SECTION 5. PROCEDURE FOR

NONREVIEWABLE RULINGS

.01 Issuer or Holder Must Submit Request . A request for a nonreviewable ruling must be submitted by an issuer or holder. The term ‘‘issuer’’ includes any state, any political subdivision of a state, and any corporation described in § 150(d). It also includes any ‘‘onbehalf-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-behalf-of 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.

Other parties may join an issuer or holder in requesting a ruling. For example, an underwriter that is not a holder may join an issuer in requesting a nonreviewable ruling but may not by itself request a ruling. However, the Service may rule in accordance with the methodology and procedure indicated in § 9(f) of the Pacific Northwest Electric Power Planning and Conservation Act (16 U.S.C. 839).

.02 Specific Transaction . The Service generally rules only on specific transactions. Thus, a request for a nonreviewable ruling must address a specific proposal to issue obligations or a specific proposed transaction that may affect the application of §§ 103, 141 through 150, 1394, or 7871(c) to obligations already issued.

.03 Prospective Obligations . The Service may issue a nonreviewable ruling on whether a proposed obligation meets one or more conditions for the exclusion of interest on the obligation from gross income under § 103. Before the request is submitted, a resolution must have been adopted in accordance with state or local law authorizing the issuance of the obligation that is the subject of the ruling request. Among other things, the resolution may state that the issuance of obligations is contingent upon a favorable ruling by the Service.

.04 Outstanding Obligations . (1) Whether an outstanding obliga- tion meets conditions under § 103 . The Service will not issue a nonreviewable ruling on whether an issued and outstanding obligation that is part of an issue of obligations meets one or more conditions for the exclusion of interest on the obligation from gross income under § 103 unless the request is received by the Service before interest on any obligation in that issue is required to be reported by a holder.

(2) Transactions affecting outstand- ing obligations . The Service may issue a nonreviewable ruling on the effect of a proposed act or transaction on one or more conditions for the exclusion from gross income under § 103 of interest on an issued and outstanding obligation. The request, however, must contain a statement by the issuer that the outstanding obligation has met the conditions for the exclusion of interest under § 103 from the issue date to the date the request is submitted.

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.05 Status Rulings . The Service will not issue a nonreviewable ruling under this procedure on the status or classification of an issuer of obligations unless the status or classification of the issuer affects the exclusion of interest under § 103 on a specific, prospective issue of obligations.

.06 Statement of Facts . Although a request for a nonreviewable ruling may address only one or a few of the conditions for exclusion under § 103, the requester should describe the entire transaction in the request. The requester should consider submitting the following information in complying with the procedures set forth in Rev. Proc. 96–1 for submitting requests:

(1) the name, address, and taxpayer identification number of the issuer, each underwriter, each conduit borrower (except conduit borrowers of the proceeds of bonds such as qualified mortgage bonds, qualified veterans’ mortgage bonds, and qualified student loan bonds);

(2) a description of all uses and users of proceeds of the obligations;

(3) a description of the accounting method or methods that have been or will be used to account for investments and expenditures of gross proceeds of the obligations, including refunding obligations;

(4) an accounting of all fees that will be paid in connection with the issuance of the obligations;

(5) for outstanding obligations, including refunded obligations, the actual principal amount, actual issue price, actual issue date, and actual yield of the obligations and investments;

(6) for prospective obligations, the expected principal amount, expected yield, expected issue price, and expected issue date of the prospective obligations and of the expected investments to be acquired with bond proceeds;

(7) descriptions of any obligations that have been or will be refunded and representations whether the interest on each obligation that has been or will be refunded has been treated by the issuer as excludable from gross income under § 103;

(8) a statement whether the issuer has received an appropriate allocation of volume cap under § 146; and

(9) a description of any elections made pursuant to the regulations under § 148, including elections on the application of the various versions of those regulations.

.07 Supporting Documentation . The requester should consider submitting copies of the following documents in complying with the procedures set forth in Rev. Proc. 96–1 for submitting requests:

(1) the resolution, official statement, and trust indenture;

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

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

(4) copies of relevant provisions of local law.

.08 Acknowledgement . The request for a nonreviewable ruling must be accompanied by a written statement acknowledging that the request does not comply with the requirements of section 4 of this procedure and that compliance with the provisions of section 4 of this procedure is mandatory for a ruling subject to review by

the Tax Court under § 7478. The acknowledgement must be in the form set forth in Appendix B.