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league of minnesota oities <br /> <br /> Hovember :2, 1983 <br /> ': <br />I ~0: ~yors, ~ana~ers, a~d Clerks ~t, c,., ~/ <br /> <br /> Industrial Development Bond Authority Attacked in Congress <br /> <br />IMMEDIATE ACTION NEEDED <br /> <br />At this hour, the continuing struggle in Congress to restrict and, eventually, to <br />eliminate local authority to issue Industrial Development Bonds hangs precariously <br />in the balance. The situation is complex. Procedural maneuvering and clever <br />efforts to enact these limits without a fair discussion of new restrictions have <br />moved the threat closer than ever before. The bottom line remains the same. <br /> <br />I <br />I <br /> <br />Minnesota city officials must immediately contact their members of the U.S. House of <br />Representatives and both our U.S. Senators urgently requesting that they support the <br />continued authority of cities to issue IDBs without new restrictions, state quotas, <br />or other measures which discriminate against M~nnesota cities, and, potentially, <br />frustrate local economic and redevelopment efforts by city governments. <br /> <br />WHAT HAS ALREADY HAPPENED <br /> <br />I <br />I <br />I <br />I <br /> I <br /> <br />On' October 24, the House Ways and Means Committee reported out a tax bill, H.R. <br />4170, a comprehensive measure dealing with a great ma~y tax policies, but also <br />containing a chapter on IDBs. Final consideration of 'the restrictive IDB provisions <br />was completed in secret. The final bill eventually had 24 sponsors from among <br />committee members (including Congressman Frenzel), including committee chairman, Dan <br />Rostenkowski and senior Republican member, Barber Conable. The anti-IDB provisions <br />include the following new restrictions: <br /> <br />1) <br /> <br />A $150 per capita limit on the amount of IDBs which may be issued <br />annually in each state. The state volume cap would be allocated <br />50~ to the state government and 50~ to local governments on tbs <br />basis of population. The Governor, on an interim basis, and the <br />Legislature would be able to revise the allocation. <br /> <br />2) ~ew, severe,and confusing limits on artitrage. <br /> <br />I <br />I <br /> <br />3) <br /> <br />Limiting the use of small issue IDBs for a principal user not to <br />exceed more than $40 million of IDB debt outstanding after issuance. <br /> <br /> 4) A prohibition on the use of IDBs for the purchase of land or <br /> existipg facilities. <br />I 83 university avenue east, st. paul, minnesota 55101 (61 2] 227-5600 -OYER- <br /> <br /> <br />