HR 115 IH
106th CONGRESS
1st Session
H. R. 115
To facilitate efficient investments and financing of infrastructure
projects and new job creation through the establishment of a National
Infrastructure Development Corporation, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
January 6, 1999
Ms. DELAURO (for herself, Mr. GEPHARDT, Mr. BONIOR, Mr. FROST, Ms. PELOSI,
Mr. BORSKI, Mr. WISE, and Mr. THOMPSON of Mississippi) introduced the following
bill; which was referred to the Committee on Transportation and Infrastructure,
and in addition to the Committees on Banking and Financial Services, and 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.
A BILL
To facilitate efficient investments and financing of infrastructure
projects and new job creation through the establishment of a National
Infrastructure Development Corporation, 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 `National Infrastructure Development Act of
1999'.
SEC. 2. FINDINGS.
Congress hereby finds the following:
(1) As expressed in Executive Order No. 12893 of January 26, 1994, which
sets out guiding principles for Federal infrastructure investments, a well
functioning infrastructure is vital to sustained economic growth, to the
quality of life of our communities, and to the protection of our environment
and natural resources.
(2) Although grant programs of the Federal Government must continue to
play a central role in financing the infrastructure needs of the Nation,
current and foreseeable demands on existing Federal, State, and local
funding for infrastructure expansion and replacement exceed the resources to
support these programs by margins wide enough to prompt serious concerns
about the Nation's ability to sustain long-term economic development,
productivity, and international competitiveness.
(3) Increased investments by public and private capital in
infrastructure facilities the financing for which can be based on the
revenue generated by such facilities and by other dedicated revenue sources
would assist the Nation in marshalling the resources necessary to meet
existing and projected infrastructure funding demands.
(4) The private capital markets, including the more than
$4,500,000,000,000 dollars in capital held by institutional investors such
as pension funds, have a growing interest in public-private infrastructure
investment opportunities that can produce competitive risk-adjusted rates of
return.
(5) Federal leadership is necessary to expeditiously develop these new
infrastructure investment mechanisms.
(6) Such leadership can best be accomplished by the establishment of a
self-supporting national entity designed to lead the way in promoting
appropriate public-private infrastructure partnerships and by the creation
of a public benefit bond designed to facilitate investment by pension plans
in infrastructure development.
(7) Such a national entity will provide for significant and sustained
job growth in critical sectors of the Nation's economy as it helps address
unmet infrastructure needs by leveraging limited Federal resources with
private capital.
SEC. 3. PURPOSES.
The purposes of this Act are as follows:
(1) To establish the National Infrastructure Development Corporation for
the purpose of making new sources of financing available for the development
of infrastructure facilities, and to facilitate the use and issuance of
public benefit bonds.
(2) To establish a subsidiary of the Corporation, the National
Infrastructure Insurance Corporation, to issue insurance, reinsurance and
related undertakings in respect of the issuance of obligations related to
the development of infrastructure facilities.
(3) To establish a category of financial instrument to be known as
`public benefit bonds' designed to help facilitate pension plan investment
in the development of infrastructure facilities.
SEC. 4. DEFINITIONS.
The following definitions shall apply for purposes of this Act unless the
context requires otherwise:
(1) CORPORATION- The term `Corporation' means the National
Infrastructure Development Corporation established under section 5(a).
(2) DEVELOPMENT- The terms `development' and `develop' mean, with
respect to an infrastructure facility, any--
(A) preconstruction planning, feasibility review, permitting and
design work and other preconstruction activities;
(B) construction, reconstruction, rehabilitation, replacement, or
expansion; and
(C) operation and maintenance.
(3) ENTITY- The term `entity' means an individual, corporation,
partnership, joint venture, trust or governmental entity or
instrumentality.
(4) INFRASTRUCTURE FACILITY- The term `infrastructure facility' means a
road, highway, bridge, tunnel, airport, mass transportation vehicle or
system, passenger or freight rail vehicle or system, intermodal
transportation facility, waterway, commercial port, drinking or waste water
treatment facility, solid waste disposal facility, pollution control system,
hazardous waste facility, federally designated national information highway
facility, school, and any ancillary facility which forms a part of any such
facility or is reasonably related to such facility, whether owned, leased or
operated by a public entity or a private entity or by a combination of such
entities, and the financing or refinancing of the development of which is,
or will be, supported in whole or in part by user fees or other dedicated
revenue sources.
(5) INSURANCE CORPORATION- The term `Insurance Corporation' means the
National Infrastructure Insurance Corporation established pursuant to
section 5(b).
(6) NIC- The term `NIC' means the Corporation and all subsidiaries of
the Corporation.
(7) PENSION PLAN- The term `pension plan' means a pension plan as
defined in section 3(2) of the Employee Retirement Income Security Act of
1974, including any public pension plan.
(8) PUBLIC BENEFIT BOND- The term `public benefit bond' means a bond or
other indebtedness meeting the requirements of section 72(w) of the Internal
Revenue Code of 1986.
(9) PUBLIC-PRIVATE PARTNERSHIP- The term `public-private partnership'
means any entity--
(A) which is undertaking the development of all or part of any
infrastructure facility--
(i) pursuant to requirements established in 1 or more contracts
between such entity and a State or an instrumentality of a State;
or
(ii) the activities of which with respect to such facility are
subject to regulation by a State or any instrumentality of a State;
and
(B) which owns, leases, or operates, or will own, lease, or operate,
such infrastructure facility in whole or in part, and at least 1 of the
participants in such entity is a nongovernmental entity.
(10) REVOLVING FUND- The term `revolving fund' means a fund or program
established by a State or a political subdivision or instrumentality of a
State, the principal activity of which is to make loans, commitments, or
other financial accommodation available for the development of 1 or more
categories of infrastructure facilities.
(11) SECRETARY- The term `Secretary' means the Secretary of the Treasury
or the designee of the Secretary.
(12) STATE- The term `State' includes the District of Columbia, Puerto
Rico, Guam, American Samoa, the Trust Territories of the Pacific Islands,
the Virgin Islands, the Northern Mariana Islands, and any territory of the
United States.
(13) TRANSITION DATE- The term `transition date' means the date on which
the voting common stock of the Corporation owned by the Secretary is fully
repurchased or converted in accordance with section 13 and the transition of
the Corporation to
a government-sponsored enterprise in accordance with such section is
completed.
SEC. 5. ESTABLISHMENT OF NIC.
(a) ESTABLISHMENT OF NATIONAL INFRASTRUCTURE DEVELOPMENT CORPORATION- The
National Infrastructure Development Corporation is hereby established as a
wholly owned Government corporation subject to chapter 91 of title 31
(commonly referred to as the Government Corporation Control Act), except as
otherwise provided in this Act.
(b) ESTABLISHMENT OF NATIONAL INFRASTRUCTURE INSURANCE CORPORATION- The
National Infrastructure Insurance Corporation is hereby established as a
subsidiary of the Corporation and as a wholly owned Government corporation
subject to chapter 91 of title 31, except as otherwise provided in this
Act.
(c) SELF-SUPPORTING ENTITIES- The Corporation and the Insurance
Corporation shall each conduct their respective businesses as self-supporting
entities.
