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Alliance Funding Group Expands Into Federal Financing; Funds Initial Transaction.

Alliance Funding Group (“AFG”), in collaboration with a prime contractor and AFG’s investor, completed funding of an approximate $4.8 million multi-function device refresh for a major U.S.-based military installation.

The federal financing helped the military completely refresh its full contingent of aged multi-function devices with over 700 new devices. The financing was in conjunction with a broader services solution, allowing the installation of new devices, maintenance and supplies on a managed service, firm, fixed-price, five-year basis.

The financial solution is the culmination of a broad-based education process, which AFG has entered into to better understand and penetrate the federal finance discipline, as it continues to expand its unique niche into differentiated industry disciplines. “We have partnered with an industry-leading expert to develop a dedicated, financial solutions-based ‘go to market’ team to take advantage of a very large, yet underserved market,” mentioned Brij Patel, President of AFG. “It is AFG’s intent to fully understand and capitalize on this market opportunity, such that we can appropriately educate our investor market while seeking to partner with key federal prime contractors and help the federal end-user market achieve its capital equipment and technology requirements.”

“This financing will act as a catalyst to more quickly propel AFG forward in this very unique space. It not only acts as a resume underpinning, but the ‘hands-on’ learning, the documentation building, the understanding of the market drivers is something that will accelerate this endeavor and act to broaden our own revenue base,” stated Mike Willerer, AFG’s Director of Operations. “I can’t speak highly enough for the collaboration with our prime contractor and our investing partners. I hope and expect that we can parlay this into a deeper relationship by bringing capital, service and financial structural ideas to this market.”

About Alliance Funding Group

Alliance Funding Group is a privately held, minority-owned, non-bank, equipment leasing company with 100+ years of executive management experience with 20+ years in business. AFG has funded over $2 billion to 16,000+ customers with 100+ employees with headquarters in Tustin, California. AFG is a direct lender with the ability to fund transaction sizes up to $20 million and provide customized solutions to underwrite various credit profiles.[/vc_column_text][/vc_column][/vc_row]

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Municipal Leasing : Why you should use this tax-exempt leasing solution

Municipal Lease Purchase

The IRS requires these transactions be a) a lease to ownership plan (installment purchase); b) for equipment that is essential to the government function; and c) have no significant residual or balloon payment at the end of the contract term.

A Municipal Lease is a contract that has many of the characteristics of a standard commercial lease, with three primary differences:

In a Municipal Lease, the intent of the lessee is to purchase and take title to the equipment. The financing is a full payout contract with no significant residual or balloon payments at the end of the lease term.

The lease payments include the return of principal and interest, with the interest being exempt from Federal income taxation to the recipient. Typically, a tax-exempt interest transaction will be financed at interest rates lower than equivalent commercial financing.

The Municipal Lease provides for termination for non-appropriation of funds by the Government Agency.

Termination for non-appropriation distinguishes a Municipal Lease from all other types of leases. The clause normally is required so that the lease does not constitute a long-term debt instrument (which would require a lengthy process for issuance). The obligation to pay is subject to appropriations being made annually over the term set forth in the lease. To justify non-appropriation, the municipality generally must certify that it does not have funds to continue payments and has made its best efforts to procure funds by requesting the funds in its budget.

A Municipal Lease offers several advantages over alternative methods of financing. First and foremost is simplicity. Under most state statutes, municipal contracts with terms of over one year require significant investments in time and money in order to comply with municipal debt restrictions. Since a Municipal Lease is, in effect, a year-to-year obligation, many of these requirements do not apply. The ease of executing a Municipal Lease minimizes the elapsed time and the expenses associated with issuing any kind of certificate of indebtedness or bond.

Another major advantage is economy. A Municipal Lease is most often the least expensive method of financing equipment that costs from $5,000 to $2,000,000 or more. The very slight interest rate advantage offered by a municipal bond is offset by the legal and administrative costs incurred in generating the bond issue. The Municipal Lease requires neither the bond election nor the long-term administration of the bond. The Municipal Lease exerts no impact on the organization’s credit availability and provides greater flexibility in allocating available resources. Additionally, a Municipal Lease does not require the separate legal or underwriting fees that the municipality would incur with a bond issue. Leasing provides a rapid solution to the municipality. Other than accrued interest, there is no penalty for early buyout of the lease. Municipal Leases are not true leases, but are firm purchase agreements and are similar to conditional sales contracts or installment purchases subject to termination in the event of non-appropriation.


Municipal Lease transactions can be provided for states and their political subdivisions such as counties and cities. Departments or agencies such as state universities, fire and police departments, school districts, sanitation, hospitals, or special districts may also be eligible. To be qualified, a governmental entity must possess one of three characteristics of a government; they must possess the power of eminent domain, police powers, or the power to levy taxes. The fact that an agency is supported by government funds or is not subject to sales tax does not always ensure qualification. Non-profit corporations do not qualify for Municipal Leasing.


Alliance Funding Group (AFG) provides all documentation for the transaction. On occasion, the lessee will be required by law to employ local jurisdiction lease documents and supporting legal instruments. When this occurs AFG makes every reasonable effort to accommodate these requirements. In all cases, as a Municipal Lease specialist, AFG provides appropriate documentation to support the transaction.


  • Virtually any type of personal property:
  • Computers and Software
  • Office Equipment
  • Furniture
  • Surveillance Equipment
  • Vehicles and Accessories
  • Heavy Equipment
  • Refuse Equipment
  • Telephone and Communications Equipment
  • Modular Structures
  • Heat/Air Conditioning Equipment
  • Energy Management Equipment


Quick Delivery: Lease financing allows a government entity to obtain needed equipment immediately without waiting for voter approval through a bond issue. This means increased productivity for the government entity.

