Congress Passes Gulf Zone Bill

Congress has passed an $8 billion tax bill that provides special incentives to help revitalize and rebuild communities in the Gulf Coast states devastated by hurricanes Katrina and Rita.The bill (H.R. 4440) creates a Gulf Opportunity Zone where states and municipalities can issue tax-exempt bonds to finance commercial and residential projects. One provision allows state and local governments to use mortgage revenue bonds to finance low-interest loans so that individuals whose homes were destroyed can purchase a new home in the disaster area. Homeowners also can obtain low-interest loans of up to $150,000 to repair damaged homes. The bill includes an additional $1.1 billion in low-income housing tax credits for Louisiana, Mississippi, and Alabama and $1 billion in New Markets Tax Credit authority. The GO Zone Act will allow Louisiana to "issue bonds to build housing, roads, bridges, and industrial plants," Sen. Mary Landrieu, D-La. said. Other provisions provide tax incentives for businesses to rebuild in the GO Zone and tax relief for hurricane victims.