Guidebook for Effective Policies and Practices for Managing Surface Transportation Debt (2022)

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57   5.1 Overview After preparing and developing individual transactions in Phase 2, issuers must market the transaction to the municipal bond market in order to attract investors and optimize interest rates. In turn, with a successful marketing effort and sale (placement), bond proceeds are avail- able to finance the projects and programs determined in Phase 1. The purpose of Phase 3 is to maximize the proceeds of the issuance to be able to meet the agency’s surface transportation goals. Additionally, while issuers make several key decisions in Phase 3, much of the success of Phase 3 is contingent on programmatic and transaction-based decisions made in Phases 1 and 2. As in Chapters 3 and 4, the eight case studies are employed throughout this chapter to share examples of effective practices for marketing and placing individual transactions. The case studies will continue to be used to emphasize how different program characteristics have implications for that program’s approach to each phase of debt issuance and management. Chapter 5, Phase 3: Marketing and Placement of Individual Transactions, is organized as follows: • Section 5.2 discusses the importance of developing a bond pricing strategy. • Section  5.3 explains the importance of formulating strategies for marketing individual transactions. • Section 5.4 discusses the need for determining closing requirements and guidelines. 5.2 Developing a Bond Pricing Strategy 5.2.1 Key Decision-Making Factors: Bond Pricing Regardless of whether issuers elect to issue via a competitive or negotiated sale, they will need to develop a bond pricing strategy to prepare the issuance to be marketed and sold on the C H A P T E R 5 Phase 3: Marketing and Placement of Individual Transactions Individual Transaction Preparation and Development Marketing and Placement of Individual Transactions Post-Issuance Compliance Strategy The Decision Process—Planning for Debt Issuance

58 Guidebook for Effective Policies and Practices for Managing Surface Transportation Debt municipal market. Individual transaction preparation for both competitive and negotiated sales requires support from outside professionals, including FAs, bond counsel, rating agencies, audi- tors, trustees, and underwriters.1 However, competitive and negotiated sales vary by when the details of each sale are settled, and when outside professionals are utilized in the presale process.2 In a competitive sale, the bond issue is structured in advance of selecting an underwriter, while in a negotiated sale the issuer and the selected underwriter set the structure of the bond issue.3 Figures 17 and 18 show the process for competitive and negotiated sales, respectively. In a competitive sale, issuers work collaboratively with their bond counsel and FA to deter- mine the pricing parameters, and the size of the bond issue. This process is iterative, although Figure 17. Overview of competitive sale. Figure 18. Overview of negotiated sale.

Phase 3: Marketing and Placement of Individual Transactions 59   once finalized, the issuer markets the offering, soliciting underwriters to make a bid. The issuer typically elects to sell to the underwriter that offers the lowest interest rates. In a negotiated sale, the issuer instead collaborates with the underwriter and their FA to work to negotiate the terms of the issuance. During this process the underwriter collaborates with the syndicate. At the end of the process, the underwriter and FA negotiate the terms of the issuance based on discussions with the issuer and their preferences. Competitive Bond Pricing Strategy: The issuer determines the specifics of each sale inter- nally with the support of outside professionals.4 The issuer also prepares the bond documents, obtains credit rating(s), and completes all bond preparation tasks prior to placing the bonds on the market to solicit bids from buyers. Since the bond pricing strategy is determined internally by the issuer, it is important for the issuer to conduct extensive market research prior to deter- mining the specifics of each bond issuance. Market research—including historical research and research on where the issuer fits among similar issuers—will help to strategically inform the structure of the bonds. Once the structure is decided, the issuer places the bonds out for bid by investors and selects the investor who offers the best pricing—the lowest interest rates for the offering. Negotiated Bond Pricing Strategy: In a negotiated sale, an underwriter is selected to purchase the bonds. Once this procurement is completed, the issuer along with the FA and senior under- writer undertake an iterative process, which is most easily understood when broken down into three distinct phases: pre-pricing, pricing, and post-pricing, as depicted in Figure 19. The pre-pricing and pricing phases are of utmost interest, since these establish the bond pricing strategy and the pricing for the transaction. State practitioners must first lay the groundwork in the pre-pricing phase for the complete pricing process to be initiated properly and carried out effectively. Pre-pricing activities consist of procuring the underwriter, establishing policies and compensation, compiling pricing data, and conducting investor outreach. During the pre-pricing phase, issuers along with the senior underwriter who must purchase the bonds also consider the timing of the negotiated sale, which should be informed by an assessment of market conditions and key financial and eco- nomic indicators.5 In a negotiated sale, the selected underwriter sells the purchased bonds to its investor customers. The terms of the bonds are tailored to meet the demands of the under- writer’s investor clients, as well as the needs of the issuer. Flexibility to time the sale is one of the advantages of opting for a negotiated sale method, and issuers use this method to secure the best interest rates for the bonds.6 Presale activities are undertaken by the underwriter to determine interest in the bonds by year of maturity and interest rate. The initial pricing period sets the preliminary price and offers the bonds out for Source: Lockwood-McCall, Laura, Jocelyn Mortensen, and Tom Huestis. 2016. “The Ins and Outs of Negotiated Bond Pricing.” April 20. Figure 19. Negotiated bond pricing process.

