“(4) Selection criteria—Selection criteria similar to those in subsection (d)(3) shall apply, except that in determining designations under this subsection, the Secretary, after consultation with the Secretary of Energy, shall—

“(A) require that applicants provide written assurances to the Secretary that all laborers and mechanics employed by contractors and subcontractors in the performance of construction, alteration or repair work on a qualifying advanced energy project shall be paid wages at rates not less than those prevailing on projects of a similar character in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code, and

“(B) give the highest priority to projects which—

“(i) manufacture (other than primarily assembly of components) property described in a subclause of subsection (c)(1)(A)(i) (or components thereof), and

“(ii) have the greatest potential for commercial deployment of new applications.

“(5) Disclosure of designations—Rules similar to the rules of subsection (d)(5) shall apply for purposes of this subsection.”

“45V. Labor costs of installing mechanical insulation property

“(a) In general—For purposes of section 38, the mechanical insulation labor costs credit determined under this section for any taxable year is an amount equal to 10 percent of the mechanical insulation labor costs paid or incurred by the taxpayer during such taxable year.

“(b) Mechanical insulation labor costs—For purposes of this section—

“(1) In general—The term “mechanical insulation labor costs” means the labor cost of installing mechanical insulation property with respect to a mechanical system referred to in paragraph (2)(A) which was originally placed in service not less than 1 year before the date on which such mechanical insulation property is installed.

“(2) Mechanical insulation property—The term “mechanical insulation property” means insulation materials, and facings and accessory products installed in connection to such insulation materials—

“(A) placed in service in connection with a mechanical system which—

“(i) is located in the United States, and

“(ii) is of a character subject to an allowance for depreciation, and

“(B) which result in a reduction in energy loss from the mechanical system which is greater than the expected reduction from the installation of insulation materials which meet the minimum requirements of Reference Standard 90.1 (as defined in section 179D(c)(2)).

“(c) Termination—This section shall not apply to mechanical insulation labor costs paid or incurred after December 31, 2025.”

“(35) the mechanical insulation labor costs credit determined under section 45V(a).”

“36C. Qualified environmental justice programs

“(a) Allowance of credit—In the case of an eligible educational institution, there shall be allowed as a credit against the tax imposed by this subtitle for any taxable year an amount equal to the applicable percentage of the amounts paid or incurred by such taxpayer during such taxable year which are necessary for a qualified environmental justice program.

“(b) Qualified environmental justice program—For purposes of this section—

“(1) In general—The term “qualified environmental justice program” means a program conducted by one or more eligible educational institutions that is designed to address, or improve data about, qualified environmental stressors for the primary purpose of improving, or facilitating the improvement of, health and economic outcomes of individuals residing in low-income areas or areas populated disproportionately by racial or ethnic minorities.

“(2) Qualified environmental stressor—The term “qualified environmental stressor” means, with respect to an area, a contamination of the air, water, soil, or food with respect to such area or a change relative to historical norms of the weather conditions of such area.

“(c) Eligible educational institution—For purposes of this section, the term “eligible educational institution” means an institution of higher education (as such term is defined in section 101 or 102(c) of the Higher Education Act of 1965) that is eligible to participate in a program under title IV of such Act.

“(d) Applicable percentage—For purposes of this section, the term “applicable percentage” means—

“(1) in the case of a program involving material participation of faculty and students of an institution described in section 371(a) of the Higher Education Act of 1965, 30 percent, and

“(2) in all other cases, 20 percent.

“(e) Credit allocation

“(1) Allocation

“(A) In general—The Secretary shall allocate credit dollar amounts under this section to eligible educational institutions, for qualified environmental justice programs, that—

“(i) submit applications at such time and in such manner as the Secretary may provide, and

“(ii) are selected by the Secretary under subparagraph (B).

