HomeMy WebLinkAboutResolution - 2013-R0191 - Urge Congressman To Oppose Legislation That Elimates/Diminishes Tax Free Bonds - 06/27/2013Resolution No. 2013-RO191
June 27, 2013
Item No. 5.2
RESOLUTION
WHEREAS, in the 200 years since the first recorded municipal bond was issued
by the City of New York to build a canal, municipal bonds have helped build a strong
economy and provide for the health and welfare of our citizenry;
WHEREAS, three-quarters of all infrastructure investments made in the United
States are financed by municipal bonds;
WHEREAS, municipal bonds finance infrastructure projects that touch the daily
lives of every American citizen and business --roads we drive on, schools and education
for our children, affordable family housing, water systems that supply safe drinking water,
courthouses, hospitals and clinics to treat the sick, airports and ports that help move
products domestically and overseas, and utility plants that power our homes, businesses,
and factories;
WHEREAS, interest on municipal bonds is exempt from Federal taxation as part
of the principle of reciprocal immunity under which the Federal Government is exempt
from State and local taxation and State and local governments are exempt from Federal
taxation;
WHEREAS, the Federal Revenue Act of 1913 codified this principle as part of
the Federal income tax by exempting from income tax the interest on municipal bonds;
WHEREAS, exempting municipal bond interest from Federal taxation reduces
the cost of infrastructure financing by State and local governments;
WHEREAS, reduced infrastructure costs for State and local governments allow
for greater infrastructure investments and savings passed directly to taxpayers and
ratepayers in the form of reduced taxes and fees;
WHEREAS, because of critical infrastructure needs, it is estimated that in 2013,
$300 billion of municipal bonds will be issued;
WHEREAS, keeping infrastructure costs low is critical for job creation and
rebuilding infrastructure is crucial to our Nation's State and local economies, including
power generation, distribution, and transmission;
WHEREAS, the ability of municipal bonds and the 100 -year precedent of the
Federal income tax exemption for municipal bonds pro4,ides State and local governments
timely access to cost-effective capital; and
WHEREAS, the Federal tax exemption for municipal bond interest is a cost-
effective financing vehicle available to State and local governments.
NOW, THEREFORE, BE IT RESOLVED, the Mayor and City Council of the
Great City of Lubbock, Texas strongly urges Congressman Randy Neugebauer to
oppose any legislation that caps deductions for, eliminates, or in any way diminishes
tax free municipal bonds.
-4 Z -
GLIN t. ROBERTSON, MAYOR
FAMIMIS
Reb ca Garza, City Secretak
APPROVED AS TO CONTENT:
Pam Moon, Executive Director of Finance
APPROVED AS ORM:
Mitchell atterwhite, Assistant City Attorney
Res.Congressman Randy Neugebauer
6.12.13