
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 26USC103]

 
                     TITLE 26--INTERNAL REVENUE CODE
 
                        Subtitle A--Income Taxes
 
                  CHAPTER 1--NORMAL TAXES AND SURTAXES
 
               Subchapter B--Computation of Taxable Income
 
         PART III--ITEMS SPECIFICALLY EXCLUDED FROM GROSS INCOME
 
Sec. 103. Interest on State and local bonds


(a) Exclusion

    Except as provided in subsection (b), gross income does not include 
interest on any State or local bond.

(b) Exceptions

    Subsection (a) shall not apply to--

       (1) Private activity bond which is not a qualified bond

        Any private activity bond which is not a qualified bond (within 
    the meaning of section 141).

                         (2) Arbitrage bond

        Any arbitrage bond (within the meaning of section 148).

                (3) Bond not in registered form, etc.

        Any bond unless such bond meets the applicable requirements of 
    section 149.

(c) Definitions

    For purposes of this section and part IV--

                       (1) State or local bond

        The term ``State or local bond'' means an obligation of a State 
    or political subdivision thereof.

                              (2) State

        The term ``State'' includes the District of Columbia and any 
    possession of the United States.

(Aug. 16, 1954, ch. 736, 68A Stat. 29; Pub. L. 90-364, title I, 
Sec. 107(a), June 28, 1968, 82 Stat. 266; Pub. L. 90-634, title IV, 
Sec. 401(a), Oct. 24, 1968, 82 Stat. 1349; Pub. L. 91-172, title VI, 
Sec. 601(a), Dec. 30, 1969, 83 Stat. 656; Pub. L. 92-178, title III, 
Sec. 315(a), (b), Dec. 10, 1971, 85 Stat. 529; Pub. L. 94-164, 
Sec. 7(a), Dec. 23, 1975, 89 Stat. 976; Pub. L. 94-182, title III, 
Sec. 301(a), Dec. 31, 1975, 89 Stat. 1056; Pub. L. 94-455, title XIX, 
Secs. 1901(a)(17), (b)(8)(B), 1906(b)(13)(A), title XXI, Secs. 2105(a)-
(c), 2137(d), Oct. 4, 1976, 90 Stat. 1765, 1766, 1794, 1834, 1902, 1931; 
Pub. L. 95-339, title II, Sec. 201(a), Aug. 8, 1978, 92 Stat. 467; Pub. 
L. 95-600, title III, Secs. 331(a), (b), 332(a), 333(a), 334(a), (b), 
title VII, Sec. 703(j)(1), (q)(1), Nov. 6, 1978, 92 Stat. 2839-2841, 
2941, 2944; Pub. L. 96-222, title I, Sec. 107(a)(3)(C), Apr. 1, 1980, 94 
Stat. 223; Pub. L. 96-223, title II, Secs. 241(a), 242(a), 244(a), Apr. 
2, 1980, 94 Stat. 281, 283, 286; Pub. L. 96-499, title XI, Sec. 1103, 
Dec. 5, 1980, 94 Stat. 2669; Pub. L. 97-34, title VIII, Secs. 811(a), 
(b), 812(a), Aug. 13, 1981, 95 Stat. 349, 350; Pub. L. 97-248, title II, 
Secs. 214(a)-(e), 215(a), (b), 217(a)-(d), 219(a), 221(a), (b), (c)(1), 
title III, Sec. 310(b)(1), (c)(1), (2), Sept. 3, 1982, 96 Stat. 466-469, 
472-474, 477, 478, 596, 599; Pub. L. 97-424, title V, Sec. 547(a), Jan. 
6, 1983, 96 Stat. 2199; Pub. L. 97-473, title II, Sec. 202(b)(2), Jan. 
14, 1983, 96 Stat. 2609; Pub. L. 98-369, div. A, title IV, 
Sec. 474(r)(4), title VI, Secs. 621-624(a), (b)(2), (3), 626(a), 627, 
628(a), (c)-(e), (g), 630, July 18, 1984, 98 Stat. 839, 915-922, 924, 
926, 928, 931-933; Pub. L. 99-272, title XIII, Sec. 13209(e), Apr. 7, 
1986, 100 Stat. 323; Pub. L. 99-514, title XIII, Sec. 1301(a), title 
XVIII, Secs. 1864(a)(1), (b)-(e), 1865(a), 1869(a), (b), 1870, 
1871(a)(1), (b), 1899A(2)-(4), Oct. 22, 1986, 100 Stat. 2602, 2885, 
2886, 2888, 2890, 2891, 2958; Pub. L. 100-647, title I, 
Sec. 1013(a)(34)(A), (c)(12)(A), Nov. 10, 1988, 102 Stat. 3544, 3547.)


