Nov. 13, 2017 — On Nov. 8, WEF and other water sector organizations sent a letter to House Ways and Means Chair Kevin Brady expressing a strong opposition to a provision in HR 1 that would repeal the ability to advance refund municipal bonds (Section 3602).
Municipal bonds are a fundamental financing tool for water and wastewater – critical public services with significant investment needs that are projected to grow over the coming decade. While WEF and the other organizations are relieved that HR 1 maintains the tax-exempt status for municipal-issued bonds for water and infrastructure projects, Section 3602 - repealing the ability to advance refund municipal bonds - is concerning.
In 2016 alone, nearly $38 billion in tax-exempt municipal bonds were issued for water and wastewater projects, helping local communities meet critical infrastructure needs. Through advance refunding, the municipal water and wastewater sector has a long history of being able to respond to interest rate fluctuation. Advance refunding leads to additional funds being available for utility investment and/or significant savings of water ratepayer and taxpayer dollars.
The House Ways and Means Committee passed (by a party-line vote) their version of the bill out of committee on Thursday, and it is expected to go to the floor next week. Meanwhile, Republicans were briefed on a Senate tax plan Thursday morning.
Click the link to read the letter.
Write your member of Congress to ensure tax-exempt status is maintained for municipal issued bonds.
