If the issue is $1 million or less or if no legally acceptable bids are received at the first public offering, the bonds may be sold at private sale within 60 days after the advertised date for public bidding, as long as terms are substantially similar.

If the issue is $1 million or less or if no legally acceptable bids are received at the first public offering, the bonds may be sold at private sale within 60 days after the advertised date for public bidding, as long as terms are substantially similar.

• A. True
• B. False
• C. It is 10 days
• D. 90 days

Answer: (B)

When a municipal bond issue is small (usually $1 million or less) or there are no legally acceptable bids at the first public offering, the bonds may be sold by private sale to avoid delaying the financing. The important detail is the allowable time frame for that private sale: it must occur within 90 days after the advertised date for public bidding, and the terms must be substantially similar to those of the public bid. A 60-day window is not permitted, which is why the statement is false.

When a municipal bond issue is small (usually $1 million or less) or there are no legally acceptable bids at the first public offering, the bonds may be sold by private sale to avoid delaying the financing. The important detail is the allowable time frame for that private sale: it must occur within 90 days after the advertised date for public bidding, and the terms must be substantially similar to those of the public bid. A 60-day window is not permitted, which is why the statement is false.