Senate tax reform legislation that will go before the Senate Finance Committee on November 13 preserves the Private Activity Bond (PAB) program and renewable tax credits, deviating from the House version of the bill. The "chairman's mark" of the bill, known as the Tax Cuts and Jobs Act, preserves the tax deductibility of interest earned from Private Activity Bonds. A "chairman's mark" of the legislation is the first draft of legislation that is introduced by the committee chairman, Sen. Orrin Hatch (R-Utah).

On November 2, tax reform legislation introduced in the House of Representatives proposed eliminating PABs. The House Ways and Means Committee noted in its bill summary that the federal government should not subsidize the borrowing costs of private businesses by allowing them to pay lower interest rates than competitors pay on the debt they issue.

The committee approved the bill, also called the Tax Cuts and Jobs Act, on 9 November. The House may vote on the bill as early as the week of November 13.

The "elimination of PABs would be a huge blow to infrastructure P3 projects, so the Senate bill preserving PABs is welcome news," said Steve Park, partner at Ballard Spahr. He said more clarity will emerge on the fate of PABs as the bills move through the legislative process.

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