Handbook of municipal bonds:
Saved in:
| Format: | Book |
|---|---|
| Language: | English |
| Published: |
Hoboken, NJ
Wiley
2008
|
| Series: | The Frank J. Fabozzi series
|
| Subjects: | |
| Online Access: | Inhaltsverzeichnis |
| Physical Description: | XLIV, 1332 S. graph. Darst. |
| ISBN: | 9780470108758 |
Staff View
MARC
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| 245 | 1 | 0 | |a Handbook of municipal bonds |c Sylvan G. Feldstein ; Frank J. Fabozzi, [eds.] |
| 264 | 1 | |a Hoboken, NJ |b Wiley |c 2008 | |
| 300 | |a XLIV, 1332 S. |b graph. Darst. | ||
| 336 | |b txt |2 rdacontent | ||
| 337 | |b n |2 rdamedia | ||
| 338 | |b nc |2 rdacarrier | ||
| 490 | 0 | |a The Frank J. Fabozzi series | |
| 650 | 4 | |a Finanzwirtschaft | |
| 650 | 4 | |a Finance, Public | |
| 650 | 4 | |a Municipal bonds | |
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| 700 | 1 | |a Fabozzi, Frank J. |d 1948- |e Sonstige |0 (DE-588)129772054 |4 oth | |
| 856 | 4 | 2 | |m Digitalisierung UB Regensburg |q application/pdf |u http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=016033201&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA |3 Inhaltsverzeichnis |
| 999 | |a oai:aleph.bib-bvb.de:BVB01-016033201 | ||
Record in the Search Index
| _version_ | 1804137110186229760 |
|---|---|
| adam_text | Contents
Foreword
xxxi
Christoper Kit Taylor
Preface
xxxiii
About the
Editors xxxix
Contributing Authors
xli
PARTOM
The Sell Side: The Originators of Deals
1
CHAPTER
1
The Central Place of States and Local Governments
in American Federalism
3
Richard Briffault
The States
7
The Complex Structure of American Local Government
12
From Dillon s Rule to Home Rule
17
Forms of Local Government
19
Metropolitan Governance
21
Summary
23
CHAPTER
2
An Overview of Investment Banking
25
Herman
Й.
Charbonneau
Overview of Public Finance Banking
25
Regional Broker-Dealer Firms
29
Strategic Advantages for the Regional Firm
31
Disadvantages Faced by the Regional Firm
34
Importance of a Weil-Defined Plan
35
Recent Challenges
39
The Outcome of Regional Banking Efforts
41
Vi
CONTENTS
CHAPTER
3
Role of the Financial Advisor
43
William H. Wood
Overview of Financial Advisors and Their Roles
43
Financial Advisors in Negotiated Transactions
44
Financial Advisors in Competitive Transactions
45
Securities Dealers as Financial Advisors
45
Independent Financial Advisors
46
Pricing of Financial Advisory Services
46
Details Regarding the Financial Advisor s Functions
47
Typical Advisory Services Provided In Connection with
an Interest Rate Swap
48
How to Hire a Financial Advisor
49
Summary
50
CHAPTER
4
Method of Sale in the Municipal Bond Market
51
Jun Peng,
Kenneth A. Km, and Tracy Neish
Method of Sale
52
Debate on the Method of Sale
57
Historical Data on Use of Sale Method
62
Summary
66
CHAPTERS
The Role of Bond Counsel in Public Agency financing
69
John
L
Kraft
History of Bond Counsel
69
Review of Bond Counsel Opinion
70
Further Tax Developments
75
Disclosure and Securities Laws
75
Recent Developments
76
CHAPTER
6
The Role of Counsel to the Underwriters
79
Mary
G
.
Wilson
Structuring
80
Securities Laws
80
Underwriting Documents
85
Review of Other Bond Documents
87
Contents____________________________________________________________________
Vii
Blue Sky
88
Opinion
88
Summary
89
СНАРТШ7
Summary ol Federal Tax Requirements for Tax-Exempt Bonds
91
Perry
E
.
Israel
Arbitrage
93
Private Activity Bonds
108
Other Miscellaneous Rules, Including Refundings
120
Conclusion
125
CHAPTBte
The Role of the Municipal Bond lrustee
127
James E. Spiotto
The Nature of the Bond Trustee s Duties and Responsibilities
127
The Municipal Bond Trustee Preclosing
132
Administration of the Transaction by the Bond Trustee
135
Selected Challenges and Issues for
Municipal Trustees Postissuance
137
Summary
144
Chapter
9:
The Last Resort for financially Distressed Municipalities
145
James E. Spiotto
Historically, Bankruptcy Has Been a Mechanism of
Debt Adjustment in Other Countries
149
Brief History of Municipal Bankruptcy Legislation in the
United States
150
Existing Municipal Bankruptcy Provisions
153
Initiation of Chapter
9
Proceeding and Effect on
Bondholder Rights and Remedies
156
Unique Features of Chapter
9 161
The Required Maintenance of Municipal Service During a
Municipal Bankruptcy
163
Labor Contracts Are an Important Element of the
Municipal Budget Whose Status in a Chapter
9
Has Been Subject of Discussion
164
Statute Governing the Rejection of Collective Bargaining
Agreement in Corporate Context
165
Vii]
____________________________________________________________
CONTENTS
Special
Revenues
Pledged to Bondholders
166
Payments to Bondholders Are not Preferences
168
Use of Letters of Credit as Backing for Municipal and
Conduit Obligations
169
Plan of Adjustment for Municipality Time, Content,
Impairment of Claims and Acceptance
170
Postpetition
Disclosure and Solicitation
174
Acceptance of the Plan
175
Confirmation of Plan
176
Appendix: Chapter
9
Cases Filed as of February
8, 2007 180
CHAPTER
10
Sunnational Infrastructure Finance in the Emerging Markets:
A Financial Guaranty Perspective
1
9T
Thomas
И.
Cochran, Anthony Pellegrini, David Stevens,
Richard
Torkelson,
and David White
The Development and Growth of Locally Denominated
Contractual Savings Pools and Credit Markets
192
The Devolution Revolution: Decentralization and/or
Privatization Is Continuing in
Virtually All Emerging Markets
195
Developing Financially Sustainable Subnational
Infrastructure Credits in the Emerging Markets
198
Conclusions
222
CHAPTER
11
The
Role oí
the Rating Agencies
223
Edward A. Rabson
Moody s Investors Service
224
Standard
&
Poor s
227
Fitch Ratings
231
Summary
233
CHAPTER
12
Municipal Bond Retimdhigs
235
William H. Wood
Refunding Overview
235
Reasons to Sell Refunding Bonds
236
Issues Relating to Structuring a Refunding Bond Issue
238
When Should an Issuer Refund Prior Bonds?
242
Contents______________________________________________________________
¡Χ
Refundings and Derivatives 244
Competitive
versus
Negotiated Sale
246
Conclusions
246
CHAPTER
13
Public-Private Partnerships
247
Robert H.
Muller
History
248
The Process of Privatization
252
Summary
261
PART TWO
The Sell Side: Distribution and Market-Making Roles
263
CHAPTER
14
The Role of the Underwriter
265
Christopher
J. Mier
The Underwriter s Role in Context
265
When Does the Underwriter Become Involved in the Process?
266
The Lead-Up to Pricing
268
Summary
271
CHAPTER
15
The Roles of Traders and Brokers
273
JonPaulZaptin
Traders
273
Types of Traders
277
Watching the Taxable Markets
278
Trading Discipline and Mental Attitudes
278
Who Becomes a Trader?
279
Brokers
280
A Word on E-Commerce
281
Summary
281
CHAPTER
16
Municipal Arbitrage and Tender Option Bonds
283
Bart Mosley
Relative Value—What Should a Municipal Bond Be Worth?
284
How Municipal Arbitrage Works
286
χ
CONTENTS
Where Does the Municipal Yield Curve s Steepness Come from?
292
Conclusion
2,94
Appendix: Tender Option Bonds in a Nutshell
296
CHAPTER
17
Interest Rate Swaps and Their Application to Tax-Exempt Financing
299
EricH.
