Bonds and Financing

Bipartisan Senate bill would reinstate ability to issue tax-exempt advance refunding bonds

A bipartisan group of senators on July 1 introduced the Lifting Our Communities through Advance Liquidity for Infrastructure (LOCAL Infrastructure) Act, which would reinstate the ability to issue tax-exempt advance refunding bonds.

The lead co-sponsors of the bill are Senators Roger Wicker, R-Miss., and Debbie Stabenow, D-Mich.

Additional original cosponsors include Senators John Barrasso, R-Wyoming, Shelly Moore Capito, R-W.Va., Michael Bennet, D-Colo., Tom Carper, D-Del., Bob Menendez, D-N.J., and Jerry Moran, R-Kans.

The bill is a companion to H.R. 2772, the Investing in Our Communities Act, and is identical in effect, but is drafted quite differently.

The American Public Power Association supports both bills.

The senators’ legislation comes in response to calls from state and local leaders for the federal government to provide additional support to communities as they assess the impact of the coronavirus outbreak on their budgets and begin planning for the future, a news release from the offices of Wicker and Stabenow noted.

Advance refunding has saved state and local governments billions of dollars over decades but has been unavailable to state and local governments since 2017, the news release noted.