Municipal Advisory Council of Michigan. MACT 2018 Bay City Summer Conference

Transcription

1 Municipal Advisory Council of Michigan A Not-for-Profit Membership Service Corporation MACT 2018 Bay City Summer Conference Public Finance Disclosure Risk Analysis Essential Debt Reports Capital Market Support Municipal Bond Sales Newsletters Seminars Serving Michigan s Municipal Credit & Capital Markets Alfred V. Diebel, Executive Director

2 Remember Our History: 1929 Property values steeply declined and tax collections plummeted. Numerous counties, cities, villages and schools in Michigan defaulted on bond payments in the 1930s. There was no mediator or agency to resolve conflicting interests of the municipal issuers and creditors. State bond laws, subject to multiple interpretations compounded confusion forcing resolutions in the court system. 2

3 The Early MAC History An initial volunteer council of bankers and accountants convened monthly to assist schools, counties, townships and cities. Between 1931 and 1933, the MAC s Meeting Minutes refer to more than 30-SE Michigan municipal issuers in financial distress. Initial representation included: Broker-Dealers Banks Trust Departments Insurance Companies MAC incorporated as a not-for-profit member association in MAC counseled municipalities on how to improve their business operations (advisory services ceased in the early 60s.) Over a 10-year period, MAC purchased and restructured numerous bonds and notes issued by counties, cities, villages and schools. 3

4 MAC s Mission To promote sound principles of municipal financing and administration and to assist municipalities and bond holders in protection of credit and payment of such securities. Incorporation papers, October 3,

5 MAC Michigan The Beginning Together banks, broker-dealers, and trust companies established the MAC to: Centralize information regarding municipal bond defaults and to act as a bridge between interested parties. Clarify creditor and debtor legal and financial problems that were so common in the Great Depression. Directly advise municipalities on how to improve budgeting and financial management. Al Diebel, Executive Director, MAC Michigan 5

6 Who We Are: The MAC Today We foster efficient investment banking, underwriting, trading and sales as it relates to municipal debt. Located in Detroit, the Municipal Advisory Council of Michigan is a non-profit membership corporation. The MAC has 49 member firms. The MAC collects, records, and distributes information important to fundamental credit analysis, disclosure, and credit monitoring. Membership includes any business engaged in the Michigan public finance credit and capital markets where municipal debt is issued by Michigan and its local units of government. 6

7 Who the MAC Serves MAC serves as a bridge between municipal credit and capital market participants. The MAC constituency includes: Broker-Dealers & Commercial Banks Investment Advisors Registered/Independent Law Firms Michigan Department of Treasury Rating Agencies Certified Public Accountants Financial/Municipal Advisors Specialized Service Firms 7

8 What MAC does At a Glance The MAC strives to be the single-source municipal database for essential bond and note details for all local government issuers in Michigan. Track, monitor and record all new issue bond sales: Competitive public sales Negotiated public sales Private placements As a neutral venue for competitive sales, our forward calendar facilitates bidding by broker-dealers and banks. We receive bids by fax, or in-person. A validation of the TIC is provided. IPREO/Parity is a MAC Business Partner, using MAC Reports and our published results of sales. 8

9 What MAC does At a Glance (cont d) The MAC database contains more than 10,850 active bond series that include details such as coupons, yields, principal structure and terms. Our Specialists pull data directly from official statements, audited financial statements, continuing disclosure reports and other sources. We track and store financial operating data, K-12 enrollments, millage rates and taxable valuations. Issuers use the MAC s data reports to comply with SEC Rule 15c2-12 continuing disclosure covenants. My normal protocol is to use the MAC reports first and foremost on almost all my deals. January 2018 Thomas D. Colis, Esq., Bond & Underwriters Counsel Miller Canfield Paddock & Stone, Detroit, MI 9