Chu,
Craig Underwood, Thomas B. Fox, Jon A. McMahon,
Roger
L
Davis, Stephen A. Spitz, Albert Simons III, and George B. Wolf
What Are Swaps and How Do They Work?
300
Types of Swaps and Other Hedges
305
Uses and Benefits
311
Business Risks
315
How to Acquire a Swap
317
Legal Issues
323
Tax Issues
326
Documentation and Negotiation
333
After the Close:
Posttrade
Management
337
Appendix: Glossary of Key Terms
340
CHAPTER
19
The Regional №m: Its Customers, Traders, and Institutional Salespeople
345
Nlychele
Lindvall
Understanding Regional
345
Trading
347
The Regional Institutional Salesperson and Their Customers
351
The Skills of the Salesperson
353
CHAPTER
18
Changing Roles of Buyers and Sellers of Municipal Bonds:
Une
Participant s View
355
William J.
Darusmont
Communications and Technology
357
The
Legai
Opinion and Indenture of a Municipal Bond
357
The Role of Credit Agencies
358
Changes in Tax-Exempt Status
358
Pricing Transparency
359
The Buyers of Municipals
359
Sellers of Municipal Bonds
360
The Future as Prologue
362
Contents_____________________________________________________________Xi
CHAPTER
20
The Depository Trust Company and
Real-Time
Price Transparency
365
Sylvan G.
Feldstein
and David
Ratner
The Depository Trust
бе
Clearing Corporation
365
Summary
370
CHAPTER
21
i-Deal/lpreo: The Transaction Platform
373
Allen Williams
The Evolution of New-Issue Technology
373
Order Entry
374
The Issuer and Prospectus Delivery
375
The Future
375
Summary
379
PART THREE
Compliance Issues
381
CHAPTER
22
The Municipal Securities Rulemaknuj Board
383
PaulS.
Масо
and Jennifer Webster
Taf f e
Organization of the MSRB and the Scope of
Rulemaking Authority
385
Professional Qualifications, Supervision,
Recordkeeping and Compliance
386
Uniform Practice Rules
388
Municipal Market Transparency and the MSRB
390
Fair Dealing and Suitability
391
Municipal Securities Information Library
393
Market Integrity
394
Additional Information Regarding MSRB
396
CHAPTER
23
The Role of the Securities and Exchange Commission
397
Paul S.
Масо
and Cristy C. Edwards
Framework of the Federal Securities Laws
399
Application to Municipal Securities
407
Rule 15(c)2-12
420
Xii CONTENTS
CHAPTER
24
Sarbanes-Oxley and the Securities and Exchange Commission
425
PaulS.
Масо
The Act
426
Conclusion
446
CHAPTER
25
Using Auditing Techniques to Develop Investment Adviser
Compliance
Procédures
447
Kevin Reilly
Getting Started
448
Understanding the Process
448
Document the Process
453
Review the Process
454
Revise the Process Documentation
456
Summary
456
CHAPTER
26
Ride
28-7:
Legal and Research Issues for
Tax-Exempt Money Market Funds
459
Stephen A. Keen and Leslie K. Ross
Definition of a Tax-Exempt Money Market Fund
460
General Requirements of Rule 2a-7
462
Eligible Securities for Tax Exempt Funds
469
Diversification of Tax Exempt Funds Under Rule 2a-7
477
Application of Rule 2a-7 to Municipal Securities
482
Postacquisition Constraints Imposed by Rule 2a-7
496
Summary
498
PART FOUR
Fixed Income Analysis of Municipal Products
501
CHAPTER
27
Evaluation
oí
Municipal Bonds
503
Gerard Brennan
The Need for Evaluations
503
Tools of Evaluation
504
Adjusting for Different Types of Municipal Bonds
507
Contents__________________________________________________________________Xiii
Other Considerations
507
The Future of Municipal Bond Evaluation
511
CHAPTER
28
Valuation of Municipal Bonds with Embedded Options
513
Frank J. Fabozzi, Andrew Kalotay, and Michael P. Dorigan
Underlying Principles
514
Overview of Bond Valuation
514
Valuation Model
516
Specific Adjustments to the Valuation Model
for Municipal Bonds
527
Tax Adjustments to the Model
528
Horizon Price
532
Other Values Calculated from the Model
533
Relative Value Analysis of Municipal Bonds
534
Summary
535
CHAPTER
29
Analyzing and Evaluating Tax-Exempt Indexed Floaters:
Investor and Issuer Perspectives
537
Yingchen Li
Breakeven Equation for the Issuer
537
Risk Analysis of LIBOR-Indexed Floaters
538
Other Percent LIBOR-Indexed Floaters
539
Percent BMA-Indexed Floaters
540
CMS and BMS
541
Percent CMS-Indexed Structures
541
Risks of Percent CMS and Percent BMS
542
Summary
543
CHAPTER
30
Municipal Inverse floating Rate Securities
545
Cadmus Hicks
Description
545
Tax Treatment
546
Computations
547
Accounting Treatment
550
Tender Option Bonds
551
Summary
551
xiv
CONTENTS
CHAPTER
31
Analyzing Portfolios Daily
553
Paul R. Daniels
A Four-Level Framework for Portfolio Assets
554
Credit-Level Analysis
555
Basic Holding-Level Analysis
557
Total Return Performance
562
Simulations
564
Portfolio Structure: Compliance and Targets
566
Reporting
567
A Secret Formula?
567
Summary:
20
Ingredients for Success
568
снАРТшзг
Discovering Relative Value Using Custom Indices
571
Daniel
J
.
Garrett
Intuitive Patterns
571
Empirical Patterns
572
Discovery
572
Caveats and Disclaimers
575
Conclusion
575
СНАРТШЗЗ
Municipal Bond Swaps
577
Evan
С
Rourke
Description of a Bond Swap
577
Tax Swapping
577
Other Types of Municipal Bond Swaps
579
Summary
580
СНАРТШ34
The Tax Treatment of Municipal Bonds
581
Martin J.
Mauro
and Philip Fischer
Federal Tax Treatment of Municipal Bonds
581
Calculating the Effective Tax Rate on Interest Income from
Out-of-State Municipal Bonds
585
Summary
588
Contents___________________________________________________________________
XV
РАЯТП
VE
The Buy Side: Institutional Investors
589
CHAPTER
35
Managing a National Municipal Bond Fund
581
Alexander Grant
The Investor Who Buys the Fund
592
National versus State-Specific Funds
593
Total Rate of Return
594
Managing a Fund by Relative Value
595
Issues of Coupon and Structure
596
Traditional Buyers versus the Arbitrageurs
597
Conclusion
598
CHAPTER
36
Managing a High-Yield Municipal Fund
599
Wayne Godlin, Jim Phillips, Bill Black,
Barnet
Sherman,
Mark Paris, and Seth Horwitz
High-Yield Borrowers
600
High-Yield Municipal Bond Fund Track Record
601
Credit Analysis
603
Sector Allocation
603
Trading Opportunities
604
Story Bonds
606
Opportunity Bonds
607
Credit Improvement and Enhancement
607
Derivatives
608
The Use of Benchmarks
610
High-Yield Municipal Fund Infrastructure
610
Summary
611
CH
APTEK
37
Managing
Municipal Bonds
ЮТ
Property and
Casualty Insurance
Gompartes
tor Total Return
613
Karen
Szerszeń
Business of Property and Casualty Insurance Companies
613
Combined Ratio
614
Total Return versus Benchmark
616
Regulatory Factors
616
Tax Risk
618
xv¡
_____________________________________
CONTENTS
Credit Risk
619
Interest Rate Risk
622
Conclusion
623
СНАРТИЗб
The Role of Hedge Funds in Me Municipal Market
625
Jonathan A. Fiebach
Ratio Curves
626
Hedge Fund Activity
628
Conclusion
631
CHAPTER
39
Managing Municipal Bond Portfolios for High-Net-Worth Investors
633
Thomas P. Dalpiaz
A Living, Breathing Human Being
633
Emotional
Ups
and Downs
634
Transparency
634
Education
634
The Starting Point
634
The Client s Existing Situation
635
Uncovering Client Objectives
636
What Is the Client Really Trying to Achieve in the
Bond Market?
