I n today s environment of declining tax revenue and increased operating costs, cities are searching for new and innovative ways to finance badly needed capital equipment purchases. Today taxpayers demand that municipal leaders hold the line on taxes while insisting that more and better service be provided. To Your Needs Interest rates will vary, of course, with the economy depending on the amount of the purchase, corporate credit rating and term of the loan. Futuristic innovative financing is here today.
All governmental leases contain a non-appropriations clause.
This basically says that the finance company agrees to allow the government agency to return the equipment without further recourse or cost to that agency if the governing body doesn t allocate the necessary funds. This would be subject, of course, to any local charter or state statutes to the contrary. However, this can vary - thus state statutes as well as the government agencies charter should be researched to see that no conflict exists. Many of the lease companies we work with are willing to structure skip payments. Yes - government leases can be structured to provide a one dollar payoff at the end of the lease if that is the wish of the city, county or township.