By Annie Russo
Thanks to a provision included by Congressman Richard Neal (D-MA) in H.R. 4849, the Small Business and Infrastructure Jobs Tax Act of 2010, the Alternative Minimum Tax (AMT) exemption on private activity bonds (PABs) has gained traction on the Hill. H.R. 4849 includes an extension of the provision in the American Recovery and Reinvestment Act (ARRA) that exempts PABs from the AMT through 2011. The provision also extends the refinancing provision found in ARRA for PABs issued between 2004 and 2008 to be refinanced through 2011.
During the markup of H.R. 4849 by the House Ways and Means Committee on Wednesday, several Members spoke about the positive impact the provision has had on their local airports as it is helping stimulate economic growth and creating jobs in their communities. Airports have been a shining example of how this provision has made a significant difference in the bond market with airports selling almost $10 billion in bonds since the passage of ARRA. What a contrast to the second half of 2008 when the market was virtually frozen, and many ongoing airport infrastructure projects were in danger of stopping while others were delayed.
While the Ways and Means Members were talking about the provision’s successes, Los Angeles World Airports Executive Director Gina Marie Lindsey was making the case for extending the provision before the House Appropriations Subcommittee on Transportation. LAX plans to go to the market next week to sell $898 million in bonds for the rehabilitation of the Tom Bradley International Terminal. Lindsey told the Subcommittee that LAX will save $100 million because of the exemption while creating thousands of new, good-paying construction jobs.
Although the proof that the exemption has helped open the markets for the sale of airport PABs is overwhelming, as an industry we need to continue to make the case on the Hill about how this provision helps our local communities through economic impact and jobs creation. Talking about the sales of bonds is simply not enough. As the Ways and Means Committee moves H.R. 4849 to the House floor, please contact your Congressman in support of the bill, and let him or her know how your airport has benefited from the provision and the impact your bond sale has had on your community.