636
Articulating Objectives and Setting Parameters
637
Performance Measurement
638
Uncovering Value in the Municipal Bond Market
640
Confronting Interest Rate Risk
640
Confronting Credit Risk
642
Confronting Call Risk
642
Confronting Liquidity Risk
643
Yield Curve Analysis
644
Bond Swapping
644
Using Balance in Portfolio Construction and Reconstruction
645
Portfolio Distributions
646
Municipal Bonds: A Most Necessary Investment
646
СНАРТШ40
Municipal Credit Default Swaps
647
Frank
J
.
Fabozzi
Single-Name Municipal CDS Contract
648
Contents___________________________________________________________________
XVII
Uses of Municipal CDS by Portfolio Managers
652
Second Generation of Credit Default Swaps
654
Summary
655
CHAPTER
41
Municipal Collateralized Debt Obligations
657
Rebecca Manning, Douglas J. Lucas, Laurie S. Goodman, and
Frank J. Fabozzi
CDO Basics
658
Muni CDOs
662
Summary
663
CHAPTER
42
Performance Attribution of Municipal Bonds
665
Daniel J. Garrett
Which Approach for Municipal Bonds?
666
What Doesn t Work for Municipal Bond Attribution
667
The Better Approach for Municipal Bond Attribution
670
Mathematics of Returns-Based Attribution
672
Examples of Returns-Based Attribution for Municipal Bonds
677
Client Stories: Applying Municipal Bond Attribution
684
Summary
686
PART SIX
Credit Analysis
689
CHAPTER
43
The Role of the National Federation of Municipal Analysts in
Promoting Better Disclosure
691
Lisa Good, Gerry
Lian,
Tom Weyl, Gregory A. Clark, and Gregory kikman
Summary of NFMA Initiatives
692
The Special Importance of Disclosure
693
A Detailed Look at the NFMA s Recommended Best Practices
697
Procedure for Developing RBP Documents
698
The Mechanical Steps Used to Develop an RBP Document
701
Current Issues and Challenges Facing the NFMA
702
CONTENTS
CHAPTER
44
A History of Modern Municipal Defaults
707
James E. Spiotto
Analysis of Defaults of Municipal Debt in the United States
707
Lessons Learned from Troubled Municipal Financing
719
Summary of Lessons Learned
726
Rules for Survival
727
Appendix: The Structure for Oversight and Emergency Financing
728
CHAPTffl«
New Issues in Municipal Accounting
733
Daviti
Я.
Bean and Dean Michael Mead
Structure of Governmental Financial Statements
734
Information Presented in Basic Financial Statements and RSI
735
Summary
764
CHAPTBt46
Managing a Buy-Side Municipal Bond Research
Department 767
Richard A. Diccarone
Assessment of Challenges
768
Summary
777
ШРТН47
The Role of an Activist Bond Analyst
779
Arthur
E
.
Sch/oss
Activist Bond Analyst s Approach to Improving Stressed or
Deteriorating Credits
779
Watchful Waiting
782
Asset Preservation
783
The Conference Call
783
Covenant Waivers/Consultants
784
Project Sale to External Buyer
785
The Debt Service Reserve Fund
786
Deleveraging
786
Conclusion
78
g
Contents________________________________________________________
Т
CHAPTER
48
How to Analyze General Obligation Bonds
789
Sylvan G.
Feldstein
and Terry
J.
Goode
The Issuer s Debt Structure and Security for
General Obligation Bonds
790
The Issuer s Budgetary Operations
796
The Issuer s Revenue Structure
801
The Economy
802
The More Important Debt Ratios
806
Conclusion
807
CHAPTER
49
Credit Worthiness of Revenue Bonds
809
Sylvan G.
Feldstein
Limits of the Basic Security
810
Flow-of-Funds Structure
810
Rate, User Charge or Dedicated Revenue and
Tax Covenants
811
The Priority of Pledged Revenue Claims
811
The Additional Bonds Test
811
Other Relevant Covenants and Issues
812
CHAPTER SO
How to Analyze Airport Revenue Bonds
813
William
£
Oliver and
Dary
I Clements
Airport Ownership Structures
813
Passenger Demand Characteristics
814
Competition
816
Use and Lease Agreements
816
Gate Control
817
Airport Management
818
Conclusion
818
CHAPTER SI
Land-Secured Bonds
821
Ronald
L
Mintz
Advantages of Land-Secured Bonds
821
General Characteristics of Land-Secured Bonds
822
xx
CONTENTS
Credit Criteria
824
Role of the Developer
832
Disclosure
*■>
The Land-Secured Bond Market
835
Bond Structures
842
Conclusion
843
CHAPTER
52
Hospital Bond Analysis
845
Lynn
Cavallaro
National Level Overview
846
Local Level Review
850
Hospital Level Review
851
Transaction-Specific Risks
856
Examples of Hospital Downgrades
857
Conclusion
858
CHAPTER
53
861
Kurt van
Kuller
The Appeal of Single-Family Bonds
861
SF Bond Issuance Record in
2006 864
Credit Strength of SF Bonds
867
A Unique Basket of Call Options
871
Prepayments in SF Bonds
872
Municipal Prepayment Speeds
874
Other Ways of Handling Prepayments
879
PAC
Bonds
879
Discriminating between
PAC
Bonds
880
Passthroughs
881
Lockout Bonds
881
Crosscalling
882
The Ten Year Rule
884
Universal Cap Regulations
886
The Unused Proceeds Call
886
Optional Redemptions in Single-Family Bonds
888
Pricing Single-Family Bonds
889
Concluding Remarks
891
Contents____________________________________________________________________XXi
CHAPTER
54
Multifamily Bonds 893
Kurt van Kuller
Multifamily Bond Market Parameters 893
AMT
Penalizes the Sector
895
Multifamily
Supply
Outlook Positive 897
Volume
Cap Constrains Bond Issuance
897
Great Diversity of Issuers
897
Abundance of Project Types
899
Multifamily Bonds: Default Rates
901
Multifamily Default Cycles
902
An Array of Credit Enhancements
904
The Low Income Housing Tax Credit
905
FHA Insurance
905
Risk Sharing: Superior FHA Program
908
GNMA Backed Multifamily Bonds
909
Project-Based Section
8 911
FHA Section
8
Mark-to-Market
913
Section
236
Interest Subsidy
914
Affordable Housing Projects
915
Tax Opinion Risks
916
Multifamily Bond Redemptions
916
Prepayments in Multifamily Bonds
918
Other Call Options in Multifamily Bonds
920
Conclusion
921
CHAPTER
55
Tax-Exempt Electric Utility Debt
923
GaryM.
Meilenstein
and Paul R. Bockwoldt
Structure of the U.S. Electric Industry
925
Cost of Electricity
933
Charges for Service
934
Credit Considerations
935
Summary
939
CHAPTER 5G
How to Analyze Startup Continuing Care Retirement Community Bonds
941
EdwardC.
Meni
gait
Accommodation and Service Options
941
Residency Contracts
943
xx¡i
CONTENTS
Ownership, Governance, and Management
946
Demand Analysis of Independent Living Units
947
The Analysis of Advance Fee Deposits and
Monthly Service Fee Prices
950
Assisted Living Unit and Nursing Care Bed Demand Analysis
950
Utilization and Fill-Up Expectations
951
Financial Statement Analysis
951
Ratio Analysis
952
Legal Security Features and Covenant Considerations
953
Continuing Disclosure
954
Summary
955
CHAPTER
57
How to Analyze Tobacco Bonds
957
Gerry
Lian
Background
957
Analysis of Structural Risk
964
Analysis of Corporate Credit Risk
965
Analysis of Cash Flow Risk
968
Analysis of Litigation Risk
971
Conclusion
978
CHAPTER
58
Toll Road Analysis
981
Robert
И.
