2014 Conference Draft Agenda Now Available!

Conference Chair, Dr. Robert Kravchuk, recently completed the draft agenda for the 2014 ABFM Annual Conference, to be held October 2nd-4th at the Amway Grand Plaza Hotel in Grand Rapids, MI.

Click Here to View the Draft Agenda

Conference participants should register and make their hotel reservations as soon as possible.

Click Here to Register Online for the 2014 ABFM Conference

Click Here to Reserve Your Hotel Room (or call 800-253-3590)

Deadline for early registration rates is September 15th. Rooms are available at the conference rate of $134/night.

Call for Papers: IU Public Finance Miniconference, May 2015

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FEDERAL, STATE, AND LOCAL BUDGETS IN JEOPARDY: A CONFERENCE ON AMERICA’S FISCAL FUTURE
May 1-2, 2015
School of Public & Environmental Affairs, Indiana University
1315 E 10th Street, Bloomington, Indiana

Click Here for a PDF of this Announcement

America’s public finance system is largely in uncharted territory. Congress has abandoned its own budgetary process, major cities have declared or considered bankruptcy, and public pension systems and the viability of other unfunded liabilities is becoming an increasing source of concern. Healthcare spending is occupying a significant share of both state and federal non-discretionary spending. The federal politics of taxation has seemingly shifted from collecting revenue to serving symbolic gestures, while subnational governments compete with each other for an increasingly mobile tax base.

This conference will aim to evaluate the state of the American fiscal system and discuss its future by inviting scholars to present research on topics relevant to this topic. Paul Posner (George Mason University) will provide the luncheon keynote speech, and paper proposals will be competitively selected. We encourage submissions from all disciplines, including economics, political science, public administration, and law.

Possible areas include, but are not limited to:

  • Public budgeting and principles of sound finance
  • Debt, credit, and unfunded liabilities
  • Revenue instruments
  • Fiscal federalism and polycentricity
  • Healthcare
  • Tax and/or expenditure limitations
  • Intergovernmental transfers
  • Fiscal illusion
  • Business cycle management in a federalist system
  • Regional public competition for economic development
  • Public sector debt default or bankruptcy

Proposals: The deadline for submitting proposals is December 1st, 2014.

Proposals should include title, abstract, authors, and indicate your willingness to serve as a discussant.

Questions and proposals should be directed to Justin Ross, justross@indiana.edu.

Registration: There is no fee to register for the conference, but we do ask for registrations to be completed by March 30th, 2015.

Location and Schedule: The conference will take place in the School of Public & Environmental Affairs, 1315 E 10th Street, Bloomington, IN 47401. The conference will begin Thursday morning on May 1st, and break around noon on May 2.

Hotel Accommodations: A block of rooms has been reserved at the Biddle Hotel Indiana Memorial Union. Reserve online (http://imu.indiana.edu/hotel/) or call (800) 209-8145 and indicate that you are reserving for the “SPEA Public Finance Miniconference.” If reserving online, the block code is SPEAPFMC. Of the many hotels in Bloomington, the Biddle Hotel is the closest to the conference location with only a 5 minute walk.

About the IU Bloomington School of Public and Environmental Affairs
SPEA was founded in 1972 and is a world leader in public and environmental affairs and is the largest school of public administration and public policy in the United States. In the 2012 “Best Graduate Schools” by U.S. News & World Report, SPEA ranks second and is the nation’s highest-ranked professional graduate program in public affairs at a public institution. Four of its specialty programs, including public budgeting and finance, are ranked in the top-five listings. SPEA’s doctoral programs in public affairs and public policy are also ranked by the National Research Council
as among the top two in the nation.

ABFM Executive Committee & Officer Elections Open Until July 31st! Vote Now!

Online elections opened July 1st for ABFM’s Executive Committee and Officer positions becoming available January 1, 2015. These elections will remain open until July 31st, and all registered members of ABFM are encouraged to participate.

