Services and Expertise

Kosmont Financial Services’ municipal advisor professionals provide financial solutions to cities, counties and public agencies that require creative funding structures to get infrastructure and economic development projects built. We have been an industry leader in developing and successfully deploying financing structures that capture multiple sources of revenue and security pledges.

By identifying and utilizing economic and regulatory resources, such as forming new or utilizing existing special districts such as Tourism Improvement Districts and Community Facilities Districts, Kosmont has been able to successfully complete several major economic development projects for our clients despite the dissolution of redevelopment agencies and the resulting loss of tax increment financing in California.

Kosmont Financial Services’ municipal advisor professionals (“KFS”) provides comprehensive continuing disclosure services designed to ensure compliance with Securities and Exchange Act Rule 15 c 2-12.

KFS has established procedures and practices to help issuers and other obligated parties to handle the burdens and to minimize cost, staff time, and their liability associated with providing continuing disclosure information to the public.

Kosmont Financial Services’ municipal advisor professionals have core expertise in tax increment financings (“TIF”) and in the issuance of economic development revenue obligations issued by counties, cities and public agencies to promote the creation of Enhanced Infrastructure Financing Districts (“EIFDs”).

EIFDs are independent government entities that may be governed by cities, counties, or special districts and offer a new platform to finance an array of economic development projects, including infrastructure. EIFDs can use multiple funding sources to finance projects within the District, such as bonds funded by tax increment. If bonds are issued by a city or county, tax increment would be available for up to 45 years from the date of the initial tax increment bonds.

View TIF Info

Kosmont Financial Services’ municipal advisor professionals provide transactional Financial Advisory Services to public agency clients as a part of and a complement to our broader array of economic development oriented services. The combination of economic development expertise and the capabilities of our Financial Advisory professionals gives the Kosmont Public Finance Team a unique skill set that is second to none.

Our professional team is qualified to assist municipal issuers with all their financing concerns, including developing pre-financing strategies, debt management planning, debt schedule budgeting, and post-financing services.

Our in-house team includes:

• Registered municipal advisors
• Financial analysts
• Former bond underwriters
• Former city administrators

Kosmont Financial Services’ municipal advisor professionals have experience with general fund and other lease supported structures such as Lease-Leaseback Financing and Certificates of Participation (“COPs”).

The primary structure that is used to leverage the general fund or the value contained in projects or facilities that will produce revenues (e.g. water and sewer utilities, parking structures) is known as “Lease-Leaseback” financing.  This approach can be utilized to install public capital improvements, resuscitate stalled real estate projects, fund economic development projects that are revenue generating, or free up “trapped equity” in (often downtown) public real estate assets.

There are two primary vehicles that are utilized to provide project funding under this approach: private lease funding and COPs.  The Public/Private Partnership (P3) approach includes a private party that installs improvements on land that is leased to it by the public agency, and then leases the land with the new improvements back to the agency.  The private entity has a vested interest in the success of the project and is involved until the financing has been amortized.

Another format involves COPs, which are securities sold in the public markets to investors where the proceeds from the sale are used to fund the desired improvements.  COPs are secured by a Lease-Leaseback agreement that is usually entered into by the public agency and another entity that is under the control of the public agency, such as a Public Finance Authority or other public-benefit agency. COPs can often be issued as tax-exempt obligations when they are used to finance public purpose projects.  COPs are useful because they are generally not considered “debt”, therefore a public agency can finance capital improvements without first obtaining voter approval.

Kosmont Financial Services’ municipal advisor professionals have significant experience in the issuance of general obligation debt issuances of all types, including the negotiation and coordination of economic development incentives supporting those debt insurance.

A joint power is a term that used to describe government agencies (including federal agencies, state departments, cities, counties, special districts, and school districts) that have agreed to combine resources and authorities to solve a common project/issue(s). Joint Powers Agreements (“JPAs”) are the formal agreements between two or more public agencies and are commonly utilized in revitalization and infrastructure projects.

Kosmont Financial Services municipal advisor professionals have experience working with and creating deals with JPAs. For example, in order to provide financing for the share of the City of South Gate’s costs towards the azalea Regional Shopping Center, Kosmont’s municipal advisor professionals devised a strategy to leverage the resources available from the City’s water and wastewater utilities. The structure involved the leasing of the City’s water and wastewater utilities to a JPA controlled by the City. The JPA loaned $8.4 million of the revenue bonds’ proceeds to the City’s General Fund, to be repaid with the project’s anticipated new sales tax and other new “site specific tax revenues”.

As registered Municipal Advisors with the Securities Exchange Commission (“SEC”), we provide Financial Advisory (“FA”) services to cities, counties, and other public agencies related to the issuance of tax-exempt and taxable bonds.

