Description: WKRDA issues 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
  • Quasi-State Guarantee – The bonds can receive a quasi-state guarantee (moral obligation) from the State of Illinois which allows the borrower to attach to the State’s credit strength

 
Eligibility: Some major eligibility requirements include: Total costs can not exceed $10 million. The average maturity cannot exceed 120% of the economic life of facilities financed. Industrial Revenue Bonds require volume cap.

 
Fees: A $2,000 non-refundable application fee is due when the application is submitted. An issuance fee of 60 basis points and Professional fee of 20 basis points due at closing plus the cost of Issuer’s legal counsel. Costs of issuance funded from tax-exempt private activity bond proceeds are limited to 2.0%. The fees generally cannot exceed more than 1/8th of the yield on the bonds.

Contact: For an application or additional information please contact Andrew Hamilton, Executive Director, Will Kankakee Regional Development Authority (WKRDA), Two Rialto Square, 116 N. Chicago Street, Joliet, Illinois 60432, Tel: 815/723-9070.