Archive for May, 2011

Small Businesses Need Plan to Seek Financing

Sunday, May 29th, 2011

But as the economy works its way forward, financing for small firms will also come back, and small businesses should be educated about the opportunities. From bank loans to peer lending, options for small businesses can be confusing and overwhelming.

Romney not ruling out self-financing

Sunday, May 29th, 2011

By Matt Viser, Globe Staff

LAS VEGAS ? Mitt Romney, while clearly buoyed by the $10.25 million his supporters raised today, is nonetheless not ready to rule out what could become another potent financial weapon in his all-but-certain presidential run: tapping into his own personal wealth.

?That?s counsel I?m going to keep with Ann and myself, and that?s all,? he said, referring to his wife. ?So I can?t give you any more update than that. We?re just going to keep that to our own counsel.?

The decision could be significant, not only on Romney’s pocketbook but also on the contours of the race. During the former Massachusetts governor?s 2008 presidential campaign, he used $42 million of his own funds. One of Romney?s potential rivals — Jon Huntsman Jr., who comes from a wealthy family ? has already ruled out self-financing his campaign.

?If we were to get in the race ? no self-financing,? Huntsman told reporters recently in South Carolina. ?Unless you can raise it legitimately, you?re not going to win.?

Romney spoke to reporters after an event here held on the campus at the University of Nevada Las Vegas. He met with a dozen Republican students, delivering a economic-filled message along with burgers and fries from In-n-Out Burger (Romney dug in, taking large bites of a burger while the students nibbled on some fries: ?Looks like I?m the only guy who wanted a burger at four in the afternoon,? Romney joked.)

Romney also commented this afternoon for the first time on the decision of his former rival ? Mike Huckabee ? to not pursue a second presidential bid.

?I took that news with mixed emotions,? Romney said. ?On the one hand, I?m happy to not be facing a tough and effective competitor in Mike. But on the other hand, he?d be a veteran and we?d have good times together. And I?ll miss him on the campaign trail.?

Romney also continued to explain his position on health care, one in which he fully backs the plan his signed as governor of Massachusetts while still criticizing a similar plan on the national level signed last year by President Obama. As part of that explanation, he trotted out a new analogy, comparing states’ ability to regulate health care with their ability to also regulate education.

?We have in my state a curriculum that we provide to all of our schools, our high schools, and we test kids across the state on our curriculum,? Romney said. ?I like what we?ve done, it?s a pretty good job. But the last thing I?d suggest is to take the Massachusetts curriculum for schools and have President Obama tell every state they?ve got to use the Massachusetts curriculum. That would make no sense at all. The needs of different students and the rights of people in different states have to be recognized.?

But while Romney has called for a full repeal of the health care legislation ? saying that would be his first action as president ? he is not prepared to say that same for financial reform legislation.

Romney has recently criticized the financial reform bill that was approved last year in response to the financial mismanagement that contributed to the economic collapse.

?Whether you repeal the whole bill wholesale is something which you?d have to resolve after you had a chance to look at each of the pieces of regulation that comes forward,? he said. ?But clearly the consumers deserve protection.?

?Legislation and regulation is important, but the level of over-regulation and burden which has been placed on the financial services sector I think is unnecessary and will cost us jobs down the road,? he added.

Romney also made an appeal here to Hispanic voters, saying his party had to do more to win over a growing segment of the American electorate.

?In my view we as a party must connect with Hispanic voters,? Romney said. ?If we do our job and do our job well, we?ll have Hispanic voters voting for conservatives, voting for Republicans, because ours is the party of opportunity. And people who come here as immigrants overwhelmingly come here for opportunity, not for checks from government.?

Matt Viser can be reached at maviser@globe.com. Follow him on Twitter @mviser.

S&P Text: Unlikely That Italy To Require External Financing -2

Sunday, May 29th, 2011

WASHINGTON (MNI) – Standard amp; Poors Monday released an FAQ
providing further detail behind its May 20 decision to revise its
outlook on Italy to negative. Samp;P said the sheer size of Italys
general government debt would make it very difficult for the
international community to provide an effective financial support
framework for Italy. The following is the second and final part of the
full text of the FAQ:

What fiscal measures has Italy taken in 2011? Are these credible?