60 Guidebook for Effective Policies and Practices for Managing Surface Transportation Debt purchase. e issuer, FA, and underwriter review the initial purchase oers and may adjust the sizing of the bonds by maturity year and then re-oer the bonds for purchase. Orders are then taken from bond purchasers. e verbal award is then made. As part of the transition from pricing activities to post-pricing, the bond purchase agreement memorializes the pur- chase price and bond delivery. Other parts of the post-pricing process consist of reviewing and analyzing secondary market trade activities and documenting and nalizing the sale results. e documentation includes a post-pricing book and a pricing memo, which helps the issuer to determine the underwriter’s performance.7 Figure 20 shows an exemplary ocial statement page, where the bond pricing by maturity structure is memorialized. 5.2.2 Leveraging Outside Professionals Approaches for developing and enacting a bond pricing strategy dier based on the method of sale the issuer elects. However, universally applicable eective practices include leveraging the expertise of outside professionals throughout the process and either adhering to programmatic policies or acting on lessons learned from previous issuances to further rene and develop the pricing strategy. Table 9 presents a spectrum of approaches for operationalizing a bond pricing strategy aligned with the method of sale that issuers elect. e Ohio example (see Example 23) Figure 20. Bond pricing by maturity—ofcial statement.

Phase 3: Marketing and Placement of Individual Transactions 61   Method of Sale Issuer and Bond Pricing Method U SU A LL Y N EG O TI A TE D PTC: As is typical in negotiated sales, the underwriter will get member consensus of the syndicate to develop their own pricing views and interest rate spread from benchmark AAA rates across the maturity scale and different couponing strategies as appropriate. Simultaneously, the FA on behalf of the PTC develops its own pricing rules and then a negotiation takes place. The underwriter and FA will reach consensus about the pricing that will be put out on the pre-pricing wire, prior to the bonds going out for sale. The bond pricing process also involves what maturities are open for retail customers, and defining retail customers and the retail order period. N EG O TI A TE D A N D C O M PE TI TI VE NY MTA: MTA undertakes a mix of competitive and negotiated sales. In competitive sales, bonds are advertised for sale. The advertisement, by way of a notice of sale, includes both the terms of the sale and the terms of the bond issue. Any broker-dealer or dealer bank may bid on the bonds at the designated date and time. The bonds are awarded to the bidder offering the highest price for the bonds, which results in the lowest interest cost to the issuer. As is typical in negotiated sales, the underwriter will get member consensus of the syndicate to develop their own pricing views and interest rate spread from benchmark AAA rates across the maturity scale and different couponing strategies as appropriate. Consecutively, the FA develops its own pricing views and then a negotiation takes place. U SU A LL Y C O M PE TI TI VE Virginia: VDOT typically works with its FA in advance of a specific issuance to develop the appropriate parameters and pricing strategies for review and approval by the Commonwealth Transportation Board (CTB). Debt authorizations by the General Assembly require that the CTB approve a resolution to further authorize the issuance of transportation debt,1 then advance it to the Treasury Board for its approval. The Treasury Board adopts the resolution approving the terms and structure of the proposed issuance within certain parameters and delegates to the treasurer the power to approve the final terms and structure within those parameters. Included in these parameters is the statement that the true interest rate cannot exceed a certain amount. If these parameters are not met, CTB will not be able to issue the debt. 1“Revenue Bonds.” Code of Virginia. https://law.lis.virginia.gov/vacode/title33.2/chapter17/section33.2-1708/ Table 9. Bond pricing by method of sale. Example 23. Include Pricing Strategy in Policies and Procedures (Ohio) OBM policies provide high-level requirements for developing a pricing strategy. OBM requires that sale preparers conduct a series of final checks on the issuance, including final cash flow calculations and compliance checks and specific guidance for negotiated issuances. The OBM policies require that the final cash flow calculations consider bond proceeds, issuance costs, and the original issue premium/discount of the bonds.1 Additionally, OBM policies require that issuers check the tax certificate to make certain that bonds comply with the requirement that 85 percent of the bond proceeds will be spent on capital expenditures within 3 years, based on IRS requirements for tax-exempt bonds. Further, for negotiated issuances, the issuer or FA is advised to utilize information from issuers of similar credit quality and structure to inform the pricing strategy. 1 Ofce of Budget and Management. 2018. “Post-Issuance Compliance Procedures.” <https://obm.ohio.gov/wps/portal/gov/ obm/areas-of-interest/bonds-and-investors/resources/policies-procedures-guidelines>

