Mike Cullers on New Hampshire v. Massachusetts

In a complaint filed directly with the U.S. Supreme Court under its original jurisdiction,[1] New Hampshire has sued Massachusetts for attempting to tax residents of the Granite State who normally work in Massachusetts but are working at home during the pandemic. Read Mike’s comments on the case in The Bond Buyer here ($).



Additional Reading:

Information on the case from the New Hampshire Governor’s Office.

Mass. governor answers question about NH lawsuit over income taxes

“New Hampshire gains allies in tax fight against Massachusetts,” New Hampshire Union Leader, (Dec. 23, 2020; updated Jan. 25, 2021).

Pennsylvania v. New Jersey, 426 U.S. 660 (1976) (holding that Pennsylvania could not sue New Jersey in the Supreme Court on behalf of Pennsylvania’s citizens with respect to a New Jersey transportation benefits tax imposed on income of Pennsylvania citizens derived from New Jersey because Pennsylvania’s suit represented nothing more than an aggregation of private lawsuits that those Pennsylvania citizens could have brought against New Jersey for taxes withheld from them, and no sovereign or quasi-sovereign interests of Pennsylvania were implicated).

Principality of Monaco v. Mississippi, 292 U.S. 313 (1934) (holding, and unjustly depriving us of a monumental spectacle, that Monaco couldn’t sue Mississippi in the Supreme Court without Mississippi’s  consent to enforce pre-Civil War bonds issued by various Mississippi entities, which had been in default for around 90 years, and which had been donated to the Monaco consulate in Paris by certain unknown troublemakers who “had been advised that there was no basis upon which they could maintain a suit against Mississippi on the bonds, but that ‘such a suit could only be maintained by a foreign government or one of the United States’”).


[1] U.S. Constitution, Article III, Section 2.

How to Appeal Adverse Determinations from the IRS for Tax-Advantaged Bonds: New Guidance

The IRS has had a busy start to 2021! Guidance continues to pour forth as the change in Administration approaches. On January 4, the IRS released Revenue Procedure 2021-10, which provides issuers with updated procedures for obtaining review from the IRS Office of Appeals of proposed adverse determinations and rebate refund rejections by the IRS Office of Tax-Exempt Bonds. Rev. Proc. 2021-10 supplements and supersedes Rev. Proc. 2006-40, which previously set forth the procedures for getting to Appeals. Rev. Proc. 2006-40 predated the advent of tax credit and direct pay bonds, and therefore applied only to tax-exempt bonds. As many of you may have experienced, the IRS has applied the logic of Rev. Proc. 2006-40 to tax-advantaged bonds that were not tax-exempt bonds (e.g., BABs) in audits of those bonds.  Rev. Proc. 2021-10 adopts this practice.

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REMINDER: Building Back Better – A Virtual Event to Remember!

We just wanted to remind everyone that today, December 16, 2020 at 4:00 pm Eastern Squire Patton Boggs’ and the Association of Public Finance Professionals (APFP) of the District of Columbia, Maryland, and Virginia are hosting a virtual event to remember!  The event will feature insights from our colleagues, former Congressman Joe Crowley (D-NY), former Congressman and former Chairman of the House Committee on Transportation and Infrastructure Bill Shuster (R-PA), and former Secretary of Transportation Rodney Slater regarding what Joe Biden’s infrastructure “Build Back Better” plan will include.

Click here to register!  We hope to see you there!

Building Back Better – A Virtual Event to Remember!

We can all agree that the year 2020 has been incredibly polarizing.  Never have the authors of this blog fought with family members over politics, what to do or not do during the COVID-19 outbreak, and who should or should not be invited to Christmas Eve dinner more than we have this year.  However, one thing that all Public Finance professionals can agree on is that this country’s infrastructure plan is vital to our industry.

A lot of our industry is curious about what Joe Biden’s infrastructure “Build Back Better” plan will include.  He plans to launch “a national effort aimed at creating the jobs we need to build a modern, sustainable infrastructure now and deliver an equitable clean energy future.”

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The COVID-19 Pandemic Continues On and So Do Telephonic TEFRA Hearings

Remember earlier this year when the novelty of working from home hadn’t worn off, when every day wasn’t Groundhog Day, when we hadn’t run out of Netflix to watch, and when we were all concerned about how to satisfy the in-person TEFRA hearing requirement for tax-exempt private activity bonds in the midst of a pandemic and all sorts of Stay-at-Home orders?  I know, that seems like decades ago!

