WASHINGTON – The preservation of tax-exemption has become a key issue for mayors across the country, as they face $1.2 trillion of looming across-the-board sequestration cuts that would drastically reduce federal funding to states and municipalities.

“The preservation of tax-exempt municipal bonds must be upheld,” Columbia, S.C. Mayor Stephen Benjamin said at a U.S. Conference of Mayors’ press conference held Thursday afternoon. “It’s sacrosanct as far as we are concerned. If you mess with tax-exempt muni bonds, you are basically taking away the attractiveness of the capital markets to do anything.”

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