                               Amendments

    1988--Subsec. (b)(6)(N). Pub. L. 100-647, Sec. 1013(c)(12)(A), 
amended subpar. (N), as in effect on the day before the date of the 
enactment of Pub. L. 99-514 [Oct. 22, 1986], by redesignating cls. (ii) 
and (iii) as (iii) and (iv), respectively, and by striking out cl. (i) 
and inserting in lieu thereof the following new cls.:
    ``(i) In general.--Except as provided in clause (ii), this paragraph 
shall not apply to any obligation issued after December 31, 1986.
    ``(ii) Certain refundings.--This paragraph shall apply to any 
obligation (or series of obligations) issued to refund an obligation 
issued on or before December 31, 1986, if--
        ``(I) the average maturity date of the issue of which the 
    refunding obligation is a part is not later than the average 
    maturity date of the obligations to be refunded by such issue,
        ``(II) the amount of the refunding obligation does not exceed 
    the outstanding amount of the refunded obligation, and
        ``(III) the proceeds of the refunding obligation are used to 
    redeem the refunded obligation not later than 90 days after the date 
    of the issuance of the refunding obligation.
For purposes of subclause (I), average maturity shall be determined in 
accordance with subsection (b)(14)(B)(i).''
    Subsec. (c)(7). Pub. L. 100-647, Sec. 1013(a)(34)(A), amended par. 
(7), as in effect on the day before the date of the enactment of Pub. L. 
99-514 [Oct. 22, 1986], by substituting ``necessary'' for ``necessary''.
    1986--Pub. L. 99-514, Sec. 1301(a), in amending section generally, 
substituted ``Interest on State and local bonds'' for ``Interest on 
certain governmental obligations'' in section catchline.
    Subsec. (a). Pub. L. 99-514, Sec. 1301(a), substituted ``Exclusion'' 
for ``General rule'' in heading and amended text generally. Prior to 
amendment, text read as follows: ``Gross income does not include 
interest on--
        ``(1) the obligations of a State, a Territory, or a possession 
    of the United States, or any political subdivision of any of the 
    foregoing, or of the District of Columbia; and
        ``(2) qualified scholarship funding bonds.''
    Subsec. (b). Pub. L. 99-514, Sec. 1301(a), in amending section 
generally, substituted provision relating to exceptions for provision 
relating to industrial development bonds.
    Subsec. (b)(11). Pub. L. 99-272 struck out par. (11) relating to 
pollution control facilities acquired by regional pollution control 
authorities.
    Subsec. (b)(13), (14)(A). Pub. L. 99-514, Sec. 1871(b), substituted 
``and (6)'' for ``(6), and (7)''.
    Subsec. (b)(16)(A). Pub. L. 99-514, Sec. 1870, substituted ``clause 
(ii)'' for ``clause (i)''.
    Subsec. (b)(17)(A). Pub. L. 99-514, Sec. 1871(b), substituted ``and 
(6)'' for ``(6), and (7)''.
    Subsec. (c). Pub. L. 99-514, Sec. 1301(a), in amending section 
generally, substituted provision relating to definitions for provision 
relating to arbitrage.
    Subsecs. (d) to (g). Pub. L. 99-514, Sec. 1301(a), in amending 
section generally, struck out subsecs. (d) to (g) which related to 
certain irrigation dams, qualified scholarship funding bonds, certain 
federally guaranteed obligations, and qualified steam-generating or 
alcohol-producing facilities, respectively.
    Subsec. (h). Pub. L. 99-514, Sec. 1301(a), in amending section 
generally, struck out subsec. (h) which provided that obligations must 
not be guaranteed.
    Subsec. (h)(2)(A). Pub. L. 99-514, Sec. 1899A(2), substituted 
``guaranteed'' for ``guaranted''.
    Subsec. (h)(5)(A). Pub. L. 99-514, Sec. 1865(a), struck out ``the 
United States,'' after ``program of''.
    Subsecs. (i) to (k). Pub. L. 99-514, Sec. 1301(a), in amending 
section generally, struck out subsecs. (i) to (k) which related to 
obligations of certain volunteer fire departments, provided that 
obligations must be in registered form to be tax-exempt, and required 
public approval for industrial development bonds, respectively.
    Subsec. (l). Pub. L. 99-514, Sec. 1301(a), in amending section 
generally, struck out subsec. (l) which related to information reporting 
requirements for certain bonds.
    Subsec. (l)(2)(F). Pub. L. 99-514, Sec. 1864(d), added subpar. (F) 
which read: ``if such obligation is a private activity bond (as defined 
in subsection (n)(7)), such information as the Secretary may require for 
purposes of determining whether the requirements of subsection (n) are 
met with respect to such obligation.''
    Subsec. (m). Pub. L. 99-514, Sec. 1301(a), in amending section 
generally, struck out subsec. (m) which related to obligations exempt 
other than under this title.
    Subsec. (m)(1). Pub. L. 99-514, Sec. 1871(a)(1), substituted ``(j), 
(k), (l), (n), and (o)'' for ``(k), (l), and (n)''.
    Subsec. (m)(3)(B). Pub. L. 99-514, Sec. 1899A(3), substituted 
``608(a)(6)(A)'' for ``608(6)(A)''.
    Subsec. (n). Pub. L. 99-514, Sec. 1301(a), in amending section 
generally, struck out subsec. (n) which related to limitation on 
aggregate amount of private activity bonds issued during any calendar 
year.
    Subsec. (n)(6)(A), (B)(i). Pub. L. 99-514, Sec. 1864(b), substituted 
``governmental units or other authorities'' for ``governmental units''.
    Subsec. (n)(7)(C)(i). Pub. L. 99-514, Sec. 1864(c), substituted 
``all of the property to be financed by the obligation'' for ``the 
property described in such paragraph''.
    Subsec. (n)(10)(B). Pub. L. 99-514, Sec. 1864(e), substituted 
``identify project'' for ``specify project'' in heading and ``identify 
(with reasonable specificity) the project'' for ``specify the project'' 
in text of subpar. (B)(i).
    Subsec. (n)(10)(D). Pub. L. 99-514, Sec. 1864(e)(2), substituted 
``any identification or specification'' for ``any specification''.
    Subsec. (n)(13). Pub. L. 99-514, Sec. 1864(a)(1), added par. (13).
    Subsec. (o). Pub. L. 99-514, Sec. 1301(a), in amending section 
generally, struck out subsec. (o) relating to consumer loan bonds.
    Pub. L. 99-514, Sec. 1869(a), (b)(1), substituted ``Private loan 
bonds'' for ``Consumer loan bonds'' in subsection and par. (2) headings, 
``private loan bond'' for ``consumer loan bond'' in text of pars. (1), 
(2)(A) and (B), and ``subsection (c)(6)(H)(i)'' for ``subsection 
(c)(6)(G)(i)'' in par. (2)(C)(ii).
    Pub. L. 99-514, Sec. 1869(b)(2), redesignated subsec. (o), relating 
to cross references, as (p).
    Subsec. (p). Pub. L. 99-514, Sec. 1301(a), in amending section 
generally, struck out subsec. (p) which related to cross references.
    Pub. L. 99-514, Sec. 1869(b)(2), redesignated former subsec. (o), 
relating to cross references, as (p).
    Subsec. (p)(4). Pub. L. 99-514, Sec. 1899A(4), substituted ``October 
27, 1949 (48 U.S.C. 1403)'' for ``October 27, 1919 (48 U.S.C. 1403)''.
    1984--Subsec. (b)(4). Pub. L. 98-369, Sec. 628(e), inserted ``For 
purposes of subparagraph (A), any property shall not be treated as 
failing to be residential rental property merely because part of the 
building in which such property is located is used for purposes other 
than residential rental purposes.''
    Subsec. (b)(6)(F)(iv). Pub. L. 98-369, Sec. 474(r)(4), substituted 
``section 30(b)(2)(A)'' for ``section 44F(b)(2)(A)''.
    Subsec. (b)(6)(N). Pub. L. 98-369, Sec. 630, designated existing 
provisions as cl. (i) and added cls. (ii) and (iii).
    Subsec. (b)(6)(P). Pub. L. 98-369, Sec. 628(c), added subpar. (P).
    Subsec. (b)(7). Pub. L. 98-369, Sec. 628(g), repealed par. (7) which 
related to advance refunding of qualified public facilities.
    Subsec. (b)(13). Pub. L. 98-369, Sec. 628(d), inserted ``For 
purposes of this paragraph-- (A) a partnership and each of its partners 
(and their spouses and minor children) shall be treated as related 
persons, and (B) an S corporation and each of its shareholders (and 
their spouses and minor children) shall be treated as related persons.''
    Subsec. (b)(15). Pub. L. 98-369, Sec. 623, added par. (15).
    Subsec. (b)(16) to (18). Pub. L. 98-369, Sec. 627, added pars. (16) 
to (18).
    Subsec. (c). Pub. L. 98-369, Sec. 624(b)(2), struck out ``bonds'' 
after ``Arbitrage'' in heading.
    Subsec. (c)(1). Pub. L. 98-369, Sec. 624(b)(3), inserted ``to 
arbitrage bonds'' in heading.
    Subsec. (c)(6), (7). Pub. L. 98-369, Sec. 624(a), added par. (6) and 
redesignated former par. (6) as (7).
    Subsec. (h). Pub. L. 98-369, Sec. 622, amended subsec. (h) 
generally, in par. (1) substituting provisions that obligations are not 
included in the section if they are federally guaranteed for provisions 
which excluded obligations guaranteed, in whole or part, by the U.S. 
under a program to conserve energy, or under other Federal or State 
programs, in par. (2) substituting provisions defining ``federally 
guaranteed'' for provisions setting forth obligations to which this 
subsection applies, and adding pars. (3) to (5).
    Subsec. (m)(1). Pub. L. 98-369, Sec. 628(a)(1), inserted ``In the 
case of an obligation issued after December 31, 1983, such obligation 
shall not be treated as described in this paragraph unless the 
appropriate requirements of subsections (b), (c), (h), (k), (l), and (n) 
of this section and section 103A are met with respect to such 
obligation. For purposes of applying such requirements, a possession of 
the United States shall be treated as a State; except that clause (ii) 
of subsection (n)(4)(A) shall not apply.''
    Subsec. (m)(2)(B). Pub. L. 98-369, Sec. 628(a)(2), substituted ``is 
exempt from tax under this title without regard to any provision of law 
which is not contained in this title and which is not contained in a 
revenue Act'' for ``is exempt from taxation under any provision of this 
title''.
    Subsec. (m)(3). Pub. L. 98-369, Sec. 628(a)(3), added par. (3).
    Subsec. (n). Pub. L. 98-369, Sec. 621, added subsec. (n). Former 
subsec. (n), relating to cross references, redesignated (o).
    Subsec. (o). Pub. L. 98-369, Sec. 626(a), added subsec. (o) relating 
to consumer loan bonds.
    Pub. L. 98-369, Sec. 621, redesignated subsec. (n), relating to 
cross references, as (o).
    1983--Subsec. (m). Pub. L. 97-424, Sec. 547(a), added subsec. (m). 
Former subsec. (m) redesignated (n).
    Pub. L. 97-473 amended subsec. (m) generally, adding pars. (1) and 
(2), redesignating former pars. (1) to (3) as (3) to (5), respectively, 
and striking out par. (24) which had provided reference regarding 
exempt-interest dividends to section 852(b)(5)(B.) See section 722(b) of 
Pub. L. 98-369, set out as a note below.
    Subsec. (n). Pub. L. 97-424, Sec. 547(a), redesignated former 
subsec. (m), relating to cross references, as (n).
    1982--Subsec. (b)(2). Pub. L. 97-248, Sec. 215(b)(2), substituted 
``For purposes of this section'' for ``For purposes of this 
subsection''.
    Subsec. (b)(4). Pub. L. 97-248, Secs. 217(a)(1), (b), 221(a), 
(c)(1), 310(c)(1), in subpar. (A) substituted ``if at all times during 
the qualified project period'' for ``if each obligation issued pursuant 
to the issue is in registered form and if'' after ``residential rental 
property'', and struck out ``(within the meaning of section 
167(k)(3)(B))'' after ``low or moderate income'', added subpar. (J), 
struck out provision that for purposes of subpar. (A), ``targeted area 
project'' meant a project located in a qualified census tract (within 
the meaning of section 103A(k)(2)) or an area of chronic economic 
distress (within the meaning of section 103A(k)(3)) and, in last 
sentence, substituted ``electric energy or gas from'' for ``electric 
energy from''.
    Subsec. (b)(6)(C). Pub. L. 97-248, Sec. 217(a)(3), substituted 
``paragraph (13)'' for ``paragraph (7)''.
    Subsec. (b)(6)(F)(iv). Pub. L. 97-248, Sec. 214(d), added cl. (iv).
    Subsec. (b)(6)(K) to (O). Pub. L. 97-248, Sec. 214(a)-(c), (e), 
added subpars. (K) to (O).
    Subsec. (b)(9)(A). Pub. L. 97-248, Sec. 217(c), inserted ``ferry,'' 
after ``rail car'' in provisions preceding cl. (i), and in cl. (ii), 
inserted ``(or, in the case of a ferry, mass transportation services)'' 
after ``mass commuting services''.
    Subsec. (b)(10). Pub. L. 97-248, Sec. 217(a)(2), added par. (10). 
Former par. (10) redesignated (13).
    Subsec. (b)(11). Pub. L. 97-248, Sec. 217(d), added par. (11).
    Subsec. (b)(12). Pub. L. 97-248, Sec. 221(b), added par. (12). 
[Provisions of par. (12)(A) were formerly contained, as undesignated 
provisions, in par. (4).]
    Subsec. (b)(13). Pub. L. 97-248, Sec. 217(a)(2), redesignated former 
par. (10) as (13).
    Subsec. (b)(14). Pub. L. 97-248, Sec. 219(a), added par. (14).
    Subsec. (h). Pub. L. 97-248, Sec. 310(c)(2), substituted ``must not 
be guaranteed or subsidized'' for ``must be in registered form and not 
guaranteed or subsidized'' in heading, and in par. (1) struck out 
subpar. (A) reading ``such obligation is not issued in registered 
form'', and redesignated subpars. (B) and (C) as (A) and (B), 
respectively.
    Subsec. (j). Pub. L. 97-248, Sec. 310(b)(1), added subsec. (j). 
Former subsec. (j), relating to cross references, redesignated (m).
    Subsec. (k). Pub. L. 97-248, Sec. 215(a), added subsec. (k).
    Subsec. (l). Pub. L. 97-248, Sec. 215(b)(1), added subsec. (l).
    Subsec. (m). Pub. L. 97-248, Secs. 215(a), (b)(1), 310(b)(1), 
redesignated former subsec. (j), relating to cross references, as (m).
    1981--Subsec. (b)(4)(I). Pub. L. 97-34, Sec. 811(a), added subpar. 
(I).
    Subsec. (b)(9), (10). Pub. L. 97-34, Sec. 811(b), added par. (9) and 
redesignated former par. (9) as (10).
    Subsecs. (i), (j). Pub. L. 97-34, Sec. 812(a), added subsec. (i) and 
redesignated former subsec. (i) as (j).
    1980--Subsec. (b)(4). Pub. L. 96-499, Sec. 1103(b), inserted before 
last sentence provisions defining ``targeted area project'' for purposes 
of subpar. (A).
    Subsec. (b)(4)(A). Pub. L. 96-499, Sec. 1103(a), substituted 
provisions relating to low or moderate income residential rental 
property for provisions relating to residential real property for family 
units.
    Subsec. (b)(4)(H). Pub. L. 96-223, Sec. 242(a)(1), added subpar. 
(H).
    Subsec. (b)(6)(J). Pub. L. 96-499, Sec. 1103(c), added subpar. (J).
    Subsec. (b)(8), (9). Pub. L. 96-223, Sec. 242(a)(2), added par. (8) 
and redesignated former par. (8) as (9).
    Subsec. (c)(5). Pub. L. 96-222, Sec. 107(a)(3)(C), amended the 
directory language of Pub. L. 96-500, Sec. 703(q)(1). See 1978 Amendment 
note below for subsec. (c)(5).
    Subsec. (g). Pub. L. 96-223, Sec. 241(a), added subsec. (g). Former 
subsec. (g) redesignated (i).
    Subsec. (h). Pub. L. 96-223, Sec. 244(a), added subsec. (h).
    Subsec. (i). Pub. L. 96-223, Secs. 241(a), 244(a), redesignated 
former subsec. (g) as (i).
    1978--Subsec. (b)(1). Pub. L. 95-600, Sec. 703(j)(1)(A), substituted 
``subsection (a)(1) or (2)'' for ``subsection (a)(1)'' in heading.
    Subsec. (b)(4). Pub. L. 95-600, Secs. 332(a), 333(a), in subpar. 
(G)(i) inserted reference to electric utility, industrial, agricultural, 
or commercial users and added subpar. (G)(ii) and provision following 
subpar. (G)(ii) relating to the local furnishing of electric energy.
    Subsec. (b)(6)(D). Pub. L. 95-600, Sec. 331(a), substituted in 
heading and cl. (i) ``$10,000,000'' for ``$5,000,000''.
    Subsec. (b)(6)(I). Pub. L. 95-600, Sec. 331(b), added subpar. (I).
    Subsec. (b)(7), (8). Pub. L. 95-600, Sec. 334(a), (b), added par. 
(7), redesignated former par. (7) as (8) and, as so redesignated, 
substituted ``(6), and (7)'' for ``and (6)''.
    Subsec. (c)(1). Pub. L. 95-600, Sec. 703(j)(1)(B), substituted in 
heading and text ``(a)(1) or (2)'' for ``(a)(1) or (4)''.
    Subsec. (c)(2)(A). Pub. L. 95-600, Sec. 703(j)(1)(C), substituted 
``subsection (a)(1) or (2)'' for ``subsection (a)(1) or (2) or (4)''.
    Subsec. (c)(5). Pub. L. 95-600, Sec. 703(j)(1)(D), (q)(1), as 
amended by Pub. L. 96-222, Sec. 107(a)(3)(C), substituted ``section 438 
of the Higher Education Act of 1965'' for ``section 2 of the Emergency 
Insured Student Loan Act of 1969'' and ``paragraph (2)(A)'' for 
``subsection (d)(2)(A)''.
    Subsec. (d). Pub. L. 95-600, Sec. 703(j)(1)(E), substituted 
``subsection (b)(4)(G)'' for ``subsection (c)(4)(G)''.
    Subsec. (e). Pub. L. 95-339 redesignated second subsec. (e), 
relating to cross references, as (g).
    Subsec. (f). Pub. L. 95-339 added subsec. (f).
    Subsec. (g). Pub. L. 95-339 redesignated second subsec. (e), 
relating to cross references, as (g).
    1976--Subsec. (a). Pub. L. 94-455, Secs. 1901(a)(17)(A), 2105(a), 
added par. (2) relating to qualified scholarship funding bonds. Former 
pars. (2) and (3), relating to obligations of the United States and to 
the obligations of corporations organized under an Act of Congress, were 
struck out.
    Subsec. (b). Pub. L. 94-455, Sec. 1901(a)(17)(B), (C), redesignated 
subsec. (c) as (b) and in par. (1) of subsec. (b) as so redesignated 
substituted ``subsection (a)(1) or (2)'' for ``subsection (a)(1)''. 
Former subsec. (b), which created an exception to the rule that gross 
income did not include interest on obligations of the United States, by 
providing that the exception did not apply to obligations of the United 
States (with specified exceptions) unless under the authorizing Acts 
such interest is wholly exempt from the taxes imposed by this subtitle, 
was struck out.
    Subsec. (c). Pub. L. 94-455, Secs. 1901(a)(17)(B), (D), (b)(8)(B), 
1906(b)(13)(A), 2105(c), redesignated subsec. (d) as (c) and, in subsec. 
(c) as so redesignated, substituted ``(a)(1) or (4)'' for ``(a)(1)'' in 
par. (1) and ``(a)(1) or (2) or (4)'' for ``(a)(1)'' in par. (2)(A), 
substituted ``educational organization described in section 
170(b)(1)(A)(ii)'' for ``educational institution (within the meaning of 
section 151(e)(4))'' in par. (3)(A), added par. (5), redesignated former 
par. (5) as (6), and in par. (6) as so redesignated substituted 
``Secretary'' for ``Secretary or his delegate''. Former subsec. (c) 
redesignated (b). See Codification note above.
    Subsec. (d). Pub. L. 94-455, Sec. 1901(a)(17)(B), redesignated 
subsec. (e) as (d). Former subsec. (d) redesignated (c).
    Subsec. (e). Pub. L. 94-455, Secs. 1901(a)(17)(B), (E), 2105(b), 
2137(d), added subsec. (e) relating to qualified scholarship funding 
bonds, redesignated former subsec. (f) relating to cross references as a 
second subsec. (e), reduced the number of cross references in subsec. 
(e) as so redesignated from twenty-three (which made reference to 
various obligations of the United States and of corporations organized 
under Acts of Congress) to three, relating, respectively, to Puerto 
Rican bonds, Virgin Islands insular and municipal bonds, and certain 
obligations issued under title I of the Housing Act of 1949, and 
inserted a fourth cross reference, designated as par. (24) relating to 
the treatment of exempt-interest dividends. Former subsec. (e) 
redesignated (d).
    Subsec. (f). Pub. L. 94-455, Sec. 1901(a)(17)(B), redesignated 
subsec. (f), relating to cross references, as (e).
    1975--Subsecs. (e), (f). Pub. L. 94-182 and Pub. L. 94-164 made 
identical amendments, adding subsec. (e) and redesignating former 
subsec. (e) as (f).
    1971--Subsec. (c)(4)(E). Pub. L. 92-178, Sec. 315(a)(1), substituted 
``energy or gas,'' for ``energy, gas, or water or''.
    Subsec. (c)(4)(F). Pub. L. 92-178, Sec. 315(a)(2), substituted ``, 
or'' for a period.
    Subsec. (c)(4)(G). Pub. L. 92-178, Sec. 315(a)(3), added subpar. 
(G).
    Subsec. (c)(6)(F)(iii). Pub. L. 92-178, Sec. 315(b), substituted 
``$1,000,000'' for ``$250,000''.
    1969--Subsecs. (d), (e). Pub. L. 91-172 added subsec. (d) and 
redesignated former subsec. (d) as (e).
    1968--Subsec. (c). Pub. L. 90-364 added subsec. (c). Former subsec. 
(c) redesignated (d).
    Subsec. (c)(6)(D) to (H). Pub. L. 90-634 added subpars. (D) to (H).
    Subsec. (d). Pub. L. 90-364 redesignated former subsec. (c) as (d).