Muller
History
981
Key Analytical Factors
984
Conclusion
993
CHAPTERS
Water and Sewer Bond Analysis
995
Brian Winters
Structure
996
Management
997
Economic Base
997
Financial Ratios
998
Bond Security
1000
Environmental Issues
1002
Other Considerations
1002
Conclusion
1002
Contents_________________________________________________________________xxiii
РАЯТ
SEVEN
Special Security Structures and Their Analysis
1005
CHAPTER BO
Evaluating Tax-Exempt Commercial Paper
1007
Maria C. Sazon
Overview of Commercial Paper
1007
Repayment of Commercial Paper Notes
1008
Analyzing Various Sources of Repayment for
Commercial Paper
1009
Analyzing Commercial Paper without Enhancement
1011
Summary
1012
CHAPTER
61
The Use of Letters-of-Credit in Connection with Municipal Securities
101
б
Todd P. Zerega
Overview of LOCs
1016
Considerations in Reviewing a LOC-Backed Security
1019
Conclusion
1023
CHAPTER G2
How to Analyze Tax, Bond, and Grant Anticipation Notes
1025
Sylvan
6. Feldstein
and Frank J. Fabozzi
Two Major Purposes of Notes
1025
Security Behind Tax and Revenue Anticipation Notes
1026
Information Needed Before Buying Tax or
Revenue Anticipation Notes
1027
Summary
1029
CHAPTER
63
How to Analyze Refunded Municipal Bonds
1035
Sylvan
ß. Feldstein
Pure versus Mixed Escrow Funds
1035
What are the Reasons for Refundings?
1036
Two Types of Refunded Bonds
1037
Determining the Safety of the Refunded Bonds
1038
XXIV CONTENTS
CHAPTER
64
Pollution Control Revenue, Industrial Development Revenue, and
Conduit Financing Bonds
1041
Gary Krellenstein
Security
1042
Restrictions on Issuance and Refunding of PCR/IDR Debt
1044
Call Features
1047
Summary
1048
CHAPTER
65
How to Analyze FHA-lnsured Mortgage Hospital Bonds
1049
Sylvan B.
Feldstein
FHA Hospital Mortgage Insurance
1050
Credit Risk
1051
The Prudent Man Evaluation Approach
1053
Summary
1054
CHAPTER
66
How to Analyze Higher Education Bonds
1
05S
Bradley
D
.
Minoke
The Institution
1056
Use of Bond Proceeds
1057
Security
1058
Degrees and Programs
1060
Student Demand
1060
Management and Governance
1064
Faculty and Staff
1065
Tuition and Financial Aid
1066
Financial Statements
1067
Endowment Funds
1072
Plant and Facilities
1073
Fundraising Abilities
1074
Definitions of Certain Terms
1074
Continuing Disclosure
1074
Conclusion
1075
Contents_____________________________________________________________________
XXV
CHAPTER
67
Analyzing Human Service
Provider
Bonds
1077
Ruben
Selles
Milestones in the Development of Human Service Providers
1078
Risk Factors Associated with Human Service Providers
1081
Summary
1083
CHAPTER
68
How to Analyze the Municipal Bond Insurers
and the Bonds They Insure
1085
Donald King
С
Ml
lo
What Is Municipal Bond Insurance?
1085
Municipal Bond Insurance Benefits
1087
Additional Benefits of Bond Insurance
1089
Types of Municipal Bond Insurance
1090
Municipal Bond Insurance Providers
1091
Other Municipal Bond Insurance Providers
1092
Reinsurance
1093
Telling the Difference
1094
Financial Factors
1096
Other Financial Factors
1097
Other Businesses
1098
Conclusion
1099
CHAPTER
68
Student Loan Financing: Risk Evaluation Tax-Exempt and
Taxable Markets Converge
1101
Diane R. Maurice andAnkur Goyal
Tax-Exempt Issuers and Privatization Trends
1103
Systemic Shift-Risk Transference
1107
Guaranteed versus Private Loans
1108
Risk Profile Evolves
1109
Summary
1109
Appendix: Recent Investigatory and Legislative Developments
1111
CHAPTER
70
Analysis of
Tribal
Casino Bonds
1118
Megan Neuburger, Michael
Paladino,
Jessalynn Mom, and David Litvack
Issuer Credit Factors
1120
Bond Structure and Security Features
1126
Summary
1128
XXVi
_________________________________________________________CONTENTS
CHAPTER
71
Understanding Variable Rate Demand Obligations
1129
Mitchell Savader
How VRDOs Work
1129
The Need for Cash
1130
The Role of Bond Insurance
1131
CHAPTER
State Credit Enhancement Programs for
School Districts and Municipalities
1133
Harold B. Burger
Types of State Credit Enhancement Programs
1134
Assessing State Credit Enhancement Programs
1135
Credit Enhancement Program Advantages and Disadvantages
1136
Summary
1139
CHAPTER
73
The ABCs of Charter Schools
1141
Mitchell Savader
Understanding Charter Schools
1141
The Charter
1142
The Relationship between Demand and Financial Success
1144
Summary
1146
CASE STUDES DFINOVATJVE AND OTHffi SECURITY STRUCTURES
CASE STUDY
1
New York City Uses Taxable Municipals After
9/11
for
Budget Itetof and Affordable Housing
1149
Emily A. Youssouf
CASE STUDY
2
9/11,
Subprkne Loans, and the Magnofta Park Apartments Bond Default
1153
Michael
J
.
Ross
CASE STUDY
3
Newport News Issues an Energy Savings COP
1191
A. Theodore Palatucci
Contents___________________________________________________________
XXVii
CASE STUDY
4
Tax-Exempt Airport Finance: Tales from the Friendly Skies
1165
James E. Spiotto
CASE STUDY
S
Toronto s Highway
407 1185
William E. Oliver
CASE STUDY
6
Disney s California Adventure and Tax-Exempt Bonds
1191
Hilary E.
Feldstein
CASE STUDY
7
Super Bowl
XXXII
Helps Resolve Bond Default
1195
Bill
Ни с к
CASE STUDY
8
A Tax-Exempt Prepay Natural Gas Purchase Bond
1201
Sandra McDonald
CASE STUDY
9
Universal Studios Road Financing:
Hrst
with Special Assessment
Bonds and Second with Tax Increment financing Bonds
1207
Hilary
E
. Feldstein
CASE STUDY
10
California s Workers Compensation msurance Crisis and the
financing of the California Insurance Guarantee Association
1211
Anthony H. Fisher
CASE STUDY
11
Dreamworks Tries to Issue Tax-Exempt Bonds
1215
RichSaskal
XXViÜ
________________________________________________________CONTENTS
CASE STUDY
12
Financings of the Medical University Hospital Authority
of South Carolina
1217
Joseph A. Spiak
CASE STUDY
13
Niagara Falls Memorial Medical Center
1223
Herman R. Charbonneau
CASE STUDY
14
Aruba
Airport Authority Airport Revenue Bonds
1227
William E. Oliver
CASE STUDY
15
Yankees versus
Mets: A
Subway Series
1233
Mitchell Savader
CASE STUDY
16
Good Swap, Bad Swap
1237
Peter Shapiro
CASE STUDY
17
Westminster-Canterbury of the Blue Ridge
Continuing Care Retirement Community
1241
Marie S. Pisecki
CASE STUDY
18
Preserving Housing Affordability with Taxable Municipals
1249
Emily A. Youssouf
CASE STUDY IS
Massachusetts Sells LffiOR Index General Obligation Bonds
with an Interest Rate Swap
1253
Sylvan G.
Feldstein
and Patrick Landers
Contents___________________________________________________________________XXiX
CASE STUDY
20
Developing Hudson Yards with a
$2
Billion Bond Issue
1257
James McSpiritt
CASE STUDY
21
Seminoie iride
Bets on Taxability
1263
Joseph
Krist
APPENDIX A
A Pictorial History of Municipal Bonds
1269
Sylvan G.
