1. October 25, 2018 Charleston, South Carolina
Washington Report
October 25, 2018
Charleston, South Carolina
Dee P. Wisor President NABL
Jessica R. Giroux Director of Governmental Affairs NABL

2. About NABL
The National Association of Bond Lawyers (NABL) was established to promote the importance and integrity of the municipal market by advancing the understanding of and compliance with the law affecting public finance.
NABL provides its members with a forum for the exchange of ideas as to law and practice, giving its members some of the tools that help them continually improve the state of the art in the field.
NABL also provides commentary and recommendations at the federal, state and local levels with respect to legislation, regulations and rulings affecting bonds, and on occasion submits friend of the court briefs or memoranda in connection with court or administrative proceedings.

3. NABL works closely with industry participants
Industry Connections
NABL works closely with industry participants
Bond Dealers of America (BDA)
Council of Development Finance Agencies (CDFA)
Government Finance Officers Association (GFOA)
National Association of Health and Educational Finance Authorities (NAHEFFA)
Public Finance Network (PFN)
PFN represents hundreds of thousands of members of the municipal bond issuer and user communities including states, cities, airports, hospitals and utilities
Securities Industry & Financial Markets Association (SIFMA)

4. House Ways & Means proposal
Tax Reform 2.0
House Ways & Means proposal
Passed in House
Unclear prospects in Senate
Three bill package:
Makes permanent individual tax cuts; SALT cap
Focus on retirement savings
Focus on benefits to businesses
No mention of revenue raisers
Does this mean PABs are safe?

5. Tax Reform 2.0 (continued)
Advocacy & Education
NABL coordinating with industry friends like those mentioned earlier
Hill meetings
Ways & Means and Senate Finance Committees
Continued presence on Capitol Hill
Post-election activity
If House flips, room to revisit the items we care about
Advance refunding reinstatement legislation (Rep. Hultgren, R-IL)
Bank qualified bond legislation (formerly Rep. Reed, R-NY)
Infrastructure proposals

6. Midterm Elections Will Dems take the House or Senate?
Sources are saying 75-80% House will flip and 20% chance the Senate will flip
House:
In order to regain the majority, Democrats need to win at least 24 seats held by Republicans (while retaining their current number of seats)
There are 42 Republican open or vacant seats and only 19 Democratic open seats, leaving Rs more vulnerable in the House
Senate:
In the Senate, Democrats must retain their current number of seats ( independents) plus pick up 2 seats (
D’s defend 26 seats; R’s defend 9, leaving D’s more vulnerable in the Senate

7. A Step Back: Tax Cuts and Jobs Act
TCJA eliminated advance refundings
Revenue raiser, policy concern or both?
Congressman Randy Hultgren (R-IL) bill to reinstate advance refundings
Representatives Randy Hultgren (R-IL) and Dutch Ruppersberger (D-MD)
The PFN and NABL continue to discuss the legislation on the Hill
Ideally, Hultgren’s office would like to see it above the 100 mark for cosponsors
NABL paper: Ban on Tax-Exempt Advance Refundings – Now What?
Advance refunding alternatives
Future structuring considerations

8. HQLA legislation passed; being implemented
Securities Issues
15c2-12 Rule
Narrower than originally proposed
2 new events
Incurrence of defined material financial obligation
Default or similar event as defined
Effective February 2019
Real world impact TBD
HQLA legislation passed; being implemented
Legislation signed into law this year requires the FDIC, the Federal Reserve, and the OCC to classify qualifying investment-grade, liquid and readily- marketable municipal securities as level 2B liquid assets under the agencies’ liquidity coverage ratio rules.