                    Effective Date of 1988 Amendment

    Section 1013(a)(34)(B) of Pub. L. 100-647 provided that: 
``Subparagraph (A) [amending this section] shall apply to obligations 
sold after May 2, 1978, and to which Treasury regulation section 1.103-
13 (1979) was provided to apply.''


                    Effective Date of 1986 Amendment

    Amendment by section 1301(a) of Pub. L. 99-514 applicable to bonds 
issued after Aug. 15, 1986, except as otherwise provided, see sections 
1311 to 1318 of Pub. L. 99-514, set out as an Effective Date; 
Transitional Rules note under section 141 of this title.
    Amendment by sections 1864(b)-(e), 1865(a), 1869(a), (b), 1870, and 
1871(b) of Pub. L. 99-514 effective, except as otherwise provided, as if 
included in the provisions of the Tax Reform Act of 1984, Pub. L. 98-
369, div. A, to which such amendment relates, see section 1881 of Pub. 
L. 99-514, set out as a note under section 48 of this title.
    Section 1864(a)(2) of Pub. L. 99-514 provided that:
    ``(A) Except as provided in subparagraph (B), the amendment made by 
paragraph (1) [amending this section] shall apply to obligations issued 
after the date of the enactment of this Act [Oct. 22, 1986] in taxable 
years ending after such date.
    ``(B) At the election of the issuer (made at such time and in such 
manner as the Secretary of the Treasury or his delegate shall 
prescribe), the amendment made by paragraph (1) shall apply to any 
obligation issued on or before the date of the enactment of this Act.''
    Section 1871(a)(2) of Pub. L. 99-514 provided that: ``The amendment 
made by paragraph (1) [amending this section] shall apply to obligations 
issued after March 28, 1985, in taxable years ending after such date.''


                    Effective Date of 1984 Amendment

    Amendment by section 474(r)(4) of Pub. L. 98-369 applicable to 
taxable years beginning after Dec. 31, 1983, and to carrybacks from such 
years, see section 475(a) of Pub. L. 98-369, set out as a note under 
section 21 of this title.
    Section 624(c) of Pub. L. 98-369, as amended by Pub. L. 99-514, 
title XVIII, Sec. 1867(a), Oct. 22, 1986, 100 Stat. 2888, provided that:
    ``(1) In general.--Except as otherwise provided in this subsection, 
the amendments made by this section [amending this section and section 
103A of this title] shall apply with respect to bonds issued after 
December 31, 1984.
    ``(2) Exception.--The amendments made by this section shall not 
apply to obligations issued for the Essex County New Jersey Resource 
Recovery Project authorized by the Port Authority of New York and New 
Jersey on November 10, 1983, as part of an agreement approved by Essex 
County, New Jersey, on July 7, 1981, and approved by the State of New 
Jersey on December 31, 1981. The aggregate face amount of bonds to which 
this paragraph applies shall not exceed $350,000,000.''
    Section 626(b) of Pub. L. 98-369, as amended by Pub. L. 99-514, 
Sec. 2, title XIII, Sec. 1317(22), title XVIII, Sec. 1869(c)(5), Oct. 
22, 1986, 100 Stat. 2095, 2698, 2890; Pub. L. 100-647, title I, 
Sec. 1013(g)(24), Nov. 10, 1988, 102 Stat. 3554, provided that:
    ``(1) In general.--Except as otherwise provided in this subsection 
the amendment made by subsection (a) [amending this section] shall apply 
to obligations issued after the date of enactment of this Act [July 18, 
1984].
    ``(2) Exceptions for certain student loan programs.--
        ``(A) In general.--The amendments made by this section [amending 
    this section] shall not apply to obligations issued by a program 
    described in the following table to the extent the aggregate face 
    amount of such obligations does not exceed the amount of allowable 
    obligations specified in the following table with respect to such 
    program:


                                                 Amount of Allowable
                  Program                            Obligations

  Colorado Student Obligation Bond          $60 million
   Authority..............................
  Connecticut Higher Education              $15.5 million
   Supplementary Loan Authority...........
  District of Columbia....................  $50 million
  Illinois Higher Education Authority.....  $70 million
  State of Iowa...........................  $16 million
  Louisiana Public Facilities Authority...  $75 million
  Maine Health and Higher Education         $5 million
   Facilities Authority...................
  Maryland Higher Education Supplemental    $24 million
   Loan Program...........................
  Massachusetts College Student Loan        $90 million
   Authority..............................
  Minnesota Higher Education Coordinating   $60 million
   Board..................................
  New Hampshire Higher Education and        $39 million
   Health Facilities Authority............
  New York Dormitory Authority............  $120 million
  Pennsylvania Higher Education Assistance  $300 million
   Agency.................................
  Georgia Private Colleges and University   $31 million
   Authority..............................
  Wisconsin State Building Commission.....  $60 million
  South Dakota Health and Educational       $6 million
   Facilities Authority...................


