New Money and Refunding Financings

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Kutak Rock’s municipal finance tax attorneys are instrumental to our nationally recognized public finance practice. Our tax attorneys, based in offices around the nation, work with each other and with our transactional attorneys in structuring and documenting all types of tax-exempt financings. Our firm’s tax lawyers consistently engage with and advise issuers, investment bankers, financial advisors, credit providers, the Internal Revenue Service and the Department of the Treasury.

Our transactional and tax attorneys work together to advise issuers and borrowers on the permissible expenditures of “new money” proceeds, investment yield restrictions and other applicable tax issues in various categories of tax-exempt financings, including the following:

  • governmental facilities
  • single-family housing
  • multifamily housing
  • qualified 501(c)(3) facilities
  • student loans
  • health care facilities
  • small manufacturing facilities
  • pollution control facilities
  • solid waste facilities
  • airports
  • port facilities

Tax-exempt debt also can refinance prior debt issued for qualified expenditures. In these refunding transactions, proceeds of refunding bonds are typically deposited in escrow and invested in U.S. Treasury Securities maturing at times and in amounts sufficient to pay principal and interest on the prior bonds through the first call date or maturity. Our tax lawyers have extensive experience and expertise in working with the other transactional players to structure refundings to achieve the desired cost savings and restructuring of debt service, consistent with the arbitrage restrictions on refunding escrows and other applicable tax rules.