Public Finance

BOND COUNSEL AND OTHER REPRESENTATIONS

Phillips Lytle is listed in the Municipal Bond Attorneys section of The Bond Buyer’s Municipal Marketplace (the “Red Book”) as a public finance firm with bond counsel opinions that are accepted within the marketplace. Our Public Finance Practice Team is comprised of highly experienced bond and tax attorneys who have been involved in an impressive list of public finance transactions. Members of our Public Finance Practice work in all of our firm’s offices and counsel clients in connection with the issuance and structuring of debt for a broad range of New York public finance transactions. In addition to serving as bond counsel for debt obligations issued by New York state and local government issuers, we also represent domestic and foreign letter of credit issuers, underwriters, private placement agents, corporate and not-for-profit obligors, and trustees.

Our work and experience in public finance extends to collateral and post-issuance matters such as preparation of post-issuance compliance written procedures and training of issuer and conduit borrower representatives responsible for monitoring post-issuance compliance; representation of issuers and conduit borrowers before the Internal Revenue Service on matters relating to the federal tax status of tax-exempt and tax-advantaged bonds, including the Voluntary Closing Agreement Program and audits by the Tax Exempt Bond section of the IRS; and advice concerning post-issuance arbitrage and arbitrage rebate matters.

We have worked on financings for state agencies, local governmental units, special public benefit corporations, not-for-profit corporations, and private entities and banks, as well as on financings involving the privatization of governmentally owned facilities.

In our capacities as disclosure counsel and bond counsel, we prepare the pertinent sections of official statements, private placement and offering memoranda, reoffering circulars and other disclosure documents. We are well versed in relevant SEC and MSRB requirements, including SEC Rule 15c2-12.

LOCAL GOVERNMENT GENERAL OBLIGATION BONDS AND NOTES

General obligation bonds and notes are obligations secured by the full faith and credit of the issuer and, among other things, a pledge of the taxing power of the issuing municipality or school district. General obligation bonds, bond anticipation notes and tax and revenue anticipation notes are issued for capital and working capital needs. In connection with these matters, our attorneys draft and prepare all necessary documentation, including bond resolutions and ordinances, notices of sale, official statements to provide investor disclosure, purchase contracts, certificates of determination and undertakings to provide continuing disclosure.

PROJECT FINANCING

We have acted as bond counsel in connection with tax-exempt and taxable governmental bonds, qualified 501(c)(3) bonds, exempt facility bonds, special tax-advantaged bonds including tax credit bonds, and industrial development bonds, as set forth below.

• Acquisition of a municipal hospital system by a public benefit corporation
• Alternative energy facilities
• Convention centers and sports facilities
• Correctional facilities
• Court facilities
• Electrical power generating facilities (local generation)
• Facilities for not-for-profit corporations
• Higher education facilities
• Hospitals and nursing homes (including hospital equipment loan programs)
• Housing (including market rate, affordable, subsidized and assisted living programs)
• Industrial development projects for manufacturing and other facilities
• Public school facilities, including charter schools
• Small business loan programs
• Solid waste and resource recovery facilities
• Water and sewer facilities

FINANCING ARRANGEMENTS

We routinely handle both general obligation bonds that are secured by the ad valorem taxes of the local governmental unit that is issuing the bonds, as well as revenue bonds that are payable from, and secured by, assets and/or revenues.

Our attorneys are well versed in all types of municipal financing, including:

• Auction rate obligations
• Conduit transactions
• Debt backed by state appropriations or secured by state-funded intercepts
• Excise tax revenue obligations
• Obligations secured by revenue derived from a loan pool
• Obligations secured by the guarantees or other support of public bodies
• Project revenue obligations
• Public-private partnerships
• Tax-exempt lease/purchase obligations
• Traditional governmental general obligation bonds and notes (including tax-advantaged debt)
• Variable rate obligations supported by credit and liquidity facilities

COMPLEX AND DEVELOPMENT PROJECTS

When it comes to Major Development Project Financing (MDPF), our Public Finance Team draws upon the expertise and depth of our other practice teams. MDPF may include public-private partnerships and facilities that are owned and/or operated by 501(c)(3) organizations in conjunction with governmental or private use. The focus of MDPF involvement may be to maximize the use of tax-exempt financing and to assure maximization of other forms of federal, state and local assistance; securitization of assets and revenues; and compliance with environmental requirements, including SEQRA environmental impact analysis and inter-related public (and private) approval and support. MDPF is usually used on high-value, multi-purpose developments that involve, but are not restricted to, those that contain more than one of the following:

• Airports (including training facilities)
• Commercial buildings
• Health care and educational facilities
• Low- and moderate-income residential rental properties
• Private sewage and solid waste disposal
• Public use components, such as roads, public water, and sewers and parks
• Single and multifamily housing

OTHER OPERATING, FINANCING OR SECURITY ARRANGEMENTS

In addition to public-private partnerships, Phillips Lytle has structured and documented complex ownership, operation and use arrangements that utilize tax-exempt and other tax-advantaged financing, including pool financing, lease-purchase arrangements, true leases, short-term private use arrangements and operating agreements with private businesses for operation and management of governmental and qualified 501(c)(3) financed facilities.

