Commercial Infrastructure Bonds

Definition

"Commercial infrastructure bonds" is a market description, not a statutory term, for debt that finances infrastructure such as airports, ports, water, sewer or energy facilities used or operated by private businesses. When a state or local government issues such bonds, federal tax law treats them as private activity bonds whose interest is tax-exempt only if they fit a qualified category, such as exempt facility bonds.^[1]

Federal law

A market and contract term. No Act of Congress defines it; the federal laws below apply as described.

1. Tax Reform Act of 1986, Pub. L. 99-514, § 1301, 100 Stat. 2602. Enacted 26 U.S.C. § 141 (private activity bond tests) and § 142 (exempt facility bonds); governs the tax status of governmental bonds that finance privately used infrastructure, not the market term itself. Official text: govinfo.gov, U.S. Government Publishing Office.