H.R. 1631 (109th): Rail Infrastructure Development and Expansion Act for the 21st Century

109th Congress, 2005–2006. Text as of Feb 03, 2006 (Reported by House Committee).

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HR 1631 RH

Union Calendar No. 201

109th CONGRESS

2d Session

H. R. 1631

[Report No. 109-314, Parts I and II]

To provide for the financing of high-speed rail infrastructure, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

April 14, 2005

Mr. YOUNG of Alaska (for himself, Mr. OBERSTAR, Mr. LATOURETTE, and Ms. CORRINE BROWN of Florida) introduced the following bill; which was referred to the Committee on Transportation and Infrastructure, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

November 18, 2005

Reported from the Committee on Transportation and Infrastructure

November 18, 2005

Referral to the Committee on Ways and Means extended for a period ending not later than December 31, 2005

December 31, 2005

Referral to the Committee on Ways and Means extended for a period ending not later than February 3, 2006

February 3, 2006

Additional sponsors: Mr. SIMMONS, Ms. NORTON, Ms. MILLENDER-MCDONALD, Mr. BISHOP of New York, Mr. WEINER, Mr. BOSWELL, Mr. BLUMENAUER, Mr. CHANDLER, Ms. CARSON, Mr. KUHL of New York, Mr. PLATTS, Mr. WELLER, Mr. GERLACH, Mr. NEY, Mr. MCHUGH, Mr. DAVIS of Illinois, Mr. HOLT, Mr. HONDA, Ms. MCCOLLUM of Minnesota, Mr. ABERCROMBIE, Mr. RAHALL, Ms. BALDWIN, Mr. REYES, Mr. ISRAEL, Mr. RUPPERSBERGER, Mr. BRADY of Pennsylvania, Mr. HINCHEY, Mr. DEFAZIO, Mrs. JONES of Ohio, Mr. PAYNE, Mr. GRIJALVA, Mr. LEWIS of Georgia, Mr. CARNAHAN, Mrs. MCCARTHY, Mr. CUELLAR, Mr. MENENDEZ, Mr. LIPINSKI, Mr. MCNULTY, Mr. MATSUI, Ms. BERKLEY, Ms. WOOLSEY, Mr. ENGEL, Mr. BACA, Mr. ACKERMAN, Mr. LANTOS, Mr. RANGEL, Mr. PASTOR, Mr. MORAN of Virginia, Mr. EVANS, Mr. DOYLE, Mr. MCGOVERN, Mr. KILDEE, Mr. LOBIONDO, Mr. POMEROY, Mr. BROWN of Ohio, Mr. MCINTYRE, Mr. PALLONE, Mr. LYNCH, Mr. BOUCHER, Mr. MICHAUD, Mr. MILLER of North Carolina, Mr. GUTIERREZ, Mr. SCHWARZ of Michigan, Mr. FILNER, Mr. BUTTERFIELD, Mr. WEXLER, Mr. LARSEN of Washington, Mr. CUMMINGS, Ms. LINDA T. SANCHEZ of California, and Mr. Costa

February 3, 2006

Reported from the Committee on Ways and Means with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed

[Omit the part struck through and insert the part printed in italic]


A BILL

To provide for the financing of high-speed rail infrastructure, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the `Rail Infrastructure Development and Expansion Act for the 21st Century'.

[Struck out->] SEC. 2. HIGH-SPEED INTERCITY RAIL FACILITY BONDS. [<-Struck out]

    [Struck out->] (a) Amendment- Chapter 261 of title 49, United States Code, is amended by adding at the end the following new section: [<-Struck out]

[Struck out->] `Sec. 26106. High-speed rail infrastructure bonds [<-Struck out]

    [Struck out->] `(a) Designation- The Secretary may designate bonds for purposes of subsection (f) or section 54 of the Internal Revenue Code of 1986 if-- [<-Struck out]

      [Struck out->] `(1) the bonds are to be issued by-- [<-Struck out]

        [Struck out->] `(A) a State, if the entire railroad passenger transportation corridor containing the infrastructure project to be financed is within the State; [<-Struck out]

        [Struck out->] `(B) 1 or more of the States that have entered into an agreement or an interstate compact consented to by Congress under section 410(a) of Public Law 105-134 (49 U.S.C 24101 nt); or [<-Struck out]

        [Struck out->] `(C) an agreement or an interstate compact described in subparagraph (B); [<-Struck out]

      [Struck out->] `(2) the bonds are for the purpose of financing-- [<-Struck out]

