04/15/2014

Are You Free of Your Tax Bill for the Year?

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As you put the 2013 tax season behind you, think about how much of what you earn is allocated to pay taxes each year. This year, Americans will pay a total of $4.5 trillion, or 30.2% of their income in taxes. Consider how many days of work will be dedicated to paying that bill. Every year the Tax Foundation1 establishes Tax Freedom Day®, which marks the day when the nation has earned enough money collectively to pay its total tax bill. For 2014, Tax Freedom Day® falls on April 21st; three days later than 2013 due to the country’s...

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04/08/2014

Municipal Bonds: Better Than You Think

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For many years, the municipal bond market has provided investors with the benefit of earning income that is generally exempt from both federal and state income taxes. While several headline topics have raised concerns among municipal bond investors in recent years, our evaluation of current economic and market factors indicates to us that the condition of the municipal bond market may be better than you think.

Our new white paper, Municipal Bonds Better Than You Think, takes a look at the economic and market factors that have influenced the municipal bond market over the past several years, and reviews...

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04/04/2014

One Hundred Years of the Federal Income Tax

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It was 100 years ago this year that the first Form 1040 was sent out to taxpayers as ratification of the Sixteenth Amendment to the US Constitution made it possible for the federal government to tax personal incomes.

The new tax started at 1% on personal incomes of more than $3,000 (over $71,000 in today’s dollars) for single filers or $4,000 for couples and included a surtax of 6% on incomes over $500,000. Taxpayers were required to complete the new form and submit it to local tax collectors for review by...

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04/03/2014

We Express our Appreciation to a Retiring Trustee

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We would like to express our appreciation to a trustee who has recently retired from various fund boards after having served shareholders for many years.

Anne Mills became a trustee on the board of Aquila Tax-Free Trust of Arizona at the inception of the fund in 1986, and joined the boards of Aquila Tax-Free Fund of Colorado and Aquila Churchill Tax-Free Fund of Kentucky when both funds were launched in 1987.  In later years, she also joined the boards of Aquila Narragansett Tax-Free Income Fund and...

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03/28/2014

Celebrating Our 30th Anniversary

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Our History, People and Distinctive Strategy

Diana P. Herrmann, President & CEO, Aquila Investment Management LLC

Lacy Herrmann, Aquila’s founder, was one of the earlier pioneers in money market funds beginning in the mid-1970s. By the early 1980s, a handful of state-specific municipal bond mutual funds were being offered in states with large populations and higher tax rates, such as California, New York and Massachusetts.  Mr. Herrmann was intrigued with the concept of launching similar funds in other states.

Since the...

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03/27/2014

Individual Stock Selection

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Individual stock selection and active management are strategies that returned to prominence recently, according to a March 9, 2014 Wall Street Journal article.  “After years of moving in lock step on the back of global economic shocks, individual stocks increasingly have been dancing to their own tune” as evidenced by the steep decline seen in correlations1 between individual stocks in the S&P 500 since the financial crisis.

S&P Dow Jones Indices looks at active management from a different perspective in their S&P Indices Versus Active Funds or SPIVA Scorecard, which evaluates the performance of active versus passive management...

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03/07/2014

A New Tax Confronts High Income Taxpayers

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“The only things certain in life are death and taxes.” ~ Benjamin Franklin

Starting with the 2013 tax year, high income taxpayers will be subject to a new tax; the 3.8% Net Investment Income Tax (NIIT).  Instituted under the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010, this tax is in addition to regular taxes and will be imposed on filers with Modified Adjusted Gross Income (MAGI) over certain thresholds.

The good news for investors in municipal bonds is that the interest income from a municipal bond is generally exempt from federal income...

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02/26/2014

University of Colorado Requests that S&P Remove Credit Ratings from Debt

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On January 13, 2014, Standard & Poor’s Ratings Services withdrew all its ratings from the University of Colorado and University of Colorado Board of Regents’ debt at the request of the issuers.  The University was last rated AA- by S&P and is currently rated Aa2 by Moody’s and AA+ by Fitch.  Since the S&P ratings were withdrawn at the issuer’s request due to the expense of maintaining the ratings and not for credit related reasons, this change is not a cause for concern.

However, this decision is notable for an entity the size...

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02/25/2014

Oregon Taxpayers Reap Savings from School Bond Program

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In its 2014 Legislative Update, the Oregon State Debt Policy Advisory Commission recently reported an estimate suggesting that the Oregon School Bond Guaranty Program has saved Oregon taxpayers approximately $6.0 million per year, or $120 million over a twenty year period.  This State guaranty applies to local school district and community college debt service payments of $407 million, which is equivalent to approximately 5.9% of total General Fund revenues for the fiscal year, and 12.4% of overall state aid for schools and community colleges.

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02/06/2014

Hawaii – Positive Economic News

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The Hawaii Tourism Authority reported on January 30, 2014 that Hawaii visitor arrivals in 2013 set a new record of 8.24 million visitors for the year.  This represents an increase of 2.6% over 2012. Annual total visitor expenditures also increased 2% to $14.5 billion. Arrivals from the mainland were up slightly over 2012, while arrivals from Japan rose 3.9% and arrivals from Canada grew by 2.1%.  Arrivals from smaller visitor markets (Oceania, Europe, Latin America) continue to show strong growth rates.

After another record-setting year for tourism and continued growth in construction, the state reported an increase in net assets...

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