article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Urban Recovery and Growth Act''. SEC. 2. EXTENSION OF RECOVERY ZONE ECONOMIC DEVELOPMENT BONDS FOR CERTAIN CITIES. (a) In General.--Part III of subchapter Y of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: ``SEC. 1400U-4. EXTENSION OF RECOVERY ZONE ECONOMIC DEVELOPMENT BONDS FOR CERTAIN CITIES. ``(a) In General.--In the case of an economic development extension bond-- ``(1) such bond shall be treated for purposes of section 6431 as a qualified bond issued before January 1, 2011, ``(2) subsection (b) of such section shall be applied by substituting `45 percent' for `35 percent', and ``(3) interest on such bond shall be includible in gross income. ``(b) Economic Development Extension Bond.--For purposes of this section-- ``(1) In general.--The term `economic development extension bond' means any specified bond issued during the 1-year period beginning on the date of the enactment of this section as part of an issue if-- ``(A) 100 percent of the excess of-- ``(i) the available project proceeds (as defined in section 54A) of such issue, over ``(ii) the amounts in a reasonably required reserve (within the meaning of section 150(a)(3)) with respect to such issue, are to be used for one or more qualified purposes, and ``(B) the issuer designates such bond for purposes of this section. ``(2) Specified bond.-- ``(A) In general.--The term `specified bond' means any obligation (other than a private activity bond) if the interest on such obligation would (but for this section) be excludable from gross income under section 103. ``(B) Applicable rules.--For purposes of applying subparagraph (A)-- ``(i) rules similar to the rules of section 54AA(d)(2) shall apply, and ``(ii) section 148 shall not apply with respect to any issue with respect to which the excess described in paragraph (1)(A) is used for a qualified purpose described in paragraph (3)(B). ``(3) Qualified purposes.--The term `qualified purposes' means-- ``(A) any qualified economic development purpose (as defined in section 1400U-2(c), applied by treating specified cities (and only specified cities) as recovery zones), and ``(B) any refinancing of indebtedness of a specified city which is outstanding on the date of the enactment of this section. ``(4) Specified city.--The term `specified city' means any principal city for a metropolitan statistical area (as determined by the Office of Management and Budget) which-- ``(A) has an average unemployment rate of not less than 150 percent of the national average rate for the last calendar year ending before the date of the enactment of this section, and ``(B) has lost at least 20 percent of its population between calendar year 2000 and calendar year 2010. ``(5) Limitation on amount of bonds designated.-- ``(A) In general.--The maximum aggregate face amount of bonds which may be designated under paragraph (1) with respect to any specified city shall not exceed the bond limitation allocated to such city under subparagraph (B). ``(B) Allocation.--The Secretary shall allocate bond limitation to each specified city such that the bond limitation allocated to such city bears the same proportion to $1,000,000,000 as the population of such city (as determined for purposes of the 2010 census) bears to the total population of all specified cities (as so determined).''. (b) Clerical Amendment.--The table of sections for part III of subchapter Y of chapter 1 of such Code is amended by adding at the end the following new item: ``Sec. 1400U-4. Extension of recovery zone economic development bonds for certain cities.''. (c) Effective Date.--The amendments made by this section shall apply to obligations issued after the date of the enactment of this Act.
summary: Urban Recovery and Growth Act - Amends the Internal Revenue Code to authorize the issuance of economic development extension bonds for the purpose of economic development or refinancing the indebtedness of a city that has an average unemployment rate of not less than 150% of the national average in the preceding calendar year and that has lost at least 20% of its population between 2000 and 2010.