Law and legal issues

WASHINGTON - A Texas lawmaker has once again introduced legislation that would allow the North American Development Bank to guarantee tax-exempt bonds.

ORLANDO - To save costs, a number of underwriters are choosing to forgo having their counsel write so-called 10b-5 letters that certify there are no material omissions or misleading statements in the issuer's official statement for its municipal bonds. Instead, the underwriters are relying on such letters written by an issuer's disclosure counsel, bond lawyers meeting here said last week.

WASHINGTON - The Securities and Exchange Commission plans to hold a roundtable on April 15 to discuss its oversight of credit rating agencies, including its proposed rules on conflicts of interest, competition, and transparency.

ORLANDO - The Securities and Exchange Commission's municipal securities chief urged bond attorneys meeting here yesterday to disclose more information about the underlying borrower in certain conduit deals that are sold with short-term interest rates.

ORLANDO - The Treasury Department is hoping to release guidance within the next 30 days on how the direct payment option of the Build America Bonds program will work, as well as the amount of tax-credit bonds that each state will be able to issue under the economic stimulus law, a department official told attorneys meeting here yesterday.

WASHINGTON - The House Financial Services Committee will hold a hearing March 20 to promote aggressive federal and state investigations of financial fraud and other abuses, including auction-rate securities, the panel's chairman said yesterday.

CHICAGO - The fate of a $300 million bond-financed plan to expand Detroit's convention center - one of the city's chief economic assets - appears headed for court.

CHICAGO - Months after narrowly avoiding its first default, the Cleveland-Cuyahoga County Port Authority is faced with another delinquent bond-fund borrower that has warned it would likely have a tough time making its full monthly debt payments this year due to the weak economy.

WASHINGTON - Standard & Poor's issued a white paper yesterday that embraced increased global oversight of rating agencies, including rules that require "robust" disclosure of rating criteria and methodologies and that address potential conflicts of interest in the ratings process.

WASHINGTON - The Municipal Securities Rulemaking Board this week called for the Treasury Department to extend the termination date for its $50 billion temporary guarantee program for money market mutual funds to Sept. 18 from April 30.

WASHINGTON - More than a year after the auction-rate securities market collapsed, some $78 billion of illiquid municipal ARS remain outstanding, but a growing number of bond attorneys are pushing to use a new type of taxable bond program recently authorized by Congress to refund some of those securities.

BRADENTON, Fla. - Two Florida lawmakers have filed bills that would require water management districts to get voter approval through referendums before selling certificates of participation.

CHICAGO - Michigan Gov. Jennifer Granholm has declared the city of Pontiac to be in a state of fiscal emergency and will likely appoint a manager to take over its finances after a hearing scheduled for next week.

BRADENTON, Fla. - A federal judge has scheduled a full hearing for March 24 on a motion by bond insurers and a bank trustee to appoint a receiver to oversee Jefferson County, Ala.,'s debt-ridden sewer system.

SACRAMENTO - Imagine a state with a logical system of government in which balanced budgets are adopted on time and leaders tackle difficult issues.

A Securities and Exchange Commission administrative law judge has ordered former investment adviser Kent D. Nelson barred from the securities markets after he pleaded guilty to a felony in connection with a pay-to-play scheme involving the New Mexico treasurer's office.

SAN FRANCISCO - California dealt with its short-term budget crisis last week, but its long-term fiscal imbalance continues to grow, according to a new report from Controller John Chiang.

WASHINGTON - Senate Banking Committee chairman Christopher Dodd yesterday strongly urged Federal Reserve Board chairman Ben Bernanke and Treasury officials to meet with lawmakers to work out a plan to include the municipal market in the Fed's lending programs.

The House today will take up a $410 billion fiscal 2009 omnibus spending package that includes $40.7 billion for transportation infrastructure and $41.5 billion for the Department of Housing and Urban Development. The time for passage is tight: on March 6 a continuing resolution that has kept federal agencies in operation since the fiscal year began on Oct. 1 will expire.

SACRAMENTO - The U.S. Ninth Circuit Bankruptcy Appellate Panel wants to take a closer look at a lower court decision to accept testimony by a city accountant who helped convince the lower court that Vallejo, Calif., is bankrupt.