Trump ready to deal on infrastructure, top House tax writer says

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WASHINGTON — The Trump administration is all-in on working toward bipartisan infrastructure legislation in this Congress, House Ways and Means Committee Chairman Richard Neal said Tuesday, citing his private talks with Treasury Secretary Steve Mnuchin.

“The secretary says the president is in,” the Massachusetts Democrat told the National Association of State Treasurers during a breakfast speech here. Asked if advance refundings of municipal bonds might be reinstated after being banned last year to offset tax cuts, Neal predicted "a combination of funding sources" would be tapped in the infrastructure package.

The ways and Means Committee will begin infrastructure hearings in about three weeks.

The state treasurers took Neal’s comments as a positive sign for advance refundings, which help lower their cost of financing.

“Clearly it’s a priority for all of us and it sound like it’s a priority for him too,” said Massachusetts Treasurer Deborah Goldberg, senior vice president of NAST. “He opposed it being taken away in the tax bill.”

Goldberg predicted advance refunding “will be on the table” as the House deliberates on financing.

“Bonds are a top priority to him having been mayor of a city that has an aging infrastructure," she said. "He totally get the necessity of state treasurers and local treasurers having the flexibility they need to get the job done.”

NAST President David Damschen, treasurer of Utah, agreed that the chances of having advance refundings reinstated are “very good” and he’s “pretty optimistic” it will be included in bipartisan infrastructure legislation.

Damschen said that as a conservative elected official who is concerned about the magnitude of the national debt and ongoing federal budget deficits, he likes programs like TIFIA, WIFIA and RAIL that provide strong leverage using federal money as a risk reserve.

“Programs like that are very cost effective,” Damschen said.

Neal didn’t specify what programs he’s considering for an infrastructure package, though he did say he’s consulted with Princeton University Economist Alan Krueger, who helped develop Build America Bonds, and he regularly consults with former Treasury Secretary Robert Rubin.

Neal declined to comment on whether House Democrats are considering raising the corporate tax rate to raise revenue.

“I could create a national story if I volunteered an answer,” he said in response. Neal said when he was named chairman of the tax-writing committee, Janice Mays, panel’s former staff director and chief tax counsel, told him, “Mr. Neal there are a handful of jobs in Washington that move markets. You now have one of them.”

Neal said he has “a pretty good relationship” with Secretary Mnuchin and doesn’t want to make public statements to jeopardize that.

“I really am interested in getting something done and if you are on cable TV shows at night it’s more difficult to find common ground,” Neal said. “My staff know better than to ask.”

Neal said his goal is to work on compromises and stay away from the institutional warfare that people see every day on cable TV.

“That’s very unlike from being in the mayor’s office, where you really have to understand what the municipal bond market is like,” said Neal, a former mayor of Springfield, Massachusetts. “And how do you do anything that is worthwhile in local government today without the municipal bond market?”

Neal also reaffirmed his commitment to hold public hearings on technical corrections to the 2017 Tax Cuts and Jobs Act.

“I hope some of you will consider the idea of testifying at the subcommittee level or the full committee level because now people are knocking down the doors for what was wrong with the bill,” Neal told the state treasurers. “And there are going to have to be some technical corrections.

House Republicans already have proposed 87 technical corrections, he said.

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Tax-exempt bonds Infrastructure Refunding bonds Build America Bonds Washington DC
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