“(B) Selection criteria—The Secretary, after consultation with the Secretary of Energy, the Secretary of Education, the Secretary of Health and Human Services, and the Administrator of the Environmental Protection Agency, shall select applications on the basis of the following criteria:

“(i) The extent of participation of faculty and students of an institution described in section 371(a) of the Higher Education Act of 1965.

“(ii) The extent of the expected effect on the health or economic outcomes of individuals residing in areas within the United States that are low-income areas or areas populated disproportionately by racial or ethnic minorities.

“(iii) The creation or significant expansion of qualified environmental justice programs.

“(2) Limitations

“(A) In general—The amount of the credit determined under this section for any taxable year to any eligible educational institution for any qualified environmental justice program shall not exceed the excess of—

“(i) the credit dollar amount allocated to such institution for such program under this subsection, over

“(ii) the credits previously claimed by such institution for such program under this section.

“(B) Five-year limitation—No amounts paid or incurred after the 5-year period beginning on the date a credit dollar amount is allocated to an eligible educational institution for a qualified environmental justice program shall be taken into account under subsection (a) with respect to such institution for such program.

“(C) Allocation limitation—The total amount of credits that may be allocated under the program shall not exceed—

“(i) $1,000,000,000 for each of 2021, 2022, 2023, 2024, and 2025, and

“(ii) $0 for each subsequent year.

“(f) Requirements

“(1) In general—An eligible educational institution that has been allocated credit dollar amounts under this section for a qualified environmental justice project for a taxable year shall—

“(A) make publicly available the application submitted to the Secretary under subsection (e) with respect to such project, and

“(B) submit an annual report to the Secretary that describes the amounts paid or incurred for, and expected impact of, such project.

“(2) Failure to comply—In the case of an eligible educations institution that has failed to comply with the requirements of this subsection, the credit dollar amount allocated to such institution under this section is deemed to be $0.

“(g) Public disclosure—The Secretary, upon making an allocation of credit dollar amounts under this section, shall publicly disclose—

“(1) the identity of the eligible educational institution receiving the allocation, and

“(2) the amount of such allocation.”

“(C) Increase in credit for projects designated to serve extremely low-income households—In the case of any building—

“(i) 20 percent or more of the residential units in which are rent-restricted (determined as if the imputed income limitation applicable to such units were 30 percent of area median gross income) and are designated by the taxpayer for occupancy by households the aggregate household income of which does not exceed the greater of—

“(I) 30 percent of area median gross income, or

“(II) 100 percent of an amount equal to the Federal poverty line (within the meaning of section 36B(d)(3)), and

“(ii) which is designated by the housing credit agency as requiring the increase in credit under this subparagraph in order for such building to be financially feasible as part of a qualified low-income housing project,”

“(II) Indian area—For purposes of subclause (I), the term Indian area means any Indian area (as defined in section 4(11) of the Native American Housing Assistance and Self Determination Act of 1996 (25 U.S.C. 4103(11))).

“(III) Special rule for buildings in Indian areas—In the case of an area which is a difficult development area solely because it is an Indian area, a building shall not be treated as located in such area unless such building is assisted or financed under the Native American Housing Assistance and Self Determination Act of 1996 (25 U.S.C. 4101 et seq.) or the project sponsor is an Indian tribe (as defined in section 45A(c)(6)), a tribally designated housing entity (as defined in section 4(22) of such Act (25 U.S.C. 4103(22))), or wholly owned or controlled by such an Indian tribe or tribally designated housing entity.”

“(IV) Rural area—For purposes of subclause (I), the term rural area means any non-metropolitan area, or any rural area as defined by section 520 of the Housing Act of 1949, which is identified by the qualified allocation plan under subsection (m)(1)(B).”

“42A. Credit for contributions to low-income housing supportive services

“(a) In general—For purposes of section 38, the amount of the low-income housing supportive services credit determined under this section for the applicable taxable year is an amount equal to 25 percent of the qualified supportive housing contribution made by the taxpayer.

