Young, Cortez Masto Introduce Legislation to Support Community Development Projects Nationwide
WASHINGTON – U.S. Senators Todd Young (R-Ind.) and Catherine Cortez Masto (D-Nev.) introduced the Municipal Investment and Neighborhood Transformation (MINT) Act to support community development projects across the country. The legislation would allow Federal Home Loan Bank (FHLBank) member institutions to support local development authorities by credit enhancing tax-exempt bonds for non-housing related community development projects.
“Our bill will restore a proven financing tool to help lower costs for community development projects in towns across America. Bureaucratic red tape should not stand in the way of local communities accessing affordable financing,” said Senator Young.
“For too long, communities across the country have had a hard time raising the funds they need to make improvements to sewer and water systems, hospitals, schools, and more,” said Senator Cortez Masto. “Our legislation unlocks more options for these communities that were previously unavailable to them and empowers the Federal Home Loan Bank system to better fulfill its mission to support community development.”
“Communities shouldn’t have to pay higher borrowing costs simply because they lack access to Wall Street financing. This bill levels the playing field by giving local lenders the tools they need to help their communities invest in infrastructure, health care, and economic development without putting taxpayers on the hook for higher interest rates. It will help unlock investment where it’s needed most,”said Rep. McClain.
“This legislation is another way the Federal Home Loan Banks can work with our member financial institutions to make a meaningful difference in communities around the nation,” said Brendan McGrath, President and CEO, FHLBank Indianapolis.
Currently, FHLBank member institutions are allowed to support municipalities when they’re setting up housing related tax-exempt bonds but are unable to do so for a variety of other community development projects, such as infrastructure improvements, water and sewage treatment facilities, transportation centers, industrial development, health care facilities, or schools. The senators’ legislation would include these non-housing community development projects as eligible for Letters of Credit from FHLBank member institutions, making it easier for municipalities and their development authorities to secure a tax-exempt bond to fund these projects. The FHLBanks previously had this authority from 2008 to 2010.
The legislation was introduced in the House of Representatives by Congressmembers Lisa McClain (R-MI-09) and Sam Liccardo (D-CA-16).
Full legislative text can be found here.