        ``(B) Pennsylvania higher education assistance agency.--
    Subparagraph (A) shall apply to obligations issued by the 
    Pennsylvania Higher Education Assistance Agency only if such 
    obligations are issued solely for the purpose of refunding student 
    loan bonds outstanding on March 15, 1984.
    ``(3) Certain tax-exempt mortgage subsidy bonds.--For purposes of 
applying section 103(o) of the Internal Revenue Code of 1986 [formerly 
I.R.C. 1954], the term `consumer loan bond' shall not include any 
mortgage subsidy bond (within the meaning of section 103A(b) of such 
Code) to which the amendments made by section 1102 of the Mortgage 
Subsidy Bond Tax Act of 1980 [enacting section 103A of this title] do 
not apply.
    ``(4) Refunding exception.--The amendments made by this section 
[amending this section] shall not apply to any obligation or series of 
obligations the proceeds of which are used exclusively to refund 
obligations issued before March 15, 1984, except that--
        ``(A) the amount of the refunding obligations may not exceed 101 
    percent of the aggregate face amount of the refunded obligations, 
    and
        ``(B) the maturity date of any refunding obligation may not be 
    later than the date which is 17 years after the date on which the 
    refunded obligation was issued (or, in the case of a series of 
    refundings, the date on which the original obligation was issued).
    ``(5) Exception for certain established programs.--The amendments 
made by this section [amending this section] shall not apply to any 
obligation substantially all of the proceeds of which are used to carry 
out a program established under State law which has been in effect in 
substantially the same form during the 30-year period ending on the date 
of enactment of this Act [July 18, 1984], but only if such proceeds are 
used to make loans or to fund similar obligations--
        ``(A) in the same manner in which,
        ``(B) in the same (or lesser) amount per participant, and
        ``(C) for the same purposes for which,
such program was operated on March 15, 1984. This subparagraph shall not 
apply to obligations issued on or after March 15, 1987.
    ``(6) Certain bonds for renewable energy property.--The amendments 
made by this section [amending this section] shall not apply to any 
obligations described in section 243 of the Crude Oil Windfall Profit 
Tax Act of 1980 [Pub. L. 96-223, set out as a note below].
    ``(7) Exception for certain downtown redevelopment project.--The 
amendments made by this section [amending this section] shall not apply 
to any obligation which is issued as part of an issue 95 percent or more 
of the proceeds of which are to be used to provide a project to acquire 
and redevelop a downtown area if--
        ``(A) on August 15, 1985, a downtown redevelopment authority 
    adopted a resolution to issue obligations for such project,
        ``(B) before September 26, 1985, the city expended, or entered 
    into binding contracts to expend, more than $10,000,000 in 
    connection with such project, and
        ``(C) the State supreme court issued a ruling regarding the 
    proposed financing structure for such project on December 11, 1985.
The aggregate face amount of obligations to which this paragraph applies 
shall not exceed $85,000,000 and such obligations must be issued before 
January 1, 1992.''
    Section 631 of Pub. L. 98-369, as amended by Pub. L. 99-514, Sec. 2, 
title XIII, Secs. 1316(j), 1317(43), title XVIII, Sec. 1872(a)-(c)(1), 
Oct. 22, 1986, 100 Stat. 2095, 2670, 2708, 2891, 2892; Pub. L. 100-647, 
title I, Sec. 1013(f)(8), (g)(40), Nov. 10, 1988, 102 Stat. 3549, 3557, 
provided that:
    ``(a) Private Activity Bond Cap.--
        ``(1) In general.--Except as otherwise provided in this 
    subsection, the amendment made by section 621 [amending this 
    section] shall apply to obligations issued after December 31, 1983.
        ``(2) Inducement resolution before june 19, 1984.--The amendment 
    made by section 621 shall not apply to any issue of obligations if--
            ``(A) there was an inducement resolution (or other 
        comparable preliminary approval) for the issue before June 19, 
        1984, and
            ``(B) the issue is issued before January 1, 1985.
        ``(3) Certain projects preliminarily approved before october 19, 
    1983, given approval.--If--
            ``(A) there was an inducement resolution (or other 
        comparable preliminary approval) for a project before October 
        19, 1983, by any issuing authority,
            ``(B) a substantial user of such project notifies the 
        issuing authority within 30 days after the date of the enactment 
        of this Act [July 18, 1984] that it intends to claim its rights 
        under this paragraph, and
            ``(C) construction of such project began before October 19, 
        1983, or the substantial user was under a binding contract on 
        such date to incur significant expenditures with respect to such 
        project,
    such issuing authority shall allocate its share of the limitation 
    under section 103(n) of such Code for the calendar year during which 
    the obligations were to be issued pursuant to such resolution (or 
    other approval) first to such project. If the amount of obligations 
    required by all projects which meet the requirements of the 
    preceding sentence exceeds the issuing authority's share of the 
    limitation under section 103(n) of such Code, priority under the 
    preceding sentence shall be provided first to those projects for 
    which substantial expenditures were incurred before October 19, 
    1983. If any issuing authority fails to meet the requirements of 
    this paragraph, the limitation under section 103(n) of such Code for 
    the issuing authority for the calendar year following such failure 
    shall be reduced by the amount of obligations with respect to which 
    such failure occurred.
        ``(3) [(4)] Exception for certain bonds for a convention center 
    and resource recovery project.--In the case of any city, if--
            ``(A) the city council of such city authorized a feasibility 
        study for a convention center on June 10, 1982, and
            ``(B) on November 4, 1983, a municipal authority acting for 
        such city accepted a proposal for the construction of a facility 
        that is capable of generating steam and electricity through the 
        combustion of municipal waste,
    the amendment made by section 621 shall not apply to any issue, 
    issued during 1984, 1985, 1986, or 1987 and substantially all of the 
    proceeds of which are to be used to finance the convention center 
    (or access ramps and parking facilities therefor) described in 
    subparagraph (A) or the facility described in subparagraph (B).
    ``(b) Property Financed With Tax-Exempt Bonds Required To Be 
Depreciated on Straight-Line Basis.--
        ``(1) In general.--Except as otherwise provided in this section, 
    the amendments made by section 628(b) [amending section 168 of this 
    title] shall apply to property placed in service after December 31, 
    1983, to the extent such property is financed by the proceeds of an 
    obligation (including a refunding obligation) issued after October 
    18, 1983.
        ``(2) Exceptions.--
            ``(A) Construction or binding agreement.--The amendments 
        made by section 628(b) shall not apply with respect to 
        facilities--
                ``(i) the original use of which commences with the 
            taxpayer and the construction, reconstruction, or 
            rehabilitation of which began before October 19, 1983, or
                ``(ii) with respect to which a binding contract to incur 
            significant expenditures was entered into before October 19, 
            1983.
            ``(B) Refunding.--
                ``(i) In general.--Except as provided in clause (ii), in 
            the case of property placed in service after December 31, 
            1983, which is financed by the proceeds of an obligation 
            which is issued solely to refund another obligation which 
            was issued before October 19, 1983, the amendments made by 
            section 628(b) shall apply only with respect to an amount 
            equal to the basis in such property which has not been 
            recovered before the date such refunded obligation is 
            issued.
                ``(ii) Significant expenditures.--In the case of 
            facilities the original use of which commences with the 
            taxpayer and with respect to which significant expenditures 
            are made before January 1, 1984, the amendments made by 
            section 628(b) shall not apply with respect to such 
            facilities to the extent such facilities are financed by the 
            proceeds of an obligation issued solely to refund another 
            obligation which was issued before October 19, 1983.
            ``(C) Facilities.--In the case of an inducement resolution 
        or other comparable preliminary approval adopted by an issuing 
        authority before October 19, 1983, for purposes of applying 
        subparagraphs (A)(i) and (B)(ii) with respect to obligations 
        described in such resolution, the term `facilities' means the 
        facilities described in such resolution.
    ``(c) Other Provisions Relating to Tax-Exempt Bonds.--
        ``(1) In general.--Except as otherwise provided in this 
    subtitle, the amendments made by sections 622, 623, 627, and 628(c), 
    (d), and (e) (and the provisions of sections 625(c), 628(f), and 
    629(b)) [amending this section and enacting provisions set out as 
    notes under this section] shall apply to obligations issued after 
    December 31, 1983.
        ``(2) Obligations invested in federally insured deposits.--
    Notwithstanding any other provision of this section, clause (ii) of 
    section 103(h)(2)(B) of the Internal Revenue Code of 1986 [formerly 
    I.R.C. 1954] (as amended by this subtitle) shall apply to 
    obligations issued after April 14, 1983; except that such clause 
    shall not apply to any obligation issued pursuant to a binding 
    contract in effect on March 4, 1983.
        ``(3) Exceptions.--
            ``(A) Construction or binding agreement.--The amendments 
        (and provisions) referred to in paragraph (1) shall not apply to 
        obligations with respect to facilities--
                ``(i) the original use of which commences with the 
            taxpayer and the construction, reconstruction, or 
            rehabilitation of which began before October 19, 1983, and 
            was completed on or after such date,
                ``(ii) the original use of which commences with the 
            taxpayer and with respect to which a binding contract to 
            incur significant expenditures for construction, 
            reconstruction, or rehabilitation was entered into before 
            October 19, 1983, and some of such expenditures are incurred 
            on or after such date, or
                ``(iii) acquired after October 19, 1983, pursuant to a 
            binding contract entered into on or before such date.
            ``(B) Facilities.--Subparagraph (C) of subsection (b)(2) 
        shall apply for purposes of subparagraph (A) of this paragraph.
            ``(C) Exception.--Subparagraph (A) shall not apply with 
        respect to the amendment made by section 628(e) and the 
        provisions of sections 628(f) and 629(b) [amending this section 
        and enacting provisions set out as notes under this section].
        ``(4) Repeal of advance refunding of qualified public 
    facilities.--The amendment made by section 628(g) [amending this 
    section] shall apply to refunding obligations issued after the date 
    of the enactment of this Act [July 18, 1984]; except that if 
    substantially all the proceeds of the refunded issue were used to 
    provide airports or docks, such amendment shall only apply to 
    refunding obligations issued after December 31, 1984. In the case of 
    refunding obligations not to exceed $100,000,000 issued after 
    October 21, 1986, by Dade County, Florida, for the purpose of 
    advance refunding its Aviation Revenue Bonds (Series J), the first 
    sentence of this paragraph shall be applied by substituting `the 
    date which is 1 year after the date of the enactment of the 
    Technical and Miscellaneous Revenue Act of 1988 [Nov. 10, 1988]' for 
    `December 31, 1984' and the amendments made by section 1301 of the 
    Tax Reform Act of 1986 [section 1301 of Pub. L. 99-514, enacting 
    sections 141 to 150 and 7703 of this title, amending this section 
    and sections 2, 22, 25, 32, 86, 105, 152, 153, 163, 194, 269A, 414, 
    879, 1398, 3402, 4701, 4940, 4942, 4988, 6362, 6652, and 7871 of 
    this title, repealing section 103A of this title, enacting 
    provisions set out as notes under sections 141 and 148 of this 
    title, and amending provisions set out as a note under section 103A 
    of this title] shall not apply. In the case of refunding obligations 
    not exceeding $100,000,000 issued by the Alabama State Docks 
    Department, the first sentence of this paragraph shall be applied by 
    substituting `December 31, 1987' for `December 31, 1984' and the 
    Internal Revenue Code of 1986 shall be applied without regard to 
    section 149(d)(2)..[sic]
        ``(5) Special rule for health club facilities.--In the case of 
    any health club facility, with respect to the amendment made by 
    section 627(c) [amending this section]--
            ``(A) paragraph (1) shall be applied by substituting `April 
        12, 1984' for `December 31, 1983', and
            ``(B) paragraph (3) shall be applied by substituting `April 
        13, 1984' for `October 19, 1983' each place it appears.
    ``(d) Provisions of This Subtitle Not To Apply to Certain 
Property.--The amendments made by this subtitle [sections 621-632 of 
Pub. L. 98-369, amending this section and sections 103A and 168 of this 
title and enacting provisions set out as notes under this section] shall 
not apply to any property (and shall not apply to obligations issued to 
finance such property) if such property is described in any of the 
following paragraphs:
        ``(1) Any property described in paragraph (5), (6), or (7) of 
    section 31(g) of this Act [set out as an Effective Date of 1984 
    Amendment note under section 168 of this title].
        ``(2) Any property described in paragraph (4), (8), or (17) of 
    section 31(g) of this Act [set out as an Effective Date of 1984 
    Amendment note under section 168 of this title] but only if the 
    obligation is issued before January 1, 1985, and only if before June 
    19, 1984, the issuer had evidenced an intent to issue obligations 
    exempt from taxation under the Internal Revenue Code of 1986 in 
    connection with such property.
        ``(3) Any property described in paragraph (3) of section 216(b) 
    of the Tax Equity and Fiscal Responsibility Act of 1982 [set out as 
    an Effective Date of 1982 Amendment note under section 168 of this 
    title].
        ``(4) Any solid waste disposal facility described in section 
    103(b)(4)(E) of the Internal Revenue Code of 1986 if--
            ``(A) a State public authority created pursuant to State 
        legislation which took effect on June 18, 1973, took formal 
        action before October 19, 1983, to commit development funds for 
        such facility.
            ``(B) such authority issues obligations for any such 
        facility before January 1, 1987, and
            ``(C) expenditures have been made for the development of any 
        such facility before October 19, 1983.
        ``(5) Any solid waste disposal facility described in section 
    103(b)(4)(E) of the Internal Revenue Code of 1986 [formerly I.R.C. 
    1954] if--
            ``(A) a city government, by resolutions adopted on April 10, 
        1980, and December 27, 1982, took formal action to authorize the 
        submission of a proposal for a feasibility study for such 
        facility and to authorize the presentation to the Department of 
        the Army (U.S. Army Missile Command) of a proposed agreement to 
        jointly pursue construction and operation of such facility,
            ``(B) such city government (or a public authority on its 
        behalf) issues obligations for such facility before January 1, 
        1988, and
            ``(C) expenditures have been made for the development of 
        such facility before October 19, 1983. Notwithstanding the 
        foregoing provisions of this subsection, the amendments made by 
        section 624 [amending sections 103 and 103A of this title and 
        enacting provisions set out as a note under this section] 
        (relating to arbitrage) shall apply to obligations issued to 
        finance property described in paragraph (5).
    ``(e) Determination of Significant Expenditure.--
        ``(1) In general.--For purposes of this section, the term 
    `significant expenditures' means expenditures which equal or exceed 
    the lesser of--
            ``(A) $15,000,000, or
            ``(B) 20 percent of the estimated cost of the facilities.
        ``(2) Certain grants treated as expenditures.--For purposes of 
    paragraph (1), the amount of any UDAG grant preliminarily approved 
    on May 5, 1981, or April 4, 1983, shall be treated as an expenditure 
    with respect to the facility for which such grant was so approved.
    ``(f) Exceptions for Certain Other Amendments.--If--
        ``(1) there was an inducement resolution (or other comparable 
    preliminary approval) for an issue before June 19, 1984, by any 
    issuing authority, and
        ``(2) such issue is issued before January 1, 1985, the following 
    amendments shall not apply:
            ``(A) the amendments made by section 623 [amending this 
        section],
            ``(B) the amendments made by subsections (a) and (b) of 
        section 627 [amending this section] (except to the extent such 
        amendments relate to farm land),
            ``(C) in the case of a race track, the amendment made by 
        section 627(c) [amending this section], and
            ``(D) the amendments made by section 628(c) [amending this 
        section].''
    [Section 1872(a)(2)(B) of Pub. L. 99-514 provided that the amendment 
of section 631(c)(3) of Pub. L. 98-369, set out above, made by section 
1872(a)(2)(B) of Pub. L. 99-514 is effective with respect to obligations 
issued after Mar. 28, 1985.]


