Issuers of QZABs
receive 100 percent of the interest paid to the borrower if the interest were determined at the tax credit bond rate determined under section 54A(b) (3) for qualified tax credit bonds.
A list of Empowerment Zones and Enterprise Communities is available on the QZAB
site at www.
These agencies have considerable flexibility in using QZABs
for rehabilitating or repairing school facilities, purchasing equipment, developing curricula and training school personnel; they cannot be used for new construction.
Jeffrey Baratta, a San Francisco investment banker who structures QZAB
programs, stresses that QZABs
"require little government intervention at the least amount of cost to taxpayers.
Variable 8: * IRS has explicit requirements for investors and issuers Issuers: -are arbitrage exempt -must spend proceeds and interest on projects -have three years to spend funds -must calculate donations/PV Investors: -hold debt to maturity -certify taxable position for debt period Variable 9: * DELL Corp will contribute more than $1,852,076 * Other contributions totaled $1,859,178 * Other contributions will be used for future QZABs
Variable 10: * 7.
Initially, $400 million of QZABs
was authorized to be issued annually in calendar years 1998 and 1999.
She also reminded them 2005 QZABs
allocations will expire at the end of this year.
4 billion in 2002, and allow the proceeds of QZABs
to be used for construction.
In contrast to existing Federal subsidies for State and local debt issuance, which exempt subnational government bond interest from Federal income taxation, the QZAB
program is structured as a tax credit bond: Instead of yielding cash coupons exempt from Federal income tax, QZABs
entitle investors to Federal income tax credits.
First, because QZABs
are not required to be traditional bonds, but can be a simple loan, the issuance process may be streamlined and made less costly.