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Public Financing Opportunities
September 10th, 2004
The Development Planning & Financing Group LLC (“DPFG”) may provide professional services to developers and home builders with development projects located within the following states: Arizona, California, Colorado, Florida, Hawaii, Nevada, New Mexico, Texas and Utah.
The descriptions of public financing vehicles shown below is not intended to be all inclusive however, we have attempted to enumerated the most prevalent public financing vehicles which are available to developers in that particular state. It should be noted that when we are assisting in the preparation of a financing strategy for a client, we investigate the use of all public financing vehicles which are available and practical. It should be noted that all of the public financing vehicles shown below allow the developer to pass on the debt service obligation of the tax exempt bonds to the end users of the property.
Improvement Districts(“ID”): An ID is formed by the incorporated city/town and or a county in which the development project located. IDs may issue tax exempt special assessment bonds typically with a maturity not to exceed 20 years for the construction of the following public improvements:
Water projects
Sewer projects
Roadway projects
Bridges/underpasses/overpass projects
Off street parking projects
Curb and gutter projects
Street light projects
Traffic signalization projects
Storm drainage projects
Community Facilities Districts (“CFD”): A CFD may be established in an incorporated city or town and may issue tax exempt special assessment, general obligation and/or revenue bonds to fund the construction of public improvements. CFD bonds typically have a terms of not to exceed 25 years. CFD bonds my fund the acquisition and/or construction of the following public improvements:
Water projects
Sewer projects
Roadway projects
Street light projects
Traffic signalization projects
Parks and recreational projects
Public building projects
Parking structure projects
Landscaping and lakes projects
School facility projects
Pedestrian mall projects
Enhanced public services
For further details see the AZ CFD Opportunities section of our web site.
Mello-Roos Districts: The Mello-Roos Community Facilities District Act of 1982 provides a mechanism by which certain public entities, such as cities, counties, special districts, school districts, joint powers entities and redevelopment agencies, may finance the construction and/or acquisition of facilities and provision of certain services. Examples of public facilities that may be financed include:
Local park and recreation, open-space facilities
Elementary and secondary schools and sites
Libraries
Child care facilities
Facilities to transmit and distribute water, natural gas, telephone, electrical energy, cable television
Flood and storm protection facilities
Roadways
Landscaping
Sewer Facilities
Fire and police facilities
Remediation of hazardous materials
Tax exempt bonds are issued and secured by a special tax levy encompassing the property benefited by the improvements. The bonds may not have a maturity of longer than 40 years.
Redevelopment Districts: A redevelopment districted is created by a city or a county and may issue bonds for any of the corporate purposes of the redevelopment agency which include:
Acquisition of real property
Development of real property
Construction or reconstruction of streets, highways and sidewalks
Installation of public utilities
A developer may elect to receive a portion of the annual property tax increment generated by the development located within the boundaries of a redevelopment area to reimburse the developer for the cost of eligible public improvements. Alternatively, the developer may elect to issue tax allocation bonds which are secured by the annual property tax increment anticipated to be generated over the life of the redevelopment district.
Metropolitan District (“MD”): The MD is the most prevalent and developer friendly public financing vehicle available for use in Colorado. A MD is a separate political subdivision initial formed and operated by a developer within a city/town or county for the purpose of issuing tax exempt bonds to fund the construction and/or acquisition of public improvements. Public improvements eligible for financing include:
Water projects
Sewer projects
Roadway projects
Landscaping projects
Parks and recreational projects
Street Light projects
Traffic signalization projects
Storm drainage projects
A MD may issue general obligation and revenue bonds which do not exceed 40 years in maturity.
Community Development Districts (“CDD”) : A CDD is created by the county in which the development project is located and may issue tax exempt special assessment, general obligation and/or revenue bonds to finance the construction and/or acquisition of the following public infrastructure projects:
Engineering, surveying, stalking
Roadways
Water
Wastewater
Storm drainage
Bridges
Parking improvements
Environmental remediation costs
Parks and related facilities
Fire prevention and control
School buildings and related structures
Waste collection and disposal
Street lighting and Signage
CDD bonds may have a maturity which is greater than 40 years.
