Yale School of Management

Posts by Municipalities

How Available Is the ESF for New Fed Facilities?

January 12, 2021
When Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act on March 27, 2020, it allocated $500 billion to the Exchange Stabilization Fund (ESF), $454 billion of which was for the Treasury Secretary to support Federal Reserve lending facilities. The Secretary committed $195 billion of these funds to provide credit support to some of the programs the Fed set up under its Section 13(3) emergency lending authority. The Consolidated Appropriations Act, 2021 signed into law on December 27 definitively closed these facilities and rescinded funds “not needed to meet the commitments, as of January 9, 2021, of the programs and facilities established.” Continue reading “How Available Is the ESF for New Fed Facilities?”

Federal Reserve Lowers Pricing for Municipal Liquidity Facility

August 19, 2020
The Federal Reserve Board announced August 10 that it would revise pricing for the Municipal Liquidity Facility (MLF). Specifically, the updated term sheet includes a reduction in the interest rate on MLF loans of 50 basis points across all credit rating categories. The Fed also revised the relationship between interest rates for tax-exempt notes and for taxable notes. Continue reading “Federal Reserve Lowers Pricing for Municipal Liquidity Facility”

HEROES Act would provide $3 trillion in additional benefits but unlikely to progress

June 2, 2020
The $3 trillion Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act , which the House of Representatives passed on May 15, is the fourth and largest legislative rescue package proposed by the US Congress in response to the COVID-19 pandemic. It would help to mitigate the economic impact of continued shelter-in-place orders and soaring unemployment rates. Continue reading “HEROES Act would provide $3 trillion in additional benefits but unlikely to progress”

Federal Reserve Expands Eligibility for Municipal Liquidity Facility

May 4, 2020
On April 27, the Federal Reserve announced an expansion in scope and duration of the Municipal Liquidity Facility (MLF), a new facility established on April 9 to alleviate the funding needs of cities, counties, and states as municipalities fight the ongoing threat of COVID-19 across the United States and bond markets stall. Continue reading “Federal Reserve Expands Eligibility for Municipal Liquidity Facility”

Federal Reserve Announces $2.3 trillion Lending Package

April 10, 2020
The Federal Reserve announced on April 9 a series of programs totaling $2.3 trillion with significant equity participation from the Treasury, including unprecedented direct financing to businesses. The programs include new facilities and expansions of existing programs. By including both riskier securities and issuers, they signal the Fed's willingness to take risks it did not take during the Global Financial Crisis. Continue reading “Federal Reserve Announces $2.3 trillion Lending Package”