Feldstein
and Peter O Brien
APPENDIX
В
Glossary of Terms
1291
Mitchell Savader
Index
1297
|
| adam_txt |
Contents
Foreword
xxxi
Christoper "Kit" Taylor
Preface
xxxiii
About the
Editors xxxix
Contributing Authors
xli
PARTOM
The Sell Side: The Originators of Deals
1
CHAPTER
1
The Central Place of States and Local Governments
in American Federalism
3
Richard Briffault
The States
7
The Complex Structure of American Local Government
12
From Dillon's Rule to Home Rule
17
Forms of Local Government
19
Metropolitan Governance
21
Summary
23
CHAPTER
2
An Overview of Investment Banking
25
Herman
Й.
Charbonneau
Overview of Public Finance Banking
25
Regional Broker-Dealer Firms
29
Strategic Advantages for the Regional Firm
31
Disadvantages Faced by the Regional Firm
34
Importance of a Weil-Defined Plan
35
Recent Challenges
39
The Outcome of Regional Banking Efforts
41
Vi
CONTENTS
CHAPTER
3
Role of the Financial Advisor
43
William H. Wood
Overview of Financial Advisors and Their Roles
43
Financial Advisors in Negotiated Transactions
44
Financial Advisors in Competitive Transactions
45
Securities Dealers as Financial Advisors
45
Independent Financial Advisors
46
Pricing of Financial Advisory Services
46
Details Regarding the Financial Advisor's Functions
47
Typical Advisory Services Provided In Connection with
an Interest Rate Swap
48
How to Hire a Financial Advisor
49
Summary
50
CHAPTER
4
Method of Sale in the Municipal Bond Market
51
Jun Peng,
Kenneth A. Km, and Tracy Neish
Method of Sale
52
Debate on the Method of Sale
57
Historical Data on Use of Sale Method
62
Summary
66
CHAPTERS
The Role of Bond Counsel in Public Agency financing
69
John
L
Kraft
History of Bond Counsel
69
Review of Bond Counsel Opinion
70
Further Tax Developments
75
Disclosure and Securities Laws
75
Recent Developments
76
CHAPTER
6
The Role of Counsel to the Underwriters
79
Mary
G
.
Wilson
Structuring
80
Securities Laws
80
Underwriting Documents
85
Review of Other Bond Documents
87
Contents_
Vii
Blue Sky
88
Opinion
88
Summary
89
СНАРТШ7
Summary ol Federal Tax Requirements for Tax-Exempt Bonds
91
Perry
E
.
Israel
Arbitrage
93
Private Activity Bonds
108
Other Miscellaneous Rules, Including Refundings
120
Conclusion
125
CHAPTBte
The Role of the Municipal Bond lrustee
127
James E. Spiotto
The Nature of the Bond Trustee's Duties and Responsibilities
127
The Municipal Bond Trustee Preclosing
132
Administration of the Transaction by the Bond Trustee
135
Selected Challenges and Issues for
Municipal Trustees Postissuance
137
Summary
144
Chapter
9:
The Last Resort for financially Distressed Municipalities
145
James E. Spiotto
Historically, Bankruptcy Has Been a Mechanism of
Debt Adjustment in Other Countries
149
Brief History of Municipal Bankruptcy Legislation in the
United States
150
Existing Municipal Bankruptcy Provisions
153
Initiation of Chapter
9
Proceeding and Effect on
Bondholder Rights and Remedies
156
Unique Features of Chapter
9 161
The Required Maintenance of Municipal Service During a
Municipal Bankruptcy
163
Labor Contracts Are an Important Element of the
Municipal Budget Whose Status in a Chapter
9
Has Been Subject of Discussion
164
Statute Governing the Rejection of Collective Bargaining
Agreement in Corporate Context
165
Vii]
_
CONTENTS
"Special
Revenues"
Pledged to Bondholders
166
Payments to Bondholders Are not Preferences
168
Use of Letters of Credit as Backing for Municipal and
Conduit Obligations
169
Plan of Adjustment for Municipality Time, Content,
Impairment of Claims and Acceptance
170
Postpetition
Disclosure and Solicitation
174
Acceptance of the Plan
175
Confirmation of Plan
176
Appendix: Chapter
9
Cases Filed as of February
8, 2007 180
CHAPTER
10
Sunnational Infrastructure Finance in the Emerging Markets:
A Financial Guaranty Perspective
1
9T
Thomas
И.
Cochran, Anthony Pellegrini, David Stevens,
Richard
Torkelson,
and David White
The Development and Growth of Locally Denominated
Contractual Savings Pools and Credit Markets
192
The Devolution Revolution: Decentralization and/or
Privatization Is Continuing in
Virtually All Emerging Markets
195
Developing Financially Sustainable Subnational
Infrastructure Credits in the Emerging Markets
198
Conclusions
222
CHAPTER
11
The
Role oí
the Rating Agencies
223
Edward A. Rabson
Moody's Investors Service
224
Standard
&
Poor's
227
Fitch Ratings
231
Summary
233
CHAPTER
12
Municipal Bond Retimdhigs
235
William H. Wood
Refunding Overview
235
Reasons to Sell Refunding Bonds
236
Issues Relating to Structuring a Refunding Bond Issue
238
When Should an Issuer Refund Prior Bonds?
242
Contents_
¡Χ
Refundings and Derivatives 244
Competitive
versus
Negotiated Sale
246
Conclusions
246
CHAPTER
13
Public-Private Partnerships
247
Robert H.
Muller
History
248
The Process of Privatization
252
Summary
261
PART TWO
The Sell Side: Distribution and Market-Making Roles
263
CHAPTER
14
The Role of the Underwriter
265
Christopher
J. Mier
The Underwriter's Role in Context
265
When Does the Underwriter Become Involved in the Process?
266
The Lead-Up to Pricing
268
Summary
271
CHAPTER
15
The Roles of Traders and Brokers
273
JonPaulZaptin
Traders
273
Types of Traders
277
Watching the Taxable Markets
278
Trading Discipline and Mental Attitudes
278
Who Becomes a Trader?
279
Brokers
280
A Word on E-Commerce
281
Summary
281
CHAPTER
16
Municipal Arbitrage and Tender Option Bonds
283
Bart Mosley
Relative Value—What "Should" a Municipal Bond Be Worth?
284
How Municipal Arbitrage Works
286
χ
CONTENTS
Where Does the Municipal Yield Curve's Steepness Come from?
292
Conclusion
2,94
Appendix: Tender Option Bonds in a Nutshell
296
CHAPTER
17
Interest Rate Swaps and Their Application to Tax-Exempt Financing
299
EricH.
Chu,
Craig Underwood, Thomas B. Fox, Jon A. McMahon,
Roger
L
Davis, Stephen A. Spitz, Albert Simons III, and George B. Wolf
What Are Swaps and How Do They Work?
300
Types of Swaps and Other Hedges
305
Uses and Benefits
311
Business Risks
315
How to Acquire a Swap
317
Legal Issues
323
Tax Issues
326
Documentation and Negotiation
333
After the Close:
Posttrade
Management
337
Appendix: Glossary of Key Terms
340
CHAPTER
19
The Regional №m: Its Customers, Traders, and Institutional Salespeople
345
Nlychele
Lindvall
Understanding "Regional"
345
Trading
347
The Regional Institutional Salesperson and Their Customers
351
The Skills of the Salesperson
353
CHAPTER
18
Changing Roles of Buyers and Sellers of Municipal Bonds:
Une
Participant's View
355
William J.
Darusmont
Communications and Technology
357
The
Legai
Opinion and Indenture of a Municipal Bond
357
The Role of Credit Agencies
358
Changes in Tax-Exempt Status
358
Pricing Transparency
359
The Buyers of Municipals
359
Sellers of Municipal Bonds
360
The Future as Prologue
362
Contents_Xi
CHAPTER
20
The Depository Trust Company and
Real-Time
Price Transparency
365
Sylvan G.
Feldstein
and David
Ratner
The Depository Trust
бе
Clearing Corporation
365
Summary
370
CHAPTER
21
i-Deal/lpreo: The Transaction Platform
373
Allen Williams
The Evolution of New-Issue Technology
373
Order Entry
374
The Issuer and Prospectus Delivery
375
The Future
375
Summary
379
PART THREE
Compliance Issues
381
CHAPTER
22
The Municipal Securities Rulemaknuj Board
383
PaulS.
