The Republican-led Senate today brought an education package to the floor for debate. The plan enhances capital resources for school construction by increasing school bond opportunities, expands education savings accounts, extends employer-provided tuition breaks and makes student loan interest tax deductible for the life of the loan.
"When it comes to improving America's schools, Washington needs to stop electioneer-ing and start putting tax dollars to good use," said Grassley. "We can start by unleashing more money for local school construction."
"The Affordable Education Act of 1999" includes Grassley's amendment to expand the deductibility of student loan interest payments and two school construction measures advanced by the senior Iowa senator last year during consideration in the Senate Finance Committee.
Arbitrage Rebate Exemption ? The bill would allow school districts to bypass complex arbitrage rebate rules and issue up to $15 million in tax-exempt bonds for school construction, up from the current $10 million limit.
Private Activity Bonds ? The bill would allow school districts to partner with private investors and leverage private dollars to improve local public schools with the issuance of tax-exempt bonds worth $992 million over 10 years. For the first time since 1986, it would open the door for commercial banks to participate.
"These initiatives would expand access to affordable capital and relieve pressure on the local tax base," said Grassley. "I visit at least 20 schools in Iowa every year and I come across a variety of maintenance challenges and infrastructure improvements needed in the classroom. I want to give local school districts the opportunity to modernize their facilities, repair aging buildings and give our school houses a high-tech face lift."