Telecommunications Ownership Diversification Act of 2003
A bill to amend the Internal Revenue Code of 1986 to provide for a deferral of tax on gain from the sale of telecommunications businesses in specific circumstances or a tax credit and other incentives to promote diversity of ownership in telecommunications businesses.
Legislative Activity
Stay on top of the latest movement without scrolling through every action
Read twice and referred to the Committee on Finance. (text of measure as introduced: CR S1829-1832)
January 30, 2003
View full timeline
Introduced in Senate
January 30, 2003
Sponsor introductory remarks on measure. (CR S1829)
January 30, 2003
Read twice and referred to the Committee on Finance. (text of measure as introduced: CR S1829-1832)
January 30, 2003
Floor Debate
22 membersWhat members said about S. 267 on the floor




+17
Floor Debate
22 membersWhat members said about S. 267 on the floor
Mr. President, I rise today to draw the attention of the Senate and those following this proceeding to a global emergency many of us believe the last Congress did not adequately address. Imagine the…
Mr. President, I rise today to introduce three welfare bills. Although these bills do not represent a comprehensive welfare reform proposal, they do address what I see as some of the most critical…
Mr. President, I want to express support on behalf of The Charity Aid, Recovery and Empowerment, CARE, Act of 2003, which I am introducing today with Senator Lieberman, Finance Committee Chairman…
Mr. President, I am pleased to join with Senator Feinstein today in renewing the call we made in the 107th Congress for improving vehicle fuel economy by taking logical steps to close the SUV…
Mr. President, I rise today to introduce the Children's Health Protection and Eligibility Act. I am delighted to be joined on this bill by my good friend, Senator Patty Murray. Senator Murray has…
Show 8 more
Mr. President, I am proud to join Senator Campbell to introduce the ``Law Enforcement Officers Safety Act of 2003,'' which permits current and retired law enforcement officers to carry a firearm and…
Mr. President, I am pleased to join Senators Snowe, Collins, Cantwell, Corzine, Dodd, Durbin, Jeffords, Leahy, Murray, Reed, Clinton, and Schumer in introducing legislation to increase Corporate…
Mr. President, Congress took an important step forward for working families earlier this month by providing unemployment benefits for nearly 3 million jobless Americans. These benefits are a lifeline…
Mr. President, today I am pleased to introduce the Law Enforcement Officers Safety Act of 2003. I am also especially pleased to have Senators Patrick Leahy and Orrin Hatch joining me today as lead…
Mr. President, I rise today to introduce the Captive Wildlife Safety Act, a firm commitment to protect public safety and the welfare of wild cats that are increasingly being kept as pets. I am joined…
Mr. President, today, I am introducing the ``The SUV Business Tax Loophole Closure Act'' along with Senator Schumer and Senator Clinton to close a loophole in tax law that some are inappropriately…
Mr. President, today my colleague Senator Bingaman and I are reintroducing our bill to increase mandatory funding for the Child Care and Development Block Grant, CCDBG. Our legislation, the Children…
Mr. President, I rise today to introduce, with my friend and colleague, Senator Corzine, the ``Municipal Debt Refinancing Act of 2003.'' We are pleased to be joined by Senator Schumer and Senator…
Show 10 more
Mr. President, it will be ten years ago this October that Americans watched in horror as a U.S. humanitarian effort went terribly askew. As frightening pictures from U.S. troops in Somalia came back…
Mr. President, today I rise to bring the Senate's attention to a matter that is slowing Los Alamos County, NM, in its efforts to fully recover from the Cerro Grande Fire of May 10, 2000. The Cerro…
Mr. President, I rise today to join with Senator Cantwell in introducing the Children's Health Protection and Eligibility Act. This important legislation will ensure that low income children in…
Mr. President, today I am introducing the Telecommunications Ownership Diversity Act of 2003. This legislation is designed to ensure that more Americans have an opportunity to provide their distinct…
Mr. President, today I am introducing the Telecommunications Ownership Diversity Act of 2003. This legislation is designed to ensure that more Americans have an opportunity to provide their distinct…
Mr. President, Senator Stabenow and I are introducing legislation similar to the measure we proposed in the last Congress to effectively prevent very rich individuals from reducing their taxes by…
