Richard J. Miller and Mark-David Adams, partners with Edwards Wildman in West Palm Beach (Melanie Bell)
Dealmakers: Richard Miller and Mark-David Adams
The Deal: The Edwards Wildman attorneys acted as disclosure counsel to Miami-Dade County on the issuance of a $201 million bond to finance a portion of a massive PortMiami improvement project.
Details: The lawyers are longtime disclosure counsel to the county, drafting the offering disclosure documents, doing due diligence and continuing disclosure for many of the county’s bond issues.
In this case, the team was hired to act as the county’s disclosure counsel on a bond issue representing the final portion of the county’s contribution to port improvements.
State, county and city agencies all contributed to the $2 billion-plus improvement project, which included deep canal dredging, larger cranes, and wharf and terminal improvements to prepare for the Panama Canal expansion as well as the $900 million Port Tunnel project.
The tunnel, which is expected to ease heavy cargo and passenger traffic to the port by providing a direct route from the MacArthur Causeway, opened in late May. About 4,500 trucks are among the nearly 16,000 vehicles that visit the port each day.
The total capital cost of the port project is $665 million, with the county’s portion totaling $334 million. The county issued a $100 million bond issue for the project in 2012.
This particular deal was rushed for the team compared to their typical bond issue, as they started work on it in January and had a deadline of May 8 to repay the state. Otherwise, the county would have to pay additional interest and might have had to come up with temporary funding.
Aside from the tight time frame, the team’s biggest challenge was satisfying purchasers and credit providers after Moody’s downgraded the port revenue bonds a notch in the midst of the project.
Barclays Bank served as the underwriter. After a selection process, the Bank of Tokyo was selected as credit providers, providing a letter of credit to give buyers an additional level of comfort. Instead of using a long-term fixed bond, the lawyers obtained a weekly variable rate with a single maturity to 2050.
“Because of all the construction the port is doing, it has put pressure on their revenues,” Miller explained. “The debt service coverage has been squeezed for the time being and rating agencies have pressed down on the rating.”
Port Miami is the 11th largest cargo container port in the United States, and one in seven of the world’s cruise passengers embark at the port.
Quote: “This was a rushed deal because payments were due to the state of Florida and because the seaport tunnel was opening this month,” Miller said.
Background: He is a partner in Edwards Wildman’s West Palm Beach office and has worked there for 18 years. He specializes in corporate law, securities law, municipal and project finance, public private partnerships, interest rate swaps and other derivative products public financing. Adams is a partner based in Edwards Wildman’s West Palm Beach office and has 20 years experience in municipal finance, taxation and project finance law.