“(b) Qualified supportive housing contribution—For purposes of this section—

“(1) In general—The term qualified supportive housing contribution means the total amount contributed in cash by the taxpayer to a qualified supportive housing reserve fund with respect to a qualified low-income building, determined as of the date the building is placed in service.

“(2) Qualified supportive housing reserve fund—The term qualified supportive housing reserve fund means, with respect to any qualified low-income building, a separate fund reserved exclusively for payment for qualified supportive services provided to tenants of the building pursuant to an extended supportive services commitment. The owner of such building shall designate an administrator to separately account for the amounts in the fund in such manner as the Secretary may prescribe.

“(3) Limitations

“(A) In general—No amount attributable to any governmental grant, including grants provided by the government of any State, possession, tribe, or locality, shall be taken into account under paragraph (1).

“(B) Dollar limitation—The total qualified supportive housing contributions taken into account under this section with respect to any qualified low-income building shall not exceed—

“(i) $120,000, multiplied by

“(ii) the number of low-income units in the building which are occupied at the close of the applicable taxable year.

“(c) Applicable taxable year—For purposes of this section, the term applicable taxable year means the 1st taxable year in the credit period with respect to the qualified low-income building described in subsection (b)(1).

“(d) Qualified supportive services—For purposes of this section, the term qualified supportive services means services—

“(1) provided by the owner of a qualified low-income building (directly or through contracts with a third party service provider) to tenants of the building,

“(2) which include health services (including mental health services), coordination of tenant benefits, job training, financial counseling, resident engagement services, or services the principal purpose of which is to help tenants retain permanent housing, or such other services as the Secretary may by regulation provide,

“(3) which are provided at no cost to tenants, and

“(4) usage of or participation in which is not required for tenants.

“(e) Extended supportive services commitment—The term extended supportive services commitment means any agreement between the owner of a qualified low-income building and the housing credit agency which—

“(1) requires that amounts in a qualified supportive housing reserve fund are spent exclusively on the provision of qualified supportive services to tenants of such building,

“(2) requires that the amounts in such fund be spent entirely during the extended use period, and provides for the manner in which such spending will be distributed across such period,

“(3) requires the designation of one or more individuals to engage tenants regarding and coordinate delivery of qualified supportive services,

“(4) requires the maintenance of an appropriate certification, as determined by the Secretary after consultation with housing credit agencies, for qualified supportive services, subject to recertification at least once every 5 years,

“(5) requires appropriate annual reporting to the housing credit agency on expenditures and outcomes, as determined by such agency, and

“(6) is binding on all successors in ownership of such building.

“(f) Recapture of qualified supportive housing reserve amounts

“(1) In general—If the owner of a qualified low-income building is determined to be noncompliant with the extended supportive services commitment or extended low-income housing commitment with respect to such building, any remaining amounts in the qualified supportive housing reserve fund with respect to such building shall be transferred to the housing credit agency.

“(2) Use of repayments—A housing credit agency shall use any amount received pursuant to paragraph (1) only for purposes of qualified low-income buildings.

“(g) Special rules

“(1) In general—Notwithstanding any other provision of this section, no credit shall be allowed under this section for any taxable year with respect to any qualified low-income building unless—

“(A) the building has received an allocation of the low-income housing credit under section 42 by a housing credit agency which is approved by the governmental unit (in accordance with rules similar to the rules of section 147(f)(2) (other than subparagraph (B)(ii) thereof)) of which such agency is a part,

“(B) the housing credit agency sets forth selection criteria to determine appropriate, evidence-based supportive services and provides a procedure that the agency (or an agent or other private contractor of such agency) will follow in monitoring for noncompliance with the provisions of this section and in reporting such noncompliance to the Secretary,

“(C) an extended low-income housing commitment is in effect with respect to such building as of the end of such taxable year,

“(D) an extended supportive services commitment is in effect with respect to such building as of the end of such taxable year, and

“(E) appropriate books and records for itemized expenses and expenditures with respect to the qualified supportive housing reserve fund are maintained on an annual basis, and are available for inspection upon request by the housing credit agency.

