LDCs – The Little Engines That Could
The growth of LDCs appears unstoppable. Numbering more than 270 statewide, LDCs focused initially on financing private not-for-profit, civic facilities and economic development. Taken to the next level, LDCs have become a municipal financing mechanism in their own right. Within the past six months, Albany and Saratoga Counties are contemplating new LDCs to create revenue streams to support the sale of public nursing homes. Albany is considering establishing an LDC to loan money to a private entity to run the County nursing home. Taking this one step further, Saratoga County, who has yet to find a purchaser for its nursing home, plans to lease their nursing home to an LDC who would, in turn, lease it back to the County. The LDC then would use the equity in the nursing home to pay for its operations while a buyer is pursued. It is notable that the County already borrowed $7 million from the LDC against the sale of the nursing home in order to balance its 2013 budget.