Utility Revenue Bonds and Public Power Projects

One of the largest sectors of the public finance market consists of bonds issued for public utility systems, power projects, and private utility systems. The bond lawyers at Howell Linkous & Nettles have routinely provided bond counsel and underwriter’s counsel services for utility system financings across the South, and public utility finance comprises a large portion of the municipal finance practice for the firm. These systems include both municipally-operated and privately-operated water treatment facilities and distribution systems, wastewater treatment facilities and collection systems, electric distribution systems, and natural gas distribution systems. Our experience includes not only financing transactions for traditional utility systems, but also more unique transactions such as a landfill gas (methane) collection, treatment, and distribution system.

Not only do our bond lawyers have experience with traditional utility revenue bond issues sold in the bond market, but we also represent governmental clients who finance utility systems using federal or State programmes such as Rural Development (USDA) and State Revolving Fund Loans (EPA), as well as commercial bank loans.

Off-street parking facilities, including parking garages, parking lots, and even a system of parking garages, are regularly financed with municipal bonds. Although parking facility financings are most common for urban areas, they can also be essential for more rural settings that enjoy high volume visitor traffic, such as Native American Tribal facilities and other destination resorts. In addition, utility facilities are often funded with municipal bonds as economic development incentives for industrial, commercial, or residential real estate development. Financing techniques for these types of developments include tax increment financing (TIFs), special assessment financing (CDDs, MIDs, etc.), multi-county industrial parks, and special source revenue bonds (SSRBs). The bond lawyers at Howell Linkous & Nettles have hands-on experience with all of these development tools.

Our bond lawyers constantly work to develop techniques to meet the challenges of the rapidly developing, and often fickle, municipal finance marketplace. For example, our firm was instrumental in the development, along with a forward-thinking investment bank, of the standby purchase agreement to secure bond anticipation notes (BANs). This contract involves a standing obligation of an underwriting firm, for a period of years, to purchase the BANs or bonds of a municipality, providing the take out necessary for the annual sale and renewal of BANs pending the issuance of water and sewer revenue bonds to provide permanent financing of the utility project. This structural feature was noted by the rating agency as important in assigning its highest rating for the BANs.

We firmly believe that our determination to find financial solutions to the evolving challenges faced by local governments and developers sets us apart.