By Larry Jones
January 31, 2011

Racine Mayor John Dickert, Vice Chair of The U.S. Conference of Mayors Metro Economies Committee, introduced United States Treasurer Rosie Rios as "one of us," during the Conference of Mayors closing luncheon session on January 21. He explained that she truly understands local governments, having worked for several cities as director of economic development prior to joining the Obama Administration.

Rios began her remarks citing the success of the Build America Bonds program and other federal initiatives that are creating jobs in local communities across the nation.

Rios stated that the Build America Bonds program was one of the largest and most successful bond programs approved under the American Recovery and Reinvestment Act. By the end of 2010, she said there were 2,275 issuances of Build America Bonds by state and local governments. A total of $181.2 billion of the securities have been sold since April 2009 to fund a variety of critical infrastructure projects including schools, hospitals, roads, bridges clean water and sewage systems and transit systems. Under this popular program, the U.S. Treasury Department pays a direct subsidy to local governments that issue these bonds equal to 35 percent of the interest costs.

Rios reminded mayors that the program ended December 31, 2010. However, President Obama included language in his 2011 Budget to make the Build America Bond program permanent. Although the House passed two separate bills to extend the program, the measure stalled in the Senate. Mayors firmly support the extension of the program and will continue to urge their congressional delegations to support legislation extending the program.

Rios told mayors that the New Market Tax Credits program, which provides tax incentives to encourage businesses to locate in distressed neighborhoods has been "…a critical force for economic recovery, helping create, save or support hundreds of thousands of local jobs in construction and associated retail and service positions."

She also explained that the 2010 allocation of $3.5 billion will be made available next month and cities will be able to form their own Community Development Entities to apply for the program.

A number of cities have already received allocations in the last two rounds including Dallas, Chicago, Seattle, Kansas City, Washington (DC), Memphis and Phoenix. "I encourage all of you to discuss the program with these cities that have successfully applied and deployed investments." She added, "Another $3.5 billion for the 2011 round is available and the application will be released in May — so keep an eye out for that."

Rios told mayors about the Treasury Department's State Small Business Credit Initiative. She said the program was part of the Small Business Jobs Act signed into law last September. Under the program, $1.5 billion is allocated to the 50 states and territories based on formula with a commitment by states to demonstrate $10 in new private lending for every $1 in federal funding. The goal is to create $15 billion in additional private lending.

All states, the District of Columbia and the territories are able to apply and if a state does not apply, the municipalities will have the opportunity to apply.