The Official Statement published for a new municipal issue:

• A. solicits bids from interested underwriters
• B. is a disclosure document for use by potential investors
• C. is an advertisement for the issue by the municipality
• D. establishes the procedures for calculating reoffering scales

Answer: (B)

The Official Statement is the primary disclosure document for potential investors. It provides detailed information about the issuer, the bond issue, security for repayment, sources of payment, financial statements, and risks so investors can evaluate the investment. It isn’t used to solicit bids from underwriters—that step happens through the underwriting process—nor is it merely an advertisement. While it may include pricing information like reoffering yields, it does not establish the procedures for calculating the reoffering scale; that is determined by the underwriters during pricing.