        [Struck out->] `(A) projects that make a substantial contribution to providing the infrastructure and equipment required to complete a high-speed rail transportation corridor (including projects for the acquisition, financing, or refinancing of equipment and other capital improvements, including the introduction of new high-speed technologies such as magnetic levitation systems, track or signal improvements, the elimination of grade crossings, development of intermodal facilities, improvement of train speeds or safety, or both, and station rehabilitation or construction), but only if the Secretary determines that the projects are part of a viable and comprehensive high-speed rail transportation corridor design for intercity passenger service, including a design for minimally operable segments of a corridor designated under section 104(d)(2) of title 23, United States Code; or [<-Struck out]

        [Struck out->] `(B) projects for the Alaska Railroad; [<-Struck out]

      [Struck out->] `(3) for a railroad passenger transportation corridor design that includes the use of rights-of-way owned by a freight railroad, a written agreement exists between the applicant and the freight railroad regarding such use and ownership, including compensation for such use and assurances regarding the adequacy of infrastructure capacity to accommodate both existing and future freight and passenger operations, and including an assurance by the freight railroad that collective bargaining agreements with the freight railroad's employees (including terms regulating the contracting of work) shall remain in full force and effect according to their terms for work performed by the freight railroad on such railroad passenger transportation corridor; [<-Struck out]

      [Struck out->] `(4) the corridor design eliminates existing railway-highway grade crossings that the Secretary determines would impede high-speed rail operations; [<-Struck out]

      [Struck out->] `(5) the applicant agrees to comply with-- [<-Struck out]

        [Struck out->] `(A) the standards of section 24312, as in effect on September 1, 2002, with respect to the project in the same manner that the National Railroad Passenger Corporation is required to comply with such standards for construction work financed under an agreement made under section 24308(a); and [<-Struck out]

        [Struck out->] `(B) the protective arrangements established under section 504 of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 836) with respect to employees affected by actions taken in connection with the project to be financed by the bond; and [<-Struck out]

      [Struck out->] `(6) the applicant agrees not to pay the principal or interest on the bonds using funds derived directly or indirectly from the Highway Trust Fund, except as permitted by law as of the date of the enactment of this section. [<-Struck out]

    [Struck out->] `(b) Bond Amount Limitation- [<-Struck out]

      [Struck out->] `(1) IN GENERAL- The amount of bonds designated under this section may not exceed-- [<-Struck out]

        [Struck out->] `(A) in the case of subsection (f) bonds, $1,200,000,000 for each of the fiscal years 2006 through 2015; and [<-Struck out]

        [Struck out->] `(B) in the case of section 54 bonds, $1,200,000,000 for each of the fiscal years 2006 through 2015. [<-Struck out]

      [Struck out->] `(2) CARRYOVER OF UNUSED LIMITATION- If for any fiscal year the limitation amount under subparagraph (A) or (B) of paragraph (1) exceeds-- [<-Struck out]

        [Struck out->] `(A) with respect to subparagraph (A) of paragraph (1), the amount of subsection (f) bonds issued during such year; or [<-Struck out]

        [Struck out->] `(B) with respect to subparagraph (B) of paragraph (1), the amount of section 54 bonds issued during such year, [<-Struck out]

      [Struck out->] the limitation amount under subparagraph (A) or (B) of paragraph (1), as the case may be, for the following fiscal year (through fiscal year 2019) shall be increased by the amount of such excess. [<-Struck out]

    [Struck out->] `(c) Preference- The Secretary shall give preference to the designation under this section of bonds for projects-- [<-Struck out]

      [Struck out->] `(1) to be funded through a combination of subsection (f) bonds and section 54 bonds; [<-Struck out]

      [Struck out->] `(2) which propose to link rail passenger service with other modes of transportation; [<-Struck out]

      [Struck out->] `(3) expected to have a significant impact on air traffic congestion; [<-Struck out]

      [Struck out->] `(4) expected to also improve commuter rail operations; [<-Struck out]

      [Struck out->] `(5) where all environmental work has already been completed and the project is ready to commence; or [<-Struck out]

      [Struck out->] `(6) that have received financial commitments and other support of State and local governments. [<-Struck out]

    [Struck out->] `(d) Timely Disposition of Application- The Secretary shall grant or deny a requested designation within 9 months after receipt of an application. [<-Struck out]

    [Struck out->] `(e) Annual Reports- [<-Struck out]

      [Struck out->] `(1) FROM ISSUER OF BONDS- The issuer of bonds designated under subsection (a) shall report annually to the Secretary regarding the terms of outstanding designated bonds and the progress made with respect to the project financed by the bonds. [<-Struck out]

      [Struck out->] `(2) FROM SECRETARY- The Secretary, in consultation with the Secretary of the Treasury, shall transmit to the Congress an annual report which includes-- [<-Struck out]

