Last week, APGA signed a letter to Senate leadership urging them not to impose new data standards on state and local governments. The letter was put together by the Public Finance Network (PFN), a coalition of associations and other organizations interested in municipal finance issues.
When the Senate returns from its current recess in November, one of the first items it will consider is the National Defense Authorization Act (NDAA), a must-pass annual defense spending bill. Senators Warner (D-VA) and Crapo (R-ID) have indicated that they plan to offer S. 4295, the Financial Data Transparency Act, as an amendment. The language mirrors an amendment that was included in the House version of the NDAA that passed that chamber earlier this year.
The bill directs covered agencies to conduct a joint rulemaking within two years. The rulemaking would establish data standards for information collection that would apply to any submissions shared with financial regulators, including the Municipal Securities Rulemaking Board (MSRB). The standards would have to require, among other things, that all data be fully searchable and machine readable and would concern requirements for things like how accompanying metadata is documented. The data being reported to these agencies would also be considered open government data assets and made freely available for download.
Bond issuers, including state and local governments, are generally required to share information with the MSRB while their bonds are outstanding. It’s likely that many state/local government issuers of bonds may be using financial management systems that would not meet these new data standards. The standards would be issued within two years of passage, which does not give entities much time to prepare to reconfigure their financial management systems or transition to new software etc. Such transitions will likely be costly if necessary, and the bill does not provide any financial support or assistance for those required to make changes in order to be in compliance.
The PFN letter raises those concerns and urges legislators not to include the proposal as part of the NDAA.
View a copy of the letter
here. APGA encourages members to share this with their Senators’ offices and explain to them the negative impact this bill would have on bond issuers.
For questions on this article, please contact Emily Wong of APGA staff by phone at 202-470-4262 or y email at
ewong@apga.org.