Washington, D.C. – Congressman Darin LaHood (IL-16), a member of the Ways and Means Committee, today announced new bipartisan legislation to help small and medium manufacturers and farmers generate good-paying jobs in Illinois and throughout the country. Congressman LaHood was joined by Reps. Dan Kildee (D-MI), Randy Feenstra (R-IA), and Dwight Evans (D-PA) to introduce the legislation.
The Modernizing Manufacturing and Agricultural Bonds Act updates the federal rules for manufacturing and agricultural bonds. These bonds are exempt from federal tax and are important tools used by state and local agencies to support small manufacturers and farmers and spur economic development. Over the last decade, use of these types of bonds has declined due to their outdated rules and regulations.
“When farmers and manufacturers succeed, our communities thrive in central and northwestern Illinois,” said Congressman LaHood. “The Modernizing Agricultural and Manufacturing Bonds Act will provide entrepreneurs and first-time farmers with the financing tools they need to grow, creating good-paying jobs, and bolstering our economy. I am proud to join this bipartisan effort and I will continue to work in Congress to ensure farmers and manufacturers have the necessary tools to be successful in our 21st-century economy.”
“Manufacturing and agricultural bonds can be powerful economic development tools to support farmers and small manufacturing businesses, but the bond programs need to better work for small businesses and farmers,” said Congressman Kildee. “Modernizing these bonds and cutting government red tape will grow our local economy and create more good-paying jobs in mid-Michigan. I’m proud to introduce this bill with Republican and Democratic support.”
“Industrial Development Bonds (IDBs) and First-Time Farmer Bonds (Aggie Bonds) are vital to economic development, manufacturing, and our farm economy in rural Iowa. However, outdated rules and regulations have hindered our domestic manufacturers and family farmers from utilizing these bonds,” said Congressman Feenstra. “I’m proud to work with my colleagues Rep. Darin LaHood, Rep. Dan Kildee, and Rep. Dwight Evans to modernize current law to reflect the intensive capital needs of Iowa farmers and manufacturers to be profitable and productive. I will continue to support policies that grow our manufacturing capabilities, generate robust economic activity, and help our beginning farmers thrive.”
“In the Philadelphia region alone, there are more than 60 certified manufacturing businesses that could benefit from expanded eligibility to retain or create jobs,” said Congressman Evans. “And the farming sector is vital to Pennsylvania and the nation, both because of its sizable role in the economy and because we all need food!”
“We're thrilled that MAMBA has been reintroduced with such broad-based support. In the wake of the COVID-19 pandemic and amid increased global economic competition, it has become clear that investments in farmers and manufacturers are necessary to shore up the United States’ supply chains. By updating the 40-year-old rules around agricultural and manufacturing bonds, MAMBA allows for the innovative financing tools necessary to invest in local communities and provide a bulwark against future food and supply chain disruptions,” said Council of Development Finance Agencies President and CEO Toby Rittner. “Representatives Kildee, LaHood, Feenstra, and Evans have been great champions of private activity bonds and the development finance industry as a whole, and I'm thankful for their commitment to manufacturing and farming—key pillars of the U.S. economy.”
The Modernizing Agricultural and Manufacturing Bonds Act would:
- Raise the maximum manufacturing bond size from $10 million to $30 million, updating this threshold for inflation and economic changes. Additionally, the bill ties future bond size increases to inflation.
- Modernize the definition of a “manufacturing facility” to include high-tech manufacturing processes, including bio-technology, design and formula development.
- Eliminate restrictions that prevented bond proceeds from being used towards offices space, locker rooms, and cafeterias at small manufacturing facilities.
- Increase the amount of bond proceeds that can go to first-time farmers from $450,000 to $1 million and allow new farmers to use bond proceeds to upgrade existing agricultural buildings and property and purchase farm equipment.
- Align the definition of “substantial farmland” in the federal tax code with existing law.
