Kansas City Funds New Airport Terminal with Largest Financing to Date
09/17/2020
The transaction is one of the latest in Kansas City’s 15-year relationship with HilltopSecurities.
Kansas City, Missouri, recently issued nearly $900 million in airport special obligation bonds as the first portion of financing to complete a new terminal at the Kansas City International Airport. The transaction marks the city’s largest financing project.
HilltopSecurities served as municipal advisor on the transaction, which was sold to fund construction costs that are part of the city’s International Airport Terminal Modernization Project. HilltopSecurities serves in a continuing role as advisor to the city on the airport project and all other project financing needs.
The airport special obligation bonds feature a new, unique type of credit structure to help Kansas City meet its funding requirements. The transaction was designed to mirror characteristics of the city’s general airport revenue bonds that were approved by voters in 2013. To ensure the funding meets stringent laws in the State of Missouri, the recently issued airport special obligation bonds structure did not require an additional vote from the public and the bonds are subject to appropriation.
“The Kansas City International Airport plays a key role in the city’s economy,” said HilltopSecurities Regional Managing Director George Williford. “HilltopSecurities is proud to help Kansas City develop solutions that improve its vital infrastructure and contribute toward a greater quality of life for its residents.”
HilltopSecurities has served as municipal advisor to Kansas City for almost 15 years, and has worked with the city to structure financing projects across various sectors that benefit the community and economy.
Water and Waste Water
In June, HilltopSecurities assisted the City in the issuance of water revenue improvement bonds totaling more than $79 million. Proceeds from the improvement bond sale will fund upgrades to the city’s water and distribution systems that help protect the health of Kansas City residents.
HilltopSecurities is also helping the city meet its water and waste water system revenue and capital needs by maintaining independent long-term financial plans and comprehensive capital planning models. This ongoing long-term financial modeling provides the city an important tool in implementing and maintaining a capital improvement plan to address a $2.5 billion EPA consent decree on the waste water system.
Kansas City Downtown Redevelopment District and Arena
In 2017, HilltopSecurities successfully implemented a financing plan for the city’s T-Mobile Center and Downtown Redevelopment District, known as KC Live.
To help support the city’s debt structuring needs, HilltopSecurities converted the variable rate bonds originally issued in 2003 – designated for construction of the KC Live area – into fixed rate bonds. Throughout the engagement, HilltopSecurities has assisted the city in restructuring the KC Live and Arena debt obligations and continues to provide ongoing support in monitoring the city’s debt portfolio as it relates to the revenue performance of vital infrastructure projects.
Over the years, the downtown area that includes KC Live and the T-Mobile Center has developed into a full-scale entertainment district. The KC Live area anchors more than $6 billion in reinvestment in downtown Kansas City and the T-Mobile Center hosts more than 100 ticketed events annually.
Kansas City Downtown Streetcar Initiative
Kansas City has been working to extend the KC Downtown Streetcar line southward to serve Midtown, Westport, the Art Museum District, the Plaza, and the University of Missouri-Kansas City. HilltopSecurities served as municipal advisor on the initial funding as well as the city’s recent issuance of $9.1 million in tax-exempt bonds to help fund start-up costs for the extension project.
HilltopSecurities built a financing structure that will provide the city enough funding to complete the transit system. The improvements and planned additions to the KC Downtown Streetcar line will continue to provide transportation to a larger population and is projected to create thousands of jobs and continue to benefit the economy in the coming years.
Hilltop Securities Inc. (HTS) is a registered broker-dealer, registered investment adviser and municipal advisor firm that does not provide tax or legal advice. This document is intended for educational/informational purposes and institutional use only. This document does not constitute legal or investment advice, nor is it an offer or a solicitation of an offer to buy or sell any investment or other specific product or service. HTS is a wholly owned subsidiary of Hilltop Holdings, Inc. (NYSE: HTH) located at 1201 Elm Street, Suite 3500, Dallas, Texas 75270. Member: NYSE/FINRA/SIPC.
