Topic: finance
City of LA Votes Against Becoming Successor Agency to CRA/LA
cccccc
In a lengthy session this week, the City Council of the City of Los Angeles, CA voted against assuming the obligations of the Community Redevelopment Agency of Los Angeles (CRA/LA) to become the successor agency under the provisions of ABx1 26.
The passing of ABx1 26 and the subsequent fallout has put several projects into a precarious position, including 10 projects in Los Angeles County show in the graphic on the left.
An article about the Council’s decision can be found in today’s Los Angeles Times. To hear the discussion about the Council’s decision and the next steps, watch the on-demand video of the meeting here.
Alabama’s Jefferson County Files Largest Municipal Bankruptcy in U.S. History
After reaching an impasse over concessions with holders of $3.14 billion in bonds, Commissioners in Jefferson County, Alabama, voted 4-1 to file the largest municipal bankruptcy action in U.S. history.
According to Bloomberg, JPMorgan Chase & Co., which arranged most of the outstanding debt to fund a sewer renovation, will likely take the largest loss.
A provisional agreement with creditors approved by Commissioners in September 2011, included $1.1 billion in concessions and called for sewer rate increases of as much as 8.2% over three years. The agreement was abandoned when the county was unable to obtain commitments from creditors.
The vote by officials in Alabama’s most populous county occurred nearly a month after Pennsylvania’s capital of Harrisburg sought court protection citing millions in overdue bond payments tied to a trash-to-energy incinerator. The Jefferson bankruptcy filing dwarfs California’s Orange County bankruptcy in 1994. Market observers fear that the action might reignite investor concerns regarding defaults in the $2.9 trillion U.S. municipal bond market.
$7 Billion in Stimulus Funds Reimbursed by DOT in 2011
The transportation portion of the American Recovery and Reinvestment Act has paid out more than $7 billion in the first nine months of 2011 to reimburse states for completed projects, according to Recovery.gov, the White House’s official site. Most of the Department of Transportation (DOT) money was cycled through the Federal Highway Administration, which was involved in approximately 13,000 projects. During the peak construction season, May through September, DOT paid out nearly $3.2 billion.
Weekly Quick Hits
Chevy Invests In Renewables – Learn about Chevrolet’s renewable energy initiative to reduce carbon emissions by 8 million metric tons.
Tennessee Solar Farm Approved – The U.S. Department of Energy has approved construction of a solar energy farm in Haywood County, Tennessee. (Bloomberg)
Obama Speaks to US Chamber of Commerce – President Obama will seek common ground with the business community during a speech to the U.S. Chamber of Commerce today. (The Wall Street Journal)
Governors Around the U.S. to Cut Budgets – In a largely bipartisan move, many governors around the United States plan to initiate spending cuts, without raising taxes, in order to balance their state budgets. (The Wall Street Journal)
ON THE CALENDAR: Renewable Energy 101, Sept. 21-22
Alexandria, VA - Renewable Energy 101: Tapping into New Sources of Energy and Money for Housing and Community Development will explore the differences among the various energy sources and provide practical solutions to help you tap into the best renewable energy source for your housing or community development project.
Panel Highlights
- The Best Energy Source for Your Project
- A How-To Guide for Financing Your Project
- The Basics of Tax Credits and Grants
- Overview of Financing Sources
- Policy Updates
The conference will feature case studies of successful projects throughout the country, showing how various renewable energy sources and financing structures can be utilized, including:
- Combining Grants
- Multiple Tax Credits
- Multiple Debt Sources
Who Should Attend?