The governments fiscal consolidation program for 2011-2013 was
presented in the summer of 2010 and aims to reduce the fiscal deficit to
below 3% of GDP by 2012. We anticipate that Italy will likely attempt to
achieve around three-quarters of its deficit reduction by containing
expenditure, particularly on the public sector wage bill,
across-the-board departmental consumption transfers to local
governments, and capital expenditures. The government hasnt budgeted
for any outright nominal cuts to the high current expenditures. The
governments main revenue side assumptions rely on further improvements
in tax collection.

While these measures could deliver the governments targets, in our
view, theyll only have their intended effect if the economy continues
to expand at a rate above 1%. Average elasticity of government tax
collection to GDP growth has been around 0.6, meaning that if growth
underperforms by 1% of GDP, revenue is likely to fall by around 0.6% of
GDP. In our downside case scenario, which assumes weaker growth of 0.8%
annually, the public debt ratio could stagnate at currently high levels.

How would you compare the factors weighing on the rating on Italy
to the constraints on the creditworthiness of the Kingdom of Spain,
given that both ratings now have negative outlooks?

Low growth prospects over the next few years could cause fiscal
difficulties in both countries, but the burden of public sector debt
they started with was very different. Gross general government debt in
Spain (AA/Negative/A-1+) is around 70% of GDP, much lower than the debt
burden of 120% in Italy. This explains the two-notch difference in the
ratings.

The negative outlook on Spain reflects our view that Spains
contingent liabilities from the financial sector could end up as
explicit government liabilities. In contrast, the Italian banking sector
is now, in our view, in a stronger financial position than it was six
months ago. It has recently been strengthened by additional capital
issuance. We do not expect the Italian government to need to provide
direct assistance to its banking system in the near term; on the
contrary, we expect most of the Tremonti bonds, which provided Tier I
capital for four banks during the recession, to be repaid this year.

Could Italy run into external financing problems like other EMU
peripheral sovereigns?

Italys strong household and corporate balance sheets have enabled
the government to fund itself at historically low rates, and we expect
that these low rates could facilitate a more-gradual fiscal adjustment
in Italy compared with many of its southern European neighbors. The net
external assets (including outbound foreign direct investment and
equity) of Italys corporate sector amount to 42% of GDP, or twice the
net external liabilities of its financial sector. However, the public
sectors net external liability is high compared to other large European
countries, at equivalent to 782 billion (50% of GDP).

Despite its very high level of government debt, we observe that
Italy hasnt been affected by the liquidity crisis as strongly as the
rest of the countries on the periphery of the European Monetary Union
(EMU). We believe this is because it hadnt experienced a credit boom or
external imbalances similar to those weve witnessed among other
sovereigns at the EMU periphery. The absence of a prior asset and credit
bubble makes the Italian adjustment path much smoother and less
disruptive fiscally and financially, in our view.

We do not expect Italy to request assistance from the EU or
International Monetary Fund (IMF). Unlike Ireland (BBB+/Stable/A-2),
Greece (B/Watch Neg/C), Portugal (BBB-/Negative/A-3), and Spain, we
understand that Italian banks have made little use of the European
Central Banks liquidity facilities to date.

We also consider that the sheer size of Italys general government
debt would make it very difficult for the international community to
provide an effective financial support framework for Italy. For example,
we expect that Italy will seek to roll over close to 300 billion of
maturing long-term debt plus stock of short-term debt in 2011 alone, in
addition to the financing required to cover the current years budget
deficit. This amount exceeds the current lending capacity of the
European Financial Stability Facility (EFSF, AAA/Stable/A-1+).

We therefore believe that Italy is simply too large a debtor to be
a plausible customer of the EFSF or its successor the European Stability
Mechanism, which will take over its role in the summer of 2013. However,
as described above, we believe that it is currently unlikely that Italy
would need official external financing because of the absence of
significant imbalances. Also, in our view, the Italian government has in
the past demonstrated an understanding of the need to maintain cautious
fiscal policies.

