As previously reported on Conduit Street, MACo’s President, Wicomico County Executive Rick Pollitt, wrote a letter to Maryland’s Congressional Delegation asking for their support to keep municipal bonds tax exempt throughout Congress’s upcoming budget negotiations.
Since MACo sent its letter, we have received positive feedback from several congressional offices, including the offices of Senator Cardin, Representative Delaney of Maryland’s 6th district, and Representative Ruppersberger of Maryland’s 2nd district. MACo recently received a letter from Representative Ruppersberger, sharing his concern regarding eliminating or capping the tax exemption on municipal bonds and pledging to move quickly and aggressively on this matter.
Representative Ruppersberger, who served as MACo President in 1996 while in office as Baltimore County Executive, described how in recent discussions of the matter in the House Ways and Means Committee, several committee members who previously served in local government underscored the importance of municipal bonds as a financing tool — and how the proposals on the table would unfairly shift costs to local residents through tax or rate increases. However, the Congressman noted that he though the effort to secure the tax exemption would be an uphill battle requiring bipartisan support. The Congressman writes,
. . . in order to address your concerns, I have directed my staff to begin evaluating options on legislation that I may introduce to protect the current tax-exempt status of these bonds. It is my intention to move quickly and aggressively on this matter and I will make sure to involve you and other MACo members in this process. The initial research performed by my staff indicates that this may be an uphill battle. In order to be successful and benefit our communities, it is important to build bipartisan support. Therefore, I will be reaching out to my Republican colleagues in the coming days on this issue.
In yesterday’s Baltimore Sun, Congressman Ruppersberger wrote an op-ed piece on the issue. The Congressman wrote,
Nationally, studies suggest that three-fourths of infrastructure projects are financed by these [municipal] bonds, supporting hundreds of thousands of good-paying jobs. As a former county councilman, county executive and president of the Maryland Association of Counties, I understand that tax-exempt bonds are the most efficient way to fund such infrastructure projects. Unfortunately, not enough members of Congress have local government experience.
For more information, see the Congressman’s letter to MACo, or full op-ed in the Baltimore Sun and our recent coverage:
President’s Budget Proposal Caps Municipal Bond Tax Exemption