Jennifer DePaul

Most private activity and conduit bonds do not have a substantial risk of being called if the proposed 28% cap on the value of tax exemption is enacted, Barclays Municipal Research said in a report.

The United States could be slapped with another credit downgrade this year from a major rating agency if there is a delay in raising the country's statutory borrowing limit or if lawmakers don't agree to a credible deficit reduction package.

The ranking Democrat on the House Ways and Means Committee said Tuesday that the Obama administration's proposed 28% cap on tax expenditures should be considered as a source of additional revenue in upcoming fiscal fights, but warned it should be viewed with caution.

If the proposed 28% cap on the value of tax exemption were enacted, the municipal bond market would become more volatile and would likely significantly deter investors from buying munis, Loop Capital Market's analysts said Monday.

A retroactive 28% cap on the value of tax exemption could trigger the mandatory redemption of billions of dollars of bonds, according to market experts.

Sen. Frank Lautenberg, D-N.J. and former Internal Revenue Service Commissioner Fred Goldberg have twice requested guidance from the Treasury Department to increase the availability of financing for rehabilitating affordable housing units damaged or destroyed by Hurricane Sandy.

The IRS is auditing $49.67 million of general obligation bonds issued by the Oregon State Board of Higher Education in 2006.

Preserving tax exemption for municipal bonds is a top priority for states, governors said Wednesday.

Hidden away in the fiscal cliff agreement is a two-year extension of empowerment zone tax incentives, including finance authority for enterprise zone bonds.

In the shadow of the fiscal cliff agreement, the likelihood of comprehensive tax reform that would seriously damage municipal bonds this year has slightly diminished, according to a research firm and other market participants.

Alabama has the highest national "impairment rate" at 15%, according to a new database that tracks state-specific municipal default rates.

The House overwhelmingly passed the first installment of Hurricane Sandy supplemental aid legislation Friday to increase the National Flood Insurance program's borrowing authority by $9.7 billion.

The House will vote on the first portion of a Hurricane Sandy aid package Friday, but it will not contain any municipal bond provisions and it's unlikely they will be included in future amendments.

After months of rancorous fighting, Congress narrowly passed a last-minute deal to avoid most of the scheduled tax hikes and spending cuts and did not include a cap on tax exemption, allowing the muni market to breathe a temporary sigh of relief.

The Internal Revenue Service's tax-exempt bond office plans to continue to invest significant resources in identifying abusive transactions in the municipal bond market in 2013.

Steve A. Chamberlin has been tapped to serve as acting director of the Internal Revenue Service's tax-exempt bond office, officials said.

State and local governments will be able issue a total of $33.170 billion of private-activity bonds under a national volume cap next year: 1.1% or $349.01 million more than in 2012.

The mere threat of including a 28% cap on the value of municipal tax exemption in a fiscal cliff deal has already caused munis to be more expensive for issuers and, if adopted, will fundamentally change the market, analysts and government groups warned Thursday.

The 100 largest public-employee retirement systems had $2.8 trillion in holdings and investments in the third quarter of 2012, a 2.6% increase from the same quarter last year and the highest level since the second quarter of 2008, according to a Census Bureau report.

House Speaker John Boehner's "Plan B" backup proposal to prevent some tax rate increases would make permanent two muni bond provisions that were originally enacted under the 2001 and 2003 Bush-era tax cuts.