Kansas Municipal News
The $3.8 trillion municipal bond market, rocked by the coronavirus, looks to Washington for help
The $3.8 trillion market for funding state and local governments, airports, schools and hospitals faces a test this week as New York City’s transit agency offers bonds to the market for the first time since the coronavirus emptied its subways, trains and buses.
Investing in the roughly $900 million offering from the Metropolitan Transportation Authority will be a leap of faith on the part of investors who will will have to imagine a healthier, post-shutdown New York economy, where commuters return to work, students go back to school and tourists come to see Broadway shows again.
That’s the same story for many issuers, as states and cities grapple with how to fill a sudden budget hole and move forward, in an environment of uncertainty about what the economic rebound will look like and how it will impact future revenues.
(Read more: Bonds)
With rates near zero, what to expect from Fed meeting
The Federal Open Market Committee meeting that began Wednesday, and concludes with a statement and a press conference from Federal Reserve Board Chair Jerome Powell, will be unique because rates remain at the zero lower bound and the Fed has taken many actions to ensure smooth markets since the economic shutdown to contain the coronavirus.
…Tom Garretson, senior portfolio strategist fixed-income strategies for RBC Wealth Management’s Portfolio Advisory Group … expects the Fed to announce “a more-flexible monthly purchase program [for Treasuries] north of $100 billion. While we expect the composition of Treasury purchases to eventually shift toward longer-duration as part of a concerted effort to provide stimulus via lower yields similar to the QE2 program — as opposed to recent purchases across the curve in the name of market liquidity — the Fed may wait until the June meeting when they will have more economic data, and an update to their economic projections and interest rate forecasts. A monthly program will give them more flexibility to go where any market stresses might necessitate them to.”
(Read more: The Latest)
Manhattan Mayor Announces Creation of Regional Recovery Task Force
Manhattan Mayor Usha Reddi announced today the formation of the Manhattan Area Recovery Task Force to help guide the City and surrounding area as we emerge from the effects of the COVID 19 virus in all areas of daily life and commerce.
The charge to the Task Force is to “develop a measured and phased path forward for our community and begin implementation as soon as next week, in some areas.” Jason Smith, President and CEO of the Manhattan Area Chamber of Commerce and Bob Copple, CEO, Ascension Via Christi Hospital have been appointed to co-chair the Task Force.
In organizing the Task Force, Mayor Reddi stated, “I am proud of how our community has come together to tackle the virus head on by following guidelines provided by the Centers for Disease Control and the Kansas Department of Health and Environment. Fortunately, Manhattan and the Flint Hills Region has an abundance of talent, resources, and motivation to work within the unique parameters in place due to the pandemic, as we begin the journey toward a new sense of normalcy.”
(Read more: Manhattan – News Flash)
Municipal Bond Trends for April 27, 2020
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 and Beth Warren.
Fed expands muni-debt program to cover “smaller” cities, counties (at least 500,000 population for counties and 250,000 for cities)
The Federal Reserve expanded the scope and duration of the Municipal Liquidity Facility, a $500 billion emergency lending program aimed at providing short-term credit to state and local governments as they endure the economic fallout from the coronavirus pandemic.
The U.S. central bank lowered the population thresholds under which counties and cities would be eligible to sell short-term debt to the facility. The new levels are at least 500,000 for counties and 250,000 for cities, down from 2 million and 1 million.
“The new population thresholds allow substantially more entities to borrow directly from the MLF than the initial plan announced on April 9,” the Fed said in a statement Monday.
(Read more: The Bond Buyer)
The Fed won’t move on rates this week, but here are some other things it could do
FAfter unleashing the most aggressive programs to support markets and the economy in its history, the Federal Reserve is likely to pause any additional initiatives until it has more information about how those moves are working and what lies ahead.
That does not mean, however, that central bank officials won’t have some news in store when they meet this week.
In the months since the coronavirus has ripped through the nation and the world, the Fed has slashed its benchmark interest rate to near zero and launched a variety of programs that also look to get money to households and businesses in need.
