PUBLIC FINANCE

Case Studies

Helping Chicago’s public transit agencies implement an innovative fare payment system

Bond Counsel

For more than 15 years, we have served as bond counsel to a University, aiding in the formation of a pooled system of the University’s auxiliary facilities, included parking, student housing, dining, and a recreational facility. This system facility structure has resulted in enhanced credit structure, as opposed to stand-alone financings. We also assisted the university when it consolidated the financing of its hospital and clinic system into the system facilities, acting as lead counsel in drafting the bond and other documents and providing opinions as to the legality, enforceability and tax-exempt status of the financing.

We served as bond counsel in the financing of the I-470 and 350 Transportation Development District transaction, a project located northwest of Kansas City and consisting of an approximately 722,000 square foot “power” retail center known as SummitWoods Crossing. The firm drafted various financing documents related to the issuance of the bonds, reviewed inter-governmental agreements pertaining to the District’s imposition of a 1% sales tax and provided opinions as to the legality, enforceability and tax-exempt status of the bonds. Tax increment financing was also utilized in connection with this project.

Thompson Coburn lawyers served as bond counsel to Chicago Public Schools (CPS) in matters involving the structuring, issuance and sale of $409,555,000 in alternate revenue bonds to build new schools and fund other capital projects.

Crossings Community Improvement District relied on Thompson Coburn as bond and disclosure counsel when the District provided financing for infrastructure and site improvements in connection with the Wildwood Town Center redevelopment project in Wildwood, Missouri. The District encompasses an area of 19.5 acres within an approximately 820-acre site. The total estimated budget for completion of the Town Center—which consists of a combination of retail, residential, restaurant and office space, as well as a hotel/conference center—was $70 to $75 million. This financing was the first in Missouri in which a transportation development district utilized all three available sources of revenue (sales tax, real property tax and special assessments) to finance the costs of public improvements within the district. As bond counsel, the firm drafted various financing documents, reviewed and negotiated amendments to the original development agreement for the project, and provided opinions as to the legality, enforceability and tax-exempt status of the bonds. As disclosure counsel, the firm conducted due diligence, drafted the offering document and provided a legal opinion regarding the offering document and the anti-fraud provisions of the federal securities laws.

The firm represented one of the nation’s largest transit systems, when it closed a Lease-Purchase Agreement to provide financing for the construction and purchase of 150 buses. This bus lease-purchase was the first of its kind for the agency and provided cost effective funding at tax-exempt interest rates. The firm served as special counsel to the agency in structuring and documenting the financing, and was lead counsel in drafting the lease and other financing documents. Our attorneys also offered opinions as to the legality, enforceability and tax-exempt status of the financing, as well as to the perfection of security interests in the buses and other collateral that secured the transaction.

The Francis Howell R-III School District in St. Charles County, Missouri, engaged Thompson Coburn to serve as bond and disclosure counsel in financings that totaled more than $50 million in general obligation refunding bonds of the District. As bond counsel, the firm performed diligence on the District’s debt structure, collaborated with the underwriters for each series of bonds regarding various state law and federal tax issues that arose during the refinancing, drafted all of the legal documents and rendered a bond counsel opinion regarding the legality, enforceability and tax-exempt status of the bonds. As disclosure counsel to the District, our attorneys performed due diligence with respect to the District, drafted the offering documents for the transaction and rendered an opinion regarding the offering document and the anti-fraud provisions of the federal securities laws.

As bond counsel for a growing community Missouri since 1980, Thompson Coburn has worked to structure inventive bond financings that fund its mounting capital needs. The approximately $48 million of Special Obligation Bonds that the city issued have a unique structure in that they are secured solely by the non-binding commitment of the City Council to annually appropriate funds to pay debt service. These bonds are generally paid from earmarked capital improvement sales taxes approved by the voters for specific projects. In addition, the City has funded capital projects for a municipally owned Water and Electric System through the issuance of approximately $160 million of voter-approved Water and Utility System Revenue Bonds that are payable from water and electric utility revenues.

Underwriter’s/Disclosure Counsel

Since 1996 Thompson Coburn has represented the team of underwriters selected by The State Environmental Improvement and Energy Resources (EIERA) for its bond issues to finance loans through the Missouri State Revolving Funds Program (SRF). The SRF provides below-market loans to Missouri cities, counties, and water or sewer districts for construction of wastewater and drinking water projects. Our lawyers have counseled the underwriters in connection with the public offering and sale of bonds in more than 30 financings through the SRF Program. We have also advised the team of underwriters chosen by the EIERA for bonds issued through the Energy Program in three financings. In connection with each financing, our attorneys conducted due diligence on each of the borrowers, reviewed program documents, and drafted disclosure documents.

