42 U.S.C. § 1437i

Obligations of public housing agencies; contestability; full faith and credit of United States pledged as security; tax exemption

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(a) Obligations issued by a public housing agency in connection with low-income housing projects which (1) are secured (A) by a pledge of a loan under any agreement between such public housing agency and the Secretary, or (B) by a pledge of annual contributions under an annual contributions contract between such public housing agency and the Secretary, or (C) by a pledge of both annual contributions under an annual contributions contract and a loan under an agreement between such public housing agency and the Secretary, and (2) bear, or are accompanied by, a certificate of the Secretary that such obligations are so secured, shall be incontestable in the hands of a bearer and the full faith and credit of the United States is pledged to the payment of all amounts agreed to be paid by the Secretary as security for such obligations.(b) Except as provided in section 1437c(g) of this title, obligations, including interest thereon, issued by public housing agencies in connection with low-income housing projects shall be exempt from all taxation now or hereafter imposed by the United States whether paid by such agencies or by the Secretary. The income derived by such agencies from such projects shall be exempt from all taxation now or hereafter imposed by the United States.(Sept. 1, 1937, ch. 896, title I, § 11, as added Pub. L. 93–383, title II, § 201(a), Aug. 22, 1974, 88 Stat. 667; amended Pub. L. 97–35, title III, § 322(c), Aug. 13, 1981, 95 Stat. 402; renumbered title I, Pub. L. 100–358, § 5, June 29, 1988, 102 Stat. 681; Pub. L. 101–625, title V, § 572(2), Nov. 28, 1990, 104 Stat. 4236.)Editorial NotesPrior Provisions

A prior section 11 of act Sept. 1, 1937, ch. 896, 50 Stat. 893, as amended, authorized capital grants to public housing agencies in assistance of low rentals and was classified to section 1411 of this title, prior to the general revision of this chapter by Pub. L. 93–383.

Amendments

1990—Pub. L. 101–625 substituted “low-income housing” for “lower income housing” wherever appearing.

1981—Pub. L. 97–35 substituted reference to lower income for reference to low-income wherever appearing.

Statutory Notes and Related SubsidiariesEffective Date of 1981 Amendment

Amendment by Pub. L. 97–35 effective Oct. 1, 1981, see section 371 of Pub. L. 97–35, set out as an Effective Date note under section 3701 of Title 12, Banks and Banking.

