Preservation of Muni Bond Tax Exemption Critical to Infrastructure Expansion
Washington, DC - The following statement is from Clarence Anthony, executive director of the National League of Cities (NLC) in response to today's White House announcement on infrastructure investment:
"NLC supports the President's efforts to put people to work while repairing and expanding our national infrastructure. Numerous studies have shown that our nation's infrastructure is badly in need of repair and costs the nation billions of dollars in productivity per year.
"Infrastructure repair would also create good jobs that would support thousands of families while laying the foundation for years of future economic growth. But infrastructure investments cannot be made without a consideration for financing. Currently, municipal bonds are the primary mechanism that local governments utilize when funding infrastructure.
"Recently, there have been calls to eliminate municipal bonds or to cap the amount of municipal bond interest that can be deducted from taxes. These proposals would increase the costs of borrowing for local governments and prevent certain infrastructure projects from going forward.
"NLC remains very concerned about the White House-proposed national infrastructure bank. A poorly funded bank would be no substitute for municipal bonds. If infrastructure investments are to encourage job creation, there must be a robust municipal bond market.
"The White House announcement says The America Fast Forward bonds are modeled after the Build America Bonds program. This program, while successful, made up only a small portion of the total number of municipal bonds that were issued to support infrastructure development and repair. Build America Bonds were, and remain, no substitute for municipal bonds."
The National League of Cities is dedicated to helping city leaders build better communities. NLC is a resource and advocate for 19,000 cities, towns and villages, representing more than 218 million Americans.