S.L.C.AMENDMENT SENATE AMENDMENTTO THE TOH.NO.llll Calendar No.lllPurpose: In the nature of a substitute.IN THE SENATE OF THE UNITED STATES—110th Cong., 2d Sess.H. R. 3997lllllllllOFFERED BYIn lieu of the matter proposed to be inserted by theamendment of the Senate to the amendment of theHouse to the amendment of the Senate,1424To amend section 712 of the Employee Retirement IncomeSecurity Act of 1974, section 2705 of the Public HealthService Act, section 9812 of the Internal Revenue Codeof 1986 to require equity in the provision of mentalhealth and substance-related disorder benefits undergroup health plans, to prohibit discrimination on thebasis of genetic information with respect to health insur ance and employment, and for other purposes.Referred to the Committee on llllllllll andordered to be printedOrdered to lie on the table and to be printedAMENDMENT IN THE NATURE OF A SUBSTITUTE intendedto be proposed by lllllllViz:Strike all after the enacting clause and insert the fol lowing:lowing:S.L.C.DIVISION A—EMERGENCYECONOMIC STABILIZATIONSECTION 1. SHORT TITLE AND TABLE OF CONTENTS.(a) SHORT TITLE.—This Actdivision may be cited as the‘‘Emergency Economic Stabilization Act of 2008’’.(b) TABLE CONTENTS.—The table of contents forOFthis Actdivision is as follows:Sec. 1. Short title and table of contents.Sec. 2. Purposes.Sec. 3. Definitions.TITLE I—TROUBLED ASSETS RELIEF PROGRAMSec. 101. Purchases of troubled assets.Sec. 102. Insurance of troubled assets.Sec. 103. Considerations.Sec. 104. Financial Stability Oversight Board.Sec. 105. Reports.Sec. 106. Rights; management; sale of troubled assets; revenues and sale pro ceeds.Sec. 107. Contracting procedures.Sec. 108. Conflicts of interest.Sec. 109. Foreclosure mitigation efforts.Sec. 110. Assistance to homeowners.Sec. 111. Executive compensation and corporate governance.Sec. 112. Coordination with foreign authorities and central banks.Sec. 113. Minimization of long-term costs and maximization of benefits for tax payers.Sec. 114. Market transparency.Sec. 115. Graduated authorization to purchase.Sec. 116. Oversight and audits.Sec. 117. Study and report on margin authority.Sec. 118. Funding.Sec. 119. Judicial review and related matters.Sec. 120. Termination of authority.Sec. 121. Special Inspector General for the Troubled Asset Relief Program.Sec. 122. Increase in statutory limit on the public debt.Sec. 123. Credit reform.Sec. 124. HOPE for Homeowners amendments.Sec. 125. Congressional Oversight Panel.Sec. 126. FDIC authority.Sec. 127. Cooperation with the FBI.Sec. 128. Acceleration of effective date.Sec. 129. Disclosures on exercise of loan authority.Sec. 130. Technical corrections.Sec. 131. Exchange Stabilization Fund reimbursement.Sec. 132. Authority to suspend mark-to-market accounting.S.L.C.Sec. 133. Study on mark-to-market accounting.Sec. 134. Recoupment.Sec. 135. Preservation of authority.Sec. 136. Temporary increase in deposit and share insurance coverage.TITLE II—BUDGET-RELATED PROVISIONSSec. 201. Information for congressional support agencies.Sec. 202. Reports by the Office of Management and Budget and the Congres sional Budget Office.Sec. 203. Analysis in President’s Budget.Sec. 204. Emergency treatment.TITLE III—TAX PROVISIONSSec. 301. Gain or loss from sale or exchange of certain preferred stock.Sec. 302. Special rules for tax treatment of executive compensation of employ ers participating in the troubled assets relief program.Sec. 303. Extension of exclusion of income from discharge of qualified principalresidence indebtedness.SEC. 2. PURPOSES.The purposes of this Act are—(1) to immediately provide authority and facilities that the Secretary of the Treasury can use torestore liquidity and stability to the financial systemof the United States; and(2) to ensure that such authority and such facilities are used in a manner that—(A) protects home values, college funds, retirement accounts, and life savings;(B) preserves homeownership and promotes jobs and economic growth;(C) maximizes overall returns to the taxpayers of the United States; and(D) provides public accountability for theexercise of such authority.S.L.C.SEC. 3. DEFINITIONS.For purposes of this Act, the following definitionsshall apply:(1) APPROPRIATE CON COMMITTEES OFGRESS.—The term ‘‘appropriate committees of Congress’’ means—(A) the Committee on Banking, Housing,and Urban Affairs, the Committee on Finance,the Committee on the Budget, and the Committee on Appropriations of the Senate; and(B) the Committee on Financial Services,the Committee on Ways and Means, the Committee on the Budget, and the Committee onAppropriations of the House of Representatives.(2) BOARD.—The term ‘‘Board’’ means theBoard of Governors of the Federal Reserve System.(3) CONGRESSIONAL SUPPORT AGENCIES.—Theterm ‘‘congressional support agencies’’ means theCongressional Budget Office and the Joint Committee on Taxation.(4) CORPORATION.—The term ‘‘Corporation’’means the Federal Deposit Insurance Corporation.(5) FINANCIAL INSTITUTION.—The term ‘‘financial institution’’ means any institution, including,but not limited to, any bank, savings association,credit union, security broker or dealer, or insuranceS.L.C.company, established and regulated under the lawsof the United States or any State, territory, or possession of the United States, the District of Columbia, Commonwealth of Puerto Rico, Commonwealthof Northern Mariana Islands, Guam, AmericanSamoa, or the United States Virgin Islands, andhaving significant operations in the United States,but excluding any central bank of, or institutionowned by, a foreign government.(6) FUND.—The term ‘‘Fund’’ means the Troubled Assets Insurance Financing Fund establishedunder section 102.(7) SECRETARY.—The term ‘‘Secretary’’ meansthe Secretary of the Treasury.(8) TARP.—The term ‘‘TARP’’ means theTroubled Asset Relief Program established undersection 101.(9) TROUBLED ASSETS.—The term ‘‘troubledassets’’ means—(A) residential or commercial mortgagesand any securities, obligations, or other instruments that are based on or related to suchmortgages, that in each case was originated orissued on or before March 14, 2008, the purchase of which the Secretary O:\AYO\AYO08C32.xml S.L.C.chase of which the Secretary determines promotes financial market stability; and(B) any other financial instrument that theSecretary, after consultation with the Chairmanof the Board of Governors of the Federal Reserve System, determines the purchase of whichis necessary to promote financial market stability, but only upon transmittal of such determination, in writing, to the appropriate committees of Congress.TITLE I—TROUBLED ASSETSRELIEF PROGRAMSEC. 101. PURCHASES OF TROUBLED ASSETS.(a) OFFICES; AUTHORITY.—(1) AUTHORITY.—The Secretary is authorizedto establish the Troubled Asset Relief Program (or‘‘TARP’’) to purchase, and to make and fund commitments to purchase, troubled assets from any financial institution, on such terms and conditions asare determined by the Secretary, and in accordancewith this Act and the policies and procedures developed and published by the Secretary.(2) COMMENCEMENT OF PROGRAM.—Establishment of the policies and procedures and other similar administrative requirements imposed on the Secretary by this Act are not O:\AYO\AYO08C32.xml S.L.C.retary by this Act are not intended to delay the commencement of the TARP.(3) ESTABLISHMENT OF TREASURY OFFICE.—(A) IN GENERAL.—The Secretary shall implement any program under paragraph (1)through an Office of Financial Stability, established for such purpose within the Office of Domestic Finance of the Department of the Treasury, which office shall be headed by an Assistant Secretary of the Treasury, appointed by thePresident, by and with the advice and consentof the Senate, except that an interim AssistantSecretary may be appointed by the Secretary.(B) CLERICAL AMENDMENTS.—(i) TITLE 5.—Section 5315 of title 5,United States Code, is amended in theitem relating to Assistant Secretaries ofthe Treasury, by striking ‘‘(9)’’ and inserting ‘‘(10)’’.(ii) TITLE 31.—Section 301(e) of title31, United States Code, is amended bystriking ‘‘9’’ and inserting ‘‘10’’.(b) CONSULTATION.—In exercising the authorityunder this section, the Secretary shall consult with theBoard, the Corporation, the Comptroller of the Currency,S.L.C.the Director of the Office of Thrift Supervision, and theSecretary of Housing and Urban Development.(c) NECESSARY ACTIONS.—The Secretary is authorized to take such actions as the Secretary deems necessaryto carry out the authorities in this Act, including, withoutlimitation, the following:(1) The Secretary shall have direct hiring authority with respect to the appointment of employeesto administer this Act.(2) Entering into contracts, including contractsfor services authorized by section 3109 of title 5,United States Code.(3) Designating financial institutions as financial agents of the Federal Government, and such institutions shall perform all such reasonable dutiesrelated to this Act as financial agents of the FederalGovernment as may be required.(4) In order to provide the Secretary with theflexibility to manage troubled assets in a manner designed to minimize cost to the taxpayers, establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase, hold, and selltroubled assets and issue obligations.S.L.C.(5) Issuing such regulations and other guidanceas may be necessary or appropriate to define termsor carry out the authorities or purposes of this Act.(d) PROGRAM GUIDELINES.—Before the earlier ofthe end of the 2-business-day period beginning on the dateof the first purchase of troubled assets pursuant to theauthority under this section or the end of the 45-day period beginning on the date of enactment of this Act, theSecretary shall publish program guidelines, including thefollowing:(1) Mechanisms for purchasing troubled assets.(2) Methods for pricing and valuing troubledassets.(3) Procedures for selecting asset managers.(4) Criteria for identifying troubled assets forpurchase.(e) PREVENTING UNJUST ENRICHMENT.—In makingpurchases under the authority of this Act, the Secretaryshall take such steps as may be necessary to prevent unjust enrichment of financial institutions participating ina program established under this section, including by preventing the sale of a troubled asset to the Secretary ata higher price than what the seller paid to purchase theasset. This subsection does not apply to troubled assetsacquired in a merger or acquisition, or a purchase of asO:\AYO\AYO08C32.xml S.L.C.sets from a financial institution in conservatorship or receivership, or that has initiated bankruptcy proceedingsunder title 11, United States Code.SEC. 102. INSURANCE OF TROUBLED ASSETS.(a) AUTHORITY.—(1) IN GENERAL.—If the Secretary establishesthe program authorized under section 101, then theSecretary shall establish a program to guaranteetroubled assets originated or issued prior to March14, 2008, including mortgage-backed securities.(2) GUARANTEES.—In establishing any program under this subsection, the Secretary may develop guarantees of troubled assets and the associated premiums for such guarantees. Such guarantees and premiums may be determined by categoryor class of the troubled assets to be guaranteed.(3) EXTENT OF GUARANTEE.—Upon request ofa financial institution, the Secretary may guaranteethe timely payment of principal of, and interest on,troubled assets in amounts not to exceed 100 percent of such payments. Such guarantee may be onsuch terms and conditions as are determined by theSecretary, provided that such terms and conditionsare consistent with the purposes of this Act.S.L.C.(b) REPORTS.—Not later than 90 days after the dateof enactment of this Act, the Secretary shall report to theappropriate committees of Congress on the program established under subsection (a).(c) PREMIUMS.—(1) IN GENERAL.—The Secretary shall collectpremiums from any financial institution participating in the program established under subsection(a). Such premiums shall be in an amount that theSecretary determines necessary to meet the purposesof this Act and to provide sufficient reserves pursuant to paragraph (3).(2) AUTHORITY TO BASE PREMIUMS ON PRODRISK.—In establishing any premium underUCTparagraph (1), the Secretary may provide for variations in such rates according to the credit risk associated with the particular troubled asset that isbeing guaranteed. The Secretary shall publish themethodology for setting the premium for a class oftroubled assets together with an explanation of theappropriateness of the class of assets for participation in the program established under this section.The methodology shall ensure that the premium isconsistent with paragraph (3).(3)S.L.C.(3) MINIMUM LEVEL.—The premiums referredto in paragraph (1) shall be set by the Secretary ata level necessary to create reserves sufficient to meetanticipated claims, based on an actuarial analysis,and to ensure that taxpayers are fully protected.(4) ADJUSTMENT TO PURCHASE AUTHORITY.—The purchase authority limit in section 115 shall bereduced by an amount equal to the difference between the total of the outstanding guaranteed obligations and the balance in the Troubled Assets Insurance Financing Fund.(d) TROUBLED ASSETS INSURANCE FINANCINGFUND.—(1) DEPOSITS.—The Secretary shall depositfees collected under this section into the Fund established under paragraph (2).(2) ESTABLISHMENT.—There is established aTroubled Assets Insurance Financing Fund thatshall consist of the amounts collected pursuant toparagraph (1), and any balance in such fund shallbe invested by the Secretary in United States Treasury securities, or kept in cash on hand or on deposit,as necessary.(3) PAYMENTS FROM FUND.—The Secretaryshall make payments from amounts deposited in theFund to fulfill obligations of the S.L.C.Fund to fulfill obligations of the guarantees providedto financial institutions under subsection (a).SEC. 103. CONSIDERATIONS.In exercising the authorities granted in this Act, theSecretary shall take into consideration—(1) protecting the interests of taxpayers bymaximizing overall returns and minimizing the impact on the national debt;(2) providing stability and preventing disruption to financial markets in order to limit the impacton the economy and protect American jobs, savings,and retirement security;(3) the need to help families keep their homesand to stabilize communities;(4) in determining whether to engage in a direct purchase from an individual financial institution, the long-term viability of the financial institution in determining whether the purchase representsthe most efficient use of funds under this Act;(5) ensuring that all financial institutions areeligible to participate in the program, without discrimination based on size, geography, form of organization, or the size, type, and number of assets eligible for purchase under this Act;S.L.C.(6) providing financial assistance to financialinstitutions, including those serving low- and moderate-income populations and other underservedcommunities, and that have assets less than$1,000,000,000, that were well or adequately capitalized as of June 30, 2008, and that as a resultof the devaluation of the preferred government-sponsored enterprises stock will drop one or more capitallevels, in a manner sufficient to restore the financialinstitutions to at least an adequately capitalizedlevel;(7) the need to ensure stability for UnitedStates public instrumentalities, such as counties andcities, that may have suffered significant increasedcosts or losses in the current market turmoil;(8) protecting the retirement security of Americans by purchasing troubled assets held by or on behalf of an eligible retirement plan described in clause(iii), (iv), (v), or (vi) of section 402(c)(8)(B) of theInternal Revenue Code of 1986, except that such authority shall not extend to any compensation arrangements subject to section 409A of such Code;andS.L.C.(9) the utility of purchasing other real estateowned and instruments backed by mortgages onmultifamily properties.SEC. 104. FINANCIAL STABILITY OVERSIGHT BOARD.(a) ESTABLISHMENT.—There is established the Financial Stability Oversight Board, which shall be responsible for—(1) reviewing the exercise of authority under aprogram developed in accordance with this Act, including—(A) policies implemented by the Secretaryand the Office of Financial Stability createdunder sections 101 and 102, including the appointment of financial agents, the designationof asset classes to be purchased, and plans forthe structure of vehicles used to purchase troubled assets; and(B) the effect of such actions in assistingAmerican families in preserving home ownership, stabilizing financial markets, and protecting taxpayers;(2) making recommendations, as appropriate, tothe Secretary regarding use of the authority underthis Act; andS.L.C.(3) reporting any suspected fraud, misrepresentation, or malfeasance to the Special Inspector General for the Troubled Assets Relief Program or theAttorney General of the United States, consistentwith section 535(b) of title 28, United States Code.(b) MEMBERSHIP.—The Financial Stability Oversight Board shall be comprised of—(1) the Chairman of the Board of Governors ofthe Federal Reserve System;(2) the Secretary;(3) the Director of the Federal Housing Finance Agency;(4) the Chairman of the Securities ExchangeCommission; and(5) the Secretary of Housing and Urban Development.(c) CHAIRPERSON.—The chairperson of the FinancialStability Oversight Board shall be elected by the membersof the Board from among the members other than the Secretary.(d) MEETINGS.—The Financial Stability OversightBoard shall meet 2 weeks after the first exercise of thepurchase authority of the Secretary under this Act, andmonthly thereafter.S.L.C.(e) ADDITIONAL AUTHORITIES.—In addition to theresponsibilities described in subsection (a), the FinancialStability Oversight Board shall have the authority to ensure that the policies implemented by the Secretary are—(1) in accordance with the purposes of this Act;(2) in the economic interests of the UnitedStates; and(3) consistent with protecting taxpayers, in accordance with section 113(a).(f) CREDIT REVIEW COMMITTEE.—The FinancialStability Oversight Board may appoint a credit reviewcommittee for the purpose of evaluating the exercise ofthe purchase authority provided under this Act and theassets acquired through the exercise of such authority, asthe Financial Stability Oversight Board determines appropriate.(g) REPORTS.—The Financial Stability OversightBoard shall report to the appropriate committees of Congress and the Congressional Oversight Panel establishedunder section 125, not less frequently than quarterly, onthe matters described under subsection (a)(1).(h) TERMINATION.—The Financial Stability Oversight Board, and its authority under this section, shall terminate on the expiration of the 15-day period beginningupon the later of—(1) the date that the last troubled asset acquired by the Secretary under section S.L.C.(1) the date that the last troubled asset acquired by the Secretary under section 101 has beensold or transferred out of the ownership or controlof the Federal Government; or(2) the date of expiration of the last insurancecontract issued under section 102.SEC. 105. REPORTS.(a) IN GENERAL.—Before the expiration of the 60day period beginning on the date of the first exercise ofthe authority granted in section 101(a), or of the first exercise of the authority granted in section 102, whicheveroccurs first, and every 30-day period thereafter, the Secretary shall report to the appropriate committees of Congress, with respect to each such period—(1) an overview of actions taken by the Secretary, including the considerations required by section 103 and the efforts under section 109;(2) the actual obligation and expenditure of thefunds provided for administrative expenses by section 118 during such period and the expected expenditure of such funds in the subsequent period;and(3) a detailed financial statement with respectto the exercise of authority under this Act, including—S.L.C.(A) all agreements made or renewed;(B) all insurance contracts entered intopursuant to section 102;(C) all transactions occurring during suchperiod, including the types of parties involved;(D) the nature of the assets purchased;(E) all projected costs and liabilities;(F) operating expenses, including compensation for financial agents;(G) the valuation or pricing method usedfor each transaction; and(H) a description of the vehicles established to exercise such authority.(b) TRANCHE REPORTS TO CONGRESS.—(1) REPORTS.—The Secretary shall provide tothe appropriate committees of Congress, at the timesspecified in paragraph (2), a written report, including—(A) a description of all of the transactionsmade during the reporting period;(B) a description of the pricing mechanismfor the transactions;(C) a justification of the price paid for andother financial terms associated with the transactions;S.L.C.(D) a description of the impact of the exercise of such authority on the financial system,supported, to the extent possible, by specificdata;(E) a description of challenges that remainin the financial system, including any benchmarks yet to be achieved; and(F) an estimate of additional actions underthe authority provided under this Act that maybe necessary to address such challenges.(2) TIMING.—The report required by this subsection shall be submitted not later than 7 daysafter the date on which commitments to purchasetroubled assets under the authorities provided in thisAct first reach an aggregate of $50,000,000,000 andnot later than 7 days after each $50,000,000,000 interval of such commitments is reached thereafter.(c) REGULATORY MODERNIZATION REPORT.—TheSecretary shall review the current state of the financialmarkets and the regulatory system and submit a writtenreport to the appropriate committees of Congress not laterthan April 30, 2009, analyzing the current state of theregulatory system and its effectiveness at overseeing theparticipants in the financial markets, including the overthe-counter swaps market and government-sponsored enO:\AYO\AYO08C32.xml S.L.C.terprises, and providing recommendations for improvement, including—(1) recommendations regarding—(A) whether any participants in the financial markets that are currently outside the regulatory system should become subject to theregulatory system; and(B) enhancement of the clearing and settlement of over-the-counter swaps; and(2) the rationale underlying such recommendations.(d) SHARING INFORMATION.—Any report re OFquired under this section shall also be submitted to theCongressional Oversight Panel established under section125.(e) SUNSET.—The reporting requirements under thissection shall terminate on the later of—(1) the date that the last troubled asset acquired by the Secretary under section 101 has beensold or transferred out of the ownership or controlof the Federal Government; or(2) the date of expiration of the last insurancecontract issued under section 102.S.L.C.SEC. 106. RIGHTS; MANAGEMENT; SALE OF TROUBLED ASSETS; REVENUES AND SALE PROCEEDS.(a) EXERCISE RIGHTS.—The Secretary may, atOFany time, exercise any rights received in connection withtroubled assets purchased under this Act.(b) MANAGEMENT OF TROUBLED ASSETS.—The Secretary shall have authority to manage troubled assets purchased under this Act, including revenues and portfoliorisks therefrom.(c) SALE TROUBLED ASSETS.—The SecretaryOFmay, at any time, upon terms and conditions and at aprice determined by the Secretary, sell, or enter into securities loans, repurchase transactions, or other financialtransactions in regard to, any troubled asset purchasedunder this Act.(d) TRANSFER TREASURY.—Revenues of, andTOproceeds from the sale of troubled assets purchased underthis Act, or from the sale, exercise, or surrender of warrants or senior debt instruments acquired under section113 shall be paid into the general fund of the Treasuryfor reduction of the public debt.(e) APPLICATION SUNSET TROUBLED AS OF TOSETS.—The authority of the Secretary to hold any troubled asset purchased under this Act before the terminationdate in section 120, or to purchase or fund the purchaseof a troubled asset under a commitment entered into beO:\AYO\AYO08C32.xml S.L.C.fore the termination date in section 120, is not subjectto the provisions of section 120.SEC. 107. CONTRACTING PROCEDURES.(a) STREAMLINED PROCESS.—For purposes of thisAct, the Secretary may waive specific provisions of theFederal Acquisition Regulation upon a determination thaturgent and compelling circumstances make compliancewith such provisions contrary to the public interest. Anysuch determination, and the justification for such determination, shall be submitted to the Committees on Oversight and Government Reform and Financial Services ofthe House of Representatives and the Committees onHomeland Security and Governmental Affairs and Banking, Housing, and Urban Affairs of the Senate within 7days.(b) ADDITIONAL CONTRACTING REQUIREMENTS.—Inany solicitation or contract where the Secretary has, pursuant to subsection (a), waived any provision of the Federal Acquisition Regulation pertaining to minority contracting, the Secretary shall develop and implement standards and procedures to ensure, to the maximum extentpracticable, the inclusion and utilization of minorities (assuch term is defined in section 1204(c) of the FinancialInstitutions Reform, Recovery, and Enforcement Act of1989 (12 U.S.C. 1811 note)) and women, and minorityO:\AYO\AYO08C32.xml S.L.C.and women-owned businesses (as such terms are definedin section 21A(r)(4) of the Federal Home Loan Bank Act(12 U.S.C. 1441a(r)(4)), in that solicitation or contract,including contracts to asset managers, servicers, propertymanagers, and other service providers or expert consultants.(c) ELIGIBILITY FDIC.—Notwithstanding sub OFsections (a) and (b), the Corporation—(1) shall be eligible for, and shall be consideredin, the selection of asset managers for residentialmortgage loans and residential mortgage-backed securities; and(2) shall be reimbursed by the Secretary forany services provided.SEC. 108. CONFLICTS OF INTEREST.(a) STANDARDS REQUIRED.—The Secretary shallissue regulations or guidelines necessary to address andmanage or to prohibit conflicts of interest that may arisein connection with the administration and execution of theauthorities provided under this Act, including—(1) conflicts arising in the selection or hiring ofcontractors or advisors, including asset managers;(2) the purchase of troubled assets;(3) the management of the troubled assets held;S.L.C.(4) post-employment restrictions on employees;and(5) any other potential conflict of interest, asthe Secretary deems necessary or appropriate in thepublic interest.(b) TIMING.—Regulations or guidelines required bythis section shall be issued as soon as practicable afterthe date of enactment of this Act.SEC. 109. FORECLOSURE MITIGATION EFFORTS.(a) RESIDENTIAL MORTGAGE LOAN SERVICINGSTANDARDS.—To the extent that the Secretary acquiresmortgages, mortgage backed securities, and other assetssecured by residential real estate, including multifamilyhousing, the Secretary shall implement a plan that seeksto maximize assistance for homeowners and use the authority of the Secretary to encourage the servicers of theunderlying mortgages, considering net present value to thetaxpayer, to take advantage of the HOPE for Homeowners Program under section 257 of the National Housing Act or other available programs to minimize foreclosures. In addition, the Secretary may use loan guarantees and credit enhancements to facilitate loan modifications to prevent avoidable foreclosures.(b) COORDINATION.—The Secretary shall coordinatewith the Corporation, the Board (with respect to anyS.L.C.mortgage or mortgage-backed securities or pool of securities held, owned, or controlled by or on behalf of a Federalreserve bank, as provided in section 110(a)(1)(C)), theFederal Housing Finance Agency, the Secretary of Housing and Urban Development, and other Federal Government entities that hold troubled assets to attempt to identify opportunities for the acquisition of classes of troubledassets that will improve the ability of the Secretary to improve the loan modification and restructuring process and,where permissible, to permit bona fide tenants who arecurrent on their rent to remain in their homes under theterms of the lease. In the case of a mortgage on a residential rental property, the plan required under this sectionshall include protecting Federal, State, and local rentalsubsidies and protections, and ensuring any modificationtakes into account the need for operating funds to maintain decent and safe conditions at the property.(c) CONSENT REASONABLE LOAN MODIFICATIONTOREQUESTS.—Upon any request arising under existing investment contracts, the Secretary shall consent, where appropriate, and considering net present value to the taxpayer, to reasonable requests for loss mitigation measures,including term extensions, rate reductions, principal writedowns, increases in the proportion of loans within a trustS.L.C.or other structure allowed to be modified, or removal ofother limitation on modifications.SEC. 110. ASSISTANCE TO HOMEOWNERS.(a) DEFINITIONS.—As used in this section—(1) the term ‘‘Federal property manager’’means—(A) the Federal Housing Finance Agency,in its capacity as conservator of the FederalNational Mortgage Association and the FederalHome Loan Mortgage Corporation;(B) the Corporation, with respect to residential mortgage loans and mortgage-backed securities held by any bridge depository institution pursuant to section 11(n) of the FederalDeposit Insurance Act; and(C) the Board, with respect to any mortgage or mortgage-backed securities or pool ofsecurities held, owned, or controlled by or onbehalf of a Federal reserve bank, other thanmortgages or securities held, owned, or controlled in connection with open market operations under section 14 of the Federal ReserveAct (12 U.S.C. 353), or as collateral for an advance or discount that is not in default;(2) the term ‘‘consumer’’ has the same S.L.C.(2) the term ‘‘consumer’’ has the same meaningas in section 103 of the Truth in Lending Act (15U.S.C. 1602);(3) the term ‘‘insured depository institution’’has the same meaning as in section 3 of the FederalDeposit Insurance Act (12 U.S.C. 1813); and(4) the term ‘‘servicer’’ has the same meaningas in section 6(i)(2) of the Real Estate SettlementProcedures Act of 1974 (12 U.S.C. 2605(i)(2)).(b) HOMEOWNER ASSISTANCE BY AGENCIES.—(1) IN GENERAL.—To the extent that the Federal property manager holds, owns, or controls mortgages, mortgage backed securities, and other assetssecured by residential real estate, including multifamily housing, the Federal property manager shallimplement a plan that seeks to maximize assistancefor homeowners and use its authority to encouragethe servicers of the underlying mortgages, and considering net present value to the taxpayer, to takeadvantage of the HOPE for Homeowners Programunder section 257 of the National Housing Act orother available programs to minimize foreclosures.(2) MODIFICATIONS.—In the case of a residential mortgage loan, modifications made under paragraph (1) may include—S.L.C.(A) reduction in interest rates;(B) reduction of loan principal; and(C) other similar modifications.