        [Struck out->] `(A) reports received under paragraph (1); and [<-Struck out]

        [Struck out->] `(B) an assessment of the progress made toward completion of high-speed rail transportation corridors resulting from projects financed by bonds designated under subsection (a). [<-Struck out]

    [Struck out->] `(f) Tax Treatment of Subsection (f) Bonds- [<-Struck out]

      [Struck out->] `(1) EXCLUSION FROM GROSS INCOME- The interest on a bond designated by the Secretary under subsection (a) for purposes of this subsection shall be excluded from gross income under section 103 of the Internal Revenue Code of 1986, notwithstanding section 149(c) of such Code. [<-Struck out]

      [Struck out->] `(2) EXEMPTION FROM VOLUME CAP- For purposes of section 146 of such Code, a bond designated by the Secretary under subsection (a) for purposes of this subsection shall be considered to be exempt from the volume cap of the issuing authority in the same manner as bonds listed in subsection (g) of such section 146. [<-Struck out]

    [Struck out->] `(g) Refinancing Rules- Bonds designated by the Secretary under subsection (a) may be issued for refinancing projects only if the indebtedness being refinanced (including any obligation directly or indirectly refinanced by such indebtedness) was originally incurred by the issuer-- [<-Struck out]

      [Struck out->] `(1) after the date of the enactment of this section; [<-Struck out]

      [Struck out->] `(2) for a term of not more than 3 years; [<-Struck out]

      [Struck out->] `(3) to finance projects described in subsection (a)(2); and [<-Struck out]

      [Struck out->] `(4) in anticipation of being refinanced with proceeds of a bond designated under subsection (a). [<-Struck out]

    [Struck out->] `(h) Provisions Regarding High-Speed Rail Service- [<-Struck out]

      [Struck out->] `(1) STATUS AS EMPLOYER OR CARRIER- Any entity providing railroad transportation (within the meaning of section 20102) that begins operations after the date of the enactment of this section and that uses property acquired pursuant to this section (except as provided in subsection (a)(2)(B)), shall be considered an employer for purposes of the Railroad Retirement Act of 1974 (45 U.S.C. 231 et seq.) and considered a carrier for purposes of the Railway Labor Act (45 U.S.C. 151 et seq.). [<-Struck out]

      [Struck out->] `(2) COLLECTIVE BARGAINING AGREEMENT- Any entity providing high-speed intercity passenger railroad transportation (within the meaning of section 20102) that begins operations after the date of enactment of this section on a project funded in whole or in part by bonds designated under subsection (a), and replaces intercity rail passenger service that was provided by another entity as of the date of enactment of this section, shall enter into an agreement with the authorized bargaining agent or agents for employees of the predecessor provider that-- [<-Struck out]

        [Struck out->] `(A) gives each employee of the predecessor provider priority in hiring according to the employee's seniority on the predecessor provider for each position with the replacing entity that is in the employee's craft or class and is available within three years after the termination of the service being replaced; [<-Struck out]

        [Struck out->] `(B) establishes a procedure for notifying such an employee of such positions; [<-Struck out]

        [Struck out->] `(C) establishes a procedure for such an employee to apply for such positions; and [<-Struck out]

        [Struck out->] `(D) establishes rates of pay, rules, and working conditions. [<-Struck out]

      [Struck out->] `(3) IMMEDIATE REPLACEMENT OF EXISTING RAIL PASSENGER SERVICE- [<-Struck out]

        [Struck out->] `(A) NEGOTIATIONS- If the replacement of preexisting intercity rail passenger service occurs concurrent with or within a reasonable amount of time before the commencement of the replacing entity's high-speed rail passenger service, the replacing entity shall give written notice of its plan to replace existing rail passenger service to the authorized collective bargaining agent or agents for the employees of the predecessor provider at least 90 days prior to the date it plans to commence service. Within 5 days after the date of receipt of such written notice, negotiations between the replacing entity and the collective bargaining agent or agents for the employees of the predecessor provider shall commence for the purpose of reaching agreement with respect to all matters set forth in paragraph (2)(A)-(D). The negotiations shall continue for 30 days or until an agreement is reached, whichever is sooner. If at the end of 30 days the parties have not entered into an agreement with respect to all such matters, the unresolved issues shall be submitted for arbitration in accordance with the procedure set forth in subparagraph (B). [<-Struck out]

