DRAFT

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Restoration 2006 Community and Economic
Recovery After a Disaster Roundtable re Market
for Equity/Private Capital for Infrastructure
May 16 - 17, 2006
DRAFT
CONFIDENTIAL
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Presentation for Restoration 2006
1. Debt Markets are in Great Shape 2. Fixed
Income Investor Appetite in Gulf Opportunities
Zone 3. Gulf Opportunity Zone Act 4. Gulf
Opportunity Private Activity Bond
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in investment banking transactions except to the
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benefit investor clients.
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Debt Markets Are in Great Shape
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Restoration 2006
Debt Markets Are in Great Shape
1. Fixed rates are still relatively low 2.
Credit spreads are very low 3. Availability of
subordinate and high risk private debt 4.
Traditionally, the tax exempt market has been
more receptive to high leverage and lesser
ratings than has been the taxable market
____________________ Resumes included in Appendix
B.
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Market Overview
Municipal Market Update
____________________ Rates as of May 8, 2006
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Market Overview
Municipal Market Update
____________________ Rates as of May 8, 2006
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Fixed Income Investor Appetite in Gulf
Opportunity Zone
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Restoration 2006
Fixed Income Investor Appetite in Gulf
Opportunities Zone
1. Initial concerns overblown no red
lining. 2. Massive blanket downgrades by the
rating agencies. 3. Bifurcated bond market
north and south of I-10. 4. Little appetite for
new exposure from the bond insurers south of
I-10. 5. We were able to restructure the
superdome and provide the new capital at ground
zero.
____________________ Resumes included in Appendix
B.
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Gulf Opportunity Zone Act
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Restoration 2006
Gulf Opportunity Zone Act
1. Gulf Opportunity Zone encompasses 37 parishes
the Southern half of the State 2. At least
half of the relief has been targeted for the 22
Parishes on the coastal rim that sustained the
most damage 3. three provisions to assist in
infrastructure renewal a. Additional Advance
Refunding if no more than one escrow outstanding.
Helpful for restructuring but the one escrow
proviso limits its use. Was helpful in the
Superdome. b. Bonus depreciation may be of
limited use for infrastructure due to inherent
limitations (e.g. requires taxpaying entity not
government 501(c)3. Cannot be used with tax
exempt bonds. May work for certain deal (e.g.
toll road or rail system). c. GO Zone private
activity bonds
____________________ Resumes included in Appendix
B.
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Gulf Opportunity Zone Private Activity Bonds
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Restoration 2006
Gulf Opportunity Private Activity Bonds
1. Allows for tax exempt financing for most
qualified capital costs. 2. Louisiana
authorization of 7.8 Billion to be issued prior
to January 1, 2011. 3. State prefer projects
south of I-10 and wants to spread proceeds around
(i.e. max of 250mm) to any project. Focus on
job growth as evaluated by Louisiana Economic
Development Department. 4. No credit to the
State (generally) but a great way to get deal
done. 5. We expect many sub investment grade
projects, and we are ready of them, but we do
expect to be repaid. 6. We expect allocation to
go quickly. 7. Examples a. Housing b.
Hospitals/Healthcare c. Chemical
plants/factories d. Private schools e. Office
buildings f. More housing
____________________ Resumes included in Appendix
B.
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