Washington

WASHINGTON — The American Bar Association’s section on taxation has asked the Treasury Department to clarify a number of points in tax-regulatory guidance of Build America Bonds and other new programs under the ­American Recovery and Reinvestment Act to ensure issuers don’t do ­anything when issuing the bonds or ­spending the proceeds that could jeopardize the federal subsidy on the bonds.

WASHINGTON — Tax revenues continued to fall in the July-to-September quarter of 2009 — the fourth consecutive quarter of decline — for all 44 states that reported their third-quarter results to the Rockefeller Institute of Government, according to its preliminary report released yesterday. Surprising revelations in the report include California’s relatively moderate year-over-year declines.

WASHINGTON — Market participants are increasingly concerned about provisions in Senate and House regulatory reform bills that are designed to address the level of sophistication of states and localities that want to engage in over-the-counter derivatives transactions.

Build America Bonds have been called the success story of 2009 as issuers rush to take advantage of the 35% interest payment subsidy offered by the federal government. Yet few are flocking to an even better offer — recovery zone economic development bonds, which offer certain issuers a 45% subsidy.

WASHINGTON — The Treasury Department this week allocated $29.1 billion to state and local housing finance agencies for temporary new-issue bond purchase and liquidity programs, but some small HFAs are warning the fees they would have to pay to participate in the purchase program are prohibitively expensive.

SAN FRANCISCO — Washington’s official economic forecaster sliced $760 million from the state’s revenue outlook yesterday, citing a “revenue-less recovery.”

WASHINGTON — Senate transportation leaders are in a standoff with their House counterparts over a six-month extension of the current transportation law, as states are experiencing a 30% reduction in their federal highway and bridge funding.

WASHINGTON — State securities regulators reached settlements in principle with Wells Fargo & Co. under which the firm will pay $1.9 million in penalties and buy back about $1.4 billion of illiquid auction-rate securities primarily held by its subsidiaries’ retail customers since early 2008 when the ARS market collapsed.

The Indian Wells, Calif., Redevelopment Agency disclosed late Tuesday that the Internal Revenue Service has initiated an audit of $68 million of tax-allocation bonds it competitively sold in 2006.

The Municipal Securities Rulemaking Board yesterday filed proposed rule changes with the Securities and Exchange Commission that would dictate the priority of retail and other customer orders in primary offerings, as well as dealers’ related record-keeping responsibilities.

WASHINGTON — The Obama administration yesterday announced the formation of a multi-agency task force that will investigate and prosecute “significant” financial crimes and civil violations tied to the financial crisis and the government’s economic recovery programs.

WASHINGTON — Lawmakers are pushing for a second economic stimulus bill, and transportation advocates hope it will contain funding for infrastructure without further delaying a multi-year surface transportation reauthorization bill.

The Securities and Exchange Commission has six “significant deficiencies” that prevented it from having effective internal controls over its financial reporting as of Sept. 30, 2009, the Government Accountability Office warned in an audit released this week.

WASHINGTON — State and local housing finance agency officials generally applauded the allocations they received from the Treasury Department for the new-issue bond purchase and temporary credit and liquidity programs, saying they were close to what they requested and should boost ailing housing programs.

The Financial Industry Regulatory Authority censured and fined four firms a total of $175,500 for municipal and other rule violations, including $55,000 against Morgan Stanley for failing to report municipal and corporate securities transactions in a timely manner.

The Municipal Securities Rulemaking Board would have more leeway to select members on a 15-member majority-public board under a revised draft of financial regulatory reform legislation released yesterday by the Senate Banking Committee.

WASHINGTON — Brazos Student Finance Corp. wants to be the first student loan lender to ask institutional investors to voluntarily tender, at a discount, illiquid auction-rate securities in exchange for new floating-rate notes, about a year after a much larger and more complex offer failed.

WASHINGTON — The U.S. Department of Energy is asking governments and development finance authorities to participate in the first stage of a new federal loan guarantee program for alternative energy projects, which is expected to be used in conjunction with municipal bonds and will guarantee at least $50 billion of debt.

State, regional, and local transportation toll authorities will steadily issue debt as the economy recovers in order to pay for infrastructure maintenance and construction projects that cannot be funded from state and federal coffers, Moody’s Investors Service predicted in a report issued late last week.

WASHINGTON — The Securities and Exchange Commission will likely vote to adopt final changes to its Rule 15c2-12 on disclosure “very early” next year and will then meet with lawmakers to see what can be done to expand its authority over the muni market, SEC chairman Mary Schapiro said this week.