Detroit’s bankruptcy hearing – Day 4

By Cate Long
October 28, 2013

In day four of Detroit’s bankruptcy eligibility hearing some big issues with both state and federal ramifications were addressed. It was the first time in American history that a sitting governor was called to testify in a Chapter 9 municipal bankruptcy case.

A new local pension calculus

By Cate Long
October 28, 2013

The team at The Center for State and Local Government Excellence has set a new standard in how local pension burdens should be reported in financial documents like CAFRs. The center’s new approach for measuring a municipality’s pension burden is to aggregate the direct cost of locally-administered pension plans (both city and taxpayers’ share of costs) and contributions to state teacher and non-teacher plans on behalf of dependent school districts. The aggregated cost is compared to a community’s revenues to understand how much must support pensions.

Detroit bankruptcy hearing – Day 2

By Cate Long
October 24, 2013

If you want to follow Detroit’s historic bankruptcy trial, Twitter is the way to do it. The court does not provide a video or audio feed, but there is a scrum of excellent local and national reporters tweeting throughout the day. Here are some of the best tweets:

Ratings competition is good for muniland

By Cate Long
October 24, 2013

Morningstar Ratings began when it purchased the respected independent rater Realpoint in 2010. Realpoint was only registered to rate structured finance products, and Morningstar has leveraged that authority to begin rating muniland.

Detroit’s embedded time bomb

By Cate Long
October 23, 2013

There are a lot of moving parts in the Detroit story as it goes through the largest municipal bankruptcy in U.S. history. The strangest part of the story has been the interest rate swaps that were layered onto the city’s 2005 and 2006 pension obligation bonds.

Should China build a muni market?

By Cate Long
October 22, 2013

Reuters reported on the possibility that China’s government will take the next step in building a municipal bond market. It seems that local governments in China have accumulated a lot of debt and it needs to moved off their books. From Reuters:

The debate over Rhode Island’s pensions

By Cate Long
October 18, 2013

Former SEC attorney Ted Siedle (currently formerly Putnam Investments’ compliance director), has issued a new investigative report that blasts Rhode Island Treasurer Gina Raimondo about her lack of transparency over the state’s pension investments. The report was commissioned by the Rhode Island chapter of the American Federation of State, County and Municipal Employees (AFSCME).

Decriminalize the marijuana business

By Cate Long
October 17, 2013

 

Slowly, the personal use of marijuana is becoming legal across America. The Council on State Governments reported:

Detroit’s forsaken leaders

By Cate Long
October 16, 2013

Being the emergency manager for bankrupt Detroit is no picnic. Coordinating the largest municipal bankruptcy in American history while simultaneously trying to restructure city operations, even with a posse of high-priced consultants, is a huge job. The current emergency manager, Kevyn Orr, wants to complete the bankruptcy and his term in 18 months. This is a recipe for inappropriate appointments, rich living and major mistakes.

Puerto Rico unveils a plan

By Cate Long
October 16, 2013

 

Puerto Rico’s top public officials held a two-hour conference call on Tuesday that was open to all investors. That may have been a first for the Commonwealth. Previous calls and conferences had been relatively restrictive in who was admitted. The yields on Puerto Rico’s debt have skyrocketed and the Commonwealth’s access into the public debt markets has been basically shut down. The open conference call was a good change of approach.