Local Government Bond Financing Program
IFA’s Local Government Bond Financing Program is now easier to access, and at a lower cost! This is great news for local governments and school districts needing money for capital improvements or to remedy cash flow needs. We’ve streamlined the process… a transaction can now be approved at just one board meeting, making it easier for borrowers to market their bonds through competitive or negotiated sale. We’ve also substantially reduced legal fees – creating a range of savings to the borrower of a minimum of $1,750 for smaller issues up to $4,250 for bond issues of more than $25,000,000. The Program closing fee remains a reasonable 15 basis points. The Application fee of $250 will now be refunded at closing.
IFA local government and school district bonds are exempt from both federal and state income taxes, making them very attractive investments for Illinois residents. Additionally, the stimulus package allows bond issues up to $30 million to be “Bank Qualified” through calendar 2010, making the bonds especially attractive for in-state bank investment. The combination of double tax-exemption and bank qualification of bond interest will result in a substantially lower borrowing cost to the borrower. Additionally, with IFA State Aid Intercept whereby the borrower can consent to the intercept of state aid payments to cover shortfalls in debt service payments, the bond buyer can rely on additional security for their investment.
The Illinois Finance Authority is a major conduit issuer of local government and school district bonds. Click here to contact an IFA Funding Manager for additional information. To learn more about IFA’s Local Government Bond Program or to access an application, click here.