“(2) Denial of double benefit—The deductions otherwise allowed under this chapter for the taxable year shall be reduced by the amount of the credit allowed under this section for such taxable year.

“(h) Definitions—Any term used in this section which is also used in section 42 shall have the same meaning as when used in such section.”

“(B) the low-income housing supportive services credit determined under section 42A(a),”

“42B. Neighborhood homes credit

“(a) Allowance of credit—For purposes of section 38, the amount of the neighborhood homes credit determined under this section for a taxable year for a qualified project shall be, with respect to each qualified residence that is part of such qualified project and that experiences a qualified completion event during such taxable year, an amount equal to—

“(1) in the case of an affordable sale, with respect to the seller, the excess of—

“(A) the qualified development cost incurred by such seller for such qualified residence, over

“(B) the sale price of such qualified residence, or

“(2) in the case of any other qualified completion event, with respect to a taxpayer other than the owner of the qualified residence (or a related person with respect to such owner), the excess of—

“(A) the development cost incurred by such taxpayer for such qualified residence, over

“(B) the amount received by such taxpayer as payment for such rehabilitation.

“(b) Limitations

“(1) Amount—The amount determined under subsection (a) with respect to a qualified residence shall not exceed 35 percent of the lesser of—

“(A) the qualified development cost, or

“(B) 80 percent of the national median sale price for new homes (as determined pursuant to the most recent census data available as of the date on which the neighborhood homes credit agency makes an allocation for the qualified project).

“(2) Allocations

“(A) In general—The amount determined under subsection (a) with respect to a qualified residence that is part of a qualified project and that experiences a qualified completion event shall not exceed the excess of—

“(i) the amount determined under subparagraph (B), over

“(ii) the amounts previously determined under subsection (a) with respect to such qualified project.

“(B) Allocation amount—The amount determined under this paragraph with respect to a qualified residence that is part of a qualified project and that experiences a qualified completion event is the least of—

“(i) the amount allocated to such project by the neighborhood homes credit agency under this section,

“(ii) pursuant to subparagraph (C), the amount such agency determines at the time of the qualified completion event is necessary to ensure the financial feasibility of the project, or

“(iii) in the case of a qualified completion event that occurs after the 5-year period beginning on the date of the allocation referred to in clause (i), $0.

“(C) Financial feasability—For purposes of subparagraph (B)(ii), the neighborhood homes credit agency shall consider—

“(i) the sources and uses of funds and the total financing planned for the qualified project,

“(ii) any proceeds or receipts expected to be generated by reason of tax benefits,

“(iii) the percentage of the amount allocated to such project under this section used for project costs other than the cost of intermediaries, and

“(iv) the reasonableness of the developmental costs and fees of the qualified project.

“(c) Qualified development cost—For purposes of this section—

“(1) In general—The term qualified development cost means, with respect to a qualified residence, so much of the allowable development cost as the neighborhood homes credit agency certifies, at the time of the completion event, meets the standards promulgated under subsection (h)(1)(C).

“(2) Allowable development cost—The term allowable development cost means—

“(A) the cost of construction, substantial rehabilitation, demolition of any structure, and environmental remediation, and

“(B) in the case of an affordable sale, so much of the cost of acquiring buildings and land as does not exceed an amount equal to 75 percent of the costs described in subparagraph (A).

“(3) Condominium and cooperative housing units—In the case of a qualified residence described in subparagraph (B) or (C) of subsection (f)(1), the allowable development cost of such qualified residence shall be an amount equal to the total allowable development cost of the entire condominium or cooperative housing property in which such qualified residence is located, multiplied by a fraction—

“(A) the numerator of which is the total floor space of such qualified residence, and

“(B) the denominator of which is the total floor space of all residences within such property.

