Financing of Energy Projects Under a Master Lease Agreement

The Commonwealth of Virginia Department of the Treasury is issuing an RFP on behalf of the Treasury Board to solicit proposals from qualified financial institutions to provide tax-exempt and taxable lease financing for energy efficiency projects, with proposals due September 15, 2026 at 10:00 a.m. and questions due by September 1, 2026 at 5:00 p.m. All offerors must submit a Small Business Subcontracting Plan with a Commonwealth goal of 42% small-business purchases.

The Master Lease Agreement framework finances energy projects reducing energy consumption or operating costs—including HVAC modifications, renewable energy systems, lighting improvements, and related professional services—for state agencies, higher education institutions, and qualified public bodies. Minimum project size is $100,000 or greater. The financing structure operates on an acceptance-date basis using a percentage of an index plus a spread, with lease payments calculated on a level payment basis using fixed interest rates. Offerors propose either 12-year or 15-year lease terms: 12-year leases benchmark against the 7-Year Interest Swap Rate; 15-year leases use the 10-Year Interest Swap Rate, both as published on the Refinitiv Swaps Index Screen or Bloomberg Financial Network at market close two business days before acceptance. Payment frequency options include monthly, semi-annual, and annual structures. All rates must be rounded to no more than four decimal places and constitute final rates with no additional fees permitted.

The initial contract period runs twelve months from November 1, 2026 through October 31, 2027, or until $40 million has been financed, whichever occurs first, with options to extend for two additional twelve-month periods and increase financing capacity by up to $20 million upon mutual written agreement. The contract award is anticipated by October 31, 2026. Escrow fees apply to financings with construction periods, with escrowed funds deposited in qualified public depositories per Virginia law. Historical utilization from the current contract (August 2021–July 2026) totaled two leases of $2,666,712. The Commonwealth reserves the right to make multiple awards and may cancel or reject proposals without providing reasons. Submission is via the eVA e-procurement portal.