It took MuniDeals.com all of 10 days to become the first "qualified portal" under the Municipal Securities Rulemaking Board's new disclosure regulations.
The five-person company, run by a former vice chairman of Salomon Brothers and his brother, was already providing most of the services prescribed under the MSRB's standards.
Effective July 1, the MSRB passed a new slate of rules for municipalities floating debt.
Any official statements would have to be filed electronically under the MSRB's EMMA system.
The issuer could also file with a qualified portal.
A qualified portal was defined as a Web site that allowed users to see statements online, offered hard copies of the statements to users who requested them, hyperlinked to EMMA, and allowed users to search for an issue by CUSIP.
With the exception of the final two prerequisites, MuniDeals.com had been offering those services since 2004.
All the site had to do was link to EMMA and add the CUSIP search function.
The company did not even have to secure approval with the MSRB.
"When we set up our Web site, we anticipated the move by the federal regulators to move toward a paperless filing mechanism," said Jim Higgins, chief executive officer of MuniDeals.com. "When the MSRB came out with its newest regulations, it was a natural extension for us to make some real minor modifications to our Web site and become a qualified portal."
Higgins and his brother Jay are the two principals of the company, the production offices of which are in Detroit.
The value of a qualified portal is it allows issuers to save money on printing and shipping costs, Higgins said.
Issuers who file only with EMMA still have to print the official statements and make them available to prospective buyers. EMMA does not provide the hard copy.
Issuers can elect to outsource the distribution of official statements. The qualified portal provides hard copies to anyone who want them.
The difference between sending hard copies to everyone and only to those who request them can mean significant savings, Higgins said.
"They eliminate a complete step in terms of the disclosure requirements to the bondholder," he said, referring to the automatic printing and distribution of statements. "It significantly reduces the amount of printing and the amount of shipping."
The migration from hard copies to electronic filings has been "inevitable," Higgins said.
Some people at the company were part of the digitalization of corporate filings with the Securities and Exchange Commission, through the EDGAR system, the company said.
The MuniDeals.com process - in which in lieu of a hard copy the company sends an "iStatement" notifying of an electronic filing - is similar to the process used for corporate proxy filings, the company said.
"The iStatement releases the broker-dealer from the burden of using expensive fulfillment houses and express mail to get a printed official statement into the hands of a bond purchaser," a statement from the company said.
