In this session, experienced issuers and municipal advisors will discuss past refundings, their strategy, and how they measured the success of their refunding transactions. In light of the points made in prior sessions, panelists will explore the evaluation of refundings generally, the need to re-examine conventions, and the potential outcomes for altering strategy and practices in the future.

Most municipal bonds have been structured with a 5% coupon, callable at par in Year 10. Issuers pay for the considerable cost of the par call by accepting a lower sale price. Subsequent refunding, by calling or another means prior to the call date, generates cashflow savings but forfeits valuable call options. This session will explain how to factor the forfeited option value into the refunding decision using the refunding efficiency approach. Five percent bonds callable at par are virtually certain to be refunded by Year 10, even if interest rates increase. To reduce the cost of recurring transactions, the presenter will also explore alternative call structures.

How have market preferences and the needs of issuers shaped the structure of municipal bonds? Why are municipal bonds refunded before maturity or the call date? This session will examine structural conventions of municipal bonds and the inevitability of refunding. Presenters will explore latest refunding strategies, practices, and evaluation methods for achieving the highest value in a refunding transaction.

Managing the cost of financing is one of the highest priority responsibilities for agency finance professionals. Refunding is one of the most impactful financial management tools issuers can use to mitigate risk and reduce the cost of debt, or is it? The preconference sessions will explore refunding strategies, the financial justifications, the call option itself, and the circumstances when refundings may not be as efficient as issuers would like them to be. This program is intended to help issuers to understand and challenge conventions, and more fully consider the factors that can drive the success of future refunding transactions.

How are airports budgeting and managing cost escalation risk on CIPs given the tariffs and supply-chain impacts? How are credits doing in light of inflation and the many very large capital programs? How has the shift in air travel demand toward higher-end passengers affected airports of all sizes? Is airport public parking becoming obsolete given the growth of driverless cars? If so, how should airports balance near-term capacity with long-term decline risk?

In a state with constantly shifting weather-related challenges – from wildfires to droughts, flooding to earthquakes – how are we ensuring the infrastructure we build, and rebuild, can withstand these growing shocks to the system? Can issuers keep up with the rising costs? Do they have an alternative if they can’t?