The Rising Stars give their opinions on the chief issue facing the muni market over the next five years at our recent California Public Finance Conference.

VOICE OVER 1: From a credit perspective, I would say that keeping up with public pension plan and retiree healthcare funding is going to continue be an area of focus for the municipal market.

VOICE OVER 2: I think the chief issue that we're all going to face is really just continuing to navigate the changing regulatory environment. There were some really great panel discussions yesterday about MCDC and what's coming next for the regulators, so I really just think it's an area that's going to continue to impact all sides of business.

VOICE OVER 3: Closing the infrastructure funding gap. A number of issuers have a lot of desire to require projects that they'd like to fund and they need to balance between funding those and maintaining a respectable credit profile. Quite often, whether it's a school district needing to fund or replace outdated classrooms, or it's a transportation agency that needs to fund infrastructure, quite often those private requirements exceed the amount of their debt capacity.

VOICE OVER 4: The ability to attract young talent into the business. With tech exploding and generally strong job growth, it's been very hard to recruit young, specially analytical folks into the business.

VOICE OVER 5: Transportation is going to be one of our biggest issues. I feel that the gas tax as being a primary funding source is just not going to work. As fuel efficiency has gotten better and gas is becoming less reliable of a source, we need to think of other ways to fund transportation.

VOICE OVER 6: Disclosure and transparency. I think as the younger, millennial generations rise they crave a lot of information and fresh information. Investors have been pushing to get better disclosure and more timely disclosure. I know that a lot of the issuers don't necessarily have a platform, or have staffing to provide that ongoing and continuing disclosure.

VOICE OVER 7: A key challenge that I see is significant, capital plans and a back log of infrastructure needs for a lot of our clients.

VOICE OVER 8: Bankruptcies propose a big risk for the work that we do. Specifically, I think that increased state oversight of distressed credits will be helpful to avoid that. Such as, a strong framework in New Jersey which makes bankruptcies less likely.

VOICE OVER 9: At the end of the day, if there's a change in law that affects the tax exemption of bonds, that could be catastrophic. Especially for those smaller issuers who try to tap the market through the issuance of tax exempt.

VOICE OVER 10: They have a revenue constraint. That revenue can come from cutting or increased revenue. I don't really have a stake in that argument. But I do have a stake in the infrastructure side. And really, through lack of that revenue, available revenue to fund infrastructure, I think in turn will have the biggest effect on the mini market. It does now, it has for a long period of time and it will into the future.

VOICE OVER 11: Slow economic growth. Eight years following the recession we have not seen economic growth rates recovered to the levels we had seen following previous downturns. A highlight, states, for example, with states we've seen for many that state revenues have been under performing forecasts. Coupled with rising fixed costs, this can tip a state into imbalance.

VOICE OVER 12: The pension issues and pension costs will be the chief issue in five years and so I'm concerned about that especially because, in recent years, even though theoretically we're coming out of the economic recession, we've seen a lot of revenue constraints and I guess a limited growth in revenues. So, I'm concerned about that. While revenues remain stagnant and pension costs rise that necessary expenditures will get crowded out.

VOICE OVER 13: The use of debt restructuring and the increasing use, or potential use, or speaking about debt restructuring as a way to either revise, manage labor contracts or to revise debt structures.

VOICE OVER 14: Pensions fund with liabilities. So, right now if people are relying on what's unrefunded portion of it. You look at states like New Jersey, Connecticut, even Kentucky The unfunded portion of it is massive. It's more than half and that's what you get when you look at the environment we're in today. The low interest environment is what's causing this issue.