WASHINGTON – The Republican co-founder of the House Municipal Finance Caucus is among the muni industry allies who lost their re-election bids Tuesday.
The change in control of the House does end the threat of Republicans terminating the tax-exemption of private activity bonds to help pay for additional tax cuts, but the cost includes the loss of some industry allies such as Rep. Randy Hultgren, R-Ill.
Hultgren has co-chaired the Municipal Finance Caucus since he co-founded it with Rep. Dutch Ruppersberger, D-Md., in March 2016.
Other losers Tuesday included House Ways and Means Committee Republican Reps. Peter Roskam of Illinois and Erik Paulsen of Minnesota.
Among the Democratic allies who lost was Sen. Claire McCaskill, D-Mo., a member of the Senate Finance Committee.
Hultgren has no apparent successor on the Municipal Finance Caucus, but muni lobbyist Chuck Samuels said Wednesday he’s confident one either will step forward or will be encouraged by the muni industry to do so.
“Randy Hultgren was a leader with the guts to step forward for the municipal finance community when that wasn’t really popular for House leadership,” said Samuels, an attorney at Mintz Levin who serves as counsel to the National Association of Health & Educational Facilities Finance Authorities.
Maintaining bipartisan leadership of the caucus is important, said Emily Brock, director of the federal liaison office of the Government Finance Officers Association.
The muni industry will need to develop a strategy “to identify and then make ‘the ask’ of a Republican who could co-chair the caucus,” Brock said. “But at the end of the day it’s the members who own that caucus.”
“The municipal bond itself has had bipartisan opponents and bipartisan champions,” she added. “To ensure that the caucus remains bipartisan is certainly a priority of ours.”
Brock said the large incoming class of new House and Senate lawmakers from both parties presents the Public Finance Network with an opportunity to educate them on muni issues and enlist new allies.
Rep. Richard Neal, D-Mass., who is nearly certain to chair the House Ways and Means Committee next year, is among the more than 20 members of the Municipal Finance Caucus who were re-elected Tuesday.
Samuels said he’s “cautiously optimistic” that one of his organization’s priorities – raising the limit on bank qualified loans – can be enacted into law in the next Congress because Neal has been a supporter of the bill.
Republican Rep. Tom Reed of New York, who was re-elected to a fifth term and serves on Ways and Means, was the lead House sponsor of the bank qualified loan bill in the last Congress.
The proposal would raise the lending limit to $30 million from $10 million and also switch the limit from the issuer to the borrower, allowing state authorities to grow exponentially in their tax-exempt issuance.
“It’s very important because there are YMCAs, small private colleges, medical clinics, myriad small borrowers out there that frankly that would benefit,” Samuels said.
Under the 2009 American Recovery and Reinvestment Act economic stimulus bill, the changes in bank qualified loans were temporarily allowed. “There were hundreds of small nonprofits and thousands of governments that were able to take advantage of it,” Samuels said.
