PABs Will Grow 0.8% In 2010

WASHINGTON — The amount of private-activity bonds that can be issued by state and local governments nationwide in 2010 will rise to almost $30.857 billion, an increase of 0.8%, according to new population figures released by the Census Bureau and the Internal Revenue Service's formula for state PAB volume caps.

The national and state PAB caps for 2010 are based on the Census Bureau's population figures for states between July 1, 2008, and July 1, 2009, which were issued on Dec. 23, and the IRS formula of $90 per capita or $273.775 million, whichever is greater.

The $90 per capita rate, which the IRS published Nov. 9, is unchanged from the rate for 2009, but the $273.775 million figure is up from $273.27 million.

The bureau found total state population grew to 310.974 million from July 1, 2008, to July 1, 2009, compared to the 308.014 million figure it reported for the previous year that was used to calculate volume caps for 2009. Those figures, when combined with the IRS formula, show the national PAB volume cap increasing to almost $30.857 billion for 2010 from $30.607 billion for 2009.

Michigan, which has been hard hit by the declining auto industry, was the only state to lose PAB volume cap for 2010. Its cap dropped 0.3% to $897.28 million from $900.31 million. It lost 33,695 people, taking its population down to 9.97 million from 10.0 million.

Two other states also lost population — Maine and Rhode Island. But because of their low population figures, their PAB volume caps remained at the minimum level of $273.775 million. Maine's population fell 0.11% to 1.318 million from 1.319 million, according to the Census Bureau, which revised its prior year population estimate for the state to 1.319 million from 1.316 million. Rhode Island's population fell 0.03% to 1.053 million from 1.054, which the IRS previously reported as 1.051 million for last year's PAB volume cap calculations.

Texas gained more people than any other state — 478,000 — and had the highest volume cap increase. It's population grew to 24.78 million from 24.30 million, which it previously reported as 24.33 million. Its cap will rise to more than $2.23 billion in 2010 from $2.19 billion in 2009.

Seventeen other states showed population gains, as well as volume cap increases of 1.0% or more. PAB caps increased 1.8% for Louisiana, South Carolina, and Washington; 1.7% for Colorado and North Carolina; 1.5% for Arizona, Georgia, Massachusetts and Virginia; 1.3% for Missouri, Pennsylvania and Tennessee; 1.2% for Maryland and Oklahoma; 1.1% for Florida and Kentucky; and 1.0% for Alabama.

California was the most populous state from July 1, 2008, to July 1, 2009, with about 37 million, according to the Census Bureau. But it gained only 204,998 more people, according to revised estimates for the previous year. Its volume cap would rise by 0.6% to $3.33 billion from $3.31 billion.

Wyoming showed the largest percentage growth. Its population rose 2.12% to 544,270 from 532,981, which was previously reported as 532,668. But its PAB cap rose only 0.2% to $273.78 million from $273.27 million because of the change in the amount of PABs small states are permitted to issue.

The PAB volume cap figures for 2010 do not include four U.S. possessions — American Samoa, Guam, the Northern Mariana Islands, and the U.S. Virgin Islands. They are treated like states by the IRS, but their populations are so low that the receive the small-state minimum. They are low volume issuers and rarely, if ever, reach their PAB caps, according to market sources.

However, the figures include Puerto Rico, a fifth high-volume possession. The island gained 13,251 more people for a population of 3.97 million. Its PAB cap rose 0.3% to $357.06 million from $355.86 million.

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