PA Department of Community and Economic Development
The mission of the Department of Community and Economic Development (DCED) is to foster opportunities for businesses to grow and for communities to succeed and thrive in a global economy. Our mission is to improve the quality of life for Pennsylvania citizens while assuring transparency and accountability in the expenditure of public funds.
400 North Street Harrisburg Pennsylvania 17120 United States
PEDFA provides cost-effective financing to businesses by
issuing bonds, selling the bonds to private investors, and
lending the proceeds to eligible businesses.
Pennsylvania Economic Development Financing Authority (PEDFA) Bond
PEDFA administers both a tax exempt and a taxable bond program which can
be used for land and building acquisition, building renovation and new
construction, machinery and equipment acquisition and installation,
designed infrastructure, refinancing and working capital. PEDFA's
competitive interest rates and affordable closing costs make the financing
cost effective for projects of all sizes. Depending on the size of the
project, the bond may be a stand-alone bond or it may be part of our
Composite Bond Pool.
Tax-Exempt bonds are bonds for which the interest earned by the
bondholders is excluded from federal income tax. Since these bonds are more
attractive to investors, the interest cost of Tax-Exempt bonds is
restricted by federal law.
Taxable bonds have a higher interest rate than Tax-Exempt bonds, but
they are not subject to the same stringent tax requirements as Tax-Exempt
bonds. All businesses qualified to do business in Pennsylvania except
speculative activities may be eligible for taxable financing. There are
also fewer restrictions on the uses of the funds. PEDFA Applications must
be submitted by a local Industrial Development Authority (IDA) or
Industrial Development Corporation (IDC). Please see this list of IDAs and IDCs.
PEDFA Rates for Composite Bond Pool
The following chart is designed to help prospective borrowers determine what the effective or “all-in” rate would be for a PEDFA composite pool financing on any given day (These rates do not apply to stand-alone bond issues). The top figure is a rate based on an average of rates for a specified period. The four following figures are estimated annual charges, all of which are totaled to show what the effective rate would be (the final figure in bold).
PLEASE NOTE: The weekly variable rates as of June 12, 2017 were as follows: Tax-Exempt – 0.94% / Taxable – 1.10%.
Variable Weekly Interest Rate
Master Bank LC Fee
Local Bank Fee *
* Estimated Rate – Fee is negotiated between the borrower and
their local bank
** With a minimum fee of $1,750 and a maximum of
PEDFA Standard Form Bond Documents
You may access the appropriate standardized form bond documents (the
"Bond Documents") that are utilized in connection with the PEDFA Composite
Bond Pool by referring to our Bond Form Library. Do not utilize Bond Documents
from any earlier PEDFA pool, as we are always working to fine tune the Bond
Documents and earlier versions may be somewhat different. We suggest that
prospective Borrowers provide the Bond Documents to their counsel at their
earliest convenience for his / her review. The Bond Documents not only set
forth the terms and conditions of the financing, but they contain important
representations, warranties, and covenants that the Borrower will make at
the time of the project's closing.
Please note that all Bond Documents, except the Reimbursement Agreement
(for double-tier projects) and the Reimbursement, Credit, and Security
Agreement (for single-tier projects) (collectively the "Reimbursement
Agreement") are in final form. Bond Document negotiation for individual
PEDFA pool projects is not feasible, as the success and cost-efficiency of
a PEDFA pool depends on uniformity. A good example is the Standard
Provisions for Trust Indentures (the "Standard Provisions"), one of the
Bond Documents. The Standard Provisions are incorporated by reference in
each project's Trust Indenture, and as such, cannot deviate among