(3) TENANT PROTECTIONS.—In the case ofmortgages on residential rental properties, modifications made under paragraph (1) shall ensure—(A) the continuation of any existing Federal, State, and local rental subsidies and protections; and(B) that modifications take into accountthe need for operating funds to maintain decentand safe conditions at the property.(4) TIMING.—Each Federal property managershall develop and begin implementation of the planrequired by this subsection not later than 60 daysafter the date of enactment of this Act.(5) REPORTS CONGRESS.—Each FederalTOproperty manager shall, 60 days after the date ofenactment of this Act and every 30 days thereafter,report to Congress specific information on the number and types of loan modifications made and thenumber of actual foreclosures occurring during thereporting period in accordance with this section.(6) CONSULTATION.—In developing the plan required by this subsection, the Federal property manO:\AYO\AYO08C32.xml S.L.C.agers shall consult with one another and, to the extent possible, utilize consistent approaches to implement the requirements of this subsection.(c) ACTIONS WITH RESPECT TO SERVICERS.—In anycase in which a Federal property manager is not the ownerof a residential mortgage loan, but holds an interest inobligations or pools of obligations secured by residentialmortgage loans, the Federal property manager shall—(1) encourage implementation by the loanservicers of loan modifications developed under subsection (b); and(2) assist in facilitating any such modifications,to the extent possible.(d) LIMITATION.—The requirements of this sectionshall not supersede any other duty or requirement imposedon the Federal property managers under otherwise applicable law.SEC. 111. EXECUTIVE COMPENSATION AND CORPORATEGOVERNANCE.(a) APPLICABILITY.—Any financial institution thatsells troubled assets to the Secretary under this Act shallbe subject to the executive compensation requirements ofsubsections (b) and (c) and the provisions under the Internal Revenue Code of 1986, as provided under the amendment by section 302, as applicable.S.L.C.(b) DIRECT PURCHASES.—(1) IN GENERAL.—Where the Secretary determines that the purposes of this Act are best metthrough direct purchases of troubled assets from anindividual financial institution where no biddingprocess or market prices are available, and the Secretary receives a meaningful equity or debt positionin the financial institution as a result of the transaction, the Secretary shall require that the financialinstitution meet appropriate standards for executivecompensation and corporate governance. The standards required under this subsection shall be effectivefor the duration of the period that the Secretaryholds an equity or debt position in the financial institution.(2) CRITERIA.—The standards required underthis subsection shall include—(A) limits on compensation that exclude incentives for senior executive officers of a financial institution to take unnecessary and excessive risks that threaten the value of the financial institution during the period that the Secretary holds an equity or debt position in the financial institution;S.L.C.(B) a provision for the recovery by the financial institution of any bonus or incentivecompensation paid to a senior executive officerbased on statements of earnings, gains, or othercriteria that are later proven to be materiallyinaccurate; and(C) a prohibition on the financial institution making any golden parachute payment toits senior executive officer during the periodthat the Secretary holds an equity or debt position in the financial institution.(3) DEFINITION.—For purposes of this section,the term ‘‘senior executive officer’’ means an individual who is one of the top 5 highly paid executivesof a public company, whose compensation is requiredto be disclosed pursuant to the Securities ExchangeAct of 1934, and any regulations issued thereunder,and non-public company counterparts.(c) AUCTION PURCHASES.—Where the Secretary determines that the purposes of this Act are best metthrough auction purchases of troubled assets, and onlywhere such purchases per financial institution in the aggregate exceed $300,000,000 (including direct purchases),the Secretary shall prohibit, for such financial institution,any new employment contract with a senior executive offiO:\AYO\AYO08C32.xml S.L.C.cer that provides a golden parachute in the event of aninvoluntary termination, bankruptcy filing, insolvency, orreceivership. The Secretary shall issue guidance to carryout this paragraph not later than 2 months after the dateof enactment of this Act, and such guidance shall be effective upon issuance.(d) SUNSET.—The provisions of subsection (c) shallapply only to arrangements entered into during the periodduring which the authorities under section 101(a) are ineffect, as determined under section 120.SEC. 112. COORDINATION WITH FOREIGN AUTHORITIESAND CENTRAL BANKS.The Secretary shall coordinate, as appropriate, withforeign financial authorities and central banks to work toward the establishment of similar programs by such authorities and central banks. To the extent that such foreign financial authorities or banks hold troubled assets asa result of extending financing to financial institutionsthat have failed or defaulted on such financing, such troubled assets qualify for purchase under section 101.SEC. 113. MINIMIZATION OF LONG-TERM COSTS AND MAXIMIZATION OF BENEFITS FOR TAXPAYERS.(a) LONG-TERM COSTS AND BENEFITS.—(1) MINIMIZING NEGATIVE IMPACT.—The Secretary shall use the authority under this Act in aSecretary shall use the authority under this Act in aS.L.C.manner that will minimize any potential long-termnegative impact on the taxpayer, taking into accountthe direct outlays, potential long-term returns on assets purchased, and the overall economic benefits ofthe program, including economic benefits due to improvements in economic activity and the availabilityof credit, the impact on the savings and pensions ofindividuals, and reductions in losses to the FederalGovernment.(2) AUTHORITY.—In carrying out paragraph(1), the Secretary shall—(A) hold the assets to maturity or for resale for and until such time as the Secretarydetermines that the market is optimal for selling such assets, in order to maximize the valuefor taxpayers; and(B) sell such assets at a price that the Secretary determines, based on available financialanalysis, will maximize return on investment forthe Federal Government.(3) PRIVATE PARTICIPATION.—TheSECTORSecretary shall encourage the private sector to participate in purchases of troubled assets, and to invest in financial institutions, consistent with the provisions of this section.(b) USE S.L.C.(b) USE MARKET MECHANISMS.—In making pur OFchases under this Act, the Secretary shall—(1) make such purchases at the lowest pricethat the Secretary determines to be consistent withthe purposes of this Act; and(2) maximize the efficiency of the use of taxpayer resources by using market mechanisms, including auctions or reverse auctions, where appropriate.(c) DIRECT PURCHASES.—If the Secretary determines that use of a market mechanism under subsection(b) is not feasible or appropriate, and the purposes of theAct are best met through direct purchases from an individual financial institution, the Secretary shall pursue additional measures to ensure that prices paid for assets arereasonable and reflect the underlying value of the asset.(d) CONDITIONS PURCHASE AUTHORITYON FORWARRANTS AND DEBT INSTRUMENTS.—(1) IN GENERAL.—The Secretary may not purchase, or make any commitment to purchase, anytroubled asset under the authority of this Act, unlessthe Secretary receives from the financial institutionfrom which such assets are to be purchased—(A) in the case of a financial institution,the securities of which are traded on a nationalS.L.C.securities exchange, a warrant giving the rightto the Secretary to receive nonvoting commonstock or preferred stock in such financial institution, or voting stock with respect to which,the Secretary agrees not to exercise votingpower, as the Secretary determines appropriate;or(B) in the case of any financial institutionother than one described in subparagraph (A),a warrant for common or preferred stock, or asenior debt instrument from such financial institution, as described in paragraph (2)(C).(2) TERMS AND CONDITIONS.—The terms andconditions of any warrant or senior debt instrumentrequired under paragraph (1) shall meet the following requirements:(A) PURPOSES.—Such terms and conditions shall, at a minimum, be designed—(i) to provide for reasonable participation by the Secretary, for the benefit oftaxpayers, in equity appreciation in thecase of a warrant or other equity security,or a reasonable interest rate premium, inthe case of a debt instrument; andS.L.C.(ii) to provide additional protectionfor the taxpayer against losses from sale ofassets by the Secretary under this Act andthe administrative expenses of the TARP.(B) AUTHORITY TO SELL, EXERCISE, ORSURRENDER.—The Secretary may sell, exercise,or surrender a warrant or any senior debt instrument received under this subsection, basedon the conditions established under subparagraph (A).(C) CONVERSION.—The warrant shall provide that if, after the warrant is received by theSecretary under this subsection, the financialinstitution that issued the warrant is no longerlisted or traded on a national securities exchange or securities association, as described inparagraph (1)(A), such warrants shall convertto senior debt, or contain appropriate protections for the Secretary to ensure that theTreasury is appropriately compensated for thevalue of the warrant, in an amount determinedby the Secretary.(D) PROTECTIONS.—Any warrant representing securities to be received by the Secretary under this subsection shall contain antidilution provisions of the O:\AYO\AYO08C32.xml S.L.C.dilution provisions of the type employed in capital market transactions, as determined by theSecretary. Such provisions shall protect thevalue of the securities from market transactionssuch as stock splits, stock distributions, dividends, and other distributions, mergers, andother forms of reorganization or recapitalization.(E) EXERCISE PRICE.—The exercise pricefor any warrant issued pursuant to this subsection shall be set by the Secretary, in the interest of the taxpayers.(F) SUFFICIENCY.—The financial institution shall guarantee to the Secretary that it hasauthorized shares of nonvoting stock availableto fulfill its obligations under this subsection.Should the financial institution not have sufficient authorized shares, including preferredshares that may carry dividend rights equal toa multiple number of common shares, the Secretary may, to the extent necessary, accept asenior debt note in an amount, and on suchterms as will compensate the Secretary withequivalent value, in the event that a sufficientS.L.C.shareholder vote to authorize the necessary additional shares cannot be obtained.(3) EXCEPTIONS.—(A) DE MINIMIS.—The Secretary shall establish de minimis exceptions to the requirements of this subsection, based on the size ofthe cumulative transactions of troubled assetspurchased from any one financial institution forthe duration of the program, at not more than$100,000,000.(B) OTHER EXCEPTIONS.—The Secretaryshall establish an exception to the requirementsof this subsection and appropriate alternativerequirements for any participating financial institution that is legally prohibited from issuingsecurities and debt instruments, so as not toallow circumvention of the requirements of thissection.SEC. 114. MARKET TRANSPARENCY.(a) PRICING.—To facilitate market transparency, theSecretary shall make available to the public, in electronicform, a description, amounts, and pricing of assets acquired under this Act, within 2 business days of purchase,trade, or other disposition.S.L.C.(b) DISCLOSURE.—For each type of financial institutions that sells troubled assets to the Secretary under thisAct, the Secretary shall determine whether the public disclosure required for such financial institutions with respect to off-balance sheet transactions, derivatives instruments, contingent liabilities, and similar sources of potential exposure is adequate to provide to the public sufficientinformation as to the true financial position of the institutions. If such disclosure is not adequate for that purpose,the Secretary shall make recommendations for additionaldisclosure requirements to the relevant regulators.SEC. 115. GRADUATED AUTHORIZATION TO PURCHASE.(a) AUTHORITY.—The authority of the Secretary topurchase troubled assets under this Act shall be limitedas follows:(1) Effective upon the date of enactment of thisAct, such authority shall be such authority shall be limited to$250,000,000,000 outstanding at any one time.(2) If at any time, the President submits to theCongress a written certification that the Secretaryneeds to exercise the authority under this paragraph,effective upon such submission, such authority shallbe limited to $350,000,000,000 outstanding at anyone time.S.L.C.(3) If, at any time after the certification inparagraph (2) has been made, the President transmits to the Congress a written report detailing theplan of the Secretary to exercise the authority underthis paragraph, unless there is enacted, within 15calendar days of such transmission, a joint resolution described in subsection (c), effective upon theexpiration of such 15-day period, such authorityshall be limited to $700,000,000,000 outstanding atany one time.(b) AGGREGATION PURCHASE PRICES.—TheOFamount of troubled assets purchased by the Secretary outstanding at any one time shall be determined for purposesof the dollar amount limitations under subsection (a) byaggregating the purchase prices of all troubled assets held.(c) JOINT RESOLUTION OF DISAPPROVAL.—(1) IN GENERAL.—Notwithstanding any otherprovision of this section, the Secretary may not exercise any authority to make purchases under this Actwith regard to any regard to any amount in excess of$350,000,000,000 previously obligated, as describedin this section if, within 15 calendar days after thedate on which Congress receives a report of the planof the Secretary described in subsection (a)(3), thereis enacted into law a joint resolution disapprovingS.L.C.the plan of the Secretary with respect to such additional amount.(2) CONTENTS OF JOINT RESOLUTION.—Forthe purpose of this section, the term ‘‘joint resolution’’ means only a joint resolution—(A) that is introduced not later than 3 calendar days after the date on which the reportof the plan of the Secretary referred to in subsection (a)(3) is received by Congress;(B) which does not have a preamble;(C) the title of which is as follows: ‘‘Jointresolution relating to the disapproval of obligations under the Emergency Economic Stabilization Act of 2008’’; and(D) the matter after the resolving clause ofwhich is as follows: ‘‘That Congress disapprovesthe obligation of any amount exceeding theamounts obligated as described in paragraphs(1) and (2) of section 115(a) of the EmergencyEconomic Stabilization Act of 2008.’’.(d) FAST TRACK CONSIDERATION IN HOUSE OF REPRESENTATIVES.—(1) RECONVENING.—Upon receipt of a reportunder subsection (a)(3), the Speaker, if the Housewould otherwise be adjourned, shall notify the Members of the House that, pursuant to this section, O:\AYO\AYO08C32.xml S.L.C.bers of the House that, pursuant to this section, theHouse shall convene not later than the second calendar day after receipt of such report;(2) REPORTING AND DISCHARGE.—Any committee of the House of Representatives to which ajoint resolution is referred shall report it to theHouse not later than 5 calendar days after the dateof receipt of the report described in subsection(a)(3). If a committee fails to report the joint resolution within that period, the committee shall be discharged from further consideration of the joint resolution and the joint resolution shall be referred tothe appropriate calendar.(3) PROCEEDING TO CONSIDERATION.—Aftereach committee authorized to consider a joint resolution reports it to the House or has been dischargedfrom its consideration, it shall be in order, not laterthan the sixth day after Congress receives the reportdescribed in subsection (a)(3), to move to proceed toconsider the joint resolution in the House. All pointsof order against the motion are waived. Such a motion shall not be in order after the House has disposed of a motion to proceed on the joint resolution.The previous question shall be considered as orderedon the motion to its adoption without interveningS.L.C.motion. The motion shall not be debatable. A motionto reconsider the vote by which the motion is disposed of shall not be in order.(4) CONSIDERATION.—The joint resolutionshall be considered as read. All points of orderagainst the joint resolution and against its consideration are waived. The previous question shall be considered as ordered on the joint resolution to its passage without intervening motion except two hours ofdebate equally divided and controlled by the proponent and an opponent. A motion to reconsider thevote on passage of the joint resolution shall not bein order.(e) FAST TRACK CONSIDERATION IN SENATE.—(1) RECONVENING.—Upon receipt of a reportunder subsection (a)(3), if the Senate has adjournedor recessed for more than 2 days, the majority leader of the Senate, after consultation with the minorityleader of the Senate, shall notify the Members of theSenate that, pursuant to this section, the Senateshall convene not later than the second calendar dayafter receipt of such message.(2) PLACEMENT ON CALENDAR.—Upon introduction in the Senate, the joint resolution shall beplaced immediately on the calendar.S.L.C.(3) FLOOR CONSIDERATION.—(A) IN GENERAL.—Notwithstanding RuleXXII of the Standing Rules of the Senate, it isin order at any time during the period beginning on the 4th day after the date on whichCongress receives a report of the plan of theSecretary described in subsection (a)(3) andending on the 6th day after the date on whichCongress receives a report of the plan of theSecretary described in subsection (a)(3) (eventhough a previous motion to the same effect hasbeen disagreed to) to move to proceed to theconsideration of the joint resolution, and allpoints of order against the joint resolution (andagainst consideration of the joint resolution)are waived. The motion to proceed is not debatable. The motion is not subject to a motion topostpone. A motion to reconsider the vote bywhich the motion is agreed to or disagreed toshall not be in order. If a motion to proceed tothe consideration of the resolution is agreed to,the joint resolution shall remain the unfinishedbusiness until disposed of.(B) DEBATE.—Debate on the joint resolution, and on all debatable motions and appealsS.L.C.in connection therewith, shall be limited to notmore than 10 hours, which shall be dividedequally between the majority and minority leaders or their designees. A motion further to limitdebate is in order and not debatable. Anamendment to, or a motion to postpone, or amotion to proceed to the consideration of otherbusiness, or a motion to recommit the joint resolution is not in order.(C) VOTE ON PASSAGE.—The vote on passage shall occur immediately following the conclusion of the debate on a joint resolution, anda single quorum call at the conclusion of the debate if requested in accordance with the rules ofthe Senate.(D) RULINGS OF THE CHAIR ON PROCEDURE.—Appeals from the decisions of the Chairrelating to the application of the rules of theSenate, as the case may be, to the procedure relating to a joint resolution shall be decidedwithout debate.(f) RULES RELATING SENATE HOUSETO AND OFREPRESENTATIVES.—(1) COORDINATION WITH ACTION BY OTHERHOUSE.—If, before the passage by one House of ajoint resolution of thatbefore the passage by one House of aS.L.C.joint resolution of that House, that House receivesfrom the other House a joint resolution, then the following procedures shall apply:(A) The joint resolution of the other Houseshall not be referred to a committee.(B) With respect to a joint resolution ofthe House receiving the resolution—(i) the procedure in that House shallbe the same as if no joint resolution hadbeen received from the other House; but(ii) the vote on passage shall be onthe joint resolution of the other House.(2) TREATMENT OF JOINT RESOLUTION OFOTHER HOUSE.—If one House fails to introduce orconsider a joint resolution under this section, thejoint resolution of the other House shall be entitledto expedited floor procedures under this section.(3) TREATMENT OF COMPANION MEASURES.—If, following passage of the joint resolution in theSenate, the Senate then receives the companionmeasure from the House of Representatives, thecompanion measure shall not be debatable.(4) CONSIDERATION AFTER PASSAGE.—(A) IN GENERAL.—If Congress passes ajoint resolution, the period beginning on theS.L.C.date the President is presented with the jointresolution and ending on the date the Presidenttakes action with respect to the joint resolutionshall be disregarded in computing the 15-calendar day period described in subsection (a)(3).(B) VETOES.—If the President vetoes thejoint resolution—(i) the period beginning on the datethe President vetoes the joint resolutionand ending on the date the Congress receives the veto message with respect to thejoint resolution shall be disregarded incomputing the 15-calendar day period described in subsection (a)(3), and(ii) debate on a veto message in theSenate under this section shall be 1 hourequally divided between the majority andminority leaders or their designees.(5) RULES OF HOUSE OF REPRESENTATIVESAND SENATE.—This subsection and subsections (c),(d), and (e) are enacted by Congress—(A) as an exercise of the rulemaking powerof the Senate and House of Representatives, respectively, and as such it is deemed a part ofthe rules of each House, respectively, but appliO:\AYO\AYO08C32.xml S.L.C.cable only with respect to the procedure to befollowed in that House in the case of a jointresolution, and it supersedes other rules only tothe extent that it is inconsistent with suchrules; and(B) with full recognition of the constitutional right of either House to change the rules(so far as relating to the procedure of thatHouse) at any time, in the same manner, andto the same extent as in the case of any otherrule of that House.SEC. 116. OVERSIGHT AND AUDITS.(a) COMPTROLLER GENERAL OVERSIGHT.—(1) SCOPE OF OVERSIGHT.—The ComptrollerGeneral of the United States shall, upon establishment of the troubled assets relief program underthis Act (in this section referred to as the ‘‘TARP’’),commence ongoing oversight of the activities andperformance of the TARP and of any agents andrepresentatives of the TARP (as related to the agentor representative’s activities on behalf of or underthe authority of the TARP), including vehicles established by the Secretary under this Act. The subjects of such oversight shall include the following:S.L.C.(A) The performance of the TARP inmeeting the purposes of this Act, particularlythose involving—(i) foreclosure mitigation;(ii) cost reduction;(iii) whether it has provided stabilityor prevented disruption to the financialmarkets or the banking system; and(iv) whether it has protected taxpayers.(B) The financial condition and internalcontrols of the TARP, its representatives andagents.(C) Characteristics of transactions andcommitments entered into, including transaction type, frequency, size, prices paid, and allother relevant terms and conditions, and thetiming, duration and terms of any future commitments to purchase assets.(D) Characteristics and disposition of acquired assets, including type, acquisition price,current market value, sale prices and terms,and use of proceeds from sales.(E) Efficiency of the operations of theTARP in the use of appropriated funds.S.L.C.(F) Compliance with all applicable lawsand regulations by the TARP, its agents andrepresentatives.(G) The efforts of the TARP to prevent,identify, and minimize conflicts of interest involving any agent or representative performingactivities on behalf of or under the authority ofthe TARP.(H) The efficacy of contracting procedurespursuant to section 107(b), including, as applicable, the efforts of the TARP in evaluatingproposals for inclusion and contracting to themaximum extent possible of minorities (as suchterm is defined in 1204(c) of the Financial Institutions Reform, Recovery, and EnhancementAct of 1989 (12 U.S.C. 1811 note), women,and minority- and women-owned businesses, including ascertaining and reporting the totalamount of fees paid and other value deliveredby the TARP to all of its agents and representatives, and such amounts paid or delivered tosuch firms that are minority- and women-ownedbusinesses (as such terms are defined in section21A of the Federal Home Loan Bank Act (12U.S.C. 1441a)).S.L.C.(2) CONDUCT AND ADMINISTRATION OF OVERSIGHT.—(A) GAO PRESENCE.—The Secretary shallprovide the Comptroller General with appropriate space and facilities in the Department ofthe Treasury as necessary to facilitate oversightof the TARP until the termination date established in section 120.(B) ACCESS TO RECORDS.—To the extentotherwise consistent with law, the ComptrollerGeneral shall have access, upon request, to anyinformation, data, schedules, books, accounts,financial records, reports, files, electronic communications, or other papers, things, or property belonging to or in use by the TARP, orany vehicles established by the Secretary underthis Act, and to the officers, directors, employees, independent public accountants, financialadvisors, and other agents and representativesof the TARP (as related to the agent or representative’s activities on behalf of or under theauthority of the TARP) or any such vehicle atsuch reasonable time as the Comptroller General may request. The Comptroller Generalshall be afforded full facilities for verifyingS.L.C.transactions with the balances or securities heldby depositaries, fiscal agents, and custodians.The Comptroller General may make and retaincopies of such books, accounts, and otherrecords as the Comptroller General deems appropriate.(C) REIMBURSEMENT COSTS.—TheOFTreasury shall reimburse the Government Accountability Office for the full cost of any suchoversight activities as billed therefor by theComptroller General of the United States. Suchreimbursements shall be credited to the appropriation account ‘‘Salaries and Expenses, Government Accountability Office’’ current whenthe payment is received and remain availableuntil expended.(3) REPORTING.—The Comptroller Generalshall submit reports of findings under this section,regularly and no less frequently than once every 60days, to the appropriate committees of Congress,and the Special Inspector General for the TroubledAsset Relief Program established under this Act onthe activities and performance of the TARP. TheComptroller may also submit special reports underS.L.C.this subsection as warranted by the findings of itsoversight activities.(b) COMPTROLLER GENERAL AUDITS.—(1) ANNUAL AUDIT.—The TARP shall annuallyprepare and issue to the appropriate committees ofCongress and the public audited financial statementsprepared in accordance with generally accepted accounting principles, and the Comptroller Generalshall annually audit such statements in accordancewith generally accepted auditing standards. TheTreasury shall reimburse the Government Accountability Office for the full cost of any such audit asbilled therefor by the Comptroller General. Such reimbursements shall be credited to the appropriationaccount ‘‘Salaries and Expenses, Government Accountability Office’’ current when the payment is received and remain available until expended. The financial statements prepared under this paragraphshall be on the fiscal year basis prescribed undersection 1102 of title 31, United States Code.(2) AUTHORITY.—The Comptroller Generalmay audit the programs, activities, receipts, expenditures, and financial transactions of the TARP andany agents and representatives of the TARP (as related to the agent or representative’s activities onS.L.C.behalf of or under the authority of the TARP), including vehicles established by the Secretary underthis Act.(3) CORRECTIVE RESPONSES TO AUDIT PROBLEMS.—The TARP shall—(A) take action to address deficienciesidentified by the Comptroller General or otherauditor engaged by the TARP; or(B) certify to appropriate committees ofCongress that no action is necessary or appropriate.(c) INTERNAL CONTROL.—(1) ESTABLISHMENT.—The TARP shall establish and maintain an effective system of internalcontrol, consistent with the standards prescribedunder section 3512(c) of title 31, United StatesCode, that provides reasonable assurance of—(A) the effectiveness and efficiency of operations, including the use of the resources of theTARP;(B) the reliability of financial reporting, including financial statements and other reportsfor internal and external use; and(C) compliance with applicable laws andregulations.S.L.C.(2) REPORTING.—In conjunction with each annual financial statement issued under this section,the TARP shall—(A) state the responsibility of managementfor establishing and maintaining adequate internal control over financial reporting; and(B) state its assessment, as of the end ofthe most recent year covered by such financialstatement of the TARP, of the effectiveness ofthe internal control over financial reporting.(d) SHARING OF INFORMATION.—Any report or auditrequired under this section shall also be submitted to theCongressional Oversight Panel established under section125.(e) TERMINATION.—Any oversight, reporting, oraudit requirement under this section shall terminate onthe later of—(1) the date that the last troubled asset acquired by the Secretary under section 101 has beensold or transferred out of the ownership or controlof the Federal Government; or(2) the date of expiration of the last insurancecontract issued under section 102.S.L.C.SEC. 117. STUDY AND REPORT ON MARGIN AUTHORITY.(a) STUDY.—The Comptroller General shall undertake a study to determine the extent to which leverageand sudden deleveraging of financial institutions was afactor behind the current financial crisis.(b) CONTENT.—The study required by this sectionshall include—(1) an analysis of the roles and responsibilitiesof the Board, the Securities and Exchange Commission, the Secretary, and other Federal banking agencies with respect to monitoring leverage and actingto curtail excessive leveraging;(2) an analysis of the authority of the Board toregulate leverage, including by setting margin requirements, and what process the Board used to decide whether or not to use its authority;(3) an analysis of any usage of the margin authority by the Board; and(4) recommendations for the Board and appropriate committees of Congress with respect to theexisting authority of the Board.(c) REPORT.—Not later than June 1, 2009, theComptroller General shall complete and submit a reporton the study required by this section to the Committeeon Banking, Housing, and Urban Affairs of the SenateS.L.C.and the Committee on Financial Services of the House ofRepresentatives.(d) SHARING INFORMATION.