WASHINGTON - Indian tribes would be able to issue tax-exempt bonds for building roads, bridges or other infrastructure under a bill pushed by Sen. Max Baucus, D-Mont.

Baucus listed the measure as one of his top priorities for Indian Country when speaking Monday to an annual legislative summit of the National Congress of American Indians.

"Indian country must be able to issue tax-exempt bonds in the same way that non-Indian entities do today," he said to loud applause.

He and Sen. Gordon Smith, R-Ore., introduced the bill in July. It is now before the Senate Finance Committee, which Baucus chairs.

The Tribal Government Tax-Exempt Bond Parity Act would allow a tribal government to be treated like a state government for the purpose of issuing bonds for projects on its reservation. Baucus said it would go a long way toward improving infrastructure in Indian Country with the added benefit of creating jobs.

W. Ron Allen, secretary of the National Congress of American Indians, spoke in favor of the bill and asked a White House official at the meeting to support it.

"To get the Treasury and the IRS to respect our government like any other government would be a major, positive move forward," Allen said.

Baucus said he would push for two other tax measures in his committee that would benefit Indian Country: an employment credit and an accelerated depreciation measure.

"That sounds kind of boring on the surface, but it means jobs, it means economic development," he said.

Congress currently extends those tax benefits on a year-to-year basis, so companies don't know if they will be continued and don't take full advantage of them, Baucus said.

Baucus also said he will advocate for measures boosting the tribal college and university system and funding Johnson O'Malley education grants. President Bush's 2009 budget proposes to eliminate the grant program.

Congress also needs to strengthen tribal courts and police and have more detention centers, Baucus said.

He added that the health care situation is "a whole lot more dire" in Indian Country and that if members of Congress toured Indian Health Service facilities "they would be so embarrassed, they'd rush back to the Congress and do something about it."

Indian Affairs Committee Chairman Byron Dorgan, D-N.D., told the group that when the Senate considers the 2009 budget next week he will push an amendment adding $1 billion for Indian health care.

"I've done this before and I've lost before, but I'm not going to quit, I'm not going away," he said.

Dorgan said he would pay for the measure by closing tax loopholes that allow companies to route income through the Cayman Islands and other offshore tax shelters.

He also noted that Bush asked last year for $4 billion a week for the Iraq war.

"I say it's time to start investing in things here at home," he said to applause.

The Senate last week passed a long-overdue renewal of the Indian Health Care Improvement Act, which would fund medical services through 2017 and improve the quality of care provided in Indian Country.

The senators called it a good start but said more must be done. Dorgan said his committee will next tackle the issue of law enforcement in Indian Country. He said there are 40 percent fewer law enforcement personnel than needed on reservations.