Page:United States Statutes at Large Volume 100 Part 3.djvu/797

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2605

"(6) PRIVATE BUSINESS USE DEFINED.—



"(A) IN GENERAL.—For purposes of this subsection, the term 'private business u s e ' means use (directly or indirectly) in a trade or business carried on by any person other than a government a l unit. For purposes of the preceding sentence, use as a m e m b e r of the general public shall not be t a k e n into account. "(B) CLARIFICATION O F TRADE OR BUSINESS.—For purposes

of the 1st sentence of subparagraph (A), any activity carried on by a person other than a n a t u r a l person shall be t r e a t e d as a trade or business. "(7) GOVERNMENT USE.—The term 'government use' means any use other than a private business use. "(8) N O N Q U A L I F I E D A M O U N T. — For purposes of t h i s subsection,

?^ 1^,

the term 'nonqualified a m o u n t ' means, with respect to a n issue, the lesser of— "(A) the proceeds of such issue which a r e to be used for any private business use, or "(B) the proceeds of such issue with respect to which the r e a r e payments (or property or borrowed money) described in paragraph (2). "(9) EXCEPTION FOR QUALIFIED 501(C)(3) BONDS.—There

^'

shall

not be t a k e n into account under this subsection or subsection (c) the portion of the proceeds of a n issue which (if issued as a s e p a r a t e issue) would be t r e a t e d as a qualified 501(c)(3) bond if the issuer elects to t r e a t such portion as a qualified 501(c)(3) bond.

• "(c) PRIVATE L O A N F I N A N C I N G T E S T. —

"(1) IN GENERAL.—An issue meets the test of this subsection if ' the a m o u n t of the proceeds of the issue which a r e to be used (directly or indirectly) to m a k e or finance loans (other than loans described in paragraph (2)) to persons other than government a l u n i t s exceeds the lesser of— "(B) $5,000,000. "(2) EXCEPTION FOR TAX ASSESSMENT, ETC., LOANS.—For p u r -
 * •"(A) 5 percent of such proceeds, or

i

poses of paragraph (1), a loan is described in this paragraph if such loan— i "(A) enables the borrower to finance any government a l i tax or assessment of general application for a specific essential government a l function, or <M' T " (B) is a nonpurpose investment (within the m e a n i n g of section 148(f)(6)(A)). "(d) QUALIFIED B O N D. — For purposes of this part, the term 'qualified bond' means any private activity bond if— "(1) IN GENERAL. — S u c h bond is—

"(A) a n exempt facility bond, "(B) a qualified mortgage bond, y, r- .,, "(C) a qualified veterans ' mortgage bond, "(D) a qualified small issue bond, ^ "(E) a qualified student loan bond, "(F) a qualified redevelopment bond, or "(G) a qualified 501(c)(3) bond. "(2) VOLUME CAP.—Such bond is issued as part of a n issue which meets the applicable requirements of section 146, and "(3) OTHER REQUIREMENTS.—Such bond m e e t s the applicable

requirements of each subsection of section 147.

