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Friday, September 05, 2008 |
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Industrial Development Bond Financing
Uses:
Bonds must be used to finance manufacturing or processing projects.
Uses include land, buildings, equipment, furnishings, and issuance costs.
Fifteen to 30-year maturities.
Restrictions:
75% of the assets purchased with the bonds must be for actual manufacturing or processing.
25% of the bond proceeds can be used for land acquisition.
2% of the bond proceeds can be used for issuance costs.
Maximum Loan Amount:
$10,000,000 per applicant per jurisdiction. Included in the $10,000,000 are capital expenditures made by the company in the same jurisdiction 3 years prior and 3 years after the bond issuance. Company may not have any more than $40,000,000 in IDBs outstanding nationwide.
Interest Rates:
Average more than 2% below prime rate.
Terms:
15 to 30 years depending on assets financed by bond proceeds.
Process:
Typically 90 to 120 days.
Phase 1: Pre-qualification: Involves the preparation of a pre-application and subsequent review by bond counsel to assure that the project meets state and federal requirements.
Phase 2: State and Local Approvals: An inducement resolution is made by the issuer, a public hearing is held within the project’s jurisdiction, letter of credit is finalized, and the state holds two hearings to approve the project and allocate tax exempt debt.
Phase 3: Bond Issuance: Resolution of issuance, bond sale, and funding.
Contact:
Contact: Local Industrial Development Financing Authority (or)
California Economic Development Financing Authority (CEDFA)
Trade and Commerce Agency
801 K Street, Suite 1700
Sacramento, CA 95814
(916) 322-3250
(916) 322-7214 Fax
Chico Redevelopment Agency–Industrial Financing
Uses:
The Chico Redevelopment Agency has $300,000 allocated for financial assistance to industrial businesses located within the Chico Municipal Airport. Project will vary, however the primary purpose of the program is to finance the sale of city-owned property located at the airport to industrial businesses.
Restrictions:
Projects must be located within the Chico Merged Redevelopment Project Area and conform to California Redevelopment law.
Maximum Loan Amount:
Varies
Interest Rates:
Varies
Terms:
Varies
Process:
1) Proposal presented to the Council’s Economic Development Committee
2) Council consideration
3) Formalize documents
Contact:
Contact: Local Industrial Development Financing Authority (or)
California Economic Development Financing Authority (CEDFA)
Trade and Commerce Agency
801 K Street, Suite 1700
Sacramento, CA 95814
(916) 322-3250
(916) 322-7214 Fax
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