WASHINGTON, D.C. – The National Association of State Treasurers (NAST) called on Members of Congress to expand the use of tax-exempt debt to meet future financing thresholds in response to President Donald Trump’s $1.5 trillion infrastructure proposal.
NAST President and Vermont State Treasurer Beth Pearce said, “State and local governments finance more than 75 percent of all U.S. infrastructure projects, and while we are pleased to see that the proposal recognizes the importance of partnering with state and local governments, policymakers must ensure we have access to the funding mechanisms needed to execute this robust plan. As the House and Senate develop legislation, we urge lawmakers to expand the use of tax-exempt debt to ensure state and local governments can maximize their ability to support critically needed infrastructure enhancement.”
Developed during NAST’s 2018 Legislative Conference yesterday in Washington D.C., state treasurers outlined the following three principles to guide federal policymakers as they consider the administration’s infrastructure proposal:
“State treasurers are experts on infrastructure finance, and we must ensure that this plan is implemented using smart strategies that optimize the use of public funds,” said NAST Senior Vice President and Utah State Treasurer David Damschen. “We welcome the expansion of private activity bonds in the President’s infrastructure proposal, and we urge lawmakers to build on this by providing state treasurers with access to the diverse funding mechanisms needed to expedite these important investments. We look forward to working with Congress and the Administration to advance these critical goals.”
Treasurer Damschen explained that tax-exempt advance refunding bonds helped save Utah taxpayers more than $105 million over the past five years alone by allowing the state to refinance bonds at lower interest rates. Last year, states issued more than $100 billion in advance refunding bonds. This refinancing tool was a common practice in states and allowed them to save hundreds of millions of taxpayer dollars per year, which could be reinvested in vital infrastructure projects. Unfortunately, the recent federal tax reform law eliminated the tax-exempt status of advance refunding bonds.
During a panel discussion this morning at NAST’s 2018 Legislative Conference, U.S. Representative Randy Hultgren (R-IL) announced that he and U.S. Representative Dutch Ruppersberger (D-MD), both Co-Chairs of the Municipal Finance Caucus, introduced legislation today to restore the tax exemption for advance refunding bonds that was repealed in the Tax Cuts and Jobs Act.
“States and local governments need flexibility for managing their finances so they can invest in infrastructure like roads, bridges, hospital, libraries and schools to support our communities,” said Rep. Hultgren. “In recent years, tax-exempt advance refunding bonds have saved Illinois taxpayers $80 million per year on average. Given that interest rates are expected to increase, this tool is especially important to states and local governments responsibly planning for the future.”
To learn more about NAST’s federal policies, or about infrastructure spending, click here.
West Virginia State Treasurer John Perdue, with honored guest Governor Jim Justice, announced the launch of a new savings program today at the State Capitol. The West Virginia Achieving a Better Life Experience program, known as WVABLE, will provide people with disabilities an opportunity to save and invest without jeopardizing needs-based public benefits.
“I’m excited this type of savings program is now available to those who need it most here in West Virginia,” said Treasurer Perdue. “This is an important step toward empowering more individuals in our state to plan for their financial future.”
WVABLE helps individuals with disabilities put aside money for qualified expenses, such as rent, transportation, education and training. Individuals may save up to $15,000 per year in a WVABLE account, with earnings accumulating tax-free. Individuals must have developed the disability before the age of 26 to qualify.
“This WVABLE plan will allow me to have more control of my life with the day-to-day freedom to take care of medical emergencies and unexpected home repairs,” said Kevin Smith, one of the first people to sign up for the plan. “The difference between me and others in the community is that they can save for those emergencies, but I have and I have always had to watch the balance of my bank account due to income limits because I receive SSI and Medicaid.”
Prior to passage of the ABLE Act, individuals receiving government benefits were restricted in the amount of money they could save or invest without losing public benefits, such as Supplemental Security Income (SSI) or Medicaid. Before, financial resources in excess of $2,000 in savings could result in the loss of benefits.
“As a parent of a child with a developmental disability, I can tell you that rolling out the WVABLE program has eased my mind,” said Christina Smith, executive director of The Arc of West Virginia.
“We are thrilled that it is finally available in West Virginia, and I am personally excited that my daughter will now have access to a resource that will enable her to achieve more independence, financial security, and an overall better quality of life,” she added.
A WVABLE account will come with a loadable debit card and have features similar to a checking account, but it is also an investment account similar to a 529 college savings account or 401(k) retirement fund.
“The reason it will be good for the younger generation to have access to this plan is because families could put money in their account for their future and when they get older and are facing the same challenges I am, they will already have money put aside to take care of them,” said Kevin Smith. WVABLE is administered by the West Virginia State Treasurer’s Office through a partnership with the Ohio Treasurer’s Office STABLE program.
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The Maryland State Treasurer’s Office, the issuer of this Request for Proposals, is requesting proposals to select a broker to market, manage and service insurance policies and related documents for insurance coverages of (1) aviation exposures and (2) transit exposures for the State of Maryland.
Proposals are due by 2:00 p.m. on March 6 2018.
NAST has signed a letter in response to Moody’s Investor Service, Inc. request for comments on the proposed revisions to their U.S. States Rating Methodology. The letter expresses concerns with the proposed criteria related to the inclusion of U.S. territories in the proposed new criteria and the proposed adjustment of the weights for three of the four factors used in their analysis.
NOW, THEREFORE BE IT RESOLVED, that the National Association of State Treasurers urge the President and the Congress of the United States to pass the ABLE Age Adjustment Act, HR1874/S817, (or substantially similar bills in subsequent Congresses) and the other ABLE plan enhancements described above in a timely manner to enhance and expand opportunities for individuals with disabilities and their families to save for their future needs in ABLE programs.
STATE TREASURERS OUTLINE INFRASTRUCTURE PRINCIPLES IN RESPONSE TO PRESIDENT TRUMP’S $1.5T PROPOSAL https://t.co/0YaZMKUsrG