General Considerations In Tribal Debt Finance
Mondaq Business Briefing › United States Law Articles in English (2011)
Linked as:
Extract
General Considerations In Tribal Debt Finance
Scope of Tribal Debt Markets
As American-Indian tribes have developed more stable sources of revenue and diversified their governmental and commercial activities over the past 20 years, they are increasingly using debt to finance their economic growth and prosperity. This debt ranges from small local bank loans (sometimes backed with federal government) to multi-hundred million dollar bond and note offerings to finance large scale economic development projects. Sources of Financing Tribal debt covers the full range of available financing sources, including: Conventional bank loans and lines of credit. Syndicated revolving credit and term loans. Capital leasing. Institutional private placements. High-yield note and Rule 144A offerings. SEC registered debt offerings. Tax-exempt debt. Tribal projects that can be financed with these sources include reservation infrastructure projects such as the building of: Roads, bridges, schools, health clinics, and water and sewer facilities. Large scale solar, biomass and similar energy projects. Most visibly, gaming and resort facilities. Legal Considerations Lending to an Indian tribe or entity presents a unique set of legal considerations with which every lawyer representing a tribe or a lender to a tribe should be familiar. This Note is not a "how to" on tribal lending or a comprehensive survey of federal Indian law. Instead, this Note introduces the principal legal issues differentiating Indian tribal finance from conventional governmental or corporate finance. These include: Tribal status and governance. General principles of sovereign immunity and jurisdiction. Government regulations applicable to Indian tribes. Certain loan documentation issues. Restrictions on granting of liens and security interests. Tribal Status and Governance While there are many Indian cultural groups, there are currently 565 federally recognized Indian tribes (including Native Alaskan entities) in the US. The Department of the Interior periodically publishes a current listing of recognized tribes in the Federal Register (click here to see t...See the full content of this document
Sponsored links
