Page:United States Statutes at Large Volume 100 Part 3.djvu/796

 100 STAT. 2604

PUBLIC LAW 99-514—OCT. 22, 1986 "(3) 5 PERCENT TEST FOR PRIVATE BUSINESS USE NOT RELATED O. DISPROPORTIONATE TO GOVERNMENT USE FINANCED BY THE ISSUE.—

"(A) IN GENERAL.—An issue shall be treated as meeting the tests of paragraphs (1) and (2) if such tests would be met if such paragraphs were applied— "(i) by substituting '5 percent' for '10 percent' each J ^,. place it appears, and yAr -i "(ii) by taking into account only— "(I) the proceeds of the issue which are to be used for any private business use which is not related to V J, any government use of such proceeds, "(II) the disproportionate related business use proceeds of the issue, and "(III) payments, property, and borrowed money with respect to any use of proceeds described in subclause (I) or (II). "(B) DISPROPORTIONATE RELATED BUSINESS USE PROCEEDS.—

For purposes of subparagraph (A), the disproportionate related business use proceeds of an issue is an amount equal to the aggregate of the excesses (determined under the following sentence) for each private business use of the such proceeds. The excess determined under this sentence ^'^'is the excess of— "(i) the proceeds of the issue which are to be used for the private business use, over til V I "(ii) the proceeds of the issue which are to be used for the government use to which such private business use relates. "(4) LOWER LIMITATION FOR CERTAIN OUTPUT FACILITIES.—An
 * K1proceeds of an issue which is related to a government use of

issue 5 percent or more of the proceeds of which are to be used with respect to any output facility (other than a facility for the furnishing of water) shall be treated as meeting the tests of paragraphs (1) and (2) if the nonqualified amount with respect to such issue exceeds the excess of— n "(A) $15,000,000, over JJ.J > "(B) the aggregate nonqualified amounts with respect to all prior tax-exempt issues 5 percent or more of the proceeds of which are or will be used with respect to such facility (or any other facility which is part of the same project). There shall not be taken into account under subparagraph (B) any bond which is not outstanding at the time of the later issue or which is to be redeemed (other than in an advance refunding) from the net proceeds of the later issue. "(5) COORDINATION WITH VOLUME CAP WHERE NONQUALIFIED AMOUNT EXCEEDS $15,000,000.—If the nonqualified amount with

respect to an issue— "(A) exceeds $15,000,000, but "(B) does not exceed the amount which would cause -a bond which is part of such issue to be treated as a private activity bond without regard to this paragraph, such bond shall nonetheless be treated as a private activity bond unless the issuer allocates a portion of its volume cap under section 146 to such issue in an amount equal to the excess of such nonqualified amount over $15,000,000.

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