Access to the election page was distributed to ABFM members earlier this month. If you did not receive access, please contact our Secretariat, Meagan Jordan (mmjordan@odu.edu or (757) 683-6527.

The following are brief introductions of each of the candidates running for Vice-Chair, as well as for three positions on the Executive Committee. The Vice-Chair for 2015 will serve as Chair-Elect in 2016, Chair in 2017 and Immediate Past Chair in 2018. Those elected to Executive Committee will serve 3-year terms beginning January 1, 2015, and ending December 31, 2017.

Candidates for Vice-Chair (Vote for 1)

Craig S. Maher. I am a Professor in the School of Public Administration at the University of Nebraska at Omaha. I have been an active ABFM member for well over a decade, which includes presenting research, serving as panel chair and discussant, and serving on award committees.  The experiences I have had at these conferences over the years have been highly rewarding professionally and personally.  I am now in a position where I can give back to ABFM in a meaningful way.  I would like to help build on ABFM’s tradition of expanding the organization’s base by engaging with practitioners, academics, and leaders of complimentary professional associations.  I also want to ensure that the 2016 conference is relevant, meaning that the theme, keynote speakers, and topics discussed are valuable to the budgeting and finance field.

My research has spanned a broad spectrum in the budgeting and financial management field including: school finance, fiscal federalism, fiscal condition, budgeting priorities and institutional effects on fiscal decision.  I have served on committees for GASB, GFOA and ASPA.  I have also served as Research Director of a non-profit and held elective office.  I served five years on a City Council where I was appointed Chair of the Budgeting Committee.  My background should put me in a strong position to be an effective ABFM Chair.

As an ASPA member, I served on the committee that developed the winning proposal and managed the 66th ASPA National Conference in Milwaukee, WI (2005).  I also organized the Milwaukee Chapter of ASPA’s Second Annual Conference on State and Local Responses and Solutions to the Current Fiscal Crisis (March 2004).  These past experiences, coupled with the fact that I am at an institution where two of my colleagues are recent past chairs – John Bartle and Carol Ebdon – give me strong foundation and support for chairing the 2016 ABFM conference committee. ABFM Member since March 2001.

Dan Smith is an Associate Professor of Public Budgeting and Financial Management in the Robert F. Wagner Graduate School of Public Service at New York University (NYU Wagner), where he is Director of the finance specialization and teaches master’s and doctoral courses in government budgeting, public and nonprofit financial management, and econometrics. He has presented at ABFM’s conference annually since 2004, he is currently serving his final year on the ABFM Executive Committee, and he is ABFM’s representative to the Governmental Accounting Standards Advisory Council (GASAC).

In 2012, Dan led NYU Wagner’s effort to host the first-ever New York City meeting of ABFM’s annual conference, which registered the highest attendance and produced the highest registration revenues and donor sponsorships of the prior six meetings and generated a profit. Prior to his work on ABFM’s Executive Committee, he was program co-chair of the Public Finance and Budgeting section of the Western Social Science Association for two years, and for four years he was Treasurer and Chair of the Assets and Liabilities Management Committee of the Board of Directors of the New York University Federal Credit Union (NYUFCU). At NYUFCU, an independent and federally regulated financial institution, he was responsible for overseeing approximately $14 million in assets.

Dan welcomes questions about his ideas for the 2016 conference and ABFM more broadly at daniel.smith@nyu.edu. ABFM member since May 2002.

Candidates for Executive Committee (Vote for 3)

J. Edwin (Ed) Benton is a professor of political science and public administration at the University of South Florida.  He has written extensively about state, local, and intergovernmental fiscal behavior, urban and county government, state-local relations, and city-county consolidation.  His research has appeared in academic journals such as Public Administration Review, Social Science QuarterlyUrban Affairs ReviewJournal of Urban AffairsPublius: The Journal of FederalismPublic Opinion QuarterlyJournal of Public Administration Theory and PracticeState and Local Government Review, and American Review of Public Administration and in over a two dozen edited volumes.  He is the author of Intergovernmental Relations and Public PolicyCounties as Service Delivery AgentsGovernment and Politics in Florida, 4th edition, and Revenues Sources for Local Governments:  How Municipalities, Counties, and Townships Pay the Bills (forthcoming).  In addition, he is the author or co-author of over 50 technical and grant reports for state and local governments, local government associations, ICMA, and non-profit organizations.  He has served on the several editorial/advisory boards (State and Local Government ReviewAmerican Review of Public Administration, and Florida Political Chronicle, and National Center for the Study of Counties) and is currently the Managing Editor of the State and Local Government Review. ABFM member since March 1999.

