The elimination of the alternative-minimum tax for housing bonds is expected to attract corporate investors to the municipal housing bond market for the first time and lower borrowing costs for issuers, market participants said yesterday.

President Bush is expected today to sign the housing legislation containing the AMT provision, as well as a provision providing an extra $11 billion of capacity for housing bonds under the private-activity bond volume cap. State and local housing agencies will be able to begin issuing housing debt that is not subject to the AMT as soon the bill is enacted.

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