SECTION 4. GENERAL

ALLOCATION PROCESS

a. Priority of Allocations . Except as otherwise provided in this section 4, for Applications filed with the IRS that meet the requirements in this notice, the IRS will allocate an amount of available vol

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riod. For purposes of this limitation, an Indian tribal government includes the Indian tribal government, together with any political subdivisions of the Indian tribal government, and any entities controlled by the Indian tribal government. An Application that requests an allocation of volume cap in an amount that would cause the Published Volume Cap Limit in effect on the date of submission to be exceeded will be treated as incomplete until the day the Applicant supplements the Application in a manner that complies with the requirements of the notice and does not cause such limit to be exceeded.

d. Available volume cap limitation . The IRS will not make an allocation that would cause the total amount of volume cap allocated (not including forfeited allocations) to exceed the $2 billion statutory limit for Tribal Economic Development Bonds. In general, if the total amount of volume cap requested in an Application meeting the requirements of this notice exceeds the amount of available volume cap on the submission date (determined by the IRS based on available information, including allocation data and reports of bonds issued), then the Applicant will have the opportunity to receive a portion of the available volume cap. Further, if two or more Applications meeting the requirements of this notice are filed on the same submission date and the amount of available volume cap on that date is less than the total amount of requested volume cap under those Applications, then each Applicant will be given the opportunity to receive a portion of the available volume cap in proportion to their requested amount of volume cap. In any circumstance in which available volume cap is in an amount less than the amount requested, the IRS will notify the Applicant and the Applicant will be provided 30 days to notify the IRS (at the address specified in section 3.d. of this notice) of its decision to accept the allocation in the lesser amount or to delay the allocation for up to 180 days from the submission date to determine if future forfeitures of volume cap may allow the Applicant to receive the full amount requested.

If the Applicant decides to delay receiving its allocation, it will also notify the IRS of whether it will accept a lesser allocation if forfeitures of volume cap during the delay period are insufficient to allow the Applicant to receive the full amount requested. If the Applicant does not notify the IRS of its decision within 30 days of such IRS’ notice to the Applicant, the Application will be treated as withdrawn. In any circumstance in which an allocation of volume cap may be in an amount less than the amount requested, the IRS may require the Applicant to supplement the Application to demonstrate that the requirements of this notice are satisfied if based on an Application for the reduced allocation.

e. Section 17 corporations, subdivi- sions of Indian tribal governments, and pool bond issuers .

(1) For purposes of issuing proposed Tribal Economic Development Bonds, an Applicant that receives an allocation may assign the allocation to an Indian tribal corporation organized under section 17 of the Indian Reorganization Act of 1934, 25 U.S.C. section 477 (2012) (a Section 17 Corporation), ¹ or to a subdivision of the Indian tribal government that satisfies the requirements of § 7871(d) to be treated as a political subdivision of a State, provided the assignment and use of the allocation conforms in all respects (other than with respect to the issuer of the bonds) to the Application of the assigning Applicant.

(2) An Applicant that receives an allocation may assign the allocation to a pool bond issuer to issue the proposed bonds provided that the proceeds of the proposed bonds are then loaned to the Applicant and provided that the pool bond issuer is itself an Indian tribal government, a subdivision of an Indian tribal government that satisfies the requirements of § 7871(d) for treatment as a political subdivision of a State, or a Section 17 Corporation. Pooled Tribal Economic Development Bonds will be subject to the provisions of § 149(f).

(3) Any bonds issued by a subdivision of an Indian tribal government, a Section 17 Corporation, or a pool bond issuer will be treated for purposes of a volume cap

allocation as if they were bonds issued by Applicant. Allocations will not be made to a pool bond issuer.

(4) The allocation limit of section 4.c. of this notice for any one Indian tribal government applies to the Applicant without regard to how the proposed bonds are issued ( i.e., whether the issuer is a subdivision of an Indian tribal government, a Section 17 Corporation, or a pool bond issuer).

f. Confirmation of allocation . The IRS will send the Applicant that receives a volume cap allocation a letter confirming the allocation (allocation letter).

g. Expiration of allocation . Applicants have 180 days from the date of the allocation letter to issue the proposed bonds. To the extent that the proposed bonds are not issued within 180 days of the date of the allocation letter, the portion of such allocation for which bonds have not been issued will be treated as forfeited and will be available for reallocation.

h. Extensions and new Applications . The IRS does not expect to grant extensions to the expiration date of the volume cap allocation as set forth in section 4.g. of this notice. An Indian tribal government that is unable to issue the proposed bonds within the 180-day period from the date of the allocation letter may reapply for an allocation. The new Application must comply with this notice, including by providing the information described in section 3.k. of this notice, and will be subject to the submission provisions of section 4.b. and the applicable limits set forth in section 4 of this notice.

i. Voluntary forfeiture . If an Applicant determines that it does not intend to use an allocation of volume cap to issue the proposed bonds (including circumstances in which the Applicant determines to finance the project with financing other than the proposed bonds), the Applicant should notify the IRS in writing at the address set forth in section 3.d. of this notice of its intention to forfeit the allocation. The notice will permit the IRS to treat the allocation as forfeited as of the date the IRS receives the notification, and the forfeited amount will be available to reallocate.

1 Federally-chartered corporations organized and controlled by Indian tribal governments under section 17 of the Indian Reorganization Act of 1934 are eligible Indian tribal governmental issuers of tax-exempt bonds under § 7871 and eligible governmental users of proceeds of tax-exempt bonds for purposes of the private business restrictions on governmental bonds under § 141. See Treas. Reg. § 1.301.7701–1(a)(3) (Section 17 Corporations are integral parts of Indian tribal governments and are not recognized as separate entities apart from the Indian tribal governments for Federal tax purposes); Rev. Rul. 94–16, 1994–1 C.B. 19 (Section 17 Corporations are not separate taxable entities apart from the controlling Indian tribes and are not subject to Federal income taxation).

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tion between the information submitted in the Application and the actual information subsequent to the bond issuance, and (3) include a certification that the Applicant has received an opinion from bond counsel to the effect that the change will not cause the bonds to fail to meet all applicable requirements of § 7871(f) and the applicable requirements of §§ 103 and 141 and the regulations under such sections.