WASHINGTON - The massive housing reform and aid bill passed by the House Wednesday raises every state's private-activity bond cap by 38.6% through the end of the calendar year, giving states additional incentives to offer affordable housing financed by tax-exempt bonds.

The housing legislation, which could clear the Senate and be signed into law this weekend, grants an $11 billion increase to the $28.477 billion of volume cap for private activity bonds in 2008. Though states issue private-activity bonds for a variety of purposes, the legislation mandates that they use the additional cap only for single- and multi-family housing projects.

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