SEC. 6. CORPORATION'S POWERS AND LIMITATIONS.
(a) GENERAL POWERS- In order to carry out the purposes of the Corporation
as set forth in this Act, the Corporation shall have the following powers:
(1) To make senior and subordinated loans and purchase senior and
subordinated debt securities (both taxable and tax exempt) and equity
securities, and enter into a binding commitment to make any such loan or
purchase any such security, on such terms as the Corporation may determine,
in the Corporation's discretion, to be appropriate, the proceeds of which
are to be used to finance or refinance the development of 1 or more
infrastructure facilities, and subject to the provisions of paragraph (8) of
subsection (b), provide preconstruction phase assistance in accordance with
section 8(f).
(2) To issue and sell debt securities and voting and nonvoting equity
securities of the Corporation on such terms as the board of directors of the
Corporation may determine, subject to the provisions of paragraphs (2), (3),
and (4) of subsection (b), to be appropriate and to pay such dividends on
any outstanding stock as the board of directors shall determine from time to
time.
(3) To make the determinations with respect to public benefit bonds
pursuant to section 72(w) of the Internal Revenue Code of 1986.
(4) To make agreements and contracts with any entity in furtherance of
the business of the Corporation.
(5) To make use of the services, facilities, and property of any Federal
agency or instrumentality, with the approval of such agency or
instrumentality and on a reimbursable basis, in carrying out the purposes of
this Act.
(6) To acquire, lease, pledge, exchange, and dispose of real and
personal property and otherwise exercise all the usual incidents of
ownership of property to the extent the exercise of such powers are
appropriate to and consistent with the purposes of the Corporation.
(7) To sue and be sued in the Corporation's corporate capacity in any
court of competent jurisdiction, except that no attachment, injunction, or
similar process, mesne or final, may be issued against the property of the
Corporation or against the Corporation with respect to such property.
(8) To indemnify the directors and officers of the Corporation for
liabilities arising out of the actions of the directors and officers in such
capacity, in accordance with, and subject to the limitations contained in,
the bylaws of the Corporation.
(9) To exercise all other lawful powers which are necessary or
appropriate to carry out, and are consistent with, the purposes of the
Corporation, including the powers conferred upon a corporation by the
District of Columbia Business Corporation Act.
(b) LIMITATIONS ON THE CORPORATION-
(1) ACTIONS CONSISTENT WITH SELF-SUPPORTING ENTITY STATUS- The
Corporation shall conduct its business in a manner consistent with the
requirement of section 5(c).
(2) CONDITION ON DEBT ISSUANCE- The Corporation shall not issue any debt
security under subsection (a)(2) unless, at the time of the issuance
thereof, such security is rated by a nationally recognized statistical
rating organization at 1 of the 3 highest ratings of such
organization.
(3) LIMITATION AND CONDITION ON ISSUANCE OF DEBT AND NONVOTING EQUITY
SECURITIES-
(A) IN GENERAL- Before the transition date, the Corporation shall not
issue any debt security or nonvoting equity security under
subsection
(a)(2) without the prior consent of the Secretary.
(B) APPROVAL OF SECRETARY FOR DEBT SECURITY AFTER TRANSITION DATE- On
and after the transition date, the Corporation shall not issue any debt
security under subsection (a)(2) without the prior consent of the
Secretary.
(4) CONDITION ON VOTING EQUITY ISSUANCE- Before the transition date, the
Corporation shall not issue any voting security to any entity other than the
Secretary, and, on and after the transition date, the issuance of any such
security shall be subject to the provisions of section 13.
(5) SALE OF VOTING SECURITIES OF THE INSURANCE CORPORATION- Before the
transition date, voting securities of the Insurance Corporation purchased by
the Corporation may not be sold or otherwise transferred by the
Corporation.
(6) INVESTMENTS CONSISTENT WITH PURPOSES OF CORPORATION- In order to
achieve the Corporation's purpose of effectively leveraging limited Federal
resources with other public and private sources of capital, the Corporation
shall seek to maintain a significant proportion of the Corporation's
infrastructure investments in--
(A) subordinated securities; and
(B) securities issued with respect to infrastructure facilities
developed by public-private partnerships.
(7) COORDINATION WITH STATE AND LOCAL REGULATORY AUTHORITY- The
provision of financial assistance by the Corporation pursuant to this Act
shall not be construed as--
(A) limiting the right of any State or local authority to approve or
regulate rates of return on private equity invested in a project;
or
(B) otherwise superseding any State law or regulation applicable to a
project.
(8) LIMITATION ON PRECONSTRUCTION ASSISTANCE- The Corporation shall
provide assistance in connection with the development of any infrastructure
facility during the facility's preconstruction phase only in accordance with
section 8(f).
SEC. 7. INSURANCE CORPORATION'S POWERS AND LIMITATIONS.
(a) GENERAL POWERS- In order to carry out the purposes of the Insurance
Corporation as set forth in this Act, the Insurance Corporation shall have the
following powers:
(1) To insure and reinsure bonds, debentures, notes, debt instruments,
loans, and any interest in any such obligation or loan, the proceeds of
which are to be used to finance or refinance the development of 1 or more
infrastructure facilities.
(2) To insure leases of personal, real, or mixed property with respect
to infrastructure facilities.
(3) To issue letters of credit and undertake such obligations and
commitments as the Insurance Corporation deems necessary to carry out the
purposes described in paragraphs (1) and (2).
(4) To issue and sell voting and nonvoting equity securities on such
terms as the board of directors of the Insurance Corporation may determine,
subject to the provisions of paragraphs (5) and (6) of subsection (b), to be
appropriate and to pay dividends on any outstanding stock as the board of
directors of the Insurance Corporation shall determine from time to
time.
(5) To make agreements and contracts with any entity in furtherance of
the business of the Insurance Corporation.
(6) To make use of the services, facilities, and property of any Federal
agency or instrumentality, with the approval of such agency or
instrumentality and on a reimbursable basis, in carrying out the purposes of
this Act.
(7) To acquire, lease, pledge, exchange, and dispose of real and
personal property and otherwise exercise all the usual incidents of
ownership of property to the extent the exercise of such powers are
appropriate to and consistent with the purposes of the Insurance
Corporation.
(8) To sue and be sued in the Insurance Corporation's corporate capacity
in any court of competent jurisdiction, except that no attachment,
injunction, or similar process, mesne or final, may be issued against the
property of the Insurance Corporation or against the Insurance Corporation
with respect to such property.
(9) To indemnify the directors and officers of the Insurance Corporation
for liabilities arising out of the actions of the directors and officers in
such capacity, in accordance with, and subject to the limitations contained
in, the bylaws of the Insurance Corporation.
(10) To exercise all other lawful powers which are necessary or
appropriate to carry out, and are consistent with, the purposes of the
Insurance Corporation, including the powers conferred upon a corporation by
the District of Columbia Business Corporation Act.
(b) LIMITATIONS ON THE INSURANCE CORPORATION-
(1) ACTIONS CONSISTENT WITH SELF-SUPPORTING ENTITY STATUS- The Insurance
Corporation shall conduct its business in a manner consistent with the
requirement of section 5(c).
