Bankruptcy

WASHINGTON - A House subcommittee chairman, five state and local groups, and a Florida official are urging the Treasury Department and Federal Reserve to modify their commercial paper and troubled asset purchasing programs to include state and local governments, which are struggling under the current the credit crisis.

SAN FRANCISCO - California successfully issued $5 billion of notes this week in the midst of the deepest financial crisis since the Great Depression. The state's local governments issued a big sigh of relief.

WASHINGTON - Maryland Gov. Martin O'Malley yesterday announced more than $345 million in cuts to balance the state's fiscal 2009 budget, joining Virginia, Rhode Island, and many other states forced to continually rein in spending as their tax revenues plummet during the financial crisis confronting the nation.

BRADENTON, Fla. - Analysts say Jefferson County, Ala.'s proposed sewer debt restructuring plan faces numerous challenges, including a dysfunctional bond market and skeptical investors who may demand interest rates that make a deal unworkable.

WASHINGTON - The Senate Agriculture Committee chairman said yesterday that he plans to soon introduce legislation that would authorize and require the federal government to regulate derivatives.

WASHINGTON - Federal Reserve officials said Monday that currently there are no plans for their Commercial Paper Funding Facility to accept tax-exempt commercial paper, but that the Fed may reconsider this issue before the program starts Oct. 27.

BRADENTON, Fla. - The Jefferson County, Ala., Commission yesterday voted 3 to 2 against filing for bankruptcy.

CHICAGO - When General Motors Corp. last week lobbied Detroit's two pension funds to invest in its prominent downtown headquarters to help raise $500 million, some saw it as an illustration of the severity of the fiscal pressures facing the U.S. auto industry.

The Municipal Securities Rulemaking Board announced yesterday that it has tapped Janet Eakes, a former Freddie Mac senior vice president, for its newly created post of chief operating officer, and John Doyle, a principal in the municipal securities division of UBS Securities LLC, as director of project management.

CHICAGO - A Wright County, Minn., judge last week dismissed a lawsuit filed by Bridgewater Telephone Co. against the city of Monticello that argued its $26.4 million bond issue to fund the installation of a fiber-optic broadband communications network violated state law.

SAN FRANCISCO - With the deal slated to go before retail investors Tuesday, details remain scarce on the structure of California's planned $4 billion revenue anticipation note offering.

Three European governments yesterday agreed to take further measures to support Franco-Beligan bank Dexia SA, a top provider of credit enhancement in the U.S. municipal market and parent of bond insurer Financial Security Assurance Inc.

Outflows have continued to slow and more new cash has begun to find its way back to tax-exempt money market funds over the last week.

WASHINGTON - Municipal issuers are pushing to be included in the Federal Reserve's program to buy commercial paper, which the Fed has hinted will not include municipalities under its current terms. The resolution may ultimately boil down to the definition of a municipality, market participants contend.

BRADENTON, Fla. - In a tersely worded statement yesterday, Jefferson County Commission President Bettye Fine Collins criticized local legislators who oppose the plan negotiated by Alabama Gov. Bob Riley and the New York Insurance Department that would absolve the county of $1 billion of sewer debt and avoid filing the largest municipal bankruptcy in U.S. history

WASHINGTON - Michael F. Imhoff, a managing director at Stifel, Nicolaus & Co. in Denver, and Alan Murphy, senior vice president at Duncan-Williams Inc. in Memphis, have joined the Municipal Securities Rulemaking Board, the MSRB announced yesterday.

SAN FRANCISCO - California has issued a preliminary official statement for a $4 billion revenue anticipation note issue that it plans to price next week, amid continuing concerns over the market's ability to absorb such a deal during the ongoing credit crunch.

BRADENTON, Fla. - Behind the scenes for the past few weeks, officials at the New York Insurance Department intervened at the request of Alabama Gov. Bob Riley in the negotiations aimed at preventing Jefferson County from filing the largest municipal bankruptcy ever in the U.S.

Banc of America Securities LLC, Banc of America Investment Services Inc., and RBC Capital Markets Corp. have agreed to buy back at par a total of almost $5.6 billion of auction-rate securities from retail investors under preliminary settlements reached with federal and state regulators over charges they engaged in abusive ARS sales practices.

WASHINGTON - Connecticut Attorney General Richard Blumenthal has filed motions to remand back to state court the lawsuits he filed this summer against the three major credit rating agencies.