        [Struck out->] `(B) ARBITRATION- If an agreement has not been entered into with respect to all matters set forth in paragraph (2)(A)-(D) as provided in subparagraph (A) of this paragraph, the parties shall select an arbitrator. If the parties are unable to agree upon the selection of such arbitrator within 5 days, either or both parties shall notify the National Mediation Board, which shall provide a list of seven arbitrators with experience in arbitrating rail labor protection disputes. Within 5 days after such notification, the parties shall alternately strike names from the list until only one name remains, and that person shall serve as the neutral arbitrator. Within 45 days after selection of the arbitrator, the arbitrator shall conduct a hearing on the dispute and shall render a decision with respect to the unresolved issues set forth in paragraph (2)(A)-(D). This decision shall be final, binding, and conclusive upon the parties. The salary and expenses of the arbitrator shall be borne equally by the parties; all other expenses shall be paid by the party incurring them. [<-Struck out]

        [Struck out->] `(C) SERVICE COMMENCEMENT- A replacing entity under this paragraph shall commence service only after an agreement is entered into with respect to the matters set forth in paragraph (2)(A)-(D) or the decision of the arbitrator has been rendered. [<-Struck out]

      [Struck out->] `(4) SUBSEQUENT REPLACEMENT OF EXISTING RAIL PASSENGER SERVICE- If the replacement of existing rail passenger service takes place within 3 years after the replacing entity commences high-speed rail passenger service, the replacing entity and the collective bargaining agent or agents for the employees of the predecessor provider shall enter into an agreement with respect to the matters set forth in paragraph (2)(A)-(D). If the parties have not entered into an agreement with respect to all such matters within 60 days after the date on which the replacing entity replaces the predecessor provider, the parties shall select an arbitrator using the procedures set forth in paragraph (3)(B), who shall, within 20 days after the commencement of the arbitration, conduct a hearing and decide all unresolved issues. This decision shall be final, binding, and conclusive upon the parties. [<-Struck out]

    [Struck out->] `(i) Issuance of Regulations- Not later than 6 months after the date of the enactment of this section, the Secretary shall issue regulations for carrying out this section. [<-Struck out]

    [Struck out->] `(j) Definitions- For purposes of this section-- [<-Struck out]

      [Struck out->] `(1) SUBSECTION (f) BOND- The term `subsection (f) bond' means a bond designated by the Secretary under subsection (a) for purposes of subsection (f). [<-Struck out]

      [Struck out->] `(2) SECTION 54 BOND- The term `section 54 bond' means a bond designated by the Secretary under subsection (a) for purposes of section 54 of the Internal Revenue Code of 1986 (relating to credit to holders of qualified high-speed rail infrastructure bonds).'. [<-Struck out]

    [Struck out->] (b) Table of Sections Amendment- The table of sections of chapter 261 of title 49, United States Code, is amended by adding after the item relating to section 26105 the following new item: [<-Struck out]

      [Struck out->] `26106. High-speed rail infrastructure bonds.'. [<-Struck out]

[Struck out->] SEC. 3. TAX CREDIT TO HOLDERS OF QUALIFIED HIGH-SPEED RAIL INFRASTRUCTURE BONDS. [<-Struck out]

    [Struck out->] (a) In General- Part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to credits against tax) is amended by adding at the end the following new subpart: [<-Struck out]

[Struck out->] `Subpart H--Nonrefundable Credit for Holders of Qualified High-Speed Rail Infrastructure Bonds [<-Struck out]

      [Struck out->] `Sec. 54. Credit to holders of qualified high-speed rail infrastructure bonds. [<-Struck out]

[Struck out->] `SEC. 54. CREDIT TO HOLDERS OF QUALIFIED HIGH-SPEED RAIL INFRASTRUCTURE BONDS. [<-Struck out]

    [Struck out->] `(a) Allowance of Credit- In the case of a taxpayer who holds a qualified high-speed rail infrastructure bond on a credit allowance date of such bond which occurs during the taxable year, there shall be allowed as a credit against the tax imposed by this chapter for such taxable year an amount equal to the sum of the credits determined under subsection (b) with respect to credit allowance dates during such year on which the taxpayer holds such bond. [<-Struck out]

    [Struck out->] `(b) Amount of Credit- [<-Struck out]

      [Struck out->] `(1) IN GENERAL- The amount of the credit determined under this subsection with respect to any credit allowance date for a qualified high-speed rail infrastructure bond is 25 percent of the annual credit determined with respect to such bond. [<-Struck out]

      [Struck out->] `(2) ANNUAL CREDIT- The annual credit determined with respect to any qualified high-speed rail infrastructure bond is the product of-- [<-Struck out]

        [Struck out->] `(A) the applicable credit rate, multiplied by [<-Struck out]

        [Struck out->] `(B) the outstanding face amount of the bond. [<-Struck out]

