The Oklahoma Finance Authorities' mission is to assist in the creation and retention of employment opportunities throughout Oklahoma by providing a financing conduit or by providing loans to communities, businesses and institutions on a basis that will not jeopardize the credit rating of the State and at a minimum cost and minimal risk exposure to the taxpayers of the State.


The Industrial Finance Authority and Development Finance Authority were consolidated into the Oklahoma Finance Authorities (OFA) during 1992. The unification of these activities was necessary in order to provide the most efficient and effective economic development financing apparatus. Consolidation of the finance authorities was made possible through the voluntary actions and consent of the Boards of Directors. This allowed for a smooth transition without need for the creation of new law. With policy direction provided by both the Governor and Legislative economic leaders, a unified and direct approach to economic development lending programs has eliminated duplicative and possibly diametric efforts. The Authorities will continue to streamline and coordinate state financing activities with the private sector financial community while expanding the number of lending programs they can provide.

The consolidation of ODFA and OIFA has enabled the combined Authorities to take advantage of resource sharing and economies of scale which have reduced overall expenses and provided a consistent economic development strategy for the many lending programs. The Authorities' funds have in no way been commingled; only the administrative functions have been combined. The combined Authorities administer 97 loans which are obligations of the state with an outstanding principal of approximately $51.3 million. The OFA staff also provides administrative services for a portfolio of transactions with had an original balance of approximately $161 million. Economic development, job creation and retention, through the development of a true working relationship with the state's private sector financial institutions and the implementation of the new lending programs and greater efficiency in the administration of the united Authorities will be OFA's primary objectives for the future. The ODFA's board has implemented the Public Facilities Finance Program which will provide funds for communities with an emphasis on creating and retaining jobs. The infrastructure loan pool will make use of up to $32 million for the financing needs of communities. Upgraded utilities and other infrastructure creates direct assistance to those communities vying for new industry.

A study conducted by the University of Oklahoma Center for Economics and Management Research in FY-92 found that there was high awareness among Oklahoma's financial community of both ODFA and OIFA lending programs, however the depth of knowledge among respondents was not extensive. Increased knowledge depth will be the focus of a marketing effort in a state wide program that will bring in to play the state's private sector financial community, the Oklahoma Department of Commerce, State chamber of Commerce and Industry and the Oklahoma Bankers Association.

A brief synopsis of both OIFA and ODFA is followed by detailed operational information relating to OIFA.

Oklahoma Industrial Finance Authority

Until 1986, the Oklahoma Industrial Finance Authority's primary role was that of a second mortgage financier. It had been created to fill the gap between what businesses needed and could actually borrow from lending institutions. In 1986, the constitution was amended by a vote of the people, and OIFA was set on a new course. Suddenly OIFA was no longer a secondary financier, but became a first mortgage primary lender. Businesses unable to find private financing came to OIFA for help and banks unable to satisfy the needs of their customers sought out the OIFA.

Instead of being able to lend only one third of the cost of establishing an industrial project, OIFA could lend two-thirds of the fixed assets cost. A dollar cap of two million dollars and one million dollars for first and second mortgage approved loans was set. The bond cap of $20 million was raised to $90 million.

The people of Oklahoma have never been called upon to spend tax dollars in support of the OIFA and through the full faith and credit of the people of Oklahoma, OIFA has been able to finance hundreds of businesses hiring thousands of employees.

Oklahoma Development Finance Authority

The OIFA provides funding for private ventures used to increase jobs in the state and for not-for-profit ventures, political subdivisions, governmental entities and agricultural producers. Many of the projects funded through the ODFA do have indirect or spillover effects in the evolution of a more highly educated and trained workforce.

During the 21-year history of the ODFA, two billion dollars have been made available to help meet capital needs of Oklahoma firms and farms, schools, hospitals and governmental entities. The two basic forms of lending utilized by ODFA are conduit and credit-enhancement financing. The Authority utilizes conduit financing to provide borrowers with lower cost financing, due to the Authority's standing as a public trust, without creating risk for ODFA itself. The Credit Enhancement program is a means by which the Authority provides guarantees for small companies, manufacturing facilities and communities in need of funds for expansion projects and infrastructure loans. "Credit Enhanced" financing carry a financial guarantee of the Credit Enhancement Reserve Fund (CERF). The fund assumes part or all of the risk of repayment of the credit enhanced notes or bonds.