Us Congress 2025-2026 Regular Session

Us Congress House Bill HB1255 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	I
2	2	119THCONGRESS
3	3	1
4	4	STSESSION H. R. 1255
5	5	To amend the Internal Revenue Code of 1986 to reinstate advance refunding
6	6	bonds.
7	7	IN THE HOUSE OF REPRESENTATIVES
8	8	FEBRUARY12, 2025
9	9	Mr. K
10	10	USTOFF(for himself, Mr. YAKYM, Ms. MOOREof Wisconsin, and Mr.
11	11	P
12	12	ANETTA) introduced the following bill; which was referred to the Com-
13	13	mittee on Ways and Means
14	14	A BILL
15	15	To amend the Internal Revenue Code of 1986 to reinstate
16	16	advance refunding bonds.
17	17	Be it enacted by the Senate and House of Representa-1
18	18	tives of the United States of America in Congress assembled, 2
19	19	SECTION 1. SHORT TITLE. 3
20	20	This Act may be cited as the ‘‘Investing in Our Com-4
21	21	munities Act’’. 5
22	22	SEC. 2. TREATMENT OF ADVANCE REFUNDING BONDS. 6
23	23	(a) I
24	24	NGENERAL.—Section 149(d) of the Internal 7
25	25	Revenue Code of 1986 is amended— 8
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28	28	•HR 1255 IH
29	29	(1) in paragraph (1), by striking ‘‘to advance 1
30	30	refund another bond’’ and inserting ‘‘as part of an 2
31	31	issue described in paragraph (2), (3), or (4)’’; 3
32	32	(2) by redesignating paragraphs (2) and (3) as 4
33	33	paragraphs (6) and (7), respectively; and 5
34	34	(3) by inserting after paragraph (1) the fol-6
35	35	lowing new paragraphs: 7
36	36	‘‘(2) C
37	37	ERTAIN PRIVATE ACTIVITY BONDS .—An 8
38	38	issue is described in this paragraph if any bond 9
39	39	(issued as part of such issue) is issued to advance 10
40	40	refund a private activity bond (other than a qualified 11
41	41	501(c)(3) bond). 12
42	42	‘‘(3) O
43	43	THER BONDS.— 13
44	44	‘‘(A) I
45	45	N GENERAL.—An issue is described 14
46	46	in this paragraph if any bond (issued as part of 15
47	47	such issue), hereinafter in this paragraph re-16
48	48	ferred to as the ‘refunding bond’, is issued to 17
49	49	advance refund a bond unless— 18
50	50	‘‘(i) the refunding bond is only— 19
51	51	‘‘(I) the 1st advance refunding of 20
52	52	the original bond if the original bond 21
53	53	is issued after 1985, or 22
54	54	‘‘(II) the 1st or 2nd advance re-23
55	55	funding of the original bond if the 24
56	56	original bond was issued before 1986, 25
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59	59	•HR 1255 IH
60	60	‘‘(ii) in the case of refunded bonds 1
61	61	issued before 1986, the refunded bond is 2
62	62	redeemed not later than the earliest date 3
63	63	on which such bond may be redeemed at 4
64	64	par or at a premium of 3 percent or less, 5
65	65	‘‘(iii) in the case of refunded bonds 6
66	66	issued after 1985, the refunded bond is re-7
67	67	deemed not later than the earliest date on 8
68	68	which such bond may be redeemed, 9
69	69	‘‘(iv) the initial temporary period 10
70	70	under section 148(c) ends— 11
71	71	‘‘(I) with respect to the proceeds 12
72	72	of the refunding bond not later than 13
73	73	30 days after the date of issue of such 14
74	74	bond, and 15
75	75	‘‘(II) with respect to the proceeds 16
76	76	of the refunded bond on the date of 17
77	77	issue of the refunding bond, and 18
78	78	‘‘(v) in the case of refunded bonds to 19
79	79	which section 148(e) did not apply, on and 20
80	80	after the date of issue of the refunding 21
81	81	bond, the amount of proceeds of the re-22
82	82	funded bond invested in higher yielding in-23
