credit shall be distributed to such beneficiaries) under procedures prescribed by the Secretary. (j) Credits May be Stripped Under regulations prescribed by the Secretary— (1) In general There may be a separation (including at issuance) of the ownership of a qualified renewable energy bond and the entitlement to the credit under this section with respect to such bond. In case of any such separation, the credit under this section shall be allowed to the person who on the credit allowance date holds the instrument evidencing the entitlement to the credit and not to the holder of the bond. (2) Certain rules to apply In the case of a separation described in paragraph (1), the rules of section 1286 shall apply to the qualified renewable energy bond as if it were a stripped bond and to the credit under this section as if it were a stripped coupon. . (b) Payments to issuers Subchapter B of chapter 65 of such Code is amended by adding at the end the following: 6431. Credit for qualified renewable energy bonds allowed to issuer (a) In general The issuer of a qualified renewable energy bond (as defined in section 54(d)) shall be allowed a credit with respect to each interest payment under such bond which shall be payable by the Secretary as provided in subsection (b). (b) Payment of credit The Secretary shall pay (contemporaneously with each interest payment date under such bond) to the issuer of such bond (or to any person who makes such interest payments on behalf of the issuer) 35 percent of the interest payable under such bond on such date. (c) Application of arbitrage rules For purposes of section 148, the yield on such bonds shall be reduced by the credit allowed under this section. (d) Interest payment date For purposes of this subsection, the term interest payment date means each date on which interest is payable by the issuer under the terms of the bond. . (c) Conforming amendments (1) The table of subparts for part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new