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GFOA Newsletter
May 4, 2017
Technical Bylaw Changes to Be Voted on at Annual Business Meeting

The GFOA Executive Board will be proposing two technical changes to the GFOA bylaws at the annual business meeting in Denver, Colorado. The changes include a provision increasing the number of honorary memberships allowed each year from two to three. The other will permit electronic transmission and voting on bylaw changes. The annual business meeting will be held during GFOA's annual conference on Tuesday, May 23, 2017, at noon.  

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Association News
GFOA Releases Alert On Final IRS Issue Price Regulations Effective June 7

Establishing the issue price of a tax-exempt bond is important to issuers of tax-exempt debt as it: 1) determines the arbitrage yield restriction for rebate compliance purposes; and 2) determines the maximum allowable escrow yield for advance refunding bonds.

The new IRS issue price regulations are significantly different from prior regulations, which determined issue price by a reasonable expectation standard—established as the “first price at which a substantial amount of the bonds is reasonably expected to be sold to the public.” This new definition, applicable to all bonds sold on or after June 7, 2017, is the price at which bonds are actually sold to the public.

Ultimately, the documentation to accompany the debt issue, including underwriter certifications, notice of sale, and pricing wires, will be required to establish issue price and should be discussed with the issuer, the issuer’s municipal advisor, bond counsel, and the underwriter before the sale. Trade groups such as the Securities Industry and Financial Markets Association and National Association of Bond Lawyers have offered model documentation for consideration and use by their members. Some of these documents may not be favorable to issuers or certain types of bonds.

Issuers should be aware of the information contained in this GFOA alert when speaking with their financing team.

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Don’t Miss the Speaker Lineup at GFOA’s Annual Conference!

There’s still time to register for GFOA’s 111th Annual Conference, May 21-24, 2017, in Denver, Colorado! Discover new tools and technologies while networking with more than 4,500 of your peers already registered! Check out this year’s sessions and speakers.

Earn more than 20 CPE credits, with even more credits available for those participating in this year’s preconference seminars. If you have any questions about the Annual Conference, contact GFOA.

For those already registered for the conference, badges will begin to mail this week. Please bring your badge with you to check in at GFOA Registration in Lobby A of the Colorado Convention Center.

We look forward to seeing you soon!

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Remote Sales Tax Legislation Introduced in Congress

State and local governments still find themselves without the ability to enforce existing sales and use tax laws on remote online purchases, but two recently introduced bills would change that. On April 27, 2017, Kristi Noem (R-SD) introduced H.R. 2193, the Remote Transactions Parity Act of 2017, in the U.S. House of Representatives, and Mike Enzi (R-Wyo.), Dick Durbin (D-Ill.), Lamar Alexander (R-Tenn.), and Heidi Heitkamp (D-N.D.) introduced S. 976, the Marketplace Fairness Act of 2017 in the U.S. Senate. Both bills address GFOA’s policy priority regarding taxing remote and online sales by granting state and local governments the ability to enforce already existing sales tax laws. They are both unchanged from the versions introduced in the previous session.

Goodlatte introduced his own draft legislation in 2016, a proposal that remains outstanding. GFOA looks forward to working with the chairman to develop an equitable solution that works for state and local governments, which is outlined in S. 976 and H.R. 2193.

GFOA urges its members to contact their Senators and Representatives and ask them to cosponsor the Remote Transactions Parity Act and the Marketplace Fairness Act. (An original group of bipartisan group of original cosponsors is backing the H.R. 2193. The Senate bill also had a bipartisan group of original cosponsors.) GFOA’s MFA resource center is available to help you with your efforts. 


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Interested in Acquiring Hands-On, Practical Implementation of GFOA’s Best Practices in School Budgeting?

Register for GFOA’s in-person seminar on School Budgeting Best Practices, June 29-30, 2017, at the Renaissance Columbus Downtown in Columbus, Ohio. The training will provide participants with an opportunity to acquire hands-on, practical implementation of GFOA’s best practices in school budgeting. The program is structured around the new best practices in school budgeting, which include guidelines to develop a comprehensive budget process that fosters collaboration between academic and finance staff to develop strategic goals and allocate scarce resources accordingly.

The end goal of the new budget process focuses on aligning these scarce resources to focus on optimizing student achievement. In addition to the best practices, tools from GFOA’s Smarter School Spending website will be highlighted and used as examples for participants to better understand and apply to their own budgets.

Read more and register today! Earn 16 CPE credits with your participation. If you have any questions about the training, contact GFOA

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An Opportunity Not to Be Missed at GFOA’s 111th Annual Conference, May 21─24, in Denver, Colorado

Click here to view a list of this year’s sessions and speakers. Don’t miss GFOA’s preconference seminar, Alliance for Excellence in School Budgeting, on Friday, May 19, from 8:30 am to 4:30 p.m.

