One county in the mid-Hudson Valley will benefit from the $150 million in ARRA bonds for integrated housing and community development. Out of five targeted by the New York State Homes and Community Renewal, Putnam was included in the bond issuance to reduce its borrowing costs.
It will consist primarily of Build America Bonds (BABs) and Recovery Zone Economic Development Bonds (RZEDBs), created by Congress in the American Recovery and Reinvestment Act in 2009.
Under the program, the State of New York Municipal Bond Bank Agency (MBBA), established in 1972 to provide municipalities with access to capital markets for special programs, will sell a mix of tax-exempt bonds and taxable BAB and RZEDBs on behalf of local governments. Sale of the bonds helps local governments save money on their borrowing costs. BABs and RZEDBs receive federal government subsidies for the life of the bonds. The subsidies consist of 35 percent of the interest payments for BABs and 45 percent for RZEDBs.
“Our Recovery Act Bond program helps local governments reduce their borrowing costs, ensuring that their capital dollars will go further,” said Brian E. Lawlor, CEO of New York State Homes and Community Renewal. “These bond issues will finance a wide range of needed capital projects, from bridge and hospital improvements to upgrading emergency radio communication systems. Our partnership with localities is an example of how our newly integrated agency is making state government more efficient and productive.”
The board”™s action will mark the third issuance of Recovery Act Bonds since the program began last year. MBBA sold $184.6 million in Recovery Act Bonds in November 2009 and $116.3 million in May 2010.
