PHILADELPHIA — With tax reform efforts hitting a full court press this fall, many are uncertain over whether any changes will have a lasting impact if legislation is not bipartisan, according to Jessica Giroux, deputy director of Governmental Affairs for the National Association of Bond Lawyers.

Giroux said at The Bond Buyer's Mid-Atlantic Municipal Market Conference Tuesday morning that while Republicans are in strong position to pass tax cuts that would get signed by President Trump, slim majorities cast doubts about how permanent the changes might be.

Jessica Giroux will replace Bill Daly as NABL's director of government affairs starting next year.
Jessica Giroux

NABL has advocated for maintaining the tax exempt status for municipal bonds in overall tax reform discussions, but Giroux mentioned concerns are being articulated that any legislation passed without Democratic support could result in only a short-term policy.

"If it is a partisan one-sided bill, who knows how long it is going to last, if Democrats take back control of Congress and the Administration," said Giroux during a question and answer session about the prospects for long-term tax reform.

Jennifer Bloun, professor of accounting at the University of Pennsylvania's Wharton School, said the biggest impact to public finance under a tax reform measure would be if private activity bonds are no longer subject to the alternative minimum tax. She said certain tax cuts are especially needed such as bringing down the top statutory corporate tax rate from its current 35% compared to 17% in the United Kingdom.

"If we want to maintain our multi-national headquarters and what goes with it we have to something about that," said Bloun of the high corporate tax rate. "Right now our system incentives foreign capital to buy U.S. assets and that is not a good way to be playing this
game."

Giroux said lobbying efforts on Capitol Hill have centered mainly on preserving the municipal bond tax exemption, but have also expanded to highlight other interests. She said the Government Finance Officers Association is fighting hard to preserve the federal deduction for state and local taxes.

Additionally, members of the Public Finance Network have been “going to the hill to meet with members of congress and the Administration," said Giroux, who joined NABL in August after working as general counsel and managing director for Bond Dealers of America. "They are targeting certain members."

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Corrected October 25, 2017 at 10:48AM: An earlier version contained a quote that should have been conditional.