WASHINGTON — A bipartisan group of House members will introduce Hurricane Sandy relief legislation early next week that includes three municipal bond-related provisions.
The Hurricane Sandy Tax Relief Act of 2012 is sponsored by Rep. Bill Pascrell, D-N.J., and eight others who hail from the storm-affected regions of New York, New Jersey and Connecticut.
“This bill is a crucial first step in bringing much needed tax relief to help families, communities and businesses in our region get back on track,” the coalition said in a joint statement issued Thursday.
The bill is modeled after a similar measure that was enacted in the wake of Hurricane Katrina in 2005, aimed at providing tax relief for individuals, businesses and municipalities in areas designated a federal disaster by President Obama.
One provision would create Sandy recovery bonds under a new state-by-state private activity bond allocation for Sandy-affected areas, including $9.2 billion for each of New York and New Jersey and $3.2 billion for Connecticut. The bonds would be issued to finance the rebuilding of docks, wharfs, commuting facilities and certain housing, water and solid waste infrastructure, as well as facilities to provide electric energy or gas.
The legislation also would waive the first-time homebuyer rule and purchase and income rules for targeted area residences financed with qualified mortgage revenue bonds. In addition, it would increase the amount of qualified home improvement loans with respect to residences located in the specific disaster areas.
In another bond-related provision, the bill would increase the allocation of low-income housing tax credits for individual states containing counties declared a natural disaster area.
Over the past few weeks, the Council of Development Finance Agencies had been working with leaders of Congress on Sandy legislation and urged them to include municipal bond provisions.
“CDFA would like to thank the NY, NJ and CT House leadership for their inclusion of Sandy Recovery Bonds in their bipartisan relief act,” said Toby Rittner, president and chief executive officer of CDFA. “These bonds will go far in helping the areas affected by Sandy recover from these devastating losses. We strongly encourage the Senate and Obama administration to include these bond provisions, endorsed by CDFA, in the final package to ensure that NY, NJ and CT can recover and rebuild.”
Meanwhile, it appears bond-related provisions are not moving forward in Sandy relief legislation in the Senate.
The White House sent Congress a $60.4 billion Sandy relief request late last week and on Wednesday, the Senate Appropriations Committee released its version of a bill which largely reflects the administration’s request.
However, the appropriations bill does not include any municipal bond provisions proposed by Sens. Chuck Schumer, D-N.Y. and Robert Menendez, D-N.J. In a separate bill released Monday, they had also proposed the creation of Sandy bonds and an easing of mortgage revenue bond restrictions, in addition to relief from restrictions on advance refunding bonds for Sandy-damaged areas and other areas declared disasters in 2012 by the Federal Emergency Management Agency.
Schumer said on Thursday that the Senate will likely start debate on the appropriations bill Monday. Under federal law, all appropriations bills have to originate in the House. It’s likely that if the Senate approves its appropriation bill, it will try to substitute the text of that bill in a House-passed bill.
“I’d like to see that package come over, have an up or down vote and pass the House without incident,” said Rep. Michael Grimm, R-N.Y., at a press conference on Thursday. Grimm was optimistic that a Sandy relief package might pass Congress.