Marlon I. Brown: My name is Marlon Brown and I desire to serve on the ABFM Executive Committee for the 2015-2017 term.  I currently work for the State of Michigan as a Budget and Policy Analyst in the State Budget Office.  I am also a councilman for the City of Mason, MI and an adjunct instructor at Davenport University.  My prior work experience includes serving as a management analyst for the Michigan Supreme Court and serving as the Associate Director of the Gerald R. Ford Institute for Public Policy at Albion College.  My educational credentials consist of a Bachelor’s degree in political science from the American University, and a Master of Public Administration with a specialization in city management from the University of Delaware.  It is because of my diverse background that I am confident I could bring a unique perspective to the ABFM Executive Committee.  One of my goals would be to work with ABFM leaders to broaden our reach to younger professionals aspiring toward careers in public service or academia.  I also believe that my experiences as a practitioner, and as a local elected official, could be useful in enhancing the scope and work of ABFM. ABFM member since July 2009.

David Chapinski is a 3rd-year PhD student at Rutgers SPAA, Conference Committee Board Member, Course Developer for Doctoral Programs, Adjunct Faculty, Contributing Writer of local government and public administration issues as well as Academic Conference Referee.  In April 2013, David was appointed NEDSI Conference Session Chair for the Health Care Management Track, at the Northeast Decision Sciences Institute 2013 New York Conference, Brooklyn, NY.
David’s research focuses on urban policy and corporate relationships.  David is particularly interested in studies of public economies: Multi-organizational, Multi-level Institutional and Risk Analysis. What, for example, might the organization and governance of more complex protected areas have in common with complex metropolitan areas like New York City, Washington D.C. David has successfully maintained posts as an Adjunct Instructor at Felician College, Long Island University, Manhattan College, St. Francis College, Bergen Community College.  He holds a master’s degree in public administration from Fairleigh Dickinson University’s Public Administration Institute (PAI) and a BA in Political Science from Rutgers College, Rutgers University. ABFM member since April 2014?

Jacob Fowles is an Assistant Professor in the School of Public Affairs and Administration at the University of Kansas, a position that he has held since 2010.  He teaches graduate courses on public finance, policy analysis, program evaluation, and quantitative research methods.  Jacob’s research interests are in the areas of education finance, education policy, municipal finance, and nonprofit financial management.  His work has appeared or is in press in such journals as Public Budgeting and Finance, The American Review of Public Administration, Economics of Education Review, and Education Finance and Policy, among others.  He received his doctorate in public administration in 2010 from the Martin School of Public Policy and Administration at the University of Kentucky.

Personal Statement:
I consider ABFM to be my primary intellectual home and have participated in its annual conference since 2007, serving as a panel organizer, chair, discussant, and presenter.  The relationships that I have developed through my association with ABFM have been instrumental in shaping my ongoing development as a scholar of public budgeting and finance.  I value the organization’s collegiality, its emphasis on intellectual development and rigor, and its dedication to connecting academics and practitioners around the common objectives of sharing knowledge and improving policy and practice.  As such, I am excited at the opportunity to take the next step in my involvement with the organization by serving on the association’s executive committee.  ABFM member since September 2010.

