1. Consult with the State regarding the nature of the bonding program, the Issue, and collect all necessary documentation and investment data. 2. Review documentation for special elections and eligibility for spending exceptions. Determine if, and to what extent, the Issue is subject to the Rebate Requirements, and whether such Issue qualifies for exception(s). 3. Calculate the “yield on the issue” (20 U.S.C. Section 148(f)(2)(A)(ii)). 4. Review and confirm (if requested) prior arbitrage rebate reports for the Issue, if any. 5. Identify, and separately account for, all “Gross Proceeds” of the Issue, including those requiring allocation analyses due to “Transferred Proceeds” and/or “Commingled Funds” circumstances (each as defined by the Code). 6. Review and analyze the investments, funds, and accounts in which the proceeds are held. Determine, as needed, the fair market price or present value of investments. 7. Calculate the Issue's excess investment earnings (cumulative rebate liability), taking into account any other deemed proceeds that are or have become subject to the rebate requirements and all credit and debits required or permitted by the tax regulations. 8. Deliver a comprehensive report, acceptable to the Internal Revenue Service (“IRS”), detailing the tax arbitrage rebate calculations, the rebate liability and any yield restriction issues as well as an opinion letter regarding the calculations for the Issue. The letter shall provide, among other things, that such calculations were performed in compliance with federal tax law. Provide an executive summary identifying the methodology employed, major assumptions, conclusions, and any recommendations for changes in the State’s recordkeeping and investment policy. 9. Prepare and provide for signing and dating a completed Form 8038-T ready for filing with the IRS, and any other required forms. 10. Assist the State as necessary in the event of an IRS or other inquiry.