      [Struck out->] `(3) APPLICABLE CREDIT RATE- For purposes of paragraph (2), the applicable credit rate with respect to an issue is the rate equal to an average market yield (as of the day before the date of sale of the issue) on outstanding long-term corporate debt obligations (determined under regulations prescribed by the Secretary). [<-Struck out]

      [Struck out->] `(4) CREDIT ALLOWANCE DATE- For purposes of this section, the term `credit allowance date' means-- [<-Struck out]

        [Struck out->] `(A) March 15, [<-Struck out]

        [Struck out->] `(B) June 15, [<-Struck out]

        [Struck out->] `(C) September 15, and [<-Struck out]

        [Struck out->] `(D) December 15. [<-Struck out]

      [Struck out->] Such term includes the last day on which the bond is outstanding. [<-Struck out]

      [Struck out->] `(5) SPECIAL RULE FOR ISSUANCE AND REDEMPTION- In the case of a bond which is issued during the 3-month period ending on a credit allowance date, the amount of the credit determined under this subsection with respect to such credit allowance date shall be a ratable portion of the credit otherwise determined based on the portion of the 3-month period during which the bond is outstanding. A similar rule shall apply when the bond is redeemed. [<-Struck out]

    [Struck out->] `(c) Limitation Based on Amount of Tax- [<-Struck out]

      [Struck out->] `(1) IN GENERAL- The credit allowed under subsection (a) for any taxable year shall not exceed the excess of-- [<-Struck out]

        [Struck out->] `(A) the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over [<-Struck out]

        [Struck out->] `(B) the sum of the credits allowable under this part (other than this subpart and subpart C). [<-Struck out]

      [Struck out->] `(2) CARRYOVER OF UNUSED CREDIT- If the credit allowable under subsection (a) exceeds the limitation imposed by paragraph (1) for such taxable year, such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year. [<-Struck out]

    [Struck out->] `(d) Credit Included in Gross Income- Gross income includes the amount of the credit allowed to the taxpayer under this section (determined without regard to subsection (c)) and the amount so included shall be treated as interest income. [<-Struck out]

    [Struck out->] `(e) Qualified High-Speed Rail Infrastructure Bond- For purposes of this part, the term `qualified high-speed rail infrastructure bond' means any bond issued as part of an issue if-- [<-Struck out]

      [Struck out->] `(1) the issuer certifies that the Secretary of Transportation has designated the bond for purposes of this section under section 26106(a) of title 49, United States Code, as in effect on the date of the enactment of this section, [<-Struck out]

      [Struck out->] `(2) 95 percent or more of the proceeds from the sale of such issue are to be used for expenditures incurred after the date of the enactment of this section for any project described in section 26106(a)(2) of title 49, United States Code, [<-Struck out]

      [Struck out->] `(3) the term of each bond which is part of such issue does not exceed 20 years, [<-Struck out]

      [Struck out->] `(4) the payment of principal with respect to such bond is the obligation solely of the issuer, and [<-Struck out]

      [Struck out->] `(5) the issue meets the requirements of subsection (f) (relating to arbitrage). [<-Struck out]

    [Struck out->] `(f) Special Rules Relating to Arbitrage- [<-Struck out]

      [Struck out->] `(1) IN GENERAL- Subject to paragraph (2), an issue shall be treated as meeting the requirements of this subsection if as of the date of issuance, the issuer reasonably expects-- [<-Struck out]

        [Struck out->] `(A) to spend at least 95 percent of the proceeds from the sale of the issue for 1 or more qualified projects within the 3-year period beginning on such date, [<-Struck out]

        [Struck out->] `(B) to incur a binding commitment with a third party to spend at least 10 percent of the proceeds from the sale of the issue, or to commence construction, with respect to such projects within the 6-month period beginning on such date, and [<-Struck out]

        [Struck out->] `(C) to proceed with due diligence to complete such projects and to spend the proceeds from the sale of the issue. [<-Struck out]

      [Struck out->] `(2) RULES REGARDING CONTINUING COMPLIANCE AFTER 3-YEAR DETERMINATION- If at least 95 percent of the proceeds from the sale of the issue is not expended for 1 or more qualified projects within the 3-year period beginning on the date of issuance, but the requirements of paragraph (1) are otherwise met, an issue shall be treated as continuing to meet the requirements of this subsection if either-- [<-Struck out]

        [Struck out->] `(A) the issuer uses all unspent proceeds from the sale of the issue to redeem bonds of the issue within 90 days after the end of such 3-year period, or [<-Struck out]

        [Struck out->] `(B) the following requirements are met: [<-Struck out]

