Partnership to Build America Act of 2013 - Establishes the American Infrastructure Fund (AIF) as a wholly-owned government corporation to provide bond guarantees and make loans to state and local governments and non-profit infrastructure providers for transportation, energy, water, communications, or educational facility infrastructure projects (Qualified Infrastructure Projects [QIPs]). Requires AIF also to make equity investments in QIPs such entities sponsor.
Directs the Secretary of the Treasury, acting through the AIF, to issue American Infrastructure Bonds with an aggregate face value of $50 billion. Requires proceeds from the sale of the bonds to be deposited into the AIF.
Amends the Internal Revenue Code to allow U.S. corporations to exclude from gross income qualified cash dividend amounts received during a taxable year from a foreign-controlled corporation equal to the face value of qualified infrastructure bonds the corporation has purchased.
Prohibits allowance of a foreign tax credit to the excluded portion of any dividend received by a U.S. corporation. Prohibits also the allowance of a deduction for expenses related to that excludable portion.
[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2084 Introduced in House (IH)]
113th CONGRESS
1st Session
H. R. 2084
To establish the American Infrastructure Fund, to provide bond
guarantees and make loans to States, local governments, and non-profit
infrastructure providers for investments in certain infrastructure
projects, and to provide equity investments in such projects, and for
other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 22, 2013
Mr. Delaney (for himself, Mr. Barr, Mr. Bera of California, Mr. Carney,
Mr. Cole, Mr. Connolly, Mr. Rodney Davis of Illinois, Mr. Fitzpatrick,
Ms. Gabbard, Mr. Garcia, Mr. Gibson, Mr. Johnson of Ohio, Mr. Joyce,
Mr. Kennedy, Mr. Kind, Mr. Kinzinger of Illinois, Mr. Messer, Mr.
Moran, Mr. Murphy of Florida, Mr. Peters of California, Mr. Pittenger,
Mr. Polis, Mr. Ruppersberger, Ms. Sinema, Mr. Stivers, Mr. Turner, and
Mr. Yoho) 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
_______________________________________________________________________
A BILL
To establish the American Infrastructure Fund, to provide bond
guarantees and make loans to States, local governments, and non-profit
infrastructure providers for investments in certain infrastructure
projects, and to provide equity investments in such projects, 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 ``Partnership to Build America Act of
2013''.
SEC. 2. AMERICAN INFRASTRUCTURE FUND.
(a) American Infrastructure Fund.--
(1) In general.--There is established a wholly owned
Government corporation to be called the American Infrastructure
Fund (``AIF'')--
(A) which shall be headed by the Board of Trustees
established under subsection (b);
(B) which may have separate sub-accounts or
subsidiaries for funds used to make loans, bond
guarantees, and equity investments under this section
and funds used to make bond guarantees under this
section;
(C) which shall be available to the AIF to pay for
the costs of carrying out this section, including the
compensation of the Board and other employees of the
AIF; and
(D) the funds of which may be invested by the Board
in such manner as the Board determines appropriate.
(2) Deposits to aif.--All funds received from bond
issuances, loan payments, bond guarantee fees, and any other
funds received in carrying out this section shall be held by
AIF.
(3) Limitations.--The charter of the AIF shall limit its
activities to those activities described as the mission of the
Board under subsection (b)(2).
(4) Oversight.--The AIF shall register with the Securities
and Exchange Commission and the Secretary shall report to
Congress annually as to whether the AIF is fulfilling the
mission of the Board under subsection (b)(2).
(5) Treatment of aif.--Title 31, United States Code, is
amended in each of sections 9107(c)(3) and 9108(d)(2)--
(A) by inserting ``the American Infrastructure
Fund,'' after ``the Regional Banks for Cooperatives,'';
and
(B) by striking ``those banks'' and inserting
``those entities''.
(b) Board of Trustees.--
(1) In general.--There is established a Board of Trustees
of the AIF (the ``Board''), which shall be composed of 11
members, of which at least 4 must be risk management experts,
as certified by the Board, having substantial experience in
bond guarantees or municipal credit.
(2) Mission.--The Mission of the Board is--
(A) to operate the AIF and its subsidiaries to be a
low cost provider of bond guarantees, loans, and equity
investments to State and local governments and non-
profit infrastructure providers for both urban and
rural non-profit infrastructure projects that provide a
positive economic impact and to meet such other
standards as the Board may develop;
(B) to operate the AIF in a self-sustaining manner
so as to allow the AIF to repay its infrastructure
bonds when due;
(C) to not have a profit motive, but seek at all
times to pursue its mission of providing low cost bond
guarantees and loans while covering its costs, reserves
as may be needed, and applying prudent underwriting
standards;
(D) to only consider projects put forth by State
and local governments and not to seek projects
directly;
(E) to at all times make clear that no taxpayer
money supports the AIF or ever will; and
(F) to engage in no other activities other than
those permitted under this section.
