Bailey Quoted on Industrial Development Revenue Bond Issues

Partner Michael G. Bailey was quoted in an article that appeared in The Bond Buyer on August 20, 2012 titled “IRS Says $9.95M of IDBs May Be Taxable.” Bailey provided comment on a provision in the Internal Revenue Code that sets a tax law limit of $20 million on capital expenditures made in the county for tax-exempt small-issue IDBs. He indicated that it is difficult for borrowers to monitor compliance because it includes capital expenditures outside of the project. Bailey also stated that the IRS has been aware of this issue since 1993 and that provision was cited as one of the three most likely areas of noncompliance for muni issuers and borrowers.