To do more with limited financial resources, issuers increasingly look to innovative financing structures, including many borrowed from the corporate market.
We have helped clients navigate the municipal securities market with various financial structures, including:
- Short-term financing, including commercial paper; grant, bond and tax anticipation notes, including GARVEEs; variable rate demand obligations that combine lower short-term rates with longer nominal maturities; and auction rate securities that do the same while preserving liquidity capacity to meet other needs.
- Structured financing, including tobacco settlement and stranded cost securitizations to monetize future nonessential revenue streams for current use.
- Tax increment financing to capture tax windfalls from other governmental units and share development risks with investors.
- Transfers of tax ownership, including sale- or lease-leasebacks of rail cars, school buses, power plants and other public assets, to taxpayers who can use the benefits of tax ownership.
- Investment pools for state and local government cash reserves to increase liquidity and yield through professional management.
- Financial hedges, including interest rate swaps, to achieve lower-cost or forward-delivery synthetic fixed-rate financings or to reduce expected net debt service on outstanding fixed-rate financings, and commodity hedges to manage energy costs.
- Joint purchasing programs to reduce costs of equipment and supplies, including natural gas and electric energy.