WASHINGTON — Municipal market participants yesterday urged lawmakers to expand and extend or make permanent the two-year bond initiatives in the new stimulus law, but said that the tax-credit bond programs are not working and should instead be recast with direct-pay options, like the Built America Bond program.

Alan Krueger, the Treasury Department’s assistant secretary for economic policy and chief economist, who also testified before House Ways and Means select revenue measures subcommittee, was bullish on BABs but unwilling to commit to any expansions or extensions, saying revenue impacts must be considered.

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