Port authorities from Ohio and Oregon and a wholesale electricity provider from Nebraska warn that rules proposed by the Internal Revenue Service and the Treasury Department “could hurt their standing as political subdivisions and their ability to issue bonds as well as complicate their governing structure,” The Bond Buyer reports. The new regulations would require that “political subdivisions serve a governmental purpose ‘with no more than an incidental private benefit’ and be governmentally controlled” to issue tax-exempt bonds, according to the article. Chris Burnham, president of the Development Finance Authority in Summit County, Ohio, said, “[m]any Ohio port authorities provide financing that can be construed as private benefit — we issue tax-exempt revenue bonds for parking garages and other public infrastructure through tax increment financing, which under state law, does benefit a private development project.” Cleveland-Cuyahoga County Port Authority chief financial officer Brent Leslie also said the proposed rules could be “problematic,” saying, “some additional clarity around the definition of control would make sure that ports, airports, and other special units/districts have the ability to continue to issue tax-exempt debt for the benefit of the citizens we represent.” A public hearing will be held June 6.
Port authorities say proposed federal regulations could hurt their operations
