Bill > S2007

This bill amends the Internal Revenue Code to modify tax rules related to bonds used for lead service line replacement projects. Specifically, the bill clarifies that when municipal bonds are used to replace privately-owned lead service lines connecting to a public water system, this use will not be considered "private business use" that could otherwise jeopardize the tax-exempt status of the bonds. The bill provides precise definitions for key terms like "lead service line" (drawing from the Safe Drinking Water Act), "public water system", and "national primary drinking water regulation for lead". The goal is to make it easier and more financially attractive for municipalities to replace lead service lines, which can pose significant health risks, by ensuring that such bond-funded projects do not create tax complications. The changes will apply to bond obligations issued after December 31, 2025, giving local governments and water utilities a clear timeline for implementing these more flexible financing approaches for critical infrastructure improvements.

Budget and Finance

https://www.congress.gov/bill/119th-congress/senate-bill/2007/all-info