Our Financial Advisory services guide you through the bond issuance process as we:

• Select preferred underwriters
• Analyze and evaluate preferred and tailored bond structures, often with nuanced and detailed characteristics
• Provide strategic services to effectively market bonds
• Negotiate bond refunding
• Direct tax-exempt funds to finance public-private projects for economic development

Our in-house service team includes:

• registered municipal advisors
• financial analysts
• former bond underwriters
• former city administrators

Kosmont Financial Services’ (“KFS”) municipal advisor professionals provide a full range of services to assist public agencies with assessment and issuance of Pension Obligation Bonds (“POBs”). POBs are an option for many agencies to realize savings and manage budgetary pressures related to rapidly escalating pension costs.

In the current market environment with low municipal bond taxable interest rates, benefits of POBs include the potential for significant savings compared to an agency’s current Unfunded Accrued Liability (“UAL”) amortization schedule. Additionally, POB repayment schedules increase budget certainty compared to those for repayment of the existing UAL. KFS professionals work with the agency to model alternative structures and assist with all aspects of the POB issuance to meet the unique needs of the agency.

Private placements are securities that are not sold through a public offering, but instead are sold to institutional investors such as large banks, mutual funds, insurance companies, pension funds, and wealthy investors. Such securities are subject to Securities and Exchange Commission (“SEC”) regulation but they do not have to be registered with the SEC if some private placement offering requirements are met. Kosmont Financial Services municipal advisor professionals can provide assistance to clients looking to conduct private placements.

Public-private partnerships are a creative way to blend private investment with public funds for infrastructure and public improvement projects, including transportation infrastructure, public transit, airports, water and wastewater treatment, and urban development. These arrangements formed between public and private sector partners typically involve a governmental entity contracting with a private partner to renovate, construct, operate, maintain and/or manage a facility or system.

Kosmont’s municipal advisor professionals have a 29-year track record of successfully providing advisory services to the public and private sectors. We are among the most capable of companies in California to provide Financial Advisory Services and we have an unmatched track record of closing deals for economic development and real estate projects involving partnerships with public agencies and private sector investors, more commonly known as “Public/Private Partnerships” or “P3s”. Our services guide you through planning, funding and financing to implement public/private economic development projects.

Public private project financing is the financial aspect of a Public Private Partnership (P3). Kosmont Financial Services’ municipal advisor professionals have vast experience in these financial arrangements and can assist both parties in securing appropriate financing and achieving a mutual goal.

For example, Kosmont’s municipal advisor professionals worked with both the City of Redondo Beach and a private developer to identify sources and negotiate a lease-leaseback structure to fund the development of two hotels within the City. Kosmont used a pledge of future city tax revenues to provide financing to make the 319-room project feasible for both the developer and the City.

Kosmont Financial Services’ municipal advisor professionals can assist cities and counties that seek to utilize special tax districts, such as Mello-Roos Community Facilities Districts (“CFDs”), Parking & Circulation Districts, and Tourism Improvement Districts.

CFDs can raise money to finance capital improvements and services (police/fire, recreation, maintenance, etc.) within the District by levying a special tax on homeowners. These Districts require a 2/3 voter approval for both formation and taxation and have a lifespan of 40 years.

Parking and Circulation Districts can use parking and other fees and revenues to provide leverage to design, build and operate parking structures and related circulation, bicycle and pedestrian amenities.

Tourism Improvement Districts raise funds to provide services desired by and directly benefitting businesses located within the District through assessments on lodging stays.

Kosmont Financial Services’ municipal advisor professionals have core expertise in tax increment financings (“TIF”) and in the issuance of economic development revenue obligations issued by counties, cities and public agencies to promote the creation of Enhanced Infrastructure Financing Districts (“EIFDs”).

TIF is a tool that leverages the incremental growth in valuation or tax revenue within a geographic boundary of an EIFD to provide public financing for infrastructure and other improvements that support community revitalization, installment of infrastructure and economic development projects of all types.

View EIFD Info

Utility and enterprise financings involve bonds that are issued to finance projects such as electrical plants, water systems, sewer systems or any other type of public utility. Such bonds are repaid for by way of utility revenues, once the project is completed and the utility is running.

Kosmont Financial Services’ municipal advisor professionals has significant experience in the use of utility and enterprise financings. In order to finance the City’s cost of the much needed improvements for the azalea Regional Shopping Center project in the City of South Gate, Kosmont was able to leverage resources available from the City’s water and wastewater utilities. Additionally, Kosmont was able to secure a higher credit rating and lower interest payment costs.