GFOA is always on the lookout for news items that will be useful for finance professionals, research that might help you do your job better, and legal and regulatory updates you need to know about. Check the GFOA news page for the updates and any relevant GFOA announcements, and see the GFOA Newsletter archive for back issues of our weekly electronic newsletter.
The IRS priority guidelines released this month include two regulations of importance to many GFOA members: Issue price regulations and proposed rules on the definition of political subdivisions. The priority guidelines specify regulations that the U.S. Department of the Treasury will work on through June 30, 2017.
On August 24, 2016, the SEC Office of Municipal Securities issued a press release detailing enforcement actions against 71 municipal issuers and obligated persons for violations in municipal bond offerings from 2011 to 2014, as part of the Municipalities Continuing Disclosure Cooperation (MCDC) Initiative.
On February 1, 2016, the House of Representatives voted unanimously to approve HR 2209, bipartisan legislation that would require federal regulators to classify all investment-grade, liquid, and readily marketable municipal securities as high quality liquid assets (HQLA).
On August 15, 2016, S&P released commentary discussing the potential affects a continuing-disclosure settlement would have on muni credit from.
Throughout the month of August, your congressional delegation typically puts business on hold in Washington D.C. and heads home. The August Recess is designed to give members of Congress and their staff some time to reorient themselves, so it’s one of the very best times for constituents to meet with their members of Congress. Your advocacy during this period of time means the most because it allows your Congressional member to come face-to-face with the impact of federal preemption legislation, especially because of the deep fiscal impacts these have on localities within their districts.
It’s a work in progress—that’s how a new brief from the 40-state ACA Implementation Research Network, a project jointly operated by the Rockefeller Institute and the Brooking Institution, describes ACA implementation so far. Among the brief’s findings: Medicaid enrollments have exceeded early forecasts, as many people who had been eligible for Medicaid only learned of their eligibility when checking on the exchanges.
Reacting to a changing environment is nothing new for local governments, but determining the best response to change can still be difficult. Pueblo County, Colorado, used shared services to address its changing environment and made unexpected gains in the bargain. Faced with increasing software costs due to mandatory system upgrades, several Colorado counties began looking for other property assessment software options. Pueblo, one of the larger counties in the area, found out about the challenge its peers faced and offered to help by providing access to Pueblo County’s system.
As an associate member of the State and Local Legal Center, GFOA engages with other “Big Seven” members to write amicus briefs, ensuring that the court understands the impact of its findings on state and local governments. For a summary of the cases of special interest to state and local governments in 2016, take a look at the SLLC’s Supreme Court review summary.
Last week, a group of Senate lawmakers introduced legislation (S 3257) that would permanently raise the issuer limit on bank-qualified bonds from $10 million to $30 million. The legislation, which breathes new life into the effort to restore the annual issuer limit to $30 million, is the culmination of work by GFOA’s Federal Liaison Center with the offices of Senator Cardin (D-MD) and Senator Menendez (D-NJ).
Early this year, GFOA provided support for legislation aimed at addressing Puerto Rico’s current financial and humanitarian emergency. GFOA, along with other local government associations, provided support for House-side legislation known as PROMESA, while specifying that support would be withdrawn if any extraneous provisions affecting state and local government financial or pension matters were added. PROMESA passed the House on June 9, 2016, and is being considered by the Senate.
On June 24, 2016, House Republicans released a Blueprint for Tax Reform that is intended to act as a guide for future comprehensive tax reform. The strategy includes several significant reforms to the current tax code:
An Internet retailer has filed suit against the State of Alabama, claiming its new rule requiring that all retailers selling more than $250,000 in goods annually must collect sales tax – regardless of whether the retailer has a physical presence in the state – is unconstitutional. This is not the first lawsuit of its kind; a suit was filed earlier this spring challenging the State of South Dakota’s law, which is similar to the Alabama rule.
What is the Award Program for Small Government Cash Basis Reports?
For practical reasons, many small governments prepare their financial statements using either the modified cash basis or state-mandated regulatory basis of accounting, rather than generally accepted accounting principles (GAAP). The Government Finance Officers Association's (GFOA) Cash Basis Award Program is designed to help such governments improve the quality of their annual financial reports.
On June 6, 2016, Patrick J. McCoy, GFOA President-Elect and director of finance for the New York City Metropolitan Finance Authority testified on behalf of GFOA at a hearing held by the Internal Revenue Service and the Department of the Treasury on their proposed rule on political subdivisions. The proposal would increase restrictions on the definition of “political subdivision” for the purpose of being able to issue tax-exempt bonds.
The Implications of the SEC Rule and MSRB Rule G-42 on Hiring and Using Municipal Advisors and Underwriters
The new G-42 rule from the Municipal Securities Rulemaking Board (MSRB) becomes effective June 23, 2016. Rule G-42, or Duties of Municipal Advisors, stems from the Dodd Frank Act and the SEC’s subsequent municipal advisor rule. This rule does not establish any responsibilities for issuers, but it does create numerous responsibilities for the municipal advisors that are hired by state and local governments.
The information contained in this document was developed to educate members about the SEC MCDC Initiative and should not be construed as legal advice.
Issuers that self-reported under the SEC’s Municipalities Continuing Disclosure Cooperation (MCDC) initiative can expect to receive settlement offers containing standard provisions to which they must consent in the near future. The SEC is requesting an extraordinarily short turn-around for the settlement—5 to 10 days—but has indicated that it will extend the settlement offer upon request.
Marc Gonzales, Director, Department of Finance, Clackamas County, Oregon, became the new president of the Government Finance Officers Association of the United States and Canada (GFOA) at the association’s annual business meeting on May 24, 2016. During the past year, Gonzales served on the Executive Board as president-elect. He has been a member of the Executive Board since 2012. Gonzales accepted the gavel from 2015-2016 President Heather A. Johnston, City Manager, City of Burnsville, Minnesota.
Patrick J. McCoy, Director of Finance, Metropolitan Transportation Authority, New York, New York, was elected as president-elect of the Government Finance Officers Association of the United States and Canada (GFOA) on May 24, 2016. The election was held at the association’s annual business meeting in Toronto, Ontario, Canada.
Marc Gonzales, Director, Department of Finance, Clackamas County, Oregon, became president of the Government Finance Officers
Association of the United States and Canada (GFOA) on May 24, 2016. The gavel was passed at the association’s annual business meeting in Toronto, Ontario, Canada.