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119-s-2100119th CongressWALLET

Modernizing Agricultural and Manufacturing Bonds Act

Sponsored By: Senator Ernst, Joni [R-IA]

In Committee

Summary

Expand access to tax-exempt bonds for manufacturing projects and first-time farmers. This bill would broaden what counts as a manufacturing facility for qualified small-issue bonds, raise dollar caps that limit those bonds, and add inflation adjustments to key limits.

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Bill Overview

Analyzed Economic Effects

3 provisions identified: 3 benefits, 0 costs, 0 mixed.

More tax-exempt help for new farmers

If enacted, this bill would raise several dollar limits for first-time farmer private-activity bonds. The per-bond and related QSI limits would rise to $1,000,000 (replacing $450,000 and $250,000 limits). The separate lower limit on used farm equipment would be repealed. These changes would apply to bonds issued after December 31, 2025. Inflation adjustments would begin after 2026 using a new reference year for future increases.

Broader tax-exempt bonds for manufacturers

If enacted, this bill would broaden what counts as a manufacturing facility for certain tax-exempt small-issue bonds. It would include places that make or process tangible goods and some places that create certain intangible property. Directly related on-site ancillary facilities could qualify if no more than 25% of the issue's net proceeds pay for them. Office space would be limited similar to current rules. The expansion would not apply to bonds issued on or before the date of enactment and would apply only to obligations issued after enactment.

Higher caps for small-issue bonds

If enacted, this bill would raise numeric caps for qualified small-issue private activity bonds. The per-issue cap would increase to $30,000,000 and the per-taxpayer aggregate cap would increase to $120,000,000. It also sets a $30,000,000 threshold for certain additional capital expenditures for bonds issued after enactment. For calendar years after 2025 these amounts would be increased for inflation using 2024 as the reference year and rounded to the nearest $100,000. These rules would apply to obligations issued after enactment.

Sponsors & CoSponsors

Sponsor

Ernst, Joni [R-IA]

IA • R

Cosponsors

  • Sen. Warner, Mark R. [D-VA]

    VA • D

    Sponsored 6/17/2025

  • Sen. Hyde-Smith, Cindy [R-MS]

    MS • R

    Sponsored 6/17/2025

Roll Call Votes

No roll call votes available for this bill.

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