- Comments
Suspension of Issuance of SLGS
Suggestions for changes to the extraordinary measures taken by the Department of Treasury as the United States approaches its debt limit.
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Commissioner David A. Lebryk
Bureau of Fiscal Service
Department of the Treasury
401 14th St SW
Washington DC 20227
Matthew Miller
Assistant Commissioner
Office of Public Debt Accounting
Bureau of Fiscal Service
P.O. Box 396
Parkersburg, WV 26106-0396
Vicky Tsilas
Associate Tax Legislative Counsel
Department of the Treasury
1500 Pennsylvania Avenue, NW
Washington DC 20220
Kent Hiteshew
Director
Office of State and Local Finance
Department of the Treasury
1500 Pennsylvania Ave., NW
Washington DC 20220
Re: Suspension of Issuance of State and Local Government Securities
Gentlemen and Ms. Tsilas:
The National Association of Bond Lawyers (“NABL”) respectfully submits the
attached memorandum containing suggestions for changes to the extraordinary measures
taken by the Bureau of Fiscal Service (“BFS”) of the Department of the Treasury
(“Treasury”) when Treasury determines that debt of the United States subject to the
statutory debt limit is approaching that limit. Among the extraordinary measures taken
under present procedures is the suspension of acceptance of new subscriptions for the
purchase of Treasury Securities – State and Local Government Series (“SLGS”), including
investments for zero coupon SLGS as may be required by certain defeasance escrows.
As described in the attached memorandum, the suspension of acceptance of new
subscriptions imposes costs on issuers of tax-exempt debt, particularly smaller issuers. We
believe that it might be possible to modify the current procedures so as to mitigate or
eliminate the costs to issuers while at the same time meeting the needs of the Treasury as it
manages the public debt.
NABL was incorporated in 1979 to provide a forum for the exchange of ideas as
to law and practice relating to state and municipal bonds and to provide advice and
comment with respect to legislation, regulations, rulings and other actions affecting state
and municipal obligations. NABL has approximately 2700 members.