HANOVER, N.H., June 22, 2021 (GLOBE NEWSWIRE) — CTBH Partners LLC (“CTBH”) is pleased to announce the closing of $105.2 million aggregate principal amount of tax-exempt solid waste industrial revenue bonds for its client, Waste Pro USA, Inc. (“Waste Pro” or the “Borrower”). As financial advisor to the Borrower, CTBH represented Waste Pro in the issuance of the Florida Development Finance Corporation (the “Issuer”) Solid Waste Disposal Revenue Bonds (Waste Pro USA, Inc. Project) Series 2021 (the “Bonds”) for the benefit of Waste Pro.
The Bonds, which bear a 3.000% coupon for approximately 11 years, were priced at 104.584, with aggregate proceeds of approximately $110.0 million, to yield 2.375%. The Bonds will mature on June 1, 2032, and are guaranteed by certain subsidiaries of Waste Pro, pursuant to the terms of the indenture relating to the Bonds.
The Bonds are not a general obligation of the Issuer and do not constitute indebtedness of, or a charge against, the general credit of the Issuer. The Bonds are not a debt or pledge of the faith and credit of the State of Florida and are payable solely from amounts received from Waste Pro under the Loan Agreement between Waste Pro and the Issuer and from the Guarantors under the Guaranty.
Citigroup Global Markets Inc. served as the bookrunner and senior manager and Wells Fargo Securities LLC served as the co-manager for the Bonds. Greenberg Traurig, P.A. served as counsel to Waste Pro.
Overview of Private Activity Bonds
Since 1968, private companies and nonprofit organizations have been able to finance qualifying projects by borrowing the proceeds of tax-exempt private activity bonds (“PABs”) issued through a conduit issuer as an alternative to traditional corporate debt. PABs are municipal bonds issued by or on behalf of local or state governments for the purpose of providing special financing benefits for qualified private projects that serve a public purpose, including solid waste disposal facilities. Other qualifying activities under the Internal Revenue Code include airports, docks & wharves, sewage treatment facilities, local district heating, highway or surface freight transfer facilities, and qualified 501(c)(3) capital expenditures, subject to certain conditions set forth in the Internal Revenue Code.
Solid waste PABs are sometimes also referred to as industrial revenue bonds (or “IRBs”). In the context of IRBs, the Internal Revenue Code defines solid waste disposal facilities as “any property or a portion thereof used for the collection, storage, treatment, utilization, processing, or final disposal of solid waste”. Recycling facilities can also qualify in many cases.
The benefits of PABs include (i) potentially significant interest rate savings due to the tax-exempt status of the bonds, (ii) potentially longer-term debt than otherwise available, (iii) the potential of access to an additional pool of investor capital, and (iv) flexible financing structures. However, to receive these benefits, the borrower needs to comply with various federal and state regulatory requirements that may result in smaller bond issuances and a more involved bond issuance process (with pre- and post-issuance compliance requirements) than traditional corporate debt. Nevertheless, the use of PABs is wide spread across multiple industries by publicly traded and privately held companies as well as nonprofit organizations.
Based on internally collected data, the issuance of tax-exempt PABs are most prevalent with (i) healthcare facilities, (ii) colleges and universities, (iii) electric utilities, (iv) oil & gas companies, (v) airlines, as well as (vi) environmental control companies. Collectively, organizations in these industries have approximately $400 billion in tax-exempt PABs outstanding.
About Waste Pro USA, Inc.
Waste Pro is one of the country’s fastest growing privately owned waste collection, recycling, processing and disposal companies, operating in nine southeastern states. Waste Pro serves more than two million residential and 40,000 commercial customers from over 90 operating locations. Waste Pro is headquartered in Longwood, Florida, and maintains more than 250 exclusive municipal contracts and franchises.
About CTBH Partners LLC
CTBH Partners is a top-ranked independent financial advisory firm to the environmental sector, according to The Bond Buyer’s annual review of municipal bond transactions, specializing in corporate tax-exempt debt offerings for companies with qualifying capital expenditures. CTBH is registered as a Municipal Advisor with the Municipal Securities Rulemaking Board and the U.S. Securities and Exchange Commission. CTBH does not engage in any form of underwriting, trading, marketing, or investing in securities.
Since inception, CTBH has provided its consulting services to borrowers on over $360 million of tax-exempt solid waste industrial revenue bonds across six states. For further information, visit the company’s website at https://ctbhpartners.com.