62 Guidebook for Effective Policies and Practices for Managing Surface Transportation Debt and the Arizona example (see Example 24) highlight that all issuers, regardless of the method of sale, work closely with FAs to determine the price of the bond, and that each issuer must navigate a dierent process to get approval to price the bonds. e context and the established processes for bond pricing will have implications on the timeline of pricing and the ultimate price and structure of the bonds. Eective communication between the entities involved is critical to issuers to price the bonds at the lowest interest cost. To facilitate the pricing process, issuers must eectively com- municate the needs of the program and purpose of issuance and select an eective bond pricing structure. Tools to facilitate eective communication include hosting presentations about the bond pricing structure to gather feedback and communicate nal decisions about the pricing structure as well as utilizing debt management policies as a means of establishing eective procedures and methods for the bond pricing process to provide for consistency and learn from past issuances. 5.3 Developing a Strategy for Marketing Individual Transactions 5.3.1 Key Decision-Making Factors: Strategies for Marketing Marketing is the stage when issuers attract investors and can maximize the bond proceeds to nance projects and programs, making it an important stage in the debt issuance process. A key prerequisite for successful negotiated and competitive sales is the issuer’s ability to educate the market about the value of their bonds. When navigating the marketing process, practitioners should make sure that the marketing plan reects the state’s overarching debt strategy. Addi- tionally, issuers should utilize information about the current market (what sales are occurring, when, for what amount) and the issuer’s and outside professionals’ knowledge of potential buyers. ese pieces of information help lay the foundation for an eective marketing strategy, and should be tailored to each issuance based on the decisions made in Phase 2, including the following: • Issuance amount, • Timing, • Debt type, • Debt instrument, and • Method of sale. Marketing strategies dier between negotiated and competitive sales. For negotiated issuances, underwriters must develop an appropriate re-marketing eort. When adopting a competitive Example 24. Internal Communication for Pricing (Arizona) In advance of a pricing, the FA is responsible for preparing pre-pricing information and market analyses. The underwriters are responsible for developing the deal structure and pricing, based on current market and economic factors. During pricings, ADOT conducts a 30-minute webinar for Financial Management Services Division staff in which the FA discusses the market conditions, explains the order monitor and answers questions. After the pricing, ADOT arranges another 30-minute webinar to show staff the results of the pricing. This provides ADOT staff with visibility into the pricing process, contributes to knowledge transfer, and allows staff to see how their own work contributes to ADOT’s debt program.

