On Thursday, April 9, the Federal Reserve took actions to provide up to $2.3 trillion in loans to support the economy. This funding will assist households and employers of all sizes and bolster the ability of state and local governments to deliver critical services during the coronavirus pandemic.
One of the actions that the Federal Reserve is taking is geared toward helping state and local governments manage cash flow stresses caused by the coronavirus pandemic by establishing a Municipal Liquidity Facility (the “Facility”). Pursuant to the Facility, a Federal Reserve Bank will commit to lend up to $500 billion to special purpose vehicle (“SPV”) on a recourse basis. The SPV will in turn purchase “Eligible Notes” directly from Eligible Issuers. The SPV will have the ability to purchase up to $500 billion of Eligible Notes. States, the District of Columbia, counties with a population of at least two million residents, and […]