(3) Membership.--
(A) Presidentially-appointed members.--Except as
provided under subparagraph (C), 4 members of the Board
shall be appointed by the President, by and with the
advice and consent of the Senate, and serve for a term
of 7 years.
(B) Additional members.--Except as provided under
subparagraph (C), 7 members of the Board shall be
appointed by the current members of the Board appointed
pursuant to this subparagraph or subparagraph (C)(ii),
and serve for a term of 7 years.
(C) Initial members.--The Board shall initially
consist of the following members, who shall be
appointed not later than the end of the 60-day period
beginning on the date that bonds are issued under
subsection (e):
(i) Four members, appointed by the
President, by and with the advice and consent
of the Senate.
(ii) Seven additional members, appointed
one each by the seven entities purchasing the
largest amount of bonds (by aggregate face
amount of bonds purchased) under subsection
(e).
(D) Staggered terms.--The members of the Board
shall serve staggered terms, with 2 each of the initial
members of the Board serving for terms of 4, 5, 6, 7,
and 8 years, respectively, and the initial Chair
selected under subparagraph (E) serving for 9 years.
The decision of which Board members, other than the
Chair, serve for which initial terms shall be made by
the members of the Board drawing lots.
(E) Chair.--The members of the Board shall choose 1
member to serve as the Chair of the Board for a term of
7 years, except that the initial Chair shall serve for
a term of 7 years, as described under subparagraph (D).
(F) Vacancies.--Any member of the Board appointed
to fill a vacancy occurring before the expiration of
the term to which that member's predecessor was
appointed shall be appointed only for the remainder of
the term.
(G) Continuation of service.--Each member of the
Board may continue to serve after the expiration of the
term of office to which that member was appointed until
a successor has been appointed.
(H) Conflicts of interest.--No member of the Board
may have a financial interest in, or be employed by, a
Qualified Infrastructure Project (``QIP'') related to
assistance provided under this section or any entity
that has purchased bonds under subsection (e). Owning
municipal credit of any State or local government or
owning the securities of a diversified company that
engages in infrastructure activities, provided those
activities constitute less than 20 percent of the
company's revenues, or investing in broadly held
investment funds shall not be deemed to create a
conflict of interest. The Board may issue regulations
to define terms used under this subparagraph.
(4) Compensation.--The members of the Board shall be
compensated at an amount to be set by the Board, but under no
circumstances may such compensation be higher than the rate
prescribed for level IV of the Executive Schedule under section
5315 of title 5, United States Code.
(5) Staff.--The Board shall employ and set compensation for
such staff as the Board determines as is necessary to carry out
the activities and mission of the AIF, and such staff may be
paid without regard to the provisions of chapter 51 and
subchapter III of chapter 53, United States Code, relating to
classification and General Schedule pay rates.
(6) Procedures.--The Board shall establish such procedures
as are necessary to carry out this section.
(7) Corporate governance standards.--
(A) Board committees generally.--The Board shall
maintain all of the committees required to be
maintained by the board of directors of an issuer
listed on the New York Stock Exchange as of the date of
the enactment of this section.
(B) Risk management committee.--The Board shall
maintain a risk management committee, which shall--
(i) consist of 4 members of the Board, with
the initial 4 members consisting of 2 members
appointed under paragraph (3)(C)(i) and 2
members appointed under paragraph (3)(C)(ii);
(ii) employ additional staff who are
certified by the Board as having significant
and relevant experience in insurance
underwriting and credit risk management; and
(iii) establish the risk management
policies used by the Board.
(C) Standards.--The Board shall, to the extent
practicable, follow all standards with respect to
corporate governance that are required to be followed
by the board of directors of an issuer listed on the
New York Stock Exchange as of the date of the enactment
of this section.
(c) Infrastructure Investment.--
(1) In general.--The AIF shall provide bond guarantees to
debt issued by State and local governments and non-profit
infrastructure providers, make loans to States, local
governments, and non-profit infrastructure providers, and make
equity investments in projects sponsored by State and local
governments and non-profit infrastructure provider to help
Qualified Infrastructure Projects (``QIPs''). The AIF may not
make any loans or provide bond guaranties to for-profit
entities.