          [Struck out->] `(i) The issuer spends at least 75 percent of the proceeds from the sale of the issue for 1 or more qualified projects within the 3-year period beginning on the date of issuance. [<-Struck out]

          [Struck out->] `(ii) Either-- [<-Struck out]

            [Struck out->] `(I) the issuer spends at least 95 percent of the proceeds from the sale of the issue for 1 or more qualified projects within the 4-year period beginning on the date of issuance, or [<-Struck out]

            [Struck out->] `(II) the issuer pays to the Federal Government any earnings on the proceeds from the sale of the issue that accrue after the end of the 3-year period beginning on the date of issuance and uses all unspent proceeds from the sale of the issue to redeem bonds of the issue within 90 days after the end of the 4-year period beginning on the date of issuance. [<-Struck out]

    [Struck out->] `(g) Recapture of Portion of Credit Where Cessation of Compliance- [<-Struck out]

      [Struck out->] `(1) IN GENERAL- If any bond which when issued purported to be a qualified high-speed rail infrastructure bond ceases to be such a qualified bond, the issuer shall pay to the United States (at the time required by the Secretary) an amount equal to the sum of-- [<-Struck out]

        [Struck out->] `(A) the aggregate of the credits allowable under this section with respect to such bond (determined without regard to subsection (c)) for taxable years ending during the calendar year in which such cessation occurs and the 2 preceding calendar years, and [<-Struck out]

        [Struck out->] `(B) interest at the underpayment rate under section 6621 on the amount determined under subparagraph (A) for each calendar year for the period beginning on the first day of such calendar year. [<-Struck out]

      [Struck out->] `(2) FAILURE TO PAY- If the issuer fails to timely pay the amount required by paragraph (1) with respect to such bond, the tax imposed by this chapter on each holder of any such bond which is part of such issue shall be increased (for the taxable year of the holder in which such cessation occurs) by the aggregate decrease in the credits allowed under this section to such holder for taxable years beginning in such 3 calendar years which would have resulted solely from denying any credit under this section with respect to such issue for such taxable years. [<-Struck out]

      [Struck out->] `(3) SPECIAL RULES- [<-Struck out]

        [Struck out->] `(A) TAX BENEFIT RULE- The tax for the taxable year shall be increased under paragraph (2) only with respect to credits allowed by reason of this section which were used to reduce tax liability. In the case of credits not so used to reduce tax liability, the carryforwards under subsection (c) shall be appropriately adjusted. [<-Struck out]

        [Struck out->] `(B) NO CREDITS AGAINST TAX- Any increase in tax under paragraph (2) shall not be treated as a tax imposed by this chapter for purposes of determining-- [<-Struck out]

          [Struck out->] `(i) the amount of any credit allowable under this part, or [<-Struck out]

          [Struck out->] `(ii) the amount of the tax imposed by section 55. [<-Struck out]

    [Struck out->] `(h) Other Definitions and Special Rules- For purposes of this section-- [<-Struck out]

      [Struck out->] `(1) BOND- The term `bond' includes any obligation. [<-Struck out]

      [Struck out->] `(2) QUALIFIED PROJECT- The term `qualified project' means any project described in section 26106(a)(2) of title 49, United States Code. [<-Struck out]

      [Struck out->] `(3) TREATMENT OF CHANGES IN USE- For purposes of subsection (e)(2), the proceeds from the sale of an issue shall not be treated as used for a qualified project to the extent that the issuer takes any action within its control which causes such proceeds not to be used for a qualified project. The Secretary shall prescribe regulations specifying remedial actions that may be taken (including conditions to taking such remedial actions) to prevent an action described in the preceding sentence from causing a bond to fail to be a qualified high-speed rail infrastructure bond. [<-Struck out]

      [Struck out->] `(4) PARTNERSHIP; S CORPORATION; AND OTHER PASS-THRU ENTITIES- Under regulations prescribed by the Secretary, in the case of a partnership, trust, S corporation, or other pass-thru entity, rules similar to the rules of section 41(g) shall apply with respect to the credit allowable under subsection (a). [<-Struck out]

      [Struck out->] `(5) BONDS HELD BY REGULATED INVESTMENT COMPANIES- If any qualified high-speed rail infrastructure bond is held by a regulated investment company, the credit determined under subsection (a) shall be allowed to shareholders of such company under procedures prescribed by the Secretary. [<-Struck out]

      [Struck out->] `(6) REPORTING- Issuers of qualified high-speed rail infrastructure bonds shall submit reports similar to the reports required under section 149(e).'. [<-Struck out]

    [Struck out->] (b) Amendments to Other Code Sections- [<-Struck out]

