Local Government Funding Agency
A Local Government Funding Agency (LGFA) is financial institution that serves as a vehicle for local and regional authorities such as municipalities, county councils and regions to access capital markets for the purpose of jointly procuring credit for public investment projects. The local and/or regional authorities of a country own the LGFA, sometimes with a minor ownership by the state. It works as a co-operative agency where the participating authorities come together in order to ensure low interests rates on loans, based on the creditworthiness of the participating members. This co-operation can also help the local authorities to achieve a higher credit rating than if they act independently. The agency normally does not seek to make profits and any surplus is usually reinvested in the activities. LGFAs exist and operate within the borders of the respective countries where they are found.
LGFAs by country
- Denmark (KommuneKredit, 1898)
- Holland (Bank Nederlandse Gemeenten, 1914)
- Norway (Kommunalbanken, 1927), n.b. owned by the state.
- Holland (Nederlandse Waterschapsbank, 1954)
- Canada (Municipal Authority of British Columbia, 1970)
- USA (various municipal bondbanks such as: Vermont Municipal Bond Bank, 1970; Maine Municipal Bond Bank; Sunshine State Governmental Financing Commission, 1985; and others)
- Switzerland (Emissionszentrale der Schweizer Gemeinden, 1971)
- Sweden (Kommuninvest, 1986)
- Finland (Municipality Finance, 1989)
- Italy (Cassa del Trentino, 2005)
- France (Agence France Locale, 2013)[1]
- New Zealand (2009)[2]
Further reading
- Decentralization and local Democracy in the World (Barcelona: United Cities and Local Governments, 2009), p. 149, ISBN 978-0-8213-7734-5
- Financing Urban Shelter: Global Report on Human Settlements (London: Earthscan, 2005), p. 42, ISBN 92-1-131739-8
- Henry A. Davis (ed), Infrastructure Finance: Trends and Techniques (London: Euromoney, 2008), p. 68.
- Michael Barker (ed), Financing State and Local Economic Development (Durham, NC.: Duke University Press, 1983), p. 134-135