Industrial Revenue Bonds
Description: EIEDA issues double tax-exempt revenue bonds on behalf of manufacturing companies to finance the acquisition of assets such as land, buildings and equipment or to construct new or renovate existing facilities. They are limited by federal law to selected purposes, such as manufacturing firms. Interest on tax-exempt bonds is exempt from federal income tax.
Benefits: The benefits of Industrial Revenue Bonds include:
- Long term – Maturity of the bonds is flexible and can range from ten to thirty years.
- Low Interest Rate – Rates are generally 2.0% to 3.0% below Prime Rate. The interest rates are discounted to reflect tax-exempt status. Rates range well below conventional financing.
- Flexible Terms – Interest rates may be fixed or variable and can finance up to 100% of the eligible project costs.
- Favorable Terms – There is no fixed minimum job creation or capital investment requirements, although some jobs have to be created.
Eligibility: Some major eligibility requirements include: Total costs cannot exceed $20 million. The average maturity cannot exceed 120% of the economic life of facilities financed. Industrial Revenue Bonds require volume cap. Funds expended prior to sixty days before receiving initial approval from the Authority may not be eligible. The capital improvements must take place in the territory of the Authority.
Fees: A $2,000 non-refundable application fee is due when the application is submitted. Please make checks payable to the Eastern Illinois Economic Development Authority. An issuance fee of 80 basis points is due at closing. Costs of issuance funded from tax-exempt private activity bond proceeds are limited to 2.0%.
Contact: For an application or additional information please contact Andrew Hamilton, Executive Director, Eastern Illinois Economic Development Authority (EIEDA), 1817 South Neil Street, Suite 100, Champaign, Illinois 61820, Tel: 866-325-7525, email: email@example.com