The Wall Street Journal reports today that the incoming Obama Administration is proposing to coordinate efforts of the Federal Reserve Board and the Treasury Department so as to provide a funding backstop for the municipal-bond market. The resulting program would be similar to that set up for the commercial-paper market to help ease financing conditions for companies in need of short-term funds.
As long-time readers of this blog will recall, municipal governments across the nation have been struggling to float new bond issues in the wake of the credit crisis, "raising the cost of day-to-day operations, threatening longer-term projects and dampening a major source of jobs and stability." The proposed action would serve to strengthen the municipal bond market and make it easier for cities and villages to secure funding.
The City of Columbia successfully offered a bond issue early last fall, just before the debacle in securities chilled the bond market; the proceeds were used to purchase the landmark Miller-Fiege Home and an additional building that will eventually become part of the City Hall campus.
No comments:
Post a Comment