Best of muniland on Twitter

Here are the best tweets with the #muniland hashtag for June 26, 2014:



America’s unstable road funding

Congress General Fund

The national account to fund America’s highway construction and other transportation is nearly empty. The revenues that go into the Highway Trust Fund, which come from a federal 18.4 cent per gallon tax on gasoline, are expected to dip below $4 billion in July. Congress has transferred monies from the general fund in four of the past five years (the yellow stars above) into the Highway Trust to make up for the shortfall from the fuel tax.

In anticipation of the fund’s drawdown, Transportation Secretary Anthony Foxx alerted said that the federal Department of Transportation would go into “cash management,” possibly delaying payments for state road projects.

Several members of Congress have sponsored legislation to prop up the HTF, including Senate Finance Committee Chairman Ron Wyden, who offered a $9 billion patch to tide the fund over to the end of this December without drawing money from the federal budget. Wyden’s proposal relies on a mix of five revenue sources. From Rollcall:

Best of muniland on Twitter

Here are the best tweets with the #muniland hashtag for June 25, 2014:


Best of muniland on Twitter

Here are the best tweets with the #muniland hashtag for June 24, 2014:


A revolution in muniland

Goldman Sachs

In a speech last week at the Economic Club of New York, SEC Chairman Mary Jo White set out three new initiatives that will reorder the way fixed income markets serve retail investors.

Congress gave the SEC the authority to regulate fixed income markets in 1975. The initiatives that White announced make up the first broad extension of the SEC’s authority over the murky, cost ridden, over-the-counter bond market. The combined firepower of the SEC, FINRA and the MSRB will likely topple any resistance that dealers will use to protect one of the last remaining profit centers.

In her speech, White pointed out that securities markets operate within a “structure” of regulator rules, technology and market practices. Bond trading information for retail-size trades is often locked in trading venues and available only to select market participants. Transparency for investors is mostly an illusion. White said:

Best of muniland on Twitter

Here are the best tweets with the #muniland hashtag for June 23, 2014.


Starbucks tuition reimbursement expected to boost revenue for ASU

Moody's Financial Ratio Analysis

Starbucks recently announced that it will make it possible for thousands of its part- and full-time U.S. employees to complete a college degree online at Arizona State University. Starbucks says that this is a unique collaboration that allows employees to finish their bachelor’s degrees with full tuition reimbursement. ASU has a successful online education program.

Starbucks wrote glowingly about ASU:

It is ranked the second most innovative school in the country by U.S. News & World Report and ranks 5th in the nation in producing the best-qualified graduates, according to a Wall Street Journal survey of campus recruiters. Today, almost half of college students in the U.S. drop out before finishing a bachelor’s degree while nearly half of all ASU Online students graduate in under three years.

Moody’s writes about the tuition deal with ASU, which is rates Aa3 (8.5):

Starbucks Corporation is rated A3 [7] stable with brand strength as a key credit factor and has approximately 135,000 employees across the United States.

Best of muniland on Twitter

Here are the best tweets with the #muniland hashtag for June 20, 2014:


Puerto Rico’s electricity monopoly is in a downward spiral

Puerto Rico’s faltering electricity monopoly PREPA received another blow this week when Standard & Poor’s downgraded the public corporation’s $8.8 billion of revenue debt to BBB- (5.5) from BBB (6) and placed the rating on CreditWatch with negative implications. This leaves PREPA one small step from junk grade in the three major raters.



Quality Fitch BB

– 4.5 – Moody’s Ba2

– 4.5 – Standard & Poor’s BBB-

– 5.5 –

In August 2013, PREPA issued $673 million of Power Revenue bonds, which recently traded with a 10 percent yield for maturities due 07/01/2040 (Cusip 74526QA85 shown below). This clearly signals that the market believes these bonds are speculative grade. Standard & Poor’s low investment grade rating of BBB- is lagging the market’s view and is two notches higher than the other major raters.


PREPA’s severe cash problems first surfaced when it was reported that the electricity monopoly had transferred $100 million from a capital construction fund to pay Venezuela’s state-run company Petrobras for oil to run its electricity generators. Caribbean Business reported:

Best of muniland on Twitter

Here are the best tweets with the #muniland hashtag for June 19, 2014:


  • # Editors & Key Contributors