Масо
and Jennifer Webster
Taf f e
Organization of the MSRB and the Scope of
Rulemaking Authority
385
Professional Qualifications, Supervision,
Recordkeeping and Compliance
386
Uniform Practice Rules
388
Municipal Market Transparency and the MSRB
390
Fair Dealing and Suitability
391
Municipal Securities Information Library
393
Market Integrity
394
Additional Information Regarding MSRB
396
CHAPTER
23
The Role of the Securities and Exchange Commission
397
Paul S.
Масо
and Cristy C. Edwards
Framework of the Federal Securities Laws
399
Application to Municipal Securities
407
Rule 15(c)2-12
420
Xii CONTENTS
CHAPTER
24
Sarbanes-Oxley and the Securities and Exchange Commission
425
PaulS.
Масо
The Act
426
Conclusion
446
CHAPTER
25
Using Auditing Techniques to Develop Investment Adviser
Compliance
Procédures
447
Kevin Reilly
Getting Started
448
Understanding the Process
448
Document the Process
453
Review the Process
454
Revise the Process Documentation
456
Summary
456
CHAPTER
26
Ride
28-7:
Legal and Research Issues for
Tax-Exempt Money Market Funds
459
Stephen A. Keen and Leslie K. Ross
Definition of a Tax-Exempt Money Market Fund
460
General Requirements of Rule 2a-7
462
Eligible Securities for Tax Exempt Funds
469
Diversification of Tax Exempt Funds Under Rule 2a-7
477
Application of Rule 2a-7 to Municipal Securities
482
Postacquisition Constraints Imposed by Rule 2a-7
496
Summary
498
PART FOUR
Fixed Income Analysis of Municipal Products
501
CHAPTER
27
Evaluation
oí
Municipal Bonds
503
Gerard Brennan
The Need for Evaluations
503
Tools of Evaluation
504
Adjusting for Different Types of Municipal Bonds
507
Contents_Xiii
Other Considerations
507
The Future of Municipal Bond Evaluation
511
CHAPTER
28
Valuation of Municipal Bonds with Embedded Options
513
Frank J. Fabozzi, Andrew Kalotay, and Michael P. Dorigan
Underlying Principles
514
Overview of Bond Valuation
514
Valuation Model
516
Specific Adjustments to the Valuation Model
for Municipal Bonds
527
Tax Adjustments to the Model
528
Horizon Price
532
Other Values Calculated from the Model
533
Relative Value Analysis of Municipal Bonds
534
Summary
535
CHAPTER
29
Analyzing and Evaluating Tax-Exempt Indexed Floaters:
Investor and Issuer Perspectives
537
Yingchen Li
Breakeven Equation for the Issuer
537
Risk Analysis of LIBOR-Indexed Floaters
538
Other Percent LIBOR-Indexed Floaters
539
Percent BMA-Indexed Floaters
540
CMS and BMS
541
Percent CMS-Indexed Structures
541
Risks of Percent CMS and Percent BMS
542
Summary
543
CHAPTER
30
Municipal Inverse floating Rate Securities
545
Cadmus Hicks
Description
545
Tax Treatment
546
Computations
547
Accounting Treatment
550
Tender Option Bonds
551
Summary
551
xiv
CONTENTS
CHAPTER
31
Analyzing Portfolios Daily
553
Paul R. Daniels
A Four-Level Framework for Portfolio Assets
554
Credit-Level Analysis
555
Basic Holding-Level Analysis
557
Total Return Performance
562
Simulations
564
Portfolio Structure: Compliance and Targets
566
Reporting
567
A Secret Formula?
567
Summary:
20
Ingredients for Success
568
снАРТшзг
Discovering Relative Value Using Custom Indices
571
Daniel
J
.
Garrett
Intuitive Patterns
571
Empirical Patterns
572
Discovery
572
Caveats and Disclaimers
575
Conclusion
575
СНАРТШЗЗ
Municipal Bond Swaps
577
Evan
С
Rourke
Description of a Bond Swap
577
Tax Swapping
577
Other Types of Municipal Bond Swaps
579
Summary
580
СНАРТШ34
The Tax Treatment of Municipal Bonds
581
Martin J.
Mauro
and Philip Fischer
Federal Tax Treatment of Municipal Bonds
581
Calculating the Effective Tax Rate on Interest Income from
Out-of-State Municipal Bonds
585
Summary
588
Contents_
XV
РАЯТП
VE
The Buy Side: Institutional Investors
589
CHAPTER
35
Managing a National Municipal Bond Fund
581
Alexander Grant
The Investor Who Buys the Fund
592
National versus State-Specific Funds
593
Total Rate of Return
594
Managing a Fund by Relative Value
595
Issues of Coupon and Structure
596
Traditional Buyers versus the Arbitrageurs
597
Conclusion
598
CHAPTER
36
Managing a High-Yield Municipal Fund
599
Wayne Godlin, Jim Phillips, Bill Black,
Barnet
Sherman,
Mark Paris, and Seth Horwitz
High-Yield Borrowers
600
High-Yield Municipal Bond Fund Track Record
601
Credit Analysis
603
Sector Allocation
603
Trading Opportunities
604
Story Bonds
606
Opportunity Bonds
607
Credit Improvement and Enhancement
607
Derivatives
608
The Use of Benchmarks
610
High-Yield Municipal Fund Infrastructure
610
Summary
611
CH
APTEK
37
Managing
Municipal Bonds
ЮТ
Property and
Casualty Insurance
Gompartes
tor Total Return
613
Karen
Szerszeń
Business of Property and Casualty Insurance Companies
613
Combined Ratio
614
Total Return versus Benchmark
616
Regulatory Factors
616
Tax Risk
618
xv¡
_
CONTENTS
Credit Risk
619
Interest Rate Risk
622
Conclusion
623
СНАРТИЗб
The Role of Hedge Funds in Me Municipal Market
625
Jonathan A. Fiebach
Ratio Curves
626
Hedge Fund Activity
628
Conclusion
631
CHAPTER
39
Managing Municipal Bond Portfolios for High-Net-Worth Investors
633
Thomas P. Dalpiaz
A Living, Breathing Human Being
633
Emotional
Ups
and Downs
634
Transparency
634
Education
634
The Starting Point
634
The Client's Existing Situation
635
Uncovering Client Objectives
636
What Is the Client Really Trying to Achieve in the
Bond Market?
636
Articulating Objectives and Setting Parameters
637
Performance Measurement
638
Uncovering Value in the Municipal Bond Market
640
Confronting Interest Rate Risk
640
Confronting Credit Risk
642
Confronting Call Risk
642
Confronting Liquidity Risk
643
Yield Curve Analysis
644
Bond Swapping
644
Using Balance in Portfolio Construction and Reconstruction
645
Portfolio Distributions
646
Municipal Bonds: A Most Necessary Investment
646
СНАРТШ40
Municipal Credit Default Swaps
647
Frank
J
.
Fabozzi
Single-Name Municipal CDS Contract
648
Contents_
XVII
Uses of Municipal CDS by Portfolio Managers
652
Second Generation of Credit Default Swaps
654
Summary
655
CHAPTER
41
Municipal Collateralized Debt Obligations
657
Rebecca Manning, Douglas J. Lucas, Laurie S. Goodman, and
Frank J. Fabozzi
CDO Basics
658
Muni CDOs
662
Summary
663
CHAPTER
42
Performance Attribution of Municipal Bonds
665
Daniel J. Garrett
Which Approach for Municipal Bonds?
666
What Doesn't Work for Municipal Bond Attribution
667
The Better Approach for Municipal Bond Attribution
670
Mathematics of Returns-Based Attribution
672
Examples of Returns-Based Attribution for Municipal Bonds
677
Client Stories: Applying Municipal Bond Attribution
684
Summary
686
PART SIX
Credit Analysis
689
CHAPTER
43
The Role of the National Federation of Municipal Analysts in
Promoting Better Disclosure
691
Lisa Good, Gerry
Lian,
Tom Weyl, Gregory A. Clark, and Gregory kikman
Summary of NFMA Initiatives
692
The Special Importance of Disclosure
693
A Detailed Look at the NFMA's Recommended Best Practices
697
Procedure for Developing RBP Documents
698
The Mechanical Steps Used to Develop an RBP Document
701
Current Issues and Challenges Facing the NFMA
702
CONTENTS
CHAPTER
44
A History of Modern Municipal Defaults
707
James E. Spiotto
Analysis of Defaults of Municipal Debt in the United States
707
Lessons Learned from Troubled Municipal Financing
719
Summary of Lessons Learned
726
Rules for Survival
727
Appendix: The Structure for Oversight and Emergency Financing
728
CHAPTffl«
New Issues in Municipal Accounting
733
Daviti
Я.
