102 STAT. 3540 PUBLIC LAW 100-647—NOV. 10, 1988

treated (at the election of the issuer) as 1 issue for purposes of
the preceding sentence if no bond which is part of any issue in
such series has a maturity of more than 270 days or is a private
activity bond."

(16XA) Subclause CD of section 148(fX4XBXiii) of the 1986 Code
(relating to safe harbor for determining when proceeds of tax or
revenue anticipation bonds are expended) is amended by strik-
ing out "aggregate face amount of such issue" and inserting in
lieu thereof "proceeds of such issue".

26 USC148 note. (B) The amendment made by subparagraph (A) shall apply to

bonds issued after June 30,1987.

(17XA) Subparagraph (C) of section 148(fX4) of the 1986 Code is
amended—

(i) by striking out the heading and inserting in lieu
thereof:
"(C) EXCEPTION FOR GOVERNMENTAL UNITS ISSUING

$5,000,000 OH LESS OF BONDS.—
"(i) IN GENERAL.—",

(ii) by redesignating clauses (i) through (iv) as subclauses
(D through (TV), respectively, and moving the margins of
such subclauses 2 ems to the right, and

(iii) by striking out the last sentence and inserting in lieu
thereof the following new clauses:

"(ii) AGGREGATION OF ISSUERS.—For purposes of
subclause (IV) of clause (i)—

"CD an issuer and all entities which issue bonds
on behalf of such issuer shall be treated as 1 issuer,
"CO) all bonds issued by a subordinate entity
shall, for purposes of applying such subclause to
each other entity to which such entity is subordi-
nate, be treated as issued by such other entity, and
"(HI) an entity formed (or, to the extent provided
by the Secretary, availed of) to avoid the purposes
of such subclause (TV) and all other entities bene-
fiting thereby shall be treated as 1 issuer,
"(iii) CERTAIN REFUNDING BONDS NOT TAKEN INTO AC-
COUNT IN DETERMINING SMALL ISSUER STATUS.—There

shall not be taken into account under subclause (TV) of
clause (i) any bond issued to refund (other than to
advance refund) any bond to the extent the amount of
the refunding bond does not exceed the outstanding
amount of the refunded bond.

"(iv) CERTAIN ISSUES ISSUED BY SUBORDINATE GOVERN-
MENTAL UNITS, ETC., EXEMPT FROM REBATE REQUIRE-
MENT.—An issue issued by a subordinate entity of a
governmental unit with general taxing powers shall be
treated as described in clause (iXD if the aggregate face
amount of such issue does not exceed the lesser of—
"(I) $5,000,000, or

"(II) the amount which, when added to the aggre-
gate face amount of other issues issued by such
entity, does not exceed the portion of the $5,000,000
limitation under clause (iXTV) which such govern-
mental unit allocates to such entity.
For purposes of the preceding sentence, an entity
which issues bonds on behalf of a governmental unit
with general taxing powers shall be treated as a