12 2 STA T . 1 507PUBLIC LA W 110 – 2 34—M A Y 22 , 200 8theda te ofis s u a nc e .S uch te rm sha l l include an y e x ten - sion of such p eriod under clause ( iii ) . ‘ ‘(iii) EXTENSIO NO FP E R IO D . —U pon su b mission of are q uest prior to the expiration of the expenditure period (determined w ithout re g ard to any extension under this clause) , the Secretary may extend such period if the issuer establishes that the failure to expend the proceeds within the original expenditure period is due to reasonable cause and the expenditures for qualified purposes will continue to proceed with due diligence. ‘‘( C ) QUAL IFIED PURPOSE.— F or purposes of this para- graph, the term ‘qualified purpose ’ means a purpose speci- fied in section 54B (e). ‘‘( D ) R EI MB URSEMENT.—For purposes of this subtitle, a v ailable pro j ect proceeds of an issue shall be treated as spent for a qualified purpose if such proceeds are used to reimburse the issuer for amounts paid for a qualified purpose after the date that the Secretary ma k es an alloca- tion of bond limitation with respect to such issue, but only if— ‘‘(i) prior to the payment of the original expendi- ture, the issuer declared its intent to reimburse such expenditure with the proceeds of a qualified tax credit bond, ‘‘(ii) not later than 60 days after payment of the original expenditure, the issuer adopts an official intent to reimburse the original expenditure with such pro- ceeds, and ‘‘(iii) the reimbursement is made not later than 18 months after the date the original expenditure is paid. ‘‘( 3 ) REPORTIN G .— A n issue shall be treated as meeting the requirements of this paragraph if the issuer of qualified tax credit bonds submits reports similar to the reports required under section 14 9 (e). ‘‘(4) SPE C IAL RULES RELATING TO ARBITRAGE.— ‘‘(A) I N GENERAL.—An issue shall be treated as meeting the requirements of this paragraph if the issuer satisfies the requirements of section 148 with respect to the proceeds of the issue. ‘‘(B) SPECIAL RULE FOR IN V ESTMENTS DURING EXPENDI- TURE PERIOD.—An issue shall not be treated as failing to meet the requirements of subparagraph (A) by reason of any investment of available project proceeds during the expenditure period. ‘‘(C) SPECIAL RULE FOR RESERVE FUNDS.—An issue shall not be treated as failing to meet the requirements of subparagraph (A) by reason of any fund which is expected to be used to repay such issue if— ‘‘(i) such fund is funded at a rate not more rapid than equal annual installments, ‘‘(ii) such fund is funded in a manner reasonably expected to result in an amount not greater than an amount necessary to repay the issue, and
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