Mr. President, today my colleague Senator Kay Bailey Hutchison and I are reintroducing a bill that will help repay our Nation's debt to the Gold Star Wives of America. This bill corrects a…
Mr. President, today, I am pleased to be joined by my distinguished colleagues in introducing legislation that addresses the welfare of exotic animals throughout the country. Specifically, this bill…
Mr. President, I rise today to introduce the Kaloko- Honokohau National Historical Park Addition Act of 2003. This bill passed the Senate by unanimous consent in the 107th Congress, and I hope that…
Mr. President, today I rise along with senators Campbell, Leahy, and others to introduce the ``Law Enforcement Officers Safety Act of 2003''. This bill, which permits qualified current and retired…
Bill Text
Latest available legislative text
[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 267 Introduced in Senate (IS)]
108th CONGRESS
1st Session
S. 267
To amend the Internal Revenue Code of 1986 to provide for a deferral of
tax on gain from the sale of telecommunications businesses in specific
circumstances or a tax credit and other incentives to promote diversity
of ownership in telecommunications businesses.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
January 30, 2003
Mr. McCain introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide for a deferral of
tax on gain from the sale of telecommunications businesses in specific
circumstances or a tax credit and other incentives to promote diversity
of ownership in telecommunications businesses.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Telecommunications Ownership
Diversification Act of 2003''.
SEC. 2. FINDINGS AND PURPOSES.
(a) Findings.--Congress makes the following findings:
(1) Current trends in the telecommunications industry show
that there is increasing convergence among various media,
including broadcasting, cable television, and Internet-based
businesses, that provide news, information, and entertainment.
(2) This convergence will continue, and therefore,
diversifying the ownership of telecommunications facilities
remains a preeminent public interest concern that should be
reflected in both telecommunications and tax policy.
(3) A market-based, voluntary system of investment
incentives is an effective, lawful, and economically sound
means of facilitating entry and diversification of ownership in
the telecommunications industry.
(4) Opportunities for new entrants to participate and grow
in the telecommunications industry have substantially decreased
since the end of the Federal Communications Commission's tax
certificate policy in 1995, particularly in light of the
availability of tax-free like-kind exchanges, despite the most
robust period of transfers of radio and television stations in
history. During this time, businesses owned or controlled by
socially disadvantaged individuals, including, but not limited
to, members of minority groups and women, have continued to be
underrepresented as owners of telecommunications facilities.
(5) Businesses owned or controlled by socially
disadvantaged individuals are, and historically have been,
economically disadvantaged in the telecommunications industry.
For these businesses, access to and cost of capital are and
have been substantial obstacles to new entry and growth.
Consequently, diversification of ownership in the
telecommunications industry has been limited.
(6) Telecommunications facilities owned by new entrants may
not be attractive to investors because their start-up costs are
often high, their revenue streams are uncertain, and their
profit margins are unknown.
(7) It is consistent with the public interest and with the
pro-competition policies of the Telecommunications Act of 1996
to provide incentives that will facilitate investments in, and
acquisition of, telecommunications facilities by economically
and socially disadvantaged businesses, thereby diversifying the
ownership of telecommunications facilities.
(8) Increased participation by economically and socially
disadvantaged businesses in the ownership of telecommunications
facilities will enhance competition in the telecommunications
industry. Permitting sellers of telecommunications facilities
to defer taxation of gains from transactions involving
economically and socially disadvantaged businesses, or certain
small businesses supported by investments from the
Telecommunications Development Fund that provides capital for
such businesses, will further the development of a competitive
and diverse United States telecommunications industry without
governmental intrusion in private investment decisions.