10 Michigan Bond Issuance 2018 v Total Par Amounts Volume Par Amounts Volume Par Amount Difference Volume Difference January $85,007, $632,521, $547,514,000-7 February $526,127, $758,388, $232,261,000-5 March $543,794, $256,824, $286,969, April $247,937, $240,032, $7,904,935-4 May $574,560, $610,482, $35,921, June $779,799, $882,459, $102,660, July $298,711, $65,085, $233,626,000 7 New-Money $2,445,168, $2,022,875, $422,292, Refunding $610,767, $1,422,916, $812,149, Competitive $684,050, $695,505, $11,455, Negotiated $1,933,704, $2,346,788, $413,084,646-5 Private Placements $111,875, $163,357, $51,481, Michigan Finance Auth. $326,306, $240,141, $86,164,935 4 General Obligation $1,891,518, $2,470,061, $578,543, Revenue $1,164,417, $974,364, $190,052, Special Assessment $0 0 $1,366, $1,366,000-3 Certificate of Participation $0 0 $0 0 $0 0 Installment Obligation $0 0 $0 0 $0 0 Other Exempt $0 0 $0 0 $0 0 State Goverment $0 0 $0 0 $0 0 State Agencies $702,800,000 9 $137,065,000 2 $565,735,000 7 MDOT $0 0 $0 0 $0 0 County $129,010, $545,358, $416,348,000-9 City $308,242, $565,965, $257,723, Township $71,252, $49,608, $21,643,935-8 Village $28,234, $33,405, $5,171,000 2 School District/ISD $1,233,401, $1,383,025, $149,623,439-9 All Colleges $488,570, $649,570, $161,000,000 5 Authority $0 0 $0 0 $0 0 Waste, Water & Sewer, and Drainage District $87,026, $62,985,000 7 $24,041,000 5 Other $7,400,000 2 $18,810, $11,410,000-1 Totals: $3,055,935, $3,445,791, $389,856,

11 Other MAC Services Access To Municipal Leaders The MAC, located in downtown Detroit is a neutral forum bringing together banking and investment leaders across the municipal bond and credit market spectrum. Educational Seminars Covering important topics, e.g. SEC updates for municipal advisors, banking, legal and investment professionals, and communities. MAC Forward Sales Calendar A comprehensive list of scheduled Michigan municipal competitive and negotiated bond and note sales. MAC Newsletter Covers local and national topics of interest to the Michigan public finance community. 11

12 Website Data : Members Only Members access MAC information to: Gather an Issuer s most current direct debt, overlapping debt, indirect debt, taxable valuations and operating data. Support an Issuer s bond rating requests. Enable commercial banks to competitively bid to buy debt obligations in support of depository relationships. Research Issuer s outstanding bonds to evaluate refunding opportunities and structure new money. Enable monitoring of current credit data for portfolio performance, regulatory and compliance documentation. Did You Know? The MAC is the primary Source of Michigan Municipal Issuer direct, overlapping and indirect debt disclosures used in Official Statements. 12

13 Muni Data for Member Analysis, Disclosures & Underwriting The MAC provides 23 credit and data reports for members. For 2017, out of 23,663 Member downloads, the top-10 reports were: Top Ten Report Titles 2017 Frequency Direct Debt Bond Maturity Report 7,093 Direct Debt Summary 5,142 MAC Key Report 4,036 Overlapping Debt Report 2,160 Issuer Indirect Debt Report 1,686 Issuer Debt Statement 1,022 Direct Debt Complete Bond Reports 952 MAC Report 635 Revenue Coverage Report County Debt Report 134

14 Website: Sample Data Reports 14

15 Website: Sample Data Reports Icons take Users to linked documents, e.g. an Official Statement 15

16 Website: Sample Data Reports Linked documents remain available for 60-days after the User saves the Key Report. 16

17 Website: Sample Data Reports The MAC creates a unique overlapping debt report to fully disclose multijurisdiction debt. 17

18 MAC s Website: MAC Member Report Downloads ,000 11,952 10,000 8,000 6,000 4,000 2,000-2,086 5,311 1,235 1, Total Reports: 23,663 I always access an Issuer s MAC Report to help describe a bond issue when I speak with my Institutional Investor clients. Member, Michigan-Based Institutional Registered Representative Winter

19 Utilizing MAC Municipal Web Site The following slides are designed to introduce and guide the Municipal User to access and use the MAC s specialized and valuable Debt Reports. Al Diebel, Executive Director, MAC-Michigan 19