                    Effective Date of 1983 Amendment

    For effective date of amendment by Pub. L. 97-473, see section 
204(2) of Pub. L. 97-473, set out as an Effective Date note under 
section 7871 of this title.


                    Effective Date of 1982 Amendment

    Section 214(f) of Pub. L. 97-248 provided that:
    ``(1) Composite issues; small issue exemption.--The amendments made 
by subsections (a) and (b) [amending this section] shall apply to 
obligations issued after the date of the enactment of this Act [Sept. 3, 
1982].
    ``(2) Termination.--The amendment made by subsection (c) [amending 
this section] shall take effect on the date of the enactment of this Act 
[Sept. 3, 1982].
    ``(3) Research expenditures.--The amendment made by subsection (d) 
[amending this section] shall apply with respect to expenditures made 
after the date of the enactment of this Act [Sept. 3, 1982].
    ``(4) Certain facilities.--The amendment made by subsection (e) 
[amending this section] shall apply to obligations issued after December 
31, 1982.''
    Section 215(c) of Pub. L. 97-248 provided that:
    ``(1) Public approval.--The amendment made by subsection (a) 
[amending this section] shall apply to obligations issued after December 
31, 1982, other than obligations issued solely to refund any obligation 
which--
        ``(A) was issued before July 1, 1982, and
        ``(B) has a maturity which does not exceed 3 years.
    ``(2) Information reporting.--The amendments made by subsection (b) 
[amending this section] shall apply to obligations issued after December 
31, 1982 (including any obligation issued to refund an obligation issued 
before such date).''
    Section 217(e) of Pub. L. 97-248, as amended by Pub. L. 98-369, div. 
A, title VII, Sec. 712(h), July 18, 1984, 98 Stat. 947; Pub. L. 99-514, 
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ``The amendments 
made by this section [amending this section] shall apply to obligations 
issued after the date of the enactment of this Act [Sept. 3, 1982]. For 
purposes of applying section 168(f)(8)(D)(v) of the Internal Revenue 
Code of 1986 [formerly I.R.C. 1954], the amendments made by subsection 
(c) [amending this section] shall apply to agreements entered into after 
the date of the enactment of this Act.''
    Section 219(b) of Pub. L. 97-248 provided that: ``The amendment made 
by subsection (a) [amending this section] shall apply to obligations 
issued after December 31, 1982.''
    Section 221(d) of Pub. L. 97-248 provided that:
    ``(1) In general.--Except as provided in paragraph (2), the 
amendments made by this section [amending this section and section 1104 
of Pub. L. 96-499, formerly set out as a note under section 103A of this 
title] shall apply to obligations issued after the date of the enactment 
of this Act [Sept. 3, 1982].
    ``(2) Exception.--The amendments made by this section shall not 
apply with respect to any obligation to which the amendments made by 
section 1103 of the Mortgage Subsidy Bond Tax Act of 1980 [section 1103 
of Pub. L. 96-499, amending this section] do not apply by reason of 
section 1104 of such Act [section 1104 of Pub. L. 96-499, formerly set 
out as a note under section 103A of this title].''
    Section 310(d) of Pub. L. 97-248, as amended by Pub. L. 97-448, 
title III, Sec. 306(b)(2), 96 Stat. 2405; Pub. L. 98-216, Sec. 6(b), 
Feb. 14, 1984, 98 Stat. 8; Pub. L. 99-514, Sec. 2, Oct. 22, 1986, 100 
Stat. 2095, provided that:
    ``(1) In general.--Except as otherwise provided in this subsection, 
the amendments made by this section [enacting section 4701 of this title 
and section 757c-5 of former Title 31, Money and Finance, and amending 
this section and sections 103A, 163, 165, 312, and 1232 of this title] 
shall apply to obligations issued after December 31, 1982.
    ``(2) [Repealed. Pub. L. 98-216, Sec. 6(b), Feb. 14, 1984, 98 Stat. 
8.]
    ``(3) Exception for certain warrants, etc.--The amendments made by 
subsection (b) [enacting section 4701 of this title and amending this 
section and sections 163, 165, 312, and 1232 of this title] shall not 
apply to any obligations issued after December 31, 1982, on the exercise 
of a warrant or the conversion of a convertible obligation if such 
warrant or obligation was offered or sold outside the United States 
without registration under the Securities Act of 1933 [15 U.S.C. 77a et 
seq.] and was issued before August 10, 1982. A rule similar to the rule 
of the preceding sentence shall also apply in the case of any 
regulations issued under section 163(f)(2)(C) of the Internal Revenue 
Code of 1986 [formerly I.R.C. 1954] (as added by this section) except 
that the date on which such regulations take effect shall be substituted 
for `August 10, 1982'.
    ``(4) [Repealed. Pub. L. 98-216, Sec. 6(b), Feb. 14, 1984, 98 Stat. 
8.]''


                    Effective Date of 1981 Amendment

    Section 811(c) of Pub. L. 97-34 provided that: ``The amendments made 
by this section [amending this section] shall apply to obligations 
issued after the date of the enactment of this Act [Aug. 13, 1981].''
    Section 812(b)(1) of Pub. L. 97-34 provided that: ``The amendment 
made by subsection (a) [amending this section] shall apply to 
obligations issued after December 31, 1980.''


                    Effective Date of 1980 Amendments

    For effective date of amendment by Pub. L. 96-499, see section 1104 
of Pub. L. 96-499, set out as an Effective Date note under section 103A 
of this title.
    Section 241(d) of Pub. L. 96-223 provided that: ``The amendments 
made by subsection (a) [amending this section] and the provisions of 
subsections (b) and (c) [set out as notes under this section] shall 
apply with respect to obligations issued after October 18, 1979.''
    Section 242(c) of Pub. L. 96-223 provided that: ``The amendments 
made by subsection (a) [amending this section] and the provisions of 
subsection (b) [set out as a note under this section] shall apply with 
respect to obligations issued after October 18, 1979.''
    Section 244(b) of Pub. L. 96-223 provided that: ``The amendments 
made by subsection (a) [amending this section] shall apply to 
obligations issued on or after October 18, 1979.''


                    Effective Date of 1978 Amendments

    Section 201(c) of Pub. L. 95-339 provided that: ``The amendments 
made by subsection (a) [amending this section] shall apply to taxable 
years ending after the date of the enactment of this Act [Aug. 8, 
1978].''
    Section 331(c) of Pub. L. 95-600 provided that:
    ``(1) The amendments made by subsection (a) [amending this section] 
shall apply to--
        ``(A) obligations issued after December 31, 1978, in taxable 
    years ending after such date, and
        ``(B) capital expenditures made after December 31, 1978, with 
    respect to obligations issued before January 1, 1979.
    ``(2) The amendment made by subsection (b) [amending this section] 
shall apply to--
        ``(A) obligations issued after September 30, 1979, in taxable 
    years ending after such date, and
        ``(B) capital expenditures made after September 30, 1979, with 
    respect to obligations issued after such date.''
    Section 332(b) of Pub. L. 95-600 provided that: ``The amendment made 
by subsection (a) [amending this section] shall apply to taxable years 
ending after April 30, 1968, but only with respect to obligations issued 
after such date.''
    Section 333(b) of Pub. L. 95-600 provided that: ``The amendment made 
by subsection (a) [amending this section] shall apply to obligations 
issued after the date of the enactment of this Act [Nov. 6, 1978] in 
taxable years ending after such date.''
    Section 334(c) of Pub. L. 95-600 provided that: ``The amendments 
made by this section [amending this section] shall apply to obligations 
issued after the date of the enactment of this Act [Nov. 6, 1978].''
    Section 703(q)(2) of Pub. L. 95-600 provided that: ``The amendments 
made by paragraph (1) [amending this section] shall apply with respect 
to payments made by the Commissioner of Education after December 31, 
1976.''
    Amendment by section 703(j)(1) of Pub. L. 95-600 effective on Oct. 
4, 1976, see section 703(r) of Pub. L. 95-600, set out as a note under 
section 46 of this title.


                    Effective Date of 1976 Amendment

    Amendment by section 1901(a)(17), (b)(8)(B) of Pub. L. 94-455 
applicable with respect to taxable years ending after Oct. 4, 1976, see 
section 1901(d) of Pub. L. 94-455, set out as a note under section 2 of 
this title.
    Amendment by section 1906(b)(13)(A) of Pub. L. 94-455 effective Feb. 
1, 1977, see section 1906(d)(1) of Pub. L. 94-455, set out as a note 
under section 6013 of this title.
    Section 2105(d) of Pub. L. 94-455 provided that: ``The amendments 
made by this section [amending this section] apply to obligations issued 
on or after the date of the enactment of this Act [Oct. 4, 1976].''
    Amendment by section 2137(d) of Pub. L. 94-455 applicable to taxable 
years beginning after Dec. 31, 1975, see section 2137(e) of Pub. L. 94-
455, set out as a note under section 852 of this title.


                    Effective Date of 1975 Amendments

    Section 301(b) of Pub. L. 94-182 provided that: ``The amendment made 
by subsection (a) [amending this section] shall apply to obligations 
issued after the date of the enactment of this Act [Dec. 31, 1975].''
    Section 7(b) of Pub. L. 94-164 provided that: ``The amendments made 
by this section [amending this section] shall apply to obligations 
issued after the date of enactment of this Act [Dec. 23, 1975].''


                    Effective Date of 1971 Amendment

    Section 315(c) of Pub. L. 92-178 provided that: ``The amendments 
made by subsection (a) [amending this section] shall apply with respect 
to obligations issued after January 1, 1969. The amendment made by 
subsection (b) [amending this section] shall apply with respect to 
expenditures incurred after the date of the enactment of this Act [Dec. 
10, 1971].''


                    Effective Date of 1969 Amendment

    Section 601(b) of Pub. L. 91-172 provided that: ``The amendments 
made by subsection (a) [amending this section] shall apply with respect 
to obligations issued after October 9, 1969.''


                    Effective Date of 1968 Amendment

    Section 401(b) of Pub. L. 90-634 provided that: ``The amendment made 
by subsection (a) [amending this section] shall apply with respect to 
obligations issued after the date of the enactment of this Act [Oct. 24, 
1968].''
    Section 107(b)(1) of Pub. L. 90-364 provided that: ``Except as 
provided by paragraph (2) [set out as a note below], the amendment made 
by subsection (a) [amending this section] shall apply to taxable years 
ending after April 30, 1968, but only with respect to obligations issued 
after such date.''

