Capital Note (CAN) Program
The Capital Note (CAN) Program offers tax-exempt short-term securities which not-for-profit institutions use to fund routine capital expenditures, renovations and construction projects.
Who Can Participate?
Any institution that is qualified to borrow from the Authority under RSA 195-D or 195-E is eligible to be a borrower under this Program.
Due to a pooled financing or bank financing, fees and expenses will be substantially less than a standard bond issue.
For capital expenditures, an institution's maximum borrowing is equal to the institution's annual routine capital expenditures. If borrowing for renovations or a construction project there is no limit.
To the extent that Note proceeds are not needed to fund routine capital expenditures, they can be invested in higher-yielding taxable securities that generate additional revenue.
Note issuance is significantly less complicated and less expensive than the standard bond issue.
- Greatly reduced disclosure requirements
- Simpler form documents
- Unsecured borrowing
- Expense is shared among pool participants
Many institutions can achieve a short-term rating without credit enhancement.
Capital Notes are expected to be issued as part of an annual pool each Spring or as a bank financing. If part of a pool, an institution should have a Standard & Poor's rating of SP-1 on its own credit or it must obtain a letter of credit which is rated SP-1. Each institution is only liable for its debt and not for the debt of any other institution in the pool.
Capital Notes are usually short-term notes that will mature within 12 months.
For an application or additional information, contact:
David C. Bliss, Executive Director
New Hampshire Health and Education Facilities Authority
P.O. Box 2110
Concord, NH 03302-2110