Law and regulation

WHO: Jay Goldstone is the incoming chairman of the Municipal Securities Rulemaking Board.

Incoming MSRB chair Jay Goldstone plans to urge the board to review the effectiveness of muni rules and standardize cost-benefit analyses.

Rep. Jeb Hensarling, a Texas Republican with ties to Lone Star state muni-bond dealers and other financial firms, is most likely to become the next chairman of the House Financial Services Committee in January, according to lobbyists and market sources.

The Securities and Exchange Commission's recently issued report on the municipal securities market should serve as a "starting point for comprehensive dialogue" with Congress and market participants on improving fairness and efficiency of the market," SEC Commissioner Daniel M. Gallagher said last week.

The SEC approved rule changes that will restrict underwriters from using the phrase "not reoffered," or "NRO," in written communications.

Municipal market participants are irked that the Securities and Exchange Commission has further delayed temporary registration rules for municipal advisors, saying the lack of a final MA definition has allowed market abuses to continue unchecked for years.

WASHINGTON — The Securities and Exchange Commission has extended for one year its temporary registration rules for municipal advisors, the second extension since the SEC issued the temporary rule late 2010.

The National Federation of Municipal Analysts has updated its disclosure best-practices paper for issuers of hospital debt in response to market changes spurred by the financial crisis.

Gary Goldsholle, vice president and association general counsel at the Financial Industry Regulatory Authority, has been named general counsel at the Municipal Securities Rulemaking Board and will join the board in late October.

The House of Representatives passed a bill late Wednesday that would narrow the definition of municipal advisor and exempt a number of market participants from being subject to MA registration and other rules.

Public interest and other groups scrambled to send letters to lawmakers opposing a municipal advisor bill they fear will roll back critical components of the Dodd-Frank Act.

Municipal analysts and other muni market participants are urging the Municipal Securities Rulemaking Board to strengthen a proposal to tighten bond-ballot campaign contribution reporting requirements for dealers.

Fewer than 10% of general-obligation bond issuers filed annual audited financial reports within the Municipal Securities Rulemaking Board's recommended 120-day period in 2011, according to a report from muni research firm Merritt Research Services LLC.

The Municipal Securities Rulemaking Board launched a series of free online training videos Thursday to help dealers and issuers submit primary- and secondary-market disclosures to the board's EMMA system.

Government officials are on a path to regulating municipal advisors, but real reform won't come until issuers demand higher standards from their advisors, a market observer is warning.

The House Financial Services Committee passed a municipal advisor bill Wednesday after striking a requirement that MAs have written agreements with issuers, one of the bill's most contentious provisions.

While dealers are pushing for a House committee to approve a pending municipal advisor bill, non-dealer advisors oppose the bill, claiming it contains too many loopholes that would allow firms to engage in advisory activities without being regulated.

State treasurers voted Monday to urge Moody's Investors Service to carefully consider the consequences of its proposed changes to analyzing public-sector pension data, warning it will muddy already complicated pension issues for the public and financial markets.

The Municipal Securities Rulemaking Board has expanded its online guide for municipal bond issuers with new resources, including "EMMA Trade Monitor," a service that allows issuers to download secondary-market trade data to desktop computers.

A pending municipal advisor bill that has been amended to more precisely define the term and to leave a statutorily-mandated federal fiduciary duty in place, could be voted on by the a House committee as early as next week, according to sources.