Assemblyman Fred W. Thiele, Jr. today announced that legislation he sponsors with Senator Jim Gaughran extending the effectiveness of a pilot program established in 2019 that provides certain municipalities with the option to sell bonds in an open electronic auction format, A.7384/S.6587, was signed into law by the Governor as Chapter #298 of the Laws of 2021.

There are several states, including California, New Jersey, Ohio and Texas, that have enacted legislation to allow municipalities to conduct public bond sales through nationally recognized bidding firms, many of them choosing an electronic bidding open auction format which was not previously provided for under New York’s local finance law.In 2019, Assemblyman Thiele and Senator Gaughran, Chairs of the Assembly and Senate Local Government Committees; respectively, authored legislation establishing a two-year electronic open auction bond sale pilot program as a means of assessing the financial and administrative advantages of selling bonds via an open auction format in New York State (A.8336A/S.5886A – Chapter #643 of the Laws of 2019).While the pilot program became effective on January 1, 2020, a necessary chapter amendment and the COVID-19 pandemic drastically stalled the Department of Financial Service’s implementation.Concerns arose as this delay would have cut short the period of time that eligible municipalities would have to take advantage and evaluate the efficacy of the open auction process before the program’s scheduled sunset date of January 1, 2022.Chapter #298 will extend provisions of the open bond auction pilot program until January 1, 2024.

Assemblyman Thiele stated, “New York State is already allowed and has successfully utilized the electronic open auction public bond sale process.Most recently, the City of Syracuse issued a bond offering under the provisions of the pilot program. I believe that many of the other eligible municipalities will also want to explore the open online auction format as a chance of increasing bidder participation and competition when selling municipal bonds. This legislation will certainly afford them the time they need to make that decision.I applaud the Governor for recognizing the importance of extending the electronic open auction bond sale pilot program for an additional two years to ensure that enough data is gathered to determine whether or not the provisions of the program should be made permanent.”