Public Infrastructure Bonds: An Issuer’s Cheat Sheet

Practical Guide

Bond Counsel Basics

What does Bond Counsel do?

Bond Counsel issues a legal opinion (a “bond opinion” or “final opinion”) confirming:

  1. Interest on the bonds is tax-exempt (if applicable), and
  2. The bonds are valid under state law

That opinion informs Bond Counsel’s analysis throughout the transaction.

Who is Bond Counsel’s client?

Bond Counsel’s client is the bond issuer. Bond Counsel also works closely with the issuer’s municipal advisor and capital providers to help bring financings to an efficient, successful close.

Issuer Takeaway: Closing a bond transaction takes a coordinated team—Bond Counsel helps keep the legal, tax, and authorization pieces aligned.

Your 4-Step Bond Gameplan

Step 1: Confirm the Issuing Agency

Confirm which governmental entity will issue the bonds.

This helps determine applicable legal requirements, including:

  • State law (and, if relevant, municipal code) requirements
  • Potential constitutional or statutory debt limit considerations
  • Whether the contemplated project scope is bond-financeable

Issuer Tip: Issuer identity determines the approval process, timeline, and allowable use of bond proceeds.

Step 2: Confirm Project Use + “Who Pays”

Confirm who will use the project and who will pay for the project (directly or indirectly). This helps determine applicable federal tax law requirements—most importantly, what can be financed on a tax-exempt basis versus taxable.

Issuer Tip: Project use and repayment sources often drive the tax analysis—flag these early, especially if assumptions change.

Step 3: Map the Approvals + Milestones

Build key public-process steps into the timeline early, including:

  • Reimbursement Resolution adoption (if reimbursing certain prior costs with bond proceeds)
  • Bond Resolution adoption

Issuer Tip: Meeting calendars, notice periods, and agenda deadlines often drive the critical path.

Step 4: Share Use of Proceeds with Bond Counsel Early

Tax-exempt bond rules can limit bond term based on the useful life of the assets being financed. Early clarity on project scope and expected expenditures helps confirm the most efficient structure.

Best Practice: Involve Bond Counsel once the issuer and preliminary project scope are known—even if financing terms are still developing.

Quick Reference: Key Terms

Core Approvals + Documents

Reimbursement Resolution
Issuer action adopted before (or in connection with) issuance to preserve the ability to reimburse certain prior project costs with bond proceeds.

Bond Resolution
Issuer action approving the financing and authorizing issuance of the bonds (and related documents).

Indenture
Agreement with the bond trustee defining bondholder protections and payment/administration terms. In some transactions, these provisions are contained in the Bond Resolution instead of a separate indenture.

Tax Certificate
Closing document in which the issuer certifies facts and covenants supporting the tax-exempt status of the bonds (including how proceeds will be used and invested).

Bond Purchase Agreement (or Bond Purchase Contract)Agreement between the issuer and the underwriter or purchaser that sets the pricing and key terms for the bond sale.

Official Statement
Disclosure document provided to investors in a public offering that describes the bonds, the project/financing, key risks, and other information relevant to the bonds.

Continuing Disclosure
Ongoing disclosure obligations (typically annual reports and event notices) required for many public offerings under federal securities law standards.

Financing Structure

Tax-Exempt Bonds
Bonds where interest is intended to be excluded from gross income for federal income tax purposes (subject to compliance with tax rules).

Taxable Bonds
Bonds where interest is taxable. Taxable proceeds are often used when tax-exempt rules would limit financing based on project use, payments, or other factors.

Use of Proceeds
How bond proceeds will be spent. This drives structuring and whether any portion may need to be taxable.

Key Parties

Municipal Advisor (MA)
Financial advisor to the issuer who helps evaluate financing options, structure, timing, and pricing strategy.

Bond Trustee
Institution (typically a bank) that holds and disburses funds and administers key payment and compliance mechanics.

Underwriter
Firm that purchases the bonds from the issuer and resells them to investors (typical in public offerings).

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