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CDFA Bond Finance Update - July 21, 2020

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Bond Finance Update
July 21, 2020
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CDFA Bond Finance Update


CDFA Receives Grant from Robert Wood Johnson Foundation to Unlock Lending for Communities of Color
The Council of Development Finance Agencies is excited to announce a new initiative exploring the market demand and feasibility of a national loan guarantee program with a focus on serving communities of color affected by COVID-19. The study is made possible by a $145,000 grant from the Robert Wood Johnson Foundation.

Check Out the Intro Bond and Advance Bond Finance Courses at CDFA Summer School!
Learn everything you need to know about bond financing at the Intro Bond Finance Course and the Advanced Bond Finance Course. These courses are part of CDFA Summer School, where you can learn from our expert practitioners and experience CDFA's most interactive educational event of the year - all from the comfort of your own home or office!

Congress Considers Additional Support for Tax-Exempt Issuers and State and Local Infrastructure Projects
Two bills from the House of Representatives (H.R.2, the Moving Forward Act, and H.R.3967, the Municipal Bond Market Support Act) and two from the Senate (S.4203, the American Infrastructure Bonds Act, and S.4129, the Lifting Our Communities through Advance Liquidity ("LOCAL") for Infrastructure Act) could have significant effects on state and local government bond issuers and developers of infrastructure if enacted.

San Diego, CA Council Asks Voters to Decide on $900M Housing Bond
A $900 million housing bond measure that has been years in the making is finally going to be placed on the ballot this November in San Diego. The measure would fund construction of around 7,500 new affordable-housing units and be paid for with a property-tax increase, according to the report.

Massachusetts Senate Passes $1.7B Bond Bill
Massachusetts Senate passes a $1.7 billion General Government Bond Bill focused to improve government infrastructure, empower communities disproportionately impacted by the criminal justice system, expand equitable access to remote learning opportunities for vulnerable populations across the commonwealth and address growing food insecurity, and food supply chain needs across the commonwealth.

Senators Wicker, Bennet Introduce American Infrastructure Bonds Act
The American Infrastructure Bonds Act of 2020 would create a new class of "direct-pay" taxable municipal bonds to help struggling governments finance critical public projects in the wake of the coronavirus pandemic. The senators' proposed bonds would improve upon the model of Build America Bonds that were issued after the 2008 financial crisis to attract more investment in public infrastructure.

Clark County, NV School District to Issue $400M in Bonds for New Buildings, to Fix Aging Schools
The Clark County School District has been approved to issue $400M more in facilities bonds to help fund new buildings as well as address the maintenance needs of its aging schools. Approximately $1.7 B in bond revenue has been generated since, according to a district presentation, but with $1.3B and another $280M under contract, the remaining revenue proceeds are around $85M.

‘Social Bonds' Are Surging as Conscious Investing Turns Mainstream
New research shows the issuance of social bonds has reached record levels and more than quadrupled so far this year, as conscious investors combine profit and purpose to address rising inequalities created by the coronavirus. Recent growth in social bond issuance indicates that the COVID-19 pandemic has not turned issuers' or investors' attention away from sustainable finance — rather, interest seems to be growing.

House Infrastructure Bill Would Bring Back Muni Debt Refinancing
New language in an infrastructure bill introduced by House Democrats would undo limitations on advance refunding bonds put in place by the 2017 tax law in addition to offering other tax incentives aimed at financing building and rehabilitation projects.

City of Jacksonville, FL Contributes to $484M Project to Deepen Harbor
The City of Jacksonville is preparing to provide up to $120 million for Jaxport's project to deepen up to 13 miles of the St. Johns River, adding to the existing public and private contributions on the project. The effort to deepen the harbor began in 2018 and is expected to finish in 2023, 2 years ahead of schedule.

Market Reports

Weekly Market Outlook
Moody's Analytics | Jul. 16 | Bond Finance | Market Reports

Capital Markets Newsletter
Wye River Group | Jun. 16 | Bond Finance | Market Reports

Upcoming Events
CDFA Virtual Summer School

CDFA Food Systems Finance Webinar Series: Neighborhood Revitalization Through Food Systems Finance
Thursday, July 30, 2020 - 2:00 PM Eastern
This installment of the CDFA Food Systems Finance Webinar Series will illustrate the many positive impacts that result from financing food systems at a neighborhood scale, with speakers to showcase the versatility of projects and financing approaches.