      [Struck out->] (1) REPORTING- Subsection (d) of section 6049 of the Internal Revenue Code of 1986 (relating to returns regarding payments of interest) is amended by adding at the end the following new paragraph: [<-Struck out]

      [Struck out->] `(8) REPORTING OF CREDIT ON QUALIFIED HIGH-SPEED RAIL INFRASTRUCTURE BONDS- [<-Struck out]

        [Struck out->] `(A) IN GENERAL- For purposes of subsection (a), the term `interest' includes amounts includible in gross income under section 54(d) and such amounts shall be treated as paid on the credit allowance date (as defined in section 54(b)(4)). [<-Struck out]

        [Struck out->] `(B) REPORTING TO CORPORATIONS, ETC- Except as otherwise provided in regulations, in the case of any interest described in subparagraph (A), subsection (b)(4) shall be applied without regard to subparagraphs (A), (H), (I), (J), (K), and (L)(i) of such subsection. [<-Struck out]

        [Struck out->] `(C) REGULATORY AUTHORITY- The Secretary may prescribe such regulations as are necessary or appropriate to carry out the purposes of this paragraph, including regulations which require more frequent or more detailed reporting.'. [<-Struck out]

      [Struck out->] (2) TREATMENT FOR ESTIMATED TAX PURPOSES- [<-Struck out]

        [Struck out->] (A) INDIVIDUAL- Section 6654 of such Code (relating to failure by individual to pay estimated income tax) is amended by redesignating subsection (m) as subsection (n) and by inserting after subsection (l) the following new subsection: [<-Struck out]

    [Struck out->] `(m) Special Rule for Holders of Qualified High-Speed Rail Infrastructure Bonds- For purposes of this section, the credit allowed by section 54 to a taxpayer by reason of holding a qualified high-speed rail infrastructure bond on a credit allowance date shall be treated as if it were a payment of estimated tax made by the taxpayer on such date.'. [<-Struck out]

        [Struck out->] (B) CORPORATE- Section 6655 of such Code (relating to failure by corporation to pay estimated income tax) is amended by adding at the end of subsection (g) the following new paragraph: [<-Struck out]

      [Struck out->] `(5) SPECIAL RULE FOR HOLDERS OF QUALIFIED HIGH-SPEED RAIL INFRASTRUCTURE BONDS- For purposes of this section, the credit allowed by section 54 to a taxpayer by reason of holding a qualified high-speed rail infrastructure bond on a credit allowance date shall be treated as if it were a payment of estimated tax made by the taxpayer on such date.'. [<-Struck out]

    [Struck out->] (c) Clerical Amendments- [<-Struck out]

      [Struck out->] (1) The table of subparts for part IV of subchapter A of chapter 1 is amended by adding at the end the following new item: [<-Struck out]

[Struck out->] `SUBPART H. NONREFUNDABLE CREDIT FOR HOLDERS OF QUALIFIED HIGH-SPEED RAIL INFRASTRUCTURE BONDS'. [<-Struck out]

      [Struck out->] (2) Section 6401(b)(1) is amended by striking `and G' and inserting `G, and H'. [<-Struck out]

    [Struck out->] (d) Issuance of Regulations- Not later than 6 months after the date of the enactment of this section, the Secretary of the Treasury shall issue regulations for carrying out this section and the amendments made by this section. [<-Struck out]

    [Struck out->] (e) High-Speed Intercity Rail Facilities- [<-Struck out]

      [Struck out->] (1) REQUIREMENT TO MEET TITLE 49 REQUIREMENTS- Section 142(i) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph: [<-Struck out]

      [Struck out->] `(4) ADDITIONAL REQUIREMENTS- A bond issued as part of an issue described in subsection (a)(11) shall not be considered an exempt facility bond unless the requirements of paragraphs (1) through (6) of section 26106(a) of title 49, United States Code, are met.'. [<-Struck out]

      [Struck out->] (2) REVISION OF SPEED REQUIREMENT- Section 142(i)(1) of such Code is amended by striking `150 miles per hour' and inserting `110 miles per hour'. [<-Struck out]

    [Struck out->] (f) Effective Date- The amendments made by this section shall apply to obligations issued after the date of the enactment of this Act. [<-Struck out]

SEC. [Struck out->] 4. [<-Struck out] 2. HIGH-SPEED RAIL CORRIDOR DEVELOPMENT.

