Estrada Hinojosa served as Financial Advisor for the City of Laredo in the issuance of seven toll bridge financings between 1996 and 2005 for a total par amount of nearly $100 million. The firm helped to develop the initial and subsequent plans of finance for the projects and refundings. All of the transactions were negotiated sales. Estrada Hinojosa guided the City through the entire documentation process, and negotiated on behalf of the City during the pricings. Proceeds from these bonds were used to construct the U.S. portion of the new Laredo Northwest International Bridge (Bridge No. 4); to install enhanced toll collection systems and pedestrian walkways on several of the bridges; to construct facilities and approaches; and to refund bonds for debt service savings.
To succeed, the team would need to bring together pubic and private interests to complete very complex financings. The project would require a combination of foreign, federal, state, local and private funding. Challenges included working out how financing and construction costs for Bridge No. 4 could be shared by public and private interests from the U.S. and Mexico. The cost to construct the U.S. portion of Bridge No. 4 was estimated at $100 million. Another challenge was gaining eligibility for a State Infrastructure Bank (SIB) loan of $27 million, administered by the Texas Department of Transportation (TxDOT). The SIB would offer the client more attractive terms than are otherwise available through conventional financing sources, but there had never been an SIB loan closed in Texas before.
Results:
• Estrada Hinojosa closed the first SIB loan in Texas for $25.2 million to help fund the Laredo International Bridge No. 4
• Financings were successfully negotiated with the international, federal, state, local and private interests
• Cost of acquisition of rights-of-way was donated by present landowners
• Interest rates are expected to be below market for the project
• Revenues pledged to repayment are expected to exceed 1.2 times the repayment
• Estrada Hinojosa recently assisted the City with the refinancing of this loan