As a refresher, on Star Wars Day,[1] the IRS responded to NABL’s request for relief from the in-person TEFRA hearing requirement in the form of Rev. Proc. 2020-21.  Rev. Proc. 2020-21 permits telephonic TEFRA hearings during the period between May 4, 2020 and December 31, 2020.  Specifically, during this period, a governmental unit can meet the TEFRA requirement that the public hearing be held in a convenient location by affording the general public access to the hearing by toll-free telephone call.[2]  It’s clear that the IRS was also hoping that the COVID-19 pandemic would be all but a distant memory by the end of 2020.

Unfortunately, it looks like the COVID-19 pandemic is probably going to be with us beyond December 31, 2020.  So, yesterday, the IRS issued Rev. Proc. 2020-49, which extends until September 30, 2021 the period during which telephonic TEFRA hearings can be held in lieu of in-person TEFRA hearings.  Hopefully, we won’t be in quarantine until then.

Now back to your regularly scheduled stalking of election coverage.


[1] Or May 4, 2020 – you can choose how you want to recognize days in 2020.

[2] Never have the authors of this blog explained to so many people what a toll-free number is.

We Heard You Missed Us – We’re Back! To Talk about Business Days.

It’s fall, and that means two things.  Pumpkin spice everything, and a calendar that’s replete with holidays – Sukkot, Halloween, Thanksgiving, and Sweetest Day[1] to

name but a few.  Diligent readers of The Public Finance Tax Blog will remember that we previously posted an exhaustive analysis of the “hold-the-offering-price-method” of establishing the issue price of tax-exempt bonds (the “HTOP Method”).  These same readers no doubt remember Treasury regulation § 1.148-1(f)(2)(ii)(B), which requires that the underwriter agree in writing neither to offer nor sell a bond to which the HTOP Method will apply at a price that is higher than the bond’s initial offering price to the public for a period that begins on the sale date of the issue and that ends on the close of the fifth business day after the sale date.[2]

These readers are now perhaps wondering whether, given the surfeit of autumnal holidays, they have correctly counted the number of business days to achieve a successful invocation of the HTOP Method.  Don’t worry; we’re here to help.

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Morning Zoo Radio and Cash Flow Relief for Issuers: Part 2

In Part 1, we introduced the cash flow relief technique/staple of your morning commute known as “Scoop and Chuck.” In particular, we discussed an issuer that will issue new bonds and use the proceeds to pay interest (but no principal) on a prior issue of bonds.  The new bonds will have a debt service schedule that is pushed out later in time compared to the debt service schedule on the prior bonds. This enables the issuer to keep some of the revenues that it otherwise would have used to pay debt service on the prior bonds. In Part 2, below, we’ll add more facts and try to provide some answers.

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Morning Zoo Radio and Cash Flow Relief for Issuers: Part 1

The pandemic is forcing even the most frugal issuers to seek to reduce or postpone their debt repayment requirements. There are many ways to do this. Each approach has pros and cons from a business perspective. Not surprisingly, each approach also has tax consequences that are often not intuitive and sometimes downright devilish. We will tackle them one at a time in a series of bite-size (relatively speaking) posts. First up: It’s America’s #1 Morning Zoo Tag-Team Radio Show: SCOOP AND CHUCK! 

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SPB Webinar: The Municipal Liquidity Facility and Other Current Developments for States and Municipalities

Please join Squire Patton Boggs on Friday, May 8, at 12 pm Eastern time for a one-hour webinar covering the Federal Reserve’s Municipal Liquidity Facility,  the CARES Act, and Chapter 9. Click here to register.

The webinar will be led by our colleagues Karol Denniston, Alethia Nancoo, and David Stewart (former Majority Staff Director for the House Committee on Ways and Means).

The Federal Reserve has agreed to purchase up to US$500 billion of short-term municipal notes from eligible municipal issuers. Please join us for an update on the Municipal Liquidity Facility’s general terms, who can access and what is provided.

We will continue to review the challenges and benefits of accessing the facility and what changes may be needed.

Here’s the registration link again. We hope you can join us.

The IRS Comes Through: New Guidance Allows Phone TEFRA Hearings and Helps Issuers Repurchase their VRDOs Without Extinguishing Them

As described in our previous post, NABL hasn’t been binge watching Tiger King and binge eating like the rest of us during this time at home during the COVID-19 pandemic.  Instead, on March 25, 2020, NABL asked the IRS to adopt a proposed notice  that would address two municipal bond concerns caused by the pandemic: (1) the requirement of in-person TEFRA hearings for tax-exempt private activity bonds; and (2) the extinguishment of qualified tender bonds and commercial paper if the issuer of such debt repurchases it without meeting certain requirements.

The IRS responded on Star Wars Day[1] with Rev. Proc. 2020-21 and Notice 2020-25, which should help alleviate these two concerns through the end of 2020.

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