Posted by Debby McElroy
On May 3 – 5, ACI-NA held its annual Economics and Finance Conference in Miami. It was a fabulous meeting, with more than 250 airport and associate representatives attending. While all the presentations were really good, I was particularly struck by the bond data presented by Michael Lexton of J.P. Morgan. While ACI-NA has been working with our members to obtain updated information on bond issuances to help educate Congress on the importance of making permanent the AMT holiday for private activity bonds, we did not have access to overall statistics. Michael indicated that as a result of the AMT holiday, AMT debt declined from 68% of debt issued in 2008 to only 8% of debt for 2009 through April 30, 2010. He also noted that airport bond issuances are on pace to reach a record level in 2010. Airport debt issuance for January – April 2010 reached $6.85 billion, compared with $1.39 billion and $5.14 billion respectively in the same period in 2009 and 2008.
These bonds are financing new infrastructure and jobs as well as reducing debt, allowing airports to reduce their costs and preserve air service. The case is clear – we need to make AMT relief for private activity bonds permanent and extend the refunding period. Unfortunately we are running against the clock to ensure the current relief, included in the American Relief and Reinvestment Act, does not expire at the end of 2010. ACI-NA was instrumental in having a one-year extension in one of the House jobs bill, HR 4849. The same legislation is pending before the Senate Finance Committee and we are also lobbying for its passage by the Senate. If you have not done so already, be sure to call your senators and let them know how important this extension is to airports and the companies that support the industry.
We are also encouraging all airports to work with their legislators to cosponsor HR 425 and S 138 to make the AMT relief permanent and expand refunding. When you make that call, also encourage your legislators to cosponsor these bills. Remember it is all about job creation and economic development and airports have a great story to tell!