Fourteen municipal market groups are urging the Securities and Exchange Commission to refrain from requiring money market funds’ net-asset values to float, warning such a change would hurt state and local governments and money market funds.

“The fixed NAV is the fundamental feature of money market funds,” the groups said in a two-page letter to SEC chairman Mary Schapiro. Funds currently maintain a stable $1.00 per-share value. “Forcing funds to float their value likely would eliminate the market for these products by forcing many investors, including state and local governments, to divest their [money market mutual fund] holdings, and discouraging others from using these funds,” the muni groups said.

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