—Any reports re OFquired under this section shall also be submitted to theCongressional Oversight Panel established under section125.SEC. 118. FUNDING.For the purpose of the authorities granted in thisAct, and for the costs of administering those authorities,the Secretary may use the proceeds of the sale of any securities issued under chapter 31 of title 31, United StatesCode, and the purposes for which securities may be issuedunder chapter 31 of title 31, United States Code, are extended to include actions authorized by this Act, includingthe payment of administrative expenses. Any funds expended or obligated by the Secretary for actions authorized by this Act, including the payment of administrativeexpenses, shall be deemed appropriated at the time of suchexpenditure or obligation.SEC. 119. JUDICIAL REVIEW AND RELATED MATTERS.(a) JUDICIAL REVIEW.—(1) STANDARD.—Actions by the Secretary pursuant to the authority of this Act shall be subject tochapter 7 of title 5, United States Code, includingthat such final actions shall be held unlawful and setS.L.C.aside if found to be arbitrary, capricious, an abuseof discretion, or not in accordance with law.(2) LIMITATIONS ON EQUITABLE RELIEF.—(A) INJUNCTION.—No injunction or otherform of equitable relief shall be issued againstthe Secretary for actions pursuant to section101, 102, 106, and 109, other than to remedya violation of the Constitution.(B) TEMPORARY RESTRAINING ORDER.—Any request for a temporary restraining orderagainst the Secretary for actions pursuant tothis Act shall be considered and granted or denied by the court within 3 days of the date ofthe request.(C) PRELIMINARY INJUNCTION.—Any request for a preliminary injunction against theSecretary for actions pursuant to this Act shallbe considered and granted or denied by thecourt on an expedited basis consistent with theprovisions of rule 65(b)(3) of the Federal Rulesof Civil Procedure, or any successor thereto.(D) PERMANENT INJUNCTION.—Any request for a permanent injunction against theSecretary for actions pursuant to this Act shallbe considered and granted or denied by theS.L.C.court on an expedited basis. Whenever possible,the court shall consolidate trial on the meritswith any hearing on a request for a preliminaryinjunction, consistent with the provisions of rule65(a)(2) of the Federal Rules of Civil Procedure, or any successor thereto.(3) LIMITATION ON ACTIONS BY PARTICIPATINGCOMPANIES.—No action or claims may be broughtagainst the Secretary by any person that divests itsassets with respect to its participation in a programunder this Act, except as provided in paragraph (1),other than as expressly provided in a written contract with the Secretary.(4) STAYS.—Any injunction or other form ofequitable relief issued against the Secretary for actions pursuant to section 101, 102, 106, and 109,shall be automatically stayed. The stay shall be lifted unless the Secretary seeks a stay from a highercourt within 3 calendar days after the date on whichthe relief is issued.(b) RELATED MATTERS.—(1) TREATMENT OF HOMEOWNERS’ RIGHTS.—The terms of any residential mortgage loan that ispart of any purchase by the Secretary under this Actshall remain subject to all claims and defenses thatS.L.C.would otherwise apply, notwithstanding the exerciseof authority by the Secretary under this Act.(2) SAVINGS CLAUSE.—Any exercise of the authority of the Secretary pursuant to this Act shallnot impair the claims or defenses that would otherwise apply with respect to persons other than theSecretary. Except as established in any contract, aservicer of pooled residential mortgages owes anyduty to determine whether the net present value ofthe payments on the loan, as modified, is likely tobe greater than the anticipated net recovery thatwould result from foreclosure to all investors andholders of beneficial interests in such investment,but not to any individual or groups of investors orbeneficial interest holders, and shall be deemed toact in the best interests of all such investors or holders of beneficial interests if the servicer agrees to orimplements a modification or workout plan when theservicer takes reasonable loss mitigation actions, including partial payments.SEC. 120. TERMINATION OF AUTHORITY.(a) TERMINATION.—The authorities provided undersections 101(a), excluding section 101(a)(3), and 102shall terminate on December 31, 2009.S.L.C.(b) EXTENSION UPON CERTIFICATION.—The Secretary, upon submission of a written certification to Congress, may extend the authority provided under this Actto expire not later than 2 years from the date of enactment of this Act. Such certification shall include a justification of why the extension is necessary to assist American families and stabilize financial markets, as well asthe expected cost to the taxpayers for such an extension.SEC. 121. SPECIAL INSPECTOR GENERAL FOR THE TROUBLED ASSET RELIEF PROGRAM.(a) OFFICE INSPECTOR GENERAL.—There isOFhereby established the Office of the Special Inspector General for the Troubled Asset Relief Program.(b) APPOINTMENT INSPECTOR GENERAL; RE OFMOVAL.—(1) The head of the Office of the Special Inspector General for the Troubled Asset Relief Program is theSpecial Inspector General for the Troubled Asset ReliefProgram (in this section referred to as the ‘‘Special Inspector General’’), who shall be appointed by the President, by and with the advice and consent of the Senate.(2) The appointment of the Special Inspector Generalshall be made on the basis of integrity and demonstratedability in accounting, auditing, financial analysis, law,management analysis, public administration, or investigations.S.L.C.(3) The nomination of an individual as Special Inspector General shall be made as soon as practicable afterthe establishment of any program under sections 101 and102.(4) The Special Inspector General shall be removablefrom office in accordance with the provisions of section3(b) of the Inspector General Act of 1978 (5 U.S.C. App.).(5) For purposes of section 7324 of title 5, UnitedStates Code, the Special Inspector General shall not beconsidered an employee who determines policies to be pursued by the United States in the nationwide administration of Federal law.(6) The annual rate of basic pay of the Special Inspector General shall be the annual rate of basic pay provided for positions at level IV of the Executive Scheduleunder section 5315 of title 5, United States Codeforan Inspector General under section 3(e) of the InspectorGeneral Act of 1978 (5 U.S.C. App.).(c) DUTIES.—(1) It shall be the duty of the SpecialInspector General to conduct, supervise, and coordinateaudits and investigations of the purchase, management,and sale of assets by the Secretary of the Treasury underany program established by the Secretary under section101, and the management by the Secretary of any program established under section 102, including by collecting and summarizing the following information:S.L.C.(A) A description of the categories of troubledassets purchased or otherwise procured by the Secretary.(B) A listing of the troubled assets purchasedin each such category described under subparagraph(A).(C) An explanation of the reasons the Secretarydeemed it necessary to purchase each such troubledasset.(D) A listing of each financial institution thatsuch troubled assets were purchased from.(E) A listing of and detailed biographical information on each person or entity hired to managesuch troubled assets.(F) A current estimate of the total amount oftroubled assets purchased pursuant to any programestablished under section 101, the amount of troubled assets on the books of the Treasury, theamount of troubled assets sold, and the profit andloss incurred on each sale or disposition of each suchtroubled asset.(G) A listing of the insurance contracts issuedunder section 102.(2) The Special Inspector General shall establish,maintain, and oversee such systems, procedures, and conO:\AYO\AYO08C32.xml S.L.C.trols as the Special Inspector General considers appropriate to discharge the duty under paragraph (1).(3) In addition to the duties specified in paragraphs(1) and (2), the Inspector General shall also have the duties and responsibilities of inspectors general under the Inspector General Act of 1978.(d) POWERS AND AUTHORITIES.—(1) In carrying outthe duties specified in subsection (c), the Special InspectorGeneral shall have the authorities provided in section 6of the Inspector General Act of 1978.(2) The Special Inspector General shall carry out theduties specified in subsection (c)(1) in accordance withsection 4(b)(1) of the Inspector General Act of 1978.(e) PERSONNEL, FACILITIES, OTHER RE ANDSOURCES.—(1) The Special Inspector General may select,appoint, and employ such officers and employees as maybe necessary for carrying out the duties of the Special Inspector General, subject to the provisions of title 5, UnitedStates Code, governing appointments in the competitiveservice, and the provisions of chapter 51 and subchapterIII of chapter 53 of such title, relating to classificationand General Schedule pay rates.(2) The Special Inspector General may obtain services as authorized by section 3109 of title 5, United StatesCode, at daily rates not to exceed the equivalent rate preO:\AYO\AYO08C32.xml S.L.C.scribed for grade GS–15 of the General Schedule by section 5332 of such title.(3) The Special Inspector General may enter intocontracts and other arrangements for audits, studies,analyses, and other services with public agencies and withprivate persons, and make such payments as may be necessary to carry out the duties of the Inspector General.(4)(A) Upon request of the Special Inspector Generalfor information or assistance from any department, agency, or other entity of the Federal Government, the headof such entity shall, insofar as is practicable and not incontravention of any existing law, furnish such information or assistance to the Special Inspector General, or anauthorized designee.(B) Whenever information or assistance requested bythe Special Inspector General is, in the judgment of theSpecial Inspector General, unreasonably refused or notprovided, the Special Inspector General shall report thecircumstances to the appropriate committees of Congresswithout delay.(f) REPORTS.—(1) Not later than 60 days after theconfirmation of the Special Inspector General, and everycalendar quarter thereafter, the Special Inspector Generalshall submit to the appropriate committees of Congressa report summarizing the activities of the Special InspecO:\AYO\AYO08C32.xml S.L.C.tor General during the 120-day period ending on the dateof such report. Each report shall include, for the periodcovered by such report, a detailed statement of all purchases, obligations, expenditures, and revenues associatedwith any program established by the Secretary of theTreasury under sections 101 and 102, as well as the information collected under subsection (c)(1).(2) Nothing in this subsection shall be construed toauthorize the public disclosure of information that is—(A) specifically prohibited from disclosure byany other provision of law;(B) specifically required by Executive order tobe protected from disclosure in the interest of national defense or national security or in the conductof foreign affairs; or(C) a part of an ongoing criminal investigation.(3) Any reports required under this section shall alsobe submitted to the Congressional Oversight Panel established under section 125.(g) FUNDING.—(1) Of the amounts made availableto the Secretary of the Treasury under section 118,$50,000,000 shall be available to the Special InspectorGeneral to carry out this section.(2) The amount available under paragraph (1) shallremain available until expended.S.L.C.(h) TERMINATION.—The Office of the Special Inspector General shall terminate on the later of—(1) the date that the last troubled asset acquired by the Secretary under section 101 has beensold or transferred out of the ownership or controlof the Federal Government; or(2) the date of expiration of the last insurancecontract issued under section 102.SEC. 122. INCREASE IN STATUTORY LIMIT ON THE PUBLICDEBT.Subsection (b) of section 3101 of title 31, UnitedStates Code, is amended by striking out the dollar limitation contained in such subsection contained in such subsection and inserting‘‘$11,315,000,000,000’’.SEC. 123. CREDIT REFORM.(a) IN GENERAL.—Subject to subsection (b), thecosts of purchases of troubled assets made under section101(a) and guarantees of troubled assets under section102, and any cash flows associated with the activities authorized in section 102 and subsections (a), (b), and (c)of section 106 shall be determined as provided under theFederal Credit Reform Act of 1990 (2 U.S.C. 661 et.seq.), as applicable.S.L.C.(b) COSTS.—For the purposes of section 502(5) ofthe Federal Credit Reform Act of 1990 (2 U.S.C.661a(5))—(1) the cost of troubled assets and guaranteesof troubled assets shall be calculated by adjustingthe discount rate in section 502(5)(E) (2 U.S.C.661a(5)(E)) for market risks; and(2) the cost of a modification of a troubledasset or guarantee of a troubled asset shall be thedifference between the current estimate consistentwith paragraph (1) under the terms of the troubledasset or guarantee of the troubled asset and the current estimate consistent with paragraph (1) underthe terms of the troubled asset or guarantee of thetroubled asset, as modified.SEC. 124. HOPE FOR HOMEOWNERS AMENDMENTS.Section 257 of the National Housing Act (12 U.S.C.1715z-23) is amended—(1) in subsection (e)—(A) in paragraph (1)(B), by inserting before ‘‘a ratio’’ the following: ‘‘, or thereafter islikely to have, due to the terms of the mortgagebeing reset,’’;(B) in paragraph (2)(B), by inserting before the period at the end ‘‘(or such higher perO:\AYO\AYO08C32.xml S.L.C.centage as the Board determines, in the discretion of the Board)’’;(C) in paragraph (4)(A)—(i) in the first sentence, by insertingafter ‘‘insured loan’’ the following: ‘‘andany payments made under this paragraph,’’; and(ii) by adding at the end the following: ‘‘Such actions may include makingpayments, which shall be accepted as payment in full of all indebtedness under theeligible mortgage, to any holder of an existing subordinate mortgage, in lieu of anyfuture appreciation payments authorizedunder subparagraph (B).’’; and(2) in subsection (w), by inserting after ‘‘administrative costs’’ the following: ‘‘and paymentspursuant to subsection (e)(4)(A)’’.SEC. 125. CONGRESSIONAL OVERSIGHT PANEL.(a) ESTABLISHMENT.—There is hereby establishedthe Congressional Oversight Panel (hereafter in this section referred to as the ‘‘Oversight Panel’’) as an establishment in the legislative branch.S.L.C.(b) DUTIES.—The Oversight Panel shall review thecurrent state of the financial markets and the regulatorysystem and submit the following reports to Congress:(1) REGULAR REPORTS.—(A) IN GENERAL.—Regular reports of theOversight Panel shall include the following:(i) The use by the Secretary of authority under this Act, including with respect to the use of contracting authorityand administration of the program.(ii) The impact of purchases madeunder the Act on the financial markets andfinancial institutions.(iii) The extent to which the information made available on transactions underthe program has contributed to markettransparency.(iv) The effectiveness of foreclosuremitigation efforts, and the effectiveness ofthe program from the standpoint of minimizing long-term costs to the taxpayersand maximizing the benefits for taxpayers.(B) TIMING.—The reports required underthis paragraph shall be submitted not laterthan 30 days after the first exercise by the Secretary of the authority under sectionO:\AYO\AYO08C32.xml S.L.C.retary of the authority under section 101(a) or102, and every 30 days thereafter.(2) SPECIAL RE REPORT ON REGULATORYFORM.—The Oversight Panel shall submit a specialreport on regulatory reform not later than January20, 2009, analyzing the current state of the regulatory system and its effectiveness at overseeing theparticipants in the financial system and protectingconsumers, and providing recommendations for improvement, including recommendations regardingwhether any participants in the financial marketsthat are currently outside the regulatory systemshould become subject to the regulatory system, therationale underlying such recommendation, andwhether there are any gaps in existing consumerprotections.(c) MEMBERSHIP.—(1) IN GENERAL.—The Oversight Panel shallconsist of 5 members, as follows:(A) 1 member appointed by the Speaker ofthe House of Representatives.(B) 1 member appointed by the minorityleader of the House of Representatives.(C) 1 member appointed by the majorityleader of the Senate.S.L.C.(D) 1 member appointed by the minorityleader of the Senate.(E) 1 member appointed by the Speaker ofthe House of Representatives and the majorityleader of the Senate, after consultation with theminority leader of the Senate and the minorityleader of the House of Representatives.(2) PAY.—Each member of the Oversight Panelshall each be paid at a rate equal to the daily equivalent of the annual rate of basic pay for level I ofthe Executive Schedule for each day (including travel time) during which such member is engaged inthe actual performance of duties vested in the Commission.(3) PROHIBITION OF COMPENSATION OF FEDEMPLOYEES.—Members of the OversightERALPanel who are full-time officers or employees of theUnited States or Members of Congress may not receive additional pay, allowances, or benefits by reason of their service on the Oversight Panel.(4) TRAVEL EXPENSES.—Each member shallreceive travel expenses, including per diem in lieu ofsubsistence, in accordance with applicable provisionsunder subchapter I of chapter 57 of title 5, UnitedStates Code.S.L.C.(5) QUORUM.—Four members of the OversightPanel shall constitute a quorum but a lesser numbermay hold hearings.(6) VACANCIES.—A vacancy on the OversightPanel shall be filled in the manner in which theoriginal appointment was made.(7) MEETINGS.—The Oversight Panel shallmeet at the call of the Chairperson or a majority ofits members.(d) STAFF.—(1) IN GENERAL.—The Oversight Panel mayappoint and fix the pay of any personnel as theCommission considers appropriate.(2) EXPERTS AND CONSULTANTS.—The Oversight Panel may procure temporary and intermittentservices under section 3109(b) of title 5, UnitedStates Code.(3) STAFF OF AGENCIES.—Upon request of theOversight Panel, the head of any Federal department or agency may detail, on a reimbursable basis,any of the personnel of that department or agencyto the Oversight Panel to assist it in carrying out itsduties under this Act.(e) POWERS.—S.L.C.(1) HEARINGS AND SESSIONS.—The OversightPanel may, for the purpose of carrying out this section, hold hearings, sit and act at times and places,take testimony, and receive evidence as the Panelconsiders appropriate and may administer oaths oraffirmations to witnesses appearing before it.(2) POWERS OF MEMBERS AND AGENTS.—Anymember or agent of the Oversight Panel may, if authorized by the Oversight Panel, take any actionwhich the Oversight Panel is authorized to take bythis section.(3) OBTAINING OFFICIAL DATA.—The Oversight Panel may secure directly from any department or agency of the United States informationnecessary to enable it to carry out this section. Uponrequest of the Chairperson of the Oversight Panel,the head of that department or agency shall furnishthat information to the Oversight Panel.(4) REPORTS .—The Oversight Panel shall receive and consider all reports required to be submitted to the Oversight Panel under this Act.(f) TERMINATION.—The Oversight Panel shall terminate 6 months after the termination date specified in section 120.(g) FUNDING FOR EXPENSES.—S.L.C.(1) AUTHORIZATION APPROPRIATIONS.—OFThere is authorized to be appropriated to the Oversight Panel such sums as may be necessary for anyfiscal year, half of which shall be derived from theapplicable account of the House of Representatives,and half of which shall be derived from the contingent fund of the Senate.(2) REIMBURSEMENT AMOUNTS.—AnOFamount equal to the expenses of the Oversight Panelshall be promptly transferred by the Secretary, fromtime to time upon the presentment of a statementof such expenses by the Chairperson of the Oversight Panel, from funds made available to the Secretary under this Act to the applicable fund of theHouse of Representatives and the contingent fund ofthe Senate, as appropriate, as reimbursement foramounts expended from such account and fundunder paragraph (1).SEC. 126. FDIC AUTHORITY.(a) IN GENERAL.—Section 18(a) of the Federal Deposit Insurance Act (12 U.S.C. 1828(a)) is amended byadding at the end the following new paragraph:‘‘(4) FALSE ADVERTISING, MISUSE OF FDICNAMES, AND MISREPRESENTATION TO INDICATE INSURED STATUS.—S.L.C.‘‘(A) PROHIBITION ADVER ON FALSETISING AND MISUSE OF FDIC NAMES.—No person may represent or imply that any deposit liability, obligation, certificate, or share is insured or guaranteed by the Corporation, if suchdeposit liability, obligation, certificate, or shareis not insured or guaranteed by the Corporation—‘‘(i) by using the terms ‘Federal Deposit’, ‘Federal Deposit Insurance’, ‘Federal Deposit Insurance Corporation’, anycombination of such terms, or the abbreviation ‘FDIC’ as part of the businessname or firm name of any person, including any corporation, partnership, businesstrust, association, or other business entity;or‘‘(ii) by using such terms or any otherterms, sign, or symbol as part of an advertisement, solicitation, or other document.‘‘(B) PROHIBITION ON MISREPRESENTATIONS OF INSURED STATUS.—No person mayknowingly misrepresent—‘‘(i) that any deposit liability, obligation, certificate, or share is insured, underS.L.C.this Act, if such deposit liability, obligation, certificate, or share is not so insured;or‘‘(ii) the extent to which or the manner in which any deposit liability, obligation, certificate, or share is insured underthis Act, if such deposit liability, obligation, certificate, or share is not so insured,to the extent or in the manner represented.‘‘(C) AUTHORITY OF THE APPROPRIATEFEDERAL BANKING AGENCY.—The appropriateFederal banking agency shall have enforcementauthority in the case of a violation of this paragraph by any person for which the agency is theappropriate Federal banking agency, or any institution-affiliated party thereof.‘‘(D) CORPORATION AUTHORITY IF THEAPPROPRIATE FEDERAL BANKING AGENCYFAILS TO FOLLOW RECOMMENDATION.—‘‘(i) RECOMMENDATION.—The Corporation may recommend in writing to theappropriate Federal banking agency thatthe agency take any enforcement actionauthorized under section 8 for purposes ofenforcement of this paragraph with respectS.L.C.to any person for which the agency is theappropriate Federal banking agency or anyinstitution-affiliated party thereof.‘‘(ii) AGENCY RESPONSE.—If the appropriate Federal banking agency does not,within 30 days of the date of receipt of arecommendation under clause (i), take theenforcement action with respect to thisparagraph recommended by the Corporation or provide a plan acceptable to theCorporation for responding to the situationpresented, the Corporation may take therecommended enforcement action againstsuch person or institution-affiliated party.‘‘(E) ADDITIONAL AUTHORITY.—In addition to its authority under subparagraphs (C)and (D), for purposes of this paragraph, theCorporation shall have, in the same manner andto the same extent as with respect to a Statenonmember insured bank—‘‘(i) jurisdiction over—‘‘(I) any person other than a person for which another agency is theappropriate Federal banking agencyor any institution-affiliated partythereof; and‘‘(II) any person thatS.L.C.or any institution-affiliated partythereof; and‘‘(II) any person that aids orabets a violation of this paragraph bya person described in subclause (I);and‘‘(ii) for purposes of enforcing the requirements of this paragraph, the authority of the Corporation under—‘‘(I) section 10(c) to conduct investigations; and‘‘(II) subsections (b), (c), (d) and(i) of section 8 to conduct enforcement actions.‘‘(F) OTHER PRESERVED.—NoACTIONSprovision of this paragraph shall be construedas barring any action otherwise available, underthe laws of the United States or any State, toany Federal or State agency or individual.’’.(b) ENFORCEMENT ORDERS.—Section 8(c) of theFederal Deposit Insurance Act (12 U.S.C. 1818(c)) isamended by adding at the end the following new paragraph:‘‘(4) FALSE ADVERTISING OR MISUSE OFNAMES TO INDICATE INSURED STATUS.—S.L.C.‘‘(A) TEMPORARY ORDER.—‘‘(i) IN GENERAL.—If a notice ofcharges served under subsection (b)(1)specifies on the basis of particular factsthat any person engaged or is engaging inconduct described in section 18(a)(4), theCorporation or other appropriate Federalbanking agency may issue a temporaryorder requiring—‘‘(I) the immediate cessation ofany activity or practice described,which gave rise to the notice ofcharges; and‘‘(II) affirmative action to prevent any further, or to remedy any existing, violation.‘‘(ii) EFFECT OF ORDER.—Any temporary order issued under this subparagraph shall take effect upon service.‘‘(B) EFFECTIVE PERIOD OF TEMPORARYORDER.—A temporary order issued under subparagraph (A) shall remain effective and enforceable, pending the completion of an administrative proceeding pursuant to subsection(b)(1) in connection S.L.C.(b)(1) in connection with the notice ofcharges—‘‘(i) until such time as the Corporation or other appropriate Federal bankingagency dismisses the charges specified insuch notice; or‘‘(ii) if a cease-and-desist order isissued against such person, until the effective date of such order.‘‘(C) CIVIL MONEY PENALTIES.—Any violation of section 18(a)(4) shall be subject tocivil money penalties, as set forth in subsection(i), except that for any person other than an insured depository institution or an institution-affiliated party that is found to have violated thisparagraph, the Corporation or other appropriate Federal banking agency shall not be required to demonstrate any loss to an insureddepository institution.’’.(c) UNENFORCEABILITY CERTAIN AGREE OFMENTS.—Section 13(c) of the Federal Deposit InsuranceAct (12 U.S.C. 1823(c)) is amended by adding at the endthe following new paragraph:‘‘(11) UNENFORCEABILITY OF CERTAIN AGREEMENTS.—No provision contained in any existing orS.L.C.future standstill, confidentiality, or other agreementthat, directly or indirectly—‘‘(A) affects, restricts, or limits the abilityof any person to offer to acquire or acquire,‘‘(B) prohibits any person from offering toacquire or acquiring, or‘‘(C) prohibits any person from using anypreviously disclosed information in connectionwith any such offer to acquire or acquisition of,all or part of any insured depository institution, including any liabilities, assets, or interest therein, inconnection with any transaction in which the Corporation exercises its authority under section 11 or13, shall be enforceable against or impose any liability on such person, as such enforcement or liabilityshall be contrary to public policy.’’.(d) TECHNICAL CONFORMING AMENDMENTS.—ANDSection 18 of the Federal Deposit Insurance Act (12U.S.C. 1828) is amended—(1) in subsection (a)(3)—(A) by striking ‘‘this subsection’’ the firstplace that term appears and inserting ‘‘paragraph (1)’’; andS.L.C.(B) by striking ‘‘this subsection’’ the second place that term appears and inserting‘‘paragraph (2)’’; and(2) in the heading for subsection (a), by striking ‘‘INSURANCE LOGO.—’’ and inserting ‘‘REPDEPOSIT INSURANCE.—’’.RESENTATIONS OFSEC. 127. COOPERATION WITH THE FBI.Any Federal financial regulatory agency shall cooperate with the Federal Bureau of Investigation and otherlaw enforcement agencies investigating fraud, misrepresentation, and malfeasance with respect to development,advertising, and sale of financial products.SEC. 128. ACCELERATION OF EFFECTIVE DATE.Section 203 of the Financial Services Regulatory Relief Act of 2006 (12 U.S.C. 461 note) is amended by striking ‘‘October 1, 2011’’ and inserting ‘‘October 1, 2008’’.SEC. 129. DISCLOSURES ON EXERCISE OF LOAN AUTHORITY.(a) IN GENERAL.—Not later than 7 days after thedate on which the Board exercises its authority under thethird paragraph of section 13 of the Federal Reserve Act(12 U.S.C. 343; relating to discounts for individuals, partnerships, and corporations) the Board shall provide to theCommittee on Banking, Housing, and Urban Affairs ofthe Senate and the Committee on FinancialS.L.C.the Senate and the Committee on Financial Services ofthe House of Representatives a report which includes—(1) the justification for exercising the authority;and(2) the specific terms of the actions of theBoard, including the size and duration of the lending, available information concerning the value ofany collateral held with respect to such a loan, therecipient of warrants or any other potential equity inexchange for the loan, and any expected cost to thetaxpayers for such exercise.(b) PERIODIC UPDATES.—The Board shall provideupdates to the Committees specified in subsection (a) notless frequently than once every 60 days while the subjectloan is outstanding, including—(1) the status of the loan;(2) the value of the collateral held by the Federal reserve bank which initiated the loan; and(3) the projected cost to the taxpayers of theloan.(c) CONFIDENTIALITY.—The information submittedto the Congress under this section may be kept confidential, upon the written request of the Chairman of theBoard, in which case it shall made available only to theS.L.C.Chairpersons and Ranking Members of the Committeesdescribed in subsection (a).(d) APPLICABILITY.—The provisions of this sectionshall be in force for all uses of the authority providedunder section 13 of the Federal Reserve Act occurringduring the period beginning on March 1, 2008 and endingon the after the date of enactment of this Act, and reportsdescribed in subsection (a) shall be required beginning notlater than 30 days after that date of enactment, with respect to any such exercise of authority.(e) SHARING INFORMATION.—Any reports re OFquired under this section shall also be submitted to theCongressional Oversight Panel established under section125.SEC. 130. TECHNICAL CORRECTIONS.(a) IN GENERAL.—Section 128(b)(2) of the Truth inLending Act (15 U.S.C. 1638(b)(2)), as amended by section 2502 of the Mortgage Disclosure Improvement Actof 2008 (Public Law 110-289), is amended—(1) in subparagraph (A), by striking ‘‘In thecase’’ and inserting ‘‘Except as provided in subparagraph (G), in the case’’; and(2) by amending subparagraph (G) to read asfollows:S.L.C.‘‘(G)(i) In the case of an extension of credit relating to a plan described in section101(53D) of title 11, United States Code—‘‘(I) the requirements of subparagraphs (A) through (E) shall not apply;and‘‘(II) a good faith estimate of the disclosures required under subsection (a) shallbe made in accordance with regulations ofthe Board under section 121(c) beforesuch credit is extended, or shall be delivered or placed in the mail not later than3 business days after the date on whichthe creditor receives the written applicationof the consumer for such credit, whicheveris earlier.‘‘(ii) If a disclosure statement furnishedwithin 3 business days of the written application (as provided under clause (i)(II)) containsan annual percentage rate which is subsequently rendered inaccurate, within the meaning of section 107(c), the creditor shall furnishanother disclosure statement at the time of settlement or consummation of the transaction.’’