Naomi Jagoda

WASHINGTON —The federal government ran a $75.1 billion budget surplus in September, the Treasury reported Wednesday, resulting in a fiscal year 2013 deficit of $680.3 billion.

The Fed will continue open-ended programs to purchase longer-term Treasuries at a rate of $45 billion per month and mortgage-backed securities at a rate of $40 billion per month, the Federal Open Market Committee said in a statement released Wednesday following the committee's two-day meeting.

Three Senate Democrats introduced a bill on Tuesday that they say is intended to significantly reduce the chances that either political party could use the debt limit to pursue unrelated policy changes.

More than three-quarters of U.S. public finance rating changes made by Moody’s Investors Service in the third quarter of 2013 were downgrades, reflecting concentrated credit pressures in some areas of the country even as economic recovery is seen on a larger scale.

Democrats on the House Ways and Means committee are urging the committee’s Republican chairman to work in a bipartisan manner to write tax-reform legislation.

Fitch Ratings made more U.S. public finance downgrades than upgrades during the third quarter of 2013, while Standard & Poor’s boosted more ratings than it cut, the rating companies said in reports this week.

The Internal Revenue System has closed an audit of bonds issued by the board of regents of the University of Houston System in 2004 with no change to the bonds' tax-exempt status.

More than a dozen additional Wisconsin issuers have recently disclosed that they can redeem their Build America Bonds and other direct-pay bonds because of sequestration-mandated cuts in their federal subsidy payments.

Existing home sales decreased 1.9% in September to a seasonally adjusted 5.20 million-unit rate, after a downwardly revised 5.39 million unit rate in August originally reported as 5.48 million units, the National Association of Realtors announced Monday.

The recently formed congressional budget conference committee could include changes to sequestration and/or broad principles for tax reform in any agreement, if it is able to reach one, observers in the municipal bond market said.

Roughly $23 million of tax-exempt senior lien revenue bonds issued in 2003 to finance a jail may be taxable private activity bonds, an Internal Revenue Service agent has told the West Texas Detention Facility Corp.

Federal proposals to curb or eliminate tax exemption for bonds used by nonprofits would result in losses in employment, gross domestic product and labor income, according to a report released Wednesday.

Fitch Ratings said it placed the United States' triple-A rating on negative rating watch, just two days before the U.S. Treasury is expected to exhaust extraordinary measures to finance government spending without raising the $16.7 trillion debt limit.

The 7.2% reduction in federal subsidy payments to Build America Bond issuers for fiscal year 2014 is credit negative for issuers that rely on the subsidy to make debt service payments on the bonds, Moody's Investors Service said.

Fitch Ratings said it will consider putting the United States on a negative rating watch if the debt ceiling is not increased by Oct. 17, when the U.S. Treasury is expected to exhaust extraordinary measures and will be forced to rely on cash on hand and incoming revenues.

The National Governor's Association is calling for Congress and the Obama administration to promptly reopen the federal government and to "commit to fully reimbursing states and territories for the federal expenses they absorb during the shutown."

States can benefit from investing pension funds in infrastructure, experts said, though there were some concerns from state treasurers.

The National Association of State Treasurers elected officers for 2014 and adopted several bond-related resolutions, during an annual business meeting at its conference here on Monday.

A lot of work needs to be done in Detroit, but the city has a great deal of potential, Michigan State Treasurer Andy Dillon said.

A short-term federal government shutdown will have minimal impact on issuers, though some areas with a significant federal presence like Washington D.C. may see some lost economic activity, ratings agencies said.