IRS regulations allow municipalities to borrow an amount of money equal to the maximum cumulative negative cash flow for the current fiscal year plus 5% of the working capital expenditures from the previous year. The municipality must provide cash flow projections for the year in the form of a cash flow certificate.
This type of municipal loan includes the following features:
- Loan proceeds are placed in a CD at a higher rate than the interest on the loan
- The municipality "earns interest" on the loan
- Terms to fit your needs
Stop by and speak with a member of our Municipal Team to learn more.