Bean and Dean Michael Mead
Structure of Governmental Financial Statements
734
Information Presented in Basic Financial Statements and RSI
735
Summary
764
CHAPTBt46
Managing a Buy-Side Municipal Bond Research
Department 767
Richard A. Diccarone
Assessment of Challenges
768
Summary
777
ШРТН47
The Role of an Activist Bond Analyst
779
Arthur
E
.
Sch/oss
Activist Bond Analyst's Approach to Improving Stressed or
Deteriorating Credits
779
Watchful Waiting
782
Asset Preservation
783
The Conference Call
783
Covenant Waivers/Consultants
784
Project Sale to External Buyer
785
The Debt Service Reserve Fund
786
Deleveraging
786
Conclusion
78
g
Contents_
Т
CHAPTER
48
How to Analyze General Obligation Bonds
789
Sylvan G.
Feldstein
and Terry
J.
Goode
The Issuer's Debt Structure and Security for
General Obligation Bonds
790
The Issuer's Budgetary Operations
796
The Issuer's Revenue Structure
801
The Economy
802
The More Important Debt Ratios
806
Conclusion
807
CHAPTER
49
Credit Worthiness of Revenue Bonds
809
Sylvan G.
Feldstein
Limits of the Basic Security
810
Flow-of-Funds Structure
810
Rate, User Charge or Dedicated Revenue and
Tax Covenants
811
The Priority of Pledged Revenue Claims
811
The Additional Bonds Test
811
Other Relevant Covenants and Issues
812
CHAPTER SO
How to Analyze Airport Revenue Bonds
813
William
£
Oliver and
Dary
I Clements
Airport Ownership Structures
813
Passenger Demand Characteristics
814
Competition
816
Use and Lease Agreements
816
Gate Control
817
Airport Management
818
Conclusion
818
CHAPTER SI
Land-Secured Bonds
821
Ronald
L
Mintz
Advantages of Land-Secured Bonds
821
General Characteristics of Land-Secured Bonds
822
xx
CONTENTS
Credit Criteria
824
Role of the Developer
832
Disclosure
"*■>
The Land-Secured Bond Market
835
Bond Structures
842
Conclusion
843
CHAPTER
52
Hospital Bond Analysis
845
Lynn
Cavallaro
National Level Overview
846
Local Level Review
850
Hospital Level Review
851
Transaction-Specific Risks
856
Examples of Hospital Downgrades
857
Conclusion
858
CHAPTER
53
861
Kurt van
Kuller
The Appeal of Single-Family Bonds
861
SF Bond Issuance Record in
2006 864
Credit Strength of SF Bonds
867
A Unique Basket of Call Options
871
Prepayments in SF Bonds
872
Municipal Prepayment Speeds
874
Other Ways of Handling Prepayments
879
PAC
Bonds
879
Discriminating between
PAC
Bonds
880
Passthroughs
881
Lockout Bonds
881
Crosscalling
882
The Ten Year Rule
884
Universal Cap Regulations
886
The Unused Proceeds Call
886
Optional Redemptions in Single-Family Bonds
888
Pricing Single-Family Bonds
889
Concluding Remarks
891
Contents_XXi
CHAPTER
54
Multifamily Bonds 893
Kurt van Kuller
Multifamily Bond Market Parameters 893
AMT
Penalizes the Sector
895
Multifamily
Supply
Outlook Positive 897
Volume
Cap Constrains Bond Issuance
897
Great Diversity of Issuers
897
Abundance of Project Types
899
Multifamily Bonds: Default Rates
901
Multifamily Default Cycles
902
An Array of Credit Enhancements
904
The Low Income Housing Tax Credit
905
FHA Insurance
905
Risk Sharing: Superior FHA Program
908
GNMA Backed Multifamily Bonds
909
Project-Based Section
8 911
FHA Section
8
Mark-to-Market
913
Section
236
Interest Subsidy
914
"Affordable Housing" Projects
915
Tax Opinion Risks
916
Multifamily Bond Redemptions
916
Prepayments in Multifamily Bonds
918
Other Call Options in Multifamily Bonds
920
Conclusion
921
CHAPTER
55
Tax-Exempt Electric Utility Debt
923
GaryM.
Meilenstein
and Paul R. Bockwoldt
Structure of the U.S. Electric Industry
925
Cost of Electricity
933
Charges for Service
934
Credit Considerations
935
Summary
939
CHAPTER 5G
How to Analyze Startup Continuing Care Retirement Community Bonds
941
EdwardC.
Meni
gait
Accommodation and Service Options
941
Residency Contracts
943
xx¡i
CONTENTS
Ownership, Governance, and Management
946
Demand Analysis of Independent Living Units
947
The Analysis of Advance Fee Deposits and
Monthly Service Fee Prices
950
Assisted Living Unit and Nursing Care Bed Demand Analysis
950
Utilization and Fill-Up Expectations
951
Financial Statement Analysis
951
Ratio Analysis
952
Legal Security Features and Covenant Considerations
953
Continuing Disclosure
954
Summary
955
CHAPTER
57
How to Analyze Tobacco Bonds
957
Gerry
Lian
Background
957
Analysis of Structural Risk
964
Analysis of Corporate Credit Risk
965
Analysis of Cash Flow Risk
968
Analysis of Litigation Risk
971
Conclusion
978
CHAPTER
58
Toll Road Analysis
981
Robert
И.
Muller
History
981
Key Analytical Factors
984
Conclusion
993
CHAPTERS
Water and Sewer Bond Analysis
995
Brian Winters
Structure
996
Management
997
Economic Base
997
Financial Ratios
998
Bond Security
1000
Environmental Issues
1002
Other Considerations
1002
Conclusion
1002
Contents_xxiii
РАЯТ
SEVEN
Special Security Structures and Their Analysis
1005
CHAPTER BO
Evaluating Tax-Exempt Commercial Paper
1007
Maria C. Sazon
Overview of Commercial Paper
1007
Repayment of Commercial Paper Notes
1008
Analyzing Various Sources of Repayment for
Commercial Paper
1009
Analyzing Commercial Paper without Enhancement
1011
Summary
1012
CHAPTER
61
The Use of Letters-of-Credit in Connection with Municipal Securities
101
б
Todd P. Zerega
Overview of LOCs
1016
Considerations in Reviewing a LOC-Backed Security
1019
Conclusion
1023
CHAPTER G2
How to Analyze Tax, Bond, and Grant Anticipation Notes
1025
Sylvan
6. Feldstein
and Frank J. Fabozzi
Two Major Purposes of Notes
1025
Security Behind Tax and Revenue Anticipation Notes
1026
Information Needed Before Buying Tax or
Revenue Anticipation Notes
1027
Summary
1029
CHAPTER
63
How to Analyze Refunded Municipal Bonds
1035
Sylvan
ß. Feldstein
Pure versus Mixed Escrow Funds
1035
What are the Reasons for Refundings?
1036
Two Types of Refunded Bonds
1037
Determining the Safety of the Refunded Bonds
1038
XXIV CONTENTS
CHAPTER
64
Pollution Control Revenue, Industrial Development Revenue, and
Conduit Financing Bonds
1041
Gary Krellenstein
Security
1042
Restrictions on Issuance and Refunding of PCR/IDR Debt
1044
Call Features
1047
Summary
1048
CHAPTER
65
How to Analyze FHA-lnsured Mortgage Hospital Bonds
1049
Sylvan B.
