Municipal Bonds, 2009

Municipal Bonds, 2009

by Aaron Barnes

T

he municipal bond market experienced significant changes in 2009, when Congress expanded

bond finance options to include: tax-exempt

bonds, tax credit bonds, and direct payment bonds.

Traditionally, State and local governments across

the United States and its territories have been able to

issue tax-exempt bonds to finance essential operations, facilities, infrastructure, and services for their

constituents.1 Tax credit bonds are a finance option

that allows municipalities to borrow funds under

certain qualifying bond programs. Direct payment

bonds were created by the American Recovery and

Reinvestment Act of 2009 (ARRA), in response to

the financial crisis.

ARRA expanded financing options for projects

by allowing State and local governments to issue

direct payment bonds through the Build America

Bonds (BABs) and the Recovery Zone Economic

Development Bond (RZEDs) Programs.2 Direct payment bonds are taxable bonds for which the issuer

receives a direct subsidy at either 35 percent or 45

percent of borrowing costs, depending on the type of

bond. These direct payments are generally deeper

subsidies than the implicit subsidy in traditional taxexempt bonds. Unlike tax credit bonds, the market,

and not the Treasury, sets the interest rate paid on the

bonds. Additionally, ARRA authorized new types of

tax-exempt bonds, tax credit bonds, and an increased

volume cap, or total allowable issuance amounts, for

existing tax credit bonds.

The data presented in this article are based on the

populations of Forms 8038, Information Return for

Tax-Exempt Private Activity Bond Issues, and Forms

8038-G, Information Return for Tax-Exempt Governmental Obligations, filed with the Internal Revenue

Service (IRS) for bonds issued during Calendar Year

2009. The vast majority of these returns were filed

in 2009 and 2010 for tax-exempt bonds.3 However,

for 2009, the issuers of direct payment bonds and tax

credit bonds were also required to use these returns

Aaron Barnes is an economist with the Special Studies

Special Projects Section. This data release was prepared

under the direction of Melissa Ludlum, Chief.

1

Total Tax-Exempt Bonds, Direct Payment

Bonds Allowed Under the American Recovery

and Reinvestment Act and Tax Credit

Bonds, 2009

[Money amounts are in millions of dollars]

Type of bond

Total [1]

Tax-exempt bonds

Direct payment bonds [2]

Tax credit bonds [3]

Number

Amount

Percentage

of total

amount

(1)

(2)

(3)

26,384

515,283

100.0

25,095

446,233

86.6

911

65,326

12.7

378

3,724

0.7

[1] Includes combined data from all governmental and private activity bond returns

(Forms 8038-G and 8038).

[2] Bonds reported on the Form 8038-G, Information Return for Tax-Exempt

Governmental Obligations, with a specific reference to "Build America Bond" or

"Recovery Zone Economic Development Bond" in either their issue name or other

description.

[3] Includes data from governmental and private activity bond returns (Forms 8038G and 8038) that specifically reference "qualified school construction," "clean

renewable energy," "qualified zone academy," or "Midwestern tax credit" bonds.

NOTE: Detail may not add to totals because of rounding.

to report certain information to the IRS. For this reason, the article also includes separate discussions of

direct payment bonds and tax credit bonds.

Figure A provides an overview of the municipal

bond market in 2009. State and local governments

raised $515.3 billion in proceeds from tax-exempt,

direct payment, and tax credit bonds. Tax-exempt

bond proceeds totaled $446.2 billion, or 86.6 percent,

of all municipal bonds proceeds in 2009. Proceeds

from newly introduced direct payment bonds totaled

$65.3 billion and made up 12.7 percent of all municipal bond proceeds in 2009. Tax credit bond proceeds

were a little more than $3.7 billion and accounted for

0.7 percent of all municipal bond proceeds in 2009.

Tax-Exempt Bonds

Tax-exempt bonds issued by State and local governments are classified as either “governmental” or “private activity,” depending on whether the proceeds

are used and secured by public or private entities and

resources. The total amount of tax-exempt bonds

issued by State and local governments decreased

by 4.9 percent between Calendar Years 2008 and

The term “State” includes the District of Columbia and any possessions of the United States.

Issuers had the option of either receiving a direct payment or issuing a tax credit version, such that the bondholder receives a 35-percent credit. BABs were not issued

using the tax credit option.

3 Bond issuers were required to fi le these tax-exempt bond information returns by the 15th day of the second calendar month after the close of the calendar quarter in which

the bond was issued. The study includes returns processed from January 1, 2009, to April 30, 2011, for bonds issued in 2009.

2

158

Figure A

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

2009, from $469.4 billion in 2008 to $446.2 billion

in 2009.4 For 2009, governmental bonds accounted

for $340.7 billion (76.3 percent) of total tax-exempt

bond proceeds. Private activity bonds accounted for

the remaining $105.6 billion (23.7 percent).

When a bond is issued, the issuer is obligated

to repay the borrowed bond proceeds, at a specified

rate of interest, by some future date. For Federal

income tax purposes, investors who purchase governmental bonds and certain types of private activity bonds are able to exclude the bond interest from

their gross incomes.5, 6 This tax exemption lowers

the borrowing cost incurred by tax-exempt bond issuers, since holders of tax-exempt bonds are generally willing to accept an interest rate lower than that

earned on comparable taxable bonds. The interest

exclusion for tax-exempt bonds is not allowed for

arbitrage bonds and bonds not in registered form.7, 8

Both governmental and private activity bonds

are obligations issued by, or on behalf of, State and

local governmental units; use of the proceeds differentiates the two. Governmental bond proceeds

finance essential government operations, facilities,

and services that are for general public use, and the

debt service on these bonds is paid from general

governmental sources. Private activity bonds are issued by, or on behalf of, State or local governments

for the purpose of financing the project of a private

user. Since private activity bond proceeds are used

by one or more private entities, the debt service is

paid or secured by one or more private entities.9 Interest income earned on most private activity bonds

is taxable. However, over the years, Congress has

deemed certain types of private activities necessary for the public good, and, therefore, interest

income earned on “qualified private activity bonds,”

as defined in Internal Revenue Code (IRC) section

141(e), is generally tax exempt.10, 11

Tax-Exempt Bond Volume, by Term of Issue

Bonds are classified as either short-term or longterm, depending on the length of time from issuance

to maturity. Bonds having maturities of less than 13

months are typically classified as short-term, while

those having maturities of 13 months or more are

classified as long-term. Tax-exempt governmental

bond issues totaled $340.7 billion in 2009, a 1.9-percent increase over the $334.4 billion issued in 2008.

Long-term bonds accounted for $262.4 billion, more

than 77 percent of all governmental bond proceeds.

Long-term bonds are generally used to finance construction or other capital improvement projects.

The remaining $78.2 billion of governmental

bonds were issued for short-term projects. Most

short-term governmental bonds are issued in the

form of tax anticipation notes (TANs), revenue anticipation notes (RANs), or bond anticipation notes

(BANs). TANs and RANs generally mature within 1

4

Data that reference Calendar Year 2008 are available in the Statistics of Income Bulletin, Winter 2011, Volume 30, Number 3, “Tax-Exempt Bonds, 2008,” and do not

appear in any of the tables computed for Calendar Year 2009.

5 In addition, for State income tax purposes, most States allow for the exclusion of interest on bonds issued by government agencies within their own States, thus increasing

the benefit to the bondholder.

6 The extent of exclusion of interest income can vary with taxpayer characteristics. For example, banks and insurance companies may be limited as to how much taxexempt interest they can exclude.

7 An arbitrage bond is one in which any portion of the proceeds is used to purchase higher-yielding investments or is used to replace proceeds that have been used to

purchase higher-yielding investments. Certain rules allow for arbitrage earnings with respect to tax-exempt bonds within a specified time period, as long as these earnings

are rebated to the Department of the Treasury.

8 A registered bond is defi ned as “a bond whose owner is designated on records maintained by a registrar, the ownership of which cannot be transferred without the registrar

recording the transfer on its records,” according to the Municipal Securities Rulemaking Board’s Glossary of Municipal Securities Terms, http://www.msrb.org/msrbl/

glossary/. See also Internal Revenue Code (IRC) section 149(a) for additional information.

9 Section 141(a) of IRC provides that the term private activity bond means any bond issued as part of an issue that meets: 1) the private business tests set forth in the IRC

section 141(b); or 2) the private loan fi nancing test set forth in IRC section 141(c). The private business tests of IRC section 141(b) defi ne a bond as a private activity bond

if both of the following criteria are met: 1) more than 10 percent of the bond proceeds are used for a private business purpose; and 2) more than 10 percent of the bond debt

service is derived from private business use and is secured by privately used property. The private loan fi nancing test of IRC section 141(c) defi nes a bond as a private activity bond if the amount of proceeds used to (directly or indirectly) fi nance loans to nongovernmental persons exceeds the lesser of $5 million or 5 percent of the proceeds.

10 Tax-exempt private activity bonds include exempt facility bonds, qualified mortgage bonds, qualified veterans’ mortgage bonds, qualified small issue bonds, qualified

student loan bonds, qualified redevelopment bonds, and qualified section 501(c)(3) bonds, all of which are defi ned in the “Explanation of Terms” section of this article.

Examples of exempt facilities include airports; docks and wharves; sewage facilities; solid waste disposal facilities; qualified residential rental projects; and facilities for the

local furnishing of electricity or gas. Qualified section 501(c)(3) bonds are issued by State and local governments to fi nance the activities of charitable and similar organizations that are tax exempt under IRC section 501(c)(3). The primary beneficiaries of these bonds are hospitals, universities, and organizations that provide low-income

housing or assisted living facilities.

11 The interest income from qualified private activity bonds (other than qualified section 501(c)(3) bonds) is considered a tax preference for the alternative minimum tax

calculations.

159

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

year of issuance, at which time the proceeds are paid

from specific tax receipts or other revenue sources.

The proceeds of a BAN are typically used to pay

for startup costs associated with a future long-term,

bond-financed project. A renewal BAN can be issued

on maturity of an outstanding BAN, until, eventually, the proceeds of the future bond issue are used to

pay off, or retire, the outstanding BAN. Short-term

bonds accounted for almost $2.8 billion, only 2.6

percent, of the total private activity bond proceeds

for 2009.

Long-Term, Tax-Exempt Bond Volume,

by Type of Issue

Total bond issuance is composed of both nonrefunding (“new money”) issues and refunding issues. The

proceeds of new money issues finance new capital

projects, while proceeds of refunding issues retire

outstanding debt of prior bond issues. A bond issue

can include both new and refunding proceeds.

Figures B and C show total long-term issuance,

as well as its distribution between new money and

refunding proceeds, for both governmental and taxexempt private activity bonds issued between 2005

and 2009. In 2009, 57.5 percent of all long-term

governmental bond proceeds were new money issues (Figure B). New money governmental bond

proceeds fell 11.9 percent from its preceding 4-year

average of $171.4 billion to $151.1 billion in 2009,

while refunding proceeds fell approximately 8.3 percent from its preceding 4-year average of $121.5 billion to $111.4 billion in 2009.12

In 2009, 50.8 percent of all long-term private activity bond proceeds were new money issues (Figure

C). New money private activity bond proceeds fell

18.8 percent from its preceding 4-year average of

$64.3 billion to $52.2 billion in 2009, while refunding proceeds fell by 12.2 percent from its preceding 4-year average of $57.6 billion to $50.6 billion

in 2009.

Figure B

Volume of Long-Term, Tax-Exempt Governmental Bonds Issued, by Type and Issue Year,

2005–2009

Billions of dollars

350

$316.3

$311.3

250

200

$271.7

$272.2

300

$262.4

$200.1

$180.2

$159.8

$153.8

$151.1

150

$151.6

100

50

0

2005

$116.1

$117.9

2007

2008

$92.1

$

2006

$111.4

2009

Issue year

All issues

160

12

New money proceeds

Refunding proceeds

Additional tax-exempt bond data, including data for prior years, can be found on SOI’s Tax Stats web site: http://www.irs.gov/taxstats. Click on “Tax-Exempt Bonds.”

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure C

Volume of Long-Term, Tax-Exempt Private Activity Bonds Issued, by Type and Issue Year,

2005–2009

Billions of dollars

160

$136.6

140

120

$109.5

$102.8

$108.6

$86.6

100

$80.3

80

60

40

$132.8

$63.3

$52.2

$54.8

$54.7

$45.3

$50.0

$52.5

2007

2008

$50.6

20

0

2005

2006

2009

Issue year

All issues

New money proceeds

Long-Term Bond, Tax-Exempt Volume, by

Selected Purpose

Figures D and E present the composition of longterm tax-exempt bond proceeds, by selected purpose

as well as type of issue, for both governmental and

private activity bond issues. Figures D shows that

during 2009, $142.0 billion of long-term governmental bond proceeds financed education, utilities, and

transportation projects. “Other bond purposes” had

the largest long-term governmental bond proceeds

by purpose totaling $90.3 billion.13 For almost all of

the governmental bond purposes shown in Figure D,

more proceeds were spent financing new capital projects than were used to refund prior bond issues with

the exception of utilities.

Qualified section 501(c)(3) bonds, which include

total qualified hospital bonds and qualified nonhospital bonds issued to benefit entities exempt from

income tax under IRC section 501(c)(3), combined,

Refunding proceeds

accounted for $65.7 billion in long-term private activity bond proceeds for 2009 (see Figure E). Private

activity bonds issued to provide housing assistance

were expended upon in 2009 with the creation of the

Housing Assistance Tax Act of 2008 (the 2008 Housing Act) which provided a temporary increase in the

annual volume cap for qualified housing issues and

allowed certain issuers of qualified mortgage bonds

to refinance subprime mortgage loans under IRC sections 142 and 143.14 Private activity bonds issued to

provide housing assistance in the form of qualified

residential rental projects, qualified mortgages, and

other qualified purposes under the 2008 Housing Act

accounted for another 10 percent of total proceeds. 15

Of the total private activity bond proceeds allocated

towards housing assistance, $1.5 billion were the result of the 2008 Housing Act.

