7.14 Loans from existing participants are more likely in the JV's early stages or at initial funding; loans from banks become more likely as the JV grows or where it is possible to leverage against property or income generating assets. The possibility of the JV raising funds through bonds will only arise when the JV has reached a very substantial size because of minimum size-of-issue constraints.
7.15 Local authorities may also consider raising funds through the prudential borrowing regime. Local authorities will need to consider whether any financial assistance provided to the JV can be afforded through future revenues and should factor in their prudential borrowing limit.
7.16 Public sector bodies should consult with their sponsor bodies and where appropriate the relevant HM Treasury spending team to ensure they have the necessary powers and resources to make loans to the JV and/or to understand the impact of third party debt raised by the JV on the public sector body's accounting and budgetary position (see also Chapter 5).