Community Facilities Districts (“CFD”): A CFD may be established in a county and may levy a special tax to issue bonds to fund the acquisition and/or construction of public improvements. CFD bonds typically have a terms of not to exceed 40 years. CFD bonds my fund the acquisition and/or construction of the following public improvements:
Water projects
Sewer projects
Roadway projects
Street light projects
Traffic signalization projects
Parks and recreational projects
Public building projects
Parking structure projects
Landscaping projects
School facility projects
Gas / Electrical / Cable / Telephone
Special Improvement Districts (“SIDS”): SIDs are the most common tax exempt bond financing utilized within the state of Nevada to finance the construction of public infrastructure. SIDs may be formed by any incorporated city or town or by the county in which the development project is located. A developer may finance the acquisition, construction, operation and/or repair of the following public improvements through the use of SID:
Commercial area vitalization project
Curb and gutter project
Drainage project
Offstreet parking project
Overpass project
Park project
Sanitary sewer project
Sidewalk project
Storm sewer project
Street project
Street beautification project
Transportation project
Underpass project
Water project
Electrical project
Telephone project
A SID may issue tax exempt special assessment bonds that do not have maturity in excess of 20 years.
Public Improvement District (“PID”): A PID may be established in a municipality or county and may issue general obligaton, special tax levy and/or revenue bonds to fund the acquisition and/or construction of public improvements. PID bonds typically have a terms of not to exceed 30 years. PID bonds my fund the acquisition and/or construction of the following public improvements:
Water projects
Sewer projects
Roadway projects
Street light projects
Traffic signalization projects
Parks and recreational projects
Public building projects
Parking structure projects
Landscaping projects
School facility projects
Gas / Electrical / Cable / Telephone
- Equipment
- Construction Management Fees
Improvement Districts(“ID”): An ID is formed by the incorporated city/town and or a county in which the development project located. IDs may issue tax exempt special assessment bonds typically with a maturity not to exceed 40 years for acquisition and/or construction of the following public improvements:
Water projects
Sewer projects
Roadway projects
Bridges/underpasses/overpass projects
Off street parking projects
Curb and gutter projects
Street light projects
Traffic signalization projects
Storm drainage projects
Municipal Utility Districts (“MUD”): A MUD may be formed in an incorporated city/town or in the county in which the project is located for the purpose of acquiring, constructing and/or repairing the following public improvements:
Water projects
Sewer projects
Solid waste disposal projects
Storm drainage projects
Parks and recreational projects
A MUD may issue general obligation and/or revenue bonds with a maturity of no longer than 40 years for the purpose of financing the acquisition, construction, repair and/or operation of the aforementioned projects.
Improvement Districts(“ID”): An ID is formed by the incorporated city/town or county in which the development project located. An ID may issue tax exempt special assessment bonds with a maturity not to exceed 20 years for acquisition and/or construction of the following public improvements:
Water projects
Sewer projects
Roadway projects
Landscaping projects
Street lighting
Electrical projects
Parking facilities
Improvements related to research and/or industrial parks
Curb and gutter projects
Street lights and Signage
Storm drainage projects
Special Service Districts (“SSD”): SSDs may be formed by a city/town, county or an improvement district for the purposes of supplying:
Water
Sewage
Drainage
Flood control
Garbage
Health care
Transportation
Recreation
Fire protection
Street lighting
911 dispatch
Snow removal
A SSD may construct and/or acquire the aforementioned public projects via the use of tax exempt general obligation bonds and/or revenue bonds. It should be noted that a development may contain both an improvement district and a SSD and thus have the ability to issue both tax exempt special assessment bonds, general obligation bonds and revenue bonds.
