Municipal News & Jobs

The Federal Reserve on Wednesday raised its benchmark interest rate by a quarter percentage point and gave little indication that it is nearing the end of this hiking cycle. Aligning with market expectations, the rate-setting Federal Open Market Committee boosted the federal funds rate by 0.25 percentage point. That takes it to a target range of 4.5%-4.75%, the highest since October 2007. The move marked the eighth increase in a process that began in March 2022. … The post-meeting statement noted that inflation “has eased somewhat but remains elevated,” a tweak on previous language. Markets, however, were looking to this week’s meeting for signs that the Fed would be ending the rate increases soon. But the statement provided no such signals. Stocks sold off in the wake of the announcement, with the Dow Jones Industrial Average tumbling more than 300 points.
Source: CNBC

The interest rate table above illustrates recent changes in a sample of MBIS “investment grade” yields. Every issuer’s credit is different. For rates that may be applicable to your municipality, contact our Municipal Bond Advisors, Larry Kleeman, Beth Warren and Henry Schmidt.

The interest rate table above illustrates recent changes in a sample of MBIS “investment grade” yields. Every issuer’s credit is different. For rates that may be applicable to your municipality, contact our Municipal Bond Advisors, Larry Kleeman, Beth Warren and Henry Schmidt.

U.S. central bankers have unambiguously telegraphed this week’s policy decision: a quarter-of-a-percentage-point increase in their benchmark interest rate, the smallest since they kicked off their tightening cycle 10 months ago with one the same size. Less clear is whether they will continue to signal “ongoing increases” ahead for the policy rate as evidence mounts that inflation and the economy are both losing momentum. The Federal Reserve has included that phrase in every policy statement since March 2022, when officials had just started raising borrowing costs from near zero and wanted to signal there was a lot more tightening ahead. The rate increase expected at the Federal Open Market Committee’s Jan. 31-Feb. 1 meeting would bring the policy rate to the 4.5%-4.75% range. That’s two quarter-point rate hikes short of the level most Fed policymakers in December thought would be “sufficiently restrictive” to bring inflation under control. “Does the word ‘ongoing’ really capture just two more hikes? It’s a close call,” said III Capital Management’s Karim Basta. At the same time, he said, “there’s going to be some caution” about doing anything that could feed market expectations that a pause in rate hikes is imminent.
Source: Reuters

Billions in federal funding could be the catalyst that finally returns to Kansas passenger rail service to Texas, advocates and transportation officials told a Kansas legislative caucus Monday. … For years, passenger rail advocates have pushed for Amtrak and federal railroad officials to support expansion of the line up to Wichita and Newton, the latter of which would be a connection to the Southwest Chief. But years of stagnant ridership and federal funding for Amtrak had kept expansion at the conceptual level. However, as part of the $1.2 trillion Infrastructure Investment and Jobs Act, federal lawmakers allocated $66 billion to passenger and freight train improvements over the next five years.
Source: CJonline

A few weeks ago, I wrote an article about property taxes and quoted author Adora Svitak who said, “The first thing anyone can do about any issue is get informed.” I chose this quote for two reasons: Property tax is the most criticized and misunderstood source of local government revenue, and in the past ten years, I’ve seen very little public participation during the budget process. I can only speak to the City of Russell’s process, which begins in April and ends in August. April begins with a look back at how we’ve performed in the past, where we can improve, and begin discussing priorities for the next year’s budget. Then we begin reviewing and discussing different budget segments at each meeting, which concludes in August with the final budget recommendations. You can attend in person or virtually, or you are welcome to come to the city building and discuss the budget proposals. Remember, you can access the city council agenda and all supporting documents the week before the meeting by visiting the city website at www.russellcity.org

Property taxes are an issue and challenge to many folks in our community, and my parents taught me a long time ago to stay informed and provide solutions. I have a solution that may help with property taxes. The solution is not a novel idea or a stroke of genius; rather, it is part of an agreement between the state and local governments. The agreements involved the loss of local revenue sources in exchange for establishing the Local Ad Valorem Property Tax Reduction fund (LAVTR), County City Revenue Sharing (CCRS), and Special City-County Highway fund (SCCHF). Revenue sharing in this manner dates back to the 1930s, with the current LAVTR statutory framework established in 1965 and the CCRS established in 1978.

According to the December 2022 issue of the Kansas Government Journal, cities and counties in Kansas have lost at least $3,470,603,394 as the result of the State’s decision not to fund demand transfers. Some state officials refer to the LAVTR, CCRS, and SCCHF as “state aid,” yet the history of these funds does not support that classification. (more…)