Innovative financing transaction structured by Bryant Miller Olive named "Revenue Bond Program Deal of the Year" by Washington, D.C. Economic Partnership
Bryant M iller Olive (BMO) recently structured the nation’s first financing
package involving the use of Property Assessed Clean Energy (PACE) financing with tax-exempt funds. The innovative deal was selected as the Washington, D.C. Economic Partnership’s Michael V. Hodge DC Revenue Bond Program Deal of the Year for 2016.
The deal was facilitated to finance a new headquarters for Far Southeast Family Strengthening Collaborative (FSFSC), a nonprofit provider of supportive social services in Ward 8 of the District of Columbia. The headquarters will be 31,000 square feet with street level retail in the Historic 
Anacostia neighborhood.
When BMO was retained for the project, it was anticipated to be a simple revenue bond financing deal. Ne
arly two years later, the financing morphed from a simple bond deal into a complex financing transaction consisting of a capital stack with six funding sources.
“The FSFSC project demonstrates for the first time ever, how to use low-cost, tax-exempt financing to fund PACE projects and extend the construction budgets of community-based organizations,” said Bracken Hendricks, CEO of Urban Ingenuity, the DC PACE administrator.
“PACE can drive down energy bills and lower the cost of building improvements for non-profit organizations like FSFSC,” Hendricks added, “allowing them to put their precious dollars to work where they belong, serving the community and improving the lives of working people in Washington, D.C.”
PACE provides private-sector capital to property owners for energy or water saving improvements, with 100 percent upfront financing to be repaid through a special assessment on the property owner’s tax bill.
“By determining that the District could offer a tax-exempt benefit on its PACE notes issued for the benefit of a 501(c)(3) corporation like FSFSC, Bryant Miller Olive was able to identify an additional tax-exempt funding source for the FSFSC project,” said Keirston Woods, a shareholder with Bryant Miller Olive who led the law firm’s team on the project. “We are so pleased to have been able to be a part of this trailblazing transaction, working with such a commendable organization.”
The total project cost is approximately $14.4 million funded through a $3 million grant from the District of Columbia; a $2.2 million PACE equity contribution; $8.16 million of DC Revenue Bond debt; and $1.25 million of FSFSC equity.
The Michael V. Hodge DC Revenue Bond Deal of the Year Award, named after the agency’s first director, recognizes the year’s top revenue bond-financed deal that used unique financing structures and made a significant contribution to the District’s economic landscape.
