Some muni market advocates have growing concerns that COVID-19 is limiting their ability to push important muni bond initiatives on Capitol Hill and elsewhere. Congress is still open with staffers and lawmakers present, but those offices could decide to minimize or ban face-to-face meetings as virus concerns grow.

The municipal market was hammered Wednesday by the rapidly spreading COVID-19 global pandemic with a more than quarter point correction in AAA benchmarks, issuers pulling deals off the shelves and more reports of pricing and evaluation confusion in an already complicated market.

The chairman of the House Transportation and Infrastructure Committee favors the creation of a series of Treasury bonds dedicated to transportation that would be paid for by indexing the federal gasoline tax. The last estimate was the added revenues from inflationary rises in the gas tax could allow $500 billion of bonds to be sold over 13 years.

Public transit advocates told a Senate committee that a significant increase in federal funding for new buses and rail cars along with flexibility for reaching rural populations should be included in the next transportation reauthorization bill. The U.S. Chamber of Commerce favors paying for those investments with an increase in gas and diesel taxes along with increased use of federal loan programs, private activity bonds, and public-private partnerships.