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CDFA Bond Finance Update - December 18, 2018

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Bond Finance Update
December 18, 2018
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CDFA Bond Finance Update


2019 Bond Market Outlook: Peak Expectations
After more than two years of steadily rising interest rates, 2019 could mark the peak in U.S. Treasury yields for the current business cycle. However, while the prospect of more stable or lower interest rates may be positive for bond investors, the road ahead is likely to be bumpy.

Butler County, OH Bond Rating Upgrade Carries Big Benefits
The Port Authority is currently just a "conduit" to bring in developments — they don't issue loans to help businesses come here on their own — the rating upgrade won't effect them at the moment. But they are talking about establishing a RLF and the bond rating would come into play at that point.

O'Hare Deal Launches Massive Terminal Rebuild
Chicago will kick off its $8.5 billion, airline-approved terminal makeover of O'Hare International Airport with a $1.85 billion bond issue in early December with plans to return in the coming years with billions more. The issue marks the city's first use of an initial $4 billion of borrowing approved by the City Council earlier this year.

Fighting Fires with "Forest Resilience" Bonds
The startup, Blue Forest Conservation, launched by University of California, Berkeley business school graduates and backed by the World Resources Institute, works to raise money to save the forest through a public-private partnership. To do so, it created the first "Forest Resilience Bond."

Muni Industry to Wait for 2019 to Lobby on Tax Bill
Muni market advocates won't try to pursue their goal as part of a package of tax extenders and technical corrections under consideration during the current lame duck session. The three-week session of Congress that convened this week may include passage of a tax bill released by Rep. Kevin Brady.

Green Bonds Benefit Companies, Investors and the Planet
The past five years have seen explosive growth in "corporate green bonds" issued to finance climate-friendly projects. While investors bought just $3 billion of these bonds in 2013, they scooped up $49 billion worth in 2017, bringing the total sold since 2013 to $113 billion at an average of $308 million per offering.

WHEFA Provides $12.5M to Finance Student Housing in Eau Claire, WI
Bond financing facilitated by WHEFA was used to help Blugold Real Estate Foundation, Inc. (Blugold) permanently finance costs associated with the acquisition, construction and equipping of Aspenson Mogensen Hall, an off-campus coed student residence facility located in Eau Claire, Wisconsin.

Kravis Center to Issue $21M Bond for Expansion in West Palm Beach, FL
The Kravis Center for the Performing Arts in downtown West Palm Beach will sell $21 million in bonds to ensure that its ongoing expansion can be complete by January 2020, said CEO Judy Mitchell.

Market Reports

Weekly Capital Markets Update
Wye River | Dec. 18 | Bond Finance | Bond Finance\Market Reports

Weekly Market Outlook
Moody's Analytics | Dec. 18 | Bond Finance | Bond Finance\Market Reports

Weekly Rate Update
KPM Financial | Dec. 18 | Bond Finance | Bond Finance\Market Reports

Upcoming Events
Fundamentals of Economic Development Finance WebCourse

CDFA - PFM Capital Markets Webinar Series - Effects of the Tax Cuts and Jobs Act One Year Later
January 10, 2019 - 2:00 - 3:30 PM Eastern
The Tax Cuts and Jobs Act of 2017 was enacted one year ago this month, and we'll spend some time looking back what we've learned in that time. Our panel will explore the preservation of Private Activity Bonds, changes in the corporate tax rate and its effects, evaluate volume and the types of bonds most often used, and consider the effects of the elimination of advance refundings. We'll discuss options that issuers have for more flexible redemption options and strategies that have emerged to work around the absence of refundings. This webinar will feature the pros and cons and the questions that still remain twelve months into the new tax law.

News from The Bond Buyer

The latest municipal finance headlines from The Bond Buyer.

US DOT Announces $1.5B in BUILD Grants
The US DOT has announced $1.5 billion in BUILD grants to support 91 road, rail, transit and port infrastructure projects in 49 states and the District of Columbia. BUILD was previously known as Transportation Investment Generating Economic Recovery, or TIGER, established in 2009.

Detroit, MI Standalone Deal Will Test Appetite for Credit
Detroit is planning to end the year with two deals that will offer up to $243 million of bonds and test the market's perception of its recovery from its Chapter 9 bankruptcy. The city plans to price $112 million of new money unlimited tax general obligation bonds the week of Dec. 3 in its first standalone borrowing since the 2013 bankruptcy.

How IRS Ruling Will Impact Airport Projects
Airport authorities will have an easier time signing leases at their bond-financed terminals for prohibited uses under a new Internal Revenue Service private letter ruling. The ruling allows floating private equity to be used for a prohibited use for a tax-exempt bond-financed airport terminal renovation.

CDFA is proud to partner with The Bond Buyer as our Official Media Sponsor. Read more about this partnership and all of its benefits here.

Bond Finance Headlines

$125M Minneapolis, MN Mixed-Use Project Clears Financing Hurdle
Finance & Commerce | Dec. 10 | Bond Finance

$4.75M WHEFA Bond Financing Helps Fox Valley Lutheran High School Federation
WHEFA | Dec. 3 | Bond Finance | Community Development

Moody's Leaves Riverhead, NY Credit Rating Unchanged for New Bond Issuance
Riverhead Local | Nov. 29 | Bond Finance

Front Royal, VA Supports Bond for Apartment Renovations
The Northern Virginia Daily | Nov. 29 | Bond Finance

Development Authority Approves $42.5M Bond in Bartow County, GA
The Daily Tribune News | Nov. 29 | Bond Finance

Blair Airport Authority Approves $1.26M Bond in Blair, NE
Pilot-Tribune & Enterprise | Nov. 29 | Bond Finance

What Bond Gurus Are Saying About the Market Sell-Off
Bloomberg | Nov. 29 | Bond Finance

Fairfield, PA Area School Board Moves Forward with $10.3M Bond
Gettysburg Times | Nov. 29 | Bond Finance

Sumner County, TN Commission Approves $100M New School Plan
Tennessean | Nov. 20 | Bond Finance | Infrastructure Finance | Rural Development | Tax Increment Finance (TIF)

The Council of Development Finance Agencies is a national association dedicated to the advancement of development finance concerns and interests. CDFA is comprised of the nation's leading and most knowledgeable members of the development finance community representing public, private, and non-profit entities alike. For more information visit CDFA.net or email info@cdfa.net

For more information about sponsoring one of CDFA's electronic newsletters, please contact CDFA or call 614-705-1300.

Council of Development Finance Agencies
100 E. Broad Street, Suite 1200
Columbus, OH 43215
(614) 705-1300

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