The ARRA added IRC section 1400U-3, which

authorized tax-exempt recovery zone exempt facility

bonds. Recovery zone exempt facilities bonds are

13

Instructions for Form 8038, Information Return for Tax-Exempt Private Activity Bond Issues, requires a filer to enter the issue price of the bond on Line 20c and provide

a description of the bond only if the bond does not apply to any other type of issue. “Other bond purposes” may also contain issues that were not separately allocated by the

issuer.

14 See Internal Revenue Notice 2008-79 for additional information.

15 This figure does not include the relatively small amount of proceeds issued for qualified veterans’ mortgage bonds and Gulf Opportunity Zone mortgage bonds, which are

excluded to avoid disclosure of information about specific bonds.

161

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure D

Long-Term, Tax-Exempt Governmental Bonds, by Selected Bond Purpose and Type of Issue, 2009

Billions of dollars

100

90

80

70

$43.2

60

$26.4

50

40

30

$19.7

$47.1

20

$11.7

$45.9

10

$5.7

$20.1

$18.2

$4.3

0

Other purposes [1]

Education

Utilities

Transportation

$2.6

$1.2

$10.9

Environment

$2.6

Public safety

Health and hospital

Bond purpose

New money proceeds

Refunding proceeds

[1] "Other purposes" refer to obligations for which a specific purpose either did not apply or was not clearly indicated on the Form 8038-G, Information Return for Tax-Exempt

Government Obligations.

Figure E

Long-Term, Tax-Exempt Private Activity Bonds, by Selected Bond Purpose and Type of Issue, 2009

Billions of dollars

35

30

25

$14.6

$19.2

20

15

10

$17.8

$14.1

5

$3.4

$3.1

$3.6

$3.3

$2.4

$2.4

Water, sewage, and solid

waste disposal

Airport

Qualified mortgage

Qualified residential rental

$2.6

0

Qualified hospital

Qualified section

501(c)(3) nonhospital

Bond purpose

New money proceeds

162

Refunding proceeds

$1.4

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure F

States with Largest Decreases and Increases in

Amount of New Money Long-Term, Tax-Exempt

Governmental Bonds from 2008 to 2009

[Money amounts are in millions of dollars]

2008

amount

2009

amount

Annual net

change

in amount

(1)

(2)

(3)

153,771

151,050

Texas

21,593

14,512

-7,081

Florida

10,594

7,224

-3,370

Illinois

5,770

3,521

-2,249

Ohio

3,597

1,826

-1,771

Nevada

2,465

997

-1,468

California

15,918

27,872

11,954

Oregon

1,356

3,019

1,663

Connecticut

2,354

3,453

1,099

New York

15,310

16,364

1,054

New Mexico

1,486

2,354

868

State

All States

-2,721

States with decreases

States with increases

NOTE: Detail may not add to totals because of rounding.

private activity bonds that may be issued by State

and local governments to finance qualified projects

located in certain areas having significant poverty,

unemployment, home foreclosure rates, general distress, or distress from the closure of a military installation, or those areas designated as an empowerment

zone or renewal community.16 For 2009, there were

17 recovery zone exempt facility bonds issued for a

total of $95 million in proceeds.

Overview of Tax-Exempt Bond Issues, by State

Figure F presents States with the largest absolute decreases and increases in amount of new money longterm, tax-exempt governmental bonds from 2008

to 2009. Total new money long-term governmental

bond proceeds decreased $2.7 billion (1.8 percent)

from 2008 to 2009 (Figure F). Texas and Florida,

whose issuance fell 32.8 percent and 31.8 percent, respectively, experienced the largest absolute decreases

in new money long-term governmental bond proceeds in 2009. Illinois also experienced a decrease

(39 percent) in new money long-term governmental

bond proceeds in 2009. In all, 26 States decreased the

amount of new money long-term governmental bond

proceeds from 2008 to 2009, by nearly $25.9 billion.

California experienced the largest absolute increase (75.1 percent) in new money long-term governmental bond proceeds in 2009. States with significant

increases in new money long-term governmental

bond proceeds from 2008 to 2009 included Oregon,

whose proceeds increased 122.6 percent; Connecticut,

whose proceeds increased by 46.7 percent; and New

York, whose proceeds grew by 6.9 percent. In all, 26

States increased the amount of new money long-term

governmental bond proceeds from 2008 to 2009, by

slightly less than $23.2 billion.17

Figure G presents the amount of bonds proceeds for the top 15 States, in terms of total dollar

volume of new money long-term, tax-exempt bonds

issued for 2009, for governmental bonds. Combined, the top 15 States accounted for 71.8 percent

of the total $151.1 billion of new money long-term

governmental bond proceeds for the year (see Figure G). About $71.6 billion (47.4 percent) of the

total proceeds were issued by authorities in the following five States: California (18.5 percent), New

York (10.8 percent), Texas (9.6 percent), Florida

(4.8 percent), and Pennsylvania (3.8 percent). According to 2009 Census estimates, together, these

five States accounted for almost 30.6 percent of the

total U.S. population.18

An examination of issuance by State reveals

some differences in the allocation of proceeds by

bond purpose. Overall, for 2009, 30.4 percent of the

$151.1 billion of new money long-term governmental bonds was issued for educational purposes. However, of the total amount of new money long-term

bonds issued in Texas, 43.1 percent was issued for

education. In contrast, 14 percent of long-term governmental bonds issued in Connecticut and 9 percent

in Georgia were for this purpose.

Transportation projects accounted for 13.3 percent of States’ total new money long-term proceeds.

In New Jersey, however, 38.1 percent of the total

amount of new money long-term governmental

16

See Internal Revenue Notice 2009-50 for additional information.

The term “State” includes the District of Columbia and any possessions of the United States.

18 The resident population estimates for July 1, 2009, were produced by the U.S. Bureau of the Census and are available at http://www.census.gov/popest/states/

NST-ann-est.html.

17

163

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure G

New Money Long-Term, Tax-Exempt Governmental Bonds, by Selected Bond Purpose, for Top 15

States, Ranked by Total Tax-Exempt Governmental Bond Issuance, 2009

[Money amounts are in millions of dollars]

Selected bond purpose

Total

Other purposes [1]

State of issue

Education

Amount

Amount

Percent

of State total

(1)

(2)

(3)

Amount

Percent

of State total

(4)

(5)

Total, All States

151,050

47,072

31.2

45,935

30.4

California

27,872

5,109

18.3

10,357

37.2

New York

16,364

7,826

47.8

2,984

18.2

Texas

14,512

2,955

20.4

6,256

43.1

Florida

7,224

2,850

39.5

1,847

25.6

Pennsylvania

5,674

1,215

21.4

2,158

38.0

Washington

4,582

1,896

41.4

700

15.3

Arizona

4,221

653

15.5

1,054

25.0

Georgia

4,167

1,725

41.4

377

9.0

North Carolina

4,011

952

23.7

1,277

31.8

Virginia

3,740

1,182

31.6

1,608

43.0

Illinois

3,521

1,546

43.9

1,393

39.6

Connecticut

3,453

2,361

68.4

484

14.0

New Jersey

3,274

902

27.6

885

27.0

Oregon

Minnesota

3,019

2,810

951

1,738

31.5

61.9

1,160

406

38.4

14.4

Selected bond purpose—continued

Transportation

State of issue

Utilities

Environment

Amount

Percent

of State total

Amount

Percent

of State total

Amount

Percent

of State total

(6)

(7)

(8)

(9)

(10)

(11)

Total, All States

20,089

13.3

18,169

12.0

10,921

7.2

California

3,435

12.3

3,242

11.6

3,720

13.3

New York

2,861

17.5

878

5.4

619

3.8

Texas

1,520

10.5

3,241

22.3

196

1.4

Florida

531

7.4

1,146

15.9

313

4.3

Pennsylvania

1,421

25.0

220

3.9

426

7.5

Washington

793

17.3

621

13.6

315

6.9

Arizona

911

21.6

1,209

28.6

265

6.3

Georgia

924

22.2

122

2.9

912

21.9

North Carolina

584

14.6

648

16.2

124

3.1

Virginia

68

1.8

225

6.0

502

13.4

Illinois

388

11.0

113

3.2

28

0.8

Connecticut

247

7.2

286

8.3

21

0.6

New Jersey

1,247

38.1

28

0.9

102

3.1

Oregon

428

14.2

143

4.7

205

6.8

Minnesota

170

6.0

170

6.0

117

4.2

[1] For purposes of this figure, "other purposes" refers to obligations for which a specific purpose either did not apply or was not clearly indicated on the Form 8038-G. It does not

include specific purposes identified on the tax return, such as public safety and housing, that are not shown separately in the figure. See Table 5.

NOTE: Detail may not add to totals because of rounding.

164

bonds was for transportation, while in Minnesota,

only 6 percent was allocated for the same purpose.

Transportation bonds accounted for only 1.8 percent

of Virginia’s total amount of new money long-term

bond issues.

Utility bond proceeds accounted for 12 percent

of all new money long-term governmental bonds in

2009. Arizona and Texas each spent a large portion

of their total allocation on utility projects, 28.6 percent and 22.3 percent, respectively. In contrast, New

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure H

States with Largest Decreases and Increases in

Amount of New Money Long-Term, Tax-Exempt

Private Activity Bonds from 2008 to 2009

[Money amounts are in millions of dollars]

2008

amount

2009

amount

Annual net

change

in amount

(1)

(2)

(3)

52,488

52,216

-272

Louisiana

2,453

941

-1,512

Missouri

1,638

871

-767

Maryland

1,269

542

-727

Arizona

1,045

364

-681

New Jersey

2,089

1,523

-566

State

All States

States with decreases [d]

States with increases

New York

5,398

7,582

2,184

California

5,488

7,389

1,901

Illinois

1,902

3,007

1,105

Texas

2,212

2,620

408

875

1,273

398

Wisconsin

[d] Data on U.S. possessions are deleted to avoid disclosure of individual issuer

information. However, the data are included in the appropriate totals.

NOTE: Detail may not add to totals because of rounding.

Jersey allocated 0.9 percent of its total amount of

new money long-term bonds to utility projects.

Figure H presents States with the largest absolute

decreases and increases in amount of new money

long-term, tax-exempt private activity bonds from

2008 to 2009. Total new money long-term, taxexempt private activity bond proceeds decreased by

roughly $0.3 billion (0.5 percent) of $1.5 billion from

2008 to 2009 (Figure H). Louisiana experienced the

largest absolute decrease (61.6 percent) in new money

long-term, tax-exempt private activity bond proceeds

in 2009. States with significant relative decreases in

new money long-term, tax-exempt private activity

bonds from 2008 to 2009 included Missouri, whose

proceeds fell 46.8 percent; Maryland, whose proceeds

fell 57.3 percent; and Arizona, whose proceeds fell

65.2 percent. For the 30 States that reduced their issuance of new money long-term, tax-exempt private activity bonds in 2009, the overall reduction in proceeds

totaled $1.1 billion.

New York experienced the largest relative increase (40.5 percent) in new money long-term, taxexempt private activity bond proceeds. Other States

with significant increases in new money long-term,

tax-exempt private activity bond issues from 2008

to 2009 included California, whose proceeds increased 34.6 percent; and Illinois, whose proceeds

increased 58.1 percent. In all, 22 States increased

their new money long-term, tax-exempt private activity bond proceeds from 2008 to 2009, by just less

than $0.9 billion.

Figure I shows the amount of bond proceeds

for the top 15 States, in terms of total dollar volume

of new money long-term, tax-exempt bonds issued

for 2009, for private activity bonds. Combined, the

top 15 States accounted for 73.3 percent of the total

$52.2 billion of new money long-term, tax-exempt

private activity bond proceeds for the year. Almost

$23.6 billion (45.1 percent) of the total proceeds

was issued by authorities in the following five

States: New York (14.5 percent), California (14.2

percent), Illinois (5.8 percent), Pennsylvania (5.7

percent), and Texas (5.0 percent). According to

2009 Census estimates, together, these five States

accounted for almost 34.8 percent of the total U.S.

population. Interestingly, with the exception of Illinois and Florida, the same States have the highest

amount of proceeds of both governmental bonds

and private activity bonds.

Similar to governmental bond issuance, there

were differences in the composition of total new

money long-term, tax-exempt private activity bond

issuance, by purpose, among the States. Examining

the bond allocations by purpose for 2009, overall,

34.1 percent of the amount of new money long-term

private activity bond proceeds was for qualified IRC

section 501(c)(3) nonhospital organizations. Another

26.9 percent was issued for qualified hospital bonds.

Of the total amount of new money long-term,

tax-exempt private activity bond proceeds raised

in Georgia, 67.8 percent was issued for IRC section

501(c)(3) nonhospital organizations, compared to

11.8 percent in Ohio and 10.5 percent in New Jersey for the same purpose. Qualified hospital bonds

accounted for 57.3 percent of Ohio’s new money

long-term, tax-exempt private activity bond proceeds, compared to 10.6 percent and 6 percent Texas

and Georgia, respectively. Of the top 15 States,

New York had the lowest total issuance for qualified

hospitals, with only 3.7 percent of its State total proceeds allocated for this purpose.

