Opponents say any such changes could drive up localities’ borrowing costs by 1 percent to 2 percent because issuers will need to pay more interest to compete with other taxable investments.
Rattner’s group says it also could cut off a potential source of low-interest financing for communities affected by last month’s superstorm.
Although the Federal Emergency Management Agency will cover some recovery costs, which could reach as much as $50 billion, the development council will press for expanded authority so states and localities can issue bonds for private activities.
If Congress doesn’t act, utilities such as Consolidated Edison could raise customer rates and agencies such as the New York Metropolitan Transportation Authority may issue their own bonds to help cover system repair bills.
Vice President Joe Biden waits to conduct a mock swearing-in ceremony with Sen. Brian Schatz, D-Hawaii, in the Capitol's Old Senate Chamber, December 2, 2014. Schatz was sworn in to serve the remainder of his term since he was appointed to the seat after Sen. Daniel Inouye, D-Hawaii, passed away.