.S.L.C.(b) EFFECTIVE DATE.—The amendments made bysubsection (a) shall take effect as if included in theamendments made by section 2502 of the Mortgage Disclosure Improvement Act of 2008 (Public Law 110-289).SEC. 131. EXCHANGE STABILIZATION FUND REIMBURSEMENT.(a) REIMBURSEMENT.—The Secretary shall reimburse the Exchange Stabilization Fund established undersection 5302 of title 31, United States Code, for any fundsthat are used for the Treasury Money Market FundsGuaranty Program for the United States money marketmutual fund industry, from funds under this Act.(b) LIMITS USE EXCHANGE STABILIZATIONON OFFUND.—The Secretary is prohibited from using the Exchange Stabilization Fund for the establishment of anyfuture guaranty programs for the United States moneymarket mutual fund industry.SEC. 132. AUTHORITY TO SUSPEND MARK-TO-MARKET ACCOUNTING.(a) AUTHORITY.—The Securities and Exchange Commission shall have the authority under the securities laws(as such term is defined in section 3(a)(47) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(47)) to suspend, by rule, regulation, or order, the application ofStatement Number 157 of the Financial AccountingStandards Board for any issuer .L.C.Standards Board for any issuer (as such term is definedin section 3(a)(8) of such Act) or with respect to any classor category of transaction if the Commission determinesthat is necessary or appropriate in the public interest andis consistent with the protection of investors.(b) SAVINGS PROVISION.—Nothing in subsection (a)shall be construed to restrict or limit any authority of theSecurities and Exchange Commission under securitieslaws as in effect on the date of enactment of this Act.SEC. 133. STUDY ON MARK-TO-MARKET ACCOUNTING.(a) STUDY.—The Securities and Exchange Commission, in consultation with the Board and the Secretary,shall conduct a study on mark-to-market accountingstandards as provided in Statement Number 157 of theFinancial Accounting Standards Board, as such standardsare applicable to financial institutions, including depository institutions. Such a study shall consider at a minimum—(1) the effects of such accounting standards ona financial institution’s balance sheet;(2) the impacts of such accounting on bank failures in 2008;(3) the impact of such standards on the qualityof financial information available to investors;(4) the process used by the Financial S.L.C.(4) the process used by the Financial Accounting Standards Board in developing accountingstandards;(5) the advisability and feasibility of modifications to such standards; and(6) alternative accounting standards to thoseprovided in such Statement Number 157.(b) REPORT.—The Securities and Exchange Commission shall submit to Congress a report of such study beforethe end of the 90-day period beginning on the date of theenactment of this Act containing the findings and determinations of the Commission, including such administrative and legislative recommendations as the Commissiondetermines appropriate.SEC. 134. RECOUPMENT.Upon the expiration of the 5-year period beginningupon the date of the enactment of this Act, the enactment of this Act, theDirectorof the Office of Management and Budget, in consultationwith the Director of the Congressional Budget Office, shallsubmit a report to the Congress on the net amount withinthe Troubled Asset Relief Program under this Act. In anycase where there is a shortfall, the President shall submita legislative proposal that recoups from the financial industry an amount equal to the shortfall in order to ensureS.L.C.that the Troubled Asset Relief Program does not add tothe deficit or national debt.SEC. 135. PRESERVATION OF AUTHORITY.With the exception of section 131, nothing in this Actmay be construed to limit the authority of the Secretaryor the Board under any other provision of law.SEC. 136. TEMPORARY INCREASE IN DEPOSIT AND SHAREINSURANCE COVERAGE.(a) FEDERAL DEPOSIT INSURANCE ACT; TEMPORARY INCREASE IN DEPOSIT INSURANCE.—(1) INCREASED AMOUNT.—Effective only during the period beginning on the date of enactmentof this Act and ending on December 31, 2009, section 11(a)(1)(E) of the Federal Deposit InsuranceAct (12 U.S.C. 1821(a)(1)(E)) shall apply with‘‘$250,000’’ substituted for ‘‘$100,000’’.(2) TEMPORARY INCREASE NOT TO BE CONSIDERED FOR SETTING ASSESSMENTS.—The temporaryincrease in the standard maximum deposit insuranceamount made under paragraph (1) shall not betaken into account by the Board of Directors of theCorporation for purposes of setting assessmentsunder section 7(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1817(b)(2)).S.L.C.(3) BORROWING LIMITS TEMPORARILY LIFTED.—During the period beginning on the date of enactment of this Act and ending on December 31,2009, the Board of Directors of the Corporationmay request from the Secretary, and the Secretaryshall approve, a loan or loans in an amount oramounts necessary to carry out this subsection,without regard to the limitations on such borrowingunder section 14(a) and 15(c) of the Federal Deposit Insurance Act (12 U.S.C. 1824(a), 1825(c)).(b) FEDERAL CREDIT UNION ACT; TEMPORARY INSHARE INSURANCE.—CREASE IN(1) INCREASED AMOUNT.—Effective only during the period beginning on the date of enactmentof this Act and ending on December 31, 2009, section 207(k)(5) of the Federal Credit Union Act (12U.S.C. 1787(k)(5)) shall apply with ‘‘$250,000’’substituted for ‘‘$100,000’’.(2) TEMPORARY INCREASE NOT TO BE CONSIDERED FOR SETTING INSURANCE PREMIUMCHARGES.—The temporary increase in the standardmaximum share insurance amount made under paragraph (1) shall not be taken into account by the National Credit Union Administration Board for purposes of setting insurance premium charges underS.L.C.section 202(c)(2) of the Federal Credit Union Act(12 U.S.C. 1782(c)(2)).(3) BORROWING LIMITS TEMPORARILY LIFTED.—During the period beginning on the date of enactment of this Act and ending on December 31,2009, the National Credit Union AdministrationBoard may request from the Secretary, and the Secretary shall approve, a loan or loans in an amountor amounts necessary to carry out this subsection,without regard to the limitations on such borrowingunder section 203(d)(1) of the Federal Credit UnionAct (12 U.S.C. 1783(d)(1)).(c) NOT USE INFLATION ADJUSTMENTS.—FOR INThe temporary increase in the standard maximum depositinsurance amount made under this section shall not beused to make any inflation adjustment under section11(a)(1)(F) of the Federal Deposit Insurance Act (12U.S.C. 1821(a)(1)(F)) for purposes of that Act or theFederal Credit Union Act.TITLE II—BUDGET-RELATEDPROVISIONSSEC. 201. INFORMATION FOR CONGRESSIONAL SUPPORTAGENCIES.Upon request, and to the extent otherwise consistentwith law, all information used by the Secretary in connecO:\AYO\AYO08C32.xml S.L.C.tion with activities authorized under this Act (includingthe records to which the Comptroller General is entitledunder this Act) shall be made available to congressionalsupport agencies (in accordance with their obligations tosupport the Congress as set out in their authorizing statutes) for the purposes of assisting the committees of Congress with conducting oversight, monitoring, and analysisof the activities authorized under this Act.SEC. 202. REPORTS BY THE OFFICE OF MANAGEMENT ANDBUDGET AND THE CONGRESSIONAL BUDGETOFFICE.(a) REPORTS OFFICE MANAGEMENTBY THE OF ANDBUDGET.—Within 60 days of the first exercise of the authority granted in section 101(a), but in no case later thanDecember 31, 2008, and semiannually thereafter, the Office of Management and Budget shall report to the President and the Congress—(1) the estimate, notwithstanding section502(5)(F) of the Federal Credit Reform Act of 1990(2 U.S.C. 661a(5)(F)), as of the first business daythat is at least 30 days prior to the issuance of thereport, of the cost of the troubled assets, and guarantees of the troubled assets, determined in accordance with section 123;S.L.C.(2) the information used to derive the estimate,including assets purchased or guaranteed, pricespaid, revenues received, the impact on the deficitand debt, and a description of any outstanding commitments to purchase troubled assets; and(3) a detailed analysis of how the estimate haschanged from the previous report.Beginning with the second report under subsection (a), theOffice of Management and Budget shall explain the differences between the Congressional Budget Office estimates delivered in accordance with subsection (b) andprior Office of Management and Budget estimates.(b) REPORTS CONGRESSIONAL BUDGET OF BY THEFICE.—Within 45 days of receipt by the Congress of eachreport from the Office of Management and Budget undersubsection (a), the Congressional Budget Office shall report to the Congress the Congressional Budget Office’sassessment of the report submitted by the Office of Management and Budget, including—(1) the cost of the troubled assets and guarantees of the troubled assets,(2) the information and valuation methods usedto calculate such cost, and(3) the impact on the deficit and the debt.S.L.C.(c) FINANCIAL EXPERTISE.—In carrying out the duties in this subsection or performing analyses of activitiesunder this Act, the Director of the Congressional BudgetOffice may employ personnel and procure the services ofexperts and consultants.(d) AUTHORIZATION APPROPRIATIONS.—ThereOFare authorized to be appropriated such sums as may benecessary to produce reports required by this section.SEC. 203. ANALYSIS IN PRESIDENT’S BUDGET.(a) IN GENERAL.—Section 1105(a) of title 31,United States Code, is amended by adding at the end thefollowing new paragraph:‘‘(35) as supplementary materials, a separateanalysis of the budgetary effects for all prior fiscalyears, the current fiscal year, the fiscal year forwhich the budget is submitted, and ensuing fiscalyears of the actions the Secretary of the Treasuryhas taken or plans to take using any authority provided in the Emergency Economic Stabilization Actof 2008, including—‘‘(A) an estimate of the current value of allassets purchased, sold, and guaranteed underthe authority provided in the Emergency Economic Stabilization Act of 2008 using methodology required by the Federal Credit ReformS.L.C.Act of 1990 (2 U.S.C. 661 et seq.) and section123 of the Emergency Economic StabilizationAct of 2008;‘‘(B) an estimate of the deficit, the debtheld by the public, and the gross Federal debtusing methodology required by the FederalCredit Reform Act of 1990 and section 123 ofthe Emergency Economic Stabilization Act of2008;‘‘(C) an estimate of the current value of allassets purchased, sold, and guaranteed underthe authority provided in the Emergency Economic Stabilization Act of 2008 calculated on acash basis;‘‘(D) a revised estimate of the deficit, thedebt held by the public, and the gross Federaldebt, substituting the cash-based estimates insubparagraph (C) for the estimates calculatedunder subparagraph (A) pursuant to the Federal Credit Reform Act of 1990 and section 123of the Emergency Economic Stabilization Act of2008; and‘‘(E) the portion of the deficit which canbe attributed to any action taken by the Secretary using authority provided by the Emergency Economic Stabilization Act of 2008O:\AYO\AYO08C32.xml S.L.C.gency Economic Stabilization Act of 2008 andthe extent to which the change in the deficitsince the most recent estimate is due to a reestimate using the methodology required by theFederal Credit Reform Act of 1990 and section123 of the Emergency Economic StabilizationAct of 2008.’’(b) CONSULTATION.—In implementing this section,the Director of Office of Management and Budget shallconsult periodically, but at least annually, with the Committee on the Budget of the House of Representatives, theCommittee on the Budget of the Senate, and the Directorof the Congressional Budget Office.(c) EFFECTIVE DATE.—This section and the amendment made by this section shall apply beginning with respect to the fiscal year 2010 budget submission of thePresident.SEC. 204. EMERGENCY TREATMENT.All provisions of this Act are designated as an emergency requirement and necessary to meet emergency needspursuant to section 204(a) of S. Con. Res 21 (110th Congress), the concurrent resolution on the budget for fiscalyear 2008 and rescissions of any amounts provided in thisAct shall not be counted for purposes of budget enforcement.S.L.C.TITLE III—TAX PROVISIONSSEC. 301. GAIN OR LOSS FROM SALE OR EXCHANGE OFCERTAIN PREFERRED STOCK.(a) IN GENERAL.—For purposes of the Internal Revenue Code of 1986, gain or loss from the sale or exchangeof any applicable preferred stock by any applicable financial institution shall be treated as ordinary income or loss.(b) APPLICABLE PREFERRED STOCK.—For purposesof this section, the term ‘‘applicable preferred stock’’means any stock—(1) which is preferred stock in—(A) the Federal National Mortgage Association, established pursuant to the Federal National Mortgage Association Charter Act (12U.S.C. 1716 et seq.), or(B) the Federal Home Loan MortgageCorporation, established pursuant to the Federal Home Loan Mortgage Corporation Act (12U.S.C. 1451 et seq.), and(2) which—(A) was held by the applicable financial institution on September 6, 2008, or(B) was sold or exchanged by the applicable financial institution on or after January 1,2008, and before September 7, 2008.S.L.C.(c) APPLICABLE FINANCIAL INSTITUTION.—For purposes of this section:(1) IN GENERAL.—Except as provided in paragraph (2), the term ‘‘applicable financial institution’’means—(A) a financial institution referred to insection 582(c)(2) of the Internal Revenue Codeof 1986, or(B) a depository institution holding company (as defined in section 3(w)(1) of the Federal Deposit Insurance Act (12 Deposit Insurance Act (12 U.S.C.1813(w)(1))).(2) SPECIAL RULES FOR CERTAIN SALES.—Inthe case of—(A) a sale or exchange described in subsection (b)(2)(B), an entity shall be treated asan applicable financial institution only if it wasan entity described in subparagraph (A) or (B)of paragraph (1) at the time of the sale or exchange, and(B) a sale or exchange after September 6,2008, of preferred stock described in subsection(b)(2)(A), an entity shall be treated as an applicable financial institution only if it was an entity described in subparagraph (A) or (B) ofS.L.C.paragraph (1) at all times during the period beginning on September 6, 2008, and ending onthe date of the sale or exchange of the preferred stock.(d) SPECIAL RULE CERTAIN PROPERTY NOTFORHELD SEPTEMBER 6, 2008.—The Secretary of theONTreasury or the Secretary’s delegate may extend the application of this section to all or a portion of the gain orloss from a sale or exchange in any case where—(1) an applicable financial institution sells orexchanges applicable preferred stock after September 6, 2008, which the applicable financial institution did not hold on such date, but the basis ofwhich in the hands of the applicable financial institution at the time of the sale or exchange is thesame as the basis in the hands of the person whichheld such stock on such date, or(2) the applicable financial institution is a partner in a partnership which—(A) held such stock on September 6, 2008,and later sold or exchanged such stock, or(B) sold or exchanged such stock duringthe period described in subsection (b)(2)(B).(e) REGULATORY AUTHORITY.—The Secretary of theTreasury or the Secretary’s delegate may prescribe suchS.L.C.guidance, rules, or regulations as are necessary to carryout the purposes of this section.(f) EFFECTIVE DATE.—This section shall apply tosales or exchanges occurring after December 31, 2007, intaxable years ending after such date.SEC. 302. SPECIAL RULES FOR TAX TREATMENT OF EXECUTIVE COMPENSATION OF EMPLOYERS PARTICIPATING IN THE TROUBLED ASSETS RELIEF PROGRAM.(a) DENIAL DEDUCTION.—Subsection (m) of sec OFtion 162 of the Internal Revenue Code of 1986 is amendedby adding at the end the following new paragraph:‘‘(5) SPECIAL RULE FOR APPLICATION TO EMPLOYERS PARTICIPATING IN THE TROUBLED ASSETSRELIEF PROGRAM.—‘‘(A) IN GENERAL.—In the case of an applicable employer, no deduction shall be allowedunder this chapter—‘‘(i) in the case of executive remuneration for any applicable taxable year whichis attributable to services performed by acovered executive during such applicabletaxable year, to the extent that the amountof such remuneration exceeds $500,000, or‘‘(ii) in the case of deferred S.L.C.‘‘(ii) in the case of deferred deductionexecutive remuneration for any taxableyear for services performed during any applicable taxable year by a covered executive, to the extent that the amount of suchremuneration exceeds $500,000 reduced(but not below zero) by the sum of—‘‘(I) the executive remunerationfor such applicable taxable year, plus‘‘(II) the portion of the deferreddeduction executive remuneration forsuch services which was taken into account under this clause in a precedingtaxable year.‘‘(B) APPLICABLE EMPLOYER.—For purposes of this paragraph—‘‘(i) IN GENERAL.—Except purposes of this paragraph—‘‘(i) IN GENERAL.—Except as provided in clause (ii), the term ‘applicableemployer’ means any employer from whom1 or more troubled assets are acquiredunder a program established by the Secretary under section 101(a) of the Emergency Economic Stabilization Act of 2008if the aggregate amount of the assets soacquired for all taxableS.L.C.acquired for all taxable years exceeds$300,000,000.‘‘(ii) DISREGARD OF CERTAIN ASSETSPURCHASE.—IfSOLD THROUGH DIRECTthe only sales of troubled assets by an employer under the program described inclause (i) are through 1 or more directpurchases (within the meaning of section113(c) of the Emergency Economic Stabilization Act of 2008), such assets shallnot be taken into account under clause (i)in determining whether the employer is anapplicable employer for purposes of thisparagraph.‘‘(iii) AGGREGATION RULES.—Two ormore persons who are treated as a singleemployer under subsection (b) or (c) ofsection 414 shall be treated as a single employer, except that in applying section1563(a) for purposes of either such subsection, paragraphs (2) and (3) thereofshall be disregarded.‘‘(C) APPLICABLE TAXABLE YEAR.—Forpurposes of this paragraph, the term ‘applicableS.L.C.taxable year’ means, with respect to any employer—‘‘(i) the first taxable year of the first taxable year of the employer—‘‘(I) which includes any portionof the period during which the authorities under section 101(a) of theEmergency Economic StabilizationAct of 2008 are in effect (determinedunder section 120 thereof), and‘‘(II) in which the aggregateamount of troubled assets acquiredfrom the employer during the taxableyear pursuant to such authorities(other than assets to which subparagraph (B)(ii) applies), when added tothe aggregate amount so acquired forall preceding taxable years, exceeds$300,000,000, and‘‘(ii) any subsequent taxable yearwhich includes any portion of such period.‘‘(D) COVERED EXECUTIVE.—For purposes of this paragraph—‘‘(i) IN GENERAL.—The purposes of this paragraph—S.L.C.‘‘(i) IN GENERAL.—The term ‘coveredexecutive’ means, with respect to any applicable taxable year, any employee—‘‘(I) who, at any time during theportion of the taxable year duringwhich the authorities under section101(a) of the Emergency EconomicStabilization Act of 2008 are in effect(determined under section 120 thereof), is the chief executive officer of theapplicable employer or the chief financial officer of the applicable employer,or an individual acting in either suchcapacity, or‘‘(II) who is described in clause(ii).‘‘(ii) HIGHEST EM COMPENSATEDPLOYEES.—An employee is described inthis clause if the employee is 1 of the 3highest compensated officers of the applicable employer for the taxable year (otherthan an individual described in clause(i)(I)), determined—‘‘(I) on the basis of the shareholder disclosure rules for compensaO:\AYO\AYO08C32.xml S.L.C.tion under the Securities ExchangeAct of 1934 (without regard to whether those rules apply to the employer),and‘‘(II) by only taking into accountemployees employed during the portion of the taxable year described inclause (i)(I).‘‘(iii) EMPLOYEE REMAINS COVEREDEXECUTIVE.—If an employee is a coveredexecutive with respect to an applicable employer for any applicable taxable year, suchemployee shall be treated as a covered executive with respect to such employer forall subsequent applicable taxable years andfor all subsequent taxable years in whichdeferred deduction executive remunerationwith respect to services performed in allsuch applicable taxable years would (butfor this paragraph) be deductible.‘‘(E) EXECUTIVE REMUNERATION.—Forpurposes of this paragraph, the term ‘executiveremuneration’ means the applicable employeeremuneration of the covered executive, as determined under paragraph (4) without regard toS.L.C.subparagraphs (B), (C), and (D) thereof. Suchterm shall not include any deferred deductionexecutive remuneration with respect to servicesperformed in a prior applicable taxable year.‘‘(F) DEFERRED DEDUCTION EXECUTIVEREMUNERATION.—For purposes of this paragraph, the term ‘deferred deduction executiveremuneration’ means remuneration which wouldbe executive remuneration for services performed in an applicable taxable year but for thefact that the deduction under this chapter (determined without regard to this paragraph) forsuch remuneration is allowable in a subsequenttaxable year.‘‘(G) COORDINATION.—Rules similar tothe rules of subparagraphs (F) and (G) of paragraph (4) shall apply for purposes of this paragraph.‘‘(H) REGULATORY AUTHORITY.—The Secretary mayAUTHORITY.—The Secretary may prescribe such guidance, rules, orregulations as are necessary to carry out thepurposes of this paragraph and the EmergencyEconomic Stabilization Act of 2008, includingthe extent to which this paragraph applies inS.L.C.the case of any acquisition, merger, or reorganization of an applicable employer.’’.(b) GOLDEN PARACHUTE RULE.—Section 280G ofthe Internal Revenue Code of 1986 is amended—(1) by redesignating subsection (e) as subsection (f), and(2) by inserting after subsection (d) the following new subsection:‘‘(e) SPECIAL RULE APPLICATION EMPLOY FOR TOPARTICIPATING TROUBLED ASSETS RELIEFERS IN THEPROGRAM.—‘‘(1) IN GENERAL.—In the case of the severance from employment of a covered executive of anapplicable employer during the period during whichthe authorities under section 101(a) of the Emergency Economic Stabilization Act of 2008 are in effect (determined under section 120 of such Act), thissection shall be applied to payments to such executive with the following modifications:‘‘(A) Any reference to a disqualified individual (other than in subsection (c)) shall betreated as a reference to a covered executive.‘‘(B) Any reference to a change describedin subsection (b)(2)(A)(i) shall be treated as areference to an applicable severance from emO:\AYO\AYO08C32.xml S.L.C.ployment of a covered executive, and any reference to a payment contingent on such achange shall be treated as a reference to anypayment made during an applicable taxableyear of the employer on account of such applicable severance from employment.‘‘(C) Any reference to a corporation shallbe treated as a reference to an applicable employer.‘‘(D) The provisionsThe provisions of subsections(b)(2)(C), (b)(4), (b)(5), and (d)(5) shall notapply.‘‘(2) DEFINITIONS AND SPECIAL RULES.—Forpurposes of this subsection:‘‘(A) DEFINITIONS.—Any term used inthis subsection which is also used in section162(m)(5) shall have the meaning given suchterm by such section.‘‘(B) APPLICABLE SEVERANCE FROM EMPLOYMENT.—The term ‘applicable severancefrom employment’ means any severance fromemployment of a covered executive—‘‘(i) by reason of an involuntary termination of the executive by the employer,orS.L.C.‘‘(ii) in connection with any bankruptcy, liquidation, or receivership of theemployer.‘‘(C) COORDINATION ANDCOORDINATION AND OTHERRULES.—‘‘(i) IN GENERAL.—If a paymentwhich is treated as a parachute paymentby reason of this subsection is also a parachute payment determined without regardto this subsection, this subsection shall notapply to such payment.‘‘(ii) REGULATORY AUTHORITY.—TheSecretary may prescribe such guidance,rules, or regulations as are necessary—‘‘(I) to carry out the purposes ofthis subsection and the EmergencyEconomic Stabilization Act of 2008,including the extent to which this subsection applies in the case of any acquisition, merger, or reorganization ofan applicable employer,‘‘(II) to apply this section andsection 4999 in cases where one ormore payments with respect to any individual are treated as parachute payO:\AYO\AYO08C32.xml S.L.C.ments by reason of this subsection,and other payments with respect tosuch individual are treated as parachute payments under this sectionwithout regard to this subsection, and‘‘(III) to prevent the avoidance ofthe application of this section throughthe mischaracterization of a severancefrom employment as other than anapplicable severance from employment.’’.(c) EFFECTIVE DATES.—(1) IN GENERAL.—The amendment made bysubsection (a) shall apply to taxable years ending onor after the date of the enactment of this Act.(2) GOLDEN PARACHUTE RULE.—The amendments made by subsection (b) shall apply to payments with respect to severances occurring duringthe period during which the authorities under section 101(a) of this Act are in effect (determinedunder section 120 of this Act).S.L.C.SEC. 303. EXTENSION OF EXCLUSION OF INCOME FROMDISCHARGE OF QUALIFIED PRINCIPAL RESIDENCE INDEBTEDNESS.(a) EXTENSION.—Subparagraph (E) of section108(a)(1) of the Internal Revenue Code of 1986 is amended by striking ‘‘January 1, 2010’’ and inserting ‘‘January1, 2013’’.(b) EFFECTIVE DATE.—The amendment made bythis section shall apply to discharges of indebtedness occurring on or after January 1, 2010.DIVISION B—ENERGY IMPROVE11MENT AND EXTENSION ACTOF 2008SECTION 1. SHORT TITLE, ETC.(a) EXTENSIONSHORT TITLE.—This division may be cited as the‘‘Energy Improvement and Extension Act of 2008’’.(b) REFERENCE.—Except as otherwise expressly provided, whenever in this division an amendment or repealis expressed in terms of an amendment to, or repeal of,a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.(c) TABLE CONTENTS.—The table of contents forOFthis division is as follows:Sec. 1. Short title, etc.TITLE I—ENERGY PRODUCTION INCENTIVESS.L.C.Subtitle A—Renewable Energy IncentivesSec. 101. Renewable energy credit.Sec. 102. Production credit for electricity produced from marine renewables.Sec. 103. Energy credit.Sec. 104. Energy credit for small wind property.Sec. 105. Energy credit for geothermal heat pump systems.Sec. 106. Credit for residential energy efficient property.Sec. 107. New clean renewable energy bonds.Sec. 108. Credit for steel industry fuel.Sec. 109. Special rule to implement FERC and State electric restructuring pol icy.Subtitle B—Carbon Mitigation and Coal ProvisionsSec. 111. Expansion and modification of advanced coal project investment cred it.Sec. 112. Expansion and modification of coal gasification investment credit.Sec. 113. Temporary increase in coal excise tax; funding of Black Lung Dis ability Trust Fund.Sec. 114. Special rules for refund of the coal excise tax to certain coal pro ducers and exporters.Sec. 115. Tax credit for carbon dioxide sequestration.Sec. 116. Certain income and gains relating to industrial source carbon dioxidetreated as qualifying income for publicly traded partnerships.Sec. 117. Carbon audit of the tax code.TITLE II—TRANSPORTATION AND DOMESTIC FUEL SECURITYPROVISIONSSec. 201. Inclusion of cellulosic biofuel in bonus depreciation for biomass eth anol plant property.Sec. 202. Credits for biodiesel and renewable diesel.Sec. 203. Clarification that credits for fuel are designed to provide an incentivefor United States production.Sec. 204. Extension and modification of alternative fuel credit.Sec. 205. Credit for new qualified plug-in electric drive motor vehicles.Sec. 206. Exclusion from heavy truck tax for idling reduction units and ad vanced insulation.Sec. 207. Alternative fuel vehicle refueling property credit.Sec. 208. Certain income and gains relating to alcohol fuels and mixtures, bio diesel fuels and mixtures, and alternative fuels and mixturestreated as qualifying income for publicly traded partnerships.Sec. 209. Extension and modification of election to expense certain refineries.Sec. 210. Extension of suspension of taxable income limit on percentage deple tion for oil and natural gas produced from marginal properties.Sec. 211. Transportation fringe benefit to bicycle commuters.TITLE III—ENERGY CONSERVATION AND EFFICIENCYPROVISIONSSec. 301. Qualified energy conservation bonds.Sec. 302. Credit for nonbusiness energy property.Sec. 303. Energy efficient commercial buildings deduction.Sec. 304. New energy efficient home credit.Sec. 305. Modifications of energy efficient appliance credit for appliances pro duced after 2007.S.L.C.Sec. 306. Accelerated recovery period for depreciation of smart meters andsmart grid systems.Sec. 307. Qualified green building and sustainable design projects.Sec. 308. Special depreciation allowance for certain reuse and recycling prop erty.TITLE IV—REVENUE PROVISIONSSec. 401. Limitation of deduction for income attributable to domestic produc tion of oil, gas, or primary products thereof.Sec. 402. Elimination of the different treatment of foreign oil and gas extrac tion income and foreign oil related income for purposes of theforeign tax credit.Sec. 403. Broker reporting of customer’s basis in securities transactions.Sec. 404. 0.2 percent FUTA surtax.Sec. 405. Increase and extension of Oil Spill Liability Trust Fund tax.TITLE I—ENERGY PRODUCTIONINCENTIVESSubtitle A—Renewable EnergyIncentivesSEC. 101. RENEWABLE ENERGY CREDIT.(a) EXTENSION OF CREDIT.—(1) 1-YEAR EXTENSION FOR WIND AND REFINED COAL FACILITIES.—Paragraphs (1) and (8)of section 45(d) are each amended by striking ‘‘January 1, 2009’’ and inserting ‘‘January 1, 2010’’.(2) 2-YEAR EXTENSION FOR CERTAIN OTHERFACILITIES.—Each of the following provisions ofsection 45(d) is amended by striking ‘‘January 1,2009’’ and inserting ‘‘January 1, 2011’’:(A) Clauses (i) and (ii) of paragraph(2)(A).(B) Clauses (i)(I) and (ii) of paragraph(3)(A).S.L.C.(C) Paragraph (4).(D) Paragraph (5).(E) Paragraph (6).(F) Paragraph (7).(G) Subparagraphs (A) and (B) of paragraph (9).(b) MODIFICATION REFINED COAL QUALI OF AS AENERGY RESOURCE.—FIED(1) ELIMINATION OF INCREASED MARKETVALUE TEST.—Section 45(c)(7)(A)(i) (defining refined coal), as amended by section 108, is amended—(A) by striking subclause (IV),(B) by adding ‘‘and’’ at the end of subclause (II), and(C) by striking ‘‘, and’’ at the end of subclause (III) and inserting a period.(2) INCREASE IN REQUIRED EMISSION REDUCTION.—Section 45(c)(7)(B) (defining qualified emission reduction) is amended by inserting ‘‘at least 40percent of the emissions of’’ after ‘‘nitrogen oxideand’’.(c) TRASH FACILITY CLARIFICATION.—Paragraph(7) of section 45(d) is amended—S.L.C.(1) by striking ‘‘facility which burns’’ and inserting ‘‘facility (other than a facility described inparagraph (6)) which uses’’, and(2) by striking ‘‘COMBUSTION’’.(d) EXPANSION OF BIOMASS FACILITIES.—(1) OPEN-LOOP BIOMASS FACILITIES.—Paragraph (3) of section 45(d) is amended by redesignating subparagraph (B) as subparagraph (C) andby inserting after subparagraph (A) the followingnew subparagraph:‘‘(B) EXPANSION FACILITY.