(2 of 2)

** Market News International Washington Bureau: 202-371-2121 **

Big real estate financing returns to NYC

Saturday, May 28th, 2011

Big real estate financing returns to NYC

May 16, 2011 06:30PM

Financing for New York City real estate projects is back. Of the top 35 deals done in the last 12 months, 24 were refinancing and nine were new loans taken out of acquisitions, according to Crains. The largest deal was an $800 million refinancing of 245 Park Avenue, between 46th and 47th streets, for which Brookfield Asset Management and ING Clarion tapped the Bank of China in September 2010. It was followed closely by Boston Properties $700 million loan from MetLife for the Citigroup Center at 153 East 53rd Street, between Third and Lexington avenues, in March 2011, and a $650 million refinancing of One Bryant Park between 42nd and 43rd streets in June last year by Bank of America.

Even the smallest of the 35 financings topped $100 million — the $110 million refinancing of 200 Water Street between John and Fulton streets, arranged by Freddie Mac for Rockrose Development.

Despite talk that investment banks were not actively lending, MetLife, which financed two top-ten deals, and Pacific Life Insurance, which financed one, were among the lenders.

Were seeing big loans again, Dan Fasulo, Managing Director of Real Capital Analytics, told Crains. Its a very healthy sign that liquidity has returned to the marketplace. [Crains]

Tags:

153 east 53rd street

200 water street

245 park avenue

Dan Fasulo

bank of china

Hudson Transmission Partners Closes Financing and Commences Construction of …

Saturday, May 28th, 2011

FAIRFIELD, Conn., May 23, 2011 /PRNewswire/ — Hudson Transmission Partners, LLC (HTP), developer of the Hudson Transmission project, an underground and underwater cable between New Jersey and Manhattan, has announced that it has closed financing totaling more than $850 million in debt and equity for construction of the project. In conjunction with the closing, HTP has issued Notice to Proceed to its principal contractors, Siemens Power Transmission and Distribution, Inc. and Prysmian Cables and Systems USA, LLC. Completion of the Hudson project is scheduled for the summer of 2013.

Equity financing for the Hudson Project is being provided by private equity funds managed by Energy Investors Funds and Starwood Energy Group Global, LLC. Debt financing is being provided by a consortium of institutional investors through a private placement arranged by SG Americas Securities, LLC and RBS Securities, Inc.

The Hudson transmission cable will provide a source of electric power for the New York Power Authority (NYPA) to serve NYPAs governmental customers in New York City using High Voltage Direct Current (HVDC) technology. An electrical converter station will be constructed in Ridgefield, New Jersey, where alternating current (AC) power from the PJM grid will be converted to DC power, and then back to AC. The cable will then be buried along existing rights-of-way to Edgewater, New Jersey, where it will enter the Hudson River. The cable will be buried beneath the river bottom for approximately three miles before making landfall near Pier 92 in Manhattan, and then be routed beneath New York City streets for a short distance and interconnect at the ConEd West 49th Street substation.

Closing financing and issuing Notice to Proceed represents almost six years of effort in conceiving the project, obtaining key permits, acquiring real estate rights, and negotiating major agreements, said Ed Stern, HTPs President and Chief Executive Officer. We have a lot of people to thank for their assistance and cooperation, including NYPA, our debt and equity investors, the Federal Energy Regulatory Commission, ConEd, PJM, and the New York Independent System Operator. We are also grateful for the support and dedication of numerous officials and authorities at all levels of government, including, among others, United States Senators Chuck Schumer and Kirsten Gillibrand of New York, Congressman Jerrold Nadler of New York, Mayor Michael Bloomberg and City Council Speaker Christine Quinn of New York City, and Governor Chris Christie of New Jersey.

We are particularly thankful for the support of Governor Andrew Cuomo, whose election to the governorship of New York provided the needed impetus to complete our lengthy development phase and move the project into construction and toward completion, Stern said.

Noting that the Hudson Project has a useful life expectancy of 40 to 50 years, Stern said, The Hudson Project will be a key piece of important infrastructure for New York City, representing not only a new source of lower-cost power but substantially greater reliability and energy security for New Yorkers.

