13.30 Bonds – Post-Issuance Tax Compliance

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Scope: NMSU System

Source: RPM Regents Policy Manual Title 13 | Financial Resource Management

Policy Administrator:

Last Updated: 05/11/2018



Revision History:

05/11/2018 Policy adopted by Board of Regents

A. Purpose and Authority

The Regents of New Mexico State University (the “Issuer” or “Board of Regents”) hereby authorize and direct the adoption of Post-Issuance Tax Compliance Procedures (the “Procedures”) as part of the university’s Administrative Rules and Procedures, for the purpose of: (1) maximizing the university’s compliance with the federal tax law requirements applicable to its outstanding tax-exempt bonds and obligations, (the “Bonds”); and (2) identifying and resolving any noncompliance matters, on a timely basis, to preserve the tax-exempt status of the Bonds.


B. Policy Statements

  1. Adoption of Procedures: The administration is directed to establish and maintain written procedures to: (1) ensure that any Bonds that no longer qualify for tax-exempt status are identified and remediated in accordance with the requirements of the Internal Revenue Code of 1986, as amended (the “Code”) and applicable regulations, including the remediation provisions of Treas. Reg. Sec. 1.141-12 or other remedial actions authorized by the Commissioner of the Internal Revenue Service under Treas. Reg. Sec. 1.141-12(h); and (2) monitor compliance with the requirements of Section 148 of the Code (which include arbitrage, yield restriction and rebate requirements) and related regulations.
  2. Appointment of Compliance Officer: The Board of Regents designates the Senior Vice President for Administration and Finance to serve as the Post-Issuance Tax Compliance Officer (the “Compliance Officer”) for purposes of this policy and the Procedures adopted as required by this policy.
  3. Monitoring of Post-Issuance Compliance: The Compliance Officer will be responsible for monitoring post-issuance compliance for the Bonds pursuant to the Procedures. The Compliance Officer may designate employees of the university to carry out the duties under these Procedures on the Compliance Officer’s behalf in the same manner and with the same effect as any similar designation for any other purpose permitted by law.
  4.  Compliance with Covenants in Bond Documents: The Compliance Officer will ensure compliance with all covenants made by the university in the documents related to the Bonds (the “Bond Documents”) which must be complied with to maintain the preferential tax status of the Bonds, including, but not limited to use of the Bond-financed facilities, timely completion of arbitrage rebate calculations, required filings and restrictions on investment of Bond proceeds.
  5. Federal Tax Law Compliance: The Compliance Officer will take such actions as may be necessary to comply with federal tax law as it relates to post-issuance including any specific actions as may be specified in the Administrative Rules and Procedures.
  6. Remedial Action: If at any time during the life of a Bond issue, the Compliance Officer determines, after consultation with bond counsel, that a violation of federal tax law requirements applicable to that issue has occurred, the Compliance Officer will inform the Board of Regents, and the Board will take prompt action to accomplish an available remedial action under applicable regulations or to enter into a closing agreement with the IRS under the IRS’s Voluntary Closing Agreement Program or other future published guidance.