PILOT AGREEMENTS

Even in those cases where tax-exempt financing is not the main objective, the Public Finance Team is able to help arrange and document Payment in Lieu of Taxes (PILOT) agreements with local economic development entities to promote economic development. PILOT agreements can often result in substantial savings on local property, sales and use, and other locally imposed taxes. The arrangements can also be leveraged into long-term taxable or tax-exempt debt structures.

CORPORATE RETENTION

We are sensitive to the necessary balance between the competing interests in any corporate retention program, and can structure arrangements that satisfy Industrial Development Agency (IDA) and municipal public purpose objectives to promote employment that takes into account the local employer’s cost savings needs. When representing local employers, we are able to focus on, and help evaluate, bottom- line decisions that must be made in a possible relocation scenario. Our Public Finance attorneys pride themselves on crafting arrangements that result in win-win situations.

UNDERWRITERS’ COUNSEL

Phillips Lytle attorneys have served as Underwriters’ Counsel in a variety of transactions. We have extensive experience in the preparation of official statements and private placement memoranda and other investor disclosure, as well as the preparation and negotiation of bond purchase and bond owner contracts.

Some of the types of transactions in which Phillips Lytle attorneys have served as Underwriters’ Counsel include:

• Highway and bridges trust fund revenue bonds issued by a state highway authority.
• Airport revenue bonds issued by a regional transportation authority in connection with an international airport.
• The initial issuance of a taxable securitization financing program for a state agency issuer involving the securitization of business development loans.
• Revenue bond transactions to finance solid waste and resource recovery facilities, affordable housing facilities, utility projects, manufacturing facilities and not-for-profit projects.
• Tax-exempt project finance transactions to finance water and waste facilities owned by local public authorities.
• The initial public offering on the credit of a not-for-profit corporation to provide it with facilities to evaluate, treat and house distressed juveniles.
• Revenue bonds issued to finance a sports coliseum project, which involved the participation of a private operator in a publicly owned facility.
• The issuance of industrial development bonds secured by project revenues of a privately owned airport hotel, such bonds representing the initial public offering for such credit and issued on an unrated basis.
• Revenue bonds issued to finance the construction of charter school facilities.

BOND WORK

Our bond work during the last several years includes:

