An independent public financing authority in Massachusetts has created a $150 million capital asset program for Partners HealthCare System that will allow the Boston-based regional network to tap low-cost funds for the next 30 years.
The Massachusetts Health and Educational Facilities Authority says the financing vehicle is the first in the state designed to support the capital needs of an integrated healthcare delivery network.
Partners and its member organizations, including Massachusetts General Hospital and Brigham and Women's Hospital, will be able to borrow from the pool at tax-exempt rates to finance information systems, equipment, routine capital improvements, renovations and other projects, according to the financing authority.
Loans will be structured to match the lives of the projects, and when they are repaid the funds will be "recycled" at no additional borrowing costs to finance new projects.
The arrangement "will provide long-term financing access in a volatile and changing market," says Jay Pieper, vice president of corporate development and treasury affairs for Partners. "The capital asset program provides a solution to an industry that has historically been project finance-based, providing the flexibility to finance shorter-lived assets with long-term bonds."
A bond issue to create the pool was sold during the week of June 16.