The Essex County Improvement Authority this week may vote on an $89 million real-estate lease-back bond deal that will help Newark balance its 2010 budget.
Authority officials selected Bank of America Merrill Lynch to underwrite the deal. Acacia Financial Group Inc. is the financial adviser. Decotiis, Fitzpatrick, Cole, & Wisler LLP is bond counsel. Officials anticipate issuing the bonds in December, according to Noreen White, Acacia's co-president.
The ECIA's final approval is the last step before the bonds go to market. Mayor Cory Booker, Newark's Municipal Council, the state, and Essex County Freeholders have all approved the transaction.
The authority will sell up to $89 million of debt to purchase up to 17 properties from Newark. The city will then make lease payments on the properties, with those funds paying down the bonds.
Newark, the state's largest city, will use about $40 million from the property sales to help balance its fiscal 2010 budget, which has a $83 million deficit. Its fiscal year ends Dec. 31. The city also will raise property-taxes and cut the city's payroll by 850 positions.