Page:United States Statutes at Large Volume 110 Part 3.djvu/110

 110 STAT. 1840 PUBLIC LAW 104-188—AUG. 20, 1996 26 USC 4001 (c) EFFECTIVE DATE. —The amendments made by this section "ote. shall apply with respect to sales occurring after the date which is 7 days after the date of the enactment of this Act. SEC. 1608. TERMINATION OF FUTURE TAX-EXEMPT BOND FINANCING FOR LOCAL FURNISHERS OF ELECTRICITY AND GAS. (a) IN GENERAL.— Section 142(f) (relating to local furnishing of electric energy or gas) is amended by adding at the end the following new paragraphs: "(3) TERMINATION OF FUTURE FINANCING.—For purposes of this section, no bond may be issued as part of an issue described in subsection (a)(8) with respect to a facility for the local furnishing of electric energy or gas on or after the date of the enactment of this paragraph unless— " (A) the facility will— "(i) be used by a person who is engaged in the local furnishing of that energy source on January 1, 1997, and "(ii) be used to provide service within the area served by such person on January 1, 1997, (or within a county or city any portion of which is within such area), or "(B) the facility will be used by a successor in interest to such person for the same use and within the same service area as described in subparagraph (A). " (4) ELECTION TO TERMINATE TAX-EXEMPT BOND FINANCING BY CERTAIN FURNISHERS. — "(A) IN GENERAL.—In the case of a facility financed with bonds issued before the date of the enactment of this paragraph which would cease to be tax-exempt by reason of the failure to meet the local furnishing requirement of subsection (a)(8) as a result of a service area expansion, such bonds shall not cease to be tax-exempt bonds (and section 150(b)(4) shall not apply) if the person engaged in such local furnishing by such facility makes an election described in subparagraph (B). "(B) ELECTION.— An election is described in this subparagraph if it is an election made in such manner as the Secretary prescribes, and such person (or its predecessor in interest) agrees that— "(i) such election is made with respect to all facilities for the local furnishing of electric energy or gas, or both, by such person, "(ii) no bond exempt from tax under section 103 and described in subsection (a)(8) may be issued on or after the date of the enactment of this paragraph with respect to all such facilities of such person, "(iii) any expansion of the service area— "(I) is not financed with the proceeds of any exempt facility bond described in subsection (a)(8), and "(II) is not treated as a nonqualifying use under the rules of paragraph (2), and "(iv) all outstanding bonds used to finance the facilities for such person are redeemed not later than 6 months after the later of—

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