Page:United States Statutes at Large Volume 119.djvu/1035

 PUBLIC LAW 109–58—AUG. 8, 2005

119 STAT. 1017

‘‘(iii) an interconnection with an intrastate transmission pipeline, or ‘‘(iv) a direct interconnection with a local distribution company, a gas storage facility, or an industrial consumer.’’. (c) ALTERNATIVE SYSTEM.—The table contained in section 168(g)(3)(B) (relating to special rule for certain property assigned to classes), as amended by this Act, is amended by inserting after the item relating to subparagraph (C)(iii) the following new item:

‘‘(C)(iv) .........................................................................................................

14’’.

(d) ALTERNATIVE MINIMUM TAX EXCEPTION.—Subparagraph (B) of section 56(a)(1) is amended by inserting before the period the following: ‘‘, or in section 168(e)(3)(C)(iv)’’. (e) EFFECTIVE DATE.— (1) IN GENERAL.—The amendments made by this section shall apply to property placed in service after April 11, 2005. (2) EXCEPTION.—The amendments made by this section shall not apply to any property with respect to which the taxpayer or a related party has entered into a binding contract for the construction thereof on or before April 11, 2005, or, in the case of self-constructed property, has started construction on or before such date.

26 USC 56 note.

SEC. 1327. ARBITRAGE RULES NOT TO APPLY TO PREPAYMENTS FOR NATURAL GAS.

(a) IN GENERAL.—Subsection (b) of section 148 (relating to higher yielding investments) is amended by adding at the end the following new paragraph: ‘‘(4) SAFE HARBOR FOR PREPAID NATURAL GAS.— ‘‘(A) IN GENERAL.—The term ‘investment-type property’ does not include a prepayment under a qualified natural gas supply contract. ‘‘(B) QUALIFIED NATURAL GAS SUPPLY CONTRACT.—For purposes of this paragraph, the term ‘qualified natural gas supply contract’ means any contract to acquire natural gas for resale by a utility owned by a governmental unit if the amount of gas permitted to be acquired under the contract by the utility during any year does not exceed the sum of— ‘‘(i) the annual average amount during the testing period of natural gas purchased (other than for resale) by customers of such utility who are located within the service area of such utility, and ‘‘(ii) the amount of natural gas to be used to transport the prepaid natural gas to the utility during such year. ‘‘(C) NATURAL GAS USED TO GENERATE ELECTRICITY.— Natural gas used to generate electricity shall be taken into account in determining the average under subparagraph (B)(i)— ‘‘(i) only if the electricity is generated by a utility owned by a governmental unit, and

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