Tax-exempt financing

Government Tax-Exempt Financing

As a longstanding lender, Key has helped municipalities, not-for-profit providers and manufacturing businesses realize substantial cost savings for years. By structuring tax-exempt lease purchases and tax-exempt bonds to meet your unique requirements, we help you acquire the technology and assets you need to help our shared communities thrive.


Tax-exempt financing for municipalities

Key Government Finance has valuable tax-exempt experience and relationships with governmental issuers nationwide. States and possessions of the United States & District of Columbia that embody one of three sovereign powers (taxation, eminent domain, police power) include:

  • Cities, counties, towns and villages
  • Public school districts and higher education
  • Water districts, transit authorities

Our tax-exempt financing structures provide our state and local government customers the following distinct advantages:

  • Low tax-exempt rates
  • Low financing costs
  • Streamlined processing (30-60 days)
  • Step payments to match the client's budget and project's useful life

Tax-exempt financing for 501c3 entities

We provide not-for-profit schools and hospitals with the tools required to structure these transactions, quickly and cost-effectively. Key Government Finance offers low tax-exempt rates as well as the following benefits to help this sector meet their budget requirements and stay competitive:

  • 100% advance rate
  • Custom amortizations
  • Low financing costs
  • Quick, efficient processing (90 days from commitment/approval)

Under Section 145 of the Internal Revenue Code, borrowing is facilitated through a governmental issuer—an entity such as a state authority, county or city.


Tax-exempt financing for manufacturers

 Manufacturers look to Key to help secure funding for real estate, new equipment used in the manufacturing process and acquisition of existing facilities through Industrial Revenue Bonds (IRBs). In addition to low financing costs and no letter-of-credit requirement. The primary advantages we offer this niche of corporate clients include:

  • 100% advance rate
  • Low tax-exempt rates
  • Step payments to match budget and project's useful life
  • Allowance for cost of issuance to be included in financing (up to 2%)

Issued by designated local industrial development boards (IDBs) or other issuers authorized by state law, IDBs and IRBs are financing instruments. 

The interest paid on the bonds is exempt from both federal and state income tax; therefore tax-exempt IDBs and IRBs offer lower rates than conventional sources. And because we underwrite tax-exempt financing for our own account, Key Government Finance is able to respond to your needs in a timely and efficient manner.


How the process works

“How

Equipment we finance

  • Manufacturing machinery
  • Medical equipment
  • Construction equipment
  • Commercial vehicles
  • Office equipment and furniture
  • IT and Telecom hardware and software
  • Agriculture
  • Air and marine craft
  • Communications
  • Printing/Media
  • Materials handling
  • "Soft costs," e.g., installation, shipping and training
 
Related Links

Schools
Hospitals
Government finance products
Consult a government finance expert


Manufacturers/Vendors

KEF also provides equipment financing solutions to our customers through our partnerships with manufacturers, dealers and resellers.


Businesses/Corporations

KEF also offers tailored equipment financing solutions directly to our government customers, helping them to reduce costs and increase efficiencies.