In late 2006, NYPA selected HTP to provide access to the PJM electricity system and to its diverse source of supply to meet energy demand for governmental customers. The cable will be capable of delivering up to 660 megawatts of new electric power supply, of which 495 MW of transmission capacity will be used by NYPA under a long-term agreement with HTP. The remaining 165 MW of transmission capacity will be made available to other customers on a merchant basis, Stern said.

The Hudson Project has received all necessary major permits and approvals for construction, including a permit from the US Army Corps of Engineers for installation in the Hudson River, a Certificate of Environmental Compatibility and Public Need from the New York State Department of Public Service, and a Waterfront Development Permit from the New Jersey Department of Environmental Protection. In addition, plans for the converter station have received approval from the New Jersey Meadowlands Commission, and installation of the cable in New York City has been approved by City government agencies.

The Hudson Project converter station to be built in Ridgefield will act to enhance controllability and reliability of the power supply. The power cable will be manufactured and installed by Prysmian, while converter station technology will be provided by Siemens. Both Prysmian and Siemens are leading global suppliers of electricity-related equipment and services.

The Hudson Project has been developed and will be built and operated by substantially the same team of individuals and companies that was responsible for the development, construction, and operation of the Neptune Regional Transmission project, a 660-MW undersea and underground electric cable between New Jersey and Long Island that was completed in June 2007, on time and on budget. The Hudson and Neptune projects are managed by subsidiaries of PowerBridge, LLC of Fairfield, Connecticut.

For more information, visit www.hudsonproject.com and www.powerbridge.us.

SOURCE Starwood Energy Group Global, LLC

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RELATED LINKS

http://www.hudsonproject.com

ORRV Reaches Agreement for $2 Million in Financing for the Tradewinds Project

Thursday, May 26th, 2011

PEORIA, Ill., May 23, 2011 /PRNewswire/ — Oceanic Research and Recovery Inc. (PINKSHEETS: ORRV), a marine salvage and exploration company, today announced that it has reached an agreement for USD$2,000,000 in financing for its operations in the Philippines. Known as the Tradewinds Project, this venture is a long term effort planned and organized to locate and recover multiple shipwrecks in the Philippines over the next 5 years.

To date, the ORRV team has already located two colonial era shipwrecks believed to be high value targets. Both targets were located where detailed historical research indicated they had sunk. These wrecks lie at depths which made contemporary salvage impossible and require sophisticated diving operations even by modern diving standards. Due to these factors, among others, its believed their cargos lie relatively intact.

The next phase of operations, planned to start in the coming weeks, will be conducted while working in cooperation with the National Museum of the Philippines and other governmental agencies. Currently ORRV is organizing legal, logistical and operational requirements to proceed with the next phase.

ORRV routinely seeks to partner with qualified organizations in various aspects of the projects it develops. When developing a project in the waters of a foreign country a local partner is often sought out to help facilitate logistical and operational issues, while qualified legal council is hired to address contract issues with the host government.

Project financing is another key area where ORRV attempts to partner with other organizations and is a cornerstone of the ORRV business model. Third party financing permits projects to be undertaken without diluting existing shareholders. The partner receives its share of the cargo salvaged as compensation for its involvement.

This financing model has several practical benefits, said Scott Heimdal, CEO of ORRV. It mitigates risk to the company while avoiding dilution for shareholders. For our financing partners, continued Mr. Heimdal, besides receiving their investment returns in precious metals and other high value items, there are often significant tax benefits for them as well.

Details of the financing agreement will be released in the coming days.

Organizations wishing to learn more about how they can participate in one or more ORRV projects may contact the company by sending email to inquiries@orrvweb.com.

Please visit our Website or Facebook Page or Follow us on Twitter

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Statements in this press release may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of risk factors inherent in doing business. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. The company has no obligation to update these forward-looking statements.

For additional information or to facilitate interviews, please contact:

Terry L. Towery
ORRV Communications Director
309-696-4249
Terry.Towery@orrvweb.com

SOURCE Oceanic Research and Recovery Inc.

