We are excited to share our new quarterly newsletter! We listened to the feedback so many of you offered in our Client Engagement Survey earlier this year – the need for stories directly relating to the work you do, more case studies, and the ability to self-select the articles you’d like to read – and hope you find this new format valuable.
It’s that time of year”¦and I’m not talking about the holidays! It’s the time when school district revenue calculations are complete and property tax levies are nearly finalized; it’s also the time when counties begin mailing tax information to property owners. The annual confluence of these two activities usually results in some level of taxpayer confusion and questioning.
In a rising interest rate environment, your ability to drive capital projections toward completion may prove more challenging! The political appetite for taking on more debt to fund municipal projects may have dwindled and the narrative may have shifted more toward reducing debt burden. This scenario presents an opportunity consider alternative strategies.
While the current interest rate environment is far more hospitable to producing substantially higher investment income for longer periods of time, those higher rates come with other, undesirable consequences. In this case, the good far outweighs the bad.
Rising interest rates on investments are most certainly welcome for communities investing bond proceeds. However, as is the case with most good things, a new set of challenges are introduced. For issuers of tax-exempt bonds, these challenges can largely be summed up in a single word: arbitrage.
To say a lot has changed in the bond market this year would be a major understatement”¦changes that can largely be attributed to the actions taken by the Federal Reserve to combat persistent inflation.
A pioneer and regional leader in municipal advisory services since 1955, Ehlers helps clients build strong, vibrant and sustainable communities by delivering independent, integrated advice across all areas of public finance. We work with more than 1,500 local governments, schools, and public agencies across five states; placing our clients’ needs and best interests at the center of everything we do.