The Build America Bond program is likely to be extended for one year at something less than its current 35% federal interest cost subsidy level, due to the dynamics shaping up around the tax-cut extension Congress will consider when it returns after Thanksgiving.

Several sources said if an agreement can be reached on the larger question of the extension of the current, Bush era tax rates, then a tax bill will pass in the lame duck session and it is very likely to include extension of BABs and other municipal bond provisions from the American Recovery and Reinvestment Act that are otherwise set to expire.

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