6.1a ERMUSR 03-13-2017 - Laserfiche WebLink

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DMDMIL( ffiriffirviridr,g p1- . , 10744' -.wry p a } r $n photo courtesy of the Metropolitan Council Environmental Services The St. Croix Valley wastewater treatment plant is one of eight owned by the Metropolitan Council.Total projected capital cost,through 2030,for the Metropolitan system was recently estimated at approximately$3.8 billion. borrowing costs by 32 to 35 percent. Further, some It seems counterintuitive that while Congress and proposals would apply retroactively to $3.7 trillion the White House seem to recognize the urgent need of existing bonds, imposing a significant financial for public infrastructure replacement, some are burden on public power communities. Replacing looking to limit the one tool that local governments the exclusion for municipal bonds with a direct have to control costs as they make the necessary payment bond, as others suggest, would increase investments. borrowing costs by 16 percent (assuming a direct payment percentage of 25 percent of the issuer's MMUA Position interest expenses). We urge Congress to preserve the traditional tax- exempt financing tools used by local governments In short, any proposals to tax municipal bonds since the development of the federal tax code would impose higher borrowing costs on cities and more than a hundred years ago, and to reject all other local governments and discourage investment proposals that would limit or eliminate the tax- in critical infrastructure. Increased borrowing exempt status for municipal bonds, including costs would lead to higher taxes and higher rates replacing muni bonds with tax credits or"direct for municipal electric, water, and wastewater payment bonds." services. 2017 Federal Position Statements/4 173