Phase 3: Marketing and Placement of Individual Transactions 63   sale, the notice of sale or information about the terms of the sale and the date should be widely distributed. 5.3.2 Leveraging Outside Professionals Issuers utilize a variety of approaches to effectively market individual transactions. First, it is a common and effective practice to leverage the expertise of outside professionals to develop marketing materials and market the bonds to investors. These outside professionals include FAs and underwriters. The approaches for marketing bond sales may vary based on the following factors: • Frequency of issuances, • Number of issuance-specific decisions, and • Credit rating history. For instance, issuers with a strong credit rating history may not need to dedicate as much effort to communicate the value of their bonds (see Example 25). The two primary factors that will differ between issuers are (1) the level of engagement with investors and (2) the degree of maturity or existence of established marketing processes. Table 10 discusses these factors in greater detail. 5.3.3 Tools: Marketing Issuers can rely on publicly available resources to perform research on the state of the market. Current market conditions and activity are available each business day from the Daily Report of The Bond Buyer, a news publication that reports on the municipal bond market.8 In order to market transactions, issuers have a variety of tools available to them, including leveraging their webpage, delivering presentations and/or hosting roadshows, and leveraging EMMA as an investor webpage. These three types of tools are described in the communica- tion and coordination text box as well as in the examples from Ohio, Virginia, and Florida (see Examples 26, 27, and 28). Communication and Coordination Issuers have several valuable tools at their disposal to communicate upcoming issuances, including presentations, roadshows, and investor webpages. As discussed in the section above, the frequency of using these tools and the maturity of established processes to create, maintain, and update the selected tools may vary among issuers. Programs that issue very frequently may have more staff available to develop these marketing products. Issuers should be mindful to dedicate the appropriate level of effort to create these marketing tools. For instance, it is often possible to re-use materials for a variety of marketing purposes. A team may use presentation materials during meetings with credit rating agencies to secure the transaction’s bond rating, and these materials in turn can be edited to attract buyers. The examples below highlight effective uses of roadshows and investor webpages. Source: WM Financial Strategies. “Bond Sale Methods (Competitive vs. Negotiated Bond Sales).” http://www.munibondadvisor.com/SaleChoice.htm

64 Guidebook for Effective Policies and Practices for Managing Surface Transportation Debt INFREQUENT ISSUANCES – Transaction- Based Investor Engagement to Market Unique Issuances (Massachusetts) FREQUENT ISSUANCES – Continued Engagement to Promote the Value of the Program (PTC) T ’s approach to arketing is progra atic and ongoing given how frequently they are in the market. T ’s we site is co prehensive and includes a ple information on the financial standing of PTC on an ongoing asis. Additionally, T undertakes significant regular outreach to investors, via its investor relations we site, in person eetings, and conferences. or e a ple, T has et with one large institutional investor on-site 2 years in a row, as the single largest investor across all outstanding onds. Generally, T staff eet with investors as needed, ostly in the ew ork ity region. The changes legislated y Act have created so e uncertainty for investors, and in response PTC has increased investor outreach to enhance communication and understanding. As part of the pre-pricing effort, T does we inar- ased road shows for each transaction. n preparation for these road shows, the underwriter is responsi le for identifying potential uyers, understanding their preferences for ond structure and price, and developing a pricing proposal and sales effort that alances the need to deliver the lowest possi le cost to T , while still fulfilling arket de ands. Mass T’s approach to arketing is on a transaction asis rather than on a progra asis. Mass T arkets refundings y delivering presentations to potential investors and holding luncheons in advance of each transaction. The purpose of these presen tations is to provide detailed infor ation a out the structure of the refunding and the enefits the issuance will have to the agency and the co onwealth. owever, this approach ay vary depending on the deal. Since MassDOT is not frequently in the arket, the de t anage ent tea does not engage with investors often. MassDOT also leverages BondLink to market their onds. Table 10. Differences in strategies for marketing. Example 25. Strong Credit Rating and Building Relationships with Credit Rating Agencies (Virginia) The CTB’s consistently high credit ratings and overall reputation have helped to facilitate a streamlined marketing process for transactions. The FA prepares materials for the CRAs to facilitate their work during the credit rating process for each issuance. CRAs will assign different analysts to produce a credit rating recommendation depending on the issuance type. For instance, a transportation analyst may be assigned a GARVEE transaction while a state-focused analyst may be assigned another type of transaction. Due to VDOT’s strong reputation with the CRAs, VDOT staff expressed that they do not need to engage routinely with CRA analysts and generally need more extensive engagement only when there is a new analyst assigned to the program.