CDFA-PFM Capital Markets Webinar Series: Today's Bond Regulatory Environment
August 20, 2020 - 2:00 - 3:30 PM Eastern
During this installment of the CDFA-PFM Capital Markets Webinar Series, experts will analyze how recent regulatory actions will impact how banks buy bonds and how deals are priced.

News from The Bond Buyer

The latest municipal finance headlines from The Bond Buyer.

Libor Showed its Weakness in Coronavirus Market Crisis
The deadline for the phase-out of Libor at the end of 2021 will not be delayed and despite the effects of the COVID-19 pandemic, progress is being made on the switch to alternative reference rates. That was the message of New York Federal Reserve officials in two webcast presentations Monday and Wednesday.

Florida Wants to Use Municipal Bonds to Boost Private Space Firms
Florida is ready to use the municipal bond market to achieve its goal of boosting the private space-launch industry. Gov. Ron DeSantis signed legislation in late June enabling Space Florida, the state's aerospace economic development agency, to bypass approval from the governor and cabinet to issue revenue bonds for private companies pursuing capital projects.

Four Months In, Still Lots of Questions About the Coronavirus' Impact on the Economy
From the beginning, much uncertainty surrounded the coronavirus pandemic. But almost four months after stay-at-home orders started, economists agree on little about the shape of the recovery, the timing, and where things stand right now.

SEC, MSRB Provide Guidance on Muni Advisor Exemptive Order
The Securities and Exchange Commission's temporary exemption to allow municipal advisors to arrange certain private placement deals is indeed narrow and conditions included in the order will discourage retail access to the market, regulators say.

House Infrastructure Bill Set to Pass, Partisan Challenge Ahead in Senate
The House is poised to pass along party lines a major infrastructure package which includes a new series of taxable direct-pay bonds and a restoration of tax-exempt advance refunding, though the partisanship of that process may make it difficult to forge an infrastructure bill in the Senate.

Las Vegas Train Builder Gets More Time to Sell Private Activity Bonds
The California Infrastructure and Economic Bank approved a five-month extension for plans to price $3.25 billion in private activity bonds for a high-speed train to Las Vegas.

Expanded Use of PABs Included in House Infrastructure Bill
A bipartisan bill included in House Democrats' larger infrastructure package would expand the use of tax-exempt private activity bonds to finance small to mid-sized manufacturing and agricultural sectors. The Modernizing Agricultural and Manufacturing Bonds Act would change certain definitions to try to expand the use of small issue manufacturing bonds, known as industrial development bonds, and first-time farmer bonds, often referred to as aggie bonds.

Conservatives Balk at More Federal Aid for State, Local Governments
Conservatives are digging in with the argument that reopening the economy is a better approach to battling the economic impact of the pandemic than a new round of federal aid to state and local governments would be. But the National League of Cities and other groups such as Moody's Analytics are warning that a nationwide economic recovery will be at risk of stalling if Congress fails to provide more aid.

Qualified Infrastructure Bonds Are the New Build America Bonds
The new Qualified Infrastructure Bonds, which are modeled after Build America Bonds, would have their direct-pay subsidies phase lower to 38% in 2025, 34% in 2027, and 30% permanently thereafter. The legislation also would restore tax-exempt advance refunding 30 days following enactment into law and authorize the issuance of $30 billion in qualified school infrastructure bonds (QSIBs) over three years.

Fed Chairman Cites Importance of State, Local Government Aid
Federal Reserve Chairman Jerome Powell is telling Congress that federal aid to state and local governments deserves their attention. In video testimony with the Senate Banking Committee and with the House Financial Services Committee, Powell said that the 13% of the American workforce who are employed by state and local governments represent a significant part of the economy.

Short-End Muni Yields Inch Higher as a Variety of New Deals Hit the Market
The rally in municipal bonds slowed as yields rose modestly again on the short- and intermediate-ends of the curve Wednesday, as the long-end remained steady. The primary market is in full force now, though, as new deals are flooding the market.

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.

Legislative & Federal Affairs

CDFA is the national leader for development bond advocacy on Capitol Hill. A look at the latest discussions from Washington, DC:

CDFA Gets Bond Financing Provisions Included in House Infrastructure Bill
CDFA | Jun. 25 | Bond Finance | Disaster Recovery & Relief | Infrastructure Finance | Legislative | COVID-19

Visit CDFA's Legislative Affairs page for regular legislative updates, upcoming events, daily headlines, CDFA-led initiatives and more.

