Until just recently, many manufacturing projects that otherwise would have been eligible for financing with tax-exempt bonds have been prevented from using such financing because of the $10 million “capital expenditure” limit.
The newly-enacted “Tax Increase Prevention and Reconciliation Act of 2005,” signed into law on May 17, 2006, increases the limit on capital expenditures from $10 million to $20 million with respect to bonds issued after December 31, 2006. The act does not increase the maximum face amount of the tax-exempt bonds themselves, which is still limited to $10 million.