(9) The public interest would not be served by attempts to
diversify the ownership of telecommunications businesses
through any approach that would involve the use of mandated
set-asides or quotas.
(10) Today, the telecommunications industry is struggling
to survive one of its most troubling times. Therefore,
facilitating voluntary, pro-competitive transactions that will
promote ownership of telecommunications facilities by
economically and socially disadvantaged businesses and certain
small businesses will aid in providing the investment and
capital that is crucial to this sector.
(b) Purpose.--The purpose of this Act is to facilitate voluntary,
pro-competitive transactions that will promote ownership of
telecommunications facilities by economically and socially
disadvantaged businesses and certain small businesses.
SEC. 3. NONRECOGNITION OF GAIN ON CERTAIN QUALIFIED SALES OF
TELECOMMUNICATIONS BUSINESSES.
(a) In General.--Subchapter O of chapter 1 of the Internal Revenue
Code of 1986 (relating to gain or loss on disposition of property) is
amended by inserting after part IV the following new part:
``PART V--CERTAIN SALES OF TELECOMMUNICATIONS BUSINESSES
``Sec. 1071. Nonrecognition of gain on
certain sales of
telecommunications businesses.
``SEC. 1071. NONRECOGNITION OF GAIN ON CERTAIN SALES OF
TELECOMMUNICATIONS BUSINESSES.
``(a) In General.--For purposes of this subtitle, if a taxpayer
elects the application of this section to a qualified
telecommunications sale, such sale shall be treated as an involuntary
conversion of property within the meaning of section 1033.
``(b) Limitation on Amount of Gain on Which Tax May Be Deferred.--
``(1) In general.--The amount of gain on any qualified
telecommunications sale which is not recognized by reason of
this section--
``(A) shall not exceed $250,000,000 per sale, and
``(B) shall not exceed \1/3\ of such dollar amount
per taxable year.
``(2) Carryforwards of unused amounts.--If the amount of
gain on any qualified telecommunications sale which is not
recognized by reason of this section exceeds the limitation
imposed by paragraph (1)(B) for the taxable year, such excess
shall be carried to the succeeding taxable year and added to
the amount allowable under this section for such taxable year.
``(c) Qualified Telecommunications Sale.--For purposes of this
section, the term `qualified telecommunications sale' means any sale to
an eligible purchaser of--
``(1) the assets of a telecommunications business, or
``(2) stock in a corporation if, immediately after such
sale--
``(A) the eligible purchaser controls (within the
meaning of section 368(c)) such corporation, and
``(B) substantially all of the assets of such
corporation are assets of 1 or more telecommunications
businesses, or
``(3) an interest in a partnership if, immediately after
such sale--
``(A) the eligible purchaser owns a partnership
interest possessing--
``(i) at least 80 percent of the total
combined voting power of all classes of
partnership interests entitled to vote,
``(ii) control over the management of the
partnership,
``(iii) at least 80 percent of the capital
interests of the partnership, and
``(iv) a distributive share of at least 80
percent of each item of the partnership's
income, gain, loss, deduction or credit, and
``(B) substantially all of the assets of such
partnership are assets of 1 or more telecommunications
businesses.
``(d) Special Rules.--
``(1) In general.--In applying section 1033 for purposes of
subsection (a), stock of a corporation or an interest in a
partnership operating a telecommunications business, whether or
not representing control of such corporation or partnership,
shall be treated as property similar or related in service or
use to the property sold in the qualified telecommunications
sale.
``(2) Election to reduce basis rather than recognize
remainder of gain.--If--
``(A) a taxpayer elects the treatment under
subsection (a) with respect to any qualified
telecommunications sale, and
``(B) an amount of gain would (but for this
paragraph) be recognized on such sale under section
1033(a)(2)(A) in excess of the amount required to be
recognized by reason of subsection (b),
then the amount of gain described in this subparagraph shall
not be recognized to the extent that the taxpayer elects to
reduce the basis of depreciable property (within the meaning of
section 1017(b)(3)) held by the taxpayer immediately after the
sale or acquired in the same taxable year. The manner and
amount of such reduction shall be determined under regulations
prescribed by the Secretary.
