Municipal Securities Rulemaking Board

“All proposed rule changes adopted by the board of directors of the msrb are subject to the filing and approval or review requirements by the securities and exchange commission under section 19(b) of the securities exchange act of 1934.”

“The board of directors of the msrb has an audit committee that is charged with reviewing with management the organization's completed form annually prior to the filing of such form and reporting any findings or conclusions to the board of directors in connection with the board's review of such form. The audit committee and the board of directors conducted their reviews on 1/28/2015.”

“The msrb maintains for its board of directors and its staff: a code of ethics and business conduct policy; a conflicts of interest policy; and, a whistleblower policy with complaint handling procedures, which are available on msrb.org. All board members and staff are trained annually on these policies and must sign an acknowledgment. The msrb has a policy requiring that officers, directors and key employees disclose annually interests that could give rise to conflicts. In connection with the election of new members of the board of directors, each candidate provides information to the msrb concerning potential conflicts of interest. In addition, certain organizational conflicts are effectively prohibited under section 15b(b) of the securities exchange act of 1934 due to the statutory requirements regarding qualification for membership on the board of directors. In particular, public representatives must be independent of any municipal securities broker, municipal securities dealer or municipal advisor. Msrb rule a-3 defines "independent" as having no material business relationship with any municipal securities broker, municipal securities dealer or municipal advisor, including at a minimum not currently or at any time within the last two years being associated with a municipal securities broker, municipal securities dealer or municipal advisor and not having a relationship with any municipal securities broker, municipal securities dealer or municipal advisor, whether compensatory or otherwise, that reasonably could affect the independent judgment or decision making of the individual. The msrb's general counsel reviews the conflicts of interest acknowledgement and disclosure forms and determines what actions, if any, need to be taken, including asking a board member to recuse him or herself from deliberations or voting on an action.”

“Under the msrb written compensation strategy and program, the finance committee (comprised of members of the board of directors) is responsible for making recommendations and the board of directors is responsible for approving the organization-wide compensation strategy. The annual salary budget is approved by the board of directors. At least once every four years, the compensation strategy and structure are reviewed and approved by the finance committee based on information received from an external salary consultant. The external salary consultant compares our organization with comparable peer organizations in our local geographic market and within the industry as appropriate. The full board approves the compensation of the executive director, and the executive director establishes the compensation of the key employees within the parameters and philosophy of the approved compensation strategy. Additionally, the executive director annually provides to the board the salary, benefits, and total compensation of the senior management.”

“The organization's website (www.msrb.org) contains the following: securities exchange act section 15b (establishing statute), restated articles of incorporation, by-laws, governance-related administrative rules, board committee charters, code of ethics and business conduct, conflicts of interest policy and disclosure form, risk management program, whistleblower policy, audited financial statements, irs form 990 and certain financial policies.”

“No officer, director, trustee, or key employee has a family relationship or business relationship (as such terms are defined for purposes of form 990) with any other officer, director, trustee, or key employee. As contemplated by the congressionally mandated structure of the msrb's board of directors (which serves as the organization's governing body) as a self-regulatory organization under the federal securities laws, the employers of some members of the board of directors, and such members in their capacities as employees of their employers, from time to time transact business with one another in the ordinary course of their business as participants in the municipal market on the same terms as are generally offered to others in the same line of business.”