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2021 Position Statement <br /> <br /> <br />Bonding <br /> <br />BACKGROUND <br />Bonding is the primary way many major infrastructure projects are funded, either through a direct <br />earmark, or indirectly through grant and loan programs financed through state-issued bonds. <br />Municipal utilities, particularly those with water and/or wastewater facilities can benefit from either <br />or both. Bonding can also assist border to border broadband efforts, and may prove useful for <br />some new carbon reduction efforts expected to be introduced during the 2021 session. While a <br />bonding bill was passed during the fifth special session of 2020, that bill barely made a dent in the <br />total amount of needed funds. <br /> <br />CURRENT STATUS <br />Ώ Over $5 billion worth of requests were received during the 2019-2020 legislative <br />biennium and only $1.9 billion worth of new bonding was authorized. <br />Ώ <br />legislative biennium. <br />Ώ Interest rates remain low making it a better time to borrow. <br />Ώ Bonding bills are generally viewed as assisting in the creation of jobs. An advanced <br />job market would generate enhanced tax revenues collected by the state, which in turn <br />would help addresses the forecasted budget deficit <br />Ώ Many municipal water and wastewater utilities will be facing the need to upgrade their <br />wastewater and drinking water facilities to address ever-increasing regulatory <br />requirements as well as to replace aging infrastructure. These projects will not be <br />affordable without state financial assistance from a bonding bill. <br />REQUESTED ACTION <br />MMUA encourages the State Legislature to maximize the investment in infrastructure projects and <br />supports funding to the PFA for grants and loans to municipal utilities. <br />3131 Fernbrook Lane North, Suite 200, Plymouth, MN55447-5337·763.551.1230 ·763.551.0459 Fax ·www.mmua.org <br />379 <br />