Public Charter Schools Borrowing With Tax-Exempt Bonds, Second ...

chapter eleven
Steps to Issuing Bonds and the Finance Team
A. Steps
While there are lots of variations depending on the type of Issuer, the type of
Project, applicable state law, policies and procedures of the Issuer and other factors,
the following is illustrative of the basic steps in a typical tax-exempt bond issue for
a public charter school:
1. Engage the Underwriter. The Underwriter is an investment banking firm,
selected by the charter school, that is responsible for marketing the bonds—
to help structure the financing, to organize the charter school’s financial
information for inclusion in the Official Statement and for presentation to
the rating agencies to obtain ratings on the bonds and/or to credit providers,
and to purchase (i.e., underwriting) the bonds for resale to investors. The
Underwriter’s counsel is primarily responsible for preparing the Bond Purchase
Agreement and may prepare the Official Statement. Consulting an Underwriter
with experience in structuring and marketing tax-exempt bonds for public
charter schools early in the process is crucial to determining whether there
is a market for the school’s bonds, at what expected rating and interest rates,
and working out the basic structure of the financing with Bond Counsel.
2. Consult Bond Counsel. Bond Counsel is the law firm primarily responsible
for rendering an opinion on the validity and tax exemption of the bonds
and for drafting the legal documents to be executed by the public charter
school and the Issuer in connection with the bond issue and may prepare
the Official Statement. While Bond Counsel typically represents the
Issuer, and the school is represented by its own counsel, Bond Counsel’s fees
Public Charter Schools Borrowing With Tax-Exempt Bonds, Second Edition 49