One paper, one published article and one transcript of testimony that discuss school finance under the Internal Revenue Code of 1986 are presented. "Select Topics of the Tax Reform Act of 1986 for the Issuers of Tax-Exempt Governmental Obligations," by Carla J. Smith, presents three selected topics that address the issuers of tax-exempt governmental obligations. Included are the issue of rebate, which refers to payment to the federal government of all of the net earnings on investments; bank-qualified issues that have changed recently; and a new informational form required with all tax-exempt governmental debt in excess of $100,000. Next, an article reproduced from the publication "The Bottom Line," entitled "Congress and Courts Deprive States of Sovereign Power: The Power to Tax Is the Power to Destroy," by John L. Kraft and Felicia L. Garland, questions the apparent abandonment of sovereign state powers through federal judicial review of taxation based on municipal bond income for senior citizens who are receiving Social Security. Last, testimony by John L. Kraft on the "Tax Reform Act of 1986," delivered before the Economic Development and Agriculture Committee of the New Jersey State Assembly is presented. This testimony discusses federal legislation restricting the use of tax exempt bond financing by state and local governments and concludes by addressing the constitutionality of the federal government's power to tax interest on state and municipal bonds. (LMS)