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On May 23, the Pennsylvania House of Representatives approved Senate Bill 234, which creates the Property Assessed Clean Energy (PACE) Program. SB 234, which was approved by the Senate in January of this year, would help owners of agricultural, commercial and industrial properties obtain low-cost, long-term financing for energy efficiency, water conservation and renewable energy projects. The program would not include multifamily housing or other residential property.
Continue Reading Pennsylvania Legislature Approves New Municipal Alternative Energy Program

On Monday, May 14, the United States Supreme Court announced its eagerly awaited decision in Murphy v. National Collegiate Athletic Association and, as many expected, struck down the Professional and Amateur Sports Protection Act (“PASPA”), a federal law that prohibits states from authorizing and regulating sports wagering.
Continue Reading Supreme Court Opens Door to Sports Betting in all Fifty States

On December 12, 2017, the Board of Governors of the Federal Reserve System (FRB) issued Notice 2017-26761 (82 FR 58397, Docket Number OP-1573) expressing its intent to begin publication during the second quarter of 2018 of three overnight repurchase transaction reference rates.  The FRB began publication of these rates through the Federal Reserve Bank of New York on April 3, 2018.
Continue Reading Federal Reserve Board Now Publishing SOFR And Other Alternative Repo Rates

On May 11, 2016, the Department of Treasury, Financial Crimes Enforcement Network (FinCEN) published its final rule (81 FR 29298) on required “know your customer” due diligence procedures (Rule).  The Rule established a compliance deadline of May 11, 2018 for all “covered financial institutions.”
Continue Reading Fincen Customer Due Diligence Rule Compliance Deadline Approaches

When Congress passed the Tax Cuts and Jobs Act (TCJA) late last year, a much-heralded provision of TCJA was the reduction in the federal corporate income tax rate, from 35% to 21%. However, that reduction has had unforeseen consequences for the municipal bond industry. The reduction in the tax rate is expected to result in efforts by banks to increase the interest rates charged by banks for current outstanding loans to municipalities and 501(c)(3) tax-exempt organizations. Whether a bank may increase the interest rate on a loan will depend on the language of the loan documents. Even if the loan documents permit the bank to unilaterally increase the interest rate, some banks may be hesitant to do so, as the request is may be received poorly, potentially jeopardizing the bank’s ongoing relationship with the borrower.
Continue Reading Continuing Disclosure in the Municipal Bond Market: Importance of Compliance

On April 11, 2018, the Internal Revenue Service published Revenue Procedure 2018-26, a copy of which can be accessed here, which provides new guidance to issuers on the availability of remedial actions to preserve the tax-advantaged status of their bonds in the face of a violation of the tax rules. Rev. Proc. 2018-26 applies to tax-advantaged bonds generally, i.e. traditional tax-exempt bonds under section 103 of the Code, as well as federally taxable bonds that carry with them tax credit or direct pay subsidy benefits.
Continue Reading IRS Issues Guidance on Remedial Actions for Tax-Advantaged Bonds

On March 29, 2018, the National Association of Bond Lawyers (NABL) formally requested guidance from the IRS regarding the ability of municipal issuers to issue tax-exempt advance refunding bonds to refund taxable bonds after the enactment of the Tax Cuts and Jobs Act (TCJA). The request comes on the heels of public statements by Treasury and IRS representatives regarding their belief that notwithstanding the passage of TCJA, municipal issuers may continue to issue tax-exempt advance refunding bonds to refund taxable bonds, so long as the taxable bonds to be refunded are not tax-advantaged bonds such as Build America Bonds, and the refunding otherwise complies with the requirements of section 149 of the Code and the regulations thereto.
Continue Reading NABL Requests IRS Guidance on Tax-Exempt Advance Refundings of Taxable Bonds

On December 4, 2017, the Supreme Court of the United States heard oral arguments in Christie v. National Collegiate Athletic Association, No. 16-476, regarding the constitutionality of the Professional and Amateur Sports Protection Act (“PASPA”), a federal law that prohibits states from authorizing and regulating sports wagering. The case could have significant implications for legal and regulated gambling across the country, including Pennsylvania, where the General Assembly recently passed legislation that would authorize sports wagering in the Commonwealth if PASPA is found to be unconstitutional or is repealed by Congress.
Continue Reading Sports Wagering in Pennsylvania Could Soon Become a Reality