Tax-Exempt Bond Incentives For Private Entities In The Heartland: Disaster Tax Relief Act Of 2008

The Heartland Disaster Tax Relief Act of 2008 (the

"Act") was signed into law as part of the Emergency

Economic Stabilization Act of 2008 on October 3, 2008. The Act

provides temporary tax relief for areas in the Midwestern Disaster

Area similar to the relief given to areas impacted by Hurricane

Katrina in 2005.

The Midwestern Disaster Area includes certain counties within

the states of Arkansas, Illinois, Iowa, Indiana, Missouri, Nebraska

and Wisconsin (Kansas, Michigan and Minnesota are included in the

Act but do not qualify for issuance of the bonds described herein)

that were declared major disaster areas by the President on or

after May 20, 2008 and before August 1, 2008 by reason of the

severe storms, tornados or flooding (the "Disaster

Events"). Maps of the portions of the Midwestern Disaster Area

which qualify for such bonds (areas shown in red, light orange or

orange) are below.





Missouri (first Disaster Declaration)

Missouri (second Disaster Declaration)



Qualified Midwestern Disaster Area Bonds

Among other tax benefits to assist individuals and businesses

affected by the Disaster Events, the Act provides for the issuance

of a new category of tax-exempt Midwestern Disaster Area Bonds

("Bonds") for certain multi-family rental projects,

nonresidential real property, public utility property, and

principal residences as described below:

Proceeds of the Bonds may be used to finance (a) the cost of a

multifamily rental project for low and moderate income individuals,

under relaxed tenant income limitations described below, (b) the

cost of acquisition, construction, reconstruction or renovation of

nonresidential real property (including fixed improvements

associated with such property) or (c) the cost to repair or

reconstruct public utility property, if, in each case, (i) the

person using the property suffered a loss in a trade or business

attributable to the Disaster Events, or (ii) the cost is incurred

by a person designated by the Governor of the State in which the

project is located as a person carrying on a trade or business

replacing a trade or business with respect to which another person

suffered such a loss. Bonds also may be issued to provide financing

for mortgagors who suffered damages to their principal residences

attributable to the Disaster Events.

Bonds may be used to finance certain nonresidential real

property projects, including (subject to the existence of state


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