California Pollution Control Financing Authority’s New Rules Keep Costs of Tax Exempt Bonds Low

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As shared by the California Pollution Control Financing Authority: Last month the California Pollution Control Financing Authority (CPCFA), chaired by Treasurer John Chiang, took formal action to help large and small businesses in California keep costs low when financing waste management and recycling projects.

On June 29, CPCFA extended a waiver of the Small Business Assistance Fund fee which was due to sunset on June 30.  Since the 1980s, the fee has been assessed on tax-exempt bond financing requested by large businesses, and has provided important funding to support credit enhancement and other financing programs for small businesses. The fee was temporarily waived in 2013 after CPCFA received one-time federal funding for its small business programs. Given how low the interest rate for conventional lending remains, CPCFA extended the fee waiver as an incentive to large businesses to seek project financing through CPCFA’s tax-exempt bond program.

As part of the same action, small businesses received an additional incentive to refinance old debt for qualifying pollution control projects. These emergency regulations adopted by  CPCFA include a significant waiver of the general fees applicable to refinancing sought by a small business when the amount to be refunded is packaged together with new money for a new project, and the amount to be refunded is less than the new money amount.

These actions will benefit large and small businesses by lowering the costs to finance important solid waste, sewage and water furnishing projects.  More information about CPCFA’s tax-exempt bond program and these new rules is posted at CPCFA’s website.

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