Bond Finance Headlines

Juneau, AK Proposes $15M Bond Package to Stimulate Economy
Juneau Empire | Jul. 20 | Bond Finance | Disaster Recovery & Relief | Economic Development | Infrastructure Finance | COVID-19

Georgia Power Operator Fires Up Inaugural U.S. Institutional Green Loan
Reuters | Jul. 9 | Bond Finance | Energy Finance | Green Finance | Infrastructure Finance | Resiliency | Social Finance | Green Bonds | Green Bonds

KeyBank Lines Up Freddie Mac Loan for Senior Housing
Connect Media | Jul. 8 | Bond Finance | Healthcare | Housing Finance | Member News | Social Finance

WHEFA Bond Financing Helps Health System Acquire, Refinance in Northern Wisconsin
WHEFA | Jul. 6 | Bond Finance | Healthcare | Member News

What's New in Energy Efficiency Finance?
U.S. Department of Energy | Jul. 2 | Access to Capital | Bond Finance | Energy Finance | Green Finance | Infrastructure Finance | Property Assessed Clean Energy (PACE) | U.S. Dept. of Energy (DOE) | Green Bonds | Understanding Energy Finance | Energy Efficiency Programs | Property Assessed Clean Energy Bonds (PACE) | Green Bonds

WHEFA Bond Financing Helps Aspirus, Inc. to Refinance in Portage, WI
WHEFA | Jul. 1 | Bond Finance | Healthcare | Member News

Invest in Infrastructure with Qualified Infrastructure Bonds
National Resources Defense Council | Jul. 1 | Bond Finance | Infrastructure Finance | Legislative

Largest Public-Private Partnership Social Infrastructure Project In U.S. History Completed At UC Merced
The Press | Jun. 30 | Bond Finance | Education | Public-Private Partnership (P3) Financing | Social Finance | Case Studies

Major LIHTC Boosts, Permanency for NMTC, Increase in HTC Percentage and Delay of ITC Phasedown in House Infrastructure Legislation
Novogradac | Jun. 23 | Access to Capital | Bond Finance | Disaster Recovery & Relief | Economic Development | Energy Finance | Green Finance | Infrastructure Finance | Legislative | Tax Credits | COVID-19

Inaugural Green Bond Designation Completed by California-based PACE Funding Group
PR Newswire | Jun. 23 | Bond Finance | Energy Finance | Green Finance | Property Assessed Clean Energy (PACE) | Resiliency | Green Bonds | Property Assessed Clean Energy Bonds (PACE) | Green Bonds | Programs

New 5-Story Waterfront Residential Complex Coming to Bay City
NBC 25 News | Jun. 23 | Bond Finance | Brownfield Financing | Tax Increment Finance (TIF)

House Democrats Release Text of H.R. 2; Major Infrastructure Bill Includes Bond Provisions
House Transportation and Infrastructure Committee | Jun. 22 | Access to Capital | Bond Finance | Disaster Recovery & Relief | Economic Development | Energy Finance | Housing Finance | Legislative | Resiliency | Tax Credits | COVID-19 | Legislative Front

Higher-Education Bonds in a COVID-19 World
Advisor Perspectives | Jun. 22 | Bond Finance | Disaster Recovery & Relief | Education | COVID-19

$148M Port Covington TIF Bond Sale Gets Thumbs-up From City Panel
Baltimore Business Journal | Jun. 17 | Bond Finance | Tax Increment Finance (TIF)

Coronavirus Effects: Credit Drivers and Rating Consequences
Moody's Analytics | Jun. 16 | Bond Finance | Disaster Recovery & Relief | Infrastructure Finance | COVID-19

Highlights from the Online Resource Database

CDFIs and the Capital Markets - Tapping into Impact Investors
Access to Capital | Bond Finance | Community Development | Social Finance
A new paradigm is emerging – one in which mainstream investors increasingly want to invest in the social, economic, and environmental well-being of communities. LISC's research paper, CDFIs and the Capital Markets: Tapping into Impact Investors, lays the foundation for the CDFI industry to seize on the opportunities stemming from this paradigm shift.

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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