Audit

The Utah Inland Port Authority, which sold $150 million of bonds in December, asked the audit team to provide direction on potential risks.

Illinois headed into the new fiscal year with healthier metrics on multiple fronts but its last audit illustrates the long-term drag posed by the state's retirement burden.

Audit times for municipal bond issuers are on the rise, with the median reaching 164 days in 2020 compared with 147 in 2009.

The audit was brought on by the Internal Revenue Service in September 2021 in connection with Series 2013B bonds.

New York State Comptroller Thomas DiNapoli's audit chided the agency for not fully evaluating economic development initatives.

Two issuers, the San Diego County Regional Airport Authority and the Village of Franklin Park, Illinois, have disclosed in the past week that they’re under audit by the Internal Revenue Service.

Tax-exempt bonds are a very different area of the law.

Another correctional facility avoids a private business use tax penalty.

The IRS notified the city that its audit was closed with no change to the bonds' tax-exempt status, according to an EMMA notice posted this week.

Illinois' tardy fiscal 2020 financial statements offer a view of COVID-19's early impact on the state's finances.

The N.C. Local Government Commission approved Wake County's request to finance almost $600 million for school and community college projects and the state’s plan to issue $300 million of GARVEEs for DOT work.

Although many IRS audits of tax-exempt bonds are not reported on EMMA, the fact that only three have been reported almost halfway through the year highlights the recent drop in enforcement actions.

In Montana, two school districts and the state government reported that a new state law signed by the governor on May 6 will end the state tax deduction for certain school bonds after 2023 if those bonds are federally taxable.

The administrative shuffle also means that Edward Killen, who had been promoted to Acting Commissioner of TEGE, will return to the role of deputy.

Monday’s announcement came at the halfway mark of fiscal 2021 after only one other priority -- arbitrage violations -- had been announced since the Oct. 1 start of the federal fiscal year.

Other detention centers and prisons operating near the U.S.-Mexico border have undergone similar IRS audits the last couple of years in which issuers have agreed to convert their bonds from tax-exempt to taxable.

The public notice filed on EMMA is the first report by any issuer in calendar 2021 of any type of IRS audit communication.

The case is significant because so many municipal market participants rely on audited financial statements.

West Covina faces shrinking reserves and growing liabilities. Its mayor responds that it is working on solutions, but the pandemic challenges its efforts.

“This is a preliminary determination, not a proposed adverse determination or a final determination,” the county said.