Navigating Arbitrage Compliance Together: ACS at Industry Conferences
Participating in a variety of local, regional, and national conferences keeps us at the forefront of industry trends and best practices. This broader perspective allows us to identify innovative solutions and tailor our services to address the specific arbitrage compliance challenges facing your organization.
We encourage you to visit our booth or schedule a meeting directly with us during the following conferences! We look forward to seeing you there.
Look for ACS at These Conferences
CASBO 71st Annual Conference
Colorado Association of School Business Officials
May 1st – 3rd, 2024
Pueblo, CO
WASBO Annual Conference
Washington Association of School Business Officials
May 8th – 10th, 2024
Tacoma, WA
FGFOA 2024 Annual Conference
Florida Government Finance Officers Association
May 18th – 22nd, 2024
Hollywood, FL
GFOA’s 118th Annual Conference
Government Finance Officers Association
June 9th -12th, 2024
Orlando, FL
2024 AWBD Annual Conference
Association of Water Board Directors
June 13th – 15th, 2024
Fort Worth, TX
Idaho ASBO Annual Conference
Idaho Association of School Business Officials
June 26th – 28th, 2024
Boise, ID
2024 WFOA 69th Annual Conference
Washington Finance Officers Association
September 17th – 20th, 2024
Yakima, WA
GFOAT Fall Conference
Government Finance Officers Association of Texas
October 30th – November 1st, 2024
San Marcos, TX
CGFOA 2024 Annual Conference
Colorado Government Finance Officers Association
November 19th – 22nd, 2024
Colorado Springs, CO
GFOA’s 119th Annual Conference
Government Finance Officers Association
June 29th – July 1st, 2025
Washington, DC
FAQs
What is Arbitrage Rebate?
Arbitrage is earned when proceeds of a tax-exempt or tax-advantaged bond issue are invested above the bond yield, the average yield issuers pay to their bondholders. At its most basic level, this liability to the U.S. Treasury is the excess earnings received from investments when the average rate of return is above the bond yield.
What steps should I take to adhere to Arbitrage Rebate and Yield Restriction Rules?
Keeping quality records is critical to staying in compliance. The IRS requires that issuers maintain a daily transaction detail. Funds invested in established bank accounts will easily satisfy this requirement. Issuers maintaining records separately, on the other hand, should equip data with a running balance that captures deposits, expenditures, and interest earnings by date. Issuers ought to be mindful of IRS-required reporting deadlines upon each new bond issuance. Arbitrage and yield restriction liabilities must be computed at least once every five years from the date of issuance, as well as on the issue’s final maturity date. Arbitrage earnings and yield reduction payments must be paid, or “rebated”, to the United States Treasury within 60 days of each reporting date. Preparation is key. We recommend annual reporting to all of our clients. Completing annual reports has the advantage of allowing the issuer to encumber liabilities in their books and records before a payment is due.
Should I be aware of any exemptions from the rebate requirement?
Yes! There are two major exceptions to arbitrage rebate that every issuer should know: the small- issuer exception and the spending exception. As you may have guessed, the small issuer exception to rebate is based on the size of your debt issuances. Governmental issuers expecting to issue less than $5 million of tax-exempt bonds in a calendar year may be exempt from the rebate requirements. This threshold increases to $15 million for bonds issued to build public schools. The spending exception to rebate is available to issuers meeting certain time thresholds for expending bond proceeds.
The three spending exceptions are the:
1. 6-month spending exception
2. 18-month spending exception and
3. 2-year spending exception
If the proceeds of an issue are invested above the bond yield, meeting a spending exception allows the issuer to keep all of its interest earnings. Who doesn’t love a little extra spending money?
Contact us
One of our expert analysts will be happy to contact you about your bond compliance needs.