20 Utilizing MAC Municipal Web Site The MAC has a specialized website portal just for local units of government: Cities, townships, school districts and more use the MAC s Reports for CAFRs and Audited Financial Statements. An easy-to-use menu and interface for visitors. Reports focus on direct, indirect and overlapping debt. Unique debt service reports and detail intended for your audited financial statement s Notes. Al Diebel, Executive Director, MAC-Michigan 20

21 Utilizing MAC Municipal Web Site Navigate your internet browser to WWW. Macmuni.com Jackson County is an illustration for easy Log-In steps. Al Diebel, Executive Director, MAC-Michigan 21

22 Utilizing MAC Municipal Web Site Congratulations: A successful log-in! Al Diebel, Executive Director, MAC-Michigan 22

23 Utilizing MAC Municipal Web Site Easy to navigate menu to select your required reports. Al Diebel, Executive Director, MAC-Michigan 23

24 Utilizing MAC Municipal Web Site Debt Summary itemizes each series of direct debt, disclosing original and net amounts. Al Diebel, Executive Director, MAC-Michigan 24

25 Utilizing MAC Municipal Web Site Many units of gov t overlap the County s taxpayers. Al Diebel, Executive Director, MAC-Michigan 25

26 Utilizing MAC Municipal Web Site Numerous series of bonds are listed in the debt summary Al Diebel, Executive Director, MAC-Michigan 26

27 Utilizing MAC Municipal Web Site The aggregate long-term debt service can be used for disclosure in the Notes of the audited financial statements. Al Diebel, Executive Director, MAC-Michigan 27

28 Utilizing MAC Municipal Web Site Each outstanding series can be viewed, proofed and used for budgeting and forecasting. Al Diebel, Executive Director, MAC-Michigan 28

29 Utilizing MAC Municipal Web Site Your Debt Reports are used in conjunction with Continuing Disclosure Agreements, municipal advisory services, rating agency surveillance, investment managers, capital improvement planning, audited financial statements and CAFRs. Sign-up to access your Debt Reports at the MAC. Annual fee of $100 for unlimited access to the Reports. Call, or leave your contact information with us, today. Phone: Al Diebel, Executive Director, MAC-Michigan 29

30 MAC and Michigan Department of Treasury Michigan Department of Treasury partners with the MAC to provide accurate and timely local debt information and utilizes the MAC s valuable reporting tools for research and analytical purposes. Eric Scorsone, PhD, Senior Deputy State Treasurer (past) Michigan Department of Treasury Bureau of Local Government February 2018 Al Diebel, Executive Director, MAC-Michigan 30

31 In closing: MAC of Michigan Provides credit and capital market resources supporting: Robust Michigan municipal bond underwriting and banking. Performance of record keeping and reports which otherwise are not provided in Michigan. Issuer transparency, full disclosure and in-depth credit analysis. Efficient markets and investor liquidity. Fosters and supports Michigan s Municipal Issuers with: Wider and greater access to credit. Continuing disclosure and investor knowledge. Enhancing opportunities to raise capital at the lowest interest cost given prevailing market conditions. Al Diebel, Executive Director, MAC Michigan 31

32 MAC: Board of Trustees The MAC Staff report to a seven member Board of Trustees selected by and from the Membership. Current Board Members include: Chairman Paul Stauder, Public Financial Management, Inc. Secretary Geoff Kobayashi; Fifth Third Securities Treasurer Rebecca Gersonde; Heber, Fuger & Wendin Trustees Christina Webb; Raymond James & Associates Cindy Higgins; Comerica Securities Joel Piell, Esq.; Miller Canfield Paddock and Stone Brodie Killian; Stifel Nicolaus 32

33 MAC: Leadership & Staff Executive Director Alfred V. Diebel Director of Information Technologies Sean Fulcher Municipal Finance Data Specialists Syvette Donald Bernadette Klinko Debbie Prunkard Address: 535 Griswold, Suite 1850 Detroit, MI Phone: Website: 33

34 Thank you! Al Diebel, Executive Director, MAC-Michigan 34