(2) Qualified infrastructure projects.--A project qualifies
as a QIP under this section if--
(A) the project involves the construction,
maintenance, improvement, or repair of a
transportation, energy, water, communications, or
educational facility; and
(B) the recipient of bond guarantees, loans, equity
investments, or any other financing technique
authorized under this Act provides written assurances
prescribed by the AIF that the project will be
performed in compliance with the requirements of all
Federal laws that would otherwise apply to similar
projects to which the United States is a party.
(3) Application for assistance.--
(A) In general.--A State or local government that
wishes to receive a loan or bond guarantee under this
section shall submit an application to the Board in
such form and manner and containing such information as
the Board may require.
(B) Requirement for non-profit infrastructure
providers to apply through state or local
governments.--A non-profit infrastructure provider may
only receive a bond guarantee, loan, or equity
investment under this section if the State or local
government for the jurisdiction in which the non-profit
infrastructure provider is located submits an
application pursuant to subparagraph (A) on behalf of
such non-profit infrastructure provider.
(4) Limitations on single state awards.--
(A) Annual limitation.--The Board shall set an
annual limit, as a percentage of total assistance
provided under this section during a year, on the
amount of assistance a single State (including local
governments and other non-profit infrastructure
providers within such State) may receive in assistance
provided under this section.
(B) Cumulative limitation.--The Board shall set a
limit, as a percentage of total assistance provided
under this section outstanding at any one time, on the
amount of assistance a single State (including local
governments and other non-profit infrastructure
providers within such State) may receive in assistance
provided under this section.
(5) Loan specifications.--Loans made under this section
shall have such maturity and carry such interest rate as the
Board determines appropriate.
(6) Bond guarantee.--The Board shall charge such fees for
Bond guarantees made under this section as the Board determines
appropriate.
(7) Equity investments.--With respect to a QIP, the amount
of an equity investment made by the AIF in such QIP may not
exceed 20 percent of the total cost of the QIP.
(8) Public-private partnership requirements.--At least 25
percent of the assistance provided under this section shall be
provided to QIPs for which at least 20 percent of the financing
for such QIPs comes from private debt or equity.
(9) Prohibition on principal forgiveness.--With respect to
a loan made under this section, the Board may not forgive any
amount of principal on such loan.
(d) American Infrastructure Bonds.--
(1) In general.--The Secretary shall, not later than the
end of the 90-day period following the date of the enactment of
this section and acting through the AIF, issue bonds, to be
called ``American Infrastructure Bonds'', the proceeds from
which shall be deposited into the AIF.
(2) Forms and denominations; interest.--American
Infrastructure Bonds shall--
(A) be in such forms and denominations as
determined by the Secretary, and shall have a 50-year
maturity; and
(B) bear interest of 1 percent.
(3) No full faith and credit.--Interest and principal
payments paid to holders of American Infrastructure Bonds shall
be paid from the AIF, to the extent funds are available, and
shall not be backed by the full faith and credit of the United
States.
(4) Amount of bonds.--The aggregate face amount of the
bonds issued under this subsection shall be $50,000,000,000.
(5) Sale of american infrastructure bonds.--
(A) Competitive bidding process.--The Secretary
shall sell the $50,000,000,000 of American
Infrastructure Bonds--
(i) through a competitive bidding process
that encourages aggressive bidding;
(ii) in a manner so as to ensure that there
are at least 7 different un-affiliated
purchasers; and
(iii) with prospective purchasers bidding
on how low of a multiplier they will accept
(for purposes of subsection (b)(1) of section
966 of the Internal Revenue Code of 1986) when
purchasing the American Infrastructure Bonds,
for purposes of applying the foreign earnings
exclusion described under that section.
(B) Limitation.--The multiplier described under
subparagraph (A)(iii) may not be greater than 6.
(6) Reimbursement of costs.--The Board shall repay the
Secretary, from funds in the AIF, for the costs to the
Secretary in carrying out this subsection.
(e) Additional Bonds.--
(1) In general.--The Board may issue such other bonds as
the Board determines appropriate, the proceeds from which shall
be deposited into the AIF.
(2) No full faith and credit.--Interest and principal
payments paid to holders of bonds issued pursuant to paragraph
(1) shall be paid from the AIF, to the extent funds are
available, and shall not be backed by the full faith and credit
of the United States.
(f) Definitions.--For purposes of this section:
(1) Bond guarantee.--The term ``bond guarantee'' has the
meaning given the term ``loan guarantee'' under section 502 of
the Federal Credit Reform Act of 1990 (2 U.S.C. 661a).
