Opposition Growing to Proposals to Cap or Eliminate Tax-exempt Status of Municipal Bonds

Apr 09, 2013, 11:00 ET from Municipal Bonds for America

WASHINGTON, April 9, 2013 /PRNewswire/ -- Municipal Bonds for America (MBFA) today unveiled a list of more than thirty influential organizations that have joined MBFA's growing national coalition in opposing efforts to cap or eliminate the tax-exempt status of municipal bonds. 

Opposition to capping or eliminating the tax-exempt status of municipal bonds continues to grow as local leaders review the impact a change in tax-exempt status would have on critical infrastructure such as schools, roads, bridges, water and sewer systems, airports, and affordable housing. 

The new list unveiled today by Municipal Bonds for America includes several leading national organizations, including the Associated General Contractors, Association of Metropolitan Water Agencies, Council of Development Financial Agencies, Education Finance Council, National Association of Local Housing Finance Agencies, National League of Cities, and the National School Boards Association.

Statewide groups joining the effort include Business Oregon, California Special Districts Association, Colorado Municipal League, Florida League of Cities, Kentucky School Boards Association, the League of Minnesota Cities, South Carolina Jobs Economic Development Authority, and Texas Association of Local Housing Finance Agencies.

"Municipal bonds are the primary method used by public entities like the Regional Transportation Authority to finance vital capital improvements," said Joseph G. Costello, Regional Transportation Authority Executive Director.  "Eliminating or capping the deduction would increase the borrowing cost of local infrastructure improvements, which in turn would lead to higher taxes for residents and less funding for much needed infrastructure projects." 

"Curtailing or eliminating the municipal bond tax exemption would raise costs for financially-strapped communities and ultimately local taxpayers," said Russell Truell, CFO at City of Franklin, TN.  "Shifting this burden would result in less investment in infrastructure at a time when jobs continue to be scarce and the state of our public works is deteriorating."

Organizations joining effort to oppose proposals to cap or eliminate elimination of the municipal bond tax exemption:

Airports Council International - North America
American Public Gas Association
The Associated General Contractors
Association of Metropolitan Water Agencies
Bay Area Toll Authority
Business Oregon
California Special Districts Association
Chester County Economic Development Council
Chicago Regional Transportation Authority
Cleveland-Cuyahoga County Port Authority
Colorado Municipal League
Council of Development Financial Agencies
CPS Energy
CSDA Finance Corporation
Education Finance Council
Escambia County Housing Finance Authority
Florida League of Cities
International City/County Management Association (ICMA)
International Economic Development Council
Investment Company Institute
Kentucky School Boards Association
Large Public Power Council
The League of Minnesota Cities
National Association of Local Housing Finance Agencies
National League of Cities
National School Boards Association
South Carolina Jobs Economic Development Authority (SCJEDA)
Texas Assn. of Local Housing Finance Agencies

Below is a list of individuals who helped launch Municipal Bonds for America and currently serve on the coalition's Executive Committee:

Marc Jahr , Chairman, NYC Housing Development Corporation President
Mayor Steve Benjamin, Columbia, SC
Harry Black, Director of Finance, City of Baltimore  
Joseph G. Costello, Executive Director, (Chicago-area) Regional Transportation Authority
Lars Etzkorn, Program Director, National League of Cities
Marc S. Gerken, PE, President & CEO, American Municipal Power
John Murphy, Executive Director, National Association of Local Housing Finance Agencies
Toby Rittner, President & CEO, Council of Development Finance Agencies
Vince Sampson, President, Education Finance Council
Russell Truell, Chief Financial Officer, Franklin, TN

About Municipal Bonds for America

MBFA is a rapidly expanding coalition of organizations and individuals interested in the preservation of tax-exempt bonds.  The coalition is educating the Administration and Congress on the municipal market and advocating for sensible rules for municipal bonds.  To learn more or to become involved in MBFA activities, please visit the coalition's website at www.munibondsforamerica.org.

SOURCE Municipal Bonds for America