Oregon Legislature Passes Bill Expanding OFA Housing Activities, AND Sets Stage for BIG Expansion in Use of Build America Bonds.

Following earlier House passage, the Oregon Senate passed HR 3646A on Saturday Feb 20th., moving the bill to the Governor for signature. (The Senate Staff Measure Summary is HERE; it projects a .5% to .8% reduction in interest rate for Build America bonds).

The bill authorizes the Oregon Treasurer to receive tax credits and rebates from the Federal Treasury and expands eligible housing related activities of the Oregon Facilities Authority.

One likely outcome of the bill that seems likely is a LARGE expansion of the use in Oregon of Build America bonds.

My recent post on state use of municipal bonds for 2009 included a Bond Buyer table that showed that Oregon had issued only $21.5 million in Build America bonds in 2009 vs $1.844 BILLION in Washington State.

My Projections of Oregon Debt Payment Savings from $1 Billion in Build America Bonds:$65-$104 Million Over 20 Years.
The Senate Staff Measure Summary projects a .5% to .8% reduction in interest rates by using Build America bonds; at a volume of $1 Billion, a 20 year term, and a NON BA bond rate of 5%, the BA bonds would save /reduce borrowing costs by $65-$104 million over a 20 year period or $3.3 million to $5.2 million annually.

Originally created and posted on the Oregon Housing Blog.