(2) Cost.--With respect to a loan or a bond guarantee, the
term ``cost'' has the meaning given such term under section 502
of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a).
(3) Non-profit infrastructure provider.--The term ``non-
profit infrastructure provider'' means a non-profit entity that
seeks to finance a QIP.
(4) Loan.--The term ``loan'' has the meaning given the term
``direct loan'' under section 502 of the Federal Credit Reform
Act of 1990 (2 U.S.C. 661a).
(5) Secretary.--The term ``Secretary'' means the Secretary
of the Treasury.
(6) State.--The term ``State'' means each of the several
States, the District of Columbia, any territory or possession
of the United States, and each federally recognized Indian
tribe.
SEC. 3. FOREIGN EARNINGS EXCLUSION FOR PURCHASE OF INFRASTRUCTURE
BONDS.
(a) In General.--Subpart F of part III of subchapter N of chapter 1
of the Internal Revenue Code of 1986 is amended by adding at the end
the following new section:
``SEC. 966. FOREIGN EARNINGS EXCLUSION FOR PURCHASE OF INFRASTRUCTURE
BONDS.
``(a) Exclusion.--In the case of a corporation which is a United
States shareholder and for which the election under this section is in
effect for the taxable year, gross income does not include an amount
equal to the qualified cash dividend amount.
``(b) Qualified Cash Dividend Amount.--For purposes of this
section, the term `qualified cash dividend amount' means an amount of
the cash dividends which are received during a taxable year by such
shareholder from controlled foreign corporations equal to--
``(1) the multiplier determined under section 2(d)(5) of
the Partnership to Build America Act of 2013 for such
shareholder, multiplied by
``(2) the face amount of qualified infrastructure bonds
acquired at its original issue (directly or through an
underwriter) by such shareholder.
``(c) Limitations.--
``(1) In general.--The amount of dividends taken into
account under subsection (a) for a taxable year shall not
exceed the lesser of--
``(A) the cash dividends received by the taxpayer
for such taxable year, or
``(B) the amount shown on the applicable financial
statement as earnings permanently reinvested outside
the United States.
``(2) Dividends must be extraordinary.--The amount of
dividends taken into account under subsection (a) shall not
exceed the excess (if any) of--
``(A) the cash dividends received during the
taxable year by such shareholder from controlled
foreign corporations, over
``(B) the annual average for the base period years
of the cash dividends received during each base period
year by such shareholder from controlled foreign
corporations.
``(3) Reduction of benefit if increase in related party
indebtedness.--The amount of dividends which would (but for
this paragraph) be taken into account under subsection (a)
shall be reduced by the excess (if any) of--
``(A) the amount of indebtedness of the controlled
foreign corporation to any related person (as defined
in section 954(d)(3)) as of the close of the taxable
year for which the election under this section is in
effect, over
``(B) the amount of indebtedness of the controlled
foreign corporation to any related person (as so
defined) as of the close of the preceding taxable year.
All controlled foreign corporations with respect to which the
taxpayer is a United States shareholder shall be treated as 1
controlled foreign corporation for purposes of this subsection.
The Secretary may prescribe such regulations as may be
necessary or appropriate to prevent the avoidance of the
purposes of this subsection, including regulations which
provide that cash dividends shall not be taken into account
under subsection (a) to the extent such dividends are
attributable to the direct or indirect transfer (including
through the use of intervening entities or capital
contributions) of cash or other property from a related person
(as so defined) to a controlled foreign corporation.
``(d) Definitions and Special Rules.--For purposes of this
section--
``(1) Qualified infrastructure bonds.--The term `qualified
infrastructure bond' means a bond issued under section 2(d) of
the Partnership to Build America Act of 2013.
``(2) Applicable financial statement.--The term `applicable
financial statement' means, with respect to a taxable year--
``(A) with respect to a United States shareholder
which is required to file a financial statement with
the Securities and Exchange Commission (or which is
included in such a statement so filed by another
person), the most recent audited annual financial
statement (including the notes which form an integral
part of such statement) of such shareholder (or which
includes such shareholder)--
``(i) which was so filed for such taxable
year, and
``(ii) which is certified as being prepared
in accordance with generally accepted
accounting principles, and
``(B) with respect to any other United States
shareholder, the most recent audited financial
statement (including the notes which form an integral
part of such statement) of such shareholder (or which
includes such shareholder)--
``(i) which is certified as being prepared
in accordance with generally accepted
accounting principles, and
``(ii) which is used for the purposes of a
statement or report--
``(I) to creditors,
``(II) to shareholders, or
``(III) for any other substantial
nontax purpose.