Notes of Decisions
Cited in 11 cases, 1984–2013 · leading case: United States v. Wells Fargo Bank, 485 U.S. 351 (1988).
United States v. Wells Fargo Bank, 485 U.S. 351 (1988). “shall be exempt from all taxation now or hereafter imposed by the United States.”
Linan-Faye Constr. Co., Inc. v. Hous. Auth. of the City of Camden, 49 F.3d 915 (3rd Cir. 1995). “42 U.S.C.S. § 1437i(e)(l)(E), (e)(4)(D) (1994).”
Charles C. Haffner III & the N. Trust Co., as Executors of the Will of Charles C. Haffner, Jr., Deceased v. United States, 757 F.2d 920 (7th Cir. 1985). · cites it 2× “On cross motions for summary judgment the district court, in a detailed and well reasoned opinion, held that the Project Notes were exempt from federal estate taxes under section 11(b) of the Housing Act of 1937, 42 U.S.C. § 1437i(b). Haffner v. United States, 585 F.”
Valentine Props. Assocs., LP v. United States Dep't of Hous. & Urban Dev., 785 F. Supp. 2d 357 (S.D.N.Y. 2011). · cites it 2× “§ 1437i(j)(l) limits the Secretary’s discretion under 42 U.S.C. § 1437i(j)(2) is not supported by the text.”
Athens-Clarke Cnty. Unified Gov't v. Fed. Hous. Fin. Agency, 945 F. Supp. 2d 1401 (M.D. Ga. 2013). · cites it 2× “890 , codified as amended at 42 U.S.C. § 1437i(b). According to that law, “obligations .”
Hertel v. Bank of Am. N.A., 897 F. Supp. 2d 579 (W.D. Mich. 2012). “” 42 U.S.C. § 1437i(b). Despite this exemption, the Court permitted the United States to enforce its estate tax against these notes.”
Hennepin Cnty. v. Fed. Nat'l Mortg. Ass'n, 933 F. Supp. 2d 1173 (D. Minnesota 2013). “In analyzing the statute, the Court explained: Well before the Housing Act was passed, an exemption of property from all taxation had an understood meaning: the property was exempt from direct taxation, but certain privileges of ownership, such as the right to transfer the…”
Haffner v. United States, 585 F. Supp. 354 (N.D. Ill. 1984). “12% project note due 5/11/79 Although listing the Project Notes on Schedule B, the executors stated that they were not taxable, relying on section 11(b) *356 of the Housing Act of 1937, 42 U.S.C. § 1437i(b) (“section 11(b)”), 1 pursuant to which the Project Notes had been issued.”
Nicolai v. Fed. Hous. Fin. Agency, 928 F. Supp. 2d 1331 (M.D. Fla. 2013). “The Supreme Court found that Project Notes indeed were not exempt from federal estate taxation, stating: Well before the Housing Act was passed, an exemption of property from all taxation had an understood meaning: the property was exempt from direct taxation, but certain…”
William F. Netsky, as of the Est. of Frank W. Netsky, Deceased v. United States, 859 F.2d 1 (3rd Cir. 1988). “653, 667 (1974) (codified as amended at 42 U.S.C. § 1437i(b) (1982)) expressed Congress’ “clear and strong intent” to make Project Notes such as those at issue here exempt from estate tax.”
Bd. of Cnty. Commissioners of Kay Cnty., Oklahoma v. Fed. Hous. Fin. Agency, 956 F. Supp. 2d 184 (D.D.C. 2013). · cites it 2× “In Wells Fargo, the Supreme Court interpreted a provision of the Housing Act of 1937, 42 U.S.C. § 1437i(b), which attempted to stimulate housing financing by permitting state and local authorities to issue tax-free obligations called “Project Notes.”
— 42 U.S.C. § 1437i(b) — 9 cases
United States v. Wells Fargo Bank, 485 U.S. 351 (1988). “shall be exempt from all taxation now or hereafter imposed by the United States.”
Charles C. Haffner III & the N. Trust Co., as Executors of the Will of Charles C. Haffner, Jr., Deceased v. United States, 757 F.2d 920 (7th Cir. 1985). “On cross motions for summary judgment the district court, in a detailed and well reasoned opinion, held that the Project Notes were exempt from federal estate taxes under section 11(b) of the Housing Act of 1937, 42 U.S.C. § 1437i(b). Haffner v. United States, 585 F.”
Athens-Clarke Cnty. Unified Gov't v. Fed. Hous. Fin. Agency, 945 F. Supp. 2d 1401 (M.D. Ga. 2013). “890 , codified as amended at 42 U.S.C. § 1437i(b). According to that law, “obligations .”
Hertel v. Bank of Am. N.A., 897 F. Supp. 2d 579 (W.D. Mich. 2012). “” 42 U.S.C. § 1437i(b). Despite this exemption, the Court permitted the United States to enforce its estate tax against these notes.”
Hennepin Cnty. v. Fed. Nat'l Mortg. Ass'n, 933 F. Supp. 2d 1173 (D. Minnesota 2013). “In analyzing the statute, the Court explained: Well before the Housing Act was passed, an exemption of property from all taxation had an understood meaning: the property was exempt from direct taxation, but certain privileges of ownership, such as the right to transfer the…”
— 42 U.S.C. § 1437i(e)(l)(E) — 1 case
Linan-Faye Constr. Co., Inc. v. Hous. Auth. of the City of Camden, 49 F.3d 915 (3rd Cir. 1995). “42 U.S.C.S. § 1437i(e)(l)(E), (e)(4)(D) (1994).”
— 42 U.S.C. § 1437i(j)(2) — 1 case
Valentine Props. Assocs., LP v. United States Dep't of Hous. & Urban Dev., 785 F. Supp. 2d 357 (S.D.N.Y. 2011). “§ 1437i(j)(l) limits the Secretary’s discretion under 42 U.S.C. § 1437i(j)(2) is not supported by the text.”
— 42 U.S.C. § 1437i(j)(l) — 1 case
Valentine Props. Assocs., LP v. United States Dep't of Hous. & Urban Dev., 785 F. Supp. 2d 357 (S.D.N.Y. 2011). “§ 1437i(j)(l) limits the Secretary’s discretion under 42 U.S.C. § 1437i(j)(2) is not supported by the text.”
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