COZEN O'CONNOR PUBLIC FINANCE ALERT
MSRB Notice Regarding Tax Credit Bonds (including BABs)
Dated: April 24, 2009
Today the Municipal Securities Rulemaking Board released Notice 2009-15 entitled "Build America Bonds and Other Tax Credit Bonds". See: www.msrb.org/msrb1/whatsnew/2009-15.asp. The notice clarifies that Build America Bonds (BABs) and the other types of bonds authorized under the American Recovery and Reinvestment Act of 2009 are municipal securities subject to all of the MSRB rules. The only exception is that the MSRB expresses no opinion about whether the tax credit component of BABs or other tax credit bonds are subject to its rules.
Dealers are therefore subject to all the MSRB requirements for these bonds, including submitting official statements under Rule G-36 and delivering official statements to customers under Rule G-32. The MSRB specifically reminds dealers who are selling BABs through their taxable desks that Rule G-27 requires that municipal securities principals must supervise all municipal securities activities, including such sales.