Bonds issued for airports, docks, and wharves

accounted for 7.1 percent of all new money longterm, tax-exempt private activity bond proceeds in

2009, totaling $3.7 billion. California committed

165

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure I

New Money Long-Term, Tax-Exempt Private Activity Bonds, by Selected Bond Purpose, for Top 15

States, Ranked by Total Tax-Exempt Private Activity Bond Issuance, 2009

[Money amounts are in millions of dollars]

Selected bond purpose

Total

Qualified section 501(c)(3)

nonhospital

State of issue

Qualified hospital

Amount

Amount

Percent

of State total

Amount

Percent

of State total

(1)

(2)

(3)

(4)

(5)

Total, All States

52,216

17,830

34.1

14,070

New York

7,582

2,557

33.7

282

3.7

California

7,389

3,626

49.1

1,793

24.3

Illinois

3,007

1,674

55.7

1,112

37.0

Pennsylvania

2,967

795

26.8

1,146

38.6

Texas

2,620

887

33.9

278

10.6

Massachusetts

2,389

1,369

57.3

491

20.6

Florida

2,102

307

14.6

528

25.1

Ohio

1,759

208

11.8

1,008

57.3

New Jersey

1,523

160

10.5

625

41.0

Virginia

1,440

399

27.7

484

33.6

Wisconsin

1,273

421

33.1

510

40.1

Indiana

1,162

253

21.8

662

57.0

Colorado

1,099

277

25.2

d

d

Georgia

Louisiana

1,014

941

687

181

67.8

19.2

61

d

6.0

d

26.9

Selected bond purpose—continued

State of issue

Total, All States

All other bonds,

combined [1]

Airports, docks,

and wharves [1]

Water, sewage, and solid

waste disposal facilities

Amount

Percent

of State total

Amount

Percent

of State total

Amount

Percent

of State total

(6)

(7)

(8)

(9)

(10)

(11)

3,910

7.5

3,727

7.1

3,616

New York

d

d

442

5.8

d

d

California

0

0

1,342

18.2

163

2.2

Illinois

d

d

0

0

d

d

Pennsylvania

0

0

0

0

614

20.7

13.7

Texas

505

19.3

374

14.3

359

Massachusetts

0

0

0

0

0

0

Florida

d

d

544

25.9

490

23.3

Ohio

0

0

0

0

377

21.4

New Jersey

d

d

d

d

d

d

Virginia

d

d

0

0

d

d

Wisconsin

0

0

d

d

0

0

Indiana

0

0

d

d

d

d

Colorado

0

0

d

d

0

0

Georgia

0

0

0

0

197

19.4

Louisiana

d

d

d

d

0

0

d—Data deleted to avoid disclosure of individual issuer information. However, the data are included in the appropriate totals.

[1] For purposes of this figure, certain bond purposes were combined. For this reason, data in this figure will differ slightly from the data in Tables 7 and 9.

NOTE: Detail may not add to totals because of rounding.

166

6.9

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

18.2 percent of its total new money long-term private

activity bond proceeds toward airports, docks, and

wharves. Florida allocated 25.9 percent of its total

new money long-term private activity bond proceeds

toward airports, docks, and wharves.

Together, States allocated only 6.9 percent of the

$52.2 billion of new money long-term tax-exempt

private activity bonds in 2009 for water, sewage, and

solid waste disposal facilities. However, both Florida

and Ohio directed a much larger share of their total

new money long-term proceeds to this purpose, 23.3

percent and 21.4 percent, respectively. In contrast,

California directed only 2.2 percent of its new money

long-term bond proceeds to water, sewage, and solid

waste disposal facilities.

Tax Credit Bonds

Tax credit bonds differ from tax-exempt bonds in that

they are not explicitly interest-bearing obligations.

In lieu of receiving periodic interest payments from

the issuer, a bondholder is generally allowed an annual income tax credit while the bond is outstanding.

The amount of the credit is determined by multiplying the bond’s credit rate by the face amount on the

holder’s bond. The credit rate on the bonds is determined by the Secretary of the Treasury and is an estimate of the rate that permits issuance of such bonds

without discount and interest cost to the qualified

issuer. The credit is includable in the bondholder’s

gross income (as if it were an interest payment on the

bond), and it can be claimed against regular income

tax liability and alternative minimum tax liability.

The Taxpayer Relief Act of 1997 created the first

type of tax credit bond—the qualified zone academy

bond. In 2005, two additional types—clean renewable energy bonds and Gulf tax credit bonds—were

created. Since then, various legislation has authorized

additional types of tax credit bonds, such as qualified

forestry conservation bonds, new clean renewable

energy bonds, qualified energy conservation bonds,

Midwestern tax credit bonds, and qualified school

construction bonds.19, 20 Issuers of tax credit bonds are

required to submit to the IRS information filings similar to those required of tax-exempt bond issuers.21

ARRA included several provisions that affected

tax credit bonds. Most notably, the Act created

qualified school construction bonds. Qualified

school construction bonds (QSCBs) allow schools

to borrow at lower interest rates. Issuers of QSCBs

must use 100 percent of available project proceeds

to construct, rehabilitate, or repair a public school

facility or to purchase land where a public school

facility will be constructed. A State or local government must issue QSCBs within the schools jurisdiction, and the issuer of the bond must designate the

bond as a QSCB. QSCBs were subject to a national

volume cap of $11 billion for 2009, and an issuer

could not exceed its volume cap allocation.22

ARRA also amended various IRC sections to increase the allowable volume cap for several types of

existing tax credit bonds. Specifically, IRC section

54E(c)(1) increased the national volume cap for qualified zone academy bonds from $400 million to $1.4

billion. ARRA legislation also increased the national

volume cap for new clean renewable energy bonds,

from $800 million to $2.4 billion, and amended IRC

section 54D(d) to increase the national volume cap

for qualified energy conservation bonds from $800

million to $3.2 billion.

ARRA created “Build America Bonds (tax

credit),” which provided a subsidy through Federal

tax credits to bondholders (investors).23 This tax

credit equaled 35 percent of the total coupon interest

payable by the issuer. The bondholder was required

to report the interest income associated with the

Build America Bond (tax credit) as part of their

19 The Food, Conservation, and Energy Act of 2008 created qualified forestry conservation bonds. The Energy Improvement and Extension Act of 2008 produced new

clean renewable energy bonds and qualified energy conservation bonds. The Tax Extenders and Alternative Minimum Tax Relief Act of 2008 created Midwestern tax credit

bonds.

20 Different categories of tax credit bonds vary in terms of the allowable tax credit rate, maturity, and other features. For example, clean renewable energy bonds and qualified zone academy bonds have a 100-percent tax credit subsidy; however, new clean renewable energy bonds and qualified energy conservation bonds have a 70-percent

subsidy. Borrowers are likely to issue at a discount or pay taxable interest in addition to the lender receiving a tax credit.

21 In 2009, issuers of tax credit bonds were instructed to fi le Form 8038, Information Return for Tax-Exempt Private Activity Bond Issues. The 2009 data also include a

small number of tax credit bonds that were reported on Form 8038-G, Information Returns for Tax-Exempt Governmental Obligations, that specifically reference “qualified

school construction” bonds, “clean renewable energy” bonds, “Midwestern tax credit” bonds, or “qualified zone academy” bonds. For tax credit bonds issued after March

2010, issuers were required to file the new Form 8038-TC, Information Return for Tax Credit Bonds and Specified Tax Credit Bonds.

22 Section 54F(d) provides details about a national volume cap for QSCBs. See Internal Revenue Notice 2009-35 for further information on QSCB volume cap allocations.

23 ARRA created two varieties of BABs, which differed based on the federal subsidy and use of proceeds. The one variety of BAB was structured as a tax credit bond and

the other was a direct payment bond.

167

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

gross income, causing a net tax subsidy of less than

35 percent. Build America Bonds (tax credit) could

be issued for any purpose for which traditional taxexempt governmental bonds were issued and were

subject to the same restrictions that apply to taxexempt governmental bonds under IRC section 103.

Build America Bonds (tax credit) are interest-bearing obligations, which differentiates them from traditional tax credit bonds that provide bondholders

a tax credit in lieu of any interest payment. Build

America Bond (tax credit) proceeds must have been

used for capital expenditures and working capital

expenditures. Working capital expenditures included any costs that were not capital expenditures and

allowed for bonds to refund prior obligations and issue short-term financing. No Build America Bonds

(tax credit) were issued in 2009.

In 2009, State and local governments issued $3.7

billion in tax credit bonds. This amount included

nearly $3.4 billion in qualified school construction

bonds, a combined $192 million in clean renewable

energy bonds and Midwestern tax credit bonds, and

$179 million in qualified zone academy bonds.24

Figure J shows tax credit bonds classified by

purpose and size of entire issue. For 2009, tax credit

bond issuance had the following distribution by

entire issue size: 21.7 percent of all tax credit bond

issues were under $1 million, almost 376.6 percent

were in the $1 million to $5 million range, and 40.7

percent were in excess of $5 million. More than

three-quarters (76.2 percent) of the total 378 tax

credit bonds issued were QSCBs. Qualified zone

academy bonds accounted for 17.4 percent of all tax

credit bonds issued in 2009. The combined issuance

of clean renewable energy bonds and Midwestern tax

credit bonds were 6.4 percent of all tax credit bonds

issued in 2009.

The top five States with the highest dollar issuance of tax credit bonds were California, Illinois,

Texas, Florida, and Louisiana (Figure K). Combined, these States issued slightly more than $1.4 billion (38.5 percent) of all tax credit bonds. California

issued the largest amount of tax credit bonds, accounting for $486 million (13.1 percent) of the total.

Illinois and Texas had similar amounts of tax credit

bond issuance, with $280 million (7.5 percent) and

$267 million (7.2 percent), respectively.

Direct Payment Bonds

In response to the domestic economic crisis, on

February 17, 2009, the 111th Congress enacted

ARRA in order to implement new programs and

policies aimed at bolstering the economy. Several

ARRA provisions had direct implications for the

municipal bond market, through creation of the direct payment BAB program. This program, autho-

Figure J

Tax Credit Bonds, by Bond Purpose and Size of Entire Issue, 2009

[Money amounts are in millions of dollars, except for size of entire issue, which is in whole dollars]

Size of entire issue

All issues

Bond purpose

Tax credit bonds, total [1]

$1,000,000

under

$5,000,000

Under

$1,000,000

$5,000,000

or more

Number

Amount

Number

Amount

Number

Amount

Number

Amount

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

378

3,724

82

45

142

334

154

3,345

Qualified school construction bonds

288

3,352

53

29

100

234

135

3,090

Clean renewable energy bonds and

Midwestern tax credit bonds [2]

Qualified zone academy bonds

24

192

5

3

10

25

9

165

66

179

24

13

32

76

10

90

[1] Includes data from governmental and private activity bond returns (Forms 8038-G and 8038) that specifically reference "qualified school construction," "clean renewable energy,"

"Midwestern tax credit," or "qualified zone academy" bonds.

[2] Clean renewable energy and Midwestern tax credit bonds were combined to avoid disclosure of individual issuer information.

NOTE: Detail may not add to totals because of rounding.

168

24

The 2009 data combine clean renewable energy bonds and Midwestern tax credit bonds to avoid taxpayer disclosure.

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure K

Tax Credit Bonds, for All States and Top Five

States, 2009

[Money amounts are in millions of dollars]

Total tax credit bonds [1]

State

All States

Number

Amount

(1)

(2)

Percentage

of total

amount

(3)

Rank

(4)

378

3,724

100.0

N/A

74

1,433

38.5

N/A

13

486

13.1

1

Illinois

9

280

7.5

2

Texas

21

267

7.2

3

Florida

6

221

5.9

4

Louisiana

25

179

4.8

5

Top Five States, total

California

N/A—Not applicable. Rank applies only to individual States.

[1] Includes data from governmental and private activity bond returns (Forms 8038-G

and 8038) that specifically reference "qualified school construction," "clean renewable

energy," "Midwestern tax credit," or "qualified zone academy" bonds.

NOTE: Detail may not add to totals because of rounding.

rized by IRC section 54AA, enabled State and local

governments to issue Federally subsidized taxable

bonds for qualified purposes to provide economic

stimulus and promote employment.

The BAB program applied to certain bonds issued between February 17, 2009, and January 1,

2011. BABs provided a direct subsidy payment to

the bond issuer. This direct payment to the issuer

equaled 35 percent of the total coupon interest payable to bondholders. BABs must have been qualified to receive credit payments under IRC section

54AA(g)(2), which imposed a set of requirements on

the issuer. Specifically, the bond must have been a

BAB issued before January 1, 2011, the bond’s excess proceeds over the required reserve fund are only

to be used for capital expenditures, and the bond issuer must have made an irrevocable election to have

these requirements apply.25

BABs may have been issued for any governmental purpose for which tax-exempt governmental

bonds were issued, but excess proceeds must have

been used on capital expenditures. Capital expenditures included the costs of acquiring, constructing, or

improving land, buildings, and equipment. In general, BAB proceeds could not have been used to refund

prior issue or fund short-term obligations.26

ARRA under IRC section 1400U-2 authorized

State and local governments to issue RZEDs (recovery zone economic development bonds). Issuers

of RZEDs received a direct subsidy payment in an

amount equal to 45 percent of the total coupon interest payable to the bondholders. Like BABs, RZEDs

must have been qualified to receive direct subsidy

payments. Specifically, the bond must have been a

BAB issued before January 1, 2011, the bond’s excess proceeds (as defined by IRC section 54A) over

the required reserve fund are only to be used for capital expenditures, the bond proceeds are to be used

for a qualified economic development purpose, and

the bond’s issuer designated its purpose.27 Unlike

BABs, RZEDs were subject to a national volume cap

of $10 billion and must finance projects in distressed

areas as designated by the issuer.28

For Calendar Year 2009, issuers of direct payment bonds were required to file Form 8038-G,

Information Return for Tax-Exempt Governmental

Obligations. Direct payment bond issuers were

required to attach a schedule that declared the type

and purpose of the bond. Additionally, direct payment bond issuers were required to attach a debt

service schedule with the following information:

the type of interest rate—variable or fixed, the frequency of interest payments, the total principal outstanding on each interest payment date, the credit

payment expected from the IRS, and the earliest

call date of the bond.

Figure L shows direct payment bond issuance

allowed under ARRA for 2009. A total of 911 direct payment bonds raised $65.3 billion in proceeds.

25

Internal Revenue Notice 2009-26 states, “100 percent of the excess of (i) the available project proceeds (as defi ned in section 54A to mean sale proceeds of such issue less

not more than two percent of such proceeds used to pay issuance costs plus investment proceeds thereon), over (ii) the amounts in a reasonably required reserve fund (within

the meaning of § 150(a)(3)) with respect to such issue, are to be used for capital expenditures.”