Feldstein
FHA Hospital Mortgage Insurance
1050
Credit Risk
1051
The "Prudent Man" Evaluation Approach
1053
Summary
1054
CHAPTER
66
How to Analyze Higher Education Bonds
1
05S
Bradley
D
.
Minoke
The Institution
1056
Use of Bond Proceeds
1057
Security
1058
Degrees and Programs
1060
Student Demand
1060
Management and Governance
1064
Faculty and Staff
1065
Tuition and Financial Aid
1066
Financial Statements
1067
Endowment Funds
1072
Plant and Facilities
1073
Fundraising Abilities
1074
Definitions of Certain Terms
1074
Continuing Disclosure
1074
Conclusion
1075
Contents_
XXV
CHAPTER
67
Analyzing Human Service
Provider
Bonds
1077
Ruben
Selles
Milestones in the Development of Human Service Providers
1078
Risk Factors Associated with Human Service Providers
1081
Summary
1083
CHAPTER
68
How to Analyze the Municipal Bond Insurers
and the Bonds They Insure
1085
Donald King
С
Ml
lo
What Is Municipal Bond Insurance?
1085
Municipal Bond Insurance Benefits
1087
Additional Benefits of Bond Insurance
1089
Types of Municipal Bond Insurance
1090
Municipal Bond Insurance Providers
1091
Other Municipal Bond Insurance Providers
1092
Reinsurance
1093
Telling the Difference
1094
Financial Factors
1096
Other Financial Factors
1097
Other Businesses
1098
Conclusion
1099
CHAPTER
68
Student Loan Financing: Risk Evaluation Tax-Exempt and
Taxable Markets Converge
1101
Diane R. Maurice andAnkur Goyal
Tax-Exempt Issuers and Privatization Trends
1103
Systemic Shift-Risk Transference
1107
Guaranteed versus Private Loans
1108
Risk Profile Evolves
1109
Summary
1109
Appendix: Recent Investigatory and Legislative Developments
1111
CHAPTER
70
Analysis of
Tribal
Casino Bonds
1118
Megan Neuburger, Michael
Paladino,
Jessalynn Mom, and David Litvack
Issuer Credit Factors
1120
Bond Structure and Security Features
1126
Summary
1128
XXVi
_CONTENTS
CHAPTER
71
Understanding Variable Rate Demand Obligations
1129
Mitchell Savader
How VRDOs Work
1129
The Need for Cash
1130
The Role of Bond Insurance
1131
CHAPTER
State Credit Enhancement Programs for
School Districts and Municipalities
1133
Harold B. Burger
Types of State Credit Enhancement Programs
1134
Assessing State Credit Enhancement Programs
1135
Credit Enhancement Program Advantages and Disadvantages
1136
Summary
1139
CHAPTER
73
The ABCs of Charter Schools
1141
Mitchell Savader
Understanding Charter Schools
1141
The Charter
1142
The Relationship between Demand and Financial Success
1144
Summary
1146
CASE STUDES DFINOVATJVE AND OTHffi SECURITY STRUCTURES
CASE STUDY
1
New York City Uses Taxable Municipals After
9/11
for
Budget Itetof and Affordable Housing
1149
Emily A. Youssouf
CASE STUDY
2
9/11,
Subprkne Loans, and the Magnofta Park Apartments Bond Default
1153
Michael
J
.
Ross
CASE STUDY
3
Newport News Issues an Energy Savings COP
1191
A. Theodore Palatucci
Contents_
XXVii
CASE STUDY
4
Tax-Exempt Airport Finance: Tales from the Friendly Skies
1165
James E. Spiotto
CASE STUDY
S
Toronto's Highway
407 1185
William E. Oliver
CASE STUDY
6
Disney's California Adventure and Tax-Exempt Bonds
1191
Hilary E.
Feldstein
CASE STUDY
7
Super Bowl
XXXII
Helps Resolve Bond Default
1195
Bill
Ни с к
CASE STUDY
8
A Tax-Exempt Prepay Natural Gas Purchase Bond
1201
Sandra McDonald
CASE STUDY
9
Universal Studios Road Financing:
Hrst
with Special Assessment
Bonds and Second with Tax Increment financing Bonds
1207
Hilary
E
. Feldstein
CASE STUDY
10
California's Workers' Compensation msurance Crisis and the
financing of the California Insurance Guarantee Association
1211
Anthony H. Fisher
CASE STUDY
11
Dreamworks Tries to Issue Tax-Exempt Bonds
1215
RichSaskal
XXViÜ
_CONTENTS
CASE STUDY
12
Financings of the Medical University Hospital Authority
of South Carolina
1217
Joseph A. Spiak
CASE STUDY
13
Niagara Falls Memorial Medical Center
1223
Herman R. Charbonneau
CASE STUDY
14
Aruba
Airport Authority Airport Revenue Bonds
1227
William E. Oliver
CASE STUDY
15
Yankees versus
Mets: A
Subway Series
1233
Mitchell Savader
CASE STUDY
16
Good Swap, Bad Swap
1237
Peter Shapiro
CASE STUDY
17
Westminster-Canterbury of the Blue Ridge
Continuing Care Retirement Community
1241
Marie S. Pisecki
CASE STUDY
18
Preserving Housing Affordability with Taxable Municipals
1249
Emily A. Youssouf
CASE STUDY IS
Massachusetts Sells LffiOR Index General Obligation Bonds
with an Interest Rate Swap
1253
Sylvan G.
Feldstein
and Patrick Landers
Contents_XXiX
CASE STUDY
20
Developing Hudson Yards with a
$2
Billion Bond Issue
1257
James McSpiritt
CASE STUDY
21
Seminoie iride
Bets on Taxability
1263
Joseph
Krist
APPENDIX A
A Pictorial History of Municipal Bonds
1269
Sylvan G.
Feldstein
and Peter O'Brien
APPENDIX
В
Glossary of Terms
1291
Mitchell Savader
Index
1297 |
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| illustrated | Illustrated |
| index_date | 2024-07-02T18:42:32Z |
| indexdate | 2024-07-09T21:07:05Z |
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| isbn | 9780470108758 |
| language | English |
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| spelling | Handbook of municipal bonds Sylvan G. Feldstein ; Frank J. Fabozzi, [eds.] Hoboken, NJ Wiley 2008 XLIV, 1332 S. graph. Darst. txt rdacontent n rdamedia nc rdacarrier The Frank J. Fabozzi series Finanzwirtschaft Finance, Public Municipal bonds Kommunalobligation (DE-588)4164798-1 gnd rswk-swf USA (DE-588)4078704-7 gnd rswk-swf (DE-588)4143413-4 Aufsatzsammlung gnd-content USA (DE-588)4078704-7 g Kommunalobligation (DE-588)4164798-1 s DE-604 Feldstein, Sylvan G. Sonstige oth Fabozzi, Frank J. 1948- Sonstige (DE-588)129772054 oth Digitalisierung UB Regensburg application/pdf http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=016033201&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA Inhaltsverzeichnis |
| spellingShingle | Handbook of municipal bonds Finanzwirtschaft Finance, Public Municipal bonds Kommunalobligation (DE-588)4164798-1 gnd |
| subject_GND | (DE-588)4164798-1 (DE-588)4078704-7 (DE-588)4143413-4 |
| title | Handbook of municipal bonds |
| title_auth | Handbook of municipal bonds |
| title_exact_search | Handbook of municipal bonds |
| title_exact_search_txtP | Handbook of municipal bonds |
| title_full | Handbook of municipal bonds Sylvan G. Feldstein ; Frank J. Fabozzi, [eds.] |
| title_fullStr | Handbook of municipal bonds Sylvan G. Feldstein ; Frank J. Fabozzi, [eds.] |
| title_full_unstemmed | Handbook of municipal bonds Sylvan G. Feldstein ; Frank J. Fabozzi, [eds.] |
| title_short | Handbook of municipal bonds |
| title_sort | handbook of municipal bonds |
| topic | Finanzwirtschaft Finance, Public Municipal bonds Kommunalobligation (DE-588)4164798-1 gnd |
| topic_facet | Finanzwirtschaft Finance, Public Municipal bonds Kommunalobligation USA Aufsatzsammlung |
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