McGuireWoods recently served as bond counsel to the Virginia Public School Authority (VPSA) in a $61,120,000 pooled qualified school construction bond issue – a new type of tax credit bond authorized under the American Recovery and Reinvestment Act of 2009 (ARRA). VPSA's qualified school construction bonds do not pay interest in cash. In lieu of interest, the bondholders receive annual tax credits against their federal income tax liability. This is the first issuance of qualified school construction bonds in Virginia.
The bonds finance loans to seven Virginia localities for the construction or renovation of public school buildings. These localities include the cities of Lexington, Lynchburg, Petersburg, and Portsmouth; and the counties of Fluvanna, Montgomery and Richmond. Due to Virginia's strong credit rating, VPSA sold the bonds at the lowest cost for any comparable qualified school construction bonds issued anywhere in the United States. Goldman, Sachs & Co. served as the underwriter for the bonds.