—SuchOFterm shall include a new unit placed in serviceafter the date of the enactment of this subparagraph in connection with a facility described insubparagraph (A), but only to the extent of theincreased amount of electricity produced at thefacility by reason of such new unit.’’.(2) CLOSED-LOOP BIOMASS FACILITIES.—Paragraph (2) of section 45(d) is amended by redesignating subparagraph (B) as subparagraph (C) andinserting after subparagraph (A) the following newsubparagraph:‘‘(B) EXPANSION FACILITY.—SuchOFterm shall include a new unit placed in serviceafter the date of the enactment of this subparaO:\AYO\AYO08C32.xml S.L.C.graph in connection with a facility described insubparagraph (A)(i), but only to the extent ofthe increased amount of electricity produced atthe facility by reason of such new unit.’’.(e) MODIFICATION RULES HYDROPOWEROF FORPRODUCTION.—Subparagraph (C) of section 45(c)(8) isamended to read as follows:‘‘(C) NONHYDROELECTRIC DAM.—For purposes of subparagraph (A), a facility is described in this subparagraph if—‘‘(i) the hydroelectric project installedon the nonhydroelectric dam is licensed bythe Federal Energy Regulatory Commission and meets all other applicable environmental, licensing, and regulatory requirements,‘‘(ii) the nonhydroelectric dam wasplaced in service before the date of the enactment of this paragraph and operatedfor flood control, navigation, or water supply purposes and did not produce hydroelectric power on the date of the enactmentof this paragraph, and‘‘(iii) the hydroelectric project is operated so that the water surface elevation atS.L.C.any given location and time that wouldhave occurred in the absence of the hydroelectric project is maintained, subject toany license requirements imposed underapplicable law that change the water surface elevation for the purpose of improvingenvironmental quality of the affected waterway.The Secretary, in consultation with the FederalEnergy Regulatory Commission, shall certify ifa hydroelectric project licensed at a nonhydroelectric dam meets the criteria in clause (iii).Nothing in this section shall affect the standards under which the Federal Energy Regulatory Commission issues licenses for and regulates hydropower projects under part I of theFederal Power Act.’’.(f) EFFECTIVE DATE.—(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments made bythis section shall apply to property originally placedin service after December 31, 2008.(2) REFINED COAL.—The amendments made bysubsection (b) shall apply to coal produced and soldS.L.C.from facilities placed in service after December 31,2008.(3) TRASH CLARIFICATION.—TheFACILITYamendments made by subsection (c) shall apply toelectricity produced and sold after the date of theenactment of this Act.(4) EXPANSION OF BIOMASS FACILITIES.—Theamendments made by subsection (d) shall apply toproperty placed in service after the date of the enactment of this Act.SEC. 102. PRODUCTION CREDIT FOR ELECTRICITY PRODUCED FROM MARINE RENEWABLES.(a) IN GENERAL.—Paragraph (1) of section 45(c) isamended by striking ‘‘and’’ at the end of subparagraph(G), by striking the period at the end of subparagraph(H) and inserting ‘‘, and’’, and by adding at the end thefollowing new subparagraph:‘‘(I) marine and hydrokinetic renewable energy.’’.(b) MARINE RENEWABLES.—Subsection (c) of section 45 is amended by adding at the end the followingnew paragraph:‘‘(10) MARINE RENEW AND HYDROKINETICABLE ENERGY.—S.L.C.‘‘(A) IN GENERAL.—The term ‘marine andhydrokinetic renewable energy’ means energyderived from—‘‘(i) waves, tides, and currents inoceans, estuaries, and tidal areas,‘‘(ii) free flowing water in rivers,lakes, and streams,‘‘(iii) free flowing water in an irrigation system, canal, or other man-madechannel, including projects that utilize nonmechanical structures to accelerate theflow of water for electric power productionpurposes, or‘‘(iv) differentials in ocean temperature (ocean thermal energy conversion).‘‘(B) EXCEPTIONS.—Such term shall notinclude any energy which is derived from anysource which utilizes a dam, diversionary structure (except as provided in subparagraph(A)(iii)), or impoundment for electric powerproduction purposes.’’.(c) DEFINITION FACILITY.—Subsection (d) ofOFsection 45 is amended by adding at the end the followingnew paragraph:S.L.C.‘‘(11) MARINE RENEW AND HYDROKINETICABLE ENERGY FACILITIES.—In the case of a facilityproducing electricity from marine and hydrokineticrenewable energy, the term ‘qualified facility’ meansany facility owned by the taxpayer—‘‘(A) which has a nameplate capacity rating of at least 150 kilowatts, and‘‘(B) which is originally placed in serviceon or after the date of the enactment of thisparagraph and before January 1, 2012.’’.(d) CREDIT RATE.—Subparagraph (A) of section45(b)(4) is amended by striking ‘‘or (9)’’ and inserting‘‘(9), or (11)’’.(e) COORDINATION WITH SMALL IRRIGATIONPOWER.—Paragraph (5) of section 45(d), as amended bysection 101, is amended by striking ‘‘January 1, 2012’’and inserting ‘‘the date of the enactment of paragraph(11)’’.(f) EFFECTIVE DATE.—The amendments made bythis section shall apply to electricity produced and soldafter the date of the enactment of this Act, in taxableyears ending after such date.SEC. 103. ENERGY CREDIT.(a) EXTENSION OF CREDIT.—S.L.C.(1) SOLAR PROPERTY.—ParagraphsENERGY(2)(A)(i)(II) and (3)(A)(ii) of section 48(a) are eachamended by striking ‘‘January 1, 2009’’ and inserting ‘‘January 1, 2017’’.(2) FUEL CELL PROPERTY.—Subparagraph (E) of section108(a)(1) of the Internal Revenue Code of 1986of section 48(c)(1) is amended by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31, 2016’’.(3) MICROTURBINE PROPERTY.—Subparagraph(E) of section 48(c)(2) is amended by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31,2016’’.(b) ALLOWANCE ENERGY CREDIT AGAINST AL OFMINIMUM TAX.—TERNATIVE(1) IN GENERAL.—Subparagraph (B) of section38(c)(4), as amended by the Housing AssistanceTax Act of 2008, is amended by redesignating clause(vi) as clause (vi) and (vii), respectively, and by inserting after clause (iv) the following new clause:‘‘(v) the credit determined under section 46 to the extent that such credit is attributable to the energy credit determinedunder section 48,’’.(2) TECHNICAL AMENDMENT.—Clause (vi) ofsection 38(c)(4)(B), as redesignated by paragraph(1), is amended by striking ‘‘section 47 to the extentS.L.C.attributable to’’ and inserting ‘‘section 46 to the extent that such credit is attributable to the rehabilitation credit under section 47, but only with respectto’’.(c) ENERGY CREDIT COMBINED HEATFOR ANDPOWER SYSTEM PROPERTY.—(1) IN GENERAL.—Section 48(a)(3)(A) isamended by striking ‘‘or’’ at the end of clause (iii),by inserting ‘‘or’’ at the end of clause (iv), and byadding at the end the following new clause:‘‘(v) combined heat and power systemproperty,’’.(2) COMBINED HEAT AND POWER SYSTEMPROPERTY.—Subsection (c) of section 48 is amended—(A) by striking ‘‘QUALIFIED FUEL CELLPROPERTY; QUALIFIED MICROTURBINE PROPERTY’’ in the heading and inserting ‘‘DEFINITIONS’’, and(B) by adding at the end the following newparagraph:‘‘(3) COMBINED HEAT AND POWER SYSTEMPROPERTY.—‘‘(A) COMBINED HEAT AND POWER SYSTEM PROPERTY.—The term ‘combined heat andS.L.C.power system property’ means property comprising a system—‘‘(i) which uses the same energysource for the simultaneous or sequentialgeneration of electrical power, mechanicalshaft power, or both, in combination withthe generation of steam or other forms ofuseful thermal energy (including heatingand cooling applications),‘‘(ii) which produces—‘‘(I) at least 20 percent of itstotal useful energy in the form ofthermal energy which is not used toproduce electrical or mechanical power(or combination thereof), and‘‘(II) at least 20 percent of itstotal useful energy in the form of electrical or mechanical power (or combination thereof),‘‘(iii) the energy efficiency percentageof which exceeds 60 percent, and‘‘(iv) which is placed in service beforeJanuary 1, 2017.‘‘(B) LIMITATION.—S.L.C.‘‘(i) IN GENERAL.—In the case ofcombined heat and power system propertywith an electrical capacity in excess of theapplicable capacity placed in service duringthe taxable year, the credit under subsection (a)(1) (determined without regardto this paragraph) for such year shall beequal to the amount which bears the sameratio to such credit as the applicable capacity bears to the capacity of such property.‘‘(ii) APPLICABLE CAPACITY.—Forpurposes of clause (i), the term ‘applicablecapacity’ means 15 megawatts or a mechanical energy capacity of more than20,000 horsepower or an equivalent combination of electrical and mechanical energy capacities.‘‘(iii) MAXIMUM CAPACITY.—The term‘combined heat and power system property’shall not include any property comprising asystem if such system has a capacity in excess of 50 megawatts or a mechanical energy capacity in excess of 67,000 horseO:\AYO\AYO08C32.xml S.L.C.power or an equivalent combination of electrical and mechanical energy capacities.‘‘(C) SPECIAL RULES.—‘‘(i) ENERGY EFFICIENCY PERCENTAGE.—For purposes of this paragraph, theenergy efficiency percentage of a system isthe fraction—‘‘(I) the numerator of which isthe total useful electrical, thermal,and mechanical power produced bythe system at normal operating rates,and expected to be consumed in itsnormal application, and‘‘(II) the denominator of which isthe lower heating value of the fuelsources for the system.‘‘(ii) DETERMINATIONS MADE ON BTUBASIS.—The energy efficiency percentageand the percentages under subparagraph(A)(ii) shall be determined on a Btu basis.‘‘(iii) INPUT AND OUTPUT PROPERTYNOT INCLUDED.—The term ‘combined heatand power system property’ does not include property used to transport the enO:\AYO\AYO08C32.xml S.L.C.ergy source to the facility or to distributeenergy produced by the facility.‘‘(D) SYSTEMS USING BIOMASS.—If a system is designed to use biomass (within themeaning of paragraphs (2) and (3) of section45(c) without regard to the last sentence ofparagraph (3)(A)) for at least 90 percent of theenergy source—‘‘(i) subparagraph (A)(iii) shall notapply, but‘‘(ii) the amount of credit determinedunder subsection (a) with respect to suchsystem shall not exceed the amount whichbears the same ratio to such amount ofcredit (determined without regard to thissubparagraph) as the energy efficiency percentage of such system bears to 60 percent.’’.(3) CONFORMING AMENDMENT.—Section48(a)(1) is amended by striking ‘‘paragraphs (1)(B)and (2)(B)’’ and inserting ‘‘paragraphs (1)(B),(2)(B), and (3)(B)’’.(d) INCREASE CREDIT LIMITATION FUELOF FORCELL PROPERTY.—Subparagraph (B) of section 48(c)(1)is amended by striking ‘‘$500’’ and inserting ‘‘$1,500’’.S.L.C.(e) PUBLIC UTILITY PROPERTY TAKEN INTO ACCOUNT.—(1) IN GENERAL.—Paragraph (3) of section48(a) is amended by striking the second sentencethereof.(2) CONFORMING AMENDMENTS.—(A) Paragraph (1) of section 48(c) isamended by striking subparagraph (D) and redesignating subparagraph (E) as subparagraph(D).(B) Paragraph (2) of section 48(c) isamended by striking subparagraph (D) and redesignating subparagraph (E) as subparagraph(D).(f) EFFECTIVE DATE.—(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments made bythis section shall take effect on the date of the enactment of this Act.(2) ALLOWANCE AGAINST ALTERNATIVE MINIMUM TAX.—The amendments made by subsection(b) shall apply to credits determined under section46 of the Internal Revenue Code of 1986 in taxableyears beginning after the date of the enactment ofthis Act and to carrybacks of such credits.S.L.C.(3) COMBINED HEAT AND POWER AND FUELCELL PROPERTY.—The amendments made by subsections (c) and (d) shall apply to periods after thedate of the enactment of this Act, in taxable yearsending after such date, under rules similar to therules of section 48(m) of the Internal Revenue Codeof 1986 (as in effect on the day before the date ofthe enactment of the Revenue Reconciliation Act of1990).(4) PUBLIC UTILITY PROPERTY.—The amendments made by subsection (e) shall apply to periodsafter February 13, 2008, in taxable years endingafter such date, under rules similar to the rules ofsection 48(m) of the Internal Revenue Code of 1986(as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990).SEC. 104. ENERGY CREDIT FOR SMALL WIND PROPERTY.(a) IN GENERAL.—Section 48(a)(3)(A), as amendedby section 103, is amended by striking ‘‘or’’ at the endof clause (iv), by adding ‘‘or’’ at the end of clause (v),and by inserting after clause (v) the following new clause:‘‘(vi) qualified small wind energyproperty,’’.(b) 30 PERCENT CREDIT.—Section 48(a)(2)(A)(i) isamended by striking ‘‘and’’ at the end of subclause (II)S.L.C.and by inserting after subclause (III) the following newsubclause:‘‘(IV) qualified small wind energyproperty, and’’.(c) QUALIFIED SMALL WIND ENERGY PROPERTY.—Section 48(c), as amended by section 103, is amended byadding at the end the following new paragraph:‘‘(4) QUALIFIED SMALL WIND ENERGY PROPERTY.—‘‘(A) IN GENERAL.—The term ‘qualifiedsmall wind energy property’ means propertywhich uses a qualifying small wind turbine togenerate electricity.‘‘(B) LIMITATION.—In the case of qualified small wind energy property placed in service during the taxable year, the credit otherwisedetermined under subsection (a)(1) for suchyear with respect to all such property of thetaxpayer shall not exceed $4,000.‘‘(C) QUALIFYING TUR SMALL WINDBINE.—The term ‘qualifying small wind turbine’ means a wind turbine which has a nameplate capacity of not more than 100 kilowatts.‘‘(D) TERMINATION.—The term ‘qualifiedsmall wind energy property’ shall not includeS.L.C.any property for any period after December 31,2016.’’.(d) CONFORMING AMENDMENT.—Section 48(a)(1),as amended by section 103, is amended by striking ‘‘paragraphs (1)(B), (2)(B), and (3)(B)’’ and inserting ‘‘paragraphs (1)(B), (2)(B), (3)(B), and (4)(B)’’.(e) EFFECTIVE DATE.—The amendments made bythis section shall apply to periods after the date of theenactment of this Act, in taxable years ending after suchdate, under rules similar to the rules of section 48(m) ofthe Internal Revenue Code of 1986 (as in effect on theday before the date of the enactment of the Revenue Reconciliation Act of 1990).SEC. 105. ENERGY CREDIT FOR GEOTHERMAL HEAT PUMPSYSTEMS.(a) IN GENERAL.—Subparagraph (A) of section48(a)(3), as amended by this Act, is amended by striking‘‘or’’ at the end of clause (v), by inserting ‘‘or’’ at theend of clause (vi), and by adding at the end the followingnew clause:‘‘(vii) equipment which uses theground or ground water as a thermal energy source to heat a structure or as athermal energy sink to cool a structure,S.L.C.but only with respect to periods ending before January 1, 2017,’’.(b) EFFECTIVE DATE.—The amendments made bythis section shall apply to periods after the date of theenactment of this Act, in taxable years ending after suchdate, under rules similar to the rules of section 48(m) ofthe Internal Revenue Code of 1986 (as in effect on theday before the date of the enactment of the Revenue Reconciliation Act of 1990).SEC. 106. CREDIT FOR RESIDENTIAL ENERGY EFFICIENTPROPERTY.(a) EXTENSION.—Section 25D(g) is amended bystriking ‘‘December 31, 2008’’ and inserting ‘‘December31, 2016’’.(b) REMOVAL LIMITATION SOLAR ELECTRICOF FORPROPERTY.—(1) IN GENERAL.—Section 25D(b)(1), asamended by subsections (c) and (d), is amended—(A) by striking subparagraph (A), and(B) by redesignating subparagraphs (B)through (E) as subparagraphs (A) through and(D), respectively.(2) CONFORMING AMENDMENT.—Section25D(e)(4)(A), as amended by subsections (c) and(d), is amended—S.L.C.(A) by striking clause (i), and(B) by redesignating clauses (ii) through(v) as clauses (i) and (iv), respectively.(c) CREDIT RESIDENTIAL WIND PROPERTY.—FOR(1) IN GENERAL.—Section 25D(a) is amendedby striking ‘‘and’’ at the end of paragraph (2), bystriking the period at the end of paragraph (3) andinserting ‘‘, and’’, and by adding at the end the following new paragraph:‘‘(4) 30 percent of the qualified small wind energy property expenditures made by the taxpayerduring such year.’’.(2) LIMITATION.—Section 25D(b)(1) is amended by striking ‘‘and’’ at the end of subparagraph(B), by striking the period at the end of subparagraph (C) and inserting ‘‘, and’’, and by adding atthe end the following new subparagraph:‘‘(D) $500 with respect to each half kilowatt of capacity (not to exceed $4,000) of windturbines for which qualified small wind energyproperty expenditures are made.’’.(3) QUALIFIED SMALL WIND ENERGY PROPERTY EXPENDITURES.—S.L.C.(A) IN GENERAL.—Section 25D(d) isamended by adding at the end the followingnew paragraph:‘‘(4) QUALIFIED SMALL WIND ENERGY PROPEXPENDITURE.—The term ‘qualified smallERTYwind energy property expenditure’ means an expenditure for property which uses a wind turbine to generate electricity for use in connection with a dwellingunit located in the United States and used as a residence by the taxpayer.’’.(B) NO BENEFIT.—SectionDOUBLE45(d)(1) is amended by adding at the end thefollowing new sentence: ‘‘Such term shall notinclude any facility with respect to which anyqualified small wind energy property expenditure (as defined in subsection (d)(4) of section25D) is taken into account in determining thecredit under such section.’’.(4) MAXIMUM EXPENDITURES IN CASE OFOCCUPANCY.—Section 25D(e)(4)(A) isJOINTamended by striking ‘‘and’’ at the end of clause (ii),by striking the period at the end of clause (iii) andinserting ‘‘, and’’, and by adding at the end the following new clause:S.L.C.‘‘(iv) $1,667 in the case of each halfkilowatt of capacity (not to exceed$13,333) of wind turbines for which qualified small wind energy property expenditures are made.’’.(d) CREDIT GEOTHERMAL HEAT SYS FOR PUMPTEMS.—(1) IN GENERAL.—Section 25D(a), as amendedby subsection (c), is amended by striking ‘‘and’’ atthe end of paragraph (3), by striking the period atthe end of paragraph (4) and inserting ‘‘, and’’, andby adding at the end the following new paragraph:‘‘(5) 30 percent of the qualified geothermalheat pump property expenditures made by the taxpayer during such year.’’.(2) LIMITATION.—Section 25D(b)(1), asamended by subsection (c), is amended by striking‘‘and’’ at the end of subparagraph (C), by strikingthe period at the end of subparagraph (D) and inserting ‘‘, and’’, and by adding at the end the following new subparagraph:‘‘(E) $2,000 with respect to any qualifiedgeothermal heat pump property expenditures.’’.(3) QUALIFIED GEOTHERMAL HEAT PUMPEXPENDITURE.—Section 25D(d), asPROPERTYS.L.C.amended by subsection (c), is amended by adding atthe end the following new paragraph:‘‘(5) QUALIFIED GEOTHERMAL HEAT PUMPPROPERTY EXPENDITURE.—‘‘(A) IN GENERAL.—The term ‘qualifiedgeothermal heat pump property expenditure’means an expenditure for qualified geothermalheat pump property installed on or in connection with a dwelling unit located in the UnitedStates and used as a residence by the taxpayer.‘‘(B) QUALIFIED GEOTHERMAL HEATPROPERTY.—The term ‘qualified geo PUMPthermal heat pump property’ means any equipment which—‘‘(i) uses the ground or ground wateras a thermal energy source to heat thedwelling unit referred to in subparagraph(A) or as a thermal energy sink to coolsuch dwelling unit, and‘‘(ii) meets the requirements of theEnergy Star program which are in effectat the time that the expenditure for suchequipment is made.’’.(4) MAXIMUM EXPENDITURES IN CASE OFOCCUPANCY.—Section 25D(e)(4)(A), asJOINTS.L.C.amended by subsection (c), is amended by striking‘‘and’’ at the end of clause (iii), by striking the period at the end of clause (iv) and inserting ‘‘, and’’,and by adding at the end the following new clause:‘‘(v) $6,667 in the case of any qualified geothermal heat pump property expenditures.’’.(e) CREDIT ALLOWED AGAINST ALTERNATIVE MINTAX.—IMUM(1) IN GENERAL.—Subsection (c) of section25D is amended to read as follows:‘‘(c) LIMITATION BASED AMOUNT TAX;ON OFCARRYFORWARD OF UNUSED CREDIT.—‘‘(1) LIMITATION BASED ON AMOUNT OFTAX.—In the case of a taxable year to which section26(a)(2) does not apply, the credit allowed undersubsection (a) for the taxable year shall not exceedthe excess of—‘‘(A) the sum of the regular tax liability(as defined in section 26(b)) plus the tax imposed by section 55, over‘‘(B) the sum of the credits allowableunder this subpart (other than this section) andsection 27 for the taxable year.‘‘(2) CARRYFORWARD OF UNUSED CREDIT.—S.L.C.‘‘(A) RULE FOR YEARS IN WHICH ALLPERSONAL CREDITS ALLOWED AGAINST REGULAR AND ALTERNATIVE MINIMUM TAX.—Inthe case of a taxable year to which section26(a)(2) applies, if the credit allowable undersubsection (a) exceeds the limitation imposed bysection 26(a)(2) for such taxable year reducedby the sum of the credits allowable under thissubpart (other than this section), such excessshall be carried to the succeeding taxable yearand added to the credit allowable under subsection (a) for such succeeding taxable year.‘‘(B) RULE FOR OTHER YEARS.—In thecase of a taxable year to which section 26(a)(2)does not apply, if the credit allowable undersubsection (a) exceeds the limitation imposed byparagraph (1) for such taxable year, such excess shall be carried to the succeeding taxableyear and added to the credit allowable undersubsection (a) for such succeeding taxableyear.’’.(2) CONFORMING AMENDMENTS.—(A) Section 23(b)(4)(B) is amended by inserting ‘‘and section 25D’’ after ‘‘this section’’.S.L.C.(B) Section 24(b)(3)(B) is amended bystriking ‘‘and 25B’’ and inserting ‘‘, 25B, and25D’’.(C) Section 25B(g)(2) is amended by striking ‘‘section 23’’ and inserting ‘‘sections 23 and25D’’.(D) Section 26(a)(1) is amended by striking ‘‘and 25B’’ and inserting ‘‘25B, and 25D’’.(f) EFFECTIVE DATE.—(1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this sectionshall apply to taxable years beginning after December 31, 2007.(2) SOLAR ELECTRIC PROPERTY LIMITATION.—The amendments made by subsection (b) shall applyto taxable years beginning after December 31, 2008.(3) APPLICATION OF EGTRRA SUNSET.—Theamendments made by subparagraphs (A) and (B) ofsubsection (e)(2) shall be subject to title IX of theEconomic Growth and Tax Relief Reconciliation Actof 2001 in the same manner as the provisions ofsuch Act to which such amendments relate.S.L.C.SEC. 107. NEW CLEAN RENEWABLE ENERGY BONDS.(a) IN GENERAL.—Subpart I of part IV of subchapter A of chapter 1 is amended by adding at the endthe following new section:‘‘SEC. 54C. NEW CLEAN RENEWABLE ENERGY BONDS.‘‘(a) NEW CLEAN RENEWABLE ENERGY BOND.—Forpurposes of this subpart, the term ‘new clean renewableenergy bond’ means any bond issued as part of an issueif—‘‘(1) 100 percent of the available project proceeds of such issue are to be used for capital expenditures incurred by governmental bodies, public powerproviders, or cooperative electric companies for oneor more qualified renewable energy facilities,‘‘(2) the bond is issued by a qualified issuer,and‘‘(3) the issuer designates such bond for purposes of this section.‘‘(b) REDUCED CREDIT AMOUNT.—The annual creditdetermined under section 54A(b) with respect to any newclean renewable energy bond shall be 70 percent of theamount so determined without regard to this subsection.‘‘(c) LIMITATION AMOUNT BONDS DES ON OFIGNATED.—‘‘(1) IN GENERAL.—The maximum aggregateface amount of bonds which may be designatedS.L.C.under subsection (a) by any issuer shall not exceedthe limitation amount allocated under this subsection to such issuer.‘‘(2) NATIONAL LIMITATION ON AMOUNT OFBONDS DESIGNATED.—There is a national new cleanrenewable energy bond limitation of $800,000,000which shall be allocated by the Secretary as providedin paragraph (3), except that—‘‘(A) not more than 331⁄3 percent thereofmay be allocated to qualified projects of publicpower providers,‘‘(B) not more than 331⁄3 percent thereofmay be allocated to qualified projects of governmental bodies, and‘‘(C) not more than 331⁄3 percent thereofmay be allocated to qualified projects of cooperative electric companies.‘‘(3) METHOD OF ALLOCATION.—‘‘(A) ALLOCATION AMONG PUBLIC POWERPROVIDERS.—After the Secretary determinesthe qualified projects of public power providerswhich are appropriate for receiving an allocation of the national new clean renewable energybond limitation, the Secretary shall, to the maximum extent practicable, make allocationsS.L.C.among such projects in such manner that theamount allocated to each such project bears thesame ratio to the cost of such project as thelimitation under paragraph (2)(A) bears to thecost of all such projects.‘‘(B) ALLOCATION AMONG GOVERNMENTALBODIES AND COOPERATIVE ELECTRIC COMPANIES.—The Secretary shall make allocations ofthe amount of the national new clean renewableenergy bond limitation described in paragraphs(2)(B) and (2)(C) among qualified projects ofgovernmental bodies and cooperative electriccompanies, respectively, in such manner as theSecretary determines appropriate.‘‘(d) DEFINITIONS.—For purposes of this section—‘‘(1) QUALIFIED RENEWABLE ENERGY FACILITY.—The term ‘qualified renewable energy facility’means a qualified facility (as determined under section 45(d) without regard to paragraphs (8) and(10) thereof and to any placed in service date)owned by a public power provider, a governmentalbody, or a cooperative electric company.‘‘(2) PUBLIC PROVIDER.—The termPOWER‘public power provider’ means a State utility with aservice obligation, as such terms are defined in secO:\AYO\AYO08C32.xml S.L.C.tion 217 of the Federal Power Act (as in effect onthe date of the enactment of this paragraph).‘‘(3) GOVERNMENTAL BODY.—The term ‘governmental body’ means any State or Indian tribalgovernment, or any political subdivision thereof.‘‘(4) COOPERATIVE ELECTRIC COMPANY.—Theterm ‘cooperative electric company’ means a mutualor cooperative electric company described in section501(c)(12) or section 1381(a)(2)(C).‘‘(5) CLEAN RENEWABLE ENERGY BOND LENDER.—The term ‘clean renewable energy bond lender’means a lender which is a cooperative which isowned by, or has outstanding loans to, 100 or morecooperative electric companies and is in existence onFebruary 1, 2002, and shall include any affiliatedentity which is controlled by such lender.‘‘(6) QUALIFIED ISSUER.—The term ‘qualifiedissuer’ means a public power provider, a cooperativeelectric company, a governmental body, a clean renewable energy bond lender, or a not-for-profit electric utility which has received a loan or loan guarantee under the Rural Electrification Act.’’.(b) CONFORMING AMENDMENTS.—(1) Paragraph (1) of section 54A(d) is amendedto read as follows:S.L.C.‘‘(1) QUALIFIED TAX CREDIT BOND.—The term‘qualified tax credit bond’ means—‘‘(A) a qualified forestry conservationbond, or‘‘(B) a new clean renewable energy bond,which is part of an issue that meets requirements ofparagraphs (2), (3), (4), (5), and (6).’’.(2) Subparagraph (C) of section 54A(d)(2) isamended to read as follows:‘‘(C) QUALIFIED PURPOSE.—For purposesof this paragraph, the term ‘qualified purpose’means—‘‘(i) in the case of a qualified forestryconservation bond, a purpose specified insection 54B(e), and‘‘(ii) in the case of a new clean renewable energy bond, a purpose specified insection 54C(a)(1).’’.(3) The table of sections for subpart I of partIV of subchapter A of chapter 1 is amended by adding at the end the following new item:‘‘Sec. 54C. Qualified clean renewable energy bonds.’’.(c) EXTENSION CLEAN RENEWABLE ENERGYFORBONDS.—Subsection (m) of section 54 is amended bystriking ‘‘December 31, 2008’’ and inserting ‘‘December31, 2009’’.S.L.C.(d) EFFECTIVE DATE.—The amendments made bythis section shall apply to obligations issued after the dateof the enactment of this Act.SEC. 108. CREDIT FOR STEEL INDUSTRY FUEL.(a) TREATMENT AS REFINED COAL.—(1) IN GENERAL.—Subparagraph (A) of section45(c)(7) of the Internal Revenue Code of 1986 (relating to refined coal), as amended by this Act, isamended to read as follows:‘‘(A) IN GENERAL.—The term ‘refinedcoal’ means a fuel—‘‘(i) which—‘‘(I) is a liquid, gaseous, or solidfuel produced from coal (including lignite) or high carbon fly ash, includingsuch fuel used as a feedstock,‘‘(II) is sold by the taxpayer withthe reasonable expectation that it willbe used for purpose of producingsteam,‘‘(III) is certified by the taxpayeras resulting (when used in the production of steam) in a qualified emissionreduction, andS.L.C.‘‘(IV) is produced in such a manner as to result in an increase of atleast 50 percent in the market valueof the refined coal (excluding any increase caused by materials combinedor added during the production process), as compared to the value of thefeedstock coal, or‘‘(ii) which is steel industry fuel.’’.(2) STEEL INDUSTRY FUEL DEFINED.—Paragraph (7) of section 45(c) of such Code is amendedby adding at the end the following new subparagraph:‘‘(C) STEEL INDUSTRY FUEL.—‘‘(i) IN GENERAL.—The term ‘steel industry fuel’ means a fuel which—‘‘(I) is produced through a process of liquifying coal waste sludge anddistributing it on coal, and‘‘(II) is used as a feedstock forthe manufacture of coke.‘‘(ii) COAL SLUDGE.—TheWASTEterm ‘coal waste sludge’ means the tar decanter sludge and related byproducts ofthe coking process, including such mateO:\AYO\AYO08C32.xml S.L.C.rials that have been stored in ground, intanks and in lagoons, that have been treated as hazardous wastes under applicableFederal environmental rules absent liquefaction and processing with coal into afeedstock for the manufacture of coke.’’.(b) CREDIT AMOUNT.—(1) IN GENERAL.—Paragraph (8) of section45(e) of the Internal Revenue Code of 1986 (relating to refined coal production facilities) is amendedby adding at the end the following new subparagraph‘‘(D) SPECIAL RULE FOR STEEL INDUSTRYFUEL.—‘‘(i) IN GENERAL.—In the case of ataxpayer who produces steel industryfuel—‘‘(I) this paragraph shall be applied separately with respect to steelindustry fuel and other refined coal,and‘‘(II) in applying this paragraphto steel industry fuel, the modifications in clause (ii) shall apply.‘‘(ii) MODIFICATIONS.—S.L.C.‘‘(I) CREDIT AMOUNT.—Subparagraph (A) shall be applied by substituting ‘$2 per barrel-of-oil equivalent’ for ‘$4.375 per ton’.‘‘(II) CREDIT PERIOD.—In lieuof the 10-year period referred to inclauses (i) and (ii)(II) of subparagraph (A), the credit period shall bethe period beginning on the later ofthe date such facility was originallyplaced in service, the date the modifications described in clause (iii) wereplaced in service, or October 1, 2008,and ending on the later of December31, 2009, or the date which is 1 yearafter the date such facility or themodifications described in clause (iii)were placed in service.‘‘(III) NO PHASEOUT.—Subparagraph (B) shall not apply.‘‘(iii) MODIFICATIONS.—The modifications described in this clause are modifications to an existing facility which allowsuch facility to produce steel industry fuel.S.L.C.‘‘(iv) BARREL-OF-OIL EQUIVALENT.—For purposes of this subparagraph, a barrel-of-oil equivalent is the amount of steelindustry fuel that has a Btu content of5,800,000 Btus.’’.(2) INFLATION ADJUSTMENT.—Paragraph (2)of section 45(b) of such Code is amended by inserting ‘‘the $3 amount in subsection (e)(8)(D)(ii)(I),’’after ‘‘subsection (e)(8)(A),’’.(c) TERMINATION.—Paragraph (8) of section 45(d)of the Internal Revenue Code of 1986 (relating to refinedcoal production facility), as amended by this Act, isamended to read as follows:‘‘(8) REFINED COAL PRODUCTION FACILITY.