83	83	vestments (as defined in section 148(b)) 24
84	84	which are nonpurpose investments (as de-25
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87	87	•HR 1255 IH
88	88	fined in section 148(f)(6)(A)) does not ex-1
89	89	ceed— 2
90	90	‘‘(I) the amount so invested as 3
91	91	part of a reasonably required reserve 4
92	92	or replacement fund or during an al-5
93	93	lowable temporary period, and 6
94	94	‘‘(II) the amount which is equal 7
95	95	to the lesser of 5 percent of the pro-8
96	96	ceeds of the issue of which the re-9
97	97	funded bond is a part or $100,000 (to 10
98	98	the extent such amount is allocable to 11
99	99	the refunded bond). 12
100	100	‘‘(B) S
101	101	PECIAL RULES FOR REDEMP -13
102	102	TIONS.— 14
103	103	‘‘(i) I
104	104	SSUER MUST REDEEM ONLY IF 15
105	105	DEBT SERVICE SAVINGS .—Clauses (ii) and 16
106	106	(iii) of subparagraph (A) shall apply only 17
107	107	if the issuer may realize present value debt 18
108	108	service savings (determined without regard 19
109	109	to administrative expenses) in connection 20
110	110	with the issue of which the refunding bond 21
111	111	is a part. 22
112	112	‘‘(ii) R
113	113	EDEMPTIONS NOT REQUIRED 23
114	114	BEFORE 90TH DAY .—For purposes of 24
115	115	clauses (ii) and (iii) of subparagraph (A), 25
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118	118	•HR 1255 IH
119	119	the earliest date referred to in such clauses 1
120	120	shall not be earlier than the 90th day after 2
121	121	the date of issuance of the refunding bond. 3
122	122	‘‘(4) A
123	123	BUSIVE TRANSACTIONS PROHIBITED .— 4
124	124	An issue is described in this paragraph if any bond 5
125	125	(issued as part of such issue) is issued to advance 6
126	126	refund another bond and a device is employed in 7
127	127	connection with the issuance of such issue to obtain 8
128	128	a material financial advantage (based on arbitrage) 9
129	129	apart from savings attributable to lower interest 10
130	130	rates. 11
131	131	‘‘(5) S
132	132	PECIAL RULES FOR PURPOSES OF PARA -12
133	133	GRAPH (3).—For purposes of paragraph (3), bonds 13
134	134	issued before the date of the enactment of this sub-14
135	135	section shall be taken into account under subpara-15
136	136	graph (A)(i) thereof except— 16
137	137	‘‘(A) a refunding which occurred before 17
138	138	1986 shall be treated as an advance refunding 18
139	139	only if the refunding bond was issued more 19
140	140	than 180 days before the redemption of the re-20
141	141	funded bond, and 21
142	142	‘‘(B) a bond issued before 1986, shall be 22
143	143	treated as advance refunded no more than once 23
144	144	before March 15, 1986.’’. 24
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147	147	•HR 1255 IH
148	148	(b) C ONFORMING AMENDMENT.—Section 1
149	149	148(f)(4)(C) of such Code is amended by redesignating 2
150	150	clauses (xiv) through (xvi) as clauses (xv) through (xvii) 3
151	151	and by inserting after clause (xiii) the following new 4
152	152	clause: 5
153	153	‘‘(xiv) D
154	154	ETERMINATION OF INITIAL 6
155	155	TEMPORARY PERIOD .—For purposes of 7
156	156	this subparagraph, the end of the initial 8
157	157	temporary period shall be determined with-9
158	158	out regard to section 149(d)(3)(A)(iv).’’. 10
159	159	(c) E
160	160	FFECTIVEDATE.—The amendments made by 11
161	161	this section shall apply to advance refunding bonds issued 12
162	162	after the date of the enactment of this Act. 13
163	163	Æ
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