This Notice solicits applications for the reallocation of available amounts of national bond issuance authority limitation for tribal economic development bonds ("Tribal Economic Development Bonds") that were previously allocated to eligible issuers by the Internal Revenue Service ("IRS") and that have not been used. This Notice also provides related guidance on: (1) the application requirements and forms for requests for volume cap allocations, and (2) the method that the IRS and the Department of the Treasury will use to allocate the volume cap.
The collection of information falls within both prongs of section 3507(j)(1)(A). First, as required by section 3507(j)(1)(A)(i), the collection of information is needed prior to the expiration of the normal clearance period (approximately November 2012). Indian tribal economies would be significantly harmed by a delay in publication. Indian tribal governments now have a unique opportunity to finance, under section 7871(f), up to $1.8 billion of economic development projects at historically low interest rates. Tribal governments have expressed great interest in publication of this notice and have informed the IRS that significant projects can be immediately funded following publication of the notice. Construction of bond-financed projects will provide employment opportunities for members of these tribes, many of whom have suffered disproportionately from depressed local economies. Further delay in publication of this notice may postpone the start of bond-financed construction projects, many of which are located in the northern United States, until after winter, further delaying the economic benefits of these projects. Additionally, as evidenced by numerous Congressional inquiries, the date of publication of this notice is a matter of concern to members of Congress. Officials from the Department of the Treasury testified before the Senate Committee on Indian Affairs on June 14, 2012, that this notice would be published in Âthe very near future. Expedited publication of the notice will also be helpful to Treasury officials and tribal finance officers who will be discussing bond financing at a conference hosted by the Native American Finance Officers Association on July 17, 2012. Second, as required by section 3507(j)(1)(A)(ii), the collection of information is essential to the IRS mission of efficient administration of the internal revenue laws. A tribal governmentÂs request for reallocation of volume cap, submitted in accordance with this notice, is a key component to the IRS effective and efficient administration of the exemption from income tax provided under section 7871(f) for interest paid on tribal economic development bonds.
Section 3507(j)(1)(B)
Pursuant to section 3507(j)(1)(B), the IRS cannot reasonably comply with the nonemergency procedures of section 3507. Section 3507(j)(1)(B) sets forth three criteria, at least one of which must apply: (i) public harm is reasonably likely to result if normal clearance procedures are followed; (ii) an unanticipated event has occurred; or (iii) the use of normal clearance procedures is reasonably likely to cause a statutory or court-ordered deadline to be missed. As discussed above, the first criterion, public harm, applies in this instance. Indian tribal economies would be significantly harmed by a delay in publication. Indian tribal governments now have a unique opportunity to finance, under section 7871(f), up to $1.8 billion of economic development projects at historically low interest rates. Tribal governments have expressed great interest in publication of this notice and have informed the IRS that significant projects can be immediately funded following publication of the notice. Construction of bond-financed projects will provide employment opportunities for members of these tribes, many of whom have suffered disproportionately from depressed local economies. Further delay in publication of this notice may postpone the start of bond-financed construction projects, many of which are located in the northern United States, until after winter, further delaying the economic benefits of these projects. To avoid irreparable harm to the finance and economies of Indian tribes, the approval of the collection of information in the notice is needed as quickly as possible and before it would ordinarily be granted under the standard procedures.
US Code:
26 USC 7871(f)
Name of Law: Tribal economic development bonds
US Code: 26 USC 7871(f) Name of Law: Tribal economic development bonds
Section 7871(f) provides that the interest on tribal economic development bonds issued by Indian tribal governments is exempt from income tax under section 103. Under section 7871(f)(1), this exemption from income tax cannot apply to more than $2 billion of such bonds, and the Secretary of the Treasury must allocate this volume cap among the tribal governments.
This notice provides procedures for tribal governments to apply for an allocation of the $1.8 billion of forfeited volume cap. This collection of information is necessary to track and allocate volume cap among the tribal governments.
This will result in an estimated annual increase of 1,001 burden hours.
$0
No
No
No
No
Yes
Uncollected
Timothy Jones 202 622-3980
Reginfo record details
No
On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).
The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control number;
If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.
Supporting Statement_TEDB.doc
Notice 2012-XX: Tribal Economic Development Bonds