``(3) Base period years.--
``(A) In general.--The base period years are the 3
taxable years--
``(i) which are among the 5 most recent
preceding taxable years ending before the
taxable year, and
``(ii) which are determined by
disregarding--
``(I) 1 taxable year for which the
amount described in subsection
(c)(2)(B) is the largest, and
``(II) 1 taxable year for which
such amount is the smallest.
``(B) Shorter period.--If the taxpayer has fewer
than 5 taxable years ending before the taxable year,
then in lieu of applying subparagraph (A), the base
period years shall include all the taxable years of the
taxpayer ending before such taxable year.
``(C) Mergers, acquisitions, etc.--
``(i) In general.--Rules similar to the
rules of subparagraphs (A) and (B) of section
41(f)(3) shall apply for purposes of this
paragraph.
``(ii) Spin-offs, etc.--If there is a
distribution to which section 355 (or so much
of section 356 as relates to section 355)
applies during the 5-year period referred to in
subparagraph (A)(i) and the controlled
corporation (within the meaning of section 355)
is a United States shareholder--
``(I) the controlled corporation
shall be treated as being in existence
during the period that the distributing
corporation (within the meaning of
section 355) is in existence, and
``(II) for purposes of applying
subsection (c)(2) to the controlled
corporation and the distributing
corporation, amounts described in
subsection (c)(2)(B) which are received
or includible by the distributing
corporation or controlled corporation
(as the case may be) before the
distribution referred to in subclause
(I) from a controlled foreign
corporation shall be allocated between
such corporations in proportion to
their respective interests as United
States shareholders of such controlled
foreign corporation immediately after
such distribution.
Subclause (II) shall not apply if neither the
controlled corporation nor the distributing
corporation is a United States shareholder of
such controlled foreign corporation immediately
after such distribution.
``(4) Dividend.--The term `dividend' shall not include
amounts includible in gross income as a dividend under section
78, 367, or 1248. In the case of a liquidation under section
332 to which section 367(b) applies, the preceding sentence
shall not apply to the extent the United States shareholder
actually receives cash as part of the liquidation.
``(5) Coordination with dividend received deduction.--No
deduction shall be allowed under section 243 or 245 for any
dividend which is excluded from income by subsection (a).
``(6) Controlled groups.--All United States shareholders
which are members of an affiliated group filing a consolidated
return under section 1501 shall be treated as one United States
shareholder.
``(7) Reporting.--The Secretary shall require by regulation
or other guidance the reporting of such information as the
Secretary may require to carry out this section.
``(e) Denial of Foreign Tax Credit; Denial of Certain Expenses.--
``(1) Foreign tax credit.--
``(A) In general.--No credit shall be allowed under
section 901 for any taxes paid or accrued (or treated
as paid or accrued) with respect to the excluded
portion of any dividend.
``(B) Denial of deduction of related tax.--No
deduction shall be allowed under this chapter for any
tax for which credit is not allowable by reason of the
preceding sentence.
``(2) Expenses.--No deduction shall be allowed for expenses
directly allocable to the excludable portion described in
paragraph (1).
``(3) Excludable portion.--For purposes of paragraph (1),
unless the taxpayer otherwise specifies, the excludable portion
of any dividend or other amount is the amount which bears the
same ratio to the amount of such dividend or other amount as
the amount excluded from income under subsection (a) for the
taxable year bears to the amount described in subsection
(c)(2)(A) for such year.
``(4) Coordination with section 78.--Section 78 shall not
apply to any tax which is not allowable as a credit under
section 901 by reason of this subsection.
``(f) Election To Have Section Apply.--A taxpayer may elect to have
this section apply for any taxable year.''.
(b) Clerical Amendment.--The table of sections for subpart F of
part III of subchapter N of chapter 1 of such Code is amended by adding
at the end the following new item:
``Sec. 966. Foreign earnings exclusion for purchase of infrastructure
bonds.''.
(c) Effective Date.--The amendments made by this section shall
apply to dividends received for taxable years ending after the date of
the enactment of this Act.
<all>
Introduced in House
Introduced in House
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.
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.
Referred to the Subcommittee on Aviation.
Referred to the Subcommittee on Highways and Transit.
Referred to the Subcommittee on Railroads, Pipelines, and Hazardous Materials.
Referred to the Subcommittee on Water Resources and Environment.
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