A lawmaker has filed a bill in the New York State Assembly to try out open bidding for local municipal bonds.
Assemblywoman Amy Paulin, D-Scarsdale, filed the "Electronic Bond Sale Pilot Program" bill on December 19. Paulin is a Democrat who represents New York City suburbs in Westchester County.
The bill would set up a pilot program for the state's counties, cities, towns, villages and school districts bringing bonds to the market, allowing electronic bids to be submitted for both closed and open auctions.
Bids now are submitted only in closed auctions, where the bidder does not know what others have bid until the end of the bidding process. In open auctions bidders would learn the ranking of their bids prior to the bidding period's conclusion and could change their bid accordingly.
The program would require the municipal governments to submit evaluations each year as to whether the electronic bid process increased the number of bidders and whether it changed the prices of the bonds. The state comptroller is to gather these evaluations and submit a report to the legislature annually.
The bill has been referred to the Assembly Committee on Local Governments.