Community Forestry and Agriculture Conservation Act of 1998

Community Forestry and Agriculture Conservation Act of 1998 - Amends the Internal Revenue Code to treat a bond issued to acquire renewable resources on land subject to a conservation easement as a tax-exempt (qualified 501(c)(3)) bond if the revenues from such resources' use or sale are used in a manner consistent with the charitable purpose of the issuer although not used as otherwise required.

[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4301 Introduced in House (IH)]

  2d Session
                                H. R. 4301

 To amend the Internal Revenue Code of 1986 to modify the treatment of 
    bonds issued to acquire renewable resources on land subject to 
                         conservation easement.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 22, 1998

 Ms. Dunn (for herself and Mr. Tanner) introduced the following bill; 
         which was referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to modify the treatment of 
    bonds issued to acquire renewable resources on land subject to 
                         conservation easement.

    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 ``Community Forestry and Agriculture 
Conservation Act of 1998''.

SEC. 2. TREATMENT OF BONDS ISSUED TO ACQUIRE RENEWABLE RESOURCES ON 
              LAND SUBJECT TO CONSERVATION EASEMENT.

    (a) In General.--Section 145 of the Internal Revenue Code of 1986 
(defining qualified 501(c)(3) bond) is amended by redesignating 
subsection (e) as subsection (f) and by inserting after subsection (d) 
the following new subsection:
    ``(e) Bonds Issued To Acquire Renewable Resources on Land Subject 
to Conservation Easement.--
            ``(1) In general.--If--
                    ``(A) the proceeds of any bond are used to acquire 
                land (or a long-term lease thereof) together with any 
                renewable resource associated with the land (including 
                standing timber, agricultural crops, or water rights),
                    ``(B) the land is subject to a conservation 
                restriction (granted in perpetuity) which meets the 
                requirements of--
                            ``(i) clauses (ii) and (iii)(II) of section 
                        170(h)(4)(A), and
                            ``(ii) relevant environmental and land use 
                        statutes and regulations, and
                    ``(C) such bond would be a qualified 501(c)(3) bond 
                (after the application of paragraph (2)) but for the 
                failure to use revenues derived by the 501(c)(3) 
                organization from the sale, lease, or other use of such 
                resource as otherwise required by this part,
        such bond shall not fail to be a qualified 501(c)(3) bond by 
        reason of the failure to so use such revenues if the revenues 
        which are not used as otherwise required by this part are used 
        in a manner consistent with the stated charitable purposes of 
        the 501(c)(3) organization.
            ``(2) Treatment of timber, etc.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), for purposes of sections 141 through 
                150, the cost of any renewable resource acquired with 
                proceeds of such bonds shall be treated as a cost of 
                acquiring the land supporting the renewable resource 
                and such land will not be treated as used for a private 
                business use because of the sale, leasing, or other use 
                of the renewable resource.
                    ``(B) Application of bond maturity limitation.--For 
                purposes of section 147(b), the cost of any land or 
                renewable resource acquired with proceeds of such bonds 
                shall have an economic life commensurate with the 
                economic and ecological feasibility of the financing of 
                such land or renewable resource.''
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to obligations issued after the date of the enactment of this 
Act.
                                 <all>