2005 North Carolina Code - General Statutes § 115C-489.5. Qualified zone academy bonds; findings.

Article 34B.

Qualified Zone Academy Bonds.

§ 115C‑489.5.  Qualified zone academy bonds; findings.

The General Assembly finds:

(1)       Section 226 of the Taxpayer Relief Act of 1997, as codified at 26 U.S.C. § 1397E, provides funds for school improvements through taxable qualified zone academy bonds. Ninety‑five percent (95%) or more of the proceeds of a qualified zone academy bond issue must be used for a qualified purpose with respect to a qualified zone academy established by an eligible local education agency.

(2)       Partnerships between private entities and local schools are promoted through the use of qualified zone academy bonds. Issuers must certify that they have received written commitments from one or more private entities to make qualified contributions valued at ten percent (10%) of the proceeds of the issue.

(3)       Eligible taxpayers may receive federal tax credits for holding the qualified zone academy bonds. It is intended that the qualified zone academy bonds be sold at par value so that the tax credits received are instead of interest that otherwise would have been paid on the bonds. Therefore, issuers of qualified zone academy bonds are obligated to repay the principal amount of the qualified zone academy bonds but need not make interest payments.

(4)       Applicable federal law limits the amount of qualified zone academy bonds that may be issued in North Carolina in a calendar year. (2000‑69, s. 1.)