NIGP 94902: Arbitrage

NIGP 94902 Arbitrage, an Item code, encompasses annual tax-exempt bond arbitrage rebate calculations and compliance consulting that state and local governments contract to ensure their tax-exempt debt issuances meet Internal Revenue Code Section 148 requirements and maintain tax-exempt status. The work includes annual yield and liability calculations, IRS Form 8038-T preparation, written compliance opinions, regulatory update notifications, rebate amount determinations, and advisory services on yield reduction payments and potential IRS audits. Issuing bodies include county finance divisions, state infrastructure authorities, city finance departments, and water development boards—typically the fiscal officers responsible for managing tax-exempt bond portfolios. Responses typically follow a qualifications-and-cost evaluation model, with firms competing primarily on experience managing municipal bond arbitrage compliance, staffing expertise, calculation methodology, and fee structure rather than on fixed pricing.

Geographic activity spans Florida, Texas, Arkansas, Oregon, and Kentucky based on recent solicitations. Okaloosa County, Florida issued an ITQ for arbitrage consulting services with a July 15, 2026 response deadline; the Texas Water Development Board released an RFQ for arbitrage compliance services covering 39 outstanding bond issues, with proposals due May 28, 2026 and an anticipated contract start of September 1, 2026; the City of Little Rock, Arkansas posted an RFSQ due May 29, 2026 seeking three years of service plus two optional one-year renewals; Collier County, Florida issued an RFP due May 14, 2026 for services across 13 outstanding bond issues with historical annual spending averaging $20,100; the City of Salem, Oregon solicited proposals due April 24, 2026 for eight outstanding tax-exempt bond issues totaling approximately $420.3 million in principal; and the Commonwealth of Kentucky, through the Kentucky Infrastructure Authority, issued an RFP due March 6, 2026 for arbitrage services on four bond series totaling approximately $284.88 million. Contract terms typically run three years with optional one-year or two-year renewals, and most solicitations emphasize experience managing municipal bond portfolios and qualified personnel rather than set-aside designations, though local vendor and minority/women-owned business preferences appear in some evaluations.