MINT Act
- Bill Number
- H.R. 7769
- Origin Chamber
- House
- Congress
- 119th Congress, Session 2
- Policy Area
- Taxation
- Status
- Introduced
- Latest Action
- 2026-03-03: Referred to the House Committee on Ways and Means.
- Last Updated
- 2026-06-09T08:06:45Z
AI-Generated Summary
Purpose
The Municipal Investment and Neighborhood Transformation Act (MINT Act), H.R. 7769, aims to make it easier for state and local governments to issue tax-exempt bonds by allowing guarantees from Federal Home Loan Banks (FHLBs) without those guarantees being treated as federal backing, which could otherwise jeopardize the bonds' tax-free interest status for investors. This restores and extends a previous temporary provision to support municipal financing for community projects.
Key Provisions
- Amendment to Tax-Exempt Bond Rules: Modifies Section 149(b)(3)(A)(iv) of the Internal Revenue Code of 1986 by removing a time limit that restricted FHLB guarantees (in the form of letters of credit) to bonds issued only between the original law's enactment and December 31, 2010. This allows such guarantees on tax-exempt state and local bonds issued after the bill's enactment without affecting their tax-exempt status.
- Updated Safety Standards: Revises Section 149(b)(3)(E) to require that FHLB guarantees meet safety and soundness standards set by the Director of the Federal Housing Finance Agency (FHFA), an independent regulator overseeing housing finance entities, rather than outdated specific thresholds.
- Effective Date: Applies to guarantees made after the date the bill is enacted into law.
Significant Changes to Existing Law
- Removal of Expiration Date: Prior to this bill, FHLB guarantees were only exempt from being classified as "federally guaranteed" (which would make bond interest taxable) for a limited period ending in 2010. The bill eliminates this cutoff, making the exemption permanent for future guarantees.
- Modernization of Requirements: Replaces rigid, outdated safety criteria (e.g., specific capital ratios) with flexible standards determined by the FHFA Director, allowing for ongoing adjustments based on current financial conditions.
Potential Impacts
- On Government Agencies: FHLBs (part of the federal housing finance system) may see increased demand for their guarantee services, potentially expanding their role in supporting local infrastructure without additional federal funding. The FHFA gains authority to set evolving safety rules, promoting financial stability.
- On Citizens: Could lower borrowing costs for state and local governments by enabling more affordable tax-exempt financing for projects like schools, roads, and housing, indirectly benefiting communities through improved public services and neighborhood development. Investors in municipal bonds may gain more secure, tax-advantaged options.
- On International Relations: No direct impacts, as the bill focuses on domestic tax and financing policies.
Main Stakeholders Affected
- State and Local Governments: Primary beneficiaries, as they can more easily access low-cost financing for public projects.
- Federal Home Loan Banks: Likely to provide more guarantees, enhancing their utility in the municipal bond market.
- Bond Investors: Individuals and institutions holding tax-exempt municipal bonds, who benefit from preserved tax advantages and potentially lower risk.
- Taxpayers: Federal government may see indirect effects through sustained tax-exempt status, which reduces taxable income but supports local economic growth without new tax burdens.
- Federal Housing Finance Agency: Assumes responsibility for defining safety standards, influencing oversight of FHLB activities.
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens the tax code's framework for private activity bonds (a type of municipal bond used for specific public purposes) by clarifying that FHLB involvement does not trigger federal guarantee rules, potentially reducing litigation over bond validity. No challenges to tax-exempt status under arbitrage or private use restrictions are introduced.
- Constitutional: Aligns with Congress's broad authority under Article I to regulate taxation and commerce; no apparent conflicts with federalism principles, as it empowers state/local entities while involving federal oversight.
- Political: Supports bipartisan goals of infrastructure investment and housing affordability (evidenced by cosponsors from both parties), but could spark debate on federal involvement in local finance and the scope of tax exemptions, influencing future fiscal policy discussions.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Rep. McClain, Lisa C. [R-MI-9]
Cosponsors (9)
Rep. Liccardo, Sam T. [D-CA-16], Rep. Tenney, Claudia [R-NY-24], Rep. Horsford, Steven [D-NV-4], Rep. LaHood, Darin [R-IL-16], Rep. Perez, Marie Gluesenkamp [D-WA-3], Rep. Salazar, Maria Elvira [R-FL-27], Rep. Beatty, Joyce [D-OH-3], Rep. Williams, Nikema [D-GA-5], Rep. Stutzman, Marlin A. [R-IN-3]
Recent Actions
- 2026-03-03: Referred to the House Committee on Ways and Means.
- 2026-03-03: Introduced in House
- 2026-03-03: Introduced in House
Bill Versions
- Municipal Investment and Neighborhood Transformation Act — issued 2026-03-03 — PDF (2 pages)