RI Public Finance Management Board Authorizes the Issuance of Tax-Exempt Private-Activity Bonds to Aide Housing and Student Loan Programs

Published on Friday, December 06, 2024

Providence, RI – The RI Public Finance Management Board (PFMB), chaired by General Treasurer James A. Diossa, approved volume cap allocations in the amounts of $298.23M to Rhode Island Housing (RIHousing) and $80M to Rhode Island Student Loan Authority (RISLA) on Thursday.

RIHousing’s allocation will provide Rhode Islanders with more affordable homeownership opportunities while supporting the housing and construction industries within the state. RISLA will use their funds to offer much lower interest rates to students and their families on new or refinanced education loans than what is available from for-profit companies or through the Federal Parent PLUS program.

For calendar year 2024, Rhode Island’s private activity bond cap amount set by the IRS is $378,230,000. The interest that bondholders receive is not subject to federal or State of Rhode Island income taxes and enables the authorities to sell debt at a lower interest rate than taxable debt. Under certain circumstances, volume cap that is not used by the end of the year may be carried forward for use in one of the next three years.

“Volume Cap allocations are another tool in the toolbox that allows the state to help agencies tackle community needs,” said General Treasurer Diossa, Chair of the PFMB. “I thank the members of the board for unanimously approving both RIHousing’s and RISLA’s requests, especially with such a strong need in the areas of housing and college debt.”