``(3) Basis.--For basis of property acquired on a sale or
exchange treated as an involuntary conversion under subsection
(a), see section 1033(b).
``(e) Recapture of Tax Benefit if Telecommunications Business
Resold Within 3 Years, etc.--
``(1) In general.--If, within 3 years after the date of any
qualified telecommunications sale, there is a recapture event
with respect to the property involved in such sale, then the
purchaser's tax imposed by this chapter for the taxable year in
which such event occurs shall be increased by an amount equal
to the product of--
``(A) the highest marginal rate of income tax
imposed on corporations under section 11, and
``(B) the lesser of--
``(i) the consideration furnished by the
purchaser in such sale, or
``(ii) the dollar amount specified in
subsection (b)(1)(A).
``(2) Exception for reinvested amounts.--Paragraph (1)
shall not apply to any recapture event which is a sale if--
``(A) the sale is a qualified telecommunications
sale, or
``(B) during the 60-day period beginning on the
date of such sale, the taxpayer is the purchaser in
another qualified telecommunications sale in which the consideration
furnished by the taxpayer is not less than the amount realized on the
recapture event sale.
``(3) Recapture event.--For purposes of this subsection,
the term `recapture event' means, with respect to any qualified
telecommunications sale--
``(A) any sale or other disposition of the assets,
stock, or partnership interest referred to in
subsection (c) which were acquired by the taxpayer in
such sale, and
``(B) in the case of a qualified telecommunications
sale described in paragraph (2) or (3) of subsection
(c)--
``(i) any sale or other disposition of a
telecommunications business by the corporation
or partnership referred to in such subsection,
or
``(ii) any other transaction which results
in the eligible purchaser ceasing to be an
eligible purchaser, or ceasing to have control
(as defined in subsection (c)(2)(A)) of such
corporation or ownership of an interest in such
partnership sufficient to satisfy the
requirements of subsection (c)(3)(A).
``(f) Definitions and Special Rules.--For purposes of this
section--
``(1) Eligible purchaser.--The term `eligible purchaser'
means--
``(A) any economically and socially disadvantaged
business, or
``(B) any corporation or partnership if immediately
following the purchase--
``(i) substantially all the assets of such
corporation or partnership are assets of 1 or
more telecommunications businesses, and
``(ii) the Telecommunications Development
Fund established under section 714 of the
Communications Act of 1934 (47 U.S.C. 614) or
any wholly-owned affiliate of such Fund owns at
least 5 percent of--
``(I) the stock in such
corporation,
``(II) the partnership interest in
such partnership, or
``(III) the indebtedness
convertible into such stock or
partnership interest.
``(2) Economically and socially disadvantaged business.--
The term `economically and socially disadvantaged business'
means a person which is designated by the Secretary as an
economically and socially disadvantaged business based on a
determination that such person--
``(A) meets the control requirements of paragraph
(6),
``(B) will be a telecommunications business after
the purchase for which the eligibility determination is
sought, and
``(C) before the purchase for which the eligibility
determination is sought does not have--
``(i) attributable ownership interest in
television broadcast stations having an
aggregate national audience reach of more than
5 percent as defined by the Federal
Communications Commission under section
73.3555(e)(2)(i) of title 47 of the Code of
Federal Regulations as in effect on January 1,
2001,
``(ii) attributable ownership interest in--
``(I) more than 50 radio stations
nationally, and
``(II) radio stations with a
combined market share exceeding 10
percent of radio advertising revenues
in the relevant market as defined by
the Federal Communications Commission,
or
``(iii) attributable ownership interest in
any other telecommunications business having
more than 5 percent of national subscribers of
their respective service.
