Tufts Shared Services Inc., a nonprofit providing fee-based services primarily to Tufts Medical Center in Boston and Tufts University in Medford and Somerville, will use the proceeds from a $2.5 million tax-exempt lease issued by MassDevelopment to buy and install two replacement chillers.

MassDevelopment’s tax-exempt leases act essentially as installment loans. An investor lends funds to the borrower to purchase equipment and complete any related renovations, and the borrower agrees to make periodic fixed-rate payments. Generally, the borrower leases the equipment for a length of time approximating the useful economic life of the equipment. At the end of the lease term, the borrower typically pays a nominal amount and assumes ownership of the equipment, according to a statement. "MassDevelopment’s value lease program is a low-cost way for nonprofits to finance equipment they need," said MassDevelopment President and CEO Marty Jones. "Just as Tufts Shared Services supports other organizations, we’re pleased to aid the company with this lease."

Tufts Shared Services, which has roots dating to 1930 and was incorporated as a 501(c)(3) nonprofit in 1968, works to support the activities of the University and the Medical Center without duplicating efforts. The organization currently serves the two institutions by managing the Utility Supply Center at the hospital, parking facilities and a copy center, according to a statement.