Developers and Owners of Housing and Community Development Projects looking to secure financing for renewable energy initiatives, to gain advantage in funding competitions by utilizing green technologies and to lower energy costs for their properties
Financial Institutions, Investors and Lenders that use energy tax credits or other methods of financing to invest in or lend against renewable energy facilities or that want to learn about the current state of the renewable energy finance industry, as well as those that see the great opportunity and potential of alternative energy sources
Government Agencies and Municipalities looking for practical and cost-effective ways to encourage and utilize renewable energy, as well as those looking to understand which pieces of the financial puzzle can be met by the private sector and which pieces require governmental encouragement
Energy and Tax Accountants, Lawyers, Environmental Consultants and other Professional Advisers who need to know the current trends in renewable energy project finance and community development or want to enhance their practice in the renewable energy industry
Biomass, Geothermal, Solar, Wind and Other Renewable Energy Developers who want to understand the financial aspects of renewable energy development and take advantage of other community development tools
Building Owners looking to lower operating expenses or to protect themselves against increasing electricity costs by using renewable energy
Farmers and Other Rural Land Owners seeking ways to participate in renewable energy facility development and help develop their communities
Companies, from Start-Ups to Blue Chips, that invest in every part of the renewable energy spectrum, including investors; solar panel, wind turbine and other component manufacturers; “green employment agencies;” and other renewable energy service providers
Nonprofits and Educational Institutions that need advice as they play a role in renewable energy projects as hosts of renewable energy installations and as advocates for renewable energy
Attendees of the conference are eligible for GBCI CE, CLE, CPE CE and HRCI credits.
For more information about the conference and to register, click here.
ON THE CALENDAR: Mergers & Acquisitions in the Renewable Energy Industry, July 19-20
Boston, MA - Mergers and acquisitions (M&A) in the renewable energy industry are expected to increase throughout the next year and into the future. However, the numerous federal, state, and local programs designed to spur renewable energy growth coupled with the recent financial crisis makes the M&A environment turbulent and at times contradictory. Although most experts agree that renewable energy development remains a profitable industry, financers’ current appetite for risk remains extremely low despite the slight economic upswing making M&A transactions difficult.
This conference will discuss the current status of M&A in the renewable industry and describe where it is heading on both a national and international level. As financing transactions remains extremely difficult, the conference will suggest innovative new financing mechanisms and provide lessons learned from recent transactions. It will review the basics of due diligence and provide an in-depth review of due diligence in a cross border transaction. This conference is designed to set the stage for where M&A is now and provide suggestions regarding where it will be headed to help those in the industry adequately prepare for what is to come.
Goodwin Procter partner, Elise Zoli will co-present the “Lessons Learned From Recent Transactions” session along side Bryan Fennell, NextEra Energy Resources and Tim Huckaby, FMI Capital Advisors. As companies attempt to navigate the M&A environment, it is helpful to learn from what has been successful in the recent past. Zoli, Fennell and Huckaby will share their experience with negotiating and completing transactions in the renewable energy industry despite the financial crisis.
Mergers and Acquisitions in the Renewable Energy Industry is hosted by Electric Utility Consultants, Inc. (EUCI). Attendees are eligible for 0.9 continuing eduation credits.
View the agenda here.
Freddie and Fannie Take a Stand on PACE
Property Assessed Clean Energy (PACE) programs, which offer homeowners a method of paying for the installation of solar panels and other energy efficiency upgrades through municipal finance, have become extremely popular across the country. So popular, in fact, that the U.S. Department of Energy intends to contribute $150 million in stimulus funds to help continue and expand PACE programs and give an economic boost to companies that install energy systems.
Recently, however, Fannie Mae and Freddie Mac informed mortgage lenders that they would not subordinate their mortgages to the lien of an assessment for solar facilities. As many local and state officials have noted, the liens that secure PACE loans are no different than other types of special property taxes, like those used to finance sidewalks and underground utilities, which have previously been approved by Freddie and Fannie.
State and local officials, including California Governor Arnold Schwarzenegger, New York City Mayor Michael R. Bloomberg, and some members of Congress, are pressing the Federal Housing Finance Agency, which oversees Fannie and Freddie, for clarification of its position on the financing programs. Stay tuned.
PACE Program Helps California Homeowners Go Green
Bond lawyers and local governments have a new tool to aid in the fight against climate change. The Property Assessed Clean Energy (PACE) program permits local governments to help homeowners finance the installation of solar panels or other energy-saving improvements. Under the PACE program, local governments finance the improvements with municipal bonds, and property owners repay the debt through assessments levied on their property. The debt stays on the property in the event of sale or transfer. [Read More]
