This financing plan is based on discussions with stakeholders and leaders throughout the region and on regional market conditions for project financing. Its elements are intended to be market-based, leveraged, and financially feasible and sustainable.
The proposed financing model suggests the creation of a special purpose vehicle to provide the sewage collection and treatment services on a contract basis with the Israeli and Palestinian water authorities, using a combination of bonds, private and social equity, and subordinated debt through the capital markets, international development loans and guarantees, and philanthropic impact investments. This project financing model is feasible based on the proposed capital structure, terms, and estimated market conditions.
Further, the new infrastructure will support the growth of tourism-related revenue in the greater Jerusalem region, serving the development of the Israeli and Palestinian communities. New and expanding businesses will produce incremental value-added taxes, real estate taxes, improvement taxes, use fees, and license fees, which broaden the case for feasibility.