26 Internal Revenue Notice 2009-26 states, “Build America Bonds (direct payment) may be used to reimburse otherwise-eligible capital expenditures under Treas. Reg.

section 1.150-2 that were paid or incurred after the effective date of ARRA and that were fi nanced originally with temporary short-term fi nancing issued after the effective

date of ARRA, and such reimbursement will not be treated as a refunding issue under Treas. Reg. §§ 1.150-1(d) or 1.150-2(g).”

27 IRC Section 1400U-2(c) defi nes a qualified economic development purpose as expenditures for purposes of promoting development or other economic activity in a recovery zone, including (1) capital expenditures paid or incurred with respect to property located in the recovery zone, (2) expenditures for public infrastructure and construction of public facilities, and (3) expenditures for job training and educational programs.

28 See IRC section (b) for details.

169

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure L

total direct payment proceeds with $19.6 billion,

followed by transportation, which accounted for 28

percent of total proceeds, or $18.3 billion. Other significant purposes included utilities (10.7 percent) and

environment (6.3 percent), with $7.0 billion and $4.1

billion in proceeds, respectively.

In 2009, the overwhelming majority of direct

payment bonds were large issues, as shown in Figure

N. Nearly $52.5 billion (80.3 percent) of all bond

proceeds were attributable to bond issues with an

entire issue price in excess of $75 million. Another

$8.5 billion (13 percent) of bond proceeds were attributable to bonds with an entire issue price ranging from $25 million to under $75 million. Direct

payment bonds with an entire issue size of less than

$25 million accounted for just over $4.4 billion (6.7

percent) of total issuance.

As shown in Figure O, 15 states accounted for

$50.9 billion (78 percent) of total direct payment

bond issuance. The 2009 Census estimate for these

15 states, combined, was 61.2 percent of the U.S.

population. California had $15.9 billion in bond issuance, which made it the single largest issuer of

direct payment ARRA bonds. Nearly one quarter

(24.4 percent) of all direct payment bonds were is-

Direct Payment Bonds Allowed Under the

American Recovery and Reinvestment Act by

Bond Type, 2009

[Money amounts are in millions of dollars]

Bond type

Number

Amount

Percentage

of total

amount

(1)

(2)

(3)

911

65,326

100.0

Build America Bonds

862

64,855

99.3

Recovery Zone Economic

Development Bonds

49

471

0.7

Total [1]

[1] Includes bonds reported on the Form 8038-G, Information Return for Tax-Exempt

Governmental Obligations, with a specific reference to "Build America Bond" or

"Recovery Zone Economic Development Bond" in either their issue name or other

description.

BABs made up 99.3 percent of the total dollar

amount of direct payment bonds issued under ARRA

for 2009. There were 49 RZEDs, which made up

less than 1 percent (nearly $0.5 billion) of the total

dollar amount of direct payment bonds issued.

The $65.3 billion in direct payment bonds allowed under ARRA, by purpose, for 2009 are shown

in Figure M. Education constituted 30 percent of

Figure M

Direct Payment Bond Amounts Allowed Under the American Recovery and Reinvestment Act by Purpose, 2009

Billions of dollars

20

$19.6

$18.3

18

16

14

$11.6

12

10

8

$7.0

6

$4.1

4

$2.5

2

$1.9

$0.3

$0.1

H

Housing

i

anticipation

Bond

B d Anticipation

A

ti i ti

notes and Tax

tax

Notes

anticipation

Anticipation

Notes

notes

0

Ed

Education

ti

Transportation

T

t ti

Other

Oth

purposes [1]

Utilities

Utiliti

E

Environment

i

t

H

Health

lth

and hospital

P

Public

bli

safety

Bond purpose

170

[1] "Other purposes" refer to obligations for which a specific purpose either did not apply or was not clearly indicated on the Form 8038-G, Information Return for Tax-Exempt Governmental

Obligations.

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure N

Direct Payment Bonds Allowed Under the

American Recovery and Reinvestment Act

by Size of Entire Issue, 2009

Less than

$25 million

requested. Figure P shows 152 total credit payments

to issuers of direct payment bonds totaled 128.3 million in 2009. Credit payments to issuers of fixed rate

direct payment bonds were $123.3 million (96.1)

percent of the Forms 8038-CP filed in 2009.

Summary

$25 million under

$75 million

6.7%

13.0%

$65.3

Billion

80.3%

The American Recovery and Reinvestment Act of

2009 changed the landscape of the municipal bonds

market by introducing direct payment bonds through

the Build America Bond and the Recovery Zone

Economic Development Bond Programs. More than

900 direct payment bonds raised $65.3 billion in proceeds in 2009. ARRA also created qualified school

construction bonds, which raised nearly $3.4 billion

in proceeds for 288 qualifying public educational

facilities. However, the market was still dominated

by more than 22,000 tax-exempt governmental bonds

issued in 2009, raising $340.7 billion of proceeds

Figure O

$75 million or more

sued in California, while its population represents

a little more than 12 percent of the U.S. population.

In contrast, Florida and Pennsylvania issued $2.2

billion (3.4 percent) and more than $1.3 billion (2

percent) of all direct payment bonds, but their populations represent 6 percent and 4.1 percent of the

U.S. population, respectively. Texas had $7.1 billion

(10.8 percent) in bond issuance in 2009, making it

the second largest issuer of direct payment bonds.

New York and Illinois ranked 3rd and 4th in largest

amount of direct payment bond issuance, with $5.8

billion (8.9 percent) and $3.7 billion (5.7 percent),

respectively. As Figure O shows, Massachusetts had

six direct payment bonds issued for a total of almost

$2 billion in proceeds, averaging $327.7 million per

bond issued, which was significantly higher than the

national average of $71.7 million per bond issued.

Direct payment bond issuers are required to file

Form 8038-CP, Return for Credit Payments to Issuers of Qualified Bonds in order to receive payments.

Filing requirements for Form 8038-CP vary depending on whether the bond has a fixed or variable rate

of interest. Issuers of direct payment bonds must

file Form 8038-CP each time a credit payment is

Direct Payment Bonds Allowed Under the

American Recovery and Reinvestment Act for

All States and Top 15 States, 2009

[Money amounts are in millions of dollars]

All issues [1]

State of issue

Number

Amount

(1)

(2)

Percentage

of total

amount

(3)

Rank

(4)

All States

911

65,326

100.0

N/A

Top 15 States, total

453

50,934

78.0

N/A

California

68

15,918

24.4

1

Texas

39

7,072

10.8

2

New York

22

5,787

8.9

3

Illinois

86

3,700

5.7

4

Florida

22

2,209

3.4

5

New Jersey

13

2,174

3.3

6

Massachusetts

6

1,964

3.0

7

Ohio

36

1,873

2.9

8

Washington

28

1,851

2.8

9

Colorado

22

1,611

2.5

10

Missouri

32

1,380

2.1

11

Kentucky

28

1,366

2.1

12

Virginia

17

1,352

2.1

13

Maryland

15

1,344

2.1

14

Pennsylvania

19

1,333

2.0

15

N/A—Not applicable. Rank applies only to individual States.

[1] Bonds reported on the Form 8038-G, Information Return for Tax-Exempt

Governmental Obligations, with a specific reference to "Build America Bond" or

"Recovery Zone Economic Development Bond" in either their issue name or other

description.

171

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Figure P

Total Credit Payments to Issuers of Direct

Payment Bonds Allowed Under the American

Recovery and Reinvestment Act by Interest

Rate Type, 2009

[Money amounts are in millions of dollars]

Interest rate type

Credit payments for direct

payment bonds, total

Number

Amount

Percentage

of amount

(1)

(2)

(3)

152

128.3

100.0

Credit payments for fixed rate

direct payment bonds

129

123.3

96.1

Credit payments for variable

rate direct payment bonds

22

5.0

3.9

NOTE: Detail may not add to totals because of rounding.

for public projects such as schools, transportation

infrastructure, and utilities. Of the $262.4 billion of

long-term governmental bonds issued, $151.1 billion

of proceeds were used to finance new projects, while

the remaining $111.4 billion of proceeds refunded

prior governmental bond issues. In addition, more

than 2,700 tax-exempt private activity bonds were

issued in 2009, for a total $105.6 billion in proceeds.

These tax-exempt private activity bond proceeds financed qualified private facilities (such as residential

rental facilities, single family housing, and airports),

as well the facilities of IRC section 501(c)(3) organizations (such as hospitals and private universities).

Of the $102.8 billion of long-term private activity

bonds issued, $52.2 billion of proceeds were used to

finance new projects, while the remaining $50.6 billion of proceeds refunded prior tax-exempt private

activity bond issues.

development bonds” in either the issue name or other

description. Data for tax credit bonds are based on

Forms 8038 and 8038-G with a specific reference to

“qualified school construction,” “clean renewable energy,” “qualified zone academy,” or “Midwestern tax

credit” bonds. Data for credit payments are based on

Forms 8038-CP filed for interest paid to bondholders

in 2009. Bond issuers were required to file Forms

8038 and 8038-G by the 15th day of the second calendar month after the close of the calendar quarter in

which the bond was issued. The filing deadline for

Form 8038-CP varied based on the structure of the

interest payments. In an effort to include as many

applicable returns for a particular year, each of the

respective study periods extended well beyond established filing deadlines. The Forms 8038-G and 8038

data include returns processed from January 1, 2009,

to April 30, 2011, for bonds issued in 2009. The

Form 8038-CP data include returns processed from

May 2009 to May 2, 2011, for interest paid in 2009.

Where possible, data from amended returns filed

and processed before the cutoff dates were included.

Late-filed returns processed after the respective cutoff dates were not included in the statistics.

During statistical processing, returns were subject to thorough testing and correction procedures to

ensure data accuracy and validity. Additional checks

were conducted to identify and exclude duplicate

returns. Wherever possible, returns with incomplete

information, mathematical errors, or other reporting

anomalies were edited to resolve internal inconsistencies. However, in other cases, it was not possible

to reconcile reporting discrepancies. Thus, some reporting and processing error may remain.

Explanation of Selected Terms

Data Sources and Limitations

The data presented in this article are based on the

populations of Forms 8038 and 8038-G filed with

the Internal Revenue Service for bonds issued during

Calendar Year 2009. Tax-exempt bond data exclude

returns filed for commercial paper transactions, as

well as issues that are loans from the proceeds of

another tax-exempt bond issue, pooled financings.

Data for taxable bonds issued under the American Recovery and Reinvestment Act of 2009 are

based on Forms 8038-G with a specific reference to

“Build America Bonds” or “recovery zone economic

172

American Recovery and Reinvestment Act of

2009 (“ARRA”)—An act of the 111th Congress

passed on February 17, 2009, in response to the

economic crisis. The passage of ARRA added to

the Internal Revenue Code (IRC) sections 54AA

and 1400U-1 through 1400U-3, authorizing State

and local governments to issue two general types

of Build America Bonds, recovery zone economic

development bonds, and recovery zone exempt facility bonds.

Arbitrage bond—A bond where at the time of

issuance, the issuer of the bond intentionally uses all

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

proceeds or a portion of its proceeds for the purpose

of acquiring a higher yield or to replace funds which

are used to acquire higher yielding investments.

Bond anticipation note (“BAN”)—A type of

short-term Governmental bond issue, the proceeds of

which are generally used to pay the startup costs associated with a future, long-term bond-financed project. A renewal BAN can be issued on maturity of an

outstanding BAN, until, eventually, the proceeds of

the future bond issue are used to pay off, or retire, the

outstanding BAN.

Build America Bond (“BAB”)—The American

Recovery and Reinvestment Act (ARRA) added

IRC section 54AA to enable State and local governments to issue bonds for authorized purposes to promote economic recovery and job creation. These

new types of bonds would be issued as taxable

governmental bonds with federal subsidies to help

offset a portion of issuers’ borrowing costs. The

two distinct types of Build America Bonds—Build

America Bond tax credit and Build America Bond

direct payment subsidy—vary by the structure of

federal subsidy. For calendar year 2009, issuers

of Build America Bonds were required to file IRS

Form 8038-G, Information Return for Tax-Exempt

Governmental Obligations.

Build America Bond tax credit bond—This

type of BAB provides a tax credit to investors in

an amount equal to 35 percent of the total coupon

interest payable by the issuer of the taxable government bonds.

Build America Bond direct payment bond—

This type of BAB provides a refundable credit

payment to state or local governmental issuers in

an amount equal to 35 percent of the total coupon

interest payable to investors.

Clean renewable energy bond (“CREB”)—A

type of tax credit bond used to finance eligible clean

renewable energy projects which are subject to a national volume cap. Issuers of clean renewable energy

bonds under IRC Section 54 must be eligible to apply

for volume cap allocations. Clean renewable energy

bonds were first authorized under the Energy Tax Incentive Act of 2005. For additional information, see

Internal Revenue Notice 2007-26.

Commercial paper—Commercial paper consists

of short-term notes that are continually rolled-over.

Maturities average about 30 days but can extend up

to 270 days. Many localities use commercial paper

to raise cash needed for current transactions.

Enterprise zone facility bond—Established by

the passage of the Revenue Reconciliation Act of

1993, this type of exempt facility bond may be issued

for certain businesses in designated “empowerment

zones” or “enterprise communities.” These designations are made by the Secretaries of Agriculture and

Housing and Urban Development and last for a 10year period. The Taxpayer Relief Act of 1997 provided certain economically depressed census tracts

within the District of Columbia designation as the

“District of Columbia Enterprise Zone.” Qualified

enterprise zone facility bonds are generally subject to

the same rules as exempt facility bonds.