Phase 3: Marketing and Placement of Individual Transactions 65   Example 26. Effective Webpage to Attract Investors (Ohio) Ohio provides a wealth of resources to potential investors in all of Ohio’s debt, including transportation-related issuances. The Treasurer’s Office maintains a BondLink platform, and OBM maintains a webpage that provides material for investors. The Treasurer’s Office investor relations page includes information on the most recent bond ratings from each of the CRAs, a calendar of upcoming bond sales, key financial documents, and high-level resources about Ohio’s bond program and municipal bonds more generally.1 On this website is a page dedicated to the ODOT transportation debt programs. The OBM investor relations webpage provides similar information, including a bond sale calendar, the 5 percent debt service limitation certification, and state policy information regarding what debt issuances are authorized under the Ohio Constitution.2 1 Treasurer of Ohio Investor Relations. https://www.ohiotreasurerbonds.com/the-state-of-ohio/i630 2 Ofce of Budget and Management. “Bonds and Investor Relations.” https://obm.ohio.gov/wps/portal/gov/obm/areas-of- interest/bonds-and-investors/bonds-and-investors

Example 27. Effective Use of Presentations and Roadshows to Attract Investors (Virginia) When VDOT goes to market the debt issuance, the CFO and Financial Planning Division debt staff with support from their FA and bond counsel develop a presentation about the program and issuance to share with potential buyers. This presentation communicates the summary of the offering, which is described in greater detail in the figure below.1 An overview of past issuances and a comparison of VDOT’s issuance against other similar issuances nationwide are also included in the presentation. VA Debt Issuance Presentation Overview: VDOT regularly engages investors to market specific offerings by notifying them of newly posted informational presentations on their webpage. Previously, when the GARVEE program was new, VDOT did more extensive marketing (“roadshows”), including calls with investors and the underwriter. Now that the GARVEE program is more mature, VDOT’s general marketing outreach is less extensive since the agency benefits greatly from the Commonwealth and CTB’s strong credit ratings. Additionally, the Virginia Treasury recently launched an investor website.2 The website has useful information for potential investors, including the Commonwealth’s bond ratings, current bond offerings, and additional resources for investors to learn about the Commonwealth’s credit worthiness and finance team. 1 Farmer, Laura. 2018. “Federal Transportation Grant Anticipation Notes, Series 2018.” http://www.ctb.virginia.gov/resources/ 2018/july/pres/8_garvees.pdf 2 “Commonwealth of Virginia.” Commonwealth Department of the Treasury. www.virginiabonds.com Example 28. Utilizing Multiple Platforms to Attract Investors (Florida) The Florida Division of Bond Finance (DBF)—the agency responsible for pre-issuance prepara- tion and marketing individual transactions—maintains three investor relations websites: 1) MSRB EMMA,1 2) the DBF webpage,2 and 3) a website dedicated to market new bond sales to investors.3 FDOT does not maintain a separate investor relations page but relies on the DBF’s established infrastructure to provide interim financial information to investors regarding repayment sources for the debt programs managed by the DBF. MSRB EMMA has been a valuable platform to provide required and voluntary disclosure to investors, given that the platform has improved over time and now allows site customization. The DBF staff additionally maintain a BondLink issuer site, which presents information about the DBF team, upcoming and recent sales, roadshows, bond ratings, and financial reports. 1MSRB EMMA. State of Florida. https://emma.msrb.org/IssuerHomePage/Issuer?id=F185C01DC47419B2E043161E0A0A841E &type=M. 2State of Florida Division of Bond Finance. https://www.sbaa.com/bondnance/. 3BondLink. State of Florida Division of Bond Finance. https://www.abonds.com/state-of-orida-investor-relations-/about/ our-team/i678.

