Facility Finance Authority outlines conduit bonds, trust loans and CPACE financing for rural health and community projects

Adam Gill, executive director of the Montana Facility Finance Authority (MFFA), told the appropriations subcommittee the authority helps nonprofit healthcare and community borrowers access lower-cost capital through conduit bonds, direct revolving loans, trust-fund loans and a commercial PACE (CPACE) program.

Gill explained conduit bonds are issued through local units of government and allow nonprofits to access tax-exempt rates. He used a recent refinancing example: Beartooth Billings Clinic and Red Lodge, where MFFA helped refinance higher-cost loans and achieved a lower fixed rate that saved the borrower about $2.2 million over the bond term.

MFFA also operates small direct revolving-loan programs (typical loans below $500,000), a coal-tax-trust-funded loan option (loans up to $1.5 million), and the CPACE program that enables energy- and water-efficiency upgrades paid via a property tax special assessment. Gill cited a private renovation financed by CPACE that included heat pumps, lighting and windows and noted lenders—interest in the program is growing.

Why it matters: MFFA said these financing channels help rural hospitals, clinics and small businesses obtain critical equipment and repairs that otherwise might be unaffordable. Gill offered examples including a trust-fund loan that enabled a rural medical center to acquire an MRI that otherwise would require patients to travel more than 100 miles.

Ending: The authority said it operates without taxpayer support, funds its operations from fees, and remains available statewide for eligible borrowers; lawmakers had no substantive follow-up questions during the hearing.