Tax-Exempt Lease/Purchase

Equipment manufacturers, vendors, leasing brokers and municipal officials rely on MFC’s responsive and knowledgeable financing specialists to strategically structure and fund municipal equipment needs.

Whether the financing takes the form of a loan, lease/purchase or installment/purchase agreement, below are some important details about our equipment and facilities financing program.

General Criteria

  • Financing is a tax-exempt obligation under Section 103 of the Internal Revenue Code.
  • Financing may apply to any form of equipment, facilities or real property improvements that are essential to the operations of the public agency.
  • Useful life of the financed property exceeds the financing term.
  • Creates general or special fund obligation of the public agency.

Cost and Flexibility

  • Credit approvals within 7 days.
  • Funding within 30 days.
  • One point of contact to facilitate financing.
  • Interest rates may be held firm for up to 90 days, if required.
  • No costs of issuance other than the legal/document review by the public agency’s general counsel.
  • No ongoing administration fees apply.
  • Financing terms range from 3 to 20 years.
  • Financing amounts range from $50,000 to $10,000,000.
  • Flexible prepayment provisions are provided.
  • Financing may be either escrow funded or structured as a capital credit line.

Requirements of Public Agency

  • Credit qualify by submitting annual audit reports for last three years and current budget.
  • Obtain authorization of governing body of public agency to enter into financing agreement.
  • Obtain legal opinion on financing documents from public agency general counsel.
  • Enter into acquisition/construction contracts with vendors/contractors and authorize payments.

Legal Requirements

  • Public agency qualifies as a political subdivision within the meaning of Section 103 of the Internal Revenue Code of 1986, as amended.
  • All constitutional and statutory steps have been taken to enter into the financing agreement.
  • Public agency assumes risks/rewards associated with ownership of the financed property.


Modular BuildingsComputer & Peripherals
Jail FacilitiesSoftware
Library SystemsExcavators
Law Enforcement EquipmentBulldozers
Fire StationsModular Classrooms
New & Used Fire TrucksStreet Improvement Projects
Fire & Safety EquipmentCafeteria Equipment
Communication EquipmentAir Conditioning & Heating
Video EquipmentBuses & Transportation Equipment
New & Used AmbulancesEducation Equipment
Medical EquipmentTelephone Systems
Garbage handling EquipmentEnergy Management Systems
Street SweepersSewer Treatment Equipment
GeneratorsFresh Water Treatment Equipment
Maintenance EquipmentAirport Equipment
Classroom & Office FurnitureMaterial Recovery Equipment
CopiersTraffic Control Systems
Service ContractsParking Meters
Gas Conversion EquipmentGarbage Trucks
Water TrucksStreet Cleaners
Police Cars