Our Municipal Finance Program offers advantages over alternative financing sources. We specialize in structuring and funding Municipal Tax-Exempt financing solutions for renewable energy equipment and real-property projects by state agencies and their political subdivisions such as counties, cities, towns, villages, public universities and colleges, police and fire departments, school districts, municipal hospitals and other municipal districts.
Additionally, we have the experience and the capability to offer other financial products associated with issuing any kind of certificate of indebtedness or tax-exempt bond issuance program. Our products are as follows: municipal leasing, municipal tax-exempt leasing, tax-exempt bond issuance, certificates of participation.
Municipal transactions are generally governed by the Internal Revenue Code in conjunction with the By-Laws of a municipality. Under these requirements, a qualified entity can finance property acquisitions and/or equipment (assets) under contracts in which the interest income the leasing company derives will be exempt from Federal income tax. The benefit to the municipal entity will be a tax-exempt transaction can be financed at a lower interest rate below traditional commercial banking financing.
A Municipal Finance Program has some of the similarities of a commercial lease, with three significant differences:
(1) The Municipal Lease has the result that the lessee is to purchase and take title to the equipment or asset. The financing is a full payout agreement with a bargain purchase at the end of the lease term allowing for acquiring title to asset.
(2) Payments under the lease include the return of principal and interest, with interest being exempt from Federal income taxation.
(3) The Lease allows for termination for non-appropriation of funds by the municipal entity.
A significant advantage in utilization of this program is today’s economy. “reel” municipal leasing specialist work directly with equipment manufacturers, vendors, and municipal officials to facilitate equipment lease financing in a creative, timely, and fiscally responsible manner. “reel” has partnered with Institutional Lenders and Insurance Companies to expedite the process of obtaining financing through a mechanism of public financing options.