On November 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act (H.R. 3684) making it law. H.R. 3684 modifies Section 142 of the Internal Revenue Code to allow “qualified broadband projects” and “qualified carbon dioxide capture facilities” to be financed with private activity bonds. In summary, for a qualified broadband project, the issuer must provide notice to each broadband service provider in the area within which broadband services are to be provided and give at least ninety days to respond. A qualified broadband project is defined as a project which is designed to provide service solely to one or more census block groups in which more than 50 percent of residential households do not have access to fixed, terrestrial broadband service which delivers at least 25 megabits per second downstream and at least three megabits service upstream, and results in internet access to residential locations, commercial locations or a combination of both at speeds not less than 100 megabits per second for downloads and 20 megabits per second for uploads, but only if at least 90 percent of the locations where access is to be provided are locations where a broadband service provider did not provide service before the project or did not provide service meeting the minimum speed requirements described above.
Qualified Carbon Dioxide Capture Facility is defined as the eligible components of an industrial dioxide facility and direct air capture facility. Equipment installed in an industrial carbon dioxide facility used for the purpose of capture, treatment and purification, compression, transportation, or onsite storage of carbon dioxide produced by the industrial carbon dioxide facility or integral or functionally related and subordinate to a process which converts a solid or liquid product from coal, petroleum residue, biomass or other materials recovered for their energy or feedstock value into a synthesis gas composed primarily of carbon dioxide and hydrogen for direct use or subsequent chemical or physical conversion should qualify, generally. The Infrastructure Investment and Jobs Act also increases the national limitation for qualified highway or surface freight transportation facilities to $30,000,000,000 as well as provides a partial exception for volume cap for qualified broadband projects.
Victoria S. Byerly is an attorney in KAV’s Public Finance Group. A specialist in Section 103 of the Internal Revenue Code, her practice is exclusively dedicated to state and federal tax matters related to the issuance of tax-exempt debt obligations.