Though the Sept. 17 deadline is long passed, Comments on the SEC's Proposed Money Market Fund Reforms continue to trickle in. The latest is from Margaret Wood Hassan, Governor of New Hampshire, who is the second Governor to weigh in on the SEC's proposal. (The first was from Deval L. Patrick, Governor, Commonwealth of Massachusetts.) The NH Governor says, "I write to express concern relative to a rule proposed by the Securities and Exchange Commission (SEC) in June of 2013 that would amend the regulatory structure for Money Market Funds (MMFs). While I appreciate the efforts of the SEC to provide reform on matters important to investors, I believe if implemented this proposed rule could adversely affect the State of New Hampshire and our cities and towns. In New Hampshire, MMFs provide nearly two-thirds of short-term credit utilized by our cities and towns to finance essential capital projects, including funding the construction of roads and schools. I am concerned that the SEC's proposed amendment to rules governing MMFs, specifically the proposed elimination of a stable $1.00 net asset value and imposition of redemption restrictions on investors, will reduce the amount of capital available to state and municipal governments as MMFs become less attractive to investors. Moreover, while the SEC was right to exclude Treasury and Government money market funds from the proposed rules, the decision to consider municipal MMFs as prime or non-governmental funds is troubling. Municipal MMFs have historically not experienced sudden, unanticipated withdrawals and as a result, I am concerned by the scope of the proposed rules, which could restrict borrowing by state and municipalities for important public infrastructure projects. As the SEC continues to deliberate this proposal, I urge you to consider the harmful impacts that such changes could have on the people of New Hampshire and request that the SEC exclude municipal MMFs from new regulations contained in the current proposal."