—In the case of a facility that produces refined coal,the term ‘refined coal production facility’ means—‘‘(A) with respect to a facility producingsteel industry fuel, any facility (or any modification to a facility) which is placed in servicebefore January 1, 2010, and‘‘(B) with respect to any other facility producing refined coal, any facility placed in service after the date of the enactment of the American Jobs Creation Act of 2004 and before January 1, 2010.’’.S.L.C.(d) COORDINATION WITH CREDIT PRODUCINGFORFUEL FROM A NONCONVENTIONAL SOURCE.—(1) IN GENERAL.—Subparagraph (B) of section45(e)(9) of the Internal Revenue Code of 1986 isamended—(A) by striking ‘‘The term’’ and insertingthe following:‘‘(i) IN GENERAL.—The term’’, and(B) by adding at the end the following newclause:‘‘(ii) EXCEPTION FOR STEEL INDUSTRY COAL.—In the case of a facility producing steel industry fuel, clause (i) shallnot apply to so much of the refined coalproduced at such facility as is steel industry fuel.’’.(2) NO DOUBLE BENEFIT.—Section 45K(g)(2)of such Code is amended by adding at the end thefollowing new subparagraph:‘‘(E) COORDINATION WITH SECTION 45.—No credit shall be allowed with respect to anyqualified fuel which is steel industry fuel (as defined in section 45(c)(7)) if a credit is allowedto the taxpayer for such fuel under section45.’’.S.L.C.(e) EFFECTIVE DATE.—The amendments made bythis section shall apply to fuel produced and sold afterSeptember 30, 2008.SEC. 109. SPECIAL RULE TO IMPLEMENT FERC AND STATEELECTRIC RESTRUCTURING POLICY.(a) EXTENSION QUALIFIED ELECTRIC UTILI FORTIES.—(1) IN GENERAL.—Paragraph (3) of section451(i) is amended by inserting ‘‘(before January 1,2010, in the case of a qualified electric utility)’’after ‘‘January 1, 2008’’.(2) QUALIFIED ELECTRIC UTILITY.—Subsection(i) of section 451 is amended by redesignating paragraphs (6) through (10) as paragraphs (7) through(11), respectively, and by inserting after paragraph(5) the following new paragraph:‘‘(6) QUALIFIED ELECTRIC UTILITY.—For purposes of this subsection, the term ‘qualified electricutility’ means a person that, as of the date of thequalifying electric transmission transaction, isvertically integrated, in that it is both—‘‘(A) a transmitting utility (as defined insection 3(23) of the Federal Power Act (16U.S.C. 796(23))) with respect to the transO:\AYO\AYO08C32.xml S.L.C.mission facilities to which the election underthis subsection applies, and‘‘(B) an electric utility (as defined in section 3(22) of the Federal Power Act (16 U.S.C.796(22))).’’.(b) EXTENSION PERIOD TRANSFEROF FOR OFOPERATIONAL CONTROL AUTHORIZED FERC.—BYClause (ii) of section 451(i)(4)(B) is amended by striking‘‘December 31, 2007’’ and inserting ‘‘the date which is4 years after the close of the taxable year in which thetransaction occurs’’.(c) PROPERTY LOCATED OUTSIDE UNITEDTHESTATES NOT TREATED EXEMPT UTILITY PROP ASERTY.—Paragraph (5) of section 451(i) is amended byadding at the end the following new subparagraph:‘‘(C) EXCEPTION FOR PROPERTY LOCATEDOUTSIDE THE UNITED STATES.—The term ‘exempt utility property’ shall not include anyproperty which is located outside the UnitedStates.’’.(d) EFFECTIVE DATES.—(1) EXTENSION.—The amendments made bysubsection (a) shall apply to transactions after December 31, 2007.S.L.C.(2) TRANSFERS OF OPERATIONAL CONTROL.—The amendment made by subsection (b) shall takeeffect as if included in section 909 of the AmericanJobs Creation Act of 2004.(3) EXCEPTION FOR PROPERTY LOCATED OUTSIDE THE UNITED STATES.—The amendment madeby subsection (c) shall apply to transactions afterthe date of the enactment of this Act.Subtitle B—Carbon Mitigation andCoal ProvisionsSEC. 111. EXPANSION AND MODIFICATION OF ADVANCEDCOAL PROJECT INVESTMENT CREDIT.(a) MODIFICATION CREDIT AMOUNT.—SectionOF48A(a) is amended by striking ‘‘and’’ at the end of paragraph (1), by striking the period at the end of paragraph(2) and inserting ‘‘, and’’, and by adding at the end thefollowing new paragraph:‘‘(3) 30 percent of the qualified investment forsuch taxable year in the case of projects describedin clause (iii) of subsection (d)(3)(B).’’.(b) EXPANSION AGGREGATE CREDITS.—SectionOF48A(d)(3)(A) is amended by striking ‘‘$1,300,000,000’’and inserting ‘‘$2,550,000,000’’.(c) AUTHORIZATION OF ADDITIONAL PROJECTS.—S.L.C.(1) IN GENERAL.—Subparagraph (B) of section48A(d)(3) is amended to read as follows:‘‘(B) PARTICULAR PROJECTS.—Of the dollar amount in subparagraph (A), the Secretaryis authorized to certify—‘‘(i) $800,000,000 for integrated gasification combined cycle projects the application for which is submitted during theperiod described in paragraph (2)(A)(i),‘‘(ii) $500,000,000 for projects whichuse other advanced coal-based generationtechnologies the application for which issubmitted during the period described inparagraph (2)(A)(i), and‘‘(iii) $1,250,000,000 for advancedcoal-based generation technology projectsthe application for which is submitted during the period described in paragraph(2)(A)(ii).’’.(2) APPLICATION PERIOD FOR ADDITIONALPROJECTS.—Subparagraph (A) of section 48A(d)(2)is amended to read as follows:‘‘(A) APPLICATION PERIOD.—Each applicant for certification under this paragraph shallsubmit an application meeting the requirementsS.L.C.of subparagraph (B). An applicant may onlysubmit an application—‘‘(i) for an allocation from the dollaramount specified in clause (i) or (ii) ofparagraph (3)(B) during the 3-year periodbeginning on the date the Secretary establishes the program under paragraph (1),and‘‘(ii) for an allocation from the dollaramount specified in paragraph (3)(B)(iii)during the 3-year period beginning at theearlier of the termination of the period described in clause (i) or the date prescribedby the Secretary.’’.(3) CAPTURE AND SEQUESTRATION OF CARBONDIOXIDE EMISSIONS REQUIREMENT.—(A) IN GENERAL.—Section 48A(e)(1) isamended by striking ‘‘and’’ at the end of subparagraph (E), by striking the period at theend of subparagraph (F) and inserting ‘‘; and’’,and by adding at the end the following new subparagraph:‘‘(G) in the case of any project the application for which is submitted during the perioddescribed in subsection (d)(2)(A)(ii), the projectS.L.C.includes equipment which separates and sequesters at least 65 percent (70 percent in the caseof an application for reallocated credits undersubsection (d)(4)) of such project’s total carbondioxide emissions.’’.(B) HIGHEST PRIORITY FOR PROJECTSEMIS WHICH SEQUESTER CARBON DIOXIDESIONS.—Section 48A(e)(3) is amended by striking ‘‘and’’ at the end of subparagraph (A)(iii),by striking the period at the end of subparagraph (B)(iii) and inserting ‘‘, and’’, and byadding at the end the following new subparagraph:‘‘(C) give highest priority to projects withthe greatest separation and sequestration percentage of total carbon dioxide emissions.’’.(C) RECAPTURE OF CREDIT FOR FAILURETO SEQUESTER.—Section 48A is amended byadding at the end the following new subsection:‘‘(i) RECAPTURE CREDIT FAILURE TO SE OF FORQUESTER.—The Secretary shall provide for recapturingthe benefit of any credit allowable under subsection (a)with respect to any project which fails to attain or maintain the separation and sequestration requirements of subsection (e)(1)(G).’’.S.L.C.(4) ADDITIONAL PRIORITY FOR RESEARCHPARTNERSHIPS.—Section 48A(e)(3)(B), as amendedby paragraph (3)(B), is amended—(A) by striking ‘‘and’’ at the end of clause(ii),(B) by redesignating clause (iii) as clause(iv), and(C) by inserting after clause (ii) the following new clause:‘‘(iii) applicant participants who havea research partnership with an eligible educational institution (as defined in section529(e)(5)), and’’.(5) CLERICAL AMENDMENT.—Section 48A(e)(3)is amended by striking ‘‘INTEGRATED GASIFICATIONCOMBINED CYCLE’’ in the heading and inserting‘‘CERTAIN’’.(d) DISCLOSURE ALLOCATIONS.—Section 48A(d)OFis amended by adding at the end the following new paragraph:‘‘(5) DISCLOSURE OF ALLOCATIONS.—The Secretary shall, upon making a certification under thissubsection or section 48B(d), publicly disclose theidentity of the applicant and the amount of the credit certified with respect to such applicant.’’.S.L.C.(e) EFFECTIVE DATES.—(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments made bythis section shall apply to credits the application forwhich is submitted during the period described insection 48A(d)(2)(A)(ii) of the Internal RevenueCode of 1986 and which are allocated or reallocatedafter the date of the enactment of this Act.(2) DISCLOSURE ALLOCATIONS.—TheOFamendment made by subsection (d) shall apply tocertifications made after the date of the enactmentof this Act.(3) CLERICAL AMENDMENT.—The amendmentmade by subsection (c)(5) shall take effect as if included in the amendment made by section 1307(b)of the Energy Tax Incentives Act of 2005.SEC. 112. EXPANSION AND MODIFICATION OF COAL GASIFICATION INVESTMENT CREDIT.(a) MODIFICATION CREDIT AMOUNT.—SectionOF48B(a) is amended by inserting ‘‘(30 percent in the caseof credits allocated under subsection (d)(1)(B))’’ after ‘‘20percent’’.(b) EXPANSION AGGREGATE CREDITS.—SectionOF48B(d)(1) is amended by striking ‘‘shall not exceedS.L.C.$350,000,000’’ and all that follows and inserting ‘‘shallnot exceed—‘‘(A) $350,000,000, plus‘‘(B) $250,000,000 for qualifying gasification projects that include equipment whichseparates and sequesters at least 75 percent ofsuch project’s total carbon dioxide emissions.’’.(c) RECAPTURE CREDIT FAILURE SE OF FOR TOQUESTER.—Section 48B is amended by adding at the endthe following new subsection:‘‘(f) RECAPTURE CREDIT FAILURE SE OF FOR TOQUESTER.—The Secretary shall provide for recapturingthe benefit of any credit allowable under subsection (a)with respect to any project which fails to attain or maintain the separation and sequestration requirements forsuch project under subsection (d)(1).’’.(d) SELECTION PRIORITIES.—Section 48B(d) isamended by adding at the end the following new paragraph:‘‘(4) SELECTION PRIORITIES.—In determiningwhich qualifying gasification projects to certifyunder this section, the Secretary shall—‘‘(A) give highest priority to projects withthe greatest separation and sequestration percentage of total carbon dioxide emissions, andS.L.C.‘‘(B) give high priority to applicant participants who have a research partnership with aneligible educational institution (as defined insection 529(e)(5)).’’.(e) ELIGIBLE PROJECTS INCLUDE TRANSPORTATIONGRADE LIQUID FUELS.—Section 48B(c)(7) (defining eligible entity) is amended by striking ‘‘and’’ at the end ofsubparagraph (F), by striking the period at the end ofsubparagraph (G) and inserting ‘‘, and’’, and by addingat the end the following new subparagraph:‘‘(H) transportation grade liquid fuels.’’.(f) EFFECTIVE DATE.—The amendments made bythis section shall apply to credits described in section48B(d)(1)(B) of the Internal Revenue Code of 1986 whichare allocated or reallocated after the date of the enactmentof this Act.SEC. 113. TEMPORARY INCREASE IN COAL EXCISE TAX;FUNDING OF BLACK LUNG DISABILITY TRUSTFUND.(a) EXTENSION TEMPORARY INCREASE.—Para OFgraph (2) of section 4121(e) is amended—(1) by striking ‘‘January 1, 2014’’ in subparagraph (A) and inserting ‘‘December 31, 2018’’, andS.L.C.(2) by striking ‘‘January 1 after 1981’’ in subparagraph (B) and inserting ‘‘December 31 after2007’’.(b) RESTRUCTURING OF TRUST FUND DEBT.—(1) DEFINITIONS.—For purposes of this subsection—(A) MARKET VALUE OF THE OUTSTANDINGREPAYABLE ADVANCES, PLUS ACCRUED INTEREST.—The term ‘‘market value of the outstanding repayable advances, plus accrued interest’’ means the present value (determined bythe Secretary of the Treasury as of the refinancing date and using the Treasury rate asthe discount rate) of the stream of principaland interest payments derived assuming thateach repayable advance that is outstanding onthe refinancing date is due on the 30th anniversary of the end of the fiscal year in which theadvance was made to the Trust Fund, and thatall such principal and interest payments aremade on September 30 of the applicable fiscalyear.(B) REFINANCING DATE.—The term ‘‘refinancing date’’ means the date occurring 2 daysafter the enactment of this Act.S.L.C.(C) REPAYABLE ADVANCE.—The term ‘‘repayable advance’’ means an amount that hasbeen appropriated to the Trust Fund in orderto make benefit payments and other expenditures that are authorized under section 9501 ofthe Internal Revenue Code of 1986 and are required to be repaid when the Secretary of theTreasury determines that monies are availablein the Trust Fund for such purpose.(D) TREASURY RATE.—The term ‘‘Treasury rate’’ means a rate determined by the Secretary of the Treasury, taking into consideration current market yields on outstandingmarketable obligations of the United States ofcomparable maturities.(E) TREASURY 1-YEAR RATE.—The term‘‘Treasury 1-year rate’’ means a rate determined by the Secretary of the Treasury, takinginto consideration current market yields on outstanding marketable obligations of the UnitedStates with remaining periods to maturity ofapproximately 1 year, to have been in effect asof the close of business 1 business day prior tothe date on which the Trust Fund issues obligaO:\AYO\AYO08C32.xml S.L.C.tions to the Secretary of the Treasury underparagraph (2)(B).(F) TRUST FUND.—The term ‘‘TrustFund’’ means the Black Lung Disability TrustFund established under section 9501 of the Internal Revenue Code of 1986.(2) REFINANCING OF OUTSTANDING PRINCIPALOF REPAYABLE ADVANCES AND UNPAID INTERESTON SUCH ADVANCES.—(A) TRANSFER TO GENERAL FUND.—Onthe refinancing date, the Trust Fund shallrepay the market value of the outstanding repayable advances, plus accrued interest, bytransferring into the general fund of the Treasury the following sums:(i) The proceeds from obligations thatthe Trust Fund shall issue to the Secretary of the Treasury in such amounts asthe Secretaries of Labor and the Treasuryshall determine and bearing interest at theTreasury rate, and that shall be in suchforms and denominations and be subject tosuch other terms and conditions, includingmaturity, as the Secretary of the Treasuryshall prescribe.S.L.C.(ii) All, or that portion, of the appropriation made to the Trust Fund pursuantto paragraph (3) that is needed to coverthe difference defined in that paragraph.(B) REPAYMENT OF OBLIGATIONS.—In theevent that the Trust Fund is unable to repaythe obligations that it has issued to the Secretary of the Treasury under subparagraph(A)(i) and this subparagraph, or is unable tomake benefit payments and other authorized expenditures, the Trust Fund shall issue obligations to the Secretary of the Treasury in suchamounts as may be necessary to make such repayments, payments, and expenditures, with amaturity of 1 year, and bearing interest at theTreasury 1-year rate. These obligations shall bein such forms and denominations and be subject to such other terms and conditions as theSecretary of the Treasury shall prescribe.(C) AUTHORITY TO ISSUE OBLIGATIONS.—The Trust Fund is authorized to issue obligations to the Secretary of the Treasury undersubparagraphs (A)(i) and (B). The Secretary ofthe Treasury is authorized to purchase such obligations of the Trust Fund. For the purposesS.L.C.of making such purchases, the Secretary of theTreasury may use as a public debt transactionthe proceeds from the sale of any securitiesissued under chapter 31 of title 31, UnitedStates Code, and the purposes for which securities may be issued under such chapter are extended to include any purchase of such TrustFund obligations under this subparagraph.(3) ONE-TIME APPROPRIATION.—There is hereby appropriated to the Trust Fund an amount sufficient to pay to the general fund of the Treasury thedifference between—(A) the market value of the outstandingrepayable advances, plus accrued interest; and(B) the proceeds from the obligationsissued by the Trust Fund to the Secretary ofthe Treasury under paragraph (2)(A)(i).(4) PREPAYMENT OF TRUST FUND OBLIGATIONS.—The Trust Fund is authorized to repay anyobligation issued to the Secretary of the Treasuryunder subparagraphs (A)(i) and (B) of paragraph(2) prior to its maturity date by paying a prepayment price that would, if the obligation being prepaid (including all unpaid interest accrued thereonthrough the date of prepayment) were purchased byS.L.C.a third party and held to the maturity date of suchobligation, produce a yield to the third-party purchaser for the period from the date of purchase tothe maturity date of such obligation substantiallyequal to the Treasury yield on outstanding marketable obligations of the United States having a comparable maturity to this period.SEC. 114. SPECIAL RULES FOR REFUND OF THE COAL EXCISE TAX TO CERTAIN COAL PRODUCERSAND EXPORTERS.(a) REFUND.—(1) COAL PRODUCERS.—(A) IN GENERAL.—Notwithstanding subsections (a)(1) and (c) of section 6416 and section 6511 of the Internal Revenue Code of1986, if—(i) a coal producer establishes thatsuch coal producer, or a party related tosuch coal producer, exported coal producedby such coal producer to a foreign countryor shipped coal produced by such coal producer to a possession of the United States,or caused such coal to be exported orshipped, the export or shipment of whichS.L.C.was other than through an exporter whomeets the requirements of paragraph (2),(ii) such coal producer filed an excisetax return on or after October 1, 1990,and on or before the date of the enactmentof this Act, and(iii) such coal producer files a claimfor refund with the Secretary not laterthan the close of the 30-day period beginning on the date of the enactment of thisAct,then the Secretary shall pay to such coal producer an amount equal to the tax paid undersection 4121 of such Code on such coal exported or shipped by the coal producer or aparty related to such coal producer, or causedby the coal producer or a party related to suchcoal producer to be exported or shipped.(B) SPECIAL RULES FOR CERTAIN TAXPAYERS.—For purposes of this section—(i) IN GENERAL.—If a coal produceror a party related to a coal producer hasreceived a judgment described in clause(iii), such coal producer shall be deemed tohave established the export of coal to a forO:\AYO\AYO08C32.xml S.L.C.eign country or shipment of coal to a possession of the United States under subparagraph (A)(i).(ii) AMOUNT OF PAYMENT.—If a taxpayer described in clause (i) is entitled toa payment under subparagraph (A), theamount of such payment shall be reducedby any amount paid pursuant to the judgment described in clause (iii).(iii) JUDGMENT DESCRIBED.—A judgment is described in this subparagraph ifsuch judgment—(I) is made by a court of competent jurisdiction within the UnitedStates,(II) relates to the constitutionality of any tax paid on exportedcoal under section 4121 of the Internal Revenue Code of 1986, and(III) is in favor of the coal producer or the party related to the coalproducer.(2) EXPORTERS.—Notwithstanding subsections(a)(1) and (c) of section 6416 and section 6511 ofthe Internal Revenue Code of 1986, and a judgmentS.L.C.described in paragraph (1)(B)(iii) of this subsection,if—(A) an exporter establishes that such exporter exported coal to a foreign country orshipped coal to a possession of the UnitedStates, or caused such coal to be so exported orshipped,(B) such exporter filed a tax return on orafter October 1, 1990, and on or before thedate of the enactment of this Act, and(C) such exporter files a claim for refundwith the Secretary not later than the close ofthe 30-day period beginning on the date of theenactment of this Act,then the Secretary shall pay to such exporter anamount equal to $0.825 per ton of such coal exported by the exporter or caused to be exported orshipped, or caused to be exported or shipped, by theexporter.(b) LIMITATIONS.—Subsection (a) shall not applywith respect to exported coal if a settlement with the Federal Government has been made with and accepted by, thecoal producer, a party related to such coal producer, orthe exporter, of such coal, as of the date that the claimis filed under this section with respect to such exportedS.L.C.coal. For purposes of this subsection, the term ‘‘settlementwith the Federal Government’’ shall not include any settlement or stipulation entered into as of the date of the enactment of this Act, the terms of which contemplate ajudgment concerning which any party has reserved theright to file an appeal, or has filed an appeal.(c) SUBSEQUENT REFUND PROHIBITED.—No refundshall be made under this section to the extent that a creditor refund of such tax on such exported or shipped coalhas been paid to any person.(d) DEFINITIONS.—For purposes of this section—(1) COAL PRODUCER.—The term ‘‘coal producer’’ means the person in whom is vested ownership of the coal immediately after the coal is severedfrom the ground, without regard to the existence ofany contractual arrangement for the sale or otherdisposition of the coal or the payment of any royalties between the producer and third parties. Theterm includes any person who extracts coal fromcoal waste refuse piles or from the silt waste productwhich results from the wet washing (or similar processing) of coal.(2) EXPORTER.—The term ‘‘exporter’’ means aperson, other than a coal producer, who does nothave a contract, fee arrangement, or any otherS.L.C.agreement with a producer or seller of such coal toexport or ship such coal to a third party on behalfof the producer or seller of such coal and—(A) is indicated in the shipper’s exportdeclaration or other documentation as the exporter of record, or(B) actually exported such coal to a foreign country or shipped such coal to a possession of the United States, or caused such coalto be so exported or shipped.(3) RELATED PARTY.—The term ‘‘a party related to such coal producer’’ means a person who—(A) is related to such coal producerthrough any degree of common management,stock ownership, or voting control,(B) is related (within the meaning of section 144(a)(3) of the Internal Revenue Code of1986) to such coal producer, or(C) has a contract, fee arrangement, orany other agreement with such coal producer tosell such coal to a third party on behalf of suchcoal producer.(4) SECRETARY.—The term ‘‘Secretary’’ meansthe Secretary of Treasury or the Secretary’s designee.S.L.C.(e) TIMING REFUND.—With respect to any claimOFfor refund filed pursuant to this section, the Secretaryshall determine whether the requirements of this sectionare met not later than 180 days after such claim is filed.If the Secretary determines that the requirements of thissection are met, the claim for refund shall be paid notlater than 180 days after the Secretary makes such determination.(f) INTEREST.—Any refund paid pursuant to thissection shall be paid by the Secretary with interest fromthe date of overpayment determined by using the overpayment rate and method under section 6621 of the InternalRevenue Code of 1986.(g) DENIAL DOUBLE BENEFIT.—The paymentOFunder subsection (a) with respect to any coal shall not exceed—(1) in the case of a payment to a coal producer,the amount of tax paid under section 4121 of theInternal Revenue Code of 1986 with respect to suchcoal by such coal producer or a party related to suchcoal producer, and(2) in the case of a payment to an exporter, anamount equal to $0.825 per ton with respect to suchcoal exported by the exporter or caused to be exported by the exporter.S.L.C.(h) APPLICATION SECTION.—This section appliesOFonly to claims on coal exported or shipped on or after October 1, 1990, through the date of the enactment of thisAct.(i) STANDING NOT CONFERRED.—(1) EXPORTERS.—With respect to exporters,this section shall not confer standing upon an exporter to commence, or intervene in, any judicial oradministrative proceeding concerning a claim for refund by a coal producer of any Federal or State tax,fee, or royalty paid by the coal producer.(2) COAL PRODUCERS.—With respect to coalproducers, this section shall not confer standingupon a coal producer to commence, or intervene in,any judicial or administrative proceeding concerninga claim for refund by an exporter of any Federal orState tax, fee, or royalty paid by the producer andalleged to have been passed on to an exporter.SEC. 115. TAX CREDIT FOR CARBON DIOXIDE SEQUESTRATION.(a) IN GENERAL.—Subpart D of part IV of subchapter A of chapter 1 (relating to business credits) isamended by adding at the end the following new section:S.L.C.‘‘SEC. 45Q. CREDIT FOR CARBON DIOXIDE SEQUESTRATION.‘‘(a) GENERAL RULE.—For purposes of section 38,the carbon dioxide sequestration credit for any taxableyear is an amount equal to the sum of—‘‘(1) $20 per metric ton of qualified carbon dioxide which is—‘‘(A) captured by the taxpayer at a qualified facility, and‘‘(B) disposed of by the taxpayer in securegeological storage, and‘‘(2) $10 per metric ton of qualified carbon dioxide which is—‘‘(A) captured by the taxpayer at a qualified facility, and‘‘(B) used by the taxpayer as a tertiaryinjectant in a qualified enhanced oil or naturalgas recovery project.‘‘(b) QUALIFIED CARBON DIOXIDE.—For purposes ofthis section—‘‘(1) IN GENERAL.—The term ‘qualified carbondioxide’ means carbon dioxide captured from an industrial source which—‘‘(A) would otherwise be released into theatmosphere as industrial emission of greenhouse gas, andS.L.C.‘‘(B) is measured at the source of captureand verified at the point of disposal or injection.‘‘(2) RECYCLED CARBON DIOXIDE.—The term‘qualified carbon dioxide’ includes the initial depositof captured carbon dioxide used as a tertiaryinjectant. Such term does not include carbon dioxidethat is re-captured, recycled, and re-injected as partof the enhanced oil and natural gas recovery process.‘‘(c) QUALIFIED FACILITY.—For purposes of thissection, the term ‘qualified facility’ means any industrialfacility—‘‘(1) which is owned by the taxpayer,‘‘(2) at which carbon capture equipment isplaced in service, and‘‘(3) which captures not less than 500,000 metric tons of carbon dioxide during the taxable year.‘‘(d) SPECIAL RULES OTHER DEFINITIONS.—ANDFor purposes of this section—‘‘(1) ONLY CARBON DIOXIDE CAPTURED ANDDISPOSED OF OR USED WITHIN THE UNITED STATESTAKEN INTO ACCOUNT.—The credit under this section shall apply only with respect to qualified carbondioxide the capture and disposal or use of which iswithin—S.L.C.‘‘(A) the United States (within the meaning of section 638(1)), or‘‘(B) a possession of the United States(within the meaning of section 638(2)).‘‘(2) SECURE GEOLOGICAL STORAGE.—The Secretary, in consultation with the Administrator of theEnvironmental Protection Agency, shall establishregulations for determining adequate security measures for the geological storage of carbon dioxideunder subsection (a)(1)(B) such that the carbon dioxide does not escape into the atmosphere. Suchterm shall include storage at deep saline formationsand unminable coal seems under such conditions asthe Secretary may determine under such regulations.‘‘(3) TERTIARY INJECTANT.—The term ‘tertiary injectant’ has the same meaning as when usedwithin section 193(b)(1).‘‘(4) QUALIFIED ENHANCED OIL OR NATURALGAS RECOVERY PROJECT.—The term ‘qualified enhanced oil or natural gas recovery project’ has themeaning given the term ‘qualified enhanced oil recovery project’ by section 43(c)(2), by substituting‘crude oil or natural gas’ for ‘crude oil’ in subparagraph (A)(i) thereof.S.L.C.‘‘(5) CREDIT ATTRIBUTABLE TO TAXPAYER.—Any credit under this section shall be attributable tothe person that captures and physically or contractually ensures the disposal of or the use as a tertiaryinjectant of the qualified carbon dioxide, except tothe extent provided in regulations prescribed by theSecretary.‘‘(6) RECAPTURE.—The Secretary shall, by regulations, provide for recapturing the benefit of anycredit allowable under subsection (a) with respect toany qualified carbon dioxide which ceases to be captured, disposed of, or used as a tertiary injectant ina manner consistent with the requirements of thissection.‘‘(7) INFLATION ADJUSTMENT.—In the case ofany taxable year beginning in a calendar year after2009, there shall be substituted for each dollaramount contained in subsection (a) an amount equalto the product of—‘‘(A) such dollar amount, multiplied by‘‘(B) the inflation adjustment factor forsuch calendar year determined under section43(b)(3)(B) for such calendar year, determinedby substituting ‘2008’ for ‘1990’.S.L.C.‘‘(e) APPLICATION SECTION.—The credit underOFthis section shall apply with respect to qualified carbondioxide before the end of the calendar year in which theSecretary, in consultation with the Administrator of theEnvironmental Protection Agency, certifies that75,000,000 metric tons of qualified carbon dioxide havebeen captured and disposed of or used as a tertiaryinjectant.’’.(b) CONFORMING AMENDMENT.—Section 38(b) (relating to general business credit) is amended by striking‘‘plus’’ at the end of paragraph (32), by striking the periodat the end of paragraph (33) and inserting ‘‘, plus’’, andby adding at the end of following new paragraph:‘‘(34) the carbon dioxide sequestration creditdetermined under section 45Q(a).’’.(c) CLERICAL AMENDMENT.—The table of sectionsfor subpart B of part IV of subchapter A of chapter 1(relating to other credits) is amended by adding at theend the following new section:‘‘Sec. 45Q. Credit for carbon dioxide sequestration.’’.(d) EFFECTIVE DATE.—The amendments made bythis section shall apply to carbon dioxide captured afterthe date of the enactment of this Act.S.L.C.SEC. 116. CERTAIN INCOME AND GAINS RELATING TO INDUSTRIAL SOURCE CARBON DIOXIDE TREATED AS QUALIFYING INCOME FOR PUBLICLYTRADED PARTNERSHIPS.(a) IN GENERAL.—Subparagraph (E) of section7704(d)(1) (defining qualifying income) is amended by inserting ‘‘or industrial source carbon dioxide’’ after ‘‘timber)’’.(b) EFFECTIVE DATE.—The amendment made bythis section shall take effect on the date of the enactmentof this Act, in taxable years ending after such date.SEC. 117. CARBON AUDIT OF THE TAX CODE.(a) STUDY.—The Secretary of the Treasury shallenter into an agreement with the National Academy ofSciences to undertake a comprehensive review of the Internal Revenue Code of 1986 to identify the types of andspecific tax provisions that have the largest effects on carbon and other greenhouse gas emissions and to estimatethe magnitude of those effects.(b) REPORT.—Not later than 2 years after the dateof enactment of this Act, the National Academy ofSciences shall submit to Congress a report containing theresults of study authorized under this section.(c) AUTHORIZATION APPROPRIATIONS.—There isOFauthorized to be appropriated to carry out this section$1,500,000 for the period of fiscal years 2009 and 2010.S.L.C.TITLE II—TRANSPORTATIONAND DOMESTIC FUEL SECU 2RITY PROVISIONSSEC. 201. INCLUSION OF CELLULOSIC BIOFUEL IN BONUSDEPRECIATION FOR BIOMASS ETHANOLPLANT PROPERTY.(a) IN GENERAL.—Paragraph (3) of section 168(l)is amended to read as follows:‘‘(3) CELLULOSIC BIOFUEL.—The term ‘cellulosic biofuel’ means any liquid fuel which is produced from any lignocellulosic or hemicellulosic matter that is available on a renewable or recurringbasis.’’.(b) CONFORMING AMENDMENTS.