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Comments on SEC Amendments to 15c2-12 Due May 15

GFOA encourages its members to submit letters to the most recent proposed amendments to SEC Rule 15c-2-12. The rule requires bond dealers to review issuers’ official statements before underwriting municipal bonds and to reasonably determine that the issuer has contracted to disclose annual financial and operating information, as well as material event notices, on the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access website. The proposed amendments would add to the list of event notices to be included in continuing disclosure undertakings.

Specifically, the amendments require that information be provided about: 1) the incurrence and terms of bank loans; direct purchases of securities by banks and other non-publicly offered debt; leases; guarantees; derivative instruments; and monetary obligations resulting from judicial, administrative, and arbitration proceedings; and 2) the occurrence of defaults, acceleration, and termination events; and modifications of terms or other similar events with respect to such debt.

Although GFOA’s Federal Liaison Center will not likely submit final comments to the SEC until the deadline, GFOA has expressed serious concerns about the broad scope and potential unintended consequences of the proposed amendments. Please feel free to contact Emily Brock, director of GFOA's Federal Liaison Center, with any questions. 

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Put Your Government on the Cutting Edge of Financial Sustainability

GFOA’s recent research into what it takes for a local government to be truly financially sustainable has uncovered six leadership strategies and eight organizational design principles that lead governments to ongoing financial health. We have also developed a self-assessment technique that will allow local governments to determine the extent to which they exhibit these leadership strategies and institutional design principles.

Now, GFOA is looking for local governments that would like to join with other forward-thinking local government leaders in pilot testing this self-assessment tool at an invitation-only special session at GFOA’s annual conference, May 21-24 in Denver, Colorado, to introduce the financial sustainability framework and the tool. We’ll also discuss what would be involved in participating in the pilot.

If you’re interested in participating in this session—or if you can’t make the annual conference but would like to consider joining the pilot—please e-mail Shayne Kavanagh.
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New CPFOs Announced

The following individuals earned the Certified Public Finance Officer (CPFO) designation in spring 2017: Vanessa Burke, Folsom, CA; Russell Cline, Financial Manager, Florida Department of Revenue; Frank Costa, Accountant Auditor III, Shasta County, CA, Auditor-Controller’s Office; Carrie Curry, Staff Accountant, Town of Leesburg, VA; Bonny Lynn, CFO, Coconino County, AZ; DeAnne Norton, Budget Manager, Confederated Tribes of Grand Ronde, OR; Alan Rae, Director of Finance, Herriman City, UT; Robert Schiwitz, Administrative Services Manager, Lakeside Fire Protection District, CA; Thomas Shepard, Manager – Accounting, Texas County & District Retirement System; Amanda Woodin, Assistant Director for Finance & Administration, Kalamazoo/Battle Creek International Airport (Kalamazoo County); and Karen Van Winkle, Director of Finance, Blue Springs, MO.

There are now 688 people who have attained the CPFO designation.

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News Links
Municipal Bond Insurance after the Financial Crisis

Although the municipal bond insurance industry shrank markedly between 2007 and 2012, it has rebounded in recent years. Municipal bond issuers, their financial advisors, and investment bankers continue to grapple with the question of whether purchasing municipal bond insurance is worthwhile. Mercatus explored the issue and advises issuers to be extremely cautious in purchasing municipal bond insurance.

Generally, their analysis finds that bond insurance is not a good deal for local governments if the insurer’s credit rating is lower, the cost of borrowing increases. Local governments cannot conclude with scientific certainty that bond insurance has any effect on interest rates, and loss of time for staff members in preparing bond insurance applications and providing information to bond insurers is likely to be non-negligible, according to the research paper.

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Six Phrases to Help Motivate Your Employees

Many managers look for ways to improve team morale. One way is to use “team-building phrases,” according to the Career Advancement Blog. The following six phrases can help you build strong working relationships with your employees and bolster their effectiveness.

  • “What can we achieve?” This question will help team members develop a common vision for a project.
  • “What can I do better?” This important question makes it feel safer for employees to share their input.
  • “Thank you.” Say exactly what you’re thankful for, in a moment when you can focus your full attention on sharing your appreciation.
  • “What’s your opinion?” All employees want to feel that their opinions are valued, and asking this question also brings a greater diversity of ideas to the table.
  • “I need your help.” Issuing demands feels dismissive, but making a request shows employees that they are valued and needed.
  • “What drives you?” Knowing what your employees are passionate about helps you delegate work appropriately, giving employees the chance to do more of what fuels them.
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Editor: Marcy Boggs  |  Executive Director/CEO: Jeffrey Esser

The GFOA Newsletter (ISSN 1051-6964) is published weekly by
the Government Finance Officers Association of the United States and Canada.
Correspondence regarding editorial and/or business matters should be sent to
GFOA, 203 N. LaSalle St., Suite 2700, Chicago, IL 60601-1210. Phone - 312/977-9700 FAX - 312/977-4806.


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