Developmental Disabilities Institute, Inc. (“DDI”), a NY not-for-profit 501(c)(3) organization, was founded in 1961, to address the special needs of children with Autism and other developmental disabilities, and provide therapeutic intervention. Today, DDI is a multi-site agency serving over 1,500 children and adults with Autism and related disorders, providing educational, residential, day habilitation and vocational services, as well as medical and dental services to over 5,000 patients through its Healthcare division across Long Island.
DDI sought to (i) finance $11.7 million of new capital projects that included (a) two individualized residential alternative (IRA) facilities, (b) a Day Habilitation Facility, (c) an Intermediate Care Facility (ICF) and (d) an Early childhood education and care facility, and (ii) achieve economic savings through the refinancing of certain outstanding indebtedness.
Solution and Execution
GATES was engaged by DDI to structure a Bond transaction that allowed them to both fund these capital projects and refund outstanding indebtedness. To that end, GATES reviewed DDI’s debt structure and found $11.97 million of Bonds eligible for refinancing that could produce substantial cash flow savings. GATES identified, solicited and procured extremely competitive bond purchase proposals from a large host of commercial banks that understood the funding streams of organizations such as DDI. After deliberation with DDI, two commercial institutions were chosen to participate in the financing.
Based on the locations of the twelve separate projects, two issuers were used for the Bond transaction. The Town of Huntington Local Development Corporation issued $19.654 million of Bonds and The Suffolk County Economic Development Corporation issued $5.602 million of Bonds on behalf of DDI. Final pricing on the Bonds yielded aggressive fixed interest rates (ten to fifteen years depending on Bond Series) producing substantial NPV savings to DDI.