TITLE
A JOINT RESOLUTION AND PROCLAMATION ADVOCATING FOR LOCAL INFRASTRUCTURE INVESTMENT AND CALLING ON CONGRESS TO MAINTAIN THE TAX-EXEMPT STATUS OF MUNICIPAL BONDS
BODY
WHEREAS, Municipal bonds serve as the primary financing tool for local governments to fund essential infrastructure projects-including roads, bridges, water systems, and public safety facilities-ensuring long-term economic vitality, public safety, and community stability; and
WHEREAS, The American Society of Civil Engineers (ASCE) has consistently rated the nation's infrastructure in poor condition, most recently assigning it a grade of 'C-' and highlighting the urgent need for sustained investment; and
WHEREAS, Interest on municipal bonds has been exempt from the federal income taxes for over a century, dating back to the Revenue Act of 1913 which re-established the federal income tax; and
WHEREAS, Over $4.3 trillion worth of municipal bonds have been issued over the last decade (2015-2024) to fund vital infrastructure projects that enhance the nation’s economy, including roads, bridges, airports, seaports, and water and sewer systems; and
WHEREAS, There are legislative proposals within the United States Congress that would eliminate or limit the tax-exempt status of municipal bonds; and
WHEREAS, Eliminating the tax exemption is projected to increase borrowing costs for state and local governments by an estimated $823.92 billion over the next decade (2026-2035), potentially leading to higher taxes and utility rates, with an average cost increase of $6,554.67 per American household, according to the Public Finance Network; and
WHEREAS, The City of Gahanna recently benefitted from the municipal interest exemption when the city issued a total of $64 million worth of tax-exempt municipal bonds to finance construction of 825 Tech Center Drive. Had the city issued bonds at then-prevailing taxable interest rates that were 2 percentage points higher, it would have increased the total interest cost over the life of the bonds by $15.5 million.
NOW, THEREFORE, BE IT JOINTLY RESOLVED BY THE COUNCIL AND PROCLAIMED BY THE MAYOR OF THE CITY OF GAHANNA, COUNTY OF FRANKLIN, STATE OF OHIO:
Section 1. That this Council and Mayor do hereby strongly oppose any federal legislative or regulatory efforts that would eliminate or limit the tax-exempt status of municipal bonds, recognizing the significant financial burden such changes would impose on the City’s taxpayers.
Section 2. That this Council and Mayor urge the United States Congress to protect and uphold the federal tax exemption for municipal bonds, ensuring continued access to affordable financing for critical infrastructure projects.
Section 3. That the Clerk of Council be directed to transmit a copy of this joint resolution and proclamation to the Ohio Congressional Delegation, including both United States Senators, and the Representatives serving the City of Gahanna, as well as the President of the United States.
Section 4. That this joint resolution and proclamation be distributed to partners at the National League of Cities, Ohio Municipal League, Mid-Ohio Regional Planning Commission, and Central Ohio Mayors and Managers Association to strengthen collective advocacy efforts.
Section 5. That this City of Gahanna commits to engaging residents and local stakeholders to raise awareness about the impact of federal tax policy changes on local infrastructure investments.
Section 6. That this joint resolution and proclamation shall be in full force and effect immediately upon passage and remain in effect until such time as Congress affirms the continued tax-exempt status of municipal bonds.