Rematch Set for House Seat

Keith S. Fimian won Tuesday’s Republican primary for the U.S. House seat in Virginia’s 11th congressional district, setting up a rematch in November’s general election against freshman Democrat Gerald Connolly, who has been an advocate for the municipal bond market during his time in Washington.

Connolly defeated Fimian in 2008 with 53% of the votes for the open seat.

In March 2009, Connolly sponsored the Federal Municipal Bond Market Support and Securitization Act, which would require the Treasury Department and the Federal Reserve to provide support for municipal bonds, including possible purchases of munis.

Momentum for the bill and for federal municipal support has stalled following the success of Build America Bonds, which started to be issued in April 2009.

But at the time Connolly’s legislation was filed, the municipal-to-Treasury yield ratio was inverted. A 10-year triple-A muni had an average yield of 3.27% in March 2009 compared to a 2.81% average yield for a 10-year Treasury, according to Municipal Market Data.

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