Hai (David) Guo is an assistant professor of public administration at Florida International University. His research focuses on state and local public finance and budgeting. Dr. Guo holds his Ph.D. degree in Public Policy from the Joint Doctoral program of public policy of the Andrew Young School of Policy Studies at Georgia State University and Georgia Institute of Technology’s School of Public Policy. He obtained his master degree in Economics from Georgia State University and a master degree of Public Administration from Iowa State University. As a public administration scholar, he has published in Journal of Public Administration Research and Theory, American Review of Public AdministrationJournal of Public Budgeting Accounting & Financial Management, Municipal Finance Journal, and Public Procurement.

Prior to joining the department of Public Administration at FIU, Dr. Guo has been working with Dr. Willoughby on the Government Performance Project (funded by the Pew Trusts Center on the States). This Project is a 50 state survey that assesses how well state governments perform their management functions. The team at Georgia State conducted analyses for the Money section of the survey in 2004 and 2007 for publication in Governing magazine. (A complete explanation of this project and results in available at http://www.pewcenteronthestates.org/). ABFM member since July 2007.

Professor Temirlan Moldogaziev’s primary research and teaching interests are in matters of financial inter-mediation, municipal securities pricing and liquidity, municipal debt market regulation, and market-building & access to capital for sub-national governments. He is a coauthor of State and Local Financial Instruments: Policy Changes and Management (2014). His most current work has been published in peer reviewed journals such as Public Budgeting & FinancePublic Administration ReviewMunicipal Finance Journaland Journal of Public Administration Research and Theory. He served as a conference chair of the Public Finance & Budgeting (PFB) section at WSSA in 2014. ABFM Member since August 2010.

Michael Peddle serves as Associate Professor of Public Administration in the School of Public and Global Affairs at Northern Illinois University.  An economist and accountant by training, he earned his MPA at Drake University and his Ph.D. in economics from Northwestern University.  He has published and consulted extensively in the areas of public finance, local economic development, growth management and strategic planning over the past thirty years.  He has practitioner experience at the local, state, and national level, as well as in the not-for-profit sector.  He has been a regular attendee and presenter at ABFM over the past twenty years and considers it his professional home. ABFM member since January 2001.

Olga Smirnova is an assistant professor at the MPA program, the Department of Political Science, East Carolina University. Her research interests include transportation, green transportation innovations, institutional stability, economic development, social networks, performance measurement, and visualizations of complex systems. She has published in the Public Administration Review, Journal of Public Transportation, Southeastern Geographer, Municipal Finance Journal, North Carolina Geographer, and Administration and Society. She has been a member of ABFM since 2009.

Bryan Sullivan: I am the Director of Management Efficiency for the State of Delaware’s Office of Management and Budget, Budget Development, Planning and Administration section.  I earned my M.P.A. and Ph.D. from the University of Delaware’s College of Urban Affairs and Public Policy.  My service to ABFM has been extensive: I served as Treasurer (2007 – 2012), member of the Executive Committee (2004 – 2006), and have participated as a member of the Howard Award Committee, the Curro Award Committee, the Membership Committee and the planning committees for several of the annual conferences.   I am seeking to continue my service to ABFM and focus on facilitating and supporting enhanced dialogue and interactions between budget practitioners and the academics who study them and their decisions and outcomes—especially in the areas of mutual interest regarding budgeting, performance and accountability, and training future budgeteers.  ABFM member since April 1989.

Multiple Early-Career Local Analyst Positions in the Carolinas

helpwantedThe North Carolina Local Government Budget Association (NCLGBA) posted several updates to their Career Gateway site, including vacancy announcements for numerous analyst positions with local governments in North Carolina and South Carolina.

Many of these positions are intended for recent graduates of college and graduate school, as well as early-career professionals in the field of local budgeting. Click on the links below to check out the descriptions and application information for each position:

Fiscal & Policy Analyst – Wake County, NC (Closes July 6th)

Budget & Management Analyst – City of Greenville, SC (Closes July 11th)

Financial Analyst – City of Greenville, NC (Closes July 15th)

Budget Analyst – Cabarrus County, NC (Open Until Filled, Seeking Candidate with Some Accounting Background)

Budget Analyst II – Richland County, SC (Open Until Filled)

Richland County, SC, also has a vacancy for Budget Manager. Click here for more information on this vacancy.

