Dayton leader testifies on Capitol Hill in support of community funding

DAYTON, Ohio (WDTN) — A city of Dayton official addressed members of Congress in hopes of gaining funding to assist communities across the country.

LaShea Lofton, deputy city manager for Dayton, testified in Washington D.C., urged Congressional leaders to support providing funding support for local communities during the U.S. Senate Committee on Finance’s ‘Tax Tools for Local Economic Development’ hearing.

“Providing infrastructure in our communities is a national priority; one shared at all levels of government,” said Lofton.

During Lofton’s initial testimony, she called for support in the upcoming legislation of tax and public finance of the following:

Restore advanced funding: tax-exempt bonds

If approved, Lofton argues it will allow billions of dollars for governments and non-profit organizations to spend on infrastructure.

According to Lofton, the city of Dayton issued over $11 million in debt to finance capital improvements in 2018. On the bonds, the city could save at least $300,000 in savings if tax-exempt advance refunding were available.

Lofton cites potentially renovating a city park or upgrading streets and sidewalks that lead to libraries with the funding.

Increase capital access for small borrowers

An increase in capital access would benefit many thousands of small issuers, government and non-profit barrowers, according to Lofton.

By increasing the bank borrowing limit from $10 million to $30 million at the borrower level would provide access to low-cost capital.

At the current interest rate of a 15-year, $10 million bond, small communities could save between $232,000 to $$370,000.

Expand and restore direct pay bonds

During Lofton’s testimony, she urged lawmakers to expand and restore direct pay bonds with specific attentions to protect the subsidies from sequestrations.

Although taxable-direct subsidy bonds have been issued in the past by the U.S. government, Lofton said sequestration “ate into those bonds for Build America bonds.” Since that has occurred, Lofton would like to see a “definitive protection from sequestration,” if restored.

Capital stacks and gaps in Dayton

Lofton said in projects, there are gaps that occur with developments. Capital stacks for potential redevelopment projects are “incredibly complicated” with various tax credits.

Lofton cited a few examples that could benefit from credits and incentives:

• Brownfield sites
• Abandoned buildings
• ex-Montgomery County Fairgrounds site

“I do think it is very critical and important that municipalities can participate in some of these developments,” said Lofton. “Otherwise, there are gaps there that the private sector can’t fill and we play an important partnership there.”

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