Monroe County is participating in an American Recovery and Reinvestment Act (ARRA) of 2009 program in which the County can authorize the issuance of up to $1,593,000 in Recovery Zone Economic Development Bonds and up to $2,389,000 in private activity Facility Bonds. Bond arrangements and repayment are the full obligation of the applicant, and no financial responsibility will be assumed by Monroe County.
Applications for projects must be submitted for consideration by April 15, 2010 and be able to close on financing on or before Nov. 30, 2010. The Monroe County Commissioners, in conjunction with the business assistance committee of the Monroe County Economic Development Council, will make a decision on projects at their June 7, 2010 meeting.
Applications and information can be accessed by clicking on Documents in the lefthand column of this page, then click on the Economic Development folder to access the appropriate information and forms.
Interested persons can also contact Nora Feuquay, U of I Extension Community and Economic Development Educator at 618-939-8681, ext. 309 or nfeuquay@illinois.edu
“One of the qualifications for participating in this ARRA program was that the County had to designate which areas of our County are recovery zones, and based on factors such as a dramatic increase in unemployment throughout the County, the County Commissioners decided to designate the entire County as a recovery zone, said Monroe County Board Chair Delbert Wittenauer.
“This means that projects anywhere in Monroe County are eligible to apply for consideration, as long as they meet the qualifications outlined in the Recovery Zone bond applications. The goal of this program is to create and retain jobs as well as stimulate private investment in the County. The benefits to this program are that on the Recovery Zone Economic Development bonds there is a Federal Tax Credit available and with the Recovery Zone Facility Bonds private businesses can access tax exempt bonds they couldn’t access before,” said Wittenauer.
According to the Federal government, the bonds may be issued for “qualified economic development purpose”, which is defined as “expenditures for purposes of promoting development or other economic activity in a recovery zone, including: capital expenditures paid or incurred with respect to property located in such zone, expenditures for public infrastructure and construction of public facilities, and expenditures for job training and educational programs.”
Two types of bonds are available through the ARRA program:
Recovery Zone Economic Development Bonds (RZED)
Monroe County has an allocation of $1,593,000 for Recovery Zone Economic Development Bonds, which are designed for public infrastructure projects and cannot finance private business use. These bonds must be issued by January 1, 2011.
The bonds are sold as taxable bonds with one of the following options:
*Bondholder Tax Credit: The bondholder receives a Federal Tax Credit equal to 35% of the bond interest.
*Issuers may receive a cash subsidy (refundable credit) directly from the U.S. Treasury equal to
45% of the bond interest.
Recovery Zone Facility Bonds (RZFB)
Monroe County has an allocation of $2,389,000 for Recovery Zone Facility Bonds, which can be used to finance depreciable capital projects and facilities such as hotels, office buildings, shopping centers, etc.
However, the acquisition of land is not an approved use of these bond funds. These are tax-exempt bonds and do not have a Federal interest subsidy. The bonds must be issued by January 1, 2011.
*95% of the bond proceeds must be used for property in the Monroe County Recovery Zone (which includes the entire County).
*Property must be constructed, reconstructed, renovated, or acquired by the borrower after the date of the Recovery Zone designation. Monroe County designated the entire county as a recovery zone at its November 16, 2009 meeting.
*Used equipment and existing buildings are eligible but have substantially more rigid
requirements which may eliminate some projects.
*Substantially all of the use is in the Recovery Zone and first used in the active conduct of a qualified business.