 

PA Times Accepting Articles for “Expanding the Role of Public Administration”

PATimesFrom President Obama’s ‘Open Government Initiative’ to the increased promotion and use of technology to engage citizens, the traditional roles and expectations of public administration are expanding. While many believe this expansion helps everyone—from individuals to the experienced legislator—those that work in the public sector struggle to find the best methods to inform, engage and increase participation.

  • What barriers exist to increasing public participation?
  • How are public managers implementing open government policies in their agencies?
  • How have technologies—such as online forums, listervs and social media outlets like Twitter—influenced public participation?
  • How can governments, especially at the state and local levels, engage citizens to participation?
  • Do current laws and policies allow the public sector to fully embrace the concept of open government or citizen participation?

Public Service, Public Delivery – Alternatives to Delivering Public Goods

Using private entities to delivery public goods and services, like trash collection or road repairs, is nothing new. Local and state governments in particular, often dealing with cash-strapped budgets, turn to outsourcing as an option. While using private companies can save time and money, and build good will, doing so is not without some risk.

  • Should there be restrictions on which services are outsourced?
  • How do public managers determine which services are outsourced?
  • When it comes to the public, does it matter who provides services?
  • How do public administrators deal with issues of non-performance?
  • How does this issue impact the role and work of the public sector employee?
  • How do alternatives providers, such as nonprofits or citizen groups, fit into the discussion?

Articles must be received by July 18 to be considered. Here are few guidelines:

  • Articles must be submitted as a Microsoft Word document.
  • Articles should be between 800-1000 words.
  • Articles should not include end/foot notes or a bibliography. All citations should be done inside the article and include hyperlinks (where possible).
  • Articles should be written in AP style format. Click here to review the PA TIMES style guide.

Please review the submission guidelines prior to sending your piece. If you have any questions, please contact PA TIMES editor Melissa Williams atpatimes@aspanet.org

GFOA Announces First-Time Winner of Cash Basis Reporting Award

JunctionCity(NEWS RELEASE) The GFOA Award Program for Small Government Cash Basis Reports is happy to announce a first-time winner of the award: the City of Junction City, Oregon. Receiving this award demonstrates Junction City’s exceptional dedication to transparency, accountability, and financial reporting on a modified cash basis. All staff involved in attaining this distinction for the city should be commended for their accomplishment, and the GFOA offers its congratulations.

The Award Program for Small Government Cash Basis Reports aims to improve the quality and consistency of financial reporting for small governments. It is designed for the thousands of small governments for which financial reporting in conformity with generally accepted accounting principles is not a viable option. For some participants, the program may be a first step toward GAAP financial reporting.

Junction City, along with Cashion, Oklahoma, are the first two winners of the award for fiscal year 2013.

Go to the Award Program webpage to download an application. Checklists are also available for general-purpose governments, school districts, and stand-alone business-type entities, along with a sample small government annual financial report. Questions? E-mail cashbasis@gfoa.org. For information on volunteer opportunities, e-mail cashbasisreview@gfoa.org. We look forward to your participation.

Update on Federal Budget and Funding Progress (from NASBO)

nasbo logoNational Association of State Budget Officers (NASBO) publishes an electronic update, “Washington Report,” tracking federal issues impacting states, especially the Federal Budget. The following is a segment from the June 18, 2014, edition. Click here to subscribe to NASBO’s Washington Report.

