SECTION 7. VOLUME

CAP ALLOCATIONS AND METHODOLOGY

a. First Allocation . Tribal Economic Development Bond volume cap under § 7871(f) will be allocated in at least two tranches. The first $1 billion in volume cap will be allocated in accordance with this section for qualified projects for which Applications meeting the requirements of this notice have been filed with the IRS on or before the First Allocation Deadline. If the total amount of volume cap requested in all applications received on or before the First Allocation Deadline does not exceed $1 billion then each qualified project will be allocated the amount of volume cap requested, and any amount of the first $1 billion in volume cap remaining will be available for allocation as part of the Second Allocation. If the total amount of volume cap requested in all applications received on or before the First Allocation Deadline exceeds $1 billion, than each qualified project will be allocated the amount of volume cap requested reduced pro rata such that the total amount allocated as part of the First Allocation does not exceed $1 billion. Applicants

receive an allocation from the remaining volume cap (“Second Allocation”), an Application must be filed with the IRS after August 15, 2009, and on or before January 1, 2010 (“Second Allocation Deadline”). See section 7 for further discussion of the two allocations.

f. Project description . Each Application must contain the information required by this subsection f.

(i) Qualified project . Each Application must describe in reasonable detail the project to be financed with the proceeds of the Tribal Economic Development Bonds. The Application must indicate the expected date that the acquisition and construction of the project will commence and the expected date that the project will be placed in service.

(ii) Location of project . The Application must include a certification that the project’s location is within the Indian tribal government’s reservation.

(iii) Project not used for gaming pur- poses . The Application must contain a certification that no portion of the proceeds of any Tribal Economic Development Bonds issued pursuant to the application will be used to finance any portion of a building in which class II or class III gaming, as defined in section 4 of the Indian Gaming Regulatory Act, is conducted or housed, or any other property actually used in the conduct of such gaming. For a safe harbor standard regarding certain determinations with respect to separate buildings, see section 10 of this notice.

(iv) Regulatory approvals . The Application must state whether all necessary Federal, State and local regulatory approvals for the project have been obtained and, if those approvals have not yet been obtained, the Application must describe the Indian tribal government’s plan for obtaining them and the time frame during which the Indian tribal government expects to receive them.

g. Plan of financing . The Application must contain (1) a reasonably detailed description of the plan of financing for the project, including all reasonably expected sources ( e.g., a public offering through a named underwriter or a private placement to a named institution) and uses of financing, including financing from the Tribal Economic Development Bonds and from other sources, (2) the status of all financing, including the name and addresses of

all entities expected to provide any financing, (3) the anticipated date of issuance of the Tribal Economic Development Bonds and any expected purchasers of the Tribal Economic Development Bonds, (4) the sources of security and repayment for the Tribal Economic Development Bonds, (5) the aggregate face amount of Tribal Economic Development Bonds expected to be issued for the project, and (6) the issuer’s reasonably expected schedule for spending proceeds of the Tribal Economic Development Bonds. If the Indian tribal government intends to use the proceeds of Tribal Economic Development Bonds to reimburse amounts paid with respect to a qualified project, the Application must demonstrate that the requirements under § 1.150–2 of the Income Tax Regulations will be met.

h. Dollar amount of allocation re- quested . The Application must specify the dollar amount of the volume cap requested for the project.

i. Statement of readiness to issue . An Application for an allocation of volume cap from the First Allocation must contain the statement that the issuer reasonably expects to issue any Tribal Economic Development Bonds, pursuant to the requested allocation of volume cap, on or before December 31, 2010. An Application for an allocation of volume cap from the Second Allocation must contain a statement that the issuer reasonably expects to issue any Tribal Economic Development Bonds pursuant to the requested allocation of volume cap on or before December 31, 2011.