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Public Finance Services for the Education Industry

Financing Capital Needs With Tax-Exempt Debt

Colleges, universities, and K-12 schools are enhancing their campuses by developing state-of-the art buildings, upgrading their infrastructure, and incorporating modern amenities. These improvements will entice students, attract faculty and research funding, prepare students for the job market, and engage local communities. Since these construction and renovation projects are a large capital outlay many nonprofit education institutions utilize tax-exempt bonds to achieve their financing needs.

Saul Ewing Arnstein & Lehr’s Public Finance attorneys regularly serve as bond counsel and borrower’s counsel in connection with the issuance of tax-exempt debt for colleges, universities and K-12 schools, including in the following areas:

  • Structuring capital campaign literature to ensure that donor gifts are not limited to certain projects and permit the issuance of tax-exempt debt in conjunction with the capital campaigns
  • Advising on the legal aspects of various financing alternatives—from fixed-rate and variable-rate transactions to swaps, public private partnerships (P3s) and floating rate notes (FRNs)
  • Structuring, negotiating, documenting and conducting due diligence for financing transactions
  • Advising on tax regulations relating to tax-exempt bonds and the investment of proceeds, including general arbitrage and arbitrage rebate matters
  • Advising on so-called “story bonds” for first-time issuers
  • Counseling on private inurement to help education institutions’ board members avoid conflicts of interest related to the schools’ public bonds
  • Reviewing Form 990s specific to nonprofits
  • Advising on ongoing post-issuance tax compliance and SEC continuing disclosure to help ensure that a project remains tax-exempt for the life of the debt (often 30+ years)
  • Representing clients with IRS audits of tax-exempt bonds
  • Revising policies as laws change or as clients may request

Our Approach

With decades of public finance experience and one of the country’s leading K-12 and Higher Education Practices, our attorneys:

  • Serve as knowledgeable advocates for our clients, helping them negotiate deals with favorable terms
  • Conduct upfront due diligence that helps us pinpoint critical areas, ask our clients targeted questions pertaining to those areas, and translate the implications for our clients in order to make key revisions. We have keen knowledge of what is and what is not “standard” in the market.
  • Spot tax issues early in the process since our bond attorneys are tax-trained, e.g., determining troublesome areas that may be construed by regulators as the use of proceeds by private parties

 

Recognition

The group includes attorneys who have received the following recognition:

Trade Groups & Associations

Contacts

George T. Magnatta
Joshua S. Pasker