``(3) Relevant market.--The term `relevant market' means
the local radio market served by the radio station or stations
being purchased.
``(4) Telecommunications business.--The term
`telecommunications business' means a business which, as its
primary purpose, engages in electronic communications and is
regulated by the Federal Communications Commission pursuant to
the Communications Act of 1934, including a cable system (as
defined in section 602(7) of such Act (47 U.S.C. 522(7))), a
radio station (as defined in section 3(35) of such Act (47
U.S.C. 153(35))), a broadcasting station providing television
service (as defined in section 3(49) of such Act (47 U.S.C.
153(49))), a provider of direct broadcast satellite service (as
defined in section 335(b)(5)(A) of such Act (47 U.S.C.
335(b)(5)(A))), a provider of video programming (as defined in
section 602(20) of such Act (47 U.S.C. 522(20))), a provider of
commercial mobile services (as defined in section 332(d)(1) of
such Act (47 U.S.C. 332(d)(1))), a telecommunications carrier
(as defined in section 3(44) of such Act (47 U.S.C. 153(44))),
a provider of fixed satellite service, a reseller of the
communications service or commercial mobile service, or a
provider of multichannel multipoint distribution service.
``(5) Purchase.--A taxpayer shall be considered to have
purchased a property if, but for subsection (d)(2) and the
application of section 1033(b), the basis of the property would
be its cost within the meaning of section 1012.
``(6) Control.--
``(A) Individuals.--For purposes of paragraph
(2)(A), an individual who meets the requirements of
paragraph (7) also meets the requirements of this
paragraph.
``(B) Entities.--For purposes of paragraph (2)(A),
an entity meets the requirement of this paragraph if
the requirements of subparagraphs (C), (D), or (E) are
satisfied.
``(C) 30-percent test.--The requirements of this
subparagraph are satisfied if--
``(i) with respect to any entity which is a
corporation, individuals who meet the
requirements of paragraph (7) collectively own
at least 30 percent in value of the outstanding
stock of the corporation, and more than 50
percent of the total combined voting power of
all classes of stock entitled to vote of the
corporation, and
``(ii) with respect to any entity which is
a partnership, individuals who meet the
requirements of paragraph (7) collectively own
at least 30 percent of the capital interests in
the partnership, a distributive share of at
least 30 percent of each item of the
partnership's income, gain, loss, deduction, or
credit, more than 50 percent of the total
combined voting power of all partnership
interests entitled to vote, and control over
the management of the partnership.
``(D) 15-percent test.--The requirements of this
subparagraph are satisfied if--
``(i) with respect to any entity which is a
corporation--
``(I) individuals who meet the
requirements of paragraph (7)
collectively own at least 15 percent in
value of the outstanding stock of the
corporation, and more than 50 percent
of the total combined voting power of
all classes of stock entitled to vote
of the corporation, and
``(II) no other person owns more
than 25 percent in value of the
outstanding stock of the corporation,
and
``(ii) with respect to any entity which is
a partnership--
``(I) individuals who meet the
requirements of paragraph (7)
collectively own at least 15 percent of
the capital interests in the
partnership, a distributive share of at
least 15 percent of each item of the
partnership's income, gain, loss,
deduction, or credit, more than 50
percent of the total combined voting
power of all classes of partnership
interests entitled to vote, and control
over the management of the partnership,
and
``(II) no other person owns more
than 25 percent of the capital
interests and profits interests in the
partnership or a distributive share of
more than 25 percent of any item of the
partnership's income, gain, loss,
deduction, or credit.
``(E) Publicly-traded corporation test.--The
requirements of this subparagraph are satisfied if,
with respect to a corporation the securities of which
are traded on an established securities market,
individuals who meet the requirements of paragraph (7)
collectively own more than 50 percent of the total
combined voting power of all classes of stock entitled
to vote of the corporation.
