WASHINGTON - A new General Accounting Office report says small-issue industrial development bonds are not notably effective in creating jobs, and suggests that Congress may want to scrap proposals for renewing the exemption for the bonds, which expired last June 30.

Municipal lobbyists, however, disputed the GAO's conclusions, saying the findings were not borne out by the data gathered by the agency. The lobbyists also noted that the GAO found that IDB issues are meeting federal requirements and are not displaying a high default rate.

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