Non-Appropriation: In most jurisdictions, the authority of an administrator to enter into debt or obligation of future funds is severely limited. For this reason, a Municipal Lease is characterized by a non-appropriation clause that specifies that the lease can be terminated in the event funds are not made available in subsequent fiscal years. Title to the equipment usually resides with the lessee so that the Government Agency’s sales and property tax exemptions apply.

$1 Buyout: The Lessee owns the equipment at the end of the lease term.

Early Purchase Option: If funds become available, the Government Agency has the option to buy-out the lease at any time after the completion of the first fiscal year. A detailed amortization schedule is provided for each transaction.

Flexible Terms: The payment can be tailored to suit the needs of each Government Agency. Annual, semi-annual, quarterly and monthly payment intervals are available with terms extending to the useful life of the equipment. Deferrals, down payments and advance payments can also be arranged. Terms reflective of the useful life of the equipment have a lower interest expense as compared to long-term bond issues. Lessees can choose payment schedules most suited to their needs, including length of contract, payment interval and advance or arrears payments. Up to 100% of the equipment cost can be financed as well as training and maintenance.

Nothing Down: under most payment plans, there is any down payment or security deposit required. However, structuring the lease with advance payments may lower the net cost of financing to the Lessee. AFG can also defer the first payment up to one (1) year; however, a down payment is required with the delayed payment option.

Because the acquisition costs are spread over multiple fiscal years, a Municipal Lease removes budgetary constraints, permits the purchase of needed equipment, allows an upgrade of the equipment, and provides the ability to obtain additional units.

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Leasing a Truck vs. Buying

Considering Leasing a truck over buying?

If you work in the transportation or logistics industry, as an owner-operator, contractor or business owner, there often comes a time in which you need to consider leasing a new truck over buying one.

These are a few things to consider to help you decide between the two options:

Need something reliable?

Leasing makes sense for many in the transportation business because it allows them to use a reliable vehicle at the lowest upfront cost possible. This can be great for someone who is new to the industry and who doesn’t want to deal with the hassles of maintenance or the pitfalls of purchasing a used vehicle.

It provides great flexibility as well, as once the lease term expires, the lessee can choose a similar vehicle or another one. Tax deductions can be claimed on the lease payments.

Lower upfront cost with leasing

There’s a dramatically lower upfront cost with leasing, many financing agreements to purchase a truck require up to 15 to 25% down, depending on the type of truck and the strength of the application.

Typically a brand new truck will be leased, with a minimal to no down payment. Monthly payments are usually lower than the cost of financing the same vehicle.

However, at the end of the lease, there is no ownership of the vehicle, if it is an operating lease structure.

Some lease structures may allow for the purchase of the vehicle at some point during the term of the lease or at the end, such as a capital lease, but these are typically long-term leases and come with several terms to consider.

Prefer to own your equipment?

In some transportation businesses, there is a desire or a practical need for equipment and fleet vehicle ownership.

Perhaps there are particular customizations that need to be made to the vehicles, which leasing typically would not allow. Some businesses want a sense of control over their assets which ownership provides.

In any case, purchasing a vehicle can make sense for some. However, it comes with drawbacks such as the need to cover maintenance after the warranty period expires, submitting a larger down payment for the vehicle, and not being able to upgrade or trade it in for a different vehicle after a few years.

It can be tricky to make the decision on whether to lease or buy a truck for your transportation business. AFG is able to meet with you to help you make the absolute best decision for your situation. Call us at 800-978-8817 with any questions.

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Equipment Leasing Benefits

3 Equipment Leasing Benefits

Leasing can save your business in many ways and ensure that you have new equipment to build it up. Relying on purchasing used or outdated equipment just isn’t an option for many businesses that need reliable equipment for their operations.

Consider these equipment leasing benefits which can make all the difference in the success of your company:

Tax Benefits       

Although it’s a good idea to meet with your accountant to discuss the specifics of how leasing can benefit your taxes, there are numerous tax advantages to leasing compared to buying.

You can often deduct the entire lease payments against your current revenue. However, if you had purchased your equipment, you would typically only be able to deduct the interest on the payment, not the principle.

With certain types of lease structures, such as a non-tax capital lease, you can also potentially take a Section 179 deduction which provides a deduction up to the full purchase price of the equipment (with certain dollar limits you should discuss with your accountant).

Not Needing to Rely on Outdated Equipment

Perhaps one of the biggest advantages is that you won’t have to rely on outdated equipment. By being able to use new equipment, you can ensure the efficiency of your operation and avoid costly downtime or mistakes.

Your risks are substantial when you purchase used equipment, and although you gain equity in your equipment if you purchase it and make payments toward it, you are also typically responsible for repairs and maintenance, especially if it is out of warranty.

Save Capital

By leasing equipment, you save on capital expenses substantially. For example, you will have to typically put a substantial percentage of the total cost down if you purchase your equipment outright. That can be a huge chunk of your savings if you are a newly established business or otherwise are dealing with cash flow issues.

Leasing offers a variety of benefits, including those mentioned above and many others, in terms of flexibility, minimal upfront costs, and the ability to obtain the necessary new equipment to grow your business.

Alliance Funding Group offers a variety of lease structures for many types of equipment for the industries we specialize in, among others, including IT, manufacturing, construction, transportation & logistics, agriculture, healthcare, and state and local government.

Contact Alliance Funding Group today at 1-800-978-8817 to learn more about the equipment leasing options available to you.