April 11, 2025

Ronald W. Smith
Corporate Secretary
Municipal Securities Rulemaking Board
1300 I Street NW
Suite 1000
Washington, DC 20005

Re: Potential Modernization of Municipal Fund Securities Disclosure Obligations Dear Mr. Smith:

The Securities Industry and Financial Markets Association (“SIFMA”)¹ appreciates the opportunity to provide input in response to the Concept Release issued by the Municipal Securities Rulemaking Board (“MSRB”) regarding its Potential Modernization of Municipal Fund Securities Disclosure Obligations (the “Notice”).² SIFMA welcomes the MSRB’s retrospective review as we strongly support modernization of dealers’ disclosure obligations in municipal fund securities transactions, which have not kept pace with technological advancements, investor behavior, or the unique attributes of these securities. In addition, updating the MSRB’s disclosure requirements for municipal fund securities transactions would ease administrative burdens on dealers without compromising the quality, timeliness, or effectiveness of the information investors receive in municipal fund securities transactions.

Executive Summary

SIFMA has been a longstanding supporter of modernizing disclosure obligations in connection with municipal fund securities transactions. For example, we have previously supported proposals to adopt electronic delivery (“e-delivery”) as the default delivery method for municipal fund securities plan disclosure documents, consistent with the approach for disclosures related to municipal debt securities and other investor documents.³ Similarly, we have recommended that based on their unique attributes, the time of trade disclosure requirements for municipal fund securities be addressed in a single, stand-alone rule.⁴ Consistent with our past support for disclosure modernization for municipal fund securities transactions, and as further discussed below and in the appendix to this letter, SIFMA recommends that the MSRB:

• adopt “access equals delivery” as the default disclosure standard in MSRB Rule G-32 for the delivery of plan disclosure documents in connection with municipal fund securities transactions, as this approach would maintain the important transparency protections for investors while easing obligations and costs imposed on dealers; and
• consolidate the time of trade disclosure requirements for municipal fund securities transactions within a single, stand-alone rule that generally is consistent with the current time of trade disclosures applied to municipal debt securities in Rule G-47 but is designed to account for the characteristics specific to municipal fund securities.

Discussion

I. “Access Equals Delivery” Should Be the Default Standard in MSRB Rule G-32 Relating to Disclosures in Connection with Primary Offerings

The MSRB should update Rule G-32 to adopt “access equals delivery” as the default standard for delivery of municipal fund securities plan disclosures. Although there are attributes of municipal fund securities that differentiate them from traditional municipal debt securities (further discussed below), those differences do not justify taking separate approaches to the method for making official statements and plan disclosure documents available to investors. Modernizing Rule G-32 with respect to municipal fund securities will ease burdens on broker-dealers without reducing transparency for investors. In fact, applying the MSRB’s current e-delivery standard to municipal fund securities likely will allow investors in 529s, ABLE programs, and LGIPs to more easily track and understand these disclosures as they change over time through regular amendments or supplements. Of course, even if the MSRB adopts “access equals delivery” as the default delivery method, investors that prefer to receive physical documents in the mail would have that option preserved and may request a physical copy from their broker-dealer.

As stated in the Notice, when the MSRB adopted the e-delivery standards for municipal debt securities in Rule G-32 in 2009, it did not update the delivery method for municipal fund securities. This approach was consistent with the policy adopted at that time by the Securities and Exchange Commission (the “Commission”) with respect to mutual fund disclosures based on the characteristics and structures those investments share with municipal fund securities. Since then, however, the Commission has updated its default method for delivery of mutual fund prospectuses, using an “optional layered” approach while allowing online access to satisfy delivery obligations in some circumstances.⁵

However, the MSRB should not adopt a default delivery method that uses a “supplemental layered” approach similar to the requirement for mutual funds in the Commission’s Rule 498.⁶ The MSRB should treat municipal fund securities and municipal debt securities equally in this context because, as stated in the Notice, unlike various Commission rules regarding prospectus delivery requirements, “MSRB rules relating to disclosures for municipal fund securities operate within the same framework as MSRB disclosure rules for municipal debt securities.”⁷ Therefore, consolidating the delivery obligations for municipal fund and municipal debt securities using “access equals delivery” as the single default standard will streamline and clarify the requirements for both investors and dealers.⁸

Investor attitudes also have evolved since the MSRB last updated Rule G-32 in 2009. For example, as the SIFMA e-Delivery YouGov Survey cited in the Notice demonstrated, a significant majority of investors are comfortable with e-delivery as the default method for financial documents.⁹ Therefore, modernizing the MSRB’s rules to adopt “access equals delivery” as the default delivery method for municipal fund securities generally will align with investor expectations and will not diminish the effectiveness or availability of these important disclosures.

1. SIFMA is the leading trade association for broker-dealers, investment banks and asset managers operating in the U.S. and global capital markets. On behalf of our industry’s one million employees, we advocate on legislation, regulation and business policy affecting retail and institutional investors, equity and fixed income markets and related products and services. We serve as an industry coordinating body to promote fair and orderly markets, informed regulatory compliance, and efficient market operations and resiliency. We also provide a forum for industry policy and professional development. SIFMA, with offices in New York and Washington, D.C., is the U.S. regional member of the Global Financial Markets Association (GFMA). For more information, visit http://www.sifma.org. [↩]
2. Terms not defined herein are as defined in MSRB Notice 2024-15, Concept Release: MSRB Requests Comment on Potential Modernization of Municipal Fund Securities Disclosure Obligations, available at https://live-
   msrb.pantheonsite.io/sites/default/files/2024-12/MSRB-Notice-2024-15_1.pdf. [↩]
3. See letters from David L. Cohen, Managing Director & Associate General Counsel, SIFMA to Ronald W. Smith, Corporate Secretary, MSRB, at 4 (Aug. 26, 2011), available at https://www.msrb.org/sites/default/files/2024-06/SIFMA%20Letter_2011-33.pdf; (Apr. 2, 2012), available at https://www.msrb.org/sites/default/files/RFC/2012-10/SIFMA.pdf. SIFMA also supports adoption of e-delivery of investor financial disclosures more broadly. See, e.g., SIFMA Welcomes Introduction of the E-delivery Legislation, SIFMA Press Release (Mar. 28, 2025), available at https://www.sifma.org/resources/news/press-releases/sifma-welcomes-introduction-of-the-e-delivery-legislation-2/. [↩]
4. See letter from Leslie M. Norwood, Managing Director & Associate General Counsel, SIFMA to Ronald W. Smith, Corporate Secretary, MSRB, at 4, 8-9 (Apr. 17, 2023), available at https://www.msrb.org/sites/default/files/2023-04/SIFMA-2023-02.pdf. [↩]
5. Notice at n. 27 and accompanying text. [↩]
6. Notice at 10. [↩]
7. Notice at n. 16. [↩]
8. In addition to publishing the official statement on EMMA, as described in the Notice, the MSRB’s access equals delivery standard for municipal fund securities also could allow delivery to be satisfied through posting on the relevant 529 plan, ABLE program, or LGIP public website, as investors in municipal fund securities regularly access their account information via those websites. See, e.g., Letter from Mary G. Morris, Chair, College Savings Plan Networks (“CSPN”) to Ronald W. Smith, Corporate Secretary, MSRB (Apr. 2, 2025) (“CSPN Comment Letter”) (proposing a modified Access Equals Delivery Alternative “that requires notice of posting of Plan Disclosure Documents on EMMA and on the 529 Plan’s public website”), available at
   https://www.msrb.org/sites/default/files/2025-04/CSPN-2024-15.pdf. [↩]
9. Notice at 13-14. [↩]