CHICAGO--()--Breaking away from their traditional pay-as-you-go method for funding County Road and Highway improvements, Cook County partnered with Wells Fargo Securities, the investment banking and capital markets business of Wells Fargo (NYSE: WFC), to create and implement a financing vehicle that funds long-term surface transportation and highway improvements, creating jobs and accelerating infrastructure projects.
“We have made great strides in my administration to leverage our financial tools more effectively to pursue critical infrastructure projects throughout Cook County”
The inaugural AAA-rated Sales Tax Revenue Bonds are part of the County’s strategic, long-term approach to its road infrastructure maintenance program. The $90 million issuance of these bonds to finance significant components of the 2012-2014 Highway Transportation Plan enables the County to create a pool of capital funds for its infrastructure improvements. Traditionally, the County had financed road and bridge infrastructure projects with its motor fuel tax, which allowed for maintenance, but was less effective for long-term improvements. With the help of the Wells Fargo Securities Public Finance team in Chicago, the County developed their first sales tax revenue bonds to tap a different investor base, thereby securing a significantly lower funding cost. These cost savings allow the county to focus on long-term improvements, while freeing up $30 million to go towards the County’s public safety systems, which comprise 40 percent of the County’s total operating budget.
“We are confident that this innovative financing saved significant taxpayer dollars by providing an extremely attractive interest rate, and this will help fund crucial infrastructure projects throughout Cook County,” said Tariq Malhance, Chief Financial Officer of Cook County.
In addition to creating a pool of capital funds for capital infrastructure investments for suburban roads, bonding off the sales tax revenues is also set to create more than 1,300 jobs in Cook County.
“We have made great strides in my administration to leverage our financial tools more effectively to pursue critical infrastructure projects throughout Cook County,” Cook County Board President Toni Preckwinkle said. “This innovative new financial strategy is an effective and efficient means to fund our needed road projects.”
“With a broader, more strategic focus, the Cook County Department of Transportation and Highways will be able to have a meaningful impact in shaping how our transportation systems impact regional economies and promote growth,” Preckwinkle said.
With 170 associates in 20 offices, Wells Fargo Securities’ Public Finance Investment Banking teams provide municipal financing solutions to government and institutional customers throughout the U.S. As of September, the Wells Fargo affiliates that comprise the Municipal Products Group rank among the top 10 underwriters of municipal securities in the U.S1.
About Wells Fargo Securities
Wells Fargo Securities delivers a comprehensive set of capital markets products and services to customers, including originating and distributing public debt and equity, hedging interest rates, commodity and equity risks, advising on mergers and acquisitions, and originating structured lending facilities and municipal bonds. The institutional capital markets business is comprised of more than 3500 team members in 40+ offices across the United States, Europe and Asia.
Wells Fargo Securities is the trade name for certain capital markets and investment banking services of Wells Fargo & Company and its subsidiaries, including Wells Fargo Securities, LLC, member NYSE, FINRA, NFA and SIPC, Wells Fargo Institutional Securities, LLC, member FINRA and SIPC, Wells Fargo Bank, National Association, Wells Fargo Securities International Limited (authorized by the U.K. FSA), Wells Fargo Securities Asia Limited (licensed by the HK SFC), and Wells Fargo Securities (Japan) Co., Ltd. (registered with the KLFB).
1 Source: Thomson Reuters. Represents combined totals underwritten 1/1/2012-9/30/2012 for Wells Fargo Securities, LLC, member NYSE, FINRA, and SIPC, and Wells Fargo Bank, N.A., subsidiaries of Wells Fargo & Company, which use the trade name Wells Fargo Securities for their capital markets and investment banking services.