Bill Text: TX HCR82 | 2017-2018 | 85th Legislature | Introduced
Bill Title: Urging Congress to retain the tax exemption for municipal bonds.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2017-05-29 - Received from the House [HCR82 Detail]
Download: Texas-2017-HCR82-Introduced.html
85R12726 BPG-D | ||
By: Turner | H.C.R. No. 82 |
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WHEREAS, Interest on municipal bonds has been excluded from | ||
taxation since the enactment of the federal income tax in 1913; and | ||
WHEREAS, Municipal bond tax exemptions provide state and | ||
local governments with a subsidy to finance crucial infrastructure | ||
projects; because municipal bonds are tax-exempt, investors are | ||
willing to accept lower interest payments, thus reducing borrowing | ||
costs for governments; and | ||
WHEREAS, Approximately 6 percent of all bonds issued each | ||
year in the United States are municipal bonds, and in 2016, state | ||
and local governments issued nearly $424 billion in tax-exempt | ||
bonds, representing a six-year high and a 12 percent increase over | ||
2015; governmental bonds typically fund schools, transportation | ||
infrastructure, utilities, and other improvements, creating jobs | ||
while improving the quality of life for area residents; and | ||
WHEREAS, State and local governments make approximately 75 | ||
percent, the overwhelming majority, of our nation's infrastructure | ||
investments, and many of those investments are financed with | ||
municipal bonds; and | ||
WHEREAS, The tax exemption for municipal bonds allows the | ||
federal government to support infrastructure investment in a manner | ||
that minimizes federal bureaucracy and maximizes community | ||
decision making; and | ||
WHEREAS, Over the years, the municipal bond market has | ||
offered greater predictability than most, and it holds tremendous | ||
appeal for individual investors, especially those of retirement | ||
age; municipal bonds are owned disproportionately by households, | ||
rather than by banks and other financial institutions, and a | ||
Brookings Institution study found that the average age of municipal | ||
bondholders was 62; and | ||
WHEREAS, If the tax exemption for municipal bonds were to be | ||
repealed, state and local governments would have to offer higher | ||
returns to continue to attract investors, and taxpayers would pay | ||
more for important infrastructure projects; increased debt service | ||
costs would result in fewer such projects in an era in which the | ||
safety and competitiveness of the nation's infrastructure gives | ||
cause for tremendous concern; and | ||
WHEREAS, For more than a century, the highly efficient | ||
municipal bond market has helped to spur vital infrastructure | ||
investment and associated job creation, and eliminating the federal | ||
tax exemption would jeopardize these low-risk investment | ||
opportunities; now, therefore, be it | ||
RESOLVED, That the 85th Legislature of the State of Texas | ||
hereby respectfully urge the United States Congress to retain the | ||
tax exemption for municipal bonds; and, be it further | ||
RESOLVED, That the Texas secretary of state forward official | ||
copies of this resolution to the president of the United States, to | ||
the president of the Senate and the speaker of the House of | ||
Representatives of the United States Congress, and to all the | ||
members of the Texas delegation to Congress with the request that | ||
this resolution be entered in the Congressional Record as a | ||
memorial to the Congress of the United States of America. |