—Subsection (l) ofsection 168 is amended—(1) by striking ‘‘cellulosic biomass ethanol’’each place it appears and inserting ‘‘cellulosicbiofuel’’,(2) by striking ‘‘CELLULOSIC BIOMASS ETHANOL’’ in the heading of such subsection and inserting ‘‘CELLULOSIC BIOFUEL’’, and(3) by striking ‘‘CELLULOSIC BIOMASS ETHANOL’’ in the heading of paragraph (2) thereof andinserting ‘‘CELLULOSIC BIOFUEL’’.S.L.C.(c) EFFECTIVE DATE.—The amendments made bythis section shall apply to property placed in service afterthe date of the enactment of this Act, in taxable yearsending after such date.SEC. 202. CREDITS FOR BIODIESEL AND RENEWABLE DIESEL.(a) IN GENERAL.—Sections 40A(g), 6426(c)(6), and6427(e)(5)(B) are each amended by striking ‘‘December31, 2008’’ and inserting ‘‘December 31, 2009’’.(b) INCREASE IN RATE OF CREDIT.—(1) INCOME TAX CREDIT.—Paragraphs (1)(A)and (2)(A) of section 40A(b) are each amended bystriking ‘‘50 cents’’ and inserting ‘‘$1.00’’.(2) EXCISE TAX CREDIT.—Paragraph (2) ofsection 6426(c) is amended to read as follows:‘‘(2) APPLICABLE AMOUNT.—For purposes ofthis subsection, the applicable amount is $1.00.’’.(3) CONFORMING AMENDMENTS.—(A) Subsection (b) of section 40A isamended by striking paragraph (3) and by redesignating paragraphs (4) and (5) as paragraphs (3) and (4), respectively.(B) Paragraph (2) of section 40A(f) isamended to read as follows:S.L.C.‘‘(2) EXCEPTION.—Subsection (b)(4) shall notapply with respect to renewable diesel.’’.(C) Paragraphs (2) and (3) of section40A(e) are each amended by striking ‘‘subsection (b)(5)(C)’’ and inserting ‘‘subsection(b)(4)(C)’’.(D) Clause (ii) of section 40A(d)(3)(C) isamended by striking ‘‘subsection (b)(5)(B)’’and inserting ‘‘subsection (b)(4)(B)’’.(c) UNIFORM TREATMENT DIESEL PRODUCEDOFFROM BIOMASS.—Paragraph (3) of section 40A(f) isamended—(1) by striking ‘‘diesel fuel’’ and inserting ‘‘liquid fuel’’,(2) by striking ‘‘using a thermaldepolymerization process’’, and(3) by inserting ‘‘, or other equivalent standardapproved by the Secretary’’ after ‘‘D396’’.(d) COPRODUCTION RENEWABLE DIESEL WITHOFPETROLEUM FEEDSTOCK.—(1) IN GENERAL.—Paragraph (3) of section40A(f) is amended by adding at the end the following new sentences: ‘‘Such term does not includeany fuel derived from coprocessing biomass with afeedstock which is not biomass. For purposes of thisS.L.C.paragraph, the term ‘biomass’ has the meaninggiven such term by section 45K(c)(3).’’.(2) CONFORMING AMENDMENT.—Paragraph (3)of section 40A(f) is amended by striking ‘‘(as defined in section 45K(c)(3))’’.(e) ELIGIBILITY OF CERTAIN AVIATION FUEL.—Subsection (f) of section 40A (relating to renewable diesel)is amended by adding at the end the following new paragraph:‘‘(4) CERTAIN AVIATION FUEL.—‘‘(A) IN GENERAL.—Except as provided inthe last 3 sentences of paragraph (3), the term‘renewable diesel’ shall include fuel derived frombiomass which meets the requirements of a Department of Defense specification for militaryjet fuel or an American Society of Testing andMaterials specification for aviation turbine fuel.‘‘(B) APPLICATION CRED OF MIXTUREITS.—In the case of fuel which is treated as renewable diesel solely by reason of subparagraph(A), subsection (b)(1) and section 6426(c) shallbe applied with respect to such fuel by treatingkerosene as though it were diesel fuel.’’.(f) MODIFICATION RELATING DEFINITIONTO OFAGRI-BIODIESEL.—Paragraph (2) of section 40A(d) (reO:\AYO\AYO08C32.xml S.L.C.lating to agri-biodiesel) is amended by striking ‘‘and mustard seeds’’ and inserting ‘‘mustard seeds, and camelina’’.(g) EFFECTIVE DATE.—(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments made bythis section shall apply to fuel produced, and sold orused, after December 31, 2008.(2) COPRODUCTION OF RENEWABLE DIESELWITH PETROLEUM FEEDSTOCK.—The amendmentmade by subsection (d) shall apply to fuel produced,and sold or used, after the date of the enactment ofthis Act.SEC. 203. CLARIFICATION THAT CREDITS FOR FUEL AREDESIGNED TO PROVIDE AN INCENTIVE FORUNITED STATES PRODUCTION.(a) ALCOHOL FUELS CREDIT.—Subsection (d) ofsection 40 is amended by adding at the end the followingnew paragraph:‘‘(7) LIMITATION TO ALCOHOL WITH CONNECTION TO THE UNITED STATES.—No credit shall bedetermined under this section with respect to any alcohol which is produced outside the United Statesfor use as a fuel outside the United States. For purposes of this paragraph, the term ‘United States’ includes any possession of the United States.’’.S.L.C.(b) BIODIESEL FUELS CREDIT.—Subsection (d) ofsection 40A is amended by adding at the end the followingnew paragraph:‘‘(5) LIMITATION TO BIODIESEL WITH CONNECTION TO THE UNITED STATES.—No credit shall bedetermined under this section with respect to anybiodiesel which is produced outside the UnitedStates for use as a fuel outside the United States.For purposes of this paragraph, the term ‘UnitedStates’ includes any possession of the UnitedStates.’’.(c) EXCISE TAX CREDIT.—(1) IN GENERAL.—Section 6426 is amended byadding at the end the following new subsection:‘‘(i) LIMITATION FUELS WITH CONNECTIONTO TOUNITED STATES.—THE‘‘(1) ALCOHOL.—No credit shall be determinedunder this section with respect to any alcohol whichis produced outside the United States for use as afuel outside the United States.‘‘(2) BIODIESEL AND ALTERNATIVE FUELS.—No credit shall be determined under this sectionwith respect to any biodiesel or alternative fuelwhich is produced outside the United States for useas a fuel outside the United States.S.L.C.For purposes of this subsection, the term ‘United States’includes any possession of the United States.’’.(2) CONFORMING AMENDMENT.—Subsection (e)of section 6427 is amended by redesignating paragraph (5) as paragraph (6) and by inserting afterparagraph (4) the following new paragraph:‘‘(5) LIMITATION TO FUELS WITH CONNECTIONTO THE UNITED STATES.—No amount shall be payable under paragraph (1) or (2) with respect to anymixture or alternative fuel if credit is not allowedwith respect to such mixture or alternative fuel byreason of section 6426(i).’’.(d) EFFECTIVE DATE.—The amendments made bythis section shall apply to claims for credit or paymentmade on or after May 15, 2008.SEC. 204. EXTENSION AND MODIFICATION OF ALTERNATIVE FUEL CREDIT.(a) EXTENSION.—(1) ALTERNATIVE FUEL CREDIT.—Paragraph(4) of section 6426(d) (relating to alternative fuelcredit) is amended by striking ‘‘September 30,2009’’ and inserting ‘‘December 31, 2009’’.(2) ALTERNATIVE FUEL MIXTURE CREDIT.—Paragraph (3) of section 6426(e) (relating to alternative fuel mixture credit) is amended by strikingS.L.C.‘‘September 30, 2009’’ and inserting ‘‘December 31,2009’’.(3) PAYMENTS.—Subparagraph (C) of section6427(e)(5) (relating to termination) is amended bystriking ‘‘September 30, 2009’’ and inserting ‘‘December 31, 2009’’.(b) MODIFICATIONS.—(1) ALTERNATIVE COM FUEL TO INCLUDEPRESSED OR LIQUIFIED BIOMASS GAS.—Paragraph(2) of section 6426(d) (relating to alternative fuelcredit) is amended by striking ‘‘and’’ at the end ofsubparagraph (E), by redesignating subparagraph(F) as subparagraph (G), and by inserting after subparagraph (E) the following new subparagraph:‘‘(F) compressed or liquefied gas derivedfrom biomass (as defined in section 45K(c)(3)),and’’.(2) CREDIT ALLOWED FOR AVIATION USE OFFUEL.—Paragraph (1) of section 6426(d) is amended by inserting ‘‘sold by the taxpayer for use as afuel in aviation,’’ after ‘‘motorboat,’’.(c) CARBON CAPTURE REQUIREMENT CERTAINFORFUELS.—(1) IN GENERAL.—Subsection (d) of section6426, as amended by subsection (a), is amended byS.L.C.redesignating paragraph (4) as paragraph (5) andby inserting after paragraph (3) the following newparagraph:‘‘(4) CARBON CAPTURE REQUIREMENT.—‘‘(A) IN GENERAL.—The requirements ofthis paragraph are met if the fuel is certified,under such procedures as required by the Secretary, as having been derived from coal produced at a gasification facility which separatesand sequesters not less than the applicable percentage of such facility’s total carbon dioxideemissions.‘‘(B) APPLICABLE PERCENTAGE.—Forpurposes of subparagraph (A), the applicablepercentage is—‘‘(i) 50 percent in the case of fuel produced after September 30, 2009, and on orbefore December 30, 2009, and‘‘(ii) 75 percent in the case of fuelproduced after December 30, 2009.’’.(2) CONFORMING AMENDMENT.—Subparagraph(E) of section 6426(d)(2) is amended by inserting‘‘which meets the requirements of paragraph (4) andwhich is’’ after ‘‘any liquid fuel’’.S.L.C.(d) EFFECTIVE DATE.—The amendments made bythis section shall apply to fuel sold or used after the dateof the enactment of this Act.SEC. 205. CREDIT FOR NEW QUALIFIED PLUG-IN ELECTRICDRIVE MOTOR VEHICLES.(a) PLUG-IN ELECTRIC DRIVE MOTOR VEHICLECREDIT.—Subpart B of part IV of subchapter A of chapter 1 (relating to other credits) is amended by adding atthe end the following new section:‘‘SEC. 30D. NEW QUALIFIED PLUG-IN ELECTRIC DRIVEMOTOR VEHICLES.‘‘(a) ALLOWANCE OF CREDIT.—‘‘(1) IN GENERAL.—There shall be allowed as acredit against the tax imposed by this chapter forthe taxable year an amount equal to the applicableamount with respect to each new qualified plug-inelectric drive motor vehicle placed in service by thetaxpayer during the taxable year.‘‘(2) APPLICABLE AMOUNT.—For purposes ofparagraph (1), the applicable amount is sum of—‘‘(A) $2,500, plus‘‘(B) $417 for each kilowatt hour of traction battery capacity in excess of 4 kilowatthours.‘‘(b) LIMITATIONS.—S.L.C.‘‘(1) LIMITATION WEIGHT.—TheBASED ONamount of the credit allowed under subsection (a) byreason of subsection (a)(2) shall not exceed—‘‘(A) $7,500, in the case of any new qualified plug-in electric drive motor vehicle with agross vehicle weight rating of not more than10,000 pounds,‘‘(B) $10,000, in the case of any newqualified plug-in electric drive motor vehiclewith a gross vehicle weight rating of more than10,000 pounds but not more than 14,000pounds,‘‘(C) $12,500, in the case of any newqualified plug-in electric drive motor vehiclewith a gross vehicle weight rating of more than14,000 pounds but not more than 26,000pounds, and‘‘(D) $15,000, in the case of any newqualified plug-in electric drive motor vehiclewith a gross vehicle weight rating of more than26,000 pounds.‘‘(2) LIMITATION ON NUMBER OF PASSENGERVEHICLES AND LIGHT TRUCKS ELIGIBLE FOR CREDIT.—S.L.C.‘‘(A) IN GENERAL.—In the case of a newqualified plug-in electric drive motor vehiclesold during the phaseout period, only the applicable percentage of the credit otherwise allowable under subsection (a) shall be allowed.‘‘(B) PHASEOUT PERIOD.—For purposesof this subsection, the phaseout period is theperiod beginning with the second calendar quarter following the calendar quarter which includes the first date on which the total numberof such new qualified plug-in electric drivemotor vehicles sold for use in the United Statesafter December 31, 2008, is at least 250,000.‘‘(C) APPLICABLE PERCENTAGE.—Forpurposes of subparagraph (A), the applicablepercentage is—‘‘(i) 50 percent for the first 2 calendar quarters of the phaseout period,‘‘(ii) 25 percent for the 3d and 4thcalendar quarters of the phaseout period,and‘‘(iii) 0 percent for each calendarquarter thereafter.S.L.C.‘‘(D) CONTROLLED GROUPS.—Rules similar to the rules of section 30B(f)(4) shall applyfor purposes of this subsection.‘‘(c) NEW QUALIFIED PLUG-IN ELECTRIC DRIVEMOTOR VEHICLE.—For purposes of this section, the term‘new qualified plug-in electric drive motor vehicle’ meansa motor vehicle—‘‘(1) which draws propulsion using a tractionbattery with at least 4 kilowatt hours of capacity,‘‘(2) which uses an offboard source of energy torecharge such battery,‘‘(3) which, in the case of a passenger vehicleor light truck which has a gross vehicle weight rating of not more than 8,500 pounds, has received acertificate of conformity under the Clean Air Actand meets or exceeds the equivalent qualifying California low emission vehicle standard under section243(e)(2) of the Clean Air Act for that make andmodel year, and‘‘(A) in the case of a vehicle having a grossvehicle weight rating of 6,000 pounds or less,the Bin 5 Tier II emission standard establishedin regulations prescribed by the Administratorof the Environmental Protection Agency underS.L.C.section 202(i) of the Clean Air Act for thatmake and model year vehicle, and‘‘(B) in the case of a vehicle having a grossvehicle weight rating of more than 6,000pounds but not more than 8,500 pounds, theBin 8 Tier II emission standard which is so established,‘‘(4) the original use of which commences withthe taxpayer,‘‘(5) which is acquired for use or lease by thetaxpayer and not for resale, and‘‘(6) which is made by a manufacturer.‘‘(d) APPLICATION WITH OTHER CREDITS.—‘‘(1) BUSINESS CREDIT TREATED AS PART OFGENERAL BUSINESS CREDIT.—So much of the creditwhich would be allowed under subsection (a) for anytaxable year (determined without regard to this subsection) that is attributable to property of a character subject to an allowance for depreciation shallbe treated as a credit listed in section 38(b) for suchtaxable year (and not allowed under subsection (a)).‘‘(2) PERSONAL CREDIT.—‘‘(A) IN GENERAL.—For purposes of thistitle, the credit allowed under subsection (a) forany taxable year (determined after applicationS.L.C.of paragraph (1)) shall be treated as a creditallowable under subpart A for such taxableyear.‘‘(B) LIMITATION BASED ON AMOUNT OFTAX.—In the case of a taxable year to whichsection 26(a)(2) does not apply, the credit allowed under subsection (a) for any taxable year(determined after application of paragraph (1))shall not exceed the excess of—‘‘(i) the sum of the regular tax liability (as defined in section 26(b)) plus thetax imposed by section 55, over‘‘(ii) the sum of the credits allowableunder subpart A (other than this sectionand sections 23 and 25D) and section 27for the taxable year.‘‘(e) OTHER DEFINITIONS SPECIAL RULES.—ANDFor purposes of this section—‘‘(1) MOTOR VEHICLE.—The term ‘motor vehicle’ has the meaning given such term by section30(c)(2).‘‘(2) OTHER TERMS.—The terms ‘passengerautomobile’, ‘light truck’, and ‘manufacturer’ havethe meanings given such terms in regulations prescribed by the Administrator of the EnvironmentalS.L.C.Protection Agency for purposes of the administration of title II of the Clean Air Act (42 U.S.C. 7521et seq.).‘‘(3) TRACTION BATTERY CAPACITY.—Tractionbattery capacity shall be measured in kilowatt hoursfrom a 100 percent state of charge to a zero percentstate of charge.‘‘(4) REDUCTION IN BASIS.—For purposes ofthis subtitle, the basis of any property for which acredit is allowable under subsection (a) shall be reduced by the amount of such credit so allowed.‘‘(5) NO DOUBLE BENEFIT.—The amount ofany deduction or other credit allowable under thischapter for a new qualified plug-in electric drivemotor vehicle shall be reduced by the amount ofcredit allowed under subsection (a) for such vehiclefor the taxable year.‘‘(6) PROPERTY USED BY TAX-EXEMPT ENTITY.—In the case of a vehicle the use of which is described in paragraph (3) or (4) of section 50(b) andwhich is not subject to a lease, the person who soldsuch vehicle to the person or entity using such vehicle shall be treated as the taxpayer that placed suchvehicle in service, but only if such person clearly discloses to such person or entity in a document theS.L.C.amount of any credit allowable under subsection (a)with respect to such vehicle (determined without regard to subsection (b)(2)).‘‘(7) PROPERTY USED OUTSIDE UNITEDSTATES, ETC., NOT QUALIFIED.—No credit shall beallowable under subsection (a) with respect to anyproperty referred to in section 50(b)(1) or with respect to the portion of the cost of any propertytaken into account under section 179.‘‘(8) RECAPTURE.—The Secretary shall, by regulations, provide for recapturing the benefit of anycredit allowable under subsection (a) with respect toany property which ceases to be property eligible forsuch credit (including recapture in the case of alease period of less than the economic life of a vehicle).‘‘(9) ELECTION TO NOT TAKE CREDIT.—Nocredit shall be allowed under subsection (a) for anyvehicle if the taxpayer elects not to have this sectionapply to such vehicle.‘‘(10) INTERACTION WITH AIR QUALITY ANDMOTOR VEHICLE SAFETY STANDARDS.—Unless otherwise provided in this section, a motor vehicle shallnot be considered eligible for a credit under this section unless such vehicle is in compliance with—S.L.C.‘‘(A) the applicable provisions of the CleanAir Act for the applicable make and model yearof the vehicle (or applicable air quality provisions of State law in the case of a State whichhas adopted such provision under a waiverunder section 209(b) of the Clean Air Act), and‘‘(B) the motor vehicle safety provisions ofsections 30101 through 30169 of title 49,United States Code.‘‘(f) REGULATIONS.—‘‘(1) IN GENERAL.—Except as provided in paragraph (2), the Secretary shall promulgate such regulations as necessary to carry out the provisions ofthis section.‘‘(2) COORDINATION IN PRESCRIPTION OF CERTAIN REGULATIONS.—The Secretary of the Treasury, in coordination with the Secretary of Transportation and the Administrator of the EnvironmentalProtection Agency, shall prescribe such regulationsas necessary to determine whether a motor vehiclemeets the requirements to be eligible for a creditunder this section.‘‘(g) TERMINATION.—This section shall not apply toproperty purchased after December 31, 2014.’’.S.L.C.(b) COORDINATION WITH ALTERNATIVE MOTOR VECREDIT.—Section 30B(d)(3) is amended by addingHICLEat the end the following new subparagraph:‘‘(D) EXCLUSION OF PLUG-IN VEHICLES.—Any vehicle with respect to which a credit is allowable under section 30D (determined withoutregard to subsection (d) thereof) shall not betaken into account under this section.’’.(c) CREDIT MADE PART GENERAL BUSINESSOFCREDIT.—Section 38(b), as amended by this Act, isamended by striking ‘‘plus’’ at the end of paragraph (33),by striking the period at the end of paragraph (34) andinserting ‘‘plus’’, and by adding at the end the followingnew paragraph:‘‘(35) the portion of the new qualified plug-inelectric drive motor vehicle credit to which section30D(d)(1) applies.’’.(d) CONFORMING AMENDMENTS.—(1)(A) Section 24(b)(3)(B), as amended by section 106, is amended by striking ‘‘and 25D’’ and inserting ‘‘25D, and 30D’’.(B) Section 25(e)(1)(C)(ii) is amended by inserting ‘‘30D,’’ after ‘‘25D,’’.S.L.C.(C) Section 25B(g)(2), as amended by section106, is amended by striking ‘‘and 25D’’ and inserting ‘‘, 25D, and 30D’’.(D) Section 26(a)(1), as amended by section106, is amended by striking ‘‘and 25D’’ and inserting ‘‘25D, and 30D’’.(E) Section 1400C(d)(2) is amended by striking‘‘and 25D’’ and inserting ‘‘25D, and 30D’’.(2) Section 1016(a) is amended by striking‘‘and’’ at the end of paragraph (35), by striking theperiod at the end of paragraph (36) and inserting ‘‘,and’’, and by adding at the end the following newparagraph:‘‘(37) to the extent provided in section30D(e)(4).’’.(3) Section 6501(m) is amended by inserting‘‘30D(e)(9),’’ after ‘‘30C(e)(5),’’.(4) The table of sections for subpart B of partIV of subchapter A of chapter 1 is amended by adding at the end the following new item:‘‘Sec. 30D. New qualified plug-in electric drive motor vehicles.’’.(e) EFFECTIVE DATE.—The amendments made bythis section shall apply to taxable years beginning afterDecember 31, 2008.(f) APPLICATION EGTRRA SUNSET.—TheOFamendment made by subsection (d)(1)(A) shall be subjectS.L.C.to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 in the same manner as the provision of such Act to which such amendment relates.SEC. 206. EXCLUSION FROM HEAVY TRUCK TAX FOR IDLINGREDUCTION UNITS AND ADVANCED INSULATION.(a) IN GENERAL.—Section 4053 is amended by adding at the end the following new paragraphs:‘‘(9) IDLING REDUCTION DEVICE.—Any deviceor system of devices which—‘‘(A) is designed to provide to a vehiclethose services (such as heat, air conditioning, orelectricity) that would otherwise require the operation of the main drive engine while the vehicle is temporarily parked or remains stationaryusing one or more devices affixed to a tractor,and‘‘(B) is determined by the Administrator ofthe Environmental Protection Agency, in consultation with the Secretary of Energy and theSecretary of Transportation, to reduce idling ofsuch vehicle at a motor vehicle rest stop orother location where such vehicles are temporarily parked or remain stationary.S.L.C.‘‘(10) ADVANCED INSULATION.—Any insulationthat has an R value of not less than R35 per inch.’’.(b) EFFECTIVE DATE.—The amendment made bythis section shall apply to sales or installations after thedate of the enactment of this Act.SEC. 207. ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY CREDIT.(a) EXTENSION CREDIT.—Paragraph (2) of sec OFtion 30C(g) is amended by striking ‘‘December 31, 2009’’and inserting ‘‘December 31, 2010’’.(b) INCLUSION ELECTRICITY CLEAN-BURN OF AS AFUEL.—Section 30C(c)(2) is amended by adding atINGthe end the following new subparagraph:‘‘(C) Electricity.’’.(c) EFFECTIVE DATE.—The amendments made bythis section shall apply to property placed in service afterthe date of the enactment of this Act, in taxable yearsending after such date.S.L.C.SEC. 208. CERTAIN INCOME AND GAINS RELATING TO ALCOHOL FUELS AND MIXTURES, BIODIESELFUELS AND MIXTURES, AND ALTERNATIVEFUELS AND MIXTURES TREATED AS QUALIFYING INCOME FOR PUBLICLY TRADEDPARTNERSHIPS.(a) IN GENERAL.—Subparagraph (E) of section7704(d)(1), as amended by this Act, is amended by striking ‘‘or industrial source carbon dioxide’’ and inserting ‘‘,industrial source carbon dioxide, or the transportation orstorage of any fuel described in subsection (b), (c), (d),or (e) of section 6426, or any alcohol fuel defined in section 6426(b)(4)(A) or any biodiesel fuel as defined in section 40A(d)(1)’’ after ‘‘timber)’’.(b) EFFECTIVE DATE.—The amendment made bythis section shall take effect on the date of the enactmentof this Act, in taxable years ending after such date.SEC. 209. EXTENSION AND MODIFICATION OF ELECTION TOEXPENSE CERTAIN REFINERIES.(a) EXTENSION.—Paragraph (1) of section 179C(c)(relating to qualified refinery property) is amended—(1) by striking ‘‘January 1, 2012’’ in subparagraph (B) and inserting ‘‘January 1, 2014’’, and(2) by striking ‘‘January 1, 2008’’ each placeit appears in subparagraph (F) and inserting ‘‘January 1, 2010’’.S.L.C.(b) INCLUSION OF FUEL DERIVED FROM SHALE ANDTAR SANDS.—(1) IN GENERAL.—Subsection (d) of section179C is amended by inserting ‘‘, or directly fromshale or tar sands’’ after ‘‘(as defined in section45K(c))’’.(2) CONFORMING AMENDMENT.—Paragraph (2)of section 179C(e) is amended by inserting ‘‘shale,tar sands, or’’ before ‘‘qualified fuels’’.(c) EFFECTIVE DATE.—The amendments made bythis section shall apply to property placed in service afterthe date of the enactment of this Act.SEC. 210. EXTENSION OF SUSPENSION OF TAXABLE INCOME LIMIT ON PERCENTAGE DEPLETIONFOR OIL AND NATURAL GAS PRODUCEDFROM MARGINAL PROPERTIES.Subparagraph (H) of section 613A(c)(6) (relating tooil and gas produced from marginal properties) is amended by striking ‘‘for any taxable year’’ and all that followsand inserting ‘‘for any taxable year—‘‘(i) beginning after December 31,1997, and before January 1, 2008, or‘‘(ii) beginning after December 31,2008, and before January 1, 2010.’’.S.L.C.SEC. 211. TRANSPORTATION FRINGE BENEFIT TO BICYCLECOMMUTERS.(a) IN GENERAL.—Paragraph (1) of section 132(f)is amended by adding at the end the following:‘‘(D) Any qualified bicycle commuting reimbursement.’’.(b) LIMITATION EXCLUSION.—Paragraph (2) ofONsection 132(f) is amended by striking ‘‘and’’ at the endof subparagraph (A), by striking the period at the endof subparagraph (B) and inserting ‘‘, and’’, and by addingat the end the following new subparagraph:‘‘(C) the applicable annual limitation inthe case of any qualified bicycle commuting reimbursement.’’.(c) DEFINITIONS.—Paragraph (5) of section 132(f)is amended by adding at the end the following:‘‘(F) DEFINITIONS RELATED TO BICYCLECOMMUTING REIMBURSEMENT.—‘‘(i) QUALIFIED BICYCLE COMMUTINGREIMBURSEMENT.—The term ‘qualified bicycle commuting reimbursement’ means,with respect to any calendar year, any employer reimbursement during the 15-monthperiod beginning with the first day of suchcalendar year for reasonable expenses incurred by the employee during such calO:\AYO\AYO08C32.xml S.L.C.endar year for the purchase of a bicycleand bicycle improvements, repair, and storage, if such bicycle is regularly used fortravel between the employee’s residenceand place of employment.‘‘(ii) APPLICABLE LIMITA ANNUALTION.—The term ‘applicable annual limitation’ means, with respect to any employeefor any calendar year, the product of $20multiplied by the number of qualified bicycle commuting months during such year.‘‘(iii) QUALIFIED COM BICYCLEMUTING MONTH.—The term ‘qualified bicycle commuting month’ means, with respect to any employee, any month duringwhich such employee—‘‘(I) regularly uses the bicycle fora substantial portion of the travel between the employee’s residence andplace of employment, and‘‘(II) does not receive any benefitdescribed in subparagraph (A), (B),or (C) of paragraph (1).’’.(d) CONSTRUCTIVE RECEIPT BENEFIT.—Para OFgraph (4) of section 132(f) is amended by insertingS.L.C.‘‘(other than a qualified bicycle commuting reimbursement)’’ after ‘‘qualified transportation fringe’’.(e) EFFECTIVE DATE.—The amendments made bythis section shall apply to taxable years beginning afterDecember 31, 2008.TITLE III—ENERGY CONSERVA 6TION AND EFFICIENCY PRO 7VISIONSSEC. 301. QUALIFIED ENERGY CONSERVATION BONDS.(a) IN GENERAL.—Subpart I of part IV of subchapter A of chapter 1, as amended by section 107, isamended by adding at the end the following new section:‘‘SEC. 54D. QUALIFIED ENERGY CONSERVATION BONDS.‘‘(a) QUALIFIED ENERGY CONSERVATION BOND.—For purposes of this subchapter, the term ‘qualified energy conservation bond’ means any bond issued as partof an issue if—‘‘(1) 100 percent of the available project proceeds of such issue are to be used for one or morequalified conservation purposes,‘‘(2) the bond is issued by a State or local government, and‘‘(3) the issuer designates such bond for purposes of this section.S.L.C.‘‘(b) REDUCED CREDIT AMOUNT.—The annual creditdetermined under section 54A(b) with respect to anyqualified energy conservation bond shall be 70 percent ofthe amount so determined without regard to this subsection.‘‘(c) LIMITATION AMOUNT BONDS DES ON OFIGNATED.—The maximum aggregate face amount ofbonds which may be designated under subsection (a) byany issuer shall not exceed the limitation amount allocatedto such issuer under subsection (e).‘‘(d) NATIONAL LIMITATION AMOUNT BONDSON OFDESIGNATED.—There is a national qualified energy conservation bond limitation of $800,000,000.‘‘(e) ALLOCATIONS.—‘‘(1) IN GENERAL.—The limitation applicableunder subsection (d) shall be allocated by the Secretary among the States in proportion to the population of the States.‘‘(2) ALLOCATIONS TO LARGEST LOCAL GOVERNMENTS.—‘‘(A) IN GENERAL.—In the case of anyState in which there is a large local government, each such local government shall be allocated a portion of such State’s allocation whichbears the same ratio to the State’s allocationS.L.C.(determined without regard to this subparagraph) as the population of such large localgovernment bears to the population of suchState.‘‘(B) ALLOCATION OF UNUSED LIMITATIONTO STATE.—The amount allocated under thissubsection to a large local government may bereallocated by such local government to theState in which such local government is located.‘‘(C) LARGE LOCAL GOVERNMENT.—Forpurposes of this section, the term ‘large localgovernment’ means any municipality or countyif such municipality or county has a populationof 100,000 or more.‘‘(3) ALLOCATION TO ISSUERS; RESTRICTIONBONDS.—Any allocationON PRIVATE ACTIVITYunder this subsection to a State or large local government shall be allocated by such State or largelocal government to issuers within the State in amanner that results in not less than 70 percent ofthe allocation to such State or large local government being used to designate bonds which are notprivate activity bonds.‘‘(f) QUALIFIED CONSERVATION PURPOSE.—Forpurposes of this section—S.L.C.‘‘(1) IN GENERAL.—The term ‘qualified conservation purpose’ means any of the following:‘‘(A) Capital expenditures incurred forpurposes of—‘‘(i) reducing energy consumption inpublicly-owned buildings by at least 20percent,‘‘(ii) implementing green communityprograms,‘‘(iii) rural development involving theproduction of electricity from renewableenergy resources, or‘‘(iv) any qualified facility (as determined under section 45(d) without regardto paragraphs (8) and (10) thereof andwithout regard to any placed in servicedate).‘‘(B) Expenditures with respect to researchfacilities, and research grants, to support research in—‘‘(i) development of cellulosic ethanolor other nonfossil fuels,‘‘(ii) technologies for the capture andsequestration of carbon dioxide producedthrough the use of fossil fuels,S.L.C.‘‘(iii) increasing the efficiency of existing technologies for producing nonfossilfuels,‘‘(iv) automobile battery technologiesand other technologies to reduce fossil fuelconsumption in transportation, or‘‘(v) technologies to reduce energy usein buildings.‘‘(C) Mass commuting facilities and relatedfacilities that reduce the consumption of energy,including expenditures to reduce pollution fromvehicles used for mass commuting.‘‘(D) Demonstration projects designed topromote the commercialization of—‘‘(i) green building technology,‘‘(ii) conversion of agricultural wastefor use in the production of fuel or otherwise,‘‘(iii) advanced battery manufacturingtechnologies,‘‘(iv) technologies to reduce peak useof electricity, or‘‘(v) technologies for the capture andsequestration of carbon dioxide emittedS.L.C.from combusting fossil fuels in order toproduce electricity.‘‘(E) Public education campaigns to promote energy efficiency.‘‘(2) SPECIAL RULES FOR PRIVATE ACTIVITYBONDS.—For purposes of this section, in the case ofany private activity bond, the term ‘qualified conservation purposes’ shall not include any expenditurewhich is not a capital expenditure.‘‘(g) POPULATION.—‘‘(1) IN GENERAL.—The population of anyState or local government shall be determined forpurposes of this section as provided in section 146(j)for the calendar year which includes the date of theenactment of this section.‘‘(2) SPECIAL RULE FOR COUNTIES.—In determining the population of any county for purposes ofthis section, any population of such county which istaken into account in determining the population ofany municipality which is a large local governmentshall not be taken into account in determining thepopulation of such county.‘‘(h) APPLICATION INDIAN TRIBAL GOVERN TOMENTS.—An Indian tribal government shall be treated forS.L.C.purposes of this section in the same manner as a largelocal government, except that—‘‘(1) an Indian tribal government shall be treated for purposes of subsection (e) as located withina State to the extent of so much of the populationof such government as resides within such State,and‘‘(2) any bond issued by an Indian tribal government shall be treated as a qualified energy conservation bond only if issued as part of an issue theavailable project proceeds of which are used for purposes for which such Indian tribal government couldissue bonds to which section 103(a) applies.’’.(b) CONFORMING AMENDMENTS.