Regional Bond Fund Expansion Finalized
June 5, 2015
Gail Paul, Director of Communication Strategy
Port of Greater Cincinnati Development Authority
Regional Bond Fund Expansion Finalized
Port of Greater Cincinnati Development Authority and Dayton/Montgomery County Port Authority partner on expanded financing tool
CINCINNATI, OH – The Port of Greater Cincinnati Development Authority today announced it has become an eligible issuer of economic development revenue bonds for the Southwest Ohio Regional Bond Fund, created from the expansion of the Dayton-region Port Authority bond fund.
The Cincinnati Port Authority joins Dayton/Montgomery County Port Authority as issuing agency for the bond fund. The two port authorities recently finalized a cooperative agreement that defines their respective roles, determines what kinds of job-creating projects are eligible and establishes a credit committee to develop underwriting standards used for all projects under consideration.
Dayton’s Port Authority established its Dayton Regional Bond Fund in 2004 as a vehicle for financing economic development projects. The two port authorities agreed in 2014 to allow the Cincinnati Port to participate in the Dayton bond fund through a $3.5 million addition to the Bond Fund’s reserves Combined with Dayton’s existing $10 million in reserves, the new fund now has approximately $13.5 million in reserves, creating capacity to issue $80 million in bonds. The bond fund reserves include a $5 million letter of credit from 5/3 Bank, in which both Ports partner.
A bond fund is a credit-enhancement vehicle supported by a system of common program reserves and designed to achieve an investment grade rating. The Southwest Ohio Regional Bond Fund gives companies and organizations access to long-term, fixed-rate financing to fund facility expansion, make energy efficiency investments, and purchase new equipment.
Four other Ohio port authorities operate bond funds. The effort to create a bond fund in Cincinnati began several years ago, in response to demand for innovative financing strategies that foster growth. As an alternative to pursuing the lengthy process to create its own bond fund, the Cincinnati port authority sought guidance from Dayton/Montgomery County. The two port authorities agreed to continue to work collegially to support and strengthen one another’s business attraction and retention efforts. Collaboration not only increases the debt capacity of the bond fund, but also creates operating efficiencies for the bond fund.
Companies and municipalities increasingly rely on Port Authority finance tools to fund expansion and capital investment. Port Authorities have unique and broad development powers and expertise.
The port authorities are working to grow the program so that the fund is able to achieve investment grade rating by credit rating agencies.
Cincinnati Mayor John Cranley: “I have great admiration for Mayor Whaley and how she has led the charge for building business in the City of Dayton. Through our friendship and shared commitment to economic development, we have developed a united network to support businesses, attract new investment and create jobs. The new bond fund expands upon those opportunities.”
Dayton Mayor Nan Whaley: “This is another great example of partnership between Dayton and Cincinnati. I applaud the expansion of this important economic development resource designed to facilitate and finance economic development projects. Much like our cities’ continued cooperation with the Investing in Manufacturing Communities Partnership designation that created the 27-county aerospace corridor, the new Southwest Ohio Regional Bond Fund will have beneficial economic impact across the broader region.”
Hamilton County Commission President Greg Hartmann: “This is great news for Hamilton County and for the entire Dayton/Cincinnati business corridor. Expanding resources to growing businesses through a Port Authority bond fund is another growth and development tool.”
Deborah Lieberman, Montgomery County Commission President: “The Cincinnati-Dayton super-corridor is focused on creating a superb environment for growth and innovation. The Regional Bond Fund aligns perfectly with Montgomery County’s philosophy of investing in people and progressive projects. This joint venture is an important tool to help finance these investments.”
Laura Brunner, President & CEO of the Port of Greater Cincinnati Development Authority: “We are very excited to bring this important financing option to 14 counties within our region and give credit to our Dayton peers for working out a way for us to buy into their bond fund and rebrand it. We have received wonderful support from Hamilton County, which provided a $1 million grant and Ohio Development Services Agency, which made a $2.5 million loan that enabled us to participate.”
Jerry Brunswick, President & Executive Director of the Dayton/Montgomery County Port Authority: “The broad development powers afforded to port authorities allow us to issue taxable or tax-exempt bonds through these bond funds to finance a variety of economic development projects. The Southwest Ohio Regional Bond Fund can offer very attractive terms on project capital and can be combined with other public finance programs. This is an easy program to use – simply call us to discuss your project.”
Johnna Reeder, president & CEO, REDI Cincinnati: “Creating a bond fund has been a regional economic development priority for a long time. The Southwest Ohio Regional Bond Fund will now fund expansion for dozens of companies. At the Regional Economic Development Initiative (REDI) Cincinnati, we look forward to offering this attractive incentive for companies re-locating to our area. It is well suited for manufacturers and will help us develop manufacturing sites and infrastructure to invigorate the economic vitality of the region.”
Jeffrey Hoagland, President & CEO, Dayton Development Coalition: “The Dayton region has seen tremendous growth over the past few years and having another funding opportunity will only strengthen the growth in the Dayton region. We are fortunate to work closely with the Cincinnati community as we see both regions contributing to the overall growth in the State of Ohio.”
About the Port of Greater Cincinnati Development Authority:
The Port of Greater Cincinnati Development Authority is an economic development agency that initiates projects to improve property value and promote job creation throughout Hamilton County. It is governed by business and community leaders that comprise its board of directors. For more information, visit www.cincinnatiport.org.
About the Dayton/Montgomery County Port Authority:
Dayton/Montgomery County Port Authority facilitates economic development through project financing vehicles and real estate ownership and by offering its own long-term fixed rate financing program. It is governed by a board of business and community leaders. It was created by the City of Dayton and Montgomery County, in cooperation with the Dayton Development Coalition, to facilitate economic development in the Dayton Region. For more information, visit www.daytonport.com.