(Read more: Bonds)
As coronavirus cuts into budget, Olathe furloughs nearly all city staff for two weeks
Facing deep budget cuts because of the coronavirus pandemic, the city of Olathe will furlough nearly all employees for two weeks.
Like all other municipalities in Johnson County, Olathe is bracing for the long-term economic impacts of businesses, hotels and shopping centers remaining closed during the stay-at-home order. Officials expect the coronavirus shutdown to cut into sales and property tax revenues, as well as franchise fees and court fine collections.
“The budget challenge the city is facing is more significant than faced in decades,” city officials said in a statement. “It will likely not only impact the 2020 approved budget, but revenue estimates show it will carry over into the budget process for 2021.”
(Read more: Joco 913 News)
Shawnee Mission closes all school fields after repeated COVID-19 rule violations
Even after the Shawnee Mission school district threatened to issue citations to people who violate social distancing rules on its athletic fields, large groups continued to congregate and play sports, officials said. Now, the district has closed all of its fields.
“Several attempts were made to find a compromise to allow use of the fields while also strictly following personal distancing and other health guidelines,” district officials said in a news release. “Unfortunately, the district continued to experience repeated violations of those guidelines, as well as attempts to circumvent the spirit of the guidelines by organized groups.”
The district’s fields and stadiums had been open, even though schools are closed, to let the community exercise during the COVID-19 stay-at-home order. But the district and local police departments have received several complaints about groups ignoring social distancing rules.
(Read more: Joco 913 News)
University of Kansas announces pay cuts among top officials
The University of Kansas is temporarily slashing the pay of high-ranking administrators and athletic staff in anticipation of the coronavirus causing tens of millions of dollars in financial losses. Chancellor Douglas Girod announced Monday that the school will save $853,000 by cutting the salaries of nearly 40 university leaders by 10% for six months. The salaries of men’s basketball coach Bill Self, football coach Les Miles, and Athletic Director Jeff Long also will also be slashed by the same percentage, generating $500,000.
(Read more: 1350 KMAN)
Will students show up for college in fall 2020? Community colleges offer a hint. It isn’t pretty.
Ask a community college president about what school will look like in the fall and be prepared for an eye roll, lots of shrugging and even a baffled look or two.
They’ve got no clue, really. That’s not their fault. In the coronavirus era of rapidly changing information and restrictions, the presidents have no idea what they’ll be allowed to do, much less how they are going to instruct students. “That will be the million-dollar question. I’m not sure we know yet,” said Martha Parham, the senior vice president for public relations for the American Association of Community Colleges. “A lot depends on how the economy bounces back.”
(Read more: andoveramerican.com)
Gov. Laura Kelly to unveil recovery plan Thursday as Kansas surpasses 3,000 COVID-19 cases, up to 120 deaths
Gov. Laura Kelly said Monday Kansas should expect more guidance on Thursday on how the state will emerge from a stay-at-home order. The governor said she’s been in talks with industry leaders and neighboring states to develop a recovery plan for Kansas. “We’re working with everybody across the state of Kansas that we can, so when we put the plans out, they would have provided us input, but they’ll also know what to anticipate, and can work accordingly,” said the governor.
(Read more: KWCH News)
Dodge City Commissioners to cut own salaries
Budget adjustments were the talk of the recent Dodge City commission meeting as it is estimated $3 million would be lost from the 2020 budget for the city.
According to city officials, city administration and staff are taking steps to adjust the budget in response to the COVID-19 pandemic with substantial cuts needing to be made to account for the shortfall in expected revenues.
“Even with all of the cuts on the expenditure side of the ledger, we were still short over $700,000 in cuts that needed to be made,” city manager Cherise Tieben said. “Because we function on very tight operational budgets already, hard decisions had to be made at the City Commission meeting.”
(Read more: News – Dodge City Daily Globe – Dodge City, KS)
First cruise night a big hit in Hiawatha
Saturday’s Cruise Night in Hiawatha brought more action than local residents have seen downtown in a long time!