(2) INSURANCE CORPORATION RATING REQUIREMENT- The Insurance Corporation
shall not issue any primary insurance or letter of credit with respect to 1
or more infrastructure facilities unless, at the time of such issuance, the
Insurance Corporation's claims-paying ability is then rated by a nationally
recognized statistical rating organization at the highest rating of such
organization.
(3) LIMITATION ON REINSURANCE- The Insurance Corporation may write
reinsurance in respect of all or a portion of a primary insurance policy
with respect to 1 or more infrastructure facilities issued by a bond insurer
if the claims-paying ability of such insurer is rated, at the time of
issuance of such reinsurance, by a nationally recognized statistical rating
organization at the highest rating of such organization.
(4) LIMITATION ON INSURANCE AND OTHER ACTIVITIES- The Insurance
Corporation may issue primary insurance or a letter of credit with respect
to 1 or more infrastructure facilities, except that not
less than 75 percent of the principal amount of all obligations so insured or
subject of a letter of credit shall be obligations which are, or based on a
published or indicative rating would be, without such insurance or letter of
credit, rated by a nationally recognized statistical rating organization in the
fourth or fifth rating categories of such organization (BBB and BB; Baa and Ba,
or their equivalents).
(5) PRIOR CONSENT OF SECRETARY- Before the transition date, the
Insurance Corporation shall not issue any nonvoting equity security under
subsection (a)(4) without the prior consent of the Secretary.
(6) CONDITION ON VOTING EQUITY ISSUANCE- Before the transition date, the
Insurance Corporation shall not issue any voting security to any entity
other than the Corporation.
(7) COORDINATION WITH STATE AND LOCAL REGULATORY AUTHORITY- The
provision of financial assistance by the Insurance Corporation pursuant to
this Act shall not be construed as--
(A) limiting the right of any State or local authority to approve or
regulate rates of return on private equity invested in a project;
or
(B) otherwise superseding any State law or regulation applicable to a
project.
SEC. 8. ELIGIBILITY CRITERIA FOR ASSISTANCE FROM THE CORPORATION AND THE
INSURANCE CORPORATION.
(a) GENERAL- No financial assistance shall be available under this Act
from the Corporation or the Insurance Corporation unless the applicant for
such assistance has demonstrated to the satisfaction of the Corporation or the
Insurance Corporation, as the case may be, that the project for which such
assistance is being sought meets--
(1) the requirements of this Act; and
(2) any criteria established in accordance with this Act by the board of
directors of the Corporation or the Insurance Corporation, as the case may
be.
(b) ESTABLISHMENT OF PROJECT CRITERIA-
(1) IN GENERAL- Consistent with the requirements of subsections (c) and
(d), the boards of directors of the Corporation and the Insurance
Corporation shall each establish--
(A) criteria for determining eligibility for financial assistance
under this Act;
(B) disclosure and application procedures to be followed by States,
revolving funds, and other entities to nominate projects for assistance
under this Act; and
(C) such other criteria as the board of directors of the Corporation
or the Insurance Corporation may consider to be appropriate for purposes
of carrying out this Act.
(2) FACTORS TO BE TAKEN INTO ACCOUNT- The criteria established pursuant
to paragraph (1)(A) shall provide for the consideration of the following
factors in considering eligibility for financial assistance under this
Act:
(A) The extent to which provision of assistance by the Corporation or
the Insurance Corporation will further the objectives for infrastructure
investments established in Executive Order No. 12893 of January 26, 1994,
including the stated objective of providing opportunities for `innovative
public-private initiatives'.
(B) The means by which development of the infrastructure facility
under consideration is being financed, including--
(i) the terms and conditions and financial structure of the proposed
financing;
(ii) the financial assumptions and projections on which the project
is based; and
(iii) based on consideration of clauses (i) and (ii), whether the
infrastructure facility will have the capacity to be
self-supporting.
(C) The likelihood that the provision of assistance by the Corporation
or the Insurance Corporation will cause such development to proceed more
promptly and with lower costs for financing to the public and private
entities engaged in developing such infrastructure facility than would be
the case without such assistance.
(D) The extent to which the provision of assistance by the Corporation
or the Insurance Corporation maximizes the level of private investment in
such infrastructure facility.
(3) LIMITATION ON CONDITIONS- The Corporation and the Insurance
Corporation shall not condition the approval of financial assistance for the
development of any infrastructure facility on a requirement that a pension
plan of a State or political subdivision of a State make an investment in
such facility.
(c) SUBMISSION OF PROJECT PROPOSALS-
(1) ACCEPTANCE OF PROPOSALS- The Corporation and the Insurance
Corporation shall accept, for consideration, project proposals relating to
the development of infrastructure facilities submitted by a State, a
revolving fund, or another entity, subject to subsection (d), which meet the
requirements of subsection (b).
(2) LIST OF PROJECTS UNDER CONSIDERATION FOR ASSISTANCE- Project
proposals accepted pursuant to paragraph (1) and approved in principle shall
be placed on a list of projects being considered for financial assistance
under this Act.
(3) ELIGIBILITY FOR PRECONSTRUCTION ASSISTANCE- Projects on the list
established pursuant to paragraph (2) shall be eligible to apply for
preconstruction assistance in accordance with subsection (f).
(4) SUBSEQUENT APPROVALS- Notwithstanding the receipt of any
preconstruction assistance for any project, no additional financial
assistance under this Act for such project may be provided without the
specific approval by the Corporation or the Insurance Corporation, as the
case may be, for such additional assistance.
(5) FEES- A fee may be charged for the review of any project proposal in
such amount as may be deemed appropriate by the Corporation or the Insurance
Corporation to cover the cost of such review.
(1) IN GENERAL- After the end of the 3-year period beginning on the date
of the enactment of this Act, no financial assistance may be provided by the
Corporation or the Insurance Corporation for the development of any
infrastructure facility proposed for assistance by a State, or a revolving
fund in a State, unless such State has in place--
(A) an evaluation process which is certified by the Secretary, in
accordance with regulations which the Secretary shall prescribe before the
end of the 6-month period beginning on such date of enactment, as being
designed to ascertain the extent to which major work with respect to
infrastructure facilities within the State can be financed by relying on
any revenue reasonably obtainable from such facilities and other dedicated
revenue sources; and
(B) a program which is certified by the Secretary, in accordance with
regulations which the Secretary shall prescribe before the end of
such 6-month period, as being reasonably designed to promote the objective
set forth in Executive Order No. 12893 of January 26, 1994, of affording the
opportunity for innovative public-private initiatives with respect to major
work, consistent with the public interest.
(2) ACTIVITIES WITH NONSTATE ENTITIES- After the end of the 3-year
period beginning on the date of the enactment of this Act, the Corporation
and the Insurance Corporation each may continue to undertake activities with
respect to projects within a State relating to the development of
infrastructure facilities which have been submitted by entities other than
such State or a revolving fund in such State, including municipalities,
regional authorities, and private-public partnerships, if the infrastructure
facilities meet the criteria for assistance established pursuant to
subsection (b), and the State or States in which such facility or facilities
are to be located have not met the conditions of subsection (d)(1).
(3) MAJOR WORK DEFINED- For purposes of paragraph (1), the term `major
work' means the construction of a new infrastructure facility, or the
reconstruction, rehabilitation, replacement, or expansion of an existing
infrastructure facility, involving the expenditure of more than
$10,000,000.
