News

In the year ended June 30, 2014, U.S. state and local-government pension investments earned the highest returns seen in three years, according to a report from Wilshire Associates, as reported by Bloomberg. Public pension returns increased by 16.9%, the best performance since fiscal 2011, when returns increased by 21.2%. Funds with more than $1 billion in assets performed best, with a median increase of 17.4%, attributed to larger alternative asset allocations.

On August 1, 2014, the SEC’s Enforcement Division announced that it will extend the deadline for state and local government issuers to participate in the commission’s Municipalities Continuing Disclosure Cooperation (MCDC) Initiative from September 10, 2014 to December 1, 2014.

On July 24, 2014, the Electric Power Board of Chattanooga, Tennessee, and the City of Wilson, North Carolina, filed separate petitions asking the FCC to consider whether their states’ laws prohibit the deployment of high-speed broadband services in a reasonable and timely manner. FCC Chairman Tom Wheeler has spoken repeatedly about his desire to address state laws that prohibit or restrict municipal broadband networks. These petitions provide the chairman the opportunity to take action.

The GFOA joined other national associations representing local governments on a letter (see below) to the Senate urging support for the Marketplace and Internet Tax Fairness Act (MITFA, S. 2609). This legislation, introduced by a group of bipartisan senators on July 15, 2014, would combine the Marketplace Fairness Act that passed the Senate last year with a 10-year extension of the moratorium on Internet access taxes that is set to expire November 1, 2014.

On July 23, 2014, the SEC voted 3-2 to approve a final rule on its 2013 proposal to institute reforms to money market mutual funds. The commission’s final rule contains a number of components that were included in its 2013 proposal – which the GFOA opposed and commented on in an independent letter and as part of a state and local association coalition last fall. (See both letters below.) Such provisions require institutional prime, retail, and municipal (tax-exempt) funds to maintain a floating net asset value instead of a stable NAV, which had existed previously.

Metros found to have high walkable urbanism are models for the future development patterns of many of the largest 30 U.S. metros, according to Foot Traffic Ahead, a recent study from the Center for Real Estate and Urban Analysis at the George Washington University School of Business.

On July 15, 2014, the House of Representatives passed the GFOA-opposed Permanent Internet Tax Freedom Act (HR 3086). The bill would permanently preempt state and local governments’ authority to assess taxes on Internet access and would specifically remove that authority from ten states that are currently permitted to do so under current law – Hawaii, New Hampshire, New Mexico, North Dakota, Ohio, South Dakota, Tennessee, Texas, Washington, and Wisconsin.

A new issue brief from the Center for State and Local Government Excellence examines the rationale for issuing Pension Obligation Bonds and how they have performed since the financial crisis.

Today, the released a new report, Investing in Results: Using Performance Data to Inform State Budgeting, a new report from the National Association of State Budget Officers, highlights some key themes and lessons learned for using performance information in state budgeting, planning, and program management, based on state budget officer discussions on this subject as well as several state-specific case studies.

The GFOA, along with several other national associations representing local governments, sent a letter to the House of Representatives urging members to vote no on the passage of the Permanent Internet Tax Freedom Act, HR 3086. If enacted, the bill would permanently preempt state and local governments’ authority to assess taxes on Internet access and would specifically remove that authority from ten states that are currently permitted under current law to assess such taxes. The full House will consider the GFOA-opposed legislation during the week of July 14, 2014.

The Congressional Budget Office estimated that the Permanent Internet Tax Freedom Act (H.R. 3086), if enacted, would cost states and localities several hundred million dollars a year. The bill would permanently preempt state and local governments’ authority to assess taxes on Internet access and would specifically remove that authority from ten states that are currently permitted under current law to assess such taxes. The House Judiciary Committee recently approved H.R.

“Best in class” public transportation systems provide cities with extensive benefits, according to the Smart Cities Council.