They are supposed to help states and cities that are short of cash build roads, schools and bridges.

But Build America Bonds, part of President Obama’s economic stimulus plan, are also building something else: controversy. The federal government pays 35 percent of the interest costs on the bonds, a huge potential saving.

States and cities have embraced these taxable bonds to borrow money at what they assume are favorable interest rates. But questions about this multibillion-dollar program

Read more...