(e) INITIAL TARGETING OF READY-TO-GO PROJECTS- During the 3-year period
beginning on the date of the enactment of this Act, the Corporation and the
Insurance Corporation shall each seek to provide assistance to projects
involving the development of infrastructure facilities which--
(1) the Corporation or the Insurance Corporation, as the case may be,
determines are ready to move forward promptly; and
(2) meet all other requirements of this Act.
(f) DEVELOPMENT RISK INSURANCE-
(1) IN GENERAL- Any project on the list established pursuant to
subsection (c)(2) shall be eligible to apply to the Corporation for
development risk insurance in accordance with this subsection to insure
against the risk of loss that would result if a project does not proceed
within a specified time frame as the result of the failure to secure
relevant permits or specified Federal, State, or local approvals.
(2) TERMS AND SCOPE OF COVERAGE- Development risk insurance provided
under this subsection shall--
(A) contain such limitations, deductibles, exclusions, and exceptions
as the Corporation shall establish; and
(B) apply only to developmental costs incurred after the date of the
approval of the application for such insurance.
(3) MAXIMUM ON INSURANCE OF PRECONSTRUCTION RISK- The Corporation shall
not insure more than 50 percent of the preconstruction phase development
risk of any project, as determined by the Corporation.
(4) ADDITIONAL CONDITIONS- The Corporation may impose such other
conditions and requirements in connection with any insurance provided under
this subsection as the Corporation may determine to be appropriate,
including requirements for audits of costs and other matters.
(5) FEES FOR INSURANCE- The Corporation may charge such fees and obtain
such other compensation for providing insurance coverage under this
subsection as the Corporation, in the Corporation's discretion, shall
determine to be appropriate.
(6) MAXIMUM EXPOSURE OF CORPORATION- The total outstanding exposure of
the Corporation with respect to insurance provided under this subsection may
not exceed the amount which is equal to 5 percent of the sum of the capital,
surplus, and retained earnings of the Corporation, as measured at the time
any such insurance is provided.
(g) DISCRETION OF CORPORATION AND INSURANCE CORPORATION- Consistent with
other provisions of this Act, any determination of the Corporation or the
Insurance Corporation to provide assistance to any project, and the manner in
which such assistance is provided, including the terms, conditions, fees and
charges in respect thereof, shall be at the sole discretion of the Corporation
or the Insurance Corporation, as the case may be.
(h) INDEPENDENT INVESTMENT COMMITTEE- Any final decision to provide or not
provide assistance under this Act by the Corporation or the Insurance
Corporation with respect to any specific proposal shall be made by an
investment committee, of the respective corporation, which shall be comprised
of senior officers of the Corporation and the Insurance Corporation, as the
case may be, appointed to such committee by the respective board of directors,
which committees shall not have any nonofficer director members.
(i) STATE AND LOCAL PERMITS REQUIRED- The provision of assistance by the
Corporation or the Insurance Corporation in accordance with this section shall
not
be deemed to relieve any recipient of assistance or the related project of
any obligation to obtain required State and local permits and approvals.
(j) ANNUAL REPORT- A State, revolving fund, or other entity receiving
assistance from the Corporation or the Insurance Corporation shall make annual
reports to the Corporation or the Insurance Corporation, as the case may be,
on the use of any such assistance, compliance with the criteria set forth in
this section, and a disclosure of all entities with a development, ownership,
or operational interest in a project assisted or proposed to be assisted
pursuant to this Act.
SEC. 9. CAPITALIZATION AND ORGANIZATION OF THE CORPORATION AND THE INSURANCE
CORPORATION.
(1) CAPITALIZATION OF THE CORPORATION-
(A) VOTING COMMON STOCK- Effective for any fiscal year only to such
extent and in such amounts as are provided in advance in appropriation
Acts, the Secretary shall subscribe for and purchase, in each of the 3
years following the date of enactment of this Act, voting common stock of
the Corporation having an aggregate purchase price in each year of
$1,000,000,000, except that no such purchase shall occur after the
transition date.
(B) LIMITATION ON SALE OF SECURITIES BY SECRETARY- Securities
purchased by the Secretary may not be sold or otherwise transferred by the
Secretary unless such sale or transfer is effected pursuant to section 13
or is explicitly authorized by an Act of Congress.
(2) CAPITALIZATION OF THE INSURANCE CORPORATION-
(A) IN GENERAL- The Corporation may subscribe for and purchase voting
common stock of the Insurance Corporation in such amounts and at such
times as the board of directors of the Corporation shall from time to time
consider appropriate.
(B) LIMITATION ON INVESTMENT BY CORPORATION- Not more than 25 percent
of the capital, surplus, and retained earnings of the Corporation may be
invested by the Corporation in the Insurance Corporation without the
consent of the Secretary, measured at the time of any such
investment.
(3) REPURCHASE OF OUTSTANDING OBLIGATIONS- The Corporation and the
Insurance Corporation may purchase in the open market any of their
respective outstanding obligations at any time and at any price.
(b) PLACE OF BUSINESS AND GOVERNING LAW-
(A) PRINCIPAL OFFICE- The Corporation shall maintain its principal
office in the District of Columbia, and shall be deemed, for purposes of
venue in civil actions, to be a resident of the District of
Columbia.
(B) APPLICABILITY OF DISTRICT OF COLUMBIA BUSINESS CORPORATION ACT- To
the extent not inconsistent with this Act, the Corporation shall be
subject to the District of Columbia Business Corporation Act.
(2) INSURANCE CORPORATION-
(A) PLACE OF BUSINESS- The Insurance Corporation shall maintain its
principal office in the District of Columbia, and shall be deemed, for
purposes of venue in civil actions, to be a resident thereof.
(B) APPLICABILITY OF DISTRICT OF COLUMBIA BUSINESS CORPORATION ACT- To
the extent not inconsistent with this Act, the Insurance Corporation shall
be subject to the District of Columbia Business Corporation Act.
(3) APPLICABILITY OF STATE INSURANCE LAWS- Before the transition date,
the Corporation and the Insurance Corporation shall not be subject to the
provisions of the law of any State or political subdivision of any State
regulating the ownership or conduct of an insurance or surety business in
any jurisdiction.
(4) EXEMPTION FROM TAXATION-
(A) ON AND BEFORE TRANSITION DATE- On and before the transition date,
the Corporation, the Insurance Corporation, and any other subsidiary of
the Corporation, including the franchise, capital, reserves, surplus,
securities holdings, and income of the Corporation, the Insurance
Corporation, or any such subsidiary shall be exempt from taxation now or
hereafter imposed by the United States, any State, or any county,
municipality, or local taxing authority.
(B) AFTER TRANSITION DATE- After the transition date, the Corporation,
the Insurance Corporation, and any other subsidiary of the Corporation,
including the franchise, capital,
reserves, surplus, securities holdings, and income of the Corporation, the
Insurance Corporation, or any such subsidiary shall be exempt from all taxation
now or hereafter imposed by the United States, any State, or any county,
municipality, or local taxing authority in any State, provided that the
Corporation, the Insurance Corporation and any other subsidiary of the
Corporation shall be subject to Federal income taxation.
