rp-20-49.pdf

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Administrative, Procedural, and Miscellaneous

26 CFR 601.601: Rules and Regulations.
(Also: §§ 147, 1.147(f)-1)

Rev. Proc. 2020-49

SECTION 1. PURPOSE
This revenue procedure provides temporary guidance regarding the public approval
requirement under § 147(f) of the Internal Revenue Code for tax-exempt qualified
private activity bonds. Specifically, in light of the continuing Coronavirus Disease 2019
(COVID-19) pandemic, this revenue procedure extends until September 30, 2021, the
time period described in section 4.02 of Rev. Proc. 2020-21, 2020-22 I.R.B. 872, during
which certain telephonic hearings are permitted.
SECTION 2. BACKGROUND
.01 Pursuant to § 147(f), tax-exempt qualified private activity bonds are subject to a
public approval requirement. Except for refunding bonds described in § 147(f)(2)(D), a

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bond issue must be approved by the governmental unit issuing the bonds (or on behalf
of which such bonds are issued) and by the governmental unit having jurisdiction over
the area in which any facility to be financed by the issue is located. Under
§ 147(f)(2)(B), an issue will be treated as having been approved by any governmental
unit if the issue is approved by the applicable elective representative of the
governmental unit after a public hearing following reasonable public notice, or by voter
referendum of the governmental unit.
.02 Section 1.147(f)-1(d)(1) of the Income Tax Regulations provides that public
hearing means a forum providing a reasonable opportunity for interested individuals to
express their views, orally or in writing, on the proposed issue of bonds and the location
and nature of the proposed project to be financed. Section 1.147(f)-1(d)(2) provides
that the public hearing must be held in a location that, based on the facts and
circumstances, is convenient for residents of the approving governmental unit. The
location is presumed convenient for residents of the governmental unit if it is located in
the approving governmental unit’s capital or seat of government. Further, if more than
one governmental unit is required to hold a public hearing, the hearings may be
combined as long as the combined hearing affords the residents of all of the
participating governmental units a reasonable opportunity to be heard. The location of
any combined hearing is presumed convenient for residents of each participating
governmental unit if it is no farther than 100 miles from the seat of government of each
participating governmental unit beyond whose geographic jurisdiction the hearing is
conducted.

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.03 In light of the COVID-19 pandemic, state and local governmental units sought
alternatives to in-person hearings held to meet the public approval requirement. In
response to these concerns, Rev. Proc. 2020-21, effective May 4, 2020, provides
temporary guidance regarding the public approval requirement under § 147(f).
Rev. Proc. 2020-21 provides that for the period ending on December 31, 2020, hearings
held by teleconference that are accessible to the residents of the approving
governmental unit by calling a toll-free telephone number will be treated as held in a
location that, based on the facts and circumstances, is convenient for residents of the
approving governmental unit for purposes of § 1.147(f)-1(d)(2). The Department of the
Treasury and the Internal Revenue Service have received several requests for
extension of the time period set forth in section 4.02 of Rev. Proc. 2020-21. This
revenue procedure extends that time period until September 30, 2021.
SECTION 3. EXTENSION OF TIME PERIOD
The period described in section 4.02 of Rev. Proc. 2020-21 is extended.
Accordingly, section 4.02 of Rev. Proc. 2020-21 is modified as follows:
.02 Time period. The period described in thi s section 4.02 is the period beginning on
May 4, 2020, and ending on September 30, 2021.
SECTION 4. EFFECT ON OTHER DOCUMENTS
This revenue procedure modifie s section 4.02 of Rev. Proc. 2020-21.
SECTION 5. DRAFTING INFORMATION
The principal authors of thi s revenue procedure are Johanna Som de Cerff and
David White of the Office of Associate Chief Counsel (Financial Institutions & Products).

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For further information regarding this revenue procedure, contact Ms. Som de Cerff or
Mr. White on (202) 317-6980 (not a toll-free number).