rp-02-25.pdf

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Part III
Administrative, Procedural, and Miscellaneous

26 CFR 601.601: Rules and regulations.
(Also Part I, § 1397E)

Rev. Proc. 2002-25

SECTION 1. PURPOSE

Pursuant to § 1397E(e)(2) of the Internal Revenue Code,
this revenue procedure allocates among the States the 2002
national limitation amount of Qualified Zone Academy Bonds
(“Bond” or “Bonds”) that may be issued for the calendar year
2002. For this purpose “State” includes the District of
Columbia and the possessions of the United States.
SECTION 2. BACKGROUND
.01 Section 226 of the Taxpayer Relief Act of 1997, Pub.
L. 105-34, 111 Stat. 821 (1997), added § 1397E to the Internal
Revenue Code to provide a credit to holders of Bonds under
certain circumstances so that the Bonds generally can be issued
without discount or interest. Ninety-five percent of Bond
proceeds are to be used for qualified purposes, as defined by

2
§ 1397E(d)(5), with respect to a qualified zone academy, as
defined by § 1397E(d)(4).
.02 Section 1397E(e)(1), as amended by § 608 of the Job
Creation and Worker Assistance Act of 2002, Pub. L. 107-147, 116
Stat. 21 (2002), provides that the national limitation amount of
Bonds that may be issued is $400 million for each of the years
1998, 1999, 2000, 2001, 2002, and 2003. This amount is to be
allocated among the States by the Secretary on the basis of
their respective populations below the poverty level (as defined
by the Office of Management and Budget) and is to be further
allocated by each State to qualified zone academies within the
State.
.03 Section 1397E(e)(4), as amended, by § 509 of the Tax
Relief Extension Act of 1999, Pub. L. 106-170, 113 Stat. 1860
(1999) provides that any carryforward of a limitation amount may
be carried only to the first 2 years (3 years for carryforwards
from 1998 or 1999) following the unused limitation year. For
this purpose a limitation amount shall be treated as used on a
first-in first-out basis.
.04 Rev. Proc. 98-9, 1998-1 C.B. 341, Rev. Proc. 98-57,
1998-2 C.B. 682, Rev. Proc. 2000-10, 2000-2 I.R.B. 287, and Rev.
Proc. 2001-14, 2001-3 I.R.B. 343, respectively, allocated the
national limitation for 1998, 1999, 2000, and 2001 among the
States.
SECTION 3. NATIONAL QUALIFIED ZONE ACADEMY BOND LIMITATION FOR

3
2002
The 2002 national limitation amount for Bonds is $400
million. This amount is allocated among the States as follows:

STATE
MAXIMUM FACE AMOUNT OF
BONDS THAT MAY BE
ISSUED DURING 2002
(thousands of dollars)

ALABAMA $ 7,683

ALASKA 634

ARIZONA 7,061

ARKANSAS 5,589

CALIFORNIA 53,149

COLORADO 4,105

CONNECTICUT 2,621

DELAWARE 862

DISTRICT OF COLUMBIA 898

FLORIDA 19,196

GEORGIA 10,400

HAWAII 1,376

IDAHO 1,927

ILLINOIS 16,827

INDIANA 6,032

IOWA 2,465

KANSAS 3,004

KENTUCKY 5,637

LOUISIANA 8,736

4

STATE
MAXIMUM FACE AMOUNT OF
BONDS THAT MAY BE
ISSUED DURING 2001
(thousands of dollars)

MAINE $ 1,269

MARYLAND 4,632

MASSACHUSETTS 7,528

MICHIGAN 11,884

MINNESOTA 3,411

MISSISSIPPI 4,284

MISSOURI 5,266

MONTANA 1,628

NEBRASKA 1,771

NEVADA 2,035

NEW HAMPSHIRE 766

NEW JERSEY 7,970

NEW MEXICO 3,578

NEW YORK 29,441

NORTH CAROLINA 10,903

NORTH DAKOTA 730

OHIO 13,847

OKLAHOMA 6,032

OREGON 4,572

PENNSYLVANIA 12,710

RHODE ISLAND 1,017

SOUTH CAROLINA 4,787

SOUTH DAKOTA 802

5

STATE
MAXIMUM FACE AMOUNT OF
BONDS THAT MAY BE
ISSUED DURING 2001
(thousands of dollars)

TENNESSEE $ 9,814

TEXAS 36,059

UTAH 2,537

VERMONT 850

VIRGINIA 6,391

WASHINGTON 7,097

WEST VIRGINIA 2,968

WISCONSIN 6,199

WYOMING 646

AMERICAN SAMOA 418

GUAM 426

NORTHERN MARIANAS 381

PUERTO RICO 26,727

VIRGIN ISLANDS 422

SECTION 4. EFFECTIVE DATE
This revenue procedure is effective April 29, 2002, and
applies to Bonds issued after March 9, 2002.
DRAFTING INFORMATION
The principal author of this revenue procedure is Zoran
Stojanovic of the Office of Assistant Chief Counsel (Tax
Exempt/Employment Tax/Government Entities). For further
information regarding this revenue procedure contact
Mr. Stojanovic on (202) 622-3980 (not a toll-free call).