SEC. 10. MANAGEMENT OF THE CORPORATION.
(1) NUMBER AND APPOINTMENT- Subject to the provisions of section 13, the
Corporation shall have a board of directors consisting of 12 members, 9 of
whom shall be appointed by the President.
(2) REQUIRED EXPERTISE- The President shall appoint individuals to the
board of directors of the Corporation with a demonstrated experience and
expertise in the general field of infrastructure project development,
finance, or related disciplines.
(3) ADDITIONAL SELECTION CRITERIA- The President shall ensure that, of
the nonofficer directors appointed to the board of directors, a
minimum
of 6 shall be selected from among representatives of the private sector, of
which--
(A) 2 shall be representatives of organized labor; and
(B) 2 shall be individuals involved in the field of public-private
infrastructure finance and related disciplines.
(4) CONSULTATION WITH THE NATIONAL GOVERNORS' CONFERENCE- The President
shall select 2 of the nonofficer directors to be appointed to the board of
directors after consulting with and considering the recommendations of the
National Governors' Conference.
(5) APPOINTMENT OF OFFICERS TO THE BOARD- A majority of the nonofficer
members of the board shall appoint the president of the Corporation who
shall serve on the board of directors. The president of the Corporation
shall select 2 executive officers to be appointed to the board, subject to
confirmation by a majority of the board.
(A) PRESIDENTIAL APPOINTEES- Each director appointed by the President
shall be appointed for a term of 4 years, except as provided in
subparagraph (B).
(B) INITIAL PRESIDENTIAL APPOINTEES- As designated by the President,
of the directors first appointed by the President--
(i) 1/3 shall be appointed for a term of 2 years;
(ii) 1/3 shall be appointed for a term of 3 years; and
(iii) 1/3 shall be appointed for a term of 4 years.
(C) OFFICER DIRECTORS- Officer directors of the Corporation shall
serve for a period of 1 year or until they cease to be an officer of the
Corporation.
(D) INTERIM APPOINTMENTS- Any director appointed to fill a vacancy
occurring before the expiration of the term for which the director's
predecessor was appointed shall be appointed only for the remainder of
that term.
(E) CONTINUATION OF SERVICE- A director may serve after the expiration
of that director's term until a successor has taken office.
(7) VACANCIES- A vacancy in the board of directors shall be filled in
the manner in which the original appointment was made.
(A) PRESIDENTIAL APPOINTEES- Members of the board of directors
appointed by the President may be reappointed by the President, consistent
with the requirements of this section.
(B) OFFICER DIRECTORS- The president of the Corporation shall be
reappointed to the board by the nonofficer directors for so long as such
individual continues to serve as president of the Corporation. Officer
directors of the board selected by the president of the Corporation may be
reappointed by the president of the Corporation, consistent with the
requirements of this section.
(A) PRESIDENTIAL APPOINTEES- A director appointed by the President
shall be subject to removal only for cause.
(B) OFFICER DIRECTORS- Officer directors of the Corporation shall be
subject to removal from the board in the discretion of a majority of the
board, except that the president of the Corporation shall continue to
serve on the board for so long as he or she serves as president of the
Corporation.
(10) QUORUM- 7 directors shall constitute a quorum.
(11) CHAIRPERSON- The chairperson of the board of directors shall be
selected by a majority of the board from among the nonofficer directors of
the board, and shall serve for a period of 1 year, or until a new
chairperson is selected.
(12) STATUS AND COMPENSATION OF BOARD MEMBERS-
(A) NONOFFICER DIRECTORS- Members of the board of directors who are
not officers of the Corporation shall serve on a part-time basis and shall
receive a per diem, when engaged in the actual performance of Corporation
business, plus reasonable reimbursement for travel, subsistence and other
necessary expenses incurred in the performance of their duties.
(B) OFFICER DIRECTORS- Members of the board of directors who are
officers of the Corporation shall not be entitled to receive any salary or
other compensation for services as a director of the Corporation, but may
receive reasonable reimbursement for travel, subsistence and other
necessary expenses incurred in the performance of their duties as
directors of the Corporation.
(13) Conflicts of interest-
(A) IN GENERAL- Nonofficer directors shall have no responsibility for,
and shall not seek to influence, any decision of the independent
investment committee established pursuant to section 8(h).
(B) CONSULTATION- Notwithstanding subparagraph (A), the investment
committee may, in the committee's discretion and on the committee's own
initiative, consult with the board of directors as the committee sees
fit.
(C) LIMITATION ON CONSULTATION- No nonofficer director of the
Corporation who has, or is affiliated with a person who has, an interest
in any project under consideration for assistance under this Act shall
participate in any consultation under subparagraph (B) with respect to
such project.
(14) MEETINGS- The board of directors shall meet at any time pursuant to
the call of the chairperson or a majority of the directors and as provided
by the bylaws of the Corporation, but not less than once each calendar
quarter.
(15) DUTIES- In addition to any duties established under this Act and
the bylaws of the Corporation, the board of directors shall determine the
general policies which shall govern the operations of the Corporation in
accordance with this Act.
(16) DELEGATION OF AUTHORITY- The board of directors may delegate duties
and powers of the board to such committees of the board as the board may
determine to be appropriate.
(b) OFFICERS OF THE CORPORATION-
(1) PRESIDENT OF THE CORPORATION- The president of the Corporation shall
be the chief executive officer of the Corporation, with such executive
functions, powers, and duties as may be prescribed by this Act, the bylaws,
or the board of directors.
(2) APPOINTMENT OF OFFICERS- The president of the Corporation shall,
with the approval of a majority of the board, appoint qualified individuals
to such executive officer positions as may be provided for in the bylaws of
the Corporation, and shall define their duties. The president may appoint,
remove, fix the compensation of, and define the duties of other officers as
provided in the bylaws.
(3) COMPENSATION- The compensation of the president and the executive
officers of the Corporation shall be determined by the board of directors of
the Corporation, in the discretion of the board of directors.
(4) CONFLICTS OF INTEREST- Officers of the Corporation shall not
participate in any review or decision affecting a project under
consideration for assistance under this Act if such officer has, or is
affiliated with a person who has, an interest in such project.
(5) REMOVAL- Any executive officer of the Corporation may be removed in
the discretion of a majority of the board of directors.
SEC. 11. MANAGEMENT OF THE INSURANCE CORPORATION.
(1) NUMBER AND ELECTION- Subject to the provisions of section 13, the
Insurance Corporation shall have a board of directors consisting of 12
members elected by the stockholders of the Insurance Corporation.
(2) INITIAL APPOINTMENT OF DIRECTORS- The initial directors of the
Insurance Corporation shall be appointed by the board of directors of the
Corporation.
(3) REQUIRED EXPERTISE- The board shall be comprised of individuals who
have a demonstrated expertise and experience in the field of credit
enhancement or insurance and related disciplines, a minimum of 9 of whom
shall be selected from among representatives of the private sector.
(A) IN GENERAL- Each director shall be elected or appointed for a term
of 2 years, except as provided in subparagraph (B).
(B) INTERIM APPOINTMENTS- Any director elected or appointed to fill a
vacancy occurring before the expiration of the term for which the
director's predecessor was appointed shall be elected or appointed only
for the remainder of that term.
