Our public finance lawyers are nationally recognized bond counsel whose opinions are universally accepted. We have been involved in all facets of tax-exempt and municipal finance, including general obligation financing for state and local governments, traditional municipal and utility revenue bond financings, financings for colleges, universities, hospitals and other nonprofit institutions, transportation, pollution control, solid waste, housing and industrial revenue bond financings.
In addition to lawyers regularly practicing in public finance, our practice often involves significant experience beyond the state and local borrowing laws and the federal tax laws. Our bond lawyers often are assisted by lawyers on the firm’s corporate and finance, corporate restructuring, securities, real estate and tax teams with respect to matters involving federal and state securities laws, bankruptcy and creditors’ rights, real estate and collateral tax issues. We regularly represent banks and borrowers in connection with letter of credit secured financings, and our broad commercial and financial experience gives us the capability to address the most sophisticated financial structuring issues.
Nonprofit Organizations. Over the years, the largest part of the firm’s practice has included the issuance of tax-exempt bonds for nonprofit institutions, including institutions of higher education and hospitals and other health care providers. The firm has developed a national reputation in the area of tax-exempt financing for colleges and universities, having been involved in financings over the years for most of the major educational institutions in Pennsylvania, as well as other major universities around the country. Our practice also includes a growing number of financings for private independent secondary and elementary schools. In addition, we have been involved in some creative financings for other charitable service organizations and cultural institutions.
For example, we assisted our regular client, The American National Red Cross in developing and structuring an efficient private-placement program to provide tax-exempt financing for its local chapters and blood services facilities around the nation. Our ability to provide the highest level of service in this area is enhanced by our broad experience generally in the representation of nonprofit corporations, including substantial tax experience in issues relating to exempt organizations.
Health Care. A major part of the firm’s public finance practice consists of the issuance of tax-exempt bonds for hospitals and other health care providers. Our involvement has included serving as bond counsel, underwriters’ counsel or institution counsel in financings for major teaching and research hospitals, in addition to other major health systems and many acute-care community hospitals. The fastest growing area of the firm’s health care financing practice relates to the issuance of tax-exempt bonds to finance sub-acute care facilities, including nursing homes, assisted-living and continuing care facilities and retirement and life-care communities.
The firm has one of the nation’s largest and most pre-eminent health law practices, which contributes to our ability to provide creative and efficient counsel to our health-related public finance clients. This often includes counseling with respect to tax, regulatory and reimbursement issues for hospitals and nonprofit health care providers, both generally and as those issues relate to capital financing.
Other Facilities. Our bond lawyers are experienced in many other aspects of the public finance market, including, for example, the financing of public electricity utilities (including the country’s largest public power agency), solid waste facilities, small-issue manufacturing facilities, low-income residential rental housing projects, private server programs and statewide student loan programs.
Tax. The federal government has sought to curtail the issuance of tax-exempt bonds through changes in its tax laws. Virtually every year has brought significant changes to the laws and regulations governing the federal income tax exemption of governmental bonds. These have included restrictions in the types of projects that can be financed with tax-exempt bonds, limitations on the amount of private participation in financed projects, restrictions on the forms of bonds, information reporting, and continually updated rules to govern the investment of proceeds of tax-exempt bonds and the rebate of excess earnings to the federal government.
Lawyers on Drinker Biddle’s public finance and tax teams keep abreast daily of developments in federal tax laws governing public bonds. Our tax lawyers also have significant experience in other tax matters of relevance to financing structures, including partnership tax issues, unrelated business taxable income issues and New Markets Tax Credits.
The constant development of new products in the municipal market has increased the level of sophistication required to serve as bond counsel. The firm has experience with many of the products currently being used in the tax-exempt market, including interest rate swaps, caps, floors and collars, inverse floating rate securities and other derivative products.
Securities Law. Increasingly, the municipal market has become sensitive to securities regulatory issues. The Securities and Exchange Commission continues to express concern as to the quality and frequency of market disclosure in the tax-exempt market (both for new issues and in the secondary market). Moreover, the expanding range of products (including derivatives) in the market has increased the complexity of compliance with federal and state securities laws. The firm’s long history of practice under federal securities laws (the firm filed the second registration statement with the SEC under the Securities Act of 1933) provides its bond lawyers with the experience and resources clients need in addressing their most difficult regulatory and disclosure issues.
Derivatives and Other Financial Products. Our public finance lawyers, enhanced by the firm’s general corporate, securities and finance practices, regularly review interest rate swap, hedge and other similar agreements, as well as structured investment products often used in bond financing transactions.