                          Transfer of Functions

    Functions of Commissioner of Education transferred to Secretary of 
Education by section 3441(a)(1) of Title 20, Education.


 Coordination of Certain Amendments Made by Pub. L. 97-424 and Pub. L. 
                                 97-473

    Section 722(b) of Pub. L. 98-369 provided that: ``For purposes of 
applying the amendments made by section 547 of the Highway Revenue Act 
of 1982 [Pub. L. 97-424, amending this section] and the amendment made 
by section 202(b)(2) of Public Law 97-473 [amending this section], 
Public Law 97-473 shall be deemed to have been enacted immediately 
before the Highway Revenue Act of 1982.''


                 Validation of Sinking Fund Regulations

    Section 1013(a)(35) of Pub. L. 100-647 provided that:
    ``(A) Treasury Regulation section 1.103-13(g) (1979) is hereby 
enacted into positive law.
    ``(B)(i) Except as provided in clause (ii), subparagraph (A) shall 
apply to obligations sold after May 2, 1978, and to which such 
regulation was provided to apply.
    ``(ii) Treasury Regulation section 1.103-13(g) (1979) as enacted 
into positive law by subparagraph (A) shall cease to apply to the extent 
hereafter modified by the Secretary of the Treasury or his delegate by 
regulations.''


          Bonds Issued To Refund Subsection (o)(3) Obligations

    Section 1013(c)(15) of Pub. L. 100-647 provided that: ``A bond 
issued to refund an obligation described in section 103(o)(3) of the 
Internal Revenue Code of 1954 (as in effect on the day before the date 
of the enactment of the Tax Reform Act of 1986 [Oct. 22, 1986]) shall 
not be treated as described in section 144(b) of the 1986 Code unless it 
is described in section 144(b)(1)(A) of the 1986 Code.''


           Plan Amendments Not Required Until January 1, 1989

    For provisions directing that if any amendments made by subtitle A 
or subtitle C of title XI [Secs. 1101-1147 and 1171-1177] or title XVIII 
[Secs. 1800-1899A] of Pub. L. 99-514 require an amendment to any plan, 
such plan amendment shall not be required to be made before the first 
plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. 
L. 99-514, as amended, set out as a note under section 401 of this 
title.


     Treatment of Certain Guarantees by Farmers Home Administration

    Section 1865(b) of Pub. L. 99-514 provided that: ``An obligation 
shall not be treated as federally guaranteed for purposes of section 
103(h) of the Internal Revenue Code of 1954 [now 1986] by reason of a 
guarantee by the Farmers Home Administration if--
        ``(1) such guarantee is pursuant to a commitment made by the 
    Farmers Home Administration before July 1, 1984, and
        ``(2) such obligation is issued to finance a convention center 
    project in Carbondale, Illinois.''


 Treatment of Certain Obligations Used To Finance Solid Waste Disposal 
                                Facility

    Section 1865(c) of Pub. L. 99-514 provided that:
    ``(1) In general.--Any obligation which is part of an issue a 
substantial portion of the proceeds of which is to be used to finance a 
solid waste disposal facility described in paragraph (2) shall not, for 
purposes of section 103(h) of the Internal Revenue Code of 1954 [now 
1986], be treated as an obligation which is federally guaranteed by 
reason of the sale of fuel, steam, electricity, or other forms of usable 
energy to the Federal Government or any agency or instrumentality 
thereof.
    ``(2) Solid waste disposal facility.--A solid waste disposal 
facility is described in this paragraph if such facility is described in 
section 103(b)(4)(E) of such Code and--
        ``(A) if--
            ``(i) a public State authority created pursuant to State 
        legislation which took effect on July 1, 1980, took formal 
        action before October 19, 1983, to commit development funds for 
        such facility,
            ``(ii) such authority issues obligations for such facility 
        before January 1, 1988, and
            ``(iii) expenditures have been made for the development of 
        such facility before October 19, 1983,
        ``(B) if--
            ``(i) such facility is operated by the South Eastern Public 
        Service Authority of Virginia, and
            ``(ii) on December 20, 1984, the Internal Revenue Service 
        issued a ruling concluding that a portion of the obligations 
        with respect to such facility would not be treated as federally 
        guaranteed under section 103(h) of such Code by reason of the 
        transitional rule contained in section 631(c)(3)(A)(i) of the 
        Tax Reform Act of 1984 [section 631(c)(3)(A)(i) of Pub. L. 98-
        369, set out as a note above],
        ``(C) if--
            ``(i) a political subdivision of a State took formal action 
        on April 1, 1980, to commit development funds for such facility,
            ``(ii) such facility has a contract to sell steam to a naval 
        base,
            ``(iii) such political subdivision issues obligations for 
        such facility before January 1, 1988, and
            ``(iv) expenditures have been made for the development of 
        such facility before October 19, 1983, or
        ``(D) if--
            ``(i) such facility is a thermal transfer facility,
            ``(ii) is to be built and operated by the Elk Regional 
        Resource Authority, and
            ``(iii) is to be on land leased from the United States Air 
        Force at Arnold Engineering Development Center near Tullahoma, 
        Tennessee.
    ``(3) Limitations.--
        ``(A) In the case of a solid waste disposal facility described 
    in paragraph (2)(A), the aggregate face amount of obligations to 
    which paragraph (1) applies shall not exceed $65,000,000.
        ``(B) In the case of a solid waste disposal facility described 
    in paragraph (2)(B), the aggregate face amount of obligations to 
    which paragraph (1) applies shall not exceed $20,000,000. Such 
    amount shall be in addition to the amount permitted under the 
    Internal Revenue Service ruling referred to in paragraph (2)(B)(ii).
        ``(C) In the case of a solid waste disposal facility described 
    in paragraph (2)(C), the aggregate face amount of obligations to 
    which paragraph (1) applies shall not exceed $75,000,000.
        ``(D) In the case of a solid waste disposal facility described 
    in paragraph (2)(D), the aggregate face amount of obligations to 
    which paragraph (1) applies shall not exceed $25,000,000.''


          Transitional Rule for Limit on Small Issue Exception

    Section 1866 of Pub. L. 99-514, as amended by Pub. L. 100-647, title 
I, Sec. 1018(m)(1)-(4), Nov. 10, 1988, 102 Stat. 3584, provided that: 
``The amendment made by section 623 of the Tax Reform Act of 1984 
[section 623 of Pub. L. 98-369, amending this section] shall not apply 
to any obligation (or series of obligations) issued to refund another 
tax-exempt IDB to which the amendment made by such section 623 did not 
apply if--
        ``(1) the average maturity of the issue of which the refunding 
    obligation is a part does not exceed the average maturity of the 
    obligations to be refunded by such issue,
        ``(2) the amount of the refunding obligation does not exceed the 
    amount of the refunded obligation, and
        ``(3) the proceeds of the refunding obligation are used to 
    redeem the refunded obligation not later than 90 days after the date 
    of the issuance of the refunding obligation.
For purposes of the preceding sentence, the term `tax-exempt IDB' means 
any industrial development bond (as defined in section 103(b) of the 
Internal Revenue Code of 1954 [now 1986]) the interest on which is 
exempt from tax under section 103(a) of such Code. For purposes of 
paragraph (1), average maturity shall be determined in accordance with 
subsection (b)(14)(B)(i) of such Code.''
    [Section 1018(m)(5) of Pub. L. 100-647 provided that: ``A refunding 
obligation issued before July 1, 1987, shall be treated as meeting the 
requirement of paragraph (1) of section 1866 of the Reform Act [Pub. L. 
99-514, set out above] if such obligation met the requirement of such 
paragraph as enacted by the Reform Act [Pub. L. 99-514].'']


   Exception From 1984 Amendment for Downtown Muskogee Revitalization 
                                 Project

    Section 1867(b) of Pub. L. 99-514 provided that: ``The amendment 
made by section 624 of the Tax Reform Act of 1984 [amending sections 103 
and 103A of this title and enacting provisions set out as a note under 
this section] shall not apply to obligations issued with respect to the 
Downtown Muskogee Revitalization Project for which a UDAG grant was 
preliminarily approved on May 5, 1981, if--
        ``(1) such obligation is issued before January 1, 1986, or
        ``(2) such obligation is issued after such date to provide 
    additional financing for such project except that the aggregate 
    amount of obligations to which this subsection applies shall not 
    exceed $10,000,000.''


                           Transitional Rules

    Section 1869(c)(1)-(4) of Pub. L. 99-514, as amended by Pub. L. 100-
647, title I, Sec. 1018(n), Nov. 10, 1988, 102 Stat. 3584, provided 
that:
    ``(1) Treatment of certain obligations issued by the city of 
baltimore.--Obligations issued by the city of Baltimore, Maryland, after 
June 30, 1985, shall not be treated as private loan bonds for purposes 
of section 103(o) of the Internal Revenue Code of 1954 [now 1986] (or as 
private activity bonds for purposes of section 103 and part IV of 
subchapter A of chapter 1 of the Internal Revenue Code of 1986, as 
amended by title XIII of this Act [sections 1301 to 1318 of Pub. L. 99-
514]) by reason of the use of a portion of the proceeds of such 
obligations to finance or refinance temporary advances made by the city 
of Baltimore in connection with loans to persons who are not exempt 
persons (within the meaning of section 103(b)(3) of such Code) if--
        ``(A) such obligations are not industrial development bonds 
    (within the meaning of section 103(b)(2) of the Internal Revenue 
    Code of 1954 [now 1986]),
        ``(B) the portion of the proceeds of such obligations so used is 
    attributable to debt approved by voter referendum on or before 
    November 2, 1982,
        ``(C) the loans to such nonexempt persons were approved by the 
    Board of Estimates of the city of Baltimore on or before October 19, 
    1983, and
        ``(D) the aggregate amount of such temporary advances financed 
    or refinanced by such obligations does not exceed $27,000,000.
    ``(2) White pine power project.--The amendment made by section 
626(a) of the Tax Reform Act of 1984 [section 626(a) of Pub. L. 98-369, 
amending this section] shall not apply to any obligation issued during 
1984 to provide financing for the White Pine Power Project in Nevada.
    ``(3) Tax increment bonds.--The amendment made by section 626(a) of 
the Tax Reform Act of 1984 shall not apply to any tax increment 
financing obligation issued before August 16, 1986, if--
        ``(A) substantially all of the proceeds of the issue are to be 
    used to finance--
            ``(i) sewer, street, lighting, or other governmental 
        improvements to real property,
            ``(ii) the acquisition of any interest in real property (by 
        a governmental unit having the power to exercise eminent 
        domain), the preparation of such property for new use, or the 
        transfer of such interest to a private developer, or
            ``(iii) payments of reasonable relocation costs of prior 
        users of such real property,
        ``(B) all of the activities described in subparagraph (A) are 
    pursuant to a redevelopment plan adopted by the issuing authority 
    before the issuance of such issue,
        ``(C) repayment of such issue is secured exclusively by pledges 
    of that portion of any increase in real property tax revenues (or 
    their equivalent) attributable to the redevelopment resulting from 
    the issue (or similar issues), and
        ``(D) none of the property described in subparagraph (A) is 
    subject to a real property or other tax based on a rate or valuation 
    method which differs from the rate and valuation method applicable 
    to any other similar property located within the jurisdiction of the 
    issuing authority.
    ``(4) Eastern maine electric cooperative.--The amendment made by 
section 626(a) of the Tax Reform Act of 1984 shall not apply to 
obligations issued by Massachusetts Municipal Wholesale Electric Company 
Project No. 6 if--
        ``(A) such obligation is issued before January 1, 1986,
        ``(B) such obligation is issued after such date to refund a 
    prior obligation for such project, except that the aggregate amount 
    of obligations to which this subparagraph applies shall not exceed 
    $100,000,000, or
        ``(C) such obligation is issued after such date to provide 
    additional financing for such project except that the aggregate 
    amount of obligations to which this subparagraph applies shall not 
    exceed $45,000,000.
Subparagraph (B) shall not apply to any obligation issued for the 
advance refunding of any obligation.''