“(d) Qualified project—For purposes of this section, the term qualified project means a project that—

“(1) a neighborhood homes credit agency certifies will build or substantially rehabilitate one or more qualified residences located in one or more qualified census tracts, and

“(2) is designated by such agency as a qualified project under this section and is allocated (before such building or substantial rehabilitation begins) a portion of the amount allocated to such agency under subsection (g).

“(e) Qualified census tract—For purposes of this section—

“(1) In general—The term qualified census tract means a census tract—

“(A) with—

“(i) a median gross income which does not exceed 80 percent of the applicable area median gross income,

“(ii) a poverty rate that is not less than 130 percent of the applicable area poverty rate, and

“(iii) a median value for owner-occupied homes that does not exceed applicable area median value for owner-occupied homes,

“(B) which is located in a city with a population of not less than 50,000 and a poverty rate that is not less than 150 percent of the applicable area poverty rate, and which has—

“(i) a median gross income which does not exceed the applicable area median gross income, and

“(ii) a median value for owner-occupied homes that does not exceed 80 percent of the applicable area median value for owner-occupied homes, or

“(C) which is located in a nonmetropolitan county and which has—

“(i) a median gross income which does not exceed the applicable area median gross income, and

“(ii) been designated by a neighborhood homes credit agency under this clause.

“(2) Additional census tracts for substantial rehabilitation—In the case of a qualified residence that is intended for substantial rehabilitation described in subsection (f)(5)(B), the term qualified census tract includes a census tract that meets the requirements of paragraph (1)(A), without regard to clause (iii), and that is designated by the neighborhood homes credit agency under this paragraph.

“(3) List of qualified census tracts—The Secretary of Housing and Urban Development shall, for each year, make publicly available a list of qualified census tracts under—

“(A) on a combined basis, subparagraphs (A) and (B) of paragraph (1),

“(B) subparagraph (C) of such paragraph, and

“(C) paragraph (2).

“(f) Other definitions—For purposes of this section—

“(1) Qualified residence—The term qualified residence means a residence that consists of—

“(A) a single-family home containing 4 or fewer residential units,

“(B) a condominium unit, or

“(C) a house or an apartment owned by a cooperative housing corporation (as defined in section 216(b)).

“(2) Affordable sale

“(A) In general

“(i) In general—The term affordable sale means a sale to a qualified homeowner of a qualified residence that the neighborhood homes credit agency certifies as meeting the standards promulgated under subsection (h)(1)(D) for a price that does not exceed—

“(I) in the case of any qualified residence not described in subclause (II), (III), or (IV), the amount equal to the product of 4 multiplied by the applicable area median gross income,

“(II) in the case of a single-family home containing two residential units, 125 percent of the amount described in subclause (I),

“(III) in the case of a single-family home containing three residential units, 150 percent of the amount described in subclause (I), or

“(IV) in the case of a single-family home containing four residential units, 175 percent of the amount described in subclause (I).

“(ii) Related persons

“(I) In general—A sale between related persons shall not be treated as an affordable sale.

“(II) Definition—For purposes of this section, a person (in this clause referred to as the “related person”) is related to any person if the related person bears a relationship to such person specified in section 267(b) or 707(b)(1), or the related person and such person are engaged in trades or businesses under common control (within the meaning of subsections (a) and (b) of section 52). For purposes of the preceding sentence, in applying section 267(b) or 707(b)(1), “10 percent” shall be substituted for “50 percent”.

“(3) Applicable area—The term applicable area means—

“(A) in the case of a metropolitan census tract, the metropolitan area in which such census tract is located, and

“(B) in the case of a census tract other than a census tract described in subparagraph (A), the State.

“(4) Substantial rehabilitation—The term substantial rehabilitation means rehabilitation efforts involving qualified development costs that are not less than the greater of—

“(A) $20,000, or

“(B) 20 percent of the cost of acquiring buildings and land.

