Congressman Mike Thompson (CA-1), a senior member of the House Committee on Ways and Means, today joined other committee Democrats to introduce H.R. 992, the Building American Jobs Act of 2011. The Building American Jobs Act would extend eight bond, tax credit, and loan guarantee programs for states and municipalities, including the extremely successful Build America Bonds program. By giving state and local governments the resources they need to rebuild aging infrastructure, the bill will help our communities compete in a 21st century economy.
"The Building American Jobs Act is an extremely important job creation tool," said Rep. Thompson. "We already know that Build America Bonds spur private-sector investment by helping state and local governments build hospitals, schools, and transportation and water systems. This bill makes the market accessible to those who need it most - a smart strategy that will play a key role in America's long-term economic success."
In Congressman Thompson's district, Build America Bonds have a proven track record of creating jobs and improving local communities. In 2009, the Napa County school system used Build America Bonds to renovate classrooms, expand campuses, and improve the overall learning environment in local schools. The University of California, Davis also benefitted from Build America Bonds, using proceeds from the sale of the bonds to complete deferred maintenance projects and the construction of student housing, classrooms, and research buildings. Finally, Sacramento International Airport - located right outside California's First Congressional District - used bonding authority for new construction and renovation projects, creating over 1,200 jobs in the process. Thanks to the low cost of Build America Bonds, these and other crucial projects were extremely cost-effective for taxpayers.
The programs extended by the Building American Jobs Act were created for state and local governments by the American Recovery and Reinvestment Act, but expired on December 31. The Building American Jobs Act of 2011 includes:
Build America Bonds. The bill would extend the Build America Bonds program through 2012, with a 32 percent subsidy rate in 2011, and 31 percent subsidy rate in 2012. Build America Bonds spur job creation and unleash private-sector investments by helping state and local governments finance infrastructure projects - building schools, hospitals, transit systems, and water systems.
Recovery Zone Bonds. The Building American Jobs Act makes an additional allocation of Recovery Zone bonds to ensure that each local municipality receives a minimum allocation equal to at least its share of national unemployment in December 2009. The bill would also extend the authorization for issuing Recovery Zone bonds through 2011.
Water and Sewer Bonds. The bill would exempt water and sewer projects from private activity bond caps and exclude bonds financing facilities that furnish water and sewage facilities from state volume caps. The bill would also exclude bonds financing facilities that furnish water and sewage facilities from certain limitations on tribal government issuances.
Alternative Minimum Tax/Private Activity Bonds. The Building American Jobs Act would extend both provisions for one year (i.e., exempt from AMT tax-exempt private activity bonds issued in 2011 and current refunding of private activity bonds issued after 2003 and refunded during 2011).
New Markets Tax Credit. The bill would allow the New Market Tax Credit to be claimed against the AMT with respect to qualified investments made between March 15, 2010 and January 1, 2012.
Federal Home Loan Bank Bond Guarantees. The Building American Jobs Act would extend the ability of Federal Home Loan Banks to guarantee tax-exempt bonds through 2011.
Small Issuer Exception for Bank-Qualified Bonds. The bill would extend the ability of financial institutions to purchase tax-exempt bonds of up to $30 million per issuer (from $10 million) through 2011.
Low-Income Housing Tax Credit Exchange Program. The Building American Jobs Act would extend the ability of states to receive a portion of their LIHTC allocation as a direct payment through 2011.