Cities Disappointed and Frustrated By Muni Bond Cap Proposal in Administration Budget
WASHINGTON, April 10, 2013 /PRNewswire-USNewswire/ -- The following statement is from Clarence Anthony, executive director of the National League of Cities in response to President's Obama's 2014 budget proposal:
"The National League of Cities is very disappointed that the White House budget includes a proposal to cap the amount of municipal bond interest that can be deducted from taxes. This proposal undermines the President's laudable goal of expanding investment in our nation's poorly performing infrastructure.
"Municipal bonds are the primary mechanism utilized by cities to fund their infrastructure investments. Capping the deduction amount and thereby limiting the exemption for interest earned on municipal bonds will significantly raise the costs for cities doing these projects. Research indicates that if this cap had been in place for the last decade, it would have cost cities an additional $173 billion more for the same projects. This proposal would force cities - still recovering from the recession - to pull back projects or pass the costs on to their residents in order to go forward with much needed infrastructure projects.
"We remain frustrated the Administration continues to view limiting the exemption as a cost saving measure, rather than seeing it for what it really is - a significant cost increase for local governments and our residents."
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.
SOURCE National League of Cities