The Ohio Higher Educational Facility Commission (OHEFC or the Commission) was created to assist independent, not-for-profit institutions of higher education to finance the construction, renovation or rehabilitation of facilities at a lower interest cost than would be available to them elsewhere.
The Commission was created by Senate Bill 453 of the 107th General Assembly, which became law on March 8, 1968 . This legislation enacted Chapter 3377 of the Ohio Revised Code. The Commission is an agency of the State of Ohio. The academic and other facilities built by the Commission are financed by the sale of revenue bonds issued by the Commission. In turn, the Commission enters into agreements whereby a college or university leases the facilities from the Commission and pays rent to the Commission in the amount needed to retire the Commission's bonds.
Since the Commission is an agency of the State of Ohio , the interest paid by the Commission to the bondholders is exempt from federal income tax. Bonds providing tax-free interest income normally sell on the market at a lower rate of interest than taxable bonds.
The use of the financing arrangements for facility construction made possible by the Ohio Higher Educational Facility Commission is entirely voluntary. No independent, not-for-profit college or university is required to enter into an agreement with the Commission. The Commission desires to assist eligible colleges and universities in Ohio to the extent each institution wishes to take advantage of the services.
