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The Qualified School Construction Bonds Questionnaire

In April 2012, TEB initiated a questionnaire project to evaluate the compliance and record retention policies, procedures, and practices of 111 issuers of qualified school construction bonds (QSCBs).  TEB sent letters notifying selected issuers of the project as well as instructions for accessing and completing the online questionnaire.  Paper copies of the QSCB questionnaire are not available.

The questions in the online questions are reproduced below.  Due to space limitations, there are no response choices shown.
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PART I   Current Debt Management Policies and Procedures

        Q1(a)  Who first raised with you the possibility of issuing QSCBs?
 
        Q1(b)  What approvals are required for your issuance of QSCBs?

        Q1(c)  Do you have procedures in place -- regardless of whether they are written -- to review the structure of your QSCBs prior to
                    issuance?

        Q1(d)  If Yes, are any of those procedures written?

        Q1(e)  Do your written procedures for reviewing the structure of your QSCBs prior to issuance ensure that:
  
                        (i)  the proposed bond issuance will qualify for tax-advantaged status pursuant to applicable federal tax law;
                       (ii)  the proceeds of the proposed bond issuance will be used only for construction, rehabilitation, or repair of a public school 
                             facility or for acquisition of land on which a public school facility is to be constructed;
                      (iii)  the proceeds of the proposed bond issuance will be spent within three years of the date of issuance; and
                      (iv)  the issuance costs financed by the proposed bond issue will not exceed two percent of the proceeds of the proposed
                             issue?

        Q1(f)  With respect to the procedures you reported in Part I, Questions 1(c)-1(e) -- regardless of whether they are written -- indicate the
                   earliest date that any of the procedures were first implemented?

        Q1(g)  With respect to the procedures you reported in Part I, Questions 1(c)-1(e) -- regardless of whether they are written -- indicate the
                    most recent date that any of the procedures were revised?

PART II   Volume Cap Allocation Policies and Procedures

        Q2(a)  For purposes of receiving a QSCB allocation, which one of the following three choices best describes you:
  
                         (i)  an entity identified as a Large Local Education Agency in Section 4 of Notice 2009-35 or in Section 3 of Notice 2010-17;
                        (ii)  an Indian Tribal Government; or 
                       (iii)  an Issuer that is not a Large Local Education Agency or an Indian Tribal Government?

        Q2(b)  If you are a Large Local Education Agency, do you have procedures in place -- regardless of whether they are written --
                    to reallocate or carryover any unused QSCB volume cap allocation you received?

        Q2(c)  Are any of those procedures written?

        Q2(d)  Identify the specific information required as part of the application for a portion of the State’s allocation of QSCB volume cap.

        Q2(e)  Does the State charge any fees in connection with the application for a portion of the State’s allocation of QSCB volume cap?

        Q2(f)  Does the State distinguish among different purposes for QSCBs (for example, construction or repair) when deciding whether to
                   grant or deny an application for a portion of its allocation of QSCB volume cap?
         
        Q2(g)  What is the basis to distinguish among different purposes for QSCBs?

PART III   Current Procedures Related to Determining Issue Price

        Q3(a)  Do you have procedures -- regardless of whether they are written -- for determining the issue price for your QSCBs?
       
        Q3(b)  Are any of those procedures written?

        Q3(c)  Under those procedures, how do you determine the issue price for your QSCBs? 
       
        Q3(d)  With respect to the procedures you reported in questions 3(a)-3(c) -- regardless of whether they are written -- indicate the earliest
                     date that any of the procedures were first implemented.
       
        Q3(e)  With respect to the procedures you reported in questions 3(a)-3(c) -- regardless of whether they are written -- indicate the most 
                    recent date that any of the procedures were revised.
       
        Q3(f)  Are records of trading activity for your QSCBs available through the Municipal Securities Rulemaking Board’s Electronic Municipal
                   Market Access System (see www.emma.msrb.org)?
       
        Q3(g)  Did you or a consultant to the issuer (NOT the underwriter or initial purchaser) review the records of the trading activity for your 
                    QSCBs?
       
        Q3(h)  Did you receive a written analysis of trading activity for your QSCBs?

        Q3(i)  Did the written analysis of trading activity for your QSCBs include an analysis of the pricing?

PART IV   Current Record Retention Procedures

        Q4(a)  In what form do you maintain records supporting the tax credit status of your QSCBs?
       
        Q4(b)  Do you have procedures -- regardless of whether they are written -- regarding maintenance of records supporting the tax credit
                    status of your QSCBs?
       
        Q4(c)  Are any of those procedures written?
       
        Q4(d)  What records do these procedures require you to maintain copies of?
      
        Q4(e)  With respect to the procedures you reported in questions 4(b)-4(d) -- regardless of whether they are written -- indicate the
                    earliest date that any of the procedures were first implemented.

        Q4(f)  With respect to the procedures you reported in questions 4(b)-4(d) -- regardless of whether they are written -- indicate the most 
                   recent date that any of the procedures were revised.

PART V   Post-Issuance Compliance Procedures

        Q5(a)  Do you have procedures (other than the bond documents provided at closing) to monitor compliance with federal tax
                    requirements during the term of the bonds and to ensure that noncompliance is timely identified and corrected?
       
        Q5(b)  If yes, are any of those procedures written?

        Q5(c)  What controls are included in those procedures?

        Q5(d)  With respect to the procedures you reported in questions 5(a)-5(c) -- regardless of whether they are written -- indicate the earliest
                    date that any of the procedures were first implemented.

        Q5(e)  With respect to the procedures you reported in questions 5(a)-5(c) -- regardless of whether they are written -- indicate the most
                    recent date that any of the procedures were revised.

PART VI   Current Awareness of Voluntary Compliance Options

        Note: The questions in Part VI relate to your awareness of voluntary compliance options generally available for all types of 
        tax-advantaged bonds.

        Q6(a)  Are you aware of the following options available for voluntarily correcting failures to comply with post-issuance federal tax 
                    compliance requirements:

                         (i)  taking remedial actions to redeem or defease nonqualified bonds pursuant to the Income Tax Regulations; or 
                        (ii)  entering into a closing agreement under the Tax Exempt Bonds Voluntary Closing Agreement Program (more 
                               information available here). 

        Q6(b)  Are you aware that under the Tax Exempt Bonds Voluntary Closing Agreement Program your settlement amount will be reduced
                     if you have written procedures in place to monitor compliance with federal tax requirements during the term of the bonds 
                    and to ensure that noncompliance is timely identified and corrected?

 


  

 

 

Page Last Reviewed or Updated: 07-Apr-2014