9. NABL works on a variety of publications throughout the year
NABL Initiatives
NABL works on a variety of publications throughout the year
Below are examples of a few:
Disaster Recovery Bond Financing Paper (final)
Scholarly Article on Financing Sectarian Institutions (published)
Charter School Paper (draft)
Infrastructure Financing in Rural Communities (draft)

10. NABL’s Disaster Recovery Bond Financing Paper
Policy ideas for consideration by Congress as it relates to responses to major disasters.
Proposal for permanent disaster relief financing mechanisms which would be beneficial in the aftermath of a major disaster.
Suggestions are based on legislation previously adopted by Congress in response to 9/11, Hurricane Katrina, and the 2008 Midwest floods.

11. NABL Scholarly Article on Financing Sectarian Institutions
Abstract:
In transactions benefiting religious organizations, courts have historically interpreted federal and state constitutional provisions that limit government involvement with religion
The purpose of this article is to assist bond counsel in providing an unqualified opinion regarding the validity of debt under state and federal law by identifying and examining trends in court opinions dealing with sectarian institutions
The Court’s recent opinion in Trinity Lutheran Church of Columbia v. Comer suggests that jurisprudence in this field is still evolving
Published in the Municipal Finance Journal Winter 2018 Edition and in The Bond Lawyer

12. NABL Charter School Paper
The financing of charter schools with tax-exempt bonds is a rapidly expanding part of our practice
Such financings are integrally intertwined with the laws of the state in which the charter school is located
We expect to address the issues that arise in charter school financings in enough detail to alert members

13. Infrastructure Financing in Rural Communities
NABL is working on a paper summarizing the tools currently available for financing infrastructure in rural communities
Pros/challenges with such tools
Suggestions for increasing financing opportunities
Policy ideas drafted for consideration by Congress

14. Bond Related Legislation in Congress
No Tax Subsidies for Stadiums Act (H.R. 811) - bonds issued to finance professional sports stadiums meet the private security or payment test
Corresponding Senate Bill - S. 1342
Sustainable Water Infrastructure Investment Act of 2017 (H.R. 3009) - to exempt tax-exempt facility bonds for sewage and water supply facilities from the state volume caps on PABs
Facilitating Farmers' Access to Resources and Machinery Act (H.R. 1750) - with respect to private activity bond financing for first-time farmers
Move America Act of 2017 (H.R. 3912) - to allow tax-exempt Move America bonds and tax credits to be used for certain infrastructure projects
Corresponding Senate Bill – S. 1229

15. Bond Related Legislation in Congress (continued)
Public Buildings Renewal Act of 2017 (H.R. 960)* - to permit the tax-exempt financing of certain government-owned buildings by expanding the definition of "exempt facility bond"
Corresponding Senate Bill – S. 326
Student Loan Opportunity Act of 2017 (H.R. 480) – to eliminate restrictions on nonprofit scholarship funding corporations
To reinstate advance refunding bonds. (H.R. 5003) – advance refunding reinstatement
Carbon Capture Improvement Act of 2017 (S. 843) – issuance of exempt facility bonds for qualified carbon dioxide capture facilities
Corresponding House Bill – H.R. 2011

16. Bond Related Legislation in Congress (continued)
Give A HAND Act (H.R. 4172)* - tax relief for major disasters
Modernizing American Manufacturing Bonds Act (H.R. 1115)* – to modify certain rules applicable to qualified small issue manufacturing bonds
Corresponding Senate Bill – S. 773
The District of Columbia Public-Private Partnerships Home Rule Act (H.R. 7020) - would give D.C. the authority to enter into public-private partnerships
H.R to include green infrastructure bonds in the definition of qualified private activity bonds.

17. Monitor mid-term elections Continue to blanket Capitol Hill
What Next?
Monitor mid-term elections
Continue to blanket Capitol Hill
Bolster our cooperative work with BDA, CDFA, GFOA, NAHEFFA, PFN, SIFMA, and others
Share the message with our members, their clients, and beyond
NABL Governmental Affairs Committee

18. THANK YOU Dee P. Wisor President, NABL Partner, Butler Snow LLP
Jessica R. Giroux
Director of Governmental Affairs, NABL