CHFFA: Tax-Exempt Equipment Financing Program Grant

The CHFFA: Tax-Exempt Equipment Financing Program provides California health facilities with access to tax-exempt, fixed-rate financing for equipment purchases exceeding $500,000. This initiative, managed by the California Health Facilities Financing Authority, enables applicants to finance essential medical and diagnostic equipment, computers, and telecommunications tools. The program is designed to ease the financial burden on public and nonprofit hospitals by offering competitive loan terms, ensuring that loan maturity aligns with the equipment's useful life, and facilitating minor installation costs.

Tax-Exempt Equipment Financing Program – CHFFA
The California Health Facilities Financing Authority (CHFFA) recognizes that health facilities utilize a variety of equipment in every day operations, and that the financing can add considerably to the overall cost of equipment purchases.
CHFFA established the program to provide health facilities with access to tax-exempt fixed rate financing for their equipment purchases.
Applicants may use funds for qualifying equipment purchases of $500,000 or more. The maturity of the notes must be related to the useful life of the equipment to be financed. Notes issued through the program will be collateralized by the equipment that is purchased.
Uses of Funds
Applicants may use funds for qualifying equipment purchases of $500,000 or more. The maturity of the notes must be related to the useful life of the equipment to be financed. Notes issued through the program will be collateralized by the equipment that is purchased.
Applicants may use the note proceeds to purchase or reimburse all types of qualifying equipment, including, but not limited to:

• Medical and diagnostic equipmentComputers
• Telecommunications equipment
• Proceeds may also be used to finance minor equipment installation costs.
• Loan Terms

Market determined fixed interest rate, depending on maturityThe maturity of the loan must relate to the useful life of the equipment to be financedLoan minimum of $500,000, no maximum loan amount
Program Fees
CHFFA offers a competitive fee structure as follows:

• $500 non-refundable application fee
• One-time initial fee equal to .05 percent of the aggregate amount of the issuance
• $400 annual administrative fee

Eligibility

In order to meet the requirements for CHFFA financing, an Applicant must meet the following criteria:Be a public hospital, or a private non-profit health facility (See Section 15432 (d) of the California Government Code for full list of eligible facilities);Have been operating for a minimum of three years prior to submitting an application for financing and provide three years of audited financial statements; andHave revenue or collateral sufficient to cover debt service on the proposed financing.