Units of government borrow money by issuing bonds.  Think your bonds will be hard to sell?  Think again -- muni bonds have a reputation for being a safe and secure investment, and it is usually fairly easy to investors who want to own your bonds.  The real challenge is figuring out which type of bond to sell, which selling option makes the most sense, and how to control transaction expenses.  Your options include:

 

• A competitive sale of conventional bonds:   For big projects where finding the absolute best interest rate is critical,  selling your bond by competitive bid makes sense -- it is worth shopping around!!  

• A negotiated sale of conventional bonds:  For special situations, such as an interest rate sensitive refunding, or issuance of a revenue bond were the underlying security is complex,  negotiated sales work well.   Just make sure when you are negotiating with the bank or underwriter,  you have someone on your side of the table that is looking out for your interests.  That is DDA's job!

• State & Federal loan programs:  Rural Development,  the PFA, the SBA -- all have grant and loan programs that can be attractive.  But beware,  sometimes the rules and red tape can add extra costs to the project which cancel the benefit of a  lower interest rate.  We will help you take a realistic look at whether your project will quality for funding, and if these options truly make financial sense.

• Bank Placement:  For smaller projects and situations where debt can be repaid in 10 years or less,  a direct placement of bonds with your local commercial bank is often possible.  But, just like a negotiated sale of bonds,  make sure you have an independent advisor representing your interests -- so you know you are truly getting a goo deal.

• Rural Water Association Loans:  Minnesota and Wisconsin RWA have loan programs that are low cost, easy and competitive.  Especially for very small debt offerings,  their programs are hard to beat.  And DDA provides staffing and processing services too, so you still get the benefit of qualified assistance. Check them out! >>>