Exempt facility bond—Bond issue of which 95

percent or more of the net proceeds is used to finance

a tax-exempt facility (as listed in IRC sections 142(a)

(1) through (15) and 142(k)). These facilities include

airports, docks and wharves, mass commuting facilities, facilities for the furnishing of water, sewage

facilities, solid waste disposal facilities, qualified residential rental projects, facilities for the local furnishing of electric energy or gas, local district heating or

cooling facilities, qualified hazardous waste facilities,

high-speed intercity rail facilities, environmental enhancements of hydroelectric generating facilities, and

qualified public educational facilities.

Governmental bond—Any obligation that is not

a private activity bond (see below) and is issued by

a State or local government unit. The interest on a

governmental bond is excluded from gross income

under IRC section 103.

Gulf Opportunity Zone bond—The Gulf Opportunity Zone Act of 2005, signed into law as Public

Law 109-135 on December 21, 2005, authorized a

new category of tax-exempt bonds. The proceeds of

such bonds are used to finance the construction and

rehabilitation of certain residential and nonresidential property located in certain localities of Alabama,

Louisiana, and Mississippi, designated as the “Gulf

Opportunity Zone.” This area constitutes the portion

of the Hurricane Katrina disaster area, determined by

the President to warrant individual or individual and

public assistance from the Federal government, under

the Robert T. Stafford Disaster Relief and Emergency

Assistance Act.

IRC section 1400N(a)(2) defines a qualified Gulf

Opportunity Zone Bond as any bond issued as part of

an issue if it meets the following requirements: (1)

95 percent or more of the net proceeds is to be used

for qualified project costs, or such issue meets the

173

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

174

requirements of a qualified mortgage issue, except

as otherwise provided in IRC section 1400N(a); (2)

such bond is issued by the State of Alabama, Louisiana, or Mississippi or any political subdivision

thereof; (3) such bond is designated for purposes

of IRC section 1400N(a) either by the Governor, or

approved bond commission, of such State; (4) the

bond is issued after December 21, 2005, and before

January 1, 2012; and (5) no portion of the proceeds

of such issue is to be used to provide any property

described in IRC section 144(c)(6)(B).

Gulf Opportunity Zone bonds that meet the general requirements of a qualified mortgage bond issue,

and the proceeds of such bond issues that finance

residences located in the Gulf Opportunity Zone,

shall be treated as qualified mortgage bonds (“Gulf

Opportunity Zone Mortgage Bonds”), as described

in IRC section 1400N(a)(2)(A)(ii). The Act also

authorized the issuance of “Gulf Opportunity Zone

Advance Refunding Bonds,” which allow for an additional advance refunding for certain bonds, issued

by the States of Alabama, Louisiana, or Mississippi

(or any political subdivision thereof), and outstanding on August 28, 2005. This provision was effective

for bonds issued between December 21, 2005, and

January 1, 2012. (See Internal Revenue Service Notice 2006-41, Internal Revenue Bulletin 2006-18, for

additional information.)

Midwestern tax credit bond—A type of tax credit

bond whose issuers are located in specific counties

in Arkansas, Illinois, Indiana, Iowa, Missouri, Nebraska, and Wisconsin that were adversely affected

by severe storms, tornadoes, or flooding (collectively

referred to as “the Midwestern disaster area”). Midwestern tax credit bonds were only authorized for

issuance during Calendar Year 2009. See Internal

Revenue Notice 2008-109 for additional information.

New York Liberty Zone bonds—The Job Creation

and Worker Assistance Act of 2002 created Section

1400L of the Internal Revenue Code of 1986 to provide various tax benefits for the area of New York

City damaged or affected by the terrorist attack on

September 11, 2001. IRC section 1400L(d) authorizes the issuance of an additional type of exempt facility bond, namely, “Liberty Bonds.” Liberty Bonds

are subject to the following additional requirements:

(1) 95 percent or more of the net proceeds of such

issue must be used for qualified project costs; (2) the

bond must be issued by the State of New York or any

political subdivision thereof; (3) the Governor of the

State of New York or the Mayor of the City of New

York must designate the bond for purposes of section 1400L(d); and (4) the bond must be issued after

March 9, 2002, and before January 1, 2012. The

maximum aggregate face amount of bonds that may

be designated as Liberty Bonds is $8 billion.

Nongovernmental output property bond—Bonds

used to finance the acquisition of property used by a

nongovernmental entity in connection with an output facility (such as an electric or gas power project). This bond must meet additional tests under

IRC section 141(d).

Pooled financing— An arrangement whereby a

portion of the proceeds of a governmental bond issue

is used to make loans to other governmental units.

Private activity bond—Bond issue of which

more than 10 percent of the proceeds is used for any

private business use and more than 10 percent of the

payment of the principal or interest is either secured

by an interest in property to be used for private business use (or payment for such property) or is derived

from payments for property (or borrowed money)

used for a private business use. A bond is also considered a private activity bond if the amount of the

proceeds used to make or finance loans (other than

loans described in IRC section 141(c)(2)) to persons

other than governmental units exceeds the lesser of 5

percent of the proceeds or $5 million.

Qualified green building and sustainable design

project—Bond issue of which 95 percent or more of

the net proceeds is used to finance qualified green

building and sustainable design projects, as designated by the Secretary of the Treasury, after consultation

with the Administrator of the Environmental Protection Agency. The project must be nominated by a

State or local government, and the issuer must submit

a detailed application to the Treasury Department for

consideration, and, on approval, allocation of a specified issuance amount. Section 701 of the American

Jobs Creation Act of 2004 added IRC sections 142(a)

(14) and 142(l), authorizing up to $2 billion of taxexempt private activity bonds, not subject to the

unified volume cap, for qualified green building and

sustainable design projects, to be issued between December 31, 2004, and October 1, 2012. (See Internal

Revenue Service Notice 2006-41, Internal Revenue

Bulletin 2006-18, for additional information.)

Qualified highway or surface transfer freight

facility bond—Bond issue of which 95 percent or

more of the net proceeds is used to provide qualified

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

highway or surface freight transfer facilities. Section

11143 of the Safe, Accountable, Flexible, Efficient,

Transportation Equity Act: A Legacy for Users (SAFETEA-LU) Public Law 109-59, signed into law on

August 10, 2005, added IRC sections 142(a)(15) and

142(m). Section 142(m)(1) defines the term “qualified highway or surface freight transfer facilities” as:

(a) any surface transportation project that receives

Federal assistance under title 23, United States Code

(as in effect on August 10, 2005); (b) any project

for an international bridge or tunnel for which an

international entity authorized under Federal or

State law is responsible and that receives Federal

assistance under title 23, United States Code (as

so in effect); or, (c) any facility for the transfer of

freight from truck to rail or rail to truck (including

any temporary storage facilities directly related to

such transfers) that receives Federal assistance under either title 23 or title 49, United States Code (as

so in effect). This legislation authorized issuance of

up to $15 billion of such bonds, not subject to the

unified volume cap, applicable to bonds issued after

August 10, 2005. Allocation of the $15-billion national limitation is under the jurisdiction of the Department of Transportation. (See Internal Revenue

Service Notice 2006-45, Internal Revenue Bulletin

2006-20, for additional information.)

Qualified hospital bond—Type of qualified

section 501(c)(3) bond issue of which 95 percent

or more of the net proceeds are to be used to finance a hospital.

Qualified mortgage bond—Bond issue of which

the proceeds (except issuance costs and reasonably

required reserves) are used to provide financing assistance for single-family residential property, and

which meets the additional requirements in IRC section 143. Bond proceeds can be applied toward the

purchase, improvement, or rehabilitation of owneroccupied residences, as well as to finance qualified

home-improvement loans.

Qualified public educational facility bond—

Bond issue of which 95 percent or more of the net

proceeds is used to provide qualified public educational facilities, defined by IRC section 142(k)(1) as

any school facility that is: (a) part of a public elementary or secondary school; and (b) is owned by a

private, for-profit corporation under a public-private

partnership agreement with a State or local educational agency. Under a “public-private partnership

agreement,” the corporation agrees to construct, rehabilitate, refurbish, or equip a school facility and,

at the end of the term of the agreement, to transfer

the school facility to the State or local educational

agency for no additional consideration. Such bonds

are not subject to the unified volume cap; rather, the

annual State limit is equal to the lesser of $10 per

resident or $5 million.

Qualified redevelopment bond—Bond issue of

which 95 percent or more of the net proceeds is used

to finance certain specified real property acquisition

and redevelopment in blighted areas (see IRC section

144(c) for additional requirements).

Qualified section 501(c)(3) bond—Bonds issued

by State and local governments to finance the activities of charitable organizations that are tax-exempt

under IRC section 501(c)(3). A bond must meet

the following conditions to be classified as a section 501(c)(3) bond: 1) all property financed by the

net proceeds of the bond issue is to be owned by a

section 501(c)(3) organization or a governmental

unit; and 2) the bond would not be a private activity

bond if section 501(c)(3) organizations were treated

as governmental units with respect to their activities that are not related trades or businesses, and the

private activity bond definition was applied using a

5-percent threshold rather than a 10-percent threshold. The primary beneficiaries of these bonds are

private, nonprofit hospitals, colleges, and universities. A qualified hospital bond issue is one in which

95 percent or more of the net proceeds is to be used

for a hospital.

Qualified small issue bond—Bond issue generally not exceeding $1 million and of which 95 percent or more of the net proceeds is used to finance

the acquisition of land and depreciable property or

to refund such issues. In certain instances, an election to take certain capital expenditures into account

can increase the limit on bond size, from $1 million

to $10 million. These bonds may only be used to

finance manufacturing facilities and to benefit certain

first-time farmers.

Qualified student loan bond—Bond issue of

which 90 percent or more of the net proceeds is used

to make or finance student loans under a program

of general application subject to the Higher Education Act of 1965 (see IRC section 144(b)(1)(A) for

additional requirements) or of which 95 percent or

more of the net proceeds is used to make or finance

175

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

student loans under a program of general application

approved by the State (see Code section 144(b)(1)(B)

for additional requirements).

Qualified veterans’ mortgage bond— In general, a bond issue of which 95 percent or more of

the net proceeds is used to finance the purchase,

improvement, or rehabilitation of owner-occupied

residences for veterans who: 1) served prior to January 1, 1977; and 2) applied for such a mortgage prior

to the date 30 years after leaving active service or

January 31, 1985, whichever is later. The payment

of interest and principal must be secured by a general obligation of the State, and the bond must meet

certain of the requirements of IRC section 143. The

issuance of qualified veterans’ mortgage bonds was

limited to the following five states: Alaska, California, Oregon, Texas, and Wisconsin, each of which

had a veterans’ mortgage bond program in effect

prior to June 22, 1984.

Qualified zone academy bond (“QZAB”)—A

type of tax credit bond issued by a State or local government to finance certain eligible public school purposes authorized under IRC section 54E. QZABs are

subject to a national volume cap to be allocated by

the Treasury among the States. See Internal Revenue

Notice 2009-30 for additional information.

Recovery zone bond—The American Recovery

and Reinvestment Act (ARRA) added IRC Sections

1400U-1 through 1400U-3 authorizing State and

local governments to issue recovery zone bonds.

These bonds provide tax incentives through lower

borrowing costs and are intended to promote job creation and economic recovery in targeted areas particularly affected by employment declines. See Internal

Revenue Notice 2009-50 for additional information.

Recovery zone economic development bond—

Authorized under IRC section 1400U-2, this type of

bond provides for a deeper Federal subsidy through

a refundable credit payment to state or local governmental issuers in an amount equal to 45 percent

of the total coupon interest payable to investors. A

recovery zone economic development bond must be

176

a Build America Bond, the proceeds of which must

be used for one or more qualified economic development purposes. Recovery zone economic development bonds are allocated under a $10 billion national

bond volume cap. For Calendar Year 2009, issuers

of recovery zone exempt facility bonds were required

to file IRS Form 8038-G, Information Return for

Tax-Exempt Governmental Obligations.

Recovery zone exempt facility bond—Authorized under IRC section 1400U-3, which expanded

the definition of the term “exempt facility bond” to

include any recovery zone facility bond. A recovery

zone exempt facility bond must be a qualified private

activity bond under IRC Section 142, the proceeds of

which may be used to finance certain “recovery zone

property.” Recovery zone exempt facility bonds are

allocated under a $15 billion national bond volume

cap. For Calendar Year 2009, issuers of recovery

zone exempt facility bonds were required to file IRS

Form 8038, Information Return for Tax-Exempt Private Activity Bonds.

Tax credit bond—Tax credit bonds are not interest-bearing obligations. The holder of a tax credit

bond is generally allowed an annual Federal income

tax credit while the bond is outstanding. The amount

of the credit is equal to the face amount of the bond

multiplied by the credit rate of the bond. For additional information, see Internal Revenue Notice 2009-15.

Tax Reform Act transition property bond—A

bond issued under transitional rules contained in the

Tax Reform Act of 1986. Proceeds from bonds issued under these rules include issues used to fund

such items as pollution control facilities, parking

facilities, industrial parks, sports stadiums, and convention facilities. Proceeds from other bonds issued

under the transitional rules are included in this category only if they could not be identified as another

issue type.

NOTE: Additional tax-exempt bond data, including data for prior years, can be found on the

SOI’s Tax Stats web site: http://www.irs.gov/taxstats.

Click on “Tax-Exempt Bonds.”

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 1. Tax-Exempt Governmental Bonds, by Type and Term of

Issue, 2009

[Money amounts are in millions of dollars]

Type and term of issue

Number

Amount

22,363

All issues, total [1]

340,658

Short-term

6,462

78,217

Long-term

15,901

262,441

16,892

215,319

New money issues, total

Short-term

4,771

64,269

Long-term

12,121

151,050

7,703

125,339

Refunding issues, total

Short-term

2,406

13,948

Long-term

5,297

111,391

[1] A given bond issue can include both new money and refunding proceeds. Thus, the number of new money issues

plus the number of refunding issues will sometimes exceed the total number of issues. However, the money

amounts add to the totals.

NOTE: Detail may not add to totals because of rounding.