—(1) Paragraph (1) of section 54A(d), as amended by this Act, is amended to read as follows:‘‘(1) QUALIFIED TAX CREDIT BOND.—The term‘qualified tax credit bond’ means—‘‘(A) a qualified forestry conservationbond,‘‘(B) a new clean renewable energy bond,or‘‘(C) a qualified energy conservation bond,which is part of an issue that meets requirements ofparagraphs (2), (3), (4), (5), and (6).’’.S.L.C.(2) Subparagraph (C) of section 54A(d)(2), asamended by this Act, is amended to read as follows:‘‘(C) QUALIFIED PURPOSE.—For purposesof this paragraph, the term ‘qualified purpose’means—‘‘(i) in the case of a qualified forestryconservation bond, a purpose specified insection 54B(e),‘‘(ii) in the case of a new clean renewable energy bond, a purpose specified insection 54C(a)(1), and‘‘(iii) in the case of a qualified energyconservation bond, a purpose specified insection 54D(a)(1).’’.(3) The table of sections for subpart I of partIV of subchapter A of chapter 1, as amended by thisAct, is amended by adding at the end the followingnew item:‘‘Sec. 54D. Qualified energy conservation bonds.’’.(c) EFFECTIVE DATE.—The amendments made bythis section shall apply to obligations issued after the dateof the enactment of this Act.SEC. 302. CREDIT FOR NONBUSINESS ENERGY PROPERTY.(a) EXTENSION CREDIT.—Section 25C(g) isOFamended by striking ‘‘placed in service after December 31,2007’’ and inserting ‘‘placed in service—S.L.C.‘‘(1) after December 31, 2007, and before January 1, 2009, or‘‘(2) after December 31, 2009.’’.(b) QUALIFIED BIOMASS FUEL PROPERTY.—(1) IN GENERAL.—Section 25C(d)(3) is amended—(A) by striking ‘‘and’’ at the end of subparagraph (D),(B) by striking the period at the end ofsubparagraph (E) and inserting ‘‘, and’’, and(C) by adding at the end the following newsubparagraph:‘‘(F) a stove which uses the burning of biomass fuel to heat a dwelling unit located in theUnited States and used as a residence by thetaxpayer, or to heat water for use in such adwelling unit, and which has a thermal efficiency rating of at least 75 percent.’’.(2) BIOMASS FUEL.—Section 25C(d) is amended by adding at the end the following new paragraph:‘‘(6) BIOMASS FUEL.—The term ‘biomass fuel’means any plant-derived fuel available on a renewable or recurring basis, including agricultural cropsand trees, wood and wood waste and residues (inO:\AYO\AYO08C32.xml S.L.C.cluding wood pellets), plants (including aquaticplants), grasses, residues, and fibers.’’.(c) MODIFICATION WATER HEATER REQUIRE OFMENTS.—Section 25C(d)(3)(E) is amended by inserting‘‘or a thermal efficiency of at least 90 percent’’ after‘‘0.80’’.(d) COORDINATION WITH CREDIT QUALIFIEDFORGEOTHERMAL HEAT PROPERTY EXPENDITURES.—PUMP(1) IN GENERAL.—Paragraph (3) of section25C(d), as amended by subsections (b) and (c), isamended by striking subparagraph (C) and by redesignating subparagraphs (D), (E), and (F) as subparagraphs (C), (D), and (E), respectively.(2) CONFORMING AMENDMENT.—Subparagraph(C) of section 25C(d)(2) is amended to read as follows:‘‘(C) REQUIREMENTS AND STANDARDSFOR AIR CONDITIONERS AND HEAT PUMPS.—The standards and requirements prescribed bythe Secretary under subparagraph (B) with respect to the energy efficiency ratio (EER) forcentral air conditioners and electric heatpumps—‘‘(i) shall require measurements to bebased on published data which is tested byS.L.C.manufacturers at 95 degrees Fahrenheit,and‘‘(ii) may be based on the certifieddata of the Air Conditioning and Refrigeration Institute that are prepared in partnership with the Consortium for EnergyEfficiency.’’.(e) MODIFICATION QUALIFIED ENERGY EFFI OFCIENCY IMPROVEMENTS.—(1) IN GENERAL.—Paragraph (1) of section25C(c) is amended by inserting ‘‘, or an asphalt roofwith appropriate cooling granules,’’ before ‘‘whichmeet the Energy Star program requirements’’.(2) BUILDING ENVELOPE COMPONENT.—Subparagraph (D) of section 25C(c)(2) is amended—(A) by inserting ‘‘or asphalt roof’’ after‘‘metal roof’’, and(B) by inserting ‘‘or cooling granules’’after ‘‘pigmented coatings’’.(f) EFFECTIVE DATES.—(1) IN GENERAL.—Except as provided in paragraph (2), the amendments made this section shallapply to expenditures made after December 31,2008.S.L.C.(2) MODIFICATION OF QUALIFIED ENERGY EFFICIENCY IMPROVEMENTS.—The amendments madeby subsection (e) shall apply to property placed inservice after the date of the enactment of this Act.SEC. 303. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.Subsection (h) of section 179D is amended by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31,2013’’.SEC. 304. NEW ENERGY EFFICIENT HOME CREDIT.Subsection (g) of section 45L (relating to termination) is amended by striking ‘‘December 31, 2008’’ andinserting ‘‘December 31, 2009’’.SEC. 305. MODIFICATIONS OF ENERGY EFFICIENT APPLIANCE CREDIT FOR APPLIANCES PRODUCEDAFTER 2007.(a) IN GENERAL.—Subsection (b) of section 45M isamended to read as follows:‘‘(b) APPLICABLE AMOUNT.—For purposes of subsection (a)—‘‘(1) DISHWASHERS.—The applicable amountis—‘‘(A) $45 in the case of a dishwasher whichis manufactured in calendar year 2008 or 2009S.L.C.and which uses no more than 324 kilowatthours per year and 5.8 gallons per cycle, and‘‘(B) $75 in the case of a dishwasherwhich is manufactured in calendar year 2008,2009, or 2010 and which uses no more than307 kilowatt hours per year and 5.0 gallons percycle (5.5 gallons per cycle for dishwashers designed for greater than 12 place settings).‘‘(2) CLOTHES WASHERS.—The applicableamount is—‘‘(A) $75 in the case of a residential toploading clothes washer manufactured in calendar year 2008 which meets or exceeds a 1.72modified energy factor and does not exceed a8.0 water consumption factor,‘‘(B) $125 in the case of a residential toploading clothes washer manufactured in calendar year 2008 or 2009 which meets or exceeds a 1.8 modified energy factor and does notexceed a 7.5 water consumption factor,‘‘(C) $150 in the case of a residential orcommercial clothes washer manufactured in calendar year 2008, 2009, or 2010 which meets orexceeds 2.0 modified energy factor and does notexceed a 6.0 water consumption factor, andS.L.C.‘‘(D) $250 in the case of a residential orcommercial clothes washer manufactured in calendar year 2008, 2009, or 2010 which meets orexceeds 2.2 modified energy factor and does notexceed a 4.5 water consumption factor.‘‘(3) REFRIGERATORS.—The applicable amountis—‘‘(A) $50 in the case of a refrigeratorwhich is manufactured in calendar year 2008,and consumes at least 20 percent but not morethan 22.9 percent less kilowatt hours per yearthan the 2001 energy conservation standards,‘‘(B) $75 in the case of a refrigeratorwhich is manufactured in calendar year 2008 or2009, and consumes at least 23 percent but nomore than 24.9 percent less kilowatt hours peryear than the 2001 energy conservation standards,‘‘(C) $100 in the case of a refrigeratorwhich is manufactured in calendar year 2008,2009, or 2010, and consumes at least 25 percent but not more than 29.9 percent less kilowatt hours per year than the 2001 energy conservation standards, andS.L.C.‘‘(D) $200 in the case of a refrigeratormanufactured in calendar year 2008, 2009, or2010 and which consumes at least 30 percentless energy than the 2001 energy conservationstandards.’’.(b) ELIGIBLE PRODUCTION.—(1) SIMILAR APPLI TREATMENT FOR ALLANCES.—Subsection (c) of section 45M is amended—(A) by striking paragraph (2),(B) by striking ‘‘(1) IN GENERAL’’ and allthat follows through ‘‘the eligible’’ and inserting‘‘The eligible’’,(C) by moving the text of such subsectionin line with the subsection heading, and(D) by redesignating subparagraphs (A)and (B) as paragraphs (1) and (2), respectively,and by moving such paragraphs 2 ems to theleft.(2) MODIFICATION OF BASE PERIOD.—Paragraph (2) of section 45M(c), as amended by paragraph (1), is amended by striking ‘‘3-calendar year’’and inserting ‘‘2-calendar year’’.S.L.C.(c) TYPES ENERGY EFFICIENT APPLIANCES.—OFSubsection (d) of section 45M is amended to read as follows:‘‘(d) TYPES ENERGY EFFICIENT APPLIANCE.—OFFor purposes of this section, the types of energy efficientappliances are—‘‘(1) dishwashers described in subsection (b)(1),‘‘(2) clothes washers described in subsection(b)(2), and‘‘(3) refrigerators described in subsection(b)(3).’’.(d) AGGREGATE CREDIT AMOUNT ALLOWED.—(1) INCREASE IN LIMIT.—Paragraph (1) of section 45M(e) is amended to read as follows:‘‘(1) AGGREGATE CREDIT AMOUNT ALLOWED.—The aggregate amount of credit allowed under subsection (a) with respect to a taxpayer for any taxable year shall not exceed $75,000,000 reduced bythe amount of the credit allowed under subsection(a) to the taxpayer (or any predecessor) for all priortaxable years beginning after December 31, 2007.’’.(2) EXCEPTION FOR CERTAIN REFRIGERATORAND CLOTHES WASHERS.—Paragraph (2) of section45M(e) is amended to read as follows:S.L.C.‘‘(2) AMOUNT ALLOWED FOR CERTAIN REFRIGERATORS AND CLOTHES WASHERS.—Refrigeratorsdescribed in subsection (b)(3)(D) and clothes washers described in subsection (b)(2)(D) shall not betaken into account under paragraph (1).’’.(e) QUALIFIED ENERGY EFFICIENT APPLIANCES.—(1) IN GENERAL.—Paragraph (1) of section45M(f) is amended to read as follows:‘‘(1) QUALIFIED APPLI ENERGY EFFICIENTANCE.—The term ‘qualified energy efficient appliance’ means—‘‘(A) any dishwasher described in subsection (b)(1),‘‘(B) any clothes washer described in subsection (b)(2), and‘‘(C) any refrigerator described in subsection (b)(3).’’.(2) CLOTHES WASHER.—Section 45M(f)(3) isamended by inserting ‘‘commercial’’ before ‘‘residential’’ the second place it appears.(3) TOP-LOADING WASHER.—Sub CLOTHESsection (f) of section 45M is amended by redesignating paragraphs (4), (5), (6), and (7) as paragraphs (5), (6), (7), and (8), respectively, and by inO:\AYO\AYO08C32.xml S.L.C.serting after paragraph (3) the following new paragraph:‘‘(4) TOP-LOADING WASHER.—TheCLOTHESterm ‘top-loading clothes washer’ means a clotheswasher which has the clothes container compartmentaccess located on the top of the machine and whichoperates on a vertical axis.’’.(4) REPLACEMENT OF ENERGY FACTOR.—Section 45M(f)(6), as redesignated by paragraph (3), isamended to read as follows:‘‘(6) MODIFIED ENERGY FACTOR.—The term‘modified energy factor’ means the modified energyfactor established by the Department of Energy forcompliance with the Federal energy conservationstandard.’’.(5) GALLONS PER CYCLE; WATER CONSUMPFACTOR.—Section 45M(f), as amended byTIONparagraph (3), is amended by adding at the end thefollowing:‘‘(9) GALLONS PER CYCLE.—The term ‘gallonsper cycle’ means, with respect to a dishwasher, theamount of water, expressed in gallons, required tocomplete a normal cycle of a dishwasher.‘‘(10) WATER FACTOR.—TheCONSUMPTIONterm ‘water consumption factor’ means, with respectS.L.C.to a clothes washer, the quotient of the total weighted per-cycle water consumption divided by the cubicfoot (or liter) capacity of the clothes washer.’’.(f) EFFECTIVE DATE.—The amendments made bythis section shall apply to appliances produced after December 31, 2007.SEC. 306. ACCELERATED RECOVERY PERIOD FOR DEPRECIATION OF SMART METERS AND SMARTGRID SYSTEMS.(a) IN GENERAL.—Section 168(e)(3)(D) is amendedby striking ‘‘and’’ at the end of clause (i), by striking theperiod at the end of clause (ii) and inserting a comma,and by inserting after clause (ii) the following new clauses:‘‘(iii) any qualified smart electricmeter, and‘‘(iv) any qualified smart electric gridsystem.’’.(b) DEFINITIONS.—Section 168(i) is amended by inserting at the end the following new paragraph:‘‘(18) QUALIFIED SMART ELECTRIC METERS.—‘‘(A) IN GENERAL.—The term ‘qualifiedsmart electric meter’ means any smart electricmeter which—S.L.C.‘‘(i) is placed in service by a taxpayerwho is a supplier of electric energy or aprovider of electric energy services, and‘‘(ii) does not have a class life (determined without regard to subsection (e)) ofless than 16 years.‘‘(B) SMART ELECTRIC METER.—For purposes of subparagraph (A), the term ‘smartelectric meter’ means any time-based meter andrelated communication equipment which is capable of being used by the taxpayer as part ofa system that—‘‘(i) measures and records electricityusage data on a time-differentiated basisin at least 24 separate time segments perday,‘‘(ii) provides for the exchange of information between supplier or provider andthe customer’s electric meter in support oftime-based rates or other forms of demandresponse,‘‘(iii) provides data to such supplier orprovider so that the supplier or providercan provide energy usage information tocustomers electronically, andS.L.C.‘‘(iv) provides net metering.‘‘(19) QUALIFIED SMART ELECTRIC GRID SYSTEMS.—‘‘(A) IN GENERAL.—The term ‘qualifiedsmart electric grid system’ means any smartgrid property which—‘‘(i) is used as part of a system forelectric distribution grid communications,monitoring, and management placed inservice by a taxpayer who is a supplier ofelectric energy or a provider of electric energy services, and‘‘(ii) does not have a class life (determined without regard to subsection (e)) ofless than 16 years.‘‘(B) SMART GRID PROPERTY.—For thepurposes of subparagraph (A), the term ‘smartgrid property’ means electronics and relatedequipment that is capable of—‘‘(i) sensing, collecting, and monitoring data of or from all portions of autility’s electric distribution grid,‘‘(ii) providing real-time, two-waycommunications to monitor or managesuch grid, andS.L.C.‘‘(iii) providing real time analysis ofand event prediction based upon collecteddata that can be used to improve electricdistribution system reliability, quality, andperformance.’’.(c) CONTINUED APPLICATION 150 PERCENT DE OFBALANCE METHOD.—Paragraph (2) of sectionCLINING168(b) is amended by striking ‘‘or’’ at the end of subparagraph (B), by redesignating subparagraph (C) as subparagraph (D), and by inserting after subparagraph (B) thefollowing new subparagraph:‘‘(C) any property (other than property described in paragraph (3)) which is a qualifiedsmart electric meter or qualified smart electricgrid system, or’’.(d) EFFECTIVE DATE.—The amendments made bythis section shall apply to property placed in service afterthe date of the enactment of this Act.SEC. 307. QUALIFIED GREEN BUILDING AND SUSTAINABLEDESIGN PROJECTS.(a) IN GENERAL.—Paragraph (8) of section 142(l)is amended by striking ‘‘September 30, 2009’’ and inserting ‘‘September 30, 2012’’.(b) TREATMENT CURRENT REFUNDINGOFBONDS.—Paragraph (9) of section 142(l) is amended byS.L.C.striking ‘‘October 1, 2009’’ and inserting ‘‘October 1,2012’’.(c) ACCOUNTABILITY.—The second sentence of section 701(d) of the American Jobs Creation Act of 2004is amended by striking ‘‘issuance,’’ and inserting‘‘issuance of the last issue with respect to such project,’’.SEC. 308. SPECIAL DEPRECIATION ALLOWANCE FOR CERTAIN REUSE AND RECYCLING PROPERTY.(a) IN GENERAL.—Section 168 is amended by addingat the end the following new subsection:‘‘(m) SPECIAL ALLOWANCE CERTAIN REUSEFORRECYCLING PROPERTY.—AND‘‘(1) IN GENERAL.—In the case of any qualifiedreuse and recycling property—‘‘(A) the depreciation deduction providedby section 167(a) for the taxable year in whichsuch property is placed in service shall includean allowance equal to 50 percent of the adjusted basis of the qualified reuse and recyclingproperty, and‘‘(B) the adjusted basis of the qualifiedreuse and recycling property shall be reduced bythe amount of such deduction before computingthe amount otherwise allowable as a depreciaO:\AYO\AYO08C32.xml S.L.C.tion deduction under this chapter for such taxable year and any subsequent taxable year.‘‘(2) QUALIFIED REUSE AND RECYCLING PROPERTY.—For purposes of this subsection—‘‘(A) IN GENERAL.—The term ‘qualifiedreuse and recycling property’ means any reuseand recycling property—‘‘(i) to which this section applies,‘‘(ii) which has a useful life of at least5 years,‘‘(iii) the original use of which commences with the taxpayer after August 31,2008, and‘‘(iv) which is—‘‘(I) acquired by purchase (as defined in section 179(d)(2)) by the taxpayer after August 31, 2008, but onlyif no written binding contract for theacquisition was in effect before September 1, 2008, or‘‘(II) acquired by the taxpayerpursuant to a written binding contractwhich was entered into after August31, 2008.‘‘(B) EXCEPTIONS.—S.L.C.‘‘(i) BONUS DEPRECIATION PROPERTY(k).—The term ‘quali UNDER SUBSECTIONfied reuse and recycling property’ shall notinclude any property to which section168(k) applies.‘‘(ii) ALTERNATIVE DEPRECIATIONPROPERTY.—The term ‘qualified reuse andrecycling property’ shall not include anyproperty to which the alternative depreciation system under subsection (g) applies,determined without regard to paragraph(7) of subsection (g) (relating to election tohave system apply).‘‘(iii) ELECTION OUT.—If a taxpayermakes an election under this clause withrespect to any class of property for anytaxable year, this subsection shall notapply to all property in such class placedin service during such taxable year.‘‘(C) SPECIAL SELF-CON RULE FORSTRUCTED PROPERTY.—In the case of a taxpayer manufacturing, constructing, or producing property for the taxpayer’s own use, therequirements of clause (iv) of subparagraph (A)shall be treated as met if the taxpayer beginsS.L.C.manufacturing, constructing, or producing theproperty after August 31, 2008.‘‘(D) DEDUCTION COM ALLOWED INPUTING MINIMUM TAX.—For purposes of determining alternative minimum taxable incomeunder section 55, the deduction under subsection (a) for qualified reuse and recyclingproperty shall be determined under this sectionwithout regard to any adjustment under section56.‘‘(3) DEFINITIONS.—For purposes of this subsection—‘‘(A) REUSE AND RECYCLING PROPERTY.—‘‘(i) IN GENERAL.—The term ‘reuseand recycling property’ means any machinery and equipment (not including buildingsor real estate), along with all appurtenances thereto, including software necessary to operate such equipment, which isused exclusively to collect, distribute, or recycle qualified reuse and recyclable materials.‘‘(ii) EXCLUSION.—Such term doesnot include rolling stock or other equipO:\AYO\AYO08C32.xml S.L.C.ment used to transport reuse and recyclable materials.‘‘(B) QUALIFIED REUSE AND RECYCLABLEMATERIALS.—‘‘(i) IN GENERAL.—The term ‘qualified reuse and recyclable materials’ meansscrap plastic, scrap glass, scrap textiles,scrap rubber, scrap packaging, recoveredfiber, scrap ferrous and nonferrous metals,or electronic scrap generated by an individual or business.‘‘(ii) ELECTRONIC SCRAP.—For purposes of clause (i), the term ‘electronicscrap’ means—‘‘(I) any cathode ray tube, flatpanel screen, or similar video displaydevice with a screen size greater than4 inches measured diagonally, or‘‘(II) any central processing unit.‘‘(C) RECYCLING OR RECYCLE.—The term‘recycling’ or ‘recycle’ means that process (including sorting) by which worn or superfluousmaterials are manufactured or processed intospecification grade commodities that are suitable for use as a replacement or substitute forS.L.C.virgin materials in manufacturing tangible consumer and commercial products, includingpackaging.’’.(b) EFFECTIVE DATE.—The amendment made bythis section shall apply to property placed in service afterAugust 31, 2008.TITLE IV—REVENUEPROVISIONSSEC. 401. LIMITATION OF DEDUCTION FOR INCOME ATTRIBUTABLE TO DOMESTIC PRODUCTION OFOIL, GAS, OR PRIMARY PRODUCTS THEREOF.(a) IN GENERAL.—Section 199(d) is amended by redesignating paragraph (9) as paragraph (10) and by inserting after paragraph (8) the following new paragraph:‘‘(9) SPECIAL RULE FOR TAXPAYERS WITH OILRELATED QUALIFIED PRODUCTION ACTIVITIES INCOME.—‘‘(A) IN GENERAL.—If a taxpayer has oilrelated qualified production activities income forany taxable year beginning after 2009, theamount otherwise allowable as a deductionunder subsection (a) shall be reduced by 3 percent of the least of—S.L.C.‘‘(i) the oil related qualified production activities income of the taxpayer forthe taxable year,‘‘(ii) the qualified production activitiesincome of the taxpayer for the taxableyear, or‘‘(iii) taxable income (determinedwithout regard to this section).‘‘(B) OIL RELATED QUALIFIED PRODUCINCOME.—For purposes ofTION ACTIVITIESthis paragraph, the term ‘oil related qualifiedproduction activities income’ means for any taxable year the qualified production activities income which is attributable to the production,refining, processing, transportation, or distribution of oil, gas, or any primary product thereofduring such taxable year.‘‘(C) PRIMARY PRODUCT.—For purposes ofthis paragraph, the term ‘primary product’ hasthe same meaning as when used in section927(a)(2)(C), as in effect before its repeal.’’.(b) CONFORMING AMENDMENT.—Section 199(d)(2)(relating to application to individuals) is amended bystriking ‘‘subsection (a)(1)(B)’’ and inserting ‘‘subsections(a)(1)(B) and (d)(9)(A)(iii)’’.S.L.C.(c) EFFECTIVE DATE.—The amendments made bythis section shall apply to taxable years beginning afterDecember 31, 2008.SEC. 402. ELIMINATION OF THE DIFFERENT TREATMENTOF FOREIGN OIL AND GAS EXTRACTION INCOME AND FOREIGN OIL RELATED INCOMEFOR PURPOSES OF THE FOREIGN TAX CREDIT.(a) IN GENERAL.—Subsections (a) and (b) of section907 (relating to special rules in case of foreign oil andgas income) are amended to read as follows:‘‘(a) REDUCTION AMOUNT ALLOWED FOREIGNIN ASTAX UNDER SECTION 901.—In applying section 901, theamount of any foreign oil and gas taxes paid or accrued(or deemed to have been paid) during the taxable yearwhich would (but for this subsection) be taken into account for purposes of section 901 shall be reduced by theamount (if any) by which the amount of such taxes exceeds the product of—‘‘(1) the amount of the combined foreign oiland gas income for the taxable year,‘‘(2) multiplied by—‘‘(A) in the case of a corporation, the percentage which is equal to the highest rate of taxspecified under section 11(b), orS.L.C.‘‘(B) in the case of an individual, a fraction the numerator of which is the tax againstwhich the credit under section 901(a) is takenand the denominator of which is the taxpayer’sentire taxable income.‘‘(b) COMBINED FOREIGN OIL GAS INCOME;ANDFOREIGN OIL AND GAS TAXES.—For purposes of this section—‘‘(1) COMBINED FOREIGN OIL AND GAS INCOME.—The term ‘combined foreign oil and gas income’ means, with respect to any taxable year, thesum of—‘‘(A) foreign oil and gas extraction income,and‘‘(B) foreign oil related income.‘‘(2) FOREIGN OIL AND GAS TAXES.—The term‘foreign oil and gas taxes’ means, with respect toany taxable year, the sum of—‘‘(A) oil and gas extraction taxes, and‘‘(B) any income, war profits, and excessprofits taxes paid or accrued (or deemed tohave been paid or accrued under section 902 or960) during the taxable year with respect toforeign oil related income (determined withoutregard to subsection (c)(4)) or loss which wouldS.L.C.be taken into account for purposes of section901 without regard to this section.’’.(b) RECAPTURE FOREIGN OIL GASOF ANDLOSSES.—Paragraph (4) of section 907(c) (relating to recapture of foreign oil and gas extraction losses by recharacterizing later extraction income) is amended to readas follows:‘‘(4) RECAPTURE OF FOREIGN OIL AND GASLOSSES BY RECHARACTERIZING LATER COMBINEDFOREIGN OIL AND GAS INCOME.—‘‘(A) IN GENERAL.—The combined foreignoil and gas income of a taxpayer for a taxableyear (determined without regard to this paragraph) shall be reduced—‘‘(i) first by the amount determinedunder subparagraph (B), and‘‘(ii) then by the amount determinedunder subparagraph (C).The aggregate amount of such reductions shallbe treated as income (from sources without theUnited States) which is not combined foreignoil and gas income.‘‘(B) REDUCTION FOR PRE-2009 FOREIGNLOSSES.—The reductionOIL EXTRACTIONS.L.C.under this paragraph shall be equal to the lesser of—‘‘(i) the foreign oil and gas extractionincome of the taxpayer for the taxable year(determined without regard to this paragraph), or‘‘(ii) the excess of—‘‘(I) the aggregate amount of foreign oil extraction losses for precedingtaxable years beginning after December 31, 1982, and before January 1,2009, over‘‘(II) so much of such aggregateamount as was recharacterized underthis paragraph (as in effect beforeand after the date of the enactment ofthe Energy Improvement and Extension Act of 2008) for preceding taxable years beginning after December31, 1982.‘‘(C) REDUCTION FOR POST-2008 FOREIGNOIL AND GAS LOSSES.—The reduction underthis paragraph shall be equal to the lesser of—‘‘(i) the combined foreign oil and gasincome of the taxpayer for the taxable yearS.L.C.(determined without regard to this paragraph), reduced by an amount equal to thereduction under subparagraph (A) for thetaxable year, or‘‘(ii) the excess of—‘‘(I) the aggregate amount of foreign oil and gas losses for precedingtaxable years beginning after December 31, 2008, over‘‘(II) so much of such aggregateamount as was recharacterized underthis paragraph for preceding taxableyears beginning after December 31,2008.‘‘(D) FOREIGN OIL AND GAS LOSS DEFINED.—‘‘(i) IN GENERAL.—For purposes ofthis paragraph, the term ‘foreign oil andgas loss’ means the amount by which—‘‘(I) the gross income for the taxable year from sources without theUnited States and its possessions(whether or not the taxpayer choosesthe benefits of this subpart for suchtaxable year) taken into account inS.L.C.determining the combined foreign oiland gas income for such year, is exceeded by‘‘(II) the sum of the deductionsproperly apportioned or allocatedthereto.‘‘(ii) NET OPERATING LOSS DEDUCTION NOT TAKEN INTO ACCOUNT.—Forpurposes of clause (i), the net operatingloss deduction allowable for the taxableyear under section 172(a) shall not betaken into account.‘‘(iii) EXPROPRIATION AND CASUALTYLOSSES NOT TAKEN INTO ACCOUNT.—Forpurposes of clause (i), there shall not betaken into account—‘‘(I) any foreign expropriationloss (as defined in section 172(h) (asin effect on the day before the date ofthe enactment of the Revenue Reconciliation Act of 1990)) for the taxable year, or‘‘(II) any loss for the taxableyear which arises from fire, storm,S.L.C.shipwreck, or other casualty, or fromtheft,to the extent such loss is not compensatedfor by insurance or otherwise.‘‘(iv) FOREIGN OIL EXTRACTIONLOSS.—For purposes of subparagraph(B)(ii)(I), foreign oil extraction losses shallbe determined under this paragraph as ineffect on the day before the date of the enactment of the Energy Improvement andExtension Act of 2008.’’.(c) CARRYBACK CARRYOVER DISALLOWEDAND OFCREDITS.—Section 907(f) (relating to carryback and carryover of disallowed credits) is amended—(1) by striking ‘‘oil and gas extraction taxes’’each place it appears and inserting ‘‘foreign oil andgas taxes’’, and(2) by adding at the end the following newparagraph:‘‘(4) TRANSITION RULES FOR PRE-2009 AND2009 DISALLOWED CREDITS.—‘‘(A) PRE-2009 CREDITS.—In the case ofany unused credit year beginning before January 1, 2009, this subsection shall be applied toany unused oil and gas extraction taxes carriedS.L.C.from such unused credit year to a year beginning after December 31, 2008—‘‘(i) by substituting ‘oil and gas extraction taxes’ for ‘foreign oil and gastaxes’ each place it appears in paragraphs(1), (2), and (3), and‘‘(ii) by computing, for purposes ofparagraph (2)(A), the limitation undersubparagraph (A) for the year to whichsuch taxes are carried by substituting ‘foreign oil and gas extraction income’ for ‘foreign oil and gas income’ in subsection (a).‘‘(B) 2009 CREDITS.—In the case of anyunused credit year beginning in 2009, theamendments made to this subsection by the Energy Improvement and Extension Act of 2008shall be treated as being in effect for any preceding year beginning before January 1, 2009,solely for purposes of determining how much ofthe unused foreign oil and gas taxes for suchunused credit year may be deemed paid or accrued in such preceding year.’’.(d) CONFORMING AMENDMENT.—Section 6501(i) isamended by striking ‘‘oil and gas extraction taxes’’ andinserting ‘‘foreign oil and gas taxes’’.S.L.C.(e) EFFECTIVE DATE.—The amendments made bythis section shall apply to taxable years beginning afterDecember 31, 2008.SEC. 403. BROKER REPORTING OF CUSTOMER’S BASIS INSECURITIES TRANSACTIONS.(a) IN GENERAL.—(1) BROKER REPORTING FOR SECURITIESTRANSACTIONS.—Section 6045 is amended by adding at the end the following new subsection:‘‘(g) ADDITIONAL INFORMATION REQUIRED IN THECASE OF SECURITIES TRANSACTIONS, ETC.—‘‘(1) IN GENERAL.—If a broker is otherwise required to make a return under subsection (a) withrespect to the gross proceeds of the sale of a coveredsecurity, the broker shall include in such return theinformation described in paragraph (2).‘‘(2) ADDITIONAL INFORMATION REQUIRED.—‘‘(A) IN GENERAL.—The information required under paragraph (1) to be shown on areturn with respect to a covered security of acustomer shall include the customer’s adjustedbasis in such security and whether any gain orloss with respect to such security is long-termor short-term (within the meaning of section1222).S.L.C.‘‘(B) DETERMINATION OF ADJUSTEDBASIS.—For purposes of subparagraph (A)—‘‘(i) IN GENERAL.—The customer’sadjusted basis shall be determined—‘‘(I) in the case of any security(other than any stock for which an average basis method is permissibleunder section 1012), in accordancewith the first-in first-out method unless the customer notifies the brokerby means of making an adequateidentification of the stock sold ortransferred, and‘‘(II) in the case of any stock forwhich an average basis method is permissible under section 1012, in accordance with the broker’s defaultmethod unless the customer notifiesthe broker that he elects another acceptable method under section 1012with respect to the account in whichsuch stock is held.‘‘(ii) EXCEPTION FOR WASH SALES.—Except as otherwise provided by the Secretary, the customer’s adjusted basis shallS.L.C.be determined without regard to section1091 (relating to loss from wash sales ofstock or securities) unless the transactionsoccur in the same account with respect toidentical securities.‘‘(3) COVERED SECURITY.—For purposes ofthis subsection—‘‘(A) IN GENERAL.—The term ‘covered security’ means any specified security acquired onor after the applicable date if such security—‘‘(i) was acquired through a transaction in the account in which such security is held, or‘‘(ii) was transferred to such accountfrom an account in which such securitywas a covered security, but only if thebroker received a statement under section6045A with respect to the transfer.‘‘(B) SPECIFIED SECURITY.—The term‘specified security’ means—‘‘(i) any share of stock in a corporation,‘‘(ii) any note, bond, debenture, orother evidence of indebtedness,S.L.C.‘‘(iii) any commodity, or contract orderivative with respect to such commodity,if the Secretary determines that adjustedbasis reporting is appropriate for purposesof this subsection, and‘‘(iv) any other financial instrumentwith respect to which the Secretary determines that adjusted basis reporting is appropriate for purposes of this subsection.‘‘(C) APPLICABLE DATE.—The term ‘applicable date’ means—‘‘(i) January 1, 2011, in the case ofany specified security which is stock in acorporation (other than any stock described in clause (ii)),‘‘(ii) January 1, 2012, in the case ofany stock for which an average basis method is permissible under section 1012, and‘‘(iii) January 1, 2013, or such laterdate determined by the Secretary in thecase of any other specified security.