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Concord NY IDA - Financing Based Programs
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The first type of financing based program offered is industrial development revenue bonds. There are two types of industrial development revenue bonds available.
The first type, tax-exempt IRB’s are available only for certain qualifying manufacturing projects and for civic facilities. The interest on such bonds is exempt for federal taxes and state income taxes (for State residents only). In addition the Agency can offer real property tax abatement, sales tax abatement and mortgage recording tax abatement. The Agency can also offer assistance to companies in the form of taxable industrial development revenue bonds. The eligibility requirements for these bonds are not limited to manufacturing projects. They offer all the same incentives as the tax-exempt IRB’s except for the federal tax exemption. In both cases, the Agency does not lend or give its own money to the applicant. It takes title to the project and issues bonds to the lender. The applicant itself guarantees repayment of the bonds and the lender provides the financing.
What the Agency does is act as a conduit, reducing the cost to the applicant of doing business and thus facilitating the transaction. Industrial development bond financing is also available for equipment purchases where no real estate is involved.
There is a second type of financing based program, the mortgage transaction, wherein the Agency can provide assistance. The Agency can take title to the project and joins with the applicant to place a mortgage on the project to finance the project. In this instance, the applicant itself delivers a promissory not to the lender and agrees to repay the mortgage. The lender then loans the money to the applicant. The Agency again acts as a conduit. This type of transaction provides real property tax abatement, sales tax abatement and mortgage tax abatement.
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