“(5) Qualified completion event—The term qualified completion event means—

“(A) in the case of a qualified residence that is built or substantially rehabilitated as part of a qualified project and sold, an affordable sale, or

“(B) in the case of a qualified residence that is substantially rehabilitated as part of a qualified project and owned by the same qualified homeowner throughout such rehabilitation, the completion of such rehabilitation (as determined by the neighborhood homes credit agency) to the standards promulgated under subsection (h)(1)(D).

“(6) Qualified homeowner

“(A) In general—The term qualified homeowner means, with respect to a qualified residence, an individual—

“(i) who owns and uses such qualified residence as the principal residence of such individual, and

“(ii) whose income is 140 percent or less of the applicable area median gross income for the location of the qualified residence.

“(B) Ownership—For purposes of a cooperative housing corporation (as such term is defined in section 216(b)), a tenant-stockholder shall be treated as owning the house or apartment which such person is entitled to occupy.

“(C) Income—For purposes of this paragraph, income shall be a determined in accordance with sections 143(f)(2) and 143(f)(4).

“(D) Timing—For purposes of this paragraph, the income of a taxpayer shall be determined—

“(i) in the case of a qualified residence that is built or substantially rehabilitated as part of a qualified project and sold, at the time a binding contract for purchase is made, or

“(ii) in the case of a qualified residence that is occupied by a qualified homeowner and intended to be substantially rehabilitated as part of a qualified project, at the time a binding contract to undertake such rehabilitation is made.

“(7) Neighborhood homes credit agency—The term neighborhood homes credit agency means the agency designated by the governor of a State as the neighborhood homes credit agency of the State.

“(g) Allocation

“(1) State neighborhood homes credit ceiling—The State neighborhood homes credit amount for a State for a calendar year is an amount equal to the greater of—

“(A) the product of $6, multiplied by the State population (determined in accordance with section 146(j)), or

“(B) $8,000,000.

“(2) Unused amount—The State neighborhood homes credit amount for a calendar year shall be increased by the sum of—

“(A) any amount certified by the neighborhood homes credit agency of the State as having been previously allocated to a qualified project and not used during the 5-year period described in subsection (b)(2)(B)(iii), plus

“(B) sum of the amount by which the amount determined under paragraph (1) (without application of this paragraph) exceeded the amount allocated to qualified projects in each of the three immediately preceding calendar years.

“(3) Portion of state credit ceiling for certain projects involving qualified nonprofit organizations—Rules similar to the rules of section 42(h)(5) shall apply.

“(h) Responsibilities of neighborhood homes credit agencies

“(1) In general—Notwithstanding subsection (g), the State neighborhood homes credit dollar amount shall be zero for a calendar year unless the neighborhood homes credit agency of the State—

“(A) allocates such amount pursuant to a qualified allocation plan of the neighborhood homes credit agency,

“(B) allocates not more than 20 percent of such amount for the previous year to projects with respect to qualified residences in census tracts under subsection (e)(1)(C) or (e)(2),

“(C) promulgates standards with respect to reasonable qualified development costs and fees,

“(D) promulgates standards with respect to construction quality, and

“(E) submits to the Secretary (at such time and in such manner as the Secretary may prescribe) an annual report specifying—

“(i) the amount of the neighborhood homes credits allocated to each qualified project for the previous year,

“(ii) with respect to each qualified residence completed in the preceding calendar year—

“(I) the census tract in which such qualified residence is located,

“(II) with respect to the qualified project that includes such qualified residence, the year in which such project received an allocation under this section,

“(III) whether such qualified residence was new or substantially rehabilitated,

“(IV) the eligible basis of such qualified residence,

“(V) the amount of the neighborhood homes credit with respect to such qualified residence,

“(VI) the sales price of such qualified residence or, in the case of a qualified residence that is substantially rehabilitated as part of a qualified project and is owned by the same qualified homeowner during the entirety of such rehabilitation, the cost of the substantial rehabilitation, and

“(VII) the income of the qualified homeowner (expressed as a percentage of the applicable area median gross income for the location of the qualified residence), and

“(iii) such other information as the Secretary may require.