     Treatment of Obligations To Finance St. Johns River Power Park

    Section 1869(c)(6) of Pub. L. 99-514 provided that:
    ``(A) In general.--The amendment made by section 626(a) of the Tax 
Reform Act of 1984 [section 626(a) of Pub. L. 98-369, amending this 
section] shall not apply to any obligation issued to finance the project 
described in subparagraph (B) if--
        ``(i) such obligation is issued before September 27, 1985,
        ``(ii) such obligation is issued after such date to refund a 
    prior tax exemption obligation for such project, the amount of such 
    obligation does not exceed the outstanding amount of the refunded 
    obligation, and such prior tax exempt obligation is retired not 
    later than the date 30 days after the issuance of the refunding 
    obligation, or
        ``(iii) such obligation is issued after such date to provide 
    additional financing for such project except that the aggregate 
    amount of obligations to which this clause applies shall not exceed 
    $150,000,000.
Clause (ii) shall not apply to any obligation issued for the advance 
refunding of any obligation.
    ``(B) Description of project.--The project described in this 
subparagraph in the St. Johns River Power Park system in Florida which 
was authorized by legislation enacted by the Florida Legislature in 
February of 1982.''


   Certain Public Utilities Treated as Exempted Persons Under Section 
               103(b); Special Rules for Certain Railroads

    Section 629 of Pub. L. 98-369, as amended by Pub. L. 99-514, Sec. 2, 
title XIII, Sec. 1316(g)(8)(B), Oct. 22, 1986, 100 Stat. 2095, 2670, 
provided that:
    ``(a) Certain Public Utilities.--For purposes of applying section 
103(b)(3) of the Internal Revenue Code [of 1986] with respect to--
        ``(1) any obligations issued after the date of enactment of this 
    Act [July 18, 1984], and
        ``(2) any obligations issued after December 31, 1969, which were 
    treated as obligations described in section 103(a) of such Code on 
    the day on which such obligations were issued,
the term `exempt person' shall include a regulated public utility having 
any customer service area within a State served by a public power 
authority which was required as a condition of a Federal Power 
Commission license specified by an Act of Congress enacted prior to the 
enactment of section 107 of the Revenue and Expenditure Control Act of 
1968 (Public Law 90-364) [June 28, 1968] to contract to sell power to 
one such utility and which is authorized by State law to sell power to 
other such utilities, but only with respect to the purchase by any such 
utility and resale to its customers of any output of any electrical 
generation facility or any portion thereof or any use of any electrical 
transmission facility or any portion thereof financed by such power 
authority and owned by it or by such State, and provided that by 
agreement between such power authority and any such utility there shall 
be no markup in the resale price charged by such utility of that 
component of the resale price which represents the price paid by such 
utility for such output or use. The preceding sentence shall be applied 
by inserting `and a rural electric cooperative utility' after `regulated 
public utility' but only if not more than 1 percent of the load of the 
public power authority is sold to such rural electric cooperative 
utility.
    ``(b) Certain Railroads.--Section 103(b)(1) of the Internal Revenue 
Code of 1986 [formerly I.R.C. 1954] shall not apply to any obligation 
which is described in section 103(b)(6)(A) of such Code if--
        ``(1) substantially all of the proceeds of such obligation are 
    used to acquire railroad track and right-of-way from a railroad 
    involved in a title 11 or similar proceeding (within the meaning of 
    section 368(a)(3)(A) of such Code), and
        ``(2) the Federal Railroad Administration provides joint 
    financing for such acquisitions.
    ``(c) Special Rules for Subsection (a).--
        ``(1) Obligations subject to cap.--Any obligation described in 
    subsection (a) shall be treated as a private activity bond for 
    purposes of section 103(n) of the Internal Revenue Code of 1986.
        ``(2) Limitation on amount of obligations to which subsection 
    (a)(1) applies--The aggregate amount of obligations to which 
    subsection (a)(1) applies shall not exceed $911,000,000.
        ``(3) Limitation on purposes.--Subsection (a)(1) shall only 
    apply to obligations issued as part of an issue substantially all 
    the proceeds of which are used to provide 1 or more of the 
    following:
            ``(A) Cable facilities.
            ``(B) Small hydroelectric facilities.
            ``(C) The acquisition of an interest in an electrical 
        generating facility.
            ``(D) Improvements to existing generating facilities.
            ``(E) Transmission lines.
            ``(F) Electric generating facilities.''


  Treatment of Certain Residential Real Property as Residential Rental 
                                Property

    Treatment of Pub. L. 98-369, Sec. 631(d)(3), residential real 
property as residential rental property, see section 1809(a)(4)(C) of 
Pub. L. 99-514, set out as a note under section 168 of this title.


        Public Approval Requirement in the Case of Public Airport

    Section 628(f) of Pub. L. 98-369, as amended by Pub. L. 99-514, 
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ``If--
        ``(1) the proceeds of any issue are to be used to finance a 
    facility or facilities located on a public airport, and
        ``(2) the governmental unit issuing such obligations is the 
    owner or operator of such airport,
such governmental unit shall be deemed to be the only governmental unit 
having jurisdiction over such airport for purposes of subsection (k) of 
section 103 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954] 
(relating to public approval for industrial development bonds).''


  Small Issue Limit in Case of Certain Urban Development Action Grants

    Section 628(h) of Pub. L. 98-369, as amended by Pub. L. 99-514, 
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ``In the case of 
any obligation issued on December 11, 1981, section 103(b)(6)(I) of the 
Internal Revenue Code of 1986 [formerly I.R.C. 1954] shall be applied by 
substituting `$15,000,000' for `$10,000,000' if--
        ``(1) such obligation is part of an issue,
        ``(2) substantially all of the proceeds of such issue are used 
    to provide facilities with respect to which an urban development 
    action grant under section 119 of the Housing and Community 
    Development Act of 1974 [42 U.S.C. 5318] was preliminarily approved 
    by the Secretary of Housing and Urban Development on January 10, 
    1980, and
        ``(3) the Secretary of Housing and Urban Development determines, 
    at the time such grant is approved, that the amount of such grant 
    will equal or exceed 5 percent of the total capital expenditures 
    incurred with respect to such facilities.''


                           Student Loan Bonds

    Section 625 of Pub. L. 98-369, as amended by Pub. L. 99-514, Sec. 2, 
title XVIII, Sec. 1868, Oct. 22, 1986, 100 Stat. 2095, 2888, provided 
that:
    ``(a) Arbitrage Regulations.--
        ``(1) In general.--The Secretary shall prescribe regulations 
    which specify the circumstances under which a qualified student loan 
    bond shall be treated as an arbitrage bond for purposes of section 
    103 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954]. 
    Such regulations may provide that--
            ``(A) paragraphs (4) and (5) of section 103(c) of such Code 
        shall not apply, and
            ``(B) rules similar to section 103(c)(6) shall apply,
    to qualified student loan bonds.
        ``(2) Definitions.--For purposes of this subsection--
            ``(A) Qualified student loan bond.--The term `qualified 
        student loan bond' has the meaning given to such term by section 
        103(o)(3) of the Internal Revenue Code of 1986 (as amended by 
        this Act).
            ``(B) Arbitrage bond.--The term `arbitrage bond' has the 
        meaning given to such term by section 103(c)(2).
        ``(3) Effective date.--
            ``(A) In general.--Except as otherwise provided in this 
        paragraph, any regulations prescribed by the Secretary under 
        paragraph (1) shall apply to obligations issued after the 
        qualified date.
            ``(B) Qualified date.--
                ``(i) In general.--For purposes of this paragraph, the 
            term `qualified date' means the earlier of--
          ``(I) the date on which the Higher Education Act of 1965 [20 
                U.S.C. 1001 et seq.] expires, or
          ``(II) the date, after the date of enactment of this Act [July 
                18, 1984], on which the Higher Education Act of 1965 is 
                reauthorized.
                ``(ii) Publication of regulations.--Notwithstanding 
            clause (i), the qualified date shall not be a date which is 
            prior to the date that is 6 months after the date on which 
            the regulations prescribed under paragraph (1) are published 
            in the Federal Register.
            ``(C) Refunding obligations.--Regulations prescribed by the 
        Secretary under paragraph (1) shall not apply to any obligation 
        (or series of refunding obligations) issued exclusively to 
        refund any qualified student loan bond which was issued before 
        the qualified date, except that the requirements of 
        subparagraphs (A) and (B) of section 626(b)(4) of this Act [set 
        out in Effective Date of 1984 Amendment note above] must be met 
        with respect to such refunding.
            ``(D) Fulfillment of commitments.--Regulations prescribed by 
        the Secretary under paragraph (1) shall not apply to any 
        obligations which are needed to fulfill written commitments to 
        acquire or finance student loans which are originated after June 
        30, 1984, and before the qualified date, but only if--
                ``(i) such commitments are binding on the qualified 
            date, and
                ``(ii) the amount of such commitments is consistent with 
            practices of the issuer which were in effect on March 15, 
            1984, with respect to establishing secondary markets for 
            student loans.
    ``(b) Arbitrage Limitation on Student Loan Bonds Which Are Not 
Qualified Student Loan Bonds.--Under regulations prescribed by the 
Secretary of the Treasury or his delegate, any student loan bond (other 
than a qualified student loan bond) issued after December 31, 1985, 
shall be treated as an obligation not described in subsection (a)(1) or 
(2) of section 103 of the Internal Revenue Code of 1986 unless the issue 
of which such obligation is a part meets requirements similar to those 
of sections 103(c)(6) and 103A(i) of such Code.
    ``(c) Issuance of Student Loan Bonds Which Are Not Tax-Exempt.--Any 
issuer who may issue obligations described in section 103(a) of the 
Internal Revenue Code of 1986 may elect to issue student loan bonds 
which are not described in such section 103(a) of such Code without 
prejudice to--
        ``(1) the status of any other obligations issued, or to be 
    issued, by such issuer as obligations described in section 103(a) of 
    such Code, or
        ``(2) the status of the issuer as an organization exempt from 
    taxation under such Code.
    ``(d) Federal Executive Branch Jurisdiction Over Tax-Exempt 
Status.--For purposes of Federal law, any determination by the executive 
branch of the Federal Government of whether interest on any obligation 
is exempt from taxation under the Internal Revenue Code of 1986 shall be 
exclusively within the jurisdiction of the Department of the Treasury.
    ``(e) Study on Tax-Exempt Student Loan Bonds.--
        ``(1) In general.--The Comptroller General of the United States 
    and the Director of the Congressional Budget Office, shall conduct 
    studies of--
            ``(A) the appropriate role of tax-exempt bonds which are 
        issued in connection with the guaranteed student loan program 
        and the PLUS program established under the Higher Education Act 
        of 1965 [20 U.S.C. 1001 et seq.], and
            ``(B) the appropriate arbitrage rules for such bonds.
        ``(2) Report.--The Comptroller General of the United States and 
    the Director of the Congressional Budget Office, shall submit to the 
    Committee on Finance and the Committee on Labor and Human Resources 
    of the Senate and the Committee on Ways and Means and the Committee 
    on Education and Labor of the House of Representatives reports on 
    the studies conducted under paragraph (1) by no later than 9 months 
    after the date of enactment of this Act [July 18, 1984].''