Table 2. Long-Term, Tax-Exempt Governmental Bonds, by Bond Purpose and Type of Issue, 2009

[Money amounts are in millions of dollars]

All issues

New money issues

Refunding issues

Bond purpose

Total [1]

Education

Health and hospital

Transportation

Number

Amount

Number

Amount

Number

Amount

(1)

(2)

(3)

(4)

(5)

(6)

15,901

262,441

12,121

151,050

5,297

111,391

5,455

72,365

4,005

45,935

1,884

26,430

333

5,272

264

2,637

96

2,635

1,014

31,784

791

20,089

384

11,696

Public safety

1,864

5,505

1,712

4,291

277

1,214

Environment

1,238

16,637

944

10,921

510

5,715

Housing

100

757

71

326

40

432

Utilities

2,149

37,919

1,546

18,169

953

19,749

Bond and tax/revenue anticipation notes

Other purposes [2]

275

1,903

246

1,612

54

291

4,613

90,300

3,383

47,072

1,844

43,228

[1] A given bond issue can include more than one purpose and can include both new money and refunding proceeds. Thus, the summation of number of issues by purpose or by type

of issue will sometimes exceed the total number of issues. However, the money amounts add to the totals.

[2] "Other purposes" refers to obligations for which a specific purpose either did not apply or was not clearly indicated on the Form 8038-G, Information Return for Tax-Exempt

Governmental Obligations.

NOTE: Detail may not add to totals because of rounding.

177

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Statistics of Income Bulletin | Fall 2011

Table 3. Computation of Lendable Proceeds for Long-Term, Tax-Exempt Governmental Bonds, by

Bond Purpose, 2009

[Money amounts are in millions of dollars]

Bond issuance

costs

Entire issue price

Bond purpose

Total [1]

Allocation

to reserve

fund

Credit

enhancement

Number

Amount

Number

Amount

Number

Amount

Number

(1)

(2)

(3)

(4)

(5)

(6)

(7)

15,901

262,441

10,485

2,458

1,786

403

1,132

5,455

72,365

3,718

731

875

124

213

333

5,272

192

48

22

6

27

Transportation

1,014

31,784

753

244

90

72

96

Public safety

1,864

5,505

692

68

73

9

58

Environment

1,238

16,637

892

140

112

10

118

Education

Health and hospital

Housing

100

757

69

10

3

[2]

14

Utilities

2,149

37,919

1,804

428

312

73

330

Bond and tax/revenue anticipation notes

Other purposes [3]

275

4,613

1,903

90,300

205

3,228

14

775

0

440

0

110

3

302

Bond purpose

Total [1]

Allocation

to reserve

fund—

continued

Total lendable

proceeds

Proceeds used to refund

prior issues

Nonrefunding

proceeds

Amount

Number

Amount

Number

Amount

Number

Amount

(8)

(9)

(10)

(11)

(12)

(13)

(14)

2,898

15,901

256,682

5,297

109,143

12,121

147,540

Education

254

5,455

71,257

1,884

26,061

4,005

45,195

Health and hospital

82

333

5,136

96

2,594

264

2,542

Transportation

698

1,014

30,770

384

11,231

791

19,539

Public safety

78

1,864

5,350

277

1,181

1,712

4,169

Environment

328

1,238

16,158

510

5,548

944

10,610

Housing

7

100

740

40

424

71

316

Utilities

769

2,149

36,648

953

19,138

1,546

17,511

Bond and tax/revenue anticipation notes

Other purposes [3]

7

275

1,882

54

283

246

1,600

674

4,613

88,740

1,844

42,683

3,383

46,058

[1] A given bond issue can include more than one purpose. Thus, the summation of number of issues by purpose will sometimes exceed the total number of issues. However, the

money amounts add to the totals.

[2] Indicates an amount less than $500,000.

[3] "Other purposes" refers to obligations for which a specific purpose either did not apply or was not clearly indicated on the Form 8038-G, Information Return for Tax-Exempt

Governmental Obligations .

NOTE: Detail may not add to totals because of rounding.

178

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Statistics of Income Bulletin | Fall 2011

Table 4. New Money Long-Term, Tax-Exempt Governmental Bonds, by Bond Purpose and Size of

Entire Issue, 2009

[Money amounts are in millions of dollars, except for size of entire issue, which is in whole dollars]

Size of entire issue

All issues

$500,000

under

Under

$500,000 [1]

Bond purpose

$1,000,000

under

$1,000,000

$5,000,000

Number

Amount

Number

Amount

Number

Amount

Number

Amount

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

12,121

151,050

4,423

1,042

1,390

953

2,982

6,612

4,005

45,935

1,379

332

405

281

912

2,065

Health and hospital

264

2,637

67

18

37

27

61

110

Transportation

791

20,089

238

50

68

44

188

303

Public safety

1,712

4,291

1,029

237

217

143

235

449

Environment

944

10,921

234

54

109

74

308

564

Housing

71

326

d

d

6

4

26

55

Utilities

1,546

18,169

288

69

192

124

533

1,149

Total [2]

Education

Bond and tax/revenue

anticipation notes

Other purposes [3]

246

1,612

d

d

36

25

124

272

3,383

47,072

1,173

268

346

231

821

1,644

Size of entire issue—continued

$5,000,000

$10,000,000

under

under

under

$10,000,000

$25,000,000

$75,000,000

Bond purpose

Total [2]

$25,000,000

$750,000,000

or more

Number

Amount

Number

Amount

Number

Amount

Number

Amount

(9)

(10)

(11)

(12)

(13)

(14)

(15)

(16)

1,192

7,461

1,007

13,331

658

23,282

469

98,370

Education

431

2,733

398

5,197

319

10,886

161

24,442

Health and hospital

37

224

27

386

16

473

19

1,399

Transportation

98

380

60

534

51

1,466

88

17,312

Public safety

95

408

70

672

42

843

24

1,539

Environment

114

512

92

863

43

1,005

44

7,849

Housing

5

35

6

79

4

96

d

d

Utilities

217

1,158

149

1,659

86

2,416

81

11,593

Bond and tax/revenue

anticipation notes

27

158

14

214

7

229

d

d

Other purposes [3]

353

1,854

332

3,726

198

5,869

160

33,480

d—Data deleted to avoid disclosure of information about specific bonds. However, the data are included in the appropriate totals.

[1] Forms 8038-G, Information Return for Tax-Exempt Governmental Obligations, with an entire issue price less than $100,000 are excluded from the study. Issuers of these bonds are

instructed to file Form 8038-GC, Information Return for Small Tax-Exempt Governmental Bond Issues, Leases, and Installment Sales. Statistics of Income (SOI) does not process data

from the Forms 8038-GC filed with the Internal Revenue Service.

[2] A given bond issue can include more than one purpose. Thus, the summation of number of issues by purpose will sometimes exceed the total number of issues. However, the

money amounts add to the totals.

[3] "Other purposes" refers to obligations for which a specific purpose either did not apply or was not clearly indicated on the Form 8038-G, Information Return for Tax-Exempt

Governmental Obligation Bonds.

NOTE: Detail may not add to totals because of rounding.

179

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 5. New Money Long-Term, Tax-Exempt Governmental Bonds, by State of Issue and Bond

Purpose, 2009

[Money amounts are in millions of dollars]

Bond purpose

Total [1]

State of issue

All States

Alabama

Alaska

Arizona

Arkansas

California

Colorado

Connecticut

Delaware

District of Columbia

Florida

Georgia

Hawaii

Idaho

Illinois

Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Maryland

Massachusetts

Michigan

Minnesota

Mississippi

Missouri

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina

South Dakota

Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia

Wisconsin

Wyoming

U.S. Possessions [2]

Footnotes at end of table.

180

Education

Health and hospital

Transportation

Number

Amount

Number

Amount

Number

Amount

Number

(1)

(2)

(3)

(4)

(5)

(6)

(7)

Amount

(8)

12,121

151,050

4,005

45,935

264

2,637

791

20,089

210

19

192

188

691

196

126

16

5

255

286

10

46

677

333

329

282

200

163

128

116

186

344

446

207

312

85

336

47

55

334

163

645

336

143

297

320

137

578

48

203

72

165

1,097

127

74

176

204

80

378

48

10

1,200

591

4,221

799

27,872

1,893

3,453

507

1,278

7,224

4,167

914

381

3,521

1,832

1,806

1,214

1,532

1,239

494

2,687

2,573

982

2,810

805

1,739

130

1,654

997

177

3,274

2,354

16,364

4,011

271

1,826

1,605

3,019

5,674

507

1,573

201

1,242

14,512

1,846

194

3,740

4,582

282

1,185

129

1,966

47

4

86

85

296

58

63

4

0

47

49

d

10

353

127

113

78

86

35

48

30

76

101

90

41

112

d

69

10

18

175

57

322

53

24

96

217

41

196

13

51

20

20

272

27

16

56

59

8

112

28

d

460

23

1,054

496

10,357

1,035

484

184

0

1,847

377

d

142

1,393

860

775

462

383

244

81

813

722

418

406

375

608

d

410

137

29

885

499

2,984

1,277

42

761

912

1,160

2,158

164

482

37

265

6,256

547

65

1,608

700

126

289

31

d

4

0

0

3

28

4

d

0

0

4

6

d

d

d

5

11

16

8

15

0

8

3

6

4

7

6

0

9

d

d

d

d

d

7

0

5

7

d

d

0

5

0

4

19

4

0

d

13

3

4

3

0

21

0

0

13

1,120

2

d

0

0

262

12

d

d

d

134

83

34

43

36

0

88

2

3

20

69

29

0

36

d

d

d

d

d

93

0

46

52

d

d

0

76

0

2

128

21

0

d

46

4

4

51

0

9

d

15

3

29

9

25

3

d

19

5

0

5

23

27

36

32

6

11

18

14

32

20

34

9

37

d

25

3

7

13

6

36

16

8

23

13

10

23

5

3

4

10

41

14

d

10

15

d

75

d

d

14

d

911

21

3,435

56

247

118

d

531

924

0

180

388

86

39

66

95

349

207

341

143

34

170

47

332

d

20

143

11

1,247

86

2,861

584

7

37

107

428

1,421

194

7

2

20

1,520

926

d

68

793

d

201

d

d

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 5. New Money Long-Term, Tax-Exempt Governmental Bonds, by State of Issue and Bond

Purpose, 2009—Continued

[Money amounts are in millions of dollars]

Bond purpose—continued

State of issue

All States

Alabama

Alaska

Arizona

Arkansas

California

Colorado

Connecticut

Delaware

District of Columbia

Florida

Georgia

Hawaii

Idaho

Illinois

Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Maryland

Massachusetts

Michigan

Minnesota

Mississippi

Missouri

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina

South Dakota

Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia

Wisconsin

Wyoming

U.S. Possessions [2]

Public safety

Environment

Housing

Utilities

Number

Amount

Number

Amount

Number

Amount

Number

Amount

(9)

(10)

(11)

(12)

(13)

(14)

(15)

(16)

1,712

4,291

944

10,921

71

326

1,546

18,169

29

d

39

11

64

29

31

6

0

42

55

0

8

53

63

17

25

18

48

27

28

46

48

29

44

50

10

24

4

9

56

44

89

117

3

62

18

25

61

8

47

8

27

117

16

12

31

28

28

52

d

d

43

d

128

37

645

35

32

5

0

247

87

0

3

36

90

22

18

60

43

11

96

29

22

102

74

95

16

93

25

5

101

45

383

292

3

37

151

92

180

8

44

46

54

214

15

2

95

115

8

48

d

d

4

0

8

27

33

7

19

3

d

13

71

d

6

20

27

22

31

7

11

6

37

36

70

38

d

15

18

5

10

8

10

9

30

16

7

20

d

11

112

7

10

d

3

26

11

16

21

9

6

52

4

d

6

0

265

94

3,720

92

21

62

d

313

912

d

22

28

208

185

34

2

214

2

475

338

194

117

d

15

24

2

352

13

102

32

619

124

4

50

d

205

426

60

83

d

8

196

35

8

502

315

29

101

6

d

d

0

0

0

8

3

d

d

0

4

d

0

0

d

d

0

0

0

0

0

5

d

d

6

0

0

0

0

0

0

d

d

d

d

3

d

0

d

d

d

0

5

3

d

0

0

d

3

0

3

0

d

d

0

0

0

91

4

d

d

0

8

d

0

0

d

d

0

0

0

0

0

39

d

d

45

0

0

0

0

0

0

d

d

d

d

7

d

0

d

d

d

0

4

16

d

0

0

d

3

0

1

0

d

44

d

15

42

63

20

9

d

0

50

20

d

d

46

18

34

47

34

19

5

10

36

28

62

6

33

30

33

d

d

6

13

23

29

68

16

23

13

27

4

24

14

49

329

15

18

17

29

10

96

5

d

339

d

1,209

98

3,242

262

286

d

0

1,146

122

d

d

113

249

28

222

229

50

2

86

57

119

170

16

372

23

974

d

d

28

973

878

648

183

105

261

143

220

15

614

79

180

3,241

68

32

225

621

4

124

34

d

Footnotes at end of table.