    (a) Corridor Development-

      (1) AMENDMENTS- Section 26101 of title 49, United States Code, is amended--

        (A) in the section heading, by striking `planning' and inserting `development';

        (B) in the heading of subsection (a), by striking `Planning' and inserting `Development';

        (C) by striking `corridor planning' each place it appears and inserting `corridor development';

        (D) in subsection (b)(1)--

          (i) by inserting `, or if it is an activity described in subparagraph (M)' after `high-speed rail improvements';

          (ii) by striking `and' at the end of subparagraph (K);

          (iii) by striking the period at the end of subparagraph (L) and inserting `; and'; and

          (iv) by adding at the end the following new subparagraph:

      `(M) the acquisition of locomotives, rolling stock, track, and signal equipment.'; and

        (E) in subsection (c)(2), by striking `planning' and inserting `development'.

      (2) CONFORMING AMENDMENT- The item relating to section 26101 in the table of sections of chapter 261 of title 49, United States Code, is amended by striking `planning' and inserting `development'.

    (b) Authorization of Appropriations- Section 26104 of title 49, United States Code, is amended to read as follows:

`Sec. 26104. Authorization of appropriations

    `(a) Fiscal Years 2006 Through 2013- There are authorized to be appropriated to the Secretary--

      `(1) $70,000,000 for carrying out section 26101; and

      `(2) $30,000,000 for carrying out section 26102,

    for each of the fiscal years 2006 through 2013.

    `(b) Funds to Remain Available- Funds made available under this section shall remain available until expended.'.

SEC. [Struck out->] 5. [<-Struck out] 3. REHABILITATION AND IMPROVEMENT FINANCING.

    (a) Definitions- Section 102(7) of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 802(7)) is amended to read as follows:

      `(7) `railroad' has the meaning given that term in section 20102 of title 49, United States Code; and'.

    (b) General Authority- Section 502(a) of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(a)) is amended by striking `Secretary may provide direct loans and loan guarantees to State and local governments,' and inserting `Secretary shall provide direct loans and loan guarantees to State and local governments, agreements or interstate compacts consented to by Congress under section 410(a) of Public Law 105-134 (49 U.S.C 24101 nt),'.

    (c) Extent of Authority- Section 502(d) of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(d)) is amended--

      (1) by striking `$3,500,000,000' and inserting `$35,000,000,000';

      (2) by striking `$1,000,000,000' and inserting `$7,000,000,000'; and

      (3) by adding at the end the following new sentence: `The Secretary shall not establish any limit on the proportion of the unused amount authorized under this subsection that may be used for 1 loan or loan guarantee.'.

    (d) Cohorts of Loans- Section 502(f) of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(f)) is amended--

      (1) in paragraph (2)--

        (A) by striking `and' at the end of subparagraph (D);

        (B) by redesignating subparagraph (E) as subparagraph (F); and

        (C) by adding after subparagraph (D) the following new subparagraph:

        `(E) the size and characteristics of the cohort of which the loan or loan guarantee is a member; and'; and

      (2) by adding at the end of paragraph (4) the following: `A cohort may include loans and loan guarantees. The Secretary shall not establish any limit on the proportion of a cohort that may be used for 1 loan or loan guarantee.'.

    (e) Conditions of Assistance- Section 502 of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822) is amended--

      (1) in subsection (f)(2)(A), by inserting `, if any' after `collateral offered'; and

      (2) by adding at the end of subsection (h) the following:

    `The Secretary shall not require an applicant for a direct loan or loan guarantee under this section to provide collateral. The Secretary shall not require that an applicant for a direct loan or loan guarantee under this section have previously sought the financial assistance requested from another source. The Secretary shall require recipients of direct loans or loan guarantees under this section to apply the standards of section 26106(a)(5) of title 49, United States Code, to their projects.'.

    (f) Time Limit for Approval or Disapproval- Section 502 of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822) is amended by adding at the end the following new subsection:

    `(i) Time Limit for Approval or Disapproval- Not later than 90 days after receiving a complete application for a direct loan or loan guarantee under this section, the Secretary shall approve or disapprove the application.'.

    (g) Fees and Charges- Section 503 of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 823) is amended by adding at the end the following new subsection:

    `(l) Fees and Charges- Except as provided in this title, the Secretary may not assess any fees, including user fees, or charges in connection with a direct loan or loan guarantee provided under section 502.'.

    (h) Substantive Criteria and Standards- Not later than 30 days after the date of the enactment of this Act, the Secretary of Transportation shall publish in the Federal Register and post on the Department of Transportation web site the substantive criteria and standards used by the Secretary to determine whether to approve or disapprove applications submitted under section 502 of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822).

Union Calendar No. 201

109th CONGRESS

2d Session

H. R. 1631

[Report No. 109-314, Parts I and II]

A BILL

To provide for the financing of high-speed rail infrastructure, and for other purposes.


February 3, 2006

Reported from the Committee on Ways and Means with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed