Bill > S2203

This bill, titled the Bolstering Our Nations Deficient Structures Act of 2014 or the BONDS Act, permanently extends the favorable tax treatment for certain Build America Bonds (BABs), which are a type of municipal bond designed to finance infrastructure projects. Specifically, it amends the Internal Revenue Code of 1986 to allow BABs issued from January 1, 2011, onwards to continue receiving their tax benefits, which include a federal government subsidy to bondholders to offset interest payments. The bill also adjusts the subsidy percentage for BABs issued in different years, with a gradual reduction from 31% in 2014 down to 28% for bonds issued in 2017 and beyond. Furthermore, it clarifies that BABs can be considered "recovery zone economic development bonds" for certain purposes, allows for the refunding of existing BABs under specific conditions, and includes provisions for public transportation projects and flood control infrastructure. The bill also addresses potential reductions in payments to issuers due to sequestration, a process of automatic government spending cuts, by increasing the payment amount to compensate for such reductions.