The Bond Buyer Municipal Bond Index is based on prices for 40 long-term municipal bonds. The index is calculated by taking price estimates from Standard & Poor's Securities Evaluations for the 40 bonds, converting them to fit a standard 6% coupon, averaging the converted prices, and multiplying the result by a smoothing coefficient that compensates for the changes made twice a month in the index's composition.

There are three versions of the index: Version A, which ran from July 2, 1984, through Feb. 28, 1995, used coupons standardized to 8% and a coefficient that began at 1.0000 on July 2, 1984. Version B, which ran from March 1, 1995, through July 31, 1999, used an 8% standard coupon but reset the coefficient back to 1.0000 on March 1, 1995. Version C, which has run from Aug. 2, 1999, to the present, uses a 6% standard coupon and started with a coefficient of 1.0000 on March 1, 1995.