Lawmakers Mull Options to Prevent Highway Trust Fund Shortfall  

Yesterday, the Department of Transportation (DOT) updated its Highway Trust Fund Ticker based on current spending and revenue trends. The projections continue to estimate that the Highway Account of the Highway Trust Fund (HTF) will encounter a shortfall before fiscal 2014 ends on September 30, 2014. Moreover, the account is still projected to fall below the critical threshold of $4 billion deemed necessary by DOT to maintain solvency and fulfill all funding obligations. Once the cash balance reaches this level, DOT has said it may need to use certain cash management strategies, including delaying reimbursements owed to states. Meanwhile, the Mass Transit Account is projected to end the fiscal year with a balance of roughly $1 billion. Besides the looming HTF shortfall, the current surface transportation reauthorization (MAP-21) is also due to expire on September 30 when this fiscal year ends. The Senate is considering options to provide for a short-term patch of the HTF and extension of MAP-21 for roughly six months, which would give lawmakers until the lame-duck session following the November election to negotiate a long-term funding bill. House leaders are also working to develop their own plan for the HTF, after setting aside an earlier proposal to use postal savings to fund a MAP-21 extension through May 2015. While most observers believe Congress will act before the August recess to shore up the HTF and avoid the “July cliff” when DOT would begin slowing reimbursements to states, lack of action thus far is causing uncertainty for state officials planning and managing transportation projects.

Senate Considers Fiscal 2015 Spending Package of Three Domestic Bills 

Yesterday, a package of three fiscal 2015 spending bills cleared its first procedural hurdle in the Senate, with a 95-3 vote to limit debate on the motion to proceed to the legislation. The roughly $126 billion discretionary spending package (HR 4660) includes the appropriations bills for Transportation-Housing and Urban Development (S 2438), Commerce-Justice-Science (S 2437), and Agriculture (S 2389). Senate Majority Leader Harry Reid (D-NV) has indicated that how this package of spending bills is addressed will help determine the path forward for the fiscal 2015 appropriations debate in the weeks ahead. Senate Appropriations Chairwoman Barbara Mikulski (D-MD) has indicated that there are no major substantive conflicts over the spending bills, but leaders are working on an agreement regarding the amendment process and other rules that will structure the debate.

Transportation-Housing and Urban Development (THUD): The THUD bill would provide discretionary spending authority of $54.4 billion, including $18.1 billion for the Department of Transportation (DOT) and $36 billion for the Department of Housing and Urban Development (HUD). Additionally, on the mandatory side, the bill calls for $53.6 billion in limitations on obligations for DOT, including $40.3 billion for the Federal-aid Highways program (equal to the enacted fiscal 2014 level). This funding level is based on the assumption that the current surface transportation authorization law (Moving Ahead for Progress in the 21stCentury Act or MAP-21) is extended through fiscal 2015. For HUD, the bill also includes $9.8 billion in offsetting program receipts, which boosts the agency’s total fiscal 2015 funding level to $45.8 billion. The total budgetary resources for DOT (both discretionary and mandatory) is $536 million more than the fiscal 2014 enacted level, while the total program funding for HUD is $369 million more than the current enacted level. See bill summary for more information.

Commerce-Justice-Science (CJS): The CJS bill would provide $51.2 billion in total discretionary funding, roughly $400 million less than the current enacted level for fiscal 2014. The bill provides $2.3 billion to support state and local law enforcement, which is $10 million more than the President’s budget request and $11 million less than the fiscal 2014 enacted level. This includes $376 million for Byrne Justice Assistance Grants, $181 million for Community Oriented Policing (COPS) hiring grants, $430 million for Violence Against Women Act programs, and $258 million for juvenile justice grants. The measure also includes a one-year exemption for states from financial penalties under the Prison Rape Elimination Act (PREA) for certain grant programs. See bill summary for more information.

Agriculture: The Agriculture spending bill would provide $20.6 billion in discretionary spending authority, which is $90 million below the current enacted level. The bill also includes $100 million in additional spending on disaster relief for the Emergency Watershed Protection Program and the Emergency Forestry Restoration Program. The bill would reduce spending for the Special Supplemental Nutrition Program for Women, Infants and Children (WIC) by $93 million, based on departmental estimates of declining WIC program enrollments. See bill summary for more information.

