501(c)(3) Revenue Bonds

501 (c)(3) bonds are a low-cost source of tax-exempt financing for capital improvement projects for qualified nonprofit corporations.

Eligible Entities

Any nonprofit organization designated as a 501(c)(3) by the Internal Revenue Service, including:

  • Healthcare Organizations
    • Hospitals
    • Assisted living facilities
    • Nursing homes
  • Educational Organizations
    • Colleges and universities
    • Private elementary and high schools
    • Research institutions
    • Charter Schools
  • Cultural Organizations
    • Museums
    • Libraries
    • Art Galleries
  • Recreational Organizations
  • Community Centers
  • YMCAs
  • Boys and Girls Clubs

These bonds can be used for:

  • the cost of land, buildings, equipment and/or infrastructure related to the acquisition or construction of a project;
  • refinancing prior debt; and
  • financing costs including costs incurred in connection with issuing the bonds, debt service reserve accounts and capitalized interest.

Benefits include:

  • Low interest rates;
  • Better terms;
  • Comprehensive funding as the bond proceeds cab be used for construction and take-out financing of land, buildings and equipment; and
  • Allows borrower to retain accumulated funds.