WASHINGTON – Extensions to the Build America Bond program and other expiring bond provisions in last year’s stimulus law took a major step backward Thursday night, after Senate Democrats shelved a tax package following another failed procedural vote.
The American Jobs and Closing Tax Loopholes Act – which includes a two-year extension to BABs, as well as one-year extensions to exemptions from the alternative minimum tax for private-activity bonds and an increased small-issuer limit for bank-qualified debt – again failed to garner enough votes to clear a procedural hurdle.
Senate Democrats have repeatedly scaled back the package in efforts to gain support from moderate members of their own party and Republicans who are concerned about increasing the size of the federal deficit. The vote to limit debate on the package, which required 60 votes, garnered only 57. Following the vote, Senate Majority Leader Harry Reid, D-Nev., tabled the legislation.
“Until Republicans join us in supporting this legislation that will help the middle class and strengthen the economy, we will not be able to move forward,” a spokesperson for Reid said this morning.
Although the bond provisions did not attract much controversy during the legislative process, Democrats were unable to find enough revenue-raising provisions to fully offset the costs of the bill.
Municipal market participants following the legislation said efforts now will turn to finding another legislative vehicle for the bond provisions, hopefully before they expire at the end of the year.
