State and local governments have issued municipal bonds for centuries to help build our communities and our economy. Over the last decade, the use of tax-exempt financing has provided funding for approximately $1.7 trillion in infrastructure investments nationwide such as bridges, roads, hospitals, and public natural gas systems.
As units of state and local government, public natural gas systems are able to issue tax-exempt bonds for projects that promote the public good. Just as cities and counties issue tax-exempt bonds for projects like schools and hospitals, public natural gas systems use these bonds for investments in infrastructure and long-term energy purchases.
To reduce the federal deficit, Congress and the administration are seeking new sources of federal revenue. Ideas include proposals to limit tax-exempt financing, an essential financing tool used by our members. One proposal the Obama administration has made is a cap on deductions and exemptions limiting the value of the municipal bond exemption to 28 percent for investors.
Learn more about tax-exempt financing by watching this APGA video.