WASHINGTON — The Municipal Securities Rulemaking Board yesterday filed a new rule with the Securities and Exchange Commission that would allow it to collect a flat $60 “development fee” on examinations taken by municipal securities representatives and principals, as well as muni fund securities “limited principals,” to demonstrate competence in their areas of work.
“The proposed MSRB development fee is intended to partially cover costs incurred to develop and implement the examinations, costs associated with monitoring the examinations for effectiveness, and costs associated with updating the examinations’ content and questions,” the board said in its filing with the SEC.
The new development fee for exams comes after MSRB chairman Peter Clarke said in an interview with The Bond Buyer last month that the board had no immediate plans to raise its fees after it increased its annual fees for member firms and proposed removing some fee exemptions for short-term debt in recent weeks.
But MSRB general counsel Ernesto Lanza said yesterday that Clarke may have been referring to additional underwriting assessments, and said the board referred to the new development fees in an August press release when it announced the increases to its annual fees. Specifically, the release said that the board was also evaluating additional fees for its “professional qualifications tests.”
The MSRB had said that the previously announced fee increases would generate over $2.2 million in additional revenue each year. Lanza said that about 2,500 people take the exams each year, which means that the new development fees are expected to generate about $150,000 in additional revenue.
Under its new Rule A-16, which became effective immediately upon filing with the SEC, the board will begin to impose the $60 development fee for each of the three examinations beginning Jan. 4. The exams are the Series 51 Municipal Fund Securities Limited Principal Qualification Examination, the Series 52 Municipal Securities Representative Qualification Examination, and the Series 53 Municipal Securities Principal Qualification Examination.
The $60 development fee, combined with other fees assessed by the Financial Industry Regulatory Authority, which administers the exams on behalf of the MSRB, will bring the cost of the Series 51 exam to $145 and the cost of the Series 52 and Series 53 exams to $155 each.
On a periodic basis, FINRA will remit the fees it collects for development of the exams to the board and will retain the administrative fees it already collects for the delivery of the exams, the board said.
