WASHINGTON — The Treasury Department announced Tuesday that it is resuming sales of State and Local Government Series securities.
The sales will start at noon on Tuesday, the department said in a release.
The sales of SLGS had been suspended since Dec. 28 — an extraordinary measure the Treasury took to help avoid the federal government from hitting its $16.4 trillion statutory borrowing limit at the end of the year.
About $4 billion to $17 billion of SLGS are issued each month and halting sales avoided new issuances of debt that were counted against the debt limit.
President Obama signed legislation on Monday temporarily suspending the debt limit, allowing the Treasury's Bureau of the Public Debt to accept subscriptions for new issues of SLGS securities.
The SLGS program began in 1972 to assist state and local government entities in complying with the Internal Revenue Service arbitrage regulations. Muni issuers buy SLGS for advance refunding escrows to ensure they no not generate illegal arbitrage.