``(F) Restrictions on agreements concerning voting
of stock or partnership interests.--For purposes of
satisfying the requirements of subparagraph (C), (D),
or (E), the stock or partnership interest relied upon
to establish compliance shall not be subject to any
agreement, arrangement, or understanding which provides
for, or relates to, the voting of the stock or
partnership interest in any manner by, or at the
direction of, any person other than an eligible
individual who meets the requirements of paragraph (7),
or the right of any person other than 1 of those
individuals to acquire the voting power through
purchase of shares, partnership interests, or
otherwise.
``(G) Constructive ownership.--In applying
subparagraphs (C), (D), (E), and (F), the constructive
ownership rules of section 318 shall apply, but only if
the interests for which constructive ownership is
claimed are not owned, directly or indirectly, by
individuals who do not meet the requirements of
paragraph (7).
``(7) Individuals.--An individual meets the requirements of
this paragraph if such individual is--
``(A) a United States citizen, and
``(B) a member of an economically or socially
disadvantaged class determined by the Secretary to be
underrepresented in the ownership of the relevant telecommunications
business.''.
(b) Conforming Amendments.--
(1) Sections 1245(b)(5) and 1250(d)(5) of the Internal
Revenue Code of 1986 are each amended--
(A) by inserting ``section 1071 (relating to
certain sales of telecommunications businesses) or''
before section 1081'', and
(B) by inserting ``and 1071'' before ``1081'' in
the heading thereof.
(2) The table of parts for subchapter O of chapter 1 of
such Code is amended by inserting after the item relating to
part IV the following new item:
``Part V. Certain sales of telecommunications businesses.''.
(c) Effective Date.--The amendments made by this section shall
apply to elections made with respect to any sale on or after the date
of the enactment of this Act.
SEC. 4. TELECOMMUNICATIONS BUSINESS CREDIT.
(a) In General.--Subpart E of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to rules for computing
investment credit) is amended by inserting after section 48 the
following new section:
``SEC. 48A. TELECOMMUNICATIONS BUSINESS CREDIT.
``For purposes of section 46, there is allowed as a credit against
the tax imposed by this chapter for any taxable year an amount equal to
10 percent of the taxable income of any taxpayer which at all times
during such taxable year--
``(1) is a local exchange carrier (as defined in section
3(26) of the Communications Act of 1934 (47 U.S.C. 153(26))),
``(2) is not a Bell operating company (as defined in
section 3(4) of such Act (47 U.S.C. 153(4))), and
``(3) is headquartered in an area designated as an
empowerment zone by the Secretary of Housing and Urban
Development.''.
(b) Transitional Rule.--Section 39(d) of the Internal Revenue Code
of 1986 (relating to transitional rules) is amended by adding at the
end the following new paragraph:
``(11) No carryback of section 48a credit before effective
date.--No portion of the unused business credit for any taxable
year which is attributable to the telecommunications business
credit determined under section 48A may be carried back to a
taxable year ending on or before the date of the enactment of
section 48A.''.
(c) Conforming Amendments.--
(1) Section 46 of the Internal Revenue Code of 1986
(relating to amount of credit) is amended by striking ``and''
at the end of paragraph (2), by striking the period at the end
of paragraph (3) and inserting ``, and'', and by adding at the
end the following new paragraph:
``(4) the telecommunications business credit.''.
(2) The table of sections for subpart E of part IV of
subchapter A of chapter 1 of such Code is amended by inserting
after the item relating to section 48 the following new item:
``48A. Telecommunications business credit.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years ending after the date of the enactment of this
Act.
SEC. 5. EXCLUSION OF 50 PERCENT OF GAIN.
