Overview
Title
To amend the Internal Revenue Code of 1986 to deny the tax exempt status for bonds issued by sanctuary jurisdictions.
ELI5 AI
H.R. 1879 is about stopping certain cities or places from getting tax breaks when they sell a kind of "promise to pay back money," called a bond, because those cities don't always follow certain immigration rules. It's a way to try and make sure these places share information about people who might not be allowed to stay in the country.
Summary AI
H.R. 1879, titled the "No Tax Breaks for Sanctuary Cities Act," proposes changes to the Internal Revenue Code of 1986 to remove tax-exempt status for bonds that are issued by sanctuary jurisdictions. A "sanctuary jurisdiction" is defined as a state or political subdivision that prevents government entities or officials from sharing information regarding an individual's immigration status or complying with certain requests from the Department of Homeland Security. The bill requires the Secretary of the Treasury, in consultation with the Secretary of Homeland Security, to publish a list of sanctuary jurisdictions annually. The changes would impact taxable years ending after the bill's enactment and apply to obligations issued thereafter.
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AnalysisAI
The proposed legislation, known as the "No Tax Breaks for Sanctuary Cities Act," aims to amend the Internal Revenue Code of 1986. It introduces a rule that would deny tax-exempt status to bonds issued by jurisdictions considered as sanctuary areas. Sanctuary jurisdictions are defined as regions that have laws or practices restricting the sharing of information regarding an individual's citizenship status or that refuse to comply with specific federal immigration requests. To enforce this, the Secretary of the Treasury, in consultation with the Department of Homeland Security, is required to annually publish a list of these jurisdictions.
Significant Issues
A number of notable concerns arise from this bill. First, there is ambiguity in defining what constitutes a "sanctuary jurisdiction." The reliance on various local statutes, ordinances, policies, or practices that differ between jurisdictions could lead to inconsistent application and potentially invite legal challenges.
Second, the requirement to publish a list of sanctuary jurisdictions annually may not account for jurisdictions that modify their policies more frequently. This could lead to confusion or inconsistencies in the application of the law and unpredictability in bond status for these regions.
Third, the bill raises possible federalism issues by imposing federal restrictions on state and local governments' decisions, which might be seen as an infringement on states' rights to self-governance, particularly concerning their local law enforcement and information-sharing practices.
Moreover, there is a lack of explicit definition of what constitutes a "bond issued by a sanctuary jurisdiction," which might lead to different interpretations and enforcement challenges across states and localities.
Finally, the process of designating "sanctuary jurisdictions" could potentially be influenced by political biases, leading to concerns over favoritism or discrimination against some jurisdictions based on their political or policy stances.
Potential Impacts
The bill's impact on the public broadly involves the financial consequences that many jurisdictions could face if they are labeled as sanctuary areas. Losing tax-exempt status on bonds can increase borrowing costs for these jurisdictions, potentially leading to higher taxes or reduced funding for public projects such as infrastructure, schools, and community services.
Stakeholders, such as officials and residents of potentially affected jurisdictions, might experience negative impacts due to increased financial pressure and decreased ability to fund local initiatives. Conversely, proponents of stricter immigration enforcement might view the bill positively, seeing it as a mechanism to pressure jurisdictions to align more closely with federal immigration laws.
Finally, the bill could further polarize communities and governmental entities based on positions regarding immigration policies, potentially exacerbating divisions within and between states and the federal government. This tension might also extend to financial markets and bond investors, as uncertainty about a jurisdiction's bond status can affect market confidence and investment decisions.
Issues
The definition of 'sanctuary jurisdiction' in Section 2(b) might be considered ambiguous or overly broad. Since it relies on statutes, ordinances, policies, or practices that might be interpreted differently by different jurisdictions, there is a risk of inconsistent application and potential legal challenges.
The bill's requirement in Section 2(c) that the Secretary of the Treasury publish an annual list of sanctuary jurisdictions could lead to inconsistency or confusion. This is particularly problematic if jurisdictions change their policies more frequently than annually, as it could affect their bond status unpredictably.
There are potential federalism concerns in Section 2, as the bill imposes restrictions on state and local government decisions regarding information sharing with federal authorities, which could be seen as infringing on states' rights to govern themselves.
Section 2 does not explicitly define what constitutes a 'bond issued by a sanctuary jurisdiction.' This could lead to varying interpretations and enforcement challenges across different jurisdictions.
The designation of 'sanctuary jurisdictions' could potentially be subject to political bias, leading to perceived favoritism or discrimination against certain jurisdictions. This concern is exacerbated by the reliance on federal executive agencies, which might be influenced by political motivations.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The section provides the name of the act as the “No Tax Breaks for Sanctuary Cities Act.”
2. Denial of tax exempt status for bonds issued by sanctuary jurisdictions Read Opens in new tab
Summary AI
The text explains that a new rule is being added to the tax code which prevents tax-exempt status for bonds issued by areas known as sanctuary jurisdictions. A sanctuary jurisdiction is defined as a place that limits sharing information about a person's citizenship with governmental authorities or doesn't comply with certain federal immigration requests. The Treasury Secretary, in consultation with the Department of Homeland Security, must publish a list of these jurisdictions every year. This rule applies to bonds issued after the law is enacted.