Series 50: Competitive Bid Authorization

Competitive Bid Authorization

Most states require local governments to select an underwriter for GO bonds through a competitive bidding process. This means that the municipal issuer will advertise for an underwriter and several underwriters will submit bids. Since the bidding process cannot begin until after the bonds are authorized, the issuer itself must oversee the preparation of the preliminary materials and present them to the governing body of the issuer for a decision.

After the governing body approves the proposal, the issuer will hire a bond counsel. The bond counsel is a law firm hired to provide an objective legal opinion about whether:

• • The issuer has legal authority to issue the bonds
• • The interest on the bonds is exempt from fede