Back to Publications

Tax-Exempt Issuers and Borrowers Need Written Post-Issuance Compliance Policies

ARE YOU A NON-PROFIT OR GOVERNMENTAL ENTITY WITH OUTSTANDING TAX-EXEMPT BONDS? ARE YOU CONSIDERING FINANCING A PROJECT USING TAX-EXEMPT BONDS? IF SO, YOU SHOULD HAVE A WRITTEN “POST-ISSUANCE COMPLIANCE POLICY” IN PLACE.

The status of an issuer or borrower as a governmental or 501(c)(3) entity, while often a prerequisite, is not itself sufficient to achieve the benefits of tax-exempt financing. Rather, there are many requirements for bonds to qualify as tax-exempt. Much effort is put into the initial structuring and documentation of an issuance of tax-exempt bonds to ensure that the bonds comply with the rules governing tax-exempt debt. Such rules include restrictions on how the borrowed funds can be used and invested, deadlines for spending the borrowed funds, and certain recordkeeping and reporting requirements.

To view the full text of this article, please open the PDF.

Publication Content