Washington

WASHINGTON — ­Municipal market participants are still weighing the implications of a bill that would eliminate tax-exempt bonds and shift the muni market wholesale to a tax-credit subsidy, with many warning it would hurt state and local governments still recovering from the recession.

WASHINGTON — The Justice Department announced Wednesday that Daniel Naeh, a former CDR Financial Products Inc. employee living in Israel, pleaded guilty Tuesday for his participation in bid-rigging and fraud conspiracies related to guaranteed investment contracts and other municipal finance agreements.

WASHINGTON — The Justice Department announced Wednesday afternoon that Daniel Naeh, a former CDR Financial Products Inc. employee who is living in Israel, pleaded guilty Tuesday for his participation in bid-rigging and fraud conspiracies related to contracts for the investment of municipal bond proceeds and other muni contracts.

New tax reform legislation unveiled Tuesday by Sens. Ron Wyden, D-Ore., and Judd Gregg, R-N.H., would eliminate tax-exempt bonds beginning in 2011, change the tax exemption for state and local bonds to a tax credit, and prohibit the advance refunding of bonds.

WASHINGTON — The Securities and Exchange Commission formally released a series of final changes to its Rule 2a-7 on money market funds Tuesday aimed at boosting the resilience of funds during market crises, and set a March 5 effective date for them.

The horizon continues to appear gloomy for state and local governments heading into 2010, with two reports by Fitch Ratings and the Nelson A. Rockefeller Institute of Government this week predicting another year of crunched state and local finances.

Peter Roberson has left his position as a senior policy adviser to the House Financial Services Committee to become vice president of government relations at IntercontinentalExchange Inc., which operates futures and over-the-counter derivatives exchanges and clearinghouses.

Senate Banking Committee chairman Christopher Dodd, D-Conn., is expected to unveil a revised financial regulatory reform bill by the end of the week, but it is not expected to include any changes to the municipal market-related provisions floated in the original version in November.

WASHINGTON — Local government defaults and bankruptcies could be higher this year than the historical norm, but are expected to remain rare, Moody’s ­Investors Service said in a report released yesterday.

WASHINGTON — The Senate on Monday agreed to limit debate on a $15 billion jobs bill that includes an expansion of the Build America Bond program and extensions of surface transportation funding. The motion for cloture was approved by a vote of 62 to 30 after 6:00 p.m.

The Internal Revenue Service’s attempt to provide answers to frequently asked questions about Build America Bonds led to even more questions last week, as bond attorneys worried that one of the answers appeared to ban any premium on BABs sold with “make-whole calls.”

A federal judge yesterday reluctantly approved the Securities and Exchange Commission’s $150 million settlement with Bank of America Corp., calling the agreement “better than nothing,” but “half-baked justice at best.”

WASHINGTON — The total budget hole for state and local governments in fiscal 2011 is “approaching $150 billion,” Mark Zandi, chief economist and co-founder of Moody’s Economy.com, said in an interview Thursday.

INDIAN WELLS, Calif. — The Internal Revenue Service plans to audit some Build America Bond issues to determine if they meet the tax requirement on issue price, an agency official said here last week.

WASHINGTON — The Treasury Department Friday announced allocations to states of $1.4 billion of qualified zone academy bonds for calendar year 2010.

INDIAN WELLS, Calif. — Bond attorneys raised concerns last week that a Securities and Exchange Commission proposal to expedite the filing of continuing disclosure event notices, coupled with the lack of a requirement to make materiality determinations for certain notices, could pose undue burdens on issuers.

At least one Build America Bond issuer has had a subsidy payment reduced because it owed money to the federal government, and this "offset" system is entirely automated, market participants warned here yesterday.

Issuer and investor groups are working together on a voluntary framework for improved disclosure of municipal swaps and financial information, a move they say reflects unprecedented cooperation between the two market groups, which historically have not been able to reach much consensus on the need for disclosure changes.

The Internal Revenue Service yesterday published two new information forms with accompanying instructions for issuers of Build America Bonds and recovery zone economic development bonds, one of which provides for direct deposit of payments from the federal government.

The Washington Senate Tuesday approved a bill that sponsors say will allow the state to move forward with plans for a toll-financed replacement of the Highway 520 floating bridge over Lake Washington.