Private Activity Bonds
Overview
- PA-1 Private Activity State Ceiling Application
- PA -2 Final Certification of Private Activity Bond Issuance
Private activity bonds under the Internal Revenue Code (the Code) are described generally as any bond: (1) of which more than 10% of the proceeds is to be used in a trade or business of any person or persons other than a governmental unit or which is to be directly or indirectly repaid, or secured by revenues from a private trade or business; and (2) in which an amount exceeding the lesser of 5% or $5 million of the proceeds is to be used for loans to any person or persons other than a governmental unit.
Most private activity bonds must be sold on a taxable basis. However, the Code grants exceptions and specifies when certain bonds can be sold on a tax-exempt basis (Qualified Private Activity Bonds). The Federal Tax Reform Act of 1986 established limits on the volume of private activity bonds that may be issued in a state during any calendar year. To ensure compliance with federal law, the Oklahoma legislature passed the Oklahoma Private Activity Bond Allocation Act (the Act).
Yearly PA Bond Apportionments
Oklahoma Private Activity Bond Allocation Act
The Act, which is administered by the Deputy Treasurer for Debt Management, ensures that the state complies with the provisions of federal law limiting the use of these bonds and provides for the systematic distribution of the state’s volume cap. Pursuant to Revenue Procedure 2024-40 published by the Internal Revenue Service, the volume cap limit on Qualified Private Activity Bonds for calendar year 2025 is the greater of $130 per capita (calculated from the state’s resident population) or $388.8 million. For calendar year 2025, Oklahoma’s volume cap is $532.4 million.
Pursuant to the Act, allocations can only be made from specified volume cap pools from January 1st through September 1st of each calendar year. The pool allocations delineated pursuant to the Act are shown in the table below.
On September 2nd of each calendar year, the unallocated volume cap from all pools is combined to form the Consolidated Pool. Allocations from this pool can be made for any type of private activity bond pursuant to a priority system provided for in the Act. The Consolidated Pool terminates on December 20th of each calendar year and remaining volume cap is transferred to the Carryforward Pool. Allocations from any the Carryforward Pool can be made through the next to last business day of the year. Those issuers receiving carryforward allocations have three years in which to use the allocation.
Yearly PA Bond Apportionments
2025 State Volume Ceiling: $532,401,090
| Statutory Allocation Pools | % of Total | Pool Total |
| Local Issuer - Single Family | 17.5% | $93,170,191 |
| Oklahoma Student Loan Authority | 15.5% | $82,522,169 |
| Oklahoma Housing Finance Agency | 15.0% | $79,860,164 |
| Metropolitan Area Housing | 12.5% | $66,550,136 |
| Economic Development | 12.0% | $63,888,131 |
| Qualified Small Issue | 12.0% | $63,888,131 |
| Rural Area Housing | 8.0% | $42,592,087 |
| State Issuer | 4.0% | $21,296,044 |
| Exempt Facility | 2.5% | $13,310,027 |
| Beginning Agricultural Producer | 1.0% | $5,067,280 |
| Total | 100.0% | $532,401,090 |
