For Investors

QSCBs and QZABs represent relatively low-risk intermediate-term obligations paying a taxable yield competitive with similarly rated corporate bonds.  They may be particularly attractive to institutional investors seeking to diversify a portion of their portfolios into public tax-supported infrastructure.

As originally enacted by Congress, Qualified Zone Academy Bonds (QZABs) and Qualified School Construction Bonds (QSCBs) gave the investor an annual tax credit, which is treated like interest.  Thus, if the annual tax-credit rate for QSCBs and QZABs is 6.00%, a $1,000,000 bond would yield an annual tax credit of $60,000 for bondholders.  (Click here for the current tax-credit rate from TreasuryDirect.) 

As a result of legislation passed in March 2010, school districts can now elect to issue their QSCBs and QZABs as direct-payment bonds where the issuer receives direct cash interest payments from the Treasury up to the credit rates that would apply if the bonds had been sold as tax-credit bonds.  Thus, QSCBs and QZABs that pay cash interest are now suitable investments for non-taxable investors like Pension Funds and Endowments.  Similarly, it is no longer necessary for investors lacking tax liability to "strip" the tax credits, which should enhance bond liquidity.

Eddie Tech™ plans to achieve more efficient pricing on tax-credit bonds, due to better diversification, broader distribution, enhanced liquidity, and easier de-coupling of principal from tax credits, opening up demand for the bonds by new categories of investors.

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No securities are being offered hereby. If the securities described herein or other securities are ultimately offered, any such offer would be made only pursuant to an offering document and only after a prospective investor had completed its own independent investigation of the securities, instruments or transactions and received all information it required to make its own investment decision.  The projections or other estimates in this website (if any), including estimates or assumptions regarding interest rates, pricing levels and cost savings, are forward-looking statements based upon certain assumptions and are preliminary in nature. Accordingly, there can be no assurance that estimated or assumed interest rates, pricing levels or cost savings described herein will be realized or that actual interest rates, pricing levels or cost savings will not be materially different than those estimated or assumed herein.