Oregon and First streets were packed with cars and trucks of all kinds and all years, with even a motorcycle or two thrown in. Local residents honked at other cars, or some residents sitting around the courthouse and on their porches of houses along the main drag. Everyone was all smiles and after a month of social distancing and a stay at home order, Hiawathans were ready to share the love! Organizers Steve Winters and Ryan Meininger said the event was great and they hope to plan another.
(Read more: hiawathaworldonline.com)
Municipal Bond Trends for April 24, 2020
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 and Beth Warren.
Municipal bonds on ‘fragile side of normalcy’ as benchmark yields rise but new deals get done
The secondary muni market was dislocated Friday with high-grade block trading showing swings in yields and rate volatility and price discovery remain problematic for investors and issuers alike. After a week of large issuers bringing sizable deals, Friday did not fully commit to a more stabilized muni market.
The news out of Washington did not help as headline risk clearly had participants questioning direction from D.C. on policies affecting the municipal market.
Triple-A benchmark yields rose by about five basis points across the curve.
(Read more: The Bond Buyer)
Fed’s near-zero rates to last into 2023, economists predict
The Federal Reserve may hold interest rates near zero for three or more years, and its balance sheet will soar above $10 trillion as policymakers seek to revive the U.S. economy from recession, economists said in a Bloomberg survey. Just over half the 31 respondents to an April 20-23 poll predicted the target range for the federal funds rate, now at 0-0.25%, won’t move up until at least 2023. Another 22% said not before 2022. …
Respondents had limited expectations for any substantial changes when the Federal Open Market Committee holds its next policy meeting April 28-29. Large majorities, 90% and 87%, said they didn’t expect policy makers to offer any additional guidance on how long they intend to keep rates near zero, or on the future pace of large-scale asset purchases.
(Read more: The Bond Buyer)
What will ‘reopening’ look like in Wichita area during the coronavirus pandemic?
When the Wichita area reopens businesses shuttered for the coronavirus threat, things will look a lot different than they did before the pandemic hit, according to an array of business leaders who spoke to Sedgwick County Commission on Friday.
The special commission meeting brought together leaders from the retail, restaurant, convention, entertainment, fitness, tourism and religion realms.
The clock is ticking on the commissioners, who are poised to set guidelines for businesses if Gov. Laura Kelly’s stay-at-home executive order is allowed to expire in the coming week.
(Read more: Local News |)
Sedgwick County may have peaked on COVID-19, health officer says
Sedgwick County appears to have passed its peak for coronavirus infections, but there’s a long road back to normal, the county’s top doctor said Friday.
“Fortunately, the hospitals think they have seen the peak, although the peak is very flat,” said Garold Minns, dean of the University of Kansas School of Medicine in Wichita. “They (local hospital administrators) are feeling good about the fact that we are not going to have a huge surge” of new COVID-19 cases.
(Read more: Local News |)
Reno County Health Department recommends use of cloth masks when out in public
Reno County Health Department joins Governor Laura Kelly, KDHE and CDC in recommending use of cloth face coverings when in public places. The recommendation is for cloth coverings, not N95 or surgical masks which are used by healthcare workers and first responders.
You can find instructions on how to make a cloth mask on the CDC website at www.cdc.gov.
New evidence suggests that some people without COVID-19 symptoms can transmit the virus before getting sick. Using a cloth mask can help keep the virus from spreading from a person who may be infected and is not aware to others they are come in contact with. Wearing a mask should be used along with the following measures:
(Read more: Hutchinson, KS – News Flash)
New rules, same local flavor: Overland Park Farmers Market opens during pandemic
Much to the joy of thousands of customers, a seasonal mainstay found a way to open this weekend.
The coronavirus pandemic forced the Overland Park Farmers Market to open a few weeks late this year and in an entirely new location. However, the market is now set up and running in the north parking lot of the Overland Park Convention Center.
The location provides the crowds with lots of room for social distancing. It’s not much like the weekend morning party it used to be, but the vendors are still full of produce, lines of masked customers ecstatically exchanging money for radishes, strawberries, lettuce and flowers.
(Read more: fox4kc.com | FOX 4 – WDAF)