181

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 5. New Money Long-Term, Tax-Exempt Governmental Bonds, by State of Issue and Bond

Purpose, 2009—Continued

[Money amounts are in millions of dollars]

Bond purpose—continued

State of issue

Bond and tax/revenue anticipation notes

Number

(17)

All States

Alabama

Alaska

Arizona

Arkansas

California

Colorado

Connecticut

Delaware

District of Columbia

Florida

Georgia

Hawaii

Idaho

Illinois

Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Maryland

Massachusetts

Michigan

Minnesota

Mississippi

Missouri

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina

South Dakota

Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia

Wisconsin

Wyoming

U.S. Possessions [2]

182

Other purposes [3]

Amount

(18)

Number

(19)

Amount

(20)

246

1,612

3,383

47,072

d

0

0

0

8

0

0

0

0

3

d

0

8

0

d

12

13

7

3

12

4

d

d

18

d

0

5

17

0

3

3

0

10

d

0

d

d

4

18

d

0

d

23

d

0

d

6

14

d

13

0

0

d

0

0

0

153

0

0

0

0

20

d

0

15

0

d

55

22

33

3

42

13

d

d

42

d

0

7

16

0

12

3

0

735

d

0

d

d

21

49

d

0

d

67

d

0

d

47

91

d

85

0

0

74

11

40

23

179

66

63

5

d

79

85

4

d

193

62

101

93

34

21

25

57

101

66

177

95

60

17

161

13

12

80

31

133

112

30

91

55

28

146

17

65

18

47

297

47

10

47

46

19

124

7

7

314

135

653

40

5,109

407

2,361

134

d

2,850

1,725

775

d

1,546

185

620

356

686

301

150

736

1,272

188

1,738

221

290

58

103

331

98

902

705

7,826

952

23

764

118

951

1,215

64

268

23

630

2,955

233

82

1,182

1,896

26

334

4

1,870

d—Data deleted to avoid disclosure of information about specific bonds. However, the data are included in the appropriate totals.

[1] A given bond issue can include more than one purpose. Thus, the summation of number of issues by purpose will sometimes exceed the total number of issues. However, the

money amounts add to the totals.

[2] U.S. Possessions include Guam, Puerto Rico, and the U.S. Virgin Islands.

[3] "Other purposes" refers to obligations for which a specific purpose either did not apply or was not clearly indicated on the Form 8038-G, Information Return for Tax-Exempt

Governmental Obligations.

NOTE: Detail may not add to totals because of rounding.

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 6. Tax-Exempt Private Activity Bonds, by Type and Term of

Issue, 2009

[Money amounts are in millions of dollars]

Type and term of issue

All issues, total [1]

Number

Amount

2,732

105,575

Short-term

66

2,790

Long-term

2,666

102,785

1,662

52,425

New money issues, total

Short-term

36

209

Long-term

1,626

52,216

1,421

53,150

Refunding issues, total

Short-term

36

2,581

Long-term

1,385

50,569

[1] A given bond issue can include both new money and refunding proceeds. Thus, the number of new money

issues plus the number of refunding issues will sometimes exceed the total number of issues. However, the money

amounts add to the totals.

NOTE: Detail may not add to totals because of rounding.

183

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 7. Long-Term, Tax-Exempt Private Activity Bonds, by Bond Purpose and Type of Issue, 2009

[Money amounts are in millions of dollars]

All issues

Bond purpose

New money issues

Refunding issues

Number

Amount

Number

Amount

Number

Amount

(1)

(2)

(3)

(4)

(5)

(6)

Total [1]

2,666

102,785

1,626

52,216

1,385

50,569

Airports

65

6,474

38

3,341

38

3,133

Docks and wharves

16

931

9

385

8

546

Water, sewage, and solid waste disposal

facilities

Qualified residential rental facilities

128

6,983

61

3,616

70

3,367

193

3,832

121

2,407

80

1,425

Local electricity or gas furnishing facilities

6

247

3

230

3

17

Tax Reform Act of 1986 transition property

bonds

Qualified enterprise zone facility bonds

57

3,668

3

61

56

3,606

5

44

d

d

d

d

d

d

d

d

0

0

d

d

d

d

0

0

d

d

d

d

0

0

42

1,493

39

1,274

11

219

39

1,600

25

1,130

15

469

7

30

d

d

d

d

d

d

d

d

d

d

d

d

d

d

d

d

District of Columbia Enterprise Zone facility

bonds

Qualified highway or surface freight transfer

facilities

Qualified New York Liberty bonds

2008 Housing Act bonds issued under IRC

section 142 or 143

Qualified Gulf Opportunity Zone and

Gulf Opportunity Zone mortgage bonds

Local district heating or cooling facilities

Environmental enhancements of

hydroelectric generating facilities

Midwest disaster area exempt facility bonds

Hurricane Ike disaster area exempt facility

bonds

Recovery zone exempt facility bonds

d

d

d

d

d

d

17

95

17

95

0

0

Qualified mortgage bonds

84

5,003

61

2,404

50

2,600

Qualified veterans' mortgage bonds

d

d

d

d

0

0

422

720

315

446

111

274

Qualified small issue bonds

Qualified student loan bonds

12

1,890

12

1,309

4

581

Qualified hospital facilities

402

33,292

247

14,070

240

19,222

1,203

32,470

689

17,830

729

14,640

d

d

d

d

d

d

11

668

7

260

4

408

Qualified section 501(c)(3) nonhospital

bonds

Nongovernmental output property bonds

Other purposes [2]

d—Data deleted to avoid disclosure of information about specific bonds. However, the data are included in the appropriate totals.

[1] A given bond issue can include more than one purpose and can include both new money and refunding proceeds. Thus, the summation of number of issues by purpose or by type

of issue will sometimes exceed the total number of issues. However, the money amounts add to the totals.

[2] For this table, "other purposes" refers to obligations for which a specific purpose either did not apply or was not clearly indicated on the Form 8038, Information Return for TaxExempt Private Activity Bond Issues.

NOTE: Detail may not add to totals because of rounding.

184

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 8. Computation of Lendable Proceeds for Long-Term, Tax-Exempt Private Activity Bonds, by

Selected Bond Purpose, 2009

[Money amounts are in millions of dollars]

Selected bond purpose

Entire issue price

Number

(1)

Bond issuance costs

Amount

(2)

Number

(3)

Allocation

to reserve

fund

Credit enhancement

Amount

(4)

Number

(5)

Amount

(6)

Number

(7)

Total [1]

2,666

102,785

1,326

754

246

113

314

Airports

65

6,474

52

52

9

4

26

Docks and wharves

16

931

d

d

d

d

6

Water, sewage, and solid waste disposal

facilities

128

6,983

48

31

8

12

9

Qualified residential rental facilities

193

3,832

47

8

13

4

9

2008 Housing Act bonds issued under IRC

section 142 or 143

42

1,493

d

d

d

d

9

Qualified Gulf Opportunity Zone and

Gulf Opportunity Zone mortgage bonds

39

1,600

16

11

d

d

d

Recovery Zone exempt facility bonds

17

95

d

d

d

d

0

Qualified mortgage bonds

84

5,003

27

17

3

1

19

Qualified small issue bonds

422

720

86

6

d

d

d

Qualified student loan bonds

12

1,890

d

d

d

d

9

Qualified hospital facilities

402

33,292

278

318

75

56

69

1,203

96

32,470

8,003

733

28

273

18

123

3

32

[2]

158

10

Qualified section 501(c)(3) nonhospital

bonds

All other bonds, combined [3]

Selected bond purpose

Allocation

to reserve

fund—

continued

Total lendable proceeds

Amount

Number

Amount

Number

Amount

Number

Amount

(8)

(9)

(10)

(11)

(12)

(13)

(14)

Proceeds used to refund prior

issues

Nonrefunding proceeds

Total [1]

1,549

2,666

100,369

1,385

49,773

1,681

50,596

Airports

249

65

6,168

38

3,026

39

3,143

Docks and wharves

25

16

899

8

536

9

364

52

4

128

193

6,888

3,815

70

80

3,362

1,423

62

121

3,527

2,393

10

42

1,479

11

216

39

1,263

d

0

26

d

63

625

39

17

84

422

12

402

1,580

93

4,960

713

1,817

32,292

15

0

50

111

4

240

469

0

2,587

274

570

18,802

25

17

61

317

12

263

1,110

93

2,373

439

1,247

13,490

480

5

1,203

96

31,685

7,980

729

71

14,425

4,085

725

28

17,260

3,895

Water, sewage, and solid waste disposal

facilities

Qualified residential rental facilities

2008 Housing Act bonds issued under IRC

section 142 or 143

Qualified Gulf Opportunity Zone and

Gulf Opportunity Zone mortgage bonds

Recovery Zone exempt facility bonds

Qualified mortgage bonds

Qualified small issue bonds

Qualified student loan bonds

Qualified hospital facilities

Qualified section 501(c)(3) nonhospital

bonds

All other bonds, combined [3]

d—Data deleted to avoid disclosure of information for specific bonds. However, the data are included in the appropriate totals.

[1] A given bond issue can include more than one purpose. Thus, the summation of number of issues by purpose will sometimes exceed the total number of issues. However, the

money amounts add to the totals.

[2] Indicates an amount less than $500,000.

[3] For purposes of this table, this category includes all issues for which a specific purpose either did not apply or was not clearly indicated on the Form 8038, Information Return for

Tax-Exempt Private Activity Bond Issues, as well as bonds issued for: local electricity or gas furnishing facilities, facilities issued under a transitional rule of the Tax Reform Act of

1986, qualified enterprise zone facilities, new empowerment zone facilities, District of Colombia Enterprise Zone facilities, qualified public educational facilities, qualified green building

and sustainable design projects, qualified highway or surface freight transfer facilities, New York Liberty Zone bonds, mass commuting facilities, local district heating and cooling

facilities, hazardous waste facilities, high-speed intercity rail facilities, environmental enhancements of hydroelectric generating facilities, Midwestern disaster exempt facilities,

Hurricane Ike disaster exempt facilities, Midwestern disaster mortgage bonds, Hurricane Ike disaster mortgage bonds, qualified veterans' mortgage bonds, qualified redevelopment

bonds, nongovernmental output property bonds, Gulf Opportunity Zone advanced refunding bonds, and New York Liberty Zone advanced refunding bonds.

NOTE: Detail may not add to totals because of rounding.

185

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 9. New Money Long-Term, Tax-Exempt Private Activity Bonds, by Selected Bond Purpose and

Size of Entire Issue, 2009

[Money amounts are in millions of dollars, except for size of entire issue, which is in whole dollars]

Size of entire issue

Selected bond purpose

Total [1]

Airports

Docks and wharves

Water, sewage, and solid waste

Qualified residential rental facilities

All issues

Under $1,000,000

$1,000,000 under

$5,000,000

$5,000,000 under

$10,000,000

Number

Amount

Number

Amount

Number

Amount

Number

Amount

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

1,626

38

9

61

121

52,216

3,341

385

3,616

2,407

268

0

0

5

d

70

0

0

2

d

319

3

d

8

23

892

8

d

26

89

254

6

0

9

28

1,608

44

0

61

199

39

1,274

0

0

d

d

5

38

25

17

61

315

12

247

1,130

95

2,404

446

1,309

14,070

0

d

d

222

0

4

0

d

d

46

0

3

3

d

d

59

0

32

9

d

d

154

0

107

d

5

0

26

0

27

d

36

0

167

0

158

689

28

17,830

3,910

25

4

14

3

169

6

420

22

145

d

863

d

2008 Housing Act bonds issued under

IRC section 142 or 143

Qualified Gulf Opportunity Zone and

Gulf Opportunity Zone mortgage bonds

Recovery Zone exempt facility bonds

Qualified mortgage bonds

Qualified small issue bonds

Qualified student loan bonds

Qualified hospital facilities

Qualified section 501(c)(3) nonhospital

bonds

All other bonds, combined [2]

Size of entire issue—continued

Selected bond purpose

Total [1]

$10,000,000 under

$25,000,000

$25,000,000 under

$50,000,000

$50,000,000 under

$100,000,000

$100,000,000

or more

Number

Amount

Number

Amount

Number

Amount

Number

Amount

(9)

(10)

(11)

(12)

(13)

(14)

(15)

(16)

282

7

d

3,580

97

d

154

6

d

4,517

248

d

160

3

3

9,117

188

212

189

13

d

32,430

2,756

d

Qualified residential rental facilities

4

43

66

641

8

14

235

435

13

d

900

d

14

6

2,325

763

2008 Housing Act bonds issued under

IRC section 142 or 143

7

119

9

299

7

359

d

d

Recovery Zone exempt facility bonds

Qualified mortgage bonds

Qualified small issue bonds

Qualified student loan bonds

7

3

4

8

0

118

30

86

80

0

d

0

17

0

d

d

0

336

0

d

6

0

22

0

d

416

0

904

0

d

3

0

12

0

6

550

0

1,074

0

1,004

Qualified hospital facilities

38

477

27

727

41

2,170

78

10,428

157

d

1,780

d

71

d

2,025

d

62

4

3,301

231

60

8

9,426

3,565

Airports

Docks and wharves

Water, sewage, and solid waste

disposal facilities

Qualified Gulf Opportunity Zone and

Gulf Opportunity Zone mortgage bonds

Qualified section 501(c)(3) nonhospital

bonds

All other bonds, combined [2]

d—Data deleted to avoid disclosure of information for specific bonds. However, the data are included in the appropriate totals.

[1] A given bond issue can include more than one purpose. Thus, the summation of number of issues by purpose will sometimes exceed the total number of issues. However, the

money amounts add to the totals.

[2] For purposes of this table, this category includes all issues for which a specific purpose either did not apply or was not clearly indicated on the Form 8038, Information Return for

Tax-Exempt Private Activity Bond Issues, as well as bonds issued for: local electricity or gas furnishing facilities, facilities issued under a transitional rule of the Tax Reform Act of

1986, qualified enterprise zone facilities, new empowerment zone facilities, District of Colombia Enterprise Zone facilities, qualified public educational facilities, qualified green building

and sustainable design projects, qualified highway or surface freight transfer facilities, New York Liberty Zone bonds, mass commuting facilities, local district heating and cooling

facilities, hazardous waste facilities, high-speed intercity rail facilities, environmental enhancements of hydroelectric generating facilities, Midwestern disaster exempt facilities,

Hurricane Ike disaster exempt facilities, Midwestern disaster mortgage bonds, Hurricane Ike disaster mortgage bonds, qualified veterans' mortgage bonds, qualified redevelopment

bonds, nongovernmental output property bonds, Gulf Opportunity Zone advanced refunding bonds, and New York Liberty Zone advanced refunding bonds.

NOTE: Detail may not add to totals because of rounding.