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Hudson Transmission Partners Closes Financing and Commences Construction of …

Thursday, May 26th, 2011

FAIRFIELD, Conn., May 23, 2011 /PRNewswire/ — Hudson Transmission Partners, LLC (HTP), developer of the Hudson Transmission project, an underground and underwater cable between New Jersey and Manhattan, has announced that it has closed financing totaling more than $850 million in debt and equity for construction of the project. In conjunction with the closing, HTP has issued Notice to Proceed to its principal contractors, Siemens Power Transmission and Distribution, Inc. and Prysmian Cables and Systems USA, LLC. Completion of the Hudson project is scheduled for the summer of 2013.

Equity financing for the Hudson Project is being provided by private equity funds managed by Energy Investors Funds and Starwood Energy Group Global, LLC. Debt financing is being provided by a consortium of institutional investors through a private placement arranged by SG Americas Securities, LLC and RBS Securities, Inc.

The Hudson transmission cable will provide a source of electric power for the New York Power Authority (NYPA) to serve NYPAs governmental customers in New York City using High Voltage Direct Current (HVDC) technology. An electrical converter station will be constructed in Ridgefield, New Jersey, where alternating current (AC) power from the PJM grid will be converted to DC power, and then back to AC. The cable will then be buried along existing rights-of-way to Edgewater, New Jersey, where it will enter the Hudson River. The cable will be buried beneath the river bottom for approximately three miles before making landfall near Pier 92 in Manhattan, and then be routed beneath New York City streets for a short distance and interconnect at the ConEd West 49th Street substation.

Closing financing and issuing Notice to Proceed represents almost six years of effort in conceiving the project, obtaining key permits, acquiring real estate rights, and negotiating major agreements, said Ed Stern, HTPs President and Chief Executive Officer. We have a lot of people to thank for their assistance and cooperation, including NYPA, our debt and equity investors, the Federal Energy Regulatory Commission, ConEd, PJM, and the New York Independent System Operator. We are also grateful for the support and dedication of numerous officials and authorities at all levels of government, including, among others, United States Senators Chuck Schumer and Kirsten Gillibrand of New York, Congressman Jerrold Nadler of New York, Mayor Michael Bloomberg and City Council Speaker Christine Quinn of New York City, and Governor Chris Christie of New Jersey.

We are particularly thankful for the support of Governor Andrew Cuomo, whose election to the governorship of New York provided the needed impetus to complete our lengthy development phase and move the project into construction and toward completion, Stern said.

Noting that the Hudson Project has a useful life expectancy of 40 to 50 years, Stern said, The Hudson Project will be a key piece of important infrastructure for New York City, representing not only a new source of lower-cost power but substantially greater reliability and energy security for New Yorkers.

In late 2006, NYPA selected HTP to provide access to the PJM electricity system and to its diverse source of supply to meet energy demand for governmental customers. The cable will be capable of delivering up to 660 megawatts of new electric power supply, of which 495 MW of transmission capacity will be used by NYPA under a long-term agreement with HTP. The remaining 165 MW of transmission capacity will be made available to other customers on a merchant basis, Stern said.

The Hudson Project has received all necessary major permits and approvals for construction, including a permit from the US Army Corps of Engineers for installation in the Hudson River, a Certificate of Environmental Compatibility and Public Need from the New York State Department of Public Service, and a Waterfront Development Permit from the New Jersey Department of Environmental Protection. In addition, plans for the converter station have received approval from the New Jersey Meadowlands Commission, and installation of the cable in New York City has been approved by City government agencies.

The Hudson Project converter station to be built in Ridgefield will act to enhance controllability and reliability of the power supply. The power cable will be manufactured and installed by Prysmian, while converter station technology will be provided by Siemens. Both Prysmian and Siemens are leading global suppliers of electricity-related equipment and services.

The Hudson Project has been developed and will be built and operated by substantially the same team of individuals and companies that was responsible for the development, construction, and operation of the Neptune Regional Transmission project, a 660-MW undersea and underground electric cable between New Jersey and Long Island that was completed in June 2007, on time and on budget. The Hudson and Neptune projects are managed by subsidiaries of PowerBridge, LLC of Fairfield, Connecticut.

For more information, visit www.hudsonproject.com and www.powerbridge.us.