Phase 3: Marketing and Placement of Individual Transactions 67   5.4 Meeting Closing Requirements and Guidelines 5.4.1 Key Decision-Making Factors: Closing Requirements and Strategy Issuers must adhere to prescribed national and state legal requirements when issuing debt on the municipal market. The MSRB provides guidelines on reporting requirements and maintains a market transparency system, which is an online data collection system, capturing municipal market transaction data for transparency, surveillance, and analytical purposes. MSRB processes and market transparency systems, including the Short-term Obligation Rate Transparency (SHORT) system, are used across the U.S. municipal securities market, and are applicable for all state debt typologies.9 Per MSRB rules, brokers and dealers must report municipal securities trans- actions using the Real-Time Transaction Reporting System and must report certain details about variable rate securities to MSRB via the SHORT System.10,11 These reporting systems’ infor- mation facilities or IFs have operational guidelines, which also include further details about these two systems. Issuers are also required to report issuances and associated materials, like the official statement, on the MSRB’s EMMA page. Directions to the trustee on the allocation of proceeds and the tax certificate are critically important documents for closing. Signed closing certificates by issuers and other deal participants (lawyers, underwriters, etc.) are also important documents required for closings. Issuers may also be subject to closing requirements and guidelines that have been established at the state or agency level. These may include certain parameters, such as the requirement that the true interest rate cannot exceed a given percentage. Issuers should review these requirements and guidelines for their respective state and agency. Practices to comply with closing requirements may differ between issuers. 5.4.2 Tool: Closing Procedures The established effective practices for complying with closing requirements might vary based on the frequency with which the program issues debt, along with the number and types of requirements that the issuer faces. Frequent issuers like PTC and MTA have well-established processes for meeting pre-issuance and closing requirements. Other programs that issue less frequently, like Arizona, also have established formal processes and procedures for pre-pricing and pricing to make certain that the program abides by the requirements, regardless of how much time passes between issuances. Programs like that of VDOT, which faces specific issuance- specific parameters established by the treasurer, need to develop customized processes and communication tools to meet closing requirements in every case. Table 11 describes two different approaches to meeting closing requirements. 5.4.3 Leveraging Outside Professionals Key to successfully meeting closing requirements, regardless of the type of program, is to effectively track the information about the issuance after the issuance has been marketed and placed. This can be a busy time for issuers, so effectively preparing for closing requirements in advance of issuing can be a useful approach to make sure requirements are met. Additionally, most issuers rely on support from outside professionals to meet closing requirements. As part of the closing, outside professionals—including bond counsel, underwriters, and FAs—develop the official statement, which includes details of the transaction, the bond counsel opinion, and identification of the bond trustee. An issuer, regardless of the frequency of its issuances, can benefit greatly from having support from outside experts during this phase to make sure that no requirement goes unmet.

68 Guidebook for Effective Policies and Practices for Managing Surface Transportation Debt 5.4.4 Tool: Templates and Checklists e management of large amounts of rapidly changing information, typically during a very short period, oen requires the development of templates, checklists, and other organizational tools that are easy to implement on relatively short notice. Bond pricing and closing can be a stressful process, so tools that help to reduce complexity and last-minute decision-making can be extremely valuable. ADOT and MTA have developed several tools to address these needs (see Examples 29 and 30). FEW ISSUANCE-SPECIFIC DECISIONS – Established Processes for Pre-Issuance Requirements (NY MTA) MANY ISSUANCE-SPECIFIC DECISIONS – Customized Processes and Communication Tools (Virginia) Pre-issuance involves the efforts of MTA, counsel, underwriters, and FAs to draft supplemental resolutions, secure MTA approval, develop the preliminary official statement, conduct due diligence, and seek credit ratings. Closing activities also include underwriter and bond counsel efforts to secure the necessary closing certificates required under the indenture. Specific actions that MTA undertakes in their closing requirements include the following:  All signatures and documentation are prepared by bond counsel and ready for pre-closing the day before closing to provide sufficient time to address any final concerns about the sale. If this is a negotiated deal, the underwriters’ syndicate, as represented by the senior manager, will be a part of this review.  MTA’s working groups for closing include bond counsel, underwriters, underwriter counsel, disclosure counsel, trustees, treasury, and FA reviewing closing memos. Since the treasurer oversees the parameters for the sale of every issuance, additional coordination between the various entities responsible for issuing surface transportation debt in Virginia is required. It is critical to have a clear approach to facilitate their review of all established stipulations. A Treasury representative must provide approval of the pricing before it can be authorized or released. Additionally, the final closing documents must be approved with the Governor’s signature. The Treasury Board is responsible for sending a package of materials to the Governor for final signature. Table 11. Differences in practices for meeting closing requirements. Example 29. Checklists for Pre- and Post-Closing Requirements (Arizona) An important part of ADOT’s bond closing processes and procedures is the pre- and post-closing checklist which is helpful in making certain that tasks are completed in a timely manner. For each task, the checklist includes such sections as deadline, responsible party, any EMMA filing requirements, ADOT system file path, when it should be completed (pre-closing, closing, post-closing), and actual date of completion.