  Obligations Issued To Provide Solid Waste-Energy Producing Facilities

    Section 241(b) of Pub. L. 96-223, as amended by Pub. L. 99-514, 
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
    ``(1) General rule.--For purposes of section 103 of the Internal 
Revenue Code of 1986 [formerly I.R.C. 1954], any obligation issued by an 
authority for 2 or more political subdivisions of a State which is part 
of an issue substantially all of the proceeds of which are to be used to 
provide solid waste-energy producing facilities shall be treated as an 
obligation of a political subdivision of a State which meets the 
requirements of section 103(b)(4)(E) of such Code (relating to solid 
waste disposal, etc., facilities). Nothing in the preceding sentence 
shall be construed to override the limitations of section 103(c) of such 
Code (relating to arbitrage bonds).
    ``(2) Solid waste-energy producing facilities.--For purposes of 
paragraph (1), the term `solid waste-energy producing facilities' means 
any solid waste disposal facility and any facility for the production of 
steam and electrical energy if--
        ``(A) substantially all of the fuel for the facility producing 
    steam and electrical energy is derived from solid waste from such 
    solid waste disposal facility,
        ``(B) both such solid waste disposal facility and the facility 
    producing steam and electrical energy are owned and operated by the 
    authority referred to in paragraph (1), and
        ``(C) all of the electrical energy and steam produced by the 
    facility for producing steam and electricity which is not used by 
    such facility is sold, for purposes other than resale, to an agency 
    or instrumentality of the United States.
    ``(3) Solid waste disposal facility.--For purposes of paragraph (2), 
the term `solid waste disposal facility' means any solid waste disposal 
facility within the meaning of section 103(b)(4)(E) of the Internal 
Revenue Code of 1986 (determined without regard to section 103(g) of 
such Code).
    ``(4) Obligations must be in registered form.--This subsection shall 
not apply to any obligation which is not issued in registered form.''


                      Alcohol-Producing Facilities

    Section 241(c) of Pub. L. 96-223, as amended by Pub. L. 99-514, 
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
    ``(1) In general.--Subparagraph (C) of section 103(g)(3) of the 
Internal Revenue Code of 1986 [formerly I.R.C. 1954] (as added by 
subsection (a)) shall not apply to any facility for the production of 
alcohol from solid waste if--
        ``(A) substantially all of the solid waste derived feedstock for 
    such facility is produced at a facility which--
            ``(i) went into full production in 1977,
            ``(ii) is located within the limits of a city, and
            ``(iii) is located in the same metropolitan area as the 
        alcohol-producing facility, and
        ``(B) before March 1, 1980, there were negotiations between a 
    governmental body and an organization described in section 501(c)(3) 
    of the Internal Revenue Code of 1986 with respect to the utilization 
    of a special process for the production of alcohol at such alcohol-
    producing facility.
    ``(2) Limitation.--The aggregate amount of obligations which may be 
issued by reason of paragraph (1) with respect to any project shall not 
exceed $30,000,000.
    ``(3) Termination.--This subsection shall not apply to obligations 
issued after December 31, 1985.''


                   Hydroelectric Generating Facilities

    Section 242(b) of Pub. L. 96-223, as amended by Pub. L. 99-514, 
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
    ``(1) In general.--For purposes of section 103(b)(4)(H) of the 
Internal Revenue Code of 1986 [formerly I.R.C. 1954] (relating to 
qualified hydroelectric generating facilities), in the case of a 
hydroelectric generating facility described in paragraph (2)--
        ``(A) the facility shall be treated as a qualified hydroelectric 
    generating facility (as defined in section 103(b)(8)(A) of such 
    Code) without regard to clause (ii) of section 48(l)(13)(B) of such 
    Code (relating to maximum generating capacity), and
        ``(B) the fraction referred to in subparagraph (C) of section 
    103(b)(8) of such Code shall be deemed to be 1.
    ``(2) Facilities to which paragraph (1) applies.--A facility is 
described in this paragraph if--
        ``(A) it would be a qualified hydroelectric generating facility 
    (as defined in section 103(b)(8)(A) of such Code) if clause (ii) of 
    section 48(l)(13)(B) did not apply,
        ``(B) it constitutes an expansion of generating capacity at an 
    existing hydroelectric generating facility,
        ``(C) such facility is located at 1 of 2 dams located in the 
    same county where--
            ``(i) the rated capacity of the hydroelectric generating 
        facilities at each such dam on October 18, 1979, was more than 
        750 megawatts,
            ``(ii) the construction of the first such dam began in 1956, 
        power at such first dam was first generated in 1959, and full 
        power production at such first dam began in 1961, and
            ``(iii) the construction of the second such dam began in 
        1959, power at such second dam was first generated in 1963, and 
        full power production at such second dam began in 1964,
        ``(D) acquisition or construction of the existing facility 
    referred to in subparagraph (B) was financed with the proceeds of an 
    obligation described in section 103(a)(1) of such Code,
        ``(E) the existing facility is owned and operated by a State, 
    political subdivision of a State, or agency or instrumentality of 
    any of the foregoing,
        ``(F) no more than 60 percent of the electric power and energy 
    produced by such existing facility and of the qualified 
    hydroelectric generating facility is to be sold to anyone other than 
    an exempt person (within the meaning of section 103(b)(3) of such 
    Code), and
        ``(G) the agency of the State in which the facility is located 
    which has jurisdiction over water rights had granted, before October 
    18, 1979, a water right under which expanded power and energy 
    generating capacity for the facility was contemplated.''


             State Obligations for Renewable Energy Property

    Section 243 of Pub. L. 96-223, as amended by Pub. L. 99-514, Sec. 2, 
Oct. 22, 1986, 100 Stat. 2095, provided that:
    ``(a) Certain State Obligations for Renewable Energy Property.--
        ``(1) In general.--Paragraph (1) of subsection (b) of section 
    103 of the Internal Revenue Code of 1986 [formerly I.R.C. 1954] 
    shall not apply to any obligation issued as part of an issue 
    substantially all of the proceeds of which are to be used to provide 
    renewable energy property, if--
            ``(A) the obligations are general obligations of a State,
            ``(B) the authority for the issuance of the obligations 
        requires that taxes be levied in sufficient amount to provide 
        for the payment of principal and interest on such obligations,
            ``(C) the amount of such obligations, when added to the sum 
        of the amounts of all such obligations previously issued by the 
        State which are outstanding, does not exceed the smaller of--
                ``(i) $500,000,000 or
                ``(ii) one-half of 1 percent of the value of all 
            property in the State,
            ``(D) such obligations are issued pursuant to a program to 
        provide financing for small scale energy projects which was 
        established by a State the legislature of which, before October 
        18, 1979, approved a constitutional amendment to provide for 
        such a program, and
            ``(E) such obligations meet the requirements of paragraph 
        (1) of section 103(h) of the Internal Revenue Code of 1986.
        ``(2) Renewable energy property.--For purposes of this 
    subsection, the term `renewable energy property' means property used 
    to produce energy (including heat, electricity, and substitute 
    fuels) from renewable energy sources (including wind, solar, and 
    geothermal energy, waste heat, biomass, and water).
    ``(b) Effective Date.--Subsection (a) shall apply with respect to 
obligations issued after the date of enactment of this Act [Apr. 2, 
1980].''


    Disposition of Amounts Generated by Advance Refunding of Certain 
                        Governmental Obligations

    Section 337 of Pub. L. 95-600, as amended by Pub. L. 96-222, title 
I, Sec. 103(a)(8), Apr. 1, 1980, 94 Stat. 212; Pub. L. 99-514, Sec. 2, 
Oct. 22, 1986, 100 Stat. 2095, provided that:
    ``(a) General Rule.--The payment to a charitable organization of a 
refund profit held in a trust fund or escrow arrangement, or held by an 
underwriter or other person under a qualified agreement in accordance 
with that agreement--
        ``(1) shall not cause the refunding obligations out of which the 
    refund profit arose to be treated as arbitrage bonds (within the 
    meaning of section 103(c) of the Internal Revenue Code of 1986 
    [formerly I.R.C. 1954]) and
        ``(2) may be paid without penalty imposed on the issuer of such 
    obligations.
    ``(b) Rule for Governments Which Have Already Paid Arbitrage Profits 
to the United States.--In the case of a State or local government which, 
before January 1, 1977--
        ``(1) requested in writing a rule by the Internal Revenue 
    Service with respect to the tax consequences of paying refund profit 
    to charitable organizations,
        ``(2) failed to receive a favorable ruling and did not pay the 
    refund profit to a charitable organization, and
which accounted to the United States for refund profit by direct payment 
to the United States, or by the purchase of low-interest United States 
obligations, the Secretary of the Treasury shall pay, out of any amounts 
in the Treasury not otherwise appropriated, an amount equal to the 
refund profit for which the State or local government has accounted to 
the United States. Amounts paid to a State or local government under 
this subsection shall be distributed to such charitable organizations 
within 90 days after the date on which the payment is received by the 
State or local government in the same manner as if the refund profit had 
not been paid to the United States and met the requirements of 
subsection (a).
    ``(c) Definitions.--For purposes of this section--
        ``(1) Refund profit.--The term `Refund profit' means interest, 
    profit, or other amounts generated by, or arising out of, the 
    advance refunding, before September 24, 1976, of an obligation of a 
    State or local government described in section 103 of such Code.
        ``(2) Charitable organization.--The term `charitable 
    organization' means an organization described in section 501(c)(3) 
    of such Code and exempt from taxation under section 501(a) of such 
    Code other than an organization described in section 509(a) of such 
    Code.
        ``(3) Qualified agreement.--The term `qualified agreement' means 
    an agreement (whether or not enforceable) which provides for, or 
    contemplates, the payment of refund profit to one or more charitable 
    organizations.
        ``(4) Low-interest united states obligations.--The term `low-
    interest United States obligations' means United States obligations 
    which bear an interest rate lower than the highest rate of interest 
    borne by public debt securities generally available for purchase at 
    the time such obligations were purchased.''


 Transitional Provisions for Industrial Development Bonds Issued Before 
                             January 1, 1969

    Section 107(b)(2) of Pub. L. 90-364, as amended by Pub. L. 99-514, 
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that: ``Section 
103(c)(1) of the Internal Revenue Code of 1986 [formerly I.R.C. 1954], 
as amended by subsection (a) [subsec. (b)(1), formerly subsec. (c)(1) of 
this section], shall not apply with respect to any obligation issued 
before January 1, 1969, if before May 1, 1968--
        ``(A) the issuance of the obligation (or the project in 
    connection with which the proceeds of the obligations are to be 
    used) was authorized or approved by the governing body of the 
    governmental unit issuing the obligation or by the voters of such 
    governmental unit;
        ``(B) in connection with the issuance of such obligation or with 
    the use of the proceeds to be derived from the sale of such 
    obligation or the property to be acquired or improved with such 
    proceeds, a governmental unit has made a significant financial 
    commitment;
        ``(C) any person (other than a governmental unit) who will use 
    the proceeds to be derived from the sale of such obligation or the 
    property to be acquired or improved with such proceeds has expended 
    (or has entered into a binding contract to expend) for purposes 
    which are related to the use of such proceeds or property, an amount 
    equal to or in excess of 20 percent of such proceeds; or
        ``(D) in the case of an obligation issued in conjunction with a 
    project where financial assistance will be provided by a 
    governmental agency concerned with economic development, such agency 
    has approved the project or an application for financial assistance 
    is pending.''

                  Section Referred to in Other Sections

    This section is referred to in sections 29, 42, 45, 45D, 48, 57, 
142, 143, 144, 145, 148, 149, 150, 168, 265, 465, 593, 643, 667, 772, 
811, 832, 834, 842, 851, 871, 1275, 1276, 1278, 4940, 4942, 6049, 7478, 
7518, 7701, 7871 of this title; title 7 section 608c; title 12 sections 
1441a, 1831q; title 15 sections 77c, 78c; title 16 sections 839f, 2708; 
title 19 section 2345; title 45 section 1207; title 46 App. section 
1177; title 48 sections 1574, 1670.