186

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 10. New Money Long-Term, Tax-Exempt Private Activity Bonds, by State of Issue and Selected

Bond Purpose, 2009

[Money amounts are in millions of dollars]

Selected bond purpose

Total [1]

State of issue

All States

Alabama

Alaska

Arizona

Arkansas

California

Colorado

Connecticut

Delaware

District of Columbia

Florida

Georgia

Hawaii

Idaho

Illinois

Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Maryland

Massachusetts

Michigan

Minnesota

Mississippi

Missouri

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina

South Dakota

Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia

Wisconsin

Wyoming

U.S. Possessions [4]

Footnotes at end of table.

Airports, docks, and

wharves [2]

Water, sewage, and solid

waste disposal facilities

Qualified residential

rental facilities

Number

Amount

Number

Amount

Number

Amount

Number

(1)

(2)

(3)

(4)

(5)

(6)

(7)

1,626

30

d

14

9

117

35

10

d

9

54

44

4

7

97

24

135

44

22

29

10

31

73

22

58

18

40

6

26

d

11

41

11

90

21

12

50

10

18

109

5

16

12

32

53

10

13

26

41

16

48

3

d

52,216

613

d

364

181

7,389

1,099

338

d

437

2,102

1,014

407

210

3,007

1,162

470

394

493

941

260

542

2,389

797

511

517

871

47

118

d

417

1,523

462

7,582

931

136

1,759

216

337

2,967

245

350

133

537

2,620

375

70

1,440

906

407

1,273

161

d

47

d

0

d

0

9

d

d

0

d

9

0

0

0

0

d

0

0

0

d

0

0

0

d

0

0

d

d

0

d

0

d

0

4

0

d

0

d

3

0

0

0

0

0

4

0

0

0

d

0

d

0

0

3,727

d

0

d

0

1,342

d

d

0

d

544

0

0

0

0

d

0

0

0

d

0

0

0

d

0

0

d

d

0

d

0

d

0

442

0

d

0

d

37

0

0

0

0

0

374

0

0

0

d

0

d

0

0

61

4

0

d

d

5

0

d

0

0

5

4

d

0

d

d

0

0

d

0

d

0

0

0

0

0

d

0

0

0

0

d

0

d

d

0

3

0

d

6

0

0

d

0

4

d

0

d

d

d

0

d

d

3,616

49

0

d

d

163

0

d

0

0

490

197

d

0

d

d

0

0

d

0

d

0

0

0

0

0

d

0

0

0

0

d

0

d

d

0

377

0

d

614

0

0

d

0

359

d

0

d

d

d

0

d

d

Amount

(8)

121

d

0

0

0

33

0

d

0

d

6

d

d

0

5

0

0

0

0

d

0

3

6

d

0

d

3

d

0

0

0

d

d

25

d

0

4

0

5

0

0

d

0

3

3

d

d

0

4

0

d

0

0

2,407

d

0

0

0

401

0

d

0

d

56

d

d

0

44

0

0

0

0

d

0

35

131

d

0

d

47

d

0

0

0

d

d

1,194

d

0

43

0

61

0

0

d

0

18

44

d

d

0

25

0

d

0

0

187

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 10. New Money Long-Term, Tax-Exempt Private Activity Bonds, by State of Issue and Selected

Bond Purpose, 2009—Continued

[Money amounts are in millions of dollars]

Selected bond purpose—continued

State of issue

All States

Alabama

Alaska

Arizona

Arkansas

California

Colorado

Connecticut

Delaware

District of Columbia

Florida

Georgia

Hawaii

Idaho

Illinois

Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Maryland

Massachusetts

Michigan

Minnesota

Mississippi

Missouri

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina

South Dakota

Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia

Wisconsin

Wyoming

U.S. Possessions [4]

Footnotes at end of table.

188

2008 Housing Act

bonds issued under

IRC section 142 or 143

Qualified Gulf Opportunity Zone

bonds and Gulf Opportunity

Zone mortgage bonds

Recovery Zone exempt facility

bonds

Qualified mortgage bonds

Qualified small

issue bonds

Number

Amount

Number

Amount

Number

Amount

Number

Amount

Number

(9)

(10)

(11)

(12)

(13)

(14)

(15)

(16)

(17)

39

0

0

0

0

3

0

d

0

0

0

0

0

0

0

0

d

0

0

0

d

d

d

0

0

d

5

0

0

d

0

d

0

3

0

0

0

0

0

d

0

0

d

d

d

0

3

3

5

0

d

0

0

1,274

0

0

0

0

42

0

d

0

0

0

0

0

0

0

0

d

0

0

0

d

d

d

0

0

d

122

0

0

d

0

d

0

187

0

0

0

0

0

d

0

0

d

d

d

0

9

131

82

0

d

0

0

25

4

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

11

0

0

0

0

0

10

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

1,130

172

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

511

0

0

0

0

0

447

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

17

d

0

0

0

d

0

0

0

0

0

d

0

0

0

d

0

0

0

d

0

0

0

d

d

0

d

0

0

0

0

0

0

0

d

0

d

0

0

d

0

0

0

0

0

0

0

0

d

0

0

0

0

95

d

0

0

0

d

0

0

0

0

0

d

0

0

0

d

0

0

0

d

0

0

0

d

d

0

d

0

0

0

0

0

0

0

d

0

d

0

0

d

0

0

0

0

0

0

0

0

d

0

0

0

0

61

0

d

0

0

d

d

d

d

0

d

d

0

d

d

0

0

d

0

d

4

d

d

d

0

d

3

0

5

d

d

0

5

d

0

d

3

3

0

d

d

0

d

3

d

d

0

0

d

d

0

0

0

2,404

0

d

0

0

d

d

d

d

0

d

d

0

d

d

0

0

d

0

d

79

d

d

d

0

d

9

0

1

d

d

0

184

d

0

d

84

84

0

d

d

0

d

130

d

d

0

0

d

d

0

0

0

315

d

0

d

d

d

10

0

0

0

d

d

0

0

42

d

103

d

0

d

0

d

6

0

4

d

8

0

13

0

0

11

0

3

d

d

d

d

d

23

0

0

7

4

3

0

d

d

d

0

8

0

0

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 10. New Money Long-Term, Tax-Exempt Private Activity Bonds, by State of Issue and Selected

Bond Purpose, 2009—Continued

[Money amounts are in millions of dollars]

Selected bond purpose—continued

State of issue

Qualified

small issue

bonds—

continued

Qualified student

loan bonds

Qualified hospital

facilities

Qualified section 501(c)(3)

nonhospital bonds

All other bonds,

combined [3]

Amount

Number

Amount

Number

Amount

Number

Amount

Number

Amount

(18)

(19)

(20)

(21)

(22)

(23)

(24)

(25)

(26)

All States

446

12

1,309

247

14,070

689

17,830

28

3,910

Alabama

d

0

0

7

273

8

34

0

0

Alaska

0

0

0

d

d

0

0

d

d

Arizona

d

0

0

3

100

6

229

0

0

Arkansas

d

0

0

d

d

4

45

0

0

California

d

0

0

18

1,793

44

3,626

0

0

Colorado

22

0

0

d

d

21

277

0

0

Connecticut

0

d

d

d

d

d

d

0

0

Delaware

0

0

0

d

d

0

0

d

d

District of Columbia

0

0

0

d

d

d

d

d

d

Florida

d

0

0

6

528

23

307

d

d

Georgia

d

0

0

5

61

29

687

0

0

Hawaii

0

0

0

0

0

d

d

d

d

Idaho

0

0

0

d

d

d

d

0

0

Illinois

36

d

d

16

1,112

33

1,674

d

d

Indiana

d

0

0

7

662

11

253

0

0

Iowa

19

d

d

6

117

d

d

6

183

Kansas

d

0

0

3

131

11

137

0

0

Kentucky

0

0

0

3

263

d

d

0

0

Louisiana

d

0

0

d

d

8

181

d

d

Maine

0

d

d

0

0

3

105

0

0

Maryland

d

0

0

d

d

22

388

0

0

Massachusetts

19

d

d

15

491

43

1,369

0

0

Michigan

0

0

0

11

575

8

63

0

0

Minnesota

6

0

0

3

70

50

426

d

d

Mississippi

d

0

0

0

0

6

35

0

0

Missouri

6

0

0

5

231

16

307

d

d

Montana

0

0

0

d

d

d

d

0

0

Nebraska

8

0

0

3

16

5

93

0

0

Nevada

0

0

0

0

0

0

0

d

d

New Hampshire

0

0

0

6

211

d

d

0

0

New Jersey

40

d

d

5

625

18

160

d

d

New Mexico

0

d

d

d

d

d

d

0

0

New York

8

d

d

16

282

35

2,557

d

d

North Carolina

d

0

0

8

579

8

319

0

0

North Dakota

d

0

0

0

0

d

d

0

0

Ohio

d

0

0

15

1,008

19

208

0

0

Oklahoma

d

0

0

0

0

4

79

0

0

Oregon

d

0

0

d

d

5

52

d

d

Pennsylvania

44

0

0

18

1,146

58

795

0

0

Rhode Island

0

d

d

d

d

d

d

0

0

South Carolina

0

d

d

3

105

10

122

0

0

South Dakota

5

0

0

d

d

0

0

0

0

Tennessee

17

0

0

d

d

20

189

d

d

Texas

16

d

d

8

278

26

887

3

505

Utah

0

0

0

d

d

5

275

0

0

Vermont

d

0

0

d

d

5

33

0

0

Virginia

d

0

0

5

484

14

399

d

d

Washington

d

0

0

6

497

13

162

d

d

West Virginia

0

0

0

9

151

3

48

d

d

Wisconsin

36

0

0

13

510

27

421

0

0

Wyoming

0

0

0

0

0

d

d

0

0

U.S. Possessions [4]

0

0

0

0

0

0

0

0

0

d—Data deleted to avoid disclosure of information about specific bonds. However, the data are included in the appropriate totals.

[1] A given bond issue can include more than one purpose. Thus, the summation of number of issues by purpose will sometimes exceed the total number of issues. However, the

money amounts add to the totals.

[2] For purposes of this table, certain bond purposes were combined. For this reason, data in this table will differ slightly from the data in Tables 7 and 9.

[3] For purposes of this table, this category includes all issues for which a specific purpose either did not apply or was not clearly indicated on the Form 8038, Information Return for

Tax-Exempt Private Activity Bond Issues, as well as bonds issued for: local electricity or gas furnishing facilities, facilities issued under a transitional rule of the Tax Reform Act of 1986,

qualified enterprise zone facilities, new empowerment zone facilities, District of Colombia Enterprise Zone facilities, qualified public educational facilities, qualified green building and

sustainable design projects, qualified highway or surface freight transfer facilities, New York Liberty Zone bonds, mass commuting facilities, local district heating and cooling facilities,

hazardous waste facilities, high-speed intercity rail facilities, environmental enhancements of hydroelectric generating facilities, Midwestern disaster exempt facilities, Hurricane Ike

disaster exempt facilities, Midwestern disaster mortgage bonds, Hurricane Ike disaster mortgage bonds, qualified veterans' mortgage bonds, qualified redevelopment bonds,

nongovernmental output property bonds, Gulf Opportunity Zone advanced refunding bonds, and New York Liberty Zone advanced refunding bonds.

[4] U.S. Possessions include Guam.

NOTE: Detail may not add to totals because of rounding.

189

Municipal Bonds, 2009

Statistics of Income Bulletin | Fall 2011

Table 11. Direct Payment Bonds Allowed Under the American Recovery and Reinvestment Act by Bond

Purpose and Size of Entire Issue, 2009

[Money amounts are in millions of dollars, except for size of entire issue, which is in whole dollars]

Size of entire issue

All issues

$1,000,000

Under

$1,000,000

Bond purpose

$5,000,000

under

under

$5,000,000

$10,000,000

Number

Amount

Number

Amount

Number

Amount

Number

(1)

(2)

(3)

(4)

(5)

(6)

(7)

Total [1, 2]

911

65,326

40

28

194

510

138

Education

315

19,575

8

5

43

107

44

Health and hospital

31

2,499

d

d

6

13

d

Transportation

137

18,270

10

5

28

52

18

Public safety

78

1,863

9

4

23

38

15

Environment

95

4,132

5

1

16

31

15

Housing

15

286

0

0

d

d

d

Utilities

107

7,011

d

d

d

d

11

4

300

88

11,602

0

18

0

11

d

84

d

207

0

56

Bond and tax/revenue

anticipation notes

Other purposes [3]

Size of entire issue—continued

Bond purpose

5,000,000

under

$10,000,000—

continued

$25,000,000

under

$75,000,000

$10,000,000

under

$25,000,000

$75,000,000

or more

Amount

Number

Amount

Number

Amount

Number

Amount

(8)

(9)

(10)

(11)

(12)

(13)

(14)

Total [1, 2]

1,003

176

2,823

197

8,495

166

52,468

Education

325

75

1,223

93

3,495

52

14,419

Health and hospital

d

3

48

6

145

11

2,263

Transportation

91

12

150

23

761

46

17,210

Public safety

82

11

100

10

86

10

1,552

Environment

63

17

247

28

890

14

2,899

Housing

d

d

d

d

d

4

237

Utilities

56

16

228

22

944

30

5,736

Bond and tax/revenue

anticipation notes

Other purposes [3]

0

d

d

d

d

0

0

347

54

785

56

2,102

32

8,151

d—Data deleted to avoid disclosure of information about specific bonds. However, the data are included in the appropriate totals.

[1] Bonds reported on the Form 8038-G, Information Return for Tax-Exempt Governmental Obligations, with a specific reference to "Build America Bond" or "Recovery Zone Economic

Development Bond" in either their issue name or other description.

[2] A given bond issue can include more than one purpose. Thus, the summation of number of issues by purpose will sometimes exceed the total number of issues. However, the

money amounts add to the totals.

[3] "Other purposes" refers to obligations for which a specific purpose either did not apply or was not clearly indicated on the Form 8038-G, Information Return for Tax-Exempt

Governmental Obligations.

NOTE: Detail may not add to totals because of rounding.

190