(a) In General.--Section 1202 of the Internal Revenue Code of 1986
(relating to partial exclusion for gain from certain small business
stock) is amended--
(1) by adding at the end of subsection (a) the following
new paragraph:
``(3) Certain telecommunications investments by
corporations and investment companies.--Gross income shall not
include 50 percent of any gain from the sale or exchange of
stock in an eligible purchaser (as defined in section
1071(f)(1)), engaged in a telecommunications business (as
defined in section 1071(f)(4)) held for more than 5 years.'',
(2) by striking subparagraphs (A) and (B) of subsection
(b)(1) and inserting the following new subparagraphs:
``(A) in the case of gain from the sale or exchange
of qualified small business stock held for more than 5
years--
``(i) $10,000,000 reduced by the aggregate
amount of eligible gain taken into account by
the taxpayer under subsection (a) for prior
taxable years attributable to dispositions of
stock issued by such corporation, or
``(ii) 10 times the aggregate adjusted
bases of qualified small business stock issued
by such corporation and disposed of by the
taxpayer during the taxable year, and
``(B) in the case of gain from the sale or exchange
of stock in an eligible purchaser engaged in a
telecommunications business for more than 5 years--
``(i) $20,000,000 reduced by the aggregate
amount of eligible gain taken into account by
the taxpayer under subsection (a) for prior
taxable years attributable to dispositions of
stock issued by an eligible purchaser engaged
in a telecommunications business, or
``(ii) 15 times the aggregate adjusted
bases of stock of an eligible purchaser engaged
in a telecommunications business issued by such
eligible purchaser and disposed of by the
taxpayer during the taxable year.'',
(3) by striking ``subparagraph (B)'' in the last sentence
of subsection (b)(1) and inserting ``subparagraphs (A)(ii) and
(B)(ii)'',
(4) by striking ``years.'' in subsection (b)(2) and
inserting ``years or any gain from the sale or exchange of
stock in an eligible purchaser engaged in a telecommunications
business held for more than 5 years.'', and
(5) by striking the period at the end of subsection
(b)(3)(A) and inserting ``, and paragraph (1)(B) shall be
applied by substituting `$10,000,000' for `$20,000,000'.''.
(b) Effective Date.--The amendments made by this section shall
apply to sales on or after the date of the enactment of this Act.
SEC. 6. TECHNICAL AND CONFORMING AMENDMENTS; REGULATIONS.
(a) Technical and Conforming Amendments.--The Secretary of the
Treasury shall, not later than 150 days after the date of the enactment
of this Act, submit to the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the Senate, a draft of
any technical and conforming amendments of the Internal Revenue Code of
1986 which are necessary to reflect throughout such Code the amendments
made by this Act.
(b) Regulations.--The Secretary of the Treasury, in consultation
with the Federal Communications Commission, shall promulgate
regulations to implement the amendments made by this Act not later than
90 days after the date of the enactment of this Act. The regulations
shall provide for the determination by the Secretary of the Treasury as
to whether an applicant is an ``eligible purchaser'' as defined in
section 1071(f) of the Internal Revenue Code of 1986 (as added by
section 3(a)). The regulations shall further provide that such
determinations of eligibility shall be made not later than 45 calendar
days after an application is filed with the Secretary of the Treasury.
The regulations implementing section 1071(f)(7) of such Code (as added
by section 3) shall be updated on an ongoing basis not less frequently
than every 5 years.
SEC. 7. BIENNIAL PROGRAM AUDITS BY GAO.
Not later than January 1, 2005, and not later than 2 years
thereafter, the Comptroller General of the United States shall audit
the administration of the sections of the Internal Revenue Code of 1986
added or amended by this Act, and issue a report on the results of that
audit. The Comptroller General shall include in the report,
notwithstanding any provision of section 6103 of the Internal Revenue
Code of 1986 to the contrary--
(1) a list of eligible purchasers (as defined in section
1071(f)(1) of such Code) and any other taxpayer receiving a
benefit from the operation of section 48A or 1202 of such Code
as such section was added or amended by this Act, and
(2) an assessment of the effect the amendments made by this
Act have on increasing new entry and growth in the
telecommunications industry by economically and socially
disadvantaged businesses, and the effect of this Act on
enhancing the competitiveness of the telecommunications
industry.
<all>