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RESOLUTION N0. 82-92 <br />INTRODUCED BY: Mayor Beebe & Council as a Whole <br />A RESOLUTION URGING THE CONGRESS OF THE <br />UNITED STATES TO DELAY IMPLEMENTATION OF <br />THE TAX EQUITY AND FISCAL RESPONSIBILITY <br />ACT OF 1982 AS IT PERTAINS TO THE REQUIRE- <br />MENT THAT EFFECTIVE JANUARY 1, 1983 ALL NEW <br />MUNICIPAL BONDS MUST BE ISSUED IN REGISTERED <br />FORM TO RESERVE THEIR TAX EXEMPT STATUS. <br />WHEREAS, the Congress of the Uni.ted States recently enacted <br />the Tax Equity and Fiscal Responsibility Act which provides, in <br />part, that most municipal securities issued after December 31, <br />1982 must be issued solely in registered form to preserve their <br />tax exempt status; and <br />WHEREAS, these provisions will necessitate significant changes <br />in the practices of all participants in the municipal securities <br />market to include the municipal securities industry, the issuer <br />community and investors in municipal securities; and <br />WHEREAS, if these provisions are implemented on January l, 1983, <br />due to time constraints, the ability of municipalities to borrow much <br />needed funds by the issuance of municipal bonds will be greatly <br />reduced or possibly completely halted since: <br />1) Numerous?State 1aw requirements must be <br />changed to permit the issuance of registered bonds, <br />to permit the use of a local official as a transfer <br />agent, to permit the maintenance of an in-state <br />registry, to permit a confidential bond holder's list, <br />to permit a book-entry accounting system, to permit <br />contractual arrangements with registered transfer agents <br />and any other necessary changes to comply with the new <br />federal 1aw; and <br />2) Necessary time-consuming changes to bond <br />issuance procedures will have to be developed by <br />municipalities, many of which will greatly increase <br />their costs; and <br />3) Municipal market participants have expressed <br />the view that the generalized adoption of book-entry <br />or immobilized delivery systems would help solve the <br />problems of clearing registered municipal_securities <br />and it would be virtually impossible to establish such <br />a system by January 1, 1983; and <br />4) The Secretary of the Treasury has not yet <br />adopted rules and regulations to implement the <br />registration provisions and many questions remain <br />unanswered; and