Phase 3: Marketing and Placement of Individual Transactions 69   Example 30. Closing Requirement Memos (NY MTA) NY MTA utilizes closing memos prepared by either the FA for competitive deals, including money transfers, or the underwriter for negotiated deals. These memos lay out the process for the day of closing and is helpful guidance for treasury, the trustee, and all other parties. 5.5 Summary From developing a bond pricing strategy to completing closing requirements, the purpose of Phase 3 is to market an oering to investors, optimize the interest rates paid on the bond pro- ceeds, and use the bond proceeds to meet the goals of the surface transportation program. e most eective approach—including how and when to leverage outside professionals, how to conduct communication and coordination, and which tools to leverage—will dier for each issuer based on the frequency of issuances and the number of issuance-specic decisions, among other factors. At the end of Phase 3, the issuer will have completed the process of placing the transactions and gathering bond proceeds for projects and programmatic needs. However, issu- ing bonds on the municipal market also entails reporting and monitoring to meet post-issuance requirements, which will be discussed in the next chapter in Phase 4. 5.6 Endnotes 1. Municipal Securities Rulemaking Board. “Professionals Involved in a Competitive Municipal Bond Financing Transaction.” http://msrb.org/msrb1/pdfs/Professionals-In-Competitive-Transaction.pdf 2. Government Finance Ocers Association. “Debt 101, Volume 1—Issuing Bonds.” https://www.gfoa.org/ materials/debt-101 3. Government Finance Ocers Association. “Debt 101, Volume 1—Issuing Bonds.” https://www.gfoa.org/ materials/debt-101 4. Government Finance Ocers Association. 1994. “A Practitioner’s Guide to Eective Debt Management: Competitive v. Negotiated, How to Choose the Method of Sale for Tax-Exempt Bonds.” https://www.gfoa.org/ sites/default/les/APractitionersGuideCompetitiveVsNegotiated.pdf 5. Government Finance Ocers Association. 2010. “Pricing Bonds in a Negotiated Sale.” http://www.gfoa.org/ materials/pricing-bonds-negotiated-sale 6. WM Financial Strategies. “Bond Sale Methods (Competitive vs. Negotiated Bond Sales).” http://www. munibondadvisor.com/SaleChoice.htm 7. Lockwood-McCall, Laura, Jocelyn Mortensen, and Tom Huestis. 2016. “e Ins and Outs of Negotiated Bond Pricing.” April 20. 8. e Bond Buyer Daily Report. https://www.bondbuyer.com/daily-report 9. Municipal Securities Rulemaking Board. “IF-2: Short-Term Obligation Rate Transparency System.” http:// www.msrb.org/Rules-and-Interpretations/MSRB-Rules/Facilities/SHORT-Facility.aspx 10. Municipal Securities Rulemaking Board. “IF-1: Real-Time Transaction Reporting and Price Dissemination.” http://www.msrb.org/Rules-and-Interpretations/MSRB-Rules/Facilities/RTRS-Facility.aspx 11. Municipal Securities Rulemaking Board. “Rule G-14: Reports of Sales or Purchases.” http://www.msrb.org/ Rules-and-Interpretations/MSRB-Rules/General/Rule-G-14.aspx