Congressman Tom Reed submitted new legislation which will amend the Internal Revenue Code and save taxpayer dollars by expanding the use of local bank-qualified bonds for capital projects. The official announcement of his bill was made Thursday, March 15, 2012 at Salamanca City Central School.
Under the bill, local governments and school districts would see their ability to utilize bank-qualified bonds increase from $10 Million annually to $30 Million annually. As the interest rate on bank-qualified bonds can be as much as a half-percentage point lower than traditional financing, taxpayers can save hundreds of thousands of dollars on a single bond issuance.
“This legislation is good public policy—it provides a means for school districts and local governments to make vital improvements in a more cost effective manner for taxpayers,” Reed said. “Tax dollars will be saved as the local government or school district will pay less in interest and fees. It will provide funding flexibility, which is particularly important to small upstate districts and communities. Most importantly, it keeps the control, financing and benefits right in the local community.”
The bill is co-sponsored by Rep. Richard Neal (D-MA).