Tax-exempt municipal leasing is a highly specialized form of financing that involves legal issues and funding methods that are totally different from those found in traditional commercial leasing. Because the interest charges on the installment type payment of a municipal lease are exempt from federal, and sometimes even state and local taxes, a municipal leasing company offers attractive terms at rates below those found with traditional commercial financings. In addition to having a resource to specifically purchase tax-exempt municipal lease arrangements, a leasing company like All American, specializing in municipal lease arrangements, can provide the necessary financial expertise to see that the lease agreement is properly structured, contains the necessary non-appropriation provisions, and complies fully with local, state and federal laws.
Municipalities should look for three things when developing a relationship with a leasing company: experience in tax-exempt municipal leasing, flexibility and solid funding capability.
- Experience. All American possesses direct, proven skills in implementing and closing tax-exempt municipal leases for a variety of equipment and deal sizes with lessees in various states in the municipal marketplace.
- Flexibility. Flexibility is the key to the quality of service. No two municipal lease transactions are alike. Contracts range from the thousands to the millions of dollars and from simple one-time leases to master lease programs. All American has demonstrated the ability to respond to particular leasing situations in a flexible fashion and in a timely manner.
- Funding Capability. All American’s track record proves we have the ability to fund transactions of any size promptly and can generally fix and hold committed rates from the time of proposal to the time of funding.