(C) CONTINUATION OF SERVICE- A director may serve after the expiration
of that director's term until a successor has taken office.
(5) VACANCIES- A vacancy in the board of directors shall be filled in
the manner in which the original appointment was made, except that the
bylaws may provide for the appointment by the board of directors of a
director to fill a vacancy occurring before the expiration of the term for
which the director's predecessor was elected or appointed.
(6) QUORUM- 7 directors shall constitute a quorum.
(A) ELECTION- The chairperson of the board of directors shall be
elected by the board of directors from among the directors on the
board.
(B) TERM- The term of office of the chairperson shall be 1 year or
until a new chairperson is elected.
(8) STATUS AND COMPENSATION OF BOARD MEMBERS- Members of the board of
directors shall serve on a part-time basis and shall receive a per diem,
when engaged in the actual performance of Insurance Corporation business,
plus reasonable reimbursement for travel, subsistence and other necessary
expenses incurred in the performance of their duties.
(9) CONFLICTS OF INTEREST-
(A) IN GENERAL- Nonofficer directors shall have no responsibility for,
and shall not seek to influence, any decision of the independent
investment committee established pursuant to section 8(h).
(B) CONSULTATION- Notwithstanding subparagraph (A), the investment
committee may, in the committee's discretion and on the committee's own
initiative, consult with the board of directors as the committee sees
fit.
(C) LIMITATION ON CONSULTATION- No director who has, or is affiliated
with any person who has, an interest in any project under consideration
for assistance under this Act shall participate in any such consultation
with respect to such project.
(10) MEETINGS- The board of directors shall meet at any time pursuant to
the call of the chairperson or a majority of the directors and as provided
by the bylaws of the Insurance Corporation, but not less than once each
calendar quarter.
(11) DUTIES- In addition to any duties established under this Act or the
bylaws of the Insurance Corporation, the board of directors shall determine
the general policies which shall govern the operations of the Insurance
Corporation in accordance with this Act.
(12) DELEGATION OF AUTHORITY- The board of directors may delegate duties
and powers of the
board to such committees of the board as the board may determine to be
appropriate.
(b) OFFICERS OF THE INSURANCE CORPORATION-
(1) PRESIDENT OF THE INSURANCE CORPORATION- There shall be a position of
president of the Insurance Corporation who shall be the chief executive
officer of the Insurance Corporation, with such executive functions, powers,
and duties as may be prescribed by the bylaws or by the board of
directors.
(2) APPOINTMENT OF OFFICERS- The chairperson of the board of directors
of the Insurance Corporation shall, with the approval of a majority of the
board, appoint a qualified individual to the position of president of the
Insurance Corporation. The president of the Insurance Corporation shall,
with the approval of a majority of the board, appoint qualified individuals
to such executive officer positions as may be provided for in the bylaws of
the Insurance Corporation, and shall define their duties. The president may
appoint, remove, fix the compensation of, and define the duties of other
officers as provided in the bylaws.
(3) COMPENSATION- The compensation of the president and the executive
officers of the Insurance
Corporation shall be determined by the board of directors of the Insurance
Corporation, in the discretion of the board of directors.
(4) CONFLICTS OF INTEREST- Officers of the Insurance Corporation shall
not participate in any review or decision affecting a project under
consideration for assistance under this Act if such officer has, or is
affiliated with a person who has, an interest in such project.
(5) REMOVAL- Any executive officer of the Insurance Corporation may be
removed in the discretion of a majority of the board of directors.
SEC. 12. BOARD OF DIRECTOR MEETINGS OPEN TO PUBLIC.
(a) GENERAL- All meetings of the full board of directors held to conduct
the business of the Corporation or the Insurance Corporation shall be open to
the public, and shall be preceded by reasonable notice.
(b) CLOSED MEETINGS- Pursuant to such rules as the Corporation and the
Insurance Corporation may establish through their bylaws, the respective board
of directors may close a meeting of the board if at the meeting there is
likely to be disclosed information which could adversely affect or lead to
speculation relating to an infrastructure project under consideration for
assistance under this Act, or in financial or securities or commodities
markets or institutions, utilities, or real estate. The determination to close
any meeting of either board of directors shall be made in a meeting of such
board, open to the public, and preceded by reasonable notice. The respective
board of directors shall prepare minutes of any meeting which is closed to the
public and make such minutes available as soon as the considerations
necessitating closing such meeting no longer apply.
SEC. 13. TRANSITION TO GOVERNMENT-SPONSORED ENTERPRISE.
(a) GENERAL- Within 5 years after the date of this Act, the Corporation
shall prepare a strategic plan for the transition of NIC to a
government-sponsored enterprise (as defined in section 3(8) of the
Congressional Budget and Impoundment Control Act of 1974) and for the sale or
transfer to investors other than the Federal Government, as set forth in
subsection (b), of the voting securities of the Corporation. The Corporation
shall revise such transition plan as needed.
(b) PLAN; PENSION PLAN PARTICIPATION-
(1) IN GENERAL- The strategic plan shall include consideration of
alternative means for effecting such transition through a broad distribution
to long-term investors, including by a public offering of stock or
convertible stock or debt.
(2) PENSION PLAN PARTICIPATION- The strategic plan shall include
provisions that specify that the initial purchasers of voting securities of
the Corporation or of nonvoting securities which are convertible to such
voting securities on the transition date (disregarding any underwriters of
such securities) shall be pension plans.
(1) IN GENERAL- The strategic plan may call for a phased transfer of
ownership or for complete transfer at a single point in time.
(2) RULES APPLICABLE IN THE CASE OF A PHASED TRANSITION- If the plan
calls for phased transfer of ownership--
(A) such transition shall be deemed to occur when 100 percent of the
voting securities of the Corporation have been transferred to or are held
by investors other than the Federal Government, and the investment of the
Federal Government in the Corporation has been repaid or converted as
provided in subsection (h);
(B) before the transition date, all equity securities of the
Corporation held by investors other than the Federal Government (or any
equity security into which any other security is convertible) shall be
nonvoting securities; and
(C) on and after the transition date, nonvoting equity securities of
the Corporation held by investors other than the Federal Government (or
into which other securities are convertible) may, in accordance with the
terms of such securities, be converted or become convertible into voting
securities.
(d) REQUIREMENT OF PRESIDENTIAL APPROVAL- The Corporation may not
implement the transition plan without the approval of the President, and shall
seek reapproval if the plan is materially altered.
(e) NOTIFICATION OF CONGRESS-
(1) IN GENERAL- The Corporation shall notify the Congress of--
(A) the Corporation's intent to implement the transition plan;
and
(B) any material alteration of a transition plan previously submitted
to the Congress.
(2) REPORT- Within 30 days of any notification of the Congress under
paragraph (1), the Comptroller General of the United States shall submit a
report to Congress evaluating the extent to which--
(A) the transition plan (as then modified) would result in ongoing
obligations (other than contemplated by subsection (h)) or undue cost to
the Federal Government; and
(B) the cash proceeds (or projected range thereof) to be provided to
the Federal Government, or the securities proposed to be received in
exchange for the investment of the Federal Government in the Corporation
or portion thereof, represents the full recoupment of such investment
(after taking into account any dividends paid to the Federal
Government).
