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• • • <br />~ d'~ ~/~, <br />RESOLUTION IN OPPOSITION TO <br />THE PRESIDENT'S TAX PROPOSALS <br />FOR MUNICIPAL BONDS <br />WHEREAS, on May 29, 19$5, President Reagan submitted his <br />tax proposal for "fairness, growth and simplicity" to <br />Congress; and <br />WHEREAS, included in the President's tax proposals are <br />provisions which would eliminate or limit the tax-exemption of <br />state and local government bonds including bonds issued by the <br />City of La Porte; and <br />WHEREAS, the President's proposals would deny tax-exempt <br />status to bonds where the private sector benefits directly or <br />indirectly from the use of more than one percent of the <br />proceeds of the bond issue; would eliminate all advance <br />refundings of tax-exempt bonds; would restrict the investment <br />of bond proceeds; would require that certain earnings from the <br />investment of bond proceeds be paid to the U. S. Treasury <br />Department; would require that an Internal Revenue Service <br />information report be filed for every bond issue; and would <br />impose additional taxes on banks that purchase tax-exempt <br />bonds; and <br />WHEREAS, eachiof the President's proposed limitations on <br />tax-exempt municipal bonds would adversely affect the City of <br />La Porte by increasing borrowing costs, requiring continuous <br />administrative review of bond issues and the use made of <br />facilities financed with such issues, requiring filings with <br />the Internal Revenue Service and review by the Internal <br />Revenue Service of each bond issue, and jeopardizing the <br />tax-exemption on bonds where the private sector benefits <br />directly or indirectly from the use of more than one percent <br />of a project financed by such bonds; and <br />