Thompson Coburn advised a team of underwriters in structuring and implementing a multi-lien financing plan to maximize the principal amount of debt that could be secured by Amendment 3, a constitutional amendment which earmarked a portion of existing tax revenues generated by cars and other motor vehicles to fund an approximately $1.8 billion “Smoother, Safer, Sooner” statewide road and bridge construction program. The availability of the Amendment 3 revenues was phased in over four years. The financing plan included refunding of existing debt with Senior Bonds secured pursuant to the provisions of the Constitution prior to Amendment 3 (necessary to accommodate the new financing structure), First Lien fixed rate Bonds, Second Lien fixed rate Bonds, and Third Lien variable rate Bonds.

Thompson Coburn lawyers served as underwriter’s counsel in connection with the construction of the Lake of the Ozarks Community Bridge. This matter involved the first issuance of Toll Revenue Bonds in the State of Missouri under the Transportation Corporation Act. As advisors to the underwriters, our lawyers played a pivotal role in structuring and implementing a financial plan to fund the required project costs and provide for construction reserves and interest on the bonds during the construction and start up of the Bridge operations. The firm served in a similar capacity in connection with the issuance of refunding bonds designed to restructure the financing after the Bridge project was completed.

Since 2005, Stifel, Nicolaus & Company has turned to our lawyers to help structure and implement innovative public finance transactions for Lewis and Clark Community College. The College's Series 2005A Bonds were issued using a unique structure often referred to as “Cinderella Bonds,” which are initially issued at a taxable interest rate, and then at a future date are converted to a tax-exempt interest rate at the election of the college. The College's Series 2007A Bonds restructured certain outstanding debt of the College to achieve interest cost savings. They also funded a portion of the costs of construction of the National Great Rivers Research and Education Center.

Thompson Coburn has been underwriter’s counsel for a financial services company in multiple bond financings for Olathe Medical Center in Olathe, Kansas. In this role, we assisted the underwriter in both the structuring and documentation of fixed rate and variable rate bond financings, and negotiation of credit enhancement. The Medical Center has expanded in keeping with the needs of the community, and its financings have grown proportionally both in size and complexity.

Our attorneys recently served as counsel to the underwriter of the bond issues that financed much of the construction costs of The Kauffman Center for the Performing Arts, a corporation that was formed to research, plan and design a world-class performing arts center for the Kansas City metropolitan area.

Thompson Coburn served as underwriter’s counsel in a matter involving the issuance of revenue bonds for a multi-family housing development in the City of St. Louis. The bonds were issued through the Missouri Housing Development Commission, and were enhanced with a Fannie Mae guaranty, resulting in cost savings to the borrower for much-needed affordable housing in a disadvantaged neighborhood.

Issuer’s Counsel

Since 1998, one of the country’s largest secondary student loan markets has relied on Thompson Coburn as its primary outside counsel. In this role, the firm has negotiated non-bond financings, including $1 billion conduit financing and various lines of credit ranging in the hundreds of millions of dollars.

An Authority that assists nonprofit and public health and educational institutions in borrowing funds for capital projects, has depended on Thompson Coburn as its primary outside counsel for over 20 years. Our attorneys have advised the Authority on more than 200 financings involving over $5 billion in bonds, and have assisted in the development and implementation of the Authority’s various programs, including its HELP Loan Program and Direct Deposit Program.

Thompson Coburn served as counsel to a large metropolitan public transit agency advising on public finance, general contract, administrative, real estate, employee benefits, and litigation matters. In addition, the firm has served as Bond Counsel, Underwriter’s Counsel and Issuer’s Counsel in connection with numerous tax-exempt financings for the agency’s transit system and other capital projects and has represented the agency in issues pertaining to sale-leaseback and other financing transactions.

Lender/Letter of Credit Bank Counsel

Our attorneys served as letter of credit bank counsel in connection with more than $400 million in bond and other financings for PeaceHealth, an integrated multi-state hospital and health care system in the Pacific Northwest. The bonds were structured as variable rate securities issued by two state authorities, and were enhanced by bank letters of credit provided by a syndicate of multiple banks led by two issuing banks. The firm documented both the bond letter of credit materials, as well as the bank syndicate materials. Our attorneys also represented the bank group agent in connection with a bridge line of credit that allowed the hospital system to access the credit markets in advance of the bond financing in order to avoid rising interest rates on its existing bond indebtedness.

Our lawyers represented U.S. Bank National Association when it purchased $6 million of multifamily housing revenue bonds in order to finance the acquisition and rehabilitation of an existing affordable housing community in suburban St. Louis. The bond structure resulted from the State’s allocation of scarce private activity volume cap for a portion of the financing, and allowed for the remainder of the project costs to be financed on a taxable basis.

We served as bank counsel to U.S. Bank National Association in connection with the issuance of variable rate revenue bonds to finance the acquisition and construction of low and moderate-income apartment facilities in two Southwest Missouri communities. The structure involved the issuance by the bank of letters of credit enhancing the tax-exempt revenue bonds and resulted in significant interest savings to the developer for both the construction and permanent financing of the project.