SECTION 4. PROCEDURE FOR

REVIEWABLE RULINGS

.01 Issuer Must Submit Request . A request for a reviewable ruling must be submitted by the prospective issuer. The term ‘‘issuer’’ includes any state, any political subdivision of a state, and any corporation described in § 150(d). It also includes any ‘‘on-behalf-of’’ issuer described in Rev. Rul. 63–20, 1963–1 C.B. 24, and any constituted authority described in Rev. Rul. 57– 187, 1957–1 C.B. 65, if the on-behalfof issuer or constituted authority has been designated by a state or political subdivision to issue the prospective obligations. It does not include a conduit borrower of the proceeds of the prospective obligations.

.02 Specific Prospective Issuance of Obligations . A request for a reviewable

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substantially comply with section 4 of this revenue procedure, the Service will immediately close the request. The Service will also send written notice to the issuer, or its authorized representative, stating that the request has been closed and stating the specific nature of the defects. If a request for a reviewable ruling is closed because it is does not substantially comply with section 4 of this revenue procedure, the issuer has failed to have timely taken all reasonable steps to secure a ruling subject to review by the Tax Court.

.11 Additional information . If additional information is not received within 14 days of the date the Service requests it, the request will be closed, and the issuer will have failed to have timely taken all reasonable steps to secure a ruling subject to review by the Tax Court. Once a request is closed, the issuer must submit a new request, and pay an additional fee, if it wishes to request a reviewable or nonreviewable ruling. If the new request is submitted not later than 30 days after the request is closed, the new request may incorporate the information and documents already submitted. To do so, the issuer must clearly state in writing that it is submitting a new request and incorporating by reference previously submitted materials.

.12 Taxpayer conferences . (1) Taxpayer conference is a step in securing a ruling . Taxpayer conferences ensure that the requester fully participates in the processing of a request for a ruling and that the Service fully understands the requester’s position. Thus, if an issuer has been notified of a tentative adverse position by the Service and does not participate in the conference, the issuer has failed to have timely taken all reasonable steps to secure a ruling subject to review by the Tax Court. After the first conference, the issuer need not participate in any additional conference offered by the Service under Rev. Proc. 96–1. (2) Location of conference . The conference generally will be held at the National Office. The issuer, however, may request in writing that the conference be held by telephone.

(3) Conference report . If the Service prepares a conference report, a copy will be sent to the issuer. The issuer will have 14 calendar days to correct any factual errors made in the report. If the Service does not receive corrections

(9) a representation whether the issuer has received an appropriate allocation of volume cap under § 146 for the prospective obligations.

.04 Supporting Documentation . Rulings are based on the documents that are submitted. The initial request for a reviewable ruling, and any additional submission at a later date, must be accompanied by copies of all documentation that is relevant to the determination whether interest on the prospective obligations will be excludable from gross income under § 103. If the prospective obligations are refunding obligations, the documentation must also include the relevant documents underlying the refunded obligations. The request must include a representation that each document accompanying the request is a complete and accurate copy of the original document. The documents to be submitted include—

(1) the resolution for the issuance of the obligations;

(2) management and service contracts, leases, output contracts, and agreements that affect any facility financed with the proceeds from the obligations;

(3) the official statement and trust indenture;

(4) the arbitrage certificate and other documents containing covenants about arbitrage rebate and about subsequent intentional acts to earn arbitrage; and

(5) any relevant provision of state or local law.

.05 Cross-references . Relevant provisions in submitted documents must be appropriately described, analyzed, and cross-referenced in the request for a reviewable ruling.

.06 Legal Analysis . A request for a reviewable ruling must set forth a complete and detailed analysis of the rationale on which the requester relies to support its request for a determination that each condition for exclusion of interest on the prospective obligations under § 103 will be satisfied. The analysis submitted must include citations to the Code, regulations, revenue rulings, revenue procedures, judicial authority, and any other authority relevant to the issues raised by the request. A simple statement that a provision of the Code is satisfied is insufficient. The request must also describe in detail any relevant provision of state or local law. The following is a recommended format for the legal analysis:

(1) Whether the obligations will be issued by or on behalf of a state or political subdivision of a state;

(2) Whether the obligations will be private activity bonds under § 141;

(3) Whether the obligations will satisfy each of the provisions of §§ 142 through 147;

(4) Whether the obligations will be arbitrage bonds under § 148;

(5) Whether the obligations will satisfy the requirements of § 149;

(6) Whether the obligations will satisfy the requirements of § 150;

(7) Whether the obligations satisfy any other requirements for the exclusion of interest under § 103.

.07 Acknowledgement . The request for a ruling must be accompanied by a statement, signed by the issuer, acknowledging that the issuer is aware that it cannot exhaust its administrative remedies unless it complies with section 4 of this revenue procedure. Appendix A sets forth a form for this acknowledgement.

.08 Number of Copies . Three copies must be submitted of the initial submission and of each additional submission, including the statement of facts, legal analysis, supporting documents, crossreferenced documents, and acknowledgement.

.09 Time Periods . The 180-day period specified in § 7478 begins as of the date the Service receives the initial request for a ruling. To ensure a sufficient amount of time to properly process a ruling request within this 180-day period, all time periods specified by Rev. Proc. 96–1 for processing a ruling request are 14 days for purposes of processing a ruling request under this procedure. The Service may grant extensions of these 14-day periods in accordance with the procedures set forth in Rev. Proc. 96–1 for extending the time period for additional information.

.10 Substantial compliance of initial request . If the initial request for a reviewable ruling substantially complies with section 4 of this revenue procedure, the Service will send a written notice of initial compliance. If a request for a reviewable ruling has only minor deficiencies, the deficiencies may be corrected in the same manner that additional information is provided under section 4.11 of this revenue procedure. If the initial request for a reviewable ruling does not

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within the 14-day period, it may base its ruling on the facts stated in the report. The Service may grant extensions of the 14-day period in accordance with the procedures set forth in Rev. Proc. 96–1 for extending the scheduling of conferences. The conference report may be included in the administrative record filed with the Tax Court.

.13 Withdrawal of Requests . Any withdrawal of a request for a reviewable ruling must be made in a written statement signed by the issuer. The statement must contain an acknowledgment that the issuer has not taken all reasonable steps to secure a reviewable ruling. If a request is not withdrawn in the manner described in this paragraph, the Service will continue to process the request and may issue a ruling.

.14 Exhaustion of Administrative Remedies .

(1) Compliance With Procedures Required . The issuer must comply with the procedures described in Rev. Proc. 96–1 and in section 4 of this revenue procedure in order to have reasonably taken all steps necessary to obtain a ruling that is subject to review by the Tax Court.

(2) Each Issuer Must Exhaust Its Remedies . An issuer that petitions the Tax Court must itself have exhausted administrative remedies for each request for a ruling. It may not base its petition on the response to any other request for a letter ruling that it submits or that is submitted by another issuer or other person.