(f) CONGRESSIONAL REVIEW- The Corporation may implement the plan not less
than 60 days after notification of the Congress, if the approval of the
President referred to in subsection (d) has been received.
(g) DEPOSIT OF PROCEEDS- Any cash proceeds receivable by the Federal
Government pursuant to this section shall be deposited in the general fund of
the Treasury.
(h) CONVERSION OF FEDERAL GOVERNMENT INVESTMENT- Upon the implementation
of the transition plan, the voting equity securities of the Corporation held
by the Federal Government or, in the case of a phased transition, that portion
of the voting equity securities which are subject to such phase shall be
repurchased by the Corporation or converted to long-term subordinated debt
securities having a par amount not less than the amounts appropriated pursuant
to section 19 and subject to such phase, or a combination thereof, as
contemplated by such plan.
(A) INITIAL BOARD- Before the end of the 120-day period beginning on
the transition date, a special meeting of the stockholders of the
Corporation shall be held, at which all directors of the Corporation shall
be elected to serve a 1-year term or until any such director's successor
has been elected.
(B) NOMINATION; SELECTION CRITERIA- The candidates for election to the
board of directors under paragraph (1) shall be nominated by the existing
board of directors and 4 of such candidates shall be nominated in
accordance with the selection criteria set out in section
10(a)(3).
(C) SUBSEQUENT BOARDS- After the 1st election of a board of directors
pursuant to subparagraph (A), the directors shall be elected and subject
to removal by the stockholders of the Corporation, as provided in the
District of Columbia Business Corporation Act, except that the nomination
of candidates for each election of the board of directors shall continue
to reflect the requirements of section 10(a)(3).
(2) INSURANCE CORPORATION-
(A) INITIAL BOARD- Promptly following the special meeting of the
stockholders of the Corporation pursuant to paragraph (1), a special
meeting of the stockholders of the Insurance Corporation shall be held, at
which all directors or the Insurance Corporation shall be elected to serve
a 1-year term or until any such director's successor has been
elected.
(B) SUBSEQUENT BOARDS- After the 1st election of a board of directors
pursuant to subparagraph (A), the directors shall be elected and subject
to removal by the stockholders of the Insurance Corporation, as provided
in the District of Columbia Business Corporation Act.
(j) TRANSMITTAL OF FINAL PLAN AFTER COMPLETION- The Corporation shall
transmit copies of the final strategic plan for transition to the President
and the Congress upon completion of such transition.
SEC. 14. STATUS AND APPLICABILITY OF CERTAIN FEDERAL LAWS.
(a) BEFORE THE TRANSITION DATE- Before the transition date, the
Corporation, the Insurance Corporation, and any other subsidiary of the
Corporation, shall--
(1) not be agencies of the United States; and
(2) comply with all Federal laws regulating the budgetary and auditing
practices of a government corporation, except as otherwise provided in this
Act.
(b) SUBSEQUENT TO THE TRANSITION DATE- On and after the transition date,
the Corporation, the Insurance Corporation, and any other subsidiary of the
Corporation shall not be considered to be an agency, instrumentality, or
establishment of the United States Government or a government corporation or a
government-controlled corporation, for purposes of any Federal law, except as
otherwise provided in this Act.
(c) AUTHORIZED INVESTMENTS AND SECURITY- All obligations issued by the
Corporation shall be authorized investments for any person created under the
laws of the United States or any State to the same extent that the person may
hold or invest in obligations issued by or guaranteed as to principal or
interest by the United States or any agency or instrumentality of the United
States.
(d) EFFECT OF AND EXEMPTIONS FROM OTHER LAWS-
(1) EXEMPT SECURITIES- All equity and debt securities and other
obligations issued by the Corporation or the Insurance Corporation pursuant
to this Act shall be deemed to be exempt securities within the meaning of
laws administered by the Securities and Exchange Commission to the same
extent as securities which are direct obligations of, or obligations fully
guaranteed as to principal or interest by, the United States.
(2) OPEN MARKET OPERATIONS AND STATE TAX EXEMPT STATUS- The obligations
of the Corporation shall be deemed to be obligations of the United States
for the purposes of the provision designated as (b)(2) of the 2nd
undesignated paragraph of section 14 of the Federal Reserve Act and section
3124 of title 31, United States Code.
(3) NO PRIORITY AS A FEDERAL CLAIM- The priority established in favor of
the United States by section 3713 of title 31, United States Code, shall not
apply with respect to any indebtedness of the Corporation or the Insurance
Corporation.
(e) FEDERAL RESERVE BANKS AS DEPOSITARIES, CUSTODIANS, AND FISCAL AGENTS-
The Federal reserve banks may act as depositaries for, or custodians or fiscal
agents of, the Corporation and the Insurance Corporation.
(f) ACCESS TO BOOK-ENTRY SYSTEM- The Secretary may authorize the
Corporation and the Insurance Corporation to use the book-entry system of the
Federal reserve system.
SEC. 15. COMPLIANCE WITH DAVIS-BACON ACT.
NIC shall take such action as may be necessary to ensure that projects
assisted in whole or in part under the provisions of this Act shall
incorporate a provision requiring in any contract relating to any
construction, reconstruction, rehabilitation, replacement, or expansion of
such project, that not less than the wages prevailing in the locality, as
predetermined by the Secretary of Labor pursuant to the Act of March 3, 1931
(40 U.S.C. 276a; commonly referred to as the `Davis-Bacon Act') shall be paid
to all laborers and mechanics employed to perform such contracts.
SEC. 16. OBLIGATIONS NOT FEDERALLY GUARANTEED; STATE LAWS.
(a) STATUS OF SECURITIES-
(1) NO FULL FAITH AND CREDIT OF THE U.S- Obligations of the Corporation
or the Insurance Corporation, and obligations insured by any such
corporation shall not be obligations of, or guaranteed as to principal or
interest by, the United
States or any agency of the United States and the obligations shall so
plainly state.
(2) FINANCING NOT TREATED AS U.S. GUARANTEE- The provision of assistance
of any kind or nature from NIC shall not be treated as a direct or indirect
guarantee of any payment of principal or interest on any security by the
United States for purposes of section 149(b) of the Internal Revenue Code of
1986 or any other law.
(b) STATE LAWS- The receipt by any entity of any assistance under this
Act, directly or indirectly, and any financial assistance provided by any
governmental entity in connection with such assistance under this Act shall be
valid and lawful notwithstanding any State or local restrictions regarding
extensions of credit or other benefits to private persons or entities, or
other similar restrictions.
SEC. 17. AUDITS; REPORTS TO THE PRESIDENT AND THE CONGRESS.
(a) ACCOUNTING- The books of account of NIC shall be maintained in
accordance with generally accepted accounting principles and shall be subject
to an annual audit by independent public accountants of nationally recognized
standing.