• Town of Hempstead $19,945,000 Public Improvement Refunding Serial Bonds, 2021.
• Town of Hempstead $140,048,572 Public Improvement Serial Bonds, 2021.
• Town of Hempstead $42,107,700 Bond Anticipation Notes, 2020.
• Erie County Fiscal Stability Authority $92,115,000 Sales Tax and State Aid Secured Bonds, Series 2017D.
• Erie County Fiscal Stability Authority $62,745,000 Sales Tax and State Aid Secured Refunding Bonds, Series 2017C.
• Erie County Fiscal Stability Authority $11,590,000 Sales Tax and State Aid Secured Bonds, Series 2017B.
• Erie County Fiscal Stability Authority $32,075,000 Sales Tax and State Aid Secured Bonds, Series 2017A.
• NYS Environmental Facilities Corp. Clean Water State Revolving Fund Bonds ($8,762,867 — Town of Tonawanda), Series 2017A.
• JP Morgan Chase Bank, N.A. purchase of $995,000 Town of Livonia, Livingston County Public Improvement Bonds, 2017.
• JP Morgan Chase Bank, N.A. purchase of $1,725,000 Village of Nyack, Rockland County Statutory Installment Bond, 2017.
• Nassau County Local Economic Assistance Corp. $3,064,000 Revenue Bonds (EPIC 2016).
• Nassau County Local Economic Assistance Corp. $7,786,000 Revenue Bonds (UCP 2016).
• Town of Tonawanda $20,175,000 Bond Anticipation Notes, 2016.
• Nassau County Local Economic Assistance Corporation $13,632,000 Revenue Bonds (Alliance of Long Island Agencies Pooled Facility), Series 2015.
• Town of Tonawanda $19,525,000 Bond Anticipation Notes, 2015.
• Chautauqua Lake Central School District $2,515,000 Bond Anticipation Note, 2013.
• Suffolk County Economic Development Corporation $4,837,000 Taxable and Tax-Exempt Revenue Bonds (ACLD Project) Series 2012B-A, B-B and B-C.
• MBBA/City of Buffalo $13,860,000, Series 2012A Bonds.
• Erie County Fiscal Stability Authority $130,750,000 Sales Tax and State Aid Secured Bonds, Series 2011A, 2011B and 2011C.
• Town of Tonawanda $11,000,000 Bond Anticipation Note, 2011.
• Chautauqua Lake Central School District $4,375,000 Bond Anticipation Note, 2011-01.
• Town of Tonawanda $10,000,000 Serial Bonds, 2010 and $3,800,000 Bond Anticipation Note, 2010.
• Buffalo Municipal Water Finance Authority $23,975,000 Water System Revenue Bonds, Series 2010¬A(1) and Series 2010-A(2).
• Town of Amherst Local Development Corporation $29,000,000 Student Housing Facility Revenue Refunding Bonds (UBF Faculty Student Housing Corp. Project), Series 2010A.
• Genesee County Funding Corporation $3,900,000 Tax-Exempt and Taxable Revenue Bonds (2010 Genesee Gateway Local Development Corporation — MedTech Project).
• City of Glen Cove, NY $2,597,000 Bond Anticipation Notes.
• Nassau County Industrial Development Agency $55,000,000 Civic Facility Revenue Bonds (Cold Spring Harbor Laboratory Project), Series 2006.
• City of Glen Cove, NY $2,445,000 Bond Anticipation Notes, Series 2006.
• Nassau Regional Off-Track Betting Corporation $21,810,000 Revenue Bonds (Nassau County Support Agreement), Series 2005.
• Dormitory Authority of the State of New York $28,840,000 Canisius College Insured Revenue Bonds.
• Briarcliff Manor Union Free School District $3,585,000 School District Refunding Bonds.

Phillips Lytle’s first-time and innovative issuer experience:

• Acted as Bond Counsel to the Erie County Fiscal Stability Authority from its inception.
• Acted as Counsel to Placement Agent in the issuance of $21,750,000 of taxable notes issued by a limited partnership to finance the reconstruction of Hotel Thayer at the U.S. Military Academy in West Point, NY. The notes, limited recourse obligations of the limited partnership, were guaranteed by the U.S. Army Morale, Welfare and Recreation Fund (the Fund’s first employment ever as a financial guarantor). The Fund is a non-appropriation fund instrumentally of the U.S. Government.
• Acted as Underwriters’ Counsel in connection with initial issuance of $320 million of bonds secured by project revenues and district service charges as the initial project financing for the Palm Beach, FL Solid Waste Authority to finance solid waste and resource recovery facilities. This required the preparation and development of an extensive official statement disclosure document.
• Represented the City of Glen Cove in its first issuance of general obligation debt for a private use facility in a public-private partnership.
• Represented the Nassau Off-Track Betting Corporation in its issuance of $8,200,000 of Bond Anticipation Notes as a first-time issuer.
• Participated as Bond Counsel in the development of an innovative (first-time) financing in which a not-for-profit corporation “civic facility” financing under the New York State Industrial Development Agency Act was linked to “true lease” government users of the bond-financed facility. Extensive legal research was required in order to determine if the issuer, the Yonkers Industrial Development Agency, was empowered under the New York State Industrial Development Agency Act to undertake this transaction.
• Acted as Underwriters’ Counsel in the acquisition of a New York county hospital system by a newly formed public benefit corporation in connection with the first-time issuance of bonds by such corporation.
• Drafted and negotiated legislation to substantially recast and expand powers of Minnesota Energy and Economic Development Authority to finance projects and secure its debt. The legislation was subsequently validated by the Minnesota Supreme Court in a special constitutional test case.
• Created two separate securitization financing programs for Minnesota Energy and Economic Development Authority — one involving the establishment of a state-funded guarantee fund to secure bonded debt of the Authority issued to finance loans for energy, pollution control or small business development purposes, and the other involving the issuance of taxable debt to buy a portfolio of secondary market loans guaranteed by the U.S. Small Business Administration. Both programs involved serving as Bond Counsel in connection with initial bond issuance for such programs and creating all necessary bond documents.
• Acted as bond counsel to the Nassau County Local Economic Assistance Corporation from its inception.

Phillips Lytle is proud to be recognized by U.S. News & World Report and Best Lawyers^® with a National Tier 3 ranking for its Public Finance Law practice on the Best Law Firms^® 2022 list.

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