California Debt and Investment Advisory Commission

Webinar Description

Regulatory Update: The Municipal Advisory Rules and Their Effect on Public Investments
June 23, 2014
10:00 AM 11:00 AM Pacific Time
Cost: Free

With the effective date of the Municipal Advisory (MA) Rules approaching, the municipal market has been directed principally to the role and responsibilities of those persons providing advice with respect to the issuance of municipal securities. However, the rules have important implications for those providing advice to governmental entities on the investment of bond proceeds or the brokerage of municipal escrow investments. Treasury officials at the local level are already receiving letters from underwriting firms, who are informing clients that the MA Rules may prohibit them from continuing to sell and trade on behalf of the governmental entity. This webinar considers the Rules and their implications for treasury management. It will address:

  • When is a broker-dealer providing investment advice that would result in the broker-dealer being considered a municipal advisor?
  • What exemptions and exclusions do the MA Rules provide broker-dealers selling and managing public investments? What role does the governmental entity have, if any?
  • What alternatives, exemptions, and exclusions can apply for the investment of bond proceeds? Can government entities rely upon an independent registered municipal advisor (IRMA) or registered investment advisor (RIA) for advice and exempt broker-dealers who sell securities to an issuer for the investment of bond proceeds from the Municipal Advisor Rules?  What form of notice/acknowledgement can be provided to broker-dealers to invoke this exemption?
  • What should agencies do with the letters from brokerage firms? Why do letters vary among firms? Are all brokerage firms required to submit letters to governmental entities?
  • How do the MA Rules apply to pooled investments? What does the MA need to know to provide advice on pooled funds? How will pooled structures handle the investment of bond proceeds?
  • What are the different rules and assumptions that apply depending on whether the bond proceeds relate to municipal securities issued before or after July 1, 2014 (the effective date of the Rules)?