Washington DC

If Congress passes the pending tax bills, BABs and more than $85B of mandatory federal programs would be jeopardized.

At least 355 potential tax reform amendments were filed with the Senate Finance Committee on Monday.

The SEC's Office of Compliance Inspections and Examinations found municipal advisors had trouble meeting registration, books and records and supervisory requirements.

The 20% corporate tax rate also would have an adverse impact on the muni market.

The muni market would fare better in the Senate Republicans' tax reform proposal, which would preserve private activity bonds and enhance them through the repeal of the alternative minimum tax. However, advance refundings and the SALT deduction would be terminated, a "one-two punch" for state and local governments.

Tax-exempt student loan bonds have saved families $815M over the last 20 years.

Senate Finance Commitee chairman Orrin Hatch's tax proposal will likely be kinder to municipal bonds than the House's bill, but harder on states and localities.

Some House Republicans pledged to work with Democrats to save PABs, advance refundings in tax reform legislation.

House Ways and Means Committee Republicans rejected an effort to keep the full deduction for state and local taxes.

The House GOP bill, if passed, would lower feasibility of P3s, Fitch said.

“We have to get an energy grid up there that will survive the test of time,” Rep. Rob Bishop, R-Utah, said about Puerto Rico.

Advance refundings were 27% of market last year, PABs were 19% and most were 501(c)(3)s.

“This is a work in progress,’’ said Rep. Jackie Walorski, R-Ind.

Already facing the potential loss of several key financing tools and a 20% corporate tax rate that would cheapen the relative value of tax-exempt munis, there could be even more pain in store for the municipal market when the Senate weighs in.

The House Ways and Means Committee begins deliberations on the 429-page tax reform bill noon Monday.

The bill, which calls for the elimination of advance refundings, private activity bonds, tax credit bonds, and tax-exempt stadium bonds, would shrink the municipal market despite preserving the tax-exemption on muni bond interest.

The proposal would provide an array of tax breaks and incentives for disasters dating back to 2012.

Rep. Richard Neal said Democrats will not have had time to review the House GOP tax reform bill.

A SIFMA official testified about muni regulatory concerns of dealers.

Pro Publica found a similar plan for Hawaii publicly posted on the Internet.