SOURCE Starwood Energy Group Global, LLC

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RELATED LINKS

http://www.hudsonproject.com

Romney not ruling out self-financing

Wednesday, May 25th, 2011

By Matt Viser, Globe Staff

LAS VEGAS ? Mitt Romney, while clearly buoyed by the $10.25 million his supporters raised today, is nonetheless not ready to rule out what could become another potent financial weapon in his all-but-certain presidential run: tapping into his own personal wealth.

?That?s counsel I?m going to keep with Ann and myself, and that?s all,? he said, referring to his wife. ?So I can?t give you any more update than that. We?re just going to keep that to our own counsel.?

The decision could be significant, not only on Romney’s pocketbook but also on the contours of the race. During the former Massachusetts governor?s 2008 presidential campaign, he used $42 million of his own funds. One of Romney?s potential rivals — Jon Huntsman Jr., who comes from a wealthy family ? has already ruled out self-financing his campaign.

?If we were to get in the race ? no self-financing,? Huntsman told reporters recently in South Carolina. ?Unless you can raise it legitimately, you?re not going to win.?

Romney spoke to reporters after an event here held on the campus at the University of Nevada Las Vegas. He met with a dozen Republican students, delivering a economic-filled message along with burgers and fries from In-n-Out Burger (Romney dug in, taking large bites of a burger while the students nibbled on some fries: ?Looks like I?m the only guy who wanted a burger at four in the afternoon,? Romney joked.)

Romney also commented this afternoon for the first time on the decision of his former rival ? Mike Huckabee ? to not pursue a second presidential bid.

?I took that news with mixed emotions,? Romney said. ?On the one hand, I?m happy to not be facing a tough and effective competitor in Mike. But on the other hand, he?d be a veteran and we?d have good times together. And I?ll miss him on the campaign trail.?

Romney also continued to explain his position on health care, one in which he fully backs the plan his signed as governor of Massachusetts while still criticizing a similar plan on the national level signed last year by President Obama. As part of that explanation, he trotted out a new analogy, comparing states’ ability to regulate health care with their ability to also regulate education.

?We have in my state a curriculum that we provide to all of our schools, our high schools, and we test kids across the state on our curriculum,? Romney said. ?I like what we?ve done, it?s a pretty good job. But the last thing I?d suggest is to take the Massachusetts curriculum for schools and have President Obama tell every state they?ve got to use the Massachusetts curriculum. That would make no sense at all. The needs of different students and the rights of people in different states have to be recognized.?

But while Romney has called for a full repeal of the health care legislation ? saying that would be his first action as president ? he is not prepared to say that same for financial reform legislation.

Romney has recently criticized the financial reform bill that was approved last year in response to the financial mismanagement that contributed to the economic collapse.

?Whether you repeal the whole bill wholesale is something which you?d have to resolve after you had a chance to look at each of the pieces of regulation that comes forward,? he said. ?But clearly the consumers deserve protection.?

?Legislation and regulation is important, but the level of over-regulation and burden which has been placed on the financial services sector I think is unnecessary and will cost us jobs down the road,? he added.

Romney also made an appeal here to Hispanic voters, saying his party had to do more to win over a growing segment of the American electorate.

?In my view we as a party must connect with Hispanic voters,? Romney said. ?If we do our job and do our job well, we?ll have Hispanic voters voting for conservatives, voting for Republicans, because ours is the party of opportunity. And people who come here as immigrants overwhelmingly come here for opportunity, not for checks from government.?

Matt Viser can be reached at maviser@globe.com. Follow him on Twitter @mviser.

HUD Secretary Praises Museum Plaza Financing Plan

Tuesday, May 24th, 2011

US Department of Housing and Urban Development Secretary Shaun Donovan says he supports the efforts to use a HUD-approved loan to finance construction of the Museum Plaza project.

The ambitious development has been stalled for years. Last summer, city officials and the project’s developers announced plans to use money from HUD to get construction moving.

Some critics have questioned whether it’s appropriate to use HUD money for the project, but Secretary Shaun Donovan praised the strategy.

“This is a project that has applied to use a very innovative technique with HUD funds, Donovan says basically what the city has done is to say we’re gonna take some of our grant and we’re going to use it essentially as a guarantee against bringing hundreds of millions of dollars of private capital for revitalization.”