House and Senate Committees Mark Up Energy-Water Spending Bills

Yesterday, the Senate Energy and Water Development Appropriations subcommittee approved the fiscal 2015 Energy-Water spending bill that includes $34.2 billion in discretionary spending authority, $148 million more than the current enacted level. The full Senate Appropriations Committee is scheduled to take up the measure tomorrow. According to reports, Senate Minority Leader Mitch McConnell (R-KY) is planning to attend the markup and propose an amendment that would aim to block further advancement of rules proposed by the Environmental Protection Agency (EPA) to reduce carbon emissions of existing power plants. Specifically, the amendment would not allow the rule to move forward without certification that the rule would not cause electricity prices to rise or jobs to be eliminated. Today, the full House Appropriations Committee marked up and approved its $34 billion draft Energy-Water spending bill, which would increase funding for research on fossil fuel energy sources, while reducing funding for renewable energy research.  

Boston Fed takes look at State Debt Affordability

fedboston(PRESS RELEASE) New research from the New England Public Policy Center at the Federal Reserve Bank of Boston explores the different ways to assess the affordability of state debt and uses those findings to offer guidance to states in examining their own debt burdens.

State governments commonly issue debt to finance the construction of roads, schools, and other investments in infrastructure that are important for economic growth and competitiveness.
“While borrowing funds can facilitate these investments, there is also a danger in allowing debt to grow unchecked,” said the report’s author, Senior Policy Analyst Jennifer Weiner. “If debt service is too high, it can crowd out other public spending or increase taxes and fees, so policymakers must carefully balance a state’s capital needs with efforts to keep debt levels affordable.”

The report highlights some considerations faced by policymakers or analysts when gauging state debt affordability, including how to define state debt and which metrics and approaches can help assess state debt burdens. It also offers recommendations to help policymakers assess the affordability of potential debt. These include improving transparency around various forms of state debt, examining alternative definitions of debt and multiple debt burden ratios, and timing affordability analyses to inform capital planning.

This paper and an accompanying policy brief that highlights common elements and best practices found in state debt affordability studies are both now available here:

http://www.bostonfed.org/economic/neppc/index.htm

GFOA Provides Guidance on Selecting, Managing Municipal Advisors

Bonds(PRESS RELEASE) On July 1, 2014, the SEC’s Municipal Advisor Rule will take effect. The rule imposes a fiduciary duty on municipal advisors to their government clients and changes the manner in which underwriters and other professionals are permitted to interact with issuers. While the rule does not regulate issuers directly, there are numerous indirect implications that governments should be aware of.

To help GFOA members prepare for the rule’s fast approaching implementation date, the GFOA has developed a suite of resources, which are available at the GFOA’s Municipal Advisor Rule Resource Center. The resource center provides members with a brief background and overview of the Rule, links to the MA Rule Alert and a 10-page issue brief, as well as links to the SEC’s frequently asked questions documents that provide interim guidance on the rule.

The resource center also includes links to three best practices, which GFOA updated with recommendations to governments about hiring and managing municipal advisors and underwriters after July 1. These best practices include Selecting and Managing the Engagement of Municipal Advisors,Selecting and Managing Underwriters for Negotiated Bond Sales, and Selecting and Managing the Method of Sale of Bonds. The GFOA’s existing recommendations were already largely consistent with the new rule, advising governments to use a municipal advisor when considering a bond transaction unless the government has sufficient internal expertise. However the best practices were also updated to alert issuers to changes including:

  • Municipal advisors have a new fiduciary responsibility to issuers.
  • Underwriters do not have this fiduciary duty to issuers.
  • While municipal advisors can play a key role on an issuers team in approaching and executing a bond transaction, the issuer must remain in control of the decision-making process, define the scope of work, and control the engagement with the municipal advisor.

Beyond these best practices, the GFOA also recommends that issuers of new bonds also review the other best practices in this series, which include Selecting Bond Counsel and Pricing Bonds in a Negotiated Sale.

Call for Topics – 2015 GFOA Annual Conference

The GFOA invites topic and speaker suggestions for the 109th Annual Conference, May 31-June 3, 2015, in Philadelphia, Pennsylvania. Sessions will be announced in early 2015.

Click Here to Submit a Topic for the 2015 GFOA Conference