cumulative cash flow deficit

(II)For purposes of subclause (I), the term “cumulative cash flow deficit” means, as of the date of computation, the excess of the expenses paid during the period described in subclause (III) which would ordinarily be paid out of or financed by anticipated tax or other revenues over the aggregate amount available (other than from the proceeds of the issue) during such period for the payment of such expenses. (III)For purposes of subclause (II), the period described in this subclause is the period beginning on the date of issuance of the issue and ending on the earlier of the date 6 months after such date of issuance or the date of the computation of cumulative cash flow deficit. (iv)For purposes of this subparagraph, payments of principal on the bonds which are part of an issue shall not be treated as expended for the governmental purposes of the issue. (C) (i)In the case of a construction issue, paragraph (2) shall not apply to the available construction proceeds of such issue if the spending requirements of clause (ii) are met. (ii)The spending requirements of this clause are met if at least— (I)10 percent of the available construction proceeds of the construction issue are spent for the governmental purposes of the issue within the 6-month period beginning on the date the bonds are issued, (II)45 percent of such proceeds are spent for such purposes within the 1-year period beginning on such date, (III)75 percent of such proceeds are spent for such purposes within the 18-month period beginning on such date, and (IV)100 percent of such proceeds are spent for such purposes within the 2-year period beginning on such date. (iii)The spending requirement of clause (ii)(IV) shall be treated as met if— (I)such requirement would be met at the close of such 2-year period but for a reasonable retainage (not exceeding 5 percent of the available construction proceeds of the construction issue), and (II)100 percent of the available construction proceeds of the construction issue are spent for the governmental purposes of the issue within the 3-year period beginning on the date the bonds are issued.

Source

26 USC § 148(f)(4)(B)(iii)(II)


Scoping language

None: Default is title Scope
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