“(2) Qualified allocation plan—For purposes of this subsection, the term qualified allocation plan means any plan which—

“(A) sets forth the selection criteria to be used to prioritize qualified projects for allocations of State neighborhood homes credit dollar amounts, including—

“(i) the need for new or substantially rehabilitated owner-occupied homes in the area addressed by the project,

“(ii) the expected contribution of the project to neighborhood stability and revitalization,

“(iii) the capability of the project sponsor, and

“(iv) the likelihood the project will result in long-term homeownership,

“(B) has been made available for public comment, and

“(C) provides a procedure that the neighborhood homes credit agency (or any agent or contractor of such agency) shall follow for purposes of—

“(i) identifying noncompliance with any provisions of this section, and

“(ii) notifying the Internal Revenue Service of any such noncompliance of which the agency becomes aware.

“(i) Possessions treated as states—For purposes of this section, the term State includes the District of Columbia and a possession of the United States.

“(j) Repayment

“(1) In general

“(A) Sold during 5-year period—If a qualified residence is sold during the 5-year period beginning on the date of the qualified completion event described in subsection (a) with respect to such qualified residence, the seller shall transfer an amount equal to the repayment amount from the amount realized on such sale to the relevant neighborhood homes credit agency.

“(B) Use of repayments—A neighborhood homes credit agency shall use any amount received pursuant to subparagraph (A) only for purposes of qualified projects.

“(2) Repayment amount—For purposes of paragraph (1)(A), the repayment amount is an amount equal to 50 percent of the gain from such resale, reduced by 20 percent for each year of the 5-year period referred to in paragraph (1)(A) which ends before the date of the sale referred to in such paragraph.

“(3) Lien for repayment amount—A neighborhood homes credit agency receiving an allocation under this section shall place a lien on each qualified residence that is built or rehabilitated as part of a qualified project for an amount such agency deems necessary to ensure potential repayment pursuant to paragraph (1)(A).

“(4) Denial of deductions if converted to rental housing—If, during the 5-year period beginning on the date of the qualified completion event described in subsection (a), an individual who owns a qualified residence fails to use such qualified residence as such individual’s principal residence for any period of time, no deduction shall be allowed for expenses paid or incurred by such individual with respect to renting, during such period of time, such qualified residence.

“(5) Waiver—The neighborhood homes credit agency may waive the repayment required under paragraph (1)(A) in the case of homeowner experiencing a hardship.

“(k) Report

“(1) In general—The Secretary shall annually issue a report, to be made available to the public, which contains the information submitted pursuant to subsection (h)(1)(E).

“(2) De-identification—The Secretary shall ensure that any information made public pursuant to paragraph (1) excludes any information that would allow for the identification of qualified homeowners.

“(l) Inflation adjustment

“(1) In general—In the case of a calendar year after 2020, the dollar amounts in this section shall be increased by an amount equal to—

“(A) such dollar amount, multiplied by

“(B) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting “calendar year 2019” for “calendar year 2016” in subparagraph (A)(ii) thereof.

“(2) Rounding

“(A) In the case of the dollar amount in subsection (f)(4), any increase under paragraph (1) which is not a multiple of $1,000 shall be rounded to the nearest multiple of $1,000.

“(B) In the case of the dollar amount in subsection (g)(1)(A)(i), any increase under paragraph (1) which is not a multiple of $0.01 shall be rounded to the nearest multiple of $0.01.

“(C) In the case of the dollar amount in subsection (g)(1)(A)(ii), any increase under paragraph (1) which is not a multiple of $100,000 shall be rounded to the nearest multiple of $100,000.”

“(37) the neighborhood homes credit determined under section 42B(a),”