New Local Infrastructure Financing Tools: Lower Borrowing Costs for Cities.
This law introduces a new type of bond (American infrastructure bonds) that significantly lowers the cost for local governments to finance essential projects like roads and utilities. The federal government provides a direct credit (up to 42%) to the issuer to cover a large portion of the interest payments. This mechanism aims to accelerate local infrastructure development and improve public services.
Key points
The federal government subsidizes up to 42% of the interest paid on new infrastructure bonds, making local public works projects cheaper and faster to implement.
The borrowing limit for small issuers (like small towns or non-profits) is permanently raised from $10 million to $30 million, improving their access to capital markets.
Infrastructure projects funded by these bonds must adhere to prevailing wage requirements (Davis-Bacon Act), supporting local labor standards.
Status:
Expired
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