HUD has not yet ruled on the loan. The developers of the project still need to secure $140.5 million in additional financing before they can submit the final paperwork for the loan.

Factbox: Guide to enigmatic world of campaign financing

Tuesday, May 24th, 2011

n>(Reuters) – President Barack Obama has begun wooing select crowds of influential campaign donors for his 2012 re-election, while Republican candidates are holding events in halls across the nation to pull in their first millions.

But outside of the candidates own efforts lies a whole satellite system of fund-raising — a dizzying array of surrogates, parties and interest groups, subject to complicated and controversial campaign finance rules. It may all add up to a record-breaking $1 billion campaign for Obama.

Here is a quick guide to how the American campaign money machine works:

HARD MONEY – Money given directly to a candidate for his or her campaign, under Federal Election Commission limits.

INDIVIDUAL CONTRIBUTION LIMITS: An individual can contribute $2,500 to each candidate per election — which means one person can give $2,500 for a primary election and an additional $2,500 for the general election, even if a candidate — like Obama this time — does not have a primary opponent.

An individual can also give $30,800 to the national party committee each year, an amount that is adjusted for inflation over time.

SOFT MONEY – Contribution to political party organizations not recorded as going to a particular candidate, and thus not subject to the same regulation as hard money. Soft money can be used, for example, to pay for issue ads that favor one candidate over another.

POLITICAL ACTION COMMITTEE – A PAC raises and spends limited hard money contributions to elect or defeat candidates or achieve legislative goals. Under federal election law, an organization becomes a PAC by receiving contributions or making expenditures of more than $1,000 for the purpose of influencing a US election.

There are two types of PACs registered with the Federal Election Commission — separate segregated funds, which can only solicit contributions from people associated with the sponsoring organization, and nonconnected committees, which are free to solicit contributions from the general public.

Leadership PAC – Politicians form leadership PACS to, among other things, raise money to help fund other candidates campaigns. They do this because they hope to achieve leadership positions in Congress or a higher office.

Super PAC – A group allowed to raise unlimited funds from individuals and corporations, but which cannot coordinate with candidates or campaigns. They do have to disclose donors. One current controversy is whether officeholders and candidates can help a Super PAC raise funds by telling donors who want to give more than allowed under federal rules to send money to the PAC.

527 ORGANIZATIONS – Nonprofit groups that can spend money on political campaigns but are regulated by tax authorities, not the FEC, because they do not spend money specifically to advocate the election or defeat of any candidate.

One famous 527 was the Swift Boat Veterans for Truth, which was formed in 2004 to oppose John Kerrys campaign for the presidency by maintaining that the senator, who had been regarded as a Vietnam War hero, had distorted facts about his actions during the war.

Another well-known 527 was MoveOn.org, a liberal public policy group formed in 1998 in response to the impeachment of Democratic President Bill Clinton. MoveOn, which is no longer a 527, raised millions for Democratic candidates, including Obama when he won the presidency in 2008.

PUBLIC FINANCING – The public financing system was created to limit the influence of private money on election campaigns by offering government matching funds for political contributions, up to a limit of $250 per contribution.

For years, almost all presidential candidates who could qualify accepted matching funds. However, because taking the funds subjects candidates to strict fundraising limits, the number has dropped. No major candidate is expected to do so for 2012.

Obama had pledged to seek public financing for the general election in 2008, but reversed himself to avoid fundraising limits and raised a record $750 million. His Republican opponent, John McCain, took the public money and found himself short on cash.

BUNDLERS – Bundlers are donors who can gather contributions from many individuals in an organization or community, which are put together and given to a campaign.

CITIZENS UNITED – A precedent-breaking 2010 ruling by the US Supreme Court that overturned rules limiting campaign spending by corporations, unions and other groups. The decision was based on the argument that such groups have free speech rights like those granted to individuals by the US Constitution and that restricting the amount of money they can spend on campaigns infringed upon those rights.

The Center for Responsive Politics estimates there have been at least $140 million in anonymous donations since the ruling for electioneering communications, or advertisements that dont directly advocate for a candidate, but run near to an election and generate a clear message.

(Editing by Mary Milliken, Alistair Bell and Jackie Frank)