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    Entries in Utah (3)

    Monday
    Dec122016

    To Prepare for the Next Recession, States Take Stress Tests

    No government can be fully prepared for every economic twist and turn. Still, some are trying.
    BY  DECEMBER 12, 2016

    The Great Recession was uniquely devastating for states and localities because it hit all three major tax revenue sources: income, sales and property. It was a scenario that few, if any governments, were really prepared to absorb. As a result, governments were forced to make massive budget cuts.

    Now, as the recovery trudges on longer than most, a growing number of states are making sure they aren’t blindsided by the next downturn.

    Enter stress testing. The idea, which was borrowed from the U.S. Federal Reserve, essentially throws different economic scenarios at a state budget to see how revenues would be impacted.

    “We’re in an environment where everyone is starting to think about the next downturn and what that’s going to look like,” said Emily Raimes, a Moody’s Investors Service analyst. “A stress test is a tool for states to think about what types of programs they should commit to and how much to save now.”

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    Friday
    Jul222016

    The Week in Public Finance: Hot Munis, Cooling Off Creditors and Warming Up to Facebook

    A roundup of money (and other) news governments can use.
    BY  JULY 22, 2016

    It’s July and Muni Bonds Are Hot

    The municipal bond market could be off to its best start since 2010, when federal policies helped fuel new issuance. During the first six months of this year, a total of $221 billion in bonds have been brought to market by state and local governments, according to data from the Securities Industry and Financial Markets Association (SIFMA). The total includes new bonds and refinanced ones.

    Most of that activity has come from the second quarter of the year, specifically in May and June when the volume of new bonds in each month was the highest since 2008, according to an analysis by RBC Capital Markets’ Chris Mauro. Even Puerto Rico’s recent default on a $2 billion debt payment has not appeared to phase investors or hurt interest rates.

    The market is currently on pace to finish the year with over $430 billion in issuance. But with more than five months to go before the end of the year, anything could happen -- particularly with a volatile presidential contest underway. Last year, the pace cooled in the second half of the year, with the value of total bonds issued finishing just shy of $400 billion. Still, Mauro said he is increasing his original prediction of new bond volume to somewhere between $400 billion and $425 billion.

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    Friday
    Feb262016

    The Week in Public Finance: States Dare Online Retailers to Sue, a Local Government Shutdown Threat and More

    A roundup of money (and other) news governments can use.
    BY  FEBRUARY 26, 2016

    Don't Like It? Sue Me

    Tired of waiting for Congress to approve a tax on Internet sales, more than a dozen states -- including Alabama, South Dakota and Utah -- are moving to pass bills or change regulations in ways that deliberately invite lawsuits from Internet retailers. The goal? Landing the issue before the U.S. Supreme Court.

    Alabama, for its part, will start enforcing an old law it says allows it to tax out-of-state sellers. The state will audit companies that don’t file returns.

    “We’re confident that some remote sellers will not comply and therefore it will lead to litigation,” Alabama Deputy Revenue Commissioner Joe Garrett told The Wall Street Journal. “We have been very open about what we’re doing.”

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