Levitt brings light to muni gloom.

WASHINGTON - The escalating hue and cry over finding solutions to the municipal market's political contributions and secondary market disclosure problems makes 1993 look like the worst of times.

But the developments of the last 12 months have been far more positive than they appear and should produce substantial long-term improvements in the market it all the participants will work together.

At long last, the Municipal Securities Rulemaking Board, the Public Securities Association, the Government Finance Officers Association, and a host of state and local groups have been shaken awake by the controversy over influence peddling and mediocre disclosure practices.

While there are disagreements over what to do, 1993 should go on record as a year in which solid steps were finally taken to deal with these nagging problems, rather than letting them fester.

What must be recognized is the catalyst for this progress - the leadership of both Securities and Exchange Commission member Richard Roberts and SEC chairman Arthur Levitt Jr.

In the three years since he became a member of the SEC, Roberts almost single-handedly has been trying to goad dealers, issuers, and the MSRB into getting a grip on numerous market problems, including secondary market disclosure political contributions, pricing, sales practices, and surveillance.

Roberts found a vital ally when Levitt became SEC chairman in July. Levitt's "take charge," consensus-building approach, his trademark when he headed the American Stock Exchange from 1978 to 1989, has already forced the market to take some significant forward steps.

First, he jawboned 17 major bond houses into a voluntary "pay-to-play" ban on contributions. As of last week, that list had grown to 49.

Then he put the heat on the MSRB to toughen its rule banning firms from giving contributions to issuers whose bonds they underwrite and requiring them to provide greater disclosure about the contributions they are allowed to make.

And he took the major step of getting SEC staff members, representatives of the MSRB, issuers, bond lawyers, and underwriters to begin compiling it list of ongoing disclosure items that issuers should have to reveal.

Levitt has gotten the major players to the table and let them know he expects results. His message to the industry is clear: Work with the SEC and other regulators to find solutions or we'll take whatever regulatory or legislative steps are needed to solve them.

If the market, especially the spate of issuers that have decided to fight the curbs on political contributions, will stop bickering and work with Levitt, 1994 will be the beginning of better times and a better market.

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