Minneapolis, MN | September 24, 2021 | Blue Rose Capital Advisors
By: Georgina Walleshauser, Associate
With the U.S. fiscal year ending on September 30th when government funding is set to expire, there has been increased pressure to extend funding. On Tuesday, the House of Representatives passed a bill in hopes to prevent a government shutdown resulting from this upcoming deadline and allow for government funding through December 3rd. The bill also addresses the debt ceiling for the United States, which, as we know was set on July 30th of this year and has resulted in the suspension of subscribing for State and Local Government Securities (SLGS).
It is estimated that the federal government would be unable to pay its bills as early as October this year, although that date is still uncertain and may extend until later in the month according to Treasury Secretary Janet Yellen. The potential inability to pay its debt creates tremendous pressure to allow for the government to resume incurring additional debt. Nevertheless, the press has speculated that it would be extremely difficult to have the bill passed as is, given all that it includes.
The bill would still need to be passed by the Senate and signed by the President. If passed as is, the bill would suspend the debt limit and allow for the subscription of SLGS by municipal issuers through December 16, 2022. If it is not passed, the SLGS window will remain closed until such time as an alternate bill is passed and ratified. Until then, open market securities serve as a viable alternative, and often more cost-effective alternative to SLGS.
To determine whether or not this may be the case for your escrow, please contact your Blue Rose advibasis-points-when-will-the-slgs-window-reopensor.
Meet the Author:
Georgina Walleshauser, Associate
Megan Roth, Marketing