….Congress generally has supported policies to encourage credit access for state and local public-sector entities. This report informs Congress about various developments related to the demand for municipal bonds. Beginning with investor holding trends, the household share of municipal bondholders has decreased whereas the share of various financial intermediaries holding municipals, particularly depository banking institutions, has increased. Changes in the composition of investors could be related to several types of financial risks (e.g., interest rate, liquidity, default). Likewise, various regulatory developments also influence the profitability of municipal bonds for different bondholder types, and thus their willingness to hold these securities. This report also presents concerns expressed by the Securities and Exchange Commission (SEC) regarding the need for improved disclosures to inform investors about the financial health of municipal issuers and consistent accounting practices…..