February 23, 2017
Every day, hundreds of millions of Americans wake up, hop in the shower, brush their teeth, and head to school or work. They may walk or bike on sidewalks, drive on roads or highways then park on the street or in a public garage. Maybe they ride a subway, bus or regional train. Neighborhood police and fire stations protect their homes and businesses; hospitals and clinics stand ready to treat the injured or ill; and trash is hauled to dumps or incinerators. At the end of the day, we can relax in neighborhood parks, study at the local library, or attend a council meeting in the town hall.
These are the things that we take for granted, but which are absolutely essential to our lives and wellbeing, our businesses and our commerce. They can be built privately and often are built with some amount of direct federal aid. In reality, though, roughly two-thirds of all core infrastructure built in the U.S. is built by state and local governments and financed with tax-exempt municipal bonds.
For example, Washington D.C., may be considered a federal city, but much of its infrastructure – its bread and butter – is being financed with municipal bonds. More than 200 public elementary and secondary schools serving nearly 50,000 students are maintained and modernized by the issuance of tax-exempt municipal bonds.
The Children’s National Medical Center, Columbia Hospital for Women Foundation, and the Greater Southeast Healthcare System all fund capital projects by issuing tax-exempt municipal bonds. The District of Columbia Water & Sewer Authority uses tax-exempt municipal bonds to keep water flowing to taps and to collect and treat the wastewater that results. And all across America, in small towns and big cities, municipal bonds play the same vital economic role.