(b) REPORTS- NIC shall submit to the President and the Congress, within 90
days after the end of each fiscal year, a complete and detailed report with
respect to the preceding fiscal year, setting forth--
(1) a summary of NIC's operations, for such preceding fiscal year;
(2) NIC's financial statements and the opinion with respect thereto
prepared by the independent public accountant reviewing such statements and
a copy of any report made on an audit conducted under subsection (a) of this
section;
(3) a schedule of NIC's obligations and capital securities outstanding
at the end of such fiscal year, with a statement of the amounts issued and
redeemed or paid during such fiscal year; and
(4) the status of projects receiving funding or other assistance
pursuant to this Act, including disclosure of all entities with a
development, ownership, or operational interest in such projects.
(1) IN GENERAL- NIC shall maintain adequate books and records to support
the financial transactions of the Corporation, the Insurance Corporation,
and subsidiaries of such corporations.
(2) AUDITS BY THE SECRETARY AND GAO- The books and records of NIC shall
be maintained in accordance with recommended accounting practices and shall
be open to inspection by the Secretary and the Comptroller General of the
United States.
SEC. 18. TAX TREATMENT OF DISTRIBUTIONS FROM QUALIFIED RETIREMENT PLANS
INVESTING IN PUBLIC BENEFIT BONDS.
(a) IN GENERAL- Section 72 of the Internal Revenue Code of 1986 (relating
to annuities; certain proceeds of endowment and life insurance contracts) is
amended by redesignating subsection (w) as subsection (x) and by inserting
after subsection (v) the following new subsection:
`(w) TREATMENT OF DISTRIBUTION FROM QUALIFIED RETIREMENT PLANS INVESTING
IN PUBLIC BENEFIT BONDS-
`(1) IN GENERAL- In the case of any qualified retirement plan which
receives directly or indirectly any interest on any public benefit bond
(including any payments in respect thereof made by a surety or guarantor)
for purposes of applying this section to any distribution from such plan,
the distributee's investment in the contract shall be treated as including
such distributee's allocable share of such interest under the terms of the
qualified retirement plan, and any such distribution shall be treated as a
distribution described in subsection (e)(2)(B) in which the distribution is
allocable first to the investment in the contract attributable to such
interest.
`(2) TREATMENT OF INSTALLMENTS- In the case of a distribution to be made
over more than one calendar year, the amount of public benefit bond interest
to be taken into account with respect to a given calendar year shall be the
aggregate amount of such interest allocable to the distributee as of the end
of the prior calendar year. With respect to the final calendar year, the
amount of public benefit bond interest to be taken into account shall
include the amount of such interest received by the plan during such year
that is allocable to the plan participant with respect to whom the
distribution is made.
`(3) PUBLIC BENEFIT BOND- For purposes of this subsection, the term
`public benefit bond' means any obligation issued after the date of the
enactment of this subsection if--
`(A) 95 percent or more of the net proceeds of such obligation are
used in connection with the financing or refinancing of 1 or more
infrastructure facilities,
`(B) such obligation has received a published rating, and
`(C) the development of such infrastructure facilities have been or
will be undertaken by a governmental entity or public-private
partnership,
as such terms are defined in section 4 of the National Infrastructure
Development Act of 1997.
`(4) CERTIFICATION OF INFRASTRUCTURE FACILITIES- An issuer of an
obligation of which 95 percent or more of the net proceeds are to be used in
connection with the financing or refinancing of 1 or more facilities may
apply to the National Infrastructure Development Corporation, in accordance
with such procedures as such corporation may establish, for certification
that any such facility is an infrastructure facility (as defined in section
4 of the National Infrastructure Development Act of 1997). Certification by
the Corporation shall create a presumption of such status, but shall not be
binding on the Secretary.
`(5) LEGEND REQUIRED- No obligation shall be a public benefit bond for
purposes of this subsection unless it is designated as intended to be a
public benefit bond on the date of issuance and bears a legend to such
effect.
`(6) QUALIFIED RETIREMENT PLAN- For purposes of this subsection, the
term `qualified retirement plan' means--
`(A) a qualified retirement plan (as defined in section 4974(c)),
and
`(B) an eligible deferred compensation plan (as defined in section
457(b)).
`(7) TREATMENT OF DIVIDENDS FROM MUTUAL FUNDS-
`(A) IN GENERAL- For purposes of this subsection, in the case of any
dividend (other than a dividend described in section 854(a)) received from
a regulated investment company which meets the requirements of section 852
for the taxable year in which it paid the dividend--
`(i) the entire amount of such dividend shall be treated as interest
on a public benefit bond if the aggregate interest on such bonds
received by such company during the taxable year equals or exceeds 75
percent of its gross income, or
`(ii) if clause (i) does not apply, a portion of such dividend shall
be treated as interest on a public benefit bond based on the portion of
the company's gross income which consists of such interest.
`(B) NOTICE TO SHAREHOLDERS- The amount of any distribution by a
regulated investment company which may be taken into account as interest
on a public benefit bond for purposes of this section shall not exceed the
amount so designated by the company in a written notice to its
shareholders mailed not later than 45 days after the close of its taxable
year.
`(C) GROSS INCOME- For purposes of this section, the term `gross
income' does not include gain from the sale or other disposition of stock
or securities.'.
(b) CONFORMING AMENDMENTS-
(1) Subsection (w) of section 72 of the Internal Revenue Code of 1986 is
amended by adding the following new paragraph:
`(4) TREATMENT OF QUALIFYING PUBLIC BENEFIT BOND INTEREST- For purposes
of subsections (c)(1)(A) and (c)(2)(A), the total amount of public benefit
bond interest described in subsection (w) with respect to a participant in a
qualified retirement plan (determined without reference to the annuity
starting date) shall be treated as an investment in the contract.'.
(c) EFFECTIVE DATE- The amendment made this section shall apply to
distributions after the date of the enactment of this Act.
SEC. 19. AUTHORIZATIONS.
(a) APPROPRIATIONS AUTHORIZED FOR ESTABLISHMENT- There are hereby
authorized to be appropriated to the Secretary $30,000,000 for the purpose of
facilitating the NIC's initial operations.
(b) APPROPRIATIONS AUTHORIZED FOR CONDUCT OF BUSINESS OF NIC- There are
authorized to be appropriated to the Secretary $1,000,000,000 for each of the
fiscal years 2000 through 2003 to make the capital contributions in accordance
with section 9(a)(1)(A) for the purpose of carrying out this Act.
(c) ESTABLISHMENT OF NIC ACCOUNT- Before the transition date, the funds
appropriated under subsection (b) shall be deposited in an account to be
established in the Treasury of the United States to be known as the `National
Infrastructure Development Corporation Account', which shall be available to
the Corporation, without need for further appropriation and without fiscal
year limitation, for carrying out its purposes, functions and powers,
including the investment and reinvestment of these funds as permitted in this
Act, and which shall not be subject to apportionment under subchapter II of
chapter 15 of title 31. The Secretary of the Treasury, in consultation with
the board of directors of the Corporation, shall invest amounts in the account
in public debt securities with maturities suitable to the needs of the account
and bearing interest at rates determined by the Secretary, taking into
consideration current market yields on outstanding marketable obligations of
the United States of comparable maturities.
SEC. 20. PROHIBITION ON ADDITIONAL FEDERAL ASSISTANCE.
Except as otherwise specifically provided by sections 13 and 19, NIC shall
receive no appropriations, loans, or other financial assistance from the
Federal Government.
END