Tax Increment Financing

Used to finance qualified infrastructure projects, Advoca Capital provides Tax-Exempt Bond Financing for Tax Increment Financing (TIF) projects. The Bonds are issued through a qualified municipal entity, placed by Advoca Securities and the Bond proceeds finance the economic development at a tax-exempt interest rate.

Municipalities use TIFs to raise sufficient funds, relatively quickly and inexpensively, to finance important capital improvement projects. The proceeds from the sale of TIF bonds sold in the municipal securities market are used to finance development project costs. This results in substantial benefits to developers because the cost of borrowing is substantially cheaper if Tax-Exempt Bonds are utilized rather than the developer having to secure a conventional bank loan for financing.

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The Advoca Capital program utilizes a straightforward application and closing procedure and is funded by the issuance of the TIF Bonds.

• Engage Advoca Capital as Advisor.
• Advoca Capital undertakes an initial credit evaluation to determine if the borrower qualifies for the program.
• Advoca works with the developer in contacting the appropriate municipal issuer.
• Upon qualification, Advoca Capital sends the underwriting information to a group of acceptable Letter of Credit Banks, if applicable.
• Upon approval of the application by a Letter of Credit Bank, a Commitment Letter is issued to the borrower detailing the required security elements, operative loan covenants and other requirements and contingencies necessary for loan closing.
• Borrower’s counsel reviews the Commitment Letter.
• Borrower executes and returns Commitment Letter, along with any commitment fees stipulated in the Commitment Letter to Advoca Capital.
• Bond documents are generated and distributed to the financing team.
• Borrowers generally can be funded within 45 to 60 days following execution of the Commitment Letter.